$200,000,000
CREDIT AGREEMENT
AMONG
RALCORP HOLDINGS, INC.
as Borrower,
THE LENDERS NAMED HEREIN,
and
BANK ONE, NA,
as Agent
DATED AS OF
July 10, 2000
BANC ONE CAPITAL MARKETS, INC.,
as Arranger
and
WACHOVIA BANK, N.A.,
as Syndication Agent
PNC BANK, NATIONAL ASSOCIATION
as Documentation Agent
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS 1
ARTICLE II
THE FACILITY
2.1. The Facility. 14
2.2. Advances. 15
2.3. Availability of Funds 16
2.4. Commitment Fee; Reductions in Aggregate Commitment. 16
2.5. Minimum Amount of Each Advance 16
2.6. Optional Principal Payments. 17
2.7. Changes in Interest Rate, etc. 17
2.8. Rates Applicable After Default. 17
2.9. Method of Payment 17
2.10. Notes; Telephonic Notices. 18
2.11 Interest Payment Dates; Interest and Fee Basis 17
2.12. Notification of Advances, Interest Rates, Prepayments, Commitment
Reductions and Issuance Requests 18
2.13. Lending Installations. 18
2.14. Non-Receipt of Funds by the Agent 18
2.15. Taxes. 19
2.16. Agent's Fees 20
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1. Yield Protection 20
3.2. Changes in Capital Adequacy Regulations 21
3.3. Availability of Types of Advances 21
3.4. Funding Indemnification 21
3.5. Lender Statements; Survival of Indemnity 22
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Initial Loans 22
4.2. Each Future Advance 24
ARTICLE V
REPRESENTATIONS AND WARRANTS
5.1. Corporate Existence and Standing 24
5.2. Authorization and Validity 25
5.3. Compliance with Laws and Contracts 25
5.4. Governmental Consents. 25
5.5. Financial Statements 25
5.6. Material Adverse Change 26
5.7. Taxes 26
5.8. Litigation and Contingent Obligations 26
5.9. Subsidiaries and Capitalization 26
5.10. ERISA 27
5.11. Defaults. 27
5.12. Federal Reserve Regulations 27
5.13. Investment Company; Public Utility Holding Company Act 27
5.14. Certain Fees. 27
5.15. Solvency 28
5.16. Ownership of Properties 28
5.17. Indebtedness 28
5.18. Subordinated Indebtedness 28
5.19. Employee Controversies 28
5.20. Material Agreements 28
5.21. Environmental Laws 29
5.22. Insurance 29
5.23. Disclosure 29
ARTICLE VI
COVENANTS 30
6.1. Financial Reporting 30
6.2. Use of Proceeds 31
6.3. Notice of Default 31
6.4. Conduct of Business 31
6.5. Taxes 32
6.6. Insurance 32
6.7. Compliance with Laws 32
6.8. Maintenance of Properties 32
6.9. Inspection. 32
6.10. Capital Stock and Dividends 32
6.11. Indebtedness 33
6.12. Merger 33
6.13. Sale of Assets 33
6.14. Sale of Accounts 33
6.15. Investments and Purchases 34
6.16. Contingent Obligations 35
6.17. Liens 35
6.18. Lease Rentals 36
6.19. Affiliates 36
6.20. Subordinated Indebtedness; Other Indebtedness 36
6.21. Environmental Matters 37
6.22. Change in Corporate Structure; Fiscal Year 37
6.23. Inconsistent Agreements 37
6.24. Financial Covenants 37
6.25. ERISA Compliance. 37
6.26. Material Subsidiaries 38
ARTICLE VII
DEFAULTS 38
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration 40
8.2. Amendments 40
8.3. Preservation of Rights 41
ARTICLE IX
GENERAL PROVISIONS 41
9.1. Survival of Representations 41
9.2. Governmental Regulation 41
9.3. Taxes 41
9.4. Headings 41
9.5. Entire Agreement 41
9.6. Several Obligations; Benefits of this Agreement 42
9.7. Expenses; Indemnification 42
9.8. Numbers of Documents 42
9.9. Accounting 42
9.10. Severability of Provisions 42
9.11. Nonliability of Lenders. 42
9.12. CHOICE OF LAW 43
9.13. CONSENT TO JURISDICTION 43
9.14. WAIVER OF JURY TRIAL 43
9.15. Disclosure 43
9.16. Counterparts 44
9.17. Confidentiality 44
ARTICLE X
THE AGENT 44
10.1. Appointment 44
10.2. Powers 45
10.3. General Immunity 45
10.4. No Responsibility for Loans, Recitals, etc. 45
10.5. Action on Instructions of Lenders 45
10.6. Employment of Agents and Counsel 45
10.7. Reliance on Documents; Counsel 46
10.8. Agent's Reimbursement and Indemnification 46
10.9. Notice of Default 46
10.10. Rights as a Lender 46
10.11. Lender Credit Decision. 46
10.12. Successor Agent 47
10.13. Documentation Agent 47
ARTICLE XI
SETOFF; RATABLE PAYMENTS 47
11.1. Setoff 47
11.2. Ratable Payments 47
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS 48
12.1. Successors and Assigns 48
12.2. Participations. 48
12.3. Assignments. 49
12.4. Dissemination of Information 50
12.5. Tax Treatment 50
ARTICLE XIII
NOTICES 50
13.1. Giving Notice. 50
13.2. Change of Address 50
EXHIBITS
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Exhibit A - Note
Exhibit B - Compliance Certificate
Exhibit C - Assignment Agreement
Exhibit D - Form of General Counsel Opinion
SCHEDULES
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Schedule 1 - Commitments
Schedule 5.8 - Material Contingent Obligations
Schedule 5.9 - Subsidiaries and Capitalization
Schedule 5.10 - ERISA
Schedule 5.14 - Brokers' Fees
Schedule 5.16 - Properties
Schedule 5.17 - Indebtedness
Schedule 6.15 - Investments
Schedule 6.17 - Liens
CREDIT AGREEMENT
This Credit Agreement, dated as of July 10, 2000, is among RALCORP
HOLDINGS, INC., a Missouri corporation (the "Borrower"), the Lenders and BANK
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ONE, NA, a national banking association having its principal office in Chicago,
Illinois, individually and as Agent.
R E C I T A L S:
- - - - - - - -
A. RH Financial Corporation, a Nevada corporation and a Wholly-Owned
Subsidiary of the Borrower ("RH Financial") is party to a certain Stock Purchase
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Agreement (as hereinafter defined), pursuant to which RH Financial has agreed to
purchase all of the outstanding shares of stock of RHM Holdings (USA) Inc., a
Delaware corporation (the "RHM Acquisition").
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B. The Borrower has requested that the Lenders make financial accommodations
to it in an initial aggregate principal amount of $200,000,000, the proceeds of
which the Borrower will use to finance (i) the RHM Acquisition, (ii) general
corporate needs of the Borrower and its Subsidiaries (including, but not limited
to, repurchasing its capital stock), (iii) working capital for the Borrower and
its Subsidiaries, and (iv) non-hostile acquisitions by the Borrower.
C. The Lenders are willing to extend such financial accommodations on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and undertakings herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrower, the Lenders and the
Agent hereby agree as follows:
ARTICLE I
DEFINITIONS
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As used in this Agreement:
"Accounts Receivable Financing Program" means a program of sales or
securitization of, or transfers of interests in, accounts receivable and related
contract rights ("Receivables") by the Borrower or any Subsidiary on a limited
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recourse basis pursuant to which the aggregate amount of financing thereunder
shall not exceed $50,000,000 at any time outstanding, provided that such sale or
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transfer qualifies as a sale under Agreement Accounting Principles.
"Adjusted EBITDA" means, for any applicable computation period, the sum of (a)
EBIT for such period plus (b) the Borrower's and Subsidiaries' amortization and
----
depreciation deducted in determining Net Income for such period; provided,
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however, that (i) Adjusted EBITDA shall be calculated giving pro forma effect
for any Permitted Purchase during such period as though such Permitted Purchase
occurred on the first day of such period, and (ii) in the event that the
Borrower sells or otherwise disposes of all or any portion of the capital stock
of Vail Resorts, Inc. during such period, then Adjusted EBITDA shall be
calculated by subtracting (adding) all equity earnings (losses) attributable to
such divested interest for such period.
"Adjusted Net Income" means, for any computation period (a) Net Income for such
period, minus (plus) (b) earnings (losses) during such period attributable to
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the equity investment by the Borrower and its Subsidiaries in Vail Resorts, Inc.
and included in the computation of Net Income for such period, plus (c) to the
----
extent not included in the computation of Net Income for such period, the sum of
all proceeds in excess of book value (net of related costs, expenses, fees and
taxes) received by the Borrower or any Subsidiary of the Borrower during such
period from the sale or other disposition of the capital stock of Vail Resorts,
Inc.
"Adjusted Net Worth" means at any date (a) Net Worth minus (b) the value of the
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equity investment of the Borrower and its Subsidiaries in Vail Resorts, Inc.
included in the computation of Net Worth at such date.
"Advance" means a borrowing hereunder consisting of the aggregate amount of the
several Loans made by the Lenders to the Borrower at the same time, of the same
Type and for the same Eurodollar Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as agent for the Lenders pursuant to
Article X, and not in its individual capacity as a Lender, and any successor
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Agent appointed pursuant to Article X.
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"Aggregate Commitment" means the aggregate of the Commitments of all the Lenders
hereunder. The initial Aggregate Commitment is $200,000,000 as of the date
hereof, as adjusted from time to time pursuant to the terms of this Agreement.
"Agreement" means this Credit Agreement, as it may be amended, modified or
restated and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting principles
as in effect from time to time, applied in a manner consistent with those used
in preparing the Financial Statements; provided, however, that for purposes of
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all computations required to be made with respect to compliance by the Borrower
with Section 6.24, such term shall mean generally accepted accounting principles
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as in effect on the date hereof, applied in a manner consistent with those used
in preparing the Financial Statements.
"Alternate Base Rate" means, for any day, a rate of interest per annum equal to
the higher of (a) the Prime Rate for such day and (b) the Federal Funds
Effective Rate most recently determined by the Agent plus of 1% per annum.
"Alternate Base Rate Advance" means an Advance which bears interest at the
Alternate Base Rate.
"Alternate Base Rate Loan" means a Loan which bears interest at the Alternate
Base Rate.
"Applicable Commitment Fee Percentage" means 0.20%.
"Applicable Eurodollar Margin" means (a) at any time prior to the Revolving
Credit Termination Date, the greater of (i) 1.00% and (ii) the sum of (A) the
"Applicable Eurodollar Margin" then in effect pursuant to the Existing Credit
Agreement, plus (B) 0.125% and (b) at any time on or after the Revolving Credit
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Termination Date, the greater of (i) 1.25% and (ii) the sum of (A) the
"Applicable Eurodollar Margin" then in effect pursuant to the Existing Credit
Agreement, plus (B) 0.375%.
----
"Arranger" means Banc One Capital Markets, Inc. and its successors.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Asset Disposition" means any sale, transfer or other disposition of any asset
of the Borrower or any Subsidiary in a single transaction or in a series of
related transactions (other than the sale of inventory or unused or obsolete
equipment in the ordinary course).
"Authorized Officer" means any of the president, chief financial officer,
treasurer or controller of the Borrower, acting singly.
"Bank One" means Bank One, NA, a national banking association having its
principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Bankruptcy Code" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, sections 1 et seq., as the
-- ---
same may be amended from time to time, and any successor thereto or replacement
therefor which may be hereafter enacted.
"Borrower" means Ralcorp Holdings, Inc., a Missouri corporation.
"Borrowing Date" means a date on which an Advance is made.
"Borrowing Notice" is defined in Section 2.2.3.
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"Business Day" means (a) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago for the conduct of substantially all
of their commercial lending activities and on which dealings in United States
dollars are carried on in the London interbank market, and (b) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago for the conduct of substantially all of their commercial lending
activities.
"Capitalized Lease" of a Person means any lease of Property by such Person as
lessee which would be capitalized on a balance sheet of such Person prepared in
accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the obligations
of such Person under Capitalized Leases which would be shown as a liability on a
balance sheet of such Person prepared in accordance with Agreement Accounting
Principles.
"Change" is defined in Section 3.2.
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"Change in Control" means (a) the acquisition by any Person, or two or more
Persons acting in concert, including without limitation any acquisition effected
by means of any transaction contemplated by Section 6.12, of beneficial
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ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934) of 20% or more of the
outstanding shares of voting stock of the Borrower, or (b) during any period of
25 consecutive calendar months, commencing on the date of this Agreement, the
ceasing of those individuals (the "Continuing Directors") who (i) were directors
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of the Borrower on the first day of each such period or (ii) subsequently became
directors of the Borrower and whose initial election or initial nomination for
election subsequent to that date was approved by a majority of the Continuing
Directors then on the board of directors of the Borrower, to constitute a
majority of the board of directors of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to make Loans
not exceeding the amount set forth in Schedule 1 hereto and as set forth in any
Notice of Assignment relating to any assignment which has become effective
pursuant to Section 12.3.2, as such amount may be modified from time to time
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pursuant to the terms hereof.
"Condemnation" is defined in Section 7.8.
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"Consolidated" or "consolidated", when used in connection with any
calculation, means a calculation to be determined on a consolidated basis for
the Borrower and its Subsidiaries in accordance with Agreement Accounting
Principles.
"Consolidated Interest Expense" means, with respect to any period, the sum
(without duplication) of (i) Consolidated interest expense of the Borrower and
its Consolidated Subsidiaries for such period before the effect of interest
income, as reflected on the Consolidated statements of income for the Borrower
and its Consolidated Subsidiaries for such period, and (ii) Consolidated
interest, yield or discount accrued during such period on the aggregate
outstanding investment or claim held by purchasers, assignees or other
transferees of (or of interests in) receivables of the Borrower and its
Consolidated Subsidiaries in connection with a revolving Accounts Receivable
Financing Program (regardless of the accounting treatment of such Accounts
Receivable Financing Program).
"Consolidated Person" means, for the taxable year of reference, each Person
which is a member of the affiliated group of the Borrower if Consolidated
returns are or shall be filed for such affiliated group for federal income tax
purposes or any combined or unitary group of which the Borrower is a member for
state income tax purposes.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement or take-or-pay contract or application for a Letter of Credit.
"Controlled Group" means all members of a controlled group of corporations and
all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.7.
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"Default" means an event described in Article VII.
