1
$165,000,000
CREDIT AGREEMENT
dated as of
October 18, 1996
among
KEMET CORPORATION
The Banks Listed Herein
and
WACHOVIA BANK OF GEORGIA, N.A.,
as Agent
and
ABN AMRO BANK N.V. ATLANTA AGENCY,
as Co-Agent
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TABLE OF CONTENTS
CREDIT AGREEMENT
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions 1
SECTION 1.02. Accounting Terms and Determinations 16
SECTION 1.03. Use of Defined Terms 16
SECTION 1.04. Terminology 16
SECTION 1.05. References 16
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Syndicated Loans 16
SECTION 2.02. Method of Borrowing Syndicated Loans 17
SECTION 2.03. Money Market Loans 18
SECTION 2.04. Notes 22
SECTION 2.05. Maturity of Loans 22
SECTION 2.06. Interest Rates 23
SECTION 2.07. Fees 25
SECTION 2.08. Optional Termination or Reduction of Commitments 26
SECTION 2.09. Mandatory Termination of Commitments 26
SECTION 2.10. Optional Prepayments 26
SECTION 2.11. Mandatory Prepayments 27
SECTION 2.12. General Provisions as to Payments 27
SECTION 2.13. Computation of Interest and Fees 31
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing 31
SECTION 3.02. Conditions to All Borrowings 32
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power 33
SECTION 4.02. Corporate and Governmental Authorization;
No Contravention 33
SECTION 4.03. Binding Effect 34
SECTION 4.04. Financial Information 34
SECTION 4.05. Litigation 34
SECTION 4.06. Compliance with ERISA 34
SECTION 4.07. Taxes 34
SECTION 4.08. Subsidiaries 35
SECTION 4.09. Not an Investment Company 35
SECTION 4.10 Public Utility Holding Company Act 35
SECTION 4.11. Ownership of Property; Liens 35
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SECTION 4.12. No Default 35
SECTION 4.13. Full Disclosure 35
SECTION 4.14. Environmental Matters 36
SECTION 4.15. Compliance with Laws 36
SECTION 4.16. Capital Stock 36
SECTION 4.17. Margin Stock 37
SECTION 4.18. Insolvency 37
ARTICLE V
COVENANTS
SECTION 5.01. Information 37
SECTION 5.02. Inspection of Property, Books and Records 39
SECTION 5.03. Ratio of Consolidated Funded Debt to
Consolidated Total Capital 39
SECTION 5.04. Minimum Consolidated Net Worth 39
SECTION 5.05. Ratio of Earnings Before Interest, Leases and
Taxes to Consolidated Fixed Charges 39
SECTION 5.06. Loans or Advances 39
SECTION 5.07. Investments 40
SECTION 5.08. Factor Receivables 40
SECTION 5.09. Negative Pledge 40
SECTION 5.10. Maintenance of Existence 42
SECTION 5.11. Dissolution 42
SECTION 5.12. Consolidations, Mergers and Sales of Assets 42
SECTION 5.13. Compliance with Regulations G, T, U and X 43
SECTION 5.14. Compliance with Laws; Payment of Taxes 43
SECTION 5.15. Insurance 43
SECTION 5.16. Change in Fiscal Year 43
SECTION 5.17. Maintenance of Property 44
SECTION 5.18. Environmental Notices 44
SECTION 5.19. Environmental Matters 44
SECTION 5.20. Environmental Release 44
SECTION 5.21. Significant Subsidiaries 44
SECTION 5.22 Sale, Transfer or Pledge of Industrial Revenue
Bonds 45
SECTION 6.01. Events of Default 45
SECTION 6.02. Notice of Default 48
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities 48
SECTION 7.02. Reliance by Agent 49
SECTION 7.03. Defaults 49
SECTION 7.04. Rights of Agent and its Affiliates as a Bank 50
SECTION 7.05. Indemnification 50
SECTION 7.06. CONSEQUENTIAL DAMAGES 50
SECTION 7.07. Payee of Note Treated as Owner 51
SECTION 7.08. Non-Reliance on Agent and Other Banks 51
SECTION 7.09. Failure to Act 51
SECTION 7.10. Resignation or Removal of Agent 51
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ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair 52
SECTION 8.02. Illegality 52
SECTION 8.03. Increased Cost and Reduced Return 53
SECTION 8.04. Base Rate Loans Substituted for Affected
Euro-Dollar Loans 54
SECTION 8.05. Compensation 55
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices 56
SECTION 9.02. No Waivers 56
SECTION 9.03. Expenses; Documentary Taxes; Indemnification 56
SECTION 9.04. Setoffs; Sharing of Set-Offs 57
SECTION 9.05. Amendments and Waivers 58
SECTION 9.06. Margin Stock Collateral 58
SECTION 9.07. Successors and Assigns 58
SECTION 9.08. Confidentiality 60
SECTION 9.09. Representation by Banks 61
SECTION 9.10. Obligations Several 61
SECTION 9.11. Survival of Certain Obligations 61
SECTION 9.12. Georgia Law 61
SECTION 9.13. Severability 61
SECTION 9.14. Interest 61
SECTION 9.15. Interpretation 61
SECTION 9.16. Consent to Jurisdiction 62
SECTION 9.17. Counterparts 62
SECTION 9.18. Knowledge of Borrower 62
SCHEDULE 4.05 Description of Litigation
SCHEDULE 4.08A Existing Subsidiaries
SCHEDULE 4.08B Existing Domestic Significant Subsidiaries
SCHEDULE 4.08C Existing Foreign Significant Subsidiaries
SCHEDULE 4.14 A-1 Description of Environmental Liabilities
SCHEDULE 4.14 A-2 Properties on National Priorities or CERCLIS List
SCHEDULE 5.07 Existing Investments
EXHIBIT A Form of Syndicated Note
EXHIBIT B Form of Money Market Note
EXHIBIT C Form of Opinion of Counsel for the Borrower
EXHIBIT D Form of Opinion of Special Counsel for the Agent
EXHIBIT E Form of Money Market Quote Request
EXHIBIT F Form of Money Market Quote
EXHIBIT G Form of Closing Certificate
EXHIBIT H Form of Secretary's Certificate
EXHIBIT I Form of Compliance Certificate
EXHIBIT J Form of Assignment and Acceptance
EXHIBIT K Form of Notice of Borrowing
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CREDIT AGREEMENT
AGREEMENT dated as of October 18, 1996 among KEMET CORPORATION, the BANKS
listed on the signature pages hereof and WACHOVIA BANK OF GEORGIA, N.A., as
Agent, and ABN AMRO BANK N.V. ATLANTA AGENCY, as Co-Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this Section 1.01
shall, for all purposes of this Agreement and any amendment hereto (except
as herein otherwise expressly provided or unless the context otherwise
requires), have the meanings set forth herein:
"Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.06(c).
"Affiliate" of any Person means (i) any other Person which directly, or
indirectly through one or more intermediaries, controls such Person,
(ii) any other Person which directly, or indirectly through one or more
intermediaries, is controlled by or is under common control with such
Person, or (iii) any other Person of which such Person owns, directly or
indirectly, 20% or more of the common stock or equivalent equity interests;
provided that for purposes of this Agreement, neither CVC nor KEMET
Partners shall be deemed to be an Affiliate of the Borrower or any of its
Subsidiaries. As used herein, the term "control" means possession,
directly or indirectly, of the power to direct or cause the direction of
the management or policies of a Person, whether through the ownership of
voting securities, by contract or otherwise.
"Agent" means Wachovia Bank of Georgia, N.A., a national banking
association organized under the laws of the United States of America, in
its capacity as agent for the Banks hereunder, and its successors and
permitted assigns in such capacity.
"Agent's Letter Agreement" means that certain letter agreement, dated as
of September 5, 1996, between the Borrower and the Agent relating to the
structure of the Loans, and certain fees from time to time payable by the
Borrower to the Agent, together with all amendments and modifications
thereto.
"Agreement" means this Credit Agreement, together with all amendments and
supplements hereto.
"Applicable Facility Fee Rate" has the meaning set forth in Section
2.07(a).
"Applicable Margin" has the meaning set forth in Section 2.06(a).
"Assignee" has the meaning set forth in Section 9.07(c).
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"Assignment and Acceptance" means an Assignment and Acceptance executed
in accordance with Section 9.07(c) in the form attached hereto as Exhibit
J.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as having a
Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate per annum
equal to the higher as of such day of (i) the Prime Rate, and (ii)
one-half of one percent above the Federal Funds Rate for such day. For
purposes of determining the Base Rate for any day, changes in the Prime
Rate and the Federal Funds Rate shall be effective on the date of each such
change.
"Base Rate Loan" means a Loan which bears or is to bear interest at a
rate based upon the Base Rate.
"Beneficial Ownership" shall have the meaning given to such term in Rule
13-d of the Securities and Exchange Commission under the Securities
Exchange Act of 1934.
"Bond Issuance and Purchase Agreement" means that certain Bond Issuance
and Purchase Agreement dated as of December 22, 1994, among Greenville
County, South Carolina, Greenwood County, South Carolina and the Pledgor,
as it may be amended from time to time solely to provide for the issuance
and purchase of additional bonds thereunder.
"Borrower" means KEMET Corporation, a Delaware corporation, and its
successors and permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans made to the
Borrower at the same time by, in the case of a Syndicated Borrowing, the
Banks, or, in the case of a Money Market Borrowing, one or more of the
Banks, in each case pursuant to Article II. A Borrowing is a "Syndicated
Borrowing" if such Loans are Syndicated Loans or a "Money Market Borrowing"
if such Loans are Money Market Loans.
"Capital Stock" means any nonredeemable capital stock of the Borrower or
any Consolidated Subsidiary (to the extent issued to a Person other than
the Borrower), whether common or preferred.
"Cash Equivalents" shall mean (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency
or instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof) having maturities
of not more than 12 months from the date of acquisition, (ii) Dollar
denominated (or foreign currency fully hedged) time deposits, certificates
of deposit, Euro-Dollar time deposits, Euro-Dollar certificates of deposit
of (A) any domestic commercial bank of recognized standing having capital
and surplus in excess of $500,000,000 or (B) any bank whose
short-term commercial paper rating from S&P is at least A-1 or the
equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with
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maturities of not more than 12 months from the date of acquisition, (iii)
commercial paper and variable or fixed rate notes issued by any Approved
Bank (or by the parent company thereof) or any commercial paper and
variable or fixed rate notes issued by, or guaranteed by, any domestic
corporation rated A-2 (or the equivalent thereof) or better by S&P or
P-2 (or the equivalent thereof) or better by Moody's and maturing within 12
months of the date of acquisition, and (iv) interests in money market or
mutual funds which invest solely in assets or securities of the type
described in clauses (i), (ii) and/or (iii) of this definition.
"CERCLA" means the Comprehensive Environmental Response Compensation and
Liability Act, 42 U.S.C. Section9601 et seq. and its implementing
regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response Compensation and
Liability Information System established pursuant to CERCLA.
"Change of Control" shall mean either (i) CVC or any Affiliate of CVC or
CVC together with any Affiliate of CVC (collectively, the "CVC Group")
shall have acquired Beneficial Ownership, directly or indirectly, of Voting
Stock of the Borrower (or other securities convertible into such Voting
Stock) representing 49% or more of the combined voting power of all Voting
Stock of the Borrower, or (ii) any Person or two or more Persons acting in
concert (other than the CVC Group) shall have acquired Beneficial
Ownership, directly or indirectly, of Voting Stock of the Borrower (or
other securities convertible into such Voting Stock) representing 35% or
more of the combined voting power of all Voting Stock of the Borrower; or
(iii) during any period of up to 24 consecutive months, commencing after
the date of this Agreement, individuals who at the beginning of such
24 - month period were directors of the Borrower shall cease to constitute
a majority of the board of directors of the Borrower and such event is the
result (directly or indirectly) of the acquisition of 20% or more of the
combined voting power of the Voting Stock by a Person or Persons that did
not own at least 5% or more of the combined voting power of the Voting
Stock as of the Closing Date; or (iv) any Person or two or more Persons
acting in concert (other than the CVC Group) shall have acquired by
contract or otherwise, or shall have entered into a contract or arrangement
that, upon consummation, will result in its or their acquisition of,
control over Voting Stock of the Borrower (or other securities convertible
into such securities) representing 35% or more of the combined voting power
of all Voting Stock of the Borrower.
"Change of Law" shall have the meaning set forth in Section 8.02.
"Closing Certificate" has the meaning set forth in Section 3.01(e).
"Closing Date" means October 18, 1996.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor Federal tax code. Any reference to any provision of the Code
shall also be deemed to be a reference to any successor provision or
provisions thereof.
"Commitment" means, with respect to each Bank, (i) the amount set forth
opposite the name of such Bank on the signature pages hereof, or (ii) as to
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any Bank which enters into an Assignment and Acceptance (whether as
transferor Bank or as Assignee thereunder), the amount of such Bank's
Commitment after giving effect to such Assignment and Acceptance, in each
case as such amount may be reduced from time to time pursuant to Sections
2.08 and 2.09.
"Compliance Certificate" has the meaning set forth in Section 5.01(c).
"Consolidated Fixed Charges" means, for any period, the sum of (i)
interest, whether expensed or capitalized, in respect of Debt of the
Borrower and its Consolidated Subsidiaries outstanding during such period,
and (ii) all payment obligations of the Borrower and its Consolidated
Subsidiaries for such period under all operating leases and rental
agreements.
"Consolidated Funded Debt" means at any date the Debt of the Borrower and
its Consolidated Subsidiaries, without duplication, determined on a
consolidated basis as of such date.
"Consolidated Net Income" means, for any period, the Net Income of the
Borrower and its Consolidated Subsidiaries determined on a consolidated
basis, but excluding (i) extraordinary items, (ii) any equity interests of
the Borrower or any Subsidiary in the unremitted earnings of any Person
that is not a Subsidiary, and (iii) revenues received in connection with
any Investment by the Pledgor pursuant to clause (iv) of the definition of
Permitted Investments.
"Consolidated Net Worth" means, at any time, Stockholders' Equity.
"Consolidated Operating Profits" means, for any period, the Operating
Profits of the Borrower and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which, in accordance with GAAP, would be
consolidated with those of the Borrower in its consolidated financial
statements as of such date.
"Consolidated Tangible Net Worth" means, at any time, Stockholders'
Equity, less the sum of the value, as set forth or reflected on the most
recent consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries, prepared in accordance with GAAP, of
(A) Any surplus resulting from any write-up of assets subsequent to
March 31, 1996 (excluding any write-ups of Inventory made in the ordinary
course of business);
(B) All assets which would be treated as intangible assets for balance
sheet presentation purposes under GAAP, including, without limitation,
goodwill (whether representing the excess of cost over book value of assets
acquired, or otherwise), trademarks, tradenames, copyrights, patents and
technologies, and unamortized debt discount and expense; and
(C) Loans or advances to stockholders, directors, officers or employees
(but only to the extent the aggregate outstanding amount of such loans and
advances exceeds the limit set forth in Section 5.06(i)).
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"Consolidated Total Assets" means, at any time, the Total Assets of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated
basis.
"Consolidated Total Capital" means, at any time, the sum of (i)
Consolidated Net Worth, and (ii) Consolidated Funded Debt.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as a
single employer under Section 414 of the Code.
"CVC" shall mean Citicorp Venture Capital, Ltd., a New York corporation.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee under
capital leases, other than those certain lease obligations of the Pledgor
to Greenville County, South Carolina and/or Greenwood County, South
Carolina pursuant to the Lease Agreement, (v) all obligations of such
Person to reimburse any bank or other Person in respect of amounts payable
under a banker's acceptance, (vi) all Redeemable Preferred Stock of such
Person (in the event such Person is a corporation), (vii) all obligations
(absolute or contingent) of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (viii) all Debt of others secured by a Lien on any asset of
such Person, whether or not such Debt is assumed by such Person, and (ix)
all Debt of others Guaranteed by such Person; provided, that Debt shall not
include (a) accrued expenses (including without limitation accrued
salaries, accrued vacation, deferred compensation, unfunded projected
pension benefit obligations and unfunded post-retirement medical plans),
accrued dividends, warranty reserves and accrued current and deferred
income taxes, in each case arising in the ordinary course of business, (b)
operating leases (including without limitation financing leases which
constitute operating leases) and (c) in the case of Factor Receivables sold
on a "recourse" basis, the amount of such recourse liability to the extent
of cash deposits securing such liability; and provided further, that Debt
shall not include the obligation of a Person in its capacity as the
servicer, collection agent or similar party to forward amounts collected
with respect to Factor Receivables to the purchaser of such Factor
Receivables.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived in writing, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day, the sum of 2%
plus the then highest interest rate (including the Applicable Margin) which
may be applicable to any Loans hereunder (irrespective of whether any such
type of Loans are actually outstanding hereunder).
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"Dollars" or "$" means dollars in lawful currency of the United States
of America.
"Domestic Business Day" means any day except a Saturday, Sunday or other
day on which commercial banks in Georgia are authorized or required by law
to close.
"Domestic Significant Subsidiary" means any Significant Subsidiary which
is organized under the laws of any state or territory of the United States
of America.
"Earnings Before Interest, Leases and Taxes" means, for any period, the
sum of (i) Consolidated Net Income for such period, (ii) Consolidated Fixed
Charges for such period, (iii) income taxes of the Borrower and its
Consolidated Subsidiaries for such period, but only to the extent such
taxes were deducted in computing Consolidated Net Income for such period,
and (iv) noncash, nonrecurring, one-time charges for such period.
"Environmental Authority" means any foreign, federal, state, local or
regional government that lawfully exercises any form of jurisdiction or
authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits, orders,
approvals, notices, registrations or other legal prerequisites for
conducting the business of the Borrower or any Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means all judgments, decrees or
orders arising from or in any way associated with any violation of or
liability under any Environmental Requirements, whether or not entered upon
consent or written agreements with an Environmental Authority or other
entity arising from or in any way associated with any violation of or
liability under any Environmental Requirement, whether or not incorporated
in a judgment, decree or order.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes
into the environment, including, without limitation, ambient air, surface
water, groundwater or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, petroleum or petroleum products,
chemicals or industrial, toxic or hazardous substances or wastes or the
clean-up or other remediation thereof.
"Environmental Liabilities" means any liabilities, whether accrued,
contingent or otherwise, arising under any Environmental Requirements.
"Environmental Notices" means notice from any Environmental Authority or
by any other person or entity, of possible or alleged noncompliance with or
liability under any Environmental Requirement, including without limitation
any complaints, citations, demands or requests from any Environmental
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Authority or from any other person or entity for correction of any
violation of any Environmental Requirement.
"Environmental Proceedings" means any judicial or administrative
proceedings arising from or in any way associated with any violation of or
liability under any Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA or under any
applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement relating to
health, safety or the environment and applicable to the Borrower, any
Subsidiary or the Properties, including but not limited to any such
requirement under CERCLA or similar state legislation and all federal,
state and local laws, ordinances, regulations, orders, writs, decrees and
common law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, or any successor law. Any reference to any
provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on which
dealings in Dollar deposits are carried out in the London interbank market.
"Euro-Dollar Loan" means a Loan which bears or is to bear interest at a
rate based upon the London Interbank Offered Rate.
"Euro-Dollar Reserve Percentage" has the meaning set forth in Section
2.06(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Facility Fee Determination Date" has the meaning set forth in Section
2.07(a).
"Facility Fee Payment Date" means each March 31, June 30, September 30
and December 31.
