EXHIBIT 10.30
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CREDIT AGREEMENT
________________________________________________________________________________
among
THE FINISH LINE, INC.,
the LENDERS Signatory Hereto
and
NATIONAL CITY BANK OF INDIANA, as Agent
________________________________________________________________________________
Dated as of September 20, 2000
________________________________________________________________________________
TABLE OF CONTENTS
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SECTION 1 Definitions........................................................... -1-
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1.1. Defined Terms......................................................... -1-
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1.2. Rules of Construction................................................. -16-
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1.3. Accounting Terms...................................................... -16-
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SECTION 2 The Credits........................................................... -17-
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2.1. Commitments........................................................... -17-
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2.1.1 Revolving Loans............................................... -17-
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2.1.2 Swingline..................................................... -17-
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2.2. Required Payments: Termination........................................ -17-
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2.3. Ratable Loans/Mandatory Funding....................................... -17-
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2.4. Types of Advances..................................................... -18-
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2.4.1 Revolving Loans............................................... -18-
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2.4.2 Swingline..................................................... -18-
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2.5. Up Front Fee; Facility Fee; Reductions in Revolving Loan Commitment... -18-
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2.6. Minimum Amount of Each Advance ....................................... -19-
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2.6.1 Revolving Loans............................................... -19-
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2.6.2 Swingline..................................................... -19-
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2.7. Optional Principal Payments........................................... -19-
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2.7.1 Revolving Loans............................................... -19-
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2.7.2 Swingline..................................................... -19-
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2.8. Method of Selecting Types and Interest Periods for New Advances....... -20-
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2.8.1 Revolving Loans............................................... -20-
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2.8.2 Swingline..................................................... -20-
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2.9. Conversion and Continuation of Outstanding Advances................... -20-
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2.10. Changes in Interest Rate, etc ........................................ -21-
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2.11. Rates Applicable After Default........................................ -21-
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2.12. Method of Payment..................................................... -22-
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2.13. Notes; Telephonic Notices............................................. -22-
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2.14. Interest Payment Dates; Interest and Fee Basis........................ -22-
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2.15. Notification of Advances, Interest Rates, Prepayments and Commitment
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Reductions............................................................ -23-
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2.16. Lending Installations................................................. -23-
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2.17. Non-Receipt of Funds by the Agent..................................... -23-
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2.18. Issuance of Letters of Credit......................................... -23-
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2.19. Letters of Credit Participation ...................................... -24-
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2.20. Compensation for Letters of Credit.................................... -26-
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2.20.1. Letter of Credit Fee.......................................... -26-
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2.20.2. Additional Letter of Credit Fees.............................. -26-
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2.20.3. Manner of Payment............................................. -26-
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2.21. Reimbursement of Letters of Credit.................................... -26-
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2.22 Use of Proceeds................................................... -27-
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SECTION 3 YIELD PROTECTION; TAXES........................................... -28-
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3.1. Yield Protection.................................................. -28-
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3.2. Changes in Capital Adequacy Regulations........................... -28-
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3.3. Availability of Types of Advances................................. -29-
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3.4. Funding Indemnification........................................... -29-
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3.5. Taxes............................................................. -29-
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3.6. Lender Statements; Survival of Indemnity.......................... -31-
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SECTION 4 CONDITIONS PRECEDENT.............................................. -31-
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4.1. Initial Advance................................................... -31-
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4.2. Each Advance...................................................... -33-
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SECTION 5 REPRESENTATIONS AND WARRANTIES.................................... -33-
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5.1. Corporate Existence and Standing.................................. -33-
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5.2. Authorization and Validity........................................ -33-
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5.3. No Conflict; Government Consent................................... -33-
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5.4. Financial Statements.............................................. -34-
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5.5. No Material Adverse Change........................................ -34-
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5.6. Taxes............................................................. -34-
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5.7. Litigation and Contingent Obligations............................. -34-
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5.8. Subsidiaries...................................................... -34-
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5.9. ERISA............................................................. -35-
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5.10. Accuracy of Information........................................... -35-
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5.11. Regulation U...................................................... -35-
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5.12. Material Agreements............................................... -35-
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5.13. Compliance With Laws.............................................. -35-
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5.14. Ownership of Properties........................................... -35-
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5.15. Plan Assets; Prohibited Transactions.............................. -35-
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5.16. Environmental Matters............................................. -36-
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5.17. Investment Company Act............................................ -36-
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5.18. Public Utility Holding Company Act................................ -36-
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5.19. Insurance......................................................... -36-
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5.20. Solvency.......................................................... -36-
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SECTION 6 COVENANTS......................................................... -37-
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6.1. Financial Reporting............................................... -37-
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6.2. Use of Proceeds................................................... -38-
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6.3. Notice of Default................................................. -39-
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6.4. Conduct of Business .............................................. -39-
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6.5. Taxes............................................................. -39-
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6.6. Insurance......................................................... -39-
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6.7. Compliance with Laws............................................... -39-
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6.8. Maintenance of Properties.......................................... -39-
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6.9. Inspection......................................................... -39-
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6.10. Dividends.......................................................... -40-
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6.11. Merger............................................................. -40-
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6.12. Sale of Assets..................................................... -40-
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6.13. Investments and Acquisitions....................................... -40-
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6.14. Liens.............................................................. -42-
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6.15. Indebtedness....................................................... -43-
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6.16. Capital Expenditures............................................... -44-
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6.17. Consolidated Tangible Net Worth.................................... -44-
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6.18. Leverage Ratio..................................................... -44-
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6.19. Sale and Leaseback................................................. -44-
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6.20. Restrictive Agreements............................................. -44-
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6.21. New Guarantors..................................................... -45-
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6.22. Affiliates......................................................... -45-
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6.23. Accounting Policies................................................ -45-
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6.24. Subordinated Indebtedness.......................................... -45-
SECTION 7 DEFAULTS........................................................... -46-
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SECTION 8 ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES .................... -48-
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8.1. Acceleration....................................................... -48-
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8.2. Amendments......................................................... -48-
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8.3. Preservation of Rights............................................. -49-
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SECTION 9 GENERAL PROVISIONS................................................. -49-
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9.1. Survival of Representations........................................ -49-
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9.2. Governmental Regulation............................................ -49-
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9.3. Headings........................................................... -49-
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9.4. Entire Agreement................................................... -50-
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9.5. Several Obligations; Benefits of this Agreement.................... -50-
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9.6. Expenses; Indemnification.......................................... -50-
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9.7. Numbers of Documents............................................... -51-
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9.8. Severability of Provisions......................................... -51-
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9.9. Relationship of Parties; Mutual Release of Consequential Damages... -51-
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9.10. Confidentiality.................................................... -51-
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9.11. Nonreliance........................................................ -51-
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SECTION 10 THE AGENT ......................................................... -51-
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10.1. Appointment; Nature of Relationship................................ -51-
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10.2. Powers............................................................. -52-
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10.3. General Immunity................................................... -52-
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10.4. No Responsibility for Loans, Recitals, etc ........................ -52-
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10.5. Action on Instructions of Lenders.................................. -53-
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10.6. Employment of Agents and Counsel................................... -53-
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10.7. Reliance on Documents; Counsel..................................... -53-
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10.8. Agent's Reimbursement and Indemnification.......................... -53-
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10.9. Notice of Default.................................................. -54-
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10.10. Rights as a Lender................................................. -54-
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10.11. Lender Credit Decision............................................. -54-
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10.12. Successor Agent.................................................... -54-
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10.13. Agent's Fee........................................................ -55-
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10.14. Delegation to Affiliates........................................... -55-
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SECTION 11 SET OFF; RATABLE PAYMENTS.......................................... -55-
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11.1. Set off............................................................ -55-
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11.2. Ratable Payments................................................... -55-
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SECTION 12 BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS.................. -56-
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12.1. Successors and Assigns............................................. -56-
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12.2. Participations..................................................... -56-
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12.2.1 Permitted Participants; Effect............................ -56-
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12.2.2. Voting Rights............................................. -57-
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12.2.3. Benefit of Set off........................................ -57-
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12.3. Assignments........................................................ -57-
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12.3.1. Permitted Assignments..................................... -57-
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12.3.2. Effect; Effective Date.................................... -58-
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12.4. Dissemination of Information....................................... -58-
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12.5. Tax Treatment...................................................... -58-
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12.6. Replacement of Lenders............................................. -58-
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SECTION 13 NOTICES............................................................ -59-
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13.1. Notices............................................................ -59-
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13.2. Change of Address.................................................. -59-
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SECTION 14 COUNTERPARTS....................................................... -59-
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SECTION 15 CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL....... -60-
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15.1. CHOICE OF LAW...................................................... -60-
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15.2. CONSENT TO JURISDICTION............................................ -60-
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15.3. WAIVER OF JURY TRIAL............................................... -60-
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Schedule 1 - Lenders
Schedule 5.7 - Litigation and Contingent Obligations
Schedule 5.8 - Subsidiaries
Schedule 6.13 - Other Existing Investments
Schedule 6.14 - Liens
Exhibit A - Form of Revolving Credit Note
Exhibit B - Credit Note (Swingline)
Exhibit C - Compliance Certificate
Exhibit D - Guaranty
Exhibit E - Assignment Agreement
Exhibit F - Written Money Transfer Instructions
Exhibit G - Form of Independent Auditor's Report
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CREDIT AGREEMENT
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THIS CREDIT AGREEMENT, dated as of the 20th day of September, 2000, is
among THE FINISH LINE, INC., a Delaware corporation ("Borrower"), the Lenders
party hereto from time to time as listed on Schedule 1 hereto, and NATIONAL CITY
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BANK OF INDIANA, a national banking association, as agent for the Lenders
hereunder (in such capacity, the "Agent"). The parties hereto agree as follows:
SECTION 1
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Definitions
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1.1. Defined Terms. As used herein:
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"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which
Borrower or any of its Subsidiaries (a) acquires any going business or all or
substantially all of the assets of any Person, or division 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
ownership interests of a partnership or limited liability company.
"Advance" means a borrowing hereunder (or conversion or continuation
thereof) consisting of the aggregate amount of the several Loans made on the
same Borrowing Date (or date of conversion or continuation) by the Lenders to
Borrower of the same Type.
"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 ten
percent (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 National City Bank of Indiana, in its capacity as
contractual representative of the Lenders hereunder, and not in its individual
capacity as a Lender, and any successor Agent appointed pursuant to this
Agreement.
"Agreement" means this Credit Agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the greater of (a) the Prime Rate for such day, or (b) the sum of the
Federal Funds Effective Rate for such day plus One-Half of One Percent (1/2%).
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"ABR Advance" means an Advance which bears interest at the Alternate
Base Rate.
"Applicable Facility Fee" means the per annum fee payable to the Agent
for the pro rata benefit of the Lenders as determined pursuant to Section 2.5,
which shall be based on the Leverage Ratio and determined by reference to the
following table:
Leverage Ratio Applicable Facility Fee
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Level 1 Less than 2.0 to 1.0 0.10%
Level 2 Equal to or greater than
2.0 to 1.0 but less than
2.50 to 1.0 0.15%
Level 3 Equal to or greater than
2.50 to 1.0 but less than
3.0 to 1.0 0.175%
▇▇▇▇▇ ▇ Equal to or greater than
3.0 to 1.0 but less than
3.50 to 1.0 0.20%
Level 5 Equal to or greater than
3.50 to 1.0 0.25%
The Applicable Facility Fee for Level 3 shall initially apply and shall be
subject to adjustment quarterly (upwards or downwards, as appropriate) based on
the Leverage Ratio in accordance with the table set forth above. The Leverage
Ratio shall be determined by the Agent (which determination if made in good
faith shall be conclusive absent manifest error) based on the Financial
Statements. The adjustment, if any, to the Applicable Facility Fee shall be
effective beginning on the fifth (5th) Business Day after the delivery of such
Financial Statements. In the event that Borrower shall at any time fail to
furnish to the Agent in timely fashion the Financial Statements required to be
delivered pursuant to Section 6.1, together with the Compliance Certificate to
be delivered with respect thereto, the Applicable Facility Fee for Level 5 shall
apply until the fifth (5th) Business Day after such Financial Statements and
Compliance Certificate are so delivered. In no event shall the Applicable
Facility Fee be adjusted downward if there exists a Default on the date on which
such downward adjustment would otherwise become effective until such time as the
Default has been cured, waived or ceases to exist. The provisions of this
definition are not intended to, and shall not be construed to, authorize any
violation by Borrower of any financial covenant contained in this Agreement.
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"Applicable Margin" means the incremental margin to be paid by Borrower
on LIBOR Loans hereunder and on Letters of Credit issued hereunder, which margin
shall be based on the Leverage Ratio and determined by reference to the
following table:
Leverage Ratio Applicable Margin
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Letters
LIBOR Loans of Credit
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Level 1 Less than 2.0 to 1.0 .50% .50%
Level 2 Equal to or greater than
2.0 to 1.0 but less than
2.50 to 1.0 .75% .75%
Level 3 Equal to or greater than
2.50 to 1.0 but less than
3.0 to 1.0 1.0% 1.0%
Level 4 Equal to or greater than
3.0 to 1.0 but less than
3.50 to 1.0 1.25% 1.25%
Level 5 Equal to or greater than
3.50 to 1.0 1.50% 1.50%
The Applicable Margin for Level 3 shall initially apply and shall be subject to
adjustment quarterly (upwards or downwards, as appropriate) based on the
Leverage Ratio in accordance with the table set forth above. The Leverage Ratio
shall be determined by the Agent (which determination if made in good faith
shall be conclusive absent manifest error) based on the Financial Statements.
The adjustment, if any, to the Applicable Margin shall be effective beginning on
the fifth (5th) Business Day after the delivery of such Financial Statements. In
the event that Borrower shall at any time fail to furnish to the Agent in timely
fashion the Financial Statements required to be delivered pursuant to Section
6.1, together with the Compliance Certificate to be delivered with respect
thereto, the Applicable Margin for Level 5 shall apply until the fifth (5th)
Business Day after such Financial Statements and Compliance Certificate are so
delivered. In no event shall the Applicable Margin be adjusted downward if there
exists a Default on the date on which such downward adjustment would otherwise
become effective until such time as the Default has been cured, waived or ceases
to exist. The provisions of this definition are not intended to, and shall not
be construed to, authorize any violation by Borrower of any financial covenant
contained in this Agreement.
"Arranger" means National City Bank of Indiana, a national banking
association, and its successors.
"Authorized Officer" means the President or any Executive Vice
President or such other officer of Borrower whose authority to perform acts to
be performed only by an Authorized Officer
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under the terms of this Agreement is evidenced by a written authorization signed
by an Authorized Officer or by a certified copy of an appropriate resolution of
the Board of Directors of Borrower.
"Borrower" means The Finish Line, Inc., a Delaware corporation.
"Borrowing Base" means, on any date of determination, an amount equal
to forty-five percent (45%) of the positive difference of (a) the aggregate
value of Borrower's Eligible Inventory, minus (b) Borrower's outstanding
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accounts payable as shown on Borrower's most recent Financial Statements and as
determined in accordance with GAAP.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" shall have the meaning ascribed thereto in Section
2.8.1.
"Business Day" means (a) with respect to any borrowing, payment or rate
selection of LIBOR Advances, a day (other than a Saturday or Sunday) on which
each Lender is open for the conduct of substantially all of its 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 each Lender is open for the conduct of
substantially all of its commercial lending activities.
"Capital Expenditures" means, without duplication, any expenditures for
any purchase or other acquisition of any asset which would be classified as a
fixed or capital asset on a consolidated balance sheet of Borrower and its
Subsidiaries prepared in accordance with GAAP.
"Capitalized Lease" means any lease of Property which would be
capitalized on a balance sheet of a Person prepared in accordance with GAAP.
"Capitalized Lease Obligations" means the amount of the obligations of
a Person under Capitalized Leases which would be shown as a liability on a
balance sheet of a Person prepared in accordance with GAAP.
"Change" shall have the meaning ascribed thereto in Section 3.2.
"Change in Control" means (a) one or more of the existing owners of the
class B stock of Borrower (including a "Permitted Transferee" (as defined in
Borrower's Restated Certificate of Incorporation in effect as of the date
hereof) of such existing owners) fail to own, in the aggregate, more than
fifty-one percent (51%) of the total voting rights of Borrower, or (b) the
occurrence during any period of twelve (12) consecutive months, commencing
before or after the date of this Agreement, pursuant to which individuals who on
the first day of such period were directors of Borrower (together with any
replacement or additional directors who were nominated or elected by a majority
of directors then in office) cease to constitute a majority of the Board of
Directors of Borrower.
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"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, such Lender's Revolving Loan
Commitment and such other commitments that may be provided in this Agreement or
as set forth in any Notice of Assignment relating to any assignment that has
become effective pursuant to Section 12.3.2, as such amount may be modified from
time to time pursuant to the terms hereof.
"Compliance Certificate" means a Compliance Certificate, in the form of
Exhibit C hereto, duly executed by the chief executive officer or chief
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financial officer of Borrower.
"Condemnation" shall have the meaning ascribed thereto in Section 7.8.
"Consolidated Interest Expense" means, for any period, the consolidated
gross interest expense of Borrower and its Subsidiaries, determined on a
consolidated basis and as shown on the Financial Statements.
"Consolidated Net Income" means, for any period, the consolidated net
income (or loss) of Borrower and its Subsidiaries after deductions for income
taxes, determined on a consolidated basis in accordance with GAAP and as shown
on the Financial Statements.
"Consolidated Net Worth" means the excess of Borrower's Consolidated
Total Assets over Borrower's Consolidated Total Liabilities.
"Consolidated Tangible Net Worth" means, on any date of determination,
the amount by which (a) Consolidated Net Worth exceeds (b) the sum of (i) all
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assets of Borrower and its Subsidiaries which would be classified as intangible
assets under GAAP, including without limitation, goodwill (whether representing
the excess of cost over book value of assets acquired or otherwise), patents,
trademarks, trade names, copyrights, franchises, operating permits, unamortized
debt discount and expense, organization costs, and research and development
costs, (ii) treasury stock, (iii) securities not constituting marketable
securities, (iv) cash set apart and held in a sinking or other similar fund
established for the purpose of redemption or other retirement of capital stock,
(v) to the extent not otherwise deducted, reserves for depreciation, depletion,
obsolescence and/or amortization of properties and all other reserves or
appropriations of retained earnings which, in accordance with GAAP, should be
established in connection with the business conducted by Borrower, and (vi) any
revaluation or other write-up in book value of assets subsequent to the date
hereof (but only to the extent not permitted under GAAP).
"Consolidated Total Assets" means the total assets of Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP and as
shown on the Financial Statements.
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"Consolidated Total Liabilities" means the total liabilities of
Borrower and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP and as shown on the Financial Statements.
"Conversion/Continuation Notice" shall have a meaning ascribed thereto
in Section 2.9.
"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control which, together with Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Credit Note" means the Credit Note (Swingline), in substantially the
form of Exhibit B hereto, duly executed by Borrower to NCB to evidence Advances
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under the Swingline, including any amendment, modification, renewal, extension
or replacement thereof.
"Default" means an event described in Section 7.
"EBITDA" means, with respect to Borrower and its Subsidiaries
determined on a consolidated basis for any specified period, the sum of (a)
Consolidated Net Income, plus (b) to the extent deducted in determining
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Consolidated Net Income, income taxes paid or accrued, minus (c) to the extent
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included in Consolidated Net Income, extraordinary gains, plus (d) to the extent
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deducted in determining Consolidated Net Income, extraordinary losses, plus (e)
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Consolidated Interest Expense, plus (f) to the extent deducted in determining
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Consolidated Net Income, depreciation and amortization.
"Eligible Assignee" means a commercial bank, financial institution or
other "accredited investor," as defined in Regulation D of the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
"Eligible Inventory" means, on any date of determination, Borrower's
merchandise inventory (net of reserves) as shown on Borrower's most recent
Financial Statements and as determined in accordance with GAAP, which is not
subject to any Lien (other than Permitted Liens), is not stored with any bailee,
warehouseman or similar party, and is not placed on consignment with any
consignee.
"Environmental Laws" means all provisions of laws, statutes,
ordinances, rules, regulations, permits, licenses, judgments, writs,
injunctions, decrees, orders, awards and standards promulgated by any
Governmental Authority concerning the protection of, or regulation of the
discharge of substances into, the environment or concerning the health or safety
of persons with respect to environmental hazards, and includes, without
limitation, the Hazardous Materials Transportation Act, 42 U.S.C.(S).1801 et
--
seq., the Comprehensive Environmental Response, Compensation and Liability Act
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of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986,
42 U.S.C.(S).(S).9601 et seq., the Solid Waste Disposal Act, as amended by the
Resource Conservation
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and Recovery Act of 1976 and the Solid and Hazardous Waste Amendments of 1984,
42 U.S.C.(S)(S)6901 et seq., the Federal Water Pollution Control Act, as
amended by the Clean Water Act of 1977, 33 U.S.C.(S)(S)1251 et seq., the Clean
Air Act of 1966, as amended, 42 U.S.C.(S)(S) 7401 et seq., the Toxic Substances
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Control Act of 1976, 15 U.S.C.(S)(S)2601 et seq., the Federal Insecticide,
Fungicide, and Rodenticide Act, 7 U.S.C.(S)7401 et seq., the Occupational
Safety and Health Act of 1970, as amended, 29 U.S.C.(S)(S)651 et seq., the
Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C.(S)(S)
11001 et seq., the National Environmental Policy Act of 1975, 42 U.S.C.(S)(S)
4321 et seq., the Safe Drinking Water Act of 1974, as amended, 42 U.S.C.(S)(S)
300(f) et seq., and any similar or implementing state law, and all amendments,
rules, and regulations promulgated thereunder.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"ERISA Affiliate" means any trade or business, whether or not
incorporated, which together with Borrower would be treated as a single employer
under ERISA.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, (a) federal taxes imposed on its overall net
income, and (b) other taxes imposed on its overall net income, and franchise
taxes imposed on it, by (i) the jurisdiction under the laws of which such Lender
or the Agent is incorporated or organized, (ii) the jurisdiction in which the
Agent's or such Lender's principal executive office or such Lender's applicable
Lending Installation is located, or (iii) a jurisdiction imposing such taxes as
a result of a former connection between the Agent, such Lender or such Lender's
applicable Lending Installation and such jurisdiction.
