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Exhibit 10.14
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CREDIT AGREEMENT
among
GEO SPECIALTY CHEMICALS, INC.,
VARIOUS LENDING INSTITUTIONS,
and
BANKERS TRUST COMPANY,
As Administrative Agent
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Dated as of March 25, 1997
and
Amended and Restated as of July 31, 1998
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$25,000,000
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CREDIT AGREEMENT, dated as of March 25, 1997 and amended and
restated as of July 31, 1998, among GEO SPECIALTY CHEMICALS, INC., an Ohio
corporation (the "Borrower"), the lending institutions party hereto from time to
time (each a "Bank" and, collectively, the "Banks"), and BANKERS TRUST COMPANY,
as administrative agent (the "Administrative Agent"). Unless otherwise defined
herein, all capitalized terms used herein and defined in Section 10 are used
herein as so defined.
W I T N E S S E T H :
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WHEREAS, the Borrower, the Existing Banks and Bankers Trust
Company, as administrative agent thereunder, are party to a credit agreement,
dated as of March 25, 1997 (as amended, modified or supplemented to, but not
including, the Restatement Effective Date, the "Existing Credit Agreement"); and
WHEREAS, the Borrower has requested that the Existing Credit
Agreement be amended and restated in its entirety, and the Banks and the
Administrative Agent are willing to amend and restate the same, upon the terms
and conditions set forth herein;
NOW, THEREFORE, the parties hereto agree that, on the
Restatement Effective Date, the Existing Credit Agreement shall be, and hereby
is, amended and restated in its entirety as follows:
SECTION 1. AMOUNT AND TERMS OF CREDIT.
1.01 COMMITMENTS. (a) Subject to and upon the terms and
conditions set forth herein, each Bank severally agrees, at any time and from
time to time on and after the Restatement Effective Date and prior to the
Maturity Date, to make a revolving loan or revolving loans (each, a "Revolving
Loan" and, collectively, the "Revolving Loans") to the Borrower, which Revolving
Loans (i) shall, at the option of the Borrower, be Base Rate Loans or Eurodollar
Loans, PROVIDED that except as otherwise specifically provided in Section
1.10(b), all Revolving Loans comprising the same Borrowing shall at all times be
of the same Type, (ii) may be repaid and reborrowed in accordance with the
provisions hereof, (iii) shall not exceed for any Bank at any time outstanding
that aggregate principal amount which, when added to the product of (x) such
Bank's Adjusted RC Percentage and (y) the sum of (I) the aggregate amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) at such time and (II) the aggregate principal
amount of all Swingline Loans (exclusive of Swingline Loans which are repaid
with the
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proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) then outstanding, equals the Revolving Loan
Commitment of such Bank at such time and (iv) shall not exceed for all Banks at
any time outstanding that aggregate principal amount which, when added to (x)
the amount of all Letter of Credit Outstandings (exclusive of Unpaid Drawings
which are repaid with the proceeds of, and simultaneously with the incurrence
of, the respective incurrence of Revolving Loans) at such time and (y) the
aggregate principal amount of all Swingline Loans (exclusive of Swingline Loans
which are repaid with the proceeds of, and simultaneously with the incurrence
of, the respective incurrence of Revolving Loans) then outstanding, equals the
Adjusted Total Revolving Loan Commitment at such time.
(b) Subject to and upon the terms and conditions set forth
herein, the Swingline Bank in its individual capacity agrees to make at any time
and from time to time on and after the Restatement Effective Date and prior to
the Swingline Expiry Date, a revolving loan or revolving loans to the Borrower
(each a "Swingline Loan," and, collectively, the "Swingline Loans"), which
Swingline Loans (i) shall be made and maintained as Base Rate Loans, (ii) may be
repaid and reborrowed in accordance with the provisions hereof, (iii) shall not
exceed in aggregate principal amount at any time outstanding, when combined with
the aggregate principal amount of all Revolving Loans made by Non-Defaulting
Banks then outstanding and the Letter of Credit Outstandings (exclusive of
Unpaid Drawings which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Swingline Loans) at such time,
an amount equal to the Adjusted Total Revolving Loan Commitment then in effect
(after giving effect to any reductions to the Adjusted Total Revolving Loan
Commitment on such date) and (iv) shall not exceed in aggregate principal amount
at any time outstanding the Maximum Swingline Amount. The Swingline Bank will
not make a Swingline Loan after it has received written notice from the Required
Banks that one or more of the applicable conditions to Credit Events specified
in Section 5 are not then satisfied.
(c) On any Business Day, the Swingline Bank may, in its sole
discretion, give notice to the Banks that its outstanding Swingline Loans shall
be funded with a Borrowing of Revolving Loans (PROVIDED that each such notice
shall be deemed to have been automatically given upon the occurrence of an Event
of Default under Section 9.05 or upon the exercise of any of the remedies
provided in the last paragraph of Section 9), in which case a Borrowing of
Revolving Loans constituting Base Rate Loans (each such Borrowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day by all
Banks PRO RATA based on each Bank's Adjusted RC Percentage, and the proceeds
thereof shall be applied directly to repay the Swingline Bank for such
outstanding Swingline Loans. Each Bank hereby irrevocably agrees to make Base
Rate Loans upon one Business Day's notice pursuant to each Mandatory Borrowing
in the amount and in the manner specified in the preceding sentence and on the
date specified in writing by the Swingline Bank notwithstanding (i) that the
amount of the Mandatory Borrowing may not comply with the Minimum Borrowing
Amount otherwise required hereunder, (ii) whether any conditions specified in
Section 5 are then satisfied, (iii) whether a Default or an Event of Default has
occurred and is continuing, (iv) the date of such Mandatory Borrowing and (v)
any reduction in the Total Revolving Loan Commitment or the Adjusted Total
Revolving Loan Commitment after any such Swingline Loans were made. In the event
that any Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code in respect of the Borrower), each Bank
(other than the Swingline Bank) hereby agrees that it shall forthwith purchase
from the Swingline Bank (without
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recourse or warranty) such assignment of the outstanding Swingline Loans as
shall be necessary to cause the Banks to share in such Swingline Loans ratably
based upon their respective Adjusted RC Percentages, PROVIDED that (x) all
interest payable on the Swingline Loans shall be for the account of the
Swingline Bank until the date the respective assignment is purchased and, to the
extent attributable to the purchased assignment, shall be payable to the Bank
purchasing same from and after such date of purchase and (y) at the time any
purchase of participations pursuant to this sentence is actually made, the
purchasing Bank shall be required to pay the Swingline Bank interest on the
principal amount of participation purchased for each day from and including the
day upon which the Mandatory Borrowing would otherwise have occurred to but
excluding the date of payment for such participation, at the overnight Federal
Funds Effective Rate for the first three days and at the rate otherwise
applicable to Revolving Loans maintained as Base Rate Loans hereunder for each
day thereafter.
1.02 MINIMUM BORROWING AMOUNTS, ETC. The aggregate principal
amount of each Borrowing of Revolving Loans shall not be less than the Minimum
Borrowing Amount and, if greater, shall be in integral multiples of $100,000.
The aggregate principal amount of each Borrowing of Swingline Loans shall not be
less than $100,000 and, if greater, shall be in integral multiples of $100,000.
More than one Borrowing may be incurred on any day, PROVIDED that at no time
shall there be outstanding more than six Borrowings of Eurodollar Loans.
1.03 NOTICE OF BORROWING. (a) Whenever the Borrower desires to
incur Revolving Loans (excluding Borrowings of Revolving Loans incurred pursuant
to a Mandatory Borrowing), the Borrower shall give the Administrative Agent at
its Notice Office, prior to 11:00 A.M. (New York time), at least three Business
Days' prior written notice (or telephonic notice promptly confirmed in writing)
of each Borrowing of Eurodollar Loans to be made hereunder and, except as
provided in Section 1.03(c), at least one Business Day's prior written notice
(or telephonic notice promptly confirmed in writing) of each Borrowing of Base
Rate Loans to be made hereunder. Each such Notice of Borrowing shall be in the
form of Exhibit A and shall be irrevocable and shall specify (i) that such
Borrowing is to consist of Revolving Loans, (ii) the aggregate principal amount
of the Revolving Loans to be made pursuant to such Borrowing, (iii) the date of
Borrowing (which shall be a Business Day) and (iv) whether the respective
Borrowing shall consist of Base Rate Loans or (to the extent permitted)
Eurodollar Loans and, if Eurodollar Loans, the Interest Period to be initially
applicable thereto. The Administrative Agent shall promptly give each Bank
written notice (or telephonic notice on that day promptly confirmed in writing)
of each proposed Borrowing, of such Bank's proportionate share thereof and of
the other matters covered by the Notice of Borrowing.
(b)(i) Whenever the Borrower desires to incur a Borrowing of
Swingline Loans hereunder, the Borrower shall give the Swingline Bank prior to
12:00 Noon (New York time) on the day such Swingline Loan is to be made, written
notice (or telephonic notice promptly confirmed in writing) of each Swingline
Loan to be made hereunder. Each such Notice of Borrowing shall be irrevocable
and shall specify in each case (x) that such Borrowing is to consist of a
Swingline Loan, (y) the date of Borrowing (which shall be a Business Day) and
(z) the aggregate principal amount of the Swingline Loan to be made pursuant to
such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice
specified in Section 1.01(c), with the Borrower irrevocably agreeing, by its
incurrence of any Swingline Loan, to the making of Mandatory Borrowings as set
forth in such Section 1.01(c).
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(c) In the case of a Notice of Borrowing given by the Borrower
with respect to Eurodollar Loans which has been deemed rescinded pursuant to
clause (x) of the last sentence of Section 1.10, the Borrower shall be permitted
to deliver a substitute Notice of Borrowing providing for (x) an equal aggregate
amount of Base Rate Loans and (y) notwithstanding the one Business Day notice
period otherwise required by Section 1.03(a), a Borrowing on the date originally
set forth in the rescinded Notice of Borrowing.
(d) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice of any Borrowing of Loans, the
Administrative Agent or the Swingline Bank, as the case may be, may act without
liability upon the basis of telephonic notice of such Borrowing, believed by the
Administrative Agent or the Swingline Bank, as the case may be, in good faith to
be from the President or the Chief Financial Officer of the Borrower (or any
other officer of the Borrower designated in writing to the Administrative Agent
and the Swingline Bank by the President or the Chief Financial Officer as being
authorized to give such notices under this Agreement) prior to receipt of
written confirmation. In each such case, the Borrower hereby waives the right to
dispute the Administrative Agent's and the Swingline Bank's record of the terms
of such telephonic notice of such Borrowing of Loans.
1.04 DISBURSEMENT OF FUNDS. (a) No later than 12:00 Noon (New
York time) on the date specified in each Notice of Borrowing, each Bank will
make available its PRO RATA share of each Borrowing requested to be made on such
date in the manner provided below, PROVIDED that all Swingline Loans shall be
made available by the Swingline Bank no later than 3:00 P.M. (New York time) on
the date so requested. All such amounts shall be made available to the
Administrative Agent in U.S. dollars and immediately available funds at the
Payment Office and the Administrative Agent promptly will make available to the
Borrower by depositing to its account at the Payment Office the aggregate of the
amounts so made available in the type of funds received. Unless the
Administrative Agent shall have been notified by any Bank prior to the date of
Borrowing that such Bank does not intend to make available to the Administrative
Agent its portion of the Borrowing or Borrowings to be made on such date, the
Administrative Agent may assume that such Bank has made such amount available to
the Administrative Agent on such date of Borrowing, and the Administrative
Agent, in reliance upon such assumption, may (in its sole discretion and without
any obligation to do so) make available to the Borrower a corresponding amount.
If such corresponding amount is not in fact made available to the Administrative
Agent by such Bank and the Administrative Agent has made available same to the
Borrower, the Administrative Agent shall be entitled to recover such
corresponding amount from such Bank. If such Bank does not pay such
corresponding amount forthwith upon the Administrative Agent's demand therefor,
the Administrative Agent shall promptly notify the Borrower, and the Borrower
shall immediately pay such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover on demand from such Bank
or the Borrower, as the case may be, interest on such corresponding amount in
respect of each day from the date such corresponding amount was made available
by the Administrative Agent to the Borrower to the date such corresponding
amount is recovered by the Administrative Agent, at a rate per annum equal to
(x) if paid by such Bank, the overnight Federal Funds Effective Rate or (y) if
paid by the Borrower, the then applicable rate of interest, calculated in
accordance with Section 1.08, for the respective Revolving Loans.
(b) Nothing herein shall be deemed to relieve any Bank from
its obligation to fulfill its commitments hereunder or to prejudice any rights
which the Borrower may have against any
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Bank as a result of any default by such Bank hereunder.
1.05 NOTES. (a) The Borrower's obligation to pay the principal
of, and interest on, the Loans shall be evidenced (i) if Revolving Loans, by a
promissory note duly executed and delivered by the Borrower substantially in the
form of Exhibit B-1, with blanks appropriately completed in conformity herewith
(each, a "Revolving Note" and, collectively, the "Revolving Notes") and (ii) if
Swingline Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-2, with blanks appropriately
completed in conformity herewith (the "Swingline Note").
(b) The Revolving Note issued to each Bank shall (i) be
executed by the Borrower, (ii) be payable to the order of such Bank and be dated
the Restatement Effective Date (or, in the case of any Revolving Note issued
after the Restatement Effective Date, be dated the date of the issuance
thereof), (iii) be in a stated principal amount equal to the Revolving Loan
Commitment of such Bank and be payable in the principal amount of the Revolving
Loans evidenced thereby from time to time, (iv) mature on the Maturity Date, (v)
bear interest as provided in the appropriate clause of Section 1.08 in respect
of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced
thereby, (vi) be subject to voluntary prepayment as provided in Section 4.01 and
mandatory repayment as provided in Section 4.02 and (vii) be entitled to the
benefits of this Agreement and the other Credit Documents.
(c) The Swingline Note issued to the Swingline Bank shall (i)
be executed by the Borrower, (ii) be payable to the order of the Swingline Bank
and be dated the Restatement Effective Date (or, in the case of any Swingline
Note issued after the Restatement Effective Date, be dated the date of the
issuance thereof), (iii) be in a stated principal amount equal to the Maximum
Swingline Amount and be payable in the principal amount of the outstanding
Swingline Loans evidenced thereby from time to time, (iv) mature on the
Swingline Expiry Date, (v) bear interest as provided in the appropriate clause
of Section 1.08 in respect of the Base Rate Loans evidenced thereby and (vi) be
entitled to the benefits of this Agreement and the other Credit Documents.
(d) Each Bank will note on its internal records the amount of
each Revolving Loan made by it and each payment in respect thereof and will,
prior to any transfer of its Revolving Note, endorse on the reverse side thereof
the outstanding principal amount of Revolving Loans evidenced thereby. Such
notation shall be conclusive absent manifest error, although the failure to make
any such notation shall not affect the Borrower's obligations in respect of such
Revolving Loans.
1.06 CONVERSIONS. The Borrower shall have the option to
convert on any Business Day occurring on or after the Restatement Effective
Date, all or a portion at least equal to the applicable Minimum Borrowing Amount
of the outstanding principal amount of Revolving Loans made pursuant to one or
more Borrowings (it being understood that Swingline Loans will at all times be
maintained as Base Rate Loans) of one or more Types of Revolving Loans into a
Borrowing or Borrowings of another Type of Revolving Loan, PROVIDED that (i)
except as otherwise provided in Section 1.10(b), Eurodollar Loans may be
converted into Base Rate Loans only on the last day of an Interest Period
applicable thereto and no partial conversion of a Borrowing of Eurodollar Loans
shall reduce the outstanding principal amount of the Eurodollar Loans made
pursuant to such Borrowing to less than the Minimum Borrowing Amount, (ii) Base
Rate Loans may not be converted into Eurodollar Loans if a violation of Section
9.01 or 9.05 or an Event of Default is in existence on
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the date of the conversion and the Administrative Agent or the Required Banks
have determined that such conversion at such time would be disadvantageous to
the Banks and (iii) Borrowings of Eurodollar Loans resulting from this Section
1.06 shall be limited in number as provided in Section 1.02. Each such
conversion shall be effected by the Borrower giving the Administrative Agent at
its Notice Office, prior to 11:00 A.M. (New York time), at least three Business
Days' (or two Business Days', in the case of a conversion into Base Rate Loans)
prior written notice (or telephonic notice promptly confirmed in writing) (each
a "Notice of Conversion") specifying the Revolving Loans to be so converted, the
Type of Loans to be converted into and, if to be converted into a Borrowing of
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Administrative Agent shall give each Bank prompt notice of any such proposed
conversion affecting any of its Revolving Loans.
1.07 PRO RATA BORROWINGS. All Borrowings of Revolving Loans
under this Agreement shall be incurred from the Banks PRO RATA on the basis of
their Revolving Loan Commitments. It is understood that no Bank shall be
responsible for any default by any other Bank in its obligation to make
Revolving Loans hereunder and that each Bank shall be obligated to make the
Revolving Loans provided to be made by it hereunder, regardless of the failure
of any other Bank to fulfill its commitments hereunder.
1.08 INTEREST. (a) The unpaid principal amount of each Base
Rate Loan shall bear interest from the date of the Borrowing thereof until the
earlier of (i) the maturity (whether by acceleration or otherwise) of such Base
Rate Loan and (ii) the conversion of such Base Rate Loan to a Eurodollar Loan
pursuant to Section 1.06 at a rate per annum which shall at all times be the
Base Rate Margin plus the Base Rate in effect from time to time.
(b) The unpaid principal amount of each Eurodollar Loan shall
bear interest from the date of the Borrowing thereof until the earlier of (i)
the maturity (whether by acceleration or otherwise) of such Eurodollar Loan and
(ii) the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to
Section 1.06 or 1.09, as applicable, at a rate per annum which shall at all
times be the Eurodollar Margin plus the relevant Eurodollar Rate.
(c) All overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount payable
hereunder shall bear interest at a rate per annum equal to the greater of (x) 2%
per annum in excess of the rate otherwise applicable to Base Rate Loans from
time to time and (y) the rate which is 2% in excess of the rate borne by such
Loans at the time such payment becomes due, in each case with such interest to
be payable on demand.
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any repayment thereof and shall be
payable (i) in respect of each Base Rate Loan, in arrears on each Quarterly
Payment Date, (ii) in respect of each Eurodollar Loan, on the last day of each
Interest Period applicable thereto and, in the case of an Interest Period of
longer than three months, every three months after the first day of such
Interest Period and (iii) in respect of each Loan, on any prepayment or
conversion (other than the prepayment and conversion of Revolving Loans that are
maintained as Base Rate Loans) (on the amount prepaid or converted), at maturity
(whether by acceleration or otherwise) and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section
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12.07(b).
(f) The Administrative Agent, upon determining the interest
rate for any Borrowing of Eurodollar Loans for any Interest Period, shall
promptly notify the Borrower and the Banks thereof.
1.09 INTEREST PERIODS. (a) At the time the Borrower gives a
Notice of Borrowing or Notice of Conversion in respect of the making of, or
conversion into, a Borrowing of Eurodollar Loans (in the case of the initial
Interest Period applicable thereto) or prior to 11:00 A.M. (New York time) on
the third Business Day prior to the expiration of an Interest Period applicable
to a Borrowing of Eurodollar Loans, the Borrower shall have the right to elect,
by giving the Administrative Agent written notice (or telephonic notice promptly
confirmed in writing), the Interest Period applicable to such Borrowing, which
Interest Period shall, at the option of the Borrower, be a one, two, three, six
or, if available to all Banks, twelve month period. Notwithstanding anything to
the contrary contained above:
(i) all Eurodollar Loans comprising a single Borrowing shall at
all times have the same Interest Period;
(ii) the initial Interest Period for any Borrowing of Eurodollar
Loans shall commence on the date of such Borrowing (including the date
of any conversion from a Borrowing of Base Rate Loans) and each
Interest Period occurring thereafter in respect of such Borrowing shall
commence on the day on which the next preceding Interest Period
expires;
(iii) if any Interest Period begins on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day, PROVIDED that if any Interest Period
would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business
Day;
(v) no Interest Period shall extend beyond the Maturity Date;
and
(vi) no Interest Period may be elected at any time when a
violation of Section 9.01 or 9.05 or an Event of Default is then in
existence and the Administrative Agent or the Required Banks have
determined that such an election at such time would be disadvan-
tageous to the Banks.
(b) If upon the expiration of any Interest Period, the
Borrower has failed to (or may not) elect a new Interest Period to be applicable
to the respective Borrowing of Eurodollar Loans as provided above, the Borrower
shall be deemed to have elected to convert such Borrowing into a Borrowing of
Base Rate Loans effective as of the expiration date of such current Interest
Period.
1.10 INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that
(x) in the case of clause (i) below, the Administrative Agent or (y) in the case
of clauses (ii) and (iii) below, any Bank shall
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have determined (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising after the date
of this Agreement affecting the interbank Eurodollar market, adequate
and fair means do not exist for ascertaining the applicable interest
rate on the basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder in an amount
which such Bank deems material with respect to any Eurodollar Loans
(other than any increased cost or reduction in the amount received or
receivable resulting from the imposition of or a change in the rate of
Taxes or other similar charges) because of (x) any change since the
Restatement Effective Date in any applicable law, governmental rule,
regulation, guideline or order (whether or not having the force of law)
or in the interpretation or administration thereof and including the
introduction of any new law or governmental rule, regulation, guideline
or order (such as, for example, but not limited to, a change in
official reserve requirements, but, in all events, excluding reserves
required under Regulation D to the extent included in the computation
of the Eurodollar Rate) and/or (y) other circumstances occurring after
the Restatement Effective Date adversely affecting the interbank
Eurodollar market or the position of such Bank in such market; or
(iii) at any time after the Restatement Effective Date, that the
making or continuance of any Eurodollar Loan has become unlawful by
compliance by such Bank in good faith with any law, governmental rule,
regulation, guideline or order (or would conflict with any such
governmental rule, regulation, guideline or order not having the force
of law but with which such Bank customarily complies even though the
failure to comply therewith would not be unlawful);
then, and in any such event, such Bank (or the Administrative Agent in the case
of clause (i) above) shall (x) on such date and (y) within ten Business Days of
the date on which such event no longer exists give notice (by telephone
confirmed in writing) to the Borrower and to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly transmit to
each of the other Banks). Thereafter (x) in the case of clause (i) above,
Eurodollar Loans shall no longer be available until such time as the
Administrative Agent notifies the Borrower and the Banks that the circumstances
giving rise to such notice by the Administrative Agent no longer exist, and any
Notice of Borrowing or Notice of Conversion given by the Borrower with respect
to Eurodollar Loans which have not yet been incurred shall be deemed rescinded
by the Borrower, (y) in the case of clause (ii) above, the Borrower shall,
subject to the provisions of Section 12.17 (to the extent applicable), pay to
such Bank, upon written demand therefor, such additional amounts (in the form of
an increased rate of, or a different method of calculating, interest or
otherwise as such Bank in its sole discretion shall determine) as shall be
required to compensate such Bank for such increased costs or reductions in
amounts receivable hereunder (a written notice as to the additional amounts owed
to such Bank, showing the basis for the calculation thereof, which basis shall
be reasonable, submitted to the Borrower by such Bank shall, absent manifest
error, be final and conclusive and binding upon all parties hereto) and (z) in
the case of clause (iii) above, the Borrower shall take one of the actions
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specified in Section 1.10(b) as promptly as possible and, in any event, within
the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected pursuant to Section 1.10(a)(iii), the
Borrower shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, cancel said Borrowing by giving the Administrative
Agent telephonic notice (confirmed promptly in writing) thereof on the same date
that the Borrower was notified by a Bank pursuant to Section 1.10(a)(ii) or
(iii), or (ii) if the affected Eurodollar Loan is then outstanding, upon at
least three Business Days' notice to the Administrative Agent, require the
affected Bank to convert each such Eurodollar Loan into a Base Rate Loan,
PROVIDED that if more than one Bank is so affected at any time, then all
affected Banks must be treated the same pursuant to this Section 1.10(b).
(c) If any Bank shall have determined that after the
Restatement Effective Date, the adoption or effectiveness of any applicable law,
rule or regulation regarding capital adequacy, or any change therein, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged by relevant authority with
the interpretation or administration thereof, or compliance by such Bank (or any
corporation controlling such Bank) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing by
an amount reasonably deemed by such Bank to be material the rate of return on
such Bank's (or such controlling corporation's) capital or assets as a
consequence of its commitments or obligations hereunder to a level below that
which such Bank (or such controlling corporation) could have achieved but for
such adoption, effectiveness, change or compliance (taking into consideration
such Bank's (or such controlling corporation's) policies with respect to capital
adequacy), then from time to time, within 15 days after written demand by such
Bank (with a copy to the Administrative Agent and accompanied by the notice
described in the last sentence of this Section 1.10(c)), the Borrower shall,
subject to the provisions of Section 12.17 (to the extent applicable), pay to
such Bank such additional amount or amounts as will compensate such Bank (or
such controlling corporation) for such reduction. Each Bank, upon determining in
good faith that any additional amounts will be payable pursuant to this Section
1.10(c), will give prompt written notice thereof to the Borrower, which notice
shall set forth in reasonable detail the basis of the calculation of such
additional amounts, which basis shall be reasonable, although the failure to
give any such notice shall not release or diminish any of the Borrower's
obligations to pay additional amounts pursuant to this Section 1.10(c) upon the
subsequent receipt of such notice.
1.11 COMPENSATION; BREAKAGE. The Borrower shall, subject to
the provisions of Section 12.17 (to the extent applicable), compensate each
Bank, upon its written request (which request shall set forth the reasonably
detailed basis for requesting and the method of calculating such compensation),
for all reasonable losses, expenses and liabilities (including, without
limitation, any loss, expense or liability incurred by reason of the liquidation
or reemployment of deposits or other funds required by such Bank to fund its
Eurodollar Loans but excluding in any event the loss of anticipated profits)
which such Bank may sustain: (i) if for any reason (other than a default by such
Bank or the Administrative Agent) a Borrowing of Eurodollar Loans does not occur
on a date specified therefor in a Notice of Borrowing or Notice of Conversion
(whether or not withdrawn by the Borrower or deemed withdrawn pursuant to
Section 1.10(a)); (ii) if any prepayment, repayment
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or conversion of any of its Eurodollar Loans occurs on a date which is not the
last day of an Interest Period applicable thereto (other than any prepayment or
repayment made by the Borrower upon the Administrative Agent's demand therefor
following a Bank's failure to make available its PRO RATA share of a Borrowing
as set forth in the last three sentences of Section 1.04(a)); (iii) if any
prepayment of any of its Eurodollar Loans is not made on any date specified in a
notice of prepayment given by the Borrower; or (iv) as a consequence of (x) any
other default by the Borrower to repay its Eurodollar Loans when required by the
terms of this Agreement or (y) an election made pursuant to Section 1.10(b).
1.12 CHANGE OF LENDING OFFICE. Each Bank agrees that, upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), 1.10(c), 2.06 or 4.04 with respect to such Bank, it will, if requested by
the Borrower, use reasonable efforts (subject to overall policy considerations
of such Bank) to designate another lending office for any Loans, its Revolving
Loan Commitment or Letters of Credit, as the case may be, if affected by such
event, PROVIDED that such designation is made on such terms that such Bank and
its lending office suffer no economic, legal or regulatory disadvantage, with
the object of avoiding the consequence of the event giving rise to the operation
of any such Section. Nothing in this Section 1.12 shall affect or postpone any
of the obligations of the Borrower or the right of any Bank provided in Section
1.10, 2.06 or 4.04.
1.13 REPLACEMENT OF BANKS. (x) Upon the occurrence of any
event giving rise to the operation of Section 1.10(a)(ii) or (iii), Section
1.10(c), Section 2.06 or Section 4.04 with respect to any Bank which results in
such Bank charging to the Borrower increased costs in excess of those being
generally charged by the other Banks or becoming incapable of making Eurodollar
Loans, (y) if a Bank becomes a Defaulting Bank and/or (z) in the case of a
refusal by a Bank to consent to a proposed change, waiver, discharge or
termination with respect to this Agreement which has been approved by the
Required Banks as provided in Section 12.12(b), the Borrower shall have the
right, if no Default or Event of Default then exists, to replace such Bank (the
"Replaced Bank") with one or more other Eligible Transferees reasonably
acceptable to the Administrative Agent, none of whom shall constitute a
Defaulting Bank at the time of such replacement (collectively, the "Replacement
Bank"), PROVIDED that (i) at the time of any replacement pursuant to this
Section 1.13, the Replacement Bank shall enter into one or more Assignment
Agreements pursuant to Section 12.04(b) (and with all fees payable pursuant to
said Section 12.04(b) to be paid by the Replacement Bank) pursuant to which the
Replacement Bank shall acquire the entire Revolving Loan Commitment and
outstanding Revolving Loans of, and participations in Letters of Credit by, the
Replaced Bank and, in connection therewith, shall pay to (x) the Replaced Bank
in respect thereof an amount equal to the sum of (I) an amount equal to the
principal of, and all accrued interest on, all outstanding Revolving Loans of
the Replaced Bank, (II) an amount equal to all Unpaid Drawings that have been
funded by (and not reimbursed to) such Replaced Bank, together with all then
unpaid interest with respect thereto at such time and (III) an amount equal to
all accrued, but theretofore unpaid, Fees owing to the Replaced Bank pursuant to
Section 3.01, (y) the respective Letter of Credit Issuer an amount equal to such
Replaced Bank's Adjusted RC Percentage (for this purpose, determined as if the
adjustment described in clause (B) of the succeeding sentence had been made with
respect to such Replaced Bank) of any Unpaid Drawing (which at such time remains
an Unpaid Drawing) to the extent such amount was not theretofore funded by such
Replaced Bank and (z) the Swingline Bank an amount equal to such Replaced Bank's
Adjusted RC Percentage (for this purpose, determined as if the adjustment
described in clause (B) of the succeeding sentence had been made with respect to
such Replaced Bank) of any Mandatory Borrowing to the extent such amount
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was not theretofore funded by such Replaced Bank and (ii) all obligations of the
Borrower owing to the Replaced Bank (other than those specifically described in
clause (i) above in respect of which the assignment purchase price has been, or
is concurrently being, paid) shall be paid in full to such Replaced Bank
concurrently with such replacement. Upon the execution of the respective
Assignment Agreements, the payment of amounts referred to in clauses (i) and
(ii) above and, if so requested by the Replacement Bank, delivery to the
Replacement Bank of the appropriate Revolving Note executed by the Borrower, (A)
the Replacement Bank shall become a Bank hereunder and the Replaced Bank shall
cease to constitute a Bank hereunder, except with respect to indemnification
provisions applicable to the Replaced Bank under this Agreement, which shall
survive as to such Replaced Bank and (B) in the case of a replacement of a
Defaulting Bank, the Adjusted RC Percentage of the Banks shall be automatically
adjusted at such time to give effect to such replacement (and to give effect to
the replacement of a Defaulting Bank with one or more Non- Defaulting Banks).