"Factor Receivables" means the outstanding amount of those Foreign Trade
Receivables from time to time sold by KESA to Swiss Bank Corporation
pursuant to the Purchase Agreement or sold by KESA (or any other Subsidiary
of the Borrower) pursuant to any other agreement providing for the
factoring, sale or similar financing of Foreign Trade Receivables entered
into with another bank or factor.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the next higher 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the
Domestic Business Day next succeeding such day, provided that (i) if the
day for which such rate is to be determined is not a Domestic Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions
on the next preceding Domestic Business Day as so published on the next
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succeeding Domestic Business Day, and (ii) if such rate is not so published
for any day, the Federal Funds Rate for such day shall be the average rate
charged to Wachovia on such day on such transactions as determined by the
Agent.
"Fiscal Quarter" means any fiscal quarter of the Borrower.
"Fiscal Year" means any fiscal year of the Borrower.
"Foreign Significant Subsidiary" means any Significant Subsidiary which
is not a Domestic Significant Subsidiary.
"Foreign Trade Receivables" means those trade receivables from time to
time generated from the sale of goods or services by the Borrower and its
Subsidiaries to any Non-U.S. Person.
"GAAP" means generally accepted accounting principles applied on a basis
consistent with those which, in accordance with Section 1.02, are to be
used in making the calculations for purposes of determining compliance with
the terms of this Agreement.
"Guarantee" by any Person means any obligation, contingent or otherwise,
of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of
such Person (i) to secure, purchase or pay (or advance or supply funds for
the purchase or payment of) such Debt or other obligation (whether arising
by virtue of partnership arrangements, by agreement to keep-well, to
purchase assets, goods, securities or services, to provide collateral
security, to take-or-pay, or to maintain financial statement conditions or
otherwise) or (ii) entered into for the purpose of assuring in any other
manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part), provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
"Guarantors" means the Domestic Significant Subsidiaries from time to
time party to the Guaranty Agreement.
"Guaranty Agreement" means that certain Guaranty Agreement of even date
herewith executed by the Guarantors for the benefit of the Agent and the
Banks, guaranteeing the obligations of the Borrower under this Credit
Agreement and the other Loan Documents to which the Borrower is a party.
"Hazardous Materials" means (a) solid or hazardous waste, as defined in
the Resource Conservation and Recovery Act of 1980, 42 U.S.C. Section6901
et seq. and its implementing regulations and amendments, or in any
applicable state or local law or regulation, (b) any "hazardous substance",
"pollutant" or "contaminant", as defined in CERCLA, or in any applicable
state or local law or regulation, (c) gasoline, or any other petroleum
product or by-product, including crude oil or any fraction thereof, (d)
toxic substances, as defined in the Toxic Substances Control Act of 1976,
or in any applicable state or local law or regulation and (e) insecticides,
fungicides, or rodenticides, as defined in the Federal Insecticide,
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Fungicide, and Rodenticide Act of 1975, or in any applicable state or local
law or regulation, as each such Act, statute or regulation may be amended
from time to time.
"Hedging Transactions" means any interest rate swap, cap or collar or
currency transactions entered into by the Borrower or any Subsidiary solely
in order to provide interest rate protection or protection from
fluctuations in the values of currencies to the Borrower or such Subsidiary
or to serve a similar hedging purpose (but not for the purpose of
investment or speculation).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending
on the numerically corresponding day in the first, second, third or sixth
month thereafter, as the Borrower may elect in the applicable Notice of
Borrowing; provided that:
(a) any Interest Period (subject to clause (c) below) which would
otherwise end on a day which is not a Euro-Dollar Business Day shall be
extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Euro-Dollar Business
Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall,
subject to clause (c) below, end on the last Euro-Dollar Business Day of
the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(2) with respect to each Base Rate Borrowing, the period commencing on the
date of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Domestic Business Day shall be
extended to the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(3) with respect to each Money Market Borrowing, the period commencing on
the date of such Borrowing and ending 7 to 180 days thereafter, as the
Borrower may indicate in the applicable Money Market Quote Request;
provided that:
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Domestic Business Day shall be
extended to the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
14
"Inventory" shall mean inventory (as defined in Article 9 of the Uniform
Commercial Code) to the extent composed of materials, products or goods of
the type manufactured, sold or consumed by the Borrower or any of its
Subsidiaries in the ordinary course of business.
"Investment" means any investment in any Person (excluding the purchase
by the Borrower of common stock of the Borrower), whether by means of
purchase or acquisition of any capital stock, warrants, rights, options,
obligations or other securities of such Person, capital contribution to
such Person, loan or advance (but excluding deposits, progress payments and
the like to suppliers and service providers for property and services in
the ordinary course of business) to such Person, making of a time deposit
with such Person, Guarantee or assumption of any obligation of such Person
or otherwise.
"KEMET Partners" means the South Carolina general partnership so named
and comprised of certain members of management of KEMET Electronics
Corporation.
"KESA" means KEMET Electronics S.A., a corporation organized under the
laws of Switzerland, together with its successors and permitted assigns.
"KRC" means KRC Trade Corporation, a Delaware corporation, together with
its successors and permitted assigns.
"Lease Agreement" means that certain Lease Purchase and Millage Rate
Agreement, dated as of December 22, 1994, among Greenville County, South
Carolina, Greenwood County, South Carolina and the Pledgor, as it may be
amended from time to time to add or delete assets.
"Lending Office" means, as to each Bank, its office located at its
address set forth on the signature pages hereof (or identified on the
signature pages hereof as its Lending Office) or such other office as such
Bank may hereafter designate as its Lending Office by notice to the
Borrower and the Agent.
"Lien" means, with respect to any asset, any mortgage, deed to secure
debt, deed of trust, lien, pledge, charge, security interest, security
title, preferential arrangement which has the practical effect of
constituting a security interest or encumbrance, servitude or encumbrance
of any kind in respect of such asset to secure or assure payment of a Debt
or a Guarantee, whether by consensual agreement or by operation of statute
or other law, or by any agreement, contingent or otherwise, to provide any
of the foregoing. For the purposes of this Agreement, the Borrower or any
Subsidiary shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease (other than those certain lease
obligations of the Pledgor to Greenville County, South Carolina and/or
Greenwood County, South Carolina pursuant to the Lease Agreement) or other
title retention agreement relating to such asset.
"Loan" means a Syndicated Loan or a Money Market Loan and "Loans" means
Syndicated Loans or Money Market Loans, or any or all of them, as the
context shall require.
15
"Loan Documents" means this Agreement, the Notes, the Pledge Agreement,
the Guaranty Agreement, any other document evidencing, relating to or
securing the Loans, and any other document or instrument delivered from
time to time in connection with this Agreement, the Notes or the Loans, as
such documents and instruments may be amended or supplemented from time to
time.
"London Interbank Offered Rate" has the meaning set forth in Section
2.06(c).
"Margin Stock" means "margin stock" as defined in Regulation G, T, U or X
of the Board of Governors of the Federal Reserve System, as in effect from
time to time, together with all official rulings and interpretations issued
thereunder.
"Material Adverse Effect" means, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse
determination in any litigation, arbitration, or governmental investigation
or proceeding), whether singly or in conjunction with any other event or
events, act or acts, condition or conditions, occurrence or occurrences,
whether or not related, a material adverse change in, or a material adverse
effect upon, (a) the financial condition, operations, business or
properties of the Borrower and its Consolidated Subsidiaries, taken as a
whole, (b) the rights and remedies, taken as a whole, of the Agent or the
Banks under the Loan Documents, or the ability of the Borrower to perform
its obligations under the Loan Documents to which it is a party, as
applicable, or (c) the legality, validity or enforceability of any Loan
Document as to or against the Borrower, any Guarantor or the Pledgor.
"Money Market Loan" means a Loan which bears or is to bear interest at a
Money Market Rate.
"Money Market Notes" means promissory notes of the Borrower,
substantially in the form of Exhibit B hereto, evidencing the obligation of
the Borrower to repay the Money Market Loans.
"Money Market Quote" means an offer by a Bank to make a Money Market Loan
in accordance with Section 2.03(c).
"Money Market Quote Request" has the meaning set forth in Section
2.03(b).
"Money Market Rate" has the meaning set forth in Section 2.03(c)(ii)(C).
"Multiemployer Plan" has the meaning set forth in Section 4001(a)(3) of
ERISA.
"Net Income" means, as applied to any Person for any period, the
aggregate amount of net income of such Person, after taxes, for such
period, as determined in accordance with GAAP.
"Net Proceeds of Capital Stock" means any proceeds (whether cash or
non-cash) received by the Borrower or a Consolidated Subsidiary in respect
of the issuance of Capital Stock (including without limitation, the
conversion of any Debt into Capital Stock), after deducting therefrom all
16
reasonable and customary costs and expenses incurred by the Borrower or
such Consolidated Subsidiary directly in connection with the issuance of
such Capital Stock, provided however that Net Proceeds of Capital Stock
shall not include proceeds received from employees of the Borrower or its
Consolidated Subsidiaries arising from the exercise of compensatory stock
options by such employees in an aggregate amount of up to $15,000,000
during the term of this Agreement.
"Net Worth Change Amount" means, as of any day, an amount (which may be
positive or negative) equal to (a) Consolidated Tangible Net Worth as of
such day (determined on the basis of the quarterly unaudited financial
statements of the Borrower most recently delivered to the Banks pursuant to
Section 5.01(b) for the Fiscal Quarter ending prior to such date) minus (b)
$144,901,000; provided that as to the fourth and final Fiscal Quarter of
any Fiscal Year, upon delivery by the Borrower to the Banks of its annual
audited financial statements for such Fiscal Year pursuant to Section
5.01(a), for purposes of clause (a) of this definition, Consolidated
Tangible Net Worth shall be determined based upon such annual audited
financial statements.
"Non-U.S. Person" means any Person who is not a resident of any state of
the United States of America or the District of Columbia.
"Note" means a Syndicated Note or a Money Market Note and "Notes" means
Syndicated Notes or Money Market Notes, or any or all of them, as the
context shall require.
"Notice of Borrowing" has the meaning set forth in Section 2.02.
"Officer's Certificate" has the meaning set forth in Section 3.01(f).
"Operating Profits" means, as applied to any Person for any period, the
operating income of such Person for such period, as determined in
accordance with GAAP.
"Participant" has the meaning set forth in Section 9.07(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Investments" shall mean Investments which are either (i) cash
and Cash Equivalents, (ii) receivables created, acquired or made in the
ordinary course of business and payable or dischargeable in accordance with
customary trade terms, (iii) investments existing as of the Closing Date
and set forth in Schedule 5.07 (but without additional acquisitions thereof
except as otherwise permitted hereby), (iv) investments by the Borrower,
the Pledgor or any other Guarantor in industrial revenue bonds issued from
time to time by Greenville County, South Carolina and/or Greenwood County,
South Carolina pursuant to the Bond Issuance and Purchase Agreement, or (v)
capital stock or other securities received by the Borrower or any
Subsidiary in payment of an account receivable where such capital stock or
other securities are issued in connection with a bankruptcy reorganization
of the Person obligated to pay such account receivable.
"Person" means an individual, a corporation, a partnership (including
17
without limitation, a joint venture), a limited liability company, an
unincorporated association, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan, as defined in
Section 3(2) of ERISA, which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code and is either
(i) maintained by a member of the Controlled Group for employees of any
member of the Controlled Group or (ii) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one
employer makes contributions and to which a member of the Controlled Group
is then making or accruing an obligation to make contributions or has
within the preceding 5 plan years made contributions.
"Pledge Agreement" means that certain Pledge Agreement of even date
herewith executed by the Pledgor for the benefit of the Agent and the
Banks, securing the obligations of the Pledgor under the Guaranty
Agreement.
"Pledged Shares" shall mean the shares of stock of Foreign Significant
Subsidiaries pledged to the Agent for the benefit of the Bank, pursuant to
and as such shares are identified in the Pledge Agreement.
"Pledgor" means KEMET Electronics Corporation, a Delaware corporation,
together with its successors and permitted assigns.
"Pledgor Subsidiary" shall have the meaning ascribed thereto in Section
5.21(b) hereof.
"Prime Rate" refers to that interest rate so denominated and set by
Wachovia from time to time as an interest rate basis for borrowings. The
Prime Rate is but one of several interest rate bases used by Wachovia.
Wachovia lends at interest rates above and below the Prime Rate.
"Prior Credit Agreements" means the Credit Agreement dated as of February
24, 1995 among the Borrower, Wachovia Bank of Georgia, N.A., as Agent, and
the Banks listed therein, as amended, and the Credit Agreement dated as of
July 31, 1996 between the Borrower and Wachovia Bank of North Carolina,
N.A.
"Properties" means all real property owned, leased or otherwise used or
occupied by the Borrower or any Subsidiary, wherever located.
"Purchase Agreement" means the Purchase Agreement dated as of April 22,
1988 between Swiss Bank Corporation and KESA, as amended from time to time
(including any increases in the aggregate amount of Purchased Receivables
(as defined therein) that may be outstanding from time to time thereunder).
"Quotation Date" has the meaning set forth in Section 2.03(b).
"Rate Determination Date" has the meaning set forth in Section 2.06(a).
"Redeemable Preferred Stock" of any Person means any preferred stock
issued by such Person which is at any time prior to the Termination Date
18
either (i) mandatorily redeemable (by sinking fund or similar payments or
otherwise) or (ii) redeemable at the option of the holder thereof.
"Replacement Bank" has the meaning set forth in Section 8.03(e).
"Reported Net Income" means, for any period, the Net Income of the
Borrower and its Consolidated Subsidiaries determined on a consolidated
basis.
"Responsible Officer" means any of the president, chief executive
officer, executive vice president, chief operating officer, chief financial
officer and treasurer, assistant treasurer, senior vice president of human
resources and vice president of administration of the Borrower.
"Required Banks" means at any time Banks having at least 51% of the
aggregate amount of the Commitments or, if the Commitments are no longer in
effect, Banks holding at least 51% of the aggregate outstanding principal
amount of the Notes.
"Significant Subsidiaries" means (a) KRC, (b) the Domestic Significant
Subsidiaries listed on Schedule 4.08B and the Foreign Significant
Subsidiaries listed on Schedule 4.08C, and (c) on any date any Subsidiary
of the Borrower which has either (i) Total Assets on the last day of the
Fiscal Quarter most recently ended equal to or greater than 10% of
Consolidated Total Assets on the last day of the Fiscal Quarter most
recently ended, (ii) Operating Profits for the period of 4 consecutive
Fiscal Quarters most recently ended prior to such date equal to or greater
than 10% of Consolidated Operating Profits for such period of 4 consecutive
Fiscal Quarters, or (iii) gross revenues for the period of 4 consecutive
Fiscal Quarters most recently ended prior to such date equal to or greater
than 10% of gross revenues of the Borrower and its Consolidated
Subsidiaries for such period of 4 consecutive Fiscal Quarters; provided
that any Subsidiary of the Borrower that is a "foreign sales corporation"
as defined in Section 922(a) of the Code shall not be deemed to be a
Significant Subsidiary.
"Stockholders' Equity" means, at any time, the stockholders' equity of
the Borrower and its Consolidated Subsidiaries, as set forth or reflected
on the most recent consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries prepared in accordance with GAAP, but excluding
any Redeemable Preferred Stock of the Borrower or any of its Consolidated
Subsidiaries. Stockholders' equity generally would include, but not be
limited to (i) the par or stated value of all outstanding Capital Stock,
(ii) capital surplus, (iii) retained earnings, and (iv) various adjustments
such as (A) purchases and sales of treasury stock, (B) valuation
allowances, (C) receivables due from an employee stock ownership plan, (D)
employee stock ownership plan debt guarantees, and (E) translation
adjustments for foreign currency transactions.
"Subsidiary" means any corporation, limited liability company or other
entity of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly owned
by the Borrower.
19
"Syndicated Loan" means a Base Rate Loan or a Euro-Dollar Loan and
Syndicated Loans means Base Rate Loans or Euro-Dollar Loans, or any or all
of them, as the context shall require.
"Syndicated Notes" means promissory notes of the Borrower, substantially
in the form of Exhibit A hereto, evidencing the obligation of the Borrower
to repay the Syndicated Loans, together with all amendments,
consolidations, modifications, renewals and supplements thereto and
"Syndicated Note" means any one of such Syndicated Notes.
"Taxes" has the meaning set forth in Section 2.12(c).
"Termination Date" means October 18, 2001, or such date to which the
Termination Date may be extended pursuant to Section 2.05(b).
"Test Amount" means, on any day, an amount equal to $48,982,800 plus
(only in the case where the Net Worth Change Amount is positive) the Net
Worth Change Amount as of such day.
"Third Parties" means all lessees, sublessees, licensees and other users
of the Properties, excluding those users of the Properties in the ordinary
course of the Borrower's business and on a temporary basis.
"Total Assets" of any Person means, at any time, the total assets of such
Person, as set forth or reflected or as should be set forth or reflected on
the most recent balance sheet of such Person, prepared in accordance with
GAAP.
"Transferee" has the meaning set forth in Section 9.07(d).
"Unencumbered Total Assets" of any Person means, at any time, Total
Assets of such Person which are subject to any arrangement specified in 12
CFR Section221.2(g)(1).
"Unused Commitment" means at any date, with respect to any Bank, an
amount equal to its Commitment less the aggregate outstanding principal
amount of its Loans.
"Voting Stock" shall mean, with respect to any Person, capital stock
issued by a corporation, or equivalent interests in any other Person, the
holders of which are ordinarily, in the absence of contingencies, entitled
to vote for the election of directors (or persons performing similar
functions) of such Person, even though the right so to vote has been
suspended by the happening of such a contingency.
"Wachovia" means Wachovia Bank of Georgia, N.A., a national banking
association and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the shares of
capital stock or other ownership interests of which (except (i) directors'
qualifying shares, and (ii) shares required by applicable law to be owned
by any Person other than the Borrower or any other Wholly Owned Subsidiary)
are at the time directly or indirectly owned by the Borrower.
20
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all terms of an accounting character used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared
in accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Borrower's independent public accountants or otherwise
required by a change in GAAP) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries
delivered to the Banks, unless with respect to any such change concurred in
by the Borrower's independent public accountants or required by GAAP, in
determining compliance with any of the provisions of this Agreement or any
of the other Loan Documents: (i) the Borrower shall have objected to
determining such compliance on such basis at the time of delivery of such
financial statements, or (ii) the Required Banks shall so object in
writing within 30 days after the delivery of such financial statements, in
either of which events such calculations shall be made on a basis
consistent with those used in the preparation of the latest financial
statements as to which such objection shall not have been made (which, if
objection is made in respect of the first financial statements delivered
under Section 5.01 hereof, shall mean the financial statements referred to
in Section 4.04).
SECTION 1.03. Use of Defined Terms. All terms defined in this Agreement
shall have the same meanings when used in any of the other Loan Documents,
unless otherwise defined therein or unless the context shall otherwise
require.
SECTION 1.04. Terminology. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender, shall
include all other genders; and where the context so indicates the singular
shall include the plural and the plural shall include the singular. Titles
of Articles and Sections in this Agreement are for convenience only, and
neither limit nor amplify the provisions of this Agreement.
