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EXHIBIT 10(b)
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CREDIT AGREEMENT
dated as of November 6, 1995
among
▇▇▇▇▇ ENTERPRISES, INC.
THE LENDERS LISTED HEREIN,
and
SUNTRUST BANK, ATLANTA
as Agent
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TABLE OF CONTENTS
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ARTICLE I. DEFINITIONS; CONSTRUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Accounting Terms and Determination . . . . . . . . . . . . . . . . . . . . . 20
Section 1.03. Other Definitional Terms . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 1.04. Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE II. REVOLVING LOANS AND LETTERS OF CREDIT. . . . . . . . . . . . . . . . . . . . 20
Section 2.01. Commitment; Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 2.02. Notes; Repayment of Principal. . . . . . . . . . . . . . . . . . . . . . . . 21
Section 2.03. Voluntary Reduction of Revolving
Credit Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 2.04. Mandatory Reduction of Revolving Credit
Commitments Upon Asset Sale. . . . . . . . . . . . . . . . . . . . . . . 21
Section 2.05. Letter of Credit Subfacility . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 2.06. Notice of Issuance of Letter of Credit;
Agreement to Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 2.07. Payment of Amounts drawn under Letter
of Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 2.08. Payment by Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.09. Obligations Absolute . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.10. Indemnification; Nature of Agent's
Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE III. GENERAL LOAN TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 3.01. Funding Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 3.02. Disbursement of Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 3.03. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 3.04. Interest Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 3.05. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 3.06. Voluntary Prepayments of Borrowings. . . . . . . . . . . . . . . . . . . . . 33
Section 3.07. Payments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 3.08. Interest Rate Not Ascertainable, etc . . . . . . . . . . . . . . . . . . . . 36
Section 3.09. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 3.10. Increased Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 3.11. Lending Offices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 3.12. Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 3.13. Assumptions Concerning Funding of
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Eurodollar Advances. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.14. Apportionment of Payments. . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.15. Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.16. Capital Adequacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 3.17. Notice of Capital Adequacy and
Increased Costs Claims; Limitation
on Payment Obligations . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE IV. CONDITIONS TO BORROWINGS AND LETTERS
OF CREDIT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.01. Conditions Precedent to Initial Loans
and Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.02. Conditions to All Loans and Letters of
Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE V. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . 46
Section 5.01. Corporate Existence; Compliance with
Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 5.02. Corporate Power; Authorization . . . . . . . . . . . . . . . . . . . . . . . 46
Section 5.03. Enforceable Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 5.04. No Legal Bar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 5.05. No Material Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 5.06. Investment Company Act, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 5.07. Margin Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 5.08. Compliance with Environmental Laws . . . . . . . . . . . . . . . . . . . . . 47
Section 5.09. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 5.10. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 5.11. No Burdensome Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 5.12. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 5.13. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 5.14. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 5.15. ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 5.16. Patents, Trademarks, Licenses, Etc. . . . . . . . . . . . . . . . . . . . . 51
Section 5.17. Ownership of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 5.18. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 5.19. Financial Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 5.20. Labor Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 5.21. Payment or Dividend Restrictions . . . . . . . . . . . . . . . . . . . . . . 53
Section 5.22. Intercompany Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 5.23. Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE VI. AFFIRMATIVE COVENANTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.01. Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.02. Compliance with Laws, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.03. Payment of Taxes and Claims, Etc. . . . . . . . . . . . . . . . . . . . . . 54
Section 6.04. Keeping of Books . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.05. Visitation, Inspection, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.06. Insurance; Maintenance of Properties . . . . . . . . . . . . . . . . . . . . 55
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Section 6.07. Reporting Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 6.08. Financial Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 6.09. Notices Under Certain Other Indebtedness . . . . . . . . . . . . . . . . . . 60
ARTICLE VII. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 7.01. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 7.02. Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 7.03. Mergers, Asset Sales, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 7.04. Dividends, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 7.05. Investments, Loans, Acquisitions Etc . . . . . . . . . . . . . . . . . . . . 65
Section 7.06. Sale and Leaseback Transactions. . . . . . . . . . . . . . . . . . . . . . . 66
Section 7.07. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 7.08. Issuance of Capital Stock. . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 7.09. ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 7.10. Limitation on Payment Restrictions
Affecting Consolidated Companies . . . . . . . . . . . . . . . . . . . . 66
Section 7.11. Actions Under Certain Documents. . . . . . . . . . . . . . . . . . . . . . . 67
Section 7.12. Changes in Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
ARTICLE VIII. EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 8.01. Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 8.02. Covenants Without Notice . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 8.03. Other Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 8.04. Representations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 8.05. Non-Payments of Other Indebtedness . . . . . . . . . . . . . . . . . . . . . 68
Section 8.06. Defaults Under Other Agreements;
Change in Control Provisions . . . . . . . . . . . . . . . . . . . . . . 68
Section 8.07. Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 8.08. ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 8.09. Money Judgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.10. Ownership of Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.11. Change in Control of Borrower. . . . . . . . . . . . . . . . . . . . . . . . 70
Section 8.12. Default Under Other Credit Documents . . . . . . . . . . . . . . . . . . . . 71
ARTICLE IX. THE AGENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 9.01. Appointment of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 9.02. Authorization of Agent with Respect
to the Security Documents. . . . . . . . . . . . . . . . . . . . . . . . 72
Section 9.03. Nature of Duties of Agent. . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 9.04. Lack of Reliance on the Agent. . . . . . . . . . . . . . . . . . . . . . . . 73
Section 9.05. Certain Rights of the Agent. . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.06. Reliance by Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.07. Indemnification of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 9.08. The Agent in its Individual
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Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.09. Holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 9.10. Successor Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
ARTICLE X. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 10.01. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 10.02. Amendments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 10.03. No Waiver; Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . 77
Section 10.04. Payment of Expenses, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 10.05. Right of Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 10.06. Benefit of Agreement; Assignments
and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 10.07. Governing Law; Submission to
Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Section 10.08. Independent Nature of Lenders' Rights. . . . . . . . . . . . . . . . . . . . 83
Section 10.09. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 10.10. Effectiveness; Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 10.11. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 10.12. Independence of Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 10.13. Change in Accounting Principles,
Fiscal Year or Tax Laws. . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 10.14. Headings Descriptive; Entire Agreement . . . . . . . . . . . . . . . . . . . 84
SCHEDULES
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SCHEDULE 1.01 Intercompany Loans
SCHEDULE 5.01 Organization and Ownership of
Subsidiaries
SCHEDULE 5.05 Certain Pending and Threatened
Litigation
SCHEDULE 5.08(a) Environmental Compliance
SCHEDULE 5.08(b) Environmental Notices
SCHEDULE 5.08(c) Environmental Permits
SCHEDULE 5.11 Burdensome Restrictions
SCHEDULE 5.12 Tax Filings and Payments
SCHEDULE 5.15 Employee Benefit Matters
SCHEDULE 5.16 Patent, Trademark, License, and
Other Intellectual Property
Matters
SCHEDULE 5.17 Ownership of Properties
SCHEDULE 5.18 Existing Indebtedness
SCHEDULE 5.20 Labor and Employment Matters
SCHEDULE 5.21 Dividend Restrictions
SCHEDULE 6.08 Financial Covenant Calculations
Second Quarter 1995
SCHEDULE 7.01 Outstanding Indebtedness
SCHEDULE 7.02 Existing Liens
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SCHEDULE 7.05 Existing Investments
SCHEDULE 8.11 Existing Shareholders
EXHIBITS
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EXHIBIT A - Form of Revolving Credit Note
EXHIBIT B - Form of Borrowing Certificate
EXHIBIT C - Form of Conversion/Continuation
Certificate
EXHIBIT D - Form of Closing Certificate
EXHIBIT E - Form of Opinion of ▇▇▇▇▇▇ & Bird
EXHIBIT F - Form of Compliance Certificate
EXHIBIT G - Form of Assignment and Acceptance
EXHIBIT H - Form of Note Assignment
EXHIBIT I - Form of Intercompany Note
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT made and entered into as of November 6,
1995, by and among ▇▇▇▇▇ ENTERPRISES, INC., a Delaware corporation, formerly
known as Vista Resources, Inc. (the "Borrower"), SUNTRUST BANK, ATLANTA,
formerly known as Trust Company Bank, a banking corporation organized under the
laws of the State of Georgia ("SunTrust"), the other banks and lending
institutions listed on the signature pages hereof, and any assignees of
SunTrust or such other banks and lending institutions which become "Lenders" as
provided herein (SunTrust, and such other banks, lending institutions, and
assignees referred to collectively herein as the "Lenders"), SUNTRUST BANK,
ATLANTA, in its capacity as agent for the Lenders and each successor agent for
such Lenders as may be appointed from time to time pursuant to Article IX
hereof (the "Agent");
W I T N E S S E T H:
WHEREAS, at the request of the Borrower, the Lenders have
agreed to provide certain credit facilities to the Borrower, on the terms and
subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, Borrower, the Lenders and the Agent agree,
upon the terms and subject to the conditions set forth herein as follows:
ARTICLE I.
DEFINITIONS; CONSTRUCTION
SECTION 1.01. DEFINITIONS. In addition to the other terms
defined herein, the following terms used herein shall have the meanings herein
specified (to be equally applicable to both the singular and plural forms of
the terms defined):
"Acquisition" shall mean any transaction, or any series of
related transactions, by which the Borrower and/or any of its Subsidiaries
directly or indirectly (a) acquires any ongoing business or all or
substantially all of the assets of any Person or division or Asset Group
thereof, whether through purchase of assets, merger or otherwise, (b) acquires
(in one transaction or as the most recent transaction in a series of
transactions) control of a majority of the securities of a Person which have
ordinary voting power for the election of directors or
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(c) otherwise acquires control of 51% ownership interest in any such Person.
"Adjusted LIBO Rate" shall mean, with respect to each
Interest Period for a Eurodollar Advance, the rate obtained by dividing (A)
LIBOR for such Interest Period by (B) a percentage equal to 1 minus the then
stated maximum rate (stated as a decimal) of all reserve requirements
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) applicable to any Lender (or assignee thereof) which is a
member bank of the Federal Reserve System in respect of Eurocurrency
liabilities as defined in Regulation D (or against any successor category of
liabilities as defined in Regulation D). As of the date of this Agreement,
such stated maximum rate is 0.
"Advance" shall mean any principal amount advanced and
remaining outstanding at any time under the Revolving Loans, which Advance
shall be made or outstanding as a Base Rate Advance or Eurodollar Advance, as
the case may be.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by, or under common control with, such
Person, whether through the ownership of voting securities, by contract or
otherwise. For purposes of this definition, "control" (including with
correlative meanings, the terms "controlling", "controlled by", and "under
common control with") as applied to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of that Person.
"Agent" shall mean SunTrust Bank, Atlanta a Georgia banking
corporation, and any successor agent appointed pursuant to Article IX hereof.
"Agreement" shall mean this Credit Agreement, either as
originally executed or as hereafter amended, restated, supplemented or
otherwise modified from time to time.
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"Applicable Commitment Percentage" shall mean, with respect to
any calculation of the Commitment Fee hereunder, (i) through December 31, 1995,
fifteen one hundredths of one percent (0.15%) per annum, and (ii) thereafter,
the percentage per annum determined by reference to the following subparagraphs
(a) through (c), whichever is applicable:
If Borrower's Consolidated
Funded Debt to Consolidated The Applicable
EBITDA is: Commitment Percentage is:
--------------------------- -------------------------
(a) Less than 1.50:1.00 .125%
(b) greater than or equal
to 1.50:1.00 but
less than or equal to
2.50:1.00 .15%
(c) greater than 2.50:1.00 .1875%
The Applicable Commitment Percentage shall be recalculated as and when the
Applicable Margin is recalculated in the manner set forth in the definition of
the Applicable Margin.
"Applicable Margin" shall mean, (i) with respect to all
Eurodollar Advances outstanding pursuant to the Revolving Credit Commitments
through December 31, 1995, one half of one percent (0.50%) per annum, (ii) with
respect to all Base Rate Advances outstanding pursuant to the Revolving Credit
Commitments through December 31, 1995, zero percent (0%) per annum, and (iii)
with respect to all Advances outstanding pursuant to the Revolving Credit
Commitments thereafter, the relevant percentage indicated below for Borrower's
Consolidated Funded Debt to Consolidated EBITDA ratio, as determined quarterly
for the immediately preceding four fiscal quarters based upon the financial
statements delivered to the Lenders pursuant to Section 6.07(a) or Section
6.07(b) hereof, as the case may be, with such Applicable Margin to be effective
as of the first day of the second fiscal quarter immediately following the
fiscal quarter for which such financial statements are delivered (for example,
the Applicable Margin effective as of January 1, 1996 will be calculated based
upon the financial statements delivered with respect to, and the four
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fiscal quarters ending on, September 30, 1995):
If Borrower's Consolidated The Applicable Margin is:
Funded Debt to Consolidated
EBITDA is: Base Rate Eurodollar
--------------------------- --------- ----------
(a) Less than 1.50:1.00 -.50% .40%
(b) greater than or equal
to 1.50:1.00 but
less than or equal to 0
2.50:1.00 .50%
(c) greater than 2.50:1.00 0 .70%
"Asset Group" shall mean any asset or group of assets with
identifiable net income (or loss).
"Asset Sale" shall mean the disposition whether by sale,
transfer, exchange or other disposition of any or all of the assets of Borrower
or any of its Subsidiaries (including the stock of Subsidiaries) in which the
Net Proceeds of such disposition, or related series of such dispositions,
exceeds $100,000, other than (i) sales of inventory in the ordinary course of
business, and (ii) damage, destruction, condemnation, theft or similar loss of
such assets.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and another financial institution in
accordance with the terms of this Agreement and substantially in the form of
Exhibit G.
"Bankruptcy Code" shall mean The Bankruptcy Code of 1978, as
amended and in effect from time to time (11 U.S.C. Section 101 et seq.).
"Base Rate" shall mean (with any change in the Base Rate to be
effective as of the date of change of either of the following rates) the higher
of (i) the rate which the Agent publicly announces from time to time as its
prime lending rate, as in effect from time to time, and (ii) the Federal Funds
Rate, as in effect from time to time, plus one-half of one percent (0.50%) per
annum. The Agent's prime lending rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to customers;
the Agent may make commercial loans or other loans at rates of interest at,
above or below the Agent's prime lending rate.
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"Base Rate Advance" shall mean an Advance made or outstanding
as a Revolving Loan, bearing interest based on the Base Rate.
"Borrower" shall mean ▇▇▇▇▇ Enterprises, Inc., a Delaware
corporation, its successors and permitted assigns.
"Borrowing" shall mean the incurrence by Borrower under any
Facility of Advances of one Type concurrently having the same Interest Period
or the continuation or conversion of an existing Borrowing or Borrowings in
whole or in part.
"Business Day" shall mean any day excluding Saturday, Sunday
and any other day on which banks are required or authorized to close in
Atlanta, Georgia and, if the applicable Business Day relates to Eurodollar
Advances, any day on which trading is not carried on by and between banks in
deposits of the applicable currency in the applicable interbank Eurocurrency
market.
"Buyer Note" shall mean that certain promissory note to be
issued pursuant to the Stock Purchase Agreement dated as of October 16 1995 by
and between the Borrower and Atlantic American Corporation in an amount equal
to the amount owing by Borrower pursuant to the Seller Note, to be made by
Atlantic American Corporation in favor of the Borrower and to mature on the
same date as the Seller Note.
"Capital Lease" shall mean, as applied to any Person, any
lease of any property (whether real, personal or mixed) by such Person as
lessee which would, in accordance with GAAP, be required to be classified and
accounted for as a capital lease on a balance sheet of such Person.
"Capital Lease Obligation" shall mean, with respect to any
Capital Lease, the amount of the obligation of the lessee thereunder which
would, in accordance with GAAP, appear on a balance sheet of such lessee in
respect of such Capital Lease.
"Cash Equivalents" shall mean: (i) securities issued,
guaranteed or insured by the United States or any of its agencies with
maturities of not more than one year from the date acquired; (ii) certificates
of deposit with maturities of not more than one year from the dated issued by a
U.S. federal or state chartered commercial bank of recognized standing, which
has a capital an unimpaired surplus in excess of $500,000,000.00 and which bank
or its holding company has a short-term commercial paper rating of at least A-2
or the equivalent by S&P or at least P-2 or the equivalent by ▇▇▇▇▇'▇; (iii)
reverse repurchase agreements with terms of not more than seven days from the
date acquired, for securities of the type described in (i) above and entered
into
-5-
12
only with commercial banks having the qualifications described in (ii) above;
(iv) commercial paper or finance company paper issued by any Person
incorporated under the laws of the United States of any state thereof and rated
at least A-2 or the equivalent by S&P or at least P-2 or the equivalent by
▇▇▇▇▇'▇, in each case with maturities of not more than one year from the date
acquired; and (v) investments in money market funds registered under the
Investment Company Act of 1940, which have net assets of at least
$500,000,000.00 and at least eighty-five percent (85%) of whose assets consist
of securities and other obligations of the type described in clauses (i)
through (iv) above.
"Change in Control Provision" shall mean any term or provision
contained in any indenture, debenture, note, or other agreement or document
evidencing or governing Indebtedness of Borrower evidencing debt or a
commitment to extend loans in excess of $500,000 which requires, or permits the
holder(s) of such Indebtedness of Borrower to require that such Indebtedness of
Borrower be redeemed, repurchased, defeased, prepaid or repaid, either in whole
or in part, or the maturity of such Indebtedness of Borrower to be accelerated
in any respect, as a result of a change in ownership of the capital stock of
Borrower or voting rights with respect thereto.
"Closing Date" shall mean November __, 1995 or such later date
on which the initial Loans are made and the conditions set forth in Section
4.01 and 4.02 are satisfied.
"Commitment" shall mean, for any Lender at any time, its
Revolving Credit Commitment.
"Commitment Fee" shall have the meaning ascribed to it in
Section 3.05(a).
"Consolidated Companies" shall mean, collectively, Borrower
and all of its Subsidiaries the accounts of which are consolidated with those
of the Borrower in its consolidated financial statements in accordance with
GAAP.
"Consolidated EBIT" shall mean, with reference to any period,
the sum of Consolidated Net Income (Loss) for such period plus, to the extent
deducted in determining Consolidated Net Income (Loss), (i) provision for taxes
based on income made by the Consolidated Companies during such period and (ii)
Consolidated Interest Expense. For the purposes of calculating Consolidated
EBIT, (a) any Person who becomes a Subsidiary on or prior to the date of
determination shall be deemed to have been a Subsidiary for the entire period
for which such calculation is being made; and (b) any Asset Group acquired by
the Borrower or a Subsidiary on or prior to the date of determination shall be
deemed to have
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been owned during the entire period for which such calculation is being made;
provided that, in the event that the Person or Asset Group to be included
herein pursuant to subsections (a) and (b) for the relevant fiscal period had
not been, prior to its acquisition by a Consolidated Company, obtaining annual
audited financial statements, prepared by a nationally recognized accounting
firm, for a period of at least three years, the EBIT of such Person or Asset
Group shall be included in this definition only if the Borrower provides the
Lenders with evidence of the calculation of the EBIT of such Person or Asset
Group which is acceptable to the Required Lenders in their reasonable
discretion.
"Consolidated EBITDA" shall mean, with reference to any
period, an amount equal to the sum of Consolidated EBIT plus to the extent
deducted in determining Consolidated Net Income (Loss), depreciation and
amortization expense of the Consolidated Companies for such period as
determined in accordance with GAAP. For the purposes of calculating
Consolidated EBITDA, (a) any Person who becomes a Subsidiary on or prior to the
date of determination shall be deemed to have been a Subsidiary for the entire
period for which such calculation is being made; and (b) any Asset Group
acquired by the Borrower or a Subsidiary on or prior to the date of
determination shall be deemed to have been owned during the entire period for
which such calculation is being made; and; provided that, in the event that the
Person or Asset Group to be included herein pursuant to subsections (a) and (b)
for the relevant fiscal period had not been, prior to its acquisition by a
Consolidated Company, obtaining annual audited financial statements, prepared
by a nationally recognized accounting firm, for a period of at least three
years, the EBITDA of such Person or Asset Group shall be included in this
definition only if the Borrower provides the Lenders with evidence of the
calculation of the EBITDA of such Person or Asset Group which is acceptable to
the Required Lenders in their reasonable discretion.
"Consolidated Funded Debt" shall mean, as at any date of
determination, the total of all Funded Debt (including the current portions
thereof) of the Consolidated Companies outstanding on such date, determined in
accordance with GAAP on a consolidated basis, after eliminating all
intercompany items; provided, that, for purposes of calculating Consolidated
Funded Debt, the Borrower's obligations pursuant to the Seller Note and any
stand-by letter of credit facility established solely to support such Seller
Note (which letter of credit and accompanying documentation has been approved
in writing by the Required Lenders) shall not be included in Consolidated
Funded Debt unless and until one or more of the following events shall occur:
(x) the Seller Note and any reimbursement obligations pursuant to any letter of
credit facility established in support thereof shall not have been paid in full
or tendered for payment into escrow in accordance with the
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terms of the agreements governing the Seller Note, by November 1, 1996, (y) any
default shall occur pursuant to the Buyer Note which default is not cured
within any applicable grace period or waived in writing by the Borrower, or (z)
the Agent and the Required Lenders shall deem, in good faith, that the prospect
of repayment of the Buyer Note in full (or the tender of payment thereof for
placement into escrow) on its scheduled due date has been substantially
impaired; provided that, during any period that Wachovia Bank of Georgia, N.A.
is a party to this Agreement and also has in place the primary credit facility
to Atlantic American Corporation, the Agent and the Required Lenders shall not
be entitled to make such a determination unless an event of default has
occurred pursuant to such credit facility.
"Consolidated Interest Expense" shall mean, with reference to
any period, the total interest expense (not net of interest income) of the
Consolidated Companies for such period (including, without limitation, interest
expense attributable to Capital Leases), determined in accordance with GAAP on
a consolidated basis.
"Consolidated Net Income (Loss)" shall mean, with reference to
any period, the net income (or deficit) of the Consolidated Companies for such
period (taken as a cumulative whole), determined in accordance with GAAP on a
consolidated basis, provided that the following shall be excluded if and to the
extent otherwise included in net income of the Borrower and any of its
Subsidiaries for such period:
(a) the income (or deficit) of any Person accrued prior
to the date it became a Subsidiary or was merged into or consolidated
with the Borrower or a Subsidiary of the Borrower unless, pursuant to
the definition of Consolidated EBITDA, such Person is deemed to be a
Subsidiary of the Borrower for such period;
(b) the income (or deficit) of any Asset Group accrued
prior to the date such Asset Group was acquired by the Borrower or a
Subsidiary of the Borrower unless, pursuant to the provisions of the
definition of Consolidated EBITDA, such Asset Group is deemed to have
been owned by the Borrower or a Subsidiary of the Borrower for such
period; and
(c) any aggregate net gain (or aggregate net loss) during
such period arising from the sale, exchange, or other disposition of
assets of the Borrower or any of its Subsidiaries outside of the
ordinary course of business.
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15
"Contractual Obligation" of any Person shall mean any
provision of any security issued by such Person or of any agreement, instrument
or undertaking under which such Person is obligated or by which it or any of
the property owned by it is bound.
"Credit Documents" shall mean, collectively, this Agreement,
the Notes, the Note Assignment, the Intercompany Loan Documents, the Letters of
Credit and all other instruments, documents, certificates, agreements and
writings executed in connection herewith.
"Credit Parties" shall mean, collectively, each of the
Borrower and any Subsidiary of the Borrower executing an Intercompany Note.
"Default" shall mean any condition or event which, with notice
or lapse of time or both, would constitute an Event of Default.
"Dollar" and "U.S. Dollar" and the sign "$" shall mean lawful
money of the United States of America.
"Environmental Laws" shall mean all federal, state, local and
foreign statutes and codes or regulations, rules or ordinances issued,
promulgated, or approved thereunder, now or hereafter in effect (including,
without limitation, those with respect to asbestos or asbestos containing
material or exposure to asbestos or asbestos containing material), relating to
pollution or protection of the environment and relating to public health and
safety, relating to (a) emissions, discharges, releases or threatened releases
of pollutants, contaminants, chemicals or industrial toxic or hazardous
constituents, substances or wastes, including without limitation, any Hazardous
Substance, petroleum including crude oil or any fraction thereof, any petroleum
product or other waste, chemicals or substances regulated by any Environmental
Law into the environment (including, without limitation, ambient air, surface
water, ground water, land surface or subsurface strata), (b) the manufacture,
processing, distribution, use, generation, treatment, storage, disposal,
transport or handling of any Hazardous Substance, petroleum including crude oil
or any fraction thereof, any petroleum product or other waste, chemicals or
substances regulated by any Environmental Law, or (c) underground storage tanks
and related piping, and emissions, discharges and releases or threatened
releases therefrom, such Environmental Laws to include, without limitation (i)
the Clean Air Act (42 U.S.C. Section 7401 et seq.), (ii) the Clean Water Act
(33 U.S.C. Section 1251 et seq.), (iii) the Resource Conservation and Recovery
Act (42 U.S.C. Section 6901 et seq.), (iv) the
-9-
16
Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.), (v) the
Comprehensive Environmental Response Compensation and Liability Act, as amended
by the Superfund Amendments and Reauthorization Act (42 U.S.C. Section 9601 et
seq.), and (vi) all applicable national and local laws or regulations with
respect to environmental control.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended and in effect from time to time.
"ERISA Affiliate" shall mean, with respect to any Person, each
trade or business (whether or not incorporated) which is a member of a group of
which that Person is a member and which is under common control within the
meaning of the regulations promulgated under Section 414(b) or (c) of the Tax
Code (and for purposes of Tax Code Section 412 or 4980B, a member which is
under common control within the meaning of the regulations promulgated under
Section 414(m) or (o) of the Tax Code).
"Eurodollar Advance" shall mean an Advance made or outstanding
as a Revolving Loan, bearing interest based on the Adjusted LIBO Rate.
"Event of Default" shall have the meaning provided in Article
VIII.
"Executive Officer" shall mean with respect to any Person, the
President, Vice Presidents (including Executive Vice Presidents, Senior Vice
Presidents and other designations within that office), Chief Financial
Officer, Treasurer and any Person holding comparable offices or duties.
"Existing Indebtedness" shall mean the Indebtedness of the
Consolidated Companies to be paid on the Closing Date with the proceeds of the
initial Borrowings under the Revolving Credit Commitments as more particularly
described on Schedule 5.18.
"Facility" or "Facilities" shall mean the Revolving Credit
Commitments or the Letter of Credit Subfacility, as the context may indicate.
"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with member banks
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 Atlanta, 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
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17
the Agent from three Federal funds brokers of recognized standing selected by
the Agent.
"Fee Letter" shall mean that certain engagement letter dated
as of September 15, 1995 by and among Borrower, SunTrust Corporate Finance,
Inc. and the Agent.
"Funded Debt" shall mean, with respect to any Person, all
Indebtedness for money borrowed, Indebtedness evidenced or secured by purchase
money Liens, Capital Leases, conditional sales contracts and similar title
retention debt instruments, (including any current maturities of such
Indebtedness) which by its terms matures more than one year from the date of
creation thereof or which is renewable or extendible at the option of the
obligor to a date beyond one year from the date of determination. The
calculation of Funded Debt shall include (i) all Funded Debt of the
Consolidated Companies, plus (ii) all Funded Debt of other Persons to the
extent guaranteed by a Consolidated Company, to the extent supported by a
letter of credit issued for the account of a Consolidated Company, or as to
which and to the extent which a Consolidated Company or its assets otherwise
have become liable for payment thereof, plus (iii) the redemption amount with
respect to the stock of any Consolidated Company required to be redeemed during
the next succeeding twelve months, plus (iv) Indebtedness outstanding pursuant
to the line of credit established by SunTrust for the benefit of the Borrower
as permitted by Section 7.01 hereof.
"▇▇▇▇▇ Family" shall mean, collectively, (a) ▇.▇. ▇▇▇▇▇, (b)
any of his immediate family members consisting of his spouse and his lineal
descendants (whether natural or adopted) and their spouses, and (c) any trusts
established for the sole benefit of, or partnerships or foundations controlled
by, any of the foregoing. As of the Closing Date, the Persons comprising the
▇▇▇▇▇ Family and who beneficially own any Voting Stock of the Borrower are set
forth on Schedule 8.11 attached hereto.
"GAAP" shall mean generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination.
"Guaranty" shall mean any contractual obligation, contingent
or otherwise, of a Person with respect to any Indebtedness of another Person,
including without limitation, any such Indebtedness, directly or indirectly
guaranteed, endorsed,
-11-
18
co-made or discounted or sold with recourse by that Person, or in respect of
which that Person is otherwise directly or indirectly liable, including
contractual obligations (contingent or otherwise) arising through any agreement
to purchase, repurchase, or otherwise acquire such Indebtedness or any security
therefor, or any agreement to provide funds for the payment or discharge
thereof (whether in the form of loans, advances, stock purchases, capital
contributions or otherwise), or to maintain solvency, assets, level of income,
or other financial condition, or to make any payment other than for value
received. The amount of any Guaranty shall be deemed to be an amount equal to
the stated or determinable amount of the primary obligation in respect of which
guaranty is made (subject to any limitations contained in the terms of such
Guaranty) or, if not so 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.
"Hazardous Substances" shall have the meaning assigned to that
term in the Comprehensive Environmental Response Compensation and Liability Act
of 1980, as amended by the Superfund Amendments and Reauthorization Acts of
1986.
"Intercompany Loan Documents" shall mean, collectively, the
Intercompany Notes and all related loan, subordination, and other agreements
relating in any manner to the Intercompany Loans.
"Intercompany Loans" shall mean, collectively, (i) the loans
more particularly described on Schedule 1.01 and (ii) those loans or other
extensions of credit made by one Consolidated Company to another Consolidated
Company satisfying the terms and conditions set forth in Section 7.01 or as may
otherwise be approved in writing by the Required Lenders.
"Intercompany Note" shall mean a promissory note made by one
of the Consolidated Company to another Consolidated Company substantially in
the form of Exhibit I attached hereto, to evidence an Intercompany Loan.
"Indebtedness" of any Person shall mean, without duplication
(i) all obligations of such Person which in accordance with GAAP would be shown
on the balance sheet of such Person as a liability (including, without
limitation, obligations for borrowed money and for the deferred purchase price
of property or services, and obligations evidenced by bonds, debentures, notes
or other similar instruments); (ii) all Capital Lease Obligations; (iii) all
Guaranties of such Person (including the stated amount of undrawn letters of
credit); (iv) Indebtedness of others secured by any Lien upon property owned by
such Person, whether or not assumed; and (v) obligations or other liabilities
under currency
-12-
19
contracts, Interest Rate Contracts, or similar agreements or combinations
thereof. Notwithstanding the foregoing, in determining the Indebtedness of any
Person, there shall be included all obligations of such Person of the character
referred to in clauses (i) through (v) above deemed to be extinguished under
GAAP but for which such Person remains legally liable.
"Interest Coverage Ratio" shall mean, as of any date of
determination, the ratio of (i) Consolidated EBIT to (ii) Consolidated Interest
Expense, in each case, calculated for the immediately preceding four fiscal
quarters of the Consolidated Companies.
"Interest Period" shall mean as to any Eurodollar Advances,
the interest period selected by the Borrower pursuant to Section 3.04(a)
hereof.
"Interest Rate Contract" shall mean all interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements,
interest rate insurance and other agreements and arrangements designed to
provide protection against fluctuations in interest rates, in each case as the
same may be from time to time amended, restated, renewed, supplemented or
otherwise modified.
"Investment" shall mean, when used with respect to any Person,
any direct or indirect advance, loan or other extension of credit (other than
the creation of receivables in the ordinary course of business) or capital
contribution by such Person (by means of transfers of property to others or
payments for property or services for the account or use of others, or
otherwise) to any Person, or any direct or indirect purchase or other
acquisition by such Person of, or of a beneficial interest in, capital stock,
partnership interests, bonds, notes, debentures or other securities issued by
any other Person other than an Acquisition.
"Investment Grade" shall mean, instruments rated at least Baa3
or the equivalent by ▇▇▇▇▇'▇ and at least BBB- or the equivalent by S&P.
"Lender" or "Lenders" shall mean SunTrust, the other banks and
lending institutions listed on the signature pages hereof, and each assignee
thereof, if any, pursuant to Section 10.06(c).
"Lending Office" shall mean for each Lender, the office such
Lender may designate in writing from time to time to Borrower and the Agent
with respect to each Type of Loan.
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20
"Letter of Credit" shall mean each stand-by letter of credit
issued by the Agent on or after the Closing Date in accordance with Article II
hereof for the purposes of securing the obligations of the Borrower with
respect to workers' compensation insurance, for trade credit or for other
general corporate purposes; provided that, the stated amount of such Letters of
Credit shall not exceed, at any time outstanding, the amount of the Letter of
Credit Subfacility.
"Letter of Credit Exposure" shall mean, with respect to each
Lender, its Pro Rata Share of the aggregate Letter of Credit Obligations.
"Letter of Credit Fee" shall have the meaning set forth in
Section 3.05(b) hereof.
"Letter of Credit Obligations" shall mean, with respect to
Letters of Credit, as at any date of determination, the sum of (i) the maximum
aggregate amount which at such date of determination is available to be drawn
(assuming the conditions for drawing thereunder have been met) under all
Letters of Credit then outstanding, plus (ii) the aggregate amount of all
drawings under Letters of Credit honored by the Agent not theretofore
reimbursed by the Borrower (it being understood that for purposes of any
request for a Revolving Loan pursuant to Section 2.07, there shall be excluded
from the amount determined in accordance with the preceding clause (ii) an
amount equal to the proceeds of such Revolving Loan).
"Letter of Credit Subfacility" shall mean, the portion of the
Revolving Credit Commitments which may be utilized either for Revolving Loans
or Letter of Credit Obligations which amount shall not exceed $12,000,000.
"LIBOR" shall mean, for any Interest Period, with respect to
Eurodollar Advances the offered rate for deposits in U.S. Dollars, for a period
comparable to the Interest Period and in an amount comparable to the Agent's
portion of such Advances, appearing on the Reuters Screen LIBO Page as of 11:00
A.M. (London, England time) on the day that is two London Business Days prior
to the first day of the Interest Period. If two or more of such rates appear
on the Reuters Screen LIBO Page, the rate for that Interest Period shall be the
arithmetic mean of such rates. If the foregoing rate is unavailable from the
Reuters Screen for any reason, then such rate shall be determined by the Agent
from Telerate Page 3750 or, if such rate is also unavailable on such service,
then on any other interest rate reporting service of recognized standing
designated in writing by the Agent to Borrower and the other Lenders; in any
such case rounded, if necessary, to the next higher 1/16 of 1.0%, if the rate
is not such a multiple.
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21
"Lien" shall mean any mortgage, pledge, security interest,
lien, charge, hypothecation, assignment, deposit arrangement, title retention,
preferential property right, trust or other arrangement having the practical
effect of the foregoing and shall include the interest of a vendor or lessor
under any conditional sale agreement, capitalized lease or other title
retention agreement.
"Loans" shall mean, collectively, the Revolving Loans.
"Margin Regulations" shall mean Regulation G, Regulation T,
Regulation U and Regulation X of the Board of Governors of the Federal Reserve
System, as the same may be in effect from time to time.
"Materially Adverse Effect" shall mean any materially adverse
change in (i) the business, results of operations, financial condition, assets
or prospects of the Consolidated Companies, taken as a whole, (ii) the ability
of Borrower to perform its obligations under this Agreement, or (iii) the
enforceability of the Credit Documents. Notwithstanding the foregoing, the
disposition by the Borrower of American Southern Insurance Company and any
adverse effect on the business, results of operations, financial condition,
assets or prospects of the Consolidated Companies directly resulting from such
disposition (other than matters relating to the nonpayment of the Buyer Note),
shall not be considered to have a Materially Adverse Effect.
"Maturity Date" shall mean the earlier of (i) November 6,
1998, and (ii) the date on which all amounts outstanding under this Agreement
have been declared or have automatically become due and payable pursuant to the
provisions of Article VIII.