SECTION 2. LETTERS OF CREDIT.
2.01 LETTERS OF CREDIT. (a) (i) Subject to and upon the terms
and conditions set forth herein, the Borrower may request a Letter of Credit
Issuer at any time and from time to time on or after the Restatement Effective
Date and prior to the thirtieth day prior to the Maturity Date to issue (x) for
the account of the Borrower and for the benefit of any holder (or any trustee,
agent or other similar representative for any such holders) of L/C Supportable
Obligations of the Borrower or any of its Subsidiaries, an irrevocable sight
standby letter of credit, in a form customarily used by such Letter of Credit
Issuer or in such other form as has been approved by such Letter of Credit
Issuer (each such standby letter of credit, a "Standby Letter of Credit") in
support of such L/C Supportable Obligations and (y) for the account of the
Borrower and for the benefit of sellers of goods or materials to the Borrower or
any of its Subsidiaries, an irrevocable sight commercial letter of credit in a
form customarily used by such Letter of Credit Issuer or in such other form as
has been approved by such Letter of Credit Issuer (each such commercial letter
of credit, a "Trade Letter of Credit", and each such Trade Letter of Credit and
each Standby Letter of Credit, a "Letter of Credit") in support of commercial
transactions of the Borrower and its Subsidiaries, and (ii) subject to and upon
the terms and conditions set forth herein such Letter of Credit Issuer agrees to
issue from time to time, irrevocable Letters of Credit in such form as may be
approved by such Letter of Credit Issuer and the Administrative Agent. Annex III
contains a description of all Letters of Credit (as defined in the Existing
Credit Agreement) issued by a Letter of Credit Issuer pursuant to Section 2 of
the Existing Credit Agreement which remain outstanding on the Restatement
Effective Date. Each such letter of credit, including any extension thereof
(each an "Existing Letter of Credit") shall constitute a "Letter of Credit" for
all purposes of this Agreement and shall be deemed issued for purposes of
Sections 2.04(a) and 3.01(b) and (c) on the Restatement Effective Date.
Notwithstanding the foregoing, no Letter of Credit Issuer shall be under any
obligation to issue any Letter of Credit if at the time of such issuance:
(i) any order, judgment or decree of any governmental authority
or arbitrator shall purport by its terms to enjoin or restrain such
Letter of Credit Issuer from issuing such Letter of Credit or any
requirement of law applicable to such Letter of Credit Issuer or any
request or directive (whether or not having the force of law) from any
governmental authority with jurisdiction over such Letter of Credit
Issuer shall prohibit, or request that such Letter of Credit Issuer
refrain from, the issuance of letters of credit generally or such
Letter of Credit
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in particular or shall impose upon such Letter of Credit Issuer with
respect to such Letter of Credit any restriction or reserve or capital
requirement (for which such Letter of Credit Issuer is not otherwise
compensated) not in effect on the date hereof, or any unreimbursed
loss, cost or expense which was not applicable, in effect or known to
such Letter of Credit Issuer as of the date hereof and which such
Letter of Credit Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to it; or
(ii) such Letter of Credit Issuer shall have received notice
from the Borrower or the Required Banks prior to the issuance of such
Letter of Credit of the type described in clause (iv) of Section
2.01(b).
(b) Notwithstanding the foregoing, (i) no Letter of Credit
shall be issued, the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time, would
exceed either (x) $2,500,000 or (y) when added to the aggregate principal amount
of all Revolving Loans made by Non-Defaulting Banks and Swingline Loans then
outstanding, the Adjusted Total Revolving Loan Commitment at such time; (ii) (x)
each Standby Letter of Credit shall have an expiry date occurring not later than
one year after such Letter of Credit's date of issuance (although any Standby
Letter of Credit may be extendable (whether automatically or otherwise) for
successive periods of up to 12 months, but not beyond the tenth Business Day
prior to the Maturity Date), on terms acceptable to the respective Letter of
Credit Issuer and in no event shall any Standby Letter of Credit have an expiry
date occurring later than the tenth Business Day prior to the Maturity Date and
(y) each Trade Letter of Credit shall have an expiry date occurring no later
than the earlier of (a) 180 days after the issuance thereof or (b) 30 days prior
to the Maturity Date; (iii) each Letter of Credit shall be denominated in U.S.
dollars; and (iv) no Letter of Credit Issuer shall issue any Letter of Credit
after it has received written notice from the Borrower that a Default or an
Event of Default exists until such time as the Letter of Credit Issuers shall
have received written notice of (x) rescission of such notice from the party or
parties originally delivering the same or (y) waiver of such Default or Event of
Default by the Required Banks.
2.02 MINIMUM STATED AMOUNT. The initial Stated Amount of each
Letter of Credit shall be not less than $20,000 or such lesser amount acceptable
to the respective Letter of Credit Issuer.
2.03 LETTER OF CREDIT REQUESTS; NOTICES OF ISSUANCE; REPORTS.
(a) Whenever the Borrower desires that a Letter of Credit be issued, the
Borrower shall give the Administrative Agent and the respective Letter of Credit
Issuer a written request (including by way of telecopier) in the form of Exhibit
C prior to 1:00 P.M. (New York time) at least three Business Days (or such
shorter period as may be acceptable to such Letter of Credit Issuer) prior to
the proposed date (which shall be a Business Day) of issuance (each a "Letter of
Credit Request"), which Letter of Credit Request shall include any other
documents that such Letter of Credit Issuer customarily requires in connection
therewith.
(b) The respective Letter of Credit Issuer shall, promptly
after each issuance of or amendment to any Standby Letter of Credit by it, give
the Administrative Agent, each Bank and the Borrower written notice of the
issuance of or amendment to such Standby Letter of Credit, accompanied by a copy
of the issued Standby Letter of Credit or amendment, as the case may be.
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(c) Each Letter of Credit Issuer (other than BTCo) shall, by
11:00 A.M. on the first Business Day of each week, forward to the Administrative
Agent (by way of telecopier) a report listing the aggregate daily outstanding
balances for the previous week of the Trade Letters of Credit issued by such
Letter of Credit Issuer. Each month the Administrative Agent shall forward to
each Bank a report listing the daily aggregate amount available to be drawn
under all Trade Letters of Credit outstanding during the previous month.
2.04 AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. (a) The
Borrower hereby agrees to reimburse the respective Letter of Credit Issuer, by
making payment to the Administrative Agent at the Payment Office (which funds
the Administrative Agent shall promptly forward to such Letter of Credit
Issuer), for any payment or disbursement made by such Letter of Credit Issuer
under any Letter of Credit issued by it (each such amount so paid or disbursed
until reimbursed, an "Unpaid Drawing") immediately after, and in any event on
the date on which, the Borrower is notified by such Letter of Credit Issuer of
such payment or disbursement with interest on the amount so paid or disbursed by
such Letter of Credit Issuer, to the extent not reimbursed prior to 1:00 P.M.
(New York time) on the date of such payment or disbursement, from and including
the date paid or disbursed to but not including the date such Letter of Credit
Issuer is reimbursed therefor at a rate per annum which shall be the Base Rate
Margin then in effect plus the Base Rate as in effect from time to time (plus an
additional 2% per annum if not reimbursed by the third Business Day after the
date of such notice of payment or disbursement), such interest also to be
payable on demand. Each Letter of Credit Issuer shall provide the Borrower
prompt notice of any payment or disbursement made by it under any Letter of
Credit issued by it, although the failure of, or delay in, giving any such
notice shall not release or diminish the obligations of the Borrower under this
Section 2.04 (a) or under any other Section of this Agreement.
(b) The Borrower's obligation under this Section 2.04 to
reimburse the respective Letter of Credit Issuer with respect to Unpaid Drawings
(including, in each case, interest thereon) shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower may have or have had against such Letter
of Credit Issuer, the Administrative Agent or any Bank, including, without
limitation, any defense based upon the failure of any payment under a Letter of
Credit to conform to the terms of the Letter of Credit or any non-application or
misapplication by the beneficiary of the proceeds of such payment; PROVIDED,
that the Borrower shall not be obligated to reimburse any Letter of Credit
Issuer for any wrongful payment made by such Letter of Credit Issuer under a
Letter of Credit as a result of acts or omissions constituting willful
misconduct or gross negligence (in either case, as determined by a court of
competent jurisdiction) on the part of such Letter of Credit Issuer.
2.05 LETTER OF CREDIT PARTICIPATIONS. (a) Immediately upon the
issuance by any Letter of Credit Issuer of a Letter of Credit, such Letter of
Credit Issuer shall be deemed to have sold and transferred to each other Bank,
and each such Bank (each a "Participant") shall be deemed irrevocably and
unconditionally to have purchased and received from such Letter of Credit
Issuer, without recourse or warranty, an undivided interest and participation,
to the extent of such Bank's Adjusted RC Percentage, in such Letter of Credit,
each substitute letter of credit, each payment made thereunder and the
obligations of the Borrower under this Agreement with respect thereto (although
the Letter of Credit Fee shall be payable directly to the Administrative Agent
for the account of the Banks as provided in Section 3.01(b) and the Participants
shall have no right to receive any portion of any Facing Fees) and any security
therefor or guaranty pertaining thereto. Upon any change in
15
the Revolving Loan Commitments or Adjusted RC Percentages of the Banks pursuant
to Section 12.04(b) or upon a Bank Default, it is hereby agreed that, with
respect to all outstanding Letters of Credit and Unpaid Drawings, there shall be
an automatic adjustment to the participations pursuant to this Section 2.05 to
reflect the new Adjusted RC Percentages of the assigning and assignee Bank or of
all Banks, as the case may be.
(b) In determining whether to pay under any Letter of Credit,
the respective Letter of Credit Issuer shall not have any obligation relative to
the Participants other than to determine that any documents required to be
delivered under such Letter of Credit have been delivered and that they
substantially comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Letter of Credit Issuer
under or in connection with any Letter of Credit if taken or omitted in the
absence of gross negligence or willful misconduct (in either case, as determined
by a court of competent jurisdiction) shall not create for such Letter of Credit
Issuer any resulting liability.
(c) In the event that the respective Letter of Credit Issuer
makes any payment under any Letter of Credit and the Borrower shall not have
reimbursed such amount in full to such Letter of Credit Issuer pursuant to
Section 2.04(a), such Letter of Credit Issuer shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to the Administrative Agent for the account of such Letter
of Credit Issuer, the amount of such Participant's Adjusted RC Percentage of
such payment in U.S. dollars and in same day funds; PROVIDED, that no
Participant shall be obligated to pay to the Administrative Agent its Adjusted
RC Percentage of such unreimbursed amount for any wrongful payment made by such
Letter of Credit Issuer under a Letter of Credit as a result of acts or
omissions constituting willful misconduct or gross negligence (in either case,
as determined by a court of competent jurisdiction) on the part of such Letter
of Credit Issuer. If the Administrative Agent so notifies any Participant
required to fund an Unpaid Drawing under a Letter of Credit prior to 11:00 A.M.
(New York time) on any Business Day, such Participant shall make available to
the Administrative Agent for the account of the respective Letter of Credit
Issuer (which funds the Administrative Agent shall promptly forward to the
Letter of Credit Issuer) such Participant's Adjusted RC Percentage of the amount
of such payment on such Business Day in same day funds. If and to the extent
such Participant shall not have so made its Adjusted RC Percentage of the amount
of such Unpaid Drawing available to the Administrative Agent for the account of
such Letter of Credit Issuer, such Participant agrees to pay to the
Administrative Agent for the account of such Letter of Credit Issuer, forthwith
on demand such amount, together with interest thereon, for each day from such
date until the date such amount is paid to the Administrative Agent for the
account of such Letter of Credit Issuer at the overnight Federal Funds Effective
Rate. The failure of any Participant to make available to the Administrative
Agent for the account of the respective Letter of Credit Issuer its Adjusted RC
Percentage of any Unpaid Drawing under any Letter of Credit shall not relieve
any other Participant of its obligation hereunder to make available to the
Administrative Agent for the account of the respective Letter of Credit Issuer
its Adjusted RC Percentage of any payment under any Letter of Credit on the date
required, as specified above, but no Participant shall be responsible for the
failure of any other Participant to make available to the Administrative Agent
for the account of such Letter of Credit Issuer such other Participant's
Adjusted RC Percentage of any such payment.
(d) Whenever the respective Letter of Credit Issuer receives a
payment of a
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reimbursement obligation as to which the Administrative Agent has received for
the account of such Letter of Credit Issuer any payments from the Participants
pursuant to clause (c) above, such Letter of Credit Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its Adjusted RC Percentage thereof, in U.S. dollars
and in same day funds, an amount equal to such Participant's Adjusted RC
Percentage of the principal amount thereof and interest thereon accruing at the
overnight Federal Funds Effective Rate after the purchase of the respective
participations.
(e) Upon the request of any Participant, each Issuing Bank
shall furnish to such Participant copies of any Letter of Credit issued by it
and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to
the Administrative Agent for the account of the respective Letter of Credit
Issuer with respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever (PROVIDED that no Participant shall be required to make payments
resulting from the Letter of Credit Issuer's gross negligence or willful
misconduct (in either case, as determined by a court of competent jurisdiction)
and shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other right
which the Borrower or any of it Subsidiaries may have at any time
against a beneficiary named in a Letter of Credit, any transferee of
any Letter of Credit (or any Person for whom any such transferee may be
acting), the Administrative Agent, the respective Letter of Credit
Issuer, any Bank or other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein
or any unrelated transactions (including any underlying transaction
between the Borrower or any of its Subsidiaries and the beneficiary
named in any such Letter of Credit);
(iii) any draft, certificate or other document presented under
the Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
(g) To the extent the respective Letter of Credit Issuer is
not indemnified for same by the Borrower, the Participants will reimburse and
indemnify the Letter of Credit Issuer, in proportion to their respective
Adjusted RC Percentages, for and against any and all liabilities, obligations,
losses, damages, penalties, claims, actions, judgments, costs, expenses or
disbursements of whatsoever kind or nature which may be imposed on, asserted
against or incurred by such Letter of Credit Issuer in performing its respective
duties in any way relating to or arising out of its
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issuance of Letters of Credit; PROVIDED that no Participant shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from such
Letter of Credit Issuer's gross negligence or willful misconduct (in either
case, as determined by a court of competent jurisdiction).
2.06 INCREASED COSTS. If at any time after the Restatement
Effective Date, the adoption or effectiveness of any applicable law, rule or
regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged by relevant authority with the interpretation or administration
thereof, or compliance by the respective Letter of Credit Issuer or any Bank
with any request or directive (whether or not having the force of law) by any
such authority, central bank or comparable agency shall either (i) impose,
modify or make applicable any reserve, deposit, capital adequacy or similar
requirement against Letters of Credit issued by such Letter of Credit Issuer or
such Bank's participation therein, or (ii) shall impose on such Letter of Credit
Issuer or any Bank any other conditions affecting this Agreement, any Letter of
Credit or such Bank's participation therein; and the result of any of the
foregoing is to increase the cost to such Letter of Credit Issuer or such Bank
of issuing, maintaining or participating in any Letter of Credit, or to reduce
the amount of any sum received or receivable by such Letter of Credit Issuer or
such Bank hereunder (other than any increased cost or reduction in the amount
received or receivable resulting from the imposition of or a change in the rate
of taxes or similar charges), then, upon demand to the Borrower by such Letter
of Credit Issuer or such Bank (a copy of which notice shall be sent by such
Letter of Credit Issuer or such Bank to the Administrative Agent) and subject to
the provisions of Section 12.17 (to the extent applicable), the Borrower shall
pay to such Letter of Credit Issuer or such Bank such additional amount or
amounts as will compensate such Letter of Credit Issuer or such Bank for such
increased cost or reduction. A certificate submitted to the Borrower by the
respective Letter of Credit Issuer or such Bank, as the case may be (a copy of
which certificate shall be sent by such Letter of Credit Issuer or such Bank to
the Administrative Agent), setting forth in reasonable detail the basis for the
determination of such additional amount or amounts necessary to compensate such
Letter of Credit Issuer or such Bank as aforesaid shall be conclusive and
binding on the Borrower absent manifest error, although the failure to deliver
any such certificate shall not release or diminish any of the Borrower's
obligations to pay additional amounts pursuant to this Section 2.06 upon the
subsequent receipt thereof.
SECTION 3. FEES; COMMITMENTS.
3.01 FEES. (a) The Borrower agrees to pay to the
Administrative Agent a commitment commission ("Commitment Commission") for the
account of each Non-Defaulting Bank with a Revolving Loan Commitment for the
period from and including the Restatement Effective Date to, but not including,
the date the Total Revolving Loan Commitment has been terminated, computed at a
rate for each day equal to 1/2 of 1% per annum on the daily average of such
Bank's Unutilized Revolving Loan Commitment. Such Commitment Commission shall be
due and payable in arrears on each Quarterly Payment Date of each year and on
the date upon which the Total Revolving Loan Commitment is terminated.
(b) The Borrower agrees to pay to the Administrative Agent for
the account of each Non-Defaulting Bank PRO RATA on the basis of its Adjusted RC
Percentage, a fee in respect of each Letter of Credit (the "Letter of Credit
Fee") in an amount equal to the Eurodollar Margin then in
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effect on the daily Stated Amount of such Letter of Credit. Accrued Letter of
Credit Fees shall be due and payable quarterly in arrears on each Quarterly
Payment Date of each year and on the date upon which the Total Revolving Loan
Commitment is terminated.
(c) The Borrower agrees to pay to each Letter of Credit Issuer
for its own account a fee in respect of each Letter of Credit (the
"Facing Fee") issued by such Letter of Credit Issuer computed at the
rate equal to (A) in the case of Trade Letters of Credit, 1/4 of 1% per
annum on the daily Stated Amount of such Trade Letter of Credit,
provided, that in any event, the minimum amount of the Facing Fee
payable for each Trade Letter of Credit shall be $100 and (B) in the
case of Standby Letters of Credit, 1/4 of 1% per annum on the daily
Stated Amount of such Standby Letter of Credit, PROVIDED that, in any
event, the minimum amount of the Facing Fee payable in any 12-month
period for each Standby Letter of Credit shall be $500 (it being agreed
that, on each anniversary of the issuance of any Standby Letter of
Credit or upon any earlier termination or expiration of a Standby
Letter of Credit, if $500 exceeds the amount of Facing Fees theretofore
paid or then accrued with respect to such Standby Letter of Credit, in
either case after the date of the issuance thereof, or if later, after
the date of the last anniversary of the issuance thereof (but excluding
any amounts paid after such anniversary with respect to periods ending
on or prior to such anniversary, including, without limitation, as a
result of the operation of this parenthetical), the amount of such
excess shall be payable on the next date upon which accrued Facing Fees
are otherwise payable with respect to Standby Letters of Credit).
Accrued Facing Fees shall be due and payable quarterly in arrears on
each Quarterly Payment Date of each year and on the date upon which the
Total Revolving Loan Commitment has been terminated and such Letter of
Credit has been terminated in accordance with its terms.
(d) The Borrower agrees to pay directly to the respective
Letter of Credit Issuer upon each issuance of, payment under, and/or
amendment of, a Letter of Credit issued by such Letter of Credit such
amount as shall at the time of such issuance, payment or amendment be
the administrative charge and expenses which such Letter of Credit
Issuer is customarily charging for issuances of, payments under or
amendments of, letters of credit issued by it.
(e) The Borrower agrees to pay to the Administrative Agent
such other fees as agreed to between the Borrower and the
Administrative Agent, when and as due.
(f) All computations of Fees shall be made in accordance with
Section 12.07(b).
3.02 VOLUNTARY REDUCTION OF COMMITMENTS. (a) Upon at least
three Business Days' prior written notice (or telephonic notice confirmed in
writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks), the Borrower
shall have the right, without premium or penalty, to terminate or partially
reduce the Total Unutilized Revolving Loan Commitment, PROVIDED that (x) any
such termination shall apply to proportionately and permanently reduce the
Revolving Loan Commitment of each Bank, (y) no such reduction shall reduce any
Non-Defaulting Bank's Revolving Loan Commitment to an amount that is less than
the outstanding Revolving Loans of such Bank and (z) any partial reduction
pursuant to this Section 3.02 shall be in the amount of at least $1,000,000.
(b) In the event of certain refusals by a Bank as provided in
Section 12.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower may, subject to the
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requirements of said Section 12.12(b) and upon five Business Days' written
notice to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks), terminate
all of the Revolving Loan Commitment of such Bank so long as all Revolving
Loans, together with accrued and unpaid interest, Fees and all other amounts,
owing to such Bank are repaid concurrently with the effectiveness of such
termination (at which time Annex I shall be deemed modified to reflect such
changed amounts), and at such time such Bank shall no longer constitute a "Bank"
for purposes of this Agreement, except with respect to indemnification
provisions under this Agreement (including, without limitation, Sections 1.10,
1.11, 2.06, 4.04, 12.01 and 12.06), which shall survive as to such repaid Bank.
3.03 MANDATORY ADJUSTMENTS OF COMMITMENTS, ETC. (a) The Total
Revolving Loan Commitment (and the Revolving Loan Commitment of each Bank) shall
terminate on August 31, 1998 unless the Restatement Effective Date has occurred
on or before such date, and in the event of such termination, this Agreement
shall be of no force or effect and the Existing Credit Agreement shall continue
to be effective, as the same may have been amended, modified or supplemented
from time to time.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Revolving Loan Commitment (and the
Revolving Loan Commitment of each Bank) shall terminate on the Maturity Date.
(c) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, on each date on or after the Restatement
Effective Date on which the Borrower or any of its Subsidiaries receives Cash
Proceeds from any Asset Sale, the Total Revolving Loan Commitment shall be
permanently reduced on such date by an amount equal to 100% of the Net Cash
Proceeds from such Asset Sale, PROVIDED that up to an aggregate of $15,000,000
of Net Cash Proceeds received by the Borrower from Asset Sales shall not give
rise to a permanent reduction to the Total Revolving Loan Commitment pursuant to
this Section 3.03(c) to the extent the Borrower elects, as hereinafter provided,
to cause such Net Cash Proceeds to be reinvested in Reinvestment Assets (a
"Reinvestment Election"). The Borrower may exercise its Reinvestment Election
(within the parameters specified in the preceding sentence) with respect to an
Asset Sale if (x) no Default or Event of Default exists and (y) the Borrower
delivers a Reinvestment Notice to the Administrative Agent within 3 Business
Days following the date of the consummation of the respective Asset Sale, with
such Reinvestment Election being effective with respect to the Net Cash Proceeds
of such Asset Sale equal to the Anticipated Reinvestment Amount specified in
such Reinvestment Notice; PROVIDED, that on the Reinvestment Commitment
Reduction Date with respect to a Reinvestment Election, an amount equal to the
Reinvestment Commitment Reduction Amount, if any, for such Reinvestment Election
shall be applied to permanently reduce the Total Revolving Loan Commitment.
(d) Each reduction to the Total Revolving Loan Commitment
pursuant to this Section 3.03 shall be applied proportionately to reduce the
Revolving Loan Commitment of each Bank.
SECTION 4. PAYMENTS.
4.01 VOLUNTARY PREPAYMENTS. The Borrower shall have the right
to prepay Loans in whole or in part, without premium or penalty, from time to
time on the following terms and conditions: (i) the Borrower shall give the
Administrative Agent at the Payment Office written
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notice (or telephonic notice promptly confirmed in writing) of its intent to
prepay the Loans, whether such Loans are Revolving Loans or Swingline Loans, the
amount of such prepayment and (in the case of Eurodollar Loans) the specific
Borrowing or Borrowings pursuant to which made, which notice shall be given by
the Borrower at least one Business Day prior to the date of such prepayment with
respect to Base Rate Loans (other than Swingline Loans, with respect to which
notice may be given by the Borrower on the day of prepayment) and three Business
Days prior to the date of such prepayment with respect to Eurodollar Loans,
which notice shall promptly be transmitted by the Administrative Agent to each
of the Banks; (ii) (x) each partial prepayment of any Borrowing (other than a
Borrowing of Swingline Loans) shall be in an aggregate principal amount of at
least $500,000 and (y) each partial prepayment of any Borrowing of Swingline
Loans shall be in an aggregate principal amount of at least $50,000, PROVIDED
that no partial prepayment of Eurodollar Loans made pursuant to a Borrowing
shall reduce the aggregate principal amount of the Loans outstanding pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto; (iii) at the time of any prepayment of Eurodollar Loans pursuant to
this Section 4.01 on any date other than the last day of the Interest Period
applicable thereto, the Borrower shall pay the amounts required pursuant to
Section 1.11; (iv) in the event of certain refusals by a Bank as provided in
Section 12.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower may, upon 5 Business Days' written notice to the
Administrative Agent at its Notice Office (which notice the Administrative Agent
shall promptly transmit to each of the Banks) repay all Revolving Loans,
together with accrued and unpaid interest, Fees, and other amounts owing to such
Bank in accordance with said Section 12.12(b) so long as (A) in the case of the
repayment of Revolving Loans of any Bank pursuant to this clause (iv), the
Revolving Loan Commitment of such Bank is terminated concurrently with such
repayment (at which time Annex I shall be deemed modified to reflect the changed
Revolving Loan Commitments) and (B) the consents required by Section 12.12(b) in
connection with the repayment pursuant to this clause (iv) have been obtained;
and (v) each prepayment in respect of any Revolving Loans made pursuant to a
Borrowing shall be applied PRO RATA among such Revolving Loans, PROVIDED that at
the Borrower's election in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01, such prepayment shall not be applied to any
Revolving Loans of a Defaulting Bank.
4.02 MANDATORY PREPAYMENTS.
(a) (i) If on any date the sum of the aggregate outstanding
principal amount of Revolving Loans made by Non-Defaulting Banks, Swingline
Loans and the Letter of Credit Outstandings exceeds the Adjusted Total Revolving
Loan Commitment as then in effect, the Borrower shall repay on such date the
principal of Swingline Loans, and if no Swingline Loans are or remain
outstanding, Revolving Loans of Non-Defaulting Banks, in an aggregate amount
equal to such excess. If, after giving effect to the repayment of all
outstanding Swingline Loans and Revolving Loans of Non-Defaulting Banks, the
aggregate amount of Letter of Credit Outstandings exceeds the Adjusted Total
Revolving Loan Commitment, the Borrower shall pay to the Administrative Agent on
such date an amount in cash and/or Cash Equivalents equal to such excess (up to
the aggregate amount of the Letter of Credit Outstandings at such time) and the
Administrative Agent shall hold such payment as security for the obligations of
the Borrower hereunder pursuant to a cash collateral agreement to be entered
into in form and substance satisfactory to the Administrative Agent (which shall
permit certain investments in Cash Equivalents satisfactory to the
Administrative Agent, until the proceeds are applied to the secured
obligations).
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(ii) If on any date the aggregate outstanding principal amount
of the Revolving Loans made by a Defaulting Bank exceeds the Revolving Loan
Commitment of such Defaulting Bank, the Borrower shall repay on such date
principal of Revolving Loans of such Defaulting Bank in an amount equal to such
excess.
(b) Notwithstanding anything to the contrary contained
elsewhere in this Agreement, (i) all then outstanding Swingline Loans shall be
repaid in full on the Swingline Expiry Date, and (ii) all then outstanding
Revolving Loans shall be repaid in full on the Maturity Date.