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"EBIT" means, for any applicable computation period, the Borrower's and
Subsidiaries' Net Income on a consolidated basis, plus (a) consolidated Federal,
----
state, local and foreign income and franchise taxes paid or accrued during such
period and (b) Consolidated Interest Expense for such period, minus (or plus)
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equity earnings (or losses) during such period attributable to equity
investments by the Borrower and its Subsidiaries in the capital stock or other
equity interests in any Person which is not a Subsidiary (other than Vail
Resorts, Inc.).
"Environmental Claims" means all claims, investigations, litigation,
administrative proceedings, notices, requests for information, whether pending
or threatened, or judgements or orders, however asserted, by any Governmental
Authority or other Person alleging potential liability or responsibility for any
violation of any Environmental Laws, or for any Release or injury to the
environment.
"Environmental Laws" means all federal, state and local laws, statutes, common
law duties, rules, regulations, ordinances and codes, together with all
administrative orders, direct duties, requests, licenses, approvals,
certificates, decrees, standards, permits and other authorizations of, and
agreements with, any Governmental Authority, in each case relating to
environmental, health, safety and land use matters, including without
limitations, chemical substances, air emissions, effluent discharges and the
storage, treatment, transport and disposal of Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time.
"Eurodollar Advance" means an Advance which bears interest at a Eurodollar Rate
requested by the Borrower pursuant to Section 2.2.3.
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"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Eurodollar Interest Period, the applicable British Bankers' Association
Interest Settlement Rate for deposits in U.S. dollars appearing on Reuters
Screen FRBD as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Eurodollar Interest Period, and having a maturity equal to such
Eurodollar Interest Period, provided that, (i) if Reuters Screen FRBD is not
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available to the Agent for any reason, the applicable Eurodollar Base Rate for
the relevant Eurodollar Interest Period shall instead be the applicable British
Bankers' Association Interest Settlement Rate for deposits in U.S. dollars as
reported by any other generally recognized financial information service as of
11:00 a.m. (London time) two Business Days prior to the first day of such
Eurodollar Interest Period, and having a maturity equal to such Eurodollar
Interest Period, and (ii) if no such British Bankers' Association Interest
Settlement Rate is available to the Agent, the applicable Eurodollar Base Rate
for the relevant Eurodollar Interest Period shall instead be the rate determined
by the Agent to be the rate at which Bank One or one of its Affiliate banks
offers to place deposits in U.S. dollars with first-class banks in the London
interbank market at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Eurodollar Interest Period, in the approximate
amount of Bank One's relevant Eurodollar Loan and having a maturity equal to
such Eurodollar Interest Period.
"Eurodollar Interest Period" means, with respect to a Eurodollar Advance, a
period of seven days or one, two, three or six months commencing on a Business
Day selected by the Borrower pursuant to this Agreement. A Eurodollar Interest
Period of one, two, three or six months shall end on (but exclude) the day which
corresponds numerically to such date one, two, three or six months thereafter;
provided, however, that if there is no such numerically corresponding day in
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such next, second, third or sixth succeeding month, such Eurodollar Interest
Period shall end on the last Business Day of such next, second, third or sixth
succeeding month. If a Eurodollar Interest Period would otherwise end on a day
which is not a Business Day, such Eurodollar Interest Period shall end on the
next succeeding Business Day; provided, however, that if, with respect to a
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Eurodollar Interest Period of one, two, three or six months, said next
succeeding Business Day falls in a new month, such Eurodollar Interest Period
shall end on the immediately preceding Business Day.
"Eurodollar Loan" means a Loan requested by the Borrower pursuant to Section
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2.2.3 which bears interest at a Eurodollar Rate.
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"Eurodollar Rate" means, with respect to a Eurodollar Advance for the relevant
Eurodollar Interest Period, the sum of (a) the quotient of (i) the Eurodollar
Base Rate applicable to such Eurodollar Interest Period, divided by (ii) one
minus the Reserve Requirement (expressed as a decimal) applicable to such
Eurodollar Interest Period, plus (b) the Applicable Eurodollar Margin. The
Eurodollar Rate shall be rounded to the next higher multiple of 1/16 of 1% if
the rate is not such a multiple.
"Existing Credit Agreement" means that certain credit agreement among Bank One,
as agent, the financial institutions party thereto, and Ralcorp Holdings, Inc.
dated as of April 28, 1999, as amended, restated, replaced or refinanced.
"Facility Termination Date" means April 10, 2001, as such date may be extended
pursuant to Section 2.1.4.
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"Federal Funds Effective Rate" means, for any day, an interest rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Financial Statements" is defined in Section 5.5.
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"Fiscal Quarter" means one of the four three-month accounting periods
comprising a Fiscal Year.
"Fiscal Year" means the twelve-month accounting period ending September 30 of
each year.
"Governmental Authority" means any government (foreign or domestic) or any state
or other political subdivision thereof or any governmental body, agency,
authority, department or commission (including without limitation any taxing
authority or political subdivision) or any instrumentality or officer thereof
(including without limitation any court or tribunal) exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any corporation, partnership or other entity directly or
indirectly owned or controlled by or subject to the control of any of the
foregoing.
"Guarantors" means ▇▇▇▇▇▇▇, Inc., Cascade Cookie Company, Inc., Flavor House
Products, Inc., ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co., Inc., Nutcracker
Brands, Inc., RH Financial Corporation, Ripon Foods, Inc., Sugar Kake Cookie
Inc., ▇▇▇▇▇ Company, and each other Material Subsidiary.
"Hazardous Materials" means any toxic or hazardous waste, substance or chemical
or any pollutant, contaminant, chemical or other substance defined or regulated
pursuant to any Environmental Laws, including, without limitation, asbestos,
petroleum or crude oil.
"Indebtedness" of a Person means such Person's (a) obligations for borrowed
money, (b) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (c) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (d)
obligations which are evidenced by notes, acceptances, or similar instruments,
(e) Capitalized Lease Obligations, (f) Rate Hedging Obligations, (g) Contingent
Obligations, (h) the face amount of any Letter of Credit, (i) obligations under
so-called "synthetic leases" and (j) repurchase obligations or liabilities of
such Person with respect to accounts or notes receivable sold by such Person.
"Interest Expense Coverage Ratio" means for any applicable computation period of
the Borrower, the ratio of EBIT to the Borrower's Consolidated Interest Expense
for such period, all as determined in accordance with Agreement Accounting
Principles.
"Investment" of a Person means any loan, advance (other than commission, travel
and similar advances to officers and employees made in the ordinary course of
business), extension of credit (other than accounts receivable arising in the
ordinary course of business on terms customary in the trade), deposit account or
contribution of capital by such Person to any other Person or any investment in,
or purchase or other acquisition of, the stock, partnership interests, notes,
debentures or other securities of any other Person made by such Person.
"Lenders" means the lending institutions listed on the signature pages of this
Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, any office,
branch, subsidiary or affiliate of such Lender or the Agent.
"Letter of Credit" of a Person means a letter of credit or similar instrument
which is issued upon the application of such Person or upon which such Person is
an account party or for which such Person is in any way liable.
"Leverage Ratio" means, with respect to the Borrower on a consolidated basis
with its Subsidiaries, at the end of any Fiscal Quarter, the ratio of (a) Total
Debt at the end of such Fiscal Quarter to (b) Adjusted EBITDA for the four
Fiscal Quarters then ending.
"Lien" means any security interest, lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's portion of any Advance and
"Loans" means, with respect to the Lenders, the aggregate of all Advances.
"Loan Documents" means this Agreement, the Notes, the Subsidiary Guaranty and
the other documents and agreements contemplated hereby and executed by the
Borrower in favor of the Agent or any Lender.
"Margin Stock" has the meaning assigned to that term under Regulation U.
"Material Adverse Effect" means a material adverse effect on (a) the
business, Property, condition (financial or other) and results of operations of
the Borrower and its Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform its obligations under the Loan Documents, or (c) the
validity or enforceability of any of the Loan Documents or the rights or
remedies of the Agent or the Lenders thereunder.
"Material Subsidiary" means a Subsidiary of the Borrower organized under the
laws of a jurisdiction located within the United States and at any time having
assets with a fair market value in excess of $10,000,000; provided, however,
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that any special purpose Subsidiary established for the purpose of entering into
the Accounts Receivable Financing Program shall not be a Material Subsidiary.
"Moody's" means ▇▇▇▇▇'▇ Investor Services, Inc.
"Net Income" means, for any computation period, with respect to the
Borrower on a consolidated basis with its Subsidiaries (other than any
Subsidiary which is restricted from declaring or paying dividends or otherwise
advancing funds to its parent whether by contract or otherwise), cumulative net
income earned during such period as determined in accordance with Agreement
Accounting Principles, but (i) excluding any non-cash charges or gains which are
unusual, non-recurring or extraordinary and (ii) including, to the extent not
otherwise included in the determination of Net Income, all cash dividends and
cash distributions received by the Borrower or any Subsidiary from any Person in
which the Borrower or such Subsidiary has made an Investment pursuant to Section
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6.15(j).
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"Net Worth" means at any date the consolidated common stockholders' equity of
the Borrower and its consolidated Subsidiaries determined in accordance with
Agreement Accounting Principles.
"Note" means a promissory note in substantially the form of Exhibit A hereto,
---------
duly executed and delivered to the Agent by the Borrower for the account of each
Lender and payable to the order of a Lender in the amount of its Commitment,
including any amendment, modification, renewal or replacement of such promissory
note.
"Notice of Assignment" is defined in Section 12.3.2.
---------------
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Notes, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders or to any
Lender, the Agent or any indemnified party hereunder arising under any of the
Loan Documents.
"Participants" is defined in Section 12.2.1.
---------------
"Payment Date" means the last day of each March, June, September and
December.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor thereto.
"Permitted Purchase" means an acquisition permitted by Section 6.15(m).
---------------
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, limited liability company, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan, as defined in Section 3(2) of
ERISA, as to which the Borrower or any member of the Controlled Group may have
any liability.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"pro-rata" means, when used with respect to a Lender, and any described
aggregate or total amount, an amount equal to such Lender's pro-rata share or
portion based on its percentage of the Aggregate Commitment or if the Aggregate
Commitment has been terminated, its percentage of the aggregate principal amount
of outstanding Advances.
"Purchase" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (a) acquires any ongoing business or all or substantially
all of the assets of any firm, corporation or division or line of business
thereof, whether through purchase of assets, merger or otherwise, or (b)
directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage or voting
power) of the outstanding partnership interests of a partnership.
"Purchasers" is defined in Section 12.3.1.
---------------
"▇▇▇▇▇▇▇ Obligations" means the indemnification obligations of the Borrower
existing on the date hereof in favor of ▇▇▇▇▇▇▇ Purina Company with respect to
its guaranty of the obligations of ▇▇▇▇▇▇▇ Resorts, Inc. under the Sports
Facilities Refunding Revenue Bonds identified on Schedule 5.8.
-------------
"Rate Hedging Obligations" of a Person means any and all obligations of such
Person, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all
agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts and warrants, and (b) any and all
cancellations, buybacks, reversals, terminations or assignments of any of the
foregoing.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to depositary institutions.
"Regulation T" means Regulation T of the Board of Governors of the Federal
Reserve System as from time to time in effect and shall include any successor or
other regulation or official interpretation of such Board of Governors relating
to the extension of credit by securities brokers and dealers for the purpose of
purchasing or carrying margin stocks applicable to such Persons.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to such Persons.
"Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and shall include any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by the specified lenders for the purpose of
purchasing or carrying margin stocks applicable to such Persons.
"Release" is defined in the Comprehensive Environmental Response, Compensation
and Liability Act, as amended, 42 U.S.C. 39601 et seq.
-- ---
"Rentals" of a Person means the aggregate fixed amounts payable by such Person
under any operating lease of Property.
"Reportable Event" means a reportable event as defined in Section 4043 of ERISA
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event; provided, that a failure to meet the minimum
--------
funding standard of Section 412 of the Code and of Section 302 of ERISA shall be
a Reportable Event regardless of the issuance of any such waiver of the notice
requirement in accordance with either Section 4043(a) of ERISA or Section 412(d)
of the Code.
"Required Lenders" means Lenders in the aggregate having at least 51% of the
Aggregate Commitment or, if the Aggregate Commitment has been terminated, 51% of
the aggregate unpaid principal amount of the outstanding Loans.
"Reserve Requirement" means, with respect to a Eurodollar Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Credit Termination Balance" means the aggregate principal amount of
Advances outstanding on the Revolving Credit Termination Date after giving
effect to any Advances repaid on such date.
"Revolving Credit Termination Date" means April 10, 2001 or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.
"RH Financial" is defined in the Recitals to this Agreement.
"RHM Acquisition" is defined in the Recitals to this Agreement.
"RHM Acquisition Documents" means the Stock Purchase Agreement and the other
documents, certificates and agreements delivered in connection with the RHM
Acquisition.
"Risk-Based Capital Guidelines" is defined in Section 3.2.
------------
"S&P" means Standard & Poor's Ratings Group, a division of the ▇▇▇▇▇▇-▇▇▇▇
Companies.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Single Employer Plan" means a Plan subject to Title IV of ERISA maintained by
the Borrower or any member of the Controlled Group for employees of the Borrower
or any member of the Controlled Group, other than a Multiemployer Plan.
"Solvent" means, when used with respect to a Person, that (a) the fair saleable
value of the assets of such Person is in excess of the total amount of the
present value of its liabilities (including for purposes of this definition all
liabilities (including loss reserves as determined by such Person), whether or
not reflected on a balance sheet prepared in accordance with Agreement
Accounting Principles and whether direct or indirect, fixed or contingent,
secured or unsecured, disputed or undisputed), (b) such Person is able to pay
its debts or obligations in the ordinary course as they mature and (c) such
Person does not have unreasonably small capital to carry out its business as
conducted and as proposed to be conducted. "Solvency" shall have a correlative
meaning.
"Stock Purchase Agreement" means that certain Stock Purchase Agreement, dated as
of June 15, 2000 between ▇▇▇▇▇▇▇ Overseas Holdings S.A., a company organized
under the laws of Luxembourg, and RH Financial.
"Subordinated Indebtedness" of a Person means any Indebtedness of such Person
the payment of which is subordinated to payment of the Obligations to the
written satisfaction of the Agent.