"▇▇▇▇▇'▇" shall mean ▇▇▇▇▇'▇ Investors Services, Inc. and each
of its successors.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"Net Proceeds" shall mean, with respect to any Asset Sale, (i)
all cash, including cash receivables (when so received) by way of deferred
payment pursuant to a promissory note, a receivable or otherwise (other than
interest payable thereon) received by any Consolidated Company as a result of
or in connection with such transaction and (ii) 75% of all cash proceeds of any
sale or other liquidation of any non-cash proceeds received as consideration of
any Asset Sale (when so received), in each case, net of reasonable sale
expenses, fees and commissions incurred, and any income taxes reasonably
estimated in good faith
-15-
22
by the Borrower and its accountants to be payable by any Consolidated Company
in connection with such Asset Sale and other taxes thereon to the extent such
other taxes are actually paid by any Consolidated Company, and net of any
payment required to be made with respect to the outstanding principal amount
of, premium or penalty, if any, and interest on any Indebtedness (other than
the Loans) secured by a Lien (to the extent permitted by Section 7.02) upon the
asset sold in such Asset Sale; provided that, with respect to Asset Sales
resulting from the sale or other disposition which the Borrower certifies to
the Lenders at the time of the Asset Sale that the Borrower intends to replace
with assets of similar type, value and quality within twelve (12) months of
such Asset Sale, the Net Proceeds of such Asset Sale shall not be deemed to
have been received until such date and shall then be reduced by the amount of
Net Proceeds actually used by the Consolidated Companies for such replacement.
"Notes" shall mean, collectively, the Revolving Credit Notes.
"Note Assignment" shall mean that certain note assignment
originally executed by the Borrower, substantially in the form of Exhibit H
attached hereto, as from time to time executed by other Consolidated Companies
by joinder, whereby the Consolidated Companies party thereto assign to the
Agent, for the benefit of the Lenders, all of the right, title and interest in
and to the Intercompany Loan Documents, as security for the Obligations.
"Notice of Borrowing" shall have the meaning provided in
Section 3.01(a).
"Notice of Conversion/Continuation" shall have the meaning
provided in Section 3.01(b).
"Obligations" shall mean all amounts owing to the Agent or any
Lender pursuant to the terms of this Agreement or any other Credit Document,
including, without limitation, all Loans (including all principal and interest
payments due thereunder), all obligations pursuant to the Letters of Credit,
fees, expenses, indemnification and reimbursement payments, indebtedness,
liabilities, and obligations of the Credit Parties, direct or indirect,
absolute or contingent, liquidated or unliquidated, now existing or hereafter
arising, together with all renewals, extensions, modifications or refinancings
thereof.
"Payment Office" shall mean with respect to payments of
principal, interest, fees or other amounts relating to the Revolving Loans, the
Letter of Credit Obligations and all other Obligations, the office specified as
the "Payment Office" for the
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23
Agent on the signature page of the Agent, or such other location as to which
the Agent shall have given written notice to the Borrower.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Liens" shall mean those Liens expressly permitted
by Section 7.02.
"Person" shall mean any individual, partnership, firm,
corporation, association, joint venture, trust or other entity, or any
government or political subdivision or agency, department or instrumentality
thereof.
"Plan" shall mean any "employee benefit plan" (as defined in
Section 3(3) of ERISA), including, but not limited to, any defined benefit
pension plan, profit sharing plan, money purchase pension plan, savings or
thrift plan, stock bonus plan, employee stock ownership plan, Multiemployer
Plan, or any plan, fund, program, arrangement or practice providing for medical
(including post-retirement medical), hospitalization, accident, sickness,
disability, or life insurance benefits.
"Pro Rata Share" shall mean, with respect to each of the
Revolving Credit Commitments of each Lender, each Loan to be made by, each
Letter of Credit issued thereunder and each payment (including, without
limitation, any payment of principal, interest or fees) to be made to each
Lender, the percentage designated as such Lender's Pro Rata Share of such
Commitments, such Loans, such Letters of Credit or such payments, as
applicable, set forth under the name of such Lender on the respective signature
page for such Lender, in each case as such Pro Rata Share may change from time
to time as a result of assignments or amendments made pursuant to this
Agreement.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System, as the same may be in effect from time
to time.
"Required Lenders" shall mean at any time, the Lenders holding
at least 66 2/3% of the amount of committed funds under the Commitments,
whether or not advanced or, following the termination of all of the
Commitments, the Lenders holding at least 66 2/3% of the aggregate outstanding
Advances and Letter of Credit Obligations at such time.
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"Requirement of Law" for any Person shall mean the articles or
certificate of incorporation and bylaws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation, or
determination of an arbitrator or a court or other governmental authority, in
each case applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.
"Reuters Screen" shall mean, when used in connection with any
designated page and LIBOR, the display page so designated on the Reuter Monitor
Money Rates Service (or such other page as may replace that page on that
service for the purpose of displaying rates comparable to LIBOR).
"Revolving Credit Notes" shall mean, collectively, the
promissory notes evidencing the Revolving Loans in the form attached hereto as
Exhibit A, either as originally executed or as hereafter amended, modified or
supplemented.
"Revolving Loans" shall mean, collectively, the revolving
loans made to the Borrower by the Lenders pursuant to Section 2.01.
"Revolving Credit Commitment" shall mean, at any time for any
Lender, the amount of such commitment set forth opposite such Lender's name on
the signature pages hereof, as the same may be increased or decreased from time
to time as a result of any reduction thereof pursuant to Sections 2.03 or 2.11
any assignment thereof pursuant to Section 10.06(c), or any amendment thereof
pursuant to Section 10.02.
"Security Documents" shall mean, collectively, the Note
Assignment and each other guaranty agreement, mortgage, deed of trust, security
agreement, pledge agreement, or other security or collateral document
guaranteeing or securing the Obligations, now or hereafter executed, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.
"Seller Note" shall mean that certain promissory note, dated
as of October 11, 1991, made by the Borrower in favor of InterRedec Southern
Company, Inc. in the original principal amount of $8,000,000, as increased to
approximately $11,200,000 pursuant to the terms thereof (without giving effect
to any set-off rights thereunder), due on October 11, 1996.
"S&P" shall mean Standard & Poor's Ratings Group, a division
of ▇▇▇▇▇▇-▇▇▇▇, Inc. and its successors.
"Subordinated Debt" shall mean all Indebtedness of Borrower
subordinated to all obligations of Borrower or any other
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Credit Party arising under this Agreement, the Notes, and the Note Assignment,
created, incurred or assumed on terms and conditions satisfactory in all
respects to the Agent and the Required Lenders, including without limitation,
with respect to interest rates, payment terms, maturities, amortization
schedules, covenants, defaults, remedies, and subordination provisions, as
evidenced by the written approval of the Agent and Required Lenders.
"Subsidiary" shall mean, with respect to any Person, any
corporation or other entity (including, without limitation, partnerships, joint
ventures, and associations) regardless of its jurisdiction of organization or
formation, at least a majority of the total combined voting power of all
classes of voting stock or other ownership interests of which shall, at the
time as of which any determination is being made, be owned by such Person,
either directly or indirectly through one or more other Subsidiaries.
"Tax Code" shall mean the Internal Revenue Code of 1986, as
amended and in effect from time to time.
"Taxes" shall mean any present or future taxes, levies,
imposts, duties, fees, assessments, deductions, withholdings or other charges
of whatever nature, including without limitation, income, receipts, excise,
property, sales, transfer, license, payroll, withholding, social security and
franchise taxes now or hereafter imposed or levied by the United States, or any
state, local or foreign government or by any department, agency or other
political subdivision or taxing authority thereof or therein and all interest,
penalties, additions to tax and similar liabilities with respect thereto.
"Telerate" shall mean, when used in connection with any
designated page and LIBOR, the display page so designated on the Dow ▇▇▇▇▇
Telerate Service (or such other page as may replace that page on that service
for the purpose of displaying rates comparable to LIBOR).
"Total Capitalization" shall mean, as of any date of
determination, the sum of (i) Consolidated Funded Debt plus (ii) shareholder's
equity of the Borrower as determined in accordance with GAAP after subtraction
of all treasury stock.
"Type" of Borrowing shall mean a Borrowing consisting of Base
Rate Advances or Eurodollar Advances.
"Voting Stock" shall mean securities of any class or classes,
the holders of which are entitled to elect all of the corporate directors (or
Persons performing similar functions).
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SECTION 1.02. ACCOUNTING TERMS AND DETERMINATION. Unless
otherwise defined or specified herein, all accounting terms shall be construed
herein, all accounting determinations hereunder shall be made, all financial
statements required to be delivered hereunder shall be prepared, and all
financial records shall be maintained in accordance with, GAAP.
SECTION 1.03. OTHER DEFINITIONAL TERMS. The words "hereof",
"herein" and "hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Article, Section, Schedule, Exhibit and like
references are to this Agreement unless otherwise specified.
SECTION 1.04. EXHIBITS AND SCHEDULES. All Exhibits and
Schedules attached hereto are by reference made a part hereof.
ARTICLE II.
REVOLVING LOANS AND LETTERS OF CREDIT
SECTION 2.01. COMMITMENT; USE OF PROCEEDS.
(a) Subject to and upon the terms and conditions herein
set forth, each Lender severally agrees to make to Borrower from time to time
on and after the Closing Date, but prior to the Maturity Date, Revolving Loans
in an aggregate amount outstanding at any time not to exceed such Lender's
Revolving Credit Commitment minus such Lender's Letter of Credit Exposure.
Borrower shall be entitled to repay and reborrow Revolving Loans in accordance
with the provisions hereof.
(b) Each Revolving Loan shall, at the option of Borrower,
be made or continued as, or converted into, part of one or more Borrowings that
shall consist entirely of Base Rate Advances or Eurodollar Advances. The
aggregate principal amount of each Borrowing of Revolving Loans comprised of
Eurodollar Advances shall be not less than $1,500,000 or a greater integral
multiple of $250,000, and the aggregate principal amount of each Borrowing of
Revolving Loans comprised of Base Rate Advances shall be not less than $300,000
or a greater integral multiple of $50,000. Notwithstanding the foregoing, all
Revolving Loans made pursuant to Section 2.07 hereof shall be in an amount
equal to the draw upon the Letter of Credit to be repaid with such Revolving
Loan. At no time shall the number of Borrowings outstanding under this Article
II exceed six; provided that, for the purpose of determining the number of
Borrowings outstanding and the minimum amount for Borrowings resulting from
conversions or continuations,
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all Borrowings of Base Rate Advances under this Facility shall be considered as
one Borrowing.
(c) The proceeds of Revolving Loans shall be used solely
for the following purposes:
(i) Approximately $16,000,000 shall be used initially to
repay the Existing Indebtedness outstanding on the Closing Date; and
(ii) All other amounts shall be used by the Borrower as
working capital, to finance acquisitions permitted hereunder, for
other general corporate purposes of the Borrower and to make
Intercompany Loans to its Subsidiaries for use by such Subsidiaries as
working capital, to finance acquisitions permitted hereunder, to make
other Intercompany Loans as provided herein, and for other general
corporate purposes of such Subsidiaries.
SECTION 2.02. NOTES; REPAYMENT OF PRINCIPAL.
(a) The Borrower's obligations to pay the principal of,
and interest on, the Revolving Loans to each Lender shall be evidenced by the
records of the Agent and such Lender and by the Revolving Credit Note payable
to such Lender (or the assignor of such Lender) completed in conformity with
this Agreement.
(b) All Borrowings outstanding under the Revolving
Credit Commitments and all Letter of Credit Obligations shall be due and
payable in full on the Maturity Date.
SECTION 2.03. VOLUNTARY REDUCTION OF REVOLVING CREDIT
COMMITMENTS. Upon at least three (3) Business Days' prior telephonic notice
(promptly confirmed in writing) to the Agent, Borrower shall have the right,
without premium or penalty, to terminate the unutilized Revolving Credit
Commitments, in part or in whole, provided that (i) any such termination shall
apply to proportionately and permanently reduce the Revolving Credit
Commitments of each of the Lenders, and (ii) any partial termination pursuant
to this Section 2.03 shall be in an amount of at least $1,000,000 and integral
multiples of $1,000,000.
SECTION 2.04. MANDATORY REDUCTION OF REVOLVING CREDIT
COMMITMENTS UPON ASSET SALE. Promptly, and in any event within five (5)
Business Days, upon receipt of the Net Proceeds of any Asset Sale, the Borrower
shall permanently and proportionately reduce the Revolving Credit Commitments
by an amount equal to such Net Proceeds, if the aggregate amount of Net
Proceeds so received, when aggregated with the total amount of Net Proceeds
previously
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received by the Borrower on or after the Closing Date (or after the most recent
reduction of the aggregate Revolving Credit Commitments pursuant to this
Section 2.04), exceeds $1,000,000. The Borrower shall not be required to apply
the Net Proceeds of any sale or other disposition of American Southern
Insurance Company to the reduction of the Revolving Loan Commitments unless a
Default or Event of Default exists or has resulted from such Asset Sale. In
addition, with respect to Asset Sales resulting from the sale or other
disposition of assets acquired by a Consolidated Company in connection with an
Acquisition which assets the Borrower certifies in writing to the Lenders at
the time of such Asset Sale are being sold due to the fact that such assets
represent excess capacity or are otherwise redundant to the business of the
Consolidated Companies (a "Redundancy Sale"), the Net Proceeds of such
Redundancy Sale shall be applied to repay the outstanding Loans but shall not
permanently reduce the Revolving Credit Commitments unless and until the
aggregate amount of Net Proceeds of all Redundancy Sales since the Closing Date
exceeds $3,000,000. To the extent that the sum of the Borrowings outstanding
under the Revolving Credit Commitments plus the Letter of Credit Obligations
are in excess of the reduced amount of the Revolving Credit Commitments upon
such reduction, the Borrower shall immediately repay any such excess Borrowings
and, if the outstanding Letter of Credit Obligations still exceed the reduced
amount of the Revolving Credit Commitments, shall cash-collateralize such
excess Letter of Credit Obligations on terms and conditions reasonably
satisfactory to the Agent.
SECTION 2.05. LETTER OF CREDIT SUBFACILITY. Subject to, and
upon the terms and conditions, and in reliance upon the representations and
warranties of the Borrower set forth in this Agreement, in addition to
requesting that the Lenders make Revolving Loans pursuant to Section 2.01, the
Borrower may request, in accordance with the provisions of this Section 2.05
and Section 2.06, that on and after the Closing Date, the Agent issue a Letter
or Letters of Credit for the account of the Borrower; provided that (i) no
Letter of Credit shall have an expiration date that is later than ten days
prior to the Maturity Date; (ii) each Letter of Credit issued by the Agent
shall be in a stated amount of at least $250,000; (iii) the Borrower shall not
request that the Agent issue any Letter of Credit, if, after giving effect to
such issuance, the Letter of Credit Obligations plus the then outstanding
aggregate principal amount of Revolving Loans would exceed the aggregate amount
of the Revolving Credit Commitments; and (iv) the Borrower shall not request
the issuance of any Letter of Credit if, after giving effect to such issuance,
the aggregate Letter of Credit Obligations would exceed the Letter of Credit
Subfacility.
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SECTION 2.06. NOTICE OF ISSUANCE OF LETTER OF CREDIT; AGREEMENT TO ISSUE.
(a) Whenever the Borrower desires the issuance of a
Letter of Credit, it shall, in addition to any application and documentation
procedures customarily required by the Agent for the issuance of such Letter of
Credit, deliver to the Agent a written notice no later than 11:00 A.M.
(Atlanta, Georgia time) at least five (5) days in advance of the proposed date
of issuance. Each such notice shall specify (i) the proposed date of issuance
(which shall be a Business Day); (ii) the face amount of the Letter of Credit;
(iii) the expiration date of the Letter of Credit; and (iv) the name and
address of the beneficiary with respect to such Letter of Credit and shall
attach a precise description of the documentation and a verbatim text of any
certificate to be presented by the beneficiary of such Letter of Credit which
would require the Agent to make payment under the Letter of Credit, provided
that the Agent may require changes in any such documents and certificates in
accordance with its customary letter of credit practices, and provided further,
that no Letter of Credit shall require payment against a conforming draft to be
made thereunder on the same Business Day that such draft is presented if such
presentation is made after 11:00 A.M. (Atlanta, Georgia time). In determining
whether to pay under any Letter of Credit, the Agent shall be responsible only
to determine that the documents and certificate required to be delivered under
its Letter of Credit have been delivered, and that they comply on their face
with the requirements of the Letter of Credit. Promptly after receiving the
notice of issuance of a Letter of Credit, the Agent shall notify each Lender of
such Lender's respective participation therein, determined in accordance with
its respective Pro Rata Share of the Revolving Credit Commitments In the event
that the written request of the Borrower for a Letter of Credit hereunder is
delivered at least seven (7) Business Days prior to the proposed date of
issuance of such Letter of Credit and is accompanied by a request for a prior
review of such Letter of Credit, the Agent shall deliver to the Borrower for
the Borrower's review and comment, a copy of such proposed Letter of Credit at
least two (2) Business Days prior to the proposed date of issuance thereof.
(b) The Agent agrees, subject to the terms and conditions
set forth in this Agreement, to issue for the account of the Borrower a Letter
of Credit in a face amount equal to the face amount requested under paragraph
(a) above, following its receipt of a notice required by Section 2.06(a).
Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby agrees to, have irrevocably purchased from the Agent a
participation in such Letter of Credit and any drawing thereunder in an amount
equal to such Lender's Pro Rata Share of
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the Revolving Credit Commitments multiplied by the face amount of such Letter
of Credit. The Agent shall promptly forward a copy of each Letter of Credit
issued hereunder to each Lender and to the Borrower.
SECTION 2.07. PAYMENT OF AMOUNTS DRAWN UNDER LETTER OF CREDIT.
(a) In the event of any request for a drawing under any
Letter of Credit by the beneficiary thereof, the Agent shall notify the
Borrower and the Lenders as promptly as possible on the date on which the Agent
intends to honor such drawing, and the Borrower shall reimburse the Agent on
the day on which such drawing is honored in an amount, in same day funds, equal
to the amount of such drawing, provided that anything contained in this
Agreement to the contrary notwithstanding, unless the Borrower shall have
notified the Agent prior to 11:30 A.M. (Atlanta, Georgia time) on the Business
Day on which such drawing is honored, that the Borrower intends to reimburse
the Agent for the amount of such drawing in funds other than the proceeds of
Revolving Loans, the Borrower shall be deemed to have timely given a Notice of
Borrowing to the Agent requesting Revolving Loans which are Base Rate Advances
on the date on which such drawing is honored in an amount equal to the amount
of such drawing, and the Lenders shall by 1:00 P.M. (Atlanta, Georgia time) on
the date of such drawing, make Revolving Loans which are Base Rate Advances in
the amount of such drawing, the proceeds of which shall be applied directly by
the Agent to reimburse itself for the amount of such drawing, provided that for
the purposes solely of such Borrowing, the conditions and precedents set forth
in Sections 4.01 and 4.02 hereof shall not be applicable, and provided further
that if for any reason proceeds of the Revolving Loans are not received by the
Agent on such date in the amount equal to the amount of such drawing, the
Borrower shall reimburse the Agent on the Business Day immediately following
the date of such drawing in an amount, in Dollars and immediately available
funds, equal to the excess of the amount of such drawing over the amount of
such Revolving Loans, if any, which are so received, plus accrued interest on
the amount at the applicable rate of interest for Base Rate Advances.
(b) Notwithstanding any provision of this Agreement to
the contrary, to the extent that any Letter of Credit or portion thereof
remains outstanding on the Maturity Date, the parties hereby agree that the
beneficiary or beneficiaries thereof shall be deemed to have made a drawing of
all available amounts pursuant to such Letters of Credit on the Maturity Date,
which amounts shall be reimbursed to the Agent as set forth above and
thereafter held by the Agent as cash collateral for its remaining obligations
pursuant to such Letters of Credit.
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SECTION 2.08. PAYMENT BY LENDERS. In the event that the
Borrower shall fail to reimburse the Agent as provided in Section 2.07 by
borrowing Revolving Loans, or otherwise providing an amount equal to the amount
of any drawing honored by the Agent pursuant to any Letter of Credit issued by
it, the Agent shall promptly notify each Lender of the unreimbursed amount of
such drawing and of such Lender's respective participation therein. Each
Lender shall make available to the Agent an amount equal to its respective
participation, in Dollars and in immediately available funds, at the office of
the Agent specified in such notice not later than 1:00 P.M. (Atlanta, Georgia
time) on the Business Day after the date notified by the Agent. In the event
that any such Lender fails to make available to the Agent the amount of such
Lender's participation in such Letter of Credit, the Agent shall be entitled to
recover such amount on demand from such Lender together with interest as
provided for in Section 3.02(c). The Agent shall distribute to each other
Lender which has paid all amounts payable under this Section with respect to
any Letter of Credit, such Lender's Pro Rata Share of all payments received by
the Agent from the Borrower in reimbursement of drawings honored by the Agent
under such Letter of Credit when such payments are received.
SECTION 2.09 OBLIGATIONS ABSOLUTE. The obligation of the
Borrower to reimburse the Agent for drawings made under Letters of Credit
issued for the account of the Borrower and the Lenders' obligation to honor
their participations purchased therein shall be unconditional and irrevocable
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including without limitation, the following circumstances:
(a) Any lack of validity or enforceability of any Letter
of Credit;
(b) The existence of any claim, set-off, defense or
other right which the Borrower or any Subsidiary or Affiliate of the
Borrower may have at any time against a beneficiary or any transferee
of any Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), any Lender or any other
Person, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including without
limitation any underlying transaction between the Borrower or any of
its Subsidiaries and Affiliates and the beneficiary for which such
Letter of Credit was procured); provided that nothing in this Section
shall affect the right of the Borrower to seek relief against any
beneficiary, transferee, Lender or any other Person in any action or
proceeding or to bring a counterclaim in any suit involving such
Persons;
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(c) Any draft, demand, certificate or any other document
presented under any Letter of Credit proving to be forged, fraudulent
or invalid in any respect or any statement therein being untrue or
inaccurate in any respect;
(d) Payment by the Agent under any Letter of Credit
against presentation of a demand, draft or certificate or other
document which does not comply with the terms of such Letter of
Credit;
(e) Any other circumstance or happening whatsoever which
is similar to any of the foregoing; or
(f) the fact that a Default or an Event of Default shall
have occurred and be continuing.
The provisions of this Section 2.09 are intended to apply only
to the obligation of the Borrower to reimburse the Agent for drawings honored
by the Agent under Letters of Credit and shall in no way impair the ability of
the Borrower to seek relief against the Agent for any gross negligence or
willful misconduct of the Agent in connection with any Letter of Credit,
including without limitation, any matters set forth in this Section 2.09 to the
extent that such matters constitute gross negligence or willful misconduct on
the part of the Agent.
SECTION 2.10. INDEMNIFICATION; NATURE OF AGENT'S DUTIES.
(a) In addition to amounts payable elsewhere provided
in this Agreement, without duplication, the Borrower hereby agrees to protect,
indemnify, pay and save the Agent and each Lender harmless from and against any
and all claims, demands, liabilities, damages, losses, costs, charges and
reasonable expenses (including reasonable attorney's fees and disbursements)
which the Agent or any Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit for the account
of the Borrower, other than as a result of the gross negligence or willful
misconduct of the Agent or such Lender, as the case may be; (ii) the failure of
the Agent to honor a drawing under any Letter of Credit due to any act or
omission (whether rightful or wrongful) of any present or future de jure or de
facto government or governmental authority; or (iii) any confirmation of any
Letter of Credit obtained by the Agent with the consent of the Borrower.
(b) As between the Borrower and the Agent, the Borrower
assumes all risk of the acts and omissions of, or misuse of, the Letters of
Credit issued by the Agent, by the respective beneficiaries of such Letters of
Credit, other than losses
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resulting from the gross negligence and willful misconduct of the Agent. In
furtherance and not in limitation of the foregoing but subject to the exception
for the Agent's gross negligence or willful misconduct set forth above, the
Agent shall not be responsible (i) for the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of such Letters of Credit,
even if it should in fact prove to be in any or all respects insufficient,
inaccurate, fraudulent or forged or otherwise invalid; (ii) for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any such Letter of Credit or the rights or benefits
thereunder or proceeds thereof in whole or in part which may prove to be
invalid or ineffective for any reason; (iii) for failure of the beneficiary of
any such Letter of Credit to comply fully with the conditions required in order
to draw upon such Letter of Credit; (iv) for errors, omissions, interruptions
or delays in transmission or delivery of any messages, by mail, cable,
telegraph, telex, telecopy or otherwise; (v) for good faith errors in
interpretation of technical terms; (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit; and (viii) for
any consequences arising from causes beyond the control of the Agent.
(c) Notwithstanding any other provision contained in this
Agreement, the Agent shall not be obligated to issue any Letter of Credit, nor
shall any Lender be obligated to purchase its participation in any Letter of
Credit to be issued hereunder, if the issuance of such Letter of Credit or
purchase of such participation shall have become unlawful or prohibited by
compliance by Agent or such Lender in good faith with any law, governmental
rule, guideline, request, order, injunction, judgment or decree (whether or not
having the force of law); provided that in the case of the obligation of a
Lender to purchase such participation, such Lender shall have notified the
Agent to such effect in writing at least ten (10) Business Days' prior to the
issuance thereof by the Agent, which notice shall relieve the Agent of its
obligation to issue such Letter of Credit pursuant to Section 2.05 and Section
2.06 hereof.
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ARTICLE III.
GENERAL LOAN TERMS
SECTION 3.01. FUNDING NOTICES.
(a) Whenever Borrower desires to make a Borrowing with
respect to the Revolving Credit Commitments (other than one resulting from a
conversion or continuation pursuant to Section 3.01(b)), it shall give the
Agent prior written notice (or telephonic notice promptly confirmed in writing)
of such Borrowing substantially in the form of Exhibit B, with appropriate
insertions (a "Notice of Borrowing"), such Notice of Borrowing to be given at
its Payment Office (x) prior to 11:00 A.M. (local time for the Agent) on the
Business Day which is the requested date of such Borrowing in the case of Base
Rate Advances, and (y) prior to 12:00 noon (local time for the Agent) three
Business Days prior to the requested date of such Borrowing in the case of
Eurodollar Advances. Notices received after 12:00 noon shall be deemed
received on the next Business Day. Each Notice of Borrowing shall be
irrevocable and shall specify the aggregate principal amount of the Borrowing,
the date of Borrowing (which shall be a Business Day), and whether the
Borrowing is to consist of Base Rate Advances or Eurodollar Advances and (in
the case of Eurodollar Advances) the Interest Period to be applicable thereto.
(b) Whenever Borrower desires to convert all or a portion
of an outstanding Borrowing under the Revolving Credit Commitments consisting
of Base Rate Advances into a Borrowing consisting of Eurodollar Advances, or to
continue outstanding a Borrowing consisting of Eurodollar Advances for a new
Interest Period, it shall give the Agent at least three Business Days' prior
written notice (or telephonic notice promptly confirmed in writing) of each
such Borrowing to be converted into or continued as Eurodollar Advances. Such
notice, substantially in the form of Exhibit C attached hereto, with
appropriate insertions (a "Notice of Conversion/Continuation"), shall be given
prior to 12:00 noon (local time for the Agent) on the date specified at the
Payment Office of the Agent. Each such Notice of Conversion/Continuation shall
be irrevocable and shall specify the aggregate principal amount of the Advances
to be converted or continued, the date of such conversion or continuation and
the Interest Period to be applicable thereto. If, upon the expiration of any
Interest Period in respect of any Borrowing consisting of Eurodollar Advances,
Borrower shall have failed to deliver the Notice of Conversion/Continuation,
Borrower shall be deemed to have elected to convert or continue such Borrowing
to a Borrowing consisting of Base Rate Advances. So long as any Executive
Officer of Borrower has knowledge that any Default or Event of Default shall
have
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occurred and be continuing, no Borrowing may be converted into or continued as
(upon expiration of the current Interest Period) Eurodollar Advances unless the
Agent and each of the Lenders shall have otherwise consented in writing. No
conversion of any Borrowing of Eurodollar Advances shall be permitted except on
the last day of the Interest Period in respect thereof.
(c) Without in any way limiting Borrower's obligation to
confirm in writing any telephonic notice, the Agent may act without liability
upon the basis of telephonic notice believed by the Agent in good faith to be
from Borrower prior to receipt of written confirmation. In each such case,
Borrower hereby waives the right to dispute the Agent's record of the terms of
such telephonic notice.
(d) The Agent shall promptly (and in any event by the
same time on the next succeeding Business Day as such notice is received) give
each Lender notice by telephone (confirmed in writing) or by telex, telecopy or
facsimile transmission of the matters covered by the notices given to the Agent
pursuant to this Section 3.01 with respect to the Revolving Credit Commitments.
SECTION 3.02. DISBURSEMENT OF FUNDS.
(a) No later than 11:00 a.m. (local time for the Agent)
in the case of a Borrowing consisting of Eurodollar Advances and no later than
12:00 Noon (local time for the Agent) in the case of a Borrowing consisting of
Base Rate Advances on the date of each Borrowing pursuant to the Revolving
Credit Commitments (other than one resulting from a conversion or continuation
pursuant to Section 3.01(b)), each Lender will make available its Pro Rata
Share of the amount of such Borrowing in immediately available funds at the
Payment Office of the Agent. The Agent will make available to Borrower the
aggregate of the amounts (if any) so made available by the Lenders to the Agent
in a timely manner by crediting such amounts to Borrower's demand deposit
account maintained with the Agent or at Borrower's option, by effecting a wire
transfer of such amounts to Borrower's account specified by the Borrower, by
the close of business on such Business Day. In the event that the Lenders do
not make such amounts available to the Agent by the time prescribed above, but
such amount is received later that day, such amount may be credited to Borrower
in the manner described in the preceding sentence on the next Business Day
(with interest on such amount to begin accruing hereunder on such next Business
Day).
(b) Unless the Agent shall have been notified by any
Lender prior to the date of a Borrowing that such Lender does not intend to
make available to the Agent such Lender's portion of the Borrowing to be made
on such date, the Agent may assume that such
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Lender has made such amount available to the Agent on such date and the Agent
may make available to Borrower a corresponding amount. If such corresponding
amount is not in fact made available to the Agent by such Lender on the date of
Borrowing, the Agent shall be entitled to recover such corresponding amount on
demand from such Lender together with interest at the Federal Funds Rate. If
such Lender does not pay such corresponding amount forthwith upon the Agent's
demand therefor, the Agent shall promptly notify Borrower, and Borrower shall
immediately pay such corresponding amount to the Agent together with interest
at the rate specified for the Borrowing which includes such amount paid and any
amounts due under Section 3.12 hereof. Nothing in this subsection shall be
deemed to relieve any Lender from its obligation to fund its Commitments
hereunder or to prejudice any rights which Borrower may have against any Lender
as a result of any default by such Lender hereunder.
(c) All Borrowings under the Revolving Credit Commitments
shall be loaned by the Lenders on the basis of their Pro Rata Share of the
Revolving Credit Commitments. No Lender shall be responsible for any default
by any other Lender in its obligations hereunder, and each Lender shall be
obligated to make the Loans provided to be made by it hereunder, regardless of
the failure of any other Lender to fund its Commitment hereunder.
SECTION 3.03. INTEREST.
(a) Borrower agrees to pay interest in respect of all
unpaid principal amounts of the Revolving Loans from the respective dates such
principal amounts were advanced to maturity (whether by acceleration, notice of
prepayment or otherwise) at rates per annum equal to the applicable rates
indicated below:
(i) For Base Rate Advances--The Base Rate in effect from
time to time plus the Applicable Margin; and
(ii) For Eurodollar Advances--The relevant Adjusted LIBO
Rate plus the Applicable Margin.
(b) Overdue principal and, to the extent not prohibited
by applicable law, overdue interest, in respect of the Revolving Loans, and all
other overdue amounts owing hereunder, shall bear interest from each date that
such amounts are overdue:
(i) in the case of overdue principal and interest with
respect to all Loans outstanding as Eurodollar Advances, at the
greater of (A) the rate otherwise applicable for the then-current
Interest Period plus an additional two percent (2.0%) per annum or
(B) the rate
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in effect for Base Rate Advances plus an additional two percent (2.0%)
per annum; and
(ii) in the case of overdue principal and interest with
respect to all other Loans outstanding as Base Rate Advances, and all
other Obligations hereunder (other than Loans), at a rate equal to the
applicable Base Rate plus an additional two percent (2.0%) per annum.
(c) Interest on each Loan shall accrue from and including
the date of such Loan to but excluding the date of any repayment thereof;
provided that, if a Loan is repaid on the same day made, one day's interest
shall be paid on such Loan. Interest on all outstanding Base Rate Advances
shall be payable quarterly in arrears on the last day of each calendar quarter,
commencing on December 31, 1995. Interest on all outstanding Eurodollar
Advances shall be payable on the last day of each Interest Period applicable
thereto, and, in the case of Eurodollar Advances having an Interest Period in
excess of three months, on each three month anniversary of the initial date of
such Interest Period. Interest on all Loans shall be payable on any conversion
of any Advances comprising such Loans into Advances of another Type, prepayment
(on the amount prepaid), at maturity (whether by acceleration, notice of
prepayment or otherwise) and, after maturity, on demand.
(d) The Agent, upon determining the Adjusted LIBO Rate
for any Interest Period, shall promptly notify by telephone (confirmed in
writing) or in writing Borrower and the other Lenders. Any such determination
shall, absent manifest error, be final, conclusive and binding for all
purposes.
SECTION 3.04. INTEREST PERIODS.
(a) In connection with the making or continuation of, or
conversion into, each Borrowing of Eurodollar Advances, Borrower shall select
an Interest Period to be applicable to such Eurodollar Advances, which Interest
Period shall be either a 1, 2, 3 or 6 month period.
(b) Notwithstanding paragraph (a) of this Section 3.04:
(i) The initial Interest Period for any Borrowing of
Eurodollar Advances shall commence on the date of such Borrowing
(including the date of any conversion from a Borrowing consisting of
Base Rate Advances) and each Interest Period occurring thereafter in
respect of such Borrowing shall commence on the day on which the next
preceding Interest Period expires;
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(ii) 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
in respect of Eurodollar Advances would otherwise expire on a day that
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;
(iii) Any Interest Period in respect of Eurodollar Advances
which begins on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period shall,
subject to part (iv) below, expire on the last Business Day of such
calendar month; and
(iv) No Interest Period with respect to the Loans shall
extend beyond the Maturity Date.
SECTION 3.05. FEES.
(a) Borrower shall pay to the Agent, for the ratable
benefit of each Lender based upon its respective Pro Rata Share, a commitment
fee (the "Commitment Fee") for the period commencing on the Closing Date and
ending on the Maturity Date, payable quarterly in arrears on the last day of
each calendar quarter, commencing on December 31, 1995, and on the Maturity
Date, equal to the Applicable Commitment Percentage multiplied by the average
daily unused portion of the Revolving Credit Commitments.
(b) The Borrower shall pay to the Agent, for the account
of itself and the Lenders, a letter of credit fee equal to the Applicable
Margin for Eurodollar Advances multiplied by the average daily Letter of Credit
Obligations (the "Letter of Credit Fee"). The Letter of Credit Fee shall be
payable by the Borrower quarterly, in arrears, commencing on December 31, 1995
and continuing thereafter on the last day of each succeeding calendar quarter
and on the Maturity Date.
(c) In addition to the Letter of Credit Fee, the Borrower
shall pay to the Agent on the date of the issuance of each Letter of Credit and
on each anniversary date thereafter during which such Letter of Credit remains
outstanding, in advance, an administrative fee with respect to such Letter of
Credit equal to one twentieth of one percent (0.05%) multiplied by the face
amount of such Letter of Credit.
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(d) Borrower shall pay to the Agent and its Affiliates
such structuring and syndication fees and annual administrative fees in the
respective amounts and on the dates set forth in the Fee Letter.
SECTION 3.06. VOLUNTARY PREPAYMENTS OF BORROWINGS.
(a) Borrower may, at its option, prepay Borrowings
consisting of Base Rate Advances at any time in whole, or from time to time in
part, in amounts aggregating $500,000 or any greater integral multiple of
$50,000, by paying the principal amount to be prepaid together with interest
accrued and unpaid thereon to the date of prepayment. Borrowings consisting of
Eurodollar Advances may be prepaid, at Borrower's option, in whole, or from
time to time in part, in amounts aggregating $1,500,000 or any greater integral
multiple of $250,000, by paying the principal amount to be prepaid, together
with interest accrued and unpaid thereon to the date of prepayment, and all
compensation payments pursuant to Section 3.12 if such prepayment is made on a
date other than the last day of an Interest Period applicable thereto. Each
such optional prepayment shall be applied in accordance with Section 3.06(c)
below.