(c) With respect to each repayment of Loans required by this
Section 4.02, the Borrower may designate the Types of Loans which are to be
repaid and, in the case of Eurodollar Loans, the specific Borrowing or
Borrowings pursuant to which made, PROVIDED that: (i) repayments of Eurodollar
Loans pursuant to this Section 4.02 may only be made on the last day of an
Interest Period applicable thereto unless all Eurodollar Loans with Interest
Periods ending on such date of required repayment and all Base Rate Loans have
been paid in full; (ii) if any prepayment of Eurodollar Loans made pursuant to a
single Borrowing shall reduce the outstanding Revolving Loans made pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount for such
Borrowing, such Borrowing shall be immediately converted into Base Rate Loans;
(iii) each prepayment of any Revolving Loans made by Non-Defaulting Banks
pursuant to a Borrowing shall be applied PRO RATA among such Revolving Loans;
and (iv) each prepayment of any Revolving Loans made by Defaulting Banks
pursuant to a Borrowing shall be applied PRO RATA among such Revolving Loans. In
the absence of a designation by the Borrower as described in the preceding
sentence, the Administrative Agent shall, subject to the above, make such
designation in its sole discretion with a view, but not obligation, to minimize
breakage costs owing under Section 1.11. Notwithstanding the foregoing
provisions of this Section 4.02(c), if at any time a mandatory or voluntary
prepayment of Revolving Loans pursuant to Section 4.01 or 4.02 would result,
after giving effect to the procedures set forth above, in the Borrower incurring
breakage costs under Section 1.11 as a result of Eurodollar Loans being prepaid
other than on the last day of an Interest Period applicable thereto (the
"Affected Eurodollar Loans"), then the Borrower may in its sole discretion
initially deposit a portion (up to 100%) of the amounts that otherwise would
have been paid in respect of the Affected Eurodollar Loans with the
Administrative Agent (which deposit must be equal in amount to the amount of the
Affected Eurodollar Loans not immediately prepaid) to be held as security for
the obligations of the Borrower hereunder pursuant to a cash collateral
arrangement satisfactory to the Administrative Agent and the Borrower and shall
provide for investments satisfactory to the Administrative Agent, with such cash
collateral to be directly applied upon the first occurrence (or occurrences)
thereafter of the last day of an Interest Period applicable to the relevant
Eurodollar Loans (or such earlier date or dates as shall be requested by the
Borrower), to repay an aggregate principal amount of such Affected Eurodollar
Loans not initially prepaid pursuant to this sentence. Notwithstanding anything
to the contrary contained in the immediately preceding sentence, all amounts
deposited as cash collateral pursuant to the immediately preceding sentence
shall be held for the sole benefit of the Banks whose Eurodollar Loans would
otherwise have been immediately prepaid with the amounts deposited and upon the
taking of any action by the Administrative Agent or the Banks pursuant to the
remedial provisions of Section 9, any amounts held as cash collateral pursuant
to this Section 4.02(c) shall, subject to the requirements of applicable law, be
immediately applied to repay such Loans.
4.03 METHOD AND PLACE OF PAYMENT. Except as otherwise
specifically provided
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herein, all payments under this Agreement shall be made to the Administrative
Agent for the ratable (based on their respective PRO RATA shares) account of the
Banks entitled thereto (which funds the Administrative Agent shall promptly
forward to such Banks), not later than 1:00 P.M. (New York time) on the date
when due and shall be made in immediately available funds and in lawful money of
the United States of America at the Payment Office, it being understood that
written notice by the Borrower to the Administrative Agent to make a payment
from the funds in the Borrower's account at the Payment Office shall constitute
the making of such payment to the extent of such funds held in such account. Any
payments under this Agreement which are made later than 1:00 P.M. (New York
time) shall be deemed to have been made on the next succeeding Business Day.
Whenever any payment to be made hereunder shall be stated to be due on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and, with respect to payments of principal, interest
shall be payable during such extension at the applicable rate in effect
immediately prior to such extension.
4.04 NET PAYMENTS. (a) All payments made by the Borrower
hereunder or under any Note will be made without setoff, counterclaim or other
defense. Except as provided in Section 4.04(b), all such payments will be made
free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction or by any political
subdivision or taxing authority thereof or therein with respect to such payments
(but excluding, except as provided in the second succeeding sentence, any tax
imposed on or measured by the net income or net profits of a Bank pursuant to
the laws of the jurisdiction in which it is organized or managed and controlled
or the jurisdiction in which the principal office or applicable lending office
of such Bank is located or any subdivision thereof or therein) and all interest,
penalties or similar liabilities with respect to such non-excluded taxes,
levies, imposts, duties, fees, assessments or other charges (all such
non-excluded taxes, levies, imposts, duties, fees, assessments or other charges
being referred to collectively as "Taxes"). If any Taxes are so levied or
imposed, the Borrower agrees to pay the full amount of such Taxes, and such
additional amounts, if any, as may be necessary so that every payment of all
amounts due under this Agreement or under any Note, after withholding or
deduction for or on account of any Taxes, will not be less than the amount
provided for herein or in such Note. If any amounts are payable in respect of
Taxes pursuant to the preceding sentence, the Borrower agrees to reimburse each
Bank, upon the written request of such Bank, for taxes imposed on or measured by
the net income or net profits of such Bank pursuant to the laws of the
jurisdiction in which such Bank is organized or in which the principal office or
applicable lending office of such Bank is located or under the laws of any
political subdivision or taxing authority of any such jurisdiction in which such
Bank is organized or in which the principal office or applicable lending office
of such Bank is located and for any withholding of income or similar taxes as
such Bank shall determine are payable by, or withheld from, such Bank in respect
of such amounts so paid to or on behalf of such Bank pursuant to the preceding
sentence and in respect of any amounts paid to or on behalf of such Bank
pursuant to this sentence. The Borrower will furnish to the Administrative Agent
within 45 days after the date the payment of any Taxes is due pursuant to
applicable law certified copies of tax receipts, or other evidence satisfactory
to such Bank, in its sole discretion, evidencing such payment by the Borrower.
The Borrower agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Taxes so levied or imposed
and paid by such Bank. All amounts payable pursuant to this Section 4.04(a)
shall be subject to the provisions of Section 12.17 (to the extent applicable).
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(b) Each Bank that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees to deliver to the Borrower and the Administrative Agent on or
prior to the Restatement Effective Date, or in the case of a Bank that is an
assignee or transferee of an interest under this Agreement pursuant to Section
1.13 or 12.04 (unless the respective Bank was already a Bank hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Bank, (i) two accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001 (or successor forms)
certifying to such Bank's entitlement to a complete exemption from United States
withholding tax with respect to payments to be made under this Agreement and
under any Note, or (ii) if the Bank is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "Section
4.04(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form) certifying to
such Bank's entitlement to a complete exemption from United States withholding
tax with respect to payments of interest to be made under this Agreement and
under any Note. In addition, each Bank agrees that from time to time after the
Restatement Effective Date, when a lapse in time or change in circumstances
renders the previous certification obsolete or inaccurate in any material
respect, it will deliver to the Borrower and the Administrative Agent two new
accurate and complete original signed copies of Internal Revenue Service Form
4224 or 1001, or Form W-8 and a Section 4.04(b)(ii) Certificate, as the case may
be, and such other forms as may be required in order to confirm or establish the
entitlement of such Bank to a continued exemption from or reduction in United
States withholding tax with respect to payments under this Agreement
and any Note, or it shall immediately notify the Borrower and the Administrative
Agent of its inability to deliver any such Form or Certificate, in which case
such Bank shall not be required to deliver any such Form or Certificate pursuant
to this Section 4.04(b). Notwithstanding anything to the contrary contained in
Section 4.04(a), but subject to Section 12.04(b) and the immediately succeeding
sentence, (x) the Borrower shall be entitled, to the extent it is required to do
so by law, to deduct or withhold income or similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, fees or other amounts payable hereunder for the account of any
Bank which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that
such Bank has not provided to the Borrower U.S. Internal Revenue Service Forms
that establish a complete exemption from such deduction or withholding and (y)
the Borrower shall not be obligated pursuant to Section 4.04(a) to gross-up
payments to be made to a Bank in respect of income or similar taxes imposed by
the United States or any additional amounts with respect thereto if (I) such
Bank is not a U.S. Person (defined as provided above) and has not provided to
the Borrower the Internal Revenue Service Forms required to be provided to the
Borrower pursuant to this Section 4.04(b) or (II) in the case of a payment,
other than interest, to a Bank described in clause (ii) above, to the extent
that such Forms do not establish a complete exemption from withholding of such
taxes. Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 4.04 and except as set forth in Section
12.04(b), the Borrower agrees to pay additional amounts and to indemnify each
Bank in the manner set forth in Section 4.04(a) (without regard to the identity
of the jurisdiction requiring the deduction or withholding) in respect of any
Taxes deducted or withheld by it as described in the immediately preceding
sentence as a result of any changes after the Restatement Effective Date in any
applicable law, treaty, governmental rule, regulation, guideline or order, or in
the interpretation thereof, relating to the deducting or withholding of such
Taxes.
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(c) If any Bank, in its sole opinion, determines that it has
finally and irrevocably received or been granted a refund in respect of any
Taxes paid as to which indemnification has been paid by the Borrower pursuant to
this Section, it shall promptly remit such refund (including any interest
received in respect thereof), net of all out-of-pocket costs and expenses, to
the Borrower; provided that the Borrower agrees to promptly return any such
refund (plus interest) to such Bank upon receipt of written notification from
such Bank in the event such Bank is required to repay such refund to the
relevant taxing authority. Nothing contained herein shall interfere with the
right of a Bank to arrange its tax affairs in whatever manner it thinks fit or
oblige any Bank to apply for any refund or to disclose to any party any
information relating to its tax affairs on any computations in respect thereof
(including, without limitation, its tax returns).
SECTION 5. CONDITIONS PRECEDENT TO THE RESTATEMENT EFFECTIVE
DATE AND TO ALL CREDIT EVENTS. The occurrence of the Restatement Effective Date
pursuant to Section 12.10, the obligation of the Banks to make each Loan
hereunder, and the obligation of the Letter of Credit Issuers to issue Letters
of Credit hereunder, are each subject, at the time thereof (except as otherwise
hereinafter indicated), to the satisfaction of each of the following conditions:
5.01 EXECUTION OF AGREEMENT. On or prior to the Restatement
Effective Date, (i) this Agreement shall have been executed and delivered as
provided in Section 12.10 and (ii) there shall have been delivered to the
Administrative Agent for the account of each Bank the appropriate Revolving Note
and, in the case of the Swingline Bank, the Swingline Note, in each case,
executed by the Borrower, and in the amount, maturity and as otherwise provided
herein.
5.02 NO DEFAULT; REPRESENTATIONS AND WARRANTIES. On the
Restatement Effective Date and at the time of each Credit Event and also after
giving effect thereto, (i) there shall exist no Default or Event of Default and
(ii) all representations and warranties contained herein and in the other Credit
Documents in effect at such time shall be true and correct in all material
respects with the same effect as though such representations and warranties had
been made on and as of the date of such Credit Event, except to the extent that
such representations and warranties expressly relate to an earlier date, in
which case such representations and warranties will be true and correct in all
material respects as of such earlier date.
5.03 OFFICER'S CERTIFICATE. On or prior to the Restatement
Effective Date, the Administrative Agent shall have received a certificate dated
such date signed by the President or any Vice President of the Borrower stating
that all of the applicable conditions set forth in Sections 5.02, 5.07, 5.08,
5.09, 5.10, 5.11, 5.12 and 5.22 exist or have been satisfied as of such date.
5.04 OPINIONS OF COUNSEL. On or prior to the Restatement
Effective Date, the Administrative Agent shall have received an opinion,
addressed to the Administrative Agent and each of the Banks and dated the
Restatement Effective Date, from ▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel to
the Borrower and each Subsidiary Guarantor, which opinion shall (i) cover the
matters contained in Exhibit E and (ii) be in form, scope and substance
satisfactory to the Administrative Agent and the Required Banks.
5.05 CORPORATE PROCEEDINGS. (a) On or prior to the Restatement
Effective Date, the Administrative Agent shall have received from each Credit
Party a certificate, dated the Restatement Effective Date, signed by the
President or any Vice-President of each such Credit Party in the form of Exhibit
F with appropriate insertions and deletions, together with copies of the
certificate of
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incorporation, the by-laws or other organizational documents of each such Credit
Party and the resolutions of each such Credit Party referred to in such
certificate and all of the foregoing shall be satisfactory to the Administrative
Agent.
(b) On or prior to the Restatement Effective Date, all
corporate and legal proceedings and all instruments and agreements in connection
with the transactions contemplated by this Agreement and the other Documents
shall be satisfactory in form and substance to the Administrative Agent, and the
Administrative Agent shall have received all information and copies of all
certificates, documents and papers, including good standing certificates and any
other records of corporate proceedings and governmental approvals, if any, which
the Administrative Agent may have reasonably requested in connection therewith,
such documents and papers, where appropriate, to be certified by proper
corporate or governmental authorities.
5.06 PLANS; EXISTING INDEBTEDNESS AGREEMENTS; SHAREHOLDERS'
AGREEMENTS; MANAGEMENT AGREEMENTS; EMPLOYMENT AGREEMENTS; COLLECTIVE BARGAINING
AGREEMENTS; TAX SHARING AGREEMENTS. On or prior to the Restatement Effective
Date, there shall have been delivered to the Administrative Agent copies,
certified as true and correct by an appropriate officer of the Borrower of:
(i) all Plans (and for each Plan that is required to file an
annual report on Internal Revenue Service Form 5500-series, a copy of
the most recent such report (including, to the extent required, the
related financial and actuarial statements and opinions and other
supporting statements, certifications, schedules and information), and
for each Plan that is a "single-employer plan," as defined in Section
4001(a)(15) of ERISA, the most recently prepared actuarial valuation
therefor) and any other "employee benefit plans," as defined in Section
3(3) of ERISA, and any other material agreements, plans or
arrangements, with or for the benefit of current or former employees of
the Borrower or any Subsidiary of the Borrower or any ERISA Affiliate
(provided that the foregoing shall apply in the case of any
multiemployer plan, as defined in Section 4001(a)(3) of ERISA, only to
the extent that any document described therein is in the possession of
the Borrower or any Subsidiary of the Borrower or any ERISA Affiliate
or reasonably available thereto from the sponsor or trustee of any such
plan);
(ii) all agreements evidencing or relating to Existing
Indebtedness (the "Existing Indebtedness Agreements");
(iii) all agreements entered into by the Borrower or any of its
Subsidiaries (after giving effect to the Transaction) governing the
terms and relative rights of its capital stock, and any agreements
entered into by members or shareholders relating to any such entity
with respect to their capital stock (including, without limitation, the
GEO Shareholders' Agreement) (collectively, the "Shareholders'
Agreements");
(iv) any material agreement with members of, or with respect to,
the management of the Borrower or any of its Subsidiaries
(collectively, the "Management Agreements");
(v) any material employment agreements entered into by the
Borrower or any of its Subsidiaries (collectively, the "Employment
Agreements");
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(vi) all collective bargaining agreements applying or relating
to any employee of the Borrower or any of its Subsidiaries
(collectively, the "Collective Bargaining Agreements"); and
(vii) all tax sharing, tax allocation and other similar
agreements entered into by the Borrower or any of its Subsidiaries
(collectively, the "Tax Sharing Agreements");
all of which Plans, Existing Indebtedness Agreements, Shareholders'
Agreements, Management Agreements, Employment Agreements, Collective
Bargaining Agreements and Tax Sharing Agreements shall be in form and
substance satisfactory to the Administrative Agent.
5.07 ADVERSE CHANGE, ETC. On the Restatement Effective Date,
nothing shall have occurred (and neither the Banks nor the Administrative Agent
shall have become aware of any facts or conditions not previously known) which
the Administrative Agent or the Required Banks shall determine (i) has, or is
reasonably likely to have, a material adverse effect on the rights or remedies
of the Banks or the Administrative Agent, or on the ability of the Credit
Parties to perform their obligations to them, or (ii) has, or is reasonably
likely to have, a Material Adverse Effect.
5.08 LITIGATION. On the Restatement Effective Date, there
shall be no actions, suits or proceedings pending or threatened, to the
Borrower's knowledge, (a) with respect to this Agreement or any other Document
or the Transaction or any part thereof or any other transaction contemplated
hereby or thereby) or (b) which the Administrative Agent or the Required Banks
shall determine could reasonably be expected to (i) have a Material Adverse
Effect or (ii) have a material adverse effect on the rights or remedies of the
Banks hereunder or under any other Credit Document or on the ability of any
Credit Party to perform its respective obligations to the Banks hereunder or
under any other Credit Document.
5.09 APPROVALS. On or prior to the Restatement Effective Date,
all material and necessary governmental and third party approvals in connection
with the transactions contemplated by the Documents and otherwise referred to
herein or therein shall have been obtained and remain in effect, and all
applicable waiting periods shall have expired without any action being taken by
any competent authority which restrains or prevents such transactions or
imposes, in the reasonable judgment of the Required Banks or the Administrative
Agent, materially adverse conditions upon the consummation of such transactions.
Additionally, there shall not exist any judgment, order, injunction or other
restraint prohibiting or imposing materially adverse conditions upon the
Transaction or any other transactions contemplated by this Agreement or any
other Document.
5.10 CONSUMMATION OF THE ACQUISITION. On or prior to the
Restatement Effective Date, there shall have been delivered to the Banks a true
and correct copy of the Acquisition Agreement and the other Acquisition
Documents, and all terms of the Acquisition Agreement and the other Acquisition
Documents shall be satisfactory in form and substance to the Administrative
Agent and the Required Banks. The Acquisition Agreement (and the transactions
contemplated thereby) shall have been duly approved by the board of directors
and (if required by applicable law) the stockholders of the Borrower, and all
Acquisition Documents shall have been duly executed and delivered by the parties
thereto and shall be in full force and effect. Each of the conditions precedent
to the obligation of the parties to consummate the Acquisition as set forth in
the Acquisition Documents shall have been satisfied, or waived, all to the
satisfaction of the Administrative Agent, and concurrently with the issuance of
the Senior Subordinated Notes and the making of Revolving
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Loans on the Restatement Effective Date, the Acquisition shall have been
consummated in accordance with the Acquisition Documents and all applicable
laws, rules and regulations.
5.11 SENIOR SUBORDINATED NOTES. On or prior to the Restatement
Effective Date, (i) the Borrower shall have issued the Senior Subordinated Notes
and shall have received gross cash proceeds therefrom in an aggregate amount of
at least $120,000,000, (ii) the Administrative Agent and the Banks shall have
received copies of the Senior Subordinated Notes Documents certified as true and
correct by an Authorized Officer of the Borrower and (iii) the Senior
Subordinated Notes Documents shall be in full force and effect and the terms and
conditions thereof (including, without limitation, subordination provisions,
amortization, maturities, interest rates, covenants, defaults, securities,
remedies, mandatory repayments and offers to purchase, sinking fund provisions)
shall be reasonably satisfactory to the Administrative Agent and the Required
Banks. The Borrower shall have utilized the net cash proceeds received from the
issuance of the Senior Subordinated Notes to make the payments described under
the "Use of Proceeds" section of the offering memorandum relating to the Senior
Subordinated Notes, including the repayment of all outstanding Existing Loans
together with all accrued and unpaid interest in respect thereof and all Fees
(as defined in the Existing Credit Agreement) and all other Obligations (as
defined in the Existing Credit Agreement) then due and owing. The issuance of
the Senior Subordinated Notes shall have occurred in accordance with the terms
and conditions of the Senior Subordinated Notes Documents (without giving effect
to any material amendment, modification or waiver with respect thereto unless
consented to by the Administrative Agent and the Required Banks) and all
applicable law.
5.12 EQUITY FINANCING. On or prior to the Restatement
Effective Date (i) the Borrower shall have received at least $6,000,000 of cash
proceeds from new common equity financing provided by Charter Oak, its
affiliates, managers and other investors reasonably satisfactory to the
Administrative Agent (the "Equity Financing"), (ii) the Administrative Agent and
each Bank shall have received copies of, and the Administrative Agent and the
Required Banks shall be reasonably satisfied with, all agreements governing, or
relating to, the Equity Financing (the "Equity Financing Documents") which shall
be certified as true and correct by an Authorized Officer of the Borrower and
such Equity Financing Documents shall be in full force and effect and (iii) all
terms and conditions of the Equity Financing shall be reasonably satisfactory to
the Administrative Agent and the Required Banks. The Equity Financing shall have
occurred in accordance with the terms and conditions of the Equity Financing
Documents (without giving effect to any material amendment, modification or
waiver with respect thereto unless consented to by the Administrative Agent and
the Required Bank) and all applicable law. The Borrower shall have utilized the
cash proceeds of the Equity Financing to finance, in part, the Acquisition as
well as to pay fees and expenses in connection with the Transaction and the
Administrative Agent and the Banks shall have received a certificate of an
Authorized Officer of the Borrower to such effect setting forth in reasonable
detail the use of such proceeds.
5.13 SUBSIDIARY GUARANTY. To the extent any Subsidiary
Guarantors exist on the Restatement Effective Date, each such Subsidiary
Guarantor shall have duly authorized, executed and delivered a Subsidiary
Guaranty on such date.
5.14 SECURITY DOCUMENTS ACKNOWLEDGMENT. (a) On the Restatement
Effective Date, the Borrower shall have duly authorized, executed and delivered
an acknowledgment in the form of Exhibit H (such acknowledgment, as amended,
modified or supplemented from time to time, the
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"Security Documents Acknowledgment") pursuant to which, among other things, (i)
the Borrower shall acknowledge and agree that the "Obligations" (as defined in
each of such Security Documents) or any similar term include all of the
Obligations under this Agreement after giving effect to the Transaction and (ii)
the Borrower shall acknowledge and agree that, after giving effect to the
Transaction, each of the Pledge Agreement and the Security Agreement, shall
remain in full force and effect in accordance with their respective terms and
the Borrower shall have taken all actions reasonably requested by the
Administrative Agent (including, without limitation, the obtaining of UCC-11's
or equivalent reports and the filing of UCC-1's or UCC-3's) in connection with
the perfection and first priority status of the Liens intended to be created
and/or maintained by the Pledge Agreement and the Security Agreement in the
Pledge Agreement Collateral and the Security Agreement Collateral.
(b) On the Restatement Effective Date,
(i) the Banks shall have received evidence that the completion
of all recordings and filings necessary or, in the reasonable opinion
of the Collateral Agent, desirable to perfect and protect the security
interests purported to be created by the Security Agreement have been
taken;
(ii) the Collateral Agent shall have in its possession all of
the Pledged Securities which shall be either endorsed in blank (in the
case of promissory notes constituting Pledged Securities) or
accompanied by executed and undated stock powers (in the case of
capital stock constituting Pledged Securities); and
(iii) the Banks shall have received evidence that all other
actions necessary or, in the reasonable opinion of the Collateral
Agent, desirable to perfect and protect the first priority Lien in the
Pledge Agreement Collateral and the Security Agreement Collateral,
subject only to Permitted Encumbrances, have been taken, or
arrangements therefor have been made on a basis satisfactory to the
Collateral Agent and shall be in place.
5.15 NEW MORTGAGES. On the Restatement Effective Date, the
Borrower will, or will cause its Subsidiaries to, deliver to the Collateral
Agent (i) fully executed counterparts of deeds of trust, mortgages and similar
documents in each case in form and substance satisfactory to the Collateral
Agent (each a "New Mortgage" and, collectively, the "New Mortgages") covering
all of the Mortgaged Properties listed on Part A of Annex VIII and designated as
"New Mortgaged Properties" thereon (each a "New Mortgaged Property" and,
collectively, the "New Mortgaged Properties"), and counterparts of such New
Mortgages shall have been duly recorded or delivered to the Collateral Agent for
recording in all places to the extent necessary or, in the reasonable judgment
of the Collateral Agent, desirable, effectively to create a valid and
enforceable first priority mortgage Lien, subject only to Permitted
Encumbrances, on each such New Mortgaged Property in favor of the Collateral
Agent (or such other trustee as may be required or desirable under local law)
for the benefit of the Administrative Agent and the Banks, (ii) mortgage title
insurance policies issued by title insurers reasonably satisfactory to the
Collateral Agent (the "New Mortgage Policies") in amounts reasonably
satisfactory to the Collateral Agent and assuring the Collateral Agent that the
New Mortgages in respect of the New Mortgaged Properties are valid and
enforceable first priority mortgage Liens on the respective New Mortgaged
Properties free and clear of all defects and encumbrances except Permitted
Encumbrances, and such New Mortgage Policies shall be in form
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and substance reasonably satisfactory to the Collateral Agent and shall include
an endorsement for mechanic liens and for any other matter that the Collateral
Agent in its discretion may reasonably request and (iii) such opinions of
counsel as the Collateral Agent may reasonably request in connection with such
New Mortgages, which opinions of counsel shall be in form and substance
satisfactory to the Collateral Agent.
5.16 MORTGAGE AMENDMENTS; TITLE INSURANCE ENDORSEMENTS. (a) On
the Restatement Effective Date, the Collateral Agent shall have received:
(i) fully executed counterparts of amendments (the "Existing
Mortgage Amendments") to the mortgages delivered pursuant to the
Existing Credit Agreement (the "Existing Mortgages") in form and
substance reasonably satisfactory to the Collateral Agent, which
Existing Mortgages, as amended, shall cover such of the Real Property
owned by the applicable Credit Party as shall be listed in Part B of
Annex VIII and designated thereon as the "Existing Mortgaged
Properties" (each an "Existing Mortgaged Property" and collectively,
the "Existing Mortgaged Properties"), together with evidence that
counterparts of the Existing Mortgage Amendments have been delivered to
the title insurance company insuring the Liens of the Existing
Mortgages for recording in all places to the extent necessary or
desirable, in the reasonable judgment of the Collateral Agent,
effectively to maintain valid and enforceable first priority mortgage
liens on the Existing Mortgaged Properties) for the benefit of the
Secured Creditors (as therein defined); and
(ii) endorsements of the Existing Mortgage Policies (the
"Endorsements") in a form and in amounts reasonably satisfactory to the
Administrative Agent and the Required Banks, assuring the Collateral
Agent that the Existing Mortgages, as amended by the Existing Mortgage
Amendments, are valid and enforceable first priority mortgage liens on
the Existing Mortgaged Properties, free and clear of all defects,
encumbrances and other Liens except Permitted Encumbrances, and such
Endorsements shall be in form and substance reasonably satisfactory to
the Administrative Agent and the Required Banks.
(b) On the Restatement Effective Date, (i) the Existing
Mortgages shall remain in full force and effect, and (ii) no filings,
recordings, registrations or other actions (other than those made, obtained or
taken on or prior to the Restatement Effective Date referred to in the preceding
clause (a)) shall be necessary or, in the opinion of the Collateral Agent,
desirable to maintain the perfection and priority of the mortgage liens on the
Existing Mortgaged Properties granted pursuant to the Existing Mortgages.
5.17 SOLVENCY. On the Restatement Effective Date, the Borrower
shall have delivered to the Administrative Agent a solvency certificate in
respect of the Borrower and its Subsidiaries from the Chief Financial Officer of
the Borrower which shall be addressed to the Administrative Agent and each of
the Banks and dated the Restatement Effective Date, setting forth the conclusion
that, after giving effect to the Transaction, each of the Borrower and the
Borrower and its Subsidiaries taken as a whole, are not insolvent and will not
be rendered insolvent by the indebtedness incurred in connection therewith, and
will not be left with unreasonably small capital with which to engage in their
businesses and will not have incurred debts beyond their ability to pay debts as
they mature.
5.18 INSURANCE POLICIES. On or prior to the Restatement
Effective Date, the Collateral
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Agent shall have received evidence of insurance complying with the requirements
of Section 7.03 for the business and properties of the Borrower and its
Subsidiaries, in form and substance satisfactory to the Administrative Agent
and, naming the Collateral Agent as an additional insured and/or loss payee, as
the case may be, and stating that such insurance shall not be cancelled or
revised without 30 days' prior written notice by the insurer to the Collateral
Agent.
5.19 FEES. On or prior to the Restatement Effective Date, the
Borrower shall have paid to the Administrative Agent and the Banks all Fees and
expenses (including, without limitation, reasonable fees and expenses of
counsel) agreed upon by such parties to be paid on or prior to such date.
5.20 NOTICE OF BORROWING; LETTER OF CREDIT REQUEST. (a) Prior
to the making of each Loan (excluding Swingline Loans), the Administrative Agent
shall have received a Notice of Borrowing meeting the requirements of Section
1.03(a). Prior to the making of any Swingline Loan, the Swingline Bank shall
have received a Notice of Borrowing meeting the requirements of Section
1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the
respective Letter of Credit Issuer shall have received a Letter of Credit
Request meeting the requirements of Section 2.03.
5.21 PROJECTIONS. On or prior to the Restatement Effective
Date, there shall have been delivered to the Administrative Agent detailed
projected consolidated financial statements of the Borrower and its Subsidiaries
certified by the chief financial officer of the Borrower for the period from
January 1, 1998 to December 31, 2004 (the "Projections"), which Projections (x)
shall reflect the forecasted consolidated income statements, balance sheets and
cash flow (including all relevant assumptions in connection therewith) of the
Borrower and its Subsidiaries after giving effect to the Transaction and (y)
shall be satisfactory (including, with respect to the accounting practices and
procedures to be utilized by the Borrower and its Subsidiaries following the
Transaction) in form and substance to the Administrative Agent.
5.22 REPAYMENT OF EXISTING LOANS AND OTHER OBLIGATIONS UNDER
EXISTING CREDIT AGREEMENT; EXISTING INDEBTEDNESS. (a) On or prior to the
Restatement Effective Date, the Borrower shall have repaid in full in cash all
outstanding Existing Loans (together with all interest in respect thereof
accrued through the Restatement Effective Date) and all other outstanding
Obligations (as defined in the Existing Credit Agreement) to the extent then due
in accordance with the terms of the Existing Credit Agreement (the
"Refinancing").
(b) On the Restatement Effective Date and after giving effect
to the Transaction, neither the Borrower nor any of its Subsidiaries shall have
any preferred stock or Indebtedness outstanding except for (i) the Loans, (ii)
the Letters of Credit, (iii) the Senior Subordinated Notes and (iv) the Existing
Indebtedness.
5.23 ENVIRONMENTAL REPORTS. On or prior to the Restatement
Effective Date, there shall have been delivered to the Administrative Agent
environmental and hazardous substance analyses with respect to the properties of
the Borrower acquired (or to be acquired) in connection with Acquisition, the
results of which shall be in scope, and in form and substance satisfactory to
the Administrative Agent.
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The acceptance of the benefits of each Credit Event shall
constitute a representation and warranty by the Borrower to the Administrative
Agent and each of the Banks that all of the applicable conditions specified
above exist as of that time. All of the certificates, legal opinions and other
documents and papers referred to in this Section 5, unless otherwise specified,
shall be delivered to the Administrative Agent at its Notice Office for the
account of each of the Banks and, except for the Notes, in sufficient
counterparts or copies for each of the Banks and shall be satisfactory in form
and substance to the Administrative Agent.