"Subsidiary" of a Person means (a) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(b) any partnership, association, joint venture, limited liability company or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Subsidiary Guaranty" means that certain Guaranty, dated as of the date hereof,
duly executed and delivered by the Guarantors in favor of the Agent, on behalf
of the Lenders, as the same may be amended, supplemented or otherwise modified
from time to time.
"Substantial Portion" means, with respect to the Property of the Borrower and
its Subsidiaries, Property which (a) represents more than 15% of the
consolidated tangible assets of the Borrower and its Subsidiaries, as would be
shown in the consolidated financial statements of the Borrower and its
Subsidiaries as at the end of the Fiscal Quarter next preceding the date on
which such determination is made, or (b) is responsible for more than 5% of the
consolidated Net Income from continuing operations of the Borrower and its
Subsidiaries for the 12-month period ending as of the end of the Fiscal Quarter
next preceding the date of determination.
"Termination Event" means, with respect to a Plan which is subject to Title IV
of ERISA, (a) a Reportable Event, (b) the withdrawal of the Borrower or any
other member of the Controlled Group from such Plan during a plan year in which
the Borrower or any other member of the Controlled Group was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA or was deemed such under
Section 4068(f) of ERISA, (c) the termination of such Plan, the filing of a
notice of intent to terminate such Plan or the treatment of an amendment of such
Plan as a termination under Section 4041 of ERISA, (d) the institution by the
PBGC of proceedings to terminate such Plan or (e) any event or condition which
might constitute grounds under Section 4042 of ERISA for the termination of, or
appointment of a trustee to administer, such Plan.
"Thomson" means Thomson BankWatch Inc.
"Total Debt" means (a) all Indebtedness of the Borrower and its
Subsidiaries, on a consolidated basis, reflected on a balance sheet prepared in
accordance with Agreement Accounting Principles, plus, without duplication (b)
----
the face amount of all outstanding Letters of Credit in respect of which the
Borrower or any Subsidiary has any reimbursement obligation and the principal
amount of all Contingent Obligations of the Borrower and its Subsidiaries, plus
----
(c) the aggregate principal amount of all Indebtedness of a special purpose
Subsidiary of the Borrower formed in connection with the sale of accounts
receivable and other forms of off-balance sheet financing, minus (d) to the
-----
extent included in clause (b) above, (i) up to $15,000,000 in aggregate face or
principal amount of surety bonds and Letters of Credit relating to workers'
compensation and similar benefits and (ii) the ▇▇▇▇▇▇▇ Obligations.
"Transferee" is defined in Section 12.4.
-------------
"Type" means, with respect to any Advance, its nature as an Alternate Base
Rate Advance or Eurodollar Advance.
"UCC" means the Illinois Uniform Commercial Code as amended or modified and in
effect from time to time.
"Unfunded Liability" means the amount (if any) by which the present value of all
vested and unvested accrued benefits under a Single Employer Plan exceeds the
fair market value of assets allocable to such benefits, all determined as of the
then most recent valuation date for such Plans using PBGC actuarial assumptions
for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or the giving
of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (a) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (b) any partnership, association, joint venture, limited
liability company or similar business organization 100% of the ownership
interests having ordinary voting power of which shall at the time be so owned or
controlled.
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.
ARTICLE II
THE FACILITY
------------
2.1. The Facility.
-------------
2.1.1. Description of Facility. The Lenders hereby establish in favor
------------------------
of the Borrower a revolving credit facility pursuant to which, and upon the
terms and subject to the conditions herein set out. Each Lender severally
agrees to make Loans to the Borrower in accordance with Section 2.2 in amounts
-----------
not to exceed in the aggregate at any one time outstanding the amount of its
Commitment.
2.1.2. Facility Amount. In no event may the aggregate principal amount
---------------
of all outstanding Advances at any time exceed the Aggregate Commitment. If at
any time the aggregate amount of the Loans exceeds the Aggregate Commitment, the
Borrower shall repay immediately its then outstanding Loans in such amount as
may be necessary to eliminate such excess.
2.1.3. Availability of Facility. Subject to the terms of this Agreement,
--------------------------
from and including the date hereof to, but not including the Revolving Credit
Termination Date the Borrower may borrow, repay and reborrow Advances hereunder.
The Commitments to lend hereunder shall expire on the Revolving Credit
Termination Date. Principal payments made after the Revolving Credit
Termination Date may not be reborrowed.
2.1.4. Required Payments; Termination. Any outstanding Advances and all
--------------------------------
other unpaid Obligations shall be paid in full by the Borrower on the Facility
Termination Date; provided that if Borrower (a) provides notice of extension of
--------
the Facility Termination Date not less than 5 Business Days and not more than 30
Business Days prior to the Revolving Credit Termination Date and (b) on the date
that Borrower provides such notice, Borrower pays an extension fee to the Agent
for the ratable benefit of the Lenders, equal to 0.10% of the aggregate amount
of Loans outstanding on the unextended Facility Termination Date, then, if and
only if on the unextended Facility Termination Date no Default or Unmatured
Default shall have occurred and be continuing, then on such date the Facility
Termination Date shall be extended to January 10, 2002 with respect to the
Revolving Credit Termination Balance. Any portion of the Revolving Credit
Termination Balance remaining unpaid on January 10, 2002 shall be repaid in full
on such date.
2.2. Advances.
--------
2.2.1. Advances. Each Advance hereunder shall consist of borrowings
--------
made from the several Lenders ratably in proportion to the amounts of their
respective Commitments. The Borrower's obligation to pay the principal of, and
interest on, the Advances shall be evidenced by the Notes. Although the Notes
shall be dated the date of the initial Advance, interest in respect thereof
shall be payable only for the periods during which the Loans evidenced thereby
are outstanding and, although the stated amount of each Note shall be equal to
the applicable Lender's Commitment, each Note shall be enforceable, with respect
to the Borrower's obligation to pay the principal amount thereof, only to the
extent of the unpaid principal amount of the Loans at the time evidenced
thereby.
2.2.2 Advance Rate Options. The Advances may be Alternate Base Rate
----------------------
Advances or Eurodollar Advances, or a combination thereof, selected by the
Borrower in accordance with Section 2.2.3 or 2.2.4. No Advance may mature
-------------- -----
after, or have a Eurodollar Interest Period which extends beyond, the Facility
Termination Date.
2.2.3. Method of Selecting Types and Eurodollar Interest Periods for
---------------------------------------------------------------------
Advances. The Borrower shall select the Type of each Advance and, in the case
of each Eurodollar Advance, the Eurodollar Interest Period applicable to such
Advance from time to time. The Borrower shall give the Agent irrevocable notice
(a "Borrowing Notice") not later than 10:00 a.m. (Chicago time) on the Borrowing
----------------
Date of each Alternate Base Rate Advance and three Business Days before the
Borrowing Date for each Eurodollar Advance. A Borrowing Notice shall specify:
(a) the Borrowing Date, which shall be a Business Day, of such Advance;
(b) the aggregate amount of such Advance, which, when added to all
outstanding Advances and after giving effect to the repayment of any such
outstanding Advances or Loans out of the proceeds of the requested Advance,
shall not exceed the Aggregate Commitment;
(c) the Type of Advance selected; and
(d) in the case of each Eurodollar Advance, the Eurodollar Interest Period
applicable thereto (which may not end after the Facility Termination Date).
2.2.4. Conversion and Continuation of Outstanding Advances. Alternate
----------------------------------------------------
Base Rate Advances shall continue as Alternate Base Rate Advances unless and
until such Alternate Base Rate Advances are converted into Eurodollar Advances.
Each Eurodollar Advance shall continue as a Eurodollar Advance until the end of
the then applicable Eurodollar Interest Period therefor, at which time such
Eurodollar Advance shall be automatically converted into an Alternate Base Rate
Advance unless the Borrower shall have given the Agent a Conversion/Continuation
Notice requesting that, at the end of such Eurodollar Interest Period, such
Eurodollar Advance continue as a Eurodollar Advance for the same or another
Eurodollar Interest Period. Subject to the terms of Section 2.5, the Borrower
-----------
may elect from time to time to convert all or any part of an Advance of any Type
into any other Type or Types of Advances; provided that any conversion of any
--------
Eurodollar Advance shall be made on, and only on, the last day of the Eurodollar
Interest Period applicable thereto. The Borrower shall give the Agent
irrevocable notice (a "Conversion/Continuation Notice") of each conversion of an
Advance or continuation of a Eurodollar Advance not later than 10:00 a.m.
(Chicago time) at least one Business Day, in the case of a conversion into an
Alternate Base Rate Advance, or at least three Business Days, in the case of a
conversion into or continuation of a Eurodollar Advance, prior to the date of
the requested conversion or continuation, specifying:
(a) the requested date, which shall be a Business Day, of such
conversion or continuation;
(b) the aggregate amount and Type of Advance which is to be converted or
continued; and
(c) the amount and Type(s) of Advance(s) into which such Advance is to be
converted or continued and, in the case of a conversion into or continuation of
an Eurodollar Advance, the duration of the Eurodollar Interest Period applicable
thereto.
2.3. Availability of Funds. Not later than noon (Chicago time) on each
-----------------------
Borrowing Date, each Lender shall make available its Loan or Loans, in funds
immediately available in Chicago to the Agent at its address specified pursuant
to Article XIII. The Agent will make the funds so received from the Lenders
available to the Borrower at the Agent's aforesaid address.
2.4. Commitment Fee; Reductions in Aggregate Commitment.
-------------------------------------------------------
(a) The Borrower agrees to pay to the Agent for the ratable account of
each Lender a commitment fee equal to the Applicable Commitment Fee Percentage
per annum on the daily unborrowed portion of such Lender's Commitment from the
date hereof to and including the Revolving Credit Termination Date, payable in
arrears on each Payment Date hereafter and on the Revolving Credit Termination
Date.
(b) The Borrower may permanently reduce the Aggregate Commitment in whole,
or in part ratably among the Lenders, in a minimum amount of $10,000,000 or any
integral multiple of $1,000,000 in excess thereof, upon at least three Business
Days' written notice to the Agent, which notice shall specify the amount of any
such reduction; provided, however, that the amount of the Aggregate Commitment
-------- -------
may not be reduced below the aggregate principal amount of the outstanding
Loans. All accrued commitment fees shall be payable on the effective date of
any termination of the obligations of the Lenders to make Loans hereunder.
2.5. Minimum Amount of Each Advance. Each Advance shall be in the
----------------------------------
minimum amount of $10,000,000 (and in integral multiples of $1,000,000 if in
excess thereof); provided, however, that (a) any Alternate Base Rate Advance may
-------- -------
be in the amount of the unused Aggregate Commitment and (b) in no event shall
more than six (6) Eurodollar Advances be permitted to be outstanding at any
time.
2.6. Optional Principal Payments. The Borrower may from time to time pay,
---------------------------
without penalty or premium, all outstanding Advances, or, in a minimum aggregate
amount of $5,000,000 or any integral multiple of $1,000,000 in excess
thereof, any portion of the outstanding Advances upon one Business Day's prior
notice to the Agent in the case of an Alternate Base Rate Advance or three
Business Days' prior notice to the Agent in the case of a Eurodollar Advance.
Any prepayment of a Eurodollar Advance prior to the last day of the applicable
Eurodollar Interest Period shall be subject to the indemnity provisions of
Section 3.4.
------------
2.7. Changes in Interest Rate, etc. Each Alternate Base Rate Advance
--------------------------------
shall bear interest at the Alternate Base Rate from and including the date of
such Advance or the date on which such Advance was converted into an Alternate
Base Rate Advance to (but not including) the date on which such Alternate Base
Rate Advance is paid or converted to a Eurodollar Advance. Changes in the rate
of interest on that portion of any Advance maintained as an Alternate Base Rate
Advance will take effect simultaneously with each change in the Alternate Base
Rate. Each Eurodollar Advance shall bear interest from and including the first
day of the Eurodollar Interest Period applicable thereto to, but not including,
the last day of such Eurodollar Interest Period at the interest rate determined
as applicable to such Eurodollar Advance. No Eurodollar Interest Period may end
after the Facility Termination Date.
2.8. Rates Applicable After Default. Notwithstanding anything to the
--------------------------------
contrary contained in Section 2.2.3 and 2.2.4, no Advance may be made as,
-------------- -----
converted into or continued as a Eurodollar Advance (except with the consent of
the Agent and the Required Lenders) when any Default or Unmatured Default has
occurred and is continuing. During the continuance of a Default the Required
Lenders may, at their option, by notice to the Borrower (which notice may be
revoked at the option of the Required Lenders notwithstanding any provision of
Section 8.2 requiring unanimous consent of the Lenders to changes in interest
------------
rates), declare that each Eurodollar Advance and Alternate Base Rate Advance
shall bear interest (for the remainder of the applicable Eurodollar Interest
Period in the case of Eurodollar Advances) at a rate per annum equal to the rate
otherwise applicable plus two percent (2%) per annum; provided, however, that
-------- -------
such increased rate shall automatically and without action of any kind by the
Lenders become and remain applicable until revoked by the Required Lenders in
the event of a Default described in Section 7.6 or 7.7.
------------ ---
2.9. Method of Payment. All payments of the Obligations hereunder shall be
-----------------
made, without setoff, deduction or counterclaim, in immediately available funds
to the Agent at the Agent's address specified pursuant to Article XIII, or at
------------
any other Lending Installation of the Agent specified in writing by the Agent to
the Borrower, by noon (Chicago time) on the date when due and shall be
applied ratably by the Agent among the Lenders. Each payment delivered to the
Agent for the account of any Lender shall be delivered promptly by the Agent to
such Lender in the same type of funds that the Agent received at its address
specified pursuant to Article XIII or at any Lending Installation specified in a
------------
notice received by the Agent from such Lender. The Agent is hereby authorized
to charge the account of the Borrower maintained with Bank One for each payment
of principal, interest and fees as it becomes due hereunder, if the Agent has
provided the Borrower with notice of each such payment at least one day prior to
its becoming due hereunder.
2.10. Notes; Telephonic Notices. Each Lender is hereby authorized to
-------------------------
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Note; provided, however, that neither the failure to so
-------- -------
record nor any error in such recordation shall affect the Borrower's obligations
under such Note. The Borrower hereby authorizes the Lenders and the Agent to
extend, convert or continue Advances, effect selections of Types of Advances and
to transfer funds based on telephonic notices made by any person or persons the
Agent or any Lender in good faith believes to be acting on behalf of the
Borrower. The Borrower agrees to deliver promptly to the Agent a written
confirmation, if such confirmation is requested by the Agent or any Lender, of
each telephonic notice signed by an Authorized Officer or another management
level employee designated in writing by an Authorized Officer to the Agent. If
the written confirmation differs in any material respect from the action taken
by the Agent and the Lenders, the records of the Agent and the Lenders shall
govern absent manifest error.