"Facilities" means the Revolving Loans, the Swingline, the Letters of
Credit, and any other credit facility provided by the Lenders from time to time
pursuant to this Agreement.
"Facility Termination Date" means September 20, 2003.
"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 10:00 a.m.
(Indianapolis time) on such day on such transactions received by the Agent from
three (3) Federal funds brokers of recognized standing selected by the Agent in
its sole discretion.
"Fee Letter" means that certain letter agreement issued by the Agent
dated September 19, 2000, and accepted by Borrower on September 20, 2000.
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"Financial Contract" of a Person means (a) any exchange-traded or
over-the-counter futures, commodity, forward, swap or option contract or other
financial instrument with similar characteristics, (b) any agreements, devices
or arrangements providing for payments related to fluctuations of interest
rates, exchange rates or forward rates, including, but not limited to, interest
rate exchange agreements, forward currency exchange agreements, interest rate
cap or collar protection agreements, forward rate currency or interest rate
options, or (c) to the extent not otherwise included in the foregoing, any Rate
Hedging Agreement.
"Financial Statements" means, as the context may require, (a) the
consolidated and consolidating balance sheets of Borrower and its Subsidiaries
as of May 27, 2000 and their consolidated and consolidating statements of income
and retained earnings and consolidated statement of cash flows for the periods
then ended, and (b) the consolidated and consolidating financial statements of
Borrower and its Subsidiaries furnished from time to time pursuant to Section
6.1; in all cases, together with any accompanying notes thereto, and any other
documents or data furnished in connection therewith.
"GAAP" means generally accepted accounting principles in the United
States of America in effect from time to time as promulgated by the Financial
Accounting Standards Board and recognized and interpreted by the American
Institute of Certified Public Accountants.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of, or pertaining
to, government, including, without limiting the generality of the foregoing, any
agency, body, commission, court or department thereof, whether federal, state,
local or foreign.
"Guarantors" means, jointly and severally, Spike's Holding, Inc., a
Delaware corporation and any U.S. domestic Subsidiaries of Borrower that become
Guarantors pursuant to Section 6.21.
"Guaranty" means each Subsidiary Guaranty, in substantially the form of
Exhibit D hereto, duly executed by each of the Guarantors to the Lenders in
---------
connection with the Obligations, including any modification or replacement
thereof.
"Hazardous Materials" means asbestos, polychlorinated biphenyls and
petroleum products and any other regulated, hazardous or toxic materials, wastes
and substances which are regulated, defined, determined or identified as such in
any Environmental Laws (whether now existing or hereafter enacted or
promulgated).
"Indebtedness" of a Person means such Person's (a) obligations for
borrowed money, (b) obligations representing the deferred purchase price of
Property or services, (c) obligations, whether or not assumed, secured by Liens
or payable pursuant to an agreement out of the proceeds from the sale of
Property now or hereafter owned or acquired by such Person, (d) obligations
which are evidenced by notes, acceptances, or other instruments, (e) Capitalized
Lease Obligations, (f)
-8-
indebtedness or other obligations of any other Person for borrowed money or for
the deferred purchase price of property or services, the payment or collection
of which the subject Person has guaranteed (except by reason of endorsement for
collection in the ordinary course of business) or in respect of which the
subject Person is liable, contingently or otherwise, including, without
limitation, liability by way of agreement to provide funds for payment, to
supply funds to or otherwise to invest in such other Person, or otherwise to
assure a creditor against loss, (g) reimbursement or other obligations in
connection with letters of credit, (h) obligations in connection with Sale and
Leaseback Transactions, (i) Net ▇▇▇▇-To-Market Exposure of Rate Hedging
Agreements or other Financial Contracts, and (j) any obligation that may be
quantified arising with respect to any other transaction which is the functional
equivalent of, or takes the place of, borrowing, but which would not constitute
a liability on a balance sheet of such Person prepared in accordance with GAAP;
provided, that Indebtedness shall not be deemed to include (i) rental expense
under any Operating Lease, (ii) accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade, or (iii) any
equity security that is not convertible into Indebtedness (including preferred
stock that is not convertible into Indebtedness).
"Interest Period" means a LIBOR Interest Period and/or a Negotiated
Rate Interest Period, as the context requires.
"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) or contribution of capital by such Person; stocks, bonds, mutual funds,
partnership interests, notes, debentures or other securities owned by such
Person; any deposit accounts and certificates of deposit owned by such Person;
and structured notes, derivative financial instruments and other similar
instruments or contracts owned by such Person.
"LaSalle" means LaSalle Bank National Association, a national banking
association, and its successors.
"Lenders" means the financial institutions listed on Schedule 1 of this
----------
Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on the signature pages hereof or on a Schedule hereto or otherwise selected by
such Lender or the Agent pursuant to Section 2.16.
"Letter of Credit Application" means an Application for Standby Letter
of Credit in the form prescribed by a Letter of Credit Issuer, duly executed by
Borrower in favor of such Letter of Credit Issuer, from time to time, to govern
a Letter of Credit issued pursuant to this Agreement, as any such Letter of
Credit Application may be amended from time to time.
-9-
"Letter of Credit Issuer" means, as to each Letter of Credit issued
hereunder, NCB or LaSalle as the issuer of a Letter of Credit hereunder.
"Letters of Credit" means standby letters of credit now or hereafter
issued by a Letter of Credit Issuer from time to time at the request of, and for
the account of, Borrower issued pursuant to this Agreement.
"Leverage Ratio" means, with respect to Borrower and its Subsidiaries
determined on a consolidated basis as of the last day of any fiscal quarter of
Borrower, the ratio of (a) the sum of (i) Indebtedness, plus (ii) six (6) times
----
Rentals, minus (iii) cash and marketable securities, to (b) the sum of (i)
----- --
EBITDA for the four (4) consecutive fiscal quarters ending on the date of
determination, plus (ii) Rentals; all as determined by reference to the
----
Financial Statements.
"LIBOR" means, with respect to a LIBOR Advance for the relevant LIBOR
Interest Period, the sum of (a) the quotient of (i) the LIBO Base Rate
applicable to such LIBOR Interest Period, divided by (ii) one minus the Reserve
------- -- -----
Requirement (expressed as a decimal), if any, applicable to such LIBOR Interest
Period, plus (b) the Applicable Margin. The LIBOR shall be rounded to the next
----
higher multiple of 1/16 of 1% if the foregoing sum is not such a multiple.
"LIBOR Advance" means an Advance which bears interest by reference to
the LIBOR.
"LIBO Base Rate" means, with respect to a LIBOR Advance for the
relevant LIBOR Interest Period, the rate determined by the Agent to be the rate
at which NCB 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 (2)
Business Days prior to the first day of such LIBOR Interest Period, in the
approximate amount of NCB's relevant LIBOR Loan and having a maturity
approximately equal to such LIBOR Interest Period.
"LIBOR Interest Period" means, with respect to a LIBOR Advance, a
period of one (1), two (2), three (3) or six (6) months commencing on a Business
Day selected by Borrower pursuant to this Agreement. Such LIBOR Interest Period
shall end on the day which corresponds numerically to such date one (1), two
(2), three (3) or six (6) months thereafter, provided, however, that if there is
-------- -------
no such numerically corresponding day in such next, second (2nd), third (3rd) or
sixth (6th) succeeding month, such LIBOR Interest Period shall end on the last
Business Day of such next, second (2nd), third (3rd) or sixth (6th) succeeding
month. If a LIBOR Interest Period would otherwise end on a day which is not a
Business Day, such LIBOR Interest Period shall end on the next succeeding
Business Day, provided, however, that if said next succeeding Business Day falls
-------- -------
in a new calendar month, such LIBOR Interest Period shall end on the immediately
preceding Business Day. Not more than six (6) LIBOR Interest Periods may be
selected at any one time to apply to outstanding Advances.
"LIBOR Loan" means a Loan which bears interest by reference to the
LIBOR.
-10-
"Lien" means any lien (statutory or other), security interest,
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 Documents" means this Agreement, the Notes, each Guaranty, any
Letter of Credit Applications, the Fee Letter, and any other documents or
instruments now or hereafter executed and delivered by or on behalf of Borrower
to any Lender or the Agent to evidence or govern the Obligations.
"Loan" means, with respect to a Lender, such Lender's loan made
pursuant to Section 2 (or any conversion or continuation thereof).
"Mandatory Funding" shall have the meaning ascribed thereto in Section
2.3.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, financial condition or Properties of Borrower and its
Subsidiaries taken as a whole, (b) the ability of Borrower to perform
Obligations under the Loan Documents, (c) the validity or enforceability of any
of the Loan Documents or any material provision thereof or any transaction
contemplated thereby, or (d) the rights and remedies of the Lenders and the
Agent under any of the Loan Documents.
"Material Indebtedness" shall have the meaning ascribed thereto in
Section 7.5.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which Borrower or any member of
the Controlled Group is a party to which more than one employer is obligated to
make contributions.
"NCB" means National City Bank of Indiana, a national banking
association, having its principal offices in Indianapolis, Indiana, in its
individual capacity, and its successors.
"Negotiated Rate" shall mean, with respect to Advances under the
Swingline not constituting ABR Advances, the interest rate mutually agreed upon
between NCB and Borrower and as described in the Fee Letter to be applicable to
Negotiated Rate Advances pursuant to Section 2.4.2.
"Negotiated Rate Advance" means an Advance which bears interest by
reference to a Negotiated Rate.
"Negotiated Rate Interest Period" shall mean, with respect to any
Negotiated Rate Advance, the period commencing on the day such Negotiated Rate
Advance is made and ending on such day thereafter, as mutually agreed upon
between Borrower and NCB, provided that (a) no Negotiated Rate Interest Period
shall exceed thirty (30) days; (b) each Negotiated Rate Interest Period which
-11-
would otherwise end on a day which is not a Business Day shall be extended to
the next succeeding Business Day, provided, however, if the next succeeding
-------- -------
Business Day would extend the Negotiated Rate Interest Period beyond thirty (30)
days, then the next preceding Business Day; and (c) no Negotiated Rate Interest
Period may be agreed upon that extends beyond the Facility Termination Date.
"Net ▇▇▇▇-to-Market Exposure" of a Person means, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Rate Hedging Agreements. "Unrealized losses"
means the fair market value of the cost to such Person of replacing such Rate
Hedging Agreement as of the date of determination (assuming the Rate Hedging
Agreement were to be terminated as of that date), and "unrealized profits" means
the fair market value of the gain to such Person of replacing such Rate Hedging
Agreement as of the date of determination (assuming such Rate Hedging Agreement
were to be terminated as of that date).
"Non-U.S. Lender" shall have the meaning ascribed in Section 3.5(d).
"Notes" means, collectively, the Revolving Credit Notes and the Credit
Note.
"Notice of Assignment" shall have the meaning ascribed in Section
12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, actual and contingent reimbursement obligations under the
Letters of Credit, all commitment and facility fees, Agent fees, Letter of
Credit fees, all other obligations, indemnities, reimbursements and liabilities
of Borrower to the Lenders or to any Lender or to the Agent or any indemnified
party hereunder in connection with the Facilities of every type and description,
direct or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, or otherwise arising under the Loan Documents whether or
not contemplated by Borrower or the Lenders as of the date hereof, including,
without limitation, all reasonable costs of collection and enforcement of any
and all thereof, including reasonable attorneys' fees.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee.
"Other Taxes" shall have the meaning ascribed in Section 3.5(b).
"Payment Date" means the last day of each August, November, February
and May.
"Participants" shall have the meaning ascribed thereto in Section
12.2.1.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to ERISA, or any successor thereto.
-12-
"Permitted Liens" means, collectively, Liens described under Section
6.14(a), (b) and (c) and judgment Liens not exceeding One Hundred Thousand
Dollars ($100,000).
"Person" means any natural person, corporation, firm, joint venture,
general or limited partnership, limited liability company, association,
enterprise, 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 which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which Borrower or any member of the Controlled Group may have any
liability, including, without limitation, The Finish Line, Inc. Profit Sharing
Plan.
"Prime Rate" means the variable per annum rate of interest established
and quoted by NCB from time to time as its "prime rate," as adjusted on the
effective date of each change in such established and quoted rate, provided that
--------
such prime rate shall not necessarily be representative of the rate of interest
actually charged by NCB on any loan or class of loans.
"Pro Rata Share" means, as to any Lender, when used with reference to
an aggregate or total amount, an amount equal to the product of (a) such
aggregate or total amount, multiplied by (b) a fraction, the numerator of which
---------- --
shall be the sum of such Lender's Revolving Loan Commitment (or, if the
Revolving Loan Commitments have been terminated, the sum of such Lender's
outstanding Revolving Loan and share of the face amount of outstanding Letters
of Credit) and the denominator of which shall be the sum of the total Revolving
Loan Commitments (or, if the Revolving Loan Commitments have been terminated,
the sum of the total outstanding Revolving Loan Advances and the aggregate face
amount of outstanding Letters of Credit).
"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.
"Purchasers" shall have the meaning ascribed in Section 12.3.1.
"Rate Hedging Agreement" means an agreement, device or arrangement
providing for payments which are related to fluctuations of interest rates,
exchange rates or forward rates, 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.
"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 Rate
Hedging Agreements, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Rate Hedging Agreement.
-13-
"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 member banks of the Federal
Reserve System.
"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 member banks of the Federal Reserve System.
"Rentals" means, as of the last day of any fiscal quarter of Borrower,
with respect to Borrower and its Subsidiaries determined on a consolidated
basis, the aggregate amount of rental expense (as determined in accordance with
GAAP) under any Operating Lease (including, without limitation, base rent and
overage rent) for the four (4) consecutive fiscal quarters ending on the date of
determination; provided, however, the amount of any step rent for any such
quarter shall be deducted therefrom.
"Replaced Lender" and "Replacement Lender" shall have the respective
meanings ascribed thereto in Section 12.6.
"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 by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within thirty (30)
days of the occurrence of such event, provided, however, 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
fifty-one percent (51%) of the Revolving Loan Commitments, or if the Revolving
Loan Commitments have been terminated, the outstanding Advances.
"Reserve Requirement" means, for any LIBOR Loan for any LIBOR Interest
Period therefor, the maximum aggregate reserve requirement (including all basic,
supplemental, marginal and other reserves) which is imposed under Regulation D
on "Eurocurrency liabilities" (as such term is used in Regulation D).
"Revolving Loan" means, with respect to a Lender, such Lender's portion
of the outstanding Revolving Loan Advances made by such Lender to Borrower
pursuant to its respective Revolving Loan Commitment, including any extensions
or renewals thereof.
"Revolving Loan Advances" means an Advance under the Revolving Loan
Commitment.
-14-
"Revolving Loan Commitment" means, for each Lender, the obligation of
such Lender to make Revolving Loans not exceeding the amount set forth opposite
such Lender's name on Schedule 1 hereto as such Lender's Revolving Loan
----------
Commitment or as set forth in any Notice of Assignment relating to any
assignment that has become effective pursuant to Section 12.3.2, as such amount
may be modified from time to time pursuant to the terms hereof, and "Revolving
Loan Commitments" means the sum of the Lenders' Revolving Loan Commitments.
"Revolving Credit Notes" means the Revolving Credit Notes, each
substantially in the form of Exhibit A hereto, duly executed by Borrower to the
---------
respective Lenders to evidence the Revolving Loans, including any and all
renewals, extensions, replacements and modifications thereof.
"Risk-Based Capital Guidelines" shall have the meaning ascribed thereto
in Section 3.2.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Single Employer Plan" means a Plan maintained by Borrower or any
member of the Controlled Group for employees of Borrower or any member of the
Controlled Group.
"Subordinated Indebtedness" means Indebtedness of Borrower to a
Wholly-Owned Subsidiary of Borrower which is subordinated to the payment of the
Obligations pursuant to the Guaranty and any other Indebtedness of Borrower the
payment of which is subordinated to payment of the Obligations to the written
satisfaction of the Required Lenders.
"Subsidiary" of a Person means (a) any corporation more than fifty
percent (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, (b) any partnership, limited liability company,
association, joint venture or similar business organization more than fifty
percent (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
Borrower, or (c) any other corporation, partnership, limited liability company,
association, joint venture or similar business organization that may have its
financial statements consolidated with Borrower's financial statements in
accordance with GAAP.
"Substantial Portion" means, with respect to the Property of Borrower
and its Subsidiaries, Property which represents more than ten percent (10%) of
the Consolidated Total Assets as shown in the Financial Statements as at the end
of the most recently completed fiscal quarter.
"Swingline" means the unsecured cash management line of credit in the
maximum principal amount of Five Million Dollars ($5,000,000) provided by NCB to
Borrower, governed by this Agreement, including any renewal or extension
thereof.
-15-
"Swingline Advances" means Advances under the Swingline.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes.
---------
"Transferee" shall have the meaning ascribed thereto in Section 12.4.
"Type" means, with respect to any Advance, its nature as an ABR
Advance, LIBOR Advance or Negotiated Rate Advance.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan 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, limited liability company,
association, joint venture or similar business organization one hundred percent
(100%) of the ownership interests having ordinary voting power of which shall at
the time be so owned or controlled.
1.2. Rules of Construction. The foregoing definitions shall be equally
---------------------
applicable to both the singular and plural forms of the defined terms and shall
be construed accordingly. Use of the terms "herein," "hereof" and "hereunder"
shall be deemed references to this Agreement in its entirety and not to the
Section clause in which such term appears. References to "Sections" and
"subsections" shall be to Sections and subsections, respectively, of this
Agreement unless otherwise specifically provided.
1.3. Accounting Terms. All accounting terms not specifically defined
----------------
herein shall be construed in accordance with GAAP consistent with those applied
in the preparation of the Financial Statements.
-16-
SECTION 2
---------
The Credits
-----------
2.1. Commitments.
-----------
2.1.1. Revolving Loans. Subject to the terms and conditions of
---------------
this Agreement and prior to the Facility Termination Date, each Lender severally
agrees, on the terms and conditions set forth in this Agreement, to make
Revolving Loans to Borrower from time to time in amounts not to exceed in the
aggregate at any one time outstanding the lesser of (a) the amount of its
Revolving Loan Commitment, or (b) an amount equal to such Lender's Pro Rata
Share of the applicable Borrowing Base. No requested Revolving Loan Advance
shall cause the aggregate outstanding principal balance of the Revolving Loan
Advances plus the aggregate outstanding principal balance of the Swingline
----
Advances plus outstanding Letters of Credit and unreimbursed drawings thereunder
----
to exceed the lesser of (a) Revolving Loan Commitments, or (b) the Borrowing
Base. Subject to the terms of this Agreement, Borrower may borrow, repay and
reborrow such available amount under the Revolving Loan Commitments at any time
prior to the Facility Termination Date. The Revolving Loan Commitments to lend
hereunder shall expire on the Facility Termination Date. The Revolving Loans
made by the Lenders pursuant hereto shall be evidenced by the Revolving Credit
Notes.
2.1.2. Swingline. Subject to the terms and conditions of this
---------
Agreement and prior to the Facility Termination Date, NCB shall make the
Swingline available to Borrower in a maximum principal amount equal to the
lesser of (a) the unborrowed portion of its Revolving Loan Commitment, (b) the
sum of the Borrowing Base less outstanding Revolving Loan Advances and
outstanding Letters of Credit and unreimbursed drawings thereunder, or (c) Five
Million Dollars ($5,000,000). No requested Advance shall cause the aggregate
outstanding principal balance of the Swingline Advances to exceed Five Million
Dollars ($5,000,000) and no requested Advance shall cause the aggregate
outstanding principal balance of the Swingline Advances plus the aggregate
----
outstanding principal balance of the Revolving Loan Advances plus outstanding
----
Letters of Credit and unreimbursed drawings thereunder to exceed the lesser of
(a) the Revolving Loan Commitments, or (b) the Borrowing Base. Subject to the
terms of this Agreement, Borrower may borrow, prepay and reborrow such available
amount under the Swingline at any time prior to the Facility Termination Date.
NCB's commitment to make Swingline Advances hereunder shall expire on the
Facility Termination Date. Advances under the Swingline shall be evidenced by
the Credit Note.
2.2. Required Payments: Termination. Any outstanding Advances and all
------------------------------
other unpaid Obligations shall be paid in full by Borrower on the Facility
Termination Date.