SECTION 6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. In
order to induce the Banks to enter into this Agreement and to make the Loans and
issue and/or participate in Letters of Credit provided for herein, the Borrower
makes the following representations and warranties to, and agreements with, the
Banks, in each case after giving effect to the Transaction, all of which shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance and/or participation in Letters of Credit (with the making of
each Credit Event thereafter being deemed to constitute a representation and
warranty that the matters specified in this Section 6 are true and correct in
all material respects on and as of the date of each such Credit Event unless
such representation and warranty expressly indicates that it is being made as of
any specific date, in which case such representation and warranty shall be true
and correct in all material respects as of such specific date):
6.01 CORPORATE STATUS. Each of the Borrower and each of its
Subsidiaries (i) is a duly organized and validly existing corporation in good
standing under the laws of the jurisdiction of its organization and has the
corporate power and authority to own its property and assets and to transact the
business in which it is engaged and (ii) has duly qualified and is authorized to
do business and is in good standing in all jurisdictions where it is required to
be so qualified and where the failure to be so qualified could reasonably be
expected to have a Material Adverse Effect.
6.02 CORPORATE POWER AND AUTHORITY. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of the
Documents to which it is a party. Each Credit Party has duly executed and
delivered each Document to which it is a party and each such Document
constitutes the legal, valid and binding obligation of such Credit Party
enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors' rights
and by equitable principles (regardless of whether enforcement is sought in
equity or at law).
6.03 NO VIOLATION. Neither the execution, delivery and/or
performance by any Credit Party of the Documents to which it is a party nor
compliance by it with the terms and provisions thereof, nor the consummation of
the transactions contemplated therein, (i) will contravene any applicable
provision of any law, statute, rule, regulation, order, writ, injunction or
decree of any court or governmental instrumentality having jurisdiction over it,
(ii) will conflict or be inconsistent with, or result in any breach of, any of
the terms, covenants, conditions or provisions of, or constitute a default
under, or (other than pursuant to the Security Documents) result in the creation
or imposition of (or the obligation to create or impose) any Lien upon any of
the property or assets of the Borrower or any of its Subsidiaries pursuant to
the terms of, any material indenture, mortgage, deed of trust, agreement or
other instrument to which the Borrower or any of its Subsidiaries is a
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party or by which it or any of its material property or assets are bound or to
which it may be subject or (iii) will violate any provision of the certificate
of incorporation or by-laws (or equivalent organizational documents) of the
Borrower or any of its Subsidiaries.
6.04 LITIGATION. There are no actions, suits or proceedings
pending or, to the Borrower's knowledge, threatened with respect to the Borrower
or any of its Subsidiaries (i) that are likely to have a Material Adverse Effect
or (ii) that could reasonably be expected to have a material adverse effect on
(a) the rights or remedies of the Banks or on the ability of any Credit Party to
perform its obligations to them hereunder or under the other Credit Documents to
which it is a party or (b) the ability to consummate the Transaction.
6.05 USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of
all Revolving Loans may be used (i) in amounts of up to $5,000,000 on the
Restatement Effective Date to effect the Transaction and to pay fees and
expenses relating to the Transaction and (ii) for the general corporate and
working capital purposes of the Borrower and its Subsidiaries (including,
without limitation, for Permitted Acquisitions).
(b) The proceeds of all Swingline Loans shall be utilized for
the general corporate and working capital purposes of the Borrower and its
Subsidiaries (including, without limitation, for Permitted Acquisitions).
(c) Neither the making of any Loan hereunder, nor the use of
the proceeds thereof, will violate or be inconsistent with the provisions of
Regulation T, U or X of the Board of Governors of the Federal Reserve System and
no part of the proceeds of any Loan will be used to purchase or carry any Margin
Stock or to extend credit for the purpose of purchasing or carrying any Margin
Stock.
6.06 GOVERNMENTAL APPROVALS. Except for filings and recordings
in connection with the Security Documents that have been or will be made, no
material order, consent, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, is
required to authorize or is required in connection with (i) the execution,
delivery and performance of any Document or (ii) the legality, validity, binding
effect or enforceability of any Document.
6.07 INVESTMENT COMPANY ACT. Neither the Borrower nor any of
its Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
6.08 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," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
6.09 TRUE AND COMPLETE DISCLOSURE. All factual information
(taken as a whole) heretofore or contemporaneously furnished by or on behalf of
the Borrower or any of its Subsidiaries in writing to the Administrative Agent
or any Bank for purposes of or in connection with this Agreement or any
transaction contemplated herein is true and accurate in all material respects on
the date as of which such information is dated or certified and not incomplete
by omitting to state any
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material fact necessary to make such information (taken as a whole) not
misleading at such time in light of the circumstances under which such
information was provided. There is no fact known to the Borrower which would be
reasonably likely to have a Material Adverse Effect which has not been disclosed
herein or in such other documents, certificates and statements furnished to the
Banks for use in connection with the transactions contemplated hereby.
6.10 FINANCIAL CONDITION; FINANCIAL STATEMENTS. (a) On and as
of the Restatement Effective Date, on a PRO FORMA basis after giving effect to
the Transaction and to all Indebtedness incurred, and to be incurred, and Liens
created, and to be created, by each Credit Party in connection therewith, (x)
the sum of the assets, at a fair valuation, of the Borrower and its Subsidiaries
taken as a whole will exceed its debts, (y) the Borrower and its Subsidiaries
taken as a whole will not have incurred or intended to, or believe that they
will, incur debts beyond their ability to pay such debts as such debts mature
and (z) the Borrower and its Subsidiaries taken as a whole will not have
unreasonably small capital with which to conduct their businesses. For purposes
of this Section 6.10(a), "debt" means any liability on a claim, and "claim"
means (i) right to payment whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured or (ii) right to an equitable
remedy for breach of performance if such breach gives rise to a payment, whether
or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured or unsecured.
(b) (i) The consolidated balance sheets of the Borrower as of
December 31, 1996 and December 31, 1997 and the related consolidated statements
of income and cash flows of the Borrower for the fiscal years ended as of said
dates, which have been audited by ▇▇▇▇▇, ▇▇▇▇▇▇ and Company, LLP, independent
certified public accountants, who delivered unqualified audit opinions in
respect therewith and (ii) the PRO FORMA balance sheet and the related
statements of income and cash flows of the Borrower, combined to take into
account the Acquired Business, as of March 31, 1998 and the related consolidated
statements of income and cash flows of the Borrower for the twelve-month period
ended as of said date, which have been reviewed by ▇▇▇▇▇, ▇▇▇▇▇▇ and Company LLP
and prepared on a PRO FORMA basis as if the Transaction had occurred on the
first day of such period, present fairly the consolidated financial position of
the Borrower at the dates of said statements and the results for the period
covered thereby (or, in the case of the PRO FORMA balance sheet described in
clause (ii) of this paragraph (b), present a good faith estimate of the PRO
FORMA financial condition of the Borrower (after giving effect to the
Transaction) at the date thereof in accordance with GAAP (except, in the case of
the PRO FORMA balance sheet described in clause (ii) of this paragraph (b), to
the extent provided therein), except to the extent provided in the notes to said
financial statements and, in the case of the PRO FORMA balance sheet as of March
31, 1998, subject to normal year end adjustments. All such financial statements
(other than the PRO FORMA balance sheet described in clause (ii) of this
paragraph (b)) have been prepared in accordance with GAAP consistently applied
except to the extent provided in the notes to said financial statements.
(c) Since December 31, 1997, and after giving effect to the
Transaction, nothing has occurred that has had or could reasonably be expected
to have a Material Adverse Effect.
(d) The Projections and PRO FORMA financial information
contained in such materials are based on good faith estimates and assumptions
believed by such Persons to be reasonable at the time made, it being recognized
by the Banks that such Projections as to future events and PRO FORMA
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adjustments are not to be viewed as facts and that actual results during the
period or periods covered by any such projections may differ from the projected
results or PRO FORMA adjustments and that such differences may be material. On
the Restatement Effective Date, the Borrower believed that the Projections were
reasonable and attainable.
(e) Except as reflected in the financial statements and the
notes thereto described in Section 6.10(b), as of the Restatement Effective Date
there were no liabilities or obligations with respect to the Borrower or any of
its Subsidiaries of a nature (whether absolute, accrued, contingent or otherwise
and whether or not due) which, either individually or in aggregate, would be
material to the Borrower and its Subsidiaries taken as a whole.
6.11 SECURITY INTERESTS. On and after the Restatement
Effective Date, each of the Security Documents create, as security for the
Obligations purported to be secured thereby, a valid and enforceable perfected
security interest in and Lien on all of the Collateral subject thereto, superior
to and prior to the rights of all third Persons and subject to no other Liens
(except (x) to the extent expressly set forth in the Security Documents, (y)
that the Collateral may be subject to the security interests evidenced by
Permitted Liens relating thereto and (z) that the Mortgaged Properties also may
be subject to Permitted Encumbrances relating thereto), in favor of the
Collateral Agent. No filings or recordings are required in order to perfect the
security interests created under any Security Document except for filings or
recordings required in connection with any such Security Document (other than
the Pledge Agreement) which shall have been made prior to the date hereof (or
are the subject of arrangements, satisfactory to the Administrative Agent, for
filing on or promptly after the date hereof).
6.12 REPRESENTATIONS AND WARRANTIES IN DOCUMENTS. All
representations and warranties of the Credit Parties and, to the best knowledge
of the Borrower, of all other Persons party thereto (except as taken into
account in the financial information described in Section 6.10), set forth in
the Documents were true and correct in all material respects as of the time such
representations and warranties were made and shall be true and correct in all
material respects as of the Restatement Effective Date as if such
representations and warranties were made on and as of such date, unless stated
to relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date.
6.13 CONSUMMATION OF TRANSACTION. As of the Restatement
Effective Date, the Transaction shall have been consummated in accordance with
the terms and conditions of the Transaction Documents and all applicable laws.
All applicable waiting periods with respect thereto have or, prior to the time
when required, will have, expired without, in all such cases, any action being
taken by any competent authority which restrains, prevents, or imposes material
adverse conditions upon the consummation of the Transaction. As of the
Restatement Effective Date, there does not exist any judgment, order, or
injunction prohibiting the consummation of the Transaction, or the making of the
Loans or the performance by any Credit Party of its respective obligations under
the Documents.
6.14 TAX RETURNS AND PAYMENTS. Each of the Borrower and each
of its Subsidiaries has filed all federal income tax returns and all other
material tax returns, domestic and foreign, required to be filed by it and has
paid, all material taxes and assessments payable by it which have become due,
other than those contested in good faith and adequately disclosed and fully
provided
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for on the financial statements of the Borrower and its Subsidiaries in
accordance with GAAP. The Borrower and each of its Subsidiaries have paid, or
have provided adequate reserves (in the good faith judgment of the management of
the Borrower) for the payment of, all federal, state and foreign income taxes
applicable for all prior fiscal years and for the current fiscal year to date.
There is no material action, suit, proceeding, investigation, audit or claim now
pending or, to the knowledge of the Borrower or any of its Subsidiaries,
threatened by any authority regarding any taxes relating to the Borrower or any
of its Subsidiaries. Neither the Borrower nor any of its Subsidiaries has
entered into an agreement or waiver or been requested to enter into an agreement
or waiver extending any statute of limitations relating to the payment or
collection of taxes of the Borrower or any of its Subsidiaries, or is aware of
any circumstances that would cause the taxable years or other taxable periods of
the Borrower or any of its Subsidiaries not to be subject to the normally
applicable statute of limitations.
6.15 COMPLIANCE WITH ERISA. Annex IV sets forth each Plan;
each Plan (and each related trust, insurance contract or fund) is in substantial
compliance with its terms and with all applicable laws, including without
limitation ERISA and the Code; each Plan (and each related trust, if any) which
is intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect that it
meets the requirements of Sections 401(a) and 501(a) of the Code; no Reportable
Event has occurred; no Plan which is a multiemployer plan (as defined in Section
4001(a)(3) of ERISA) is insolvent or in reorganization; no Plan has an Unfunded
Current Liability; no Plan which is subject to Section 412 of the Code or
Section 302 of ERISA has an accumulated funding deficiency, within the meaning
of such sections of the Code or ERISA, or has applied for or received a waiver
of an accumulated funding deficiency or an extension of any amortization period,
within the meaning of Section 412 of the Code or Section 303 or 304 of ERISA;
all contributions required to be made with respect to a Plan have been timely
made; neither the Borrower nor any Subsidiary of the Borrower nor any ERISA
Affiliate has incurred any material liability (including any indirect,
contingent or secondary liability) to or on account of a Plan pursuant to
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 401(a)(29), 4971 or 4975 of the Code or expects to incur any
such liability under any of the foregoing sections with respect to any Plan; no
condition exists which presents a material risk to the Borrower or any
Subsidiary of the Borrower or any ERISA Affiliate of incurring a liability to or
on account of a Plan pursuant to the foregoing provisions of ERISA and the Code;
no proceedings have been instituted to terminate or appoint a trustee to
administer any Plan which is subject to Title IV of ERISA; no action, suit,
proceeding, hearing, audit or investigation with respect to the administration,
operation or the investment of assets of any Plan (other than routine claims for
benefits) is pending, expected or threatened; using actuarial assumptions and
computation methods consistent with Part 1 of subtitle E of Title IV of ERISA,
the aggregate liabilities of the Borrower and its Subsidiaries and its ERISA
Affiliates to all Plans which are multiemployer plans (as defined in Section
4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as of the
close of the most recent fiscal year of each such Plan ended prior to the date
of the most recent Credit Event, would not exceed $50,000; each group health
plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code)
of the Borrower or any Subsidiary or any ERISA Affiliate which covers or has
covered employees or former employees of the Borrower, any Subsidiary of the
Borrower, or any ERISA Affiliate has at all times been operated in compliance
with the provisions of Part 6 of subtitle B of Title I of ERISA and Section
4980B of the Code; no lien imposed under the Code or ERISA on the assets of the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate exists or is
likely to arise on account of any Plan; and the
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Borrower and its Subsidiaries may cease contributions to or terminate any
employee benefit plan maintained by any of them without incurring any material
liability.
6.16 SUBSIDIARIES; SUBSIDIARY RESTRICTIONS. (a) Annex V lists
each Subsidiary of the Borrower (and the direct and indirect ownership interest
of the Borrower therein), in each case existing on the Restatement Effective
Date.
(b) There are no restrictions on the Borrower or any of its
Subsidiaries which prohibit or otherwise restrict the transfer of cash or other
assets from any Subsidiary of the Borrower to the Borrower, other than
prohibitions or restrictions existing under or by reason of (i) this Agreement
and the other Credit Documents, (ii) applicable law, (iii) customary
non-assignment provisions entered into in the ordinary course of business and
consistent with past practices, (iv) any restriction or encumbrance with respect
to a Subsidiary of the Borrower imposed pursuant to an agreement which has been
entered into for the sale or disposition of all or substantially all of the
capital stock or assets of such Subsidiary, so long as such sale or disposition
is permitted under this Agreement, and (v) any documents or instruments
governing the terms of any Indebtedness or other obligations secured by
Permitted Liens, PROVIDED that such prohibitions or restrictions apply only to
the assets subject to such Permitted Liens.
6.17 PATENTS, ETC. Except as set forth on Annex VI, the
Borrower and each of its Subsidiaries has the right to use all material patents,
trademarks, service marks, trade names, copyrights and licenses, free from
materially burdensome restrictions, that are used for the operation of their
businesses taken as a whole as presently conducted.
6.18 POLLUTION AND OTHER REGULATIONS. (a) The Borrower and
each of its Subsidiaries is in compliance with all applicable Environmental Laws
governing its business for which failure to comply is likely to have a Material
Adverse Effect, and neither the Borrower nor any of its Subsidiaries is liable
for any material penalties, fines or forfeitures for failure to comply with any
of the foregoing in the manner set forth above. Except as set forth on Annex
VII, all licenses, permits, registrations or approvals required for the business
of the Borrower and each of its Subsidiaries, as conducted as of the Restatement
Effective Date, under any Environmental Law have been secured and each of the
Borrower and each of its Subsidiaries is in substantial compliance therewith,
except such licenses, permits, registrations or approvals the failure to secure
or to comply therewith is not likely to have a Material Adverse Effect. Neither
the Borrower nor any of its Subsidiaries is in any respect in noncompliance
with, breach of or default under any applicable writ, order, judgment,
injunction, or decree to which the Borrower or such Subsidiary is a party or
which would affect the ability of the Borrower or such Subsidiary to conduct its
business and no event has occurred and is continuing which, with the passage of
time or the giving of notice or both, would constitute noncompliance, breach of
or default thereunder, except in each such case, such noncompliance, breaches or
defaults as are not likely to, in the aggregate, have a Material Adverse Effect.
Except as set forth in Annex VII, there are as of the Restatement Effective Date
no Environmental Claims pending or, to the best knowledge of the Borrower,
threatened, against the Borrower or any of its Subsidiaries, or which (a)
question the validity, term or entitlement of the Borrower or any of its
Subsidiaries for any permit, license, order or registration required for the
operation of any facility which the Borrower or any of its Subsidiaries
currently operates and (b) wherein an unfavorable decision, ruling or finding
would be reasonably likely to have a Material Adverse Effect. There are no
facts, circumstances, conditions or occurrences on any Real Property at any time
owned
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or operated by the Borrower or any of its Subsidiaries or, to the knowledge of
the Borrower, on any property adjacent to any such Real Property that could
reasonably be expected (i) to form the basis of an Environmental Claim against
the Borrower, any of its Subsidiaries or any currently owned or operated Real
Property of the Borrower or any of its Subsidiaries, or (ii) (a) to cause any
such Real Property currently owned or operated to be subject to any restrictions
on the occupancy or use of such Real Property under any Environmental Law or (b)
to cause any such owned Real Property to be subject to any restrictions on the
ownership or transferability of such owned Real Property under any Environmental
Law, except in each such case, such Environmental Claims or restrictions that
individually or in the aggregate are not reasonably likely to have a Material
Adverse Effect.
(b) Hazardous Materials have not at any time been (i)
generated, used, treated or stored on, or transported to or from, any Real
Property of the Borrower or any of its Subsidiaries or (ii) released on any such
Real Property, in each case under clauses (i) and (ii) where such occurrence or
event individually or in the aggregate is reasonably likely to have a Material
Adverse Effect.
6.19 PROPERTIES. The Borrower and each of its Subsidiaries
have good title to all material properties owned by them, free and clear of all
Liens, other than (i) as referred to in the consolidated balance sheet referred
to in Section 6.10(b) or in the notes thereto or (ii) Permitted Liens. Annex
VIII contains a true and complete list of each Real Property owned or leased by
the Borrower or any of its Subsidiaries on the Restatement Effective Date and
the type of interest therein held by the Borrower or the respective Subsidiary.
6.20 LABOR RELATIONS. Neither the Borrower nor any of its
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect. There is (i) no unfair labor
practice complaint pending against the Borrower or any Subsidiary of the
Borrower or, to the Borrower's knowledge, threatened against any of them, before
the National Labor Relations Board, and no grievance or arbitration proceeding
arising out of or under any collective bargaining agreement is so pending
against the Borrower or any Subsidiary of the Borrower or, to the Borrower's
knowledge, threatened against any of them, (ii) no strike, labor dispute, work
slowdown or stoppage pending against the Borrower or any Subsidiary of the
Borrower or, to the Borrower's knowledge, threatened against any of them and
(iii) no union representation petition existing with respect to the employees of
the Borrower or any Subsidiary of the Borrower and no union organizing
activities are taking place, except with respect to any matter specified in
clause (i), (ii) or (iii) above, either individually or in the aggregate, such
as is not reasonably likely to have a Material Adverse Effect.
6.21 EXISTING INDEBTEDNESS. Annex IX sets forth a true and
complete list of all Indebtedness of the Borrower and each of its Subsidiaries
as of the Restatement Effective Date and which is to remain outstanding after
giving effect to the Transaction (excluding the Loans, the Letters of Credit and
the Senior Subordinated Notes, collectively the "Existing Indebtedness"), in
each case showing the aggregate principal amount thereof and the name of the
respective borrower (or issuer) and any other entity which directly or
indirectly guaranteed such debt.
6.22 CAPITALIZATION. On the Restatement Effective Date and
after giving effect to the Transaction and the other transactions contemplated
hereby, the authorized capital stock of the Borrower shall consist of (x) 1,035
shares of Class A Common Stock of which 135.835 shares shall be issued and
outstanding, (y) 215 shares of Class B Common Stock of which no shares shall be
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issued and outstanding and (z) no shares of preferred stock. All such
outstanding shares have been duly and validly issued, are fully paid and
nonassessable and are free of preemptive rights. Except as set forth on Annex X,
neither the Borrower nor any of its Subsidiaries has outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock.
6.23 SENIOR SUBORDINATED NOTES. (a) As of the Restatement
Effective Date, the Senior Subordinated Notes have been duly authorized, issued
and delivered in accordance with applicable law and the offering memorandum
relating thereto, and such offering memorandum, as of the date of its issue,
does not contain any untrue statement of a material fact nor omit to state a
material fact necessary in order to make the statements contained therein, in
the light of the circumstances under which they were made, not misleading.
(b) The subordination provisions contained in the Senior
Subordinated Notes and in the other Senior Subordinated Note Documents are
enforceable against the Borrower and the holders of the Senior Subordinated
Notes, and all Obligations are within the definition of "Senior Debt" and
"Designated Senior Debt" included in such subordination provisions.
6.24 ADDRESSING THE YEAR 2000 PROBLEM. All Information Systems
and Equipment are either Year 2000 Compliant, or any reprogramming, remediation,
or any other corrective action, including the internal testing of all such
Information Systems and Equipment, will be completed by January 1, 1999.
Further, to the extent that such reprogramming/remediation and testing action is
required, the cost thereof, as well as the cost of the reasonably foreseeable
consequences of failure to become Year 2000 Compliant, to the Borrower and its
Subsidiaries (including, without limitation, reprogramming errors and the
failure of other systems or equipment) will not result in a Default or a
Material Adverse Effect.
SECTION 7. AFFIRMATIVE COVENANTS. The Borrower covenants and
agrees that as of the Restatement Effective Date and thereafter for so long as
this Agreement is in effect and until the Total Revolving Loan Commitment has
terminated, no Letters of Credit or Notes are outstanding and the Loans and
Unpaid Drawings, together with interest, Fees and all other Obligations (other
than indemnities described in Section 12.13 hereof which are not then due and
payable) incurred hereunder, are paid in full:
7.01 INFORMATION COVENANTS. The Borrower will furnish to each
Bank:
(a) ANNUAL FINANCIAL STATEMENTS. Within 90 days after the
close of each fiscal year of the Borrower, the consolidated balance sheet of the
Borrower and its Subsidiaries, as at the end of such fiscal year and the related
consolidated statements of income and retained earnings and of cash flows for
such fiscal year, in each case setting forth comparative consolidated figures
for the preceding fiscal year, and in the case of the consolidated financial
statements, examined by ▇▇▇▇▇, ▇▇▇▇▇▇ and Company LLP, any "big six" independent
certified public accountants or such other independent certified public
accountants of recognized national standing acceptable to the Administrative
Agent whose opinion shall not be qualified as to the scope of audit or as to the
status of the Borrower or any of its Subsidiaries as a going concern, together
with a certificate of such accounting firm stating that in the course of its
regular audit of the business of the Borrower, which
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audit was conducted in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge of any Default or Event of
Default which has occurred and is continuing or, if in the opinion of such
accounting firm such a Default or Event of Default has occurred and is
continuing, a statement as to the nature thereof.
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available and
in any event within 45 days after the close of each of the first three quarterly
accounting periods in each fiscal year of the Borrower, the consolidated balance
sheet of the Borrower and its Subsidiaries, as at the end of such quarterly
accounting period and the related consolidated statements of income and retained
earnings and of cash flows for such quarterly accounting period and for the
elapsed portion of the fiscal year ended with the last day of such quarterly
accounting period, and in each case setting forth comparative consolidated
figures for the related periods in the prior fiscal year, all of which shall be
certified by the chief financial officer or controller of the Borrower, subject
to changes resulting from audit and normal year-end audit adjustments.
(c) MONTHLY REPORTS. As soon as practicable, and in any event
within 30 days after the end of each monthly accounting period of each fiscal
year of the Borrower (other than the last monthly accounting period in such
fiscal year), monthly reports in a form reasonably satisfactory to the
Administrative Agent, which shall include the consolidated balance sheet of the
Borrower and its Subsidiaries, as at the end of such monthly accounting period,
and the related consolidated statements of income and cash flow for such monthly
accounting period, setting forth (i) comparative figures to the budget prepared
in accordance with Section 7.01(d) and (ii) in the case of each monthly
accounting period commencing with August 1999, comparative figures to the
figures for the related periods in the prior fiscal year.
(d) BUDGETS; ETC. Not more than 60 days after the commencement
of each fiscal year of the Borrower, a budget of the Borrower and its
Subsidiaries in reasonable detail for each of the twelve months of such fiscal
year. Together with each delivery of consolidated financial statements pursuant
to Sections 7.01(a), (b) and (c), a comparison of the current year to date
financial results against the budgets required to be submitted pursuant to this
clause (d) shall be presented.
(e) OFFICER'S CERTIFICATES. At the time of the delivery of the
financial statements provided for in Sections 7.01(a) (b) and (c), a certificate
of the chief financial officer, controller or other Authorized Officer of the
Borrower to the effect that no Default or Event of Default exists or, if any
Default or Event of Default does exist, specifying the nature and extent
thereof, which certificate, in the case of the certificate delivered pursuant to
(x) Sections 7.01(a) and (b), shall set forth the calculations required to
establish whether the Borrower and its Subsidiaries were in compliance with the
provisions of Sections 8.05, 8.08(a) (but only to the extent the Borrower has
made payments of the type described in clause (ii) thereof in such fiscal
quarter or year), 8.10 and 8.11 as at the end of such fiscal quarter or year, as
the case may be and (y) Section 7.01(c), shall set forth the calculation of the
Leverage Ratio, together with the calculations required to establish such ratio;
PROVIDED that nothing contained in this clause (y) shall require any calculation
to be made on a monthly basis if such calculation is not otherwise required to
be made on a monthly basis.
(f) NOTICE OF DEFAULT OR LITIGATION. Promptly, and in any
event within three Business Days after the Borrower obtains knowledge thereof,
notice of (x) the occurrence of any event which constitutes a Default or an
Event of Default, which notice shall specify the nature thereof, the period
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of existence thereof and what action the Borrower proposes to take with respect
thereto or (y) the commencement of or any significant development in any
litigation or governmental proceeding pending against the Borrower or any of its
Subsidiaries which is reasonably likely to have a Material Adverse Effect or is
reasonably likely to have a material adverse effect on the ability of the
Borrower or any other Credit Party to perform its obligations hereunder or under
any other Credit Document.
(g) ENVIRONMENTAL MATTERS. Promptly upon, and in any event
within ten Business Days after, an officer of the Borrower or any of its
Subsidiaries obtains knowledge thereof, notice of one or more of the following
environmental matters, unless such environmental matters could not, individually
or when aggregated with all other such environmental matters, be reasonably
expected to have a Material Adverse Effect:
(i) any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Property owned or
operated by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any Real
Property owned or operated by the Borrower or any of its Subsidiaries
that (a) results in noncompliance by the Borrower or any of its
Subsidiaries with any applicable Environmental Law or (b) could
reasonably be expected to form the basis of an Environmental Claim
against the Borrower or any of its Subsidiaries or any such Real
Property;
(iii) any condition or occurrence on any Real Property owned or
operated by the Borrower or any of its Subsidiaries that could
reasonably be expected to cause such Real Property to be subject to any
restrictions on the ownership, occupancy, use or transferability by the
Borrower or any of its Subsidiaries of such Real Property under any
Environmental Law; and
(iv) the taking of any removal or remedial action in response to
the actual or alleged presence of any Hazardous Material on any Real
Property owned or operated by the Borrower or any of its Subsidiaries
as required by any Environmental Law or any governmental or other
administrative agency; PROVIDED that in any event the Borrower shall
deliver to each Bank all notices received by it or any of its
Subsidiaries from any government or governmental agency under, or
pursuant to, CERCLA.
All such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and the
Borrower's or such Subsidiary's response thereto. In addition, the Borrower will
provide the Banks with copies of all material communications with any government
or governmental agency relating to Environmental Laws, all material
communications with any Person (other than its attorneys) relating to any
Environmental Claim of which notice is required to be given pursuant to this
Section 8.01(g), and such detailed reports of any such Environmental Claim as
may reasonably be requested by the Banks.
(h) AUDITORS' REPORTS. Promptly upon receipt thereof, a copy
of each final report or "management letter" submitted to the Borrower by its
independent accountants in connection with any annual, interim or special audit
made by it of the books of the Borrower.
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(i) OTHER INFORMATION. From time to time, such other
information or documents (financial or otherwise) as the Administrative Agent on
its own behalf or on behalf of the Required Banks may reasonably request from
time to time.
7.02 BOOKS, RECORDS AND INSPECTIONS; BANK MEETINGS. (a) The
Borrower will, and will cause each of its Subsidiaries to, permit, upon
reasonable notice to the chief financial officer, controller or any other
Authorized Officer of the Borrower, (x) officers and designated representatives
of the Administrative Agent or the Required Banks to visit and inspect any of
the properties or assets of the Borrower or any of its Subsidiaries in
whomsoever's possession, and to examine the books of account of the Borrower or
any of its Subsidiaries and discuss the affairs, finances and accounts of the
Borrower or of any of its Subsidiaries with, and be advised as to the same by,
its and their officers and independent accountants, all at such reasonable times
and intervals and to such reasonable extent as the Administrative Agent or the
Required Banks may desire and (y) not more than once per year (and at any time
during the occurrence of a Default or an Event of Default) the Administrative
Agent, or a third party designated by the Administrative Agent, to conduct, at
the Borrower's expense, an audit of the accounts receivable and inventories of
the Borrower and its Subsidiaries at such times as the Administrative Agent
shall reasonably require.