SECTION 1.05. References. Unless otherwise indicated, references in
this Agreement to "Articles", "Exhibits", "Schedules", and "Sections" are
references to articles, exhibits, schedules and sections hereof.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Syndicated Loans. Each Bank severally
agrees, on the terms and conditions set forth herein, to make Syndicated
Loans to the Borrower from time to time before the Termination Date;
provided that, immediately after each such Syndicated Loan is made, the
aggregate outstanding principal amount of Syndicated Loans by such Bank
shall not exceed the amount of its Commitment, provided further that the
aggregate principal amount of all Syndicated Loans, together with the
aggregate principal amount of all Money Market Loans, at any one time
outstanding shall not exceed the aggregate amount of the Commitments of all
of the Banks at such time. Each Base Rate Borrowing under this Section
shall be in an aggregate principal amount of $1,000,000 or any larger
multiple of $1,000,000 and each Euro-Dollar Borrowing under this Section
shall be in an aggregate principal amount of $10,000,000 or any larger
21
multiple of $1,000,000 (except that any such Syndicated Borrowing may be
in the aggregate amount of the Unused Commitments) and shall be made from
the several Banks ratably in proportion to their respective Commitments.
Within the foregoing limits, the Borrower may borrow under this Section,
repay or, to the extent permitted by Section 2.10, prepay Syndicated Loans
and reborrow under this Section at any time before the Termination Date.
SECTION 2.02. Method of Borrowing Syndicated Loans. (a) The Borrower
shall give the Agent notice in the form attached hereto as Exhibit K (a
"Notice of Borrowing") prior to 11:00 A.M. (Atlanta, Georgia time) on the
same Domestic Business Day as each Base Rate Borrowing and at least 2
Euro-Dollar Business Days before each Euro-Dollar Borrowing, specifying:
(i) the date of such Syndicated Borrowing, which shall be a Domestic
Business Day in the case of a Base Rate Borrowing or a Euro-Dollar Business
Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Syndicated Borrowing,
(iii) whether the Syndicated Loans comprising such Syndicated Borrowing
are to be Base Rate Loans or Euro-Dollar Loans, and
(iv) in the case of a Euro-Dollar Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly
notify each Bank of the contents thereof and of such Bank's ratable share
of such Syndicated Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the Borrower.
(c) Not later than 12:00 noon (Atlanta, Georgia time) on the date of
each Syndicated Borrowing, each Bank shall (except as provided in
subsection (d) of this Section) make available its ratable share of such
Syndicated Borrowing, in Federal or other funds immediately available in
Atlanta, Georgia, to the Agent at its address referred to in or specified
pursuant to Section 9.01. Unless the Agent determines that any applicable
condition specified in Article III has not been satisfied, the Agent will
make the funds so received from the Banks available to the Borrower by
deposit into an account designated by the Borrower from time to time and
maintained by the Borrower or the Pledgor with any bank located in the
United States of America. Unless the Agent receives notice from a Bank, at
the Agent's address referred to in Section 9.01, no later than (i)
4:00 P.M. (local time at such address) on the Domestic Business Day before
the date of a Syndicated Borrowing consisting of Euro-Dollar Loans or (ii)
11:30 A.M. (local time at such address) on the Domestic Business Day of a
Syndicated Borrowing consisting of Base Rate Loans, stating that such Bank
will not make a Syndicated Loan in connection with such Syndicated
Borrowing, the Agent shall be entitled to assume that such Bank will make a
Syndicated Loan in connection with such Syndicated Borrowing and, in
reliance on such assumption, the Agent may (but shall not be obligated to)
make available such Bank's ratable share of such Syndicated Borrowing to
the Borrower for the account of such Bank. If the Agent makes such Bank's
ratable share available to the Borrower and such Bank does not in fact make
its ratable share of such Syndicated Borrowing available on such date, the
22
Agent shall be entitled to recover such Bank's ratable share from such Bank
or the Borrower (and for such purpose shall be entitled to charge such
amount to any account of the Borrower maintained with the Agent), together
with interest thereon for each day during the period from the date of such
Syndicated Borrowing until such sum shall be paid in full at a rate per
annum equal to the rate at which the Agent determines that it obtained (or
could have obtained) overnight Federal funds to cover such amount for each
such day during such period, provided that any such payment by the Borrower
of such Bank's ratable share and interest thereon shall be without
prejudice to any rights that the Borrower may have against such Bank. If
such Bank shall repay to the Agent such corresponding amount, such amount
so repaid shall constitute such Bank's Syndicated Loan included in such
Syndicated Borrowing for purposes of this Agreement.
(d) If any Bank makes a new Syndicated Loan hereunder on a day on which
the Borrower is to repay all or any part of an outstanding Syndicated Loan
from such Bank, such Bank shall apply the proceeds of its new Syndicated
Loan to make such repayment and only an amount equal to the difference (if
any) between the amount being borrowed and the amount being repaid shall be
made available by such Bank to the Agent as provided in subsection (c) of
this Section, or remitted by the Borrower to the Agent as provided in
Section 2.12, as the case may be.
(e) Notwithstanding anything to the contrary contained in this Agreement,
no Euro-Dollar Borrowing may be made if there shall have occurred a Default
or an Event of Default, which Default or Event of Default shall not have
been cured or waived in writing.
(f) In the event that a Notice of Borrowing fails to specify whether the
Loans comprising such Borrowing are to be Base Rate Loans or
Euro-Dollar Loans, such Loans shall be made as Base Rate Loans. If the
Borrower is otherwise entitled under this Agreement to repay any Loans
maturing at the end of an Interest Period applicable thereto with the
proceeds of a new Borrowing, and the Borrower fails to repay such Loans
using its own moneys and fails to give a Notice of Borrowing in connection
with such new Borrowing, a new Borrowing shall be deemed to be made on the
date such Loans mature in an amount equal to the principal amount of the
Loans so maturing, and the Loans comprising such new Borrowing shall be
Base Rate Loans.
(g) Notwithstanding anything to the contrary contained herein, (i) there
shall not be more than 10 different Interest Periods outstanding applicable
to Syndicated Loans at the same time (for which purpose Interest Periods
described in different numbered clauses of the definition of the term
"Interest Period" shall be deemed to be different Interest Periods even if
they are coterminous) and (ii) the proceeds of any Base Rate Borrowing
shall be applied first to repay the unpaid principal amount of all Base
Rate Loans (if any) outstanding immediately before such Base Rate
Borrowing.
SECTION 2.03. Money Market Loans. (a) In addition to making Syndicated
Borrowings, the Borrower may, as set forth in this Section, request the
Banks to make offers to make Money Market Loans to the Borrower. The Banks
may, but shall have no obligation to, make such offers and the Borrower
may, but shall have no obligation to, accept any such offers in the manner
23
set forth in this Section, provided that:
(i) there may be no more than 10 different Interest Periods for both
Euro-Dollar Loans and Money Market Loans outstanding at the same time (for
which purpose Interest Periods described in different numbered clauses of
the definition of the term "Interest Period" shall be deemed to be
different Interest Periods even if they are coterminous); and
(ii) the aggregate principal amount of all Money Market Loans, together
with the aggregate principal amount of all Syndicated Loans, at any one
time outstanding shall not exceed the aggregate amount of the Commitments
of all of the Banks at such time.
(b) When the Borrower wishes to request offers to make Money Market
Loans, it shall give the Agent (which shall promptly notify the Banks)
notice substantially in the form of Exhibit E hereto (a "Money Market Quote
Request") so as to be received no later than 12:00 P.M. (Atlanta, Georgia
time) on the Domestic Business Day prior to the date of the Money Market
Borrowing proposed therein (or such other time and date as the Borrower and
the Agent, with the consent of the Required Banks, may agree), specifying:
(i) the proposed date of such Money Market Borrowing, which shall be a
Domestic Business Day (the "Quotation Date");
(ii) the aggregate amount of such Money Market Borrowing, which shall be
at least $5,000,000 (and in larger multiples of $1,000,000) but shall not
cause the limits specified in Section 2.03(a) to be violated; and
(iii) the duration of the Interest Period applicable thereto, which shall
be 7 to 180 days.
The Borrower may request offers to make Money Market Loans for up to
three different Interest Periods in a single Money Market Quote Request;
provided that the request for each separate Interest Period shall be deemed
to be a separate Money Market Quote Request for a separate Money Market
Borrowing. Except as otherwise provided in the immediately preceding
sentence, the Borrower shall not deliver a Money Market Quote Request more
frequently than once every 5 consecutive Domestic Business Days.
(c) (i) Each Bank may, but shall have no obligation to, submit a Money
Market Quote containing an offer to make a Money Market Loan in response to
any Money Market Quote Request; provided that, if the Borrower's request
under Section 2.03(b) specified more than one Interest Period, such Bank
may, but shall have no obligation to, make a single submission containing a
separate offer for each such Interest Period and each such separate offer
shall be deemed to be a separate Money Market Quote. Each Money Market
Quote must be submitted to the Agent not later than 10:00 A.M. (Atlanta,
Georgia time) on the Quotation Date (or such other time and date as the
Borrower and the Agent, with the consent of the Required Banks, may agree);
provided that any Money Market Quote submitted by Wachovia or any Affiliate
of Wachovia may be submitted, and may only be submitted, if Wachovia or
such Affiliate of Wachovia notifies the Borrower of the terms of the offer
contained therein not later than 9:45 A.M. (Atlanta, Georgia time) on the
Quotation Date. Subject to Section 6.01, any Money Market Quote so made
shall be irrevocable except with the written consent of the Agent given on
24
the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit F hereto and shall specify:
(A) the proposed date of the Money Market Borrowing and the duration of
the Interest Period therefor, which shall be 7 to 180 days;
(B) the maximum principal amount of the Money Market Loan which the
quoting Bank is willing to make for the applicable Interest Period, which
principal amount (x) may be greater than or less than the Commitment of the
quoting Bank, (y) shall be at least $5,000,000 or a larger multiple of
$1,000,000, and (z) may not exceed the principal amount of the Money Market
Borrowing for which offers were requested;
(C) the rate of interest per annum (rounded, if necessary, to the
nearest 1/100th of 1%) (the "Money Market Rate") offered for each such
Money Market Loan; and
(D) the identity of the quoting Bank.
Unless otherwise agreed by the Agent and the Borrower, no Money Market
Quote shall contain qualifying, conditional or similar language or propose
terms other than or in addition to those set forth in the applicable Money
Market Quote Request (other than setting forth the maximum principal amount
of the Money Market Loan which the quoting Bank is willing to make for the
applicable Interest Period).
(d) The Agent shall as promptly as practicable after the Money Market
Quote is submitted (but in any event not later than 10:30 A.M. (Atlanta,
Georgia time) on the Quotation Date notify the Borrower of the terms (i) of
any Money Market Quote submitted by a Bank that is in accordance with
Section 2.03(c) and (ii) of any Money Market Quote that amends, modifies or
is otherwise inconsistent with a previous Money Market Quote submitted by
such Bank with respect to the same Money Market Quote Request. Any such
subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest
error in such former Money Market Quote. The Agent's notice to the
Borrower shall specify (A) the maximum aggregate principal amount of the
Money Market Borrowing for which offers have been received and (B) the
maximum principal amount and Money Market Rates so offered by each Bank
(identifying the Bank that made each Money Market Quote).
(e) Not later than 11:00 A.M. (Atlanta, Georgia time) on the Quotation
Date (or such other time and date as the Borrower and the Agent, with the
consent of the Required Banks, may agree), the Borrower shall notify the
Agent of its acceptance or nonacceptance of the offers so notified to it
pursuant to Section 2.03(d) and the Agent shall promptly notify each Bank
that has submitted a Money Market Quote. In the case of acceptance, such
notice shall specify the aggregate principal amount of offers for each
Interest Period that are accepted. The Borrower may accept any Money
Market Quote in whole or in part (provided that any Money Market Quote
accepted in part from any Bank shall not be less than the amount set forth
in the Money Market Quote of such Bank as the minimum principal amount of
the Money Market Loan such Bank was willing to make for the applicable
25
Interest Period); provided that:
(i) the aggregate principal amount of each Money Market Borrowing may not
exceed the applicable amount set forth in the related Money Market Quote
Request;
(ii) the aggregate principal amount of each Money Market Borrowing shall
be at least $5,000,000 (and in larger multiples of $1,000,000) but shall
not cause the limits specified in Section 2.03(a) to be violated;
(iii) acceptance of offers may only be made in ascending order of Money
Market Rates; and
(iv) the Borrower may not accept any offer where the Agent has advised
the Borrower that such offer fails to comply with Section 2.03(c)(ii) or
otherwise fails to comply with the requirements of this Agreement
(including, without limitation, Section 2.03(a)).
If offers are made by two or more Banks with the same Money Market Rates
for a greater aggregate principal amount than the amount in respect of
which offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted
shall be allocated by the Borrower among such Banks as nearly as
practicable (in multiples of $100,000) in proportion to the aggregate
principal amount of such offers. Determinations by the Borrower of the
amounts of Money Market Loans shall be conclusive in the absence of
manifest error.
(f) Any Bank whose offer to make any Money Market Loan has been accepted
shall, not later than 12:00 P.M. (Atlanta, Georgia time) on the Quotation
Date, make the amount of such Loan available to the Agent at its address
referred to in Section 9.01 in immediately available funds. The amount so
received by the Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Borrower on such date by depositing the
same, in immediately available funds, in an account of such Borrower
maintained with Wachovia. Money Market Loans shall not be considered a
utilization of any Bank's Commitment under this Agreement, and any Bank
making a Money Market Loan shall remain obligated to fund its ratable share
of Syndicated Loans, subject to the limitation in Section 2.03(a)(ii).
SECTION 2.04. Notes. (a) The Syndicated Loans of each Bank shall be
evidenced by a single Syndicated Note payable to the order of such Bank for
the account of its Lending Office in an amount equal to the original
principal amount of such Bank's Commitment.
(b) The Money Market Loans made by any Bank to the Borrower shall be
evidenced by a single Money Market Note payable to the order of such Bank
for the account of its Lending Office.
(c) Upon receipt of each Bank's Notes pursuant to Section 3.01, the
Agent shall deliver such Notes to such Bank. Each Bank shall record, and
prior to any transfer of its Notes shall endorse on the schedule forming a
part thereof appropriate notations to evidence, the date, amount and
maturity of, and effective interest rate for, each Loan made by it, the
date and amount of each payment of principal made by the Borrower with
26
respect thereto and whether, in the case of such Bank's Syndicated Note,
such Syndicated Loan is a Base Rate Loan or Euro-Dollar Loan, and such
schedule shall constitute rebuttable presumptive evidence of the principal
amount owing and unpaid on such Bank's Notes; provided that the failure of
any Bank to make, or any error in making, any such recordation or
endorsement shall not affect the obligation of the Borrower hereunder or
under the Notes or the ability of any Bank to assign its Notes. Each Bank
is hereby irrevocably authorized by the Borrower so to endorse its Notes
and to attach to and make a part of any Note a continuation of any such
schedule as and when required.
SECTION 2.05. Maturity of Loans. (a) Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such
Borrowing.
(b) Upon written request of the Borrower, which shall be made in writing
and delivered to the Agent on a Domestic Business Day no fewer than 90 days
prior to the fourth anniversary of the Closing Date, the Banks and the
Agent in their sole and absolute discretion may (but shall not be obligated
to) extend the Termination Date for a period of one year. In the event
that a Bank chooses to extend the Termination Date for such a one year
period, notice shall be given by such Bank to the Borrower and the Agent
not more than 30, nor fewer than 15, days prior to the fourth anniversary
of the Closing Date; provided that the Termination Date shall not be
extended with respect to any of the Banks (regardless of whether any
relevant Bank has delivered a favorable extension notice) unless the
Required Banks have delivered favorable extension notices and are willing
to extend the Termination Date and either (i) the remaining Banks shall on
the original Termination Date (prior to its extension hereunder) purchase
ratable assignments (without any obligations so to do) from each Bank (a
"Terminating Bank") that has not elected to extend the Termination Date (in
the form of an Assignment and Acceptance) in accordance with their
respective percentage of the remaining aggregate amount of the Commitments;
provided that such remaining Banks shall be provided such opportunity
(which opportunity shall allow such Banks at least five Domestic Business
Days in which to make a decision) prior to the Borrower finding another
bank pursuant to the immediately succeeding clause (ii); and provided,
further, that should any of the remaining Banks elect not to purchase such
an assignment, then such other remaining Banks shall be entitled to
purchase an assignment on the original Termination Date (prior to its
extension hereunder) from any Terminating Bank which includes the ratable
interest that was otherwise available to such non-purchasing remaining Bank
or Banks, as the case may be; (ii) the Borrower shall find another bank,
acceptable to the Agent, willing to accept an assignment on the original
Termination Date (prior to its extension hereunder) from such Terminating
Bank (in the form of an Assignment and Acceptance); or (iii) the Borrower
shall terminate the Commitments of all such Terminating Banks whose
Commitments are not assigned pursuant to clause (i) or (ii) above.
SECTION 2.06. Interest Rates. (a) "Applicable Margin" shall be
determined quarterly based upon the ratio of Consolidated Funded Debt to
Consolidated Total Capital (calculated as of the last day of each Fiscal
Quarter beginning with the Fiscal Quarter ending December 31, 1996 and in
the manner set forth in Section 5.03), as follows:
27
Ratio of Consolidated Funded
Debt to Consolidated Total Capital Base Rate Loans Euro-Dollar Loans
Greater than or equal to .50 0% .375%
Greater than or equal to .35
but less than .50 0% .25%
Greater than or equal to .20
but less than .35 0% .20%
Less than .20 0% .17%
The Applicable Margin shall be determined effective as of the date (herein,
the "Rate Determination Date") which is 45 days after the last day of the
Fiscal Quarter as of the end of which the foregoing ratio is being
determined, based on the quarterly financial statements for such Fiscal
Quarter, and the Applicable Margin so determined shall remain effective
from such Rate Determination Date until the date which is 45 days after the
last day of the Fiscal Quarter in which such Rate Determination Date falls
(which latter date shall be a new Rate Determination Date); provided that
(i) for the period from and including the Closing Date to but excluding the
Rate Determination Date next following the Fiscal Quarter ending December
31, 1996, the Applicable Margin shall be (A) 0% for Base Rate Loans, and
(B) .20% for Euro-Dollar Loans, (ii) in the case of each Applicable Margin
determined on the Rate Determination Date which is 45 days after the fourth
and final Fiscal Quarter of a Fiscal Year, such Applicable Margin shall be
redetermined based upon the annual audited financial statements for the
Fiscal Year ended on the last day of such final Fiscal Quarter and if such
Applicable Margin (as so redetermined) shall be different from the
Applicable Margin determined on the related Rate Determination Date, such
Applicable Margin (as so redetermined) shall be effective retroactive to
the related Rate Determination Date, and (iii) if on any Rate Determination
Date the Borrower shall have failed to deliver to the Banks the financial
statements required to be delivered pursuant to Section 5.01(b) with
respect to the Fiscal Quarter most recently ended prior to such Rate
Determination Date, then for the period beginning on such Rate
Determination Date and ending on the earlier of (A) the date on which the
Borrower shall deliver to the Banks the financial statements required to be
delivered pursuant to Section 5.01(b) with respect to such Fiscal Quarter
or any subsequent Fiscal Quarter, or (B) the date on which the Borrower
shall deliver to the Banks annual financial statements required to be
delivered pursuant to Section 5.01(a) with respect to the Fiscal Year which
includes such Fiscal Quarter or any subsequent Fiscal Year, the Applicable
Margin shall be determined as if the ratio of Consolidated Funded Debt to
Consolidated Total Capital was greater than or equal to .50 at all times
during such period. Any change in the Applicable Margin on any Rate
Determination Date shall result in a corresponding change, effective on and
as of such Rate Determination Date, in the interest rate applicable to each
Syndicated Loan outstanding on such Rate Determination Date.