(b) Borrower shall give written notice (or telephonic
notice confirmed in writing) to the Agent of any intended prepayment of the
Revolving Loans (i) by 11:00 A.M. (local time for the Agent) on the Business
Day of any prepayment of Base Rate Advances and (ii) not less than three
Business Days prior to any prepayment of Eurodollar Advances. Such notice,
once given, shall be irrevocable. Upon receipt of such notice of prepayment
pursuant to the first sentence of this paragraph (b), the Agent shall promptly
(and in any event by the same time on the next succeeding Business Day as such
notice is received) notify each Lender of the contents of such notice and of
such Lender's Pro Rata Share of such prepayment.
(c) Borrower, when providing notice of prepayment
pursuant to Section 3.06(b), may designate the Types of Advances and the
specific Borrowing or Borrowings which are to be prepaid, provided that (i) if
any prepayment of Eurodollar Advances made pursuant to a single Borrowing of
the Revolving Loans shall reduce the outstanding Advances made pursuant to such
Borrowing to an amount less than $1,500,000, such Borrowing shall immediately
be converted into Base Rate Advances; and (ii) each prepayment made pursuant to
a single Borrowing shall be applied pro rata among the Loans comprising such
Borrowing. In the absence of a designation by Borrower, the Agent shall,
subject to the foregoing, make such designation in its discretion but using
reasonable efforts to avoid funding losses to the Lenders pursuant to Section
3.12 subject to the last sentence of Section 3.15. All voluntary
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prepayments shall be applied to the payment of interest before application to
principal.
SECTION 3.07. PAYMENTS, ETC.
(a) Except as otherwise specifically provided herein, all
payments under this Agreement and the other Credit Documents, shall be made
without defense, set-off or counterclaim to the Agent not later than 12:00 noon
(local time for the Agent) on the date when due and shall be made in Dollars in
immediately available funds at its Payment Office.
(b) (i) All such payments shall be made free and clear of
and without deduction or withholding for any Taxes in respect of this
Agreement, the Notes or other Credit Documents, or any payments of principal,
interest, fees or other amounts payable hereunder or thereunder (but excluding,
except as provided in paragraph (iii) hereof, any Taxes (x) on the overall net
income of the Agent or the Lenders or (y) any Taxes in the form of franchise
taxes, in each case, imposed pursuant to the laws of the jurisdiction in which
the principal executive office or appropriate Lending Office of such Lender or
the Agent is located). If any Taxes are so levied or imposed, Borrower agrees
(A) to pay the full amount of such Taxes, and such additional amounts as may be
necessary so that every net payment of all amounts due hereunder and under the
Notes and other Credit Documents, after withholding or deduction for or on
account of any such Taxes (including additional sums payable under this Section
3.07), will not be less than the full amount provided for herein had no such
deduction or withholding been required, (B) to make such withholding or
deduction and (C) to pay the full amount deducted to the relevant authority in
accordance with applicable law. Borrower will furnish to the Agent and each
Lender, within 30 days after the date the payment of any Taxes is due pursuant
to applicable law, certified copies of tax receipts evidencing such payment by
Borrower. Borrower will indemnify and hold harmless the Agent and each Lender
and reimburse the Agent and each Lender upon written request for the amount of
any Taxes so levied or imposed and paid by the Agent or Lender and any
liability (including penalties, interest and expenses) arising therefrom or
with respect thereto, whether or not such Taxes were correctly or illegally
asserted; provided that, the Borrower shall not be required to indemnify any
Lender or the Agent for any Tax applicable to such Lender or the Agent on the
Closing Date. A certificate as to the amount of such payment by such Lender or
the Agent shall constitute prima facie evidence of the matters contained
therein.
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(ii) Each Lender that is organized under the laws of any
jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) agrees to furnish to Borrower and the
Agent, prior to the time it becomes a Lender hereunder, two copies of either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 or any successor forms thereto (wherein such Lender claims entitlement to
complete exemption from or reduced rate of U.S. Federal withholding tax on
interest paid by Borrower hereunder) and to provide to Borrower and the Agent a
new Form 4224 or Form 1001 or any successor forms thereto if any previously
delivered form is found to be incomplete or incorrect in any material respect
or upon the obsolescence of any previously delivered form; provided, however,
that no Lender shall be required to furnish a form under this paragraph (ii)
after the date that it becomes a Lender hereunder if it is not entitled to
claim an exemption from or a reduced rate of withholding under applicable law.
(iii) Borrower shall also reimburse the Agent and each
Lender, upon written request, for any Taxes imposed (including, without
limitation, Taxes imposed on the overall net income of the Agent or Lender or
its applicable Lending Office pursuant to the laws of the jurisdiction in which
the principal executive office or the applicable Lending Office of the Agent or
Lender is located) as the Agent or Lender shall determine are payable by the
Agent or Lender in respect of amounts paid by or on behalf of Borrower to or on
behalf of the Agent or Lender pursuant to paragraph (i) hereof.
(c) Subject to Section 3.04(ii), whenever any payment to
be made hereunder or under any Note 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
thereon shall be payable at the applicable rate during such extension.
(d) All computations of interest and fees 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 or fees are payable (to the extent computed on the basis of days
elapsed). Interest on Base Rate Advances shall be calculated based on the Base
Rate from and including the date of such Loan to but excluding the date of the
repayment or conversion thereof. Interest on Eurodollar Advances shall be
calculated as to each Interest Period from and including the first day thereof
to but excluding the last day thereof. Each determination by the Agent of an
interest rate or fee hereunder shall be made in good faith and shall constitute
prima facie evidence of the matters contained therein.
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(e) Payment by the Borrower to the Agent in accordance
with the terms of this Agreement shall, as to the Borrower, constitute payment
to the Lenders under this Agreement.
SECTION 3.08. INTEREST RATE NOT ASCERTAINABLE, ETC. In the
event that the Agent shall have determined (which determination shall be made
in good faith and, absent manifest error, shall be final, conclusive and
binding upon all parties) that on any date for determining the Adjusted LIBO
Rate for any Interest Period, by reason of any changes arising after the date
of this Agreement affecting the London interbank market, or the Agent's
position in such market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition of
Adjusted LIBO Rate, then, and in any such event, the Agent shall forthwith give
notice (by telephone confirmed in writing) to Borrower and to the Lenders, of
such determination and a summary of the basis for such determination. Until
the Agent notifies Borrower that the circumstances giving rise to the
suspension described herein no longer exist (which notice Agent agrees to give
to the Borrower upon Agent obtaining knowledge that such circumstances have
ceased to exist), the obligations of the Lenders to make or permit portions of
the Revolving Loans to remain outstanding past the last day of the then current
Interest Periods as Eurodollar Advances shall be suspended, and such affected
Advances shall bear the same interest as Base Rate Advances.
SECTION 3.09. ILLEGALITY.
(a) In the event that any Lender shall have determined
(which determination shall be made in good faith and, absent manifest error,
shall be final, conclusive and binding upon all parties) at any time that the
making or continuance of any Eurodollar Advance has become unlawful by
compliance by such Lender in good faith with any applicable law, governmental
rule, regulation, guideline or order (whether or not having the force of law
and whether or not failure to comply therewith would be unlawful), then, in any
such event, the Lender shall give prompt notice (by telephone confirmed in
writing) to Borrower and to the Agent of such determination and a summary of
the basis for such determination (which notice the Agent shall promptly
transmit to the other Lenders).
(b) Upon the giving of the notice to Borrower referred to
in subsection (a) above, (i) Borrower's right to request from such Lender, and
such Lender's obligation to make Eurodollar Advances shall be immediately
suspended, and such Lender shall make an Advance as part of the requested
Borrowing of Eurodollar Advances as a Base Rate Advance, which Base Rate
Advance shall, for all other purposes, be considered part of such Borrowing,
and
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(ii) if the affected Eurodollar Advance or Advances are then outstanding,
Borrower shall immediately, or if permitted by applicable law, no later than
the date permitted thereby, upon at least one Business Day's written notice to
the Agent and the affected Lender, convert each such Advance into a Base Rate
Advance or Advances, provided that if more than one Lender is affected at any
time, then all affected Lenders must be treated the same pursuant to this
Section 3.09(b).
SECTION 3.10. INCREASED COSTS.
(a) If, after the date hereof, by reason of (x) the
introduction of or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in or in the interpretation
of any law or regulation, or (y) the compliance with any guideline or request
from any central bank or other governmental authority or quasi-governmental
authority exercising control over banks or financial institutions generally
(whether or not having the force of law):
(i) any Lender (or its applicable Lending Office) shall
be subject to any tax, duty or other charge with respect to its
Eurodollar Advances, its participation in Letters of Credit or its
obligation to make Eurodollar Advances or participate in Letters of
Credit, or the basis of taxation of payments to any Lender of the
principal of or interest on its Eurodollar Advances or its
participation in Letters of Credit or its obligation to make
Eurodollar Advances or participate in Letters of Credit shall have
changed (except for changes in the tax on the overall net income of
such Lender or its applicable Lending Office, or franchise taxes
applicable thereto, in each case, as imposed by the jurisdiction in
which such Lender's principal executive office or applicable Lending
Office is located); or
(ii) any reserve (including, without limitation, any
imposed by the Board of Governors of the Federal Reserve System),
special deposit or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any Lender's
applicable Lending Office shall be imposed or deemed applicable or any
other condition affecting its Eurodollar Advances or its participation
in Letters of Credit or its obligation to make Eurodollar Advances or
participate in Letters of Credit shall be imposed on any Lender or its
applicable Lending Office or the London interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining
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Eurodollar Advances (except to the extent already included in the determination
of the applicable Adjusted LIBO Rate for Eurodollar Advances) or its
participation in Letters of Credit or its obligation to make Eurodollar
Advances or participate in Letters of Credit, or there shall be a reduction in
the amount received or receivable by such Lender or its applicable Lending
Office, then Borrower shall from time to time (subject, in the case of certain
Taxes, to the applicable provisions of Section 3.07(b)), upon written notice
from and demand by such Lender on Borrower (with a copy of such notice and
demand to the Agent), pay to the Agent for the account of such Lender within
five Business Days after the date of such notice and demand, additional amounts
sufficient to indemnify such Lender against such increased cost. A certificate
as to the amount of such increased cost, submitted to Borrower and the Agent by
such Lender in good faith and accompanied by a statement prepared by such
Lender describing in reasonable detail the basis for and calculation of such
increased cost, shall constitute prima facie evidence of the matters contained
therein.
(b) If any Lender shall advise the Agent that at any
time, because of the circumstances described in clauses (x) or (y) in Section
3.10(a) or any other circumstances beyond such Lender's reasonable control
arising after the date of this Agreement affecting such Lender or the London
interbank market or such Lender's position in such market, the Adjusted LIBO
Rate as determined by the Agent will not adequately and fairly reflect the cost
to such Lender of funding its Eurodollar Advances, then, and in any such event:
(i) the Agent shall forthwith give notice (by telephone
confirmed in writing) to Borrower and to the other Lenders of such
advice;
(ii) Borrower's right to request from such Lender and such
Lender's obligation to make or permit portions of the Loans to remain
outstanding past the last day of the then current Interest Periods as
Eurodollar Advances shall be immediately suspended; and
(iii) such Lender shall make a Loan as part of the
requested Borrowing of Eurodollar Advances as a Base Rate Advance,
which such Base Rate Advance shall, for all other purposes, be
considered part of such Borrowing.
SECTION 3.11. LENDING OFFICES.
(a) Each Lender agrees that, if requested by Borrower, it
will use reasonable efforts (subject to overall policy considerations of such
Lender) to designate an alternate Lending Office with respect to any of its
Eurodollar Advances affected by
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the matters or circumstances described in Sections 3.07(b), 3.08, 3.09 or 3.10
to reduce the liability of Borrower or avoid the results provided thereunder,
so long as such designation is not disadvantageous to such Lender as reasonably
determined by such Lender, which determination shall be conclusive and binding
on all parties hereto. Nothing in this Section 3.11 shall affect or postpone
any of the obligations of Borrower or any right of any Lender provided
hereunder.
(b) If any Lender that is organized under the laws of any
jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) issues a public announcement with respect
to the closing of its lending offices in the United States such that any
withholdings or deductions and additional payments with respect to Taxes may be
required to be made by Borrower thereafter pursuant to Section 3.07(b), such
Lender shall use reasonable efforts to furnish Borrower notice thereof as soon
as practicable thereafter; provided, however, that no delay or failure to
furnish such notice shall in any event release or discharge Borrower from its
obligations to such Lender pursuant to Section 3.07(b) or otherwise result in
any liability of such Lender.
SECTION 3.12. FUNDING LOSSES. Borrower shall compensate each
Lender, upon its written request to Borrower (which request shall set forth the
basis for requesting such amounts in reasonable detail and which request shall
be made in good faith and shall constitute prima facie evidence of the matters
contained therein), for all losses, expenses and liabilities (including,
without limitation, any interest paid by such Lender to lenders of funds
borrowed by it to make or carry its Eurodollar Advances, in either case to the
extent not recovered by such Lender in connection with the re-employment of
such funds and including loss of anticipated profits), which the Lender may
sustain: (i) if for any reason (other than a default by such Lender) a
Borrowing of, or conversion to or continuation of, Eurodollar Advances to
Borrower does not occur on the date specified therefor in a Notice of Borrowing
or Notice of Conversion/Continuation (whether or not withdrawn), (ii) if any
repayment (excluding any mandatory prepayments pursuant to Section 2.04 but
including any conversions pursuant to Section 3.09(b)) of any Eurodollar
Advances to Borrower occurs on a date which is not the last day of an Interest
Period applicable thereto, or (iii), if, for any reason, Borrower defaults in
its obligation to repay its Eurodollar Advances when required by the terms of
this Agreement.
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SECTION 3.13. ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR
ADVANCES. Calculation of all amounts payable to a Lender under this Article
III shall be made as though that Lender had actually funded its relevant
Eurodollar Advances through the purchase of deposits in the relevant market
bearing interest at the rate applicable to such Eurodollar Advances in an
amount equal to the amount of the Eurodollar Advances and having a maturity
comparable to the relevant Interest Period and through the transfer of such
Eurodollar Advances from an offshore office of that Lender to a domestic office
of that Lender in the United States of America; provided, however, that each
Lender may fund each of its Eurodollar Advances in any manner it sees fit and
the foregoing assumption shall be used only for calculation of amounts payable
under this Article III.
SECTION 3.14. APPORTIONMENT OF PAYMENTS. Aggregate principal
and interest payments in respect of Loans and payments in respect of Letters of
Credit, letter of credit fees and commitment fees shall be apportioned among
all outstanding Commitments and Loans to which such payments relate,
proportionately to the Lenders' respective pro rata portions of such
Commitments and outstanding Loans. The Agent shall promptly distribute to each
Lender at its payment office specified by any Lender its share of all such
payments received by the Agent on the same Business Day as such payment is
deemed to be received by the Agent.
SECTION 3.15. SHARING OF PAYMENTS, ETC. If any Lender shall
obtain any payment or reduction (including, without limitation, any amounts
received as adequate protection of a deposit treated as cash collateral under
the Bankruptcy Code) of the Obligations (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) in excess of its
Pro Rata Share of payments or reductions on account of such obligations
obtained by all the Lenders, such Lender shall forthwith (i) notify each of the
other Lenders and Agent of such receipt, and (ii) purchase from the other
Lenders such participations in the affected obligations as shall be necessary
to cause such purchasing Lender to share the excess payment or reduction, net
of costs incurred in connection therewith, ratably with each of them, provided
that if all or any portion of such excess payment or reduction is thereafter
recovered from such purchasing Lender or additional costs are incurred, the
purchase shall be rescinded and the purchase price restored to the extent of
such recovery or such additional costs, but without interest unless the Lender
obligated to return such funds is required to pay interest on such funds.
Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 3.15 may, to the fullest extent permitted by
law, exercise all its rights of payment (including the right of set-off) with
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respect to such participation as fully as if such Lender were the direct
creditor of Borrower in the amount of such participation.
SECTION 3.16. CAPITAL ADEQUACY. Without limiting any other
provision of this Agreement, in the event that any Lender shall have determined
that any law, treaty, governmental (or quasi-governmental) rule, regulation,
guideline or order regarding capital adequacy not currently in effect or fully
applicable as of the Closing Date, or any change therein or in the
interpretation or application thereof after the Closing Date, or compliance by
such Lender with any request or directive regarding capital adequacy not
currently in effect or fully applicable as of the Closing Date (whether or not
having the force of law and whether or not failure to comply therewith would be
unlawful) from a central bank or governmental authority or body having
jurisdiction, does or shall have the effect of reducing the rate of return on
such Lender's capital as a consequence of its obligations hereunder to a level
below that which such Lender could have achieved but for such law, treaty,
rule, regulation, guideline or order, or such change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then within ten (10) Business Days
after written notice and demand by such Lender (with copies thereof to the
Agent), Borrower shall from time to time pay to such Lender additional amounts
sufficient to compensate such Lender for such reduction (but, in the case of
outstanding Base Rate Advances, without duplication of any amounts already
recovered by such Lender by reason of an adjustment in the applicable Base
Rate). Each certificate as to the amount payable under this Section 3.16
(which certificate shall set forth the basis for requesting such amounts in
reasonable detail), submitted to Borrower by any Lender in good faith, shall
constitute prima facie evidence of the matters contained therein.
SECTION 3.17. NOTICE OF CAPITAL ADEQUACY AND INCREASED COSTS
CLAIMS; LIMITATION ON PAYMENT OBLIGATIONS.
(a) Each Lender agrees to notify the Borrower as promptly as
practicable upon such Lender obtaining actual knowledge of any event occurring
after the Closing Date entitling such Lender to compensation pursuant to
Section 3.10 or Section 3.16 hereof; provided that, except as set forth in
subsection (b) below, the failure of any Lender to give such notice shall not
release the Borrower from any of its obligations pursuant to such Sections.
(b) In the event that any Lender fails to make written demand
for indemnification or compensation pursuant to Section 3.10 or Section 3.16
hereof within one year after the date that such Lender receives actual notice
or obtains actual knowledge of
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the promulgation of a law, rule, order or interpretation or occurrence of
another event giving rise to a claim pursuant to such Sections, the Borrower
shall not have any obligation to pay any amount with respect to claims accruing
prior to the date which is one year preceding such written demand.
ARTICLE IV.
CONDITIONS TO BORROWINGS AND LETTERS OF CREDIT
The obligations of each Lender to make Advances to Borrower
and the obligation of the Agent to issue Letters of Credit hereunder is subject
to the satisfaction of the following conditions:
SECTION 4.01. CONDITIONS PRECEDENT TO INITIAL LOANS AND
LETTERS OF CREDIT. At the time of the making of the initial Loans and issuance
of the initial Letters of Credit hereunder on the Closing Date, all obligations
of Borrower hereunder incurred prior to the initial Loans and Letters of Credit
(including, without limitation, Borrower's obligations to reimburse the
reasonable fees and expenses of counsel to the Agent and any fees and expenses
payable to the Agent or its Affiliates as previously agreed with Borrower,
including without limitation, the fees set forth in the Fee Letter), shall have
been paid in full, and the Agent shall have received the following, in form and
substance reasonably satisfactory in all respects to the Agent:
(a) the duly executed counterparts of this Agreement;
(b) the duly completed Revolving Credit Notes evidencing
the Revolving Credit Commitments;
(c) a duly executed Note Assignment and original
Intercompany Loan Documents, duly endorsed to the Agent, with respect
to each Intercompany Loan existing on the Closing Date;
(d) certificates of the Secretary or Assistant Secretary
of each of the Credit Parties attaching and certifying copies of the
resolutions of the boards of directors of the Credit Parties,
authorizing as applicable the execution, delivery and performance of
the Credit Documents;
(e) certificates of the Secretary or an Assistant
Secretary of each of the Credit Parties certifying (i) the name, title
and true signature of each officer of such entities executing the
Credit Documents, and (ii) the bylaws of such entities;
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(f) certified copies of the certificate or articles of
incorporation of each Credit Party certified by the Secretary of State
and by the Secretary or Assistant Secretary of such Credit Party,
together with certificates of good standing or existence, as may be
available from the Secretary of State of the jurisdiction of
incorporation or organization of such Credit Party and each other
jurisdiction where such Credit Party's ownership of property or the
conduct of its business require it to be qualified, except where a
failure to be so qualified would not have a Materially Adverse Effect;
(g) certificate of Borrower in substantially the form of
Exhibit D attached hereto and appropriately completed;
(h) the favorable opinion of ▇▇▇▇▇▇ & Bird, counsel to
the Credit Parties, in the form of Exhibit E, addressed to the Agent
and each of the Lenders;
(i) copies of all documents and instruments, including
all consents, authorizations and filings, required or advisable under
any Requirement of Law or by any material Contractual Obligation of
the Credit Parties, in connection with the execution, delivery,
performance, validity and enforceability of the Credit Documents and
the other documents to be executed and delivered hereunder, and such
consents, authorizations, filings and orders shall be in full force
and effect and all applicable waiting periods shall have expired;
(j) certificates, reports and other information as the
Agent may reasonably request from any Consolidated Company in order to
satisfy the Lenders as to the absence of any material liabilities or
obligations arising from matters relating to employees of the
Consolidated Companies, including employee relations, collective
bargaining agreements, Plans and other compensation and employee
benefit plans;
(k) certificates, reports, environmental audits and
investigations, and other information as the Agent may reasonably
request from any Consolidated Company in order to satisfy the Lenders
as to the absence of any material liabilities or obligations arising
from environmental and employee health and safety exposures to which
the Consolidated Companies may be subject, and the plans of the
Consolidated Companies with respect thereto;
(l) certificates, reports and other information as the
Agent may reasonably request from any Consolidated Company in order to
satisfy the Lenders as to the absence of any
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material liabilities or obligations arising from litigation (including
without limitation, products liability and patent infringement claims)
pending or threatened against the Consolidated Companies;
(m) evidence satisfactory to the Agent and the Lenders
that upon the funding of the initial Loans hereunder, the Existing
Indebtedness will be paid in full and terminated and that the holders
thereof will release all Liens securing the Existing Indebtedness;
(n) a summary, set forth in format and detail reasonably
acceptable to the Agent, of the types and amounts of insurance
(property and liability) maintained by the Consolidated Companies;
(o) evidence assuring the Agent and the Lenders that all
corporate proceedings and all other legal matters relating to the
Credit Parties in connection with the authorization, legality,
validity and enforceability of the Credit Documents are in form and
substance satisfactory to the Lenders;
(p) review of the subordination provisions in all
Subordinated Debt of the Borrower shall have been completed and such
provisions shall be in form and substance satisfactory to the Lenders;
and
(q) a certified copy of the Seller Note and the documents
governing the same and the documents governing the issuance of the
Buyer Note.
SECTION 4.02. CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT.
At the time of the making of all Loans and the issuance of each Letter of
Credit, including the initial Loans and initial Letter of Credit hereunder,
(before as well as after giving effect to such Loans and Letters of Credit and
to the proposed use of the proceeds thereof), the following conditions shall
have been satisfied or shall exist:
(a) there shall exist no Default or Event of Default;
(b) all representations and warranties by Borrower
contained herein 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 Loans or the issuance of such
Letter of Credit (except to the extent such representations and
warranties specifically relate to an earlier date);
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(c) since the date of the most recent financial
statements of the Consolidated Companies described in Section 5.14,
there shall have been no change which has had or could reasonably be
expected to have a Materially Adverse Effect (whether or not any
notice with respect to such change has been furnished to the Lenders
pursuant to Section 6.07);
(d) there shall be no action or proceeding instituted or
pending before any court or other governmental authority or, to the
knowledge of Borrower, threatened (i) which reasonably could be
expected to have a Materially Adverse Effect, or (ii) seeking to
prohibit or restrict one or more Credit Party's ownership or operation
of any portion of its business or assets, or to compel one or more
Credit Party to dispose of or hold separate all or any portion of its
businesses or assets, where such portion or portions of such
business(es) or assets, as the case may be, constitute a material
portion of the total businesses or assets of the Consolidated
Companies taken as a whole;
(e) the Loans to be made and the use of proceeds thereof
or the issuance of the requested Letter of Credit shall not
contravene, violate or conflict with, or involve the Agent or any
Lender in a violation of, any law, rule, injunction, or regulation, or
determination of any court of law or other governmental authority
applicable to Borrower; and
(f) the Agent shall have received such other documents or
legal opinions as the Agent or any Lender may reasonably request, all
in form and substance reasonably satisfactory to the Agent.
Each request for a Borrowing and the acceptance by Borrower of
the proceeds thereof and each request for the issuance of a Letter of Credit
shall constitute a representation and warranty by Borrower, as of the date of
the Loans comprising such Borrowing or the issuance of such Letter of Credit,
that the applicable conditions specified in Sections 4.01 and 4.02 have been
satisfied.
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ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Borrower (as to itself and all other Consolidated Companies)
represents and warrants as follows:
SECTION 5.01. CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Each
of the Consolidated Companies is a corporation duly organized, validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation, and each of the Credit Parties has the corporate power and
authority and the legal right to own and operate its property and to conduct
its business. Each of the Consolidated Companies (i) has the corporate power
and authority and the legal right to own and operate its property and to
conduct its business, (ii) is duly qualified as a foreign corporation and in
good standing under the laws of each jurisdiction where its ownership of
property or the conduct of its business requires such qualification, and (iii)
is in compliance with all Requirements of Law, where (a) the failure to have
such power, authority and legal right as set forth in clause (i), (b) the
failure to be so qualified or in good standing as set forth in clause (ii), or
(c) the failure to comply with Requirements of Law as set forth in clause
(iii), would reasonably be expected, in the aggregate, to have a Materially
Adverse Effect. The jurisdiction of incorporation or organization, and the
ownership of all issued and outstanding capital stock, for each Subsidiary as
of the date of this Agreement is accurately described on Schedule 5.01.
SECTION 5.02. CORPORATE POWER; AUTHORIZATION. Each of the
Credit Parties has the corporate power and authority to make, deliver and
perform the Credit Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of such
Credit Documents. No consent or authorization of, or filing with, any Person
(including, without limitation, any governmental authority), is required in
connection with the execution, delivery or performance by any Credit Party, or
the validity or enforceability against any Credit Party, of the Credit
Documents, other than such consents, authorizations or filings which have been
made or obtained.
SECTION 5.03. ENFORCEABLE OBLIGATIONS. This Agreement has
been duly executed and delivered, and each other Credit Document will be duly
executed and delivered, by the respective Credit Parties, and this Agreement
constitutes, and each other Credit Document when executed and delivered will
constitute, legal, valid and binding obligations of the Credit Parties,
respectively, enforceable against the Credit Parties in accordance with their
respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or
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similar laws affecting the enforcement of creditors' rights generally and by
general principles of equity.
SECTION 5.04. NO LEGAL BAR. The execution, delivery and
performance by the Credit Parties of the Credit Documents will not violate any
Requirement of Law or cause a breach or default under any of their respective
Contractual Obligations.
SECTION 5.05. NO MATERIAL LITIGATION. Except as set forth on
Schedule 5.05 or in any notice furnished to the Lenders pursuant to Section
6.07(e) at or prior to the respective times the representations and warranties
set forth in this Section 5.05 are made or deemed to be made hereunder, no
litigation, investigations or proceedings of or before any courts, tribunals,
arbitrators or governmental authorities are pending or, to the knowledge of
Borrower, threatened against any of the Consolidated Companies, or against any
of their respective properties or revenues, existing or future (a) with respect
to any Credit Document, or any of the transactions contemplated hereby or
thereby, or (b) which, if adversely determined, would reasonably be expected to
have a Materially Adverse Effect.
SECTION 5.06. INVESTMENT COMPANY ACT, ETC. None of the
Credit Parties is an "investment company" or a company "controlled" by an
"investment company" (as each of the quoted terms is defined or used in the
Investment Company Act of 1940, as amended). None of the Credit Parties is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, or any foreign, federal or local statute or regulation
limiting its ability to incur indebtedness for money borrowed, guarantee such
indebtedness, or pledge its assets to secure such indebtedness, all as
contemplated hereby or by any other Credit Document.
SECTION 5.07. MARGIN REGULATIONS. No part of the proceeds of
any of the Loans will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the applicable Margin
Regulations.
SECTION 5.08. COMPLIANCE WITH ENVIRONMENTAL LAWS.
(a) The Consolidated Companies have received no notices
of claims or potential liability under, and are in compliance with, all
applicable Environmental Laws, where such claims and liabilities under, and
failures to comply with, such statutes, regulations, rules, ordinances, laws or
licenses, would reasonably be expected to result in penalties, fines, claims or
other liabilities to the Consolidated Companies in amounts in excess of
$1,000,000, either individually or in the aggregate (including any such
penalties, fines, claims, or liabilities relating to the
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matters set forth on Schedule 5.08(a)), except as set forth on Schedule 5.08(a)
or in any notice furnished to the Lenders pursuant to Section 6.07(f) at or
prior to the respective times the representations and warranties set forth in
this Section 5.08(a) are made or deemed to be made hereunder.
(b) Except as set forth on Schedule 5.08(b) or in any
notice furnished to the Lenders pursuant to Section 6.07(f) at or prior to the
respective times the representations and warranties set forth in this Section
5.08(b) are made or deemed to be made hereunder, none of the Consolidated
Companies has received any notice of violation, or notice of any action, either
judicial or administrative, from any governmental authority (whether United
States or foreign) relating to the actual or alleged violation of any
Environmental Law, including, without limitation, any notice of any actual or
alleged spill, leak, or other release of any Hazardous Substance, waste or
hazardous waste by any Consolidated Company or its employees or agents, or as
to the existence of any contamination on any properties owned by any
Consolidated Company, where any such violation, spill, leak, release or
contamination would reasonably be expected to result in penalties, fines,
claims or other liabilities to the Consolidated Companies in amounts in excess
of $1,000,000, either individually or in the aggregate.
(c) Except as set forth on Schedule 5.08(c), the
Consolidated Companies have obtained all necessary governmental permits,
licenses and approvals which are material to the operations conducted on their
respective properties, including without limitation, all required material
permits, licenses and approvals for (i) the emission of air pollutants or
contaminants, (ii) the treatment or pretreatment and discharge of waste water
or storm water, (iii) the treatment, storage, disposal or generation of
hazardous wastes, (iv) the withdrawal and usage of ground water or surface
water, and (v) the disposal of solid wastes.
SECTION 5.09. INSURANCE. The Consolidated Companies
currently maintain insurance with respect to their respective properties and
businesses, with financially sound and reputable insurers, having coverages
against losses or damages of the kinds customarily insured against by reputable
companies in the same or similar businesses, such insurance being in amounts no
less than those amounts which are customary for such companies under similar
circumstances. The Consolidated Companies have paid all material amounts of
insurance premiums now due and owing with respect to such insurance policies
and coverages, and such policies and coverages are in full force and effect.
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SECTION 5.10. NO DEFAULT. None of the Consolidated Companies
is in default under or with respect to any Contractual Obligation in any
respect which has had or is reasonably expected to have a Materially Adverse
Effect.
SECTION 5.11. NO BURDENSOME RESTRICTIONS. Except as set
forth on Schedule 5.11 or in any notice furnished to the Lenders pursuant to
Section 6.07(k) at or prior to the respective times the representations and
warranties set forth in this Section 5.11 are made or deemed to be made
hereunder, none of the Consolidated Companies is a party to or bound by any
Contractual Obligation or Requirement of Law which has had or would reasonably
be expected to have a Materially Adverse Effect.
SECTION 5.12. TAXES. Except as set forth on Schedule 5.12,
each of the Consolidated Companies have filed or caused to be filed all
declarations, reports and tax returns which are required to have been filed,
and has paid all taxes, custom duties, levies, charges and similar
contributions ("taxes" in this Section 5.12) shown to be due and payable on
said returns or on any assessments made against it or its properties, and all
other taxes, fees or other charges imposed on it or any of its properties by
any governmental authority (other than those the amount or validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided in its
books); and no tax liens have been filed and, to the knowledge of Borrower, no
claims are being asserted with respect to any such taxes, fees or other
charges.
SECTION 5.13. SUBSIDIARIES. Except as disclosed on Schedule
5.01, on the date of this Agreement, Borrower has no Subsidiaries and neither
Borrower nor any Subsidiary is a joint venture partner or general partner in
any partnership. After the date of this Agreement, except as disclosed on
Schedule 5.01 or in any notice furnished pursuant to Section 6.07(l) at or
prior to the respective times the representations and warranties set forth in
this Section 5.13 are made or deemed to be made hereunder, Borrower has no
Subsidiaries.
SECTION 5.14. FINANCIAL STATEMENTS. Borrower has furnished
to the Agent and the Lenders (i) the audited consolidated and unaudited
consolidating balance sheets as of December 31, 1994, 1993 and 1992 of Borrower
and the related consolidated and consolidating statements of income and
shareholders' equity and consolidated statements of cash flows for the fiscal
years then ended, including in each case the related schedules and notes, (ii)
the unaudited balance sheet of Borrower
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presented on a consolidated basis as at the end of the second fiscal quarter of
1995, and the related unaudited consolidated statements of income and cash
flows presented on a consolidated basis for the year-to-date period then ended,
setting forth in each case in comparative form the figures for the
corresponding quarter of Borrower's previous fiscal year. The foregoing
financial statements fairly present in all material respects the consolidated
financial condition of Borrower as at the dates thereof and results of
operations for such periods in conformity with GAAP consistently applied
(subject, in the case of the quarterly financial statements, to normal year-end
audit adjustments and the absence of certain footnotes). The Consolidated
Companies taken as a whole do not have any material contingent obligations,
contingent liabilities, or material liabilities for known taxes, long-term
leases or unusual forward or long-term commitments not reflected in the
foregoing financial statements or the notes thereto. Since December 31, 1994,
there have been no changes with respect to the Consolidated Companies which has
had or would reasonably be expected to have a Materially Adverse Effect.
SECTION 5.15. ERISA. Except as disclosed on Schedule 5.15:
(1) Identification of Plans. None of the Consolidated
Companies nor any of their respective ERISA Affiliates maintains or contributes
to, or has during the past six years maintained or contributed to, any Plan
that is subject to Title IV of ERISA;
(2) Compliance. Each Plan maintained by the Consolidated
Companies has at all times been maintained, by its terms and in operation, in
compliance with all applicable laws, and the Consolidated Companies are subject
to no tax or penalty with respect to any Plan of such Consolidated Company or
any ERISA Affiliate thereof, including without limitation, any tax or penalty
under Title I or Title IV of ERISA or under Chapter 43 of the Tax Code, or any
tax or penalty resulting from a loss of deduction under Sections 162, 404, or
419 of the Tax Code, where the failure to comply with such laws, and such taxes
and penalties, together with all other liabilities referred to in this Section
5.15 (taken as a whole), would in the aggregate have a Materially Adverse
Effect;
(3) Liabilities. The Consolidated Companies are subject
to no liabilities (including withdrawal liabilities) with respect to any Plans
of such Consolidated Companies or any of their ERISA Affiliates, including
without limitation, any liabilities arising from Titles I or IV of ERISA, other
than obligations to fund benefits under an ongoing Plan and to pay current
contributions, expenses and premiums with respect to such
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Plans, where such liabilities, together with all other liabilities referred to
in this Section 5.15 (taken as a whole), would in the aggregate have a
Materially Adverse Effect;
(4) Funding. The Consolidated Companies and, with
respect to any Plan which is subject to Title IV of ERISA, each of their
respective ERISA Affiliates, have made full and timely payment of all amounts
(A) required to be contributed under the terms of each Plan and applicable law,
and (B) required to be paid as expenses (including PBGC or other premiums) of
each Plan, where the failure to pay such amounts (when taken as a whole,
including any penalties attributable to such amounts) would have a Materially
Adverse Effect. No Plan subject to Title IV of ERISA has an "amount of
unfunded benefit liabilities" (as defined in Section 4001(a)(18) of ERISA),
determined as if such Plan terminated on any date on which this representation
and warranty is deemed made, in any amount which, together with all other
liabilities referred to in this Section 5.15 (taken as a whole), would have a
Materially Adverse Effect if such amount were then due and payable. The
Consolidated Companies are subject to no liabilities with respect to post-
retirement medical benefits in any amounts which, together with all other
liabilities referred to in this Section 5.15 (taken as a whole), would have a
Materially Adverse Effect if such amounts were then due and payable.