(b) At the request of the Administrative Agent, the Borrower
shall within 120 days after the close of each fiscal year of the Borrower hold a
meeting at a time and place selected by the Borrower and acceptable to the
Administrative Agent with all of the Banks at which meeting shall be reviewed
the financial results of the previous fiscal year and the financial condition of
the Borrower and its Subsidiaries and the budgets presented for the current
fiscal year of the Borrower and its Subsidiaries.
7.03 MAINTENANCE OF PROPERTY; INSURANCE. The Borrower will,
and will cause each of its Subsidiaries to, at all times maintain in full force
and effect insurance in such amounts, covering such risks and liabilities and
with such deductibles or self-insured retentions as are in accordance with
normal industry practice. At any time that insurance at the levels described in
Annex XI is not being maintained by the Borrower and its Subsidiaries, the
Borrower will notify the Banks in writing thereof and, if thereafter notified by
the Administrative Agent to do so, the Borrower will, and will cause each of its
Subsidiaries to, obtain insurance at such levels at least equal to those set
forth in Annex XI to the extent then generally available, or otherwise as are
acceptable to the Administrative Agent. The Borrower will, and will cause each
of its Subsidiaries to, furnish on the Restatement Effective Date and annually
thereafter to the Administrative Agent, upon its request, a summary of the
insurance carried together with certificates of insurance and other evidence of
such insurance, if any, naming the Collateral Agent as an additional insured
and/or loss payee.
7.04 PAYMENT OF TAXES. The Borrower will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which material penalties attach thereto, and all lawful claims for sums that
have become due and payable which, if unpaid, might become a Lien not otherwise
permitted pursuant to Section 8.03(a) or charge upon any properties of the
Borrower or any of its Subsidiaries, PROVIDED that neither the Borrower nor any
Subsidiary of the Borrower shall be required to pay any such tax,
assessment, charge, levy or claim which is being contested in good faith and by
proper proceedings if it has maintained adequate reserves (in the good faith
judgment of the management of the
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Borrower) with respect thereto in accordance with GAAP.
7.05 CORPORATE FRANCHISES. The Borrower will do, and will
cause each of its Subsidiaries to do, or cause to be done, all things necessary
to preserve and keep in full force and effect its existence, material rights and
authority, PROVIDED that any transaction permitted by Section 8.02 will not
constitute a breach of this Section 7.05.
7.06 COMPLIANCE WITH STATUTES, ETC. The Borrower will, and
will cause each of its Subsidiaries to, comply with all applicable statutes
(including, without limitation, all applicable Environmental Laws), regulations
and orders of, and all applicable restrictions imposed by, all governmental
bodies, domestic or foreign, in respect of the conduct of its business and the
ownership of its property except for such non-compliance which would not have a
Material Adverse Effect or would not have a material adverse effect on the
ability of any Credit Party to perform its obligations under any Credit Document
to which it is party.
7.07 ERISA. As soon as possible and, in any event, within 10
days after the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
knows or has reason to know of the occurrence of any of the following, the
Borrower will deliver to each of the Banks a certificate of the chief financial
officer of the Borrower setting forth the full details as to such occurrence and
the action, if any, which the Borrower, a Subsidiary or an ERISA Affiliate is
required or proposes to take, together with any notices required or proposed to
be given to or filed with or by the Borrower, the Subsidiary, the ERISA
Affiliate, the PBGC, a Plan participant or the Plan administrator with respect
thereto: that a Reportable Event has occurred; (except to the extent that the
Borrower has previously delivered to the Banks a certificate and notices (if
any) concerning such event pursuant to the next clause hereof); that a
contributing sponsor as defined in Section 4001(a)(13) of ERISA of a Plan
subject to the requirements of PBGC Regulation Section 4043.61 (without regard
to subparagraph (b)(1) thereof) and an event described in subsection .62, .63,
.64, .65, .66, .67 or .68 of PBGC Regulation Section 4043 is reasonably expected
to occur with respect to such Plan within the following 30 days; that an
accumulated funding deficiency within the meaning of Section 412 of the Code or
Section 302 of ERISA has been incurred or an application may be or has been made
for a waiver or modification of the minimum funding standard (including any
required installment payments) or an extension of any amortization period under
Section 412 of the Code or Section 303 or 304 of ERISA, with respect to a Plan;
that any contribution required to be made with respect to a Plan has not been
timely made; that a Plan has been or may be terminated, reorganized, partitioned
or declared insolvent under Title IV of ERISA; that a Plan has an Unfunded
Current Liability; that proceedings may be or have been instituted to terminate
a Plan which is subject to Title IV of ERISA; that a proceeding has been
instituted pursuant to Section 515 of ERISA to collect a delinquent contribution
to a Plan; that the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate will or may incur any liability to or on account of the termination of
or withdrawal from a Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or
4212 of ERISA or with respect to a Plan under Section 401(a)(29), 4971, 4975 or
4980 of the Code or Section 409, 502(i) or 502(l) of ERISA or with respect to a
group health plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2)
of the Code) under Section 4980B of the Code; or that the Borrower or any
Subsidiary of the Borrower may incur any material liability pursuant to any
employee welfare benefit plan (as defined in Section 3(l) of ERISA) that
provides benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any Plan other than any Plan subject to
Title IV of ERISA and/or Section 412 of the Code. The Borrower will deliver to
the
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Banks (i) a complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each Plan (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with the
Internal Revenue Service and (ii) copies of any records, documents or other
information that must be furnished to the PBGC with respect to any Plan pursuant
to Section 4010 of ERISA. In addition to any certificates or notices delivered
to the Banks pursuant to the first sentence hereof, copies of annual reports and
any records, documents and other information required to be furnished to the
PBGC, and any material notices received by the Borrower any Subsidiary of the
Borrower or any ERISA Affiliate with respect to a Plan shall be delivered to the
Banks no later than 10 days after the date such report has been filed with the
Internal Revenue Service or such records, documents and/or information has been
furnished to the PBGC or such notice has been received by the Borrower, the
Subsidiary or the ERISA Affiliate, as applicable.
7.08 GOOD REPAIR. The Borrower will, and will cause each of
its Subsidiaries to, ensure that its material properties and equipment used or
useful in its business in whomsoever's possession they may be, are kept, in all
material respects, in good repair, working order and con-
dition, normal wear and tear excepted, and, subject to Section 8.05, that from
time to time there are made in such properties and equipment all needful and
proper repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto, to the extent and in the manner useful or customary for
companies in similar businesses.
7.09 END OF FISCAL YEARS; FISCAL QUARTERS. The Borrower will,
for financial reporting and tax purposes, cause (i) each of its, and each of its
Subsidiaries' fiscal years to end on December 31 of each year and (ii) each of
its, and each of its Subsidiaries' fiscal quarters to end on March 31, June 30,
September 30 and December 31 of each year.
7.10 USE OF PROCEEDS. All proceeds of the Loans shall be used
as provided in Section 6.05.
7.11 ADDITIONAL SECURITY; FURTHER ASSURANCES. (a) The Borrower
will, and will cause each of its Subsidiaries to, grant to the Collateral Agent
security interests and mortgages (each an "Additional Mortgage") in such owned
Real Property of the Borrower and its Subsidiaries acquired after the
Restatement Effective Date as may be requested from time to time by the
Administrative Agent (each such Real Property, an "Additional Mortgaged
Property") it being understood and agreed that at any time after the Real
Property located in Baltimore, Maryland ceases to be encumbered by a mortgage in
favor of JMC Industries, Inc., the Borrower shall, upon the reasonable request
of the Collateral Agent, grant to the Collateral Agent an Additional Mortgage on
such Real Property so long as the requested action does not result in undue
costs in relation to the benefit to be received. Such Additional Mortgages shall
be granted pursuant to documentation reasonably satisfactory in form and
substance to the Administrative Agent and shall constitute valid and enforceable
Liens superior to and prior to the rights of all third Persons and subject to no
other Liens except as are permitted by Section 8.03. The Additional Mortgages or
instruments related thereto shall be duly recorded or filed in such manner and
in such places as are required by law to establish, perfect, preserve and
protect the Liens in favor of the Collateral Agent required to be granted
pursuant to the Additional Mortgages and all taxes, fees and other charges
payable in connection therewith shall have been paid in full by the Borrower.
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(b) The Borrower will, and will cause each of its Subsidiaries
to, at the expense of the Borrower, make, execute, endorse, acknowledge, file
and/or deliver to the Collateral Agent from time to time such vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, real
property surveys, reports and other assurances or instruments and take such
further steps relating to the Collateral covered by any of the Security
Documents as the Collateral Agent may reasonably require. Furthermore, the
Borrower will cause to be delivered to the Collateral Agent such opinions of
counsel, title insurance and other related documents as may be requested by the
Administrative Agent to assure themselves that this Section 7.11 has been
complied with.
(c) The Borrower agrees that each action required by clauses
(a) and (b) above in this Section 7.11 shall be completed as soon as possible,
but in no event later than 60 days after such action is requested to be taken by
the Administrative Agent or the Required Banks, PROVIDED that in no event shall
the Borrower be required to take any action, other than using its reasonable
commercial efforts without any material expenditure, to obtain consents from
third parties with respect to its compliance with such clauses (a) and (b).
(d) In the event that the Administrative Agent or the Required
Banks at any time after the Restatement Effective Date determine in its or their
good faith discretion that real estate appraisals satisfying the requirements of
FIRREA (any such appraisal a "Required Appraisal") are or were required to be
obtained, or should be obtained, in each case, in accordance with FIRREA, in
connection with the Mortgaged Properties, then, within 120 days after receiving
written notice thereof from the Administrative Agent or the Required Banks, as
the case may be, such Required Appraisal shall be delivered, at the expense of
the Borrower, to the Administrative Agent which Required Appraisal, and the
respective appraiser, shall be satisfactory to the Administrative Agent.
7.12 YEAR 2000 COMPATIBILITY. The Borrower and each of its
Subsidiaries will ensure that its Information Systems and Equipment are at all
times after January 1, 1999 Year 2000 Compliant, except insofar as the failure
to do so will not result in a Material Adverse Effect, and shall notify the
Administrative Agent and any Bank promptly upon detecting any failure of the
Information Systems and Equipment to be Year 2000 Compliant, except insofar as
such failure is not likely to result in a Material Adverse Effect. In addition,
the Borrower shall provide the Administrative Agent with such information about
its year 2000 computer readiness (including, without limitation, information as
to contingency plans, budgets and testing results) as the Administrative Agent
shall reasonably request.
SECTION 8. NEGATIVE COVENANTS. The Borrower covenants and
agrees that as of the Restatement Effective Date and thereafter for so long as
this Agreement is in effect and until the Total Revolving Loan Commitment has
terminated, no Letters of Credit or Notes are outstanding and the Loans and
Unpaid Drawings, together with interest, Fees and all other Obligations (other
than indemnities described in Section 12.13 which are not then due and payable)
incurred hereunder, are paid in full:
8.01 CHANGES IN BUSINESS. The Borrower will not, and will not
permit any of its Subsidiaries to, materially alter the character of the
business of the Borrower and its Subsidiaries from that conducted on the
Restatement Effective Date (after giving effect to the consummation of the
Transaction), provided that this Section 8.01 shall not restrict the making of
any investment
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expressly permitted by Section 8.06 or the consummation of any transaction
expressly permitted by Section 8.02 (except to the extent that 8.02(m)(iii)
requires that Permitted Acquisitions be made in Permitted Businesses).
8.02 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
The Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs, or enter into any transaction of merger or
consolidation, or sell or otherwise dispose of all or any part of its property
or assets (other than inventory or obsolete equipment or excess equipment no
longer needed in the conduct of the business in the ordinary course of business)
or purchase, lease or otherwise acquire all or any part of the property or
assets of any Person (other than leases, purchases or other acquisitions of
inventory, materials and equipment in the ordinary course of business), or agree
to do any of the foregoing at any future time, except that the following shall
be permitted:
(a) any Wholly-Owned Subsidiary of the Borrower may be merged
or consolidated with or into, or be liquidated into, the Borrower or a
Subsidiary Guarantor that is a Wholly- Owned Domestic Subsidiary of the
Borrower (so long as the Borrower or such Subsidiary Guarantor, as the
case may be, is the surviving corporation), or all or any part of the
business, properties or assets of any Wholly-Owned Subsidiary of the
Borrower may be conveyed, leased, sold or transferred to the Borrower
or any Subsidiary Guarantor that is a Wholly- Owned Domestic Subsidiary
of the Borrower;
(b) Consolidated Capital Expenditures to the extent within the
limitations set forth in Section 8.05;
(c) the investments, acquisitions and transfers or
dispositions of properties permitted pursuant to Section 8.06;
(d) the Borrower and its Subsidiaries may lease (as lessee)
real or personal property in the ordinary course of business (so long
as such lease does not create a Capitalized Lease Obligation not
otherwise permitted by Section 8.04(c));
(e) licenses or sublicenses by the Borrower and its
Subsidiaries of software, customer lists, trademarks, service marks,
patents, trade names and copyrights and other intellectual property in
the ordinary course of business, PROVIDED that such licenses or
sublicenses shall not materially interfere with the business of the
Borrower or any such Subsidiary;
(f) other sales or dispositions of assets in the ordinary
course of business (other than assets disposed of in connection with a
Recovery Event) which constitute Asset Sales, PROVIDED that (x) the
aggregate Net Cash Proceeds received from all such sales and
dispositions (when added to the fair market value of all assets
received in connection with such Asset Sales) shall not exceed
$20,000,000, (y) each such sale shall be in an amount at least equal to
the fair market value thereof (as determined in good faith by the
Borrower) and for proceeds consisting solely of (A) not less than 80%
cash and (B) seller indebtedness evidenced by promissory notes, which
promissory notes shall be pledged and delivered to the Collateral Agent
pursuant to the Pledge Agreement and (z) the Net Cash Proceeds of any
such sale are applied to reduce the Total Revolving Loan Commitment to
the extent required by Section 3.03(c) and repay Revolving Loans to the
extent required by Section 4.02(a), and, PROVIDED FURTHER, that the
sale or disposition of the capital stock of (i) any Subsidiary
Guarantor shall be prohibited except as otherwise
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46
permitted pursuant to Section 8.02(a) and (ii) any other Subsidiary of
the Borrower shall be prohibited unless it is for all of the
outstanding capital stock of such Subsidiary owned by the Borrower and
its Subsidiaries;
(g) other sales or dispositions of assets (or similar
transactions) in each case to the extent the Required Banks have
consented in writing thereto and subject to such conditions as may be
set forth in such consent;
(h) any Subsidiary of the Borrower (including any Subsidiary
Guarantor so long as the assets of such Subsidiary Guarantor are
transferred pursuant to Section 8.02(l)) may be liquidated into the
Borrower or a Subsidiary Guarantor that is a Wholly-Owned Domestic
Subsidiary of the Borrower;
(i) each of the Borrower and its Subsidiaries may make sales
or transfers of inventory in the ordinary course of business and
consistent with past practices (including without limitation sales or
transfers of inventory by the Borrower to its Subsidiaries);
(j) the Acquisition shall be permitted;
(k) the Borrower and its Subsidiaries may, in the ordinary
course of business, sell, transfer or otherwise dispose of patents,
trademarks, service marks, trade names and copyrights which, in the
reasonable judgment of the Borrower or such Subsidiary, are determined
to be uneconomical, negligible or obsolete in the conduct of its
business;
(l) any Subsidiary of the Borrower may transfer assets to the
Borrower or to a Subsidiary Guarantor that is a Wholly-Owned Domestic
Subsidiary of the Borrower so long as the security interests granted to
the Collateral Agent pursuant to the Security Documents in the assets
so transferred shall remain in full force and effect and perfected to
at least the same extent as in effect immediately prior to such
transfer); and
(m) the Borrower and its Wholly-Owned Domestic Subsidiaries
may acquire all or substantially all of the assets of any Person (or
all or substantially all of the assets of a product line or division of
any Person) or 100% of the capital stock of any Person (including by
purchasing the remaining portion of the capital stock of any Person in
which the Borrower or a Wholly-Owned Domestic Subsidiary thereof
already has an ownership interest and as a result of which such Person
shall become a Wholly-Owned Domestic Subsidiary of the Borrower) (any
such acquisition permitted by this clause (m), a "Permitted
Acquisition"), so long as (i) no Default or Event of Default then
exists or would result therefrom, (ii) each of the representations and
warranties contained in Section 6 is true and correct in all material
respects both before and after giving effect to such Permitted
Acquisition, (iii) the assets or product line acquired, or the business
of the Person whose stock is acquired, constitutes a Permitted
Business, (iv) any Liens or Indebtedness assumed or issued in
connection with such acquisition are otherwise permitted under Section
8.03 or 8.04, as the case may be, (v) the consideration paid by the
Borrower and Subsidiaries in connection with any Permitted Acquisition
consists solely of cash and/or common stock of the Borrower, (vi) at
least 10 Business Days prior to the consummation of any Permitted
Acquisition, the Borrower shall have delivered to the Administrative
Agent and each of the Banks a certificate of the Borrower's Chief
Financial Officer (or other Authorized Officer) certifying (and showing
the
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calculations therefor in reasonable detail) that the Borrower would
have been in compliance with the financial covenants set forth in
Sections 8.10 and 8.11 for the applicable testing period then most
recently ended prior to the date of the consummation of such Permitted
Acquisition, in each case with such financial covenants to be
determined on a PRO FORMA basis as if such Permitted Acquisition had
been consummated on the first day of the relevant testing period (and
assuming that any Indebtedness incurred, issued or assumed in
connection therewith had been incurred, issued or assumed on the first
day of, and had remained outstanding throughout, such testing period)
and (vii) the aggregate consideration paid in connection with all
Permitted Acquisitions consummated on or after the Restatement
Effective Date (including, without limitation, any earn-out,
non-compete or deferred compensation arrangements and the aggregate
principal amount of any Indebtedness assumed in connection therewith)
does not exceed $10,000,000;and
(n) any sale, transfer or other disposition of assets or
property which does not constitute an Asset Sale.
To the extent the Required Banks waive the provisions of this Section 8.02 with
respect to the sale or other disposition of any Collateral, or any Collateral is
sold or otherwise disposed of as permitted by this Section 8.02, such Collateral
(unless sold to the Borrower or a Subsidiary of the Borrower) shall be sold or
otherwise disposed of free and clear of the Liens created by the Security
Documents, and the Administrative Agent and Collateral Agent shall be authorized
to take any actions deemed appropriate in order to effect the foregoing.
8.03 LIENS. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or
with respect to any property or assets of any kind (real or personal, tangible
or intangible) of the Borrower or any such Subsidiary whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with recourse to the
Borrower or any of its Subsidiaries) or assign any right to receive income, or
file or permit the filing of any financing statement under the UCC or any other
similar notice of Lien under any similar recording or notice statute; PROVIDED
that the provisions of this Section 8.03 shall not prevent the creation,
incurrence, assumption or existence of the following (with such Liens described
below being herein referred to as "Permitted Liens"):
(a) inchoate Liens for taxes, assessments or governmental
charges or rules not yet due or Liens for taxes, assessments or
governmental charges or rules being contested in good faith and by
appropriate proceedings for which adequate reserves (in the good faith
judgment of the management of the Borrower) have been established;
(b) Liens in respect of property or assets of the Borrower or
any of its Subsidiaries imposed by law which were incurred in the
ordinary course of business, such as carriers', warehousemen's and
mechanics' Liens, statutory landlord's Liens, and other similar Liens
arising in the ordinary course of business, and (x) which do not in the
aggregate materially detract from the value of such property or assets
or materially impair the use thereof in the operation of the business
of the Borrower or any such Subsidiary or (y) which are being contested
in good faith by appropriate proceedings, which proceedings have the
effect of preventing the forfeiture or sale of the property or asset
subject to such Lien;
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48
(c) Liens created by or pursuant to this Agreement and the
other Credit Documents;
(d) Liens existing on the Restatement Effective Date to the
extent listed on Annex XII, without giving effect to any subsequent
extensions or renewals thereof;
(e) Liens arising from judgments, decrees or attachments (or
securing of appeal bonds with respect thereto) in circumstances not
constituting an Event of Default under Section 9.09, so long as no cash
or property (other than proceeds of insurance payable by reason of such
judgments, decrees or attachments) is deposited or delivered to secure
any respective judgment or award, or any appeal bond in respect
thereof, the fair market value of which exceeds $1,500,000;
(f) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory
obligations, surety bonds (other than appeal bonds), bids, leases,
government contracts, obligations to utilities, performance and
return-of-money bonds and other similar obligations incurred in the
ordinary course of business (exclusive of obligations in respect of the
payment for borrowed money);
(g) leases, subleases or licenses granted to others not
interfering in any material respect with the business of the Borrower
or any of its Subsidiaries;
(h) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the
business of the Borrower or any of its Subsidiaries;
(i) Liens arising from UCC financing statements regarding
leases not in violation of this Agreement;
(j) purchase money Liens securing payables arising from the
purchase by the Borrower or any of its Subsidiaries of any equipment or
goods in the normal course of business, PROVIDED that such payables
shall not constitute Indebtedness;
(k) any interest or title of a lessor under any lease
permitted by this Agreement;
(l) Liens arising pursuant to purchase money mortgages
relating to, or security interests securing Indebtedness representing,
the purchase price or financing thereof of assets acquired by the
Borrower or any of its Subsidiaries after the Restatement Effective
Date and Liens created pursuant to Capital Leases, provided that any
such Liens attach only to the assets so acquired and that all
Indebtedness secured by Liens created pursuant to this clause (l) shall
not exceed the amount permitted pursuant to Section 8.04(c) at any time
outstanding;
(m) Permitted Encumbrances; and
(n) Liens securing Indebtedness not in excess of $100,000 at
any time outstanding.
8.04 INDEBTEDNESS. The Borrower will not, and will not permit
any of its Subsidiaries
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to, contract, create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the
other Credit Documents;
(b) Indebtedness owing by (i) any Subsidiary Guarantor to
another Subsidiary Guarantor or to the Borrower, (ii) any Subsidiary of
the Borrower that is not a Subsidiary Guarantor to another Subsidiary
of the Borrower that is not a Subsidiary Guarantor and (iii) the
Borrower to any Subsidiary Guarantor;
(c) Capitalized Lease Obligations of the Borrower and its
Subsidiaries incurred by the Borrower or any of its Subsidiaries after
the Restatement Effective Date and Indebtedness incurred pursuant to
purchase money mortgages permitted by Section 8.03(l), PROVIDED that
the aggregate amount of Indebtedness incurred pursuant to this clause
(c) shall not exceed $5,000,000 at any time outstanding;
(d) Existing Indebtedness, without giving effect to any
subsequent extension, renewal or refinancing thereof;
(e) Indebtedness under Interest Rate Agreements relating to
Indebtedness otherwise permitted under this Section 8.04;
(f) Indebtedness incurred pursuant to purchase money mortgage
permitted by Section 8.03(l);
(g) Contingent Obligations of the Borrower or any Subsidiary
Guarantor with respect to Indebtedness and lease obligations of the
Borrower or any Subsidiary Guarantor otherwise permitted under this
Agreement;
(h) Indebtedness of the Borrower under the Senior Subordinated
Notes in an aggregate principal amount not to exceed $120,000,000 (as
reduced by any repayments of principal thereof);
(i) the Borrower may issue up to $5,000,000 in aggregate
principal amount of subordinated promissory notes pursuant to Section
4.4(c) of the GEO Shareholders' Agreement; and
(j) Additional Indebtedness of the Borrower and its
Subsidiaries not to exceed an aggregate outstanding principal amount of
$10,000,000 at any time.
8.05 CAPITAL EXPENDITURES. (a) The Borrower will not, and will
not permit any of its Subsidiaries to, incur Consolidated Capital Expenditures,
PROVIDED that the Borrower and its Subsidiaries may make up to $10,000,000 in
Consolidated Capital Expenditures during each fiscal year (taken as one
accounting period).
(b) In the event that the maximum amount which is permitted to
be expended in respect of Consolidated Capital Expenditures during any fiscal
year of the Borrower pursuant to Sections 8.05(a), (c) and (d) (without giving
effect to this clause (b)) is not fully expended during
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such fiscal year, the maximum amount which may be expended during the
immediately succeeding fiscal year pursuant to Sections 8.05(a), (c) and (d)
shall be increased by such unutilized amount, PROVIDED that such increase shall
not exceed $1,000,000 in any fiscal year of the Borrower.
(c) In addition to the foregoing, the amount of insurance
proceeds received by the Borrower and its Subsidiaries from any Recovery Event
may be used by the Borrower or such Subsidiary to make Consolidated Capital
Expenditures to replace or restore any properties or assets in respect of which
such proceeds were paid or to otherwise acquire productive assets usable in the
business of the Borrower.
(c) In addition to the foregoing, the Borrower and the
Subsidiary Guarantors may make Consolidated Capital Expenditures to the extent
such Consolidated Capital Expenditures also constitute the reinvestment of Net
Cash Proceeds from Asset Sales not giving rise to a reduction to the Total
Revolving Loan Commitment pursuant to Section 3.03(c).
8.06 ADVANCES, INVESTMENTS AND LOANS. The Borrower will not,
and will not permit any of its Subsidiaries to, lend money or credit or make
advances to any Person, or purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution to,
any Person, except:
(a) the Borrower and its Subsidiaries may acquire and hold
receivables owing to them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms;
(b) the intercompany Indebtedness described in Section 8.04(b)
shall be permitted;
(c) investments made by the Borrower in Subsidiary Guarantors
that are Wholly- Owned Subsidiaries shall be permitted;
(d) loans and advances to employees in an aggregate principal
amount not to exceed $100,000 at any time outstanding shall be
permitted;
(e) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection with
the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of business;
(f) Interest Rate Agreements permitted by Section 8.04(e)
shall be permitted;
(g) the Borrower may hold the promissory notes acquired in
accordance with Section 8.02(f);
(h) the Borrower may repurchase stock to the extent permitted
by Section 8.08(a)(ii);
(i) the Borrower and its Subsidiaries may make Permitted
Acquisitions;
(j) the Borrower and its Subsidiaries may invest in cash and
Cash Equivalents; and
(k) the Borrower may redeem up to 35% of the aggregate
principal amount of the
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Senior Subordinated Notes pursuant to Section 6(b) thereof.
8.07 PREPAYMENTS OF INDEBTEDNESS; MODIFICATIONS OF CERTIFICATE
OF INCORPORATION, BYLAWS AND CERTAIN OTHER AGREEMENTS, ETC. (a) Other than the
redemption permitted by Section 8.06(k) the Borrower will not, and will not
permit any of its Subsidiaries to, (x) make (or give any notice in respect
thereof) any voluntary or optional payment or prepayment or redemption or
acquisition for value of (including, without limitation, by way of depositing
with the trustee with respect thereto money or securities before due for the
purpose of paying when due) or exchange or refinancing of the Senior
Subordinated Notes or any Existing Indebtedness, (y) amend, modify or change in
any manner the Senior Subordinated Notes Documents or any other agreements
(including, without limitation, the Existing Indebtedness Agreements) relating
to the Senior Subordinated Notes or to any Existing Indebtedness or (z) amend,
modify or change in any manner materially adverse to the interests of the Banks,
the Certificate of Incorporation (including, without limitation, by the filing
of any additional certificate of designation) or By-Laws of the Borrower or any
of its Subsidiaries, the terms of any of its capital stock or any agreement
entered into by the Borrower with respect to its capital stock (including,
without limitation, the Warrants and the Warrant Agreements), the "Transaction
Documents" (as defined in the Existing Credit Agreement (including, without
limitation, the GEO Shareholders' Agreement), or enter into any new agreement in
any manner materially adverse to the interests of the Banks with respect to the
capital stock of the Borrower.
(b) Other than the Obligations, the Borrower shall not
designate and shall not permit any Indebtedness to be designated as "Designated
Senior Debt" under and as defined in the Senior Subordinated Notes Documents.