(b) Each Base Rate Loan shall bear interest on the outstanding principal
amount thereof, for each day from the date such Loan is made until it
28
becomes due, at a rate per annum equal to the Base Rate for such day plus
the Applicable Margin. Such interest shall be payable for each Interest
Period on the last day thereof. Any overdue principal of and, to the
extent permitted by applicable law, overdue interest on any Base Rate Loan
shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a
rate per annum equal to the sum of the Applicable Margin plus the
applicable Adjusted London Interbank Offered Rate for such Interest Period;
provided that if any Euro-Dollar Loan shall, as a result of clause (1)(c)
of the definition of Interest Period, have an Interest Period of less than
one month, such Euro-Dollar Loan shall bear interest during such Interest
Period at the rate applicable to Base Rate Loans during such period. Such
interest shall be payable for each Interest Period on the last day thereof
and, if such Interest Period is longer than 3 months, at intervals of 3
months after the first day thereof.
The "Adjusted London Interbank Offered Rate" applicable to any Interest
Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100th of 1%) by dividing (i) the
applicable London Interbank Offered Rate for such Interest Period by
(ii) 1.00 minus the Euro-Dollar Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Euro-Dollar Loan
means for the Interest Period of such Euro-Dollar Loan the rate per annum
determined on the basis of the rate for deposits in Dollars of amounts
equal or comparable to the principal amount of such Euro-Dollar Loan
offered for a term comparable to such Interest Period, which rates appear
on the display designated as page "3750" of the Telerate Service (or such
other page as may replace page 3750 of that service or such other service
or services as may be nominated by the British Bankers' Association for the
purpose of displaying London Interbank offered rates for deposits in
Dollars) determined as of 10:00 a.m. (New York time) 2 Euro-Dollar Business
Days prior to the first day of such Interest Period.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by
the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the
Federal Reserve System in respect of "Eurocurrency liabilities" (or in
respect of any other category of liabilities which includes deposits by
reference to which the interest rate on Euro-Dollar Loans is determined or
any category of extensions of credit or other assets which includes loans
by a non-United States office of any Bank to United States residents). The
Adjusted London Interbank Offered Rate shall be adjusted automatically on
and as of the effective date of any change in the Euro-Dollar Reserve
Percentage.
29
(d) Any overdue principal of and, to the extent permitted by law,
overdue interest on any Euro-Dollar Loan shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the Default
Rate.
(e) Each Money Market Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a
rate per annum equal to the Money Market Rate for such Loan quoted by the
Bank making such Loan in accordance with Section 2.03. Such interest shall
be payable for such Interest Period on the last day thereof and, if such
Interest Period is longer than 90 days, at intervals of 90 days after the
first day thereof. Any overdue principal of and, to the extent permitted
by law, overdue interest on any Money Market Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the
Default Rate.
(f) The Agent shall determine each interest rate applicable to the Loans
hereunder. The Agent shall give prompt notice to the Borrower and the
Banks by telecopy of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(g) After the occurrence and during the continuance of an Event of
Default, the principal amount of the Loans (and, to the extent permitted by
applicable law, all accrued interest thereon) shall bear interest at the
Default Rate.
SECTION 2.07. Fees. (a) The Borrower shall pay to the Agent for the
ratable account of each Bank a facility fee equal to the product of:
(i) the aggregate of the daily average amounts of such Bank's Commitment
(irrespective of usage), times (ii) a per annum percentage equal to the
Applicable Facility Fee Rate. Such facility fee shall accrue from and
including the Closing Date to but excluding the Termination Date. Facility
fees shall be payable quarterly in arrears on the Facility Fee Payment Date
next following each Facility Fee Determination Date and on the Termination
Date; provided that should the Commitments be terminated at any time prior
to the Termination Date for any reason, the entire accrued and unpaid
facility fee shall be paid on the date of such termination. The
"Applicable Facility Fee Rate" shall be determined quarterly based upon the
ratio of Consolidated Funded Debt to Consolidated Total Capital (calculated
as of the last day of each Fiscal Quarter beginning with the Fiscal Quarter
ending December 31, 1996 and in the manner set forth in Section 5.03) as
follows:
30
Ratio of Consolidated Applicable
Funded Debt to Facility Fee Rate
Consolidated Total Capital
Greater than or equal to .50 .175%
Greater than or equal to .35
but less than .50 .125%
Greater than or equal to .20
but less than .35 .10%
Less than .20 .08%
The Applicable Facility Fee Rate shall be determined effective as of the
date (herein, the "Facility Fee Determination Date") which is 45 days after
the last day of the Fiscal Quarter as of the end of which the foregoing
ratio is being determined, based on the quarterly financial statements for
such Fiscal Quarter, and the Applicable Facility Fee Rate so determined
shall remain effective from such Facility Fee Determination Date until the
date which is 45 days after the last day of the Fiscal Quarter in which
such Facility Fee Determination Date falls (which latter date shall be a
new Facility Fee Determination Date); provided that (i) for the period from
and including the Closing Date to but excluding the Facility Fee
Determination Date next following the Fiscal Quarter ending December 31,
1996, the Applicable Facility Fee Rate shall be .10%; (ii) in the case of
each Applicable Facility Fee Rate determined on the Facility Fee
Determination Date which is 45 days after the fourth and final Fiscal
Quarter of a Fiscal Year, such Applicable Facility Fee Rate shall be
redetermined based upon the annual audited financial statements for the
Fiscal Year ended on the last day of such final Fiscal Quarter and if such
Applicable Facility Fee Rate (as so redetermined) shall be different from
the Applicable Facility Fee Rate determined on the related Facility Fee
Determination Date, such Applicable Facility Fee Rate (as so redetermined)
shall be effective retroactive to the related Facility Fee Determination
Date, and (iii) if on any Facility Fee Determination Date the Borrower
shall have failed to deliver to the Banks the financial statements required
to be delivered pursuant to Section 5.01(b) with respect to the Fiscal
Quarter most recently ended prior to such Facility Fee Determination Date,
then for the period beginning on such Facility Fee Determination Date and
ending on the earlier of (A) the date on which the Borrower shall deliver
to the Banks the financial statements required to be delivered pursuant to
Section 5.01(b) with respect to such Fiscal Quarter or any subsequent
31
Fiscal Quarter, and (B) the date on which the Borrower shall deliver to the
Banks annual financial statements required to be delivered pursuant to
Section 5.01(a) with respect to the Fiscal Year which includes such Fiscal
Quarter or any subsequent Fiscal Year, the Applicable Facility Fee Rate
shall be determined as if the ratio of Consolidated Funded Debt to
Consolidated Total Capital was greater than or equal to .50 at all times
during such period.
(b) The Borrower shall pay to the Agent, for the account and sole
benefit of the Agent, such fees and other amounts at such times as set
forth in the Agent's Letter Agreement.
SECTION 2.08. Optional Termination or Reduction of Commitments. The
Borrower may, upon at least 3 Domestic Business Days' notice to the Agent,
terminate at any time, or proportionately reduce from time to time by an
aggregate amount of at least $10,000,000 or any larger multiple of
$1,000,000, the Commitments. If the Commitments are terminated in their
entirety, all accrued fees (as provided under Section 2.07) shall be
payable on the effective date of such termination.
SECTION 2.09. Mandatory Termination of Commitments. The Commitments
shall terminate on the Termination Date and any Loans then outstanding
(together with accrued interest thereon) shall be due and payable on such
date.
SECTION 2.10. Optional Prepayments. (a) The Borrower may, on the same
Domestic Business Day's notice to the Agent, prepay any Base Rate Borrowing
in whole at any time, or from time to time in part in amounts aggregating
at least $1,000,000, or any larger multiple of $1,000,000, by paying the
principal amount to be prepaid together with accrued interest thereon to
the date of prepayment. Each such optional prepayment shall be applied to
prepay ratably the Base Rate Loans of the several Banks included in such
Base Rate Borrowing.
(b) The Borrower may not prepay all or any portion of the principal
amount of any Euro-Dollar Loan or any Money Market Loan prior to the
maturity thereof unless all compensation due under Section 8.05 is paid in
connection with and at the time of such prepayment.
(c) Upon receipt of a notice of prepayment pursuant to this Section, the
Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.11. Mandatory Prepayments. On each date on which the
Commitments are reduced or terminated pursuant to Section 2.08 or
terminated pursuant to Section 2.09, the Borrower shall repay or prepay (a)
in the case of a termination of the Commitments, the entire principal
32
amount of the outstanding Loans, or (b) in the case of a reduction of the
Commitments, such principal amount of the outstanding Loans, if any
(together with interest accrued thereon and any amounts due under Section
8.05(a)), as may be necessary so that after such payment the aggregate
unpaid principal amount of the Loans does not exceed the aggregate amount
of the Commitments as then reduced. Each such payment or prepayment shall
be applied to repay or prepay ratably the Loans of the several Banks;
provided that such prepayment shall be applied, first, to Syndicated Loans
outstanding on the date of such prepayment (in direct order of maturity)
and then, to the extent necessary, to Money Market Loans outstanding on the
date of such prepayment (in direct order of maturity).
SECTION 2.12. General Provisions as to Payments. (a) The Borrower shall
make each payment of principal of, and interest on, the Loans and of
facility fees hereunder, not later than 12:00 noon (Atlanta, Georgia time)
on the date when due, in Federal or other funds immediately available in
Atlanta, Georgia, to the Agent at its address referred to in Section 9.01.
The Agent will promptly distribute to each Bank its ratable share of each
such payment received by the Agent for the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the Base Rate
Loans or the Money Market Loans or of fees shall be due on a day which is
not a Domestic Business Day, the date for payment thereof shall be extended
to the next succeeding Domestic Business Day. Whenever any payment of
principal of, or interest on, the Euro-Dollar Loans shall be due on a day
which is not a Euro-Dollar Business Day, the date for payment thereof shall
be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business
Day. If the date for any payment of principal is extended by operation of
law or otherwise, interest thereon shall be payable for such extended time.
(c) All payments of principal, interest and fees and all other amounts to
be made by the Borrower pursuant to this Agreement with respect to any Loan
or fee relating thereto shall be paid without deduction for, and free from,
any tax, imposts, levies, duties, deductions, or withholdings of any nature
now or at anytime hereafter imposed by any governmental authority or by any
taxing authority thereof or therein excluding in the case of each Bank,
taxes imposed on or measured by its income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Bank is organized or
any political subdivision thereof and, in the case of each Bank, taxes
imposed on its income, and franchise taxes imposed on it, by the
jurisdiction of such Bank's applicable Lending Office or any political
subdivision thereof (all such non-excluded taxes, imposts, levies, duties,
deductions or withholdings of any nature being "Taxes"). In the event that
the Borrower is required by applicable law to make any such withholding or
deduction of Taxes with respect to any Loan or fee or other amount, the
Borrower shall pay such deduction or withholding to the applicable taxing
33
authority, shall promptly furnish to any Bank in respect of which such
deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Bank additional amounts as
may be necessary in order that the amount received by such Bank after the
required withholding or other payment shall equal the amount such Bank
would have received had no such withholding or other payment been made. If
no withholding or deduction of Taxes are payable in respect of any Loan or
fee relating thereto, the Borrower shall furnish any Bank, at such Bank's
request, a certificate from each applicable taxing authority or an opinion
of counsel acceptable to such Bank, in either case stating that such
payments are exempt from or not subject to withholding or deduction of
Taxes. If the Borrower fails to provide such original or certified copy of
a receipt evidencing payment of Taxes or certificate(s) or opinion of
counsel of exemption, the Borrower hereby agrees to compensate such Bank
for, and indemnify them with respect to, the tax consequences of the
Borrower's failure to provide evidence of tax payments or tax exemption.
In the event any Bank receives a refund of any Taxes paid by the Borrower
pursuant to this Section 2.12(c), it will pay to the Borrower the amount of
such refund promptly upon receipt thereof; provided, however, if at any
time thereafter it is required to return such refund, the Borrower shall
promptly repay to it the amount of such refund.
(d) Each Bank which shall be a foreign person (a person other than a
United States person for United States Federal income tax purposes) hereby
agrees that:
(i) it shall no later than the Closing Date (or, in the case of a Bank
which shall become a party hereto pursuant to Section 9.07 after the
Closing Date, the date upon which such Bank shall become a party hereto)
deliver to the Borrower (with a copy to the Agent) (A) if any Lending
Office is located in the United States, two (2) accurate and complete
signed originals of Internal Revenue Service Form 4224 (or any successors
thereto) ("Form 4224"), and/or (B) if any Lending Office is located outside
the United States, two (2) accurate and complete signed originals of
Internal Revenue Service Form 1001 (or any successor thereto) ("Form
1001"), in each case indicating that such Bank is on the date of delivery
thereof entitled to receive payments of principal, interest and fees for
the account of such Lending Office or Lending Offices under this Agreement
free from withholding of United States Federal income tax, in the case of
Form 1001, pursuant to a United States tax treaty currently in effect and
for which notice of termination has not been given (and, if any political
subdivision of the United States shall impose similar reporting
requirements with respect to payments to such Bank under this Agreement and
such Bank shall receive notice from the Borrower of the same, such Bank
shall deliver any applicable forms to the Borrower with a copy to the Agent
promptly after receipt of such notice);
34
(ii) if at any time such Bank shall change its Lending Office or Lending
Offices or select an additional Lending Office as herein provided, it
shall, at the same time or reasonably promptly thereafter, deliver to the
Borrower (with a copy to the Agent) in replacement for, or in addition to,
the forms previously delivered by it hereunder (A) if such changed or
additional Lending Office is located in the United States, two (2) accurate
and complete signed originals of Form 4224 or (B) otherwise, two (2)
accurate and complete signed originals of Form 1001, in each case
indicating that such Bank is on the date of delivery thereof entitled to
receive payments of principal, interest and fees for the account of such
changed or additional Lending Office under this Agreement free from
withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event
(including the passing of time but excluding any event mentioned in (ii)
above) requiring a change in the most recent Form 4224 or Form 1001
previously delivered by such Bank and if the delivery of the same be
lawful, deliver to the Borrower (with a copy to the Agent) two (2) accurate
and complete original signed copies of Form 4224 or Form 1001 in
replacement for the forms previously delivered by such Bank;
(iv) if such Bank claims exemption from withholding tax under a United
States tax treaty by providing a Form 1001 and such Bank sells or grants a
participation of all or part of its rights under this Agreement, such Bank
shall notify the Borrower and the Agent of the percentage amount in which
it is no longer the beneficial owner under this Agreement. To the extent
of this percentage amount, the Borrower shall treat such Bank's Form 1001
as no longer in compliance with this Section 2.12(d). In the event a Bank
claiming exemption from United States withholding tax by filing Form 4224
with the Borrower, sells or grants a participation in its rights under this
Agreement, such Bank agrees to undertake sole responsibility for complying
with the withholding tax requirements imposed by Sections 1441 and 1442 of
the Code;
(v) if the Internal Revenue Service or any authority of the United
States of America or other jurisdiction successfully asserts a claim that
the Agent or the Borrower did not properly withhold tax from amounts paid
to or for the account of any Bank (because the appropriate form was not
delivered, was not properly executed, or because such Bank failed to notify
the Borrower or the Agent of a change in circumstances which rendered the
exemption from withholding tax ineffective), such Bank shall indemnify the
Agent and/or the Borrower, as applicable, fully for all amounts paid,
directly or indirectly, by the Agent and/or the Borrower, as applicable, as
tax or otherwise, including penalties and interest, and including any taxes
imposed by any jurisdiction on the amounts payable to the Agent and/or the
Borrower, as applicable under this paragraph (d), together with all costs,
expenses and attorneys' fees (including the reasonable allocated costs for
in-house staff counsel); and
35
(vi) it shall, promptly upon the Agent's or the Borrower's reasonable
request to that effect, deliver to the Borrower (with a copy to the Agent)
such other forms or similar documentation as may be required from time to
time by any applicable law, treaty, rule or regulation in order to
establish such Bank's tax status for withholding purposes.
(e) The Borrower will not be required to pay any additional amounts in
respect of United States Federal income tax pursuant to Section 2.12(c) to
any Bank for the account of any Lending Office of such Bank:
(i) if the obligation to pay such additional amounts would not have
arisen but for a failure by such Bank to comply with its obligations under
Section 2.12(d) in respect of such Lending Office;
(ii) if such Bank shall have delivered to the Borrower a Form 4224 in
respect of such Lending Office pursuant to Section 2.12(d) and such Bank
shall not at any time be entitled to exemption from deduction or
withholding of United States Federal income tax in respect of payments by
the Borrower hereunder for the account of such Lending Office for any
reason other than a change in United States law or regulations or in the
official interpretation of such law or regulations by any Governmental
Authority charged with the interpretation or administration thereof
(whether or not having the force of law) after the date of delivery of such
Form 4224; or
(iii) if such Bank shall have delivered to the Borrower a Form 1001 in
respect of such Lending Office pursuant to Section 2.12(d) and such Bank
shall not at any time be entitled to exemption from deduction or
withholding of United States Federal income tax in respect of payments by
the Borrower hereunder for account of such Lending Office for any reason
other than a change in United States law or regulations or any applicable
tax treaty or regulations or in the official interpretation of any such
law, treaty or regulations by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force
of law) after the date of delivery of such Form 1001.
(f) If, at any time, the Borrower shall request any Bank to deliver any
forms or other documentation pursuant to Section 2.12(d)(iv), then the
Borrower shall, on demand of such Bank, reimburse such Bank for any
reasonable costs or expenses incurred by such Bank in the preparation or
delivery of such forms or other documentation.
(g) If the Borrower shall be required to pay additional amounts to any
Bank pursuant to Section 2.12(c), then such Bank shall use its best efforts
(consistent with legal and regulatory restrictions) to change the
jurisdiction of its Lending Office so as to eliminate any such additional
payment by the Borrower which may thereafter accrue if such change in the
36
judgment of such Bank shall not otherwise be disadvantageous to such Bank.
(h) The agreements and obligations of the Borrower contained in Section
2.12(c) shall survive for ten (10) years after the termination of the
Commitments and the payment of all amounts payable under this Agreement.
(i) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.12 shall be applicable with respect to any
Participant, Assignee or other Transferee, and any calculations required by
such provisions (i) shall be made based upon the circumstances of such
Participant, Assignee or other Transferee, and (ii) constitute a continuing
agreement and shall survive the termination of this Agreement and the
payment in full or cancellation of the Notes.
SECTION 2.13. Computation of Interest and Fees. Interest on Base Rate
Loans shall be computed on the basis of a year of 365 or 366 days, as
appropriate, and paid for the actual number of days elapsed (including the
first day but excluding the last day). Interest on Euro-Dollar Loans and
interest on Money Market Loans shall be computed on the basis of a year of
360 days and paid for the actual number of days elapsed, calculated as to
each Interest Period from and including the first day thereof to but
excluding the last day thereof. Facility fees and any other fees payable
hereunder shall be computed on the basis of a year of 360 days and paid for
the actual number of days elapsed (including the first day but excluding
the last day).