2.11. Interest Payment Dates; Interest and Fee Basis. Interest accrued on
------------------------------------------------
each Alternate Base Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof, on any date
on which an Alternate Base Rate Advance is prepaid, whether due to acceleration
or otherwise, and at maturity. Interest accrued on each Eurodollar Advance
shall be payable on the last day of its applicable Eurodollar Interest Period,
on any date on which the Eurodollar Advance or Absolute Rate Advance is prepaid,
whether by acceleration or otherwise, and at maturity. Interest accrued on
each Eurodollar Advance having a Eurodollar Interest Period longer than three
months shall also be payable on the last day of each three-month interval during
such Eurodollar Interest Period. Interest and commitment fees shall be
calculated for actual days elapsed on the basis of a 360-day year. Interest
shall be payable for the day an Advance is made but not for the day of any
payment on the amount paid if payment is received prior to noon (Chicago time)
at the place of payment. If any payment of principal of or interest on an
Advance shall become due on a day which is not a Business Day, such payment
shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.
2.12. Notification of Advances, Interest Rates, Prepayments, Commitment
-----------------------------------------------------------------
Reductions and Issuance Requests. Promptly after receipt thereof, the Agent
-----------------------------------
will notify each Lender of the contents of each Aggregate Commitment reduction
notice, Borrowing Notice, Conversion/Continuation Notice and repayment notice
received by it hereunder. The Agent will notify each Lender of the interest
rate applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate.
2.13. Lending Installations. Each Lender may book its Loans at any
----------------------
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written or telex
notice to the Agent and the Borrower, designate a Lending Installation through
which Loans will be made by it and for whose account Loan payments are to be
made.
2.14. Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender,
-----------------------------------
as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (a) in the case of a Lender, the
proceeds of a Loan, or (b) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption.
If the Borrower has not in fact made such payment to the Agent, the Lenders
shall, on demand by the Agent, repay to the Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at a rate per annum equal to the Federal
Funds Effective Rate for such day. If any Lender has not in fact made such
payment to the Agent, such Lender or the Borrower shall, on demand by the Agent,
repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (a) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day, or (b) in the case of payment by the
Borrower, the interest rate applicable to the relevant Loan.
2.15. Taxes.
-----
(a) Any payments made by the Borrower under this Agreement shall be
made free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding net
income taxes and franchise taxes or any other tax based upon any income imposed
on the Agent or any Lender by the jurisdiction in which the Agent or such Lender
is incorporated or has its principal place of business. If any such
non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the Agent or any Lender hereunder, the amounts so payable to the
Agent or such Lender shall be increased to the extent necessary to yield to the
Agent or such Lender (after payment of all Non-Excluded Taxes) interest or any
such other amounts payable hereunder at the rates or in the amounts specified in
or pursuant to this Agreement; provided, however, that the Borrower shall not be
-------- -------
required to increase any such amounts payable to any Lender that is not
organized under the laws of the U.S. or a state thereof if such Lender fails to
comply with the requirements of paragraph (b) of this Section 2.15. Whenever
------------
any Non-Excluded Taxes are payable by the Borrower, as promptly as practicable
thereafter the Borrower shall send to the Agent for its own account or for the
account of such Lender, as the case may be, a certified copy of an original
official receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the Agent and the Lenders for
any incremental taxes, interest or penalties that may become payable by any
Agent or any Lender as a result of any such failure. The agreements in this
Section 2.15 shall survive the termination of this Agreement and the payment of
-------------
all other amounts payable hereunder.
(b) At least five Business Days prior to the first date on which interest or
fees are payable hereunder for the account of any Lender, each Lender that is
not incorporated under the laws of the United States of America, or a state
thereof, agrees that it will deliver to each of the Borrower and the Agent two
duly completed copies of United States Internal Revenue Service Form 1001 or
4224, certifying in either case that such Lender is entitled to receive payments
under this Agreement and the Notes without deduction or withholding of any
United States federal income taxes. Each Lender which so delivers a Form 1001
or 4224 further undertakes to deliver to each of the Borrower and the Agent two
additional copies of such form (or a successor form) on or before the date that
such form expires (currently, three successive calendar years for Form 1001 and
one calendar year for Form 4224) or becomes obsolete or after the occurrence of
any event requiring a change in the most recent forms so delivered by it, and
such amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Agent, in each case certifying that such Lender
is entitled to receive payments under this Agreement and the Notes without
deduction or withholding of any United States federal income taxes, unless an
event (including, without limitation, any change in treaty, law or regulation)
has occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect to it and
such Lender advises the Borrower and the Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.
2.16. Agent's Fees. The Borrower shall pay to the Agent those fees, in
------------
addition to the commitment fees referenced in Section 2.4(a), in the amounts and
--------------
at the times separately agreed to between the Agent and the Borrower.
ARTICLE III
CHANGE IN CIRCUMSTANCES
-----------------------
3.1. Yield Protection. If, after the date hereof, the adoption of or any
-----------------
change in any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
interpretation thereof, or the compliance of any Lender therewith,
(a) subjects any Lender or any applicable Lending Installation to any
tax, duty, charge or withholding on or from payments due from the Borrower
(excluding taxation of the overall net income of any Lender or applicable
Lending Installation imposed by the jurisdiction in which such Lender or Lending
Installation is incorporated or has its principal place of business), or changes
(excluding increases in the income tax rates imposed by the jurisdiction in
which the applicable Lender or Lending Installation is incorporated or has its
principal place of business) the basis of taxation of principal, interest or any
other payments to any Lender or Lending Installation in respect of its Loans or
other amounts due it hereunder, or
(b) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and assessments taken into
account in determining the interest rate applicable to Eurodollar Advances), or
(c) imposes any other condition the result of which is to increase the cost
to any Lender or any applicable Lending Installation of making, funding or
maintaining Loans or reduces any amount receivable by any Lender or any
applicable Lending Installation in connection with any Loans, or requires any
Lender or any applicable Lending Installation to make any payment calculated by
reference to the amount of Loans held or interest received by it, by an amount
deemed material by such Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or resulting in an amount
received which such Lender determines is attributable to making, funding and
maintaining its Loans and its Commitment.
3.2. Changes in Capital Adequacy Regulations. If a Lender determines the
------------------------------------------
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion of such increased capital
which such Lender determines is attributable to this Agreement, its Loans
or its obligation to make Loans (after taking into account such Lender's
policies as to capital adequacy). "Change" means (a) any change after the date
------
of this Agreement in the Risk-Based Capital Guidelines, or (b) any adoption of
or change in any other law, governmental or quasi-governmental rule, regulation,
policy, guideline, interpretation, or directive (whether or not having the force
of law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation
or any corporation controlling any Lender. "Risk-Based Capital Guidelines"
-----------------------------
means (a) the risk-based capital guidelines in effect in the United States on
the date of this Agreement and (b) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the
July 1988 report of the Basle Committee on Banking Regulation and Supervisory
Practices entitled "International Convergence of Capital Measurements and
Capital Standards" and any amendments to such regulations adopted prior to the
date of this Agreement.
3.3. Availability of Types of Advances. If any Lender determines that
----------------------------------
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (a) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available, or (b) the interest rate applicable to a Type of Advance does not
accurately or fairly reflect the cost of making or maintaining such Advance,
then the Agent shall suspend the availability of the affected Type of Advance
until such circumstance no longer exists and require any Eurodollar Advances of
the affected Type to be repaid.
3.4. Funding Indemnification. If any payment of a Eurodollar Advance
------------------------
occurs on a date which is not the last day of the applicable Eurodollar Interest
Period, whether because of acceleration, prepayment or otherwise, or any such
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify the Agent and each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Advance.
3.5. Lender Statements; Survival of Indemnity. To the extent reasonably
---- --------------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1 and 3.2 or to avoid the unavailability of a Type of
------------- ---
Advance under Section 3.3, so long as such designation is not disadvantageous to
-----------
such Lender. Each Lender shall deliver a written statement of such Lender
to the Borrower (with a copy to the Agent) as to the amount due, if any, under
Section 3.1, 3.2 or 3.4. Such written statement shall set forth in reasonable
------------ --- ---
detail the calculations upon which such Lender determined such amount and shall
be final, conclusive and binding on the Borrower in the absence of manifest
error. Determination of amounts payable under such Sections in connection with
a Eurodollar Loan shall be calculated as though each Lender funded its
Eurodollar Loan through the purchase of a deposit of the type and maturity
corresponding to the deposit used as a reference in determining the Eurodollar
Rate applicable to such Loan, whether in fact that is the case or not. Unless
otherwise provided herein, the amount specified in the written statement of any
Lender shall be payable on demand after receipt by the Borrower of the written
statement. The obligations of the Borrower under Sections 3.1, 3.2 and 3.4
------------ --- ---
shall survive payment of the Obligations and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
--------------------
4.1 Initial Loans. The Lenders shall not be required to make the initial
--------------
Advances hereunder unless the Borrower has furnished the following to the Agent
with sufficient copies for the Lenders and the other conditions set forth below
have been satisfied, in each case on or before August 15, 2000:
(a) RHM Acquisition. Copies of the material RHM Acquisition Documents
----------------
and such other information with respect to the RHM Acquisition as the Agent may
reasonably request, which shall be in form and substance satisfactory to the
Agent, and a certificate of the Secretary or President of the Borrower
confirming that all conditions precedent thereunder or otherwise to the
consummation of the RHM Acquisition shall have been satisfied (and not waived in
any material respect) and that the RHM Acquisition has been or is substantially
contemporaneously being consummated.
(b) Charter Documents; Good Standing Certificates. Copies of the
-------------------------------------------------
certificate of incorporation of the Borrower, together with all amendments and
other modifications thereto, certified by the appropriate governmental officer
in its jurisdiction of incorporation, together with a good standing certificate
issued by the Secretary of State of the jurisdiction of its incorporation and
such other jurisdictions as shall be requested by the Agent.
(c) By-Laws and Resolutions. Copies, certified by the Secretary or
-------------------------
Assistant Secretary of the Borrower, of its by-laws and of its Board of
Directors' resolutions authorizing the execution, delivery and performance of
the Loan Documents to which the Borrower is a party.
(d) Secretary's Certificate. An incumbency certificate, executed by the
------------------------
Secretary or Assistant Secretary of the Borrower, which shall identify by name
and title and bear the signature of the officers of the Borrower authorized to
sign the Loan Documents and to make borrowings hereunder, upon which certificate
the Agent and the Lenders shall be entitled to rely until informed of any change
in writing by the Borrower.
(e) Officer's Certificate. A certificate, dated the date hereof, signed by
----------------------
an Authorized Officer of the Borrower, in form and substance satisfactory to the
Agent, to the effect that: (i) on the initial Borrowing Date (both before and
after giving effect to the making of any Loans no Default or Unmatured Default
has occurred and is continuing; (ii) no injunction or temporary restraining
order which would prohibit the making of any Loans or other litigation which
could reasonably be expected to have a Material Adverse Effect is pending or, to
the best of such Person's knowledge, threatened; (iii) each of the
representations and warranties set forth in Article V of this Agreement is true
---------
and correct on and as of the initial Borrowing Date; and (iv) since September
30, 1999, no event or change has occurred that has caused or evidences a
Material Adverse Effect.
(f) Legal Opinions. A written opinion of ▇. ▇. ▇▇▇▇▇▇▇▇, General Counsel
---------------
for the Borrower and the Guarantors, addressed to the Agent and the Lenders in
the form of Exhibit D attached hereto.
----------
(g) Notes. Notes payable to the order of each of the Lenders duly executed
-----
by the Borrower.
(h) Loan Documents. Executed originals of this Agreement and each of the
---------------
Loan Documents, which shall be in full force and effect, together with all
schedules, exhibits, certificates, instruments, opinions, documents and
financial statements required to be delivered pursuant hereto and thereto.
(i) Letters of Direction. Written money transfer instructions with respect
---------------------
to Advances in form and substance acceptable to the Agent and its counsel
addressed to the Agent and signed by an Authorized Officer, together with such
other related money transfer authorizations as the Agent may have reasonably
requested.
(j) Guarantor Charter Documents; Good Standing Certificates. Copies of the
--------------------------------------------------------
articles or certificates of incorporation of each Guarantor, together with all
amendments thereto, both certified by the Secretary or Assistant Secretary of
such Guarantor, together with a good standing certificate issued by the
Secretary of State of the jurisdiction of its incorporation and such other
jurisdictions as shall be requested by the Agent.
(k) Guarantor By-Laws and Resolutions. Copies, certified by the Secretary
-----------------------------------
or Assistant Secretary of each Guarantor, of its by-laws and Board of Directors'
resolutions of such Guarantor (and resolutions of other bodies, if any are
deemed necessary by counsel for the Agent) authorizing the execution, delivery
and performance of the Loan Documents to which each such Guarantor is a party.
(l) Guarantor Secretary's Certificate. An incumbency certificate, executed
----------------------------------
by the Secretary or Assistant Secretary of each Guarantor, which shall identify
by name and title and bear the signature of the officers of such Guarantor
authorized to sign the Loan Documents upon which certificate the Agent and the
Lenders shall be entitled to rely until informed of any change in writing by the
Borrower.
(m) Certificate Under Existing Credit Agreement. A copy of the certificate
--------------------------------------------
executed by the chief financial officer, treasurer or controller of the Borrower
and delivered to Bank One pursuant to Section 6.15(m) of the Existing
Credit Agreement.
(n) Fees. Payment of fees as set forth in that certain commitment letter,
----
dated as of June 15, 2000, between the Agent and the Borrower.
(o) Other. Such other documents as the Agent, any Lender or their counsel
-----
may have reasonably requested.