2.3. Ratable Loans/Mandatory Funding. With respect to the Revolving
-------------------------------
Loan Commitments, each Advance thereunder shall consist of Revolving Loans made
from the several Lenders in accordance with their respective Pro Rata Share. On
any Business Day, NCB may, in its sole discretion, give notice to the Lenders
that the outstanding principal balance of the Swingline shall be funded with a
Revolving Loan Advance (provided that such notice shall be deemed to have
--------
-17-
been automatically given upon the occurrence of a Default under Section 7.6 or
7.7), in which case an Advance under the Revolving Loan Commitments constituting
an ABR Advance (each such Advance being referred to herein as a "Mandatory
Funding") shall be made on the immediately succeeding Business Day by all
Lenders according to each Lender's Pro Rata Share of the Revolving Loan
Commitments, and the proceeds thereof shall be applied directly to NCB to repay
such outstanding Swingline Advances. Each Lender hereby irrevocably agrees to
make such Revolving Loans, pursuant to each Mandatory Funding in the amount and
in the manner specified in the preceding sentence and on the date specified to
it by NCB notwithstanding: (a) that the amount of the Mandatory Funding may not
comply with the minimum amount for a borrowing specified in Section 2.6; (b)
whether any conditions specified in Section 4 are then satisfied; (c) the date
of such Mandatory Funding; and (d) any reduction in the total Revolving Loan
Commitment after any such Advances under the Swingline were made. In the event
that any Mandatory Funding cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code in respect of Borrower), each Lender
hereby agrees that it shall forthwith purchase from NCB (without recourse or
warranty) such assignment of the outstanding Advances under the Swingline as
shall be necessary to cause such Lenders to share in such Advances ratably based
upon their respective Revolving Loan Commitments, provided that all interest
--------
payable on such Advances shall be for the account of NCB until the date the
respective assignment is purchased and, to the extent attributable to the
purchased assignment, shall be payable to the Lender purchasing same from and
after such date of purchase.
2.4. Types of Advances.
-----------------
2.4.1 Revolving Loans. The Advances under the Revolving Loans
---------------
may be ABR Advances or LIBOR Advances, or a combination thereof,
selected by Borrower in accordance with Sections 2.8.1 and 2.9.
2.4.2 Swingline. The Advances under the Swingline may be ABR
---------
Advances or Negotiated Rate Advances, or a combination thereof,
selected by Borrower in accordance with Section 2.8.2.
2.5. Up Front Fee; Facility Fee; Reductions in Revolving Loan
--------------------------------------------------------
Commitment. Borrower agrees to pay to the Agent, for the account of each Lender
----------
in accordance with their Pro Rata Shares, a non-refundable up front fee equal to
One-Tenth of One Percent (.10%) of the Revolving Loan Commitments. Borrower also
agrees to pay to the Agent, for the account of each Lender in accordance with
their Pro Rata Shares, a non-refundable facility fee accruing at the rate of the
Applicable Facility Fee per annum from and after the date hereof until the
earlier of the Facility Termination Date or the date the Commitments are
terminated pursuant to the terms hereof on the aggregate amount of the Revolving
Loan Commitments in effect from time to time. Such facility fees shall be
payable in advance (a) for the period from the date hereof to November 30, 2000,
payable on the date hereof, and (b) thereafter quarterly in advance on each
Payment Date commencing November 30, 2000. Such facility fees shall not be
refundable for any reason, including, without limitation, any subsequent
reduction of the Revolving Loan Commitments after
-18-
the due date of such facility fees. Borrower may permanently reduce the
Revolving Loan Commitments in whole, or in part ratably among the Lenders in
integral multiples of Five Million Dollars ($5,000,000), upon at least three (3)
Business Days' written notice to the Agent, which notice shall specify the
amount of any such reduction, provided, however, that the amount of the
-------- -------
Revolving Loan Commitments may not be reduced below the aggregate principal
amount of the outstanding Revolving Loan Advances plus the aggregate principal
----
amount of the outstanding Swingline Advances plus the amount of any outstanding
----
Letters of Credit and unreimbursed drawings thereunder.
2.6. Minimum Amount of Each Advance.
------------------------------
2.6.1 Revolving Loans. Except for a Mandatory Funding, each
---------------
Revolving Loan Advance shall be in the minimum amount of Three Million Dollars
($3,000,000) (and in multiples of One Million Dollars ($1,000,000) if in excess
thereof), provided, however, that any ABR Advance may be in the amount of the
-------- -------
unused Revolving Loan Commitments.
2.6.2 Swingline. Each Swingline Advance shall be in the minimum
---------
amount of One Hundred Thousand Dollars ($100,000) (and in multiples of One
Hundred Thousand Dollars ($100,000) if in excess thereof).
2.7. Optional Principal Payments.
---------------------------
2.7.1 Revolving Loans. Except as provided in, and subject to,
---------------
Section 3.4 with respect to LIBOR Advances, Borrower may from time to time, (a)
upon one Business Day notice to the Agent, without penalty or premium, prepay in
full all outstanding Revolving Loan Advances constituting ABR Advances and, if
paid on the last day of the applicable LIBOR Interest Period, LIBOR Advances,
or, prepay in partial prepayment in a minimum aggregate amount of Three Million
Dollars ($3,000,000) or any integral multiple of One Million Dollars
($1,000,000) in excess thereof, any portion of the outstanding Revolving Loan
Advances constituting ABR Advances or, if paid on the last day of the applicable
LIBOR Interest Period, LIBOR Advances, and (b) upon three Business Days notice
to the Agent, without penalty or premium, prepay in full all outstanding
Revolving Loan Advances constituting LIBOR Advances if paid on any day other
than the last day of the applicable LIBOR Interest Period, or, prepay in partial
prepayment in a minimum aggregate amount of Three Million Dollars ($3,000,000)
or any integral multiple of One Million Dollars ($1,000,000) in excess thereof,
any portion of the outstanding Revolving Loan Advances constituting LIBOR
Advances if paid on any day other than the last day of the applicable LIBOR
Interest Period.
2.7.2. Swingline. Borrower may from time to time prepay, without
---------
penalty or premium, all outstanding ABR Advances under the Swingline, or, in the
minimum amount of One Hundred Thousand Dollars ($100,000) or any integral
multiple of One Hundred Thousand Dollars ($100,000) in excess thereof, any
portion of the outstanding ABR Advances under the Swingline. A Negotiated Rate
Advance may not be prepaid prior to the last day of the applicable Negotiated
Rate Interest Period except for a prepayment funded by a Mandatory Funding.
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2.8. Method of Selecting Types and Interest Periods for New Advances.
---------------------------------------------------------------
2.8.1. Revolving Loans. With respect to Revolving Loans (other
---------------
than a Mandatory Funding), Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than 10:00 a.m. (Indianapolis time) on the
Borrowing Date for each ABR Advance and three (3) Business Days before the
Borrowing Date for each LIBOR Advance, specifying:
(a) the Borrowing Date, which shall be a Business Day, of such
Advance,
(b) the aggregate amount of such Advance, and
(c) the Type of Advance selected and, in the case of a LIBOR Advance,
the duration of the LIBOR Interest Period applicable thereto.
The Agent shall notify the Lenders of Borrower's intent to borrow
by 12:00 p.m. (Indianapolis time) on the date it receives a timely Borrowing
Notice from Borrower. Not later than 2:00 p.m. (Indianapolis time) on each
Borrowing Date, each Lender shall make available its Revolving Loan or Revolving
Loans, in funds immediately available in Indianapolis to the Agent at its
address specified pursuant to Section 13. The Agent will make the funds so
received from the Lenders available to Borrower by deposit to the account of
Borrower with NCB.
2.8.2. Swingline. As Borrower desires to obtain Advances under
---------
the Swingline hereunder, Borrower shall give the Agent and NCB a Borrowing
Notice by not later than noon (Indianapolis time), on the Borrowing Date,
specifying: (a) the Borrowing Date, which shall be a Business Day, of such
Advance, and (b) the aggregate amount of such Advance. Each Advance under the
Swingline shall bear interest at the Alternate Base Rate, unless Borrower and
NCB agree to a Negotiated Rate for a Negotiated Rate Interest Period. Subject to
the borrowing limitations set forth in Section 2.1.2, by 2:00 p.m. (Indianapolis
time) on each such Borrowing Date, NCB agrees to make its Advance under the
Swingline to Borrower by deposit to the account of Borrower with NCB.
2.9. Conversion and Continuation of Outstanding Advances. With respect
---------------------------------------------------
to the Revolving Loans, ABR Advances shall continue as ABR Advances unless
converted into LIBOR Advances pursuant to this Section 2.9 or repaid in
accordance with Section 2.7. Each LIBOR Advance shall continue as a LIBOR
Advance until the end of the then applicable LIBOR Interest Period therefor, at
which time such LIBOR Advance shall be automatically converted into an ABR
Advance unless such LIBOR Advance is or was repaid in accordance with Section
2.7 or Borrower shall have given the Agent a Conversion/Continuation Notice
requesting that, at the end of such LIBOR Interest Period, such LIBOR Advance
continue as a LIBOR Advance for the same or another LIBOR Interest Period.
Subject to the terms of Section 2.6, Borrower may elect from time to time to
convert all or any part of an ABR Advance under the Revolving Loan Commitment
into a LIBOR Advance. Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of an ABR Advance into a
LIBOR Advance or continuation of a LIBOR Advance
-20-
not later than 10:00 a.m. (Indianapolis time) at least three (3) Business Days
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 the Advance which is to be
converted or continued, and
(c) the amount of such Advance which is to be converted into or
continued as a LIBOR Advance and the duration of the LIBOR Interest
Period applicable thereto.
2.10. Changes in Interest Rate, etc. Each ABR Advance shall bear interest
-----------------------------
on the outstanding principal amount thereof, for each day from and including the
date such Advance is made to but excluding the date it becomes due at a rate per
annum equal to the Alternate Base Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as an ABR Advance will take
effect simultaneously with each change in the Alternate Base Rate. Each LIBOR
Advance and Negotiated Rate Advance shall bear interest on the outstanding
principal amount thereof from and including the first day of the Interest Period
applicable thereto to (but not including) the last day of such Interest Period
at the interest rate determined as applicable to such LIBOR Advance or such
Negotiated Rate Advance, as applicable. No Interest Period may end after the
Facility Termination Date.
2.11. Rates Applicable After Default. Notwithstanding anything to the
------------------------------
contrary contained in Section 2.8 or 2.9, during the continuance of a Default,
the Required Lenders may, at their option, by notice to Borrower and the Agent
(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 no Advance may be made as,
converted into or continued as a LIBOR Advance. If any Advance is not paid at
maturity, whether by acceleration or otherwise, or during the continuance of a
Default, the Required Lenders may, at their option, by written notice to
Borrower and the Agent (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 (a)
each LIBOR Advance shall bear interest for the remainder of the applicable LIBOR
Interest Period at the rate otherwise applicable to such LIBOR Interest Period
plus Two Percent (2%) per annum, and (b) each ABR Advance shall bear interest at
----
a rate per annum equal to the otherwise applicable rate plus Two Percent (2%)
----
per annum, provided that, during the continuance of a Default under Section 7.6
or 7.7, the interest rates set forth in clauses (a) and (b) above shall be
applicable to all Advances without any election or action on the part of the
Agent or any Lender. If any Advance under the Swingline is not paid at maturity,
whether by acceleration or otherwise, or during the continuance of a Default,
NCB may, at its option, by written notice to Borrower and the Agent (which
notice may be revoked at its option notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that each Swingline Advance shall bear interest at a rate per annum
equal to the otherwise applicable rate plus Two Percent (2%) per annum.
----
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2.12. Method of Payment. All payments of the Obligations hereunder
-----------------
shall be made, without set off, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Section 13, or at any other Lending Installation of the Agent specified in
writing by the Agent to Borrower, by noon (local time) on the date when due and
shall be applied ratably by the Agent among the Lenders in accordance with the
outstanding principal amounts of the Facilities held by them. 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 Section 13 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 Borrower maintained with NCB for each
payment of principal, interest and fees if such payment is not made within three
(3) days of the date it becomes due hereunder.
2.13. Notes; Telephonic Notices. Each Lender is hereby authorized to
-------------------------
record the principal amount of each of its Loans and each repayment on any
schedule attached to its Note, provided, however, that neither the failure to so
record nor any error in such recordation shall affect Borrower's obligations
under such Note. 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 an Authorized Officer. The
Agent may rely, without further inquiry, on all such requests which shall have
been received by it in good faith by anyone reasonably believed to be an
Authorized Officer. 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. 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. Unless the Agent receives written instructions signed by an
Authorized Officer to the contrary, all Advances shall be credited to Borrower's
account with the Agent.
2.14. Interest Payment Dates; Interest and Fee Basis. Interest accrued
----------------------------------------------
on each ABR Advance constituting a Revolving Loan 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 such Advance is prepaid, whether due to
acceleration or otherwise, and at maturity. Interest accrued on each LIBOR
Advance shall be payable on the last day of its applicable LIBOR Interest
Period, or any date on which the LIBOR Advance is prepaid, whether by
acceleration or otherwise, and at maturity. Interest accrued on each LIBOR
Advance having a LIBOR Interest Period longer than three (3) months shall also
be payable on the last day of each three (3) month interval during such LIBOR
Interest Period. Interest and facility fees shall be calculated for actual days
elapsed on the basis of a 360-day year. Interest accrued on each Swingline
Advance shall be payable on the last day of each calendar month, commencing with
the first such date to occur after the date hereof, and at maturity. 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 (local 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.
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2.15. Notification of Advances, Interest Rates, Prepayments and
---------------------------------------------------------
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
---------------------
each Lender of the contents of each Revolving Loan Commitment reduction notice,
Borrowing Notice with respect to Revolving Loans, Conversion/Continuation
Notice, and repayment notice received by it hereunder. The Agent will notify
each Lender of the interest rate applicable to each LIBOR Advance promptly upon
determination of such interest rate and will give each Lender prompt notice of
each change in the Alternate Base Rate.
2.16. 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 Loans and the Notes shall be deemed held by
each Lender for the benefit of such Lending Installation. Each Lender may, by
written notice to the Agent and Borrower, designate replacement or additional
Lending Installations through which Loans will be made by it and for whose
account Loan payments are to be made.
2.17. Non-Receipt of Funds by the Agent. Unless 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 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
such Lender or Borrower, as the case may be, has not in fact made such payment
to the Agent, the recipient of such payment 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 (i) in the case of payment by a Lender, the Federal
Funds Effective Rate for each such day, or (ii) in the case of payment by
Borrower, the interest rate applicable to the relevant Loan.
2.18. Issuance of Letters of Credit. Subject to the terms and
-----------------------------
conditions hereof, the Letter of Credit Issuers agree, upon proper submission of
a Letter of Credit Application by Borrower, to issue on behalf of the Lenders
from time to time prior to the Facility Termination Date, Letters of Credit for
the account of Borrower. The Letters of Credit shall have an expiration date not
later than four (4) days before the expiration of the Facility Termination Date.
The aggregate of the Letters of Credit outstanding plus the aggregate amount of
----
unreimbursed drawings under the Letters of Credit shall not exceed the lesser of
(a) Five Million Dollars ($5,000,000), (b) the Revolving Loan Commitments less
----
outstanding Revolving Loan Advances less outstanding Swingline Advances, or (c)
----
the Borrowing Base less outstanding Revolving Loan Advances less outstanding
---- ----
Swingline Advances. The amount of any Letter of Credit outstanding at any time
for all purposes hereof shall be the maximum amount which could be drawn
thereunder under any circumstances from and after the date of determination.
Each Letter of Credit issued pursuant to this Agreement and each unreimbursed
drawing thereunder shall count against and reduce the Revolving Loan Commitments
by the amount of such Letter of Credit outstanding and each unreimbursed drawing
thereunder unless
-23-
and until such Letter of Credit expires by its terms or otherwise terminates or
the amount of a drawing thereunder is reimbursed, in which event the Revolving
Loan Commitments shall be reinstated by the amount of such Letter of Credit or
the amount of such reimbursement, as the case may be. Each such Letter of Credit
shall be issued pursuant to a Letter of Credit Application and shall conform to
the general requirements of the Letter of Credit Issuer for the issuance of such
credits, as to form and substance, shall be subject to the Uniform Customs and
Practices for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 and shall be a letter of credit which the Letter of
Credit Issuer may lawfully issue. If and to the extent a drawing is at any time
made under any Letter of Credit, the Letter of Credit Issuer shall give notice
on the day of such drawing to Borrower, the Agent and the other Lenders of such
drawing and Borrower agrees to pay to the Letter of Credit Issuer immediately
and unconditionally upon demand for reimbursement, in lawful money of the United
States, an amount equal to each amount which shall be so drawn, together with
interest from the date of such drawing to and including the date such payment is
reimbursed to the Letter of Credit Issuer or converted to Revolving Loans as
provided herein at a variable rate per annum equal to the Alternate Base Rate.
All such interest shall be calculated on the basis that an entire year's
interest is earned in three hundred sixty (360) days. In the event that a
drawing under any Letter of Credit is not reimbursed by Borrower by 11:00 A.M.
(Indianapolis time) on the first Business Day after such notice to Borrower, the
Letter of Credit Issuer shall promptly notify the Agent and the other Lenders by
12:00 noon (Indianapolis time) that Advances under the Revolving Loan
Commitments are required to reimburse the Letter of Credit Issuer. Borrower
hereby irrevocably authorizes the Lenders to refinance, without notice to
Borrower, the reimbursement Obligation of Borrower arising out of any such
drawing under any Letter of Credit into Revolving Loans, evidenced by the
Revolving Credit Notes and for all purposes under, on and subject to the terms
and conditions of this Agreement, but without regard to the conditions precedent
to making an Advance under the Revolving Loan Commitments or to any requirement
of this Agreement that each Revolving Loan be in a minimum amount or multiple,
provided, however, that an Advance under the Revolving Loan Commitments in spite
-------- -------
of Borrower's failure to satisfy any conditions precedent to making an Advance
shall not constitute a waiver of any Default by the Lenders. This Agreement
shall supersede any terms of any Letter of Credit Applications or other
documents which are irreconcilably inconsistent with the terms hereof or
thereof. By 2:00 P.M. (Indianapolis time) on the date the Lenders have received
notice that Advances under the Revolving Loan Commitments are required to
reimburse the Letter of Credit Issuer for draws under the Letters of Credit,
each Lender severally agrees to make its portion of the Revolving Loan then
being made by making available to the Agent, either by wire transfer to the
Agent's main office in Indianapolis, Indiana, or by deposit to any correspondent
account which the Agent may maintain with that Lender, the amount to be advanced
by such Lender. By 2:30 P.M. (Indianapolis time) on such date, the Agent shall
reimburse the Letter of Credit Issuer, but only from funds received by the
Agent, the amount paid on Letters of Credit that date, either by wire transfer
or by deposit to the Letter of Credit Issuer's correspondent account with the
Agent (or as otherwise agreed between the Letter of Credit Issuer and the
Agent).
2.19. Letters of Credit Participation. For administrative convenience,
-------------------------------
the Letter of Credit Issuers shall issue the Letters of Credit for the account
of Borrower pursuant to the arrangements set
-24-
forth herein, and the outstanding portion of each Letter of Credit shall be
deemed to utilize a Pro Rata Share of the Revolving Loan Commitment of each
Lender. Each Lender severally agrees to participate in each Letter of Credit
according to its Pro Rata Share of the Revolving Loan Commitments. Each Lender's
participation shall be funded by funding its Pro Rata Share of the Revolving
Loan Commitments upon any drawing under any Letter of Credit not reimbursed the
same day as a drawing thereunder by Borrower by 2:00 P.M. (Indianapolis time) by
making such funds available to the Agent in accordance with Sections 2.8.1 and
2.18; and thereupon, each such Lender shall be entitled to, and the Letter of
Credit Issuer or the Agent, as applicable, shall remit to each such Lender,
their respective Pro Rata Share of any amounts (including any interest thereon)
received by the Letter of Credit Issuer or the Agent, as applicable, in
reimbursement of such drawing. The Letter of Credit Issuer shall furnish to such
Lenders, each time any Letter of Credit either is issued or drawn under (whether
in whole or in part), (a) a participation certificate showing the aggregate
amount of the Letter of Credit Issuer's Letters of Credit issued and unexpired
or unfunded and the amount of their respective Pro Rata Share thereof, and (b)
such other information with respect to the Letters of Credit as any Lender may
reasonably request from time to time. The obligations of the Lenders to fund
their respective Pro Rata Share of a Revolving Loan for reimbursement of a draw
under a Letter of Credit shall be irrevocable and not subject to counterclaim,
set-off or other defense or any other qualification or exception whatsoever and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances (other than in the case of gross negligence or wilful misconduct
of the Letter of Credit Issuer):
(a) Any lack of validity or enforceability of this Agreement or
any of the other Loan Documents;
(b) The existence of any claim, set-off, defense or other right
which Borrower may have at any time against a beneficiary named in the
Letter of Credit, any transferee of the Letter of Credit (or any Person
for whom any such transferee may be acting), the Agent, the Letter of
Credit Issuer as the Letter of Credit issuer, any Lender, or other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between Borrower and
the beneficiary named in any such Letter of Credit);
(c) Any draft, certificate or other document presented under the
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(d) The surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents; or
(e) The occurrence of any Default or Unmatured Default.
-25-
2.20. Compensation for Letters of Credit.
----------------------------------
2.20.1. Letter of Credit Fee. Borrower shall pay to the Letter
--------------------
of Credit Issuer, for the ratable benefit of the Lenders in accordance
with their Revolving Loan Commitments, a Letter of Credit fee at a per
annum rate equal to the Applicable Margin of each Letter of Credit
outstanding hereunder, such fee to be calculated on the basis of a
three hundred sixty (360) day year and to be paid annually in advance
upon the issuance of such Letter of Credit and on each anniversary date
thereafter. If any payment of a Letter of Credit fee shall become due
on a day that is not a Business Day, such payment shall be made on the
next succeeding Business Day.
