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CREDIT AGREEMENT
Dated as of March 13, 1996
among
FAIRCHILD HOLDING CORP.
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS LENDERS
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS ISSUING BANKS
and
CITICORP USA, INC.
as Administrative Agent
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CREDIT AGREEMENT
This Credit Agreement dated as of March 13, 1996 (as
amended, supplemented or modified from time to time, the
"Agreement") is entered into among Fairchild Holding Corp.,
a Delaware corporation (the "Borrower"), the institutions
from time to time a party hereto as Lenders, whether by
execution of this Agreement or an Assignment and Acceptance,
the institutions from time to time a party hereto as Issuing
Banks, whether by execution of this Agreement or an
Assignment and Acceptance, and Citicorp USA, Inc., a
Delaware corporation ("Citicorp"), in its capacity as agent
for the Lenders and the Issuing Banks hereunder (in such
capacity, the "Administrative Agent").
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms. The following terms used
in this Agreement shall have the following meanings,
applicable both to the singular and the plural forms of the
terms defined:
"Accommodation Obligation" means any Contractual
Obligation, contingent or otherwise, of one Person with
respect to any Indebtedness, obligation or liability of
another, if the primary purpose or intent thereof by the
Person incurring the Accommodation Obligation is to provide
assurance to the obligee of such Indebtedness, obligation or
liability of another that such Indebtedness, obligation or
liability will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders
thereof will be protected (in whole or in part) against loss
in respect thereof including, without limitation, direct and
indirect guarantees, endorsements (except for collection or
deposit in the ordinary course of business), notes co-made
or discounted, recourse agreements, take-or-pay agreements,
keep-well agreements, put options, agreements to purchase or
repurchase such Indebtedness, obligation or liability or any
security therefor or to provide funds for the payment or
discharge thereof, agreements to maintain solvency, assets,
level of income, or other financial condition, and
agreements to make payment other than for value received.
The amount of any Accommodation Obligation shall be equal to
the amount of the Indebtedness, obligation or liability so
guaranteed or otherwise supported; provided, that (i) if the
liability of the Person extending such guaranty or support
is limited with respect thereto to an amount less than the
Indebtedness, obligation or liability guaranteed or
supported, or is limited to recourse against a particular
asset or assets of such Person, the amount of the
corresponding Accommodation Obligation shall be limited (in
the case of a guaranty or other support limited by amount)
to such lesser amount or (in the case of a guaranty or other
support limited by recourse to a particular asset or assets)
to the higher of the Fair Market Value of such asset or
assets at the date for determination of the amount of the
Accommodation Obligation or the value at which such asset or
assets would, in conformity with GAAP, be reflected on or
valued for the purposes of preparing a consolidated balance
sheet of such Person as at such determination date; and
(ii) if any obligation or liability is guaranteed or
otherwise supported jointly and severally by a Person and
others, then the amount of the obligation or liability of
such Person with respect to such guaranty or other support
to be included in the amount of such Person's Accommodation
Obligation shall be the whole principal amount so guaranteed
or otherwise supported.
"Administrative Agent" means Citicorp and each
successor Administrative Agent appointed pursuant to the
terms of Article XIII of this Agreement.
"Affiliate", as applied to any Person, means any other
Person that directly or indirectly controls, is controlled
by, or is under common control with, that Person. For
purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled
by" and "under common control with"), as applied to any
Person, means the possession, directly or indirectly, of the
power to vote ten percent (10.0%) or more of the Securities
having voting power for the election of directors of such
Person or otherwise to direct or cause the direction of the
management and policies of that Person, whether through the
ownership of voting Securities or by contract or otherwise.
"Agreement" is defined in the preamble hereto.
"Applicable Lending Office" means, with respect to a
particular Lender, its Eurodollar Lending Office in respect
of provisions relating to Eurodollar Rate Loans and its
Domestic Lending Office in respect of provisions relating to
Base Rate Loans.
"Assignment and Acceptance" means an Assignment and
Acceptance in substantially the form of Exhibit A attached
hereto and made a part hereof (with blanks appropriately
completed) delivered to the Administrative Agent in
connection with an assignment of a Lender's interest under
this Agreement in accordance with the provisions of
Section 15.01.
"Bankruptcy Code" means Title 11 of the United States
Code (11 U.S.C. 101 et seq.), as amended from time to time,
and any successor statute.
"Base Eurodollar Rate" means, with respect to any Euro-
dollar Interest Period applicable to a Borrowing of
Eurodollar Rate Loans, an interest rate per annum determined
by the Administrative Agent to be the average (rounded
upward to the nearest whole multiple of one sixteenth of one
percent (0.0625%) per annum if such average is not such a
multiple) of the rates per annum specified by notice to the
Administrative Agent by Citibank as the rate per annum at
which deposits in Dollars are offered by the principal
office of Citibank in London, England to major banks in the
London interbank market at approximately 11:00 a.m. (London
time) on the Eurodollar Interest Rate Determination Date for
such Eurodollar Interest Period for a period equal to such
Eurodollar Interest Period and in an amount substantially
equal to the amount of the Eurodollar Rate Loan to be
outstanding to Citicorp for such Eurodollar Interest Period.
"Base Rate" means, for any period, a fluctuating
interest rate per annum as shall be in effect from time to
time, which rate per annum shall at all times be equal to
the highest of:
(i) the rate of interest announced publicly by Citibank
in New York, New York from time to time, as Citibank's base
rate; and
(ii) the sum of (A) one-half of one percent (0.50%)
per annum plus (B) the Federal Funds Rate in effect from
time to time during such period.
"Base Rate Loans" means all Loans which bear interest
at a rate determined by reference to the Base Rate as
provided in Section 5.01(a).
"Base Rate Margin" means a rate equal to one-half of
one percent (0.50%) per annum.
"Benefit Plan" means a defined benefit plan as defined
in Section 3(35) of ERISA (other than a Multiemployer Plan
or Foreign Employee Benefit Plan) in respect of which the
Borrower or any ERISA Affiliate is, or within the
immediately preceding five (5) years was, an "employer" as
defined in Section 3(5) of ERISA.
"Borrower" is defined in the preamble of this
Agreement.
"Borrowing" means a borrowing consisting of Loans of
the same type made, continued or converted on the same day
and, in the case of Eurodollar Rate Loans, having the same
Eurodollar Interest Period.
"Business Activity Report" means (A) a Notice of
Business Activities Report from the State of New Jersey
Division of Taxation or (B) a Minnesota Business Activity
Report from the Minnesota Department of Revenue.
"Business Day" means a day, in the applicable local
time, which is not a Saturday or Sunday or a legal holiday
and on which banks are not required or permitted by law or
other governmental action to close (i) in New York, New York
or Chicago, Illinois and (ii) in the case of Eurodollar Rate
Loans, in London, England and (iii) in the case of Letter of
Credit transactions for a particular Issuing Bank, in the
place where its office for issuance or administration of the
pertinent Letter of Credit is located.
"Capital Expenditures" means, for any period, the
aggregate of all expenditures (whether paid in cash or other
Property or accrued as a liability (but without
duplication)) during such period that, in conformity with
GAAP, are required to be included in or reflected by the
Borrower's or any of its Subsidiaries' fixed asset accounts
as reflected in the consolidated balance sheet of Borrower
and its Subsidiaries; provided, however, (i) Capital
Expenditures shall include, whether or not such a
designation would be in conformity with GAAP, that portion
of Capital Leases which is capitalized on the consolidated
balance sheet of the Borrower and its Subsidiaries and
(ii) Capital Expenditures shall exclude, whether or not such
a designation would be in conformity with GAAP, expenditures
made in connection with the replacement or restoration of
Property, to the extent reimbursed or financed from insur-
ance or other recoveries received on account of the loss of
or damage to the Property being replaced or restored or from
condemnation awards arising from the taking by condemnation
or eminent domain of such Property being replaced.
"Capital Lease" means any lease of any property
(whether real, personal or mixed) by a Person as lessee
which, in conformity with GAAP, is accounted for as a
capital lease on the balance sheet of that Person.
"Capital Stock" means, with respect to any Person, any
capital stock of such Person, regardless of class or
designation, and all warrants, options, purchase rights,
conversion or exchange rights, voting rights, calls or
claims of any character with respect thereto.
"Cash" means money, currency or a credit balance in a
Deposit Account.
"Cash Collateral" means cash or Cash Equivalents held
by the Administrative Agent, any of the Issuing Banks or any
of the Lenders as security for the Obligations.
"Cash Collateral Account" means an interest bearing
account at Citibank's offices in New York, New York
designated by the Administrative Agent into which Cash
Collateral shall be deposited. The Cash Collateral Account
shall be under the sole dominion and control of the
Administrative Agent, provided that all amounts deposited
therein shall be held by the Administrative Agent for the
benefit of the Holders and shall be subject to the terms of
Sections 4.05 and 4.06.
"Cash Equivalents" means (i) marketable direct
obligations issued or unconditionally guaranteed by the
United States government and backed by the full faith and
credit of the United States government; (ii) marketable
direct obligations issued by any state of the United States
or any political subdivision of any such state or any public
instrumentality thereof which, at the time of acquisition
thereof, have the highest rating obtainable from either
Standard & Poor's Rating Group, a division of McGraw-Hill,
Inc. ("S&P") or Moody's Investors Service, Inc. (or if not
then rating such obligations, from such other nationally
recognized rating services as are reasonably acceptable to
the Administrative Agent); (iii) commercial paper which, at
the time of acquisition thereof, has the highest rating
obtainable from either S & P or Moody's Investors Service,
Inc. (or if not then rating such obligations, from such
other nationally recognized rating services as are
reasonably acceptable to the Administrative Agent); and (iv)
domestic and Eurodollar certificates of deposit and time
deposits, bankers' acceptances and floating rate
certificates of deposit issued by any Lender or any
commercial bank organized under the laws of the United
States, any state thereof, or the District of Columbia and
having a combined capital and surplus in excess of
$250,000,000, which, at the time of acquisition, are rated
A-1 (or better) by S & P or P-1 (or better) by Moody's
Investors Services, Inc.; provided, that the maturities of
such Cash Equivalents shall not exceed ninety days.
"Cash Interest Expense" means, for any period, total
interest expense, whether paid or accrued, but without
duplication, (including, without limitation, the interest
component of Capital Leases, all commissions, discounts and
other fees and charges owed with respect to letters of
credit and bankers' acceptance financing and net of the
difference between payments received by the Borrower on all
Hedge Agreements and payments made by the Borrower on all
Hedge Agreements other than the initial payments made to
enter into such Hedge Agreements; and excluding, interest
expense not payable in cash (including amortization of
discount) and legal, commitment and closing fees and
expenses and other non-recurring fees and expenses and
transaction costs payable in cash, including, without
limitation, underwriting commissions and discounts, incurred
in connection with the execution and delivery of this
Agreement and the transactions contemplated hereby) of the
Borrower, which is payable in cash, all as determined in
conformity with GAAP.
"CERCLA" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C.
9601 et seq., any amendments thereto, any successor
statutes, and any regulations promulgated thereunder.
"Change of Control" means either (i) fifty percent
(50%) (on a fully diluted basis) of the Capital Stock of RHI
ceasing to be owned and controlled by Jeffrey J. Steiner and
his "associates" as defined in the Securities Exchange Act
or (ii) one hundred percent (100%) of the Capital Stock of
Borrower ceasing to be owned and controlled by RHI.
"Citibank" means Citibank, N.A., a national banking
association.
"Citicorp" is defined in the preamble of this
Agreement.
"Claim" means any claim or demand, by any Person, of
whatsoever kind or nature for any alleged Liabilities and
Costs, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute,
Permit, ordinance or regulation, common law or otherwise.
"Closing Date" means March 13, 1996.
"CM Letter of Credit" means that certain Irrevocable
Stand-by Letter of Credit No. S-11096 in the face amount of
$166,000,000 issued by Bankers Trust Company naming the
Borrower as beneficiary.
"CM Notes" means, collectively, (i) that certain 8%
Secured Note dated January 26, 1996 in the principal amount
of $166,000,000 payable to VSI Corporation and executed by
Cincinnati Milacron Inc. and (ii) that certain 8% Unsecured
Note dated January 26, 1996 in the principal amount of
$5,376,555 payable to VSI Corporation and executed by
Cincinnati Milacron Inc.
"Collateral" means all Property and interests in Prop-
erty now owned or hereafter acquired by the Borrower or any
of its Subsidiaries upon which a Lien is granted under any
of the Loan Documents.
"Collection Account" means each lock-box and blocked
depository account maintained by the Borrower or any of its
Subsidiaries subject to a Collection Account Agreement for
the collection of Receivables and other proceeds of
Collateral.
"Collection Account Agreement" means a written
agreement, substantially in the form attached hereto as
Exhibit B with such modifications as the Administrative
Agent, from time to time, deems acceptable, among the
Borrower or a Subsidiary of the Borrower, the Administrative
Agent, and, as applicable, each of the banks at which the
Borrower or a Subsidiary of the Borrower maintains a
Collection Account.
"Commercial Letter of Credit" means any documentary
letter of credit issued by an Issuing Bank pursuant to
Section 3.01 for the account of the Borrower or for the
account of any of the Borrower's Subsidiaries if the
Borrower is jointly and severally liable for reimbursement
of amounts drawn under such letter of credit, which is
drawable upon presentation of documents evidencing the sale
or shipment of goods purchased by the Borrower or such
Subsidiary in the ordinary course of its business.
"Commission" means the Securities and Exchange Commis-
sion and any Person succeeding to the functions thereof.
"Commitment" means, with respect to any Lender at the
time of determination thereof, the aggregate amount of such
Lender's Revolving Credit Commitment and Term Loan
Commitment and "Commitments" means the aggregate amount of
all Term Loan Commitments and Revolving Credit Commitments.
"Commitment Fee" is defined in Section 5.03(c).
"Compliance Certificate" is defined in Section 8.01(a).
"Concentration Account" means the depository account
maintained at Citibank in New York, New York, or such other
financial institution designated for such purpose by the
Administrative Agent into which collections of Receivables
of the Borrower and its Domestic Subsidiaries, other
proceeds of Collateral and other amounts are transferred
pursuant to the terms of the Collection Account Agreements
or otherwise as described in Section 4.04.
"Contaminant" means any waste, pollutant, hazardous
substance, toxic substance, hazardous waste, special waste,
petroleum or petroleum-derived substance or waste,
radioactive materials, asbestos (in any form or condition),
polychlorinated biphenyls (PCBs), lead paint, or any
constituent of any such substance or waste, and includes,
but is not limited to, these terms as defined in federal,
state or local laws or regulations.
"Contractual Obligation", as applied to any Person,
means any provision of any Securities issued by that Person
or any indenture, mortgage, deed of trust, security
agreement, pledge agreement, guaranty, contract,
undertaking, agreement or instrument to which that Person is
a party or by which it or any of its properties is bound, or
to which it or any of its properties is subject.
"Convac" means Fairchild Convac GmbH, a corporation
formed under the laws of the Republic of Germany and an
indirect Subsidiary of the Borrower.
"Convac Minority Interest" means an interest in the
Capital Stock of Convac which is permitted to be issued by
Convac or transferred (whether by sale, assignment, as the
result of a merger, exchange of shares, or otherwise) by VSI
Holdings, Inc., a Delaware corporation and Wholly-Owned
Subsidiary of the Borrower, to a Person not an Affiliate of
the Borrower provided that the issuance or transfer thereof
does not result in Convac ceasing to be a Subsidiary of the
Borrower.
"Cure Loans" is defined in Section 4.02(f)(iii).
"Customary Permitted Liens" means
(i) Liens (other than Environmental Liens and Liens in
favor of the PBGC) with respect to the payment of taxes,
assessments or governmental charges in all cases which are
not yet due or which are being contested in good faith by
appropriate proceedings and with respect to which adequate
reserves or other appropriate provisions are being
maintained in accordance with GAAP;
(ii) statutory Liens of landlords and Liens of
suppliers, mechanics, carriers, materialmen, warehousemen or
workmen and other Liens imposed by law created in the
ordinary course of business for amounts not yet due or which
are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves or other
appropriate provisions are being maintained in accordance
with GAAP;
(iii) Liens (other than any Lien in favor of the PBGC)
incurred or deposits made in the ordinary course of business
in connection with worker's compensation, unemployment
insurance or other types of social security benefits or to
secure the performance of bids, tenders, sales, contracts
(other than for the repayment of borrowed money), surety,
appeal and performance bonds; provided that (A) all such
Liens do not in the aggregate materially detract from the
value of the Borrower's or any of its Subsidiaries' assets
or Property or materially impair the use thereof in the
operation of their respective businesses, and (B) all Liens
of attachment or judgment and Liens securing bonds to stay
judgments or in connection with appeals do not secure at any
time an aggregate amount exceeding $500,000; and
(iv) Liens arising with respect to zoning
restrictions, easements, licenses, reservations, covenants,
rights-of-way, utility easements, building restrictions and
other similar charges or encumbrances on the use of Real
Property which do not interfere with the ordinary conduct of
the business of the Borrower or any of its Subsidiaries.
"Deposit Account" means a demand, time, savings,
passbook or like account with a bank, savings and loan
association, credit union or like organization, other than
an account evidenced by a negotiable certificate of deposit.
"Designated Prepayment" means each mandatory
prepayment required by clauses (i), (ii), and (iii) of
Section 4.01(b).
"DOL" means the United States Department of Labor and
any Person succeeding to the functions thereof.
"Dollars" and "$" mean the lawful money of the United
States.
"Domestic Lending Office" means, with respect to any
Lender, such Lender's office, located in the United States,
specified as the "Domestic Lending Office" under its name on
the signature pages hereof or on the Assignment and
Acceptance by which it became a Lender or such other United
States office of such Lender as it may from time to time
specify by written notice to the Borrower and the
Administrative Agent.
"Domestic Subsidiaries" means those Subsidiaries of the
Borrower identified on Schedule 1.01.1 attached hereto and
made a part hereof.
"EBITDA" means, for any period, the amount calculated,
without duplication, for such period as the sum of the
Operating Units' Operating Profit and Equity Income/Minority
Interest plus (to the extent deducted in the determination
of such Operating Profit and Equity Income/Minority
Interest) (i) depreciation expense, (ii) amortization
expense, (iii) other non-recurring non-cash charges and
expenses not requiring the use of Cash, (iv) losses arising
other than in the ordinary course of business of the
Operating Units which have been included in the
determination of such Operating Profit and Equity
Income/Minority Interest, and (v) increases in the LIFO
reserve minus (to the extent included in the determination
of such Operaing Profit and Equity Income/Minority Interest)
(a) gains arising other than in the ordinary course of
business of the Operating Units, (b) decreases in the LIFO
reserve, and (c) other non-recurring credits and income not
generating Cash.
"11 7/8% Senior Subordinated Debenture Indenture" means
the Indenture between Rexnord Acquisition Corp. and Irving
Trust Company, as trustee, dated as of March 2, 1987,
pursuant to which Senior Subordinated Debentures in the
aggregate original principal amount of $126,000,000 were
issued, as supplemented by the First Supplemental Indenture
dated as of July 1, 1987 between Rexnord Corporation and
Irving Trust Company, as trustee, and the Second
Supplemental Indenture dated as of August 16, 1988, between
RHI and Irving Trust Company, as trustee.
"Eligible Assignee" means (i) a Lender or any
Affiliate thereof; (ii) a commercial bank having total
assets in excess of $2,500,000,000; (iii) the central bank
of any country which is a member of the Organization for
Economic Cooperation and Development; or (iv) a finance com-
pany, insurance company, other financial institution or
fund, acceptable to the Administrative Agent, which is
regularly engaged in making, purchasing or investing in
loans and having total assets in excess of $300,000,000.
"Environmental, Health or Safety Requirements of Law"
means all Requirements of Law derived from or relating to
any federal, state or local law, ordinance, rule,
regulation, Permit, license or other binding determination
of any Governmental Authority relating to, imposing
liability or standards concerning, or otherwise addressing,
the environment, health and/or safety, including, but not
limited to the Clean Air Act, the Clean Water Act, CERCLA,
RCRA, any so-called "Superfund" or "Superlien" law, the
Toxic Substances Control Act, OSHA, and public health codes,
each as from time to time in effect.
"Environmental Lien" means a Lien in favor of any
Governmental Authority for any (i) liabilities under any
Environmental, Health or Safety Requirement of Law, or
(ii) damages arising from, or costs incurred by such
Governmental Authority in response to, a Release or
threatened Release of a Contaminant into the environment.
"Environmental Property Transfer Acts" means any
applicable Requirement of Law that conditions, restricts,
prohibits or requires any notification or disclosure
triggered by the transfer, sale, lease or closure of any
Property or deed or title for any Property for environmental
reasons, including, but not limited to, any so-called
"Industrial Site Recovery Acts" or "Responsible Property
Transfer Acts".
"Equipment" means, with respect to any Person, all of
such Person's present and future (i) equipment, including,
without limitation, machinery, manufacturing, distribution,
selling, data processing and office equipment, assembly
systems, tools, molds, dies, fixtures, appliances,
furniture, furnishings, vehicles, vessels, aircraft,
aircraft engines, and trade fixtures, (ii) other tangible
personal property (other than such Person's Inventory), and
(iii) any and all accessions, parts and appurtenances
attached to any of the foregoing or used in connection
therewith, and any substitutions therefor and replacements,
products and proceeds thereof.
"ERISA" means the Employee Retirement Income Security
Act of 1974, 29 U.S.C. 1000 et seq., any amendments
thereto, any successor statutes, and any regulations or
guidance promulgated thereunder.
"ERISA Affiliate" means (i) any corporation which is a
member of the same controlled group of corporations (within
the meaning of Section 414(b) of the Internal Revenue Code)
as the Borrower; (ii) a partnership or other trade or
business (whether or not incorporated) which is under common
control (within the meaning of Section 414(c) of the
Internal Revenue Code) with the Borrower; and (iii) a member
of the same affiliated service group (within the meaning of
Section 414(m) of the Internal Revenue Code) as the
Borrower, any corporation described in clause (i) above or
any partnership or trade or business described in clause
(ii) above.
"ERISA Event" means (i) the occurrence with respect to
a Plan of a Reportable Event, (ii) the provision by the
administrator of any Plan of a notice of intent to terminate
such Plan, pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment
referred to in Section 4041(e) of ERISA), (iii) the
cessation of operations at a facility of the Borrower or any
ERISA Affiliate in the circumstances described in Section
4062(e) of ERISA, (iv) the withdrawal by the Borrower or an
ERISA Affiliate from a Multiemployer Plan during a plan year
for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA, (v) the conditions set forth in
Section 302(f)(1)(A) and (B) of ERISA to the creation of a
Lien upon Property or rights to Property of the Borrower or
any ERISA Affiliate for failute to make a required payment
to a Plan are satisfied, (vi) the adoption of an amendment
to a Plan requiring the provision of security to such Plan,
pursuant to Section 307 of ERISA, or (vii) the institution
by the PBGC of proceedings to terminate a Plan, pursuant to
Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA that
constitutes grounds for the termination of, or the
appointment of a trustee to administer, a Plan.
"Eurodollar Affiliate" means, with respect to each
Lender, the Affiliate of such Lender (if any) set forth
below such Lender's name under the heading "Eurodollar
Affiliate" on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or
such Affiliate of a Lender as it may from time to time
specify by written notice to the Borrower and the
Administrative Agent.
"Eurodollar Interest Payment Date" means, with respect
to any Eurodollar Rate Loan, the last day of each Eurodollar
Interest Period applicable to such Loan.
"Eurodollar Interest Period" is defined in
Section 5.02(b).
"Eurodollar Interest Rate Determination Date" is
defined in Section 5.02(c).
"Eurodollar Lending Office" means, with respect to any
Lender, the office or offices of such Lender (if any) set
forth below such Lender's name under the heading "Eurodollar
Lending Office" on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or
such office or offices of such Lender as it may from time to
time specify by written notice to the Borrower and the
Administrative Agent.
"Eurodollar Rate" means, with respect to any Eurodollar
Interest Period applicable to a Eurodollar Rate Loan, an
interest rate per annum obtained by dividing (i) the Base
Eurodollar Rate applicable to that Eurodollar Interest
Period by (ii) a percentage equal to 100% minus the
Eurodollar Reserve Percentage in effect on the relevant
Eurodollar Interest Rate Determination Date.
"Eurodollar Rate Loans" means those Loans outstanding
which bear interest at a rate determined by reference to the
Eurodollar Rate and the Eurodollar Rate Margin as provided
in Section 5.01(a).
"Eurodollar Rate Margin" means a rate equal to one and
one-half percent (1.50%) per annum.
"Eurodollar Reserve Percentage" means, for any
Eurodollar Interest Period, the reserve percentage which is
applicable two (2) Business Days before the first day of
such Eurodollar Interest Period under the regulations issued
from time to time by the Federal Reserve Board for
determining the actual reserve requirement (including,
without limitation, any emergency, supplemental or other
marginal reserve requirement) for a member bank of the
Federal Reserve System in New York, New York with deposits
exceeding Five Billion Dollars ($5,000,000,000) with respect
to liabilities or assets consisting of or including
"Eurocurrency Liabilities" (or with respect to any other
category of liabilities which includes deposits by reference
to which the interest rate on Eurodollar Rate Loans is
determined) having a term equal to such Eurodollar Interest
Period.