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing. The obligation of each
Bank to make a Loan on the occasion of the first Borrowing is subject to
the satisfaction of the conditions set forth in Section 3.02 and the
following additional conditions:
(a) receipt by the Agent (i) from each of the parties hereto, of a duly
executed counterpart of this Agreement signed by such party, (ii) from each
of the parties thereto, of a duly executed counterpart of the Pledge
Agreement signed by such party and (iii) from each of the parties thereto,
of a duly executed counterpart of the Guaranty Agreement signed by such
party;
(b) receipt by the Agent of a duly executed Syndicated Note and a duly
executed Money Market Note for the account of each Bank complying with the
provisions of Section 2.04;
(c) receipt by the Agent of an opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for
37
the Borrower, the Pledgor and the Guarantors, dated as of the Closing Date,
substantially in the form of Exhibit C hereto and covering such additional
matters relating to the transactions contemplated hereby as the Agent or
any Bank may reasonably request;
(d) receipt by the Agent of an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ &
▇▇▇▇, special counsel for the Agent, dated as of the Closing Date,
substantially in the form of Exhibit D hereto and covering such additional
matters relating to the transactions contemplated hereby as the Agent may
reasonably request;
(e) receipt by the Agent of a certificate (the "Closing Certificate"),
dated the date of the first Borrowing, substantially in the form of Exhibit
G hereto, signed by a principal financial officer of the Borrower, to the
effect that (i) no Default has occurred and is continuing on the date of
the first Borrowing and (ii) the representations and warranties of the
Borrower contained in Article IV are true in all material respects on and
as of the date of the first Borrowing hereunder;
(f) receipt by the Agent of all documents which the Agent or any Bank
may reasonably request relating to the existence of the Borrower and each
Guarantor, the corporate authority for and the validity of this Agreement,
the Pledge Agreement, the Guaranty Agreement and the Notes, and any other
matters relevant hereto, all in form and substance satisfactory to the
Agent, including without limitation a certificate of incumbency of the
Borrower and each Guarantor (the "Officer's Certificate"), signed by the
Secretary or an Assistant Secretary of the Borrower or each Guarantor, as
the case may be, substantially in the form of Exhibit H hereto, certifying
as to the names, true signatures and incumbency of the officer or officers
of the Borrower or each Guarantor authorized to execute and deliver the
Loan Documents to which the Borrower or each Guarantor is a party, and
certified copies of the following items: (i) the Certificate or Articles
of Incorporation of the Borrower and each Guarantor, (ii) the Bylaws of the
Borrower and each Guarantor, (iii) a certificate of the Secretary of State
of the State of Delaware as to the good standing of the Borrower as a
Delaware corporation and similar certificates for each Guarantor from its
jurisdiction of incorporation, and (iv) the action taken by the Board of
Directors of the Borrower and each Guarantor authorizing the Borrower's and
Guarantors' execution, delivery and performance of this Agreement, the
Notes and the other Loan Documents to which the Borrower and each Guarantor
is a party;
(g) receipt by the Agent of a Notice of Borrowing (in the case of a
Syndicated Borrowing) or a Money Market Quote Request (in the case of a
Money Market Borrowing);
(h) receipt by the Agent of (i) the Pledged Shares, together with stock
powers executed by the Pledgor in blank and (ii) satisfactory evidence that
38
the Agent has a perfected, first-priority lien or security interest in all
of the Pledged Shares and that the Pledged Shares are not encumbered by any
other Lien; and
(i) evidence satisfactory to the Agent of the termination of the Prior
Credit Agreements and all other Loan Documents (as defined in the Prior
Credit Agreements) and cancellation of all Liens granted to secure
obligations of the Pledgor thereunder.
SECTION 3.02. Conditions to All Borrowings. The obligation of each Bank
to make a Loan on the occasion of each Borrowing is subject to the
satisfaction of the following conditions:
(a) either (i) receipt by the Agent of Notice of Borrowing as required
by Section 2.02 (if such Borrowing is a Syndicated Borrowing), or (ii)
compliance with the provisions of Section 2.03 (if such Borrowing is a
Money Market Borrowing);
(b) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the Borrower
contained in Article IV of this Agreement shall be true in all material
respects on and as of the date of such Borrowing; and
(d) the fact that, immediately after such Borrowing (i) the aggregate
outstanding principal amount of the Syndicated Loans of each Bank will not
exceed the amount of its Commitment and (ii) the aggregate outstanding
principal amount of the Loans will not exceed the aggregate amount of the
Commitments of all of the Banks as of such date.
Each Borrowing hereunder shall be deemed to be a representation and
warranty by the Borrower on the date of such Borrowing as to the truth and
accuracy of the facts specified in clauses (b), (c) and (d) of this
Section; provided that such Borrowing shall not be deemed to be such a
representation and warranty to the effect set forth in Section 4.04(b) as
to any event, act or condition having a Material Adverse Effect which has
theretofore been disclosed in writing by the Borrower to the Banks if the
aggregate outstanding principal amount of the Loans immediately after such
Borrowing will not exceed the aggregate outstanding principal amount
thereof immediately before such Borrowing.
39
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is a
corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, is duly qualified to
transact business in every jurisdiction where, by the nature of its
business, such qualification is necessary, and has all corporate powers and
all governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of
this Agreement, the Notes and the other Loan Documents (i) are within the
Borrower's corporate powers, (ii) have been duly authorized by all
necessary corporate action, (iii) require no action by or in respect of, or
filing with, any governmental body, agency or official, except for any
actions or filings which have been taken or made, as the case may be,
(iv) do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of incorporation or
by-laws of the Borrower or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrower or any of its
Subsidiaries, and (v) do not result in the creation or imposition of any
Lien on any asset of the Borrower or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a valid and
binding agreement of the Borrower enforceable in accordance with its terms,
and the Notes and the other Loan Documents, when executed and delivered in
accordance with this Agreement, will constitute valid and binding
obligations of the Borrower enforceable in accordance with their respective
terms, provided that the enforceability hereof and thereof is subject in
each case to general principles of equity and to bankruptcy, insolvency and
similar laws affecting the enforcement of creditors' rights generally.
SECTION 4.04. Financial Information. (a) The consolidated balance sheet
of the Borrower and its Consolidated Subsidiaries as of March 31, 1996 and
the related consolidated statements of income, shareholders' equity and
cash flows for the Fiscal Year then ended, reported on by KPMG Peat Marwick
LLP, copies of which have been delivered to each of the Banks, and the
unaudited consolidated financial statements of the Borrower for the interim
period ended June 30,1996, copies of which have been delivered to each of
the Banks, fairly present, in conformity with GAAP, the consolidated
financial position of the Borrower and its Consolidated Subsidiaries as of
such dates and their consolidated results of operations and cash flows for
such periods stated.
40
(b) Since March 31, 1996, there has been no event, act, condition or
occurrence having a Material Adverse Effect.
SECTION 4.05. Litigation. Except as set forth on Schedule 4.05, there
is no action, suit or proceeding pending, or to the knowledge of the
Borrower threatened, against or affecting the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body,
agency or official which could reasonably be expected to have or cause a
Material Adverse Effect.
SECTION 4.06. Compliance with ERISA. (a) The Borrower and each member
of the Controlled Group have fulfilled their obligations under the minimum
funding standards of ERISA and the Code with respect to each Plan and are
in compliance in all material respects with the presently applicable
provisions of ERISA and the Code, and have not incurred any liability which
has not been extinguished to the PBGC or a Plan under Title IV of ERISA,
other than a liability to the PBGC for premiums not yet due or a liability
to a Plan for contributions not yet due.
(b) Neither the Borrower nor any member of the Controlled Group is or,
within the 5 years preceding the Closing Date, has been obligated to
contribute to any Multiemployer Plan.
SECTION 4.07. Taxes. There have been filed on behalf of the Borrower
and its Subsidiaries all Federal, material state and local income, excise,
property and other tax returns which are required to be filed by them and
all taxes due pursuant to such returns or pursuant to any assessment
received by or on behalf of the Borrower or any Subsidiary have been paid,
except for those taxes being contested in good faith with due diligence by
appropriate proceedings for which appropriate reserves have been maintained
as required under GAAP. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of taxes or other governmental
charges are, in the opinion of the Borrower, adequate.
SECTION 4.08. Subsidiaries. (a) Each of the Borrower's Subsidiaries is
a corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation, is duly qualified to
transact business in every jurisdiction where, by the nature of its
business, such qualification is necessary, and has all corporate powers and
all governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted. As of the Closing Date, the
Borrower has no Subsidiaries except those Subsidiaries listed on Schedule
4.08A, which accurately sets forth each such Subsidiary's complete name and
jurisdiction of incorporation.
(b) The Domestic Significant Subsidiaries in existence on the Closing
Date are listed on Schedule 4.08B, which accurately sets forth as of such
41
date each such Domestic Significant Subsidiary's complete name and
jurisdiction of incorporation.
(c) The Foreign Significant Subsidiaries in existence on the Closing
Date are listed on Schedule 4.08C, which accurately sets forth as of such
date each such Foreign Significant Subsidiary's complete name and
jurisdiction of incorporation.
SECTION 4.09. Not an Investment Company. Neither the Borrower nor any
of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 4.10 Public Utility Holding Company Act. Neither the Borrower
nor any of its Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company"
or of a "subsidiary company" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each of the Borrower and
its Consolidated Subsidiaries has title to or other rights in its material
properties sufficient for the conduct of its business, and none of such
property is subject to any Lien except as permitted in Section 5.09.
SECTION 4.12. No Default. Neither the Borrower nor any of its
Consolidated Subsidiaries is in default under or with respect to any
agreement, instrument or undertaking to which it is a party or by which it
or any of its property is bound which could reasonably be expected to have
or cause a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore furnished by
the Borrower to the Agent or any Bank for purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished by the Borrower to the Agent or any Bank
will be, true, accurate and complete in every material respect or based on
reasonable estimates on the date as of which such information is stated or
certified. The Borrower has disclosed to the Banks in writing any and all
facts of which it has knowledge as of the Closing Date which could
reasonably be expected to have or cause a Material Adverse Effect.
SECTION 4.14. Environmental Matters. (a) Except as set forth on
Schedule 4.14 A-1, neither the Borrower nor any Subsidiary is subject to
any Environmental Liability which could reasonably be expected to have or
cause a Material Adverse Effect and neither the Borrower nor any Subsidiary
has been designated as a potentially responsible party under CERCLA or
under any state statute similar to CERCLA if such designation could
reasonably be expected to have or cause, alone or in the aggregate a
Material Adverse Effect. Except as set forth on Schedule 4.14 A-2, none of
42
the Properties has been identified on any current or (to the best of the
Borrower's knowledge) proposed (i) National Priorities List under 40 C.F.R.
Section 300, (ii) CERCLIS list or (iii) any list arising from a state
statute similar to CERCLA.
(b) No Hazardous Materials have been (at any time after the Properties
hereinafter referred to were owned, leased or otherwise used or occupied by
the Borrower or any Subsidiary or, to the best knowledge of the Borrower,
at any time before the Properties hereinafter referred to were owned,
leased or otherwise used or occupied by the Borrower or any Subsidiary) or
are being used, produced, manufactured, processed, treated, recycled,
generated, stored, disposed of, managed or otherwise handled at, or shipped
or transported to or from the Properties or are otherwise present at, on,
in or under the Properties, or, to the best of the knowledge of the
Borrower, at or from any adjacent site or facility, except for Hazardous
Materials used in the manufacturing process and other Hazardous Materials
used, produced, manufactured, processed, treated, recycled, generated,
stored, disposed of, and managed or otherwise handled in the ordinary
course of business in compliance with all applicable Environmental
Requirements, except for such noncompliance which could not reasonably be
expected to have or cause a Material Adverse Effect.
(c) The Borrower and each of its Subsidiaries has procured all
Environmental Authorizations necessary for the conduct of its business, and
is in compliance with all Environmental Requirements in connection with the
operation of the Properties and the Borrower's and each of its Subsidiary's
respective businesses, except to the extent failure to so procure or
comply, as the case may be, could not reasonably be expected to have or
cause a Material Adverse Effect.
SECTION 4.15. Compliance with Laws. The Borrower and each Subsidiary is
in compliance with all applicable laws, including, without limitation, all
Environmental Laws, except where any failure to comply with any such laws
could not reasonably be expected to have or cause, alone or in the
aggregate, a Material Adverse Effect.
SECTION 4.16. Capital Stock. All Capital Stock, debentures, bonds,
notes and all other securities of the Borrower and its Subsidiaries
presently issued and outstanding are validly and properly issued in
accordance in all material respects with all applicable laws, including,
but not limited to, the "Blue Sky" laws of all applicable states and the
federal securities laws. The issued shares of Capital Stock of the
Borrower's Wholly Owned Subsidiaries are owned by the Borrower or a
Wholly-Owned Subsidiary free and clear of any Lien or adverse claim (other
than the Lien created pursuant to the Pledge Agreement, any future Lien
created pursuant to a pledge agreement executed by the Borrower or a
Pledgor Subsidiary pursuant to Section 5.21(b) hereof or any Lien for taxes
not yet due). At least a majority of the issued shares of capital stock of
43
each of the Borrower's other Subsidiaries (other than Wholly Owned
Subsidiaries) is owned by the Borrower or a Subsidiary free and clear of
any Lien or adverse claim (other than the Lien created pursuant to the
Pledge Agreement or any future Lien created pursuant to a pledge agreement
executed by the Borrower or any Pledgor Subsidiary pursuant to Section
5.21(b) hereof).
SECTION 4.17. Margin Stock. No part of the proceeds of any Loan will be
used for any purpose which violates, or which is inconsistent with, the
provisions of Regulations G, T, U or X.
SECTION 4.18. Insolvency. After giving effect to the execution and
delivery of the Loan Documents and the making of the Loans under this
Agreement, neither the Borrower nor any Significant Subsidiary or Guarantor
will be "insolvent," within the meaning of such term as used in O.C.G.A.
Section 18-2-22 or as defined in Section 101 of Title 11 of the United
States Code or Section 2 of the Uniform Fraudulent Transfer Act, or any
other applicable state law pertaining to fraudulent transfers, as each may
be amended from time to time, or be unable to pay its debts generally as
such debts become due, or have an unreasonably small capital to engage in
any business or transaction, whether current or contemplated.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to each of the
Banks:
(a) as soon as available and in any event within 90 days after the end
of each Fiscal Year, a consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of income, shareholders' equity and cash flows for
such Fiscal Year, setting forth in each case in comparative form the
figures for the previous fiscal year, all certified by KPMG Peat Marwick
LLP or other independent public accountants of nationally recognized
standing, with such certification to be free of exceptions and
qualifications not acceptable to the Required Banks;
(b) as soon as available and in any event within 45 days after the end
of each Fiscal Quarter of each Fiscal Year, a consolidated unaudited
balance sheet of the Borrower and its Consolidated Subsidiaries as of the
end of such Fiscal Quarter and the related unaudited statement of income
and unaudited statement of cash flows for such Fiscal Quarter and for the
portion of the Fiscal Year ended at the end of such Fiscal Quarter, setting
44
forth in each case in comparative form the figures for the corresponding
Fiscal Quarter and the corresponding portion of the previous Fiscal Year,
all certified (subject to normal year-end adjustments and to the absence of
footnotes) as to fairness of presentation, GAAP and consistency by the
chief financial officer or the chief accounting officer of the Borrower;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate, substantially in
the form of Exhibit I (a "Compliance Certificate"), of the chief financial
officer or the chief accounting officer of the Borrower (i) setting forth
in reasonable detail the calculations required to establish whether the
Borrower was in compliance with the requirements of Sections 5.03 through
5.05, inclusive, on the date of such financial statements and (ii) stating
whether any Default exists on the date of such certificate and, if any
Default then exists, setting forth the details thereof and the action which
the Borrower is taking or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of annual financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements to the
effect that nothing has come to their attention to cause them to believe
that any Default related to accounting matters existed on the date of such
financial statements;
(e) within 5 Domestic Business Days after the Borrower becomes aware of
the occurrence of any Default, a certificate of the chief financial officer
or the chief accounting officer of the Borrower setting forth the details
thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements
on Form S-8 or its equivalent) and annual, quarterly or monthly reports
which the Borrower shall have filed with the Securities and Exchange
Commission;
(h) promptly after the Borrower or any member of the Controlled Group
(i) gives or is required to give notice to the PBGC of any "reportable
event" (as defined in Section 4043 of ERISA) with respect to any Plan which
could reasonably be expected to constitute grounds for a termination of
such Plan under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such reportable
event, a copy of the notice of such reportable event given or required to
be given to the PBGC; (ii) receives notice of complete or partial
45
withdrawal liability under Title IV of ERISA, a copy of such notice; or
(iii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate or appoint a trustee to administer any Plan, a copy of such
notice;
(i) promptly after the Borrower knows of the commencement thereof,
notice of any litigation, dispute or proceeding involving a claim against
the Borrower and/or any Subsidiary for $2,000,000 or more in excess of
amounts covered in full by applicable insurance; and
(j) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Inspection of Property, Books and Records. The Borrower
will (i) keep proper books of record and account in which full, true and
correct entries in conformity with GAAP shall be made of all dealings and
transactions in relation to the business and activities of the Borrower and
its Consolidated Subsidiaries; and (ii) permit, and will cause each
Subsidiary to permit, representatives of any Bank at such Bank's expense
prior to the occurrence of an Event of Default and at the Borrower's
expense after the occurrence of an Event of Default to visit and inspect
any of their respective properties, to examine and make abstracts from any
of their respective books and records and to discuss their respective
affairs, finances and accounts with their respective officers, employees
and independent public accountants; provided, any Bank which meets with any
officer, employee or independent public accountant in order to discuss the
affairs, finances or accounts of the Borrower or any Subsidiary shall give
a Responsible Officer notice of and an opportunity to attend such meeting.
The Borrower agrees to cooperate and assist in such visits and inspections,
in each case at such reasonable times and as often as may reasonably be
desired.
SECTION 5.03. Ratio of Consolidated Funded Debt to Consolidated Total
Capital. The ratio of Consolidated Funded Debt to Consolidated Total
Capital shall not at any time exceed .55 to 1.00.
SECTION 5.04. Minimum Consolidated Net Worth. Consolidated Net Worth
will at no time be less than the greater of (x) $175,000,000, or (y) 85% of
Consolidated Net Worth as of September 30, 1996, minus the aggregate amount
of Capital Stock repurchased by the Borrower or any Consolidated Subsidiary
after the Closing Date, plus the sum of (i) 50% of the cumulative Reported
Net Income of the Borrower and its Consolidated Subsidiaries during any
period after September 30, 1996 (taken as one accounting period),
calculated quarterly but excluding from such calculations of Reported Net
Income for purposes of this clause (i) any quarter in which the Reported
Net Income of the Borrower and its Consolidated Subsidiaries is negative,
and (ii) 50% of the cumulative Net Proceeds of Capital Stock received
46
during any period after September 30, 1996, calculated quarterly.
SECTION 5.05. Ratio of Earnings Before Interest, Leases and Taxes to
Consolidated Fixed Charges. At the end of each Fiscal Quarter, commencing
with the Fiscal Quarter ending December 31, 1996, the ratio of Earnings
Before Interest, Leases and Taxes for the Fiscal Quarter then ending and
the three Fiscal Quarters immediately preceding the Fiscal Quarter then
ending to Consolidated Fixed Charges for the Fiscal Quarter then ending and
the three Fiscal Quarters immediately preceding the Fiscal Quarter then
ending shall be greater than 3.00 to 1.00.