2.20.2. Additional Letter of Credit Fees. In addition to the
--------------------------------
foregoing Letter of Credit fees, Borrower shall pay to the Letter of
Credit Issuer, for such Letter of Credit Issuer's own account, such
Letter of Credit Issuer's reasonable and customary costs of issuing,
servicing and negotiating draws under letters of credit.
2.20.3. Manner of Payment. Borrower authorizes the Letter of
-----------------
Credit Issuer to collect all such fees by deducting the amount thereof
from the deposit account of Borrower if such fees are not paid within
three (3) days of their respective due date.
2.21. Reimbursement of Letters of Credit. The obligation of Borrower
----------------------------------
to reimburse any drawing under any Letter of Credit shall be absolute,
unconditional and irrevocable and shall be paid and performed strictly in
accordance with the terms of this Agreement under all circumstances, including,
without limitation, the following, other than in the case of gross negligence or
willful misconduct of the Agent or a Lender:
(a) Any lack of validity or enforceability of any Letter of
Credit, or any Loan Document;
(b) Any amendment or waiver of or consent to departure from
the terms of any Letter of Credit, or any Loan Document;
(c) The existence of any claim, set-off, defense or other
right which Borrower may have at any time against the beneficiary or
any Letter of Credit, any transferee of any Letter of Credit, the
Lenders or any other Person, whether in connection with the Loan
Documents, such Letter of Credit, or any unrelated transaction;
(d) Any statement, draft or other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever;
(e) The surrender or impairment of any security for the
performance or observance of the terms of the Loan Documents or such
Letter of Credit; or
-26-
(f) Any circumstance, happening or admission whatsoever,
whether or not similar to any of the foregoing, including, without
limitation, those matters described below.
Except as expressly set forth herein, Borrower assumes all risks for the acts,
omissions, or misrepresentations of the parties benefitted by any Letter of
Credit. Neither a Letter of Credit Issuer nor any of its Affiliates or
correspondents shall be responsible for (a) the validity, sufficiency,
truthfulness or genuineness of any document required to draw under the Letters
of Credit even if such document should in fact prove to be in any or all
respects invalid, insufficient, fraudulent or forged, (b) the failure of any
draft to bear reference or adequate reference to such Letter of Credit or
failure of any Person to note the amount of any draft on such Letter of Credit
or to surrender or take up such Letter of Credit, or (c) errors, omissions,
interruptions, or delays in transmission or delivery of any messages or
documents, provided, however, that Borrower shall have a claim against a Letter
-------- -------
of Credit Issuer, and a Letter of Credit Issuer shall be liable to Borrower, to
the extent of any compensatory, as opposed to consequential, damages suffered by
Borrower which Borrower proves were caused by (i) such Letter of Credit Issuer's
failure to act in good faith or to observe general banking usage in connection
with the Letter of Credit or failure to examine documents presented under such
Letter of Credit with care to determine whether they comply with the terms of
such Letter of Credit (it being understood that Bank assumes no liability or
responsibility for the genuineness, falsification or effect of any document
which appears on such examination to be regular on its face) or (ii) the gross
negligence or willful misconduct of a Letter of Credit Issuer. Without limiting
the generality of the foregoing, Borrower agrees that any action taken by a
Letter of Credit Issuer or any of its Affiliates or correspondents under or in
connection with any Letter of Credit, if taken in good faith and without gross
negligence, shall be binding upon Borrower and shall not put a Letter of Credit
Issuer or any such Affiliates or correspondents under any such resulting
liability to Borrower. A Letter of Credit Issuer shall not be liable for action
or failure to take action under or in connection with any Letter of Credit
except for any such action or failure to take action which constitutes gross
negligence or wilful misconduct. A Letter of Credit Issuer shall not be liable
for consequential damages in connection with any Letter of Credit. A Letter of
Credit Issuer is expressly hereby authorized to honor any request for payment
which is made under or in compliance with the terms of any Letter of Credit
without regard to, and without any duty on its part to inquire into, the
existence of any disputes or controversies between Borrower and any beneficiary
of any Letter of Credit or any other Person or into respective rights, duties or
liabilities of any of them or whether any facts or occurrences represented in
any of the documents presented under any Letter of Credit are true and correct.
No Person, other than the parties hereto, shall have any rights of any nature
under this Agreement or by reason hereof. In no event shall a Letter of Credit
Issuer's reliance and payment against documents presented under a Letter of
Credit appearing on its face to substantially comply with the terms thereof be
deemed to constitute gross negligence or wilful misconduct.
2.22 Use of Proceeds. The proceeds of Advances under the Revolving
---------------
Loans and the Swingline shall be used for lawful corporate purposes not
prohibited by this Agreement.
-27-
SECTION 3
---------
YIELD PROTECTION; TAXES
-----------------------
3.1. Yield Protection. If, on or after the date of this Agreement, the
----------------
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(a) subjects any Lender or any applicable Lending Installation
to any Taxes, or changes the basis of taxation of payments (other than
with respect to Excluded Taxes) to any Lender in respect of its LIBOR
Loans, 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 LIBOR 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 its LIBOR Loans or reduces any amount
receivable by any Lender or any applicable Lending Installation in
connection with its LIBOR Loans, or requires any Lender or any
applicable Lending Installation to make any payment calculated by
reference to the amount of LIBOR Loans held or interest received by it,
by an amount deemed material by such Lender, and the result of any of
the foregoing is to increase the cost to such Lender or applicable
Lending Installation or making or maintaining its LIBOR Loans or
Commitment or to reduce the return received by such Lender or
applicable Lending Installation in connection with such LIBOR Loans or
Commitment, then, within fifteen (15) days of demand by such Lender,
Borrower shall pay such Lender such additional amount or amounts as
will compensate such Lender for such increased cost or reduction in
amount received.
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 fifteen (15) days of written
demand by such Lender, 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 reasonably determines is attributable to
this Agreement, its Loans or its Commitment to make Loans hereunder (after
taking into account such Lender's policies as to capital
-28-
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 (i) the risk-based
capital guidelines in effect in the United States on the date of this Agreement,
including transition rules, and (ii) 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," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement.
3.3. Availability of Types of Advances. If any Lender reasonably
---------------------------------
determines that maintenance of its LIBOR 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 reasonably
determine that (a) deposits of a type and maturity appropriate to match fund
LIBOR Advances are not available, or (b) the interest rate applicable to a Type
of LIBOR Advance does not accurately reflect the cost of making or maintaining
such LIBOR Advance, then the Agent shall suspend the availability of the
affected Type of LIBOR Advances of the affected Lender or Lenders, as the case
may be, and require those LIBOR Advances of the affected Type to be repaid or,
at Borrower's option, converted to another Type of Advance, subject to the
payment of any funding indemnification amounts required by Section 3.4.
3.4. Funding Indemnification. If any payment (whether mandatory or
-----------------------
optional) of a LIBOR Advance occurs on a date which is not the last day of the
applicable LIBOR Interest Period, whether because of acceleration, prepayment or
otherwise, or a LIBOR Advance is not made on the date specified by Borrower for
any reason other than default by the Lenders, Borrower will indemnify 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 the LIBOR Advance.
3.5. Taxes. (a) All payments by Borrower to or for the account of any
-----
Lender or the Agent hereunder or under any Note shall be made free and clear of
and without deduction for any and all Taxes. If Borrower shall be required by
law to deduct any Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section 3.5) such Lender or the Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) Borrower shall make such deductions, (iii)
Borrower shall pay the full amount deducted to the relevant authority in
accordance with applicable law, and (iv) Borrower shall furnish to the Agent the
original copy of a receipt evidencing payment thereof within thirty (30) days
after such payment is made.
-29-
(b) In addition, Borrower hereby agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any Note or
from the execution or delivery of, or otherwise with respect to, this Agreement
or any Note ("Other Taxes").
(c) Borrower hereby agrees to indemnify the Agent and each Lender for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed on amounts payable under this Section 3.5) paid by
the Agent or such Lender and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. Payments due under this
indemnification shall be made within thirty (30) days of the date the Agent or
such Lender makes demand therefor pursuant to Section 3.6.
(d) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof (each a "Non-U.S. Lender") agrees that it
will, not less than ten (10) Business Days after the date of this Agreement, (i)
deliver to each of 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 without
deduction or withholding of any United States federal income taxes, and (ii)
deliver to each of Borrower and the Agent a United States Internal Revenue Form
W-8 or W-9, as the case may be, and certify that it is entitled to an exemption
from United States backup withholding tax. Each Non-U.S. Lender further
undertakes to deliver to each of Borrower and the Agent (x) renewals or
additional copies of such form (or any successor form) on or before the date
that such form expires or becomes obsolete, and (y) after the occurrence of any
event requiring a change in the most recent forms so delivered by it, such
additional forms or amendments thereto as may be reasonably requested by
Borrower or the Agent. All forms or amendments described in the preceding
sentence shall certify that such Lender is entitled to receive payments under
this Agreement 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 or amendment with respect to it and such Lender advises Borrower and the
Agent that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
(e) For any period during which a Non-U.S. Lender has failed to provide
Borrower with an appropriate form pursuant to clause (d) above, such Non-U.S.
Lender shall not be entitled to indemnification under this Section 3.5 with
respect to Taxes imposed by the United States; provided that, should a Non-U.S.
Lender which is otherwise exempt from or subject to a reduced rate of
withholding tax become subject to Taxes because of its failure to deliver a form
required under clause (d) above, Borrower shall take such steps as such Non-U.S.
Lender shall reasonably request to assist such Non-U.S. Lender to recover such
Taxes.
(f) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Note
pursuant to the law of any relevant
-30-
jurisdiction or any treaty shall deliver to Borrower (with a copy to the Agent),
at the time or times prescribed by applicable law, such properly completed and
executed documentation prescribed by applicable law as will permit such payments
to be made without withholding or at a reduced rate.
3.6. Lender Statements; Survival of Indemnity. To the extent reasonably
----------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Revolving Loans to reduce any liability of Borrower to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of a Type
of Advance under Section 3.3, so long as such designation is not, in the
reasonable judgment of such Lender, disadvantageous to such Lender. Each Lender
shall deliver a written statement of such Lender to Borrower (with a copy to the
Agent) as to the amount due, if any, under Sections 3.1, 3.2, 3.4 or 3.5. 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 Borrower in the absence of manifest error. Such written statement
shall be sent by a Lender within ninety (90) days after such Lender could
reasonably calculate the amount due under Sections 3.1, 3.2, 3.4 or 3.5;
provided, however, that if a Lender fails to send such written statement within
such ninety (90) day period, such Lender shall not be prohibited or restricted
from collecting, and Borrower shall indemnify such Lender for, amounts due in
respect of Sections 3.1,3.2, 3.4 or 3.5 for periods from and after the date
ninety (90) days prior to the date that such Lender sends such written
statement, but not for any prior periods. Determination of amounts payable under
such Sections in connection with a Revolving Loan shall be calculated as though
each Lender funded its Revolving Loan through the purchase of a deposit of the
type and maturity corresponding to the deposit used as a reference in
determining the applicable rate 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 Borrower of
such written statement. The obligations of Borrower under Sections 3.1, 3.2, 3.4
and 3.5 shall survive payment of the Obligations and termination of this
Agreement.
SECTION 4
---------
CONDITIONS PRECEDENT
--------------------
4.1. Initial Advance. The Lenders shall not be required to make the
---------------
initial Advance hereunder and NCB shall not be obligated to issue any Letter of
Credit unless Borrower has furnished to the Agent, with sufficient copies for
the Lenders, the following:
(a) Copies, certified by the Secretary or Assistant Secretary of
Borower and each Guarantor, of the certificate or articles of
incorporation of Borrower and each Guarantor, together with all
amendments, and a certificate of good standing or existence certified by
the appropriate governmental officer in its jurisdiction of
incorporation.
(b) Copies, certified by the Secretary or Assistant Secretary of
Borrower and each Guarantor, of its by-laws and of its Board of
Directors' resolutions (and resolutions of other
bodies, if any are reasonably deemed necessary by counsel for any Lender)
authorizing the execution of the Loan Documents.
(c) An incumbency certificate, executed by the Secretary or Assistant
Secretary of Borrower and each Guarantor, which shall identify by name and
title and bear the signature of the officers of Borrower and each Guarantor
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 in writing of any change by Borrower or such Guarantor, as
applicable.
(d) A certificate, signed by the chief financial officer of Borrower,
stating that on the initial Borrowing Date no Default or Unmatured Default
has occurred and is continuing.
(e) A written opinion of Borrower's and Guarantor's counsel,
addressed to the Agent in the form approved by the Lenders.
(f) Notes payable to the order of each of the Lenders.
(g) Written money transfer instructions, in substantially the form of
Exhibit F hereto, 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.
(h) The Guaranty, duly executed by each Guarantor.
(i) Satisfactory return after search in accordance with the Uniform
Commercial Code from the states of Indiana, Illinois and Ohio.
(j) The insurance certificate described in Section 5.19.
(k) An executed and completed Compliance Certificate.
(l) The facility fees due and payable in accordance with Section 2.5
and the other fees due and payable in accordance with the Fee Letter.
(m) Concurrently with the initial Advance under the Facilities,
Borrower shall have prepaid and repaid all outstanding obligations for
borrowed money under that certain Credit Agreement dated as of July 10,
1998, among Borrower and the lenders party thereto, except for
reimbursement obligations owed in connection with existing outstanding
letters of credit issued thereunder for the account of Borrower.
(n) A Borrowing Base certificate, in a form approved by the Agent,
executed by the chief financial officer of Borrower evidencing the
Borrowing Base as of the date hereof.
(o) Such other documents as the Agent or its counsel may have
reasonably requested.
4.2. Each Advance. The Lenders shall not be required to make any
------------
Advance (other than an Advance that, after giving effect thereto and to the
application of the proceeds thereof, does not increase the aggregate amount of
outstanding Advances), and NCB shall not be obligated to issue a Letter of
Credit, unless on the applicable Borrowing Date or the proposed date of issuance
of a Letter of Credit, as the case may be:
(a) There exists no Default or Unmatured Default and no Default
or Unmatured Default would result from the making of a requested
Advance.
(b) The representations and warranties contained in Section 5
are true and correct as of such Borrowing Date except to the extent any
such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall be
true and correct on and as of such earlier date.
Each Borrowing Notice with respect to each such Advance shall
constitute a representation and warranty by Borrower that the conditions
contained in Sections 4.2(a) and (b) have been satisfied.
SECTION 5
---------
REPRESENTATIONS AND WARRANTIES
------------------------------
Borrower represents and warrants to the Lenders that:
5.1. Corporate Existence and Standing. Each of Borrower and its
--------------------------------
Subsidiaries is a corporation duly incorporated, validly existing and, if
applicable, in good standing under the laws of its jurisdiction of incorporation
and has all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
5.2. Authorization and Validity. Borrower has the corporate power and
--------------------------
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by Borrower of
the Loan Documents and the performance of its obligations thereunder have been
duly authorized by proper corporate proceedings, and the Loan Documents
constitute legal, valid and binding obligations of Borrower enforceable against
Borrower 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. No Conflict; Government Consent. Neither the execution and
-------------------------------
delivery by Borrower of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on Borrower or any of its Subsidiaries or
Borrower's or any Subsidiary's articles of incorporation or by-laws or the
provisions of any material indenture, instrument or agreement to which Borrower
or any of its Subsidiaries 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 in, of or on the Property of
Borrower or a Subsidiary pursuant to the terms of any such indenture, instrument
or agreement. No order, consent, approval, license, authorization, or validation
of, or filing, recording or registration with, or exemption by, or other action
in respect of any governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in connection with the
execution, delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
5.4. Financial Statements. The Financial Statements heretofore
--------------------
delivered to the Lenders were prepared in accordance with GAAP in effect on the
dates such statements were prepared and fairly present in all material respects
the consolidated financial condition and operations of Borrower and its
Subsidiaries at such dates and the consolidated results of their operations for
the periods then ended.
5.5. No Material Adverse Change. Since May 27, 2000, there has been no
--------------------------
change in the business, Property, condition (financial or otherwise) or results
of operations of Borrower and its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect.
5.6. Taxes. Borrower and its Subsidiaries have filed all United
-----
States federal 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 Borrower or any of its Subsidiaries, except such taxes,
if any, as are being contested in good faith and as to which adequate reserves
have been provided in accordance with GAAP. The United States income tax returns
of Borrower and its Subsidiaries have been audited by the Internal Revenue
Service through the fiscal year ended December, 1995. 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 Borrower and its Subsidiaries in respect
of any taxes or other governmental charges are adequate in all material
respects.
5.7. Litigation and Contingent Obligations. Except as set forth on
-------------------------------------
Schedule 5.7 hereto, no litigation, arbitration, governmental investigation,
------------
proceeding or inquiry pending or, to the knowledge of any of their officers,
threatened against or affecting Borrower or any of its Subsidiaries could
reasonably be expected to have a Material Adverse Effect or seeks to prevent,
enjoin or delay the making of the Loans or Advances. Except as set forth on
Schedule 5.7 hereto, Borrower has no material contingent obligations not
------------
provided for or disclosed in the Financial Statements.
5.8. Subsidiaries. Schedule 5.8 hereto contains an accurate list of
------------ ------------
all Subsidiaries of Borrower as of the date of this Agreement, setting forth
their respective jurisdictions of incorporation and the percentage of their
respective capital stock owned by Borrower or other Subsidiaries. All
of the issued and outstanding shares of capital stock of such Subsidiaries have
been duly authorized and issued and are fully paid and non-assessable.
5.9. ERISA. Each Plan complies in all material respects with all
-----
applicable requirements of law and regulations, no Reportable Event has occurred
with respect to any Plan, neither Borrower nor any other members of the
Controlled Group has withdrawn from any Plan or initiated steps to do so, and no
steps have been taken to reorganize or terminate any Plan, except with respect
to each of the foregoing for noncompliance, occurrences, withdrawal, initiation
or steps that could not reasonably be expected to have a Material Adverse
Effect.
5.10. Accuracy of Information. No information, exhibit or report
-----------------------
furnished by Borrower or any of its Subsidiaries to the Agent or to any Lender
in connection with the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact or omitted to state a material fact
necessary to make the statements contained therein not misleading.
5.11. Regulation U. Margin stock (as defined in Regulation U)
------------
constitutes less than twenty-five percent (25%) of those assets of Borrower and
its Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder.
5.12. Material Agreements. Neither Borrower nor any Subsidiary is a
-------------------
party to any agreement or instrument or subject to any charter or other
corporate restriction the performance of or compliance with which could
reasonably be expected to have a Material Adverse Effect. Neither Borrower nor
any Subsidiary is in default in the performance, observance or fulfillment of
any of the obligations, covenants or conditions contained in (a) any agreement
to which it is a party, which default could reasonably be expected to have a
Material Adverse Effect, or (b) any agreement or instrument evidencing or
governing Indebtedness exceeding Ten Million Dollars ($10,000,000).
5.13. Compliance With Laws. Borrower and its Subsidiaries are in
--------------------
compliance 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 Property if failure to comply
could reasonably be expected to have a Material Adverse Effect.
5.14. Ownership of Properties. Borrower and its Subsidiaries will have
-----------------------
good title, free of all Liens other than those permitted by Section 6.14, to all
of the Property and assets reflected in the Financial Statements as owned by it,
except for Property disposed of since the date of the Financial Statements in
the ordinary course of business.
5.15. Plan Assets; Prohibited Transactions. Borrower is not an entity
------------------------------------
deemed to hold "plan assets" within the meaning of 29 C.F.R. (S) 2510.3-101 of
an employee benefit plan (as defined in Section 3(3) of ERISA) which is subject
to Title I of ERISA or any plan (within the meaning of Section 4975 of the
Code); and neither the execution of this Agreement and the making of Loans
hereunder do not give rise to a prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business,
---------------------
Borrower considers the effect of Environmental Laws on the business of Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
potential risks and liabilities accruing to Borrower due to Environmental Laws.
On the basis of this consideration, Borrower and its Subsidiaries are in
compliance with all Environmental Laws, non-compliance with which, singly or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
Neither Borrower nor any Subsidiary has received any notice to the effect that
its operations are not in material compliance with any of the requirements of
applicable Environmental Laws or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
release of any toxic or hazardous waste or substance into the environment, which
non-compliance or remedial action could reasonably be expected to have a
Material Adverse Effect.
5.17. Investment Company Act. Neither Borrower nor any Subsidiary
----------------------
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
5.18. Public Utility Holding Company Act. Neither 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.
5.19. Insurance. The certificate signed by the President or Chief
---------
Financial Officer of Borrower, that attests to the existence and adequacy of,
and summarizes, the property and casualty insurance program carried by Borrower
with respect to itself and its Subsidiaries and that has been furnished by
Borrower to the Agent and the Lenders, is complete and accurate. This summary
includes the insurer's or insurers' name(s), policy number(s), expiration
date(s), amount(s) of coverage, type(s) of coverage, exclusion(s), and
deductibles. This summary also includes similar information, and describes any
reserves, relating to any self-insurance program that is in effect.