"Event of Default" means any of the occurrences set
forth in Section 12.01 after the expiration of any
applicable grace period, as expressly provided in Section
12.01.
"Excluded Dispositions" means (i) operations and/or
assets of the Borrower or a Subsidiary of the Borrower
located at Chatsworth, California, Farmingdale, New York,
Redondo Beach, California, and Temple City, California (the
"Natter property"); (ii) the "Greer real estate" located in
Houston, Texas; (iii) the Convac Minority Interest; and (iv)
the "Sloane Street real estate" located in London.
"Fair Market Value" means, with respect to any asset,
the value of the consideration obtainable in a sale of such
asset in the open market, assuming a sale by a willing
seller to a willing purchaser dealing at arm's length and
arranged in an orderly manner over a reasonable period of
time, each having reasonable knowledge of the nature and
characteristics of such asset, neither being under any
compulsion to act, and, if in excess of $500,000, as
determined (a) in good faith by the Board of Directors of
the Borrower or (b) in an appraisal of such asset, provided
that for purposes of Section 10.02, such appraisal was
performed relatively contemporaneously with such sale by an
independent third party appraiser and the basic assumptions
underlying such appraisal have not materially changed since
the date thereof.
"Federal Funds Rate" means, for any period, a fluctu-
ating interest rate per annum equal for each day during such
period to the weighted average of the rates on overnight
federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business
Day in New York, New York, for the next preceding Business
Day) in New York, New York by the Federal Reserve Bank of
New York, or if such rate is not so published for any day
which is a Business Day in New York, New York, the average
of the quotations for such day on such transactions received
by the Administrative Agent from three federal funds brokers
of recognized standing selected by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System or any Governmental Authority
succeeding to its functions.
"Fee Letter" means that certain fee letter addressed to
Citicorp Securities, Inc. from the Borrower dated January
22, 1996.
"FII" means Fairchild Industries, Inc., a Delaware
corporation.
"Financial Statements" means (i) statements of income
and retained earnings, statements of cash flow, and balance
sheets, (ii) such other financial statements as TFC, RHI,
the Borrower and its Subsidiaries shall routinely and
regularly prepare and (iii) such other financial statements
as the Administrative Agent or the Requisite Lenders may
from time to time reasonably specify.
"Fiscal Year" means the fiscal year of the Borrower and
its Subsidiaries for accounting and tax purposes, which
shall be the 12-month period ending on June 30 of each
calendar year.
"Foreign Employee Benefit Plan" means any employee
benefit plan as defined in Section 3(3) of ERISA which is
maintained or contributed to for the benefit of the
employees of the Borrower, any of its Subsidiaries or any of
its ERISA Affiliates and is not covered by ERISA pursuant to
ERISA Section 4(b)(4).
"Foreign Pension Plan" means any employee benefit plan
as defined in Section 3(3) of ERISA which (i) is maintained
or contributed to for the benefit of employees of the
Borrower, any of its Subsidiaries or any of its ERISA
Affiliates, (ii) is not covered by ERISA pursuant to Section
4(b)(4) of ERISA, and (iii) under applicable local law, is
required to be funded through a trust or other funding
vehicle.
"Fronting Fee" is defined in Section 5.03(b).
"Funding Date" means, with respect to any Loan, the
date of funding of such Loan.
"GAAP" means generally accepted accounting principles
set forth in the opinions and pronouncements of the American
Institute of Certified Public Accountants' Accounting
Principles Board and Financial Accounting Standards Board or
in such other statements by such other entity as may be in
general use by significant segments of the accounting
profession as in effect on the date hereof (unless otherwise
specified herein as in effect on another date or dates).
"General Intangibles" means, with respect to any
Person, all of such Person's present and future (i) general
intangibles, (ii) rights, interests, choses in action,
causes of action, claims and other intangible Property of
every kind and nature (other than Receivables), (iii)
corporate and other business records, (iv) loans, royalties,
and other obligations receivable, (v) trademarks, registered
trademarks, trademark applications, service marks,
registered service marks, service mark applications,
patents, registered patents, patent applications, trade
names, rights of use of any name, labels, fictitious names,
inventions, designs, trade secrets, computer programs,
software, printouts and other computer materials, goodwill,
registrations, copyrights, copyright applications, permits,
licenses, franchises, customer lists, credit files,
correspondence, and advertising materials, (vi) customer and
supplier contracts, firm sale orders, rights under license
and franchise agreements, rights under tax sharing
agreements, and other contracts and contract rights, (vii)
interests in partnerships and joint ventures, (viii) tax
refunds and tax refund claims, (ix) right, title and
interest under leases, subleases, licenses and concessions
and other agreements relating to property, (x) deposit
accounts (general or special) with any bank or other
financial institution, (xi) credits with and other claims
against third parties (including carriers and shippers),
(xii) rights to indemnification and with respect to support
and keep-well agreements, (xiii) reversionary interests in
pension and profit sharing plans and reversionary,
beneficial and residual interests in trusts, (xiv) letters
of credit, guarantees, Liens, security interests and other
security held by or granted to such Person and (xvi)
uncertificated securities.
"Governmental Authority" means any nation or
government, any federal, state, local or other political
subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Guarantors" means each of the Subsidiaries of the
Borrower identified on Schedule 1.01.2 attached hereto and
made a part hereof and any other Person executing and
delivering a guaranty of payment and performance of all or
any portion of the Obligations.
"Hedge Agreement" means any agreement, including,
without limitation, interest rate exchange, swap, collar or
cap agreement, interest rate future or option contract,
currency swap agreement, currency future or option contract,
and other similar agreement, evidencing an agreement or
arrangement intended to protect against fluctuation in
interest rates and/or foreign exchange rates or conversion
rates for conversion of foreign currencies to Dollars.
"Holder" means any Person entitled to enforce any of
the Obligations, whether or not such Person holds any
evidence of Indebtedness, including, without limitation, the
Administrative Agent, each Lender and each Issuing Bank.
"Indebtedness", as applied to any Person, means, at any
time, without duplication, (a) all indebtedness, obligations
or other liabilities of such Person (i) for borrowed money
or evidenced by debt Securities, debentures, acceptances,
notes or other similar instruments, and any accrued
interest, fees and charges relating thereto, (ii) under
profit payment agreements or in respect of obligations to
redeem, repurchase or exchange any Securities of such Person
or to pay dividends in respect of any Capital Stock, (iii)
with respect to letters of credit issued for such Person's
account, (iv) to pay the deferred purchase price of property
or services, except accounts payable and accrued expenses
arising in the ordinary course of business, (v) in respect
of Capital Leases, (vi) which are Accommodation Obligations
or (vii) under warranties and indemnities; (b) all
indebtedness, obligations or other liabilities of such
Person or others secured by a Lien on any property of such
Person, whether or not such indebtedness, obligations or
liabilities are assumed by such Person, all as of such time;
(c) all indebtedness, obligations or other liabilities of
such Person in respect of interest rate contracts, Hedge
Agreements and foreign exchange contracts, net of
liabilities owed to such Person by the counterparties
thereon; (d) all preferred stock subject (upon the
occurrence of any contingency or otherwise) to mandatory
redemption; and (e) all contingent Contractual Obligations
with respect to any of the foregoing.
"Indemnified Matters" is defined in Section 15.03.
"Indemnitees" is defined in Section 15.03.
"Interest Coverage Ratio" means, for any period, the
ratio of (i) Borrower's interest income (accrued or
received)for such period to (ii) Cash Interest Expense for
such period.
"Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended to the date hereof and from time to time
hereafter, any successor statute and any regulations or
guidance promulgated thereunder.
"Inventory" means, with respect to any Person, all of
such Person's present and future (i) inventory, (ii) goods,
merchandise and other personal property furnished or to be
furnished under any contract of service or intended for sale
or lease, and all consigned goods and all other items which
have previously constituted Equipment of such Person but are
then currently being held for sale or lease in the ordinary
course of such Person's business, (iii) raw materials,
work-in-process and finished goods, (iv) materials and
supplies of any kind, nature or description used or consumed
in such Person's business or in connection with the
manufacture, production, packing, shipping, advertising,
finishing or sale of any of the property described in
clauses (i) through (iii) above, (v) goods in which such
Person has a joint or other interest or right of any kind
(including, without limitation, goods in which such Person
has an interest or right as consignee), and (vi) goods which
are returned to or repossessed by such Person; in each case
whether in the possession of such Person, a bailee, a
consignee, or any other Person for sale, storage, transit,
processing, use or otherwise, and any and all documents for
or relating to any of the foregoing.
"Investment" means, with respect to any Person, (i) any
purchase or other acquisition by that Person of Securities,
or of a beneficial interest in Securities, issued by any
other Person, (ii) any purchase by that Person of all or
substantially all of the assets of a business conducted by
another Person, and (iii) any loan, advance (other than
deposits with financial institutions available for
withdrawal on demand, prepaid expenses, accounts receivable,
advances to employees and similar items made or incurred in
the ordinary course of business) or capital contribution by
that Person to any other Person, including all Indebtedness
to such Person arising from a sale of property by such
Person other than in the ordinary course of its business and
all Indebtedness to such Person which is not a current
asset. The amount of any Investment shall be the original
cost of such Investment, plus the cost of all additions
thereto less the amount of any return of capital or
principal to the extent such return is in cash with respect
to such Investment without any adjustments for increases or
decreases in value or write-ups, write-downs or write-offs
with respect to such Investment.
"IRS" means the Internal Revenue Service and any Person
succeeding to the functions thereof.
"Issuing Banks" means Citibank and each Lender
designated as an "Issuing Bank" on the signature pages
hereof or the signature page of the Assignment and
Acceptance by which it became a Lender and each other Lender
approved by the Administrative Agent and the Borrower who
has agreed to become an Issuing Bank for the purpose of
issuing Letters of Credit pursuant to Section 3.01.
"Lender" means, as of the Closing Date, each financial
institution a signatory hereto as a Lender and, at any other
given time, each financial institution which is a party
hereto as a Lender, whether as a signatory hereto or
pursuant to an Assignment and Acceptance.
"Letter of Credit" means any Commercial Letter of
Credit or Standby Letter of Credit.
"Letter of Credit Fee" is defined in Section 5.03(b).
"Letter of Credit Obligations" means, at any particular
time, the sum of (i) all outstanding Reimbursement
Obligations, plus (ii) the aggregate undrawn face amount of
all outstanding Letters of Credit, plus (iii) the aggregate
face amount of all Letters of Credit requested by the
Borrower but not yet issued (unless the request for an
unissued Letter of Credit has been denied by the designated
Issuing Bank as referenced in Section 3.01(c)(i)).
"Letter of Credit Reimbursement Agreement" means, with
respect to a Letter of Credit, such form of application
therefor and form of reimbursement agreement therefor
(whether in a single or several documents, taken together)
as the Issuing Bank from which the Letter of Credit is
requested may employ in the ordinary course of business for
its own account, with such modifications thereto as may be
agreed upon by the Issuing Bank and the Borrower and as are
not materially adverse (in the judgment of the Issuing Bank
and Administrative Agent) to the interests of the Lenders;
provided, however, in the event of any conflict between the
terms of any Letter of Credit Reimbursement Agreement and
this Agreement, the terms of this Agreement shall control.
"Liabilities and Costs" means all liabilities,
obligations, responsibilities, losses, damages, personal
injury, death, punitive damages, economic damages,
consequential damages, treble damages, intentional, willful
or wanton injury, damage or threat to the environment,
natural resources or public health or welfare, costs and
expenses (including, without limitation, attorney, expert
and consulting fees and costs and fees and costs associated
with any investigation, feasibility or Remedial Action
studies), fines, penalties and monetary sanctions, interest,
direct or indirect, known or unknown, absolute or
contingent, past, present or future.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, conditional sale agreement,
deposit arrangement, security interest, encumbrance, lien
(statutory or other and including, without limitation, any
Environmental Lien), preference, priority or other security
agreement or preferential arrangement of any kind or nature
whatsoever in respect of any property of a Person, whether
granted voluntarily or imposed by law, and includes the
interest of a lessor under a Capital Lease or under any
financing lease having substantially the same economic
effect as any of the foregoing and the filing of any
financing statement or similar notice (other than a
financing statement filed by a "true" lessor pursuant to 9-
408 of the Uniform Commercial Code), naming the owner of
such property as debtor, under the Uniform Commercial Code
or other comparable law of any jurisdiction.
"Loan Account" is defined in Section 4.03(b).
"Loan Documents" means this Agreement, the Notes, Hedge
Agreements to which any Lender or any Affiliate of a Lender
is a party, foreign exchange contracts to which any Lender
or any Affiliate of a Lender is a party, and all other
instruments, agreements and written Contractual Obligations
between the Borrower or any Subsidiary of the Borrower and
any of the Administrative Agent, any Lender or any Issuing
Bank delivered to either the Administrative Agent, such
Lender or such Issuing Bank pursuant to or in connection
with the transactions contemplated hereby.
"Loans" means all Term Loans and Revolving Loans,
whether Base Rate Loans or Eurodollar Rate Loans.
"Margin Stock" means "margin stock" as such term is
defined in Regulation U and Regulation G.
"Material Adverse Effect" means a material adverse
effect upon (i) the financial condition, operations, assets
or prospects of the Borrower or any of its Subsidiaries,
(ii) the ability of the Borrower or any of its Subsidiaries
to perform their respective obligations under the Loan Docu-
ments, or (iii) the ability of the Lenders, the Issuing
Banks or the Administrative Agent to enforce any of the Loan
Documents.
"MIS" means computerized management information system
for recording and maintenance of information regarding
purchases, sales, aging, categorization, and locations of
Inventory, creation and aging of Receivables, and accounts
payable (including agings thereof).
"Multiemployer Plan" means a "multiemployer plan" as
defined in Section 4001(a)(3) of ERISA (other than a Foreign
Employee Benefit Plan) which (i) is, or within the
immediately preceding six (6) years was, contributed to by
either the Borrower or any ERISA Affiliate or in respect of
which the Borrower or any ERISA Affiliate has assumed any
liability and (ii) is not a Foreign Employee Benefit Plan.
"Net Cash Proceeds of Issuance of Equity Securities"
means (i) net cash proceeds (including cash, equivalents
readily convertible into cash, and such proceeds of any
notes received as consideration or any other non-cash
consideration) received by the Borrower or any of its
Subsidiaries at any time after the Closing Date on account
of the issuance of equity Securities of the Borrower or any
of its Subsidiaries (other than (a) Capital Stock of a
Subsidiary issued to the Borrower or to a Subsidiary of the
Borrower and (b) Capital Stock issued to effect the transfer
of the Convac Minority Interest) and (ii) proceeds received
by the Borrower at any time after the Closing Date as a
contribution to its capital on account of the issuance of
equity Securities of the Borrower.
"Net Cash Proceeds of Issuance of Indebtedness" means
Indebtedness (other than Indebtedness permitted under
Section 10.01) of the Borrower or any of its Subsidiaries,
in each case net of all transaction costs and underwriters'
discounts with respect thereto.
"Net Cash Proceeds of Sale" means (i) proceeds received
by the Borrower or any of its Subsidiaries in cash
(including cash, equivalents readily convertible into cash,
and such proceeds of any notes received as consideration or
any other non-cash consideration) from the sale, assignment
or other disposition of (but not the lease or license of)
any Property, other than sales permitted under clauses (b)
through (e) of Section 10.02, net of (A) the costs of sale,
assignment or other disposition, (B) any income, franchise,
transfer or other tax liability arising from such
transaction and (C) amounts applied to the repayment of
Indebtedness (other than the Obligations) secured by a Lien
permitted by Section 10.03 on the asset disposed of, whether
such net proceeds arise from any individual sale, assignment
or other disposition or from any group of related sales,
assignments or other dispositions; and (ii) to the extent
provided in Section 9.07(b), proceeds of insurance on
account of the loss of or damage to any such Property or
Properties, and payments of compensation for any such
Property or Properties taken by condemnation or eminent
domain.
"Net Income" means, for any period, the net income (or
loss) after taxes of the Borrower and its Subsidiaries on a
consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP.
"Net Insurance and Condemnation Proceeds" means
proceeds (including cash, equivalents readily convertible
into cash, and such proceeds of any notes received in lieu
of cash) of insurance policies described in Section 9.07 and
proceeds of condemnation awards described in Section 9.07
required to be remitted to the Administrative Agent as
provided in Section 9.07(b).
"1992 Credit Agreement" is defined in Section 6.01(d).
"Non Pro Rata Loan" is defined in Section 4.02(f).
"Note" means a promissory note in the form attached
hereto as Exhibit C payable to a Lender, evidencing certain
of the Obligations of the Borrower to such Lender and
executed by the Borrower as required by Section 4.03(a), as
the same may be amended, supplemented, modified or restated
from time to time, and any promissory note issued in
substitution therefor; "Notes" means, collectively, all of
such Notes outstanding at any given time.
"Notice of Borrowing" means a notice substantially in
the form of Exhibit D attached hereto and made a part
hereof.
"Notice of Conversion/Continuation" means a notice
substantially in the form of Exhibit E attached hereto and
made a part hereof with respect to a proposed conversion or
continuation of a Loan pursuant to Section 5.01(c).
"Obligations" means all Loans, advances, debts,
liabilities, obligations, covenants and duties owing by the
Borrower to the Administrative Agent, any Lender, any
Issuing Bank, any Affiliate of the Administrative Agent, any
Lender or any Issuing Bank, or any Person entitled to
indemnification pursuant to Section 15.03 of this Agreement,
of any kind or nature, present or future, whether or not
evidenced by any note, guaranty or other instrument, arising
under this Agreement, the Notes or any other Loan Document,
whether or not for the payment of money, whether arising by
reason of an extension of credit, opening or amendment of a
Letter of Credit or payment of any draft drawn thereunder,
loan, guaranty, indemnification, foreign exchange contract,
Hedge Agreement or in any other manner, whether direct or
indirect (including those acquired by assignment), absolute
or contingent, due or to become due, now existing or
hereafter arising and however acquired. The term includes,
without limitation, all interest, charges, expenses, fees,
attorneys' fees and disbursements and any other sum charge-
able to the Borrower under this Agreement or any other Loan
Document.
"Officer's Certificate" means, as to a corporation, a
certificate executed on behalf of such corporation by the
chairman or vice-chairman of its board of directors (if an
officer of such corporation) or its president, any of its
vice-presidents, its chief financial officer, or its
treasurer.
"Operating Profit and Equity Income/Minority Interest"
means an amount equal to total sales minus cost of sales
minus total operating expenses and includes other
(income)/expense, Investment (income)/expense, goodwill
amortization, equity (in earnings)/loss, and minority
interest (income)/loss.
"Operating Lease" means, as applied to any Person, any
lease of any property (whether real, personal or mixed) by
that Person as lessee which is not a Capital Lease.
"Operating Units" means, collectively, those segments
of the Borrower's business known as (i) Fairchild Fasteners
U.S., (ii) Fairchild Fasteners - Europe, (iii) Camloc (UK)
Gas Spring Division, and (iv) Convac GmbH; and each of the
foregoing is an "Operating Unit".
"Organizational Documents" means, with respect to any
corporation, limited liability company, or partnership
(i) the articles/certificate of incorporation (or the
equivalent organizational documents) of such corporation or
limited liability company, (ii) the partnership agreement
executed by the partners in the partnership, (iii) the
by-laws (or the equivalent governing documents) of the
corporation, limited liability company or partnership, and
(iv) any document setting forth the designation, amount
and/or relative rights, limitations and preferences of any
class or series of such corporation's Capital Stock or such
limited liability company's or partnership's equity or
ownership interests.
"OSHA" means the Occupational Safety and Health Act of
1970, 29 U.S.C. 651 et seq., any amendments thereto, any
successor statutes and any regulations or guidance
promulgated thereunder.
"PBGC" means the Pension Benefit Guaranty Corporation
and any Person succeeding to the functions thereof.
"Permits" means any permit, approval, authorization
license, variance, or permission required from a
Governmental Authority or other Person under an applicable
Requirement of Law.
"Permitted Equity Securities Options" means the
subscriptions, options, warrants, rights, convertible
securities and other agreements or commitments relating to
the issuance of equity Securities of the Borrower or any
Subsidiary of the Borrower identified as such on Schedule
1.01.3.
"Permitted Existing Accommodation Obligations" means
those Accommodation Obligations of the Borrower and its
Subsidiaries identified as such on Schedule 1.01.4.
"Permitted Existing Indebtedness" means the Indebted-
ness of the Borrower and its Subsidiaries identified as such
on Schedule 1.01.5.
"Permitted Existing Investments" means those Invest-
ments identified as such on Schedule 1.01.6.
"Permitted Existing Liens" means the Liens on assets of
the Borrower or any of its Subsidiaries identified as such
on Schedule 1.01.7.
"Person" means any natural person, corporation, limited
liability company, limited partnership, general partnership,
joint stock company, joint venture, association, company,
trust, bank, trust company, land trust, business trust or
other organization, whether or not a legal entity, and any
Governmental Authority.
"Plan" means an employee benefit plan defined in
Section 3(3) of ERISA (other than a Foreign Employee Benefit
Plan) (i) in respect of which the Borrower or any ERISA
Affiliate is, or within the immediately preceding six (6)
years was, an "employer" as defined in Section 3(5) of ERISA
or the Borrower or any ERISA Affiliate has assumed any
liability and (ii) which is not a Foreign Employee Benefit
Plan.
"Potential Event of Default" means an event which, with
the giving of notice or the lapse of time, or both, would
constitute an Event of Default.
"Process Agent" is defined in Section 15.17(a)(i).
"Pro Forma" means the unaudited pro forma opening
balance sheet of the Borrower and its Subsidiaries attached
hereto as Exhibit F, prepared in accordance with GAAP, dated
December 31, 1995, and giving effect to the extensions of
credit contemplated hereby, the sales of assets of the D-M-E
Division of VSI and Fairchild Data Corporation, the merger
of FII and Shared Technologies, Inc., the merger of D-M-E
Normalien GmbH and Fairchild Convac GmbH, and the transfer
of the Harco business to Banner Aerospace, Inc.
"Projections" means the financial projections
(including, without limitation, capital expenditure budget)
and assumptions prepared by the Borrower dated February 16,
1996 and attached hereto as Exhibit G.
"Property" means any Real Property or personal prop-
erty, plant, building, facility, structure, underground
storage tank or unit, Equipment, Inventory, General
Intangible, Receivable, or other asset owned, leased or
operated by the Borrower or any Subsidiary of the Borrower,
as applicable, (including any surface water thereon, and
soil and groundwater thereunder).
"Proposal Letter" means that certain letter addressed
to the Borrower from Citicorp Securities, Inc. dated January
16, 1996 and accepted by the Borrower on January 18, 1996.
"Pro Rata Share" means, with respect to any Lender, the
percentage obtained by dividing (i) the sum of such Lender's
Term Loan Commitment and Revolving Credit Commitment (in
each case, as adjusted from time to time in accordance with
the provisions of this Agreement or any Assignment and
Acceptance to which such Lender is a party) by (ii) the
aggregate amount of all of the Term Loan Commitments and
Revolving Credit Commitments (notwithstanding the
termination of any such Commitments).
"Protective Advance" is defined in Section 13.09(a).
"RCRA" means the Resource Conservation and Recovery Act
of 1976, 42 U.S.C. 6901 et seq., any amendments thereto,
any successor statutes, and any regulations promulgated
thereunder.
"Real Property" means, with respect to any Person, all
of such Person's present and future right, title and
interest (including, without limitation, any leasehold
estate) in (i) any plots, pieces or parcels of land, (ii)
any improvements, buildings, structures and fixtures now or
hereafter located or erected thereon or attached thereto of
every nature whatsoever (the rights and interests described
in clauses (i) and (ii) above being the "Premises"), (iii)
all easements, rights of way, gores of land or any lands
occupied by streets, ways, alleys, passages, sewer rights,
water courses, water rights and powers, and public places
adjoining such land, and any other interests in property
constituting appurtenances to the Premises, or which
hereafter shall in any way belong, relate or be appurtenant
thereto, (iv) all hereditaments, gas, oil, minerals (with
the right to extract, sever and remove such gas, oil and
minerals), and easements, of every nature whatsoever,
located in or on the Premises and (v) all other rights and
privileges thereunto belonging or appertaining and all
extensions, additions, improvements, betterments, renewals,
substitutions and replacements to or of any of the rights
and interests described in clauses (iii) and (iv) above.
"Receivables" means, with respect to any Person, all of
such Person's present and future (i) accounts, (ii) contract
rights, chattel paper, instruments, documents, deposit
accounts, and other rights to payment of any kind, whether
or not arising out of or in connection with the sale or
lease of goods or the rendering of services, and whether or
not earned by performance, (iii) any of the foregoing which
are not evidenced by instruments or chattel paper, (iv)
intercompany receivables, and any security documents
executed in connection therewith, (v) proceeds of any
letters of credit or insurance policies on which such Person
is named as beneficiary, (vi) claims against third parties
for advances and other financial accommodations and any
other obligations whatsoever owing to such Person, (vii)
rights in and to all security agreements, leases,
guarantees, instruments, securities, documents of title and
other contracts securing, evidencing, supporting or
otherwise relating to any of the foregoing, together with
all rights in any goods, merchandise or Inventory which any
of the foregoing may represent, and (viii) rights in
returned and repossessed goods, merchandise and Inventory
which any of the same may represent, including, without
limitation, any right of stoppage in transit.