SECTION 5.06. Loans or Advances. Neither the Borrower nor any of its
Subsidiaries shall make loans or advances to any Person except: (i) loans
or advances to employees not exceeding One Million Dollars ($1,000,000) in
the aggregate outstanding made in the ordinary course of business and
consistent with practices existing on the Closing Date; (ii) deposits
required by government agencies or public utilities; (iii) loans or
advances to Subsidiaries which are not Guarantors not exceeding Five
Million Dollars ($5,000,000) in the aggregate outstanding, (iv) loans or
advances to Subsidiaries which are Guarantors or from such Guarantors to
the Borrower, (v) loans or advances by any Subsidiary to the Borrower, (vi)
advances in the nature of deposits, progress payments and the like to
suppliers and service providers for property and services in the ordinary
course of business, and (vii) other loans or advances constituting
Permitted Investments; provided that after giving effect to the making of
any loans, advances or deposits permitted by clause (i), (ii), (iii), (iv),
(v), (vi) or (vii) of this Section, no Default shall have occurred and be
continuing.
SECTION 5.07. Investments. Neither the Borrower nor any of its
Subsidiaries shall make Investments in any Person except (a) as permitted
by Section 5.06, (b) for Permitted Investments and Hedging Transactions,
(c) that the Borrower and any Subsidiary shall be permitted to acquire
(whether through the organization of a Subsidiary or otherwise) all or any
portion of the capital stock or securities of any Person engaged in the
business or businesses substantially similar to any business currently
conducted by the Borrower or any Subsidiary or make capital contributions
to any Wholly-Owned Subsidiary which is not a Guarantor, but only to the
extent that (i) the cost of any such acquisition or the amount of any such
capital contribution, when aggregated with the total cost of all such
acquisitions occurring after the Closing Date and the total amount of all
such capital contributions made after the Closing Date, does not exceed the
Test Amount on the day such acquisition occurs or such capital contribution
is made, and (ii) after giving effect to such acquisition or capital
contribution no Default shall exist, and (d) Investments in Guarantors.
SECTION 5.08. Factor Receivables. Neither the Borrower nor any
Subsidiary shall at any time sell or otherwise factor any of its trade
47
receivables other than Factor Receivables (including without limitation
intercompany transfers or sales of Foreign Trade Receivables in
anticipation of their becoming Factor Receivables).
SECTION 5.09. Negative Pledge. Neither the Borrower nor any Significant
Subsidiary will create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it (other than Liens created by the Loan
Documents), except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal amount
not exceeding $565,496;
(b) any Lien existing on any asset of any corporation or other entity at
the time such corporation or other entity becomes a Consolidated Subsidiary
and not created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed for the
purpose of financing all or any part of the cost of acquiring or
constructing such asset, provided that such Lien attaches to such asset
concurrently with or within 18 months after the acquisition or completion
of construction thereof;
(d) any Lien on any asset of any corporation or other entity existing at
the time such corporation or other entity is merged or consolidated with or
into the Borrower or a Consolidated Subsidiary and not created in
contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition thereof by
the Borrower or a Consolidated Subsidiary and not created in contemplation
of such acquisition;
(f) Liens securing Debt owing by any Subsidiary to the Borrower;
(g) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the foregoing
clauses of this Section, provided that (other than as to clause (f) of this
Section) (i) such Debt is not secured by any additional assets, and (ii)
the amount of such Debt secured by any such Lien is not increased;
(h) Liens for taxes not yet due or Liens for taxes being contested in
good faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and as to which
the property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof);
(i) Liens in respect of property imposed by law arising in the ordinary
course of business such as materialmen's, mechanics', warehousemen's and
48
other like Liens provided that such Liens secure only amounts not yet due
and payable or, if due and payable, are being contested in good faith by
appropriate proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which the property
subject to any such Lien is not yet subject to foreclosure, sale or loss on
account thereof);
(j) pledges or deposits made to secure payment of obligations in
connection with workers compensation insurance, unemployment insurance,
pensions or social security programs;
(k) Liens arising from good faith deposits in connection with or to
secure performance of tenders, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations
incurred in the ordinary course of business (other than obligations in
respect of the payment of borrowed money);
(l) Liens arising from good faith deposits in connection with or to
secure performance of statutory obligations and surety and appeal bonds;
(m) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other similar
charges or encumbrances with respect to any property not, in any material
respect, impairing the use of such property for its intended purposes;
(n) Liens with respect to property in Mexico securing Mexican customs
claims, but only to the extent such claims are not yet due and payable and
are not expected to become due and payable;
(o) any Lien on Margin Stock;
(p) Liens not otherwise permitted by the foregoing clauses of this
Section securing Debt (other than indebtedness represented by the Notes) in
an aggregate principal amount at any time outstanding not to exceed 10% of
Consolidated Tangible Net Worth; and
(q) interests of lessors under operating leases and precautionary
Uniform Commercial Code filings in respect thereof.
Provided, Liens permitted by the foregoing clauses (b), (c), (d), (e), (g)
(to the extent such Lien permitted by clause (g) arises out of a
refinancing, extension, renewal or refunding of any Debt secured by a Lien
permitted by clause (b), (c), (d) or (e) of this Section), (i), (j), (k),
(l), (n), (o) and (p) shall at no time secure Debt in an aggregate amount
greater than 20% of Consolidated Tangible Net Worth.
SECTION 5.10. Maintenance of Existence. The Borrower shall, and shall
cause each Significant Subsidiary to, maintain its corporate existence
49
(except as otherwise permitted under Section 5.12) and the Borrower and its
Significant Subsidiaries, taken as a whole, shall carry on their aggregate
business in substantially the same manner and in substantially the same
fields as such business is now carried on and maintained (such fields
generally encompassing the passive electronics component industry).
SECTION 5.11. Dissolution. Neither the Borrower nor any of its
Significant Subsidiaries shall suffer or permit dissolution or liquidation
either in whole or in part, except through corporate reorganization to the
extent permitted by Section 5.12.
SECTION 5.12. Consolidations, Mergers and Sales of Assets. The Borrower
will not, nor will it permit any Subsidiary to, consolidate or merge with
or into, or sell, lease or otherwise transfer all or any substantial part
of its assets to, any other Person, or discontinue or eliminate any
business line or segment, provided that (a) the Borrower or its
Subsidiaries may merge with another Person if (i) the Borrower or such
Subsidiary, as the case may be, is the corporation surviving such merger
and (ii) immediately after giving effect to such merger, no Default shall
have occurred and be continuing, (b) Subsidiaries of the Borrower may merge
with one another, and (c) the foregoing limitation on the sale, lease or
other transfer of assets and on the discontinuation or elimination of a
business line or segment shall not prohibit, (i) during any Fiscal Quarter,
a transfer of assets or the discontinuance or elimination of a business
line or segment (in a single transaction or in a series of related
transactions) unless the aggregate assets to be so transferred or utilized
in a business line or segment to be so discontinued, when combined with all
other assets transferred, and all other assets utilized in all other
business lines or segments discontinued, during such Fiscal Quarter and the
immediately preceding 3 Fiscal Quarters, either (A) constituted more than
10% of Consolidated Total Assets at the end of the fourth Fiscal Quarter
immediately preceding such Fiscal Quarter, or (B) contributed more than 10%
of Consolidated Operating Profits during the 4 consecutive Fiscal Quarters
immediately preceding such Fiscal Quarter; (ii) any transfer of trade names
and trademarks to KRC and the license by KRC of such trade names and
trademarks to the Borrower and its Subsidiaries or in the ordinary course
of business to other Persons; (iii) the sale of Inventory in the ordinary
course of business (including without limitation transfers of raw materials
and work-in-process Inventory to KEMET de Mexico, S.A. de C.V., for
purposes of completing production of such Inventory); (iv) the sale or
disposition of machinery and equipment by the Borrower or any Subsidiary no
longer useful for the conduct of the Borrower's or such Subsidiary's
business; (v) the transfer of assets among the Borrower and the Guarantors
(including equity contributions in Guarantors); (vi) the sale of the Factor
Receivables (including without limitation intercompany transfers of Foreign
Trade Receivables in anticipation of their becoming Factor Receivables) and
payments to purchasers of Factor Receivables (and, intercompany transfers
in anticipation of such payments) of amounts representing collections of
50
Factor Receivables; (vii) the sale of assets from time to time by the
Pledgor to Greenville County, South Carolina and/or Greenwood County, South
Carolina pursuant to the Bond Issuance and Purchase Agreement; (viii)
transfers of assets (including in the case of transfers to Subsidiaries
which are Guarantors, equity contributions) from any Subsidiary which is
not a Guarantor to the Borrower or to any Subsidiary which is a Guarantor;
(ix) transfers permitted under Section 5.06 or 5.07; and (x) transfers of
assets (including equity contributions) to any Subsidiary which is not a
Guarantor in exchange for cash in an amount at least equal to the fair
market value of the assets so transferred (but only to the extent such cash
is paid at or prior to the time of such transfer).
SECTION 5.13. Compliance with Regulations G, T, U and X. The proceeds
of the Loans may be used to refinance existing debt, for the purchase of
the Borrower's common stock by the Borrower, and for general corporate
purposes. No portion of the proceeds of the Loans will be used by the
Borrower or any Subsidiary in violation of (or in a manner so as to cause
the Agent or the Banks to be in violation of) any applicable law or
regulation, including without limitation Regulations G, T, U and X. At no
time will the value of Margin Stock purchased or held by the Borrower
(including, without limitation, shares of common stock of the Borrower
repurchased by and held by the Borrower but excluding shares of common
stock of the Borrower repurchased by and immediately retired by the
Borrower) exceed 25% of Unencumbered Total Assets of the Borrower.
SECTION 5.14. Compliance with Laws; Payment of Taxes. The Borrower
will, and will cause each of its Subsidiaries and each member of the
Controlled Group to, comply with applicable laws (including but not limited
to ERISA), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except such noncompliance as could not
reasonably be expected to have or cause a Material Adverse Effect or where
the necessity of such compliance is being contested in good faith through
appropriate proceedings diligently pursued. The Borrower will, and will
cause each of its Subsidiaries to, pay promptly when due all taxes,
assessments, governmental charges, claims for labor, supplies, rent and
other obligations which, if unpaid, might become a lien against the
property of the Borrower or any Subsidiary, except liabilities being
contested in good faith by appropriate proceedings diligently pursued and
against which the Borrower shall have set up reserves as required by GAAP
or liabilities the nonpayment of which could not reasonably be expected to
have or cause a Material Adverse Effect.
SECTION 5.15. Insurance. The Borrower will maintain, and will cause
each of its Subsidiaries to maintain (either in the name of the Borrower or
in such Subsidiary's own name), with financially sound and reputable
insurance companies, casualty insurance on all its Property and commercial
general liability insurance, in each case in such amounts and against such
risks as are substantially in accordance with the Borrower's practices as
51
of the Closing Date.
SECTION 5.16. Change in Fiscal Year. The Borrower will not change its
Fiscal Year without the consent of the Required Banks.
SECTION 5.17. Maintenance of Property. The Borrower shall, and shall
cause each Subsidiary to, maintain all of its properties and assets in good
condition, repair and working order, ordinary wear and tear excepted,
satisfactory for the conduct of its operations.
SECTION 5.18. Environmental Notices. The Borrower shall furnish to the
Banks and the Agent prompt written notice of any Environmental Liabilities,
pending or (to its knowledge) threatened Environmental Proceedings,
Environmental Notices, Environmental Judgments and Orders, and
Environmental Releases at, on, in, under or in any way affecting the
Properties or any adjacent property if such Environmental Liabilities,
Environmental Proceedings, Environmental Notices, Environmental Judgments
and Orders and/or Environmental Releases could reasonably be expected to
have or cause, alone or in the aggregate, a Material Adverse Effect.
SECTION 5.19. Environmental Matters. The Borrower and its Subsidiaries
will not, and will not permit any Third Party to, use, produce,
manufacture, process, treat, recycle, generate, store, dispose of, manage
at, or otherwise handle or ship or transport to or from the Properties any
Hazardous Materials except for Hazardous Materials used in the
manufacturing process and other Hazardous Materials used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed,
managed or otherwise handled in the ordinary course of business in
compliance with all applicable Environmental Requirements (except for such
noncompliance which could not reasonably be expected to have or cause a
Material Adverse Effect).
SECTION 5.20. Environmental Release. The Borrower agrees that upon the
occurrence of an Environmental Release at or on any of the Properties it
will act promptly to reasonably investigate the extent of, and to take any
remedial action required pursuant to any Environmental Requirement to
eliminate, such Environmental Release, whether or not ordered or otherwise
directed to do so by any Environmental Authority.
SECTION 5.21. Significant Subsidiaries. (a) The Borrower shall cause
any Person which becomes a Domestic Significant Subsidiary after the
Closing Date to become a party to, and agree to be bound by the terms of,
the Guaranty Agreement pursuant to an instrument in form and substance
satisfactory to the Agent executed and delivered to the Agent within 45
days after the last day of the Fiscal Quarter in which such Person became a
Domestic Significant Subsidiary. The Borrower shall also cause the items
specified in Section 3.01(c) and (f) to be delivered to the Agent
concurrently with the instrument referred to above, modified appropriately
52
to refer to such instrument and such Domestic Significant Subsidiary.
(b) The Borrower shall, or shall cause any Subsidiary (the "Pledgor
Subsidiary") to, pledge 65% of the shares of capital stock owned by the
Borrower or such Pledgor Subsidiary in any Person which becomes a Foreign
Significant Subsidiary after the Closing Date pursuant to a pledge
agreement in form and substance substantially identical to the Pledge
Agreement executed and delivered by the Borrower or such Pledgor Subsidiary
to the Agent within 45 days after the last day of the Fiscal Quarter in
which such Person became a Foreign Significant Subsidiary and shall deliver
to the Agent such shares of capital stock together with stock powers
executed in blank. The Borrower shall also cause the items specified in
Section 3.01(c) and (f) to be delivered to the Agent concurrently with the
pledge agreement referred to above, modified appropriately to refer to such
pledge agreement and such Foreign Significant Subsidiary.
(c) Once any Subsidiary becomes a Significant Subsidiary and therefore
becomes a party to the Guaranty Agreement in accordance with Section
5.21(a) or any shares of capital stock of such Subsidiary are pledged to
the Agent in accordance with Section 5.21(b), such Subsidiary thereafter
shall remain a party to the Guaranty Agreement or the shares of capital
stock in such Subsidiary shall remain subject to the pledge to the Agent,
as the case may be, without regard to the amount of its Total Assets on any
day or Operating Profits or gross revenues for any period.
(d) Notwithstanding anything to the contrary contained in this Agreement
or in the Guaranty Agreement, in the event that the Borrower or any
Significant Subsidiary sells or otherwise transfers all of the shares of
capital stock in any Guarantor which is no longer a Significant Subsidiary
in a transaction which does not result in the occurrence of a Default, the
Banks hereby agree that the Agent may, and upon the written request of the
Borrower the Agent shall, release such Guarantor from the Guaranty
Agreement.
SECTION 5.22 Sale, Transfer or Pledge of Industrial Revenue Bonds. The
Borrower shall not, nor shall it permit the Pledgor or any other Guarantor
to, sell, assign, transfer, pledge or otherwise encumber any right, title
or interest in or to the industrial revenue bonds issued and at any time
outstanding under the Bond Issuance and Purchase Agreement, other than any
transfer of such industrial revenue bonds to the Borrower or any Guarantor.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
53
(a) the Borrower shall fail to pay when due any principal of any Loan or
shall fail to pay any interest on any Loan within two Domestic Business
Days after such interest shall become due, or shall fail to pay any fee or
other amount payable hereunder or under the other Loan Documents within
five Domestic Business Days after such fee or other amount becomes due; or
(b) the Borrower shall fail to observe or perform any covenant contained
in Sections 5.03 to 5.13, inclusive, Section 5.16 or Section 5.22 of this
Agreement;
(c) the Borrower shall fail to observe or perform any covenant contained
in Section 5.02(ii) or Section 5.21 for 10 days after the earlier of (i)
the first day on which the Borrower has knowledge of such failure or (ii)
written notice thereof has been given to the Borrower by the Agent at the
request of any Bank; or
(d) the Borrower shall fail to observe or perform any covenant or
agreement contained or incorporated by reference in this Agreement or any
covenant or agreement contained or incorporated by reference in any other
Loan Documents to which the Borrower is a party (other than those covered
by clause (a), (b) or (c) above or by (e) below) for 30 days after the
earlier of (i) the first day on which the Borrower has knowledge of such
failure or (ii) written notice thereof has been given to the Borrower by
the Agent at the request of any Bank; or
(e) the Pledgor, the Borrower or any Pledgor Subsidiary shall fail to
observe or perform any covenant contained in the Pledge Agreement or any
pledge agreement executed by the Borrower or any Pledgor Subsidiary, for 10
days after the earlier of (i) the first day on which the Pledgor, the
Borrower or any Pledgor Subsidiary has knowledge of such failure and (ii)
written notice thereof has been given to the Pledgor, the Borrower or any
Pledgor Subsidiary by the Agent at the request of any Bank; or
(f) any representation, warranty, certification or statement made or
deemed made by the Borrower in Article IV of this Agreement or by any
Guarantor in the Guaranty Agreement or by the Pledgor in the Pledge
Agreement or by the Borrower or any Pledgor Subsidiary in any pledge
agreement executed by the Borrower or such Pledgor Subsidiary pursuant to
Section 5.21(b) hereof or in any certificate, financial statement or other
document delivered pursuant to this Agreement or the Guaranty Agreement or
the Pledge Agreement or in any pledge agreement executed by the Borrower or
by any Pledgor Subsidiary shall prove to have been incorrect or misleading
in any material respect when made (or deemed made); or
(g) the Borrower or any Subsidiary shall fail to make any payment in
excess of $20,000 in respect of Debt outstanding (other than the Notes) in
the aggregate amount in excess of $5,000,000 when due or within any
54
applicable grace period; or
(h) any event or condition shall occur which results in the acceleration
of the maturity of Debt outstanding of the Borrower or any Subsidiary in
the aggregate amount in excess of $5,000,000 or the mandatory prepayment
or purchase of such Debt by the Borrower (or its designee) or such
Subsidiary (or its designee) prior to the scheduled maturity thereof, or
enables the holders of such Debt or any Person acting on such holders'
behalf to accelerate the maturity thereof or require the mandatory
prepayment or purchase thereof prior to the scheduled maturity thereof,
without regard to whether such holders or other Person shall have exercised
or waived their right to do so; or
(i) the Borrower or any Subsidiary shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, or shall consent to any such relief
or to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against it, or shall make a
general assignment for the benefit of creditors, or shall fail generally,
or shall admit in writing its inability, to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing;
or
(j) an involuntary case or other proceeding shall be commenced against
the Borrower or any Subsidiary seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of
a trustee, receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days;
or an order for relief shall be entered against the Borrower or any
Subsidiary under the federal bankruptcy laws as now or hereafter in effect;
or
(k) the Borrower or any member of the Controlled Group shall fail to pay
when due any material amount which it shall have become liable to pay to
the PBGC or to a Plan under Title IV of ERISA; or notice of intent to
terminate a Plan or Plans shall be filed under Title IV of ERISA by the
Borrower, any member of the Controlled Group, any plan administrator or any
combination of the foregoing, provided that such termination could
reasonably be expected to have or cause a Material Adverse Effect; or the
PBGC shall institute proceedings under Title IV of ERISA to terminate or to
cause a trustee to be appointed to administer any such Plan or Plans or a
proceeding shall be instituted by a fiduciary of any such Plan or Plans to
enforce Section 515 or 4219(c)(5) of ERISA and such proceeding shall not
55
have been dismissed within 30 days thereafter; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any such Plan or Plans must be terminated; or at any time
the aggregate complete or partial withdrawal liability under Title IV of
ERISA with respect to Multiemployer Plans incurred by the Borrower and
members of the Controlled Group shall exceed $5,000,000 (for purposes of
this clause, the amount of withdrawal liability of the Borrower and members
of the Controlled Group at any date shall be the aggregate present value of
the amount, determined in accordance with Section 4201(b)(1) of ERISA,
claimed to have been incurred by the Borrower and members of the Controlled
Group in any notices received by any of them as of such date from any
Multiemployer Plan sponsor, less any portion thereof which the Borrower and
members of the Controlled Group have paid or as to which the Borrower
reasonably believes after appropriate consideration of possible adjustments
arising under Sections 4219 and 4221 of ERISA, it and members of the
Controlled Group will have no liability, provided that the Borrower shall
obtain prompt written advice from independent actuarial consultants
supporting such determination); or
(l) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $5,000,000 shall be rendered against the
Borrower or any Subsidiary and such judgment or order shall continue
unsatisfied and unstayed for a period of 30 days; or
(m) a federal tax lien shall be filed against the Borrower under
Section 6323 of the Code or a lien of the PBGC shall be filed against the
Borrower or any Subsidiary under Section 4068 of ERISA and in either case
such lien shall remain undischarged for a period of 25 days after the date
of filing; or
(n) a Change of Control shall occur; or
(o) an "Event of Default" shall occur under Section 10.1(a) of the Lease
Agreement (but only to the extent such Event of Default results from a
failure to make any Payment-in-Lieu-of-Taxes (as defined in the Lease
Agreement)); or
(p) the Guaranty Agreement, the Pledge Agreement or any pledge agreement
executed by the Borrower or any Pledgor Subsidiary pursuant to Section
5.21(b) hereof shall cease to be in full force and effect; or
(q) any Guarantor or any Person acting on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations under the Guaranty
Agreement;
then, and in every such event, the Agent shall (i) if requested by the
Required Banks, by notice to the Borrower terminate the Commitments and
they shall thereupon terminate, and (ii) if requested by the Required
56
Banks, by notice to the Borrower declare the Notes (together with accrued
interest thereon) and all other amounts payable hereunder and under the
other Loan Documents to be, and the Notes (together will all accrued
interest thereon) and all other amounts payable hereunder and under the
other Loan Documents shall thereupon become, immediately due and payable
without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower; provided that if any Event of
Default specified in clause (i) or (j) above occurs with respect to the
Borrower, without any notice to the Borrower or any other act by the Agent
or the Banks, the Commitments shall thereupon automatically terminate and
the Notes (together with accrued interest thereon) and all other amounts
payable hereunder and under the other Loan Documents shall automatically
become immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.