5.20. Solvency. (a) Immediately following the making of each Loan, and
--------
after giving effect to the application of the proceeds of such Loans, (i) the
fair value of the assets of Borrower and its Subsidiaries on a consolidated
basis, at a fair valuation, will exceed the debts and liabilities, subordinated,
contingent or otherwise, of Borrower and its Subsidiaries on a consolidated
basis; (ii) the present fair saleable value of the Property of Borrower and its
Subsidiaries on a consolidated basis will be greater than the amount that will
be required to pay the probable liability of Borrower and its Subsidiaries on a
consolidated basis on their debts and other liabilities, subordinated,
contingent or otherwise, as such debts and other liabilities become absolute and
matured; (iii) Borrower and its Subsidiaries on a consolidated basis will be
able to pay their debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured; and (iv) Borrower and
its Subsidiaries on a consolidated basis will not have unreasonably small
capital with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
thereof.
(b) Borrower does not intend to, or intend to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.
SECTION 6
---------
COVENANTS
---------
During the term of this Agreement and until the Obligations have been
fully performed and paid in full, and so long as any Commitment is outstanding,
unless the Required Lenders shall otherwise consent in writing:
6.1. Financial Reporting. Borrower will maintain, for itself and each
-------------------
Subsidiary, a system of accounting established and administered in accordance
with GAAP, and furnish to the Lenders:
(a) Within ninety (90) days after the close of each of its
fiscal years, financial statements of Borrower and its Subsidiaries
certified by a firm of independent certified public accountants
acceptable to the Lenders, prepared in accordance with GAAP 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, related
statements of income and retained earnings and a consolidated statement
of cash flows, accompanied by (i) the unqualified opinion of such
accountants that such consolidated financial statements present fairly,
in all material respects, the consolidated financial position of
Borrower and its Subsidiaries as of the date thereof and the results of
their consolidated operations and their cash flows for the fiscal year
then ended, and (ii) a certificate of said accountants that, in the
course of their examination necessary for the issuance of their opinion
on the consolidated financial statements, they have obtained no
knowledge of any 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, which certificate shall be in
substantially the form of Exhibit G hereto.
---------
(b) Within forty-five (45) days after the close of the first
three (3) quarterly periods of each of its fiscal years, for itself and
the Subsidiaries, consolidated and consolidating unaudited balance
sheets as at the close of each such period and consolidated and
consolidating statements of income and retained earnings and a
consolidated statement of 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.
(c) Together with the financial statements required under
Sections 6.1(a) and (b), a compliance certificate in substantially the
form of Exhibit C hereto signed by its chief financial officer 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.
(d) Within twenty (20) days after the close of each fiscal
quarter, a Borrowing Base certificate, in a form approved by the Agent,
executed by the chief financial officer of Borrower evidencing the
Borrowing Base as of the close of the immediately preceding fiscal
quarter, showing the calculation thereof and the outstanding principal
amount of the Facilities, and, if there exists any outstanding
Advances, Borrower shall also furnish such Borrowing Base certificate
within twenty (20) days after the end of each calendar month for the
immediately preceding calendar month.
(e) As soon as possible and in any event within ten (10) days
after Borrower knows that any Reportable Event has occurred with
respect to any Plan which could reasonably be expected to have a
Material Adverse Effect, a statement, signed by the chief financial
officer of Borrower, describing such Reportable Event and the action
which Borrower proposes to take with respect thereto.
(f) As soon as possible and in any event within ten (10) days
after receipt by Borrower, a copy of (i) any notice or claim to the
effect that Borrower or any of its Subsidiaries is or may be liable to
any Person as a result of the release by Borrower, any of its
Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, and (ii) any notice alleging any
violation of any federal, state or local environmental, health or
safety law or regulation by Borrower or any of its Subsidiaries, which,
in either case, could, singly or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(g) Promptly upon the furnishing thereof to the shareholders of
Borrower, copies of all financial statements, reports and proxy
statements so furnished.
(h) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports
which Borrower or any of its Subsidiaries files with the Securities and
Exchange Commission.
(i) 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. Borrower will, and will cause each Subsidiary
---------------
to, use the proceeds of the Facilities solely for the purposes herein described.
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). Further, no part of the proceeds of the Facilities
will be used for any purpose that violates the provisions of Regulations T, U or
X of the Board of Governors.
6.3. Notice of Default. Borrower will, and will cause each Subsidiary
-----------------
to, give prompt notice in writing to the Lenders of the occurrence of any
Default or Unmatured Default known to Borrower and of any other development,
financial or otherwise, known to Borrower which is reasonably likely to have a
Material Adverse Effect.
6.4. Conduct of Business. Borrower will, and will cause each
-------------------
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and in fields of enterprise reasonably related thereto and do all
things necessary to remain duly incorporated, validly existing and, if
applicable, 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 the failure to maintain such requisite authority
could reasonably be expected to have a Material Adverse Effect.
6.5. Taxes. 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 law and pay when due all 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 in accordance
with GAAP.
6.6. Insurance. 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, and Borrower will furnish to the Agent upon request
full information as to the insurance carried.
6.7. Compliance with Laws. 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,
non-compliance with which, singly or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
6.8. Maintenance of Properties. 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.
6.9. Inspection. Borrower will, and will cause each Subsidiary to,
----------
permit the Agent and the Lenders, by their respective representatives and
agents, during normal business hours and upon reasonable notice, to inspect any
of the Property, corporate books and financial records of Borrower and each
Subsidiary, to examine and make copies of the books of accounts and other
financial records of Borrower and each Subsidiary, and to discuss the affairs,
finances and accounts of
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.
6.10. Dividends. At any time there then exists a Default or Unmatured
---------
Default or if a Default or Unmatured Default would be occasioned thereby, (a)
Borrower will not, nor will it permit any Subsidiary to, declare or pay any
dividends or make any distributions on its capital stock (other than dividends
payable in its own capital stock and except that any Subsidiary may declare and
pay dividends or make distributions to Borrower), and (b) Borrower will not, nor
will it permit any Subsidiary to, redeem, repurchase or otherwise acquire or
retire any of its outstanding capital stock from any Person other than Borrower.
6.11. Merger. Borrower will not, nor will it permit any Subsidiary to,
------
merge or consolidate with or into any other Person, except (a) that a Subsidiary
may merge into Borrower or a Wholly-Owned Subsidiary, and (b) as permitted in
Section 6.13.
6.12. Sale of Assets. Borrower will not, nor will it permit any
--------------
Subsidiary to, lease, sell or otherwise dispose of its Property, or discount,
with or without recourse, any of its accounts or notes receivable, except:
(a) Sales of inventory and discounts of its accounts receivable
in the ordinary course of business.
(b) Sale and Leaseback Transactions as permitted by Section
6.19.
(c) Leases, sales or other dispositions of its Property
(exclusive of Sale and Leaseback Transactions) that, together with all
other Property of Borrower and its Subsidiaries previously leased, sold
or disposed of (other than inventory in the ordinary course of
business) as permitted by this Section during the twelve-month period
ending with the month in which any such lease, sale or other
disposition occurs, do not constitute a Substantial Portion of the
Property of Borrower and its Subsidiaries.
(d) Leases, sales or other dispositions of its Property
(exclusive of Sale and Leaseback Transactions) that exceed the
limitation set forth in Section 6.12(c) above; provided, that (i) there
then exists no Default or Unmatured Default and Borrower provides the
Agent a satisfactory pro forma Compliance Certificate showing
compliance with all financial covenants, and (ii) the aggregate
Revolving Loan Commitments are reduced in accordance with Section 2.5
by an amount at least equal to the amount of such excess.
6.13. Investments and Acquisitions. 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 create any Subsidiary or become or
remain a partner in any partnership or joint venture, or make any Acquisition of
any Person, except:
(a) Short-term obligations of, or fully guaranteed by, the
United States of America.
(b) Commercial paper rated A-1 or better by Standard and Poor's
Ratings Services, a division of McGraw Hill Companies, Inc. or P-1 or
better by ▇▇▇▇▇'▇ Investors Service, Inc.
(c) Demand deposit accounts maintained in the ordinary course of
business.
(d) Certificates of deposit maturing within one hundred eighty
(180) days issued by and time deposits maturing within one hundred
eighty (180) days with commercial banks (whether domestic or foreign)
having capital and surplus in excess of One Hundred Million Dollars
($100,000,000).
(e) Short-term tax exempt securities rated BBB or better by S&P
or Baa2 or better by Moody's.
(f) Existing Investments in Subsidiaries and other Investments
in existence on the date hereof and described on Schedule 6.13 hereto.
-------------
(g) Other Investments (valued at cost) not exceeding seven and
one-half percent (7-1/2%) of Consolidated Tangible Net Worth in the
aggregate outstanding at any one time.
(h) Borrower and its Subsidiaries may (i) create Subsidiaries
having no material assets or operations, solely for the purpose of
facilitating an Acquisition permitted hereunder, (ii) create (but not
acquire except pursuant to Section 6.13(i) and (j)) Subsidiaries in
substantially the same field of enterprise or in a reasonably related
field of enterprise as currently conducted by Borrower and its
Subsidiaries as determined in the reasonable judgment of the Agent, and
(iii) create or acquire Subsidiaries pursuant to an Acquisition
permitted pursuant to Section 6.13(i) and (j).
(i) Acquisitions, provided (i) no Default or Unmatured Default
has occurred and is continuing at the time of such Acquisition or will
result or occur after consummation of such Acquisition, (ii) the entity
or business acquired is in substantially the same field of enterprise
or in a reasonably related field of enterprise as currently conducted
by Borrower and its Subsidiaries as determined in the reasonable
judgment of the Agent (including, without limitation, retail apparel
enterprises, retail athletic related enterprises and retail footwear
enterprises), (iii) the total purchase price (including the assumption
of liabilities pursuant thereto) for all Acquisitions permitted
pursuant to this Section 6.13(i) (including after giving effect to the
subject Acquisition) consummated in any fiscal year of Borrower does
not exceed Ten Million Dollars ($10,000,000), and (iv) in the event of
a merger to which Borrower is a party, Borrower is the surviving
entity.
(j) Acquisitions that exceed or would exceed the purchase price
limitations contained in Section 6.13(i)(iii), provided (i) no Default
or Unmatured Default has occurred and is continuing at the time of such
Acquisition, (ii) Borrower provides written evidence satisfactory to
the Agent (which written evidence shall be promptly furnished by the
Agent to the Lenders) that it is in compliance with the covenants
contained in Section 6 both immediately before and after giving effect
to consummation of the Acquisition, and further provides a satisfactory
pro forma Compliance Certificate showing compliance with all financial
covenants on a consolidated basis for Borrower, its Subsidiaries and
the target business or entity to be acquired for the preceding 12-month
period based solely on historical results, but after giving effect to
the proposed terms of the Acquisition, (iii) the entity or business
acquired is in substantially the same field of enterprise or in a
reasonably related field of enterprise as currently conducted by
Borrower and its Subsidiaries as determined in the reasonable judgment
of the Agent (including, without limitation, retail apparel
enterprises, retail athletic related enterprises and retail footwear
enterprises), which determination by the Agent shall be made within
five (5) Business Days after the Agent has received the information
described in sub-paragraph (ii) above and a brief written description
of the proposed Acquisition in reasonable detail, and (iv) in the event
of a merger to which Borrower is a party, Borrower is the surviving
entity.
(k) Acquisitions that are not otherwise permitted pursuant to
Sections 6.13(i)(ii) or (j)(iii), provided (i) no Default or Unmatured
Default has occurred and is continuing at the time of such Acquisition
or will result or occur after consummation of such Acquisition, (ii)
the total purchase price (including the assumption of liabilities
pursuant thereto) for all Acquisitions permitted pursuant to this
Section 6.13(k) (including after giving effect to the subject
Acquisition) consummated in any fiscal year of Borrower does not exceed
Ten Million Dollars ($10,000,000) and (iii) in the event of a merger to
which Borrower is a party, Borrower is the surviving entity.
Nothing contained in this Section 6.13 shall be deemed to restrict the
Investments of any Plan.
6.14. Liens. 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 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.
(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 payment of obligations not more than sixty
(60) days past due, or are being contested in good faith by appropriate
proceedings.
(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) Utility easements, building restrictions and such other
encumbrances or charges against real property 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 Borrower or
the Subsidiaries.
(e) Liens securing aggregate outstanding Indebtedness of
Borrower and its Subsidiaries not exceeding at any time an amount equal
to five percent (5%) of Borrower's Consolidated Total Assets.
(f) Purchase money Liens upon Property (other than current
assets) created in the ordinary course of business encumbering only
such Property acquired and the proceeds thereof, and securing only the
purchase price thereof.
(g) Purchase money Liens upon inventory created in the ordinary
course of business encumbering only such inventory acquired and the
Proceeds thereof, and securing only the purchase price thereof,
provided, that the aggregate amount of such inventory subject to Liens
at any time does not exceed ten percent (10%) of the consolidated
inventory of Borrower and its Subsidiaries and the Indebtedness secured
by such inventory is not outstanding more than ninety (90) days.
(h) Liens existing on the date hereof and described in Schedule
--------
6.14 hereto, including any extensions, renewals, replacements and
----
modifications not increasing the principal balance of the Indebtedness
secured thereby.
(i) Liens assumed by Borrower securing Indebtedness assumed by
Borrower in connection with an Acquisition as permitted by Section 6.13
and 6.11.
(j) Liens arising from judgments in circumstances not
constituting a Default under Section 7.9.
(k) Any extensions, renewals, replacements and modifications of
the foregoing permitted Liens (other than the Liens permitted pursuant
to Section 6.14(g)) so long as the principal balance of the
Indebtedness secured thereby is not increased.
6.15. Indebtedness. Borrower will not, nor will it permit any
------------
Subsidiary to, create, incur or suffer to exist any Indebtedness except: (a)
Indebtedness to the Lenders pursuant to the Loan Documents, (b) that in
existence on the date hereof and disclosed in the Financial Statements,
including any extensions, renewals, replacements and modifications not
increasing the principal balance thereof, (c) Indebtedness of Borrower and its
Subsidiaries secured by a Lien permitted under
Section 6.14, (d) Subordinated Indebtedness of Borrower to any Wholly-Owned
Subsidiary of Borrower that is a guarantor of the Obligations, (e) Indebtedness
of a Subsidiary to Borrower permitted pursuant to Section 6.13, (f) unsecured
Indebtedness of Borrower and its Subsidiaries not exceeding in the aggregate ten
percent (10%) of Borrower's Consolidated Total Assets outstanding at any time,
(g) outstanding letters of credit existing as of the date hereof issued for the
account of Borrower, provided such letters of credit are not renewed or extended
beyond their existing expiry dates, and (h) except as otherwise provided herein,
any extensions, renewals, replacements and modifications of the foregoing
permitted Indebtedness not increasing the principal balance thereof.
6.16. Capital Expenditures. Borrower will not, nor will it permit any
--------------------
Subsidiary to, expend in the aggregate for Borrower and its Subsidiaries on a
non-cumulative basis for Capital Expenditures in excess of (a) Twenty-Seven
Million Five Hundred Thousand Dollars ($27,500,000) during the fiscal year
ending 2001, (b) Thirty Million Two Hundred Fifty Thousand Dollars ($30,250,000)
during the fiscal year ending 2002, (c) Thirty-Three Million Two Hundred
Seventy-Five Thousand Dollars ($33,275,000) during the fiscal year ending 2003,
and Thirty-Six Million Six Hundred Two Thousand Five Hundred Dollars
($36,602,500) during the fiscal year ending 2004.
6.17. Consolidated Tangible Net Worth. Borrower will at all times
-------------------------------
maintain its Consolidated Tangible Net Worth at not less than Two Hundred Eleven
Million Dollars ($211,000,000) as of August 26, 2000, and thereafter increasing
effective as of the last day of each subsequent fiscal quarter of Borrower by an
amount equal to (a) fifty percent (50%) of Consolidated Net Income (without
reduction for any net losses) for such fiscal quarter, plus (b) eighty percent
----
(80%) of the proceeds (net of reasonable and customary brokerage commissions,
underwriting fees and discounts, and legal fees, finder's fees and other similar
fees and commissions incurred in connection therewith) received in such quarter
from any equity offerings (whether private or public) which adds to
stockholder's equity (exclusive of proceeds received with respect to the
issuance or exercise of any warrants, rights or options to acquire shares of
capital stock).
6.18. Leverage Ratio. Borrower will maintain its Leverage Ratio of not
--------------
greater than 4.0 to 1.0 as of the last day of each fiscal quarter of Borrower.
6.19. Sale and Leaseback. Borrower will not, nor will it permit any
------------------
Subsidiary to, enter into any Sale and Leaseback Transaction which, when
combined with all other Sale and Leaseback Transactions entered into by Borrower
and its Subsidiaries at any one time, would result in the aggregate sale
proceeds to exceed a Substantial Portion.
6.20. Restrictive Agreements. Borrower will not, nor will it permit
----------------------
any Subsidiary to, enter into any agreement prohibiting (a) the creation or
assumption of any Lien upon its Property, except for provisions contained in
documents evidencing Liens permitted under Sections 6.14(e), (f), (g), (h) and
(i) that restrict the ability to further encumber the Property secured thereby,
(b) the ability of Borrower to amend or otherwise modify this Agreement or any
other Loan Document, or (c) the ability of any Subsidiary to make any payments,
directly or indirectly, to Borrower by way of dividends, advances, repayments of
loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments, or
any other agreement or arrangement which restricts the ability of any such
Subsidiary to make any payment, directly or indirectly, to Borrower.
6.21. New Guarantors. Borrower will cause each new Subsidiary (other
--------------
than a Subsidiary organized or incorporated outside the United States of
America), whether hereafter created or acquired by Borrower or a Subsidiary
pursuant to Section 6.13, to execute and deliver to the Agent a Guaranty. Such
Guaranty shall be executed and delivered within thirty (30) days of the initial
capitalization or Acquisition of such Subsidiary but in any event not later than
the date Borrower obtains an Advance hereunder to be used in connection with, or
related to, such capitalization or Acquisition or otherwise used in connection
with such new Subsidiary's business. With delivery to the Agent of such
Guaranty, Borrower shall also furnish, or cause to be furnished, to the Agent
(a) copies of the certificate or articles of incorporation of such Guarantor,
together with all amendments, and a certificate of good standing or existence,
both certified by the appropriate governmental officer in its jurisdiction of
incorporation; (b) copies, certified by the Secretary or Assistant Secretary of
such Guarantor, of its by-laws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are reasonably deemed necessary by counsel
for any Lender) authorizing the execution of the Guaranty; (c) an incumbency
certificate, executed by the Secretary or Assistant Secretary of such Guarantor,
which shall identify by name and title and bear the signature of the officers of
such Guarantor authorized to sign the Guaranty; and (d) a favorable written
opinion of such Guarantor's counsel, addressed to the Agent in a form acceptable
to the Agent, opining (i) as to such Guarantor's existence, (ii) as to such
Guarantor's authorization to execute the Guaranty, (iii) as to the
enforceability of the Guaranty, and (iv) that the execution and performance of
the Guaranty will not conflict with or result in a breach under any material
contract, indenture, instrument or other agreement by which such Guarantor is
bound or to which it is party.
6.22. Affiliates. Except for agreements and transactions with Spike's
----------
Holding, Inc., 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 in the ordinary course of business and pursuant to the reasonable
requirements of Borrower's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to Borrower or such Subsidiary than Borrower
or such Subsidiary would obtain in a comparable arms-length transaction.
6.23. Accounting Policies. Borrower will not, and will not permit any
-------------------
Subsidiary to, change its fiscal year or any of its significant accounting
policies, except to the extent necessary to comply with GAAP.
6.24. Subordinated Indebtedness. Borrower will not, and will not permit
-------------------------
any Subsidiary to, make any amendment or modification to any indenture, note or
other agreement evidencing or governing any Subordinated Indebtedness without
the written consent of the Agent, or directly or indirectly voluntarily prepay,
defease or in substance defease, purchase, redeem, retire or otherwise acquire,
any Subordinated Indebtedness.
SECTION 7
---------
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 Borrower or any of its Subsidiaries to the Lenders or the Agent under
or in connection with this Agreement, any Loan, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be materially false on the date as of which made.
7.2. Nonpayment of principal of any Loan when due, or nonpayment of
interest upon any Loan or of any facility fee or other obligations under any of
the Loan Documents within five (5) Business Days after the same becomes due.
7.3. The breach by Borrower of any of the terms or provisions of
Section 6.1(e)-(i), 6.2, 6.3, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.17,
6.18, 6.19, 6.20, 6.21, 6.22, 6.23 or 6.24; or the breach by Borrower of Section
6.1(a), (b), (c) or (d) which is not remedied within five (5) days of the breach
thereof.
7.4. The breach by 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 Borrower or any of its Subsidiaries to pay when due
(after giving effect to any grace periods) any Indebtedness having an
outstanding principal balance, singly or in the aggregate, in excess of Ten
Million Dollars ($10,000,000) ("Material Indebtedness"); or the breach by
Borrower or any of its Subsidiaries of any term, provision or condition
contained in any agreement under which any such Material Indebtedness was
created or is governed, which constitutes a default thereunder, or any other
event shall occur or condition exist, the effect of which is to cause, or to
permit the holder or holders of such Material Indebtedness to cause, such
Material Indebtedness to become due prior to its stated maturity; or any
Material Indebtedness of Borrower or any of its Subsidiaries shall be declared
to be due and payable or required to be prepaid or repurchased (other than by a
regularly scheduled payment) prior to the stated maturity thereof; or Borrower
or any of its Subsidiaries shall not pay, or admit in writing its inability to
pay, its debts generally as they become due.