"Refinanced Indebtedness" means the Indebtedness of the
Borrower or any of its Subsidiaries which is to be repaid or
defeased out of the proceeds of the Loans made on the
Closing Date and identified as such on Schedule 1.01.8.
"Register" is defined in Section 15.01(c).
"Regulation A" means Regulation A of the Federal
Reserve Board as in effect from time to time.
"Regulation G" means Regulation G of the Federal
Reserve Board as in effect from time to time.
"Regulation T" means Regulation T of the Federal
Reserve Board as in effect from time to time.
"Regulation U" means Regulation U of the Federal
Reserve Board as in effect from time to time.
"Regulation X" means Regulation X of the Federal
Reserve Board as in effect from time to time.
"Reimbursement Date" is defined in Section
3.01(d)(i)(A).
"Reimbursement Obligations" means the aggregate non-
contingent reimbursement or repayment obligations of the
Borrower with respect to amounts drawn under Letters of
Credit.
"Release" means any release, spill, emission, leaking,
pumping, pouring, dumping, injection, deposit, disposal,
abandonment, or discarding of barrels, containers or other
receptacles, discharge, emptying, escape, dispersal,
leaching or migration into the indoor or outdoor environment
or into or out of any Property, including the movement of
Contaminants through or in the air, soil, surface water,
groundwater or Property.
"Remedial Action" means actions required to (i) clean
up, remove, treat or in any other way address Contaminants
in the indoor or outdoor environment; (ii) prevent the
Release or threat of Release or minimize the further Release
of Contaminants; or (iii) investigate and determine if a
remedial response is needed and to design such a response
and post-remedial investigation, monitoring, operation and
maintenance and care.
"Replacement Proceeds" means the amount of (i) proceeds
of insurance paid on account of the loss of or damage to any
Property and awards of compensation for Property taken by
condemnation or eminent domain to the extent actually used
to replace, rebuild or restore the Property so lost, damaged
or taken, provided that Borrower shall have delivered
written notice to the Administrative Agent that it or its
applicable Subsidiary intends to so replace, rebuild or
restore such Property within 90 days after the
Administrative Agent's receipt of the proceeds of such
insurance payment or condemnation award if such proceeds
exceed $500,000 and (ii) insurance paid on account of a
business interruption occurrence to the extent actually used
in the restoration or conduct of the business interrupted.
"Reportable Event" means any of the events described in
Section 4043(c) of ERISA and the regulations promulgated
thereunder as in effect from time to time other than an
event for which the thirty (30) day notice requirement has
been waived by the PBGC.
"Requirements of Law" means, as to any Person, the
charter and by-laws or other organizational or governing
documents of such Person, and any law, rule or regulation,
or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which
such Person or any of its property is subject including,
without limitation, the Securities Act, the Securities
Exchange Act, Regulations G, T, U and X, ERISA, the Fair
Labor Standards Act, the Worker Adjustment and Retraining
Notification Act, Americans with Disabilities Act of 1990,
and any certificate of occupancy, zoning ordinance,
building, environmental or land use requirement or Permit
and Environmental, Health or Safety Requirement of Law.
"Requisite Lenders" means Lenders whose Pro Rata
Shares, in the aggregate, are greater than fifty-one percent
(51%); provided, however, that, in the event any of the
Lenders shall have failed to fund its Pro Rata Share of any
Revolving Loan requested by the Borrower which such Lenders
are obligated to fund under the terms of this Agreement and
any such failure has not been cured, then for so long as
such failure continues, "Requisite Lenders" means Lenders
(excluding all Lenders whose failure to fund their
respective Pro Rata Shares of such Revolving Loans have not
been so cured) whose Pro Rata Shares represent more than
fifty-one percent (51%) of the aggregate Pro Rata Shares of
such Lenders; provided, further, however, that, in the event
that the Commitments have been terminated pursuant to the
terms of this Agreement, "Requisite Lenders" means Lenders
(without regard to such Lenders' performance of their
respective obligations hereunder) whose aggregate ratable
shares (stated as a percentage) of the aggregate outstanding
principal balance of all Loans are greater than fifty-one
percent (51%).
"Restricted Junior Payment" means (i) any dividend or
other distribution, direct or indirect, on account of any
shares of any class of Capital Stock of the Borrower or any
of its Subsidiaries now or hereafter outstanding, except a
dividend payable solely in shares of that class of stock or
in any junior class of stock to the holders of that class,
(ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of equity Securities of
the Borrower or any of its Subsidiaries now or hereafter
outstanding, (iii) any payment or prepayment of principal
of, premium, if any, or interest, fees or other charges on
or with respect to, and any redemption, purchase,
retirement, defeasance, sinking fund or similar payment and
any claim for rescission with respect to, any Indebtedness
for borrowed money other than the Obligations and (iv) any
payment made to redeem, purchase, repurchase or retire, or
to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of
Capital Stock of the Borrower or any of its Subsidiaries now
or hereafter outstanding.
"Revolving Credit Availability" means, at any
particular time, the amount by which the Revolving Credit
Commitments at such time exceed the Revolving Credit
Obligations at such time.
"Revolving Credit Commitment" means, with respect to
any Lender, the obligation of such Lender to make Revolving
Loans and to participate in Letters of Credit pursuant to
the terms and conditions of this Agreement, in an aggregate
amount at any time outstanding which shall not exceed the
principal amount set forth opposite such Lender's name under
the heading "Revolving Credit Commitment" on the signature
pages hereof or the signature page of the Assignment and
Acceptance by which it became a Lender, as modified from
time to time pursuant to the terms of this Agreement or to
give effect to any applicable Assignment and Acceptance, and
"Revolving Credit Commitments" means the aggregate principal
amount of the Revolving Credit Commitments of all the
Lenders, the maximum amount of which shall be $50,000,000,
as reduced from time to time pursuant to Section 4.01.
"Revolving Credit Obligations" means, at any particular
time, the sum of (i) the outstanding principal amount of the
Revolving Loans at such time, plus (ii) the Letter of Credit
Obligations at such time.
"Revolving Credit Pro Rata Share" means, with respect
to any Revolving Lender, the percentage obtained by dividing
(i) such Revolving Lender's Revolving Credit Commitment (in
each case, as adjusted from time to time in accordance with
the provisions of this Agreement or any Assignment and
Acceptance to which such Lender is a party) by (ii) the
aggregate amount of all of the Revolving Credit Commitments.
"Revolving Credit Termination Date" means the earliest
to occur of (i) July 29, 1996 (or, if not a Business Day,
the next preceding Business Day), (ii) the date of
termination of the Revolving Credit Commitments pursuant to
the terms of this Agreement, and (iii) the date of
acceleration of the Obligations pursuant to Section 12.02.
"Revolving Lenders" means those Lenders having a
Revolving Credit Commitment; and "Revolving Lender" means
one of the Revolving Lenders, individually.
"Revolving Loan" is defined in Section 2.02(a).
"Revolving Notes" means promissory notes executed by
Borrower and delivered to the Lenders evidencing the
Revolving Loans, as the same may be amended, supplemented,
modified or restated from time to time, and any promissory
note issued in substitution therefor, substantially in the
form attached hereto as Exhibit C-1; and "Revolving Note"
means any one of the Revolving Notes.
"RHI" means RHI Holdings, Inc., a Delaware corporation.
"Securities" means any Capital Stock, shares, voting
trust certificates, limited partnership certificates, bonds,
debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as
"securities", including, without limitation, any "security"
as such term is defined in Section 8-102 of the Uniform
Commercial Code, or any certificates of interest, shares, or
participations in temporary or interim certificates for the
purchase or acquisition of, or any right to subscribe to,
purchase or acquire any of the foregoing, but shall not
include the Notes or any other evidence of the Obligations.
"Securities Act" means the Securities Act of 1933, as
amended from time to time, and any successor statute.
"Securities Exchange Act" means the Securities Exchange
Act of 1934, as amended from time to time, and any successor
statute.
"Solvent", when used with respect to any Person, means
that at the time of determination:
(i) the Fair Market Value of its assets is in excess
of the total amount of its liabilities (including, without
limitation, contingent liabilities); and
(ii) the present fair saleable value of its assets is
greater than its probable liability on its existing debts as
such debts become absolute and matured; and
(iii) it is then able and expects to be able to pay
its debts (including, without limitation, contingent debts
and other commitments) as they mature; and
(iv) it has capital sufficient to carry on its business
as conducted and as proposed to be conducted.
"Standby Letter of Credit" means any letter of credit
issued by an Issuing Bank pursuant to Section 3.01 for the
account of the Borrower or for the account of any of the
Borrower's Subsidiaries if the Borrower is jointly and
severally liable for reimbursement of amounts drawn under
such letter of credit, which is not a Commercial Letter of
Credit.
"Subsidiary" of a Person means any corporation, limited
liability company, general or limited partnership, or other
entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the
board of directors or other Persons performing similar
functions with respect to such entity are at the time
directly or indirectly owned or controlled by such Person,
one or more of the other subsidiaries of such Person or any
combination thereof. Notwithstanding the foregoing, for
purposes of this Agreement, Banner Aerospace, Inc. shall not
be included as a Subsidiary of the Borrower.
"Super-Majority Lenders" means Lenders whose Pro Rata
Shares, in the aggregate, are greater than sixty-seven
percent (67%); provided, however, that, in the event any of
the Lenders shall have failed to fund its Pro Rata Share of
any Revolving Loan requested by the Borrower which such
Lenders are obligated to fund under the terms of this
Agreement and any such failure has not been cured, then for
so long as such failure continues, "Super-Majority Lenders"
means Lenders (excluding all Lenders whose failure to fund
their respective Pro Rata Shares of such Revolving Loans
have not been so cured) whose Pro Rata Shares represent more
than sixty-seven percent (67%) of the aggregate Pro Rata
Shares of such Lenders.
"Tax Allocation Agreement" means that certain Eighth
Amended and Restated Tax Allocation Agreement dated as of
March 13, 1996 among TFC, RHI, Borrower and certain
Affiliates thereof, as in effect on the Closing Date.
"Taxes" is defined in Section 14.01(a).
"Term Lenders" means those Lenders having a Term Loan
Commitment; and "Term Lender" means one of the Term Lenders,
individually.
"Term Loan" is defined in Section 2.01(a).
"Term Loan Commitment" means, with respect to any
Lender, the obligation of such Lender to make its Term Loan
pursuant to the terms and conditions of this Agreement, in
an amount equal to the amount set forth under such Lender's
name under the heading "Term Loan Commitment" on the
signature pages hereof or the signature page of the
Assignment and Acceptance by which it became a Lender, as
modified from time to time pursuant to the terms of this
Agreement or to give effect to any applicable Assignment and
Acceptance, and "Term Loan Commitments" means the aggregate
principal amount of the Term Loan Commitments of all the
Lenders, the maximum amount of which shall be $30,000,000,
as reduced from time to time pursuant to Sections 2.01(d) or
4.01.
"Term Loan Pro Rata Share" means, with respect to any
Term Lender, the percentage obtained by dividing (i) the sum
of such Term Lender's Term Loan Commitment (in each case, as
adjusted from time to time in accordance with the provisions
of this Agreement or any Assignment and Acceptance to which
such Term Lender is a party) by (ii) the aggregate Term Loan
Commitments.
"Term Loan Termination Date" means the earlier of
(i) July 29, 1996 and (ii) the date of acceleration of the
Obligations pursuant to Section 12.02.
"Term Notes" means promissory notes executed by the
Borrower and delivered to the Lenders evidencing the Term
Loans, as the same may be amended, supplemented, modified or
restated from time to time, and any promissory not issued in
substitution therefor, substantially in the form attached
hereto as Exhibit C-2; and "Term Note" means any one of the
Term Notes.
"Termination Event" means (i) a Reportable Event with
respect to any Benefit Plan; (ii) the withdrawal of the
Borrower or any ERISA Affiliate from a Benefit Plan during a
plan year in which the Borrower or such ERISA Affiliate was
a "substantial employer" as defined in Section 4001(a)(2) of
ERISA or the cessation of operations which results in the
termination of employment of 20% of Benefit Plan
participants who are employees of the Borrower or any ERISA
Affiliate; (iii) the imposition of an obligation on the
Borrower or any ERISA Affiliate under Section 4041 of ERISA
to provide affected parties written notice of intent to
terminate a Benefit Plan in a distress termination described
in Section 4041(c) of ERISA; (iv) the institution by the
PBGC or any similar foreign Governmental Authority of
proceedings to terminate a Benefit Plan or a Foreign Pension
Plan; (v) any event or condition which could reasonably be
expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to
administer, any Benefit Plan; (vi) the appointment by a
foreign Governmental Authority of, or the institution of
proceedings by a foreign Governmental Authority to appoint,
a trustee to administer any Foreign Pension Plan; or (vii)
the partial or complete withdrawal of the Borrower or any
ERISA Affiliate from a Multiemployer Plan or a Foreign
Pension Plan.
"TFC" means The Fairchild Corporation, a Delaware
corporation.
"TFC/RHI Liquidity" means, as of any date of
determination thereof, an amount equal to (i) the amount of
consolidated Cash and Cash Equivalents of TFC and RHI as of
such date of determination, plus (ii) the amount of the
Revolving Credit Availability as of such date of
determination after giving effect to any requests for Loans
or Letters of Credit received by the Administrative Agent on
such date, minus (iii) the amount of Cash and Cash
Equivalents of TFC and RHI required to secure Contractual
Obligations of TFC and RHI as of such date of determination.
"Transaction Costs" means the fees, costs and expenses
payable by the Borrower in connection with the execution,
delivery and performance of the Loan Documents.
"Transfer Documents" means, collectively, all corporate
resolutions, agreements and instruments executed and
delivered in connection with the capitalization of the
Borrower and the transfer of assets of VSI to the Borrower;
"Transfer Document" means any one of the Transfer Documents.
"Uniform Commercial Code" means the Uniform Commercial
Code as enacted in the State of New York, as it may be
amended from time to time.
"VSI" means VSI Corporation, a Delaware corporation,
and transferor of all assets and liabilities of the Borrower
under the Transfer Documents.
"Wholly-Owned Subsidiary" means a corporation (i) one
hundred percent (100%) of the Capital Stock of which is
owned by the Borrower or any Subsidiary of the Borrower or
(ii) greater than ninety-eight percent (98%) of the Capital
Stock of which is owned by the Borrower or a Subsidiary of
the Borrower and the remainder of which Capital Stock is
owned by a nominee of the Borrower or such Subsidiary solely
to comply with the Requirements of Law of the jurisdiction
governing such corporation's organization and existence.
1.02. Computation of Time Periods. In this Agreement,
in the computation of periods of time from a specified date
to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but
excluding". Periods of days referred to in this Agreement
shall be counted in calendar days unless Business Days are
expressly prescribed. Any period determined hereunder by
reference to a month or months or year or years shall end on
the day in the relevant calendar month in the relevant year,
if applicable, immediately preceding the date numerically
corresponding to the first day of such period; provided that
if such period commences on the last day of a calendar month
(or on a day for which there is no numerically corresponding
day in the calendar month during which such period is to
end), such period shall, unless otherwise expressly required
by the other provisions of this Agreement, end on the last
day of the calendar month.
1.03. Accounting Terms. Subject to Section 15.04, for
purposes of this Agreement, all accounting terms not
otherwise defined herein shall have the meanings assigned to
them in conformity with GAAP.
1.04. Other Terms. All other terms contained in this
Agreement shall, unless the context indicates otherwise,
have the meanings assigned to such terms by the Uniform
Commercial Code to the extent the same are defined therein.
ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Term Loans. (a) Amount of Term Loans. Subject
to the terms and conditions set forth in this Agreement,
each Lender on the Closing Date hereby severally and not
jointly agrees to make on the Closing Date, a term loan, in
Dollars, to the Borrower in an amount equal to such Lender's
Term Loan Commitment (each individually, a "Term Loan" and,
collectively, the "Term Loans"). All Term Loans shall be
made by the Lenders on the Closing Date simultaneously and
proportionately to their respective Pro Rata Shares, it
being understood that no Lender shall be responsible for any
failure by any other Lender to perform its obligation to
make any Term Loan hereunder nor shall the Term Loan
Commitment of any Lender be increased or decreased as a
result of any such failure.
(b) Notice of Borrowing. The Borrower shall deliver
to the Administrative Agent a Notice of Borrowing with
respect to the Term Loans, signed by it, on the Closing
Date. Such Notice of Borrowing shall specify (i) the aggre-
gate amount of the Term Loans and (ii) instructions for the
disbursement of the proceeds of the Term Loans. The Term
Loans shall initially be Base Rate Loans and thereafter may
be continued as Base Rate Loans or converted into Eurodollar
Rate Loans in the manner provided in Section 5.01(c) and
subject to the conditions and limitations therein set forth
and set forth in Section 5.02. Any Notice of Borrowing
given pursuant to this Section 2.01(b) shall be irrevocable.
(c) Making of Term Loans. Promptly after receipt of
the Notice of Borrowing under Section 2.01(b) in respect of
the Term Loans, the Administrative Agent shall notify each
Lender by facsimile transmission, or other similar form of
transmission, of the proposed Borrowing. Each Lender shall
deposit an amount equal to its Pro Rata Share of the Term
Loans with the Administrative Agent at its office in New
York, New York, in immediately available funds, on the
Closing Date. Subject to the fulfillment of the conditions
precedent set forth in Section 6.01, the Administrative
Agent shall make the proceeds of such amounts received by it
available to the Borrower at the Administrative Agent's
office in New York, New York on the Closing Date and shall
disburse such proceeds in accordance with the Borrower's
disbursement instructions set forth in such Notice of
Borrowing. The failure of any Lender to deposit the amount
described above with the Administrative Agent on the Closing
Date shall not relieve any other Lender of its obligations
hereunder to make its Term Loan on the Closing Date. In the
event the conditions precedent set forth in Section 6.01 are
not fulfilled or duly waived as of the Closing Date, the
Administrative Agent shall promptly return, by wire transfer
of immediately available funds, the amount deposited by each
Lender to such Lender.
(d) Repayment of the Term Loans. (i) The Term Loans
shall be repayable on July 29, 1996, unless the Term Loan
Termination Date earlier occurs, and the Term Loan
Commitments shall be permanently reduced by the amount of
each installment on the date payment thereof is required to
be made hereunder.
(ii) The Borrower may make voluntary prepayments as
and when described in Section 4.01(a)(i) and shall make the
mandatory prepayments required in Section 4.01(b), for
credit against the Term Loans pursuant to the provisions of
Section 4.01(a)(ii) or Section 4.01(b)(vi), as applicable.
2.02. Revolving Credit Facility. (a) Availability.
Subject to the terms and conditions set forth in this
Agreement, each Lender hereby severally and not jointly
agrees to make revolving loans, in Dollars (each
individually, a "Revolving Loan" and, collectively, the
"Revolving Loans") to the Borrower from time to time during
the period from the Closing Date to the Business Day next
preceding the Revolving Credit Termination Date, in an
amount not to exceed such Lender's Pro Rata Share of the
Revolving Credit Availability at such time. All Revolving
Loans comprising the same Borrowing under this Agreement
shall be made by the Lenders simultaneously and
proportionately to their then respective Pro Rata Shares, it
being understood that no Lender shall be responsible for any
failure by any other Lender to perform its obligation to
make a Revolving Loan hereunder nor shall the Revolving
Credit Commitment of any Lender be increased or decreased as
a result of any such failure. Subject to the provisions of
this Agreement, the Borrower may repay any outstanding
Revolving Loan on any day which is a Business Day and any
amounts so repaid may be reborrowed, up to the amount
available under this Section 2.02(a) at the time of such
Borrowing, until the Business Day next preceding the
Revolving Credit Termination Date; provided, however, the
Borrower shall, without notice or demand of any kind,
immediately make such repayments of the Revolving Loans to
the extent necessary to reduce the aggregate outstanding
principal amount of the Revolving Loans to an amount less
than or equal to the difference between the then Revolving
Credit Availability and the Letter of Credit Obligations as
of such time. Each requested Borrowing of Revolving Loans
funded on any Funding Date for Revolving Loans shall be
(i) if Base Rate Loans, in a principal amount of at least
$100,000 and in integral multiples of $100,000 in excess of
that amount and (ii) if Eurodollar Rate Loans, in a
principal amount of at least $1,000,000 and in integral
multiples of $100,000 in excess of that amount.
(b) Notice of Borrowing. When the Borrower desires to
borrow under this Section 2.02, it shall deliver to the
Administrative Agent a Notice of Borrowing, signed by it,
(i) on the Closing Date, in the case of a Borrowing of
Revolving Loans on the Closing Date and (ii) no later than
11:00 a.m. (New York time) on the proposed Funding Date
therefor, in the case of a Borrowing of Base Rate Loans
after the Closing Date and (iii) no later than 12:00 noon
(New York time) at least two (2) Business Days in advance of
the proposed Funding Date therefor, in the case of a
Borrowing of Eurodollar Rate Loans after the Closing Date.
Such Notice of Borrowing shall specify (i) the proposed
Funding Date (which shall be a Business Day), (ii) the
amount of the proposed Borrowing, (iii) the Revolving Credit
Availability as of the date of such Notice of Borrowing,
(iv) whether the proposed Borrowing will be of Base Rate
Loans or Eurodollar Rate Loans, (v) in the case of
Eurodollar Rate Loans, the requested Eurodollar Interest
Period, (vi) instructions for the disbursement of the
proceeds of the proposed Borrowing, and (vii) the portion of
the proposed Borrowing, if any, which will be used to pay a
dividend on Borrower's Capital Stock. The Revolving Loans
made on the Closing Date shall initially be Base Rate Loans
and thereafter may be continued as Base Rate Loans or
converted into Eurodollar Rate Loans, in the manner provided
in Section 5.01(c) and subject to the conditions therein set
forth and in Section 5.02. In lieu of delivering such a
Notice of Borrowing (except with respect to a Borrowing of
Revolving Loans on the Closing Date), the Borrower may give
the Administrative Agent telephonic notice of any proposed
Borrowing by the time required under this Section 2.02(b),
if the Borrower confirms such notice by delivery of the
required Notice of Borrowing to the Administrative Agent by
facsimile transmission promptly, but in no event later than
5:00 p.m. (New York time) on the same day, the original of
which facsimile copy shall be delivered to the
Administrative Agent within three (3) days after the date of
such transmission. Any Notice of Borrowing (or telephonic
notice in lieu thereof) given pursuant to this Section
2.02(b) shall be irrevocable.
(c) Making of Revolving Loans. (i) Promptly after
receipt of a Notice of Borrowing under Section 2.02(b) (or
telephonic notice in lieu thereof), the Administrative Agent
shall notify each Revolving Lender by telex or telecopy, or
other similar form of transmission, of the proposed
Borrowing. Each Revolving Lender shall deposit an amount
equal to its Pro Rata Share of the amount requested by the
Borrower to be made as Revolving Loans with the
Administrative Agent at its office in New York, New York, in
immediately available funds, (A) on the Closing Date with
respect to the Borrowing of Revolving Loans on such date
specified in the initial Notice of Borrowing and (B) not
later than 1:00 p.m. (New York time) on any other Funding
Date for Revolving Loans. Subject to the fulfillment of the
conditions precedent set forth in Section 6.01 or Section
6.02, as applicable, the Administrative Agent shall make the
proceeds of such amounts received by it available to the
Borrower at the Administrative Agent's office in New York,
New York on such Funding Date (or on the date received if
later than such Funding Date) and shall disburse such
proceeds in accordance with the Borrower's disbursement
instructions set forth in the applicable Notice of Borrow-
ing. The failure of any Revolving Lender to deposit the
amount described above with the Administrative Agent on the
applicable Funding Date shall not relieve any other
Revolving Lender of its obligations hereunder to make its
Revolving Loan on such Funding Date. In the event the
conditions precedent set forth in Section 6.01 or 6.02, as
applicable, are not fulfilled as of the proposed Funding
Date for any Borrowing, the Administrative Agent shall
promptly return, by wire transfer of immediately available
funds, the amount deposited by each Revolving Lender to such
Lender.