4.2. Each Future Advance. The Lenders shall not be required to make any
---------------------
Advance unless on the applicable Borrowing Date:
(a) There exists no Default or Unmatured Default and none would result
from such Advance;
(b) The representations and warranties contained in Article V are true and
---------
correct as of such Borrowing Date;
(c) A Borrowing Notice, as applicable, shall have been properly submitted;
and
(d) All legal matters incident to the making of such Advance shall be
satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute a
representation and warranty by the Borrower that the conditions contained in
Section 4.2 have been satisfied. Any Lender may require a duly completed
------------
compliance certificate in substantially the form of Exhibit B hereto as a
---------
condition to making an Advance.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Agent and the Lenders that:
5.1. Corporate Existence and Standing. The Borrower and each Material
---------------------------------
Subsidiary is a corporation duly incorporated, validly existing and in good
standing under the laws of its respective jurisdiction of incorporation and is
duly qualified and in good standing as a foreign corporation and is duly
authorized to conduct its business in each jurisdiction in which its business is
conducted or proposed to be conducted except where the failure to be so
qualified or authorized could not reasonably be expected to have a Material
Adverse Effect.
5.2. Authorization and Validity. The Borrower and each Guarantor have
---------------------------
all requisite power and authority (corporate and otherwise) and legal right to
execute and deliver (or file, as the case may be) each of the Loan Documents to
which it is a party and to perform its obligations thereunder. The execution
and delivery (or filing, as the case may be) by the Borrower and each Guarantor
of the Loan Documents to which it is a party and the performance of their
respective obligations thereunder have been duly authorized by proper corporate
proceedings and the Loan Documents constitute legal, valid and binding
obligations of the Borrower or such Guarantor, as applicable, enforceable
against the Borrower or such Guarantor, as applicable, in accordance with their
terms, except as enforceability may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally or by
general principles of equity.
5.3. Compliance with Laws and Contracts. The Borrower and its
--------------------------------------
Subsidiaries have complied in all material respects with all applicable
statutes, rules, regulations, orders and restrictions of any domestic or foreign
government or any instrumentality or agency thereof, having jurisdiction over
the conduct of their respective businesses or the ownership of their respective
properties, except where the failure to so comply could not reasonably be
expected to have a Material Adverse Effect. Neither the execution and delivery
by the Borrower or any Guarantor of the Loan Documents to which it is a party,
the application of the proceeds of the Loans, the consummation of any
transaction contemplated in the Loan Documents, nor compliance with the
provisions of the Loan Documents will, or at the relevant time did, (a) violate
any law, rule, regulation (including Regulations T, U and X), order, writ,
judgment, injunction, decree or award binding on the Borrower or any Subsidiary
or the Borrower's or any Subsidiary's charter, articles or certificate of
incorporation or by-laws, (b) violate the provisions of or require the approval
or consent of any party to any indenture, instrument or agreement to which the
Borrower or any Subsidiary is a party or is subject, or by which it, or its
property, is bound, or conflict with or constitute a default thereunder, or
result in the creation or imposition of any Lien (other than Liens permitted by,
the Loan Documents) in, of or on the property of the Borrower or any Subsidiary
pursuant to the terms of any such indenture, instrument or agreement, or (c)
require any consent of the stockholders of any Person.
5.4. Governmental Consents. No order, consent, approval,
----------------------
qualification, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, or other action in respect of, Governmental
Authority, or any subdivision thereof, any securities exchange or other Person
is or at the relevant time was required to authorize, or is or at the relevant
time was required in connection with the execution, delivery, consummation or
performance of, or the legality, validity, binding effect or enforceability of,
any of the Loan Documents, the application of the proceeds of the Loans or any
other transaction contemplated in the Loan Documents.
5.5. Financial Statements. The Borrower has heretofore furnished to
---------------------
each of the Lenders (a) the September 30, 1999 audited consolidated financial
statements of the Borrower and its Subsidiaries, and (b) the unaudited
consolidated financial statements of the Borrower and its Subsidiaries through
March 31, 2000 (collectively, the "Financial Statements"). Each of the
---------------------
Financial Statements was prepared in accordance with Agreement Accounting
Principles and fairly presents the consolidated financial condition and
operations of the Borrower and its Subsidiaries at such dates and the
consolidated results of their operations for the respective periods then ended
(except, in the case of such unaudited statements, for normal year-end audit
adjustments).
5.6. Material Adverse Change. Since September 30, 1999, there has been
-----------------------
no change from that reflected in the Financial Statements, in the business,
Property, condition (financial or otherwise) or results of operations of the
Borrower and its Subsidiaries taken as a whole which could reasonably be
expected to have a Material Adverse Effect.
5.7. Taxes. The Borrower and its Subsidiaries have filed or caused to
-----
be filed in correct form all United States federal and applicable foreign, state
and local tax returns and all other tax returns which are required to be filed
and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any Subsidiary, except such taxes, if
any, as are being contested in good faith and as to which adequate reserves have
been provided in accordance with Agreement Accounting Principles and as to which
no Lien exists. No tax liens have been filed and no claims are being asserted
with respect to any such taxes which could reasonably be expected to have a
Material Adverse Effect. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are in accordance with Agreement Accounting Principles.
5.8. Litigation and Contingent Obligations. There is no litigation,
----------------------------------------
arbitration, proceeding, inquiry or governmental investigation (including,
without limitation, by the Federal Trade Commission) pending or, to the
knowledge of any of their officers, threatened against or affecting the Borrower
or any Subsidiary or any of their respective Properties which could reasonably
be expected to have a Material Adverse Effect or to prevent, enjoin or unduly
delay the making of the Loans under this Agreement. Neither the Borrower nor
any Subsidiary has any material Contingent Obligations except as set forth on
Schedule 5.8.
-------------
5.9. Subsidiaries and Capitalization. Schedule 5.9 hereto contains an
-------------------------------- ------------
accurate list of all of the existing Subsidiaries as of the date of this
Agreement, setting forth their respective jurisdictions of incorporation and the
percentage of their capital stock owned by the Borrower or other Subsidiaries.
All of the issued and outstanding shares of capital stock of each Subsidiary
have been duly authorized and validly issued, are fully paid and non-assessable,
and are free and clear of all Liens, other than the Liens created by the Loan
Documents. No authorized but unissued or treasury shares of capital stock of
the Borrower or any Subsidiary are subject to any option, warrant, right to call
or commitment of any kind or character. Except as set forth on Schedule 5.9,
------------
neither the Borrower nor any Subsidiary has any outstanding stock or securities
convertible into or exchangeable for any shares of its capital stock, or any
right issued to any Person (either preemptive or other) to subscribe for or to
purchase, or any options for the purchase of, or any agreements providing for
the issuance (contingent or otherwise) of, or any calls, commitments or claims
of any character relating to any of its capital stock or any stock or securities
convertible into or exchangeable for any of its capital stock other than as
expressly set forth in the certificate or articles of incorporation of the
Borrower or such Subsidiary. Neither the Borrower nor any Subsidiary is subject
to any obligation (contingent or otherwise) to repurchase or otherwise acquire
or retire any shares of its capital stock or any convertible securities, rights
or options of the type described in the preceding sentence except as otherwise
set forth on Schedule 5.9. Except as set forth on Schedule 5.9, as of the date
------------ ------------
hereof the Borrower does not own or hold, directly or indirectly, any capital
stock or equity security of, or any equity or partnership interest in any Person
other than such Subsidiaries and Vail Resorts, Inc.
5.10. ERISA. Except as disclosed on Schedule 5.10, neither the
----- --------------
Borrower nor any other member of the Controlled Group maintains any Single
Employer Plans, and no Single Employer Plan has any Unfunded Liability. Neither
the Borrower nor any other member of the Controlled Group has incurred, or is
reasonably expected to incur, any withdrawal liability to any Multiemployer Plan
which could reasonably be expected to have a Material Adverse Effect. Each Plan
complies in all respects with all applicable requirements of law and
regulations, except where the failure to so comply could not reasonably be
expected to cause the relevant Plan to become disqualified under the Code.
Neither the Borrower nor any member of the Controlled Group has, with respect to
any Plan, failed to make any contribution or pay any amount required under
Section 412 of the Code or Section 302 of ERISA or the terms of such Plan.
There are no pending or, to the knowledge of the Borrower, threatened claims,
actions, investigations or lawsuits against any Plan, any fiduciary thereof, or
the Borrower or any member of the Controlled Group with respect to a Plan which
could reasonably be expected to have a Material Adverse Effect. Neither the
Borrower nor any member of the Controlled Group has engaged in any prohibited
transaction (as defined in Section 4975 of the Code or Section 406 of ERISA) in
connection with any Plan which would subject such Person to any material
liability. Within the last five years neither the Borrower nor any member of
the Controlled Group has engaged in a transaction which resulted in a Single
Employer Plan with an Unfunded Liability being transferred out of the Controlled
Group. No Termination Event has occurred or is reasonably expected to occur
with respect to any Plan which is subject to Title IV of ERISA.
5.11. Defaults. No Default or Unmatured Default has occurred and is
--------
continuing.
5.12. Federal Reserve Regulations. Neither the Borrower nor any
-----------------------------
Subsidiary is engaged, directly or indirectly, principally, or as one of its
important activities, in the business of extending, or arranging for the
extension of, credit for the purpose of purchasing or carrying Margin Stock.
Neither the making of any Advance hereunder, nor the use of the proceeds thereof
will violate or be inconsistent with the provisions of Regulation T, Regulation
U or Regulation X. Following the application of the proceeds of the Loans, less
than 25% of the value (as determined by any reasonable method) of the assets of
the Borrower and its Subsidiaries which are subject to any limitation on sale,
pledge, or other restriction hereunder taken as a whole have been, and will
continue to be, represented by Margin Stock.
5.13. Investment Company; Public Utility Holding Company Act. Neither
-------------------------------------------------------
the Borrower nor any Subsidiary is, or after giving effect to any Advance will
be, an "investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended. Neither
the Borrower nor any Subsidiary is a "holding company" or a "subsidiary company"
of a "holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
5.14. Certain Fees. Other than as disclosed on Schedule 5.14, no
------------- -------------
broker's or finder's fee or commission was, is or will be payable by the
Borrower or any Subsidiary with respect to the transactions contemplated by this
Agreement. The Borrower hereby agrees to indemnify the Agent and the Lenders
against and agrees that it will hold each of them harmless from any claim,
demand or liability for broker's or finder's fees or commissions alleged to have
been incurred by the Borrower in connection with any of the transactions
contemplated by this Agreement and any expenses (including, without limitation,
attorneys' fees and time charges of attorneys for the Agent or any Lender, which
attorneys may be employees of the Agent or any Lender) arising in connection
with any such claim, demand or liability.
5.15. Solvency. As of the date hereof, after giving effect to the
--------
consummation of the transactions contemplated by the Loan Documents and the
payment of all fees, costs and expenses payable by the Borrower or its
Subsidiaries with respect to the transactions contemplated by the Loan
Documents, each of the Borrower and each Guarantor is Solvent.
5.16. Ownership of Properties. Except as set forth on Schedule 5.16
------------------------- -------------
hereto, the Borrower and its Subsidiaries have a subsisting leasehold interest
in, or good and marketable title, free of all Liens, other than those permitted
by Section 6.17 or by any of the other Loan Documents, to all of the properties
------------
and assets reflected in the Financial Statements as being owned by it, except
for assets sold, transferred or otherwise disposed of in the ordinary course of
business since the date thereof. To the knowledge of the Borrower, there are no
actual, threatened or alleged defaults with respect to any leases of real
property under which the Borrower or any Subsidiary is lessee or lessor which
could reasonably be expected to have a Material Adverse Effect. The Borrower
and its Subsidiaries own or possess rights to use all material licenses,
patents, patent applications, copyrights, service marks, trademarks and trade
names necessary to continue to conduct their business as heretofore conducted,
and no such license, patent or trademark has been declared invalid, been limited
by order of any court or by agreement or is the subject of any infringement,
interference or similar proceeding or challenge, except for proceedings and
challenges which could not reasonably be expected to have a Material Adverse
Effect.
5.17. Indebtedness. Attached hereto as Schedule 5.17 is a complete and
------------ -------------
correct list of all Indebtedness of the Borrower and its Subsidiaries
outstanding on the date of this Agreement (other than Indebtedness in a
principal amount not exceeding $100,000 for a single item of Indebtedness and
$500,000 in the aggregate for all such Indebtedness listed), showing the
aggregate principal amount which was outstanding on such date.
5.18. Subordinated Indebtedness. The principal of and interest on the
--------------------------
Notes and all other Obligations will constitute "senior debt" as that or any
similar term is or may be used in any other instrument evidencing or applicable
to any Subordinated Indebtedness of the Borrower.
5.19. Employee Controversies. There are no strikes, work stoppages or
-----------------------
controversies pending or threatened between the Borrower or any Subsidiary and
any of its employees, other than strikes, work stoppages or controversies
arising in the ordinary course of business, which, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
5.20. Material Agreements. Neither the Borrower nor any Subsidiary is
--------------------
a party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect or which restricts or imposes conditions upon the ability of the
Borrower or any Subsidiary to (a) pay dividends or make other distributions on
its capital stock (b) make loans or advances to the Borrower, (c) repay loans or
advances from Borrower or (d) grant Liens to the Agent to secure the
Obligations. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect.
5.21. Environmental Laws. The Borrower and its Material Subsidiaries
-------------------
each conduct in the ordinary course of business a review of the effects of then
existing Environmental Laws and then existing Environmental Claims on its
business, condition (financial and other), results of operations and Property,
and as a result thereof the Borrower and its Material Subsidiaries have
reasonably concluded that the application of such Environmental Laws and the
existence of such Environmental Claims, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect.
5.22. Insurance. The Borrower and its Subsidiaries maintain with
---------
financially sound and reputable insurance companies insurance on their Property
in such amounts and covering such risks as is consistent with sound business
practice.
5.23. Disclosure. None of the (a) information, exhibits or reports
----------
furnished or to be furnished by the Borrower or any Subsidiary to the Agent or
to any Lender in connection with the negotiation of the Loan Documents, or (b)
representations or warranties of the Borrower or any Subsidiary contained in
this Agreement, the other Loan Documents or any certificate or other written
information furnished to the Agent or the Lenders by or on behalf of the
Borrower or any Subsidiary pursuant to a request from the Agent or the Lenders
permitted hereunder and for use in connection with the transactions contemplated
by this Agreement, contained, contains or will contain any untrue statement
of a material fact or omitted, omits or will omit to state a material fact
necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made. The pro
forma financial information contained in such materials is based upon good faith
estimates and assumptions believed by the Borrower to be reasonable at the time
made. There is no fact known to the Borrower (other than matters of a general
economic nature) that has had or could reasonably be expected to have a Material
Adverse Effect and that has not been disclosed herein or in such other
documents, certificates and other written information furnished to the Lenders
for use in connection with the transactions contemplated by this Agreement.