Notwithstanding the foregoing, the Agent shall have available to it all
other remedies at law or equity, and shall exercise any one or all of them
at the request of the Required Banks.
SECTION 6.02. Notice of Default. The Agent shall give notice to the
Borrower of any Default under Section 6.01(c) promptly upon being requested
to do so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities. Each Bank hereby
irrevocably appoints and authorizes the Agent to act as its agent hereunder
and under the other Loan Documents with such powers as are specifically
delegated to the Agent by the terms hereof and thereof, together with such
other powers as are reasonably incidental thereto. The Agent: (a) shall
have no duties or responsibilities except as expressly set forth in this
Agreement and the other Loan Documents, and shall not by reason of this
Agreement or any other Loan Document be a trustee for any Bank; (b) shall
not be responsible to the Banks for any recitals, statements,
representations or warranties contained in this Agreement or any other Loan
Document, or in any certificate or other document referred to or provided
for in, or received by any Bank under, this Agreement or any other Loan
Document, or for the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or any other
document referred to or provided for herein or therein or for any failure
by the Borrower to perform any of its obligations hereunder or thereunder;
(c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document except to
the extent requested by the Required Banks, and then only on terms and
conditions satisfactory to the Agent, and (d) shall not be responsible for
any action taken or omitted to be taken by it hereunder or under any other
Loan Document or any other document or instrument referred to or provided
57
for herein or therein or in connection herewith or therewith, except for
its own gross negligence or willful misconduct. The Agent may employ
agents and attorneys-in-fact and shall not be responsible for the
negligence or misconduct of any such agents or attorneys-in-fact selected
by it with reasonable care. The provisions of this Article VII are solely
for the benefit of the Agent and the Banks, and the Borrower shall not have
any rights as a third party beneficiary of any of the provisions hereof.
In performing its functions and duties under this Agreement and under the
other Loan Documents, the Agent shall act solely as agent of the Banks and
does not assume and shall not be deemed to have assumed any obligation
towards or relationship of agency or trust with or for the Borrower. The
duties of the Agent shall be ministerial and administrative in nature, and
the Agent shall not have by reason of this Agreement or any other Loan
Document a fiduciary relationship in respect of any Bank. References
herein to the "Agent" shall not include the Co-Agent, and the
Co-Agent shall have no rights, duties or obligations as "Agent" hereunder.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled to rely
upon any certification, notice or other communication (including any
thereof by telephone, telefax, telegram or cable) believed by it to be
genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants or other experts selected by the Agent. As to any
matters not expressly provided for by this Agreement or any other Loan
Document, the Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and thereunder in accordance with
instructions signed by the Required Banks, and such instructions of the
Required Banks in any action taken or failure to act pursuant thereto shall
be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have knowledge
of the occurrence of a Default or an Event of Default (other than the
non-payment of principal of or interest on the Loans) unless the Agent has
received notice from a Bank or the Borrower specifying such Default or
Event of Default and stating that such notice is a "Notice of Default". In
the event that the Agent receives such a notice of the occurrence of a
Default or an Event of Default, the Agent shall give prompt notice thereof
to the Banks. The Agent shall give each Bank prompt notice of each
non-payment of principal of or interest on the Loans, whether or not it has
received any notice of the occurrence of such non-payment. The Agent shall
(subject to Section 9.05) take such action with respect to such Default or
Event of Default as shall be directed by the Required Banks, provided that,
unless and until the Agent shall have received such directions, the Agent
may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Banks.
SECTION 7.04. Rights of Agent and its Affiliates as a Bank. With
58
respect to any Loans made by an Affiliate of Wachovia, such Affiliate (and
Wachovia if it becomes a Bank hereunder) in its capacity as a Bank
hereunder shall have the same rights and powers hereunder as any other Bank
and may exercise the same as though it were not an Affiliate of the Agent
(or in Wachovia's case, acting as Agent), and the term "Bank" or "Banks"
shall, unless the context otherwise indicates, include such Affiliate of
Wachovia (or Wachovia, if it becomes a Bank hereunder) in its individual
capacity. Such Affiliate and the Agent may (without having to account
therefor to any Bank) accept deposits from, lend money to and generally
engage in any kind of banking, trust or other business with the Borrower
(and any of its Affiliates) as if they were not an Affiliate of the Agent
or acting as the Agent, respectively, and such Affiliate and the Agent may
accept fees and other consideration from the Borrower (in addition to any
agency fees and arrangement fees heretofore agreed to between the Borrower
and the Agent) for services in connection with this Agreement or any other
Loan Document or otherwise without having to account for the same to the
Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to indemnify
the Agent, to the extent the Agent shall not have been reimbursed by the
Borrower, ratably in accordance with its Commitment, for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including, without limitation, counsel fees and
disbursements) or disbursements of any kind and nature whatsoever which may
be imposed on, incurred by or asserted against the Agent in any way
relating to or arising out of this Agreement or any other Loan Document or
any other documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby (excluding, unless an Event of
Default has occurred and is continuing, the normal administrative costs and
expenses incident to the performance of its agency duties hereunder) or the
enforcement of any of the terms hereof or thereof or any such other
documents; provided, however, that no Bank shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the Agent. If any indemnity furnished to the Agent for any
purpose shall, in the opinion of the Agent, be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional
indemnity is furnished.
SECTION 7.06. CONSEQUENTIAL DAMAGES. THE AGENT SHALL NOT BE RESPONSIBLE
OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER PERSON OR ENTITY FOR ANY
PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
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SECTION 7.07. Payee of Note Treated as Owner. The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes hereof
unless and until a written notice of the assignment or transfer thereof
shall have been filed with the Agent and the provisions of Section 9.07(c)
have been satisfied. Any requests, authority or consent of any Person who
at the time of making such request or giving such authority or consent is
the holder of any Note shall be conclusive and binding on any subsequent
holder, transferee or assignee of that Note or of any Note or Notes issued
in exchange therefor or replacement thereof.
SECTION 7.08. Non-Reliance on Agent and Other Banks. Each Bank agrees
that it has, independently and without reliance on the Agent or any other
Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and decision to
enter into this Agreement and that it will, independently and without
reliance upon the Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own analysis and decisions in taking or not taking action under this
Agreement or any of the other Loan Documents. The Agent shall not be
required to keep itself (or any Bank) informed as to the performance or
observance by the Borrower of this Agreement or any of the other Loan
Documents or any other document referred to or provided for herein or
therein or to inspect the properties or books of the Borrower or any other
Person. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder or
under the other Loan Documents, the Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of the Borrower or
any other Person (or any of their Affiliates) which may come into the
possession of the Agent.
SECTION 7.09. Failure to Act. Except for action expressly required of
the Agent hereunder or under the other Loan Documents, the Agent shall in
all cases be fully justified in failing or refusing to act hereunder and
thereunder unless it shall receive further assurances to its satisfaction
by the Banks of their indemnification obligations under Section 7.05
against any and all liability and expense which may be incurred by the
Agent by reason of taking, continuing to take, or failing to take any such
action.
SECTION 7.10. Resignation or Removal of Agent. (a) Subject to the
appointment and acceptance of a successor Agent as provided below, the
Agent may resign at any time by giving notice thereof to the Banks and the
Borrower and the Agent may be removed at any time with or without cause by
the Required Banks. Upon any such resignation or removal, the Required
Banks shall have the right to appoint a successor Agent reasonably
60
acceptable to the Borrower. If no successor Agent shall have been so
appointed by the Required Banks and shall have accepted such appointment
within 30 days after the retiring Agent's notice of resignation or the
Required Banks' removal of the retiring Agent, then the retiring Agent may,
on behalf of the Banks, appoint a successor Agent reasonably acceptable to
the Borrower. Any successor Agent shall be a bank which has a combined
capital and surplus of at least $500,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall
be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions
of this Article VII shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was acting as the
Agent hereunder.
(b) If at any time the aggregate amount of the Commitments of the Agent,
in its capacity as a Bank, and any Affiliate of the Agent shall be less
than $10,000,000, the Agent shall promptly resign as Agent hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair.
If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars (in the applicable
amounts) are not being offered in the relevant market for such Interest
Period, or
(b) the Required Banks advise the Agent that the London Interbank
Offered Rate, as the case may be, as determined by the Agent will not
adequately and fairly reflect the cost to such Banks of funding
Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make Euro-Dollar Loans shall be suspended.
Unless the Borrower notifies the Agent at least 1 Domestic Business Day
before the date of any Borrowing of Euro-Dollar Loans for which a Notice of
Borrowing has previously been given that it elects not to borrow on such
date, such Borrowing shall instead be made as a Base Rate Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the adoption of
any applicable law, rule or regulation, or any change in any existing or
future law, rule or regulation, or any change in the interpretation or
61
administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof
(any such authority, bank or agency being referred to as an "Authority" and
any such event being referred to as a "Change of Law"), or compliance by
any Bank (or its Lending Office) with any request or directive (whether or
not having the force of law) of any Authority shall make it unlawful or
impossible for any Bank (or its Lending Office) to make, maintain or fund
its Euro-Dollar Loans and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended.
Before giving any notice to the Agent pursuant to this Section, such Bank
shall designate a different Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Bank,
be otherwise disadvantageous to such Bank. If such Bank shall determine
that it may not lawfully continue to maintain and fund any of its
outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each Euro-Dollar Loan of such Bank, together with
accrued interest thereon and any amount due such Bank pursuant to Section
8.05(a). Concurrently with prepaying each such Euro-Dollar Loan, the
Borrower shall borrow a Base Rate Loan in an equal principal amount from
such Bank (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks),
and such Bank shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after the date
hereof, a Change of Law or compliance by any Bank (or its Lending Office)
with any request or directive (whether or not having the force of law) of
any Authority:
(i) shall subject any Bank (or its Lending Office) to any tax, duty or
other charge with respect to its Euro-Dollar Loans, its Notes or its
obligation to make Euro-Dollar Loans, or shall change the basis of taxation
of payments to any Bank (or its Lending Office) of the principal of or
interest on its Euro-Dollar Loans or any other amounts due under this
Agreement in respect of its Euro-Dollar Loans or its obligation to make
Euro-Dollar Loans (except for changes in the rate of tax on the overall
income of such Bank or its Lending Office imposed by the jurisdiction in
which such Bank's principal executive office or Lending Office is located);
or
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding with respect to any Euro-Dollar Loan any such
requirement included in an applicable Euro-Dollar Reserve Percentage)
62
against assets of, deposits with or for the account of, or credit extended
by, any Bank (or its Lending Office); or
(iii) shall impose on any Bank (or its Lending Office) or on the London
interbank market any other condition affecting its Euro-Dollar Loans, its
Notes or its obligation to make Euro-Dollar Loans;
and the result of any of the foregoing is to increase the cost to such Bank
(or its Lending Office) of making or maintaining any Euro-Dollar Loan, or
to reduce the amount of any sum received or receivable by such Bank (or its
Lending Office) under this Agreement or under its Notes with respect
thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Agent), the Borrower
shall pay to such Bank such additional amount or amounts as will compensate
such Bank for such increased cost or reduction.
(b) If any Bank shall have determined that after the date hereof the
adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any existing or future law, rule or regulation,
or any change in the interpretation or administration thereof, or
compliance by any Bank (or its Lending Office) with any request or
directive regarding capital adequacy (whether or not having the force of
law) of any Authority, has or would have the effect of reducing the rate of
return on such Bank's capital as a consequence of its obligations hereunder
to a level below that which such Bank could have achieved but for such
adoption, change or compliance (taking into consideration such Bank's
policies with respect to capital adequacy) by an amount deemed by such Bank
to be material, then from time to time, within 15 days after demand by such
Bank, the Borrower shall pay to such Bank such additional amount or amounts
as will compensate such Bank for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent of any
event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Lending Office if such designation will avoid the
need for, or reduce the amount of, such compensation and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. Notice
by any Bank hereunder will be deemed to have been delivered promptly if
given within 45 days after such Bank shall have determined it is entitled
to compensation as a result of the occurrence of any such event. The
Borrower shall not be liable for compensation pursuant to this Section for
which prompt notice has not been given. A certificate of any Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any
reasonable averaging and attribution methods.
(d) The provisions of this Section 8.03 shall be applicable with respect
63
to any Participant, Assignee or other Transferee, and any calculations
required by such provisions shall be made based upon the circumstances of
such Participant, Assignee or other Transferee.
(e) In the event that any Bank gives any notice under Section 8.02
resulting in the suspension of its obligation to make Euro-Dollar Loans or
requests compensation pursuant to Section 8.03, then, so long as the
condition giving rise to such suspension or compensation exists, the
Borrower may designate another bank or financial institution (such bank or
financial institution being herein called a "Replacement Bank") reasonably
acceptable to the Agent and which is not an Affiliate of the Borrower, to
assume such Bank's Commitment hereunder and to purchase the Loans of such
Bank and such Bank's rights under this Agreement and the Notes held by such
Bank, all without recourse to or representation or warranty by, or expense
to, such Bank, for a purchase price equal to the outstanding principal
amount of the Loans payable to such Bank plus any accrued but unpaid
interest on such Loans and accrued but unpaid fees owing to such Bank plus
any amounts payable to such Bank under Section 8.05, and upon such
assumption, purchase and substitution, and subject to the execution and
delivery to the Agent by the Replacement Bank of documentation satisfactory
to the Agent (pursuant to which such Replacement Bank shall assume the
obligations of such original Bank under this Agreement), the Replacement
Bank shall succeed to the rights and obligations of such Bank hereunder.
In the event that the Borrower exercises its rights under the preceding
sentence, the Bank against which such rights were exercised shall no longer
be a party hereto or have any rights or obligations hereunder; provided
that the obligations of the Borrower to such Bank under Article VIII and
Section 9.03 with respect to events occurring or obligations arising
before or as a result of such replacement shall survive such exercise.
SECTION 8.04. Base Rate Loans Substituted for Affected
Euro-Dollar Loans. If (i) the obligation of any Bank to make or maintain
Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii) any
Bank has demanded compensation under Section 8.03, and the Borrower shall,
by at least 5 Euro-Dollar Business Days' prior notice to such Bank through
the Agent, have elected that the provisions of this Section shall apply to
such Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:
(a) all Loans which would otherwise be made by such Bank as
Euro-Dollar Loans shall be made as Base Rate Loans (in all cases interest
and principal on such Loans shall be payable contemporaneously with the
related Euro-Dollar Loans of the other Banks), and
(b) after each of its Euro-Dollar Loans has been repaid, all payments of
principal which would otherwise be applied to repay such Euro-Dollar Loans
shall be applied to repay its Base Rate Loans instead.
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In the event that the Borrower shall elect that the provisions of this
Section shall apply to any Bank, the Borrower shall remain liable for, and
shall pay to such Bank as provided herein, all amounts due such Bank under
Section 8.03 in respect of the period preceding the date of conversion of
such Bank's Loans resulting from the Borrower's election.
SECTION 8.05. Compensation. Upon the request of any Bank, delivered to
the Borrower and the Agent, the Borrower shall pay to such Bank such amount
or amounts as shall compensate such Bank for any loss, cost or expense
incurred by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.09, Section 2.10,
Section 2.11, Section 8.02 or otherwise) of a Euro-Dollar Loan or a Money
Market Loan on a date other than the last day of an Interest Period for
such Euro-Dollar Loan or Money Market Loan, as the case may be;
(b) any failure by the Borrower to prepay a Euro-Dollar Loan or a Money
Market Loan on the date for such prepayment specified in the relevant
notice of prepayment hereunder;
(c) any failure by the Borrower to borrow a Euro-Dollar Loan on the date
for the Euro-Dollar Borrowing of which such Euro-Dollar Loan is a part
specified in the applicable Notice of Borrowing delivered pursuant to
Section 2.02; or
(d) any failure by the Borrower to borrow a Money Market Loan (with
respect to which the Borrower has accepted a Money Market Quote) on the
date for the Money Market Borrowing of which such Money Market Loan is a
part specified in the applicable Money Market Quote Request delivered
pursuant to Section 2.03;such compensation to include, without limitation,
in the case of a Euro-Dollar Loan an amount equal to the excess, if any, of
(x) the amount of interest which would have accrued on the amount so paid
or prepaid or not prepaid or borrowed for the period from the date of such
payment, prepayment or failure to prepay or borrow to the last day of the
then current Interest Period for such Euro-Dollar Loan (or, in the case of
a failure to prepay or borrow, the Interest Period for such Euro-Dollar
Loan which would have commenced on the date of such failure to prepay or
borrow) at the applicable rate of interest for such Euro-Dollar Loan
provided for herein over (y) the amount of interest (as reasonably
determined by such Bank) such Bank would have paid on (i) deposits in
Dollars of comparable amounts having terms comparable to such period placed
with it by leading banks in the London interbank market.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given to such party at its
address or telecopy number set forth on the signature pages hereof or such
other address or telecopy number as such party may hereafter specify for
the purpose by notice to each other party. Each such notice, request or
other communication shall be effective (i) if given by telecopier, when
such telecopy is transmitted to the telecopy number specified in this
Section and the telecopy machine used by the sender provides a written
confirmation that such telecopy has been so transmitted or receipt of such
telecopy transmission is otherwise confirmed, (ii) if given by mail,
72 hours after such communication is deposited in the mails with first
class postage prepaid, addressed as aforesaid, and (iii) if given by any
other means, when delivered at the address specified in this Section;
provided that notices to the Agent under Article II or Article VIII shall
not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or any Bank
in exercising any right, power or privilege hereunder or under any Note or
other Loan Document shall operate as a waiver thereof nor shall any single
or partial exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
SECTION 9.03. Expenses; Documentary Taxes; Indemnification. (a) The
Borrower shall pay (i) all out-of-pocket expenses of the Agent, including
fees and disbursements of a single special counsel for the Agent, in
connection with the preparation of this Agreement and the other Loan
Documents, any waiver or consent hereunder or thereunder or any amendment
hereof or thereof or any Default or alleged Default hereunder or thereunder
and (ii) if a Default occurs, all out-of-pocket expenses incurred by the
Agent or any Bank, including fees and disbursements of counsel, in
connection with such Default and collection and other enforcement
proceedings resulting therefrom, including out-of-pocket expenses incurred
in enforcing this Agreement and the other Loan Documents.