(ii) Unless the Administrative Agent shall have been
notified by any Revolving Lender (A) on the Business Day
immediately preceding the applicable Funding Date in respect
of any Borrowing of Revolving Loans which are Eurodollar
Rate Loans or (B) prior to the time of funding thereof as
specified in Section 2.02(c) in respect of any Borrowing of
Revolving Loans which are Base Rate Loans, that such Lender
does not intend to fund its Revolving Loan requested to be
made on such Funding Date, the Administrative Agent may
assume that such Lender has funded its Revolving Loan and is
depositing the proceeds thereof with the Administrative
Agent on the Funding Date therefor, and the Administrative
Agent in its sole discretion may, but shall not be obligated
to, disburse a corresponding amount to the Borrower on the
applicable Funding Date. If the Revolving Loan proceeds
corresponding to that amount are advanced to the Borrower by
the Administrative Agent but are not in fact deposited with
the Administrative Agent by such Revolving Lender on or
prior to the applicable Funding Date, such Lender agrees to
pay, and in addition the Borrower agrees to repay, to the
Administrative Agent forthwith on demand such corresponding
amount, together with interest thereon, for each day from
the date such amount is disbursed to or for the benefit of
the Borrower until the date such amount is paid or repaid to
the Administrative Agent, (1) in the case of the Borrower,
at the interest rate applicable to such Borrowing and (2) in
the case of such Revolving Lender, at the Federal Funds Rate
for the first three (3) Business Days, and thereafter at the
interest rate applicable to such Borrowing. If such
Revolving Lender shall pay to the Administrative Agent the
corresponding amount, the amount so paid shall constitute
such Lender's Revolving Loan, and if both such Lender and
the Borrower shall pay and repay such corresponding amount,
the Administrative Agent shall promptly pay to the Borrower
such corresponding amount. This Section 2.02(c)(ii) does
not relieve any Revolving Lender of its obligation to make
its Revolving Loan on any applicable Funding Date.
(d) Revolving Credit Termination Date. The Revolving
Credit Commitments shall terminate on the Revolving Credit
Termination Date. Each Revolving Lender's obligation to make
Revolving Loans shall terminate on the Business Day next
preceding the Revolving Credit Termination Date. All
outstanding Revolving Credit Obligations shall be paid in
full (or, in the case of unmatured Letter of Credit Obliga-
tions, provision for payment in cash shall be made to the
satisfaction of the Issuing Banks and the Requisite Lenders)
(i) if the Revolving Credit Commitments are terminated
pursuant to Section 4.01, on the date such termination is
effective, and (ii) otherwise, on the earlier to occur of
(A) July 29, 1996 or, if not a Business Day, the next
preceding Business Day, and (B) the date of acceleration of
the Obligations pursuant to Section 12.02.
(e) Maximum Revolving Credit Facility.
Notwithstanding anything in this Agreement to the contrary,
in no event shall the aggregate principal Revolving Credit
Obligations exceed the Revolving Credit Commitments as in
effect from time to time.
2.03. Authorized Officers and Administrative
Agents. On the Closing Date the Borrower shall deliver, and
from time to time thereafter the Borrower may deliver, to
the Administrative Agent an Officer's Certificate setting
forth the names of the officers, employees and agents
authorized to request Loans and Letters of Credit and to
request a conversion/continuation of any Loan, in each
instance containing a specimen signature of each such
officer, employee or Administrative Agent. The officers,
employees and agents so authorized shall also be authorized
to act for the Borrower in respect of all other matters
relating to the Loan Documents. The Administrative Agent,
Lenders and Issuing Banks shall be entitled to rely
conclusively on such officer's, employee's, or agent's
authority to request such Loan or Letter of Credit or such
conversion/continuation until the Administrative Agent,
Lenders and Issuing Banks receive written notice to the
contrary. None of the Administrative Agent, the Lenders, or
the Issuing Banks shall have any duty to verify the
authenticity of the signature appearing on any such
Officer's Certificate, written Notice of Borrowing or Notice
of Conversion/Continuation, or any other document, and, with
respect to an oral request for such a Loan or Letter of
Credit or such conversion/continuation, the Administrative
Agent shall have no duty to verify the identity of any
person representing himself or herself as one of the
officers, employees or agents authorized to make such
request or otherwise to act on behalf of the Borrower. None
of the Administrative Agent, any Lender or any Issuing Bank
shall incur any liability to the Borrower or any other
Person in acting upon any telephonic or facsimile notice
referred to above which the Administrative Agent, such
Lender, or such Issuing Bank believes to have been given by
a duly authorized officer or other person authorized to
borrow on behalf of the Borrower.
2.04. Use of Proceeds of Loans. The proceeds of the
Loans made on the Closing Date shall be used to repay in
full the Refinanced Indebtedness and the Transactions Costs,
as well as for the purposes described in the following
sentence. The proceeds of all other Loans shall be used for
working capital in the ordinary course of the respective
businesses of the Borrower and its Subsidiaries or for other
lawful general corporate purposes.
ARTICLE III
LETTERS OF CREDIT
3.01. Letters of Credit. Subject to the terms and
conditions set forth in this Agreement, each Issuing Bank
hereby severally agrees to issue for the account of the
Borrower, or for the account of any of the Borrower's
Subsidiaries if the Borrower is jointly and severally liable
for reimbursement of amounts drawn under such Letter of
Credit, one or more Letters of Credit, subject to the
following provisions:
(a)Types and Amounts. An Issuing Bank shall not have
any obligation to issue, amend or extend, and shall not
issue, amend or extend, any Letter of Credit at any time:
(i) if the aggregate Letter of Credit Obligations with
respect to such Issuing Bank, after giving effect to the
issuance, amendment or extension of the Letter of Credit
requested hereunder, shall exceed any limit imposed by law
or regulation upon such Issuing Bank;
(ii) if the Issuing Bank receives written notice from
the Administrative Agent at or before 11:00 a.m. (New York
time) on the date of the proposed issuance, amendment or
extension of such Letter of Credit that (A) immediately
after giving effect to the issuance, amendment or extension
of such Letter of Credit, (I) the Letter of Credit
Obligations at such time would exceed $9,000,000, or
(II) the Revolving Credit Obligations at such time would
exceed the Revolving Credit Commitments in effect at such
time, or (B) one or more of the conditions precedent con-
tained in Sections 6.01 or 6.02, as applicable, would not on
such date be satisfied, unless such conditions are
thereafter satisfied and written notice of such satisfaction
is given to the Issuing Bank by the Administrative Agent
(and an Issuing Bank shall not otherwise be required to
determine that, or take notice whether, the conditions
precedent set forth in Sections 6.01 or 6.02, as applicable,
have been satisfied);
(iii) which is in a currency other than Dollars; or
(iv) which has an expiration date later than the date
one (1) year after the date of issuance (without regard to
any automatic renewal provisions thereof); provided,
however, that (A) the Letter(s) of Credit identified on
Schedule 3.01-A attached hereto are permitted to have the
expiry dates set forth on Schedule 3.01-A and (B) on the
Revolving Credit Termination Date, Borrower shall deposit
with the Administrative Agent (or respective Issuing Bank(s)
at the direction of the Administrative Agent) Cash
Collateral for deposit in the Cash Collateral Account or
under other agreements satisfactory to the Administrative
Agent and Issuing Bank(s) and in an amount equal to the
then undrawn face amount of all Letters of Credit which will
continue outstanding after the Revolving Credit Termination
Date plus Letter of Credit Fees with respect to such Letters
of Credit for the period commencing on the Revolving Credit
Termination Date through the expiry date of such Letters of
Credit.
(b) Conditions. In addition to being subject to the
satisfaction of the conditions precedent contained in
Sections 6.01 and 6.02, as applicable, the obligation of an
Issuing Bank to issue, amend or extend any Letter of Credit
is subject to the satisfaction in full of the following
conditions:
(i) if the Issuing Bank so requests, the Borrower or,
in the case of Letters of Credit issued for the account of
any of the Borrower's Subsidiaries, the Borrower and such
Subsidiary shall have executed and delivered to such Issuing
Bank and the Administrative Agent a Letter of Credit
Reimbursement Agreement and such other documents and
materials as may be required pursuant to the terms thereof;
and
(ii) the terms of the proposed Letter of Credit shall
be satisfactory to the Issuing Bank in its sole discretion.
(c) Issuance of Letters of Credit. (i) The Borrower
shall give an Issuing Bank and the Administrative Agent
written notice that it has selected such Issuing Bank to
issue a Letter of Credit not later than 11:00 a.m. (New York
time) on the third (3rd) Business Day preceding the
requested date for issuance thereof under this Agreement, or
such shorter notice as may be acceptable to such Issuing
Bank and the Administrative Agent. Such notice shall be
irrevocable unless and until such request is denied by the
applicable Issuing Bank and shall specify (A) that the
requested Letter of Credit is either a Commercial Letter of
Credit or a Standby Letter of Credit, (B) that such Letter
of Credit is solely for the account of the Borrower or the
name of the Subsidiary of the Borrower which is jointly and
severally applying for such Letter of Credit, (C) the stated
amount of the Letter of Credit requested, (D) the effective
date (which shall be a Business Day) of issuance of such
Letter of Credit, (E) the date on which such Letter of
Credit is to expire (which shall be a Business Day and no
later than the Business Day immediately preceding the
scheduled Revolving Credit Termination Date), (F) the Person
for whose benefit such Letter of Credit is to be issued, (G)
other relevant terms of such Letter of Credit, (H) the
Revolving Credit Availability at such time, and (I) the
amount of the then outstanding Letter of Credit Obligations.
Such Issuing Bank shall notify the Administrative Agent
immediately upon receipt of a written notice from the
Borrower requesting that a Letter of Credit be issued, or
that an existing Letter of Credit be extended or amended
and, upon the Administrative Agent's request therefor, send
a copy of such notice to the Administrative Agent.
(ii) The Issuing Bank shall give (A) the
Administrative Agent written notice, or telephonic notice
confirmed promptly thereafter in writing, of the issuance,
amendment or extension of a Letter of Credit and (B)
promptly after issuance thereof, provide the Administrative
Agent with a copy of each Letter of Credit issued and each
amendment thereto.
(d) Reimbursement Obligations; Duties of Issuing
Banks. (i) Notwithstanding any provisions to the contrary
in any Letter of Credit Reimbursement Agreement:
(A) the Borrower shall reimburse, or cause its
Subsidiary for whose account a Letter of Credit is issued to
reimburse, the Issuing Bank for amounts drawn under such
Letter of Credit, in Dollars, no later than the date (the
"Reimbursement Date") which is the earlier of (I) the time
specified in the applicable Letter of Credit Reimbursement
Agreement and (II) one (1) Business Day after the Borrower
receives written notice from the Issuing Bank that payment
has been made under such Letter of Credit by the Issuing
Bank; and
(B) all Reimbursement Obligations with respect to any
Letter of Credit shall bear interest at the rate applicable
to Base Rate Loans in accordance with Section 5.01(a) from
the date of the relevant drawing under such Letter of Credit
until the Reimbursement Date and thereafter at the rate
applicable to Base Rate Loans in accordance with Section
5.01(d).
(ii) The Issuing Bank shall give the Administrative
Agent written notice, or telephonic notice confirmed
promptly thereafter in writing, of all drawings under a
Letter of Credit and the payment (or the failure to pay when
due) by the Borrower or its applicable Subsidiary on account
of a Reimbursement Obligation (which notice the
Administrative Agent shall promptly transmit by telegram,
telex, telecopy or similar transmission to each Lender).
(iii) No action taken or omitted in good faith by an
Issuing Bank under or in connection with any Letter of
Credit shall put such Issuing Bank under any resulting
liability to any Lender, the Borrower or any of its
Subsidiaries or, so long as it is not issued in violation of
Section 3.01(a), relieve any Lender of its obligations
hereunder to such Issuing Bank. Solely as between the
Issuing Banks and the Lenders, in determining whether to pay
under any Letter of Credit, the respective Issuing Bank
shall have no obligation to the Lenders other than to
confirm that any documents required to be delivered under a
respective Letter of Credit appear to have been delivered
and that they appear on their face to comply with the
requirements of such Letter of Credit.
(e) Participations. (i) Immediately upon issuance by
an Issuing Bank of any Letter of Credit in accordance with
the procedures set forth in this Section 3.01 and immedi-
ately upon conversion of a letter of credit of an Issuing
Bank to a Letter of Credit pursuant to Section 3.02, each
Revolving Lender shall be deemed to have irrevocably and
unconditionally purchased and received from that Issuing
Bank, without recourse or warranty, an undivided interest
and participation in such Letter of Credit to the extent of
such Lender's Revolving Credit Pro Rata Share, including,
without limitation, all obligations of the Borrower with
respect thereto (other than amounts owing to the Issuing
Bank under Section 3.01(g)) and any security therefor and
guaranty pertaining thereto.
(ii) If any Issuing Bank makes any payment under any
Letter of Credit and the Borrower or the Subsidiary of the
Borrower for whose account the Letter of Credit was issued
does not repay such amount to the Issuing Bank on the
Reimbursement Date, the Issuing Bank shall promptly notify
the Administrative Agent, which shall promptly notify each
Revolving Lender, and each Revolving Lender shall promptly
and unconditionally pay to the Administrative Agent for the
account of such Issuing Bank, in immediately available
funds, the amount of such Lender's Revolving Credit Pro Rata
Share of such payment (net of that portion of such payment,
if any, made by such Lender in its capacity as an Issuing
Bank), and the Administrative Agent shall promptly pay to
the Issuing Bank such amounts received by it, and any other
amounts received by the Administrative Agent for the Issuing
Bank's account, pursuant to this Section 3.01(e). All
amounts so paid to the Issuing Bank shall be deemed to
constitute Revolving Loans. If a Lender does not make its
Revolving Credit Pro Rata Share of the amount of such
payment available to the Administrative Agent, such Lender
agrees to pay to the Administrative Agent for the account of
the Issuing Bank, forthwith on demand, such amount together
with interest thereon, for the first three (3) Business Days
after the date such payment was first due at the Federal
Funds Rate, and thereafter at the interest rate then
applicable to Base Rate Loans in accordance with
Section 5.01(a). The failure of any Lender to make
available to the Administrative Agent for the account of an
Issuing Bank its Pro Rata Share of any such payment shall
neither relieve any other Lender of its obligation hereunder
to make available to the Administrative Agent for the
account of such Issuing Bank such other Lender's Revolving
Credit Pro Rata Share of any payment on the date such
payment is to be made nor increase the obligation of any
other Lender to make such payment to the Administrative
Agent.
(iii) Whenever an Issuing Bank receives a payment on
account of a Reimbursement Obligation, including any
interest thereon, as to which the Administrative Agent has
previously received payments from any Lender for the account
of such Issuing Bank pursuant to this Section 3.01(e), such
Issuing Bank shall promptly pay to the Administrative Agent
and the Administrative Agent shall promptly pay to such
Lender an amount equal to such Lender's Revolving Credit Pro
Rata Share thereof. Each such payment shall be made by such
Issuing Bank or the Administrative Agent, as the case may
be, on the Business Day on which such Person receives the
funds paid to such Person pursuant to the preceding
sentence, if received prior to 11:00 a.m. (New York time) on
such Business Day, and otherwise on the next succeeding
Business Day.
(iv) Upon the request of any Lender, an Issuing Bank
shall furnish such Lender copies of any Letter of Credit or
Letter of Credit Reimbursement Agreement to which such
Issuing Bank is party and such other documentation as
reasonably may be requested by such Lender.
(v) The obligations of a Lender to make payments to
the Administrative Agent for the account of any Issuing Bank
with respect to a Letter of Credit shall be irrevocable,
shall not be subject to any qualification or exception
whatsoever except willful misconduct or gross negligence of
such Issuing Bank, and shall be honored in accordance with
this Article III (irrespective of the satisfaction of the
conditions described in Sections 6.01 and 6.02, as
applicable) under all circumstances, including, without
limitation, any of the following circumstances:
(A) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(B) the existence of any claim, setoff, defense or
other right which the Borrower may have at any time against
a beneficiary named in a Letter of Credit or any transferee
of a beneficiary named in a Letter of Credit (or any Person
for whom any such transferee may be acting), the
Administrative Agent, the Issuing Bank, any Lender, or any
other Person, whether in connection with this Agreement, any
Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying trans-
actions between the account party and beneficiary named in
any Letter of Credit);
(C) any draft, certificate or any other document
presented under the Letter of Credit having been determined
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;
(E) any failure by that Issuing Bank to make any
reports required pursuant to Section 3.01(h) or the
inaccuracy of any such report; or
(F) the occurrence of any Event of Default or
Potential Event of Default.
(f) Payment of Reimbursement Obligations. (i) The
Borrower unconditionally agrees to pay, or cause its
Subsidiary for whose account a Letter of Credit is issued to
pay, to each Issuing Bank, in Dollars, the amount of all
Reimbursement Obligations, interest and other amounts
payable to such Issuing Bank under or in connection with the
Letters of Credit when such amounts are due and payable,
irrespective of any claim, setoff, defense or other right
which the Borrower may have at any time against any Issuing
Bank or any other Person.
(ii) In the event any payment by the Borrower or such
Subsidiary received by an Issuing Bank with respect to a
Letter of Credit and distributed by the Administrative Agent
to the Revolving Lenders on account of their participations
is thereafter set aside, avoided or recovered from such
Issuing Bank in connection with any receivership, liquida-
tion or bankruptcy proceeding, each such Lender which
received such distribution shall, upon demand by such Issu-
ing Bank, contribute such Lender's Revolving Credit Pro Rata
Share of the amount set aside, avoided or recovered together
with interest at the rate required to be paid by such
Issuing Bank upon the amount required to be repaid by it.
(g) Issuing Bank Charges. The Borrower shall pay, or
cause its Subsidiary for whose account a Letter of Credit is
issued to pay, to each Issuing Bank, solely for its own
account, the standard charges assessed by such Issuing Bank
in connection with the issuance, administration, amendment
and payment or cancellation of Letters of Credit and such
compensation in respect of such Letters of Credit for the
Borrower's or such Subsidiary's account, as applicable, as
may be agreed upon by the Borrower and such Issuing Bank
from time to time.
(h) Issuing Bank Reporting Requirements. Each Issuing
Bank shall, no later than the tenth (10th) Business Day
following the last day of each calendar month, provide to
the Administrative Agent, the Borrower, and each Lender
separate schedules for Commercial Letters of Credit and
Standby Letters of Credit issued as Letters of Credit, in
form and substance reasonably satisfactory to the
Administrative Agent, setting forth the aggregate Letter of
Credit Obligations outstanding to it at the end of each
month and, to the extent not otherwise provided in
accordance with the provisions of Section 3.01(c)(ii), any
information requested by the Administrative Agent or the
Borrower relating to the date of issue, account party,
amount, expiration date and reference number of each Letter
of Credit issued by it.
(i) Indemnification; Exoneration. (i) In addition to
all other amounts payable to an Issuing Bank, the Borrower
hereby agrees to defend, indemnify, and save the
Administrative Agent, each Issuing Bank and each Lender
harmless from and against any and all claims, demands,
liabilities, penalties, damages, losses (other than loss of
profits), costs, charges and expenses (including reasonable
attorneys' fees but excluding taxes) which the
Administrative Agent, such Issuing Bank or such Lender may
incur or be subject to as a consequence, direct or indirect,
of (A) the issuance of any Letter of Credit other than as a
result of the gross negligence or willful misconduct of the
Issuing Bank, as determined by a court of competent
jurisdiction, or (B) the failure of the Issuing Bank issuing
a Letter of Credit to honor a drawing under such Letter of
Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto
government or Governmental Authority.
(ii) As between the Borrower and any of its Subsidi-
aries for whose account a Letter of Credit is issued on the
one hand and the Administrative Agent, the Lenders and the
Issuing Banks on the other hand, the Borrower assumes all
risks of the acts and omissions of, or misuse of Letters of
Credit by, the respective beneficiaries of the Letters of
Credit. In furtherance and not in limitation of the
foregoing, subject to the provisions of the Letter of Credit
Reimbursement Agreements, the Issuing Banks and the Lenders
shall not be responsible for: (A) the form, validity,
legality, sufficiency, accuracy, genuineness or legal effect
of any document submitted by any party in connection with
the application for and issuance of the Letters of Credit,
even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (B)
the validity, legality or sufficiency of any instrument
transferring or assigning or purporting to transfer or
assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (C)
failure of the beneficiary of a Letter of Credit to comply
duly with conditions required in order to draw upon such
Letter of Credit; (D) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, whether or not they be
in cipher; (E) errors in interpretation of technical terms;
(F) any loss or delay in the transmission or otherwise of
any document required in order to make a drawing under any
Letter of Credit or of the proceeds thereof; (G) the mis-
application by the beneficiary of a Letter of Credit of the
proceeds of any drawing under such Letter of Credit; and (H)
any consequences arising from causes beyond the control of
the Administrative Agent, the Issuing Banks or the Lenders.
3.02 Transitional Provisions. Schedule 3.02 contains
a schedule of certain letters of credit issued prior to the
Closing Date by Citibank or Union Bank for the account of
VSI, the Borrower's predecessor in interest, on which the
Borrower has become liable for reimbursement of amounts
drawn thereunder, or for the account of a Subsidiary of the
Borrower and on which the Borrower is jointly and severally
liable for reimbursement of amounts drawn thereunder.
Subject to the satisfaction of the conditions precedent
contained in Section 6.01 on the Closing Date (i) such
letters of credit, to the extent still outstanding, shall
automatically and without further action of the parties
thereto be converted into Letters of Credit issued pursuant
to this Section 3.02 and subject to the provisions hereof,
and for this purpose the fees specified in Section 5.03(b)
shall be payable as if such letters of credit had been
issued on the Closing Date, (ii) the face amount of such
letters of credit shall be included in the calculation of
Letter of Credit Obligations, and (iii) all liabilities of
the Borrower with respect to such letters of credit shall
constitute Obligations. No letter of credit converted in
accordance with this Section 3.02 shall be amended, extended
or renewed without the prior written consent of the
Administrative Agent.
3.03 Obligations Several. The obligations of each
Issuing Bank and each Revolving Lender under this Article
III are several and not joint, and no Issuing Bank or Lender
shall be responsible for the obligation to issue Letters of
Credit or participation obligation hereunder, respectively,
of any other Issuing Bank or Lender.
ARTICLE IV
PAYMENTS AND PREPAYMENTS
4.01. Prepayments; Reductions in Commitments.
(a) Voluntary Prepayments/Reductions. (i) Notice.
The Borrower may, upon at least three (3) Business Days'
prior written notice to the Administrative Agent (which the
Administrative Agent shall promptly transmit to each
Lender), at any time and from time to time, prepay the Term
Loans which are Base Rate Loans, in whole or in part. Term
Loans which are Eurodollar Rate Loans may be prepaid in
whole or in part upon at least five (5) Business Days' prior
written notice to the Administrative Agent (which the
Administrative Agent shall promptly transmit to each
Lender), (A) on the expiration date of the then applicable
Eurodollar Interest Period therefor, and (B) on any other
date upon payment of the amounts described in Article XIV as
referenced in Section 4.01(a)(iv) below. Any notice of
prepayment given to the Administrative Agent under this Sec-
tion 4.01(a)(i) shall specify the date (which shall be a
Business Day) of prepayment, the aggregate principal amount
of the prepayment and any allocation of such amount among
Base Rate Loans and Eurodollar Rate Loans. When notice of
prepayment is delivered as provided herein, the principal
amount of the Term Loans specified in the notice shall
become due and payable on the prepayment date specified in
such notice. The Borrower may repay Revolving Loans, without
prior written notice to the Administrative Agent or any
Lender, at any time and from time to time.
(ii) Amount; Application; Term Loan Commitment
Reduction. Unless the aggregate outstanding principal
balance of the Term Loans is to be prepaid in full,
voluntary prepayments of the Term Loans shall be in an
aggregate minimum amount of $1,000,000 and integral
multiples of $1,000,000 in excess of that amount. Each
voluntary prepayment of the Term Loans shall be applied to
the Term Loans, ratably, and shall be allocated first to
Term Loans which are Base Rate Loans until paid in full and
then to Term Loans which are Eurodollar Rate Loans, and
shall permanently reduce the Term Loan Commitment of each
Lender proportionately in accordance with its Pro Rata
Share.
(iii) Voluntary Revolving Credit Commitment
Reductions. The Borrower, upon at least three (3) Business
Days' prior written notice to the Administrative Agent
(which the Administrative Agent shall promptly transmit to
each Lender), shall have the right, at any time and from
time to time, to terminate in whole or permanently reduce in
part the Revolving Credit Commitments; provided that the
Borrower shall have made whatever payment may be required to
reduce the Revolving Credit Obligations to an amount less
than or equal to the Revolving Credit Commitments as reduced
or terminated. Any partial reduction of the Revolving
Credit Commitments shall be in an aggregate minimum amount
of $1,000,000 and integral multiples of $1,000,000 in excess
of that amount, and shall reduce the Revolving Credit
Commitment of each Lender proportionately in accordance with
its Pro Rata Share. Any notice of termination or reduction
given to the Administrative Agent under this Sec-
tion 4.01(a)(iii) shall specify the date (which shall be a
Business Day) of such termination or reduction and, with
respect to a partial reduction, the aggregate principal
amount thereof. When notice of termination or reduction is
delivered as provided herein, the principal amount of the
Revolving Loans specified in the notice shall become due and
payable on the date specified in such notice.
(iv) Prepayment Fee. The prepayments and payments in
respect of reductions and terminations described in this
Section 4.01 may be made without premium or penalty (except
as provided in Article XIV).
(b) Mandatory Prepayments/Reductions.
(i) Net Cash Proceeds of Sale. Within three (3)
Business Days after the Borrower's or any of its
Subsidiaries' receipt of any Net Cash Proceeds of Sale in
excess of $100,000, the Borrower shall make or cause to be
made a mandatory prepayment of the Obligations in an amount
equal to one hundred percent (100%) of such Net Cash Pro-
ceeds of Sale.