7.6. 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, or (f) fail
to contest in good faith any appointment or proceeding described in Section 7.7.
7.7. Without the application, approval or consent of Borrower or any
of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for 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 Borrower or any of its Subsidiaries and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of forty-five (45) 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 Borrower and its Subsidiaries which, when
taken together with all other Property of 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. Borrower or any of its Subsidiaries shall fail within thirty (30)
days to pay, bond or otherwise discharge any judgment or order for the payment
of money in excess of Ten Million Dollars ($10,000,000), which is not stayed on
appeal or otherwise being appropriately contested in good faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall
exceed in the aggregate Ten Million Dollars ($10,000,000), or any Reportable
Event shall occur in connection with any Plan which could reasonably be expected
to have a Material Adverse Effect.
7.11. Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
Borrower or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification), exceeds Ten Million Dollars
($10,000,000).
7.12. Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of Title IV
of ERISA, and such reorganization or termination could reasonably be expected to
have a Material Adverse Effect.
7.13. Any Change in Control shall occur.
7.14. The occurrence of any "default", as defined in any Loan Document
(other than this Agreement) or the breach of any of the terms or provisions of
any Loan Document (other than this Agreement), which default or breach continues
beyond any period of grace therein provided.
7.15. Any 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 any Guaranty, or any Guarantor shall fail to comply with any
of the terms or provisions of any Guaranty to which it is a party, or any
Guarantor shall deny that it has any further liability under any Guaranty to
which it is a party, or shall give notice to such effect.
SECTION 8
---------
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1. Acceleration. If any Default described in Section 7.6 or 7.7
------------
occurs with respect to 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 Borrower hereby expressly waives.
If, within thirty (30) 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 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 Borrower, rescind and annul such acceleration and/or termination.
8.2. Amendments. Subject to the provisions of this Section 8, the
----------
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions of the Loan Documents or changing
in any manner the rights of the Lenders or Borrower hereunder or waiving any
Default hereunder, provided, however, that no such supplemental agreement shall,
-------- -------
without the consent of each Lender affected thereby:
(a) Extend the maturity of any Loan or Note or forgive all or
any portion of 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) Extend the Facility Termination Date or reduce the amount or
extend the payment date for, the mandatory payments required under
Section 2.2, or increase the amount of the Commitment of any Lender
hereunder, or permit Borrower to assign its rights under this
Agreement.
(d) Amend this Section 8.2.
(e) Release any Guarantor of any Advance.
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 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 Required Lenders or each of the affected Lenders as
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.
SECTION 9
---------
GENERAL PROVISIONS
------------------
9.1. Survival of Representations. All representations and warranties
---------------------------
of Borrower contained in this Agreement shall survive delivery of the Notes and
the making of the Loans herein contemplated until full, final and irrevocable
payment and satisfaction of the Obligations (except as otherwise expressly
provided herein).
9.2. Governmental Regulation. Anything contained in this Agreement to
-----------------------
the contrary notwithstanding, no Lender shall be obligated to extend credit to
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. 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.
9.4. Entire Agreement. The Loan Documents embody the entire agreement
----------------
and understanding among Borrower, the Agent and the Lenders and supersede all
prior agreements and understandings among Borrower, the Agent and the Lenders
relating to the subject matter thereof.
9.5. 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, provided, however, that the parties
-------- -------
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.9 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6. Expenses; Indemnification. Borrower shall reimburse the Agent and
-------------------------
the Arranger for any reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, 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, syndication, review, amendment, modification,
and administration of the Facilities and/or the Loan Documents, subject to any
limitations set forth in the Fee Letter. Borrower also agrees to reimburse the
Agent, the Arranger and the Lenders for any costs, internal charges and
out-of-pocket expenses (including reasonable 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. Notwithstanding the foregoing, Borrower shall
not be required to reimburse the Agent, the Arranger or any Lender for both of
such Person's outside attorneys' fees and time charges of attorneys that are
employees of such Person to the extent such fees are incurred in connection with
the same services rendered for such Person. Expenses being reimbursed by
Borrower under this Section include, without limitation, reasonable costs and
expenses incurred in connection with audit and inspection reports prepared by,
and/or furnished to, the Lenders pursuant to the terms of this Agreement.
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 the direct or indirect application or
proposed application of the proceeds of any Loan hereunder except to the extent
that they are determined by a court of competent jurisdiction in a final and
non-appealable order to have resulted from the gross negligence or willful
misconduct of the party seeking indemnification. The obligations of Borrower
under this Section shall survive the termination of this Agreement.
9.7. 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.
9.8. 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.
9.9. Relationship of Parties; Mutual Release of Consequential Damages.
----------------------------------------------------------------
The relationship between Borrower and the Lenders and the Agent shall be solely
that of borrower and lender. Neither the Agent, the Arranger nor any Lender
shall have any fiduciary responsibilities to Borrower. Neither the Agent, the
Arranger nor any Lender undertakes any responsibility to Borrower to review or
inform Borrower of any matter in connection with any phase of Borrower's
business or operations. Neither the Agent, the Arranger, any Lender nor Borrower
shall have any liability with respect to, and Borrower, each Lender, the
Arranger and the Agent hereby waives, releases and agrees not to ▇▇▇ for, any
special or consequential damages suffered by it in connection with, arising out
of, or in any way related to the Loan Documents or the transactions contemplated
thereby.
9.10. Confidentiality. The Agent and each Lender agrees to hold any
---------------
confidential information which it may receive from Borrower pursuant to this
Agreement in confidence, except for (a) confidential disclosure to its
Affiliates and to other Lenders and their respective Affiliates, (b)
confidential disclosure to legal counsel, accountants, and other professional
advisors to that Lender or to a Transferee, (c) required disclosure to
regulatory officials, (d) disclosure to any Person as required by law,
regulation, or legal process, (e) required disclosure to any Person in
connection with any legal proceeding to which that Lender is a party, and (f)
disclosure as permitted by Section 12.4.
9.11. Nonreliance. Each Lender hereby represents that it is not relying
-----------
on or looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Loans provided
for herein.
SECTION 10
----------
THE AGENT
---------
10.1. Appointment; Nature of Relationship. National City Bank of
-----------------------------------
Indiana is hereby appointed by each of the Lenders as its contractual
representative (herein referred to as the "Agent") hereunder and under each
other Loan Document, and each of the Lenders irrevocably authorizes the Agent to
act as the contractual representative of such Lender with the rights and duties
expressly set forth herein and in the other Loan Documents. The Agent agrees to
act as such contractual
representative upon the express conditions contained in this Section 10.
Notwithstanding the use of the defined term "Agent," it is expressly understood
and agreed that the Agent shall not have any fiduciary responsibilities to any
Lender by reason of this Agreement or any other Loan Document and that the Agent
is merely acting as the representative of the Lenders with only those duties as
are expressly set forth in this Agreement and the other Loan Documents. In its
capacity as the Lenders' contractual representative, the Agent (a) does not
hereby assume any fiduciary duties to any of the Lenders, (b) is a
"representative" of the Lenders within the meaning of Section 9-105 of the
Uniform Commercial Code, and (c) is acting as an independent contractor, the
rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents. Each of the Lenders hereby agrees to
assert no claim against the Agent on any agency theory or any other theory of
liability for breach of fiduciary duty, all of which claims each Lender hereby
waives.
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 Borrower, the Lenders 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 to
the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
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 Section 4, except
receipt of items required to be delivered solely to the Agent, (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of Borrower or any guarantor
of any of the Obligations or of any of Borrower's or any such guarantor's
respective Subsidiaries. The Agent shall have no duty to disclose to the Lenders
information that is not required to be furnished by Borrower to the Agent at
such time, but is voluntarily furnished by Borrower to the Agent (either in its
capacity as Agent or in its individual capacity), provided, however, upon a
-------- -------
Lender's request for information furnished by Borrower to the Agent in its
capacity as Agent hereunder, the Agent shall provide a copy of such information
promptly to such Lender.
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 by each of the affected Lenders pursuant to Section 8.2, 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 Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders or by each of the affected Lenders pursuant to Section 8.2,
as applicable. 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 the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's 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 reasonably 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 Borrower for which the Agent is entitled to reimbursement by
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 Facilities and/or Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders), 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 Facilities and/or
the Loan Documents or any other document delivered in connection therewith or
the transactions contemplated thereby (including, without limitation, for any
such amounts incurred by or asserted against the Agent in connection with any
dispute between the Agent and any Lender or between two or more of the Lenders),
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 any of the foregoing is found in a final non-appealable
judgment by a court of competent jurisdiction to have resulted 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 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 and its Affiliates 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 Borrower or any of its Subsidiaries in which 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, the Arranger or any other
Lender and based on the Financial Statements 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, the Arranger 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 Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five (45) days after the retiring Agent gives notice
of its intention to resign. The Agent may be removed at any time with or without
cause by written notice received by the Agent from the Required Lenders, such
removal to be effective on the date specified by the Required Lenders. Upon any
such removal, the Required Lenders shall have the right to appoint, on behalf of
Borrower and the Lenders, a successor Agent. If no successor Agent shall have
been so appointed by the Required Lenders within thirty (30) days after the
resigning Agent's giving notice of its intention to resign, then the resigning
Agent may appoint, on behalf of Borrower and the Lenders, a successor Agent.
Notwithstanding the previous sentence, the Agent may at any time without the
consent of Borrower or any Lender, appoint any of its Affiliates which is a
commercial bank as a successor Agent hereunder. If the Agent has resigned or
been removed and no successor Agent has been appointed, the Lenders may perform
all the duties of the
Agent hereunder and 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 One Hundred Million Dollars ($100,000,000). 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 or removed Agent. Upon the effectiveness
of the resignation or removal of the Agent, the resigning or removed Agent shall
be discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation or removal of an Agent,
the provisions of this Section 10 shall continue in effect for the benefit of
such Agent 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. In the
event that there is a successor to the Agent by merger, or the Agent assigns its
duties and obligations to an Affiliate pursuant to this Section 10.12, then the
term "Prime Rate" as used in this Agreement shall mean the prime rate, base rate
or other analogous rate of the new Agent.
10.13. Agent's Fee. Borrower agrees to pay the Agent, for its own
-----------
account, the fees agreed to by Borrower and the Agent pursuant to the Fee
Letter, or as otherwise agreed from time to time by Borrower and the Agent.
10.14. Delegation to Affiliates. Borrower and the Lenders agree that
------------------------
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Sections 9 and 10.
SECTION 11
----------
SET OFF; RATABLE PAYMENTS
-------------------------
11.1. Set off. In addition to, and without limitation of, any rights
-------
of the Lenders under applicable law, if 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 or any Affiliate of any Lender to or for
the credit or account of 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 set off or otherwise,
----------------
has payment made to it upon its Loans (other than payments received pursuant to
Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that received by any
other Lender in terms of its Pro Rata Share, 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 after
taking into effect the
aforementioned payment and purchase. If any Lender, whether in connection with
set off or amounts which might be subject to set off or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to set off, 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.
SECTION 12
----------
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 Borrower, the
Lenders and the Agent and their respective successors and assigns, except that
(a) 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 Borrower or the Agent, assign all
or any portion of its rights under this Agreement and any Note 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 Person which made any Loan or which holds any Note as the
owner thereof for all purposes hereof unless and until such Person 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 the rights to any Loan or any Note agrees by acceptance of such
transfer or assignment 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 Borrower under this
Agreement shall be determined as if such Lender had not sold such
participating interests,
and 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 with respect to any Loan or
Commitment in which such Participant has an interest which forgives
principal, interest or fees or reduces the interest rate or fees
payable with respect to any such Loan or Commitment, extends the
Facility Termination Date, postpones any date fixed for any regularly-
scheduled payment of principal of, or interest or fees on, any such
Loan or Commitment, releases any guarantor of any such Loan or releases
all or substantially all of the collateral, if any, securing any such
Loan.
12.2.3. Benefit of Set off. Borrower agrees that each Participant
------------------
shall be deemed to have the right of set off 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 set off
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 set
off provided in Section 11.1, agrees to share with each Lender, any
amount received pursuant to the exercise of its right of set off, such
amounts to be shared in accordance with Section 11.2 as if each
Participant were a Lender.
12.3. Assignments.
-----------
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 Eligible Assignees ("Purchasers") all or any
part of its rights and obligations under the Loan Documents. Any
assignment pursuant to this Section 12.3.1 shall be substantially in
the form of Exhibit E hereto or in such other form as may be agreed to
---------
by the parties thereto. The written consent of Borrower and the Agent
shall be required prior to an assignment becoming effective with
respect to a Purchaser which is not (a) a Lender, (b) an Affiliate of a
Lender, which such Affiliate is organized under the laws of the United
States or any state thereof, or (c) an Affiliate of a Lender, which
such Affiliate has a Lending Installation in the United States,
provided, however, that if a Default has occurred and is continuing,
-------- -------
the consent of Borrower shall not be required. Such consents shall not
be unreasonably withheld or delayed. Each such assignment shall (unless
each of Borrower and the Agent otherwise consents) be in an amount not
less than the lesser of (y) Five Million Dollars ($5,000,000), or (z)
the remaining amount of the assigning Lender's Commitment (calculated
as of the date of such assignment).
12.3.2. Effect; Effective Date. Upon (a) delivery to the Agent of
----------------------
a notice of assignment, substantially in the form of Exhibit I to
---------
Exhibit E hereto (a "Notice of Assignment"), together with any consents
---------
required by Section 12.3.1, and (b) payment of a Three Thousand Five
Hundred Dollar ($3,500) fee to the Agent for processing such
assignment, such assignment shall become effective on the effective
date specified in such Notice of Assignment. The Notice of Assignment
shall contain a representation by the Purchaser to the effect that none
of the consideration used to make the purchase of the Commitment and
Loans under the applicable assignment agreement are "plan assets" as
defined under ERISA and that the rights and interests of the Purchaser
in and under the Loan Documents will not be "plan assets" under ERISA.
On and after the effective date of such assignment, 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 no further
consent or action by Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to the
percentage of the Commitment and Loans assigned to such Purchaser. Upon
the consummation of any assignment to a Purchaser pursuant to this
Section 12.3.2, the transferor Lender, the Agent and 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 in principal amounts
reflecting their respective Commitments, as adjusted pursuant to such
assignment.
12.4. Dissemination of Information. Subject to Section 9.10, 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 any prospective Transferee any and all information in such
Lender's possession concerning the creditworthiness of Borrower and its
Subsidiaries, including, without limitation, any information contained in any
audit and inspection reports; provided that each Transferee and prospective
Transferee agrees to be bound by Section 9.10.
12.5. Tax Treatment. If any interest in any Loan Document is
-------------
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 3.5(d).
12.6. Replacement of Lenders. Upon a Lender charging to Borrower
----------------------
increased costs in excess of those being generally charged by the other Lenders,
Borrower shall have the right, in accordance with the requirements of Section
12.3, if no Default will exist after giving effect to such replacement, to
replace such Lender (the "Replaced Lender") with an Eligible Assignee or
Eligible Assignees (collectively, the "Replacement Lender"), reasonably
acceptable to the Agent, provided that at the time of any replacement pursuant
to this Section, the Replacement Lender shall enter into one or more Assignment
Agreements pursuant to which the Replacement Lender shall acquire all the
Commitments and outstanding Loans of, and in each case participation in Letters
of Credit by,
the Replaced Lender and, in connection therewith, shall, together with Borrower,
pay to the Replaced Lender in respect thereof an amount equal to the sum of (a)
an amount equal to the principal of, and all accrued interest on, all
outstanding Loans of the Replaced Lender, (b) an amount equal to all accrued,
but theretofore unpaid, fees owing to the Replaced Lender, and (c) all
Obligations of the Borrower owing to the Replaced Lender (other than those
specifically described in clause (a) above in respect of which the assignment
purchase price has been, or is concurrently being, paid) shall be paid in full
to such Replaced Lender concurrently with such replacement.
SECTION 13
----------
NOTICES
-------
13.1. Notices. Except as otherwise permitted by Section 2.13 with
-------
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (a)
in the case of Borrower or the Agent, at its address or facsimile number set
forth on the signature pages hereof, (b) in the case of any Lender, at its
address or facsimile number set forth on Schedule 1 hereto, or (c) in the case
----------
of any party, at such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agent and Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (i) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Section 2 shall not be
--------
effective until received.
13.2. Change of Address. 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.
SECTION 14
----------
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 Borrower, the Agent
and the Lenders and each party has notified the Agent by facsimile transmission
or telephone that it has taken such action.
SECTION 15
----------
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
------------------------------------------------------------
15.1. 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 (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF INDIANA, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2. CONSENT TO JURISDICTION. BORROWER HEREBY IRREVOCABLY SUBMITS TO
-----------------------
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR INDIANA STATE
COURT SITTING IN INDIANAPOLIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS AND 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 BORROWER IN THE
COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY 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
INDIANAPOLIS, INDIANA.
15.3. WAIVER OF JURY TRIAL. 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.
IN WITNESS WHEREOF, Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
[THIS SPACE LEFT INTENTIONALLY BLANK]
SIGNATURE PAGE OF
THE FINISH LINE, INC.
TO
CREDIT AGREEMENT
THE FINISH LINE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇, Executive Vice President,
General Counsel and Secretary
Address:
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-61-
SIGNATURE PAGE OF
NATIONAL CITY BANK OF INDIANA
TO
CREDIT AGREEMENT
NATIONAL CITY BANK OF INDIANA,
individually and as Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: V.P.
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One ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
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Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-62-
SIGNATURE PAGE OF
UNION PLANTERS BANK, NATIONAL ASSOCIATION
TO
CREDIT AGREEMENT
UNION PLANTERS BANK, NATIONAL
ASSOCIATION
By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇
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Its: VP
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Attention: ▇▇▇▇▇ ▇. ▇'▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-63-
SIGNATURE PAGE OF
FIRSTAR BANK, N.A.
TO
CREDIT AGREEMENT
FIRSTAR BANK, N.A.
By: /s/ C A Black
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Its: Senior Vice President
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▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. Black
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-64-
SIGNATURE PAGE OF
THE NORTHERN TRUST COMPANY
TO
CREDIT AGREEMENT
THE NORTHERN TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Its: Vice President
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-65-
SIGNATURE PAGE OF
LASALLE BANK, NATIONAL ASSOCIATION
TO
CREDIT AGREEMENT
LASALLE BANK NATIONAL
ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Its: VP
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Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-66-
Schedule 1-Lenders
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Lenders
and Addresses Revolving Loan Commitments
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National City Bank of Indiana $20,000,000
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Union Planters Bank, National Association $10,000,000
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇'▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Firstar Bank, N.A. $10,000,000
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇▇▇ ▇. Black
Fax: ▇▇▇-▇▇▇-▇▇▇▇
The Northern Trust Company $10,000,000
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
LaSalle Bank National Association $10,000,000
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
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$60,000,000
Schedule 5.7
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Litigation and
Contingent Obligations
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None
Schedule 5.8
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Subsidiaries
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Name Jurisdiction Ownership %
---- ------------ -----------
Spike's Holding, Inc. Delaware 100%
Schedule 6.13
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Other Existing Investments
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None
Schedule 6.14
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Liens
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None
EXHIBIT A
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REVOLVING CREDIT NOTE
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$ __________________ Date: September 20, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
FOR VALUE RECEIVED, THE FINISH LINE, INC., a Delaware corporation
("Borrower"), hereby promises to pay to the order of ___________________ (the
"Lender"), or its assigns, at the main office of NATIONAL CITY BANK OF INDIANA
(the "Agent"), as Agent under the Agreement (hereinafter defined) in the City of
Indianapolis, Indiana, or at such other place as the holder hereof may designate
in writing, the lesser of (a) principal sum of _________________________Dollars
($ __________), or (b) the aggregate unpaid principal amount of all Revolving
Loans made by the Lender to the Borrower pursuant to Section 2 of the Agreement,
in lawful money of the United States of America and in immediately available
funds, together with interest on the unpaid principal balance existing from time
to time at the per annum rates and on the dates set forth in the Agreement. The
Borrower shall pay the principal and accrued and unpaid interest on the
Revolving Loans in full on the Facility Termination Date, and shall make such
mandatory payments as are required to be made under the terms of Section 2 of
the Agreement.
The Lender shall, and is hereby authorized to, record on any schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Revolving Loan under this Note and the date and
amount of each principal payment hereunder.
This Note is issued pursuant to, is entitled to the benefit of, and is
subject to the provisions of that certain Credit Agreement dated as of even date
herewith among Borrower, the lenders party thereto, including the Lender, and
National City Bank of Indiana, as the Agent for the Lenders (as the same may be
amended from time to time, the "Agreement"), to which Agreement reference is
hereby made for a statement of the terms and conditions governing this Note,
including, without limitation, the terms and conditions under which this Note
may be prepaid or its maturity date accelerated. This Note is guaranteed, as
more specifically described in the Agreement, and reference is made thereto for
a statement of the terms and provisions thereof. Capitalized terms used herein
and not otherwise defined herein are used with the meanings attributed to them
in the Agreement.