8.08 DIVIDENDS, ETC. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, declare or pay any dividends (other than
dividends payable solely in capital stock of such Person) or return any capital
to its stockholders or authorize or make any other distribution, payment or
delivery of property or cash to its stockholders as such, or redeem, retire,
purchase or otherwise acquire, directly or indirectly, for a consideration, any
shares of any class of its capital stock now or hereafter outstanding (or any
warrants for or options or stock appreciation rights in respect of any of such
shares), or set aside any funds for any of the foregoing purposes, or permit any
of its Subsidiaries to purchase or otherwise acquire for consideration any
shares of any class of the capital stock of the Borrower or any other
Subsidiary, as the case may be, now or hereafter outstanding (or any options or
warrants or stock appreciation rights issued by such Person with respect to its
capital stock) (all of the foregoing "Dividends"), except that:
(i) any Subsidiary of the Borrower may pay cash dividends to
the Borrower or to a Wholly-Owned Subsidiary of the Borrower; and
(ii) so long as no Default or Event of Default has occurred and
is continuing or would result therefrom, the Borrower may redeem or
repurchase for cash (or in consideration of the issuance of
subordinated notes permitted to be issued by Section 8.04(i)), at fair
value, the capital stock of the Borrower (or options to purchase
capital stock) from any employee of the Borrower upon the death,
disability, retirement or other termination of such employee, PROVIDED
that all cash repurchases under this clause (ii) shall not exceed, in
the aggregate, when added to all payments made under the subordinated
notes permitted by Section 8.04(i),
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$1,000,000 (increased by the amount of proceeds received by the
Borrower in connection with the issuance of capital stock to directors
or employees of the Borrower and its Subsidiaries after the Restatement
Effective Date); PROVIDED FURTHER, the Borrower may effect such
repurchases without regard to the dollar limitations set forth above
solely with the proceeds of key man life insurance obtained for the
purpose of making such repurchases.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist any encumbrance or
restriction which prohibits or otherwise restricts (A) the ability of any
Subsidiary of the Borrower to (a) pay dividends or make other distributions or
pay any Indebtedness owed to the Borrower or any other Subsidiary of the
Borrower, (b) make loans or advances to the Borrower or any other Subsidiary of
the Borrower, or (c) transfer any of its properties or assets to the Borrower or
any other Subsidiary of the Borrower or (B) the ability of the Borrower or any
other Subsidiary of the Borrower to create, incur, assume or suffer to exist any
Lien upon its property or assets to secure the Obligations, other than
prohibitions or restrictions existing under or by reason of:
(i) this Agreement, the other Credit Documents and the other
Transaction Documents;
(ii) applicable law;
(iii) customary non-assignment provisions entered into in the
ordinary course of business and consistent with past practices;
(iv) any restriction or encumbrance with respect to a Subsidiary
of the Borrower imposed pursuant to an agreement which has been entered
into for the sale or disposition of all or substantially all of the
capital stock or assets of such Subsidiary, so long as such sale or
disposition is permitted under this Agreement; and
(v) Liens permitted under Section 8.03 and any documents or
instruments governing the terms of any Indebtedness or other
obligations secured by any such Liens, PROVIDED that such prohibitions
or restrictions apply only to the assets subject to such Liens.
8.09 TRANSACTIONS WITH AFFILIATES. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into any transaction or series
of transactions after the Restatement Effective Date whether or not in the
ordinary course of business, with any Affiliate other than on terms and
conditions substantially as favorable to the Borrower or such Subsidiary as
would be obtainable by the Borrower or such Subsidiary at the time in a
comparable arm's length transaction with a Person other than an Affiliate;
PROVIDED that the foregoing restrictions shall not apply to (i) Dividends
permitted under Section 8.08, (ii) transactions between the Borrower and its
Subsidiaries to the extent otherwise expressly permitted under this Agreement,
(iii) employment arrangements (including arrangements made with respect to
bonuses) entered into in the ordinary course of business with members of the
Board of Directors of the Borrower and of its Subsidiaries and (iv) any
Shareholders' Agreements as in effect on the Restatement Effective Date.
8.10 INTEREST COVERAGE RATIO. The Borrower will not permit the
Interest Coverage Ratio for any period of four consecutive fiscal quarters (or,
if shorter, the period beginning on the Restatement Effective Date and ended on
the last day of a fiscal quarter ended after the Restatement
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53
Effective Date), in each case taken as one accounting period, ended on
the last day of a fiscal quarter described below to be less than the
amount set forth opposite such fiscal quarter below:
FISCAL QUARTER RATIO
-------------- ---------
September 30, 1998 1.50:1.00
December 31, 1998 1.50:1.00
March 31, 1999 1.75:1.00
June 30, 1999 1.75:1.00
September 30, 1999 2.00:1.00
December 31, 1999 2.00:1.00
March 31, 2000 and 2.25:1.00
thereafter
8.11 LEVERAGE RATIO. The Borrower will not permit the Leverage
Ratio of the Borrower at any time during a fiscal quarter of the Borrower set
forth below to be greater than the ratio set forth opposite such fiscal quarter:
FISCAL QUARTER RATIO
-------------- ---------
September 30, 1998 5.75:1.00
December 31, 1998 5.75:1.00
March 31, 1999 5.50:1.00
June 30, 1999 5.50:1.00
September 30, 1999 5.25:1.00
December 31, 1999 5.25:1.00
March 31, 2000 5.00:1.00
June 30, 2000 5.00:1.00
September 30, 2000 4.75:1.00
December 31, 2000 4.50:1.00
and thereafter
8.12 ISSUANCE OF STOCK. The Borrower will not issue any shares
of capital stock (other than (i) in connection with the Equity Financing or (ii)
issuances of common stock of the Borrower not creating a Change of Control), and
will not permit any of its Subsidiaries directly or indirectly to issue, sell,
assign, pledge or otherwise encumber or dispose of any shares of its capital
stock or other securities (or warrants, rights or options to acquire shares or
other equity securities) of such Subsidiary, except to the extent permitted by
Section 8.03, to the Borrower and/or any Subsidiary Guarantor or to qualify
directors if required by applicable law.
8.13 LIMITATION ON CREATION OF SUBSIDIARIES. The Borrower
shall not, and shall not permit any of its Subsidiaries to, establish, create or
acquire any additional Subsidiaries without the prior written consent of the
Required Banks, PROVIDED that the Borrower and its Wholly-Owned Subsidiaries
shall be permitted to establish or create Wholly-Owned Subsidiaries so long as
(i) at least 5 days' prior written notice thereof (or such lesser notice as is
acceptable to the Administrative Agent) is given to the Administrative Agent,
(ii) such new Subsidiaries shall execute and deliver (x) in the case of the
first such Subsidiary so established, created or acquired (unless a Subsidiary
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Guaranty has been executed and delivered prior to such date pursuant to Section
5.13), the Subsidiary Guaranty and (y) otherwise, such guarantees and security
documents as the Required Banks shall request (including documents substantially
similar to or amendments to each of the Pledge Agreement and the Security
Agreement), and in such forms as shall be satisfactory to them, (iii) the
holders of the capital stock of such new Subsidiaries shall execute and deliver
additional pledge agreements, in form and substance satisfactory to the
Administrative Agent and (iv) such new Subsidiaries shall execute and deliver,
or cause to be executed and delivered, all other relevant documentation of the
type described in Section 5 as such new Subsidiaries would have had to deliver
if such new Subsidiaries were Credit Parties on the Restatement Effective Date.
SECTION 9. EVENTS OF DEFAULT. Upon the occurrence of any of
the following specified events (each an "Event of Default"):
9.01 PAYMENTS. The Borrower shall (i) default in the payment
when due of any principal of the Loans or (ii) default, and such default shall
continue for three or more Business Days, in the payment when due of any Unpaid
Drawing, any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document; or
9.02 REPRESENTATIONS, ETC. Any representation, warranty or
statement made by any Credit Party herein or in any other Credit Document or in
any statement or certificate delivered or required to be delivered pursuant
hereto or thereto shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
9.03 COVENANTS. The Borrower or any of its Subsidiaries shall
(a) default in the due performance or observance by it of any term, covenant or
agreement contained in Sections 7.01(f)(x), 7.09 or 8, or (b) default in the due
performance or observance by it of any term, covenant or agreement (other than
those referred to in Section 9.01, 9.02 or clause (a) of this Section 9.03)
contained in this Agreement and such default shall continue unremedied for a
period of at least 30 days after notice to the defaulting party by the
Administrative Agent or the Required Banks; or
9.04 DEFAULT UNDER OTHER AGREEMENTS. (a) The Borrower or any
of its Subsidiaries shall (i) default in any payment with respect to any
Indebtedness (other than the Obligations) beyond the period of grace, if any,
applicable thereto or (ii) default in the observance or performance of any
agreement or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause, any such Indebtedness to become due prior to its stated maturity or (b)
any such Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment, prior to the stated maturity thereof,
PROVIDED that it shall not constitute an Event of Default pursuant to this
Section 9.04 unless the principal amount of any one issue of such Indebtedness
exceeds $1,500,000 or the aggregate amount of all Indebtedness referred to in
clauses (a) and (b) above exceeds $2,500,000 at any one time; or
9.05 BANKRUPTCY, ETC. The Borrower or any of its Subsidiaries
shall commence a voluntary case concerning itself under Title 11 of the United
States Code entitled "Bankruptcy," as now or hereafter in effect, or any
successor thereto (the "Bankruptcy Code"); or an involuntary case is commenced
against the Borrower or any of its Subsidiaries and the petition is not
controverted
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within 10 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of, all or substantially all of the property of the Borrower or any
of its Subsidiaries; or the Borrower or any of its Subsidiaries commences any
other proceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Borrower or any
of its Subsidiaries; or there is commenced against the Borrower or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days; or the Borrower or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; the Borrower or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Borrower or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
9.06 ERISA. (a) Any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof under Section 412 of
the Code or Section 302 of ERISA or a waiver of such standard or extension of
any amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, any Plan which is
subject to Title IV of ERISA shall have had or is likely to have a trustee
appointed to administer such Plan, any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made with respect to a Plan or a
Foreign Pension Plan has not been timely made, the Borrower or any Subsidiary of
the Borrower or any ERISA Affiliate has incurred or is likely to incur any
liability to or on account of a Plan under Section 409, 502(i), 502(l), 515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971
or 4975 of the Code or on account of a group health plan (as defined in Section
607(1) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the
Code, or the Borrower or any of its Subsidiaries has incurred or is likely to
incur liabilities pursuant to one or more employee welfare benefit plans (as
defined in Section 3(1) of ERISA) that provide benefits to retired employees or
other former employees (other than as required by Section 601 of ERISA) or Plans
or Foreign Pension Plans; (b) there shall result from any such event or events
the imposition of a lien, the granting of a security interest, or a liability or
a material risk of incurring a liability; and (c) such lien, security interest
or liability, individually, and/or in the aggregate, in the opinion of the
Required Banks, has had, or could reasonably be expected to have, a material
adverse effect upon the business, operations, condition (financial or otherwise)
or prospects of the Borrower or any of its Subsidiaries; or
9.07 SECURITY DOCUMENTS. Any Security Document shall cease to
be in full force and effect or, except as expressly set forth in the Security
Agreement, shall cease to give the Collateral Agent any perfected Lien
encumbering Collateral (other than in respect of a DI MINIMIS portion of
Collateral), or shall cease to give the Collateral Agent any material rights,
powers and privileges
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purported to be created thereby in favor of the Collateral Agent or any Credit
Party shall default in the due performance or observance of any term, covenant
or agreement on its part to be performed or observed pursuant to any such
Security Document and such default shall continue unremedied for a period of 30
days after notice to the Borrower by the Administrative Agent or the Required
Banks; or
9.08 SUBSIDIARY GUARANTY. The Subsidiary Guaranty or any
provision thereof shall cease to be in full force or effect, or any Subsidiary
Guarantor or any Person acting by or on behalf of any Subsidiary Guarantor shall
deny or disaffirm such guarantor's obligations under such Subsidiary Guaranty or
any Subsidiary Guarantor shall default in the due performance or observance of
any term, covenant or agreement on its part to be performed or observed pursuant
to the Subsidiary Guaranty; or
9.09 JUDGMENTS. One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving a liability of
$1,500,000 or more in the case of any one such judgment or decree and $2,500,000
or more in the aggregate for all such judgments and decrees for the Borrower and
its Subsidiaries (in each case, not paid or to the extent not covered by
insurance) and any such judgments or decrees shall not have been vacated,
discharged or stayed or bonded pending appeal within 60 days from the entry
thereof; or
9.10 CHANGE OF CONTROL. A Change of Control shall occur; then,
and in any such event, and at any time thereafter, if any Event of Default shall
then be continuing, the Administrative Agent shall, upon the written request of
the Required Banks, by written notice to the Borrower, take any or all of the
following actions, without prejudice to the rights of the Administrative Agent
or any Bank to enforce its claims against the Borrower, except as otherwise
specifically provided for in this Agreement (PROVIDED that, if an Event of
Default specified in Section 9.05 shall occur with respect to the Borrower, the
result which would occur upon the giving of written notice by the Administrative
Agent as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Total Commitment
terminated, whereupon the Commitment of each Bank shall forthwith terminate
immediately and any Commitment Commission shall forthwith become due and payable
without any other notice of any kind; (ii) declare the principal of and any
accrued interest in respect of all Loans and all Obligations owing hereunder
(including Unpaid Drawings) and thereunder to be, whereupon the same shall
become, forthwith due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower; (iii)
enforce, as Collateral Agent (or direct the Collateral Agent to enforce), any or
all of the Liens and security interests created pursuant to the Security
Documents; (iv) terminate any Letter of Credit which may be terminated in
accordance with its terms; (v) direct the Borrower to pay (and the Borrower
hereby agrees upon receipt of such notice, or upon the occurrence of any Event
of Default specified in Section 9.05 in respect of the Borrower, it will pay) to
the Collateral Agent at the Payment Office such additional amounts of cash, to
be held as security for the Borrower's reimbursement obligations in respect of
Letters of Credit then outstanding equal to the aggregate Stated Amount of all
Letters of Credit then outstanding; and (vi) apply any cash collateral held
pursuant to this Agreement to repay the Obligations.
SECTION 10. DEFINITIONS. As used herein, the following terms
shall have the
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meanings herein specified unless the context otherwise requires (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"Acquired Business" shall have the meaning provided in the
definition of Acquisition.
"Acquisition" shall mean the Borrower's acquisition of
substantially all of the assets of Mallinckrodt that are used by Mallinckrodt's
TRIMET Technical Products Division in manufacturing, marketing and supplying
Dimethylolpropionic Acid, Trimethylolethane, Formaldehyde and Calcium Formate
(the "Acquired Business") pursuant to the Asset Purchase Agreement, dated as of
June 29, 1998, between the Borrower and Mallinckrodt (the "Acquisition
Agreement").
"Acquisition Agreement" shall have the meaning provided in the
definition of Acquisition.
"Acquisition Documents" shall mean the Acquisition Agreement
and all other documents entered into or delivered in connection with the
Acquisition Agreement.
"Additional Mortgage" shall have the meaning provided in
Section 7.11(a).
"Additional Mortgaged Property" shall have the meaning
provided in Section 7.11(a).
"Adjusted Certificate of Deposit Rate" shall mean, on any day,
the sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by
dividing (x) the most recent weekly average dealer offering rate for negotiable
certificates of deposit with a three-month maturity in the secondary market as
published in the most recent Federal Reserve System publication entitled "Select
Interest Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Administrative Agent on the basis of quotations
for such certificates received by it from three certificate of deposit dealers
in New York of recognized standing or, if such quotations are unavailable, then
on the basis of other sources reasonably selected by the Administrative Agent,
by (y) a percentage equal to 100% minus the stated maximum rate of all reserve
requirements as specified in Regulation D applicable on such day to a
three-month certificate of deposit of a member bank of the Federal Reserve
System in excess of $100,000 (including, without limitation, any marginal,
emergency, supplemental, special or other reserves), plus (2) the then daily net
annual assessment rate as estimated by the Administrative Agent for determining
the current annual assessment payable by the Administrative Agent to the Federal
Deposit Insurance Corporation for insuring three-month certificates of deposit.
"Adjusted RC Percentage" shall mean (x) at a time when no Bank
Default exists, for each Bank such Bank's Revolving Percentage and (y) at a time
when a Bank Default exists (i) for each Bank that is a Defaulting Bank, zero and
(ii) for each Bank that is a Non-Defaulting Bank, the percentage determined by
dividing such Bank's Revolving Loan Commitment at such time by the Adjusted
Total Revolving Loan Commitment at such time, it being understood that all
references herein to Revolving Loan Commitments and the Adjusted Total Revolving
Loan Commitment at a time when the Total Revolving Loan Commitment or Adjusted
Total Revolving Loan Commitment, as the case may be, has been terminated shall
be references to the Revolving Loan Commitments or Adjusted Total Revolving Loan
Commitment, as the case may be, in effect
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immediately prior to such termination, PROVIDED that (A) no Bank's Adjusted RC
Percentage shall change upon the occurrence of a Bank Default from that in
effect immediately prior to such Bank Default if, after giving effect to such
Bank Default and any repayment of Revolving Loans and Swingline Loans at such
time pursuant to Section 4.02(A)(a) or otherwise, the sum of (i) the aggregate
outstanding principal amount of Revolving Loans of all Non-Defaulting Banks plus
(ii) the aggregate outstanding principal amount of Swingline Loans plus (iii)
the Letter of Credit Outstandings, exceeds the Adjusted Total Revolving Loan
Commitment, (B) the changes to the Adjusted RC Percentage that would have become
effective upon the occurrence of a Bank Default but that did not become
effective as a result of the preceding clause (A) shall become effective on the
first date after the occurrence of the relevant Bank Default on which the sum of
(i) the aggregate outstanding principal amount of the Revolving Loans of all
Non-Defaulting Banks plus (ii) the aggregate outstanding principal amount of the
Swingline Loans plus (iii) the Letter of Credit Outstandings is equal to or less
than the Adjusted Total Revolving Loan Commitment and (C) if (i) a
Non-Defaulting Bank's Adjusted RC Percentage is changed pursuant to the
preceding clause (B) and (ii) any repayment of such Bank's Revolving Loans, or
of Unpaid Drawings with respect to Letters of Credit or of Swingline Loans, that
were made during the period commencing after the date of the relevant Bank
Default and ending on the date of such change to its Adjusted RC Percentage must
be returned to any Borrower as a preferential or similar payment in any
bankruptcy or similar proceeding of such Borrower, then the change to such
Non-Defaulting Bank's Adjusted RC Percentage effected pursuant to said clause
(B) shall be reduced to that positive change, if any, as would have been made to
its Adjusted RC Percentage if (x) such repayments had not been made and (y) the
maximum change to its Adjusted RC Percentage would have resulted, in the sum of
the outstanding principal of Revolving Loans made by such Bank plus such Bank's
new Adjusted RC Percentage of the outstanding principal amount of Swingline
Loans and of Letter of Credit Outstandings equalling such Bank's Revolving Loan
Commitment at such time.
"Adjusted Total Revolving Loan Commitment" shall mean at any
time the Total Revolving Loan Commitment less the aggregate Revolving Loan
Commitments of all Defaulting Banks.
"Administrative Agent" shall have the meaning provided in the
first paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to Section 11.09.
"Affected Eurodollar Loans" shall have the meaning provided in
Section 4.02(c).
"Affiliate" shall mean, with respect to any Person, any other
Person directly or indirectly controlling (including, but not limited to, all
directors and officers of such Person), controlled by, or under direct or
indirect common control with such Person. A Person shall be deemed to control a
corporation if such Person possesses, directly or indirectly, the power (i) to
vote 5% or more of the securities having ordinary voting power for the election
of directors of such corporation or (ii) to direct or cause the direction of the
management and policies of such corporation, whether through the ownership of
voting securities, by contract or otherwise.
"Agreement" shall mean this credit agreement, as the same may
be from time to time modified, amended and/or supplemented.
"Anticipated Reinvestment Amount" shall mean, with respect to
any Reinvestment
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Election, the amount specified in the Reinvestment Notice delivered by the
Borrower in connection therewith as the amount of the Net Cash Proceeds from the
related Asset Sale that the Borrower and/or the Subsidiary Guarantors intend to
use to purchase, construct or otherwise acquire Reinvestment Assets.
"Approved Bank" shall have the meaning provided in the
definition of Cash Equivalents.
"Approved Company" shall have the meaning provided in the
definition of Cash Equivalents.
"Asset Sale" shall mean the sale, transfer or other
disposition by the Borrower or any Subsidiary of the Borrower to any Person
other than the Borrower or any Subsidiary Guarantor of any asset of the Borrower
or such Subsidiary (other than sales, transfers or other dispositions (x) in the
ordinary course of business of inventory and/or obsolete or excess equipment or
intellectual property pursuant to 8.02(e) or (k) or (y) the cash proceeds
(and/or fair market value of assets received in exchange therefor) of which do
not exceed $500,000.
"Assignment Agreement" shall have the meaning provided in
Section 12.04(b).
"Authorized Officer" shall mean any senior officer of the
Borrower designated as such in writing to the Administrative Agent by the
Borrower in each case to the extent acceptable to the Administrative Agent.
"Bank" shall have the meaning provided in the first paragraph
of this Agreement.
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any incurrence of
Revolving Loans (including pursuant to a Mandatory Borrowing) or to fund its
portion of any unreimbursed payment under Section 2.05(c) or (ii) a Bank having
notified the Administrative Agent and/or the Borrower that it does not intend to
comply with its obligations under Section 1.01 or under Section 2.05(c), in the
case of either (i) or (ii) as a result of the appointment of a receiver or
conservator with respect to such Bank at the direction or request of any
regulatory agency or authority.
"Bankruptcy Code" shall have the meaning provided in Section
9.05.
"Base Rate" at any time shall mean the higher of (i) the rate
which is 1/2 of 1% in excess of the Adjusted Certificate of Deposit Rate and
(ii) the Prime Lending Rate.
"Base Rate Loan" shall mean each Loan bearing interest at the
rates provided in Section 1.08(a).
"Base Rate Margin" shall mean 1.25%.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"Borrowing" shall mean the incurrence of (i) Swingline Loans
by the Borrower from the Swingline Bank on a given date or (ii) one Type of
Revolving Loan by the Borrower from all of the Banks on a PRO RATA basis on a
given date (or resulting from conversions on a given date),
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having in the case of Eurodollar Loans the same Interest Period; PROVIDED that
Base Rate Loans incurred pursuant to Section 1.10(b) shall be considered part of
any related Borrowing of Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and any day
which shall be in the City of New York a legal holiday or a day on which banking
institutions are authorized by law or other governmental actions to close and
(ii) with respect to all notices and determinations in connection with, and
payments of principal and interest on, Eurodollar Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Eurodollar market.
"Capital Lease" as applied to any Person shall mean any lease
of any property (whether real, personal or mixed) by that Person as lessee
which, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations
under Capital Leases of the Borrower or any of its Subsidiaries in each case
taken at the amount thereof accounted for as liabilities in accordance with
GAAP.
"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 six months from the date of acquisition, (ii) U.S. dollar
denominated time deposits, certificates of deposit and bankers' acceptances of
(x) any Bank, (y) any domestic commercial bank of recognized standing having
capital and surplus in excess of $500,000,000 or (z) any bank (or the parent
company of such bank) whose short-term commercial paper rating from Standard &
Poor's Ratings Services ("S&P") is at least A-1 or the equivalent thereof or
from ▇▇▇▇▇'▇ Investors Service, Inc. ("▇▇▇▇▇'▇") is at least P-1 or the
equivalent thereof (any such bank, an "Approved Bank"), in each case with
maturities of not more than six months from the date of acquisition, (iii)
repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clause (i) above entered into with any bank
meeting the qualifications specified in clause (ii) above, (iv) commercial paper
issued by any Bank or Approved Bank or by the parent company of any Bank or
Approved Bank and commercial paper issued by, or guaranteed by, any industrial
or financial company with a short-term commercial paper rating of at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's (any such company, an "Approved Company"), or guaranteed by any
industrial company with a long term unsecured debt rating of at least A or A2,
or the equivalent of each thereof, from S&P or Moody's, as the case may be, and
in each case maturing within six months after the date of acquisition and (v)
investments in money market funds substantially all of whose assets are
comprised of securities of the type described in clauses (i) through (iv) above.
"Cash Proceeds" shall mean, with respect to any Asset Sale,
the aggregate cash payments (including any cash received by way of deferred
payment pursuant to a note receivable issued in connection with such Asset Sale,
other than the portion of such deferred payment constituting interest, but only
as and when so received) received by the Borrower and/or any
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Subsidiary from such Asset Sale.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 ET
SEQ.
"Change of Control" shall mean (A) (a) prior to the Borrower's
initial public offering of common stock, the Permitted Holders cease to be the
"beneficial owner" (as defined in Rules 13d- 3 and 13d-5 under the Exchange
Act), directly or indirectly, of a majority in the aggregate of the total voting
power of the Voting Stock of the Borrower, whether as a result of the issuance
of securities of the Borrower, any merger, consolidation, liquidation or
dissolution of the Borrower, any direct or indirect transfer of securities or
otherwise (for purposes of this clause (a) and clause (b) below, the Permitted
Holders shall be deemed to beneficially own any Voting Stock of a corporation
(the "specified corporation") held by any other corporation (the "parent
corporation") so long as the Permitted Holders beneficially own (as so defined),
directly or indirectly (through Wholly-Owned Subsidiaries that are not operating
businesses), in the aggregate a majority of the voting power of the Voting Stock
of the parent corporation), (b) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders,
is or becomes the beneficial owner (as defined in clause (a) above, except that
a person shall be deemed to have "beneficial ownership" of all shares that any
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of more
than 30% of the total voting power of the Voting Stock of the Borrower;
PROVIDED, that the Permitted Holders "beneficially own" (as defined in clause
(a) above), directly or indirectly, in the aggregate a lesser percentage of the
total voting power of the Voting Stock of the Borrower than such other person
and do not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors of the
Borrower (for the purposes of this clause (b) such other person shall be deemed
to beneficially own any Voting Stock of a specified corporation held by a parent
corporation, if such other person "beneficially owns" (as defined in this clause
(b)), directly or indirectly, more than 30% of the voting power of the Voting
Stock of such parent corporation and the Permitted Holders "beneficially own"
(as defined in clause (a) above), directly or indirectly, in the aggregate a
lesser percentage of the voting power of the Voting Stock of such parent
corporation and do not have the right or ability by voting power, contract or
otherwise to elect or designate for election a majority of the Board of
Directors of such parent corporation), or (c) during any period of two
consecutive years individuals who at the beginning of such period constituted
the Board of Directors of the Borrower (together with any new directors whose
election by such Board of Directors or whose nomination for election by the
stockholders of the Borrower was approved by either (i) the Permitted Holders or
(ii) a vote of a majority of the directors of the Borrower then still in office
who were either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors of the Borrower then in office;
or (B) the occurrence of a Senior Subordinated Notes Change of Control.
"Charter Oak" shall mean Charter Oak Partners, a Connecticut
limited partnership and Charter Oak Capital Partners, a Connecticut limited
partnership.
"Charter Oak Warrant Agreement" shall mean the Warrant
Agreement, dated as of March 25, 1997, between the Borrower and Charter Oak, as
amended through the date hereof.
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"▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇" shall mean the Warrants issued to
Charter Oak pursuant to the Charter Oak Warrant Agreement.
"Class A Common Stock" shall mean the Borrower's Class A
voting common stock, par value $1.00 per share.
"Class B Common Stock" shall mean the Borrower's Class B
non-voting common stock, par value $1.00 per share.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code, as in effect at the
date of this Agreement and any subsequent provisions of the Code, amendatory
thereof, supplemental thereto or substituted therefor.
"Collateral" shall mean all of the Collateral as defined in
each of the Security Documents.
"Collateral Agent" shall mean the Administrative Agent acting
as collateral agent for the Banks pursuant to the Security Documents.
"Collective Bargaining Agreements" shall have the meaning
provided in Section 5.06(vi).
"Commitment Commission" shall have the meaning provided in
Section 3.01(a).
"Common Management Fund" shall mean with respect to any
Person, a fund under common control with such Person.
"Consolidated Capital Expenditures" shall mean, for any
period, the aggregate of all expenditures (whether paid in cash or accrued as
liabilities and including in all events all amounts expended or capitalized
under Capital Leases but excluding any amount representing capitalized interest)
by the Borrower and its Subsidiaries during that period that, in conformity with
GAAP, are or are required to be included in the property, plant or equipment
reflected in the consolidated balance sheet of the Borrower and its
Subsidiaries.
"Consolidated EBIT" shall mean, for any period, (A) the sum of
the amounts for such period of (i) Consolidated Net Income, (ii) provisions for
taxes based on income, (iii) Consolidated Net Interest Expense, (iv)
amortization or write-off of deferred financing costs to the extent deducted in
determining Consolidated Net Income and (v) losses on sales of assets (excluding
sales in the ordinary course of business) and other extraordinary or
nonrecurring losses LESS (B) the amount for such period of gains on sales of
assets (excluding sales in the ordinary course of business) and other
extraordinary or nonrecurring gains, all as determined on a consolidated basis
in accordance with GAAP.
"Consolidated EBITDA" shall mean, for any period, the sum of
the amounts for such period of (i) Consolidated EBIT, (ii) depreciation expense
for the Borrower and its Subsidiaries, (iii) amortization expense for the
Borrower and its Subsidiaries and (iv) depletion and all other non-cash charges
included in Consolidated Net Income during such period, all as determined on a
consolidated
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basis in accordance with GAAP.
"Consolidated Indebtedness" shall mean, as at any date of
determination, the aggregate amount of all Indebtedness of the Borrower and its
Subsidiaries on a consolidated basis.
"Consolidated Net Indebtedness" shall mean, at any date of
determination, an amount equal to the amount of Consolidated Indebtedness at
such time less the amount of cash and Cash Equivalents held by the Borrower and
its Subsidiaries at such time.
"Consolidated Net Interest Expense" shall mean, for any
period, (A) total interest expense (including that attributable to Capital
Leases in accordance with GAAP) of the Borrower and its Subsidiaries on a
consolidated basis with respect to all outstanding Indebtedness of the Borrower
and its Subsidiaries, including, without limitation, all capitalized interest,
commitment commissions and agency fees, but excluding (x) all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing and net costs under Interest Rate Agreements and
(y) Transaction Expenses less (B) the total interest income of the Borrower and
its Subsidiaries on a consolidated basis.
"Consolidated Net Income" shall mean, for any period, the net
income (or loss) of the Borrower and its Subsidiaries on a consolidated basis
for such period taken as a single accounting period determined in conformity
with GAAP, PROVIDED that there shall be excluded (i) the income (or loss) of any
Person (other than Subsidiaries of the Borrower) in which any other Person
(other than the Borrower or any of its Subsidiaries) has a joint interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of its Subsidiaries by such Person during such
period, (ii) the income (or loss) of any Person accrued prior to the date it
becomes a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any of its Subsidiaries or that Person's assets are acquired by the
Borrower or any of its Subsidiaries, (iii) the income of any Subsidiary of the
Borrower to the extent that the declaration or payment of dividends or similar
distributions by that Subsidiary of that income is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary, (iv) Transaction Expenses, (v) compensation expense resulting from
the issuance of capital stock, stock options or stock appreciation rights issued
to former or current employees, including officers, of the Borrower or any
Subsidiary of the Borrower, or the exercise of such options or rights, in each
case to the extent the obligation (if any) associated therewith is not expected
to be settled by the payment of cash by the Borrower or any Affiliate of the
Borrower and (vi) compensation expense resulting from the repurchase of capital
stock, options and rights described in clause (v) of this definition of
Consolidated Net Income.