(b) The Borrower shall indemnify the Agent and each Bank against any
transfer taxes, documentary taxes, assessments or charges made by any
Authority by reason of the execution and delivery of this Agreement or the
other Loan Documents (other than any such amounts incurred in connection
with the execution and delivery of an Assignment and Acceptance, except to
the extent provided in Section 8.03(e)).
66
(c) The Borrower shall indemnify the Agent, the Banks and each Affiliate
thereof and their respective directors, officers, employees and agents
from, and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become subject,
insofar as such losses, liabilities, claims or damages arise out of or
result from any actual or proposed use by the Borrower of the proceeds of
any extension of credit by any Bank hereunder or breach by the Borrower of
this Agreement or any other Loan Document or from investigation, litigation
(including, without limitation, any actions taken by the Agent or any of
the Banks to enforce this Agreement or any of the other Loan Documents) or
other proceeding (including, without limitation, any threatened
investigation or proceeding) relating to the foregoing, and the Borrower
shall reimburse the Agent and each Bank, and each Affiliate thereof and
their respective directors, officers, employees and agents, upon demand for
any reasonable expenses (including, without limitation, legal fees)
incurred in connection with any such investigation or proceeding; but
excluding any such losses, liabilities, claims, damages or expenses
incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified.
SECTION 9.04. Setoffs; Sharing of Set-Offs. (a) The Borrower hereby
grants to each Bank, as security for the full and punctual payment and
performance of the obligations of the Borrower under this Agreement, a
continuing lien on and security interest in all deposits and other sums
credited by or due from such Bank to the Borrower or subject to withdrawal
by the Borrower; and regardless of the adequacy of any collateral or other
means of obtaining repayment of such obligations, each Bank may at any time
upon or after the occurrence of any Event of Default, and without notice to
the Borrower, set off the whole or any portion or portions of any or all
such deposits and other sums against such obligations, whether or not any
other Person or Persons could also withdraw money therefrom.
(b) Each Bank agrees that if it shall, by exercising any right of
set-off or counterclaim or otherwise, receive payment of a proportion of
the aggregate amount of principal and interest owing with respect to the
Syndicated Notes held by it which is greater than the proportion received
by any other Bank in respect of the aggregate amount of all principal and
interest owing with respect to the Syndicated Notes held by such other
Bank, the Bank receiving such proportionately greater payment shall
purchase such participations in the Syndicated Notes held by the other
Banks owing to such other Banks, and/or such other adjustments shall be
made, as may be required so that all such payments of principal and
interest with respect to the Syndicated Notes held by the Banks owing to
such other Banks shall be shared by the Banks pro rata; provided that (i)
nothing in this Section shall impair the right of any Bank to exercise any
right of set-off or counterclaim it may have and to apply the amount
subject to such exercise to the payment of indebtedness (including, without
limitation, Money Market Loans) of the Borrower other than its indebtedness
67
under the Syndicated Notes, and (ii) if all or any portion of such payment
received by the purchasing Bank is thereafter recovered from such
purchasing Bank, such purchase from each other Bank shall be rescinded and
such other Bank shall repay to the purchasing Bank the purchase price of
such participation to the extent of such recovery together with an amount
equal to such other Bank's ratable share (according to the proportion of
(x) the amount of such other Bank's required repayment to (y) the total
amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total
amount so recovered. The Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation
in a Syndicated Note, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.05. Amendments and Waivers. (a) Any provision of this
Agreement, the Notes or any other Loan Documents may be amended or waived
if, but only if, such amendment or waiver is in writing and is signed by
the Borrower and the Required Banks (and, if the rights or duties of the
Agent are affected thereby, by the Agent); provided that no such amendment
or waiver shall, unless signed by all the Banks, (i) change the Commitment
of any Bank or subject any Bank to any additional obligation (other than as
contemplated by Section 2.05(b)), (ii) change the principal of or rate of
interest on any Loan or any fees hereunder, (iii) change the date fixed for
any payment of principal of or interest on any Loan or any fees hereunder,
(iv) change the amount of principal, interest or fees due on any date fixed
for the payment thereof, (v) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Notes, or the percentage of
Banks, which shall be required for the Banks or any of them to take any
action under this Section or any other provision of this Agreement,
(vi) change the manner of application of any payments made under this
Agreement or the Notes, (vii) release or substitute all or any substantial
part of the collateral (if any) held as security for the Loans, or (viii)
release any guaranty given to support payment of the Loans.
(b) The Borrower will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment of any of the provisions of
this Agreement unless each Bank (either directly or through the Agent)
shall be informed thereof by the Borrower and shall be afforded an
opportunity of considering the same and shall be supplied by the Borrower
with sufficient information to enable it to make an informed decision with
respect thereto. Executed or true and correct copies of any waiver or
consent effected pursuant to the provisions of this Agreement shall be
delivered by the Borrower to the Agent forthwith following the date on
which the same shall have been executed and delivered by the requisite
percentage of Banks. The Borrower will not, directly or indirectly, pay or
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cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, to any Bank (in its capacity as
such) as consideration for or as an inducement to the entering into by such
Bank of any waiver or amendment of any of the terms and provisions of this
Agreement unless such remuneration is concurrently paid, on the same terms,
ratably to all such Banks.
SECTION 9.06. Margin Stock Collateral. Each of the Banks represents to
the Agent and each of the other Banks that it in good faith is not,
directly or indirectly (by negative pledge or otherwise), relying upon any
Margin Stock as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 9.07. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided that the
Borrower may not assign or otherwise transfer any of its rights under this
Agreement.
(b) Any Bank may at any time sell to one or more Persons (each a
"Participant") participating interests in any Loan owing to such Bank, any
Note held by such Bank, any Commitment hereunder or any other interest of
such Bank hereunder. In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement shall remain unchanged, such Bank shall remain solely responsible
for the performance thereof, such Bank shall remain the holder of any such
Note for all purposes under this Agreement, and the Borrower and the Agent
shall continue to deal solely and directly with such Bank in connection
with such Bank's rights and obligations under this Agreement. In no event
shall a Bank that sells a participation be obligated to the Participant to
take or refrain from taking any action hereunder except that such Bank may
agree that it will not (except as provided below), without the consent of
the Participant, agree to (i) the change of any date fixed for the payment
of principal of or interest on the related Loan or Loans, (ii) the change
of the amount of any principal, interest or fees due on any date fixed for
the payment thereof with respect to the related Loan or Loans, (iii) the
change of the principal of the related Loan or Loans, (iv) any change in
the rate at which either interest is payable thereon or (if the Participant
is entitled to any part thereof) facility fee is payable hereunder from the
rate at which the Participant is entitled to receive interest or facility
fee (as the case may be) in respect of such participation, (v) the release
or substitution of all or any substantial part of the collateral (if any)
held as security for the Loans, or (vi) the release of any guaranty given
to support payment of the Loans. The Borrower agrees that each Participant
shall be entitled to the benefits of Article VIII with respect to its
participation in Loans outstanding from time to time.
(c) Any Bank may at any time assign to one or more banks or financial
69
institutions (each an "Assignee") all, or a proportionate part of all, of
its rights and obligations under this Agreement, the Notes and the other
Loan Documents, and such Assignee shall assume all such rights and
obligations, pursuant to an Assignment and Acceptance in the form attached
hereto as Exhibit J, executed by such Assignee, such transferor Bank and
the Agent (and, in the case of an Assignee that is not then a Bank or an
Affiliate of a Bank, by the Borrower); provided that (i) no interest may be
sold by a Bank pursuant to this paragraph (c) unless the Assignee shall
agree to assume ratably equivalent portions of the transferor Bank's
Commitment, (ii) the amount of the Commitment of the assigning Bank subject
to such assignment (determined as of the effective date of the assignment)
shall be equal to $10,000,000 (or any larger multiple of $1,000,000),
(iii) no interest may be sold by a Bank pursuant to this paragraph (c) to
any Assignee that is not then a Bank or an Affiliate of a Bank without the
consent of the Borrower, which consent shall not be unreasonably withheld;
provided that the Borrower's consent shall not be necessary with respect to
any assignment made after the occurrence and during the continuance of a
Default, and (iv) a Bank may not have more than two (2) Assignees that are
not then Banks or Affiliates of such Banks at any one time. Upon
(A) execution of the Assignment and Acceptance by such transferor Bank,
such Assignee, the Agent and (if applicable) the Borrower, (B) delivery of
an executed copy of the Assignment and Acceptance to the Borrower and the
Agent, (C) payment by such Assignee to such transferor Bank of an amount
equal to the purchase price agreed between such transferor Bank and such
Assignee, and (D) payment of a processing and recordation fee of $2,500 to
the Agent, such Assignee shall for all purposes be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank under
this Agreement (including, without limitation, the rights of a Bank under
Section 2.03) to the same extent as if it were an original party hereto
with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by the Borrower, the
Banks or the Agent shall be required. Upon the consummation of any
transfer to an Assignee pursuant to this paragraph (c), the transferor
Bank, the Agent and the Borrower shall make appropriate arrangements so
that, if required, a new Note is issued to each of such Assignee and such
transferor Bank.
(d) Subject to the provisions of Section 9.08, the Borrower authorizes
each Bank to disclose to any Participant, Assignee or other transferee
(each a "Transferee") and any prospective Transferee any and all financial
and other information in such Bank's possession concerning the Borrower
which has been delivered to such Bank by the Borrower pursuant to this
Agreement or which has been delivered to such Bank by the Borrower in
connection with such Bank's credit evaluation prior to entering into this
Agreement.
(e) No Transferee shall be entitled to receive any greater payment under
70
Section 8.03 than the transferor Bank would have been entitled to receive
with respect to the rights transferred, unless such transfer is made with
the Borrower's prior written consent or by reason of the provisions of
Section 8.02 or 8.03 requiring such Bank to designate a different Lending
Office under certain circumstances or at a time when the circumstances
giving rise to such greater payment did not exist.
(f) Anything in this Section 9.07 to the contrary notwithstanding, any
Bank may assign and pledge all or any portion of the Loans and/or
obligations owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and Operating Circular issued by
such Federal Reserve Bank, provided that any payment in respect of such
assigned Loans and/or obligations made by the Borrower to the assigning
and/or pledging Bank in accordance with the terms of this Agreement shall
satisfy the Borrower's obligations hereunder in respect of such assigned
Loans and/or obligations to the extent of such payment. No such assignment
shall release the assigning and/or pledging Bank from its obligations
hereunder.
SECTION 9.08. Confidentiality. Each Bank agrees to exercise its best
efforts to keep any information delivered or made available by the Borrower
to it which is not publicly available, confidential from anyone other than
persons employed or retained by such Bank who are or are expected to become
engaged in evaluating, approving, structuring or administering the Loans;
provided, however, that nothing herein shall prevent any Bank from
disclosing such information (i) to any other Bank, (ii) upon the order of
any court or administrative agency, (iii) upon the request or demand of any
regulatory agency or authority having jurisdiction over such Bank, (iv)
which has been publicly disclosed unless such public disclosure is known by
such Bank to be in violation of this Section 9.08, (v) to the extent
reasonably required in connection with any litigation to which the Agent,
any Bank or their respective Affiliates may be a party (provided, that
prior to such disclosure, such Bank shall notify the Borrower to the extent
reasonably practicable and shall afford the Borrower an opportunity to
contest such disclosure, unless such Bank shall determine that such a
contest would prejudice its rights or interests), (vi) to the extent
reasonably required in connection with the exercise of any remedy
hereunder, (vii) to such Bank's legal counsel and independent auditors and
(viii) upon the prior written consent of the Borrower, to any actual or
proposed Participant, Assignee or other Transferee (other than any Assignee
or Transferee to which an assignment or transfer is being made after the
occurrence and during the continuance of a Default) of all or part of its
rights hereunder which has agreed in writing to be bound by the provisions
of this Section 9.08.
SECTION 9.09. Representation by Banks. Each Bank hereby represents that
it is a commercial lender or financial institution which makes loans in the
71
ordinary course of its business and that it will make its Loans hereunder
for its own account in the ordinary course of such business; provided,
however, that, subject to Section 9.07, the disposition of the Note or
Notes held by that Bank shall at all times be within its exclusive control.
SECTION 9.10. Obligations Several. The obligations of each Bank
hereunder are several, and no Bank shall be responsible for the obligations
or commitment of any other Bank hereunder. Nothing contained in this
Agreement and no action taken by the Banks pursuant hereto shall be deemed
to constitute the Banks to be a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time
hereunder to each Bank shall be a separate and independent debt, and each
Bank shall be entitled to protect and enforce its rights arising out of
this Agreement or any other Loan Document and it shall not be necessary for
any other Bank to be joined as an additional party in any proceeding for
such purpose.
SECTION 9.11. Survival of Certain Obligations. Sections 8.03(a),
8.03(b), 8.05 and 9.03, and the obligations of the Borrower thereunder,
shall survive, and shall continue to be enforceable notwithstanding, the
termination of this Agreement and the Commitments and the payment in full
of the principal of and interest on all Loans.
SECTION 9.12. Georgia Law. This Agreement and each Note shall be
construed in accordance with and governed by the law of the State of
Georgia.
SECTION 9.13. Severability. In case any one or more of the provisions
contained in this Agreement, the Notes or any of the other Loan Documents
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein
and therein shall not in any way be affected or impaired thereby and shall
be enforced to the greatest extent permitted by law.
SECTION 9.14. Interest. In no event shall the amount of interest due or
payable hereunder or under the Notes exceed the maximum rate of interest
allowed by applicable law, and in the event any such payment is
inadvertently made to any Bank by the Borrower or inadvertently received by
any Bank, then such excess sum shall be credited as a payment of principal,
unless the Borrower shall notify such Bank in writing that it elects to
have such excess sum returned forthwith. It is the express intent hereof
that the Borrower not pay and the Banks not receive, directly or indirectly
in any manner whatsoever, interest in excess of that which may legally be
paid by the Borrower under applicable law.
SECTION 9.15. Interpretation. No provision of this Agreement or any of
the other Loan Documents shall be construed against or interpreted to the
disadvantage of any party hereto by any court or other governmental or
72
judicial authority by reason of such party having or being deemed to have
structured or dictated such provision.
SECTION 9.16. Consent to Jurisdiction. The Borrower (a) submits to
personal jurisdiction in the State of Georgia, the courts thereof and the
United States District Courts sitting therein, for the enforcement of this
Agreement, the Notes and the other Loan Documents, (b) waives any and all
personal rights under the law of any jurisdiction to object on any basis
(including, without limitation, inconvenience of forum) to jurisdiction or
venue within the State of Georgia for the purpose of litigation to enforce
this Agreement, the Notes or the other Loan Documents, and (c) agrees that
service of process may be made upon it in the manner prescribed in Section
9.01 for the giving of notice to the Borrower. Nothing herein contained,
however, shall prevent the Agent from bringing any action or exercising any
rights against any security and against the Borrower personally, and
against any assets of the Borrower, within any other state or
jurisdiction.
SECTION 9.17. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
SECTION 9.18. Knowledge of Borrower. Whenever this Agreement or any
other Loan Document refers to the knowledge, best knowledge or awareness of
the Borrower or any Subsidiary, it is referring to the knowledge of a
Responsible Officer.
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73
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, under seal, by their respective authorized officers as of
the day and year first above written.
KEMET CORPORATION
By:/S/ ▇.▇. ▇▇▇▇▇▇▇ (SEAL)
Title: Chief Financial Officer
ATTEST:
/S/ ▇.▇. ▇▇▇▇▇▇ KEMET Corporation
Secretary ▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
74
WACHOVIA BANK OF GEORGIA, N.A.,
as Agent
By:/S/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (SEAL)
Title: Vice President
Notice Address
Wachovia Bank of Georgia, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
75
COMMITMENTS
$15,000,000.00 WACHOVIA BANK OF SOUTH CAROLINA, N.A.
By:/S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (SEAL)
Title: Assistant Vice President
Lending Office
Wachovia Bank of South Carolina, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
76
$35,000,000.00 WACHOVIA BANK OF NORTH CAROLINA, N.A.
By:/S/ R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (SEAL)
Title: Senior Vice President
Lending Office
Wachovia Bank of North Carolina, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇: NC 21315
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number (▇▇▇) ▇▇▇-▇▇▇▇
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77
$30,000,000.00 ABN AMRO BANK N.V. ATLANTA AGENCY,
as Co-Agent and Bank
By:/S/ ▇.▇. ▇▇▇▇▇▇ (SEAL)
Title: Group Vice President
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (SEAL)
Title: Vice President
Lending Office
ABN AMRO Bank N.V. Atlanta Agency
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
78
$25,000,000.00 FIRST UNION NATIONAL BANK
OF SOUTH CAROLINA
By:/S/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ (SEAL)
Title: Senior Vice President
Lending Office
First Union National Bank of South
Carolina
One Insignia Financial ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, III
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
79
$15,000,000.00 PNC BANK, NATIONAL ASSOCIATION
By:/S/ ▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
Title: Vice President
Lending Office
PNC Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Banking
- Southeast Group
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
80
$15,000,000.00 NBD BANK
By:/S/ ▇.▇. ▇▇▇▇▇▇▇▇ (SEAL)
Title: Authorized Agent
Lending Office
NBD Bank
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
81
$15,000,000.00 SUNTRUST BANK, ATLANTA
By:/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
Title: Vice President
and by: /S/ ▇.▇. ▇▇▇▇
Banking Officer
Lending Office
Suntrust Bank, Atlanta
▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
[The remainder of this page left blank intentionally]
82
$15,000,000.00 THE SAKURA BANK, LIMITED
By: /S/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (SEAL)
Title: Vice President & Senior Manager
Lending Office
The Sakura Bank, Limited
Marquis One Tower
Suite 2703
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Hutch ▇▇▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
TOTAL COMMITMENTS
$165,000,000.00