Subject to any applicable grace or cure period set forth in the Agreement,
if Borrower fails to make the payment of any installment of principal or
interest, as provided in the Agreement, or upon the occurrence of any other
Default, then in any of such events, or at any time thereafter prior to such
Default being cured, the entire principal balance of this Note, and all accrued
and unpaid
================================================================================
Page 1 of a Note containing Two Pages, dated September 20, 2000 from THE FINISH
LINE, INC. to ________________________.
interest thereon, irrespective of the maturity date specified herein or in the
Agreement, together with reasonable attorneys' fees and other costs incurred in
collecting or enforcing payment or performance hereof and with interest from the
date of Default on the unpaid principal balance hereof at the Default rate
specified in Section 2.11 of the Agreement, shall, at the election of the
Required Lenders (except as otherwise provided for automatic acceleration on the
occurrence of certain Defaults specified in the Agreement), and without relief
from valuation and appraisement laws, become immediately due and payable.
Borrower and all endorsers, guarantors, sureties, accommodation parties
hereof and all other parties liable or to become liable for all or any part of
this indebtedness, severally waive demand, presentment for payment, notice of
dishonor, protest and notice of protest and expressly agree that this Note and
any payment coming due under it may be extended or otherwise modified from time
to time without in any way affecting their liability hereunder.
Notice of acceptance of this Note by the Lender is hereby waived.
BORROWER, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS NOTE OR
ANY OTHER LOAN DOCUMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS NOTE OR
ANY COURSE OF CONDUCT, DEALING, STATEMENTS, WHETHER ORAL OR WRITTEN, OR ACTIONS
OF BORROWER OR ANY OF THE LENDERS. BORROWER SHALL NOT SEEK TO CONSOLIDATE, BY
COUNTERCLAIM OR OTHERWISE, ANY ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH
ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE
PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR
RELINQUISHED BY THE LENDERS EXCEPT BY WRITTEN INSTRUMENT EXECUTED BY BORROWER,
THE LENDER AND THE OTHER LENDERS.
IN WITNESS WHEREOF, Borrower has caused this Note to be executed by its
duly authorized officer as of the day and year first hereinabove written.
THE FINISH LINE, INC.
By: _________________________
Its: ________________________
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Page 2 of a Note containing Two Pages, dated September 20, 2000 from THE FINISH
LINE, INC. to ________________________.
SCHEDULE OF REVOLVING LOANS
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AND PAYMENTS OF PRINCIPAL
-------------------------
BORROWER: THE FINISH LINE, INC.
NOTE DATED: SEPTEMBER 20, 2000
Principal Maturity
Amount Type of Interest Amount of Unpaid
Date of Loan of Loan Period Principal Repaid Balance Maturity
---- ------- ------- ------ ---------------- ------- --------
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
EXHIBIT B
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CREDIT NOTE
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(Swingline)
$5,000,000.00 Dated: September 20, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
FOR VALUE RECEIVED, THE FINISH LINE, INC., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of NATIONAL CITY BANK OF
INDIANA, a national banking association ("NCB"), or its assigns, at its
principal office at Indianapolis, Indiana, or at such other place as the holder
hereof may designate in writing, in lawful money of the United States of America
and in immediately available funds, the principal sum of Five Million Dollars
($5,000,000), or so much thereof as may be advanced and outstanding from time to
time, together with interest on the unpaid principal balance existing from time
to time at the per annum rates and on the dates set forth in the Agreement
(hereinafter defined). The Borrower shall pay the principal and accrued and
unpaid interest on this Note in full on the Facility Termination Date, and shall
make such mandatory payments as are required to be made under the terms of
Section 2 of the Agreement.
NCB shall, and is hereby authorized to, record on any schedule attached
hereto, or to otherwise record in accordance with its usual practice, the date
and amount of each Advance under this Note and the date and amount of each
principal payment hereunder.
This Note is issued pursuant to, is entitled to the benefit of, and is
subject to the provisions of that certain Credit Agreement of even date herewith
among Borrower, the lenders party thereto, and NCB, individually and as Agent
(as the same may be amended from time to time, the "Agreement"), to which
Agreement reference is hereby made for a statement of the terms and conditions
governing this Note, including, without limitation, the terms and conditions
under which this Note may be prepaid or its maturity date accelerated. This Note
is guaranteed, as more specifically described in the Agreement, and reference is
made thereto for a statement of the terms and provisions thereof. Capitalized
terms used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
Subject to any applicable grace or cure period set forth in the Agreement,
if Borrower fails to make the payment of any installment of principal or
interest, as herein provided, when due, or upon the occurrence of any other
Default, then in any of such events, or at any time thereafter prior
================================================================================
Page 1 of a Note containing Two Pages, dated September 20, 2000 from THE FINISH
LINE, INC. to NATIONAL CITY BANK OF INDIANA
to such Default being cured, the entire principal balance of this Note, and all
accrued and unpaid interest thereon, irrespective of the maturity date specified
herein, together with reasonable attorneys' fees and other costs incurred in
collecting or enforcing payment or performance hereof and with interest from the
date of Default on the unpaid principal balance hereof at the Default rate
specified in Section 2.11 of the Agreement, shall, at the election of NCB
(except as otherwise provided for automatic acceleration on the occurrence of
certain Defaults specified in the Agreement), and without relief from valuation
and appraisement laws, become immediately due and payable.
Borrower and all endorsers, guarantors, sureties, accommodation parties
hereof and all other parties liable or to become liable for all or any part of
this indebtedness, severally waive demand, presentment for payment, notice of
dishonor, protest and notice of protest and expressly agree that this Note and
any payment coming due under it may be extended or otherwise modified from time
to time without in any way affecting their liability hereunder.
Notice of acceptance of this Note by NCB is hereby waived.
BORROWER, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS NOTE OR
ANY OTHER LOAN DOCUMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS NOTE OR
ANY COURSE OF CONDUCT, DEALING, STATEMENTS, WHETHER ORAL OR WRITTEN, OR ACTIONS
OF BORROWER OR NCB. BORROWER SHALL NOT SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR
OTHERWISE, ANY ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER
ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS
SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY NCB
EXCEPT BY WRITTEN INSTRUMENT EXECUTED BY BORROWER AND NCB.
IN WITNESS WHEREOF, Borrower has caused this Note to be executed by its
duly authorized officer as of the day and year first hereinabove written.
THE FINISH LINE, INC., a Delaware corporation
By: _______________________________________
▇▇▇▇ ▇. ▇▇▇▇▇, Executive Vice President
and General Counsel
================================================================================
Page 2 of a Note containing Two Pages, dated September 20, 2000 from THE FINISH
LINE, INC. to NATIONAL CITY BANK OF INDIANA
SCHEDULE OF ADVANCES UNDER SWINGLINE
------------------------------------
AND PAYMENTS OF PRINCIPAL
-------------------------
BORROWER: THE FINISH LINE, INC.
NOTE DATED: SEPTEMBER 20, 2000
Principal Maturity
Amount Type of Interest Amount of Unpaid
Date of Advance of Advance Period Principal Repaid Balance Maturity
---- ---------- ---------- ------ ---------------- ------- --------
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
EXHIBIT C
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COMPLIANCE CERTIFICATE
To: The Lenders Parties to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain Credit
Agreement dated as of September 20, 2000 (as amended, modified, renewed or
extended from time to time, the "Agreement") among THE FINISH LINE, INC. (the
"Borrower"), the Lenders party thereto and National City Bank of Indiana, as
Agent for the Lenders. Unless otherwise defined herein, capitalized terms used
in this Compliance Certificate have the meanings ascribed thereto in the
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ___________________________ of Borrower;
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or event which constitutes a
Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below;
4. Schedule I attached hereto sets forth financial data and computations
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evidencing Borrower's compliance with Sections 6.12, 6.13, 6.14, 6.15, 6.16,
6.17, 6.18 and 6.19 of the Agreement, all of which data (in all material
respects) and such computations are true, complete and correct;
5. Schedule II attached hereto sets forth the determination of the
-----------
Applicable Facility Fee and the Applicable Margin to be effective on the fifth
(5th) Business Day following the delivery hereof;
6. Schedule III attached hereto sets forth the various reports and
------------
deliveries which are required under the Credit Agreement and the other Loan
Documents and the status of compliance; and
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which Borrower has taken, is taking, or proposes to take
with respect to each such condition or event:
_________________________________________
_________________________________________
_________________________________________
The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
---------- -----------
this Certificate in support hereof, are made and delivered this ___day of
______, ____.
THE FINISH LINE, INC.
By: ________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Executive Vice President-Finance
SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of _________,_____ with
Provisions of ___ and ___ of
the Agreement
SCHEDULE II TO COMPLIANCE CERTIFICATE
Determination of the Applicable Facility Fee
and the Applicable Margin
SCHEDULE III TO COMPLIANCE CERTIFICATE
Reports and Deliveries
EXHIBIT D
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SUBSIDIARY GUARANTY
THIS SUBSIDIARY GUARANTY (this "Guaranty") is made as of the ___day
of______________ , by the undersigned (collectively, the "Subsidiary
Guarantors") in favor of the Agent, for the ratable benefit of the Lenders,
under the Credit Agreement referred to below;
WITNESSETH:
WHEREAS, THE FINISH LINE, INC., a Delaware corporation (the "Principal"),
and NATIONAL CITY BANK OF INDIANA, a national banking association, as Agent (the
"Agent"), and certain other Lenders from time to time party thereto have entered
into a certain Credit Agreement dated as of September 20, 2000 (as the same may
be amended or modified from time to time, the "Credit Agreement"), providing,
subject to the terms and conditions thereof, for extensions of credit to be made
by the Lenders to the Principal;
WHEREAS, it is a requirement under the Credit Agreement that each of the
Subsidiary Guarantors execute and deliver this Guaranty whereby each of the
Subsidiary Guarantors shall guarantee the payment when due, subject to Section
10 hereof, of all principal, interest and other amounts that shall be at any
time payable by the Principal under the Credit Agreement, the Notes and the
other Loan Documents; and
WHEREAS, in consideration of the financial and other support that the
Principal has provided, and such financial and other support as the Principal
may in the future provide, to the Subsidiary Guarantors, and in order to induce
the Lenders to make Loans under the Credit Agreement, each of the Subsidiary
Guarantors is willing to guarantee the obligations of the Principal under the
Credit Agreement, the Notes, and the other Loan Documents;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions. Terms defined in the Credit Agreement and not
-----------
otherwise defined herein have, as used herein, the respective meanings provided
for therein.
SECTION 2.01 Representations and Warranties. Each of the Subsidiary
------------------------------
Guarantors represents and warrants (which representations and warranties shall
be deemed to have been renewed upon each Advance under the Credit Agreement)
that:
(a) it (i) is a corporation duly organized, validly existing and, if
applicable, in good standing under the laws of its jurisdiction of
incorporation; (ii) has all requisite corporate power, and has all material
governmental licenses, authorizations, consents and approvals necessary to own
its assets and carry on its business as now being or as proposed to be
conducted; and (iii) is qualified to do business in all jurisdictions where
failure so to qualify could reasonably be expected to have a Material Adverse
Effect.
(b) it has all necessary corporate power and authority to execute,
deliver and perform its obligations under this Guaranty; the execution, delivery
and performance of this Guaranty have been duly authorized by all necessary
corporate action; and this Guaranty has been duly and validly executed and
delivered by it and constitutes its legal, valid and binding obligation,
enforceable in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, or moratorium or other
similar laws relating to the enforcement of creditors' rights generally and by
general equitable principles.
(c) neither the execution and delivery by it of this Guaranty nor
compliance with the terms and provisions hereof will conflict with, or result in
a breach of, or require any consent under, (i) its articles or certificate of
incorporation or by-laws or any applicable law or regulation; (ii) any order,
writ, injunction or decree of Governmental Authority, (iii) any other agreement
or instrument to which it is a party or by which it is bound or to which it is
subject, the breach or default of which, singly or in the aggregate, could
reasonably be expected to have a Material Adverse Effect; or (iv) result in the
creation or imposition of any Lien upon any of its revenues or assets pursuant
to the terms of any such agreement or instrument.
SECTION 2.02 Covenants. Each of the Subsidiary Guarantors covenants that,
---------
so long as any Lender has any Commitment outstanding under the Credit Agreement
or any Obligation payable under the Credit Agreement or any Note shall remain
unpaid, that it will not take any action that would result in a violation by the
Principal of the covenants and agreements set forth in the Credit Agreement.
SECTION 3. The Guaranty. Subject to Section 10 hereof, each of the
------------
Subsidiary Guarantors hereby unconditionally guarantees the full and punctual
payment (whether at stated maturity, upon acceleration or otherwise but giving
effect to any applicable notice or grace period) of the principal of and
interest on each Note issued by the Principal pursuant to the Credit Agreement,
and the full and punctual payment of all other amounts payable by the Principal
under the Credit Agreement and the other Loan Documents including, without
limitation, the Obligations (all of the foregoing, subject to the provisions of
Section 10 hereof, being referred to collectively as the "Guaranteed
Obligations"). Upon failure by the Principal to pay punctually any such amount,
each of the Subsidiary Guarantors agrees that it shall forthwith on demand pay
the amount not so paid at the place and in the manner specified in the Credit
Agreement, any Note or the relevant Loan Document, as the case may be, it being
agreed and acknowledged by each Subsidiary Guarantor that this Guaranty
constitutes a guaranty of payment (and not collection), and that it shall not be
necessary for the Agent or any Lender to exercise any
-2-
remedies against the Principal or any other Person as a condition to a demand
for payment under this Guaranty.
SECTION 4. Guaranty Unconditional. Subject to Section 10 hereof, the
----------------------
obligations of each of the Subsidiary Guarantors hereunder shall be
unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Principal under the Credit Agreement, any
Note, or any other Loan Document, by operation of law or otherwise or any
obligation of any other guarantor of any of the Obligations;
(b) any modification or amendment of or supplement to the Credit
Agreement, any Note, or any other Loan Document;
(c) any release, nonperfection or invalidity of any direct or indirect
security for any obligation of the Principal under the Credit Agreement,
any Note, any security agreement, any Loan Document, or any obligations of
any other guarantor of any of the Obligations;
(d) any change in the corporate existence, structure or ownership of the
Principal or any other guarantor of any of the Obligations, or any
insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Principal, or any other guarantor of the Obligations, or its
assets or any resulting release or discharge of any obligation of the
Principal, or any other guarantor of any of the Obligations;
(e) the existence of any claim, setoff or other rights which any of the
Subsidiary Guarantors may have at any time against the Principal, any other
guarantor of any of the Obligations, the Agent, any Lender or any other
Person, whether in connection herewith or any unrelated transactions;
(f) any invalidity or unenforceability relating to or against the
Principal, or any other guarantor of any of the Obligations, for any reason
related to the Credit Agreement, any other Loan Document, or any provision
of applicable law or regulation purporting to prohibit the payment by the
Principal, or any other guarantor of the Obligations, of the principal of
or interest on any Note or any other amount payable by the Principal under
the Credit Agreement, the Notes, or any other Loan Document; or
(g) any other act or omission to act or delay of any kind by the
Principal, any other guarantor of the Obligations, the Agent, any Lender or
any other Person or any other circumstance whatsoever which might, but for
the provisions of this paragraph, constitute a legal or equitable discharge
of any Subsidiary Guarantor's obligations hereunder.
-3-
SECTION 5. Discharge Only Upon Payment In Full; Reinstatement In Certain
-------------------------------------------------------------
Circumstances. Each of the Subsidiary Guarantor's obligations hereunder shall
-------------
remain in full force and effect until all Guaranteed Obligations shall have been
paid in full and the Commitments under the Credit Agreement shall have
terminated or expired. If at any time any payment of the principal of or
interest on any Note or any other amount payable by the Principal or any other
party under the Credit Agreement or any other Loan Document is rescinded or must
be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Principal or otherwise, each of the Subsidiary Guarantor's
obligations hereunder with respect to such payment shall be reinstated as though
such payment had been due but not made at such time.
SECTION 6. Waiver of Notice. Each of the Subsidiary Guarantors irrevocably
----------------
waives acceptance hereof, presentment, demand, protest and, to the fullest
extent permitted by law, any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Principal, any other guarantor of the Obligations, or any other Person.
SECTION 7. Subrogation. Each of the Subsidiary Guarantors hereby agrees not
-----------
to assert any right, claim or cause of action, including, without limitation, a
claim for subrogation, reimbursement, indemnification or otherwise, against the
Principal arising out of or by reason of this Guaranty or the obligations
hereunder, including, without limitation, the payment or securing or purchasing
of any of the Obligations by any of the Subsidiary Guarantors unless and until
the Guaranteed Obligations are paid in full and any commitment to lend or issue
Letters of Credit under the Credit Agreement and other Loan Documents is
terminated.
SECTION 8. Stay of Acceleration. If acceleration of the time for payment of
--------------------
any amount payable by the Principal under the Credit Agreement, any Note or any
other Loan Document is stayed upon the insolvency, bankruptcy or reorganization
of the Principal, all such amounts otherwise subject to acceleration under the
terms of the Credit Agreement, any Note or any other Loan Document shall
nonetheless be payable by each of the Subsidiary Guarantors hereunder forthwith
on demand by the Agent made at the request of the Required Lenders.
SECTION 9. Other Guarantors: The obligations under this Guaranty shall be
----------------
joint and several. In addition, each Subsidiary Guarantor shall be jointly and
severally liable with any other guarantor of the Guaranteed Obligations. If the
Required Lenders or the Agent elect to enforce their rights against less than
all guarantors of the Guaranteed Obligations, that election shall not release
any Subsidiary Guarantor from its obligations under this Guaranty.
SECTION 10. Limitation on Obligations. (a) It is the intention of each of
-------------------------
the Subsidiary Guarantors and the Lenders that the obligations of each
Subsidiary Guarantor hereunder shall be in, but not in excess of, as of any
date, the maximum amount (such amount being the Subsidiary Guarantor's "Maximum
Liability") not subject to avoidance under Title 11 of the United States Code,
as same may be amended from time to time, or any applicable state law
(collectively, the "Bankruptcy Code"). To that end, but as to the Maximum
Liability of the Subsidiary Guarantors,
-4-
only to the extent such obligations would otherwise be subject to avoidance
under the Bankruptcy Code if the Subsidiary Guarantor is not deemed to have
received valuable consideration, fair value or reasonably equivalent value for
its obligations hereunder, any Subsidiary Guarantor's obligations hereunder
shall be reduced to that amount which, after giving effect thereto, would not
render the Subsidiary Guarantor insolvent, or leave the Subsidiary Guarantor
with an unreasonably small capital to conduct its business, or cause the
Subsidiary Guarantor to have incurred debts (or intended to have incurred debts)
beyond its ability to pay such debts as they mature, at the time such
obligations are deemed to have been incurred. As used herein, the terms
"insolvent" and "unreasonably small capital" shall likewise be determined in
accordance with the Bankruptcy Code. This Section 10(a) with respect to the
Maximum Liability of each Subsidiary Guarantor is intended solely to preserve
the rights of the Agent hereunder to the maximum extent not subject to avoidance
under the Bankruptcy Code, and neither any Subsidiary Guarantor nor any other
person or entity shall have any right or claim under this Section 10(a) with
respect to the Maximum Liability, except to the extent necessary so that the
obligations of such Subsidiary Guarantor hereunder shall not be rendered
voidable under the Bankruptcy Code.
(b) Each of the Subsidiary Guarantors agrees that the Guaranteed
Obligations may at any time and from time to time exceed the Maximum Liability
of each Subsidiary Guarantor, and may exceed the aggregate Maximum Liability of
all other Subsidiary Guarantors, without impairing this Guaranty or affecting
the rights and remedies of the Agent hereunder. Nothing in this Section 10(b)
shall be construed to increase any Subsidiary Guarantor's obligations hereunder
beyond its Maximum Liability.
(c) In the event any Subsidiary Guarantor (a "Paying Subsidiary
Guarantor") shall make any payment or payments under this Guaranty, each other
Subsidiary Guarantor (each a "Non-Paying Subsidiary Guarantor") shall contribute
to such Paying Subsidiary Guarantor an amount equal to such Non-Paying
Subsidiary Guarantor's "Pro Rata Share" of such payment or payments made, by
such Paying Subsidiary Guarantor. For the purposes hereof, each Non-Paying
Subsidiary Guarantor's "Pro Rata Share" with respect to any such payment by a
Paying Subsidiary Guarantor shall be determined as of the date on which such
payment was made by reference to the ratio of (i) such Non-Paying Subsidiary
Guarantor's Maximum Liability as of such date (without giving effect to any
right to receive, or obligation to make, any contribution hereunder) to (ii) the
aggregate Maximum Liability of all Subsidiary Guarantors hereunder (including
such Paying Subsidiary Guarantor) as of such date (without giving effect to any
right to receive, or obligation to make, any contribution hereunder). Nothing in
this Section 10 (c) shall affect any Subsidiary Guarantor's several liability
for the entire amount of the Guaranteed Obligations (up to such Subsidiary
Guarantor's Maximum Liability). Each of the Subsidiary Guarantors covenants and
agrees that its right to receive any contribution under this Guaranty from a
Non-Paying Subsidiary Guarantor shall be subordinate and junior in right of
payment to all the Guaranteed Obligations. The provisions of this Section 10(c)
are for the benefit of both the Agent and the Subsidiary Guarantors and may be
enforced by any one, or more, or all of them in accordance with the terms
hereof.
-5-
SECTION 11. Subordination of Certain Indebtedness.