SECTION 5.16. PATENTS, TRADEMARKS, LICENSES, ETC. Except as
set forth on Schedule 5.16, (i) the Consolidated Companies have obtained and
hold in full force and effect all material patents, trademarks, service marks,
trade names, copyrights, licenses and other such rights, free from burdensome
restrictions, which are necessary for the operation of their respective
businesses as presently conducted, and (ii) to the best of Borrower's
knowledge, no product, process, method, service or other item presently sold by
or employed by any Consolidated Company in connection with such business
infringes any patents, trademark, service ▇▇▇▇, trade name, copyright, license
or other right owned by any other person and there is not presently pending, or
to the knowledge of Borrower, threatened, any claim or litigation against or
affecting any Consolidated Company contesting such Person's right to sell or
use any such product, process, method, substance or other item where the result
of such failure to obtain and hold such benefits or such infringement would
have a Materially Adverse Effect.
SECTION 5.17. OWNERSHIP OF PROPERTY. Except as set forth on
Schedule 5.17, (i) each Consolidated Company has good and marketable fee simple
title to or a valid leasehold interest in all of its real property and good
title to, or a valid leasehold interest in, all of its other property, as such
properties are reflected in the consolidated balance sheet of the Consolidated
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Companies as of December 31, 1994 referred to in Section 5.14, other than
properties disposed of in the ordinary course of business since such date or as
otherwise permitted by the terms of this Agreement, subject to no Lien or title
defect of any kind, except Permitted Liens. The Consolidated Companies enjoy
peaceful and undisturbed possession under all of their respective leases.
SECTION 5.18. INDEBTEDNESS. Except for the Existing
Indebtedness to be repaid and terminated on the Closing Date set forth on
Schedule 5.18 and for the Indebtedness set forth on Schedule 7.01, none of the
Consolidated Companies is an obligor in respect of any Indebtedness for
borrowed money, or any commitment to create or incur any Indebtedness for
borrowed money, in an amount not less than $100,000 in any single case, and
such Indebtedness and commitments for amounts less than $100,000 do not exceed
$1,000,000 in the aggregate for all such Indebtedness and commitments of the
Consolidated Companies.
SECTION 5.19. FINANCIAL CONDITION. On the Closing Date and
after giving effect to the transactions contemplated by this Agreement and the
other Credit Documents, including without limitation, the use of the proceeds
of the Revolving Loans as provided in Section 2.01 (i) the assets of each
Credit Party at fair valuation and based on their present fair saleable value
(including, without limitation, the fair and realistic value of any rights in
respect of any Intercompany Loans held by such Credit Party) will exceed such
Credit Party's debts, including contingent liabilities, (ii) the remaining
capital of such Credit Party will not be unreasonably small to conduct the
Credit Party's business, and (iii) such Credit Party will not have incurred
debts, or have intended to incur debts, beyond the Credit Party's ability to
pay such debts as they mature. For purposes of this Section 5.19, "debt" means
any liability on a claim, and "claim" means (a) the right to payment, whether
or not such right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured, or (b) the right to an equitable remedy for breach of performance
if such breach gives rise to a right to payment, whether or not such right to
an equitable remedy is reduced to judgment, fixed, contingent, matured,
unmatured, disputed, undisputed, secured or unsecured.
SECTION 5.20. LABOR MATTERS. Except as set forth in Schedule
5.20 or in any notice furnished to the Lenders pursuant to Section 6.07(k) at
or prior to the respective times the representations and warranties set forth
in this Section 5.20 are made or deemed to be made hereunder, the Consolidated
Companies have experienced no strikes, labor disputes, slow downs or work
stoppages due to labor disagreements which have had, or would reasonably be
expected to have, a Materially Adverse Effect, and,
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to the best knowledge of Borrower, there are no such strikes, disputes, slow
downs or work stoppages threatened against any Consolidated Company. The hours
worked and payment made to employees of the Consolidated Companies have not
been in violation in any material respect of the Fair Labor Standards Act or
any other applicable law dealing with such matters. All payments due from the
Consolidated Companies, or for which any claim may be made against the
Consolidated Companies, on account of wages and employee health and welfare
insurance and other benefits have been paid or accrued as liabilities on the
books of the Consolidated Companies where the failure to pay or accrue such
liabilities would reasonably be expected to have a Materially Adverse Effect.
SECTION 5.21. PAYMENT OR DIVIDEND RESTRICTIONS. Except as
set forth in Section 7.04 or described on Schedule 5.21, none of the
Consolidated Companies is party to or subject to any agreement or understanding
restricting or limiting the payment of any dividends or other distributions by
any such Consolidated Company.
SECTION 5.22. INTERCOMPANY LOANS. The Intercompany Loans and
the Intercompany Loan Documents have been duly authorized and approved by all
necessary corporate and shareholder action on the part of the parties thereto,
and constitute the legal, valid and binding obligations of the parties thereto,
enforceable against each of them in accordance with their respective terms,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, or similar laws affecting creditors' rights generally, and by
general principles of equity.
SECTION 5.23. DISCLOSURE. No representation or warranty
contained in this Agreement (including the Schedules attached hereto) or in any
other document furnished from time to time pursuant to the terms of this
Agreement, contains or will contain any untrue statement of a material fact or
omits or will omit to state any material fact necessary to make the statements
herein or therein not misleading in any material respect as of the date made or
deemed to be made. Except as may be set forth herein (including the Schedules
attached hereto), there is no fact known to Borrower which has had, or is
reasonably expected to have, a Materially Adverse Effect.
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ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any
Note shall remain unpaid, Borrower will:
SECTION 6.01. CORPORATE EXISTENCE, ETC. Except as otherwise
permitted pursuant to Section 7.03, preserve and maintain, and cause each of
its Subsidiaries to preserve and maintain, its corporate existence, its
material rights, franchises, and licenses, and its material patents and
copyrights (for the scheduled duration thereof), trademarks, trade names, and
service marks, necessary or desirable in the normal conduct of its business,
and its qualification to do business as a foreign corporation in all
jurisdictions where it conducts business or other activities making such
qualification necessary, where the failure to be so qualified would reasonably
be expected to have a Materially Adverse Effect.
SECTION 6.02. COMPLIANCE WITH LAWS, ETC. Comply, and cause
each of its Subsidiaries to comply with all Requirements of Law (including,
without limitation, the Environmental Laws subject to the exception set forth
in Section 5.08 where the penalties, claims, fines, and other liabilities
resulting from noncompliance with such Environmental Laws do not involve
amounts in excess of $2,000,000 in the aggregate) and Contractual Obligations
applicable to or binding on any of them where the failure to comply with such
Requirements of Law and Contractual Obligations would reasonably be expected to
have a Materially Adverse Effect.
SECTION 6.03. PAYMENT OF TAXES AND CLAIMS, ETC. Pay, and
cause each of its Subsidiaries to pay, (i) all taxes, assessments and
governmental charges imposed upon it or upon its property, and (ii) all claims
(including, without limitation, claims for labor, materials, supplies or
services) which might, if unpaid, become a Lien upon its property, unless, in
each case, the validity or amount thereof is being contested in good faith by
appropriate proceedings and adequate reserves are maintained with respect
thereto.
SECTION 6.04. KEEPING OF BOOKS. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, containing complete
and accurate entries of all their respective financial and business
transactions.
SECTION 6.05. VISITATION, INSPECTION, ETC. Permit, and cause
each of its Subsidiaries to permit, any representative of the Agent or any
Lender, at the Agent's or such Lender's expense, to visit and inspect any of
its property, to examine its books and
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records and to make copies and take extracts therefrom, and to discuss its
affairs, finances and accounts with its officers, all at such reasonable times,
upon reasonable prior notice, and as often as the Agent or such Lender may
reasonably request; provided that, no notice shall be required in the event
that an Event of Default has occurred and is continuing.
SECTION 6.06. INSURANCE; MAINTENANCE OF PROPERTIES.
(a) Maintain or cause to be maintained with financially
sound and reputable insurers, insurance with respect to its properties and
business, and the properties and business of its Subsidiaries, against loss or
damage of the kinds customarily insured against by reputable companies in the
same or similar businesses, such insurance to be of such types and in such
amounts as is customary for such companies under similar circumstances.
(b) Cause, and cause each of the Consolidated Companies
to cause, all properties used or useful in the conduct of its business to be
maintained and kept in good condition, repair and working order (ordinary wear
and tear excepted) and supplied with all necessary equipment and will cause to
be made all necessary repairs, renewals, replacements, settlements and
improvements thereof, all as in the judgment of Borrower may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section shall prevent Borrower from discontinuing the operation or maintenance
of any such properties if such discontinuance is, in the judgment of Borrower,
desirable in the conduct of its business or the business of any Consolidated
Company.
SECTION 6.07. REPORTING COVENANTS. Furnish to each Lender:
(a) Annual Financial Statements. As soon as available
and in any event within 90 days after the end of each fiscal year of
Borrower, a balance sheet of the Consolidated Companies as at the end
of such year, presented on a consolidated and consolidating basis, and
the related statements of income, shareholders' equity, and cash flows
of the Consolidated Companies for such fiscal year, presented on a
consolidated and consolidating basis (other than statements of cash
flow), setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail and accompanied, as
to the consolidated statements, by a report thereon of Ernst & Young,
L.L.P. or other independent public accountants of comparable
recognized national standing, which such report shall be unqualified
as to going concern and scope of audit and otherwise
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satisfactory to the Lenders and shall state that such financial
statements present fairly in all material respects the financial
condition as at the end of such fiscal year on a consolidated basis,
and the results of operations and statements of cash flows of the
Consolidated Companies for such fiscal year in accordance with GAAP
and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with
generally accepted auditing standards;
(b) Quarterly Financial Statements. As soon as available
and in any event within 45 days after the end of each fiscal quarter
of Borrower (other than the fourth fiscal quarter), a balance sheet of
the Consolidated Companies as at the end of such quarter presented on
a consolidated basis and the related statements of income,
shareholders' equity (but only if such statement of shareholders'
equity is required to be prepared for such fiscal quarter under GAAP
or the accounting requirements of the Securities and Exchange
Commission, including, without limitation, Regulation S-X), and cash
flows of the Consolidated Companies for such fiscal quarter and for
the portion of Borrower's fiscal year ended at the end of such
quarter, presented on a consolidated basis setting forth in each case
in comparative form the figures for the corresponding quarter and the
corresponding portion of Borrower's previous fiscal year, all in
reasonable detail and certified by the chief financial officer or
principal accounting officer of Borrower that such financial
statements fairly present in all material respects the financial
condition of the Consolidated Companies as at the end of such fiscal
quarter on a consolidated basis, and the results of operations and
statements of cash flows of the Consolidated Companies for such fiscal
quarter and such portion of Borrower's fiscal year, in accordance with
GAAP consistently applied (subject to normal year-end audit
adjustments and the absence of certain footnotes);
(c) No Default/Compliance Certificate. Together with the
financial statements required pursuant to subsections (a) and (b)
above, a certificate of the treasurer or chief financial officer of
Borrower substantially in the form of Exhibit F attached hereto: (i)
to the effect that, based upon a review of the activities of the
Consolidated Companies and such financial statements during the
period covered thereby, there exists no Event of Default and no
Default under this Agreement, or if there exists an Event of Default
or a Default hereunder, specifying the nature thereof and the proposed
response thereto, (ii) demonstrating in reasonable detail compliance
as at the end of such fiscal year or such fiscal quarter with Section
6.08 and Sections 7.01 through
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7.05, (iii) certifying, with respect to the consolidating financial
statements required pursuant to subsection (a) above, that such
financial statements fairly present in all material respects the
financial condition of the relevant Consolidated Company as at the end
of such fiscal quarter on a consolidating basis, and the results of
operations of such Consolidated Company for such fiscal year, in
accordance with GAAP consistently applied, and (iv) indicating the
number of shares of Voting Stock of the Borrower owned by the Persons
comprising the ▇▇▇▇▇ Family;
(d) Notice of Default. Promptly after any Executive
Officer of Borrower has notice or knowledge of the occurrence of an
Event of Default or a Default, a certificate of the chief executive
officer, chief financial officer or principal accounting officer of
Borrower specifying the nature thereof and the proposed response
thereto;
(e) Litigation. Promptly after (i) the occurrence
thereof, notice of the institution of or any material adverse
development in any material action, suit or proceeding or any
governmental investigation or any arbitration, before any court or
arbitrator or any governmental or administrative body, agency or
official, against any Consolidated Company, or any material property
of any thereof, or (ii) an Executive Officer obtains actual knowledge
thereof, notice of the threat of any such action, suit, proceeding,
investigation or arbitration;
(f) Environmental Notices. Promptly after receipt
thereof, notice of any actual or alleged violation, or notice of any
action, claim or request for information, either judicial or
administrative, from any governmental authority relating to any actual
or alleged claim, notice of potential responsibility under or
violation of any Environmental Law, or any actual or alleged spill,
leak, disposal or other release of any waste, petroleum product, or
hazardous waste or Hazardous Substance by any Consolidated Company
which could reasonably be expected to result in penalties, fines,
claims or other liabilities to any Consolidated Company in amounts in
excess of $1,000,000;
(g) ERISA. (i) Promptly after the occurrence thereof
with respect to any Plan of any Consolidated Company or any ERISA
Affiliate thereof, or any trust established thereunder, notice of (A)
a "reportable event" described in Section 4043 of ERISA and the
regulations issued from time to time thereunder (other than a
"reportable event" not subject to the provisions for 30-day notice to
the PBGC under such regulations or for which penalties have been
waived under
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PBGC Technical Update 95-3), or (B) any other event which could
subject any Consolidated Company to any tax, penalty or liability
under Title I or Title IV of ERISA or Chapter 43 of the Tax Code, or
any tax or penalty resulting from a loss of deduction under Sections
162, 404 or 419 of the Tax Code, where any such taxes, penalties or
liabilities exceed or could exceed $250,000 in the aggregate;
(ii) Promptly after such notice must be provided
to the PBGC, or to a Plan participant, beneficiary or alternative
payee, any notice required under Section 101(d), 302(f)(4), 303, 307,
4041(b)(1)(A) or 4041(c)(1)(A) of ERISA or under Section 401(a)(29) or
412 of the Tax Code with respect to any Plan of any Consolidated
Company or any ERISA Affiliate thereof;
(iii) Promptly after receipt, any notice received
by any Consolidated Company or any ERISA Affiliate thereof concerning
the intent of the PBGC or any other governmental authority to
terminate a Plan of such Company or ERISA Affiliate thereof which is
subject to Title IV of ERISA, to impose any liability on such Company
or ERISA Affiliate under Title IV of ERISA or Chapter 43 of the Tax
Code;
(iv) Upon the request of the Agent, promptly upon
the filing thereof with the Internal Revenue Service ("IRS") or the
Department of Labor ("DOL"), a copy of IRS Form 5500 or annual report
for each Plan of any Consolidated Company or ERISA Affiliate thereof
which is subject to Title IV of ERISA;
(v) Upon the request of the Agent, (A) true and
complete copies of any and all documents, government reports and IRS
determination or opinion letters or rulings for any Plan of any
Consolidated Company from the IRS, PBGC or DOL, (B) any reports filed
with the IRS, PBGC or DOL with respect to a Plan of the Consolidated
Companies or any ERISA Affiliate thereof, or (C) a current statement
of withdrawal liability for each Multiemployer Plan of any
Consolidated Company or any ERISA Affiliate thereof;
(h) Liens. Promptly upon any Consolidated Company
becoming aware thereof, notice of the filing of any federal statutory
Lien, tax or other state or local government Lien or any other Lien
affecting their respective properties, other than Permitted Liens;
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(i) Public Filings, Etc. Promptly upon the filing
thereof or otherwise becoming available, copies of all financial
statements, annual, quarterly and special reports, proxy statements
and notices sent or made available generally by Borrower to its public
security holders, of all regular and periodic reports and all
registration statements (other than any registration statement on Form
S-8 (or its equivalent) filed under the Securities Act of 1933, as
amended) and prospectuses, if any, filed by any of them with any
securities exchange, and of all press releases and other statements
made available generally to the public containing material
developments in the business or financial condition of Borrower and
the other Consolidated Companies;
(j) Accountants' Reports. Promptly upon receipt thereof,
copies of all financial statements of, and all reports submitted by,
independent public accountants to Borrower in connection with each
annual, interim, or special audit of Borrower's financial statements,
including without limitation, the comment letter submitted by such
accountants to management in connection with their annual audit;
(k) Burdensome Restrictions, Etc. Promptly upon the
existence or occurrence thereof, notice of the existence or occurrence
of (i) any Contractual Obligation or Requirement of Law described in
Section 5.11, (ii) failure of any Consolidated Company to hold in full
force and effect those material trademarks, service marks, patents,
trade names, copyrights, licenses and similar rights necessary in the
normal conduct of its business, and (iii) any strike, labor dispute,
slow down or work stoppage as described in Section 5.20;
(l) Subsidiaries. Promptly upon the creation or
Acquisition of any new Subsidiary, notice of such event together with
a description of such Subsidiary and such transaction, relating
thereto;
(m) Asset Sale. Promptly upon the consummation of any
Asset Sale, notice of such event including the amount of Net Proceeds
received in connection therewith;
(n) Intercompany Loans. Together with the certificate
delivered pursuant to subsection (c) above, a list of the outstanding
Intercompany Loans as of the last day of the fiscal quarter for which
such certificate is delivered, indicating the outstanding balance on
each of the Intercompany Notes; and
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(o) Other Information. With reasonable promptness, such
other information about the Consolidated Companies as the Agent or any
Lender may reasonably request from time to time.
SECTION 6.08. FINANCIAL COVENANTS.
(a) Debt to Capital Ratio. Maintain a ratio of
Consolidated Funded Debt to Total Capitalization equal to or less than .6:1.0,
measured as of the last day of each fiscal quarter.
(b) Interest Coverage. Maintain an Interest Coverage
Ratio equal to or greater than 2.0:1.0, measured as of the last day of each
fiscal quarter for the immediately preceding four fiscal quarters ending on
such date.
(c) Consolidated Funded Debt to Cash Flow. Maintain a
ratio of (i) Consolidated Funded Debt to (ii) Consolidated EBITDA equal to or
less than 3.5:1.0, measured as of the last day of each fiscal quarter, and in
the case of Consolidated EBITDA, calculated for the immediately preceding four
fiscal quarters ending on such date.
(d) Second Fiscal Quarter 1995 Calculations. Schedule
6.08 sets forth the calculation of the financial covenant amounts, ratios, and
percentages required by paragraphs (a) through (c) of this Section 6.08
calculated as of June 30, 1995.
SECTION 6.09. NOTICES UNDER CERTAIN OTHER INDEBTEDNESS.
Immediately upon its receipt thereof, Borrower shall furnish the Agent a copy
of any notice received by it or any other Consolidated Company from the
holder(s) of Indebtedness referred to in ▇▇▇▇▇▇▇ ▇.▇▇(▇), (▇), (▇), (▇), (▇),
(▇), (▇) or (l) (or from any trustee, agent, attorney, or other party acting on
behalf of such holder(s)) in an amount which, in the aggregate, exceeds
$2,000,000, where such notice states or claims (i) the existence or occurrence
of any default or event of default with respect to such Indebtedness under the
terms of any indenture, loan or credit agreement, debenture, note, or other
document evidencing or governing such Indebtedness, or (ii) the existence or
occurrence of any event or condition which requires or permits holder(s) of any
Indebtedness to exercise rights under any Change in Control Provision.
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ARTICLE VII.
NEGATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any
Note shall remain unpaid, Borrower will not and will not permit any Subsidiary
to:
SECTION 7.01. INDEBTEDNESS. Create, incur, assume,
guarantee, suffer to exist or otherwise become liable on or with respect to,
directly or indirectly, any Indebtedness, other than:
(a) Indebtedness of the Borrower under this Agreement;
(b) Indebtedness outstanding on the Closing Date (other
than the Existing Indebtedness to be repaid on the Closing Date) and
described on Schedule 7.01, including the line of credit extended by
SunTrust in aggregate principal amount not to exceed $5,000,000 and
the letter of credit facility for trade letters of credit extended by
SunTrust in an aggregate face amount not to exceed $1,000,000;
(c) The Seller Note and any stand-by letter of credit
facility established by the Borrower solely for support thereof (which
letter of credit and accompanying documentation has been approved in
writing by the Required Lenders);
(d) Indebtedness not otherwise permitted by this Section
7.01; provided however, that the aggregate principal amount of the
Indebtedness permitted by this paragraph (d) at any one time
outstanding may not exceed $5,000,000;
(e) unsecured current liabilities (other than liabilities
for borrowed money or liabilities evidenced by promissory notes, bonds
or similar instruments) incurred in the ordinary course of business
and not more than 30 days past due;
(f) Subordinated Debt of the Borrower which is unsecured
and approved as to terms and conditions by the Required Lenders;
(g) Guarantees approved in writing by the Required
Lenders;
(h) Endorsements of instruments for deposit or collection
in the ordinary course of business;
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(i) Indebtedness of a Person which is acquired by or
consolidated with a Consolidated Company as long as such Indebtedness
is not obtained in contemplation of such acquisition; provided that,
such Indebtedness relates either to a tax exempt financing arrangement
of such Person or Capital Lease Obligations (excluding Capital Lease
Obligations under tax exempt financing arrangements already included
as Indebtedness for purposes of determining compliance with this
subsection (i)) which do not violate subsection (d) above and provided
further, that such Indebtedness does not exceed $10,000,000 in
aggregate amount with respect to any single Acquisition or related
series of Acquisitions and does not exceed $20,000,000 in aggregate
amount during the term of this Agreement;
(j) Indebtedness arising from the Acquisition of Basic
American Corporation, whether in connection with new credit facilities
provided by SunTrust or any other Person, existing Indebtedness of
Basic American Corporation outstanding on the date of the Acquisition
after giving effect thereto, or Indebtedness in the form of notes or
other obligations created by a Consolidated Company in favor of the
seller of Basic American Corporation in connection with the
Acquistion; provided, however, that the aggregate principal amount of
such Indebtedness at any time outstanding shall not exceed $5,000,000;
(k) Intercompany Loans among the Borrower and its
Subsidiaries; provided that, the obligations of each obligor of such
Indebtedness shall (i) be evidenced by an Intercompany Note which is
pledged to the Agent for the benefit of the Lenders pursuant to a Note
Assignment; (ii) be subordinated in right of payment to the
Obligations on terms and conditions satisfactory to the Required
Lenders, in the case of Intercompany Loans made to the Borrower, and
(iii) be payable on demand, in the case of Intercompany Loans made by
the Borrower; and
(l) Indebtedness incurred in connection with the refinancing,
extension or renewal of Indebtedness described in subparagraphs (b),
(d) and (i) above so long as such Indebtedness is extended on terms at
least as favorable, and in a principal amount no greater than, the
Indebtedness refinanced or renewed or extended.
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SECTION 7.02. LIENS. Create, incur, assume or suffer to
exist any Lien on any of its property now owned or hereafter acquired to secure
any Indebtedness other than:
(a) Liens existing on the Closing Date and disclosed on
Schedule 7.02 and Liens granted on or after the Closing Date to the
Agent for the benefit of the Lenders;
(b) any Lien securing Indebtedness permitted by Section
7.01(d);
(c) Liens for taxes not yet due, and Liens for taxes or
Liens imposed by ERISA which are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves
are being maintained in accordance with GAAP;
(d) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law
and created in the ordinary course of business for amounts not yet due
or which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves are being maintained in
accordance with GAAP;
(e) Liens 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 and
appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(f) zoning, easements and restrictions on the use of real
property which do not materially impair the use of such property;
(g) rights in property reserved or vested in any
governmental authority which do not materially impair the use of such
property; and
(h) Liens securing tax exempt financings permitted by
Section 7.01(i) and the Indebtedness permitted by Section 7.01(j).
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SECTION 7.03. MERGERS, ASSET SALES, ETC.
(a) Merge or consolidate with any other Person, except that this Section 7.03
shall not apply to (i) any merger or consolidation of Borrower with any other
Person provided that the Borrower is the surviving corporation after such
merger or consolidation, (ii) any merger or consolidation of any of the
Borrower's Subsidiaries with any other Person provided that the surviving
corporation of such merger or consolidation, after giving effect thereto, shall
be a wholly-owned Subsidiary of the Borrower or (iii) any merger of a
Subsidiary of the Borrower into the Borrower or another wholly-owned Subsidiary
of the Borrower;
(b) Enter into any Asset Sale or lease of any of its accounts,
property or other assets (including capital stock of any Subsidiary of
Borrower), except that this Section 7.03 shall not apply to (i) any Asset Sale
or lease of assets of any Subsidiary of the Borrower to the Borrower or any of
its other Subsidiaries, (ii) other Asset Sales as long as the Net Proceeds
thereof are applied as set forth in Section 2.04 hereof, and (iii) the sale of
American Southern Insurance Company; provided, however, that no transaction
pursuant to subsection 7.03(a) or subsections 7.03(b)(i) and (ii) above shall
be permitted if any Default or Event of Default exists at the time of such
transaction or would exist as a result of such transaction.
SECTION 7.04. DIVIDENDS, ETC. Borrower shall not declare or
pay any dividend on its capital stock, and neither Borrower nor any of its
Subsidiaries shall make any payment to purchase, redeem, retire or acquire any
of its Subordinated Debt or capital stock or any option, warrant, or other
right to acquire such Subordinated Debt or capital stock, other than:
(i) dividends payable solely in shares of capital stock;
(ii) dividends payable to the Borrower by its Subsidiaries;
(iii) mandatory sinking fund payments, other required
prepayment or mandatory installment or final payment at maturity
required by the terms of any Subordinated Debt; and
(iv) purchases by Borrower of its capital stock for total
consideration not to exceed $1,000,000 in any fiscal year of the
Borrower;
provided, however, no such dividend or other payment may be declared or paid
pursuant to this Section 7.04 unless no Default or Event of Default exists at
the time of such declaration or
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payment, or would exist as a result of such declaration or payment.
SECTION 7.05. INVESTMENTS, LOANS, ACQUISITIONS ETC. (i) Make
or enter into any Acquisition, (ii) make, permit or hold any Investments, or
(iii) otherwise acquire or hold any Subsidiaries, other than:
(a) Investments in Subsidiaries of Borrower existing as
of the Closing Date;
(b) Investments in Cash Equivalents;
(c) Investments in other instruments which have received
and continue to be rated as Investment Grade;
(d) Investments received in settlement of Indebtedness
created in the ordinary course of business or Investments in the form
of loans to employees in the ordinary course of business;
(e) Intercompany Loans to the extent permitted by Section
7.01;
(f) Acquisitions, provided that:
(x) before and after giving effect to such
Acquisition, no Default or Event of Default shall exist
hereunder, as certified by Borrower to the Lenders in writing,
together with evidence of the calculation of the financial
covenants hereunder, as of the closing date of such
Acquisition;
(y) such Acquisition shall have been approved in
advance by a majority of the board of directors of the seller;
and
(z) in the case of any Acquisition where the total
consideration to be paid by the Borrower exceeds $5,000,000,
the Lenders shall have been given reasonable notice of the
proposed Acquisition, access to the due diligence information
collected or prepared by the Borrower in connection with the
Acquisition, and a reasonable opportunity to review such
information and question the management of the Borrower
regarding such information;
(g) Investments of American Southern Insurance Company
permitted by applicable law;
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(h) the Buyer Note; and
(i) Other Investments not permitted by the preceding
paragraphs to the extent reflected on the balance sheet of the
Consolidated Companies as of the Closing Date and set forth on
Schedule 7.05 attached hereto.
SECTION 7.06 SALE AND LEASEBACK TRANSACTIONS. Sell or
transfer any property, real or personal, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property which
any Consolidated Company intends to use for substantially the same purpose or
purposes as the property being sold or transferred.
SECTION 7.07. TRANSACTIONS WITH AFFILIATES. Enter into any
transaction or series of related transactions which in the aggregate would be
material, whether or not in the ordinary course of business, with any Affiliate
of any Consolidated Company (but excluding any Affiliate which is also a
wholly-owned Subsidiary of Borrower and any compensation arrangement with an
officer or director of the Borrower or any other Consolidated Company entered
into in the ordinary course of business), other than on terms and conditions
substantially as favorable to such Consolidated Company as would be obtained by
such Consolidated Company at the time in a comparable arm's-length transaction
with a Person other than an Affiliate.
SECTION 7.08. ISSUANCE OF CAPITAL STOCK. Allow any
Subsidiary of Borrower to issue any shares, interests, warrants, participations
or other equivalent instruments to any Person other than the Borrower.
SECTION 7.09. ERISA. Without first obtaining the written
approval of the Required Lenders, take or fail to take any action which might
reasonably be expected to have a Materially Adverse Effect with respect to any
Plan of any Consolidated Company or, with respect to its ERISA Affiliates, any
Plans which are subject to Title IV of ERISA or to continuation health care
requirements for group health plans under the Tax Code, including without
limitation (i) establishing any such Plan, (ii) amending any such Plan (except
where required to comply with applicable law), (iii) terminating or withdrawing
from any such Plan, or (iv) incurring an amount of unfunded benefit
liabilities, as defined in Section 4001(a)(18) of ERISA, or any withdrawal
liability under Title IV of ERISA with respect to any such Plan.
SECTION 7.10. LIMITATION ON PAYMENT RESTRICTIONS AFFECTING
CONSOLIDATED COMPANIES. Create or otherwise cause or suffer to exist or become
effective, any consensual encumbrance or restriction on the ability of any
Consolidated Company to (i) pay
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dividends or make any other distributions on any stock of a Subsidiary of the
Borrower, or (ii) pay any Indebtedness owed to Borrower or any other
Consolidated Company, or (iii) transfer any of its property or assets to
Borrower or any other Consolidated Company, except any consensual encumbrance
or restriction existing as of the Closing Date.
SECTION 7.11. ACTIONS UNDER CERTAIN DOCUMENTS. Without the
prior written consent of the Required Lenders (i) modify, amend, cancel or
rescind the provisions of any agreements or documents evidencing or governing
(x) Subordinated Debt, or (y) the maturity date, principal amount, interest
rate, amortization schedule or offset rights with respect to either the Seller
Note or the Buyer Note or (ii) make any payment with respect to Subordinated
Debt except payments expressly permitted by the terms of such Subordinated
Debt.
SECTION 7.12. CHANGES IN FISCAL YEAR. Change its fiscal year
from that in effect as of the Closing Date.
ARTICLE VIII.
EVENTS OF DEFAULT
Upon the occurrence and during the continuance of any of the
following specified events (each an "Event of Default"):
SECTION 8.01. PAYMENTS. Borrower shall fail to make promptly
when due (including, without limitation, by mandatory prepayment) any principal
payment with respect to the Loans, or Borrower shall fail to make any payment
of interest, fee or other amount payable hereunder within five (5) days of the
due date thereof;
SECTION 8.02. COVENANTS WITHOUT NOTICE. Borrower shall fail
to observe or perform any covenant or agreement contained in (i) Sections 6.01,
6.05, 6.07 or 6.09 and such failure shall remain unremedied for five (5) days
after the earlier of (x) any Executive Officer of the Borrower obtaining
knowledge thereof or (y) written notice thereof shall have been given to
Borrower by Agent or any Lender or (ii) Section 6.08 or Article VII;
SECTION 8.03. OTHER COVENANTS. Borrower shall fail to
observe or perform any covenant or agreement contained in this Agreement, other
than those referred to in Sections 8.01 and 8.02, and, if capable of being
remedied, such failure shall remain unremedied for 30 days after the earlier of
(i) any Executive Officer of the Borrower obtaining knowledge thereof, or (ii)
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written notice thereof shall have been given to Borrower by Agent or any
Lender;
SECTION 8.04. REPRESENTATIONS. Any representation or
warranty made or deemed to be made by Borrower or any other Credit Party or by
any of its officers under this Agreement or any other Credit Document
(including the Schedules attached thereto), or any certificate or other
document submitted to the Agent or the Lenders by any such Person pursuant to
the terms of this Agreement or any other Credit Document, shall be incorrect in
any material respect when made or deemed to be made or submitted;
SECTION 8.05. NON-PAYMENTS OF OTHER INDEBTEDNESS. Any
Consolidated Company shall fail to make when due (whether at stated maturity,
by acceleration, on demand or otherwise, and after giving effect to any
applicable grace period) any payment of principal of or interest on any
Indebtedness (other than the Obligations) exceeding $2,000,002 individually or
in the aggregate;
SECTION 8.06. DEFAULTS UNDER OTHER AGREEMENTS; CHANGE IN
CONTROL PROVISIONS. Any Consolidated Company shall fail to observe or perform
any covenants or agreements contained in any agreements or instruments relating
to any of its Indebtedness exceeding $2,000,002 individually or in the
aggregate, or any other event shall occur if the effect of such failure or
other event is to accelerate, or to permit the holder of such Indebtedness or
any other Person to accelerate, the maturity of such Indebtedness; or any such
Indebtedness shall be required to be prepaid (other than by a regularly
scheduled required prepayment) in whole or in part prior to its stated
maturity; or any event or condition shall occur or exist which, pursuant to the
terms of any Change in Control Provision, requires or permits the holder(s) of
the Indebtedness subject to such Change in Control Provision to require that
such Indebtedness exceeding $2,000,002 individually or in the aggregate, be
redeemed, repurchased, defeased, prepaid or repaid, in whole or in part, or the
maturity of such Indebtedness to be accelerated, unless such failure or the
effect of such Change in Control Provision is waived in writing by the holders
of such Indebtedness;
SECTION 8.07. BANKRUPTCY. Borrower or any other Consolidated
Company shall commence a voluntary case concerning itself under the Bankruptcy
Code or applicable foreign bankruptcy laws; or an involuntary case for
bankruptcy is commenced against any Consolidated Company and the petition is
not controverted within 20 days, or is not dismissed within 60 days, after
commencement of the case; or a custodian (as defined in the Bankruptcy Code) or
similar official under applicable foreign bankruptcy laws is appointed for, or
takes charge of, all or any
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substantial part of the property of any Consolidated Company; or any
Consolidated Company commences proceedings of its own bankruptcy or to be
granted a suspension of payments or 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 any Consolidated Company or
there is commenced against any Consolidated Company any such proceeding which
remains undismissed for a period of 60 days; or any Consolidated Company is
adjudicated insolvent or bankrupt; or any order of relief or other order
approving any such case or proceeding is entered; or any Consolidated Company
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 any Consolidated Company makes a general assignment for the benefit of
creditors; or any Consolidated Company shall fail to pay, or shall state in
writing that it is unable to pay, or shall be unable to pay, its debts
generally as they become due; or any Consolidated Company shall call a meeting
of its creditors with a view to arranging a composition or adjustment of its
debts; or any Consolidated Company shall by any act or failure to act indicate
its consent to, approval of or acquiescence in any of the foregoing; or any
corporate action is taken by any Consolidated Company for the purpose of
effecting any of the foregoing;
SECTION 8.08. ERISA. A Plan of a Consolidated Company or a
Plan subject to Title IV of ERISA of any of its ERISA Affiliates
(i) shall fail to be funded in accordance with the
minimum funding standard required by applicable law,
the terms of such Plan, Section 412 of the Tax Code
or Section 302 of ERISA for any plan year or a waiver
of such standard is sought or granted with respect to
such Plan under applicable law, the terms of such
Plan or Section 412 of the Tax Code or Section 303 of
ERISA; or
(ii) is being, or has been, terminated or the subject of
termination proceedings under applicable law or the
terms of such Plan; or
(iii) shall require a Consolidated Company to provide
security under applicable law, the terms of such
Plan, Section 401 or 412 of the Tax Code or Section
306 or 307 of ERISA; or
(iv) results in a liability to a Consolidated Company
under applicable law, the terms of such Plan, or
Title IV of ERISA;
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and there shall result from any such failure, waiver, termination or other
event a liability to the PBGC or a Plan that would have a Materially Adverse
Effect;
SECTION 8.09. MONEY JUDGMENT. Judgments or orders for the
payment of money in excess of $2,000,000 individually or in the aggregate
(unless the Borrower's insurers have affirmatively agreed in writing that such
amounts are covered by insurance) or otherwise having a Materially Adverse
Effect shall be rendered against Borrower or any other Consolidated Company and
such judgment or order shall continue unsatisfied (in the case of a money
judgment) and in effect for a period of 60 days during which execution shall
not be effectively stayed or deferred (whether by action of a court, by
agreement or otherwise);
SECTION 8.10. OWNERSHIP OF SUBSIDIARIES. If Borrower shall
at any time fail to own and control the shares of Voting Stock of any
Subsidiary which it owned or controlled as of the Closing Date or such later
date when such Subsidiary was created or acquired, except in connection with an
Asset Sale or a merger or consolidation permitted hereunder;
SECTION 8.11. CHANGE IN CONTROL OF BORROWER. If any of the
following shall occur:
(a) any individual, entity, or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended), other than the ▇▇▇▇▇ Family, shall acquire the stock of the Borrower
resulting in beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the such Act) of more than 30% of the combined voting power of the then
outstanding Voting Stock of the Borrower entitled to vote for the election of a
majority of the members of the board of directors of the Borrower; or
(b) the Persons comprising the ▇▇▇▇▇ Family shall cease to
own, in the aggregate, at least 720,000 shares of the outstanding Voting Stock
of the Borrower (without regard to any dilution thereof); or
(c) a change in the board of directors of the Borrower shall
occur such that, as of any date, a majority of the Board of Directors of the
Borrower consists of individuals who were not either (i) directors of the
Borrower as of the corresponding date of the previous year, (ii) selected or
nominated to be selected to become directors by the Board of Directors of the
Borrower of which a majority consisted of individuals described in clause (i),
or (iii) selected or nominated to be selected to become directors by the Board
of Directors of the Borrower of which a majority
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consisted of individuals described in clause (i) and individuals described in
clause (ii);
SECTION 8.12. DEFAULT UNDER OTHER CREDIT DOCUMENTS. There
shall exist or occur any "Event of Default" as provided under the terms of any
other Credit Document, or any Credit Document ceases to be in full force and
effect or the validity or enforceability thereof is disaffirmed by or on behalf
of Borrower or any other Credit Party, or at any time it is or becomes unlawful
for Borrower or any other Credit Party to perform or comply with its
obligations under any Credit Document, or the obligations of Borrower or any
other Credit Party under any Credit Document are not or cease to be legal,
valid and binding on Borrower or any such Credit Party;
then, and in any such event, and at any time thereafter if any Event of Default
shall then be continuing, the Agent may, and upon the written or telex request
of the Required Lenders, shall, by written notice to Borrower, take any or all
of the following actions, without prejudice to the rights of the Agent, any
Lender or the holder of any Note to enforce its claims against Borrower or any
other Credit Party: (i) declare all Commitments terminated, whereupon the
Commitments of each Lender shall terminate immediately and any commitment fee
shall forthwith become due and payable without any other notice of any kind;
(ii) declare the principal of and any accrued interest on the Loans, and all
other Obligations owing hereunder, including, without limitation, an amount
equal to the maximum amount available to be drawn under all outstanding Letters
of Credit (whether or not the beneficiary thereunder shall have presented, or
shall be entitled at such time to present, the drafts or other documents
required to draw under such Letters of Credit) 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; provided,
that, if an Event of Default specified in Section 8.07 shall occur, the result
which would occur upon the giving of written notice by the Agent to any Credit
Party, as specified in clauses (i) and (ii) above, shall occur automatically
without the giving of any such notice, and (iii) may exercise any other rights
or remedies available under the Credit Documents, at law or in equity. As long
as any Letters of Credit remain outstanding, any amounts described in clause
(ii) above with respect to Letters of Credit, when received by the Agent, shall
be deposited in a cash collateral account as cash collateral for the obligation
of the Borrower under Article II of this Agreement in the event of any drawing
under a Letter of Credit, and upon drawing under any outstanding Letter of
Credit in respect of which the Agent has deposited in the cash collateral
account any amounts described in clause (ii) above, the Agent
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shall pay such amounts to itself to reimburse itself for the amount of such
drawing as provided in Section 2.07 hereof.