"Contingent Obligations" shall mean, as to any Person, any
obligation of such Person guaranteeing or intending to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (a) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance or
supply funds (i) for the purchase or payment of any such primary obligation or
(ii) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or
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services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of such primary
obligation against loss in respect thereof; PROVIDED, that the term Contingent
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Bank" shall mean each Existing Bank with a
Revolving Loan Commitment under this Agreement.
"Credit Documents" shall mean this Agreement, each of the
Notes, each of the Security Documents, the Security Documents Acknowledgment,
the Subsidiary Guaranty and any other documents executed in connection with any
of the foregoing.
"Credit Event" shall mean and include the making of a Loan or
the issuance of a Letter of Credit.
"Credit Party" shall mean the Borrower and the Subsidiary
Guarantors.
"CSE Warrant Agreement" shall mean the Warrant Agreement,
dated as of March 25, 1997, between the Borrower and Chemical Specialties
Enterprises, L.P.
"CSE Warrants" shall mean the Warrants issued to Chemical
Specialties Enterprises, L.P. pursuant to the CSE Warrant Agreement.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a
Bank Default is in effect.
"Dividends" shall have the meaning provided in Section 8.08.
"Documents" shall mean, collectively, (a) the Credit Documents
and (b) the Transaction Documents.
"Eligible Transferee" shall mean and include a commercial
bank, financial institution or other "accredited investor" (as defined by
Regulation D of the Securities Act of 1933).
"Employment Agreements" shall have the meaning provided in
Section 5.06(v).
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, administrative investigations or
proceedings relating in any way to any violation of or any liability under any
Environmental Law or any permit issued, or under any approval given, under any
such Environmental Law (hereafter, "Claims"), including, without limitation, (a)
any and all Claims by
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governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (b) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials arising from alleged injury
or threat of injury to health, safety or the environment.
"Environmental Law" shall mean any applicable Federal, state,
foreign or local statute, law, rule, regulation, ordinance, code, rule of common
law or written and binding policy or guide, now or hereafter in effect and in
each case as amended, and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to the environment, health, safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, as
amended, 33 U.S.C. Section 1251 ET SEQ.; the Toxic Substances Control Act, 15
U.S.C. Section 7401 ET SEQ.; the Clean Air Act, 42 U.S.C. Section 7401 ET SEQ.;
the Safe Drinking Water Act, 42 U.S.C. Section 3808 ET SEQ.; the Oil Pollution
Act of 1990, 33 U.S.C. Section 2701 ET SEQ.; and any applicable state and local
or foreign counterparts or equivalents.
"Equity Financing" shall have the meaning provided in Section
5.12.
"Equity Financing Documents" shall have the meaning provided
in Section 5.12.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of this Agreement and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with the Borrower or a Subsidiary of the
Borrower would be deemed to be a "single employer" (i) within the meaning of
Section 414(b), (c), (m) or (o) of the Code or (ii) as a result of
the Borrower or a Subsidiary of the Borrower being or having been a general
partner of such person.
"Eurodollar Loans" shall mean each Loan bearing interest at
the rates provided in Section 1.08(b).
"Eurodollar Margin" shall mean 2.25%.
"Eurodollar Rate" shall mean with respect to each Interest
Period for a Eurodollar Loan, (i) the offered quotation to first-class banks in
the New York interbank Eurodollar market by the Administrative Agent for dollar
deposits of amounts in same day funds comparable to the outstanding principal
amount of the Eurodollar Loan for which an interest rate is then being
determined with maturities comparable to the Interest Period to be applicable to
such Eurodollar Loan, determined as of 10:00 A.M. (New York time) on the date
which is two Business Days prior to the commencement of such Interest Period
divided (and rounded upward to the next whole multiple of 1/16 of 1%) by (ii) a
percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency liabilities as defined in
Regulation D (or any successor category of liabilities under Regulation D).
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"Event of Default" shall have the meaning provided in Section
9.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.
"Existing Bank" shall mean each Person which was a "Bank"
under, and as defined in, the Existing Credit Agreement immediately prior to the
Restatement Effective Date.
"Existing Credit Agreement" shall have the meaning provided in
the recitals to this Agreement.
"Existing Letter of Credit" shall have the meaning provided in
Section 2.01(a) of this Agreement.
"Existing Loans" shall mean all "Loans" under, and as defined
in the Existing Credit Agreement.
"Existing Mortgage" shall have the meaning provided in Section
5.16.
"Existing Mortgage Amendments" shall have the meaning provided
in Section 5.16.
"Existing Indebtedness" shall have the meaning provided in
Section 6.21.
"Existing Indebtedness Agreements" shall have the meaning
provided in Section 5.06(ii).
"Facing Fee" shall have the meaning provided in Section
3.01(c).
"Federal Funds Effective Rate" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to, or referred
to in, Section 3.01.
"FIRREA" shall mean Financial Institution Reform, Recovery and
Enforcement Act of 1989.
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect on the date of this Agreement; it
being understood and agreed that determinations in accordance with GAAP for
purposes of Section 8, including defined terms as used therein, are subject (to
the extent provided therein) to Section 12.07(a).
"GEO Shareholders' Agreement" shall mean the Shareholders
Agreement, dated as of March 25, 1997, among the Borrower, Charter Oak, Chemical
Specialties Enterprises, L.P.,
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as amended through the date hereof.
"Hazardous Materials" shall mean (a) any petroleum or
petroleum products, radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; (b) any chemicals, materials or substances defined as
or included in the definition of "hazardous substances," "hazardous waste,"
"hazardous materials," "extremely hazardous waste," "restricted hazardous
waste," "toxic substances," "toxic pollutants," "contaminants," or "pollutants,"
or words of similar meaning and regulatory effect, under any applicable
Environmental Law; and (c) any other chemical, material or substance, exposure
to which is prohibited, limited or regulated by any governmental authority.
"Indebtedness" of any Person shall mean, without duplication,
(i) all indebtedness of such Person for borrowed money, (ii) the deferred
purchase price of assets or services which in accordance with GAAP would be
shown on the liability side of the balance sheet of such Person, (iii) the face
amount of all letters of credit issued for the account of such Person and,
without duplication, all drafts drawn thereunder, (iv) all Indebtedness of a
second Person secured by any Lien on any property owned by such first Person,
whether or not such indebtedness has been assumed, (v) all Capitalized Lease
Obligations of such Person, (vi) all obligations of such Person to pay a
specified purchase price for goods or services whether or not delivered or
accepted, I.E., take-or-pay and similar obligations, (vii) all net obligations
of such Person under Interest Rate Agreements and (viii) all Contingent
Obligations of such Person, (other than Contingent Obligations arising from the
guaranty by such Person of the obligations of the Borrower and/or its
Subsidiaries to the extent such guaranteed obligations do not constitute
Indebtedness), PROVIDED that Indebtedness shall not include trade payables,
deferred revenue, taxes and accrued expenses, in each case arising in the
ordinary course of business.
"Information Systems and Equipment" shall mean all computer
hardware, firmware and software, as well as other information processing
systems, or any equipment containing embedded microchips, whether directly
owned, licensed, leased, operated or otherwise controlled by the Borrower or any
of its Subsidiaries, including through third-party service providers, and which,
in whole or in part, are used, operated, relied upon, or integral to, the
Borrower's or any of its Subsidiaries' conduct of their business.
"Interest Coverage Ratio" shall mean, for any Test Period, the
ratio of (i) Consolidated EBITDA for such Test Period to (ii) Consolidated Net
Interest Expense for such Test Period.
"Interest Period" with respect to any Eurodollar Loan shall
mean the interest period applicable thereto, as determined pursuant to Section
1.09.
"Interest Rate Agreement" shall mean any interest rate swap
agreement, any interest rate cap agreement, any interest rate collar agreement
or other similar agreement or arrangement designed to hedge the position of the
Borrower or any Subsidiary with respect to interest rates.
"L/C Supportable Obligations" shall mean (i) obligations of
the Borrower or its Subsidiaries incurred in the ordinary course of business
with respect to insurance obligations and workers' compensation, surety bonds
and other similar statutory obligations (including taxes,
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licenses and other similar requirements) and (ii) such other obligations of the
Borrower or any of its Subsidiaries as are permitted to exist pursuant to the
terms of this Agreement.
"Leasehold" of any Person shall mean all of the right, title
and interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 3.01(b).
"Letter of Credit Issuer" shall mean BTCo and any other Bank
which at the request of the Borrower and with the consent of the Administrative
Agent agrees, in such Bank's sole discretion, to become a Letter of Credit
Issuer for purposes of issuing Letters of Credit pursuant to Section 2.
"Letter of Credit Outstandings" shall mean, at any time, the
sum of, without duplication, (i) the aggregate Stated Amount of all outstanding
Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings in
respect of all Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in
Section 2.03(a).
"Leverage Ratio" shall mean, at any date of determination, the
ratio of (i) Consolidated Net Indebtedness on such date to (ii) Consolidated
EBITDA for the Test Period most recently ended (taken as one accounting period)
provided that in the case of a Test Period ended before the first anniversary of
the Restatement Effective Date, for purposes of the Leverage Ratio only,
Consolidated EBITDA for such Test Period shall be multiplied by a fraction the
numerator of which is 365 and the denominator of which is the number of days
actually elapsed during the respective Test Period.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement or any
lease in the nature thereof).
"Loan" shall mean each Revolving Loan and each Swingline Loan.
"Mallinckrodt" shall mean Mallinckrodt Inc., a New York
corporation and Mallinckrodt Inc., a Delaware corporation.
"Management Agreements" shall have the meaning provided in
Section 5.06(iv).
"Mandatory Borrowing" shall have the meaning provided in
Section 1.01(c).
"Margin Stock" shall have the meaning provided in Regulation
U.
"Material Adverse Effect" shall mean a material adverse effect
on the business, property, assets, liabilities, operations, condition (financial
or otherwise) or prospects of the Borrower or of the Borrower and its
Subsidiaries taken as a whole, after giving effect to the Transaction.
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"Maturity Date" shall mean July 31, 2003.
"Maximum Swingline Amount" shall mean $1,000,000.
"Minimum Borrowing Amount" shall mean (i) for Revolving Loans
maintained as Base Rate Loans, $250,000 and (ii) for Revolving Loans maintained
as Eurodollar Loans, $500,000.
"▇▇▇▇▇'▇" shall have the meaning provided in the definition of
Cash Equivalents.
"Mortgage" shall mean and include each New Mortgage and each
Existing Mortgage, PROVIDED that after the execution and delivery thereof, each
Additional Mortgage shall also constitute a Mortgage.
"Mortgage Policies" shall mean and include each New Mortgage
Policy and each Existing Mortgage Policy.
"Mortgaged Properties" shall mean each of the Real Properties
listed on Annex VIII hereto and designated either as a "New Mortgage Property"
or "Existing Mortgaged Property" thereon and, after the execution and delivery
of any Additional Mortgage, shall include the respective Additional Mortgaged
Property.
"Multiemployer Plan" shall have the meaning provided in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" shall mean, with respect to any Asset
Sale, the Cash Proceeds resulting therefrom net of expenses of sale (including
payment of principal, premium and interest of other Indebtedness secured by the
assets that were the subject of the Asset Sale and required to be, and which is,
repaid under the terms thereof as a result of such Asset Sale, commissions,
reasonable costs, attorneys' fees and accountants' fees), and incremental taxes
paid or payable as a result thereof; PROVIDED that Net Cash Proceeds shall not
include cash deposited with the Administrative Agent pursuant to a cash
collateral arrangement pursuant to this Agreement.
"New Bank" shall mean each Bank on the Restatement Effective
Date which is not an Existing Bank.
"New Mortgages" shall have the meaning provided in Section
5.15.
"New Mortgage Policies" shall have the meaning provided in
Section 5.15.
"New Mortgaged Property" shall have the meaning provided in
Section 5.15.
"Non-Continuing Bank" shall mean any Existing Bank which does
not have a Revolving Loan Commitment under this Agreement.
"Non-Defaulting Bank" shall mean each Bank other than a
Defaulting Bank.
"Note" shall mean and include each Revolving Note and the
Swingline Note.
"Notice of Borrowing" shall mean any written notice of
Borrowing delivered pursuant
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to Section 1.03(a) or 1.03(b).
"Notice of Conversion" shall have the meaning provided in
Section 1.06.
"Notice Office" shall mean the office of the Administrative
Agent located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ or such other office as
the Administrative Agent may designate to the Borrower from time to time.
"Obligations" shall mean all amounts, direct or indirect,
contingent or absolute, of every type or description, and at any time existing,
owing to the Administrative Agent, the Collateral Agent or any Bank pursuant to
the terms of this Agreement or any other Credit Document.
"Participant" shall have the meaning provided in Section
2.05(a).
"Payment Office" shall mean the office of the Administrative
Agent located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ or such other office as
the Administrative Agent may designate to the Borrower from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in
Section 8.02(m).
"Permitted Business" shall mean any line of business in which
the Borrower and its Subsidiaries are permitted to engage under Section 8.01.
"Permitted Encumbrances" shall mean, with respect to any Real
Property subject to a Mortgage or an Additional Mortgage, such exceptions to
title as are set forth in the title insurance policy or title commitment
delivered with respect thereto, all of which exceptions must be reasonably
acceptable to the Administrative Agent.
"Permitted Holders" shall mean ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, and the holders of the capital stock of the
Borrower on the Restatement Effective Date (after giving effect to the
Transaction).
"Permitted Liens" shall have the meaning provided in Section
8.03.
"Person" shall mean any individual, partnership, joint
venture, firm, corporation, limited liability company, association, trust or
other enterprise or any government or political subdivision or any agency,
department or instrumentality thereof.
"Plan" shall mean any pension plan as defined in Section 3(2)
of ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower, a Subsidiary of the Borrower or an
ERISA Affiliate, and each such plan for the five-year period immediately
following the latest date on which the Borrower, a Subsidiary of the Borrower,
or an ERISA Affiliate maintained, contributed to or had an obligation to
contribute to such plan.
"Pledge Agreement" shall have the meaning provided in the
Existing Credit Agreement.
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"Pledged Securities" shall mean all the Pledged Securities as
defined in the Pledge Agreement.
"Prime Lending Rate" shall mean the rate which BTCo announces
from time to time as its prime lending rate, the Prime Lending Rate to change
when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BTCo may make commercial loans or other loans
at rates of interest at, above or below the Prime Lending Rate.
"Projections" shall have the meaning set forth in Section
5.20.
"Quarterly Payment Date" shall mean the last Business Day of
March, June, September and December, occurring after the Restatement Effective
Date.
"RCRA" shall mean the Resource Conservation and Recovery Act,
as amended, 42 U.S.C. Section 6901 ET SEQ.
"Real Property" of any Person shall mean all of the right,
title and interest of such Person in and to land, improvements and fixtures,
including Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any
of its Subsidiaries of any cash insurance proceeds or condemnation award payable
(i) by reason of theft, loss, physical destruction or damage or any other
similar event with respect to any property or asset of the Borrower or any of
its Subsidiaries, or (ii) by reason of any condemnation, taking, seizing or
similar event with respect to any property or asset of the Borrower or any of
its Subsidiaries.
"Refinancing" shall have the meaning provided in Section 5.22.
"Register" shall have the meaning provided in Section 12.16.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
"Regulation T, U and X" shall mean Regulations T, U and X of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof establishing margin
requirements.
"Reinvestment Assets" shall mean any assets to be employed in
the business of the Borrower and its Subsidiaries as described in Sections
3.03(c) and 8.02(f).
"Reinvestment Election" shall have the meaning provided in
Section 3.03(c).
"Reinvestment Notice" shall mean a written notice signed by an
Authorized Officer of the Borrower stating that the Borrower, in good faith,
intends and expects to use all or a specified portion of the Net Cash Proceeds
of an Asset Sale to purchase, construct or otherwise acquire Reinvestment
Assets.
"Reinvestment Commitment Reduction Amount" shall mean, with
respect to any
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Reinvestment Election, the amount, if any, on the Reinvestment Commitment
Reduction Date relating thereto by which (a) the Anticipated Reinvestment Amount
in respect of such Reinvestment Election exceeds (b) the aggregate amount
thereof expended by the Borrower and its Subsidiaries to acquire Reinvestment
Assets.
"Reinvestment Commitment Reduction Date" shall mean, with
respect to any Reinvestment Election, the earliest of (i) the date, if any, upon
which the Administrative Agent, on behalf of the Required Banks, shall have
delivered a written termination notice to the Borrower, provided that such
notice may only be given while an Event of Default exists, (ii) the date
occurring one year after such Reinvestment Election and (iii) the date on which
the Borrower shall have determined not to, or shall have otherwise ceased to,
proceed with the purchase, construction or other acquisition of Reinvestment
Assets with the related Anticipated Reinvestment Amount.
"Replaced Bank" shall have the meaning provided in Section
1.13.
"Replacement Bank" shall have the meaning provided in Section
1.13.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan that is subject to Title IV of ERISA
other than those events as to which the 30-day notice period is waived under
subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
"Required Appraisal" shall have the meaning provided in
Section 7.11(d).
"Required Banks" shall mean Non-Defaulting Banks whose
Revolving Loan Commitments (or, if after the termination thereof, outstanding
Revolving Loans and Adjusted RC Percentage of outstanding Swingline Loans and
Letter of Credit Outstandings) constitute greater than 50% of the Adjusted Total
Revolving Loan Commitment (or, if after the termination thereof, the sum of the
then total outstanding Revolving Loans of Non-Defaulting Banks and the aggregate
Adjusted RC Percentages of all Non-Defaulting Banks of the total outstanding
Swingline Loans and Letter of Credit Outstandings at such time).
"Restatement Effective Date" shall have the meaning provided
in Section 12.10.
"Revolving Loan" shall have the meaning provided in Section
1.01(a).
"Revolving Loan Commitment" shall mean, with respect to each
Bank, the amount set forth opposite such Bank's name in Annex I directly below
the column entitled "Revolving Loan Commitment," (x) as the same may be reduced
from time to time pursuant to Sections 3.02, 3.03 and/or 9 or (y) adjusted from
time to time as a result of assignments to or from such Bank pursuant
to Section 12.04.
"Revolving Note" shall have the meaning provided in Section
1.05(a)(i).
"Revolving Percentage" shall mean at any time for each Bank,
the percentage obtained by dividing such Bank's Revolving Loan Commitment by the
Total Revolving Loan Commitment, PROVIDED that if the Total Revolving Loan
Commitment has been terminated, the Revolving Percentage of each Bank shall be
determined by dividing such Bank's Revolving Loan Commitment immediately prior
to such termination by the Total Revolving Loan
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Commitment immediately prior to such termination.
"S&P" shall have the meaning provided in the definition of
Cash Equivalents.
"SEC" shall mean the Securities and Exchange Commission and
any successor thereto.
"Section 4.04(b)(ii) Certificate" shall have the meaning
provided in Section 4.04(b)(ii).
"Security Agreement" shall have the meaning provided in the
Existing Credit Agreement.
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Security Agreement.
"Security Documents" shall mean the Pledge Agreement, the
Security Agreement, each Mortgage and each Additional Mortgage, if any.
"Security Documents Acknowledgment" shall have the meaning
provided in Section 5.14.
"Senior Subordinated Notes" shall mean the unsecured senior
subordinated notes, issued by the Borrower, as in effect on the Restatement
Effective Date and after giving effect to any changes, amendments or supplements
thereto (and shall include any unsecured senior subordinated notes into which
the Senior Subordinated Notes are exchanged pursuant to the Senior Subordinated
Notes Documents).
"Senior Subordinated Notes Change of Control" shall mean a
"Change of Control" under, and as defined in, the Senior Subordinated Notes
Indenture.
"Senior Subordinated Notes Documents" shall mean and include
each of the Senior Subordinated Notes, the Senior Subordinated Notes Indenture
and all securities purchase agreements and other documents and agreements
related thereto, as in effect on the Restatement Effective Date and after giving
effect to any changes, amendments or supplements thereto.
"Senior Subordinated Notes Indenture" shall mean the indenture
(which indenture shall be satisfactory to the Administrative Agent) dated on or
about the Restatement Effective Date, between the Borrower and a trustee, as in
effect on the Restatement Effective Date and after giving effect to any changes,
amendments or supplements thereto.
"Shareholders' Agreements" shall have the meaning provided in
Section 5.06(iii).
"Standby Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Stated Amount" of each Letter of Credit shall mean the
maximum amount available to be drawn thereunder (regardless of whether any
conditions for drawing could then be met).
"Subsidiary" of any Person shall mean and include (i) any
corporation more than 50%
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of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to "Subsidiary" shall mean a
Subsidiary of the Borrower.
"Subsidiary Guarantors" shall mean each Subsidiary of the
Borrower incorporated in the United States or any State thereof.
"Subsidiary Guaranty" shall mean the Subsidiary Guaranty in
the form of Exhibit G (appropriately completed), and, after the execution and
delivery thereof, as modified, supplemented or amended from time to time.
"Swingline Bank" shall mean BTCo and its successors and
assigns.
"Swingline Expiry Date" shall mean the date which is five
Business Days prior to the Maturity Date.
"Swingline Loan" shall have the meaning provided in Section
1.01(b).
"Swingline Note" shall have the meaning provided in Section
1.05(a)(ii).
"Tax Sharing Agreement" shall have the meaning provided in
Section 5.06(vii).
"Taxes" shall have the meaning provided in Section 4.04(a).
"Test Period" shall mean each period of four consecutive
fiscal quarters of the Borrower (or, if shorter, the period beginning on the
Restatement Effective Date and ending on the last day of a fiscal quarter of the
Borrower ended after the Restatement Effective Date), in each case taken as one
accounting period, ended after the Restatement Effective Date.
"Total Revolving Loan Commitment" shall mean the sum of the
Revolving Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at
any time, (i) the Total Revolving Loan Commitment at such time less (ii) the sum
of the aggregate principal amount of all Revolving Loans and Swingline Loans
outstanding at such time plus the Letter of Credit Outstandings at such time.
"Trade Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Transaction" shall mean, collectively, (i) the Refinancing,
(ii) the amendment and restatement of the Existing Credit Agreement in the form
of this Agreement, (iii) the issuance of the Senior Subordinated Notes and the
use of proceeds therefrom to repay all outstanding Existing Loans (together with
interest and accrued Fees (under and as defined in the Existing Credit
Agreement)), (iv) the consummation of the Acquisition, (v) the consummation of
the Equity Financing, (vi) the
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incurrence of Revolving Loans on the Restatement Effective Date and (vii) the
payment of all fees and expenses to be paid in connection with the foregoing.
"Transaction Documents" shall mean, collectively, (i) the
Acquisition Documents, (ii) the Senior Subordinated Notes Documents, (iii) the
Equity Financing Documents and (iv) all other documents and agreements (other
than the Credit Documents) entered into in connection with the Transaction.
"Transaction Expenses" shall mean all fees and expenses
incurred in connection with, and payable prior to or in connection with the
closing of, the Transaction including all fees paid to any of the Banks and the
Administrative Agent hereunder, attorney's fees, accountants' fees, placement
agents' fees, consultant fees, discounts and commissions and brokerage, and
employee relocation expenses. Transaction Expenses shall include the
amortization of any such fees and expenses that are capitalized and not
classified as an expense on the date incurred.
"Type" shall mean any type of Revolving Loan determined with
respect to the interest option applicable thereto, I.E., a Base Rate Loan or
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code, as in effect
from time to time in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the accumulated plan
benefits under the Plan as of the close of its most recent plan year, determined
in accordance with actuarial assumptions at such time consistent with Financial
Accounting Standards No. 87 exceeds the market value of the assets allocable
thereto, each determined in accordance with Statement of Financial Accounting
Standards No. 87.
"Unpaid Drawing" shall have the meaning provided in Section
2.04(a).
"Unutilized Revolving Loan Commitment" for any Bank with a
Revolving Loan Commitment at any time shall mean the excess of (i) the Revolving
Loan Commitment of such Bank over (ii) the sum of (x) the aggregate outstanding
principal amount of Revolving Loans made by such Bank plus (y) an aggregate
amount equal to such Bank's Adjusted RC Percentage of the Letter of Credit
Outstandings at such time.
"Voting Stock" shall mean any class or classes of capital
stock of the Borrower pursuant to which the holders thereof have the general
voting power under ordinary circumstances to elect at least a majority of the
Board of Directors of the Borrower.
"Warrant Agreements" shall mean, collectively, the CSE Warrant
Agreement and the Charter Oak Warrant Agreement.
"Warrants" shall mean, collectively, the CSE Warrants and the
Charter Oak Warrants.
"Wholly-Owned Domestic Subsidiary" shall mean each
Wholly-Owned Subsidiary of the Borrower that is incorporated under the laws of
the United States or any State thereof.
"Wholly-Owned Subsidiary" of any Person shall mean any
Subsidiary of such Person
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to the extent all of the capital stock or other ownership interests in such
Subsidiary, other than directors' qualifying shares, is owned directly or
indirectly by such Person.
"Written" or "in writing" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.
"Year 2000 Compliant" shall mean that all Information Systems
and Equipment accurately process date data (including, but not limited to,
calculating, comparing and sequencing), before, during and after the year 2000,
as well as same and multi-century dates, or between the years 1999 and 2000,
taking into account all leap years, including the fact that the year 2000 is a
leap year, and further, that when used in combination with, or interfacing with
other Information Systems and Equipment, shall accurately accept, release and
exchange date data, and shall in all material respects continue to function in
the same manner as it performs today and shall not otherwise impair the accuracy
or functionality of Information Systems and Equipment.
SECTION 11. THE ADMINISTRATIVE AGENT.
11.01 APPOINTMENT. The Banks hereby designate Bankers Trust
Company as Administrative Agent (for purposes of this Section 11, the term
"Administrative Agent" shall include BTCo in its capacity as Collateral Agent
pursuant to the Security Documents) to act as specified herein and in the other
Credit Documents. Each Bank hereby irrevocably authorizes, and each holder of
any Note by the acceptance of such Note shall be deemed irrevocably to
authorize, the Administrative Agent to take such action on its behalf under the
provisions of this Agreement, the other Credit Documents and any other
instruments and agreements referred to herein or therein and to exercise such
powers and to perform such duties hereunder and thereunder as are specifically
delegated to or required of the Administrative Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. The
Administrative Agent may perform any of its duties hereunder or under the other
Credit Documents by or through its respective officers, directors, agents,
employees or affiliates.
11.02 NATURE OF DUTIES. The Administrative Agent shall not
have any duties or responsibilities except those expressly set forth in this
Agreement and the Security Documents. Neither the Administrative Agent nor any
of its respective officers, directors, agents, employees or affiliates shall be
liable for any action taken or omitted by it or them hereunder or under any
other Credit Document or in connection herewith or therewith, unless caused by
its or their gross negligence or willful misconduct (in either case, as
determined by a court of competent jurisdiction). The duties of the
Administrative Agent shall be mechanical and administrative in nature; the
Administrative Agent shall not have by reason of this Agreement or any other
Credit Document a fiduciary relationship in respect of any Bank or the holder of
any Note; and nothing in this Agreement or any other Credit Document, expressed
or implied, is intended to or shall be so construed as to impose upon the
Administrative Agent any obligations in respect of this Agreement or any other
Credit Document except as expressly set forth herein or therein.
11.03 LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT.
Independently and without reliance upon the Administrative Agent, each Bank and
the holder of each Note, to the extent it deems appropriate, has made and shall
continue to make (i) its own independent investigation of the financial
condition and affairs of the Borrower and its Subsidiaries in connection with
the making and the continuance of the Loans and the taking or not taking of any
action in connection herewith
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and (ii) its own appraisal of the creditworthiness of the Borrower and its
Subsidiaries and, except as expressly provided in this Agreement, the
Administrative Agent shall not have any duty or responsibility, either initially
or on a continuing basis, to provide any Bank or the holder of any Note with any
credit or other information with respect thereto, whether coming into its
possession before the making of the Loans or at any time or times thereafter.
The Administrative Agent shall not be responsible to any Bank or the holder of
any Note for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectability, priority or sufficiency of this
Agreement or any other Credit Document or the financial condition of the
Borrower and its Subsidiaries or be required to make any inquiry concerning
either the performance or observance of any of the terms, provisions or
conditions of this Agreement or any other Credit Document, or the financial
condition of the Borrower and its Subsidiaries or the existence or possible
existence of any Default or Event of Default.
11.04 CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT. If the
Administrative Agent shall request instructions from the Required Banks with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Banks;
and the Administrative Agent shall not incur liability to any Person by reason
of so refraining. Without limiting the foregoing, neither any Bank nor the
holder of any Note shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder or under any other Credit Document in
accordance with the instructions of the Required Banks.
11.05 RELIANCE. The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by any Person that the Administrative Agent believed to be
the proper Person, and, with respect to all legal matters pertaining to this
Agreement and any other Credit Document and its duties hereunder and thereunder,
upon advice of counsel selected by the Administrative Agent (which may be
counsel for the Borrower).
11.06 INDEMNIFICATION. To the extent the Administrative Agent
is not reimbursed and indemnified by the Borrower or the Subsidiary Guarantors,
the Banks will reimburse and indemnify the Administrative Agent, in proportion
to their respective "percentages" as used in determining the Required Banks, for
and against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, judgments, costs, expenses or disbursements of whatsoever kind
or nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its respective duties hereunder or under any
other Credit Document, in any way relating to or arising out of this Agreement
or any other Credit Document; PROVIDED that no Bank shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct (in either case,
as determined by a court of competent jurisdiction).