(ii) Net Cash Proceeds of Issuance of Equity
Securities. Immediately upon the Borrower's or any of its
Subsidiaries' receipt of any Net Cash Proceeds of Issuance
of Equity Securities, the Borrower shall make or cause to be
made a mandatory prepayment in an amount equal to one
hundred percent (100%) of such Net Cash Proceeds of Issuance
of Equity Securities.
(iii) Net Cash Proceeds of Issuance of Indebtedness.
Immediately upon the Borrower's or any of its Subsidiaries'
receipt of any Net Cash Proceeds of Issuance of
Indebtedness, the Borrower shall make or cause to be made a
mandatory prepayment in an amount equal to one hundred
percent (100%) of such Net Cash Proceeds of Issuance of
Indebtedness.
(iv) No Waiver or Consent. Nothing in this
Section 4.01(b) shall be construed to constitute the
Lenders' consent to any transaction referenced in clauses
(i) and (iii) above which is not expressly permitted by
Article X.
(v) Notice. The Borrower shall give the
Administrative Agent prior written notice or telephonic
notice promptly confirmed in writing (each of which the
Administrative Agent shall promptly transmit to each
Lender), when a Designated Prepayment will be made (which
date of prepayment shall be no later than the date on which
such Designated Payment becomes due and payable pursuant to
this Section 4.01(b)).
(vi) Application of Designated Prepayments.
Designated Prepayments shall be allocated and applied to the
Obligations as follows:
(A) the amount of each Designated Prepayment shall be
applied to the principal balance of the Term Loans ratably
to all the Term Loans based on the relative outstanding
principal balances thereof as of the date of application,
with each application being made first to the Loans which
are Base Rate Loans until paid in full and then to Loans
which are Eurodollar Rate Loans and shall permanently reduce
the Term Loan Commitment of each Term Lender proportionately
in accordance with its Term Loan Pro Rata Share;
(B) following the payment in full of the Term Loans,
the remaining balance of each Designated Prepayment shall be
applied to the outstanding principal balance of the
Revolving Loans and shall permanently reduce the Revolving
Credit Commitment of each Revolving Lender proportionately
in accordance with its Revolving Credit Pro Rata Share; and
(C) following the payment in full of the Revolving Loans,
the remaining balance of each Designated Prepayment shall be
applied to the principal balance of the Letter of Credit
Obligations (or, to the extent such Letter of Credit
Obligations are contingent, deposited in the Cash Collateral
Account to provide Cash Collateral in respect of such Letter
of Credit Obligations).
4.02. Payments. (a) Manner and Time of Payment. All
payments of principal of and interest on the Loans and
Reimbursement Obligations and other Obligations (including,
without limitation, fees and expenses) which are payable to
the Administrative Agent, the Lenders or any Issuing Bank
shall be made without condition, set-off, or reservation of
right, and, with respect to payments made other than from
application of deposits in the Concentration Account, in
immediately available funds, delivered to the Administrative
Agent (or, in the case of Reimbursement Obligations, to the
pertinent Issuing Bank) not later than 11:00 a.m. (New York
time) on the date and at the place due, to such account of
the Administrative Agent (or such Issuing Bank) as it may
designate, for the account of the Administrative Agent, the
Lenders or such Issuing Bank, as the case may be; and funds
received by the Administrative Agent, including, without
limitation, funds in respect of any Revolving Loans to be
made on that date, not later than 11:00 a.m. (New York time)
on any given Business Day shall be credited against payment
to be made that day and funds received by the Administrative
Agent after that time shall be deemed to have been paid on
the next succeeding Business Day. Payments actually
received by the Administrative Agent for the account of the
Lenders or the Issuing Banks, or any of them, shall be paid
to them by the Administrative Agent promptly after receipt
thereof.
(b) Pre-Default Apportionment of Payments. Subject to
the provisions of Section 4.01 and Section 4.02(f), all
payments of principal and interest in respect of outstanding
Loans, all payments in respect of Reimbursement Obligations,
all payments of fees and all other payments in respect of
any other Obligations, shall be allocated among such of the
Lenders and Issuing Banks as are entitled thereto, in
proportion to their respective Revolving Credit Pro Rata
Shares, Term Loan Pro Rata Shares, as applicable, or
otherwise as provided herein. Except as provided in
Section 4.02(c) with respect to payments and proceeds of
Collateral received after the occurrence of an Event of
Default, all other payments, proceeds of Collateral, and
other amounts received by the Administrative Agent from or
for the benefit of the Borrower shall be applied
(A) first, to pay principal of and interest on any
portion of the Revolving Loans which the Administrative
Agent may have advanced on behalf of any Revolving Lender
other than Citicorp for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrower,
(B) second, to pay principal of and interest on any
Protective Advance for which the Administrative Agent has
not then been paid by the Borrower or reimbursed by the
Lenders,
(C) third, to pay the principal of the Term Loans and
Revolving Loans then due and payable in the order described
hereinbelow and interest on such Loans then due and payable,
ratably, based on the then outstanding balances of the such
Loans,
(D) fourth, to pay all other Obligations then due and
payable, ratably, and
(E) fifth, as the Borrower so designates.
All such principal and interest payments in respect of Term
Loans and Revolving Loans shall be applied first, to the
Term Loans (to installments and accrued interest then due
and payable, ratably, in accordance with the Lenders'
respective Pro Rata Shares) and second, to the Revolving
Loans and accrued interest thereon; in either case, first,
to repay outstanding Base Rate Loans and then to repay
outstanding Eurodollar Rate Loans with those Eurodollar Rate
Loans which have earlier expiring Eurodollar Interest
Periods being repaid prior to those which have later
expiring Eurodollar Interest Periods.
(c) Post-Default Apportionment of Payments. After the
occurrence of an Event of Default and while the same is
continuing, the Administrative Agent shall apply all
payments in respect of any Obligations and all proceeds of
Collateral in the following order:
(A) first, to pay principal of and interest on any
portion of the Revolving Loans which the Administrative
Agent may have advanced on behalf of any Revolving Lender
other than Citicorp for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrower;
(B) second, to pay principal of and interest on any
Protective Advance for which the Administrative Agent has
not then been paid by the Borrower or reimbursed by the
Lenders;
(C) third, to pay Obligations in respect of any fees,
expense reimbursements or indemnities then due to the
Administrative Agent;
(D) fourth, to pay principal of and interest on Letter
of Credit Obligations (or, to the extent such Obligations
are contingent, deposited in the Cash Collateral Account to
provide Cash Collateral in respect of such Obligations);
(E) fifth, to pay Obligations in respect of any fees,
expense reimbursements or indemnities then due to the
Lenders and the Issuing Banks;
(F) sixth, to pay interest due in respect of the
Loans, ratably, in accordance with the Lenders' respective
Revolving Credit Pro Rata Shares and Term Loan Pro Rata
Shares, as applicable;
(G) seventh, to the ratable payment or prepayment of
principal outstanding on all Loans in accordance with the
Lenders; respective Revolving Credit Pro Rata Shares and
Term Loan Pro Rata Shares, as applicable;
(H) eighth, to the ratable payment of Hedge Agreements
to which any of the Lenders or any Affiliate of any of the
Lenders is a party; and
(I) ninth, to the ratable payment of all other
Obligations.
(d) Administrative Agent Authority to Apply Funds.
The Administrative Agent, in its sole discretion subject
only to the terms of this Section 4.02(d), may pay from the
proceeds of Revolving Loans made to the Borrower hereunder,
whether made following a request by the Borrower pursuant to
Section 2.02 or a deemed request as provided in this
Section 4.02(d), all amounts payable by the Borrower
hereunder, including, without limitation, amounts payable
with respect to payments of principal, interest,
Reimbursement Obligations and fees and all reimbursements
for expenses pursuant to Section 15.02. The Borrower hereby
irrevocably authorizes the Revolving Lenders to make
Revolving Loans, which Revolving Loans shall be Base Rate
Loans, in each case, upon notice from the Administrative
Agent as described in the following sentence for the purpose
of paying principal, interest, Reimbursement Obligations and
fees due from the Borrower, reimbursing expenses pursuant to
Section 15.02 and paying any and all other amounts due and
payable by the Borrower hereunder or under the Notes, and
agrees that all such Revolving Loans so made shall be deemed
to have been requested by it pursuant to Section 2.02 as of
the date of the aforementioned notice. The Administrative
Agent shall request Revolving Loans on behalf of the
Borrower as described in the preceding sentence by notifying
the Revolving Lenders by telecopy, telegram or other similar
form of transmission (which notice the Administrative Agent
shall thereafter promptly transmit to the Borrower), of the
amount and Funding Date of the proposed Borrowing and that
such Borrowing is being requested on the Borrower's behalf
pursuant to this Section 4.02(d). On the proposed Funding
Date for such Revolving Loan, the Revolving Lenders shall
make the requested Revolving Loans in accordance with the
procedures and subject to the conditions specified in
Section 2.02.
(e) Priorities and Distributions of Payments. The
orders of priority set forth in Sections 4.02(b) and (c) and
the related provisions of this Agreement are set forth
solely to determine the rights and priorities of the
Administrative Agent, the Lenders, the Issuing Banks and
other Holders as among themselves. Subject to
Section 4.02(f), the Administrative Agent shall promptly
distribute to each Lender and Issuing Bank at its primary
address set forth on the appropriate signature page hereof
or the signature page to the Assignment and Acceptance by
which it became a Lender or Issuing Bank, or at such other
address as a Lender, an Issuing Bank or other Holder may
request in writing, such funds as such Person may be
entitled to receive, subject to the provisions of Article
XIV; provided that the Administrative Agent shall under no
circumstances be bound to inquire into or determine the
validity, scope or priority of any interest or entitlement
of any Holder and may suspend all payments or seek
appropriate relief (including, without limitation,
instructions from the Requisite Lenders or an action in the
nature of interpleader) in the event of any doubt or dispute
as to any apportionment or distribution contemplated hereby.
(f) Defaulting Lenders. In the event that any Lender
fails to fund its Pro Rata Share of any Revolving Loan
requested by the Borrower which such Lender is obligated to
fund under the terms of this Agreement (the funded portion
of such Revolving Loan being hereinafter referred to as a
"Non Pro Rata Loan"), until the earlier of such Lender's
cure of such failure and the termination of the Revolving
Credit Commitments, the proceeds of all amounts thereafter
repaid to the Administrative Agent by the Borrower and
otherwise required to be applied to such Lender's share of
all other Obligations pursuant to the terms of this
Agreement shall be advanced to the Borrower by the
Administrative Agent on behalf of such Lender to cure, in
full or in part, such failure by such Lender, but shall
nevertheless be deemed to have been paid to such Lender in
satisfaction of such other Obligations. Notwithstanding
anything in this Agreement to the contrary:
(i) the foregoing provisions of this Section 4.02(f)
shall apply only with respect to the proceeds of payments of
Obligations and shall not affect the conversion or
continuation of Loans pursuant to Section 5.01(c);
(ii) a Lender shall be deemed to have cured its
failure to fund its Pro Rata Share of any Revolving Loan at
such time as an amount equal to such Lender's original Pro
Rata Share of the requested principal portion of such
Revolving Loan is fully funded to the Borrower, whether made
by such Lender itself or by operation of the terms of this
Section 4.02(f), and whether or not the Non Pro Rata Loan
with respect thereto has been repaid, converted or
continued;
(iii) amounts advanced to the Borrower to cure, in
full or in part, any such Lender's failure to fund its Pro
Rata Share of any Revolving Loan ("Cure Loans") shall bear
interest at the rate in effect from time to time pursuant to
Section 5.01 and for all other purposes of this Agreement
shall be treated as if they were Base Rate Loans; and
(iv) regardless of whether or not an Event of Default
has occurred or is continuing, and notwithstanding the
instructions of the Borrower as to its desired application,
all repayments of principal which, in accordance with the
other terms of this Section 4.02, would be applied to the
outstanding Revolving Loans which are Base Rate Loans shall
be applied first, ratably to all such Base Rate Loans
constituting Non Pro Rata Loans, second, ratably to such
Base Rate Loans other than those constituting Non Pro Rata
Loans or Cure Loans and, third, ratably to such Base Rate
Loans constituting Cure Loans.
(g) Payments on Non-Business Days. Whenever any pay-
ment to be made by the Borrower hereunder or under the Notes
is stated to be due on a day which is not a Business Day,
the payment shall instead be due on the next succeeding
Business Day (except as set forth in Section 5.02(b)(iii)
with respect to payments due on the next preceding Business
Day), and any such extension of time shall be included in
the computation of the payment of interest and fees
hereunder.
4.03. Promise to Repay; Evidence of Indebtedness.
(a) Promise to Repay. The Borrower hereby agrees to
pay when due the principal amount of each Loan which is made
to it, and further agrees to pay all unpaid interest accrued
thereon, in accordance with the terms of this Agreement and
the Notes. The Borrower shall execute and deliver to each
Lender on the Closing Date a promissory note, in form and
substance acceptable to the Administrative Agent and such
Lender, evidencing the Loans and thereafter shall execute
and deliver such other promissory notes as are necessary to
evidence Loans owing to the Lenders after giving effect to
any assignment thereof pursuant to Section 15.01, all in
form and substance acceptable to the Administrative Agent
and the parties to such assignment.
(b) Loan Account. Each Lender shall maintain in
accordance with its usual practice an account or accounts (a
"Loan Account") evidencing the Indebtedness of the Borrower
to such Lender resulting from each Loan owing to such Lender
from time to time, including the amount of principal and
interest payable and paid to such Lender from time to time
hereunder and under the Notes.
(c) Control Account. The Register maintained by the
Administrative Agent pursuant to Section 15.01(c) shall
include a control account, and a subsidiary account for each
Lender, in which accounts (taken together) shall be recorded
(i) the date and amount of each Borrowing made hereunder,
the type of Loan comprising such Borrowing and any
Eurodollar Interest Period applicable thereto, (ii) the
effective date and amount of each Assignment and Acceptance
delivered to and accepted by it and the parties thereto,
(iii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to
each Lender hereunder or under the Notes, and (iv) the
amount of any sum received by the Administrative Agent from
the Borrower hereunder and each Lender's share thereof.
(d) Entries Binding. The entries made in the Register
and each Loan Account shall be conclusive and binding for
all purposes, absent manifest error.
4.04. Proceeds of Collateral; Concentration Account
Arrangements. (a) Establishment. The Borrower shall
establish and maintain, and shall cause its Domestic
Subsidiaries to establish and maintain, Collection Accounts
into which all collections of Receivables shall be deposited
and promptly transferred directly to the Concentration
Account. Borrower shall cause all other proceeds of
Collateral to be deposited in the Concentration Account or
pursuant to other similar arrangements for the collection of
such amounts established by the Borrower and the
Administrative Agent. All collections of Receivables and
other proceeds of Collateral which are received directly by
the Borrower or any Subsidiary of the Borrower shall be
deemed to have been received by the Borrower or such
Subsidiary of the Borrower as the Administrative Agent's
trustee and, upon the Borrower's or such Subsidiary's
receipt thereof, the Borrower shall immediately transfer, or
cause to be transferred, all such amounts into the
Concentration Account in their original form. All
collections of Receivables, all payments, and all proceeds
of other Collateral received by the Administrative Agent,
whether through payment, deposit in the Concentration
Account as described above, or otherwise, will be deemed
received by the Administrative Agent, will be the sole
property of the Administrative Agent, and will be held by
the Administrative Agent, for the benefit of the Holders (i)
for application to the Obligations pursuant to Section 4.02
and (ii) thereafter, as Cash Collateral for the Obligations,
subject to the rights of the Borrower set forth in Section
4.04(b) and the rights of the Administrative Agent set forth
in Section 4.06.
(b) Pre-Default Withdrawals from Concentration
Account. If requested by the Borrower, the Administrative
Agent shall, so long as no Event of Default shall have
occurred and be continuing or unwaived, from time to time,
(i) apply funds in the Concentration Account (A) promptly
after deposit therein to payment of the Loans and (B) to
payment of other Obligations as they become due and payable,
(ii) after giving effect to the aforesaid payments, invest
funds on deposit in the Concentration Account and accrued
interest thereon, reinvest proceeds of any such investments
which may mature or be sold, and invest interest or other
income received from such investments, in such Cash
Equivalents as the Borrower may select, and (iii) upon
Borrower's request therefor after giving effect to the
payments described in clause (i) above, transfer funds on
deposit in the Concentration Account to Borrower's or its
Subsidiaries' designated accounts. Such funds, interest,
proceeds, or income which are not so disbursed, invested or
reinvested shall be deposited and held in the Concentration
Account for the benefit of the Holders as provided in
Section 4.04(a). None of the Administrative Agent, any
Lender or any Issuing Bank shall be liable to the Borrower
or any Subsidiary of the Borrower for, or with respect to,
any decline in value of amounts on deposit in the
Concentration Account which shall have been invested
pursuant to this Section 4.04(b). Cash Equivalents from time
to time purchased and held pursuant to this Section 4.04(b)
shall constitute Cash Collateral and shall, for purposes of
this Agreement, be deemed to be part of the funds held in
the Concentration Account in amounts equal to their
respective outstanding principal amounts.
(c) Reasonable Care. The Administrative Agent shall
exercise reasonable care in the custody and preservation of
any funds held in the Concentration Account and shall be
deemed to have exercised such care if such funds are
accorded treatment substantially equivalent to that which
the Administrative Agent accords its own like property, it
being understood that the Administrative Agent shall not
have any responsibility for taking any steps necessary to
preserve rights against any parties with respect to any such
funds but may do so at its option. All reasonable expenses
incurred in connection therewith shall be for the sole
account of the Borrower and shall constitute Obligations
hereunder.
4.05. Cash Collateral Account. (a) Investments. If
requested by the Borrower, the Administrative Agent shall,
so long as no Event of Default shall have occurred and be
continuing, from time to time invest funds on deposit in the
Cash Collateral Account and accrued interest thereon,
reinvest proceeds of any such investments which may mature
or be sold, and invest interest or other income received
from any such Investments, in each case in such Cash
Equivalents as the Borrower may select; provided, however,
that such accrued interest and other income received from
any such Investments, upon the request of the Borrower,
shall be remitted to the Borrower. Such funds, interest,
proceeds or income which are not so invested or reinvested
in Cash Equivalents shall, except as otherwise provided
above or in Section 4.05(b) and Section 4.06, be deposited
and held by the Administrative Agent in the Cash Collateral
Account. None of the Administrative Agent, any Lender or
any Issuing Bank shall be liable to the Borrower for, or
with respect to, any decline in value of amounts on deposit
in the Cash Collateral Account which shall have been
invested pursuant to this Section 4.05(a) at the direction
of the Borrower. Cash Equivalents from time to time
purchased and held pursuant to this Section 4.05(a) shall
constitute Cash Collateral and shall, for purposes of this
Agreement, be deemed to be part of the funds held in the
Cash Collateral Account in amounts equal to their respective
outstanding principal amounts.
(b) Withdrawal Rights. Neither the Borrower nor any
Person or entity claiming on behalf of or through the
Borrower shall have any right to withdraw any of the funds
held in the Cash Collateral Account, except that, upon the
later to occur of (i) the expiration or termination of all
of the Letters of Credit in accordance with their respective
terms and (ii) the payment in full in cash of the
Obligations, any funds remaining in the Cash Collateral
Account shall be returned by the Administrative Agent to the
Borrower or paid to whomever may be legally entitled
thereto.
(c) Additional Deposits. If at any time the
Administrative Agent determines that any funds held in the
Cash Collateral Account are subject to any interest, right,
claim or Lien of any Person other than the Administrative
Agent, the Borrower will, forthwith upon demand by the
Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in the Cash
Collateral Account, an amount equal to the amount of funds
subject to such interest, right, claim or Lien.
(d) Reasonable Care. The Administrative Agent shall
exercise reasonable care in the custody and preservation of
any funds held in the Cash Collateral Account and shall be
deemed to have exercised such care if such funds are
accorded treatment substantially equivalent to that which
the Administrative Agent accords its own like property, it
being understood that the Administrative Agent shall not
have any responsibility for taking any necessary steps to
preserve rights against any parties with respect to any such
funds but may do so at its option. All expenses incurred in
connection therewith shall be for the sole account of the
Borrower and shall constitute Obligations hereunder.
4.06. Post-Default Withdrawals from the Concentration
Account and Cash Collateral Account. Notwithstanding any
other provision of this Agreement, from and after (a) the
occurrence of an Event of Default described in Section
12.01(a) and for so long as the same is continuing unwaived
or (b) the occurrence of any other Event of Default and the
Administrative Agent's receipt of written notice from the
Requisite Lenders that no further withdrawals may be made
from the Concentration Account other than for application on
the Obligations for so long as the same is continuing
unwaived, neither the Borrower nor any Person or entity
claiming on behalf of or through the Borrower shall have any
right to withdraw any of the funds held in the Concentration
Account. The Administrative Agent may, at any time during
the period clause (a) or clause (b) above is applicable,
sell or cause to be sold any Cash Equivalents being held by
the Administrative Agent in the Concentration Account or as
Cash Collateral at any broker's board or at public or
private sale, in one or more sales or lots, at such price as
the Administrative Agent may deem best, without assumption
of any credit risk, and the purchaser of any or all such
Cash Equivalents so sold shall thereafter own the same,
absolutely free from any claim, encumbrance or right of any
kind whatsoever. The Administrative Agent or any Holder may,
in its own name or in the name of a designee or nominee, buy
such Cash Equivalents at any public sale and, if permitted
by applicable law, buy such Cash Equivalents at any private
sale. The Administrative Agent shall apply the proceeds of
any such sale, net of any reasonable expenses incurred in
connection therewith, and any other funds deposited in the
Concentration Account or Cash Collateral Account to the
payment of the Obligations in accordance with Section
4.02(c), other than amounts which are being held as Cash
Collateral for Reimbursement Obligations, which shall be
applied to such Reimbursement Obligations without regard to
Section 4.02(c). The Borrower agrees that any sale of Cash
Equivalents conducted in conformity with reasonable
commercial practices of banks, commercial finance companies,
insurance companies or other financial institutions
disposing of property similar to such Cash Equivalents shall
be deemed to be commercially reasonable and any requirements
of reasonable notice shall be met if such notice is given by
the Administrative Agent within a commercially reasonable
time prior to such disposition, the time of delivery of
which notice the parties hereto agree shall in no event be
required to be greater than five (5) Business Days before
the date of the intended sale or disposition. Any other
requirement of notice, demand or advertisement for sale is
waived to the extent permitted by law. The Administrative
Agent may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor
and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
ARTICLE V
INTEREST AND FEES
5.01. Interest on the Loans and other
Obligations. (a) Rate of Interest. (i) All Loans and the
outstanding principal balance of all other Obligations shall
bear interest on the unpaid principal amount thereof from
the date such Loans are made and such other Obligations are
incurred until paid in full, except as otherwise provided in
Section 5.01(d) or Section 14.04, as follows:
(A) If a Base Rate Loan or such other Obligation, at a
rate per annum equal to the sum of (1) the Base Rate, as in
effect from time to time as interest accrues plus (2) the
applicable Base Rate Margin; and
(B) If a Eurodollar Rate Loan, at a rate per annum
equal to the sum of (1) the Eurodollar Rate determined for
the applicable Eurodollar Interest Period, plus (2) the
applicable Eurodollar Rate Margin.
(ii) The applicable basis for determining the rate of
interest on the Loans shall be selected by the Borrower at
the time a Notice of Borrowing or a Notice of Conver-
sion/Continuation is delivered by the Borrower to the
Administrative Agent; provided, however, the Borrower may
not select the Eurodollar Rate as the applicable basis for
determining the rate of interest on such a Loan if (A) such
Loan is to be made on the Closing Date or (B) at the time of
such selection an Event of Default or a Potential Event of
Default would occur or has occurred and is continuing. If
on any day any Loan is outstanding with respect to which
notice has not been timely delivered to the Administrative
Agent in accordance with the terms of this Agreement speci-
fying the basis for determining the rate of interest on that
day, then for that day interest on that Loan shall be
determined by reference to clause (i)(A) above.
(b) Interest Payments. (i) Interest accrued on each
Base Rate Loan shall be payable in arrears (A) on the first
Business Day of each month, commencing with the month
following the month in which such Loan was made, (B) if such
Base Rate Loan is a Term Loan, upon the payment or
prepayment thereof in full or in part, (C) upon conversion
thereof to a Eurodollar Rate Loan, and (D) if not
theretofore paid in full, at maturity (whether by
acceleration or otherwise) of such Base Rate Loan.
(ii) Interest accrued on each Eurodollar Rate Loan
shall be payable in arrears (A) on each Eurodollar Interest
Payment Date applicable to such Loan, (B) upon the payment
or prepayment thereof in full or in part, and (C) if not
theretofore paid in full, at maturity (whether by
acceleration or otherwise) of such Eurodollar Rate Loan.