ARTICLE IX.
THE AGENT
SECTION 9.01. APPOINTMENT OF AGENT. Each Lender hereby
designates SunTrust as Agent to administer all matters concerning the Loans and
to act as herein specified. Each Lender hereby irrevocably authorizes, and
each holder of any Note by the acceptance of a Note shall be deemed irrevocably
to authorize, the Agent to take such actions on its behalf under the provisions
of this Agreement, the other Credit Documents, and all 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 Agent by the terms hereof and thereof and such other powers
as are reasonably incidental thereto. The Agent may perform any of its duties
hereunder by or through their agents or employees.
SECTION 9.02. AUTHORIZATION OF AGENT WITH RESPECT TO THE
SECURITY DOCUMENTS. (a) Each Lender hereby authorizes the Agent to enter into
each of the Security Documents substantially in the form attached hereto, and
to take all action contemplated thereby. All rights and remedies under the
Security Documents may be exercised by the Agent for the benefit of the Agent
and the Lenders and the other beneficiaries thereof upon the terms thereof.
The Lenders further agree that the Agent may assign its rights and obligations
under any of the Security Documents to any affiliate of the Agent or to any
trustee, if necessary or appropriate under applicable law, which assignee in
each such case shall (subject to compliance with any requirements of applicable
law governing the assignment of such Security Documents) be entitled to all the
rights of the Agent under and with respect to the applicable Security Document.
(b) In each circumstance where, under any provision of
any Security Document, the Agent shall have the right to grant or withhold any
consent, exercise any remedy, make any determination or direct any action by
the Agent under such Security Document, the Agent shall act in respect of such
consent, exercise of remedies, determination or action, as the case may be,
with the consent of and at the direction of the Required Lenders; provided,
however, that no such consent of the Required Lenders shall be required with
respect to any consent, determination or other matter that is, in the Agent's
judgment, ministerial or administrative in nature. In each circumstance where
any consent of or direction from the Required Lenders is required, the Agent
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shall send to the Lenders a notice setting forth a description in reasonable
detail of the matter as to which consent or direction is requested and the
Agent's proposed course of action with respect thereto.
SECTION 9.03. NATURE OF DUTIES OF AGENT. The Agent shall
have no duties or responsibilities except those expressly set forth in this
Agreement and the other Credit Documents. None of the Agent nor any of its
respective officers, directors, employees or agents shall be liable for any
action taken or omitted by it as such hereunder or in connection herewith,
unless caused by its or their gross negligence or willful misconduct. The
duties of the Agent shall be ministerial and administrative in nature; the
Agent shall not have by reason of this Agreement a fiduciary relationship in
respect of any Lender; and nothing in this Agreement, express or implied, is
intended to or shall be so construed as to impose upon the Agent any
obligations in respect of this Agreement or the other Credit Documents except
as expressly set forth herein. In carrying out its duties as expressly set
forth in this Agreement and the other Credit Documents, the Agent shall act in
a manner customary to its administration of credit facilities of a similar size
and nature provided to borrowers of similar standing for its own account.
SECTION 9.04. LACK OF RELIANCE ON THE AGENT.
(a) Independently and without reliance upon the Agent,
each Lender, 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 Credit Parties in connection with the taking or not taking of
any action in connection herewith, and (ii) its own appraisal of the
creditworthiness of the Credit Parties, and, except as expressly provided in
this Agreement, the Agent shall have no duty or responsibility, either
initially or on a continuing basis, to provide any Lender 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.
(b) The Agent shall not be responsible to any Lender 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,
collectibility, priority or sufficiency of this Agreement, the Notes, the Note
Assignment or any other documents contemplated hereby or thereby, or the
financial condition of the Credit Parties, or be required to make any inquiry
concerning either the performance or observance of any of the terms, provisions
or conditions of this Agreement, the Notes, the Note Assignment or the
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other documents contemplated hereby or thereby, or the financial condition of
the Credit Parties, or the existence or possible existence of any Default or
Event of Default.
SECTION 9.05. CERTAIN RIGHTS OF THE AGENT. If the Agent
shall request instructions from the Required Lenders with respect to any action
or actions (including the failure to act) in connection with this Agreement,
the Agent shall be entitled to refrain from such act or taking such act, unless
and until the Agent shall have received instructions from the Required Lenders;
and the Agent shall not incur liability in any Person by reason of so
refraining. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders.
SECTION 9.06. RELIANCE BY AGENT. The 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, cable gram, radiogram, order or other documentary, teletransmission or
telephone message believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person. The Agent may consult with legal
counsel (including counsel for any Credit Party), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 9.07. INDEMNIFICATION OF AGENT. To the extent the
Agent is not reimbursed and indemnified by the Credit Parties, each Lender will
reimburse and indemnify the Agent, ratably according to the respective amounts
of the Loans outstanding under all Facilities (or if no amounts are
outstanding, ratably in accordance with the Total Commitments), in either case,
for and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including counsel fees
and disbursements) or disbursements of any kind or nature whatsoever which may
be imposed on, incurred by or asserted against the Agent in performing its
duties hereunder, in any way relating to or arising out of this Agreement or
the other Credit Documents; provided that no Lender shall be liable to the
Agent for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Agent's gross negligence or willful misconduct.
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SECTION 9.08. THE AGENT IN ITS INDIVIDUAL CAPACITY. With
respect to its obligation to lend under this Agreement, the Loans made by it
and the Notes issued to it, the Agent shall have the same rights and powers
hereunder as any other Lender or holder of a Note and may exercise the same as
though it were not performing the duties specified herein; and the terms
"Lenders", "Required Lenders", "holders of Notes", or any similar terms shall,
unless the context clearly otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of banking, trust, financial advisory or other
business with the Consolidated Companies or any affiliate of the Consolidated
Companies as if it were not performing the duties specified herein, and may
accept fees and other consideration from the Consolidated Companies for
services in connection with this Agreement and otherwise without having to
account for the same to the Lenders.
SECTION 9.09. HOLDERS OF NOTES. The Agent may deem and treat
the payee of any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof shall have been
filed with the Agent. 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 or assignee of such Note or of any Note or Notes issued in exchange
therefor.
SECTION 9.10. SUCCESSOR AGENT.
(a) The Agent may resign at any time by giving written
notice thereof to the Lenders and Borrower and may be removed at any time with
or without cause by the Required Lenders; provided, however, the Agent may not
resign or be removed until a successor Agent has been appointed and shall have
accepted such appointment. Upon any such resignation or removal, the Required
Lenders shall have the right to appoint a successor Agent subject to Borrower's
prior written approval. If no successor Agent shall have been so appointed by
the Required Lenders, and shall have accepted such appointment, within 30 days
after the retiring Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Agent, then the retiring Agent may, on behalf
of the Lenders, appoint a successor Agent subject to Borrower's prior written
approval, which shall be a bank which maintains an office in the United States,
or a commercial bank organized under the laws of the United States of America
or any State thereof, or any Affiliate of such bank, having a combined capital
and surplus of at least $100,000,000. In the event that the Agent is no longer
a Lender hereunder, the Agent shall promptly resign as Agent.
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(b) Upon the acceptance of any appointment as the Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article X shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement.
ARTICLE X.
MISCELLANEOUS
SECTION 10.01. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, telecopy or similar teletransmission or writing) and shall be given to
such party at its address or applicable teletransmission number set forth on
the signature pages hereof, or such other address or applicable
teletransmission number as such party may hereafter specify by notice to the
Agent and Borrower. Each such notice, request or other communication shall be
effective (i) if given by telex, when such telex is transmitted to the telex
number specified in this Section and the appropriate answerback is received,
(ii) if given by mail, 72 hours after such communication is deposited in the
mails with first class postage prepaid, addressed as aforesaid, (iii) if given
by telecopy, when such telecopy is transmitted to the telecopy number specified
in this Section and the appropriate confirmation is received, or (iv) if given
by any other means (including, without limitation, by air courier), when
delivered or received at the address specified in this Section; provided that
notices to the Agent shall not be effective until received.
SECTION 10.02. AMENDMENTS, ETC. No amendment or waiver of
any provision of this Agreement or the other Credit Documents, nor consent to
any departure by any Credit Party therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Lenders, and
then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided that no amendment,
waiver or consent shall, unless in writing and signed by all the Lenders do any
of the following: (i) waive any of the conditions specified in Section 4.01 or
4.02, (ii) increase the Commitments or other contractual obligations to
Borrower under this Agreement, (iii) reduce the principal of, or interest on,
the Notes or any fees hereunder, (iv) postpone any date fixed for the payment
in respect of principal of, or interest on, the Notes or any fees hereunder,
(v) change the percentage of the Commitments or of the
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aggregate unpaid principal amount of the Notes, or the number or identity of
Lenders which shall be required for the Lenders or any of them to take any
action hereunder, (vi) agree to release any Credit Party from its obligations
under any Intercompany Note, (vii) modify the definition of "Required
Lenders," or (viii) modify this Section 10.02. Notwithstanding the foregoing,
no amendment, waiver or consent shall, unless in writing and signed by the
Agent in addition to the Lenders required hereinabove to take such action,
affect the rights or duties of the Agent under this Agreement or under any
other Credit Document.
SECTION 10.03. NO WAIVER; REMEDIES CUMULATIVE. No failure or
delay on the part of the Agent, any Lender or any holder of a Note in
exercising any right or remedy hereunder or under any other Credit Document,
and no course of dealing between any Credit Party and the Agent, any Lender or
the holder of any Note shall operate as a waiver thereof, nor shall any single
or partial exercise of any right or remedy hereunder or under any other Credit
Document preclude any other or further exercise thereof or the exercise of any
other right or remedy hereunder or thereunder. The rights and remedies herein
expressly provided are cumulative and not exclusive of any rights or remedies
which the Agent, any Lender or the holder of any Note would otherwise have. No
notice to or demand on any Credit Party not required hereunder or under any
other Credit Document 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 Agent, the Lenders or the holder of any Note to any
other or further action in any circumstances without notice or demand.
SECTION 10.04. PAYMENT OF EXPENSES, ETC. Borrower shall:
(i) whether or not the transactions hereby contemplated
are consummated, pay all reasonable, out-of-pocket costs and expenses
of the Agent in the administration (both before and after the
execution hereof and including reasonable expenses actually incurred
relating to advice of counsel as to the rights and duties of the Agent
and the Lenders with respect thereto) of, and in connection with the
preparation, execution and delivery of, preservation of rights under,
enforcement of, and, after a Default or Event of Default, refinancing,
renegotiation or restructuring of, this Agreement and the other Credit
Documents and the documents and instruments referred to therein, and
any amendment, waiver or consent relating thereto (including, without
limitation, the reasonable fees actually incurred and disbursements of
counsel for the Agent), and in the case of enforcement of this
Agreement or any Credit Document after an Event of Default, all such
reasonable, out-of-pocket costs
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and expenses (including, without limitation, the reasonable fees
actually incurred and reasonable disbursements and charges of
counsel), for any of the Lenders;
(ii) subject, in the case of certain Taxes, to the
applicable provisions of Section 3.07(b), pay and hold each of the
Lenders harmless from and against any and all present and future
stamp, documentary, and other similar Taxes with respect to this
Agreement, the Notes and any other Credit Documents, any collateral
described therein, or any payments due thereunder, and save each
Lender harmless from and against any and all liabilities with respect
to or resulting from any delay or omission to pay such Taxes; and
(iii) indemnify the Agent and each Lender, and their
respective officers, directors, employees, representatives and agents
from, and hold each of them harmless against, any and all costs,
losses, liabilities, claims, damages or expenses incurred by any of
them (whether or not any of them is designated a party thereto) (an
"Indemnitee") arising out of or by reason of any investigation,
litigation or other proceeding related to any actual or proposed use
of the proceeds of any of the Loans or any Credit Party's entering
into and performing of the Agreement, the Notes, or the other Credit
Documents, including, without limitation, the reasonable fees actually
incurred and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding; provided, however,
Borrower shall not be obligated to indemnify any Indemnitee for any of
the foregoing arising out of such Indemnitee's gross negligence or
willful misconduct;
(iv) without limiting the indemnities set forth in
subsection (iii) above, indemnify each Indemnitee for any and all
reasonable expenses and costs (including without limitation, remedial,
removal, response, abatement, cleanup, investigative, closure and
monitoring costs), losses, claims (including claims for contribution
or indemnity and including the cost of investigating or defending any
claim and whether or not such claim is ultimately defeated, and
whether such claim arose before, during or after any Credit Party's
ownership, operation, possession or control of its business, property
or facilities or before, on or after the date hereof, and including
also any amounts paid incidental to any compromise or settlement by
the Indemnitee or Indemnitees to the holders of any such claim),
lawsuits, liabilities, obligations, actions, judgments, suits,
disbursements, encumbrances, liens, damages (including without
limitation damages for contamination or destruction of natural
resources), penalties and fines of any kind or nature
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whatsoever (including without limitation in all cases the reasonable
fees actually incurred, other charges and disbursements of counsel in
connection therewith) incurred, suffered or sustained by that
Indemnitee based upon, arising under or relating to Environmental Laws
based on, arising out of or relating to in whole or in part, the
existence or exercise of any rights or remedies by any Indemnitee
under this Agreement, any other Credit Document or any related
documents.
If and to the extent that the obligations of Borrower under this Section 10.04
are unenforceable for any reason, Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.
SECTION 10.05. RIGHT OF SETOFF. In addition to and not in
limitation of all rights of offset that any Lender or other holder of a Note
may have under applicable law, each Lender or other holder of a Note shall,
upon the occurrence of any Event of Default and whether or not such Lender or
such holder has made any demand or any Credit Party's obligations have matured,
have the right to appropriate and apply to the payment of any Credit Party's
obligations hereunder and under the other Credit Documents, all deposits of any
Credit Party (general or special, time or demand, provisional or final) then or
thereafter held by and other indebtedness or property then or thereafter owing
by such Lender or other holder to any Credit Party, whether or not related to
this Agreement or any transaction hereunder. Each Lender agrees to give the
Borrower prompt notice after the exercise by such Lender of the rights
described in this Section 10.05, but the failure of such Lender to give such
notice shall not affect the validity of the exercise of any such right. Any
amounts received by the Lenders with respect to the exercise of any such right
of offset shall be applied as set forth in Section 3.15 unless such offset was
against funds held in a special account expressly pledged to secure other
obligations of the Borrower to such Lender.
SECTION 10.06. BENEFIT OF AGREEMENT; ASSIGNMENTS AND
PARTICIPATIONS.
(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 Borrower may not assign or transfer any of its
interest hereunder without the prior written consent of the Lenders.
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(b) Any Lender may make, carry or transfer Loans at, to
or for the account of, any of its branch offices or the office of an Affiliate
of such Lender.
(c) Each Lender may assign all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of any of its Commitments and the Loans and Letter of Credit
Obligations at the time owing to it and the Notes held by it) to any financial
institution; provided, however, that (i) the Agent and Borrower must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld or delayed) unless such assignment is to an Affiliate of
the assigning Lender, (ii) the amount of the Commitments of the assigning
Lender subject to each assignment (determined as of the date the assignment and
acceptance with respect to such assignment is delivered to the Agent) shall not
be less than an amount equal to $10,000,000 or greater integral multiplies
thereof, and (iii) the parties to each such assignment shall execute and
deliver to the Agent an Assignment and Acceptance, together with the Note or
Notes subject to such assignment and, unless such assignment is to an Affiliate
of such Lender, a processing and recordation fee of $3,000. Borrower shall not
be responsible for such processing and recordation fee or any costs or expenses
incurred by any Lender or the Agent in connection with such assignment. From
and after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, the assignee thereunder shall be a party hereto and to the extent of
the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement. Notwithstanding the foregoing,
the assigning Lender must retain after the consummation of such Assignment and
Acceptance, a minimum aggregate amount of Commitments of $5,000,000 or such
lesser amount shown on the signature page of such Lender; provided, however, no
such minimum amount shall be required with respect to any such assignment made
at any time there exists an Event of Default hereunder. Within five (5)
Business Days after receipt of the notice and the Assignment and Acceptance,
Borrower, at its own expense, shall execute and deliver to the Agent, in
exchange for the surrendered Note or Notes, a new Note or Notes to the order of
such assignee in a principal amount equal to the applicable Commitments assumed
by it pursuant to such Assignment and Acceptance and new Note or Notes to the
assigning Lender in the amount of its retained Commitment or Commitments. Such
new Note or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes, shall be dated
the date of the surrendered Note or Notes which they replace, and shall
otherwise be in substantially the form attached hereto.
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(d) Each Lender may, without the consent of Borrower or
the Agent, sell participations to one or more banks or other entities in all or
a portion of its rights and obligations under this Agreement (including all or
a portion of its Revolving Credit Commitments and the Loans owing to it and the
Notes held by it), provided, however, that (i) no Lender may sell a
participation in its aggregate Commitments (after giving effect to any
permitted assignment hereof) in an amount in excess of fifty percent (50%) of
such aggregate Commitments, provided, however, sales of participations to an
Affiliate of such Lender shall not be included in such calculation; provided,
however, no such maximum amount shall be applicable to any such participation
sold at any time there exists an Event of Default hereunder, (ii) such Lender's
obligations under this Agreement shall remain unchanged, (iii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations, and (iv) the participating bank or other entity shall not
be entitled to the benefit (except through its selling Lender) of the cost
protection provisions contained in Article IV of this Agreement, and (v)
Borrower and the Agent and other Lenders shall continue to deal solely and
directly with each Lender in connection with such Lender's rights and
obligations under this Agreement and the other Credit Documents, and such
Lender shall retain the sole right to enforce the obligations of Borrower
relating to the Loans and to approve any amendment, modification or waiver of
any provisions of this Agreement.
(e) Any Lender or participant may, in connection with the
assignment or participation or proposed assignment or participation, pursuant
to this Section, disclose to the assignee or participant or proposed assignee
or participant any information relating to Borrower or the other Consolidated
Companies furnished to such Lender by or on behalf of Borrower or any other
Consolidated Company. With respect to any disclosure of confidential,
non-public, proprietary information, such proposed assignee or participant
shall agree to use the information only for the purpose of making any necessary
credit judgments with respect to this credit facility and not to use the
information in any manner prohibited by any law, including without limitation,
the securities laws of the United States. The proposed participant or assignee
shall agree not to disclose any of such information except (i) to directors,
employees, auditors or counsel to whom it is necessary to show such
information, each of whom shall be informed of the confidential nature of the
information, (ii) in any statement or testimony pursuant to a subpoena or order
by any court, governmental body or other agency asserting jurisdiction over
such entity, or as otherwise required by law (provided prior notice is given to
Borrower and the Agent unless otherwise prohibited by the subpoena, order or
law), and (iii) upon the request or demand of any regulatory agency or
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authority with proper jurisdiction. The proposed participant or assignee shall
further agree to return all documents or other written material and copies
thereof received from any Lender, the Agent or Borrower relating to such
confidential information unless otherwise properly disposed of by such entity.
(f) Any Lender may at any time assign all or any portion
of its rights in this Agreement and the Notes issued to it to a Federal Reserve
Bank; provided that no such assignment shall release the Lender from any of its
obligations hereunder.
(g) If any Lender requests compensation pursuant to
Section 3.07(b), Section 3.10(a) or Section 3.16, or the obligations of any
Lender to make Eurodollar Advances, or to continue or to convert Base Rate
Advances into, Eurodollar Advances, shall be suspended pursuant to Section
3.09(b) or Section 3.10(b), then and in such event, upon request from the
Borrower delivered to such Lender and the Agent, such Lender shall assign, in
accordance with the provisions of Section 10.06(c), all of its rights and
obligations under this Agreement and the other Credit Documents to another
Lender or other financial institution selected by the Borrower and consented to
by the Agent in consideration for the payment by such assignee to the Lender of
the principal of and interest on the outstanding Loans accrued to the date of
such assignment, together with any and all other amounts owing to such Lender
under any provisions of this Agreement or the other Credit Documents accrued to
the date of such assignment, and the assumption of such Lender's Revolving
Credit Commitment and Letter of Credit Exposure hereunder.
SECTION 10.07. GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND UNDER THE NOTES SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF GEORGIA.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT, THE NOTES OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE
SUPERIOR COURT OF ▇▇▇▇▇▇ COUNTY, GEORGIA, OR ANY OTHER COURT OF THE STATE OF
GEORGIA OR OF THE UNITED STATES OF AMERICA FOR THE NORTHERN DISTRICT OF
GEORGIA, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, BORROWER HEREBY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. TO THE EXTENT
PERMITTED UNDER APPLICABLE LAW, THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE
TRIAL BY JURY, AND BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION TO THE
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LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS.
(c) Nothing herein shall affect the right of the Agent,
any Lender, any holder of a Note or any Credit Party to serve process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against Borrower in any other jurisdiction.
SECTION 10.08. INDEPENDENT NATURE OF LENDERS' RIGHTS. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights pursuant to this Agreement and its Notes, and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.
SECTION 10.09. 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.
SECTION 10.10. EFFECTIVENESS; SURVIVAL.
(a) This Agreement shall become effective on the date
(the "Effective Date") on which all of the parties hereto shall have signed a
copy hereof (whether the same or different copies) and shall have delivered the
same to the Agent pursuant to Section 10.01 or, in the case of the Lenders,
shall have given to the Agent written or telex notice (actually received) that
the same has been signed and mailed to them.
(b) The obligations of Borrower under Sections 3.07(b),
3.10, 3.12, 3.13, 3.16 and 10.04 hereof shall survive the payment in full of
the Notes after the Maturity Date. All representations and warranties made
herein, in the certificates, reports, notices, and other documents delivered
pursuant to this Agreement shall survive the execution and delivery of this
Agreement, the other Credit Documents, and such other agreements and documents,
the making of the Loans hereunder, and the execution and delivery of the Notes.
SECTION 10.11. SEVERABILITY. In case any provision in or
obligation under this Agreement or the other Credit Documents shall be invalid,
illegal or unenforceable, in whole or in part, in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or
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obligation in any other jurisdiction, shall not in any way be affected or
impaired thereby.
SECTION 10.12. INDEPENDENCE OF COVENANTS. All covenants
hereunder shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the limitation of, another
covenant, shall not avoid the occurrence of a Default or an Event of Default if
such action is taken or condition exists.
SECTION 10.13. CHANGE IN ACCOUNTING PRINCIPLES, FISCAL YEAR
OR TAX LAWS. If (i) any preparation of the financial statements referred to in
Section 6.07 hereafter occasioned by the promulgation of rules, regulations,
pronouncements and opinions by or required by the Financial Accounting
Standards Board or the American Institute of Certified Public Accounts (or
successors thereto or agencies with similar functions) result in a material
change in the method of calculation of financial covenants, standards or terms
found in this Agreement, (ii) there is any change in Borrower's fiscal quarter
or fiscal year which is consented to by the Required Lenders, or (iii) there is
a material change in federal tax laws which materially affects any of the
Consolidated Companies' ability to comply with the financial covenants,
standards or terms found in this Agreement, Borrower and the Required Lenders
agree to enter into negotiations in order to amend such provisions so as to
equitably reflect such changes with the desired result that the criteria for
evaluating any of the Consolidated Companies' financial condition shall be the
same after such changes as if such changes had not been made. Unless and until
such provisions have been so amended, the provisions of this Agreement shall
govern.
SECTION 10.14. HEADINGS DESCRIPTIVE; ENTIRE AGREEMENT. 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. This Agreement, the other
Credit Documents, and the agreements and documents required to be delivered
pursuant to the terms of this Agreement constitute the entire agreement among
the parties hereto and thereto regarding the subject matters hereof and thereof
and supersede all prior agreements, representations and understandings related
to such subject matters.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered in Atlanta, Georgia, by their duly
authorized officers as of the day and year first above written.
Address for Notices: ▇▇▇▇▇ ENTERPRISES, INC.
-------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Attn: Chief Financial Officer ---------------------------------------
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief
Executive Officer
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Secretary
[CORPORATE SEAL]
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Address for Notices: SUNTRUST BANK, ATLANTA
------------------- AS AGENT
▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇-▇▇▇ ▇. Hattink
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ---------------------------------
Title: First Vice President
Telecopy No.: 404/588-8833
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Title: Corporate Banking Officer
Payment Office:
--------------
▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Address for Notices: SUNTRUST BANK, ATLANTA
-------------------
▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇-▇▇▇ ▇. Hattink
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ---------------------------------
Title: First Vice President
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Title: Corporate Banking Officer
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
REVOLVING CREDIT COMMITMENT: $25,000,000.00
PRO RATA SHARE OF REVOLVING
LOAN COMMITMENTS: 41.667%
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Address for Notices: WACHOVIA BANK OF GEORGIA, N.A.
-------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
29th Floor
Mail Code 3940 By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ---------------------------------
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Title: Vice President
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
REVOLVING CREDIT COMMITMENT: $20,000,000.00
PRO RATA SHARE OF REVOLVING
LOAN COMMITMENTS: 33.333%
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Address for Notices: FLEET BANK OF MAINE
-------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Attention: ▇▇▇▇ ▇▇▇▇▇▇ ---------------------------------------
Title: Vice President
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
REVOLVING CREDIT COMMITMENT: $15,000,000.00
PRO RATA SHARE OF REVOLVING
LOAN COMMITMENTS: 25.00%
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96
SCHEDULE 1.01
INTERCOMPANY LOANS
Borrower advances funds to its leather operations (Irving Tanning
Company ("Irving"), Kroy Tanning Company, Incorporated and Seagrave Leather
Corporation) to support their working capital needs. Such advances at
September 30, 1995 were $9,000,000. Interest is charged to the leather
operations at LIBOR + 125 b.p. Pursuant to an Intercompany Note to be executed
by Irving in favor of Borrower, Borrower intends to advance the proceeds of the
initial borrowing under the Credit Agreement to Irving who will in turn use the
proceeds to pay in full the Indebtedness described on Schedule 5.18. Such
advances have not previously been evidenced by formal note agreement and,
except as noted, are not expected to be affected by the Closing.
97
SCHEDULE 5.01
ORGANIZATION AND OWNERSHIP OF SUBSIDIARIES
The jurisdiction of incorporation and the ownership of all issued and
outstanding capital stock for each Subsidiary of Borrower are as follows:
Jurisdiction of Date of Percentage of
Name of Subsidiary Incorporation Incorporation Ownership
---------------------------- -------------- ------------- -------------
American Southern Insurance Company Georgia 12-14-36 100%
American Safety Insurance Company Georgia 1-14-88 100%
Automated Systems of Georgia, Inc. Georgia 9-12-89 100%
Automobile Safety Management, Inc. Delaware 9-17-79 100%
Premier Adjusting & Claims Service, Inc. Georgia 2-3-95 100%
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇ Tanners, Inc. Delaware 2-3-70 100%
Irving Tanning Company Delaware 3-30-62 100%
Irving Leather Company Maine 3-16-78 100%
Vista Leather International Corp. Barbados 7-18-94 100%
Kroy Tanning Company, Incorporated Delaware 2-2-65 100%
Collagen International Products Corporation New York 6-30-70 100%
Seagrave Leather Corporation Maine 10-1-79 100%
Wilton Tanning Company Maine 6-29-59 100%
98
SCHEDULE 5.05
CERTAIN PENDING AND THREATENED LITIGATION
Hall v. Vista Resources, Inc., Civil Action ▇▇. ▇▇▇ ▇▇-▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇. In September 1991, an action was
instituted against Borrower and an unrelated third party, alleging product
liability, negligence and breach of warranty. The plaintiff seeks damages for
each of the allegations of up to $10,000,000. The plaintiff claims, among
other things, that Maxim Motors, a former division of Borrower which was sold
in 1975, had failed to design certain safety features in a fire truck
manufactured and sold by Maxim Motors in 1972. Subsequently, the plaintiff
dropped the action against the unrelated third party. Borrower, which is
insured for up to $8,000,000 and is being defended by its insurance carrier,
denies the allegations in this action.
99
SCHEDULE 5.08(a)
ENVIRONMENTAL COMPLIANCE
None.
100
SCHEDULE 5.08(b)
ENVIRONMENTAL NOTICES
None.
101
SCHEDULE 5.08(c)
ENVIRONMENTAL PERMITS
None.
102
SCHEDULE 5.11
BURDENSOME RESTRICTIONS
None.
103
SCHEDULE 5.12
TAX FILINGS AND PAYMENTS
Since 1994, American Southern Insurance Company, a subsidiary of
Borrower ("American Southern"), has paid premium taxes in Florida in accordance
with the methodology advocated by the Florida Department of Revenue (the
"Department") in the Florida Premium Tax Litigation described below (the
"Florida Methodology"). For the period from the acquisition of American
Southern through 1993, American Southern did not pay premium taxes in Florida
in accordance with the Florida Methodology. Consequently, to the extent that
the Department prevails in the Florida Premium Tax Litigation and American
Southern is subsequently audited, American Southern estimates that its possible
premium tax exposure in the 1991 through 1993 period is approximately $228,000
plus interest and penalties of approximately $70,000. The full amount of
approximately $298,000 is fully reserved for in American Southern's GAAP
financial statements. With respect to the portion of the 1991 tax year during
which InterRedec Southern Company, Inc. ("InterRedec") owned American Southern,
American Southern estimates that its potential premium tax liability (for which
Borrower would seek indemnification) is approximately $122,500 with related
penalties and interest of approximately $52,700 and $12,250, respectively.
These amounts are not reserved for in American Southern's GAAP financial
statements.
American Southern has a lawsuit (Civil Action No. 95-2588) pending
with the Department in Florida (the "Florida Premium Tax Litigation"). The
issue revolves around the appropriate retaliatory premium tax to be paid by
American Southern to Florida. The Department is alleging that the Georgia tax
rate is 2.25% and the local premium tax rate is 2.5% for a total rate of 4.75%.
The Florida tax rate is 2%. The Department is effectively saying that the
retaliatory rate should be 2.75%. American Southern's major argument is that
in Georgia there is an investment offset available to all companies that can
reduce the effective Georgia rate from 2.25% to .5% and American Southern has
always qualified for this reduction. With a Georgia rate of .5% and a local
premium tax of 2.5%, the total Georgia tax is 3% compared to Florida's 2% for a
retaliatory rate of 1%.
The amount of tax in dispute is approximately $839,999 for the years
1985 through 1990. Penalties and interest with respect to the disputed tax
amount are approximately $748,000 and $86,700, respectively. If the suit is
lost, Borrower intends to seek indemnification from InterRedec, the owner of
American Southern during the period from 1985 to 1990.
In 1993, this suit was tried and American Southern won. In 1994, the
Florida legislature passed a law which was intended to retroactively change the
way the retaliatory tax was calculated. The Department then asked the trial
judge to rehear the case in light of the new Florida law. The case was heard
in November 1994 and in July 1995 the judge ruled for the Department. The case
is now under appeal.
104
SCHEDULE 5.15
EMPLOYEE BENEFIT MATTERS
The following is a list of all of the Plans of Borrower, none of which (other
than the Plan described in number 4) is subject to Title IV of ERISA:
1. Vista Leather Group Savings and Retirement Plan (the "Plan").
Borrower's officers and employees participate with Irving Tanning
Company and ▇▇▇▇▇▇▇▇▇ Leather Corporation in a combined qualified
401(k) and 401(a) plan covering all employees of the three companies.
The plan was established under the Group Prototype Profit Sharing and
401(k) Plan No. 3 of State Mutual Life Assurance Company of America.
2. Employers Health Insurance, Emphesys Financial Group, Inc./Group No.
6022397. Borrower's officers and employees participate with officers
and employees of ▇▇▇▇▇ Capital Corporation and other ▇▇▇▇▇ company
employees in this plan which provides medical, dental and life
insurance coverages for participants at the expense of the employers.
3. UNUM Life Insurance Company of America. Borrower's corporate office
officers and employees participate with officers and employees of
▇▇▇▇▇ Capital Corporation and other ▇▇▇▇▇ Companies in this plan which
provides long-term disability coverage.
4. American Southern Insurance Company Retirement Plan. On behalf of
employees who are 21 years of age or older and have been employed for
at least one year, American Southern contributes to an employer funded
defined benefit plan. Normal retirement age under the plan is age 65.
5. Prudential Health Care Plan of Georgia, Inc./Group Agreement No.
57585. American Southern provides medical and life insurance coverage
for its regular, full-time employees and their dependents, and
accidental death and dismemberment insurance for these same employees.
6. The Guardian Life Insurance Company of America/Policy No. 248010-GN.
American Southern provides dental insurance for its regular, full-time
employees and their dependents after completion of one month of
continuous employment.
7. Continental Casualty Company/Policy No. SR-83087420. American
Southern provides long-term disability insurance to regular, full-time
employees after completion of one month of continuous employment. In
conjunction with this insurance, all employees are provided access to
an Employee Assistance Program (EAP) operated by ▇▇▇▇▇▇▇▇▇, DuPont &
Associates for assessment and referral.
8. Continental Casualty Company/Policy No. SR-83074901. American
Southern provides travel accident insurance for all active, full-time
employees.
105
SCHEDULE 5.16
PATENT, TRADEMARK, LICENSE AND
OTHER INTELLECTUAL PROPERTY MATTERS
None.