-------------------------------------
(a) As used herein, the term "Guarantor Claims" shall mean all debts and
liabilities of the Principal to any Subsidiary Guarantor, whether such debts and
liabilities now exist or are hereafter incurred or arise, or whether the
obligations of the Principal thereon be direct, contingent, primary, secondary,
several, joint and several, or otherwise, and irrespective of the Person or
Persons in whose favor such debts or liabilities may, at their inception, have
been, or may hereafter be created, or the manner in which they have been or may
hereafter be acquired by any Subsidiary Guarantor. The Guarantor Claims shall
include without limitation all rights and claims of each Subsidiary Guarantor
against the Principal (arising as a result of subrogation or otherwise ) as a
result of any Subsidiary Guarantor's payment of all or a portion of the
Guaranteed Debt. Until the Guaranteed Obligations shall be paid and satisfied in
full and the Subsidiary Guarantors shall have performed all of their obligations
hereunder, if an Unmatured Default or Default exists or would be occasioned
thereby, then the Subsidiary Guarantors shall not receive or collect, directly
or indirectly, from the Principal or any other party any amount upon the
Guarantor Claims.
(b) In the event of receivership, bankruptcy, reorganization, arrangement,
debtor's relief, or other insolvency proceedings involving the Principal as
debtor, the Agent shall have the right to prove its claim in any such proceeding
so as to establish its rights hereunder and receive directly from the receiver,
trustee, or other court custodian dividends and payments which would otherwise
be payable upon Guarantor Claims. Each Subsidiary Guarantor hereby assigns such
dividends and payments to the Agent. Should the Agent receive, for application
upon the Guaranteed Obligations, any such dividend or payment which is otherwise
payable to any Subsidiary Guarantor, and which, as between the Principal and
such Subsidiary Guarantor, shall constitute a credit upon the Guarantor Claims,
then upon payment to the Agent in full of the Guaranteed Obligations, such
Subsidiary Guarantor shall become subrogated to the rights of the Agent to the
extent that such payments to the Agent on the Guarantor Claims have contributed
toward the liquidation of the Guaranteed Obligations, and such subrogation shall
be with respect to that proportion of the Guaranteed Obligations which would
have been unpaid if the Agent had not received dividends or payments upon the
Guarantor Claims.
(c) In the event that, notwithstanding paragraphs (a) and (b) above, any
Subsidiary Guarantor should receive any funds, payment, claim, or distribution
which is prohibited by such paragraphs, such Subsidiary Guarantor agrees to hold
in trust for the Agent, in kind, all funds, payments, claims, or distributions
so received, and agrees that it shall have absolutely no dominion over such
funds, payments, claims, or distributions so received except to pay them
promptly to the Agent, for the benefit of the Lenders, and such Subsidiary
Guarantor covenants promptly to pay the same to the Agent, for the benefit of
the Lenders.
(d) Each Subsidiary Guarantor agrees that any liens, security interest,
judgment liens, charges, or other encumbrances upon the Principal's assets
securing payment of the Guarantor
-6-
Claims shall be and remain inferior and subordinate to any liens, security
interests, judgment liens, charges, or other encumbrances upon the Principal's
assets securing payment of the Guaranteed Obligations, regardless of whether
such encumbrances in favor of such Guarantor or the Agent presently exists or
are hereafter created or attach. Without the prior written consent of the Agent,
no Subsidiary Guarantor shall (a) exercise or enforce any creditor's right it
may have against the Principal, or (b) foreclose, repossess, sequester, or
otherwise take steps or institute any action or proceedings (judicial or
otherwise, including, without limitation, the commencement of, or joinder in,
any liquidation, bankruptcy, rearrangement, debtor's relief, or insolvency
proceeding) to enforce any liens, mortgages, deeds of trust, security interest,
collateral rights, judgments, or other encumbrances on assets of the Principal
held by any Subsidiary Guarantor.
(e) All promissory notes, accounts receivable ledgers, or other evidences
of the Guarantor Claims accepted by or held by each Subsidiary Guarantor shall
contain a specific written notice thereon that the indebtedness evidenced
thereby is subordinated under the terms of this Guaranty.
(f) As to its Guarantor claims, each Subsidiary Guarantor represents to
the Agent and the Lenders that (i) it is the sole holder of the Guarantor Claims
with full power to make the subordinations set forth in this Guaranty, and (ii)
it has not made or permitted any assignment or transfer, as collateral or
otherwise, of its Guarantor Claims, any instrument evidencing the Guarantor
Claims, or any collateral therefor, and it shall not do so as long as this
Guaranty remains in effect.
SECTION 12. Notices. All notices, requests and other communications to any
-------
party hereunder shall be given or made by telecopier or other writing and
telecopied, mailed or delivered to the intended recipient at its address or
telecopier number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for such purpose by
notice to the Agent in accordance with the provisions of Section 13 of the
Credit Agreement. Except as otherwise provided in this Guaranty, all such
communications shall be deemed to have been duly given when transmitted by
telecopier and confirmation of receipt is received, or personally delivered or,
in the case of a mailed notice sent by certified mail return-receipt requested,
on the date set forth on the receipt (provided, that any refusal to accept any
such notice shall be deemed to be notice thereof as of the time of any such
refusal), in each case given or addressed as aforesaid.
SECTION 13. No Waivers. No failure or delay by the Agent or any Lenders in
----------
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies provided in this Guaranty, the Credit Agreement, the
Notes, and the other Loan Documents shall be cumulative and not exclusive of any
rights or remedies provided by law.
-7-
SECTION 14. Successors and Assigns. This Guaranty is for the benefit of the
----------------------
Agent and the Lenders and their respective successors and permitted assigns and
in the event of an assignment of any amounts payable under the Credit Agreement,
the Notes, or the other Loan Documents, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred with such
indebtedness. This Guaranty shall be binding upon each of the Subsidiary
Guarantors and their respective successors and permitted assigns.
SECTION 15. Changes in Writing. Neither this Guaranty nor any provision
------------------
hereof may be changed, waived, discharged or terminated orally, but only in
writing signed by each of the Subsidiary Guarantors and the Agent with the
consent of the Required Lenders.
SECTION 16. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
---------------------------------------------------------
TRIAL. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
-----
LAW OF THE STATE OF INDIANA. EACH OF THE SUBSIDIARY GUARANTORS HEREBY SUBMITS TO
THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF INDIANA AND OF ANY INDIANA STATE COURT SITTING IN
INDIANAPOLIS, INDIANA FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS GUARANTY (INCLUDING, WITHOUT LIMITATION, ANY OF THE OTHER LOAN
DOCUMENTS) OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE SUBSIDIARY
GUARANTORS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE SUBSIDIARY GUARANTORS, AND THE AGENT AND THE LENDERS ACCEPTING THIS
GUARANTY, HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 17. Taxes. etc. All payments required to be made by any of the
----------
Subsidiary Guarantors hereunder shall be made without setoff or counterclaim and
free and clear of and without deduction for any and all Taxes, provided,
however, that if any of the Subsidiary Guarantors is required by law to make
such deduction, such Subsidiary Guarantor shall forthwith pay to the Agent or
any Lender, as applicable, such additional amount as results in the net amount
received by the Agent or any Lender, as applicable, equaling the full amount
which would have been received by the Agent or any Lender, as applicable, had no
such deduction been made.
-8-
IN WITNESS WHEREOF, each of the Subsidiary Guarantors has caused this
Guaranty to be duly executed, under seal, by its authorized officer as of the
day and year first above written.
__________________________
By:________________________________
Its:_______________________________
Address:
____________________
____________________
____________________
Attention:
Facsimile:____________
-9-
EXHIBIT E
---------
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between __________
(the "Assignor") and ___________ (the "Assignee") is dated as of _________, ___.
The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement
---------------------
(which, as it may be amended, modified, renewed or extended from time to time is
herein called the "Credit Agreement") described in Item 1 of Schedule 1 attached
hereto ("Schedule 1"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings attributed to them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
-------------------------
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the facilities listed in Item 3 of
Schedule 1 and the other Loan Documents. The aggregate Commitment (or Loans, if
the applicable Commitment has been terminated) purchased by the Assignee
hereunder is set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
-----------------------
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two Business Days (or such shorter period agreed to by the Agent) after a
Notice of Assignment substantially in the form of Exhibit "I" attached hereto
has been delivered to the Agent. Such Notice of Assignment must include any
consents required to be delivered to the Agent by Section 12.3.1 of the Credit
Agreement. In no event will the Effective Date occur if the payments required to
be made by the Assignee to the Assignor on the Effective Date under Sections 4
and 5 hereof are not made on the proposed Effective Date. The Assignor will
notify the Assignee of the proposed Effective Date no later than the Business
Day prior to the proposed Effective Date. As of the Effective Date, (a) the
Assignee shall have the rights and obligations of a Lender under the Loan
Documents with respect to the rights and obligations assigned to the Assignee
hereunder, and (b) the Assignor shall relinquish its rights and be released from
its corresponding obligations under the Loan Documents with respect to the
rights and obligations assigned to the Assignee hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
--------------------
shall be entitled to receive from the Agent all payments of principal, interest
and fees with respect to the interest assigned hereby. The Assignee shall
advance funds directly to the Agent with respect to all Loans and reimbursement
payments made on or after the Effective Date with respect to the interest
assigned hereby. [In consideration for the sale and assignment of Loans
hereunder, (a) the Assignee
shall pay the Assignor, on the Effective Date, an amount equal to the principal
amount of the portion of all ABR Loans assigned to the Assignee hereunder, and
(b) with respect to each LIBOR Loan made by the Assignor and assigned to the
Assignee hereunder which is outstanding on the Effective Date, (i) on the last
day of the LIBOR Interest Period therefor, or (ii) on such earlier date agreed
to by the Assignor and the Assignee, or (iii) on the date on which any such
LIBOR Loan either becomes due (by acceleration or otherwise) or is prepaid (the
date as described in the foregoing clauses (i), (ii) or (iii) being hereinafter
referred to as the "Payment Date"), the Assignee shall pay the Assignor an
amount equal to the principal amount of the portion of such LIBOR Loan assigned
to the Assignee which is outstanding on the Payment Date. If the Assignor and
the Assignee agree that the Payment Date for such LIBOR Loan shall be the
Effective Date, they shall agree to the interest rate applicable to the portion
of such Loan assigned hereunder for the period from the Effective Date to the
end of the existing LIBOR Interest Period applicable to such LIBOR Loan (the
"Agreed Interest Rate") and any interest received by the Assignee in excess of
the Agreed Interest Rate shall be remitted to the Assignor. In the event
interest for the period from the Effective Date to but not including the Payment
Date is not paid by Borrower with respect to any LIBOR Loan sold by the Assignor
to the Assignee hereunder, the Assignee shall pay to the Assignor interest for
such period on the portion of such LIBOR Loan sold by the Assignor to the
Assignee hereunder at the applicable rate provided by the Credit Agreement. In
the event a prepayment of any LIBOR Loan which is existing on the Payment Date
and assigned by the Assignor to the Assignee hereunder occurs after the Payment
Date but before the end of the LIBOR Interest Period applicable to such LIBOR
Loan, the Assignee shall remit to the Assignor the excess of the prepayment
penalty paid with respect to the portion of such LIBOR Loan assigned to the
Assignee hereunder over the amount which would have been paid if such prepayment
penalty was calculated based on the Agreed Interest Rate. The Assignee will also
promptly remit to the Assignor (y) any principal payments received from the
Agent with respect to LIBOR Loans prior to the Payment Date, and (z) any amounts
of interest on Loans and fees received from the Agent which relate to the
portion of the Loans assigned to the Assignee hereunder for periods prior to the
Effective Date, in the case of ABR Loans or fees, or the Payment Date, in the
case of LIBOR Loans, and not previously paid by the Assignee to the Assignor.]*
In the event that either party hereto receives any payment to which the other
party hereto is entitled under this Assignment Agreement, then the party
receiving such amount shall promptly remit it to the other party hereto.
*Each Assignor may insert its standard payment provisions in lieu of the payment
terms included in this Exhibit.
5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the Assignor
----------------------------
a fee on each day on which a payment of interest or facility fees is made under
the Credit Agreement with respect to the amounts assigned to the Assignee
hereunder (other than a payment of interest or facility fees for the period
prior to the Effective Date or, in the case of LIBOR Loans, the Payment Date,
which the Assignee is obligated to deliver to the Assignor pursuant to Section 4
hereof). The amount of such fee shall be the difference between (a) the interest
or fee, as applicable, paid with respect to the amounts assigned to the Assignee
hereunder, and (b) the interest or fee, as applicable, which would have been
paid with respect to the amounts assigned to the Assignee hereunder if each
-2-
interest rate was _ of 1% less than the interest rate paid by Borrower or if the
facility fee was _ of 1% less than the facility fee paid by Borrower, as
applicable. In addition, the Assignee agrees to pay _% of the recordation fee
required to be paid to the Agent in connection with this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
--------------------------------------------------------------
LIABILITY. The Assignor represents and warrants that it is the legal and
---------
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It is
understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor nor
any of its officers, directors, employees, agents or attorneys shall be
responsible for (a) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of Borrower or any guarantor, (b) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (c) the financial condition or creditworthiness of Borrower or
any guarantor, (d) the performance of or compliance with any of the terms or
provisions of any of the Loan Documents, (e) inspecting any of the Property,
books or records of Borrower, (f) the validity, enforceability, perfection,
priority, condition, value or sufficiency of any collateral securing or
purporting to secure the Loans, or (g) any mistake, error of judgment, or action
taken or omitted to be taken in connection with the Loans or the Loan Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (a) confirms that it
-------------------------------
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement, (b) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any other
Lender and based on such documents and information at it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Loan Documents, (c) appoints and authorizes the Agent to take
such action as contractual representative on its behalf and to exercise such
powers under the Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, (d)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender, (e) agrees that its payment instructions and notice
instructions are as set forth in the attachment to Schedule 1, (f) confirms that
none of the funds, monies, assets or other consideration being used to make the
purchase and assumption hereunder are "plan assets" as defined under ERISA and
that its rights, benefits and interests in and under the Loan Documents will not
be "plan assets" under ERISA,(g) confirms that it is an Eligible Assignee, [and
(h) attaches the forms prescribed by the Internal Revenue Service of the United
States certifying that the Assignee is entitled to receive payments under the
Loan Documents without deduction or withholding of any United States federal
income taxes].**
**to be inserted if the Assignee is not incorporated under the laws of the
United States, or a state thereof.
-3-
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
---------
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any manner from the Assignee's non-performance
of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall
----------------------
have the right pursuant to Section 12.3.1 of the Credit Agreement to assign the
rights which are assigned to the Assignee hereunder to any entity or person,
provided that (a) any such subsequent assignment does not violate any of the
terms and conditions of the Loan Documents or any law, rule, regulation, order,
writ, judgment, injunction or decree and that any consent required under the
terms of the Loan Documents has been obtained, and (b) unless the prior written
consent of the Assignor is obtained, the Assignee is not thereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
----------------------------------
aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage interest specified in Item 3 of Schedule 1
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment.
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice
----------------
of Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
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internal law, and not the law of conflicts, of the State of Indiana.
13. NOTICES. Notices shall be given under this Assignment Agreement in
-------
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall be
the address set forth in the attachment to Schedule 1.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
"ASSIGNOR"
___________________________________
By:________________________________
Title:_____________________________
"ASSIGNEE"
___________________________________
By:________________________________
Title:_____________________________
-5-
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
2. Date of Assignment Agreement: _____________, ________
3. Amounts (As of date of Item 2 above):
Revolving Credit Loans
----------------------
a. Total of Commitments
(Loans)* under
Credit Agreement $_____________________
b. Assignee's Percentage
of each Facility purchased
under the Assignment
Agreement** ____%
c. Amount of Assigned Share in
each Facility purchased under
the Assignment
Agreement $_____________________
4. Assignee's Aggregate (Loan
Amount)** Commitment Amount
Purchased Hereunder: $_____________________
5. Proposed Effective Date: ______________________
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By:__________________ By:__________________
Title:_________________ Title:_________________
* If a Commitment has been terminated, insert outstanding Loans in place of
Commitment
** Percentage taken to 10 decimal places
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee
EXHIBIT I
---------
to Assignment Agreement
NOTICE
OF ASSIGNMENT
-------------
_____________, 19_
To: [NAME OF BORROWER]*
__________________
__________________
[NAME OF AGENT]
__________________
__________________
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Credit Agreement (the "Credit Agreement") described
in Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings attributed to
them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and delivered to
****[Borrower and]**** the Agent pursuant to Section 12.3.2 of the Credit
Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of ___________, _____ (the "Assignment"), pursuant to which,
among other things, the Assignor has sold, assigned, delegated and transferred
to the Assignee, and the Assignee has purchased, accepted and assumed from the
Assignor the percentage interest specified in Item 3 of Schedule 1 of all
outstandings, rights and obligations under the Credit Agreement relating to the
facilities listed in Item 3 of Schedule 1. The Effective Date of the Assignment
shall be the later of the date specified in Item 5 of Schedule 1 or two Business
Days (or such shorter period as agreed to by the Agent) after this Notice of
Assignment and any consents and fees required by Sections 12.3.1 and 12.3.2 of
the Credit Agreement have been delivered to the Agent, provided that the
Effective Date shall not occur if any condition precedent agreed to by the
Assignor and the Assignee has not been satisfied.
*To be included only if consent must be obtained from Borrower pursuant to
Section 12.3.1 of the Credit Agreement.
4. The Assignor and the Assignee hereby give to Borrower and the Agent
notice of the assignment and delegation referred to herein. The Assignor will
confer with the Agent before the date specified in Item 5 of Schedule 1 to
determine if the Assignment Agreement will become effective on such date
pursuant to Section 3 hereof, and will confer with the Agent to determine the
Effective Date pursuant to Section 3 hereof if it occurs thereafter. The
Assignor shall notify the Agent if the Assignment Agreement does not become
effective on any proposed Effective Date as a result of the failure to satisfy
the conditions precedent agreed to by the Assignor and the Assignee. At the
request of the Agent, the Assignor will give the Agent written confirmation of
the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Agent on or before the
Effective Date the processing fee of $3,500 required by Section 12.3.2 of the
Credit Agreement.
6. If Notes are outstanding on the Effective Date, the Assignor and the
Assignee request and direct that the Agent prepare and cause Borrower to execute
and deliver new Notes or, as appropriate, replacement notes, to the Assignor and
the Assignee. The Assignor and, if applicable, the Assignee each agree to
deliver to the Agent the original Note received by it from Borrower upon its
receipt of a new Note in the appropriate amount.
7. The Assignee advises the Agent that notice and payment instructions
are set forth in the attachment to Schedule 1.
8. The Assignee hereby represents and warrants that none of the funds,
monies, assets or other consideration being used to make the purchase pursuant
to the Assignment are "plan assets" as defined under ERISA and that its rights,
benefits, and interests in and under the Loan Documents will not be "plan
assets" under ERISA.
9. The Assignee authorizes the Agent to act as its contractual
representative under the Loan Documents in accordance with the terms thereof.
The Assignee acknowledges that the Agent has no duty to supply information with
respect to Borrower or the Loan Documents to the Assignee until the Assignee
becomes a party to the Credit Agreement.*
*May be eliminated if Assignee is a party to the Credit Agreement prior to the
Effective Date.
NAME OF ASSIGNOR NAME OF ASSIGNEE
By:___________________ By:___________________
Title:________________ Title:________________
ACKNOWLEDGED [AND CONSENTED TO] ACKNOWLEDGED [AND CONSENTED TO]
BY [NAME OF AGENT] BY [NAME OF BORROWER]
By:________________________ By:________________________
Title:_____________________ Title:_____________________
[Attach photocopy of Schedule 1 to Assignment]
EXHIBIT F
---------
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
----------------------------------------------
To National City Bank of Indiana
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Credit Agreement dated September 20, 2000 (as the same may be amended or
modified, the "Credit Agreement"), among THE FINISH LINE, INC. (the
"Borrower"), the Lenders named therein and the Agent. Capitalized terms
used herein and not otherwise defined herein shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the following
standing money transfer instructions with respect to the proceeds of Advances or
other extensions of credit from time to time until receipt by the Agent of a
specific written revocation of such instructions by the Borrower, provided,
however, that the Agent may otherwise transfer funds as hereafter directed in
writing by the Borrower in accordance with Sections 13.1 or 2.13 of the Credit
Agreement.
Facility Identification Number(s):
Customer/Account Name
Transfer Funds To ______________________________________________________________
____________________________________________________________
For Account No. ________________________________________________________________
Reference/Attention To _________________________________________________________
Authorized Officer (Customer Representative) Date _________________________
________________________________ ______________________________
(Please Print) Signature
Bank Officer Name Date _________________________
________________________________ ______________________________
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
EXHIBIT G
---------
_____________
(Date)
INDEPENDENT AUDITORS' REPORT
We have audited, in accordance with generally accepted auditing standards, the
consolidated balance sheet of The Finish Line, Inc. (the "Company") and its
subsidiaries as of _____________, and the related consolidated statements of
income, stockholders' equity and cash flows for the year then ended, and have
issued our report thereon dated ____________.
In connection with our audit, nothing came to our attention that caused us to
believe that the Company failed to comply with any of the terms, covenants,
provisions or condition of the Credit Agreement dated September 20, 2000, with
National City Bank of Indiana, as Agent, particularly Sections 5, 6 and 7,
insofar as they relate to accounting matters. However, our audit was not
directed primarily toward obtaining knowledge of such noncompliance.
This report is intended solely for the information and use of the boards of
directors and management of the Company and National City Bank of Indiana, as
Agent, and should not be used for any other purpose.
Very truly yours,