11.07 THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
With respect to its obligation to make Loans under this Agreement, the
Administrative Agent shall have the rights and
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powers specified herein for a "Bank" and may exercise the same rights and powers
as though it were not performing the duties specified herein; and the term
"Banks," "Required Banks," "holders of Notes" or any similar terms shall, unless
the context clearly otherwise indicates, include the Administrative Agent in its
individual capacity. The Administrative Agent may accept deposits from, lend
money to, and generally engage in any kind of banking, trust or other business
with any Credit Party or any Affiliate of any Credit Party as if it were not
performing the duties specified herein, and may accept fees and other
consideration from the Borrower or any other Credit Party for services in
connection with this Agreement and otherwise without having to account for the
same to the Banks.
11.08 HOLDERS. The Administrative 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, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
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, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
11.09 RESIGNATION BY THE ADMINISTRATIVE AGENT. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
30 Business Days' prior written notice to the Borrower and the Banks. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent pursuant to clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Required Banks
shall appoint a successor Administrative Agent hereunder or thereunder who shall
be a commercial bank or trust company reasonably acceptable to the Borrower.
(c) If a successor Administrative Agent shall not have been so
appointed within such 30 Business Day period, the Administrative Agent, with the
consent of the Borrower (which consent shall not be unreasonably withheld),
shall then appoint a successor Administrative Agent who shall serve as
Administrative Agent hereunder or thereunder until such time, if any, as the
Required Banks appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed
pursuant to clause (b) or (c) above by the 30th Business Day after the date such
notice of resignation was given by the Administrative Agent, the Administrative
Agent's resignation shall become effective and the Required Banks shall
thereafter perform all the duties of the Administrative Agent hereunder and/or
under any other Credit Document until such time, if any, as the Banks appoint a
successor Administrative Agent as provided above.
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SECTION 12. MISCELLANEOUS.
12.01 PAYMENT OF EXPENSES, ETC. The Borrower agrees to: (i)
whether or not the transactions herein contemplated are consummated, pay all
reasonable out-of-pocket costs and expenses of the Administrative Agent in
connection with the negotiation, preparation, execution and delivery of the
Credit Documents and the documents and instruments referred to therein and any
amendment, waiver or consent relating thereto (including, without limitation,
the reasonable fees and disbursements of White & Case LLP) and of the
Administrative Agent and each of the Banks in connection with the enforcement of
the Credit Documents and the documents and instruments referred to therein
(including, without limitation, the reasonable fees and disbursements of counsel
for the Administrative Agent and either one outside counsel or in-house counsel
for each of the Banks); (ii) pay and hold each of the Banks harmless from and
against any and all present and future stamp and other similar taxes with
respect to the foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Bank) to pay such taxes;
and (iii) indemnify each Bank (including in its capacity as the Administrative
Agent or a Letter of Credit Issuer), its officers, directors, employees,
representatives and agents from and hold each of them harmless against any and
all losses, liabilities, claims, damages or expenses incurred by any of them
(whether asserted by the Borrower or otherwise) as a result of, or arising out
of, or in any way related to, or by reason of, (a) any investigation, litigation
or other proceeding (whether or not any Bank is a party thereto) related to the
entering into and/or performance of any Credit Document or the use of the
proceeds of any Loans hereunder or the Acquisition or the offering and sale of
the Senior Subordinated Notes or the consummation of any other transaction
contemplated in any Credit Document, including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct (in either case, as
determined by a court of competent jurisdiction) of the Person to be
indemnified) or (b) the actual or alleged presence of Hazardous Materials in the
air, surface water, groundwater, surface or subsurface of any Real Property
owned or at any time operated by the Borrower or any of its Subsidiaries, the
generation, storage, transportation or disposal of Hazardous Materials at any
location whether or not owned or operated by the Borrower or any of its
Subsidiaries, the non-compliance of any Real Property owned or at any time
operated by the Borrower or any of its Subsidiaries with federal, state and
local laws, regulations, and ordinances (including applicable permits
thereunder) applicable to any such Real Property, or any Environmental Claim
asserted against the Borrower, any of its Subsidiaries, or any such Real
Property, including, in each case, without limitation, the reasonable fees and
disbursements of counsel and other consultants incurred in connection with any
such investigation, litigation or other proceeding (but excluding any losses,
liabilities, claims, damages or expenses to the extent incurred by reason of the
gross negligence or willful misconduct (in either case, as determined by a court
of competent jurisdiction) of the Person to be indemnified). To the extent that
the undertaking to indemnify, pay or hold harmless the Administrative Agent or
any Bank set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, the Borrower shall make the maximum
contribution to the payment and satisfaction of each of the indemnified
liabilities which is permissible under applicable law.
12.02 RIGHT OF SETOFF. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, if an Event of Default
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then exists, each Bank is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to any Credit
Party or to any other Person, any such notice being hereby expressly waived, to
set off and to appropriate and apply any and all deposits (general or special)
and any other Indebtedness at any time held or owing by such Bank (including
without limitation by branches and agencies of such Bank wherever located) to or
for the credit or the account of any Credit Party against and on account of the
Obligations and liabilities of such Credit Party to such Bank under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations of such Credit Party purchased by such
Bank pursuant to Section 12.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any other Credit
Document, irrespective of whether or not such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.
12.03 NOTICES. (a) Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be in
writing (including telegraphic, telex, telecopier or cable communication) and
mailed, telegraphed, telexed, telecopied, cabled or delivered, if to a Credit
Party, at the address specified opposite its signature below or in the other
relevant Credit Documents, as the case may be; if to the Administrative Agent,
at its Notice Office; if to any Bank, at its address specified for such Bank on
Annex II; or, at such other address as shall be designated by any party in a
written notice to the other parties hereto. All such notices and communications
shall be mailed, telegraphed, telexed, telecopied, or cabled or sent by
overnight courier, and shall be effective when received.
(b) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent or the Swingline Bank (in the case of a Borrowing of
Swingline Loans) or any Letter of Credit Issuer, as the case may be, may prior
to receipt of written confirmation act without liability upon the basis of such
telephonic notice, believed by the Administrative Agent or the Swingline Bank or
any Letter of Credit Issuer in good faith to be from an Authorized Officer of
the Borrower. In each such case, the Borrower hereby waives the right to dispute
the Administrative Agent's or the Swingline Bank's record of the terms of such
telephonic notice.
12.04 ASSIGNMENTS; PARTICIPATIONS; ETC. (a) This Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective successors and assigns of the parties hereto, PROVIDED that the
Borrower may not assign or transfer any of its rights or obligations hereunder
without the prior written consent of the Banks. Each Bank may at any time grant
participations in any of its rights hereunder or under any of the Notes to
another financial institution, PROVIDED that in the case of any such
participation, the participant shall not have any rights under this Agreement or
any of the other Credit Documents (the participant's rights against such Bank in
respect of such participation to be those set forth in the agreement executed by
such Bank in favor of the participant relating thereto) and all amounts payable
by the Borrower hereunder shall be determined as if such Bank had not sold such
participation, except that the participant shall be entitled to the benefits of
Sections 1.10, 2.06 and 4.04 to the extent that such Bank would be entitled to
such benefits if the participation had not been entered into or sold, and,
PROVIDED FURTHER, that no Bank shall transfer, grant or assign any participation
under which the participant shall have rights to approve any amendment to or
waiver of this Agreement or any other Credit Document except to the extent such
amendment or waiver would (i) extend the final scheduled maturity of any Loan or
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Note or Letter of Credit (unless such Letter of Credit is not extended beyond
the Maturity Date) in which such participant is participating, or reduce the
rate or extend the time of payment of interest or Fees thereon (except in
connection with a waiver of the applicability of any post-default increase in
interest rates), or reduce the principal amount thereof (it being understood
that any amendment or modification to the financial definitions in this
Agreement shall not constitute a reduction in the rate of interest for purposes
of this clause (i)), or increase such participant's participating interest in
any Revolving Loan Commitment over the amount thereof then in effect (it being
understood that (x) a waiver of any Default or Event of Default or of a
mandatory reduction in the Total Revolving Loan Commitment, or a mandatory
prepayment, shall not constitute a change in the terms of any Revolving Loan
Commitment and (y) an increase in any Revolving Loan Commitment or Loan shall be
permitted without the consent of any participant so long as such participant's
participation is not increased as a result thereof), (ii) release all or
substantially all of the Collateral which support the Loans in which such
participant is participating (except as expressly permitted in any Credit
Document) or (iii) consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement.
(b) Notwithstanding the foregoing, (x) any Bank may assign all
or a portion of its Revolving Loan Commitment (and related outstanding
Obligations hereunder) to an Affiliate of such Bank or to another Bank, (y) with
the consent of the Administrative Agent (which consent shall not be unreasonably
withheld), any Bank may assign all or a portion of its Revolving Loan Commitment
(and related outstanding Obligations hereunder) to a Common Management Fund and
(z) with the consent of the Administrative Agent (which consent shall not be
unreasonably withheld), any Bank may assign all or a portion of its outstanding
Revolving Loan Commitment (and related outstanding Obligations hereunder) to one
or more Eligible Transferees. No assignment pursuant to the immediately
preceding sentence shall to the extent such assignment represents an assignment
to an institution other than one or more Banks hereunder, be in an aggregate
amount less than $5,000,000 unless the entire Revolving Commitment (and related
outstanding Obligations hereunder) of the assigning Bank is so assigned. If any
Bank so sells or assigns all or a part of its rights hereunder or under the
Notes, any reference in this Agreement or the Notes to such assigning Bank shall
thereafter refer to such Bank and to the respective assignee to the extent of
their respective interests and the respective assignee shall have, to the extent
of such assignment (unless otherwise provided therein), the same rights and
benefits as it would if it were such assigning Bank. Each assignment pursuant to
this Section 12.04(b) shall be effected by the assigning Bank and the assignee
Bank executing an Assignment Agreement (the "Assignment Agreement")
substantially in the form of Exhibit I (appropriately completed). In the event
of (and at the time of) any such assignment, either the assigning or the
assignee Bank shall pay to the Administrative Agent a nonrefundable assignment
fee of $3,500, and at the time of any assignment pursuant to this Section
12.04(b), (i) Annex I shall be deemed to be amended to reflect the Revolving
Loan Commitment of the respective assignee (which shall result in a direct
reduction to the Revolving Loan Commitment of the assigning Bank) and of the
other Banks, and (ii) if any such assignment occurs after the Restatement
Effective Date, the Borrower will issue new Notes to the respective assignee and
to the assigning Bank in conformity with the requirements of Section 1.05. No
transfer or assignment under this Section 12.04(b) will be effective until
recorded by the Administrative Agent on the Register pursuant to Section 12.16.
To the extent of any assignment pursuant to this Section 12.04(b), the assigning
Bank shall be relieved of its obligations hereunder with respect to the assigned
portion of its Revolving Loan Commitment. At the time of each assignment
pursuant to this Section 12.04(b) to a Person which is not already a Bank
hereunder and which is not a United States person (as such term is
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defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, the
respective assignee Bank shall provide to the Borrower and the Administrative
Agent the appropriate Internal Revenue Service Forms (and, if applicable, a
Section 4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent
that an assignment of all or any portion of a Bank's Revolving Loan Commitment
and related outstanding Obligations pursuant to Section 1.13 or this Section
12.04(b) would, at the time of such assignment, result in increased costs under
Section 1.10, 1.11, 2.06 or 4.04 which exceed those being charged, if any, by
the respective assigning Bank prior to such assignment, then the Borrower shall
not be obligated to pay such excess increased costs (although the Borrower shall
be obligated to pay any other increased costs of the type described above
resulting from changes giving rise to such increased costs after the date of the
respective assignment). Each Bank and the Borrower agree to execute such
documents (including, without limitation, amendments to this Agreement and the
other Credit Documents) as shall be necessary to effect the foregoing.
(c) Nothing in this Agreement shall prevent or prohibit any
Bank from pledging its Notes or Loans to a Federal Reserve Bank in support of
borrowings made by such Bank from such Federal Reserve Bank and, with the
consent of the Borrower and the Administrative Agent, any Bank which is a fund
may pledge all or any portion of its Notes or Loans to a trustee for the benefit
of investors and in support of its obligations to such investors.
(d) Notwithstanding any other provisions of this Section
12.04, no transfer or assignment of the interests or obligations of any Bank
hereunder or any grant of participation therein shall be permitted if such
transfer, assignment or grant would require the Borrower to file a registration
statement with the SEC or to qualify the Loans under the "Blue Sky" laws of any
State.
(e) Each Bank initially party to this Agreement hereby
represents, and each Person that became a Bank pursuant to an assignment
permitted by this Section 12 will, upon its becoming party to this Agreement,
represent that it is an Eligible Transferee which makes loans in the ordinary
course of its business and that it will make or acquire Loans for its own
account in the ordinary course of such business, PROVIDED that subject to the
preceding clauses (a) and (b), the disposition of any promissory notes or other
evidences of or interests in Indebtedness held by such Bank shall at all times
be within its exclusive control.
12.05 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of the Administrative Agent or any Bank in exercising any right, power
or privilege hereunder or under any other Credit Document and no course of
dealing between any Credit Party and the Administrative Agent or any Bank shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies herein expressly
provided are cumulative and not exclusive of any rights or remedies which the
Administrative Agent or any Bank would otherwise have. No notice to or demand on
any Credit Party in any case shall entitle any Credit Party to any other or
further notice or demand in similar or other circumstances or constitute a
waiver of the rights of the Administrative Agent or the Banks to any other or
further action in any circumstances without notice or demand.
12.06 PAYMENTS PRO RATA. (a) The Administrative Agent agrees
that promptly after its receipt of each payment from or on behalf of any Credit
Party in respect of any Obligations of such Credit Party hereunder, it shall
distribute such payment to the Banks (other than any Bank that
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has expressly waived its right to receive its PRO RATA share thereof) PRO RATA
based upon their respective shares, if any, of the Obligations with respect to
which such payment was received.
(b) Each of the Banks agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans or Fees, of a sum which with respect to the related sum or sums
received by other Banks is in a greater proportion than the total of such
Obligation then owed and due to such Bank bears to the total of such Obligation
then owed and due to all of the Banks immediately prior to such receipt, then
such Bank receiving such excess payment shall purchase for cash without recourse
or warranty from the other Banks an interest in the Obligations of the
respective Credit Party to such Banks in such amount as shall result in a
proportional participation by all of the Banks in such amount, PROVIDED that if
all or any portion of such excess amount is thereafter recovered from such Bank,
such purchase shall be rescinded and the purchase price restored to the extent
of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein,
the provisions of the preceding Sections 12.06(a) and (b) shall be subject to
the express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
12.07 CALCULATIONS; COMPUTATIONS. (a) The financial statements
to be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Banks), PROVIDED that (x) except as otherwise
specifically provided herein, all computations determining compliance with
Section 8, including definitions used therein shall utilize accounting
principles and policies in effect at the time of the preparation of, and in
conformity with those used to prepare, the December 31, 1997 historical
financial statements of the Borrower delivered to the Banks as described in
Section 6.10(b) and (y) that if at any time the computations determining
compliance with Section 8, including definitions used therein, utilize
accounting principles different from those utilized in the financial statements
furnished to the Banks, such financial statements shall be accompanied by
reconciliation work-sheets.
(b) All computations of interest, Commitment Commission and
Fees hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest, Commitment Commission or Fees are payable.
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (a) This Agreement and the other Credit Documents and the rights
and obligations of the parties hereunder and thereunder shall be construed in
accordance with and be governed by the law of the state of New York. Any legal
action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the courts of the State of New York or of the United States
for the Southern District of New York, and, by execution and delivery of this
Agreement, each Credit Party hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. Each Credit Party to this Agreement hereby
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further irrevocably waives any claim that any such courts lack jurisdiction over
such Credit Party, and agrees not to plead or claim, in any legal action or
proceeding with respect to this Agreement or any other Credit Document brought
in any of the aforesaid courts, that any such court lacks jurisdiction over such
Credit Party. The Borrower hereby irrevocably designates, appoints and empowers
CT Corporation System, with offices on the date hereof at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as its designee, appointee and agent to receive, accept and
acknowledge for and on its behalf, and in respect of its property, service of
any and all legal process, summons, notices and documents which may be served in
any such action or proceeding. If for any reason such designee, appointee and
agent shall cease to be available to act as such, each credit party agrees to
designate a new designee, appointee and agent in New York City on the terms and
for the purposes of this provision satisfactory to the Administrative Agent
under this Agreement. The Borrower further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to any credit party at its address set forth opposite its
signature below, such service to become effective 30 days after such mailing.
Nothing herein shall affect the right of the Administrative Agent or any Bank to
serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against any Credit Party in any other
jurisdiction.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Agreement or any other Credit Document brought in the courts referred to in
clause (a) above and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
(c) Each of the parties to this Agreement hereby irrevocably
waives all right to a trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Agreement, the other Credit Documents or the
transactions contemplated hereby or thereby.
12.09 COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Administrative Agent.
12.10 EFFECTIVENESS. This Agreement shall become effective on
the date (the "Restatement Effective Date") on which (i) the Borrower, the
Administrative Agent and each of the Banks shall have signed a counterpart
hereof (whether the same or different counterparts) and shall have delivered the
same to the Administrative Agent at the Notice Office of the Administrative
Agent or, in the case of the Banks, shall have given to the Administrative Agent
telephonic (confirmed in writing), written telex or facsimile transmission
notice (actually received) at such office that the same has been signed and
mailed to it and (ii) the conditions set forth in Section 5 are met to the
satisfaction of, or waived in writing by, the Administrative Agent and the
Required Banks. Unless the Administrative Agent has received actual notice from
any Bank that the conditions contained in Section 5 have not been met to its
satisfaction or waived by it in writing, upon the satisfaction of the condition
described in clause (i) of the immediately preceding sentence and upon the
Administrative Agent's good faith determination that the conditions described in
clause (ii) of
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the immediately preceding sentence have been met or waived in writing, then the
Restatement Effective Date shall be deemed to have occurred on the date
determined by clause (i), regardless of any subsequent determination that one or
more of the conditions thereto had not been met (although the occurrence of the
Restatement Effective Date shall not release the Borrower from any liability for
failure to satisfy one or more of the applicable conditions contained in Section
5).
12.11 HEADINGS DESCRIPTIVE. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
12.12 AMENDMENT OR WAIVER. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the Borrower and the Required Banks, PROVIDED that no such
change, waiver, discharge or termination shall, without the consent of each Bank
(other than a Defaulting Bank) (with Obligations being directly affected thereby
in the case of the following clause (i)), (i) extend the final scheduled
maturity date of any Loan or Note or extend the stated maturity of any Letter of
Credit beyond the Maturity Date, or reduce the rate or extend the time of
payment of interest (other than as a result of waiving the applicability of any
post-default increase in interest rates) or Fees thereon, or reduce the
principal amount thereof (it being understood that any amendment or modification
to the financial definitions in this Agreement shall not constitute a reduction
in the rate of interest for purposes of this clause (i)), (ii) release all or
substantially all of the Collateral (in each case except as expressly provided
in the Credit Documents), (iii) amend, modify or waive any provision of this
Section 12.12(a), (iv) reduce the percentage specified in the definition of
Required Banks (it being understood that, with the consent of the Required
Banks, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Banks on substantially the same
basis as Revolving Loan Commitments are included on the Restatement Effective
Date) or (v) consent to the assignment or transfer by the Borrower of any of its
rights and obligations under this Agreement; PROVIDED FURTHER, that no such
change, waiver, discharge or termination shall (v) increase the Revolving Loan
Commitment of any Bank over the amount thereof then in effect without the
consent of such Bank (it being understood that waivers or modifications of
conditions precedent, covenants, Defaults or Events of Default or of a mandatory
reduction in the Total Revolving Loan Commitment shall not constitute an
increase of the Revolving Loan Commitment of any Bank, and that an increase in
the available portion of any Revolving Loan Commitment of any Bank shall not
constitute an increase in the Revolving Loan Commitment of such Bank), (w)
without the consent of each Letter of Credit Issuer, amend, modify or waive any
provision of Section 2 or alter its rights or obligations with respect to
Letters of Credit, (x) without the consent of the Administrative Agent, amend,
modify or waive any provision of Section 11 as same applies to the
Administrative Agent or any other provision as same relates to the rights or
obligations of the Administrative Agent, (y) without the consent of the
Collateral Agent, amend, modify or waive any provision relating to the rights or
obligations of the Collateral Agent or (z) without the consent of the Swingline
Bank, alter its rights or obligations with respect to Swingline Loans.
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by clauses (a)(i) through (v), inclusive, of the first proviso to
Section 12.12(a), the consent of the Required Banks is obtained but the consent
of one or more of the other Banks whose consent is required is not obtained,
then the Borrower shall
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have the right, so long as all non-consenting Banks whose individual consent is
required are treated as described in either clauses (A) or (B) below, to either
(A) replace each such non-consenting Bank or Banks with one or more Replacement
Banks pursuant to Section 1.13 so long as at the time of such replacement, each
such Replacement Bank consents to the proposed change, waiver, discharge or
termination or (B) terminate such non-consenting Bank's Revolving Loan
Commitment in accordance with Section 3.02(b), PROVIDED that, unless the
Revolving Loan Commitment is terminated pursuant to preceding clause (B) is
immediately replaced in full at such time through the addition of new Banks or
the increase of the Revolving Loan Commitments of existing Banks (who in each
case must specifically consent thereto), then in the case of any action pursuant
to preceding clause (B) the Required Banks (determined before giving effect to
the proposed action) shall specifically consent thereto, PROVIDED further, that
in any event the Borrower shall not have the right to replace a Bank or
terminate its Revolving Loan Commitment solely as a result of the exercise of
such Bank's rights (and the withholding of any required consent by such Bank)
pursuant to the second proviso to Section 12.12(a).
12.13 SURVIVAL. All indemnities set forth herein including,
without limitation, in Section 1.10, 1.11, 2.06, 4.04, 11.06 or 12.01 shall,
subject to the provisions of Section 12.17 (to the extent applicable), survive
the execution and delivery of this Agreement and the making and repayment of the
Loans.
12.14 DOMICILE OF LOANS. Each Bank may transfer and carry its
Loans at, to or for the account of any branch office, subsidiary or affiliate of
such Bank, PROVIDED that the Borrower shall not be responsible for costs arising
under Section 1.10, 2.06 or 4.04 resulting from any such transfer (other than a
transfer pursuant to Section 1.12) to the extent not otherwise applicable to
such Bank prior to such transfer.
12.15 CONFIDENTIALITY. Subject to Section 12.04, the Banks
shall hold all non-public information obtained pursuant to the requirements of
this Agreement which has been identified as such by the Borrower in accordance
with its customary procedure for handling confidential information of this
nature and in accordance with safe and sound banking practices and in any event
may make disclosure reasonably required by any BONA FIDE actual or potential
transferee or participant in connection with the contemplated transfer of any
Loans or participation therein or an Affiliate of such Bank (including
attorneys, legal advisors and consultants of such Bank) (so long as each of such
actual or potential transferee, participant or Affiliate agrees to be bound by
the provisions of this Section 12.15) or as required or requested by any
governmental agency or representative thereof or pursuant to legal process,
PROVIDED that, unless specifically prohibited by applicable law or court order,
each Bank shall notify the Borrower of any request by any governmental agency or
representative thereof (other than any such request in connection with an
examination of the financial condition of such Bank by such governmental agency)
for disclosure of any such non-public information prior to disclosure of such
information, and provided further that in no event shall any Bank be obligated
or required to return any materials furnished by the Borrower or any Subsidiary.
12.16 REGISTER. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for purposes of
this Section 12.16, to maintain a register (the "Register") on which it will
record the Revolving Loan Commitments from time to time of each of the Banks,
the Loans made by each of the Banks and each repayment in respect of the
principal
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amount of the Loans of each Bank. Failure to make any such recordation, or any
error in such recordation shall not affect the Borrower's obligations in respect
of such Loans. With respect to any Bank, the transfer of the Revolving Loan
Commitment of such Bank and the rights to the principal of, and interest on, any
Loan made pursuant to such Revolving Loan Commitment shall not be effective
until such transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Revolving Loan Commitment and Revolving
Loans and prior to such recordation all amounts owing to the transferor with
respect to such Revolving Loan Commitments and Revolving Loans shall remain
owing to the transferor. The registration of assignment or transfer of all or
part of any Revolving Loan Commitments and Revolving Loans shall be recorded by
the Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment Agreement
pursuant to Section 12.04(b). Coincident with the delivery of such an Assignment
Agreement to the Administrative Agent for acceptance and registration of
assignment or transfer of all or part of a Revolving Loan, or as soon thereafter
as practicable, the assigning or transferor Bank shall surrender the Revolving
Note evidencing such Revolving Loan, and thereupon one or more new Revolving
Notes in the same aggregate principal amount shall be issued to the assigning or
transferor Bank and/or the new Bank. The Borrower agrees to indemnify the
Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under this Section
12.16.
12.17 LIMITATION ON ADDITIONAL AMOUNTS, ETC. Notwithstanding
anything to the contrary contained in Sections 1.10, 1.11, 2.06 or 4.04 of this
Agreement, unless a Bank gives notice to the Borrower that it is obligated to
pay an amount under any such Section within 150 days after the later of (x) the
date the Bank incurs the respective increased costs, Taxes, loss, expense or
liability, reduction in amounts received or receivable or reduction in return on
capital or (y) the date such Bank has actual knowledge of its incurrence of the
respective increased costs, Taxes, loss, expense or liability, reductions in
amounts received or receivable or reduction in return on capital, then such Bank
shall only be entitled to be compensated for such amount by the Borrower
pursuant to said Section 1.10, 1.11, 2.06 or 4.04, as the case may be, to the
extent (I) the costs, Taxes, loss, expense or liability, reduction in amounts
received or receivable or reduction in return on capital are incurred or
suffered on or after the date which occurs 150 days prior to such Bank giving
notice to the Borrower that it is obligated to pay the respective amounts
pursuant to said Section 1.10, 1.11, 2.06 or 4.04, as the case may be, and (II)
the notice of such payment is accompanied by a written statement by the Banks
that such amount is an amount charged by such Banks to similarly situated
borrowers. This Section 12.17 shall have no applicability to any Section of this
Agreement other than said Sections 1.10, 1.11, 2.06 and 4.04.
12.18 ADDITIONS OF NEW BANKS; TERMINATION OF COMMITMENTS OF
NON-CONTINUING BANKS; SURRENDER OF NOTES. (a) On and as of the occurrence of the
Restatement Effective Date in accordance with Section 12.10 hereof, each New
Bank shall become a "Bank" under, and for all purposes of, this Agreement and
the other Credit Documents.
(b) The parties hereto acknowledge that each Existing Bank has
been offered the opportunity to participate in this Agreement, after the
occurrence of the Restatement Effective Date, as a Continuing Bank hereunder,
but that no Existing Bank is obligated to be a Continuing Bank.
(c) Notwithstanding anything to the contrary contained in the
Existing Credit Agreement, this Agreement or any other Credit
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Document, the Borrower agrees and each of the Banks hereby agree that on the
Restatement Effective Date, (i) each Bank with a Revolving Loan Commitment as
set forth on Annex I (after giving effect to the Restatement Effective Date)
shall make that principal amount of Revolving Loans to the Borrower as is
required by Section 1.01 and (ii) in the case of each Non-Continuing Bank, all
of such Non-Continuing Bank's Existing Loans outstanding on the Restatement
Effective Date shall be repaid in full on such date, together with interest
thereon and all accrued Fees (and any other amounts) owing to such
Non-Continuing Bank, and the Revolving Loan Commitment (under, and as defined
in, the Existing Credit Agreement) of such Non-Continuing Bank, if any, shall be
terminated, effective upon the occurrence of the Restatement Effective Date.
Notwithstanding anything to the contrary contained in the Existing Credit
Agreement, this Agreement or any other Credit Document, the parties hereto
hereby agree that in the event that any Existing Bank shall fail to execute a
counterpart of this Agreement prior to the occurrence of the Restatement
Effective Date, such Existing Bank does not consent to the amendment and
restatement of the Existing Credit Agreement provided for herein and shall be
deemed to be a Non-Continuing Bank and, concurrently with the occurrence of the
Restatement Effective Date, the Revolving Loan Commitment (under, and as defined
in, the Existing Credit Agreement) of such Existing Bank, if any, shall be
terminated, all Existing Loans of such Existing Bank outstanding on the
Restatement Effective Date shall be repaid in full, together with interest
thereon and all accrued Fees (and any other amounts) owing to such Existing
Bank, and concurrently with the occurrence of the Restatement Effective Date,
such Existing Bank shall no longer constitute a "Bank" under this Agreement and
the other Credit Documents, provided that all indemnities of the Credit Parties
under the Existing Credit Agreement and the other Credit Documents (as in effect
prior to the Restatement Effective Date) for the benefit of such Existing Bank
shall survive in accordance with the terms thereof.
(d) On the Restatement Effective Date, each Existing Bank
shall have surrendered to the Administrative Agent for cancellation the
promissory notes issued to it pursuant to the Existing Credit Agreement in
respect of its Existing Loans and the Administrative Agent shall promptly
deliver such cancelled promissory notes to the Borrower.
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date first above
written.
Address: GEO SPECIALTY CHEMICALS, INC.
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▇▇▇▇▇ ▇▇▇
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Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ -------------------------------
Title: Chief Financial Officer
BANKERS TRUST COMPANY,
Individually and as Administrative Agent
By: /s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
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Title: Managing Director
U.S. BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Title: Senior Vice President