5.24. Acquisition. The Borrower has delivered to the Agent true,
-----------
complete and correct copies of the RHM Acquisition Documents (including all
schedules, exhibits, annexes, amendments, supplements, modifications and all
other documents delivered pursuant thereto or in connection therewith). The RHM
Acquisition Documents as originally executed and delivered by the parties
thereto have not been amended, waived, supplemented or modified in any material
respect without the consent of the Agent. The representations and warranties of
the Borrower set forth therein and, to the knowledge of the Borrower, the
representations and warranties of the other parties set forth therein are true
and correct in all material respects as of the date thereof. On the date of
this Agreement, neither the Borrower nor any other party to any of the RHM
Acquisition Documents is in default in the performance of or compliance with any
provisions under the RHM Acquisition Documents. The RHM Acquisition has been
consummated or is being consummated substantially contemporaneously with the
execution of this Agreement and in accordance with applicable laws and
regulations.
ARTICLE VI
COVENANTS
---------
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself and
--------------------
each Subsidiary, a system of accounting established and administered in
accordance with generally accepted accounting principles, consistently applied,
and furnish to the Lenders:
(a) As soon as practicable and in any event within 95 days after the
close of each of its Fiscal Years, an unqualified audit report certified by
independent certified public accountants, acceptable to the Lenders, prepared in
accordance with Agreement Accounting Principles on a consolidated and
consolidating basis (consolidating statements need not be certified by such
accountants) for itself and its Subsidiaries, including balance sheets as of the
end of such period and related statements of income, retained earnings and cash
flows (but not consolidating statements of retained earnings or cash flows)
accompanied by a certificate of said accountants that, in the course of the
examination necessary for their certification of the foregoing, they have
obtained no knowledge of Default or Unmatured Default, or if, in the opinion of
such accountants, any Default or Unmatured Default shall exist, stating the
nature and status thereof.
(b) As soon as practicable and in any event within 50 days after the close
of the first three Fiscal Quarters of each of its Fiscal Years, for itself and
its Subsidiaries, consolidated and consolidating unaudited balance sheets as at
the close of each such period and consolidated and consolidating statements of
income, retained earnings and cash flows (but not consolidating statements of
retained earnings or cash flows)for the period from the beginning of such Fiscal
Year to the end of such quarter, all certified by its chief financial officer,
controller or treasurer.
(c) As soon as available, but in any event not later than the last Business
Day in November of each year, a copy of the plan and forecast of the Borrowers,
and its Subsidiaries for the next Fiscal Year organized by individual lines of
business (including a projected consolidated and consolidating balance sheet,
income statement and funds flow statement).
(d) Together with the financial statements required by clauses (a) and (b)
----------- ---
above, a compliance certificate in substantially the form of Exhibit B hereto
---------
signed by its chief financial officer, controller or treasurer showing the
calculations necessary to determine compliance with this Agreement and stating
that no Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof.
(e) Within 270 days after the close of each Fiscal Year, a statement of the
Unfunded Liabilities of each Single Employer Plan, certified as correct by an
actuary enrolled under ERISA.
(f) As soon as possible and in any event within 10 days after the Borrower
knows that any Termination Event has occurred with respect to any Plan, a
statement, signed by the chief financial officer, treasurer or controller of the
Borrower, describing said Termination Event and the action which the Borrower
proposes to take with respect thereto.
(g) As soon as possible and in any event within 10 days after the Borrower
learns thereof, notice of the assertion or commencement of any claims, action,
suit or proceeding against or affecting the Company or any Subsidiary which
could reasonably be expected to have a Material Adverse Effect.
(h) Promptly upon the furnishing thereof to the shareholders of the
Borrower, copies of all financial statements, reports and proxy statements so
furnished.
(i) Promptly upon the filing thereof, copies of all registration statements
and annual, quarterly, monthly or other regular reports which the Borrower or
any of its Subsidiaries files with the Securities and Exchange Commission.
(j) Such other information (including non-financial information) as the
Agent or any Lender may from time to time reasonably request.
6.2. Use of Proceeds. The Borrower will, and will cause each
-----------------
Subsidiary to, use the proceeds of the Advances to meet the general corporate
and working capital needs of the Borrower and its Subsidiaries, including the
making of stock redemptions and repurchases, dividends on its capital stock, the
RHM Acquisition, Investments and non-hostile Purchases, all as permitted
hereunder. The Borrower will not, nor will it permit any Subsidiary to, use any
of the proceeds of the Advances to purchase or carry any "margin stock" (as
defined in Regulation U) or to finance the Purchase of any Person which has not
been approved and recommended by the board of directors (or functional
equivalent thereof) of such Person.
6.3. Notice of Default. The Borrower will give prompt notice in
--------------------
writing to the Lenders of the occurrence of (a) any Default or Unmatured Default
and (b) of any other event or development, financial or other, relating
specifically to the Borrower or any of its Subsidiaries (and not of a general
economic or political nature) which could reasonably be expected to have a
Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
---------------------
Subsidiary to, carry on and conduct its business in substantially the same
manner as is presently conducted or in other consumer products markets and the
manufacturing of ingredients therefor, and to do all things necessary to remain
duly incorporated, validly existing and in good standing as a domestic
corporation in its jurisdiction of incorporation and maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted, except where the failure to maintain such authority could not
reasonably be expected to have a Material Adverse Effect.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to,
-----
timely file complete and correct United States federal and applicable foreign,
state and local tax returns required by applicable law and pay when due all
material taxes, assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
---------
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice for similarly situated businesses in the industries in
which the Borrower and its Subsidiaries operate, and the Borrower will furnish
to the Agent and any Lender upon request full information as to the insurance
carried.
6.7. Compliance with Laws. The Borrower will, and will cause each
----------------------
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, the
failure to comply with which could reasonably be expected to have a Material
Adverse Effect.
6.8. Maintenance of Properties. The Borrower will, and will cause each
-------------------------
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times, except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
6.9. Inspection. The Borrower will, and will cause each Subsidiary to,
----------
permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, corporate books and financial records of
the Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each Subsidiary, and to
discuss the affairs, finances and accounts of the Borrower and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Lenders may designate. The Borrower will
keep or cause to be kept, and cause each Subsidiary to keep or cause to be kept,
appropriate records and books of account in which complete entries are to be
made reflecting its and their business and financial transactions, such entries
to be made in accordance with Agreement Accounting Principles consistently
applied.
6.10. Capital Stock and Dividends. The Borrower will not, nor will it
----------------------------
permit any Subsidiary to, (a) issue or have outstanding any preferred stock,
other than preferred stock not having mandatory redemption, retirement and other
repurchase dates commencing less than 91 days after the Facility Termination
Date then in effect or (b) declare or pay any dividends or make any
distributions on its capital stock (other than dividends payable in its own
capital stock) or redeem, repurchase or otherwise acquire or retire any of its
capital stock or any options or other rights in respect thereof at any time
outstanding, except that (i) any Subsidiary may declare and pay dividends or
make distributions to the Borrower or to a Guarantor, (ii) so long as no Default
or Unmatured Default exists before or after giving effect to the declaration or
payment of such dividends or repurchase or redemption of such stock, the
Borrower may repurchase or redeem its capital stock or declare and, within 45
days thereafter, pay dividends on its capital stock in an amount which, when
added to the amount of all prior dividends and stock repurchases or redemptions
from and after the date hereof does not exceed 20% of Net Worth at such time
(before giving effect to such dividend, repurchase or redemption).
6.11. Indebtedness. The Borrower will not, nor will it permit any
------------
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(a) the Loans;
(b) Indebtedness existing on the date hereof and described in Schedule 5.17;
-------------
(c) Contingent Obligations permitted by Section 6.16;
-------------
(d) Rate-Hedging Obligations incurred in the ordinary course of business;
(e) Indebtedness arising in connection with the Accounts Receivable
Financing Program;
(f) Indebtedness pursuant to the Existing Credit Agreement; and
(g) other Indebtedness so long as immediately after giving effect to
the incurrence of such Indebtedness, the Borrower is in compliance with the
financial covenants set forth in Section 6.24.
-------------
6.12. Merger. The Borrower will not, nor will it permit any Subsidiary
------
to, merge or consolidate with or into any other Person, except that (a) a
Wholly-Owned Subsidiary may merge into the Borrower or any Wholly-Owned
Subsidiary of the Borrower, (b) the Borrower or any Subsidiary may merge or
consolidate with any other Person so long as the Borrower or such Subsidiary is
the continuing or surviving corporation and, prior to and after giving effect to
such merger or consolidation, no Default or Unmatured Default shall exist, and
(c) any Subsidiary may enter into a merger or consolidation as a means of
effecting a disposition permitted by Section 6.13.
-------------
6.13. Sale of Assets. The Borrower will not, nor will it permit any
----------------
Subsidiary to, lease, sell, transfer or otherwise dispose of its Property to any
other Person except for (a) sales of inventory or unused or obsolete equipment
in the ordinary course of business, and (b) leases, sales, transfers or other
dispositions of its Property that, together with all other Property of the
Borrower and its Subsidiaries previously leased, sold, transferred or otherwise
disposed of (other than inventory or unused or obsolete equipment sold in the
ordinary course of business and accounts receivables transactions permitted by
Section 6.14) as permitted by this Section 6.13 since the date hereof, do not
------------- ------------
constitute a Substantial Portion of the Property of Borrower and its
Subsidiaries.
6.14. Sale of Accounts. The Borrower will not, nor will it permit any
-----------------
Subsidiary to, sell or otherwise dispose of any notes receivable or accounts
receivable, with or without recourse, except that the Borrower or any Subsidiary
may sell or otherwise grant an interest in its accounts receivable to other
Persons, in each case pursuant to an Accounts Receivable Financing Program;
provided, however, that any such sales or granting of interests in accounts
-------- -------
receivable shall, for all purposes of this Agreement, and regardless of the
treatment thereof by the Borrower on its financial statements, be deemed an
incurrence of Indebtedness.
6.15. Investments and Purchases. The Borrower will not, nor will it
---------------------------
permit any Subsidiary to, make or suffer to exist any Investments (including,
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to become
or remain a partner in any partnership or joint venture, or to make any
Purchases, except:
(a) Short-term obligations of, or fully guaranteed by, the United
States of America and short-term obligations of United States government
agencies;
(b) Commercial paper rated A-1 or better by S&P or P-1 or better by ▇▇▇▇▇'▇;
(c) Demand deposit and money market bank accounts maintained in the ordinary
course of business with commercial banks which are members of the Federal
Deposit Insurance Corporation;
(d) Bankers acceptances and certificates of deposit issued by and time
deposits with commercial banks (whether domestic or foreign) rated B or better
by Thomson, A or better by S&P or A2 or better by ▇▇▇▇▇'▇;
(e) Repurchase agreements with commercial banks (whether domestic or
foreign) rated B or better by Thomson, A or better by S&P or A2 or better by
▇▇▇▇▇'▇, so long at least 102% of the principal amount of each repurchase
agreement is collateralized by obligations of, or fully guaranteed by, the
United States of America or by commercial paper rated A-1 or better by S&P or
P-1 or better by ▇▇▇▇▇'▇;
(f) Loan participations and master notes with corporations rated A-1 or
better by S&P or P-1 or better by ▇▇▇▇▇'▇ and with commercial banks rated B or
better by Thomson, A or better by S&P or A2 or better by ▇▇▇▇▇'▇;
(g) Money market preferred stock accounts in corporations rated A or better
by S&P or A2 or better by ▇▇▇▇▇'▇ or in other corporations so long as such
Investments are secured by Letters of Credit issued by commercial banks rated B
or better by Thomson, A or better by S&P or A2 or better by ▇▇▇▇▇'▇;
(h) Existing Investments in Subsidiaries and additional Investments in
Guarantors;
(i) Other Investments in existence on the date hereof and described in
Schedule 6.15 hereto;
---------
(j) Other Investments in Persons or Subsidiaries which are not Guarantors
(including, without limitation, (i) any Investment in a joint venture and (ii)
the creation of and the Investment in any Subsidiary that is not a Guarantor) in
an aggregate amount not exceeding $20,000,000;
(k) Investments in, and the creation of, any special purpose Subsidiary
created for the purpose of entering into the Accounts Receivable Financing
Program;
(l) Additional equity Investments in Vail Resorts, Inc. necessary to permit
the Borrower to retain equity accounting treatment for such Investment;
(m) The RHM Acquisition; and
(n) (i) Purchases not exceeding $15,000,000 in the case of any single
Purchase or series of related Purchases, provided that there shall exist no
--------
Default or Unmatured Default either immediately before or immediately after
giving effect to any such Purchase, or (ii) Purchases in excess of $15,000,000
in the case of any single Purchase or series of related Purchases, provided
--------
that (A) there shall exist no Default or Unmatured Default either immediately
before or immediately after giving effect to any such Purchases and (B) the
Borrower submits a certificate executed by the chief financial officer,
treasurer or controller of the Borrower prior to closing any such transaction
showing that the pro forma Leverage Ratio calculated after giving effect to such
transaction for the period consisting of the four consecutive Fiscal Quarters
then most recently ended (treating such Purchase as having occurred on the first
day of such four-quarter period) does not exceed 2.50:1.
6.16. Contingent Obligations. The Borrower will not, nor will it
-----------------------
permit any Subsidiary to, make or suffer to exist any Contingent Obligation
(including, without limitation, any Contingent Obligation with respect to the
obligations of a Subsidiary), except (a) by endorsement of instruments for
deposit or collection in the ordinary course of business, (b) the Subsidiary
Guaranty and (c) the ▇▇▇▇▇▇▇ Obligations.