106
SCHEDULE 5.17
OWNERSHIP OF PROPERTIES
None.
107
SCHEDULE 5.18
EXISTING INDEBTEDNESS
Description of Indebtedness Estimated Principal, Interest and Expenses Due
--------------------------- ----------------------------------------------
At Closing
-----------
- Revolving Credit and Term Loan
Agreement between Fleet Bank of Maine
and Irving Tanning Company (together
with all amendments and addenda
thereto) $12,084,939.86
- Demand Promissory Notes between Shawmut
Bank, N.A. and Irving Tanning Company,
dated April 24, 1992 and September 15,
1994 and Term Loan Note between Shawmut
Bank, N.A. and Irving Tanning Company,
dated September 13, 1993. $ 3,685,941.57
108
SCHEDULE 5.20
LABOR AND EMPLOYMENT MATTERS
None.
109
SCHEDULE 5.21
DIVIDEND RESTRICTIONS
Payment of dividends by American Southern to Borrower unless approved
by the Georgia Insurance Commissioner, is limited to the greater of 10% of
statutory net worth or net income, excluding capital gains, of the preceding
year.
110
SCHEDULE 6.08
FINANCIAL COVENANT CALCULATIONS - SECOND QUARTER 1995
Debt to Capital Ratio ($ amounts in thousands) June 30, 1995
-------------
a. Funded Debt (including the current a. $33,486
portion thereof of Consolidated
Companies)
b. Funded Debt of Other Persons Guaranteed b. 0
by a Consolidated Company
c. Required Stock Redemptions in next 12 c. 0
months
d. Debt outstanding pursuant to SunTrust d. 0
Line of Credit
e. Adjusted Funded Debt (a+b+c+d) e. $33,486
f. Net Worth of Borrower less Treasury f. $70,438
Stock
g. Total Capitalization (e+f) g. $103,924
h. Leverage Ratio (e/g) h. .322 : 1.00
i. Maximum Leverage Ratio i. .6 : 1.00
j. Default Indicated? j. No
Interest Coverage Ratio 1994 1995 Total
---------------------- ---------------------- --------------
Preceding 4
Q3 Q4 Q1 Q2 Quarters
-------- -------- -------- -------- --------------
a. Consolidated EBIT a. $3858 $4707 $2562 $3337 $14,464
b. Consolidated Interest b. $ 417 $ 481 $ 547 $ 688 $ 2,133
Expense
c. Ratio of a to b c. 6.78 : 1.00
d. Minimum Ratio d. 2.0 : 1.00
e. Default Indicated? e. No
Cash Flow Coverage Ratio 1994 1995 Total
---------------------- ---------------------- --------------
Preceding 4
Q3 Q4 Q1 Q2 Quarters
-------- -------- -------- -------- -------------
a. Consolidated EBIT a. $3858 $4707 $2562 $3337 $14,464
b. Depreciation and b. $ 483 $ 447 $ 528 $ 565 $ 2,023
Amortization
c. Consolidated EBITDA c. $16,487
(a+b)
d. Consolidate Funded d. $33,486
Debt
e. Ratio of d/c e. 2.03 : 1.00
f. Maximum Ratio f. 3.5 : 1.00
g. Default Maximum g. No
Indicated?
111
SCHEDULE 7.01
OUTSTANDING INDEBTEDNESS
Estimated Principal Amount
---------------------------
Outstanding September 30, 1995
------------------------------
- Non-negotiable Promissory Note, dated
October 11, 1991, between Borrower and
InterRedec Southern Company, Inc.,
which note has been assigned by
InterRedec Southern Company, Inc. to $11,282,000
the Board of Governors of the Federal
Reserve System.
- Industrial Revenue Bonds and Related
Agreements between Town of Hartland,
Maine, and Irving Tanning Company
- Maturing October 1, 2004 $ 1,159,000
- Maturing November 1, 1997 $ 185,250
- Maturing March 1, 2001 $ 256,500
- Equipment financing obligation to
Poletto due in installments through
July 4, 1996 $ 47,664
- Agreement between the Town of Hartland,
Maine, and Irving Tanning Company,
dated September 26, 1994, related to
General Obligation Bonds
$1,370,000
- Indebtedness described on Schedule
1.01.
112
SCHEDULE 7.02
EXISTING LIENS
Secured Party Security
------------- --------
InterRedec Southern Company, Inc. 49% of the common stock of American Southern
Insurance Company (stock pledge to be released
upon delivery of the letter of credit referred
to in Section 7.01(c) of the Credit Agreement).
Poletto Equipment
Town of Hartland, Maine and holders of Water treatment facilities and waste disposal
industrial revenue and general obligation bonds, facilities
existing lien holders and related security of
bonds when such entity is acquired by Borrower
113
SCHEDULE 7.05
EXISTING INVESTMENTS
See attached Exhibits A and B for the statements at September 30, 1995
for Wachovia Bank and Daily Tax Free Income Fund, Inc., respectively, for
investments held by Borrower. These investments are held in the name of
Borrower and are distinct and different from investments held by American
Southern at September 30, 1995.
114
SCHEDULE 7.05
EXHIBIT A
115
WACHOVIA CAPITAL MANAGEMENT ACCOUNT NUMBER:
▇.▇. ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
VISTA RESOURCES, INC
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
WACHOVIA
116
YOUR ACCOUNT MANAGER IS:
▇▇▇▇ ▇▇▇▇▇▇▇▇ PAGE: 1
VICE PRESIDENT
▇▇▇-▇▇▇-▇▇▇▇ ACCOUNT NUMBER:
________________________________________________________________________________
WACHOVIA BANK OF GEORGIA, N.A.
AS CUSTODIAN FOR
VISTA RESOURCES, INC
STATEMENT
SEPTEMBER 01, 1995 THROUGH SEPTEMBER 29, 1995
WACHOVIA
117
PAGE: 2
SUMMARY OF ACCOUNT
VISTA RESOURCES INC 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
ESTIMATED CURRENT
TOTAL TAX MARKET ANNUAL YIELD
DESCRIPTION OF ASSETS COST VALUE INCOME (%)
--------------------- --------- ------ --------- -------
COMMON STOCKS $ 537.55 $ 910.83 $ 17 1.9
PREFERRED STOCKS 4,381,223.63 4,404,303.13 279,761 6.4
BONDS 3,988,750.00 4,016,240.00 250,000 6.2
SHORT-TERM RESERVES AND CASH 805,494.07 805,494.07 44,694 5.5
------------- ------------- -------- ---
TOTAL VALUE OF ACCOUNT $9,176,005.25 $9,226,948.03 $574,472 6.2
============= ============= ======== ===
THE VALUES USED IN THIS REPORT ARE AS OF THE CLOSE OF BUSINESS ON THE REPORT
DATE OR THE MOST REPRESENTATIVE VALUE AVAILABLE ON THAT DATE.
WACHOVIA
118
PAGE: 3
LIST OF ASSETS
VISTA RESOURCES INC 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
SHARES ESTIMATED CURRENT
UNITS, OR TOTAL TAX MARKET ANNUAL YIELD
PAR VALUE DESCRIPTION COST VALUE INCOME (%)
--------- ----------- --------- ------ --------- -------
COMMON STOCKS
-------------
1 ALLIED GROUP INC $ 19.75 $ 32.75 $ 1 3.1
1 ▇▇▇▇▇▇▇ ▇▇ CORP 28.00 45.38
1 CHUBB CORP 67.25 96.00 2 2.1
1 FOREMOST CORP AMER 20.50 44.25 1 2.3
5 GEICO CORP 191.38 341.25 5 1.5
1 HARTFORD STEAM BOILER 49.25 48.38 2 4.1
INSPECTION & INS CO
2 OHIO CASUALTY CORP 49.50 71.50 3 4.2
1 ORION CAP CORP 20.16 44.38 1 2.3
3 PROGRESSIVE CORP OHIO 49.75 134.25 1 .7
1 SEIBELS ▇▇▇▇▇ GROUP INC 5.88 .81
1 SELECTIVE INS GROUP INC 17.00 36.50 1 2.7
1 20TH CENTY INDS CAL 19.13 15.38
COM NO PAR
TOTAL COMMON STOCKS $ 537.55 $ 910.83 $ 17 1.9
----------- ----------- ------- ---
PREFERRED STOCKS
----------------
10,000 ALABAMA PWR CO $260,000.00 $253,750.00 $19,000 7.5
2ND PFD CL A 7.60%
WACHOVIA
119
PAGE: 4
LIST OF ASSETS
VISTA RESOURCES INC 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
SHARES ESTIMATED CURRENT
UNITS, OR TOTAL TAX MARKET ANNUAL YIELD
PAR VALUE DESCRIPTION COST VALUE INCOME (%)
--------- ----------- --------- ------ ------ -------
2,500 BALTIMORE GAS & ELECTRIC CO $265,000.00 $240,312.50 $17,813 7.4
PFD SER 1993 7.125%
5,075 CAROLINA PWR & LT CO 481,504.63 514,478.13 40,346 7.8
PFD $7.95
12,000 DUKE POWER CO 300,000.00 282,000.00 19,128 6.8
PFD SER A1993 6.375%
4,000 DUKE POWER CO 413,000.00 403,000.00 28,160 7.0
PFD PERP 7.04%
USD100.000
3,000 FLORIDA POWER & LIGHT CO 302,625.00 289,875.00 20,250 7.0
PFD SER U 6.75%
2,000 FLORIDA POWER & LIGHT CO 203,750.00 202,000.00 14,100 7.0
PFD SER T 7.05%
8,000 GEORGIA PWR CO 200,000.00 200,000.00 15,400 7.7
PFD CL A %
8,000 GEORGIA PWR CO 200,000.00 212,000.00 17,000 8.0
PFD CL A $2.125
2,320 NEW YORK STATE ELEC & GAS CORP 170,079.00 201,550.00 15,034 7.5
PFD 6.48%
10,000 OHIO EDISON CO 250,000.00 247,500.00 19,370 7.8
PFD 7.75% CL A
10,000 PSI ENERGY INC 256,250.00 253,750.00 18,600 7.3
PFD
4,000 SAVANNAH ELECTRIC & POWER CO 98,500.00 94,000.00 6,640 7.1
PFD 6.64%
WACHOVIA
120
PAGE: 5
LIST OF ASSETS
VISTA RESOURCES INC 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
SHARES ESTIMATED CURRENT
UNITS, OR TOTAL TAX MARKET ANNUAL YIELD
PAR VALUE DESCRIPTION COST VALUE INCOME (%)
--------- ----------- --------- ------ --------- -------
900 SOUTHWESTERN PUB SVC CO $ 61,763.00 $ 92,587.50 $ 7,200 7.8
PFD 8%
12,000 TEXAS UTIL ELEC CO 300,000.00 300,000.00 21,720 7.2
DEP SHS REP1/4 SH $7.22
CUM PFD
5,000 VIRGINIA ELEC & PWR CO 493,752.00 495,000.00
PFD $7.45
5,000 WEST PENN POWER CO 125,000.00 122,500.00
8.00% QUARTERLY
DEBT SECS (QIDS) PFD
TOTAL PREFERRED STOCKS $4,381,223.63 $4,404,303.13 $279,761 6.4
------------- ------------- -------- ---
BONDS
-----
4,000,000 UNITED STATES TREAS NTS $3,988,750.00 $4,016,240.00 $250,000 6.2
08/31/94 6.25% 8/31/1996
TOTAL BONDS $3,988,750.00 $4,016,240.00 $250,000 6.2
------------- ------------- -------- ---
SHORT-TERM RESERVES AND CASH
----------------------------
801,936.73 BILTMORE FDS $ 801,936.73 $ 801,936.73 $ 44,694 5.6
MONEY MKT FD INSTL SH CL-A
CASH 3,557.34 3,557.34
TOTAL SHORT-TERM RESERVES AND CASH $ 805,494.07 $ 805,494.07 $ 44,694 5.5
------------- ------------- -------- ---
TOTAL VALUE OF ACCOUNT $9,176,005.25 $9,226,948.03 $574,472 6.2
============= ============= ======== ===
THE VALUES USED IN THIS REPORT ARE AS OF THE CLOSE OF BUSINESS ON THE REPORT
DATE OR THE MOST REPRESENTATIVE VALUE AVAILABLE ON THAT DATE.
WACHOVIA
121
PAGE: 6
CASH SUMMARY
VISTA RESOURCES INC 09/01/95 THROUGH 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
AMOUNT TOTAL
------ -----
OPENING BALANCE 09-01-95 $128,001.67
CASH RECEIPTS
-------------
DIVIDENDS $37,930.10
SALE OF ASSETS
EQUITY 158.61
----------
TOTAL CASH RECEIPTS 38,088.71
NET SHORT TERM RESERVE PURCHASE AND SALES 162,533.04-
-----------
CLOSING BALANCE 09-29-95 $ 3,557.34
===========
WACHOVIA
122
PAGE: 7
STATEMENT DETAIL
VISTA RESOURCES INC 09-01-95 THROUGH 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
CASH RECEIPTS AMOUNT TOTAL
------------- ------ -----
DIVIDENDS
---------
-PREFERRED
DUKE POWER CO
PFD SER A1993 6.375%
09-18-95 DIV $0.398440 ON 12,000 SHS $4,781.28 $4,781.28
FOR PAYABLE DATE OF 09/18/95
DUKE POWER CO
PFD PERP 7.04%
USD100.000
09-18-95 DIV $1.760000 ON 4,000 SHS 7,040.00 7,040.00
FOR PAYABLE DATE OF 09/18/95
FLORIDA POWER & LIGHT CO
PFD SER U 6.75%
09-01-95 DIV $1.687500 ON 3,000 SHS 5,062.50 5,062.50
FOR PAYABLE DATE OF 09/01/95
FLORIDA POWER & LIGHT CO
PFD SER T 7.05%
09-01-95 DIV $1.762500 ON 2,000 SHS 3,525.00 3,525.00
FOR PAYABLE DATE OF 09/01/95
PSI ENERGY INC
PFD
09-01-95 DIV $0.465000 ON 10,000 SHS 4,650.00 4,650.00
FOR PAYABLE DATE OF 09/01/95
WACHOVIA
123
PAGE: 8
STATEMENT DETAIL
VISTA RESOURCES INC 09-01-95 THROUGH 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
AMOUNT TOTAL
------ -----
VIRGINIA ELEC & PWR CO
PFD $7.45
09-20-95 DIV $1.862500 ON 5,000 SHS $9,312.50 $ 9,312.50
FOR PAYABLE DATE OF 09/20/95 ----------
TOTAL PREFERRED $34,371.28
----------
-COMMON
ALLIED GROUP INC
09-26-95 DIV $0.170000 ON 1 SHS 0.17 0.17
FOR PAYABLE DATE OF 09/26/95
FOREMOST CORP AMER
09-15-95 DIV $0.270000 ON 1 SHS 0.27 0.27
FOR PAYABLE DATE OF 09/15/95
GEICO CORP
09-29-95 DIV $0.270000 ON 5 SHS 1.35 1.35
FOR PAYABLE DATE OF 09/29/95
OHIO CASUALTY CORP
09-11-95 DIV $0.380000 ON 2 SHS 0.76 0.76
FOR PAYABLE DATE OF 09/11/95
SELECTIVE INS GROUP INC
09-01-95 DIV $0.280000 ON 1 SHS 0.28 0.28
FOR PAYABLE DATE OF 09/01/95 ----------
TOTAL COMMON $ 2.83
----------
WACHOVIA
124
PAGE: 9
STATEMENT DETAIL
VISTA RESOURCES INC 09-01-95 THROUGH 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
AMOUNT TOTAL
------ -----
-OTHER
BILTMORE FDS
MONEY MKT FD INSTL SH CL-A
09-29-95 DIVIDEND $3,555.99 $ 3,555.99
----------
TOTAL OTHER $ 3,555.99
----------
TOTAL DIVIDENDS $37,930.10
==========
SALE OF ASSETS
--------------
-EQUITY
-COMMON
CINCINNATI FINL CORP
09-01-95 TENDERED TO COMPANY AT 158.61 158.61
$52.87 ON ----------
3 SHARES
AT 52.870
TOTAL COMMON $ 158.61
----------
TOTAL EQUITY $ 158.61
----------
TOTAL SALE OF ASSETS $ 158.61
==========
TOTAL CASH RECEIPTS $38,088.71
==========
WACHOVIA
125
PAGE: 10
STATEMENT DETAIL
VISTA RESOURCES INC 09-01-95 THROUGH 09-29-95 ACCOUNT NUMBER:
________________________________________________________________________________
CASH DISBURSEMENTS AMOUNT TOTAL
------------------ ------ -----
PURCHASE OF ASSETS
------------------
-SHORT TERM
BILTMORE FDS
MONEY MKT FD INSTL SH CL-A
PURCHASES FOR PERIOD 09-01-95 THROUGH 09-29-95 (7) $162,533.04- $162,533.04-
-----------
TOTAL SHORT TERM $162,533.04-
-----------
TOTAL PURCHASE OF ASSETS $162,533.04-
===========
TOTAL CASH DISBURSEMENTS $162,533.04-
===========
WACHOVIA
126
SCHEDULE 7.05
EXHIBIT B
127
Fund Name Account Number Taxpayer I.D. No. Date
-------------------------------- ------------------- ------------------------ -------------------
DAILY TAX FREE INCOME FUND, INC. 09/29/95
VISTA RESOURCES INC NATIONSBANK OF GEORGIA
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇ FUNDS MANAGEMENT
STE 5000 FUNDS MANAGEMENT SALES
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
000000263983
01068 000001 000000001
Date Transaction Description Dollar Amount Share Price Share Amount Shares Owned
---- ----------------------- ------------- ----------- ------------ ------------
09/01 BALANCE FORWARD 3,199,960.680
09/05 PURCHASE BY WIRE 250,000.00 1.00 250,000.000 3,449,960.680
09/06 PURCHASE BY WIRE 190,000.00 1.00 190,000.000 3,639,960.680
09/08 REDEMPTION BY WIRE 25,000.00 1.00 25,000.000 3,614,960.680
09/14 PURCHASE BY WIRE 300,000.00 1.00 300,000.000 3,914,960.680
09/15 MM DIVIDEND REINVEST 10,011.14 1.00 10,011.140 3,924,971.820
09/18 REDEMPTION BY WIRE 460,000.00 1.00 460,000.000 3,464,971.820
09/19 REDEMPTION BY WIRE 8,000.00 1.00 8,000.000 3,456,971.820
09/20 REDEMPTION BY WIRE 3,000.00 1.00 3,000.000 3,453,971.820
09/21 REDEMPTION BY WIRE 150,000.00 1.00 150,000.000 3,303,971.820
09/22 REDEMPTION BY WIRE 20,000.00 1.00 20,000.000 3,283,971.820
09/25 REDEMPTION BY WIRE 175,000.00 1.00 175,000.000 3,108,971.820
09/29 PURCHASE BY WIRE 100,000.00 1.00 100,000.000 3,208,971.820
09/29 ACCOUNT VALUE 3,208,971.82
Summary of Dividends - Year-to-Date
------------------------------------------------------------------------------------------------------------------------------------
Income Dividends Short Term Gains Long Term Gains Accrued Unpaid Dividends Total Income Taxes Withheld
---------------------- -------------------- -------------------- --------------------------- --------------- -----------------
50,314.37 4,484.93 54,799.30 0.00
AS OF SEPTEMBER 29, 1995 THE FUND'S 7-DAY YIELD
WAS 3.66% WITH AN EFFECTIVE YIELD OF 3.73%.
For information please call ▇▇▇-▇▇▇-▇▇▇▇ or ▇▇▇-▇▇▇-▇▇▇▇
> Please Use This Form to Purchase Additional Shares.
------------------------------------------------------------------------------------------------------------------------------------
Minimum
Fund Name Account Number Taxpayer I.D. No. Investment
----------------------------------- ----------------- ---------------------- -----------------
DAILY TAX FREE INCOME FUND, INC. $100
VISTA RESOURCES INC
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ Amount Remitted
---------------------------------------------------------------
$
Make checks payable to the fund
/ / Please Check Here for Change of Address -------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Name City State Zip Signature Date
-------------------------------------- ---------------------- ---------------- ------------- ---------------- ------------
034018600130146300
128
Schedule 8.11
Existing Shareholders
Sole Shared
Sole Shared Dispositive Dispositive
Member of ▇▇▇▇▇ Family Voting Power Voting Power Power Power Beneficially Owned
---------------------- ------------ ------------ ----- ----- -------------------
▇. ▇. ▇▇▇▇▇(1) 693,917 435,698 693,917 435,698 1,129,615
J. ▇▇▇ ▇▇▇▇▇(2) 310,142 435,698 310,142 435,698 745,840
▇▇▇▇▇ Holdings, Inc.(3) 366,000 0 366,000 0 366,000
▇▇▇▇▇ Holdings - I, L.P.(4) 366,000 0 366,000 0 366,000
The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Trust(5) 160,843 0 160,843 0 160,843
The ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Trust(6) 160,842 0 160,842 0 160,842
The ▇. ▇. ▇▇▇▇▇ Foundation, Inc.(7) 69,698 0 69,698 0 69,698
_________________
(1) ▇. ▇. ▇▇▇▇▇ may be deemed to own beneficially (through the power to direct
the vote and disposition thereof) 1,129,615 shares of the common stock, $2.50
par value per share, of Borrower (the "Common Stock") (372,232 individually,
160,843 as trustee for The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Trust, 160,842 shares as
trustee for The ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Trust, 69,698 as an officer and director of
The ▇.▇. ▇▇▇▇▇ Foundation, Inc., and 366,000 as an officer and director of
▇▇▇▇▇ Holdings, Inc.).
(2) J. ▇▇▇ ▇▇▇▇▇ may be deemed to own beneficially (through the power to direct
the vote and disposition thereof) 745,840 shares of the Common Stock (310,142
individually, 69,698 as an officer and director of The ▇.▇. ▇▇▇▇▇ Foundation,
Inc., and 366,000 as an officer and director of ▇▇▇▇▇ Holdings, Inc.).
(3) ▇▇▇▇▇ Holdings, Inc., the general partner of ▇▇▇▇▇ Holdings - I, L.P., may
be deemed to own beneficially (through the power of its sole directors and
shareholders, ▇.▇. ▇▇▇▇▇ and J. ▇▇▇ ▇▇▇▇▇, to direct the vote and disposition
thereof) 366,000 shares of the Common Stock.
(4) ▇▇▇▇▇ Holdings - I, L.P., may be deemed to own beneficially (through the
power of ▇.▇. ▇▇▇▇▇ and J. ▇▇▇ ▇▇▇▇▇ as the sole directors and shareholders of
▇▇▇▇▇ Holdings, Inc., the general partner of ▇▇▇▇▇ Holdings - I, L.P., to
direct the vote and disposition thereof) 366,000 shares of the Common Stock.
(5) The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Trust may be deemed to own beneficially (through
the power of its sole trustee, ▇.▇. ▇▇▇▇▇, to direct the vote and disposition
thereof) 160,843 shares of the Common Stock.
(6) The ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Trust may be deemed to own beneficially (through
the power of its sole trustee, ▇.▇. ▇▇▇▇▇, to direct the vote and disposition
thereof) 160,842 shares of the Common Stock.
(7) The ▇.▇. ▇▇▇▇▇ Foundation, Inc. may be deemed to own beneficially (through
the power of its directors and officers to direct the vote thereof) 69,698
shares of the Common Stock.
129
EXHIBIT A
FORM OF
REVOLVING CREDIT NOTE
U.S. $________________ November __, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
FOR VALUE RECEIVED, the undersigned ▇▇▇▇▇ ENTERPRISES, INC., a
Delaware corporation (herein called the "Borrower"), hereby promises to pay to
the order of __________________, a ___________________________ (herein,
together with any subsequent holder hereof, called the "Lender"), for the
account of its applicable Lending Office, the lesser of (i) the principal sum
of _____________________________________ AND NO/100 UNITED STATES DOLLARS
($_______________) and (ii) the outstanding principal amount of the Advances
made by the Lender to the Borrower as Revolving Loans pursuant to the terms of
the Credit Agreement referred to below on the Maturity Date (as defined in the
Credit Agreement referred to below). The Borrower likewise promises to pay
interest on the outstanding principal amount of each such Advance, at such
interest rates, payable at such times, and computed in such manner, as are
specified for such Advance in the Credit Agreement in strict accordance with
the terms thereof.
The Lender shall record all Advances made pursuant to its Revolving
Credit Commitment under the Credit Agreement and all payments of principal of
such Advances and, prior to any transfer hereof, shall endorse such Advances
and payments on the schedule annexed hereto and made a part hereof, or on any
continuation thereof which shall be attached hereto and made a part hereof or
on the books and records of the Lender, which endorsement shall constitute
prima facie evidence of the accuracy of the information so endorsed; provided,
however, that delay or failure of the Lender to make any such endorsement or
recordation shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement with respect to the Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Revolving Credit Note that is not paid on the due date
therefor, whether on the Maturity Date, whether or not resulting from the
acceleration of maturity upon the occurrence of an Event of Default, shall bear
interest from the date due to payment in full at the rate as provided in
Section 3.03(b) of the Credit Agreement.
130
All payments of principal and interest shall be made in lawful money
of the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement.
This Revolving Credit Note is issued pursuant to, and is one of the
Revolving Credit Notes referred to in, the Credit Agreement dated as of
November __, 1995 among the Borrower, SunTrust Bank, Atlanta, individually and
as Agent, and the other lenders set forth on the signature pages thereof (as
the same may hereafter be amended, modified or supplemented from time to time,
the "Credit Agreement") and each assignee thereof becoming a "Lender" as
provided therein, and the Lender is and shall be entitled to all benefits
thereof and all Security Documents executed and delivered to the Lenders or the
Agent in connection therewith. Terms defined in the Credit Agreement are used
herein with the same meanings. The Credit Agreement, among other things,
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events.
The Borrower agrees to make payments of principal on the Advances
outstanding hereunder as Revolving Loans on the dates and in the amounts
specified in the Credit Agreement for such Advances in strict accordance with
the terms thereof.
This Revolving Credit Note may be prepaid in whole or in part in
accordance with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Revolving Credit Note may
automatically become, or be declared, due and payable in the manner and with
the effect provided in the Credit Agreement. The Borrower agrees to pay, and
save the Lender harmless against any liability for the payment of, all
reasonable out-of-pocket costs and expenses, including reasonable attorneys'
fees actually incurred, arising in connection with the enforcement by the
Lender of any of its rights under this Revolving Credit Note or the Credit
Agreement.
THIS REVOLVING CREDIT NOTE HAS BEEN EXECUTED AND DELIVERED IN GEORGIA
AND THE RIGHTS AND OBLIGATIONS OF THE LENDER AND THE BORROWER HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS (WITHOUT GIVING EFFECT
TO THE CONFLICT OF LAW PRINCIPLES THEREOF) OF THE STATE OF GEORGIA.
The Borrower expressly waives any presentment, demand, protest or
notice in connection with this Revolving Credit Note, now or hereafter required
by applicable law. TIME IS OF THE ESSENCE OF THIS REVOLVING CREDIT NOTE.
- 2 -
131
IN WITNESS WHEREOF, the Borrower has caused this Revolving Credit Note
to be executed and delivered under seal by its duly authorized officers as of
the date first above written.
▇▇▇▇▇ ENTERPRISES, INC.
By:
----------------------------------
Name:
Title:
Attest:
----------------------------------
Name:
Title:
[CORPORATE SEAL]
- 3 -
132
Revolving Credit Note (cont'd)
ADVANCES AND PAYMENTS OF PRINCIPAL
Last Day of
Amount Amount of Applicable
of Interest Principal Interest Notation
Date Advance Rate Prepaid Period Made By
-------------------------------------------------------------------------------
- 4 -
133
EXHIBIT B
NOTICE OF BORROWING
SunTrust Bank, Atlanta, as Agent
for the Lenders parties to the
Credit Agreement referenced below
▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
[Date]
Re: ▇▇▇▇▇ ENTERPRISES, INC.
Ladies and Gentlemen:
The undersigned, ▇▇▇▇▇ ENTERPRISES, INC., a Delaware
corporation (the "Borrower"), refers to the Credit Agreement, dated as
of November 6, 1995 (the "Credit Agreement"; the terms defined therein
being used herein as therein defined), among the undersigned, the
lenders (the "Lenders") from time to time parties thereto and SunTrust
Bank, Atlanta, as Agent, and hereby gives you irrevocable notice
pursuant to Section 3.01(a) of the Credit Agreement that the
undersigned hereby requests a Borrowing under the Credit Agreement (the
"Proposed Borrowing"), and in that connection sets forth below the
information relating to such Borrowing as required by Section 3.01(a)
of the Credit Agreement:
(i) The Business Day of the Proposed Borrowing is
_________, 19__.
(ii) The Proposed Borrowing shall be comprised of [Base
Rate Advances] [Eurodollar Advances].*
(iii) The amount of the Proposed Borrowing is
$_____________________.
[(iv) The Interest Period for the Proposed Borrowing if
comprised of Eurodollar Advances is ______
month[s].]**
--------------------
* Total number of outstanding Borrowings may not exceed six.
** Not applicable if the Proposed Borrowing is to be comprised
of Base Rate Advances.
134
The undersigned hereby certifies that the following
statements are true on the date hereof, and will be true on the
date of the Proposed Borrowing before and after giving effect
thereto:
(a) there exists no Default or Event of Default;
(b) all representations and warranties of Borrower
contained in the Credit Agreement are 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 the Proposed Borrowing (except to the extent such
representations and warranties specifically relate to an
earlier date in which case they shall be true and correct as of
such date);
(c) since the date of the most recent financial
statements of the Consolidated Companies described in Section
5.14 of the Credit Agreement, there has occurred no change
which has had or could reasonably be expected to have a
Materially Adverse Effect (whether or not any notice with
respect to such change has been furnished to the Lenders
pursuant to Section 6.07 of the Credit Agreement);
(d) there is no action or proceeding instituted or
pending before any court or other governmental authority or, to
the knowledge of Borrower, threatened (i) which reasonably
could be expected to have a Materially Adverse Effect, or (ii)
seeking to prohibit or restrict one or more Credit Party's
ownership or operation of any portion of its business or
assets, or to compel one or more Credit Party to dispose of or
hold separate all or any portion of its businesses or assets,
where such portion or portions of such business(es) or assets,
as the case may be, constitute a material portion of the total
businesses or assets of the Consolidated Companies taken as a
whole; and
(e) the Proposed Borrowing and the use of proceeds
thereof shall not contravene, violate or conflict with, or
involve the Agent or any Lender in a violation of, any law,
rule, injunction, or regulation, or determination of any court
of law or other governmental authority applicable to Borrower.
Very truly yours,
▇▇▇▇▇ ENTERPRISES, INC.
By:
----------------------------
Name:
Title:
-2-
135
EXHIBIT C
FORM OF
NOTICE OF CONTINUATION/CONVERSION
SunTrust Bank, Atlanta, as Agent
for the Lenders parties to the
Credit Agreement referenced below
▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
[Date]
Re: ▇▇▇▇▇ ENTERPRISES, INC.
Ladies and Gentlemen:
The undersigned, ▇▇▇▇▇ ENTERPRISES, INC., a Delaware
corporation (the "Borrower"), refers to the Credit Agreement,
dated as of November __, 1995 (the "Credit Agreement"; the terms
defined therein being used herein as therein defined), among the
undersigned, the lenders (the "Lenders") from time to time
parties thereto and SunTrust Bank, Atlanta, as Agent, and hereby
gives you irrevocable notice pursuant to Section 3.01(b) of the
Credit Agreement that the undersigned hereby requests the
[conversion] [continuation] of a Borrowing under the Credit
Agreement as specified below in accordance with Section 3.01(b)
of the Credit Agreement:
[The Borrower hereby requests the conversion of a
Borrowing comprised of Base Rate Advances to a Borrowing
comprised of Eurodollar Advances, as follows:
(i) the Business Day of the proposed conversion is
_________, 19__.
(ii) the amount of the Borrowing is $_________.
(iii) the Interest Period applicable to the
Eurodollar Advances upon such conversion shall
be ____ month(s).]
136
[The Borrower hereby requests the conversion of a
Borrowing comprised of Eurodollar Advances to a Borrowing
comprised of Base Rate Advances, as follows:
(i) the Business Day of the proposed conversion,
which shall be the last day of the current Interest
Period applicable to the Borrowing to be converted, is
_________, 19__.
(ii) the amount of the Borrowing to be converted
is $____________________.]
[The Borrower hereby requests the continuation of
a Borrowing comprised of Eurodollar Advances for an
additional Interest Period, as follows:
(i) the Business Day of the proposed continuation,
which shall be the last day of the current Interest
Period applicable to the Borrowing to be continued, is
_________, 19__.
(ii) the amount of the Borrowing to be continued
is $____________________.
(iii) the Interest Period applicable to the
Eurodollar Advances upon such continuation shall be
____ month(s).]
The undersigned hereby certifies that the following
statement is true on the date hereof, and will be true on the
date of the proposed continuation or conversion:
No Default or Event of Default exists or shall result
from such proposed continuation or conversion.]*
Very truly yours,
▇▇▇▇▇ ENTERPRISES, INC.
By:
---------------------------
Name:
Title:
--------------------
* Applicable only upon the conversion to, or continuation of, a
Borrowing comprised of Eurodollar Advances.
-2-
137
EXHIBIT D
CLOSING CERTIFICATE
The undersigned, being the _____________________ of ▇▇▇▇▇
ENTERPRISES, INC., a Delaware corporation (the "Borrower"),
hereby gives this certificate to induce SUNTRUST BANK, ATLANTA, a
Georgia banking corporation, and each of the other lenders named
on the signature pages to the Credit Agreement defined below
(collectively referred to as the "Lenders"), SunTrust Bank,
Atlanta, as agent for itself and the other Lenders (in such
capacity, the "Agent"), to consummate certain financial
accommodations with the Borrower pursuant to the terms of the
Credit Agreement dated as of even date herewith (the "Credit
Agreement"). Capitalized terms used herein and not defined
herein have the same meanings assigned to them in the Credit
Agreement:
The undersigned hereby certifies to the Agent and the
Lenders that:
1. In his/her aforesaid capacity as the _________________ of
the Borrower, [s]he has knowledge of the business and financial
affairs of the Borrower sufficient to issue this certificate and
is authorized and empowered to issue this certificate for and on
behalf of the Borrower.
2. All representations and warranties contained in the Credit
Agreement are true and correct on and as of the date hereof.
3. After giving effect to the Loans to be made to the Borrower
pursuant to the Credit Agreement on the date hereof, no Default
or Event of Default has occurred and is continuing.
4. Since the date of the audited financial statements of the
Consolidated Companies described in Section 5.14 of the Credit
Agreement, there has been no change which has had or could
reasonably be expected to have a Materially Adverse Effect.
5. Except as may be described on Schedule 5.05 of the Credit
Agreement, no action or proceeding has been instituted or is
pending before any court or other governmental authority, or, to
the knowledge of the Borrower, threatened (i) which reasonably
could be expected to have a Materially Adverse Effect, or (ii)
seeking to prohibit or restrict one or more Credit Party's
ownership or operation of any portion of its businesses or
assets, where such portion or portions of such businesses or
assets, as the case may be, constitute a material portion of the
total businesses or assets of the Consolidated Companies, taken
as a whole.
138
6. The Advances to be made on the date hereof are being used
solely for the purposes provided in the Credit Agreement, and
such Advances and use of proceeds thereof will not contravene,
violate or conflict with, or involve the Agent or any Lender in a
violation of, any law, rule, injunction, or regulation, or
determination of any court of law or other governmental
authority, applicable to the Borrower.
7. Based upon the Agent's representation that the information
provided pursuant to Sections 4.01(k) through (n) is
satisfactory, the conditions precedent set forth in Sections 4.01
and 4.02 of the Credit Agreement have been or will be satisfied
(or have been waived pursuant to the terms of the Credit
Agreement) prior to or concurrently with the making of the
Revolving Loans under the Credit Agreement on the date hereof.
8. The execution, delivery and performance by the Credit
Parties of the Credit Documents will not violate any Requirement
of Law or cause a breach or default under any of their respective
Contractual Obligations.
9. Each of the Credit Parties has the corporate power and
authority to make, deliver and perform the Credit Documents to
which it is a party and has taken all necessary corporate action
to authorize the execution, delivery and performance of such
Credit Documents. No consents or authorization of, or filing
with, any Person (including, without limitation, any governmental
authority), is required in connection with the execution,
delivery or performance by any Credit Party, or the validity or
enforceability against any Credit Party, of the Credit Documents,
other than such consents, authorizations or filings which have
been made or obtained.