(iii) Interest accrued on the principal balance of all
other Obligations shall be payable in arrears (A) on the
last day of each calendar month, commencing on the first
such day following the incurrence of such Obligation,
(B) upon repayment thereof in full or in part, and (C) if
not theretofore paid in full, at the time such other
Obligation becomes due and payable (whether by acceleration
or otherwise).
(c) Conversion or Continuation. (i) The Borrower
shall have the option (A) to convert at any time all or any
part of outstanding Base Rate Loans to Eurodollar Rate
Loans; (B) to convert all or any part of outstanding
Eurodollar Rate Loans having Eurodollar Interest Periods
which expire on the same date to Base Rate Loans on such
expiration date; or (C) to continue all or any part of
outstanding Eurodollar Rate Loans having Eurodollar Interest
Periods which expire on the same date as Eurodollar Rate
Loans, and the succeeding Eurodollar Interest Period of such
continued Loans shall commence on such expiration date; pro-
vided, however, no such outstanding Loan may be continued
as, or be converted into, a Eurodollar Rate Loan (i) if such
continuation of, or conversion into, would violate any of
the provisions of Section 5.02 or (ii) if an Event of
Default or a Potential Event of Default would occur or has
occurred and is continuing. Any conversion into or
continuation of Eurodollar Rate Loans under this Section
5.01(c) shall be in a minimum amount of $1,000,000 and in
integral multiples of $1,000,000 in excess of that amount
except in the case of a conversion into or a continuation of
an entire Borrowing of Non Pro Rata Loans.
(ii) To convert or continue a Loan under Section
5.01(c)(i), the Borrower shall deliver a Notice of Conver-
sion/Continuation to the Administrative Agent no later than
11:00 a.m. (New York time) at least two (2) Business Days in
advance of the proposed conversion/continuation date. A
Notice of Conversion/Continuation shall specify (A) the
proposed conversion/continuation date (which shall be a
Business Day), (B) the aggregate principal amount of the
Loans to be converted/continued, (C) whether such Loan shall
be converted and/or continued, and (D) in the case of a con-
version to, or continuation of, a Eurodollar Rate Loan, the
requested Eurodollar Interest Period. In lieu of delivering
a Notice of Conversion/Continuation, the Borrower may give
the Administrative Agent telephonic notice of any proposed
conversion/continuation by the time required under this
Section 5.01(c)(ii), and such notice shall be confirmed in
writing delivered to the Administrative Agent by facsimile
transmission promptly (but in no event later than 5:00 p.m.
(New York time) on the same day), the original of which
facsimile copy shall be delivered to the Administrative
Agent within three (3) days after the date of such
transmission. Promptly after receipt of a Notice of
Conversion/Continuation under this Section 5.01(c)(ii) (or
telephonic notice in lieu thereof), the Administrative Agent
shall notify each Lender by telex or telecopy, or other
similar form of transmission, of the proposed conversion/
continuation. Any Notice of Conversion/Continuation for
conversion to, or continuation of, a Loan (or telephonic
notice in lieu thereof) shall be irrevocable, and the
Borrower shall be bound to convert or continue in accordance
therewith.
(d) Default Interest. Notwithstanding the rates of
interest specified in Section 5.01(a), effective immediately
upon (i) the occurrence of an Event of Default described in
Sections 12.01(a), (b) (as it pertains to defaults under
Article XI), (f), (g), (h), or (i) (except an Event of
Default under (i) resulting from the gross negligence or
willful misconduct of the Administrative Agent) or (ii) the
occurrence of any other Event of Default and notice from the
Requisite Lenders of the effectiveness of this
Section 5.01(d), and for as long thereafter as such Event of
Default shall be continuing unwaived, the principal balance
of all Obligations, including, to the extent permitted by
applicable law, accrued interest unpaid when due, shall bear
interest, payable on demand, at a rate which is two percent
(2.0%) per annum in excess of the rate of interest specified
in Section 5.01(a)(i).
(e) Computation of Interest. Interest on all Obliga-
tions shall be computed on the basis of the actual number of
days elapsed in the period during which interest accrues and
a year of 360 days. In computing interest on any Loan, the
date of the making of the Loan or the first day of a
Eurodollar Interest Period, as the case may be, shall be
included and the date of payment or the expiration date of a
Eurodollar Interest Period, as the case may be, shall be
excluded; provided, however, if a Loan is repaid on the same
day on which it is made, one (1) day's interest shall be
paid on such Loan.
5.02. Special Provisions Governing Eurodollar Rate
Loans. With respect to Eurodollar Rate Loans:
(a) Amount of Eurodollar Rate Loans. Each Borrowing
of Eurodollar Rate Loans shall be for a minimum amount of
$1,000,000 and in integral multiples of $1,000,000 in excess
of that amount.
(b) Determination of Eurodollar Interest Period. By
giving notice as set forth in Section 2.02(b) (with respect
to a Borrowing of Eurodollar Rate Loans) or Section 5.01(c)
(with respect to a conversion into or continuation of
Eurodollar Rate Loans), the Borrower shall have the option,
subject to the other provisions of this Section 5.02, to
select an interest period (each, a "Eurodollar Interest
Period") to apply to the Loans described in such notice,
subject to the following provisions:
(i) The Borrower may only select, as to a particular
Borrowing of Eurodollar Rate Loans, a Eurodollar Interest
Period of one, two, or three months in duration;
(ii) In the case of immediately successive Eurodollar
Interest Periods applicable to a Borrowing of Eurodollar
Rate Loans, each successive Eurodollar Interest Period shall
commence on the day on which the next preceding Eurodollar
Interest Period expires;
(iii) If any Eurodollar Interest Period would
otherwise expire on a day which is not a Business Day, such
Eurodollar Interest Period shall be extended to expire on
the next succeeding Business Day if the next succeeding
Business Day occurs in the same calendar month, and if there
will be no succeeding Business Day in such calendar month,
the Eurodollar Interest Period shall expire on the
immediately preceding Business Day;
(iv) The Borrower may not select a Eurodollar Interest
Period as to any Revolving Loan if such Eurodollar Interest
Period terminates later than the scheduled Revolving Credit
Termination Date;
(v) The Borrower may not select a Eurodollar Interest
Period as to any Term Loan if such Eurodollar Interest
Period terminates later than the scheduled Term Loan
Termination Date;
(vi) The Borrower may not select a Eurodollar Interest
Period with respect to any portion of principal of a Loan
which extends beyond a date on which the Borrower is
required to make a scheduled payment of such portion of
principal; and
(vii) There shall be no more than six (6) Eurodollar
Interest Periods in effect at any one time.
(c) Determination of Interest Rate. As soon as prac-
ticable on the second Business Day prior to the first day of
each Eurodollar Interest Period (the "Eurodollar Interest
Rate Determination Date"), the Administrative Agent shall
determine (pursuant to the procedures set forth in the
definition of "Eurodollar Rate") the interest rate which
shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable
Eurodollar Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to
the Borrower and to each Lender. The Administrative Agent's
determination shall be presumed to be correct, absent
manifest error, and shall be binding upon the Borrower.
(d) Interest Rate Unascertainable, Inadequate or
Unfair. In the event that at least one (1) Business Day
before the Eurodollar Interest Rate Determination Date:
(i) the Administrative Agent is advised by Citibank
that deposits in Dollars (in the applicable amounts) are not
being offered by Citibank in the London interbank market for
such Eurodollar Interest Period; or
(ii) the Administrative Agent determines that adequate
and fair means do not exist for ascertaining the applicable
interest rates by reference to which the Eurodollar Rate
then being determined is to be fixed; or
(iii) the Requisite Lenders advise the Administrative
Agent that the Eurodollar Rate for Eurodollar Rate Loans
comprising such Borrowing will not adequately reflect the
cost to such Requisite Lenders of obtaining funds in Dollars
in the London interbank market in the amount substantially
equal to such Lenders' Eurodollar Rate Loans in Dollars and
for a period equal to such Eurodollar Interest Period;
then the Administrative Agent shall forthwith give notice
thereof to the Borrower, whereupon (until the Administrative
Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist) the right of the
Borrower to elect to have Loans bear interest based upon the
Eurodollar Rate shall be suspended and each outstanding
Eurodollar Rate Loan shall be converted into a Base Rate
Loan on the last day of the then current Eurodollar Interest
Period therefor, notwithstanding any prior election by the
Borrower to the contrary.
(f) Booking of Eurodollar Rate Loans. Any Lender may
make, carry or transfer Eurodollar Rate Loans at, to, or for
the account of, its Eurodollar Lending Office or Eurodollar
Affiliate or its other offices or Affiliates. No Lender
shall be entitled, however, to receive any greater amount
under Article XIV as a result of the transfer of any such
Eurodollar Rate Loan to any office (other than such
Eurodollar Lending Office) or any Affiliate (other than such
Eurodollar Affiliate) than such Lender would have been
entitled to receive immediately prior thereto, unless (i)
the transfer occurred at a time when circumstances giving
rise to the claim for such greater amount did not exist and
(ii) such claim would have arisen even if such transfer had
not occurred.
(g) Affiliates Not Obligated. No Eurodollar Affiliate
or other Affiliate of any Lender shall be deemed a party to
this Agreement or shall have any liability or obligation
under this Agreement.
5.03. Fees. (a) Administrative Agent's Fee. The
Borrower shall pay to the Administrative Agent, solely for
the account of the Administrative Agent, the fee provided in
the Fee Letter as and when set forth therein during the term
of this Agreement.
(b) Letter of Credit Fee. In addition to any charges
paid pursuant to Section 3.01(g), the Borrower shall pay (i)
to the Issuing Bank, a fee equal to one-quarter of one
percent (0.25%) on the face amount of each Letter of Credit
issued by such Issuing Bank, upon issuance of such Letter of
Credit (the "Fronting Fee") and (ii) to the Administrative
Agent, for the account of the Revolving Lenders based on
their respective Revolving Credit Pro Rata Shares, a fee
(the "Letter of Credit Fee") accruing at a per annum rate
equal to the Eurodollar Rate Margin on the undrawn face
amount of each outstanding Letter of Credit, payable
quarterly, in arrears, on the last day of each calendar
quarter and the Revolving Credit Termination Date; provided,
however, upon (A) the occurrence of an Event of Default
referenced in Section 5.01(d)(i) or (B) the occurrence of
any other Event of Default and notice from the Requisite
Lenders of the effectiveness of Section 5.01(d), and for so
long thereafter as such Event of Default shall be continuing
unwaived, the rate at which the Letter of Credit Fees shall
accrue and be payable shall be equal to two percent (2.0%)
per annum plus the Eurodollar Rate Margin.
(c) Commitment Fee. (i) The Borrower shall pay to the
Administrative Agent, for the account of the Revolving
Lenders in accordance with their respective Revolving Credit
Pro Rata Shares, a fee (the "Commitment Fee"), accruing at
the rate of one-half of one percent (0.50%) per annum on the
average amount by which the Revolving Credit Commitments
exceed the sum of (A) the outstanding principal amount of
the Revolving Loans, plus (B) the outstanding Reimbursement
Obligations, plus (C) the aggregate undrawn face amount of
all outstanding Letters of Credit for the period commencing
on the Closing Date and ending on the Revolving Credit
Termination Date, such Commitment Fee being payable (1)
quarterly, in arrears, commencing on the first day of the
calendar quarter next succeeding the Closing Date and (2) on
the Revolving Credit Termination Date.
(ii) Notwithstanding the foregoing, in the event that
any Revolving Lender fails to fund its Revolving Credit Pro
Rata Share of any Revolving Loan requested by the Borrower
which such Lender is obligated to fund under the terms of
this Agreement, (A) such Lender shall not be entitled to any
Commitment Fees with respect to its Revolving Credit
Commitment until such failure has been cured in accordance
with Section 4.02(f)(ii) and (B) until such time, the
Commitment Fee shall accrue in favor of the Revolving
Lenders which have funded their respective Revolving Credit
Pro Rata Shares of such requested Revolving Loan, shall be
allocated among such performing Revolving Lenders ratably
based upon their relative Revolving Credit Commitments, and
shall be calculated based upon the average amount by which
the aggregate Revolving Credit Commitments of such
performing Revolving Lenders exceeds the sum of (1) the
outstanding principal amount of the Revolving Loans owing to
such performing Revolving Lenders, plus (2) the outstanding
Reimbursement Obligations owing to such performing Revolving
Lenders, plus (3) the aggregate participation interests of
such performing Revolving Lenders arising pursuant to
Section 3.01(e) with respect to undrawn and outstanding
Letters of Credit.
(d) Calculation and Payment of Fees. All of the above
fees shall be calculated on the basis of the actual number
of days elapsed in a 360-day year. All such fees shall be
payable in addition to, and not in lieu of, interest,
compensation, expense reimbursements, indemnification and
other Obligations, to the Administrative Agent at its office
in New York, New York in immediately available funds. All
fees shall be fully earned and nonrefundable when paid. All
fees specified or referred to in this Agreement due to the
Administrative Agent, any Issuing Bank or any Lender,
including, without limitation, those referred to in this
Section 5.03, shall bear interest, if not paid when due, at
the interest rate for Base Rate Loans set forth in
Section 5.01(d), shall constitute Obligations and shall be
secured by all of the Collateral.
ARTICLE VI
CONDITIONS TO LOANS AND LETTERS OF
CREDIT
6.01. Conditions Precedent to the Initial Loans and
Letters of Credit. The obligation of each Lender on the
Closing Date to make its Term Loan and any Revolving Loan
requested to be made by it, and the agreement of each
Issuing Bank on the Closing Date to issue Letters of Credit,
shall be subject to the satisfaction of all of the following
conditions precedent:
(a) Documents. The Administrative Agent shall have
received on or before the Closing Date all of the following:
(i) this Agreement, the Notes and all other
agreements, documents and instruments relating to the loan
and other credit transactions contemplated by this Agreement
and described in the List of Closing Documents attached
hereto as Exhibit H attached hereto and made a part hereof,
each duly executed where appropriate and in form and
substance satisfactory to the Administrative Agent; without
limiting the foregoing, the Borrower hereby directs its
counsel, Cahill, Gordon & Reindel and General Counsel,
Donald E. Miller, to prepare and deliver to the
Administrative Agent, the Lenders, the Issuing Banks and
Sidley & Austin, the opinions referred to in such List of
Closing Documents;
(ii) the Pro Forma and Projections, in form and
substance satisfactory to the Administrative Agent;
(iii) documentation deemed adequate by the
Administrative Agent demonstrating full compliance by the
Borrower and its Subsidiaries with any applicable
Environmental Property Transfer Act;
(iv) an Officer's Certificate executed and delivered
by the president or vice president of the Borrower
certifying that all conditions precedent have been met and
no Potential Event of Default or Event of Default has
occurred or is continuing;
(v) a Tax Allocation Agreement in form and substance
satisfactory to the Administrative Agent; and
(vi) such additional documentation as the
Administrative Agent may reasonably request.
(b) Perfection of Liens; Title Insurance. Evidence
that all financing statements, mortgages and leasehold
mortgages relating to the Collateral have been filed or
recorded, certificates representing Capital Stock included
in the Collateral have been delivered to the Administrative
Agent (with duly executed stock powers), the CM Letter of
Credit and CM Notes shall have been delivered to the
Administrative Agent (duly endorsed or with duly executed
transfer instructions, as applicable), and all title
charges, recording fees and filing taxes have been paid.
(c) The Asset Transfers. The Lenders shall be
satisfied in all material respects that the parties to the
Transfer Documents complied with all applicable laws and
regulatory approval requirements and all contractual
approval and consent requirements, that the transfers
contemplated thereby have been consummated, and that the CM
Letter of Credit has been received by Borrower and delivered
to the Administrative Agent.
(d) STI Merger. The merger of FII with and into
Shared Technologies, Inc. shall have become effective on
terms (including, without limitation, terms of indemnities
from TFC and its Subsidiaries) and pursuant to documentation
acceptable, in form and substance, to the Administrative
Agent and all of the obligations of FII and VSI under that
certain Restated and Amended Credit Agreement dated as of
July 27, 1992 (the "1992 Credit Agreement") which become
obligations of Shared Technologies, Inc. upon the aforesaid
merger becoming effective shall have been paid in full, in
cash.
(e) Due Diligence. The Administrative Agent and its
counsel shall have completed their updated due diligence
review of the financial condition, business, operations,
assets, liabilities (environmental, by way of
indemnification, and otherwise), pending and threatened
litigation, corporate, capital, legal and management
structure and Contractual Obligations of Borrower and each
of its Subsidiaries, the results of which shall have
provided the Administrative Agent, each Lender and each
Issuing Bank with results and information which, in the
judgment of such Person, are satisfactory to permit the
Administrative Agent, each Lender and each Issuing Bank to
enter into the financing transactions contemplated hereby.
All Schedules to this Agreement shall be acceptable to the
Administrative Agent and Lenders.
(f) No Legal Impediments. No law, regulation, order,
judgment or decree of any Governmental Authority shall, and
the Administrative Agent shall not have received any notice
that litigation is pending or threatened which is likely to,
(i) enjoin, prohibit or restrain the making of the Term
Loans and requested Revolving Loans and/or the issuance of
Letters of Credit on the Closing Date or (ii) result in a
Material Adverse Effect.
(g) No Change in Condition. No change in the
business, assets, management, operations, financial
condition or prospects of the Operating Units or any
business, assets, management, operations, financial
condition or prospects of the Borrower's Subsidiaries shall
have occurred since June 30, 1995, which change, in the
judgment of the Requisite Lenders, will, or is reasonably
likely to, result in a Material Adverse Effect.
(h) No Loss of Material Agreements and Licenses. No
agreement or license which, in the judgment of the Requisite
Lenders, is material to the business, operations or employee
relations of the Borrower or any of its Subsidiaries shall
have been terminated, modified, revoked, breached or
declared to be in default and each such Permit, agreement,
and license shall have been transferred to the Borrower
without any breach of the Contractual Obligation governing
the same.
(i) No Market Changes. Since January 16, 1996, no
material adverse change shall have occurred in the
conditions in the capital markets or the market for loan
syndications generally.
(j) No Default. No Event of Default or Potential
Event of Default shall have occurred and be continuing or
would result from the making of the Loans and no "Event of
Default" (as defined in the 1992 Credit Agreement) shall
have occurred and be continuing unwaived.
(k) Representations and Warranties. All of the repre-
sentations and warranties contained in Section 7.01 and in
any of the other Loan Documents shall be true and correct in
all material respects on and as of the Closing Date.
(l) Fees and Expenses Paid. There shall have been
paid to the Administrative Agent, for the accounts of the
Lenders, Issuing Banks, and the Administrative Agent, as
applicable, all fees and expenses due and payable on or
before the Closing Date.
6.02. Conditions Precedent to All Subsequent Loans and
Letters of Credit. The obligation of each Lender to make
any Loan requested to be made by it on any Funding Date and
the agreement of each Issuing Bank to issue any Letter of
Credit on any date is subject to the following conditions
precedent as of each such date, both before and after giving
effect to the Loans to be made and/or the Letter of Credit
to be issued on such date:
(a) Representations and Warranties. All of the
representations and warranties of the Borrower contained in
Section 7.01 and in any other Loan Document (other than
representations and warranties which expressly speak as of a
different date) shall be true and correct in all material
respects.
(b) No Defaults. No Event of Default or Potential
Event of Default shall have occurred and be continuing or
would result from the making of the requested Loan or
issuance of the requested Letter of Credit.
(c) No Legal Impediments. No law, regulation, order,
judgment or decree of any Governmental Authority shall, and
the Administrative Agent shall not have received from any
Lender or Issuing Bank notice that, in the judgment of such
Lender or Issuing Bank, litigation is pending or threatened
which is likely to, enjoin, prohibit or restrain, or impose
or result in the imposition of any material adverse condi-
tion upon, (i) such Lender's making of the requested Loan or
participation in the requested Letter of Credit or (ii) such
Issuing Bank's issuance of the requested Letter of Credit.
(d) No Material Adverse Effect. No event shall have
occurred since the date of this Agreement which has
resulted, or is reasonably likely to result, in a Material
Adverse Effect.
Each submission by the Borrower to the Administrative Agent
of a Notice of Borrowing with respect to any Loan or a
Notice of Conversion/Continuation with respect to any Loan,
each acceptance by the Borrower of the proceeds of each Loan
made, converted or continued hereunder, each submission by
the Borrower to an Issuing Bank of a request for issuance of
a Letter of Credit and the issuance of such Letter of
Credit, shall constitute a representation and warranty by
the Borrower as of the Funding Date in respect of such Loan,
the date of conversion or continuation and the date of issu-
ance of such Letter of Credit, that all the conditions
contained in this Section 6.02 have been satisfied or waived
in accordance with Section 15.07.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
7.01. Representations and Warranties of the Borrower.
In order to induce the Lenders and the Issuing Banks to
enter into this Agreement and to make the Loans and the
other financial accommodations to the Borrower and to issue
the Letters of Credit described herein, the Borrower hereby
represents and warrants to each Lender, each Issuing Bank
and the Administrative Agent that the following statements
are true, correct and complete:
(a) Organization; Corporate Powers. (i) The Borrower
and each of its Subsidiaries (A) is a corporation duly
organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, (B) is duly
qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction in which
failure to be so qualified and in good standing will have or
is reasonably likely to have a Material Adverse Effect, (C)
which is a Domestic Subsidiary has filed and maintained
effective (unless exempt from the requirements for filing) a
current Business Activity Report with the appropriate
Governmental Authority in the states of Minnesota and New
Jersey, and (D) has all requisite corporate power and
authority to own, operate and encumber its Property and to
conduct its business as presently conducted and as proposed
to be conducted in connection with and following the
consummation of the transactions contemplated by this
Agreement.
(ii) True, correct and complete copies of the
Organizational Documents identified on Schedule 7.01-A
attached hereto have been delivered to the Administrative
Agent, each of which is in full force and effect, has not
been modified or amended except to the extent indicated
therein and, to the best of the Borrower's knowledge, there
are no defaults under such Organizational Documents and no
events which, with the passage of time or giving of notice
or both, would constitute a default under such
Organizational Documents.
(b) Authority. (i) The Borrower and each of its
Subsidiaries have the requisite corporate power and
authority (A) to execute, deliver and perform each of the
Loan Documents which have been executed by it as required by
this Agreement on or prior to the Closing Date and (B) to
file or record the Loan Documents which have been filed or
recorded by it with any Governmental Authority as required
by this Agreement on or prior to the Closing Date.
(ii) The execution, delivery, performance and filing
or recording, as the case may be, of each of the Loan
Documents which have been executed, filed or recorded as
required by this Agreement on or prior to the Closing Date
and to which the Borrower or any of its Subsidiaries is
party and the consummation of the transactions contemplated
thereby, have been duly approved by the respective boards of
directors and, if necessary, the shareholders of the
Borrower and its Subsidiaries and such approvals have not
been rescinded. No other corporate action or proceedings on
the part of the Borrower or any of its Subsidiaries are
necessary to consummate such transactions.
(iii) Each of the Loan Documents to which the Borrower
or any of its Subsidiaries is a party (A) has been duly
executed, delivered, filed or recorded, as the case may be,
by it, (B) where applicable, creates valid and perfected
first Liens in the Collateral covered thereby securing the
payment of all of the Obligations purported to be secured
thereby, (C) constitutes the Borrower's or Subsidiary's
respective legal, valid and binding obligation, enforceable
against it in accordance with its terms, and (D) is in full
force and effect and no material term or condition thereof
has been amended, modified or waived from the terms and
conditions contained therein as delivered to the
Administrative Agent pursuant to Section 6.01(a) without the
prior written consent of the Requisite Lenders. All parties
to the Loan Documents have performed and complied with all
the terms, provisions, agreements and conditions set forth
therein and required to be performed or complied with by
such parties on or before the Closing Date, all filings and
recordings and other actions which are necessary or
desirable to perfect and protect the Liens granted pursuant
to the Loan Documents and preserve their required priority
have been duly taken, and no Potential Event of Default,
Event of Default or breach of any covenant by any such party
exists thereunder.
(c) Subsidiaries; Ownership of Equity Securities.
Schedule 7.01-C attached hereto (i) contains a diagram
indicating the corporate structure of the Borrower, its
Subsidiaries and any other Person in which the Borrower or
any of its Subsidiaries holds a direct or indirect
partnership, joint venture or other equity interest and
indicates the nature of such interest with respect to each
Person included in such diagram; and (ii) accurately sets
forth (A) the correct legal name of such Person, the
jurisdiction of its incorporation or organization and the
jurisdictions in which it is qualified to transact business
as a foreign corporation or otherwise and (B) the
authorized, issued and outstanding shares or interests of
each class of equity Securities of the Borrower and each of
its Subsidiaries and the owners of such shares or interests.
None of such issued and outstanding equity Securities is
subject to any vesting, redemption, or repurchase agreement,
and there are no warrants or options (other than Permitted
Equity Securities Options) outstanding with respect to such
equity Securities. The outstanding equity Securities of the
Borrower and each of its Subsidiaries are duly authorized,
validly issued, fully paid and nonassessable free and clear
of any Liens, except for the Liens granted pursuant to the
Loan Documents, and are not Margin Stock.