6.17. Liens. The Borrower will not, nor will it permit any Subsidiary
-----
to, create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(a) Liens for taxes, assessments or governmental charges or levies on
its Property if the same shall not at the time be delinquent or thereafter can
be paid without penalty, or are being contested in good faith and by appropriate
proceedings and for which adequate reserves in accordance with generally
accepted principles of accounting shall have been set aside on its books;
(b) Liens imposed by law, such as carriers', warehousemen's and mechanics'
liens and other similar liens arising in the ordinary course of business which
secure the payment of obligations not more than 60 days past due or which are
being contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on its books;
(c) Liens arising out of pledges or deposits under worker's compensation
laws, unemployment insurance, old age pensions, or other social security or
retirement benefits, or similar legislation;
(d) Liens arising out of good faith deposits in connection with or to secure
performance of statutory obligations, surety and appeal bonds, government
contracts, leases otherwise permitted hereunder, performance and return of money
bonds and other similar obligations incurred in the ordinary course of business;
(e) Easements, minor defects or irregularities in title, building
restrictions and such other encumbrances or charges against real property, all
of which as are of a nature generally existing with respect to properties of a
similar character and which do not in any material way affect the marketability
of the same or interfere with the use thereof in the business of the Borrower or
the Subsidiaries;
(f) Liens existing on the date hereof and described in Schedule 6.17 hereto,
-------------
including extensions, renewals and replacements thereof in whole or in part, so
long as the principal amount of the Indebtedness secured thereby at the time of
such extension, renewal or replacement is limited to all or any part of the
Property (including improvements thereon) securing the Lien so extended, renewed
or replaced;
(g) Liens on the Property of a Subsidiary of the Borrower and exclusively
securing Indebtedness of such Subsidiary to the Borrower or any Guarantor;
(h) Liens of purchasers or providers of financing under an Accounts
Receivable Financing Program in accordance with Section 6.14 herein;
-------------
(i) Liens securing Indebtedness under the Existing Credit Agreement;
provided that such Liens shall equally and ratably secure the Obligations; and
(j) Other Liens securing aggregate principal Indebtedness at no time
exceeding $25,000,000.
6.18. Lease Rentals. The Borrower will not, nor will it permit any
--------------
Subsidiary to, create, incur or suffer to exist obligations for Rentals in
excess of $30,000,000 during any one Fiscal Year on a non-cumulative basis in
the aggregate for the Borrower and its Subsidiaries.
6.19. Affiliates. The Borrower will not, and will not permit any
----------
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except (a) in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arms-length transaction, (b) transactions among the Borrower and
Guarantors and (c) in connection with the Accounts Receivable Financing Program.
6.20. Subordinated Indebtedness; Other Indebtedness. The Borrower will
---------------------------------------------
not, and will not permit any Subsidiary to, make any amendment or modification
to the indenture, note or other agreement evidencing or governing any
Subordinated Indebtedness, or directly or indirectly voluntarily prepay, defease
or in substance defease, purchase, redeem, retire or otherwise acquire, any
Subordinated Indebtedness.
6.21. Environmental Matters. The Borrower shall and shall cause each
----------------------
of its Material Subsidiaries to conduct in the ordinary course of its business
reviews of the effects of then existing Environmental Laws and then existing
Environmental Claims on its business, condition (financial and other), results
of operations and Property and to take all actions required by such
Environmental Laws and in respect of such Environmental Claims, except where the
failure to so act could not reasonably be expected to have a Material Adverse
Effect.
6.22. Change in Corporate Structure; Fiscal Year. The Borrower shall
--------------------------------------------
not, nor shall it permit any Subsidiary to, (a) permit any amendment or
modification to be made to its certificate or articles of incorporation or
by-laws which is materially adverse to the interests of the Lenders or (b)
change its Fiscal Year to end on any date other than September 30 of each year.
6.23. Inconsistent Agreements. Other than the Existing Credit
------------------------
Agreement, the Borrower shall not, nor shall it permit any Subsidiary to, enter
into any indenture, agreement, instrument or other arrangement which, (a)
directly or indirectly prohibits or restrains, or has the effect of prohibiting
or restraining, or imposes materially adverse conditions upon, the incurrence of
the Obligations, the granting of Liens to secure the Obligations, the provision
of the Subsidiary Guaranty, the amending of the Loan Documents or the ability of
any Subsidiary (other than a special purpose Subsidiary created for the purpose
of entering into the Accounts Receivable Financing Program) to (i) pay dividends
or make other distributions on its capital stock, (ii) make loans or advances to
the Borrower or (iii) repay loans or advances from the Borrower or (b) contains
any provision which would be violated or breached by the making of Advances or
by the performance by the Borrower or any Subsidiary of any of its obligations
under any Loan Document. The Borrower will promptly notify the Agent of any
amendments, modification or waiver of the Existing Credit Agreement and, if
requested to do so by the Agent, will promptly enter into a similar amendment,
modification or waiver of this Agreement.
6.24. Financial Covenants. The Borrower on a consolidated basis with
--------------------
its Subsidiaries shall:
6.24.1. Adjusted Net Worth. At all times after the date hereof,
------------------
maintain a minimum Adjusted Net Worth at least equal to the sum of (a)
$193,300,000, plus (b) the sum of all cash proceeds (net of related costs,
----
expenses, fees and taxes) received by the Borrower or any Subsidiary of the
Borrower from the issuance of its capital stock, plus (c) for each Fiscal
----
Quarter ending after the date of the Existing Credit Agreement and prior to the
time of determination, 50% of the Borrower's positive Adjusted Net Income for
such Fiscal Quarter.
6.24.2. Leverage Ratio. As of the end of each Fiscal Quarter,
---------------
maintain a Leverage Ratio of not more than 3.00:1.00
6.24.3. Interest Expense Coverage Ratio. As of the end of each four
--------------------------------
Fiscal Quarters ending after the date hereof, maintain an Interest Expense
Coverage Ratio of not less than 3.00:1.00
6.25. ERISA Compliance.
-----------------
With respect to any Plan, neither the Borrower nor any Subsidiary shall:
(a) engage in any "prohibited transaction" (as such term is defined in
Section 406 of ERISA or Section 4975 of the Code) for which a civil penalty
pursuant to Section 502(i) of ERISA or a tax pursuant to Section 4975 of the
Code in excess of $2,000,000 could be imposed;
(b) incur any "accumulated funding deficiency" (as such term is defined in
Section 302 of ERISA) in excess of $2,000,000, whether or not waived, or permit
any Unfunded Liability to exceed $2,000,000;
(c) permit the occurrence of any Termination Event which could result in a
liability to the Borrower or any other member of the Controlled Group in excess
of $2,000,000; or
(d) permit the establishment or amendment of any Plan or fail to comply with
the applicable provisions of ERISA and the Code with respect to any Plan which
could result in liability to the Borrower or any other member of the Controlled
Group which, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.
6.26. Material Subsidiaries. The Borrower shall cause each of its
----------------------
Subsidiaries which becomes a Material Subsidiary on or after the date hereof to
join the Subsidiary Guaranty as a Guarantor pursuant to a joinder agreement in
the form attached to the Subsidiary Guaranty within thirty (30) days of such
Person becoming a Material Subsidiary.
ARTICLE VII
DEFAULTS
--------
The occurrence of any one or more of the following events shall constitute
a Default:
7.1. Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders or the Agent under or
in connection with this Agreement, any other Loan Document, any Loan or any
certificate or information delivered in connection with this Agreement or any
other Loan Document shall be false in any material respect on the date as of
which made or deemed made.
7.2. Nonpayment of (a) any principal of any Note when due, or (b) any
interest upon any Note or any commitment fee or other fee or obligations under
any of the Loan Documents within five days after the same becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Section 6.2, Section 6.3(a) or Sections 6.10 through 6.24.
------------ --------------- -------------- ----
7.4. The breach by the Borrower (other than a breach which constitutes
a Default under Section 7.1, 7.2 or 7.3) of any of the terms or provisions of
----------- --- ---
this Agreement which is not remedied within thirty (30) days after written
notice from the Agent or any Lender.
7.5. Failure of the Borrower or any of its Subsidiaries to pay any
Indebtedness aggregating in excess of $25,000,000 when due; or the default by
the Borrower or any of its Subsidiaries in the performance of any term,
provision or condition contained in any agreement or agreements under which any
such Indebtedness was created or is governed, or the occurrence of any other
event or existence of any other condition, the effect of any of which is to
cause, or to permit the holder or holders of such Indebtedness to cause, such
Indebtedness to become due prior to its stated maturity; or any such
Indebtedness of the Borrower or any of its Subsidiaries shall be declared to be
due and payable or required to be prepaid (other than by a regularly scheduled
payment) prior to the stated maturity thereof.
7.6. The Borrower or any of its Subsidiaries shall (a) have an order
for relief entered with respect to it under the Federal bankruptcy laws as now
or hereafter in effect, (b) make an assignment for the benefit of creditors, (c)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (d) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (e)
take any corporate action to authorize or effect any of the foregoing actions
set forth in this Section 7.6, (f) fail to contest in good faith any appointment
-----------
or proceeding described in Section 7.7 or (g) become unable to pay, not pay, or
-----------
admit in writing its inability to pay, its debts generally as they become due.
7.7. Without the application, approval or consent of the Borrower or
any of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section 7.6(d)
--------------
shall be instituted against the Borrower or any of its Subsidiaries and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of thirty consecutive days.
7.8. Any court, government or governmental agency shall condemn, seize
or otherwise appropriate, or take custody or control of (each a "Condemnation"),
------------
all or any portion of the Property of the Borrower and its Subsidiaries which,
when taken together with all other Property of the Borrower and its Subsidiaries
so condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such Condemnation occurs,
constitutes a Substantial Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within thirty
days to pay, bond or otherwise discharge any judgments or orders for the payment
of an aggregate amount in excess of $10,000,000, which is not covered by
undisputed insurance or stayed on appeal or otherwise being appropriately
contested in good faith and as to which no enforcement actions have been
commenced.
7.10. Any Change in Control shall occur.
7.11. The Subsidiary Guaranty shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of the Subsidiary Guaranty, or any Guarantor shall fail to
comply with any of the terms or provisions of the Subsidiary Guaranty, or any
Guarantor denies that it has any further liability under the Subsidiary
Guaranty, or gives notice to such effect.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1. Acceleration. If any Default described in Section 7.6 or 7.7
------------ ----------- ---
occurs with respect to the Borrower, the obligations of the Lenders to make
Loans hereunder shall automatically terminate and the Obligations shall
immediately become due and payable without any election or action on the part of
the Agent or any Lender. If any other Default occurs, the Required Lenders (or
the Agent with the consent of the Required Lenders) may terminate or suspend the
obligations of the Lenders to make Loans hereunder, or declare the Obligations
to be due and payable, or both, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives.
If, within ten Business Days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans
hereunder as a result of any Default (other than any Default as described in
Section 7.6 or 7.7 with respect to the Borrower) and before any judgment or
------------ ---
decree for the payment of the Obligations due shall have been obtained or
entered, the Required Lenders (in their sole discretion) shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such acceleration
and/or termination.
8.2. Amendments. Subject to the provisions of this Article VIII, the
---------- ------------
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
-------- -------
without the consent of each Lender:
(a) Extend the final maturity of any Loan or Note or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest or fees thereon;
(b) Reduce the percentage specified in the definition of Required Lenders;
(c) Reduce the amount of or extend the date for the mandatory payments
required under Section 2.1.2 or increase the amount of the Commitment of any
--------------
Lender hereunder;
(d) Subject to Section 2.1.4, extend the Facility Termination Date;
--------------
(e) Amend this Section 8.2;
------------
(f) Release any Guarantor from the Subsidiary Guaranty; or
(g) Permit any assignment by the Borrower of its Obligations or its
rights hereunder.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of the fee required under Section 12.3.2 without obtaining the consent of any
--------------
other party to this Agreement.
8.3. Preservation of Rights. No delay or omission of the Lenders or
------------------------
the Agent to exercise any right under the Loan Documents shall impair such right
or be construed to be a waiver of any Default or an acquiescence therein, and
the making of a Loan notwithstanding the existence of a Default or the inability
of the Borrower to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
-----------
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Agent and the Lenders until the Obligations have been paid in
full.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1. Survival of Representations. All representations and warranties
-----------------------------
of the Borrower contained in this Agreement or of the Borrower or any Subsidiary
contained in any Loan Document shall survive delivery of the Notes and the
making of the Loans herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to
------------------------
the contrary notwithstanding, no Lender shall be obligated to extend credit to
the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Taxes. Any stamp, documentary or similar taxes, assessments or
-----
charges payable or ruled payable by any governmental authority in respect of the
Loan Documents shall be paid by the Borrower, together with interest and
penalties, if any.
9.4. Headings. Section headings in the Loan Documents are for
--------
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
9.5. Entire Agreement. The Loan Documents embody the entire agreement
-----------------
and understanding among the Borrower, the Agent and the Lenders and supersede
all prior agreements and understandings among the Borrower, the Agent, and the
Lenders relating to the subject matter thereof other than the fee letter dated
June 15, 2000 in favor of Bank One.
9.6. Several Obligations; Benefits of this Agreement. The respective
-------------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any
of its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns.
9.7. Expenses; Indemnification. The Borrower shall reimburse the Agent
-------------------------
and the Arranger for any costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the Agent and the
Arranger, which attorneys may be employees of the Agent or the Arranger) paid or
incurred by the Agent or the Arranger in connection with the preparation,
negotiation, execution, delivery, review, amendment, modification, syndication
and administration of the Loan Documents. The Borrower also agrees to reimburse
the Agent, the Arranger and the Lenders for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time charges of attorneys
for the Agent, the Arranger and the Lenders, which attorneys may be employees of
the Agent, the Arranger or the Lenders) paid or incurred by the Agent, the
Arranger or any Lender in connection with the collection and enforcement of the
Loan Documents. The Borrower further agrees to indemnify the Agent, the
Arranger and each Lender, its directors, officers and employees against all
losses, claims, damages, penalties, judgments, liabilities and expenses
(including, without limitation, all expenses of litigation or preparation
therefor whether or not the Agent, the Arranger or any Lender is a party
thereto) which any of them may pay or incur arising out of or relating to this
Agreement, the other Loan Documents, the transactions contemplated hereby or
thereby or the direct or indirect application or proposed application of the
proceeds of any Loan hereunder, except to the extent that they arise out of the
gross negligence or willful misconduct of the party seeking indemnification.
The obligations of the Borrower under this Section shall survive the termination
of this Agreement.
9.8. Numbers of Documents. All statements, notices, closing documents,
--------------------
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders.
9.9. Accounting. Except as provided to the contrary herein, all
----------
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with Agreement Accounting
Principles.
9.10. Severability of Provisions. Any provision in any Loan Document
----------------------------
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.11. Nonliability of Lenders. The relationship between the Borrower
-------------------------
and the Lenders and the Agent shall be solely that of borrower and lender.
Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower. Neither the Agent nor any Lender undertakes any responsibility to
the Borrower to review or inform the Borrower of any matter in connection with
any phase of the Borrower's business or operations. The Borrower shall rely
entirely upon its own judgment with respect to its business, and any review,
inspection or supervision of, or information supplied to the Borrower by the
Agent or the Lenders is for the protection of the Agent and the Lenders and
neither the Borrower nor any other Person is entitled to rely thereon. The
Borrower agrees that neither the Agent nor any Lender shall have any liability
with respect to, and the Borrower hereby waives, releases and agrees not to ▇▇▇
for, any punitive, special, indirect or consequential damages suffered by the
Borrower in connection with, arising out of, or in any way related to the Loan
Documents or the transactions contemplated thereby or the relationship
established by the Loan Documents, or any act, omission or event occurring in
connection therewith.
9.12. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
-------------
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS, WITHOUT REGARD TO CONFLICT OF LAWS PROVISIONS, OF THE STATE
OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
9.13. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS
-----------------------
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF
THE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS
OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS; PROVIDED, THAT SUCH PROCEEDINGS MAY BE BROUGHT IN OTHER COURTS IF
--------
JURISDICTION MAY NOT BE OBTAINED IN A COURT IN CHICAGO, ILLINOIS.
9.14. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER
-----------------------
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
9.15. Disclosure. The Borrower and each Lender hereby (a) acknowledge
----------
and agree that Bank One and/or its Affiliates from time to time may hold other
investments in, make other loans to or have other relationships with the
Borrower, including, without limitation, in connection with any interest rate
hedging instruments or agreements or swap transactions, and (b) waive any
liability of Bank One or such Affiliate to the Borrower or any Lender,
respectively, arising out of or resulting from such investments, loans or
relationships other than liabilities arising out of the gross negligence or
willful misconduct of Bank One or its Affiliates.
9.16. Counterparts. This Agreement may be executed in any number of
------------
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Agreement by signing any such
counterpart. This Agreement shall be effective when it has been executed by the
Borrower, the Agent and the Lenders and each party has notified the Agent that
it has taken such action.
9.17. Confidentiality. Each Lender agrees to take normal and
---------------
reasonable precautions and exercise due care to maintain the confidentiality of
all information provided to it by the Borrower, or by the Agent on the
Borrower's behalf, in connection with this Agreement or any other Loan Document,
and no Lender shall use any such information for any purpose or in any manner
other than pursuant to the terms contemplated by this Agreement, except to the
extent such information (a) was or becomes generally available to the public
other than as a result of a disclosure by such Lender, or (b) was or becomes
available on a non-confidential basis from a source other than the Borrower,
provided that such source is not bound by a confidentiality agreement with the
--------
Borrower or its agents known to such Lender; provided, further, however, that
-------- ------- -------
any Lender may disclose such information (i) after being advised by counsel
(including internal counsel), at the request or pursuant to any requirement of
any governmental or regulatory authority to which such Lender is subject or in
connection with an examination of such Lender by any such authority; (ii)
pursuant to subpoena or other court process, provided that, if it is lawful to
--------
do so, such Lender shall give prompt notice to the Borrower of service thereof
so that the Borrower may seek a protective order or other appropriate remedy or
waive compliance with the provisions of this Section 9.17; (iii) after being
------------
advised by counsel (including internal counsel), when required to do so in
accordance with the provisions of any applicable requirement of law; (iv) to the
extent reasonably required in connection with any litigation or proceeding
involving the Borrower or any of its Subsidiaries to which the Agent, any Lender
or their respective Affiliates may be party, (v) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document, (vi) to such Lender's independent auditors and other
professional advisors as to which such information has been identified as
confidential, and (vii) to such Lender's Affiliates which have agreed to be
bound by the same confidentiality obligations as apply to such Lender.
ARTICLE X
THE AGENT
---------
10.1. Appointment. Bank One is hereby appointed Agent hereunder and
-----------
under each other Loan Document, and each of the Lenders authorizes the Agent to
act as the agent of such Lender. The Agent agrees to act as such upon the
express conditions contained in this Article X. The Agent shall not have a
---------
fiduciary relationship in respect of the Borrower or any Lender by reason of
this Agreement.
10.2. Powers. The Agent shall have and may exercise such powers under
------
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder, except any action specifically provided
by the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
-----------------
officers, agents or employees shall be liable to the Borrower or any Lender for
any action taken or omitted to be taken by it or them hereunder or under any
other Loan Document or in connection herewith or therewith except for its or
their own gross negligence or willful misconduct.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent
----------------------------------------------
nor any of its directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into, or verify (a) any statement,
warranty or representation made in connection with any Loan Document or any
borrowing hereunder, (b) the performance or observance of any of the covenants
or agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
----------
receipt of items required to be delivered to the Agent and not waived at
closing, or (d) the validity, effectiveness, sufficiency, enforceability or
genuineness of any Loan Document or any other instrument or writing furnished in
connection therewith. The Agent shall have no duty to disclose to the Lenders
information that is not required to be furnished by the Borrower to the Agent at
such time, but is voluntarily furnished by the Borrower to the Agent (either in
its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all cases
----------------------------------
be fully protected in acting, or in refraining from acting, hereunder and under
any other Loan Document in accordance with written instructions signed by the
Required Lenders (or, to the extent required by Section 8.2, all Lenders), and
-----------
such instructions and any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders and on all holders of Notes. The Agent shall
be fully justified in failing or refusing to take any action hereunder and under
any other Loan Document unless it shall first be indemnified to its satisfaction
by the Lenders pro rata against any and all liability, cost and expense that it
may incur by reason of taking or continuing to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any of
----------------------------------
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to
--------------------------------
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree to
------------------------------------------
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (a) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (b) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents, and
(c) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of the Loan Documents or any other document
delivered in connection therewith or the transactions contemplated thereby, or
the enforcement of any of the terms thereof or of any such other documents;
provided, that no Lender shall be liable for any of the foregoing to the extent
--------
they arise from the gross negligence or willful misconduct of the Agent. The
obligations of the Lenders under this Section 10.8 shall survive payment of the
------------
Obligations and termination of this Agreement.
10.9. Notice of Default. The Agent shall not be deemed to have
-------------------
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement describing such Default or Unmatured
Default and stating that such notice is a "notice of default". In the event
that the Agent receives such a notice, the Agent shall give prompt notice
thereof to the Lenders.
10.10. Rights as a Lender. In the event the Agent is a Lender, the
---------------------
Agent shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the same as though it were not the
Agent, and the term "Lender" or "Lenders" shall, at any time when the Agent is a
Lender, unless the context 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 trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Agent, in its individual capacity, is not obligated to remain a Lender.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
------------------------
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by the Borrower and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
10.12. Successor Agent. The Agent may resign at any time by giving
----------------
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required Lenders shall have
the right to appoint, on behalf of the Lenders, a successor Agent. If no
successor Agent shall have been so appointed by the Required Lenders and shall
have accepted such appointment within thirty days after the resigning Agent's
giving notice of its intention to resign, then the resigning Agent may appoint,
on behalf of the Borrower and the Lenders, a successor Agent. If the Agent has
resigned and no successor Agent has been appointed, the Lenders may perform all
the duties of the Agent hereunder and the Borrower shall make all payments in
respect of the Obligations to the applicable Lender and for all other purposes
shall deal directly with the Lenders. No successor Agent shall be deemed to be
appointed hereunder until such successor Agent has accepted the appointment.
Any such successor Agent shall be a commercial bank having capital and retained
earnings of at least $50,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning Agent. Upon the effectiveness of the resignation of the Agent,
the resigning Agent shall be discharged from its duties and obligations
hereunder and under the Loan Documents. After the effectiveness of the
resignation of an Agent, the provisions of this Article X shall continue in
---------
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents.
10.13. Documentation Agent; Syndication Agent. Any Lender identified
----------------------------------------
in this Agreement as a Documentation Agent or Syndication Agent shall not have
any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limiting
the foregoing, none of such Lenders shall have or be deemed to have a fiduciary
relationship with any Lender. Each Lender hereby makes the same acknowledgments
with respect to such Lenders as it makes with respect to the Agent in Section
-------
10.11.
-----
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1. Setoff. In addition to, and without limitation of, any rights of
------
the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default or Unmatured Default occurs, any and all deposits
(including all account balances, whether provisional or final and whether or not
collected or available) and any other Indebtedness at any time held or owing by
any Lender to or for the credit or account of the Borrower may be offset and
applied toward the payment of the Obligations owing to such Lender, whether or
not the Obligations, or any part hereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise,
----------------
has payment made to it upon its Loans (other than payments received pursuant to
Section 3.1, 3.2 or 3.4) in a greater proportion than its pro-rata share of such
----------- --- ---
Loans, such Lender agrees, promptly upon demand, to purchase a portion of the
Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made. If an
amount to be setoff is to be applied to Indebtedness of the Borrower to a
Lender, other than Indebtedness evidenced by any of the Notes held by such
Lender, such amount shall be applied ratably to such other Indebtedness and to
the Indebtedness evidenced by such Notes.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
12.1. Successors and Assigns. The terms and provisions of the Loan
------------------------
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (a) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents, and (b) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (b) of this Section, any Lender may
------------- ----------
at any time, without the consent of the Borrower or the Agent, assign all or any
portion of its rights under this Agreement and its Notes to a Federal Reserve
Bank; provided, however, that no such assignment to a Federal Reserve Bank shall
-------- -------
release the transferor Lender from its obligations hereunder. The Agent may
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until such payee complies with Section 12.3 in the case of an assignment
------------
thereof or, in the case of any other transfer, a written notice of the transfer
is filed with the Agent. Any assignee or transferee of a Note agrees by
acceptance thereof to be bound by all the terms and provisions of the Loan
Documents. 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.
12.2. Participations.
--------------
12.2.1. Permitted Participants; Effect. Any Lender may, in the ordinary
--------------------------------
course of its business and in accordance with applicable law, at any time sell
to one or more banks or other entities ("Participants") participating interests
------------
in any Loan owing to such Lender, any Note held by such Lender, any Commitment
of such Lender or any other interest of such Lender under the Loan Documents.
In the event of any such sale by a Lender of participating interests to a
Participant, such Lender's obligations under the Loan Documents shall remain
unchanged, such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, such Lender shall remain the
holder of any such Note for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if such
Lender had not sold such participating interests, and the Borrower and the Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole right to approve,
--------------
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver which effects any of the modifications referenced in clauses (a) through
(g) of Section 8.2.
------------
12.2.3. Benefit of Setoff. The Borrower agrees that each Participant shall be
------------------
deemed to have the right of setoff provided in Section 11.1 in respect of its
------------
participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents; provided, that each Lender shall retain
--------
the right of setoff provided in Section 11.1 with respect to the amount of
------------
participating interests sold to each Participant. The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each Lender, any amount received
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pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 11.2 as if each Participant were a Lender.
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12.3. Assignments.
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12.3.1. Permitted Assignments. Any Lender may, in the ordinary course of
----------------------
its business and in accordance with applicable law, at any time assign to one or
more banks or other entities ("Purchasers") all or any part of its rights and
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obligations under the Loan Documents; provided, however, that in the case of an
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assignment to an entity which is not a Lender or an Affiliate of a lender, such
assignment shall be in a minimum amount of $5,000,000. Such assignment shall be
substantially in the form of Exhibit C hereto or in such other form as may be
---------
agreed to by the parties thereto. The consent of the Agent and, so long as no
Default is continuing, the Borrower shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not a Lender or an
Affiliate thereof. Such consent shall not be unreasonably withheld.
12.3.2. Effect; Effective Date. Upon (a) delivery to the Agent of a notice of
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assignment, substantially in the form attached as Exhibit I to Exhibit C hereto
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(a "Notice of Assignment"), together with any consents required by Section
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12.3.1, and (b) payment of a $3,500 fee to the Agent for processing such
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assignment, such assignment shall become effective on the effective date
specified in such Notice of Assignment. On and after the effective date of such
assignment, (a) such Purchaser shall for all purposes be a Lender party to this
Agreement and any other Loan Document executed by the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the same
extent as if it were an original party hereto, and (b) the transferor Lender
shall be released with respect to the percentage of the Aggregate Commitment and
Loans assigned to such Purchaser without any further consent or action by the
Borrower, the Lenders or the Agent. Upon the consummation of any assignment to
a Purchaser pursuant to this Section 12.3.2, the transferor Lender, the Agent
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and the Borrower shall make appropriate arrangements so that replacement Notes
are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser, in each case, to the extent
applicable, in principal amounts reflecting their Commitment, as adjusted
pursuant to such assignment.
12.4. Dissemination of Information. The Borrower authorizes each
------------------------------
Lender to disclose to any Participant or Purchaser or any other Person acquiring
an interest in the Loan Documents by operation of law (each a "Transferee") and
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any prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries.
12.5. Tax Treatment. If any interest in any Loan Document is
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transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 2.15.
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ARTICLE XIII
NOTICES
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13.1. Giving Notice. Except as otherwise permitted by Section 2.10
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with respect to borrowing notices, all notices and other communications provided
to any party hereto under this Agreement or any other Loan Document shall be in
writing, by facsimile, first class U.S. mail or overnight courier and addressed
or delivered to such party at its address set forth below its signature hereto
or at such other address as may be designated by such party in a notice to the
other parties. Any notice, if mailed and properly addressed with first class
postage prepaid, return receipt requested, shall be deemed given three (3)
Business Days after deposit in the U.S. mail; any notice, if transmitted by
facsimile, shall be deemed given when transmitted; and any notice given by
overnight courier shall be deemed given when received by the addressee.
13.2. Change of Address. The Borrower, the Agent and any Lender may
-------------------
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
[signature pages to follow]
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
RALCORP HOLDINGS, INC.
By: ___________________________________
Print Name: _____________________________
Title: ___________________________________
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: _______________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (314) 877-____
BANK ONE, NA,
Individually and as Agent
By:_______________________________________
Print Name:________________________________
Title: _____________________________________
Address: ▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
WACHOVIA BANK, N.A.,
Individually as a Lender
By:_______________________________________
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
PNC BANK, NATIONAL ASSOCIATION
Individually as a Lender
By:---------_______________________________________
Print Name:________________________________
Title: _____________________________________
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
SCHEDULE 1
LENDER COMMITMENT
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Bank One, NA $ 85,000,000
Wachovia Bank, NA $ 75,000,000
PNC Bank, National Association $ 40,000,000
AGGREGATE COMMITMENT: $200,000,000
719383.5
719383.5