IN WITNESS WHEREOF, the undersigned has executed this
certificate solely in his/her aforesaid capacity as of this ____
day of November, 1995.
-----------------------------------
Title:
---------------------------
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139
EXHIBIT E
FORM OF OPINION OF BORROWER'S COUNSEL
November 6, 1995
To: Each of the Lenders party to the
Credit Agreement referenced below
and each assignee thereof that
becomes a "Lender" as provided
therein and SunTrust Bank,
Atlanta, as Agent
Re: Credit Agreement dated as of November 6, 1995, by and among
▇▇▇▇▇ Enterprises, Inc., each of the Lenders listed on the
signature pages thereto and SunTrust Bank, Atlanta, as Agent
thereunder (the "Credit Agreement")
Ladies and Gentlemen:
This opinion is furnished pursuant to Section 4.01 of the Credit
Agreement. Terms used herein which are defined in the Credit Agreement shall
have the respective meanings set forth or referred to in the Credit Agreement,
unless otherwise defined herein.
We have acted as counsel to ▇▇▇▇▇ Enterprises, Inc., a Delaware
corporation (the "Company"), Irving Tanning Company, a Delaware corporation
("Irving") and Kroy Tanning Company, Incorporated, a Delaware corporation
("Kroy"; each of Kroy and Irving may be referred to herein as a "Subsidiary",
and the Company, Irving and Kroy may be collectively referred to herein as the
"Credit Parties"), in connection with the preparation, negotiation, execution
and delivery of the following documents (collectively, the "Credit Documents"):
1. The Credit Agreement;
2. The Revolving Credit Notes;
3. The Note Assignment; and
4. The other instruments, documents, certificates, agreements and
writings executed and delivered by the Credit Parties in
connection with the closing of the Credit Agreement.
In connection with this opinion, we have examined and relied on the
executed originals of the Credit Documents and the following certificates,
instruments and documents relating to the Credit Parties:
▇-▇
▇▇▇
▇. Officer's Certificate of the Chief Financial Officer
of the Company, a copy of which is attached hereto as Exhibit A-1;
2. Officer's Certificate of the Assistant Treasurer of
Irving, a copy of which is attached hereto as Exhibit A-2;
3. Officer's Certificate of the Assistant Treasurer of
Kroy, a copy of which is attached hereto as Exhibit A-3;
4. Certificates of the Secretaries of State or other
appropriate governmental agency of (a) the state of the Company's
incorporation regarding its existence and good standing and (b) the
states listed on Exhibit B attached hereto regarding the Company's
qualification to do business and good standing in those states;
5. Certificates of the Secretaries of State or other
appropriate governmental agency of (a) the respective state of each
Subsidiary's incorporation regarding its existence and good standing
and (b) the states listed on Exhibit B attached hereto regarding such
Subsidiary's qualification to do business and good standing in those
states; and
6. The documents described on Exhibit C attached hereto
(collectively, the "Listed Contractual Obligations").
We have also made such investigations of law and fact as we have
deemed necessary as the basis for the opinions expressed herein.
Whenever our opinion herein with respect to the existence or absence
of facts is indicated to be based on our knowledge or awareness, it is intended
to signify that during the course of our representation of the Credit Parties
as herein described, no information has come to the attention of ▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ which would give us actual knowledge of the
existence or absence of such facts.
We have assumed the genuineness of all signatures (other than those on
behalf of the Credit Parties on the Credit Documents) on, and authenticity of,
all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as copies.
With respect to any element of mutuality which may be required in
order to support the enforceability of the Credit Documents, we have assumed
that the Lenders and the Agent have all requisite power and authority to enter
into and perform their respective obligations under the Credit Agreement and
the other Credit Documents to which they are parties, that the Credit Agreement
and such other Credit Documents have
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141
been duly authorized, executed and delivered by the Lenders and the Agent, and
that the Credit Agreement and such other Credit Documents constitute the legal,
valid and binding obligations of the Lenders and the Agent. Further, to the
extent applicable law requires that the Lenders or Agent act in accordance with
duties of good faith and fair dealing, in a commercially reasonable manner, or
otherwise in compliance with applicable legal requirements (including, without
limitation, federal and state securities laws) in exercising their respective
rights and remedies under the Credit Documents, we have assumed that the
Lenders and Agent will fully comply with such legal requirements,
notwithstanding any provisions of the Credit Documents that purport to grant
the Lenders or Agent the right to act or fail to act in a manner contrary to
such legal requirements, or based on its sole judgment or in its sole
discretion or provisions of similar import.
With respect to the opinions expressed in paragraph 1(c) below
regarding the qualification and good standing of the Credit Parties in certain
jurisdictions, such opinions are based solely upon certificates provided by
agencies of those states described in items 3 and 4 above, copies of which have
been delivered to you at the closing of the Credit Agreement, and such opinions
are limited to the meaning ascribed to such certificates by each applicable
state agency.
Based on the foregoing, and subject to the qualifications and
assumptions contained herein, we are of the opinion that:
1. Each of the Credit Parties (a) is validly existing as a
corporation and in good standing under the laws of its state of incorporation,
(b) has the corporate power and authority to own and operate its properties and
to conduct its business as now conducted and (c) is qualified as a foreign
corporation in, and is in good standing under the laws of, the jurisdictions
set forth on Exhibit B attached hereto, as applicable.
2. Each of the Credit Parties has the corporate power and
authority to make, deliver and perform the Credit Documents to which it is a
party and has taken all necessary corporate action to authorize the execution,
delivery and performance of such Credit Documents.
3. No consent, approval or authorization of, or registration,
declaration or filing with, (i) any United States federal or (ii) any state,
local or other governmental authority of the State of Georgia is required in
connection with the execution, delivery, performance, validity or
enforceability of the Credit Documents or the use of the proceeds of the Loans.
4. The execution, delivery and performance by each of the Credit
Parties of the Credit Documents to which it is a party do not and will not (a)
violate (i) any existing law, rule or regulation of the United States of
America or of the State of Georgia applicable to such Credit Party, (ii) the
certificate or articles of incorporation or by-laws of such Credit Party or
(iii) the terms of any Listed Contractual Obligation nor (b) result in
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the creation of any Lien on the property or assets of any Credit Party pursuant
to the terms of any of the Listed Contractual Obligations.
5. Each of the Credit Parties has duly authorized, executed and
delivered each Credit Document to which it is a party. Each of the Credit
Documents constitutes the legal, valid and binding obligations of each of the
Credit Party that is a party thereto, enforceable against such Credit Party in
accordance with its terms. The provisions of the Credit Documents with respect
to payment of interest, fees, costs, and other charges for the use of money do
not violate the interest and usury laws as in effect in the State of Georgia.
6. None of the Credit Parties is an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, 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.
7. The making of any Revolving Loans and the application of the
proceeds thereof as provided in the Credit Agreement do not violate Regulation
G, T, U or X of the Board of Governors of the Federal Reserve System.
8. To our knowledge, except as reflected in Schedule 5.05 to the
Credit Agreement, there is no litigation or proceeding pending or threatened
against any Credit Party which could have a Material Adverse Effect.
Our opinions set forth above are subject to the following
qualifications:
A. We are licensed to practice law only in the State of Georgia
but are generally familiar with, and have reviewed in connection with this
transaction relevant portions of, the General Business Corporation Law of the
State of Delaware. Accordingly, we express no opinion as to matters of law
other than federal laws of the United States of America, the laws of the State
of Georgia and matters set forth in the published statutes of the General
Corporation Law of the State of Delaware. The opinions expressed in this
opinion letter do not address federal securities laws and regulations
administered by the Securities and Exchange Commission (other than the Public
Utility Holding Company Act of 1935 and the Investment Company Act of 1940),
any state "Blue Sky" laws and regulations, or laws and regulations relating to
commodity (and other) futures and indices and other similar instruments.
B. Enforceability of the Credit Documents is subject to (i)
bankruptcy, insolvency, moratorium, reorganization or similar laws affecting
the enforcement of creditors' rights generally, and (ii) general policies of
equity, regardless of whether enforceability is considered in a proceeding in
equity or at law.
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C. No opinion is expressed with respect to the validity, binding
effect, or enforceability of:
(a) any provision of a Credit Document requiring
indemnification for, or providing exculpation, release, or exemption
from liability for, action or inaction, to the extent such action or
inaction involves negligence or willful misconduct, or to the extent
such indemnification, exculpation, release or exemption from liability
is otherwise contrary to public policy;
(b) any provision of a Credit Document imposing increased
interest rates or late payment charges upon delinquency in payment or
other default or providing for liquidated damages or for premiums on
prepayment, acceleration, or termination, to the extent any such
provisions may be deemed to be penalties or forfeitures;
(c) any provision of a Credit Document that has the
effect of waiving the right to jury trial, statutes of limitation,
marshaling of assets or similar requirements, or consenting or waiving
objections to the jurisdiction of certain courts, or the venue or
forum for judicial actions;
(d) any provision of a Credit Document providing that
waivers or consents by a party may not be given effect unless in
writing or in compliance with particular requirements, or that a
party's course of dealing, course of performance, or the like or
failure or delay in taking action may not constitute a waiver of
related rights or provisions, or that one or more waivers may not
under certain circumstances constitute a waiver of other matters of
the same kind;
(e) any provision of a Credit Document providing that a
party has the right to pursue multiple remedies without regard to
other remedies elected or that all remedies are cumulative;
(f) any provision of a Credit Document purporting to
require payment by any Credit Party of any Lender's or the Agent's
attorneys' fees without compliance with the applicable requirements of
O.C.G.A. Section 13-1-11;
(g) any provision of a Credit Document providing that
modifications to such document may only be made in writing or that the
provisions of such document are severable;
(h) any provision of a Credit Document purporting to
permit the exercise, under certain circumstances, of rights or
remedies without notice or without providing opportunity to cure
failures to perform;
(i) any provision of a Credit Document purporting to
grant rights of setoff otherwise than in accordance with applicable
law; and
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(j) any provision of a Credit Document purporting to
require a waiver of defenses, setoffs, or counterclaims against the
Lenders or Agent.
D. We note that certain waivers of notices and other rights and
remedial provisions contained in the Credit Documents may be unenforceable
under applicable law, but the Credit Documents contain adequate other
provisions for enforcing payment of the obligations evidenced, guaranteed or
secured thereby and for the practical realization of the rights and remedies
afforded thereby, and the inclusion of such waivers, rights and remedial
provisions in the Credit Documents does not affect the legality, validity or
binding effect of such Credit Documents or affect the enforceability of the
other provisions of the Credit Documents.
E. Our knowledge of the business and affairs of each of the
Credit Parties and of the implications thereof on the applicability of any laws
to them is based solely on the officer's certificates attached hereto.
F. For purposes of the opinions expressed in paragraph 5 above,
we have assumed that the interest and other fees and charges, whether or not
denominated as "interest," which may be received by the Agent and the Lenders
in respect of the Loans and the other financial accommodations to be made under
the Credit Documents and the interest and other fees and charges which are
actually received by the Agent and the Lenders in respect of such loans and
financial accommodations will not exceed five percent (5%) per month of the
amount of such loans and financial accommodations. Further, we express no
opinion as to the enforceability of any provision of the Credit Documents which
purports to charge interest on unpaid interest.
This opinion has been delivered solely for the benefit of the Lenders,
the Agent, their respective counsel and successors and permitted assigns, and
may not be relied upon by any other person or entity or for any other purpose
without the express written permission of the undersigned.
Very truly yours,
▇▇▇▇▇▇ & BIRD
By:
---------------------------
A Partner
▇-▇
▇▇▇
▇▇▇▇▇▇▇ ▇-▇
OFFICER'S CERTIFICATE
I, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Vice President_Finance, Treasurer and Chief
Financial Officer of ▇▇▇▇▇ Enterprises, Inc., a Delaware corporation (the
"Company"), hereby acknowledge and agree that ▇▇▇▇▇▇ & Bird may rely and will
be relying on this Certificate in rendering their opinion (the "Opinion") in
connection with the transactions contemplated by that certain Credit Agreement
dated as of the date hereof (the "Credit Agreement") by and among the Company,
the lenders from time to time party thereto (the "Lenders") and SunTrust Bank,
Atlanta, as agent (the "Agent"). Capitalized terms used herein and not
otherwise defined herein have the respective meanings given them in, or by
reference in, the Opinion.
I hereby certify to ▇▇▇▇▇▇ & Bird that, to the best of my knowledge:
1. A copy of the Opinion has been provided to the undersigned in
connection with the certifications made herein. Further, the undersigned is
familiar with each of the Credit Documents.
2. ▇▇▇▇▇▇ & Bird may rely on all certificates from the Company or
state officials provided to the Agent or any Lender in connection with the
Credit Agreement as if the same were addressed to ▇▇▇▇▇▇ & Bird. The
certificate of incorporation and bylaws of the Company have not been amended,
revoked or otherwise changed since the date of certification by the Secretary
of State of the State of Delaware of the copy of such certificate delivered to
the Agent under the Credit Agreement. The Company is current in its net worth
and income tax payments and filings to the Georgia Department of Revenue.
3. The resolutions of the Board of Directors and the Executive
Committee of the Board of Directors of the Company reviewed and relied upon by
▇▇▇▇▇▇ & Bird are true, complete and correct, the resolutions have not been
amended or revoked since the date adopted and are the only resolutions relating
to the matters that are the subject matter of the Opinion. Further, the
Company's relevant corporate resolutions were adopted in compliance with any
procedural requirements of the Company's certificate of incorporation and
bylaws and the Delaware Corporation Laws.
4. The Company currently is engaged in the businesses described
in Item 1 of the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994 (the "Annual Report"), which description is incorporated
herein. Additionally, since that time the Company has agreed to (i) sell
American Southern Insurance Company and its subsidiaries and (ii) acquire Basic
American Medical Products, Inc., and has publicly expressed its intent to enter
the health and safety products manufacturing field.
5. The Company has not received any notice from the Secretary of
State of the State of Delaware of a determination that any grounds exist for
administratively
146
dissolving the Company and the Company has not received notice of the
commencement of any action to judicially dissolve the Company. Neither the
Board of Directors nor the shareholders of the Company have taken any action
with respect to the dissolution of the Company, and the Company has not filed
any notice of intent to dissolve with the State of Delaware.
6. The Company owns or leases places of business in only the
States of Georgia and New York.
7. All directors signing the Company's consent resolution
authorizing the transactions contemplated by the Credit Agreement were duly
appointed and incumbent in their offices at the time of all relevant corporate
action and at all relevant times thereafter.
8. Except as set forth on Exhibit C to the Opinion, the Company
is not a party to or bound by any contract, agreement, indenture, lease or
other document the violation or termination of which could have a Materially
Adverse Effect.
9. Other than the Securities and Exchange Commission and the New
York Stock Exchange and except as discussed in Item 1. of the Annual Report,
the Company does not regularly deal with or report to any federal or state
governmental agency or authority.
10. Except as set forth on Schedule 5.05 to the Credit Agreement,
there is no litigation or proceeding pending or threatened against the Company
or any of its properties, which could have a Materially Adverse Effect or any
outstanding judicial or administrative decree, writ, judgment or order to which
the Company or any of its properties is subject which has had or could have a
Materially Adverse Effect.
11. The Company is not engaged principally, or as one of its
important activities, in the business of purchasing or carrying "margin stock"
(as defined below), and no part of the proceeds of any Loans to the Company or
any Intercompany Loans to any other Consolidated Company will be used to
purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock. For purposes of this
certificate, the term "margin stock" shall mean (i) any equity security
registered or having unlisted trading privileges on a national securities
exchange; (ii) any OTC margin stock; (iii) any OTC security designated as
qualified for trading in the National Market System; (iv) any debt security
convertible into or carrying a subscription right to purchase a margin stock;
(v) any warrant or right to subscribe to or purchase a margin stock; or (vi)
any security issued by an investment company registered under Section 8 of the
Investment Company Act of 1940 other than (a) a company licensed under the
Small Business Investment Act of 1958, as amended; or (b) a company which has
at least 95 percent of its assets continuously invested in government or
municipal securities; or (c) a company which issues face-amount certificates.
12. The Company is not, nor does it hold itself out as being
primarily, nor does it propose to engage primarily, in the business of
investing, reinvesting, or trading in
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147
securities. The Company is not engaged nor does it propose to engage in the
business of issuing face-amount certificates of the installment type, nor has
the Company been engaged in such business nor does it have any such certificate
outstanding. The Company is not engaged nor does it propose to engage in the
business of investing, reinvesting, owning, holding or trading in securities,
and it neither owns nor does it propose to acquire investment securities having
a value exceeding 40% of the value of the Company's total assets (exclusive of
government securities and cash items) on an unconsolidated basis. The Company
is not controlled by an entity that satisfies any of the foregoing criteria.
13. The Company does not, directly or indirectly, own, control or
hold, with the power to vote ten percent or more of the outstanding voting
securities of (i) any company which owns or operates facilities used for the
generation, transmission, or distribution of electric energy for sale, or any
company which owns or operates facilities used for the distribution at retail
of natural or manufactured gas for heat, light, or power (any such company
shall be referred to herein as a "Public Utility"), or (ii) any company which
directly or indirectly owns, controls or holds with power to vote, the voting
securities of any Public Utility, or (iii) any company whose voting securities
are directly or indirectly owned, controlled or held with power to vote, by any
company which directly or indirectly owns, controls or holds with power to
vote, the voting securities of any Public Utility. The Company has not
received notification from the Securities and Exchange Commission that,
pursuant to the Public Utility Holding Company Act of 1935, the Commission has
determined that (i) the Company, or (ii) any person the Company directly or
indirectly owns, controls or holds with power to vote, the voting securities
of, or (iii) any person which directly or indirectly owns, controls or holds
with power to vote, the voting securities of the Company, constitutes a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary" of a "holding company."
14. The undersigned is not aware of any consent, approval or
authorization of, or registration, declaration or filing with, (i) any United
States federal or (ii) any state, local, or other governmental authority of the
State of Georgia, required in connection with the execution, delivery,
performance, validity or enforceability of the Credit Documents or the use of
the proceeds of the Loans.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate as of November 6, 1995.
By:
--------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Vice President-Finance, Treasurer and Chief
Financial Officer of ▇▇▇▇▇ Enterprises, Inc.
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148
EXHIBIT A-2
OFFICER'S CERTIFICATE
I, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Assistant Treasurer of Irving Tanning
Company, a Delaware corporation (the "Company"), hereby acknowledge and agree
that ▇▇▇▇▇▇ & Bird may rely and will be relying on this Certificate in
rendering their opinion (the "Opinion") in connection with the transactions
contemplated by that certain Credit Agreement dated as of the date hereof (the
"Credit Agreement") by and among the Company, the lenders from time to time
party thereto (the "Lenders") and SunTrust Bank, Atlanta, as agent (the
"Agent"). Capitalized terms used herein and not otherwise defined herein have
the respective meanings given them in, or by reference in, the Opinion.
I hereby certify to ▇▇▇▇▇▇ & Bird that, to the best of my knowledge:
1. A copy of the Opinion has been provided to the undersigned in
connection with the certifications made herein. Further, the undersigned is
familiar with each of the Credit Documents.
2. ▇▇▇▇▇▇ & Bird may rely on all certificates from the Company or
state officials provided to the Agent or any Lender in connection with the
Credit Agreement as if the same were addressed to ▇▇▇▇▇▇ & Bird. The
certificate of incorporation and bylaws of the Company have not been amended,
revoked or otherwise changed since the date of certification by the Secretary
of State of the State of Delaware of the copy of such certificate delivered to
the Agent under the Credit Agreement.
3. The resolutions of the Board of Directors of the Company
reviewed and relied upon by ▇▇▇▇▇▇ & Bird are true, complete and correct, the
resolutions have not been amended or revoked since the date adopted and are the
only resolutions relating to the matters that are the subject matter of the
Opinion. Further, the Company's relevant corporate resolutions were adopted in
compliance with any procedural requirements of the Company's certificate of
incorporation and bylaws and the Delaware Corporation Laws.
4. The Company is engaged in the business of producing leather
and finished leather from cowhide for a variety of consumer goods as more
particularly described in Item 1. of ▇▇▇▇▇ Enterprises, Inc. Annual Report on
Form 10- K filed March 22, 1995 with the Securities and Exchange Commission
(the "Annual Report"), which description is incorporated herein.
5. The Company has not received any notice from the Secretary of
State of the State of Delaware of a determination that any grounds exist for
administratively dissolving the Company and the Company has not received notice
of the commencement of any action to judicially dissolve the Company. Neither
the board of directors nor the shareholders of the Company have taken any
action with respect to the dissolution of the
149
Company, and the Company has not filed any notice of intent to dissolve with
the State of Delaware.
6. The Company owns or leases places of business in Hong Kong and
the States of Maine and New York.
7. All directors signing the Company's consent resolution
authorizing the transactions contemplated by that certain Credit Agreement were
duly appointed and incumbent in their offices at the time of all relevant
corporate action and at all relevant times thereafter.
8. Except as set forth on Exhibit C, the Company is not a party
to or bound by any contract, agreement, indenture, lease or other document the
violation or termination of which could have a Materially Adverse Effect.
9. Other than the Securities and Exchange Commission and various
state securities authorities and except as discussed in Item 1. of the Annual
Report, the Company does not regularly deal with or report to any federal or
state governmental agency or authority.
10. Except as set forth on Schedule 5.05 to the Credit Agreement,
there is no litigation or proceeding pending or threatened against the Company
or any of its properties, which could have a Material Adverse Effect or any
outstanding judicial or administrative decree, writ, judgment or order to which
the Company or its properties is subject which has had or could have a
Materially Adverse Effect.
11. The Company is not engaged principally, or as one of its
important activities, in the business of purchasing or carrying "margin stock"
(as defined below), and no part of the proceeds of any Loans to the Company or
any Intercompany Loans to any other Consolidated Company will be used to
purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock. For purposes of this
certificate, the term "margin stock" shall mean (i) any equity security
registered or having unlisted trading privileges on a national securities
exchange; (ii) any OTC margin stock; (iii) any OTC security designated as
qualified for trading in the National Market System; (iv) any debt security
convertible into or carrying a subscription right to purchase a margin stock;
(v) any warrant or right to subscribe to or purchase a margin stock; or (vi)
any security issued by an investment company registered under Section 8 of the
Investment Company Act of 1940 other than (a) a company licensed under the
Small Business Investment Act of 1958, as amended; or (b) a company which has
at least 95 percent of its assets continuously invested in government or
municipal securities; or (c) a company which issues face-amount certificates.
12. The Company is not, nor does it hold itself out as being
primarily, nor does it propose to engage primarily, in the business of
investing, reinvesting, or trading securities. The Company is not engaged nor
does it propose to engage in the business of
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150
issuing face-amount certificates of the installment type, nor has the Company
been engaged in such business nor does it have any such certificate
outstanding. The Company is not engaged nor does it propose to engage in the
business of investing, reinvesting, owning, holding or trading in securities,
and it neither owns nor does it propose to acquire investment securities having
a value exceeding 40% of the value of the Company's total assets (exclusive of
government securities and cash items) on an unconsolidated basis.
13. The Company does not, directly or indirectly, own, control, or
hold, with the power to vote ten percent or more of the outstanding voting
securities of (i) any company which owns or operates facilities used for the
generation, transmission, or distribution of electric energy for sale, or any
company which owns or operates facilities used for the distribution at retail
of natural or manufactured gas for heat, light, or power (any such company
shall be referred to herein as a "Public Utility"), or (ii) any company which
directly or indirectly owns, controls or holds with power to vote, the voting
securities of any Public Utility, or (iii) any company whose voting securities
are directly or indirectly owned, controlled or held with power to vote, by any
company which directly or indirectly owns, controls or holds with power to
vote, the voting securities of any Public Utility. The Company has not
received notification from the Securities and Exchange Commission that,
pursuant to the Public Utility Holding Company Act of 1935, the Commission has
determined that (i) the Company, or (ii) any person the Company directly or
indirectly owns, controls or holds with power to vote, the voting securities
of, or (iii) any person which directly or indirectly owns, controls or holds
with power to vote, the voting securities of the Company, constitutes a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary" of a "holding company."
14. The undersigned is not aware of any consent, approval or
authorization of, or registration, declaration or filing with, (i) any United
States federal or (ii) any state, local, or other governmental authority of the
State of Georgia, required in connection with the execution, delivery,
performance, validity or enforceability of the Credit Documents or the use of
the proceeds of the Loans.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate as of November 6, 1995.
By:
---------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Assistant Treasurer
Irving Tanning Company
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EXHIBIT A-3
OFFICER'S CERTIFICATE
I, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Assistant Treasurer of Kroy Tanning
Company, Incorporated, a Delaware corporation (the "Company"), hereby
acknowledge and agree that ▇▇▇▇▇▇ & Bird may rely and will be relying on this
Certificate in rendering their opinion (the "Opinion") in connection with the
transactions contemplated by that certain Credit Agreement dated as of the date
hereof (the "Credit Agreement") by and among the Company, the lenders from time
to time party thereto (the "Lenders") and SunTrust Bank, Atlanta, as agent (the
"Agent"). Capitalized terms used herein and not otherwise defined herein have
the respective meanings given them in, or by reference in, the Opinion.
I hereby certify to ▇▇▇▇▇▇ & Bird that, to the best of my knowledge:
1. A copy of the Opinion has been provided to the undersigned in
connection with the certifications made herein. Further, the undersigned is
familiar with each of the Credit Documents.
2. ▇▇▇▇▇▇ & Bird may rely on all certificates from the Company or
state officials provided to the Agent or any Lender in connection with the
Credit Agreement as if the same were addressed to ▇▇▇▇▇▇ & Bird. The
certificate of incorporation and bylaws of the Company have not been amended,
revoked or otherwise changed since the date of certification by the Secretary
of State of the State of Delaware of the copy of such certificate delivered to
the Agent under the Credit Agreement.
3. The resolutions of the Board of Directors of the Company
reviewed and relied upon by ▇▇▇▇▇▇ & Bird are true, complete and correct, the
resolutions have not been amended or revoked since the date adopted and are the
only resolutions relating to the matters that are the subject matter of the
Opinion. Further, the Company's relevant corporate resolutions were adopted in
compliance with any procedural requirements of the Company's certificate of
incorporation and bylaws and the Delaware Corporation Laws.
4. The Company is engaged in the business of producing leather
and finished leather from deerskin and lambskin for a variety of consumer goods
as more particularly described in Item 1. of ▇▇▇▇▇ Enterprises, Inc. Annual
Report on Form 10-K filed March 22, 1995 with the Securities and Exchange
Commission (the "Annual Report"), which description is incorporated herein.
5. The Company has not received any notice from the Secretary of
State of the State of Delaware of a determination that any grounds exist for
administratively dissolving the Company and the Company has not received notice
of the commencement of any action to judicially dissolve the Company. Neither
the board of directors nor the shareholders of the Company have taken any
action with respect to the dissolution of the
152
Company, and the Company has not filed any notice of intent to dissolve with
the State of Delaware.
6. The Company owns or leases places of business in only the
State of Maine.
7. All directors signing the Company's consent resolution
authorizing the transactions contemplated by that certain Credit Agreement were
duly appointed and incumbent in their offices at the time of all relevant
corporate action and at all relevant times thereafter.
8. Except as set forth on Exhibit C to the Opinion, the Company
is not a party to or bound by any contract, agreement, indenture, lease or
other document the violation or termination of which could have a Materially
Adverse Effect.
9. Other than the Securities and Exchange Commission and various
state securities authorities and except as discussed in Item 1. of the Annual
Report, the Company does not regularly deal with or report to any federal or
state governmental agency or authority.
10. Except as set forth on Schedule 5.05 to the Credit Agreement,
there is no litigation or proceeding pending or threatened against the Company
or any of its properties, which could have a Materially Adverse Effect or any
outstanding judicial or administrative decree, writ, judgment or order to which
the Company or its properties are subject which has had or could have a
Materially Adverse Effect.
11. The Company is not engaged principally, or as one of its
important activities, in the business of purchasing or carrying "margin stock"
(as defined below), and no part of the proceeds of any Loans to the Company or
any Intercompany Loans to any other Consolidated Company will be used to
purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock. For purposes of this
certificate, the term "margin stock" shall mean (i) any equity security
registered or having unlisted trading privileges on a national securities
exchange; (ii) any OTC margin stock; (iii) any OTC security designated as
qualified for trading in the National Market System; (iv) any debt security
convertible into or carrying a subscription right to purchase a margin stock;
(v) any warrant or right to subscribe to or purchase a margin stock; or (vi)
any security issued by an investment company registered under Section 8 of the
Investment Company Act of 1940 other than (a) a company licensed under the
Small Business Investment Act of 1958, as amended; or (b) a company which has
at least 95 percent of its assets continuously invested in government or
municipal securities; or (c) a company which issues face-amount certificates.
12. The Company is not, nor does it hold itself out as being
primarily, nor does it propose to engage primarily, in the business of
investing, reinvesting, or trading securities. The Company is not engaged nor
does it propose to engage in the business of issuing face-amount certificates
of the installment type, nor has the Company been
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153
engaged in such business nor does it have any such certificate outstanding.
The Company is not engaged nor does it propose to engage in the business of
investing, reinvesting, owning, holding or trading in securities, and it
neither owns nor does it propose to acquire investment securities having a
value exceeding 40% of the value of the Company's total assets (exclusive of
government securities and cash items) on an unconsolidated basis.
13. The Company does not, directly or indirectly, own, control, or
hold, with the power to vote ten percent or more of the outstanding voting
securities of (i) any company which owns or operates facilities used for the
generation, transmission, or distribution of electric energy for sale, or any
company which owns or operates facilities used for the distribution at retail
of natural or manufactured gas for heat, light, or power (any such company
shall be referred to herein as a "Public Utility"), or (ii) any company which
directly or indirectly owns, controls or holds with power to vote, the voting
securities of any Public Utility, or (iii) any company whose voting securities
are directly or indirectly owned, controlled or held with power to vote, by any
company which directly or indirectly owns, controls or holds with power to
vote, the voting securities of any Public Utility. The Company has not
received notification from the Securities and Exchange Commission that,
pursuant to the Public Utility Holding Company Act of 1935, the Commission has
determined that (i) the Company, or (ii) any person the Company directly or
indirectly owns, controls or holds with power to vote, the voting securities
of, or (iii) any person which directly or indirectly owns, controls or holds
with power to vote, the voting securities of the Company, constitutes a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary" of a "holding company."
14. The undersigned is not aware of any consent, approval or
authorization of, or registration, declaration or filing with, (i) any United
States federal or (ii) any state, local, or other governmental authority of the
State of Georgia, required in connection with the execution, delivery,
performance, validity or enforceability of the Credit Documents or the use of
the proceeds of the Loans.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate as of November 6, 1995.
By:
-------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Assistant Treasurer
Kroy Tanning Company, Incorporated
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EXHIBIT B
Jurisdictions of Qualification
Company
Delaware
Georgia
Maine
New York
Irving
Delaware
Maine
New York
Kroy
Delaware
Maine
Massachusetts
155
EXHIBIT C
Listed Contractual Obligations
1. Agreement between Town of Hartland, Maine and Irving Tanning Company
dated September 26, 1994 related to General Obligation Bonds.
2. Management Agreement between Vista and ▇▇▇▇▇ National Corporation
dated April 10, 1989.
3. Assignment to ▇▇▇▇▇ Capital Corporation of the Management Agreement
between Vista and ▇▇▇▇▇ National Corporation.
4. First Amendment to Management Agreement between ▇▇▇▇▇ Capital
Corporation and Vista dated September 14, 1994.
5. Lease Agreement between Vista (Leasee) and Sumitomo Life Realty (N.Y.)
Inc. (Lessor) dated January 17, 1990.
6. First Amendment to the Lease Agreement between Vista (Lessee) and
Sumitomo Life Realty (N.Y.) Inc. dated September 6, 1990.
7. Second Amendment to the Lease Agreement between Vista (Lessee) and
Sumitomo Life Realty (N.Y.) Inc. dated February 21, 1992.
8. Third Amendment to the Lease Agreement between Vista (Lessee) and
Sumitomo Life Realty (N.Y.) Inc. dated October 28, 1994.
9. Sublease Agreement between Vista and ▇▇▇▇▇ Capital Corporation dated
October 31, 1994.
10. Lease Agreement between American Southern (Leasee) and Northcreek
Associates (Lessor) dated July 10, 1989.
11. First Amendment to the Lease Agreement between American Southern
(Leasee) and Northcreek Associates (Lessor) dated April 23, 1990.
12. Lease Agreement between Empire State Building Company (Lessor) and
Vista (Lessee) dated March 1, 1993 along with Lease Modification
Agreement and Space Deletion Agreement dated February 18, 1994.
13. Consulting Agreement between American Southern Insurance Company and
The Seibels ▇▇▇▇▇ Group, Inc. dated May 17, 1995.
156
14. International Sales Representative Agreement between Irving Tanning
Company, Inc. and Fineco Leather Ltd. dated June 1, 1995.
15. Agreement between IBP, Inc. and Irving Tanning Company, Inc. dated
June 10, 1994.
16. Stock Purchase Agreement among Vista, Concorde Finance & Investment,
Inc., InterRedec, Inc., InterRedec Southern Company, Inc. and American
Southern Company dated September 17, 1991.
17. Non-negotiable Promissory Note between Vista and InterRedec Southern
Company, Inc. dated October 11, 1991.
18. Stock Pledge and Security Agreement between Vista and InterRedec
Southern Company, Inc. dated October 11, 1991.
19. Escrow Agreement among Vista, InterRedec Southern Company, Inc. and
First Union National Bank of Georgia dated October 11, 1991.
20. Agreement and Plan of Merger among Basic American Medical Products,
Inc., BA Acquisition Corporation and ▇▇▇▇▇ Enterprises, Inc. dated
October 6, 1995.
21. Stock Purchase Agreement between Atlantic American Corporation and
▇▇▇▇▇ Enterprises, Inc. dated October 16, 1995.
157
EXHIBIT F
FORM OF
COMPLIANCE CERTIFICATE
SunTrust Bank, Atlanta, as Agent
and each of the Lenders party
to the Credit Agreement referenced
below
Re: ▇▇▇▇▇ Enterprises, Inc.
Gentlemen:
The undersigned, ______________________, being the chief financial
officer of ▇▇▇▇▇ Enterprises, Inc., a Delaware corporation (the "Borrower"),
hereby delivers this Compliance Certificate to the Agent and Lenders as
required by the terms of that certain Credit Agreement dated as of November
___, 1995 by and among SunTrust Bank, Atlanta, individually and as Agent, the
Borrower and the Lenders party thereto (the "Credit Agreement"). All terms
used herein without definition shall have the meaning set forth in the Credit
Agreement.
1. The undersigned is duly authorized to execute and deliver this
certificate on behalf of the Borrower in his or her capacity as the chief
financial officer of the Borrower.
2. The calculations set forth in Attachment 1 hereto are true and
accurate computations of the financial covenants and the other provisions
identified on such Attachment in accordance with the terms of the Credit
Agreement.
[Add for quarterly reports: 3. The consolidated financial statements
of the Consolidated Companies attached hereto for the fiscal quarter ending
____________________ fairly present in all material respects the financial
condition of the Consolidated Companies as at the end of such fiscal quarter on
a consolidated basis, and the results of operations and statements of cash
flows of the Consolidated Companies for such fiscal quarter and such portion of
Borrower's fiscal year, in accordance with GAAP consistently applied (subject
to normal year-end audit adjustments and the absence of certain footnotes).]
4. Based upon a review of the activities of Consolidated
Companies and the financial statements attached hereto during the period
covered thereby, there exists no Event of Default or Default under the Credit
Agreement.