(d) No Conflict. The execution, delivery and perfor-
mance of each of the Loan Documents to which the Borrower or
any of its Subsidiaries is a party do not and will not (i)
conflict with the Organizational Documents of the Borrower
or any such Subsidiary, (ii) constitute a tortious
interference with any Contractual Obligation of any Person
or conflict with, result in a breach of or constitute (with
or without notice or lapse of time or both) a default under
any Requirement of Law or Contractual Obligation of the
Borrower or any such Subsidiary, or require termination of
any Contractual Obligation, the consequences of which
violation, breach, default or termination, singly or in the
aggregate, will, or is reasonably likely to, result in a
Material Adverse Effect or may subject the Administrative
Agent, any of the Lenders or any of the Issuing Banks to any
liability, (iii) result in or require the creation or
imposition of any Lien whatsoever upon any of the Property
or assets of the Borrower or any such Subsidiary, other than
Liens contemplated by the Loan Documents, or (iv) require
any approval of the Borrower's or any such Subsidiary's
shareholders, which has not been obtained.
(e) Governmental Consents. Except as set forth on
Schedule 7.01-E attached hereto, the execution, delivery and
performance of each of the Loan Documents to which the
Borrower or any of its Subsidiaries is a party do not and
will not require any registration with, consent or approval
of, or notice to, or other action to, with or by any
Governmental Authority, except (i) filings, consents or
notices which have been made, obtained or given and (ii)
filings necessary to create or perfect security interests in
the Collateral.
(f) Governmental Regulation. Neither the Borrower,
nor any of its Subsidiaries is subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, or the Investment
Company Act of 1940, or any other federal or state statute
or regulation which limits its ability to incur indebtedness
or its ability to consummate the transactions contemplated
hereby or by the Loan Documents.
(g) Restricted Junior Payments. The Borrower has not
directly or indirectly declared, ordered, paid or made or
set apart any sum or Property for any Restricted Junior
Payment or agreed to do so, except as permitted pursuant to
Section 10.06 of this Agreement.
(h) Financial Position. Complete and accurate copies
of the following Financial Statements, materials and other
information have been delivered to the Administrative Agent:
(i) the Pro Forma and Projections and (ii) a statement as to
the TFC/RHI Liquidity as of the Closing Date. All Financial
Statements included in such materials were prepared in all
material respects in conformity with GAAP, except as
otherwise noted therein, and fairly present in all material
respects the respective consolidated financial positions,
and the consolidated results of operations and cash flows
for each of the periods covered thereby of the applicable
Person as at the respective dates thereof. Neither the
Borrower nor any of its Subsidiaries has any Accommodation
Obligation, contingent liability or liability for any taxes,
long-term leases or commitments, not disclosed in writing to
the Administrative Agent and the Lenders prior to the
Closing Date, which will have or is reasonably likely to
have a Material Adverse Effect.
(i) Pro Forma Financials. The Pro Forma, copies of
which have been furnished to the Lenders on the Closing
Date, fairly presents on a pro forma basis the financial
condition of the Operating Units as of the date designated
therein. The Projections and the assumptions expressed in
the Pro Forma are reasonable based on the information avail-
able to the Borrower at the time so furnished.
(j) Indebtedness; Refinanced Indebtedness. Schedule
1.01.5 sets forth all Indebtedness for borrowed money of the
Borrower and there are no defaults in the payment of
principal or interest on any such Indebtedness and no
payments thereunder have been deferred or extended beyond
their stated maturity (except as disclosed on such
Schedule). The Refinanced Indebtedness and all accrued and
unpaid interest thereon has been paid in full or provision
for payment has been made such that, in accordance with the
express provisions of the instruments governing such
Indebtedness, the Borrower has been or will be upon payment
in full of the Refinanced Indebtedness irrevocably released
from all liability and Contractual Obligations with respect
thereto other than customary continuing indemnities provided
for in the Contractual Obligation evidencing such Refinanced
Indebtedness, a copy of which has been delivered to the
Lenders. Any and all Liens securing the Refinanced
Indebtedness have been released or provision for release of
such Liens satisfactory to the Administrative Agent has been
made.
(k) Litigation; Adverse Effects. Except as set forth
in Schedule 7.01-K attached hereto, there is no action,
suit, proceeding, Claim, investigation or arbitration before
or by any Governmental Authority or private arbitrator
pending or, to the knowledge of the Borrower or any of its
Subsidiaries, threatened against VSI or FII (with respect to
which the Borrower or any of the Borrower's Subsidiaries may
have successor liability), TFC, RHI, the Borrower or any of
the Borrower's Subsidiaries or any of the Property (i)
challenging the validity or the enforceability of any of the
Loan Documents, (ii) which will, or is reasonably likely to,
result in any Material Adverse Effect, or (iii) under the
Racketeering Influenced and Corrupt Organizations Act or any
similar federal or state statute where such Person is a
defendant in a criminal indictment that provides for the
forfeiture of assets to any Governmental Authority as a
criminal penalty. There is no material loss contingency
within the meaning of GAAP which has not been reflected in
the Pro Forma or, after the Closing Date, the consolidated
Financial Statements of the Borrower. Neither VSI nor FII
was, prior to the Closing Date, nor are any of TFC, RHI, the
Borrower or any of its Subsidiaries (A) in violation of any
applicable Requirements of Law which violation will result,
or is reasonably likely to result, in a Material Adverse
Effect, or (B) subject to or in default with respect to any
final judgment, writ, injunction, restraining order or order
of any nature, decree, rule or regulation of any court or
Governmental Authority which will, or is reasonably likely
to, result in a Material Adverse Effect.
(l) No Material Adverse Effect. Since January 16,
1996, there has occurred no event with respect to VSI, FII
the Borrower or any Affiliate of the Borrower which has
resulted, or is reasonably likely to result, in a Material
Adverse Effect.
(m) Tax Examinations. The IRS has examined (or is
foreclosed from examining by applicable statutes) the
consolidated federal income tax returns of TFC for all tax
periods prior to and including the taxable year ending June
30, 1991. All deficiencies which have been asserted against
VSI or any of its Subsidiaries as a result of any federal,
state, local or foreign tax examination for each taxable
year in respect of which an examination has been conducted
have been fully paid or finally settled or are being
contested in good faith, and no issue has been raised in any
such examination which, by application of similar
principles, reasonably can be expected to result in
assertion of a material deficiency for any other year not so
examined which has not been reserved for in (i) VSI's
consolidated Financial Statements heretofore delivered to
the Administrative Agent and (ii) Borrower's consolidated
Financial Statements delivered to the Administrative Agent,
in each instance, to the extent, if any, required by GAAP.
Neither VSI nor the Borrower has taken any reporting
positions for which it does not have a reasonable basis and
does not anticipate any further material adverse tax
liability with respect to the years which have not been
closed pursuant to applicable law and which are not reserved
in the Financial Statements described above in clauses (i)
and (ii).
(n) Payment of Taxes. All tax returns and reports of
each of TFC, the Borrower and its Subsidiaries (or the
respective predecessors in interest of the Borrower and its
Subsidiaries) required to be filed have been timely filed,
and all taxes, assessments, fees and other charges of
Governmental Authorities thereupon and upon or relating to
their respective Property, assets, income and franchises
which are shown in such returns or reports to be due and
payable have been paid, except to the extent (i) such taxes,
assessments, fees and other charges are being contested in
good faith by an appropriate proceeding diligently pursued
as permitted by the terms of Section 9.04 and (ii) non-
payment of the amounts thereof would not, individually or in
the aggregate, result in a Material Adverse Effect. The
Borrower has no knowledge of any proposed tax assessment
against TFC, the Borrower or any of its Subsidiaries (or the
respective predecessors in interest of the Borrower and its
Subsidiaries) that will, or is reasonably likely to, result
in a Material Adverse Effect.
(o) Performance. None of the Borrower, any of its
Subsidiaries, or any predecessor in interest of the Borrower
or any of its Subsidiaries, has received any notice,
citation, or allegation, nor has actual knowledge, that
(i) it is in default in the performance, observance or
fulfillment of any of the obligations, covenants or
conditions contained in any Contractual Obligation
applicable to it, (ii) any Property of the Borrower or any
of its Subsidiaries is in violation of any Requirement of
Law, or (iii) any condition exists which, with the giving of
notice or the lapse of time or both, would constitute a
default with respect to any such Contractual Obligation, in
each case, except where such default or defaults, if any,
will not, or is not reasonably likely to, result in a
Material Adverse Effect.
(p) Disclosure. The representations and warranties of
the Borrower and its Subsidiaries contained in the Loan
Documents, and all certificates and other documents
delivered to the Administrative Agent pursuant to the terms
thereof, do not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to
make the statements contained herein or therein, in light of
the circumstances under which they were made, not
misleading. The Borrower has not intentionally withheld any
fact from the Administrative Agent, the Issuing Banks or the
Lenders in regard to any matter which will, or is reasonably
likely to, result in a Material Adverse Effect.
(q) Requirements of Law. The Borrower and each of its
Subsidiaries, respectively, are in compliance with all
Requirements of Law applicable to them and their respective
businesses, in each case where the failure to so comply
individually or in the aggregate will, or is reasonably
likely to, result in a Material Adverse Effect.
(r) Environmental Matters. (i) Except as disclosed on
Schedule 7.01-R attached hereto:
(A) neither Borrower nor any Domestic Subsidiary of the
Borrower (or any of their respective predecessors in
interest) has received any unresolved notice from any
federal, state or local agency to the effect that its
operations are not in compliance with any applicable
Environmental, Health or Safety Requirements of Law or the
subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a
Release of a Contaminant into the environment;
(B) to the knowledge of the Borrower, none of the
Borrower or its Domestic Subsidiaries (or any of their
respective predecessors in interest) or any of its their
respective present or past Property or operations, are
subject to or the subject of any judicial or administrative
proceeding, order, judgment, decree, dispute, negotiations,
agreement, or settlement respecting (I) any Environmental,
Health or Safety Requirements of Law, (II) any Remedial
Action, (III) any Claims or Liabilities and Costs arising
from the Release or threatened Release of a Contaminant into
the environment, or (IV) any violation of or liability under
any Environmental, Health or Safety Requirement of Law that
Borrower or its Domestic Subsidiaries reasonably believe
will result in a material expenditure of money;
(C) none of the Borrower, any of its Domestic
Subsidiaries, or any of their respective predecessors in
interest has filed any notice under any applicable
Requirement of Law (I) reporting a Release of a Contaminant
where remedial action has not been conducted to the
satisfaction of the appropriate Governmental Authority; or
(II) reporting a violation of any applicable Environmental,
Health or Safety Requirement of Law where such violation has
not been corrected to the satisfaction of the appropriate
Governmental Authority;
(D) none of the Borrower's or its Domestic
Subsidiaries' present or past Property is listed or, to the
knowledge of the Borrower, proposed for listing on the
National Priorities List ("NPL") pursuant to CERCLA or on
the Comprehensive Environmental Response Compensation
Liability Information System List ("CERCLIS") or any similar
state list of sites requiring Remedial Action;
(E) to the knowledge of the Borrower, neither the
Borrower nor any of its Domestic Subsidiaries has any
material contingent liability in connection with any Release
or threatened Release of any Contaminants into the
environment; and
(F) no Environmental Lien has attached to any
Property.
(ii) the Borrower and each of its Domestic
Subsidiaries are conducting and will continue to conduct
their respective business and operations in an
environmentally responsible manner in material compliance
with Environmental, Health or Safety Requirements of Law,
and the Borrower and its Subsidiaries, taken as a whole,
have not been, and have no reason to believe that they will
be, subject to Liabilities and Costs arising out of or
relating to environmental, health or safety matters that
have or will result in material cash expenditures by the
Borrower and its Domestic Subsidiaries in the aggregate for
the Fiscal Year ending June 30, 1996 in excess of the
reserves established therefor.
(s) ERISA. Except as disclosed on Schedule 7.01-S
attached hereto, (i) neither the Borrower nor any of
Borrower's Subsidiaries contributes to any Benefit Plan,
Multiemployer Plan or Foreign Pension Plan, (ii) no ERISA
Event has occurred or is reasonably expected to occur that
has resulted or is reasonably likely to result in a material
liability of the Borrower or any Subsidiary of the Borrower,
(iii) Schedule B (Actuarial Information) to the 1994 annual
report (Form 5500 Series) for each Benefit Plan, copies of
which have been filed with the Internal Revenue Service and
furnished to the Administrative Agent, is complete and
accurate and fairly presents the funding status of such
Benefit Plan, and since the date of such Schedule B there
has been no material adverse change in such funding status,
(iv) neither the Borrower nor any ERISA Affiliate has
incurred or is reasonably expected to incur any withdrawal
liability to any Multiemployer Plan, (v) neither the
Borrower nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan
is in reorganization or has been terminated, within the
meaning of Title IV of ERISA, and no Multiemployer Plan is
reasonably expected to be in reorganization or to be
terminated, within the meaning of Title IV of ERISA, and
(vi) the aggregate annualized cost (including, without
limitation, the cost of insurance premiums) with respect to
post-retirement benefits under Benefit Plans for which the
Borrower is liable does not exceed $5,000,000.
(t) Foreign Employee Benefit Matters. Each Foreign
Employee Benefit Plan is in compliance in all material
respects with all laws, regulations and rules applicable
thereto and the respective requirements of the governing
documents for such Plan. The aggregate of the liabilities
to provide all of the accrued benefits under any Foreign
Pension Plan does not exceed the current Fair Market Value
of the assets held in the trust or other funding vehicle for
such Plan. With respect to any Foreign Employee Benefit
Plan maintained or contributed to by the Borrower, any of
its Subsidiaries or any ERISA Affiliate (other than a
Foreign Pension Plan), reasonable reserves have been
established in accordance with prudent business practice or
where required by ordinary accounting practices in the
jurisdiction in which such Plan is maintained. The
aggregate unfunded liabilities, after giving effect to any
reserves for such liabilities, with respect to such Plans
does not exceed the current fair market value of the assets
held in the trust or other funding vehicle for such Plan.
There are no actions, suits or claims (other than routine
claims for benefits) pending or, to the best knowledge of
the Borrower, threatened against the Borrower, any of its
Subsidiaries or any ERISA Affiliate with respect to any
Foreign Employee Benefit Plan.
(u) Labor Matters. Schedule 7.01-U accurately sets
forth all labor contracts to which the Borrower or any of
its Subsidiaries is a party on the date hereof and the
expiration date of each such contract. There are no
strikes, lockouts or other grievances relating to any
collective bargaining or similar agreement to which the
Borrower or any of its Subsidiaries is a party.
(v) Securities Activities. Neither the Borrower nor
any of its Subsidiaries is engaged in the business of
extending credit for the purpose of purchasing or carrying
Margin Stock.
(w) Solvency. After giving effect to the Loans to be
made and Letters of Credit to be issued on the Closing Date
or such other date as Loans requested hereunder are made or
Letters of Credit requested hereunder are issued, and the
disbursement of the proceeds of such Loans pursuant to the
Borrower's instructions, the Borrower is and each of its
Subsidiaries are Solvent.
(x) Patents, Trademarks, Permits, Etc.; Government
Approvals. (i) The Borrower and each of its Subsidiaries,
as applicable, owns, is licensed or otherwise has the lawful
right to use, or has all Permits and other governmental
approvals, patents, trademarks, trade names, copyrights,
technology, know-how, permits and processes used in or
necessary for the conduct of its respective business as
currently conducted which are material to its condition
(financial or otherwise), operations, performance and
prospects, taken as a whole. Except as set forth on
Schedule 7.01-X attached hereto, no claims are pending or,
to the best of Borrower's knowledge following diligent
inquiry, threatened that the Borrower or any of its
Subsidiaries is infringing or otherwise adversely affecting
the rights of any Person with respect to such Permits and
other governmental approvals, patents, trademarks, trade
names, copyrights, technology, know-how, permits and
processes, except for such claims and infringements as do
not, in the aggregate, give rise to any liability on the
part of the Borrower or any of its Subsidiaries which will,
or is reasonably likely to, result in a Material Adverse
Effect.
(ii) The consummation of the transactions contemplated
by the Transfer Documents and Loan Documents will not impair
the ownership of or rights under (or the license or other
right to use, as the case may be) any Permits and
governmental approvals, patents, trademarks, trade names,
copyrights, technology, know-how, permits or processes by
the Borrower or any of its Subsidiaries in any manner which
will, or is reasonably likely to, result in a Material
Adverse Effect.
(y) Assets and Properties. The Borrower and each of
its Subsidiaries has good and marketable title to all of the
assets and Property (tangible and intangible) owned by it
(except insofar as marketability may be limited by any laws
or regulations of any Governmental Authority affecting such
assets), and all such assets and Property are free and clear
of all Liens except Liens securing the Obligations and Liens
permitted under Section 10.03. Substantially all of the
assets and Property owned by, leased to, or used by the
Borrower and/or each such Subsidiary of the Borrower is in
adequate operating condition and repair, ordinary wear and
tear excepted, is free and clear of any known defects except
such defects as do not substantially interfere with the
continued use thereof in the conduct of normal operations,
and is able to serve the function for which they are
currently being used, except in each case where the failure
of such asset to meet such requirements would not, or is not
reasonably likely to, result in a Material Adverse Effect.
Neither this Agreement nor any other Loan Document, nor any
transaction contemplated under any such agreement, will
affect any right, title or interest of the Borrower or any
Subsidiary of the Borrower in and to any of such assets in a
manner that would, or is reasonably likely to, result in a
Material Adverse Effect.
(z) Insurance. Schedule 7.01-Z attached hereto
accurately sets forth as of the Closing Date all insurance
policies and programs currently in effect with respect to
the respective Property and assets and business of the
Borrower and its Subsidiaries, specifying for each such
policy and program, (i) the amount thereof, (ii) the risks
insured against thereby, (iii) the name of the insurer and
each insured party thereunder, (iv) the policy or other
identification number thereof, and (v) the expiration date
thereof. Borrower has delivered to the Administrative Agent
copies of all such insurance policies. Such insurance
policies and programs are currently in full force and
effect, in compliance with the requirements of Section 9.05
and are in amounts sufficient to cover the replacement value
of the respective Property and assets of the Borrower and
its Subsidiaries.
(aa) Asset Transfers. All conditions precedent to,
and all consents necessary to the Transfer Documents'
becoming effective, have been satisfied or delivered, or
waived with the prior written consent of the Requisite
Lenders, and no material breach of any term or provision of
the Transfer Documents has occurred and no action has been
taken by any competent authority which restrains, prevents
or imposes material adverse conditions upon, or seeks to
restrain, prevent or impose material adverse conditions
upon, the effectiveness of the Transfer Documents.
(bb) Pledge of Capital Stock. The grant and
perfection of the security interest in the Capital Stock of
the Subsidiaries of the Borrower constituting a portion of
the Collateral for the benefit of the Holders, as
contemplated by the terms of the Loan Documents, is not made
in violation of the registration provisions of the Securi-
ties Act, any applicable provisions of other federal securi-
ties laws, state securities or "Blue Sky" law, foreign
securities law, or applicable general corporation law or in
violation of any other Requirement of Law.
ARTICLE VIII
REPORTING COVENANTS
The Borrower covenants and agrees that so long as any
Commitments are outstanding and thereafter until payment in
full of all of the Obligations (other than indemnities not
yet due), unless the Requisite Lenders shall otherwise give
their prior written consent thereto:
8.01. Financial Statements; Communications with
Accountants. (a) Monthly Financial Reports. The Borrower
shall maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and
administered in accordance with sound business practices to
permit preparation of consolidated Financial Statements in
conformity with GAAP and each of the Financial Statements
described below shall be prepared from such system and
records. The Borrower shall deliver or cause to be
delivered to the Administrative Agent and the Lenders (i)
consolidated balance sheets of each Operating Unit and the
related consolidated statements of income as soon as
practicable, and in any event by May 25, 1996 with respect
to the quarter ending March 31, 1996, (ii) consolidated
balance sheets of each Operating Unit and the related
consolidated statements of income as soon as practicable,
and in any event within fifty-five (55) days after April 28,
1996 and May 26, 1996, in each instance for the month then
ending, and (iii) consolidated and consolidating balance
sheets of TFC and its Subsidiaries and related consolidated
and consolidating statements of income, cash flow and
stockholders' equity as soon as practicable, and in any
event by May 25, 1996 for the quarter ending March 31, 1996.
An Officer's Certificate of the Borrower substantially in
the form of Exhibit I attached hereto and made a part hereof
shall accompany the Financial Statements referenced in
clauses (i) and (ii) above certifying that such Financial
Statements fairly present the consolidated financial
position of the respective Operating Units as at the dates
indicated and the results of their operations for the
periods indicated in accordance with GAAP, subject to normal
year end adjustments, and stating that the chief financial
officer of the Borrower signatory thereto has reviewed the
terms of the Loan Documents, and has made, or caused to be
made under his/her supervision, a review in reasonable
detail of the transactions and consolidated financial
condition of the Operating Units during the accounting
period covered by such Financial Statements, that such
review has not disclosed the existence during or at the end
of such accounting period, and that such Person does not
have knowledge of the existence as at the date of such
Officer's Certificate, of any condition or event which
constitutes an Event of Default or Potential Event of
Default, or, if any such condition or event existed or
exists, specifying the nature and period of existence
thereof and what action the Borrower or any of its
Subsidiaries has taken, is taking and proposes to take with
respect thereto. Such Financial Statements shall also be
accompanied by a certificate (the "Compliance Certificate"),
signed by the Borrower's chief financial officer, setting
forth calculations (with such specificity as the
Administrative Agent may reasonably request) for the period
then ended which demonstrate compliance, when applicable,
with the provisions of Article XI, including, without
limitation, the amount of Capital Expenditures made, on a
cumulative basis, since the Closing Date.
(b) Other Financial Information. With reasonable
promptness, Borrower shall deliver such other information,
reports, filings, projections, business plans and data with
respect to Borrower and its Subsidiaries as from time to
time may be reasonably requested by any Lender.
(c) Communications with Accountants. Borrower
authorizes (i) the Administrative Agent, after giving
Borrower reasonable prior written notice of its intent to do
so, to communicate directly with Borrower's independent
certified public accountants concerning the Financial
Statements; provided that Borrower is not precluded by the
Administrative Agent from being present for such
communication and (ii) such independent certified public
accountants, upon the Administrative Agent's written request
with a copy to Borrower, to provide to the Administrative
Agent copies of any financial schedules prepared by such
accountants for Borrower.
8.02. Events of Default. Promptly upon any of the
chief executive officer, chief operating officer, chief
financial officer, or treasurer of the Borrower obtaining
knowledge (a) of any condition or event which constitutes an
Event of Default or Potential Event of Default, or becoming
aware that any Lender or the Administrative Agent has given
any notice with respect to a claimed Event of Default or
Potential Event of Default under this Agreement, (b) that
any Person has given any notice to the Borrower or any
Subsidiary of the Borrower or taken any other action with
respect to a claimed default or event or condition of the
type referred to in Section 12.01(e), or (c) of any
condition or event which has resulted, or is reasonably
likely to result, in a Material Adverse Effect or affect the
value of, or the Administrative Agent's interest in, the
Collateral in any material respect, the Borrower shall
deliver to the Administrative Agent and the Lenders an
Officer's Certificate specifying (i) the nature and period
of existence of any such claimed default, Event of Default,
Potential Event of Default, condition or event, (ii) the
notice given or action taken by such Person in connection
therewith, and (iii) what action the Borrower has taken, is
taking and proposes to take with respect thereto.
8.03. Lawsuits. Promptly upon the Borrower obtaining
knowledge of the institution of, or written threat of, any
action, suit, proceeding, governmental investigation or
arbitration against or affecting the Borrower or any of its
Subsidiaries or any of the Property not previously disclosed
pursuant to Section 7.01(k), which action, suit, proceeding,
governmental investigation or arbitration exposes, or in the
case of multiple actions, suits, proceedings, governmental
investigations or arbitrations arising out of the same
general allegations or circumstances which expose, in the
Borrower's reasonable judgment, the Borrower and/or any of
its Subsidiaries to liability in an amount aggregating
$500,000 or more (exclusive of claims covered by insurance
policies of the Borrower and its Subsidiaries unless the
insurers of such claims have disclaimed coverage or reserved
the right to disclaim coverage on such claims), the Borrower
shall give written notice thereof to the Administrative
Agent and the Lenders and provide such other information as
may be reasonably available to enable each Lender and the
Administrative Agent and its counsel to evaluate such
matters. The Borrower upon request of the Administrative
Agent or the Requisite Lenders shall promptly give written
notice of the status of any action, suit, proceeding,
governmental investigation or arbitration covered by a
report delivered in accordance herewith and provide such
other information as may be reasonably available to it to
enable each Lender and the Administrative Agent and its
counsel to evaluate such matters.
8.04. Declaration of Dividends and Other
Distributions. Borrower shall provide to the Administrative
Agent written notification (or telephonic notice promptly
confirmed in writing) of a dividend or other distribution to
be made on Borrower's Capital Stock no less than sixty (60)
days prior to the payment date for such dividend or other
distribution; provided, however, that Lenders acknowledge
that a loan in the amount of DM 4,923,000 made by Fairchild
Convac GmbH to RHI prior to the merger on February 26, 1996
of Fairchild Convac GmbH with and into D-M-E Normalien GmbH
is anticipated to be recharacterized during the term of this
Agreement as a dividend and notice of such
recharacterization shall be required only upon the same
becoming effective.