--------------------------------------
Name:
Title:
158
Attachment No. 1 to Compliance Certificate
The Compliance Certificate attached hereto is as of
___________________________ and pertains to the period from
___________________________ to __________________________.
1. Debt to Capital Ratio - Calculated Quarterly
a. Funded Debt (including the current portion
thereof) of the Consolidated Companies
--------------
b. Funded Debt of Other Persons Guaranteed
by a Consolidated Company
--------------
c. Required Stock Redemptions in next
12 months
--------------
d. Debt outstanding pursuant to
SunTrust Line of Credit
--------------
e. Adjusted Funded Debt (a+b+c+d)
--------------
f. Net Worth of Borrower less
Treasury Stock
--------------
g. Total Capitalization (e+f)
--------------
h. Leverage Ratio e/g %
--------------
i. Maximum Leverage Ratio .6:1:00
--------------
j. Default Indicated? Yes/No
2. Interest Coverage Ratio - Calculated Quarterly
For Preceding Four Quarters
a. Consolidated EBIT
--------------
b. Consolidated Interest Expense
--------------
c. Ratio of (a)/(b)
--------------
d. Minimum Ratio 2.0:1.0
--------------
e. Default Indicated? Yes/No
3. Cash Flow Coverage Ratio - Calculated Quarterly
For Preceding Four Quarters
a. Consolidated Net Income (Loss)
--------------
b. Depreciation and Amortization
--------------
c. Consolidated EBITDA (a+b)
--------------
d. Consolidated Funded Debt
--------------
e. Ratio of (c)/(d)
--------------
f. Minimum Ratio 3.5:1.0
--------------
g. Default Indicated? Yes/No
159
4. Indebtedness (Section 7.01)
List all outstanding Indebtedness incurred since later of Closing Date
or date of last Compliance Certificate and indicate provision of Credit
Agreement permitting the same:
_____________________________________________________
_____________________________________________________
_____________________________________________________
5. Liens (Section 7.02)
a. Amount of Indebtedness permitted
by Section 7.01(d) Secured by Liens $
-------------
b. Amount Permitted $5,000,000.00
c. Default Indicated? Yes/No
6. Dividends (Section 7.04)
Total Amount of all repurchases of
capital stock during current fiscal
year $
-------------
Amount Permitted: $1,000,000
-------------
Default Indicated? Yes/No
7. Stock Ownership
Amount of Shares of Voting Stock
owned by ▇▇▇▇▇ Family as of date hereof
-------------
Amount Required 720,000
-------------
Default Indicated? Yes/No
8. Intercompany Loans
As listed below:
Note Delivered
Obligor Obligee Amount Outstanding Pursuant to Assignment?
------- ------- ------------------ -----------------------
Yes/No
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160
EXHIBIT G
ASSIGNMENT AND ACCEPTANCE AGREEMENT
ASSIGNMENT AND ACCEPTANCE AGREEMENT (the "Assignment
Agreement") dated as of _____________, 19__ between
______________________________________________ ("Assignor") and
__________________________________ ("Assignee"). All capitalized terms used
herein and not otherwise defined shall have the respective meanings provided
such terms in the Credit Agreement referred to below.
W I T N E S S E T H:
WHEREAS, Assignor is a party to a Credit Agreement, dated as
of November 6, 1995 (as amended to the date hereof, the "Credit Agreement"),
among ▇▇▇▇▇ Enterprises, Inc., a Delaware corporation (the "Borrower"), various
financial institutions (including Assignor, the "Lenders") and SunTrust Bank,
Atlanta, as Agent (the "Agent"); and
WHEREAS, Assignor has a Revolving Credit Commitment of
$___________ under the Credit Agreement pursuant to which it has made
outstanding Advances of $______________ and Letter of Credit Obligations of
$_________________; and
WHEREAS, Assignor and Assignee wish Assignor to assign to
Assignee its rights under the Credit Agreement with respect to a portion of its
Revolving Credit and of its outstanding Advances and Letter of Credit
Obligations; and
WHEREAS, Assignor and Assignee wish Assignee to assume the
obligations of Assignor under the Credit Agreement to the extent of the rights
so assigned;
NOW THEREFORE, in consideration of the mutual agreements
herein contained, the parties hereto agree as follows:
1. Assignment. Assignor hereby assigns to Assignee,
without recourse, or representation or warranty (other than expressly provided
herein) and subject to Section 4(b) hereof, ___% as the "Assignee's Share"
("Assignee's Share") of all of Assignor's rights, title and interest arising
under the Credit Agreement relating to Assignor's Revolving Credit Commitment,
including with respect to Assignee's Share of the Advances and Letter of Credit
Obligations heretofore made by the Assignor under the Revolving Credit
Commitment pursuant to the Credit Agreement. The dollar amount of Assignee's
Share of Assignor's Revolving Credit Commitment is $__________, the dollar
amount of Assignee's Share of Assignor's outstanding Advances under the
Revolving Credit Commitments is $__________ and the dollar amount of Assignee's
Share of Assignor's outstanding Letter of Credit Obligations is
$_________________________.
161
2. Assumption. Assignee hereby assumes from Assignor
all of Assignor's obligations arising under the Credit Agreement relating to
Assignee's Share of Assignor's Revolving Credit Commitment and of the Advances
and Letter of Credit Obligations outstanding thereunder. It is the intent of
the parties hereto that Assignor shall be released from all of its obligations
under the Credit Agreement relating to Assignee's Share.
3. Assignments; Participations. Assignee may not assign
all or any part of the rights granted to it hereunder. Assignee may sell or
grant participations in all or any part of the rights granted to it hereunder
in accordance with the provisions of Section 10.06 of the Credit Agreement.
4. Payment of Interest and Fees to Assignee.
(a) As of the date hereof interest is payable by the
Borrower in respect of Assignee's Share of the Eurodollar Advances at a rate
equal to ___% per annum above LIBOR and a Commitment Fee equal to ___% per
annum and a Letter of Credit Fee equal to ____% per annum on the Assignee's
Share of the average daily unused portion of the Revolving Credit Commitment
and the Letter of Credit Obligations, respectively.
(b) Notwithstanding anything to the contrary
contained in this Assignment Agreement, if and when Assignor receives or
collects any payment of interest on any Advance attributable to Assignee's
Share or any payment of the Commitment Fee or Letter of Credit Fee attributable
to Assignee's Share which, in any such case, are required to be paid to
Assignee pursuant to clause (a) above, Assignor shall distribute to Assignee
such payment but only to the extent such interest or fee accrued after the
Assignment Effective Date (as hereinafter defined).
(c) Notwithstanding anything to the contrary
contained in this Assignment Agreement, if and when Assignee receives or
collects any payment of interest on any Advance or any payment of the
Commitment Fee or Letter of Credit Fee which, in any such case, is required to
be paid to Assignor pursuant to clause (a) above, Assignee shall distribute to
Assignor such payment.
5. Payments on Assignment Effective Date. In
consideration of the assignment by Assignor to Assignee of Assignee's Share of
Assignor's Revolving Credit Commitment, Advances and Letter of Credit
Obligations as set forth above, Assignee agrees to pay to Assignor on or prior
to the Assignment Effective Date an amount specified by Assignor in writing on
or prior to the Assignment Effective Date which represents Assignee's Share of
the principal amount of the respective Advances made by Assignor pursuant to
the Revolving Credit Commitment and outstanding on the Assignment Effective
Date.
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162
6. Effectiveness. (a) This Assignment Agreement shall
become effective on the date (the "Assignment Effective Date") (which is at
least five days after the date hereof) on which (i) Assignor and Assignee shall
have signed a copy hereof (whether the same or different copies) and, in the
case of Assignee, shall have delivered same to Assignor, (ii) the Borrower
shall have consented hereto, (iii) a copy of the fully executed Assignment, a
fee of $3,000 and the Notes evidencing the Revolving Credit Commitment assigned
hereby shall have been delivered to the Agent, and (iv) Assignee shall have
paid to Assignor the amount set forth in Section 5.
(b) It is agreed that all interest on any Advance
attributable to Assignee's Share and all Commitment Fees and Letter of Credit
Fees attributable to Assignee's Share, which, in each case, accrues on and
after the Assignment Effective Date shall be paid directly to the Assignee in
accordance with the terms of the Credit Agreement.
7. Amendment of Credit Agreement. On the Assignment
Effective Date the Credit Agreement shall be amended by deeming the signature
of Assignee herein as a signature to the Credit Agreement. The Assignee shall
be deemed a "Lender" for all purposes under the Credit Agreement and shall be
subject to and shall benefit from all of the rights and obligations of a Lender
under the Credit Agreement. The address of the Assignee for notice purposes
shall be as set forth below, and the Credit Agreement shall be amended by
deeming such signature page and address to be included thereon. Without
limiting the generality of the foregoing, Assignee agrees that it will perform
its obligations as a Lender under the Credit Agreement as required by the terms
thereof and Assignee appoints and authorizes the Agent to take such actions as
Agent on its behalf and exercise such powers under the Credit Agreement and the
other loan documents as are delegated to the Agent by the terms of the Credit
Agreement and the other credit documents, together with such powers as are
reasonably incidental thereto.
8. Representations and Warranties. Each of the Assignor
and the Assignee represents and warrants to the other party as follows:
(a) it has full power and authority, and has
taken all action necessary, to execute and deliver this Assignment Agreement
and to fulfill its obligations under, and to consummate the transactions
contemplated by, this Assignment Agreement;
(b) the making and performance by it of this
Assignment Agreement and all documents required to be executed and delivered by
it hereunder do not and will not violate any law or regulation of the
jurisdiction of its incorporation or any other law or regulation applicable to
it;
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163
(c) this Assignment Agreement has been duly
executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms; and
(d) all consents, licenses, approvals,
authorizations, exemptions, registrations, filings, opinions and declarations
from or with any agency, department, administrative authority, statutory
corporation or judicial entity necessary for the validity or enforceability of
its obligations under this Assignment Agreement have been obtained, and no
governmental authorizations other than any already obtained are required in
connection with its execution, delivery and performance of this Assignment
Agreement.
9. Expenses. The Assignor and the Assignee agree that
each party shall bear its own expenses in connection with the preparation and
execution of this Assignment Agreement.
10. Miscellaneous. (a) Assignor shall not be responsible
to Assignee for the execution (by any party other than the Assignor),
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of the Credit Agreement, the Notes or the Note Assignments or for
any representations, warranties, recitals or statements made therein or in any
written or oral statement or in any financial or other statements, instruments,
reports, certificates or any other documents made or furnished or made
available by Assignor to Assignee or by or on behalf of the Borrower or any
other Credit Party to Assignor or Assignee in connection with the Credit
Agreement, the Notes or the Note Assignments and the transactions contemplated
thereby. Assignor shall not be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained in the Credit Agreement, the Notes or the
Note Assignments or as to the use of the proceeds of the Advances or as to the
existence or possible existence of any event which constitutes an Event of
Default or which with the giving of notice or the passage of time or both would
constitute an Event of Default.
(b) Assignee represents and warrants that it has
made its own independent investigation of the financial condition and affairs
of the Borrower and each other Credit Party in connection with the making of
the Advances and the assignment of Assignee's Share of Assignor's Revolving
Credit Commitment and of Assignor's Advances to Assignee hereunder and has made
and shall continue to make its own appraisal of the creditworthiness of the
Borrower and each other Credit Party. Assignor shall have no duty or
responsibility either initially or on a continuing basis to make any such
investigation or any such appraisal on behalf of Assignee or to provide
Assignee with any credit or other information with respect thereto, whether
coming into its possession before the making of the Advances or at any time or
times thereafter and shall further have no responsibility with respect to the
accuracy of, or the completeness of, any
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164
information provided to Assignee, whether by Assignor or by or on behalf of
either the Borrower or any other Credit Party.
(c) THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY
OF THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
GEORGIA.
(d) No term or provision of this Assignment
Agreement may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by both parties.
(e) This Assignment Agreement may be executed in
one or more counterparts, each of which shall be an original but all of which,
taken together, shall constitute one and the same instrument.
(f) The Assignor may at any time or from time to
time grant to others assignments or participations in its Revolving Credit
Commitment or the Advances and Letter of Credit Obligations but not in the
portions thereof assigned to Assignee pursuant to this Assignment Agreement.
The Assignor represents and warrants that it has not at any time prior to the
Assignment Effective Date encumbered or assigned the portion of its Revolving
Credit Commitment or Advances being assigned hereunder.
(g) All payments hereunder or in connection
herewith shall be made in Dollars and in immediately available funds, if
payable to the Assignor, to the account of the Assignor at its address as
designated in the Credit Agreement, and, if payable to the Assignee, to the
account of the Assignee's address, as designated on the signature page hereof.
(h) This Assignment Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Neither of the parties hereto may assign or transfer
any of its rights or obligations under this Assignment Agreement without the
prior consent of the other party.
(i) All representations and warranties made
herein and indemnities provided for herein shall survive the consummation of
the transaction contemplated hereby.
(j) The Assignee acknowledges receipt of copies
of the documents received in connection with the transactions contemplated by
the Credit Agreement and this Assignment Agreement.
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165
IN WITNESS WHEREOF, the parties hereto have executed this
Assignment Agreement as of the date first above written.
[NAME OF ASSIGNOR]
By:
------------------------------------
Title:
Assignee's Share of [NAME OF ASSIGNEE]
Revolving Credit Commitment:
$ By:
----------------------------- ------------------------------------
Title:
Address:
---------------------------------------------
---------------------------------------------
---------------------------------------------
Tel. No:
------------------------
Fax No:
------------------------
CONSENTED TO AS OF THE
DATE SET FORTH ABOVE:
▇▇▇▇▇ ENTERPRISES, INC.
By:
-----------------------------------------------
Title:
-----------------------------------------
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166
EXHIBIT H
NOTE ASSIGNMENT AGREEMENT
THIS NOTE ASSIGNMENT AGREEMENT (the "Assignment") dated as of
November 6, 1995, made by ▇▇▇▇▇ ENTERPRISES, INC., a Delaware corporation (the
"Borrower") and each of the Subsidiaries of the Borrower named on the
signature pages hereof or from time to time becoming a party hereto (the
"Assigning Subsidiaries" and together with the Borrower, collectively, the
"Assignors" and individually, an "Assignor"), in favor of SUNTRUST BANK,
ATLANTA a Georgia banking corporation, (the "Agent"), in its capacity as agent
for banks and other lending institutions parties to the Credit Agreement (as
hereinafter defined) and each assignee thereof becoming a "Lender" as provided
therein (the "Lenders").
PRELIMINARY STATEMENTS:
(1) Certain lenders (together with other lenders that may
from time to time become parties thereto, the "Lenders"), the Agent and the
Borrower have entered into that certain Credit Agreement dated as of the date
hereof (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement", the terms defined therein and not otherwise defined herein
being used herein as therein defined).
(2) Pursuant to the Credit Agreement, the Lenders have
agreed to allow certain Intercompany Loans to and from the Borrower and its
Subsidiaries and between Subsidiaries of the Borrower upon the condition that
such Intercompany Loans are evidenced by an Intercompany Note which has been
pledged to the Agent for the benefit of the Lenders to secure the Obligations
of the Borrower.
(3) The parties hereto wish to enter into this Assignment
in fulfillment of the above-referenced condition.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
each of the Assignors hereby agrees with the Agent as follows:
SECTION 1. ASSIGNMENT. As collateral (collectively the
"Assigned Collateral") to secure the Secured Obligations (as defined in Section
2) each of the Assignors hereby:
(a) collaterally assigns and grants to the Agent, for the
ratable benefit of the Lenders, a lien on and a security interest in,
all of Assignor's right, title and interest in and to the Intercompany
Loans owing to each party hereto from the Borrower or any Subsidiary
of the Borrower, each
167
Intercompany Note evidencing any such Intercompany Loan and all other
instruments evidencing such Intercompany Loans, all other Intercompany
Loan Documents and all renewals and extensions thereof, accessions
thereto and substitutions therefor, whether now owned or held or
hereafter owned or held by any such Assignor; and
(b) collaterally assigns and grants to the Agent, for the
ratable benefit of the Lenders, to the maximum extent permitted by
applicable law, a lien on and a security interest in, all Proceeds of
the foregoing. Proceeds shall have the meaning assigned that term
under the Uniform Commercial Code as in effect in the State of Georgia
or under other relevant law and, in any event, shall include, but not
be limited to, any and all (i) instruments representing obligations
to pay amounts in respect of Assigned Collateral and (ii) other
amounts from time to time paid or payable under or in connection with
any of the Assigned Collateral.
Each of the parties hereto acknowledges and agrees that the assignment and
security interest created by this Assignment is, and is intended to be, a first
priority security interest with respect to all Intercompany Loans, Intercompany
Notes, Intercompany Loan Documents or other Assigned Collateral, whether now
existing or hereafter incurred or executed.
SECTION 2. SECURED OBLIGATIONS. This Assignment secures, and
the Assigned Collateral is collateral security for, the prompt payment or
performance in full when due, whether at stated maturity, by acceleration or
otherwise of all payments and other Obligations of the Borrower now existing or
hereafter arising, whether for principal, premium or interest (all such
obligations being the "Secured Obligations").
SECTION 3. NO RELEASE. Nothing set forth in this Assignment
shall relieve any Assignor from the performance of any term, covenant,
condition or agreement on such Assignor's part to be performed or observed
under or in respect of any of the Assigned Collateral or from any liability to
any entity under or in respect of any of the Assigned Collateral or impose any
obligation on the Agent or any Lender to perform or observe any such term,
covenant, condition or agreement on any Assignor's part to be so performed or
observed or impose any liability on the Agent or any Lender for any act or
omission on the part of any Assignor relating thereto or for any breach of any
representation or warranty on the part of any Assignor contained in this
Assignment, or in respect of the Assigned Collateral or made in connection
herewith or therewith. This paragraph shall survive the termination of this
Assignment and the discharge of each Assignor's other obligations hereunder.
SECTION 4. DELIVERY OF ASSIGNED COLLATERAL. All certificates
or instruments representing or evidencing the Intercompany Loans from the
Borrower or any Subsidiary of the
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Borrower, including without limitation, the Intercompany Notes, upon delivery
thereof to any Assignor, shall be promptly delivered to and held by the Agent
pursuant hereto and shall be in suitable form for transfer by delivery, or
shall be accompanied by duly executed instruments of transfer or assignment in
blank, all in form and substance satisfactory to the Agent.
SECTION 5. REPRESENTATIONS AND WARRANTIES. Each Assignor
represents and warrants as follows:
(a) Such Assignor is, and at the time of the delivery of
the Assigned Collateral pursuant to Section 4 of this Assignment will
be, the legal and beneficial owner of the Assigned Collateral free and
clear of any Lien except for the Lien and security interest created by
this Assignment;
(b) Such Assignor has full corporate power and authority
and legal right to pledge all the Assigned Collateral pursuant to this
Assignment and make the transfers contemplated by Section 4 hereof;
(c) No consent of any other party (including, without
limitation, stockholders or creditors of such Assignor) and no
consent, authorization, approval, or other action by, and no notice to
or filing with, any governmental authority or other Person is required
either (i) for the transfer by such Assignor of the Assigned
Collateral as contemplated by this Assignment or for the execution,
delivery or performance of this Assignment by such Assignor or (ii)
for the exercise by the Agent of the remedies in respect of the
Assigned Collateral pursuant to this Assignment, except as may be
required in connection with such disposition by laws affecting the
offering and sale of instruments generally or as otherwise required by
laws affecting creditors in general in connection with the exercise of
remedies by a secured party;
(d) Except as otherwise permitted by this Assignment, the
Assignors at all times will be the sole beneficial owners of the
Assigned Collateral;
(e) All information set forth herein relating to the
Assigned Collateral is accurate and complete in all material respects
as of the date hereof.
SECTION 6. SUPPLEMENTS, FURTHER ASSURANCES. Each Assignor
agrees that at any time and from time to time, at the expense of the Borrower,
any Assignor will promptly execute and deliver all further instruments and
documents and take all further action that may be necessary or that the Agent
may reasonably request, in order to protect any security interest granted or
purported to be granted hereby or to enable the Agent to exercise and enforce
its rights and remedies hereunder with respect to any Assigned Collateral.
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SECTION 7. PAYMENTS ON NOTES.
(a) As long as no Event of Default shall have occurred
and be continuing under the terms of this Assignment, each Assignor shall be
entitled to receive and retain, and to utilize free and clear of the lien of
this Assignment, any and all payments of interest and principal in respect of
the Assigned Collateral; provided, however, that any and all payments in the
form of securities or notes shall be, and shall be forthwith delivered to the
Agent to hold as, Assigned Collateral and shall, if received by any Assignor,
be received in trust for the benefit of the Agent, be segregated from the other
property or funds of such Assignor, and be forthwith delivered to the Agent as
Assigned Collateral in the same form as so received (with any necessary
endorsement).
(b) Upon the occurrence and during the continuance of an
Event of Default under the terms of this Assignment, all rights of each
Assignor to receive payments of interest or principal which it would otherwise
be authorized to receive and retain pursuant to Section 7(a) above shall cease
and all rights shall thereupon become vested in the Agent who shall thereupon
have the sole right to receive and hold such payments during the continuance of
such Event of Default.
(c) All payments which are received by any Assignor
contrary to the provisions of Section 7(b) above shall be received in trust for
the benefit of the Agent, shall be segregated from other funds of such Assignor
and shall be forthwith paid over to the Agent as Assigned Collateral in the
same form as so received (with any necessary endorsement).
SECTION 8. COVENANTS. Each of the Assignors hereby covenants
and agrees as follows:
(a) Not to encumber the Assigned Collateral with any
Lien, other than the Lien of this Assignment;
(b) To permit, and cause each of its Subsidiaries to
permit, any representative of the Agent or any Lender, at the Agent's
or such Lender's expense, to visit and inspect any of its property, to
examine its books and records and to make copies and take extracts
therefrom, and to discuss its affairs, finances and accounts with its
officers, all at such reasonable times, upon reasonable prior notice,
and as often as the Agent or such Lender may reasonably request;
provided that, no notice shall be required in the event that an Event
of Default has occurred and is continuing; and
(c) Not to sell or otherwise dispose of, or grant any
option or warrant with respect to, any of the Assigned Collateral; and
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(d) To assign hereunder, in accordance with Sections 2
and 7, any and all additional instruments, agreements and other
documents which are to become part of the Assigned Collateral.
SECTION 9. AGENT APPOINTED ATTORNEY-IN FACT. Each of the
Assignors hereby appoints the Agent as such Assignor's attorney-in-fact, with
full authority in the place and stead of such Assignor and in the name of such
Assignor or otherwise, from time to time in the Agent's discretion to take any
action and to execute any instrument which the Agent may deem necessary or
advisable to accomplish the purposes of this Assignment; provided that, unless
an Event of Default has occurred and is continuing, the Agent shall not
exercise its rights pursuant to this Section 9 until five (5) days after
written request to the Assignor to take such action or to execute such
instrument. If such Assignor fails to perform any agreement contained herein
within five (5) days after receipt of a written request to do so from the
Agent, the Agent may itself perform, or cause performance of, such agreement.
SECTION 10. REMEDIES UPON DEFAULT; DECISIONS RELATING TO
EXERCISE OF REMEDIES.
A. DEFINITION OF EVENTS OF DEFAULT. The following
specified events shall constitute events of default ("Events of Default"):
(a) The occurrence of any "Event of Default" pursuant to
the Credit Agreement (as such term is defined therein);
(b) any representation, warranty or statement made or
deemed to be made by any of the Assignor or any of its officers under
or in connection with this Assignment shall have been incorrect in any
material respect when made or deemed to be made; or
(c) any the Assignor shall fail to observe or perform any
covenant or agreement set forth in this Assignment.
B. REMEDIES UPON DEFAULT. If any Event of Default under
this Assignment shall have occurred and be continuing, the Agent may from
time to time exercise, in its sole discretion and without further notice or
demand, with respect to the Assigned Collateral, in addition to other rights
and remedies provided for herein or otherwise available to it, all of the
rights and remedies of a secured party under the Uniform Commercial Code (the
"Code") in effect in the State of Georgia.
SECTION 11. APPLICATION OF PROCEEDS. After and during the
continuance of an Event of Default described in Section 10, any cash held by
the Agent as Assigned Collateral and all cash proceeds received by the Agent
(all such cash being "Proceeds") in respect of any sale of, collection from, or
other realization upon
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all or any part of the Assigned Collateral pursuant to the exercise by the
Agent of its remedies as a secured creditor as provided in Section 12 of this
Assignment shall be applied promptly from time to time by the Agent:
FIRST, to the payment of the reasonable costs and expenses of
such sale, collection or other realization, including all expenses,
liabilities and advances made or incurred by the Agent or the Lenders
in connection therewith;
SECOND, to the payment of the Secured Obligations then due; and
THIRD, after payment in full of all Secured Obligations, to
the Assignor owed such indebtedness, or its successors or assigns, or
to whomsoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct, of any surplus then
remaining from such Proceeds.
SECTION 12. EXPENSES. The Assignors, jointly and severally,
will upon demand pay to the Agent and each Lender the amount of any and all
reasonable expenses, including the reasonable fees and expenses of its counsel
and of any experts and agents, which the Agent or any Lender may actually incur
in connection with (i) the administration of this Assignment, (ii) the custody
or preservation of, or the sale of, collection from, or other realization upon,
any of the Assigned Collateral, (iii) the exercise or enforcement of any of the
rights of the Agent or any Lender hereunder or (iv) the failure by any Assignor
to perform or observe any of the provisions hereof except where such expenses
result solely from the gross negligence or willful misconduct of the Agent or
such Lender.
SECTION 13. NO WAIVER. No failure on the part of the Agent
or any Lender to exercise, and no course of dealing with respect to, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by the Agent or any
Lender of any right, power or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies herein provided are to the full extent permitted by law cumulative and
are not exclusive of any remedies provided by law.
SECTION 14. AMENDMENTS, ETC. This Assignment may not be
amended, modified or waived except with the written consent of each of the
Assignors and the Agent. Any amendment, modification or supplement of or to
any provision of this Assignment, any termination or waiver of any provision of
this Assignment and any consent to any departure by any Assignor from the terms
of any provision of this Assignment shall be effective only in the specific
instance and for the specific purpose for which made or given. No notice to or
demand upon any Assignor in any instance hereunder shall entitle such Assignor
or any other Assignor to any
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other or further notice or demand in similar or other circumstances.
SECTION 15. TERMINATION. This Assignment shall terminate
upon the payment in full in cash in the applicable currency of all Secured
Obligations, and then the Agent shall, upon the request and at the expense of
the Assignors, forthwith assign, transfer and deliver, against receipt and
without recourse to the Agent or any Lender, such of the Assigned Collateral as
shall not have been sold or otherwise applied pursuant to the terms hereof to
or on the order of the Assignor.
SECTION 16. NOTICES. All notices, demands, instructions and
other communications required or permitted to be given to or made upon any
party hereto shall be in writing sent by first-class, registered or certified
mail, postage prepaid and addressed as follows:
(1) If to Agent, at the address specified in the Credit
Agreement, and
(2) If to Assignors, at the address specified on the
signature page hereto for such Assignor.
Either the Agent or any Assignor may change its address for notice purposes by
notice to the other parties as specified herein.
SECTION 17. ADDITIONAL ASSIGNORS. Upon execution and delivery
by any Subsidiary of the Borrower of an instrument in the form of Annex 1, such
Subsidiary of the Borrower shall become an Assignor hereunder with the same
force and effect as if originally named an Assignor herein (each an "Additional
Assignor"). The execution and delivery of any such instrument shall not
require the consent of any Assignor hereunder. The rights and obligations of
each Assignor hereunder shall remain in full force and effect notwithstanding
the addition of any Additional Assignor as a party to this Assignment.
SECTION 18. CONTINUING SECURITY INTEREST; SUCCESSORS AND
ASSIGNS. This Assignment shall create a continuing security interest in the
Assigned Collateral and shall (i) remain in full force and effect until payment
in full in cash in the applicable currency of all Secured Obligations or
otherwise terminated pursuant to Section 15, (ii) be binding upon the
Assignors, their respective successors and assigns, and (iii) inure, together
with the rights and remedies of the Agent hereunder, to the benefit of the
Agent, each Lender and each of its successors, transferees and assigns.
SECTION 19. GOVERNING LAW. This Assignment shall be governed
by, and construed in accordance with, the laws of the State of Georgia without
regard to the principles of conflicts of laws thereof.
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SECTION 20. EXECUTION IN COUNTERPARTS. This Assignment may
be executed in any number of counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute one and the same Assignment.
IN WITNESS WHEREOF, each of the Assignors has caused this
Assignment to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written.
ASSIGNORS:
ADDRESS: ▇▇▇▇▇ ENTERPRISES, INC.
One Atlantic Center
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
By:
-------------------------------------
Title:
-----------------------------
Attest:
-------------------------------------
Title:
-----------------------------
[CORPORATE SEAL]
ADDRESS: IRVING TANNING COMPANY
One Atlantic Center
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
By:
-------------------------------------
Title:
-----------------------------
Attest:
-------------------------------------
Title:
-----------------------------
[CORPORATE SEAL]
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ANNEX 1
SUPPLEMENT
TO
NOTE ASSIGNMENT AGREEMENT
THIS SUPPLEMENT TO NOTE ASSIGNMENT AGREEMENT (this "Supplement
to Note Agreement"), dated as of ___________, 19__, made by
______________________, a ________ corporation (the "Additional Assignor"), in
favor of SUNTRUST BANK, ATLANTA, a Georgia banking corporation (the "Agent"),
in its capacity as agent for banks and other lending institutions parties to
the Credit Agreement (as hereinafter defined) and each assignee thereof
becoming a "Lender" as provided therein (the "Lenders").
PRELIMINARY STATEMENTS:
(1) Certain lenders (together with other lenders
that may from time to time become parties thereto, the "Lenders"), the Agent
and the Borrower have entered into that certain Credit Agreement dated as of
November 6, 1995 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement", the terms defined therein and not otherwise
defined herein being used herein as therein defined).
(2) Pursuant to the Credit Agreement, the Lenders
have agreed to allow certain Intercompany Loans to and from the Borrower and
its Subsidiaries and between Subsidiaries of the Borrower upon the condition
that such Intercompany Loans are evidenced by an Intercompany Note which has
been pledged to the Agent for the benefit of the Lenders to secure the
Obligations of the Borrower.
(3) The Borrower and certain Subsidiaries of the
Borrower (collectively, the "Assignors") have executed and delivered that
certain Note Assignment Agreement dated as of November 6, 1995 (the "Note
Assignment Agreement") pursuant to which the Assignors have assigned and
granted to the Agent, for the benefit of the Lenders, a lien on and a security
interest in, all of their right title and interest in and to the Intercompany
Loans, the Intercompany Notes and the Intercompany Loan Documents to secure all
of the Obligations of the Borrower under the Credit Agreement and the other
Credit Documents (as defined in the Credit Agreement);
(4) It is a condition subsequent to the Lenders'
obligation to make loans to the Borrower under the Credit Agreement that the
Additional Assignor execute and deliver to the Agent this Supplement to Note
Agreement, and the Additional Assignor desires to execute and deliver this
Supplement to Note Agreement to satisfy such condition subsequent;
175
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Additional Assignor hereby agrees with the Agent as follows:
1. DEFINED TERMS. Capitalized terms not otherwise defined herein which
are used in the Note Assignment Agreement are used herein with the meanings
specified for such terms in the Note Assignment Agreement.
2. ADDITIONAL ASSIGNOR. The Additional Assignor agrees that it shall be
and become an Assignor for all purposes of the Note Assignment Agreement and
shall be fully bound thereby to the same extent and with the same effect as
though the Additional Assignor had been one of the Assignor originally
executing and delivering the Note Assignment Agreement. Without limiting the
foregoing, the Additional Assignor hereby agrees with the Agent that:
(a) As collateral (collectively the "Assigned
Collateral") to secure the Secured Obligations (as defined in Section 2(b)) the
Additional Assignors hereby:
(i) collaterally assigns and grants to the Agent, for the
ratable benefit of the Lenders, a lien on and a security interest in,
all of the Additional Assignor's right, title and interest in and to
the Intercompany Loans owing to each party hereto from the Borrower or
any Subsidiary of the Borrower, each Intercompany Note evidencing any
such Intercompany Loan and all other instruments evidencing such
Intercompany Loans, all other Intercompany Loan Documents and all
renewals and extensions thereof, accessions thereto and substitutions
therefor, whether now owned or held or hereafter owned or held by such
Additional Assignor; and
(b) collaterally assigns and grants to the Agent, for the
ratable benefit of the Lenders, to the maximum extent permitted by
applicable law, a lien on and a security interest in, all Proceeds of
the foregoing. Proceeds shall have the meaning assigned that term
under the Uniform Commercial Code as in effect in the State of Georgia
or under other relevant law and, in any event, shall include, but not
be limited to, any and all (i) instruments representing obligations
to pay amounts in respect of Assigned Collateral and (ii) other
amounts from time to time paid or payable under or in connection with
any of the Assigned Collateral.
Each of the parties hereto acknowledges and agrees that the assignment and
security interest created by this Assignment is, and is intended to be, a first
priority security interest with respect to all Intercompany Loans, Intercompany
Notes, Intercompany Loan Documents or other Assigned Collateral, whether now
existing or hereafter incurred or executed.
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(b) This Assignment secures, and the Assigned Collateral
is collateral security for, the prompt payment or performance in full when due,
whether at stated maturity, by acceleration or otherwise of all payments and
other Obligations of the Borrower now existing or hereafter arising, whether
for principal, premium or interest (all such obligations being the "Secured
Obligations").
All references in the Note Assignment Agreement to "Assignors" or any
"Assignor" shall be deemed to include and to refer to the Additional Assignor.
3. GOVERNING LAW. This Supplement to Note Agreement shall be governed
by, and construed in accordance with, the laws of the State of Georgia without
regard to the principles of conflicts of laws thereof.
IN WITNESS WHEREOF, the Additional Assignor has caused this
Supplement to Note Agreement to be duly executed and delivered under seal by
its duly authorized officers as of the date first above written.
Address for Notices: ADDITIONAL ASSIGNOR:
---------------------------------
By:
--------------------------------------------
Title:
--------------------------------------
Attest:
----------------------------------------
Title:
----------------------------------
[CORPORATE SEAL]
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EXHIBIT A
1. Promissory Note, dated as of November 6, 1995, made by Irving Tanning
Company in favor of ▇▇▇▇▇ Enterprises, Inc., in the maximum principal
amount of $60,000,000.
2. Promissory Note, dated as of November 6, 1995, made by Kroy Tanning
Company, Incorporated in favor of Irving Tanning Company, in the
maximum principal amount of $60,000,000.
178
EXHIBIT I
FORM OF INTERCOMPANY NOTE
$________________ Atlanta, Georgia
______________, 199_
FOR VALUE RECEIVED, the undersigned, _______________________, a
_______________ corporation (the "Borrower") hereby unconditionally promises to
pay to the order of ▇▇▇▇▇ ENTERPRISES, INC. (together with any other holder
hereof, the "Lender"), at its office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other address as may be specified by the
Lender to the Borrower, the principal sum of ___________________________ AND
___/100 DOLLARS ($_________________), or such lesser or greater amount as may
be the aggregate principal amount outstanding of all advances (each an
"Advance") made by the Lender to the Borrower pursuant to this Note.
The Borrower agrees to pay principal at said office, in like money,
from time to time on DEMAND by the Lender. The Borrower further agrees to pay
interest at said office, in like money, on the outstanding principal balance of
Advances owing hereunder at the variable rate equal to (a) the lowest rate of
interest payable from time to time by ▇▇▇▇▇ Enterprises, Inc. on Revolving
Loans outstanding under and as defined in the Credit Agreement dated as of
November __, 1995 (the "Credit Agreement") by and among ▇▇▇▇▇ Enterprises,
Inc., certain Lenders from time to time party thereto and SunTrust Bank,
Atlanta, as Agent (the "Agent") or (b) if no such Revolving Loans shall be then
outstanding under the Credit Agreement or if such Credit Agreement shall have
been terminated, at the rate of interest publicly announced by the Agent as its
prime lending rate. All accrued and unpaid interest shall be payable on
DEMAND.
The date and amount of each Advance made by the Lender to the Borrower
under this Note, each repayment of principal in respect thereof and the accrual
of interest under this Note, shall be recorded by the Lender on its books and,
prior to any transfer of this Note, endorsed by the Lender on Schedule I
attached hereto; provided, however, that the failure of the Lender to make any
such recordation or endorsement shall not affect the obligation of the Borrower
to make a payment when due of any amount owing under this Note. Any such
recordations or endorsements made by the Lender on its books or this Note shall
be conclusive and binding on the Borrower absent manifest error.
179
The Borrower hereby waives presentment, demand, protest and notice of
any kind. No failure to exercise, and no delay in exercising any rights
hereunder on the part of the holder hereof shall operate as a waiver of such
rights.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF GEORGIA.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Note under seal as of the date written above.
---------------------------------
By:
------------------------------
Name:
-----------------------
Title:
----------------------
180
SCHEDULE I
Amount of Amount of Outstanding
Date Borrowing Payment Principal Balance Notation
---- --------- --------- ----------------- --------