8.05. TFC/RHI Liquidity. The Borrower shall deliver
to the Administrative Agent and the Lenders, within ten (10)
days after March 31, 1996, an Officer's Certificate in the
form of Exhibit J attached hereto setting forth the
calculation of the TFC/RHI Liquidity as of March 31, 1996.
8.06. Environmental Notices. The Borrower shall
notify the Administrative Agent and the Lenders in writing,
promptly upon the Borrower's learning thereof, of any:
(i) notice or claim to the effect that the Borrower or
any Subsidiary of the Borrower is subject to investigation
or may be subject to investigation or liable to any Person
as a result of the Release or threatened Release of any
Contaminant into the environment which could reasonably
result in an expenditure over $2,000,000;
(ii) notice that any Property is subject to an
Environmental Lien; and
(iii) notice to the Borrower or any Subsidiary of the
Borrower of any material violation of any Environmental,
Health or Safety Requirement of Law or the commencement or
threat of any judicial or administrative proceeding alleging
such a material violation by the Borrower or any Subsidiary
of the Borrower.
8.07. Other Reports. The Borrower shall deliver or
cause to be delivered to the Administrative Agent and the
Lenders copies of all Financial Statements, reports and
notices, if any, sent or made available generally by TFC,
RHI, or the Borrower to its Securities holders or filed with
the Commission and all press releases made available
generally by TFC, RHI, the Borrower or any Subsidiary of the
Borrower to the public concerning material developments in
the business of the Borrower or any such Subsidiary of the
Borrower, and all notifications received by the Borrower or
any Subsidiary of the Borrower pursuant to the Securities
Exchange Act and the rules promulgated thereunder.
8.08. Other Information. Promptly upon receiving a
request therefor from the Administrative Agent or the
Requisite Lenders, the Borrower shall prepare and deliver to
the Administrative Agent and the Lenders such other
information with respect to the Borrower, any of its
Subsidiaries, or the Collateral, including, without
limitation, schedules identifying and describing the
Collateral and any dispositions thereof, as from time to
time may be reasonably requested by the Administrative Agent
or the Requisite Lenders.
ARTICLE IX
AFFIRMATIVE COVENANTS
Borrower covenants and agrees that so long as any
Commitments are outstanding and thereafter until payment in
full of all of the Obligations (other than indemnities not
yet due), unless the Requisite Lenders shall otherwise give
prior written consent:
9.01. Corporate Existence, Etc. The Borrower shall,
and shall cause each of its Subsidiaries to, at all times
maintain its corporate existence and preserve and keep, or
cause to be preserved and kept, in full force and effect its
rights and franchises material to its businesses, except
where the loss or termination of such rights and franchises
is not likely to result in a Material Adverse Effect.
9.02. Corporate Powers; Conduct of Business. The
Borrower shall, and shall cause each of its Subsidiaries to,
qualify and remain qualified to do business and maintain its
good standing in each jurisdiction in which the nature of
its business and the ownership of its Property requires it
to be so qualified and in good standing.
9.03. Compliance with Laws, Etc. The Borrower shall,
and shall cause each of its Subsidiaries to, (a) comply with
all Requirements of Law and all restrictive covenants
affecting it or its business, Property, assets or operations
and (b) obtain as needed all Permits necessary for its
operations and maintain such Permits in good standing,
except in the case where noncompliance with either clause
(a) or (b) above is not reasonably likely to result in a
Material Adverse Effect.
9.04. Payment of Taxes and Claims; Tax Consolidation.
The Borrower shall, and shall cause each of its Subsidiaries
to, pay (a) all taxes, assessments and other governmental
charges imposed upon it or on any of its Property or assets
or in respect of any of its franchises, business, income or
Property before any penalty or interest accrues thereon, and
(b) all Claims (including, without limitation, claims for
labor, services, materials and supplies) for sums which have
become due and payable and which by law have or may become a
Lien (other than a Lien permitted by Section 10.03) upon any
of the Borrower's or such Subsidiary's Property or assets,
prior to the time when any penalty or fine shall be incurred
with respect thereto; provided, however, that no such taxes,
assessments and governmental charges referred to in clause
(a) above or Claims referred to in clause (b) above need be
paid if being contested in good faith by appropriate pro-
ceedings diligently instituted and conducted and if such
reserve or other appropriate provision, if any, as shall be
required in conformity with GAAP shall have been made
therefor. The Borrower will not, nor will it permit any of
its Subsidiaries to, file or consent to the filing of any
consolidated income tax return with any Person (other than
TFC and its Subsidiaries).
9.05. Insurance. The Borrower shall maintain for
itself and its Subsidiaries, or shall cause each of its
Subsidiaries to maintain in full force and effect the
insurance policies and programs listed on Schedule 7.01-Z or
substantially similar policies and programs or other
policies and programs as are acceptable to the
Administrative Agent. All such policies and programs shall
be maintained with responsible and reputable insurance
companies engaged in similar businesses and owning similar
property in the same general geographic areas in which the
Borrower and/or its Subsidiaries operate. Each certificate
and policy relating to Property damage, boiler and machinery
and/or business interruption coverage shall contain an
endorsement, in form and substance acceptable to the
Administrative Agent, showing loss payable to the
Administrative Agent, for the benefit of the Holders, and,
if required by the Administrative Agent, naming the
Administrative Agent as an additional insured under such
policy. Each certificate and policy relating to coverage
other than the foregoing shall, if required by the
Administrative Agent, contain an endorsement naming the
Administrative Agent as an additional insured or mortgagee
payee, as applicable, under such policy. Such endorsement
or an independent instrument furnished to the Administrative
Agent shall provide that the insurance companies will give
the Administrative Agent at least thirty (30) days' written
notice before any such policy or policies of insurance shall
be altered adversely to the interests of the Holders or
cancelled and that no act, whether willful or negligent, or
default of the Borrower, any of its Subsidiaries or any
other Person shall affect the right of the Administrative
Agent to recover under such policy or policies of insurance
in case of loss or damage. In the event the Borrower or any
of its Subsidiaries, at any time or times hereafter shall
fail to obtain or maintain any of the policies or insurance
required herein or to pay any premium in whole or in part
relating thereto, then the Administrative Agent, without
waiving or releasing any obligations or resulting Event of
Default hereunder, may at any time or times thereafter (but
shall be under no obligation to do so) obtain and maintain
such policies of insurance and pay such premiums and take
any other action with respect thereto which the
Administrative Agent deems advisable. All sums so disbursed
by the Administrative Agent shall constitute Protective
Advances hereunder and be part of the Obligations, payable
as provided in this Agreement.
9.06. Inspection of Property; Books and Records;
Discussions. The Borrower shall, and shall cause each of
its Subsidiaries to, permit any authorized representative(s)
designated by either the Administrative Agent or any Lender
to visit and inspect, whether by access to Borrower's and
its Subsidiaries' MIS or otherwise, any of the Property, to
examine, audit, check and make copies of its respective
financial and accounting records, books, journals, orders,
receipts and any correspondence (other than privileged
correspondence with legal counsel) and other data relating
to their respective businesses or the transactions
contemplated hereby or referenced herein (including, without
limitation, in connection with environmental compliance,
hazard or liability), and to discuss their affairs, finances
and accounts with their officers, management personnel, and
independent certified public accountants, all upon
reasonable written notice and at such reasonable times
during normal business hours, as often as may be reasonably
requested. Each such visitation and inspection (i) by or on
behalf of any Lender shall be at such Lender's expense and
(ii) by or on behalf of the Administrative Agent shall be at
the Borrower's expense. The Borrower shall keep and
maintain, and cause each of its Subsidiaries to keep and
maintain, in all material respects on its MIS and otherwise
proper books of record and account in which entries in
conformity with GAAP shall be made of all dealings and
transactions in relation to its respective businesses and
activities, including, without limitation, transactions and
other dealings with respect to the Collateral. If an Event
of Default has occurred and is continuing, the Borrower,
upon the Administrative Agent's request, shall, and shall
cause each of its Subsidiaries to, turn over any such
records to the Administrative Agent or its representatives;
provided, however, that the Borrower may, in its discretion,
retain copies of such records.
9.07. Insurance and Condemnation Proceeds. (a)
Direction to Insurers. The Borrower hereby directs (and, if
applicable, shall cause its Subsidiaries to direct) all
insurers under policies of Property damage, boiler and
machinery and business interruption insurance and payors of
any condemnation claim or award relating to the Property to
pay all proceeds payable under such policies or with respect
to such claim or award directly to the Administrative Agent,
for the benefit of the Administrative Agent, the Issuing
Banks and the Lenders. In no case shall such proceeds be
payable to the Borrower or one or more of its Subsidiaries
and the Administrative Agent.
(b) Application of Proceeds. The Administrative Agent
shall, upon receipt of such proceeds, apply all of the
proceeds so received in repayment of the Obligations in the
manner set forth in Section 4.01(b)(vi). Notwithstanding the
foregoing, in the event proceeds of insurance received by
the Administrative Agent under property damage, boiler and
machinery policies or business interruption insurance
policies (i) is less than $250,000 or (ii) constitutes
Replacement Proceeds, the Administrative Agent shall, upon
receipt of such proceeds, remit the amount so received to
the Borrower or a Subsidiary of the Borrower, as applicable
provided that there shall not then exist an Event of Default
which is continuing unwaived.
9.08. ERISA Compliance. The Borrower shall, and shall
cause each of its Subsidiaries and ERISA Affiliates to,
establish, maintain and operate all Plans to comply in all
material respects with the provisions of ERISA, the Internal
Revenue Code, all other applicable laws, and the regulations
and interpretations thereunder and the respective
requirements of the governing documents for such Plans.
9.09. Foreign Employee Benefit Plan Compliance. The
Borrower shall, and shall cause each of its Subsidiaries and
ERISA Affiliates to, establish, maintain and operate all
Foreign Employee Benefit Plans to comply in all material
respects with all laws, regulations and rules applicable
thereto and the respective requirements of the governing
documents for such Plans.
9.10. Collection Accounts. Within thirty (30) days
after the Closing Date, the Borrower shall, and shall cause
each of its Domestic Subsidiaries to, enter into Collection
Account Agreements with respect to each of their respective
depository accounts into which collections of Receivables
and other proceeds of Collateral are deposited or, to the
extent collection account agreements were executed and
delivered in connection with the 1992 Credit Agreement, to
amend such agreements on terms satisfactory to the
Administrative Agent to become a Collection Account
Agreement.
9.11. Maintenance of Property. The Borrower shall,
and shall cause each of its Subsidiaries to, maintain in all
material respects all of its respective owned and leased
Property in good, safe and insurable condition and repair,
and not permit, commit or suffer any waste or abandonment of
any such Property and from time to time shall make or cause
to be made all material repairs, renewal and replacements
thereof, including, without limitation, any capital
improvements which may be required; provided, however, that
such Property may be altered or renovated in the ordinary
course of Borrower's or its Subsidiaries' business.
9.12. Condemnation. Immediately upon learning of the
institution of any proceeding for the condemnation or other
taking of any of the owned or leased Real Property of the
Borrower or any Subsidiary of the Borrower, the Borrower
shall notify the Administrative Agent of the pendency of
such proceeding, and permit the Administrative Agent to
participate in any such proceeding, and from time to time
will deliver to the Administrative Agent all instruments
reasonably requested by the Administrative Agent to permit
such participation.
9.13. Tax Allocation Agreement. Borrower shall
maintain or cause to be maintained, in full force and
effect, the Tax Allocation Agreement, without amendment or
modification unless consented to by the Requisite Lenders.
9.14. Performance of Material Contracts. Borrower
shall, and shall cause each of its Subsidiaries to, perform
and observe all the terms and provisions of each material
Contractual Obligation to be performed or observed by it,
maintain each such material Contractual Obligation in full
force and effect, enforce each such material Contractual
Obligation in accordance with its terms, take all such
action to such end as may be from time to time requested by
the Administrative Agent and, upon request of the
Administrative Agent, make to each other party to each such
material Contractual Obligation such demands and requests
for information and reports or for action as the Borrower or
such Subsidiary is entitled to make under such material
Contractual Obligation.
9.15. CM Note and CM Letter of Credit. Borrower shall
exercise, on June 28, 1996, its right to demand payment of
the Indebtedness evidenced by the CM Notes and such demand
shall be for payment of such Indebtedness by no later than
July 29, 1996. Borrower shall exercise, no later than July
29, 1996, its right to draw on the CM Letter of Credit.
9.16. Real Property. Borrower shall obtain, upon the
request of the Administrative Agent, surveys of owned or
leased Real Property which is part of the Collateral and
title commitments for title insurance policies in form and
substance and from title insurers satisfactory to the
Administrative Agent with respect to mortgages and leasehold
mortgages of Real Property and/or interests in Real Property
which is part of the Collateral for the benefit of the
Administrative Agent, the Issuing Banks and the Lenders.
ARTICLE X
NEGATIVE COVENANTS
Borrower covenants and agrees that it shall comply with
the following covenants so long as any Commitments are out-
standing and thereafter until payment in full of all of the
Obligations (other than indemnities not yet due), unless the
Requisite Lenders shall otherwise give prior written
consent:
10.01. Indebtedness. The Borrower shall not and shall
not permit any of its Subsidiaries to directly or indirectly
create, incur, assume or otherwise become or remain directly
or indirectly liable with respect to any Indebtedness,
except:
(a) the Obligations;
(b) Indebtedness for trade payables, wages and other
accrued expenses incurred in the ordinary course of
business;
(c) the Transaction Costs which have not been paid on
or as of the Closing Date;
(d) Permitted Existing Indebtedness and any
extensions, renewals, refundings or replacements thereof,
provided that any such extension, renewal, refunding or
replacement is in an aggregate principal amount not greater
than the principal amount of, and is on terms no less
favorable to the Borrower or its Subsidiary than the terms
of, the Permitted Existing Indebtedness so extended,
renewed, refunded or replaced;
(e) to the extent permitted by Article XI and in any
event in an aggregate amount not to exceed $1,000,000 at any
time, Capital Leases and purchase money Indebtedness
incurred to finance the acquisition of fixed assets, and
Indebtedness incurred to refinance such Capital Leases and
purchase money Indebtedness; provided, however, prior to
incurring Capital Lease obligations owing to any one lessor
or group of affiliated or related lessors or purchase money
Indebtedness owing to any one holder or group of affiliated
or related holders thereof, which in either case
aggregate(s) more than $750,000, the Borrower shall obtain,
or cause such Subsidiary to obtain, from such lessor(s) or
holder(s) a duly executed intercreditor agreement in form
and substance satisfactory to the Administrative Agent;
(f) Indebtedness in respect of taxes, assessments,
governmental charges and Claims for labor, materials or
supplies, to the extent that payment thereof is not required
pursuant to Section 9.04;
(g) Indebtedness constituting Accommodation
Obligations permitted by Section 10.05;
(h) Indebtedness arising from intercompany loans from
the Borrower to any of its Subsidiaries which is a Guarantor
or from any such Subsidiary to the Borrower or any other
such Subsidiary;
(i) Indebtedness in respect of profit sharing plans to
the extent permitted under Section 10.04;
(j) Indebtedness in respect of the Hedge Agreements in
respect of interest rates or foreign exchange contracts
containing terms reasonably acceptable to the Administrative
Agent and purchased from a Lender, an Affiliate of a Lender
or such other Person reasonably acceptable as a credit
matter to the Administrative Agent;
(k) Indebtedness with respect to reasonable warranties
and indemnities made under any agreements for asset sales
permitted under Section 10.02 and Contractual Obligations of
the Borrower or any Subsidiary of the Borrower entered into
in the ordinary course of its business;
(l) Indebtedness under appeal bonds in connection with
judgments which do not result in an Event of Default or a
Potential Event of Default or any other breach hereunder,
provided that the aggregate amount of all such Indebtedness
does not exceed $1,000,000; and
(m) in addition to the Indebtedness permitted by
clauses (a) through (l) above, other unsecured Indebtedness
in an aggregate amount which, when combined with outstanding
Accommodation Obligations permitted under Section 10.05(d),
does not to exceed $5,000,000 outstanding.
10.02. Sales of Assets. The Borrower shall not and
shall not permit any of its Subsidiaries to sell, assign,
transfer, lease, convey or otherwise dispose of any
Property, whether now owned or hereafter acquired, or any
income or profits therefrom, or enter into any agreement to
do so, except:
(a) the sale of Property for consideration not less
than the Fair Market Value thereof so long as (i) any non-
cash consideration resulting from such sale shall be pledged
or assigned to the Administrative Agent, for the benefit of
the Holders, pursuant to an instrument in form and substance
acceptable to the Administrative Agent and (ii) the Borrower
complies with the mandatory prepayment provisions set forth
in Section 4.01(b) and the conditions to the release of
Collateral described in Section 13.09(c);
(b) the sale of Inventory in the ordinary course of
Borrower's and its Subsidiaries respective businesses;
(c) the disposition of Equipment if such Equipment is
traded in for credit against the purchase price of
replacement Equipment or the proceeds of such disposition
are reasonably promptly applied to the purchase price of
such replacement Equipment, is obsolete, or is no longer
useful in the ordinary course of the Borrower's or such
Subsidiary's business;
(d) the sale of Investments in Cash Equivalents
permitted pursuant to Section 10.04(a); and
(e) the sale of Excluded Dispositions.
10.03. Liens. The Borrower shall not and shall not
permit any of its Subsidiaries to directly or indirectly
create, incur, assume or permit to exist any Lien or
negative pledge on or with respect to any of their
respective Property or assets except:
(a) Liens created pursuant to the Loan Documents;
(b) Permitted Existing Liens; and
(c) Customary Permitted Liens.
10.04. Investments. The Borrower shall not and shall
not permit any of its Subsidiaries to directly or indirectly
make or own any Investment except:
(a) Investments in Cash Equivalents;
(b) Permitted Existing Investments, in each case
increased or decreased as required under GAAP as a result of
annual adjustments made to Investments accounted for under
the equity method;
(c) Investments in the form of advances to employees
in the ordinary course of business for moving, relocation
and travel expenses;
(d) Investments received in connection with the bankruptcy
or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes
with, customers and suppliers arising in the ordinary course
of business;
(e) Investments by the Borrower in its Subsidiaries
which, if in the form of intercompany loans, would be
permitted under Section 10.01(h);
(f) an Investment by (i) the Borrower, VSI Holdings,
Inc. or Convac in connection with the acquisition of an
additional thirty percent (30%) of the issued and
outstanding Capital Stock of Voi-Shan Diessel GmbH, a
Subsidiary of VSI Holdings, Inc. and (ii) Convac in up to
sixty-nine percent (69%) of the seventy percent (70%) of the
issued and outstanding Capital Stock of Voi-Shan Diessel
GmbH owned, as of the Closing Date, by VSI Holdings, Inc.;
(f) Investments in the form of intercompany loans made
by the Borrower or its Subsidiaries to RHI or TFC prior to
the occurrence of an Event of Default or Potential Event of
Default; and
(g) Investments in an aggregate amount not to exceed
$2,500,000 made in connection with acquisitions of assets or
Capital Stock of any Person engaged in a business
substantially similar to a business in which Borrower and
its Subsidiaries are engaged as of the Closing Date;
provided that after giving effect to the making of such
Investment, no Potential Event of Default or Event of
Default would occur.
10.05. Accommodation Obligations. The Borrower shall
not and shall not permit any of its Subsidiaries to directly
or indirectly create or become or be liable with respect to
any Accommodation Obligation, except:
(a) recourse obligations resulting from endorsement of
negotiable instruments for collection in the ordinary course
of its business;
(b) Permitted Existing Accommodation Obligations and
any extensions, renewals or replacements thereof, provided
that the aggregate Indebtedness under any such extension,
renewal or replacement is not greater than the Indebtedness
under, and shall be on terms no less favorable to the
Borrower or such Subsidiary than the terms of, the Permitted
Existing Accommodation Obligation so extended, renewed or
replaced;
(c) Accommodation Obligations arising under the Loan
Documents; and
(d) in addition to the Accommodation Obligations
permitted by clauses (a) through (c) above, other unsecured
Accommodation Obligations in an aggregate amount which, when
combined with outstanding Indebtedness permitted by Section
10.01(m), does not exceed $5,000,000 at any time
outstanding.
10.06. Restricted Junior Payments. The Borrower shall
not and shall not permit any of its Subsidiaries to declare
or make any Restricted Junior Payment, except:
(a) dividends or distributions to the Borrower on the
Capital Stock of any of its Wholly-Owned Subsidiaries or to
any of the Borrower's Wholly-Owned Subsidiaries from any
other Wholly-Owned Subsidiary of the Borrower or any
Subsidiary of the Borrower existing on the date of this
Agreement; and
(b) dividends or distributions by the Borrower to RHI
on its Capital Stock if the purpose thereof is to provide
TFC with funds necessary to service Indebtedness (as defined
in the 11 7/8% Senior Subordinated Debenture Indenture) of
TFC, but only to the extent TFC does not have Cash, Cash
Equivalents or readily marketable Securities available to
provide funds to otherwise service such Intebtedness, after
taking into account reasonable working capital needs of TFC
and its Subsidiaries; provided that the exception set forth
in this clause (b) shall not be effective if and to the
extent and during the period that the holders of TFC's 12
1/4% Senior Subordinated Notes due 1996 have waived the
benefits of Section 4.05 of the Indenture dated as of March
13, 1986 pursuant to which such Notes were issued, the
holders of TFC's 13 1/8% Subordinated Debentures due 2006
have waived the benefits of Section 4.05 of the Indenture
dated as of March 13, 1986 pursuant to which such Debentures
were issued and the holders of TFC's Intermediate
Subordinated Debentures due 2001 have waived the benefits of
Section 4.05 of the Indenture dated as of October 15, 1986
pursuant to which such Debentures were issued; and provided,
further, that such exception shall be available in any event
only so long as at least one of the Indentures described
above remains in effect and continues to restrict TFC from
permitting any of its Subsidiaries from entering into an
agreement restricting the payment of dividends or the making
of other distributions on any Subsidiary's Capital Stock
which are necessary to service Indebtedness of TFC;
provided, however, such Restricted Junior Payments shall not
be permitted after the occurrence and during the continuance
of an Event of Default or a Potential Event of Default or if
an Event of Default or a Potential Event of Default would
result therefrom.
10.07. Conduct of Business. The Borrower shall not
and shall not permit any of its Subsidiaries to engage in
any business other than (a) the businesses engaged in by the
Borrower and its Subsidiaries on the date hereof and (b) any
business or activities which are substantially similar,
related or incidental thereto.
10.08. Transactions with Shareholders and Affiliates.
The Borrower shall not and shall not permit any of its
Subsidiaries to directly or indirectly enter into or permit
to exist any transaction (including, without limitation, the
purchase, sale, lease or exchange of any property or the
rendering of any service) with any Affiliate on terms that
are less favorable to the Borrower or such Subsidiary of the
Borrower, as applicable, than those that might be obtained
in an arm's length transaction at the time from Persons who
are not an Affiliate. Nothing contained in this Section
10.08 shall prohibit (a) any transaction expressly permitted
by Sections 10.05 and 10.06; (b) increases in compensation
and benefits for officers and employees of the Borrower or
any of its Subsidiaries which are customary in the industry
or consistent with the past business practice of the
Borrower or such Subsidiary, provided that no Event of
Default or Potential Event of Default has occurred and is
continuing; (c) payment of customary directors' fees and
indemnities; (d) performance of any obligations arising
under the Transfer Documents or (e) performance of any
obligations arising under the Tax Allocation Agreement.
10.09. Restriction on Fundamental Changes. The
Borrower shall not and shall not permit any of its
Subsidiaries to (a) enter into any merger or consolidation,
or liquidate, wind-up or dissolve (or suffer any liquidation
or dissolution), or (b) convey, lease, sell, transfer or
otherwise dispose of, in one transaction or series of trans-
actions, all or substantially all of such Person's business
or Property, whether now or hereafter acquired.
10.10. Sales and Leasebacks. The Borrower shall not
and shall not permit any of its Subsidiaries to become
liable, directly, by assumption or by Accommodation
Obligation, with respect to any lease, whether an Operating
Lease or a Capital Lease, of any Property (whether real or
personal or mixed) which it or one of its Subsidiaries (a)
sold or transferred or is to sell or transfer to any other
Person, or (b) intends to use for substantially the same
purposes as any other Property which has been or is to be
sold or transferred by it or one of its Subsidiaries to any
other Person, in either instance, in connection with such
lease.
10.11. Margin Regulations; Securities Laws. The
Borrower shall not or permit any of its Subsidiaries to use
all or any portion of the proceeds of any credit extended
under this Agreement to purchase or carry Margin Stock.
10.12. ERISA. The Borrower shall not:
(a) engage, or permit any of its Subsidiaries to
engage, in any prohibited transaction described in Sections
406 of ERISA or 4975 of the Internal Revenue Code for which
a statutory or class exemption is not available or a private
exemption has not been previously obtained from the DOL;
(b) permit to exist any accumulated funding deficiency
(as defined in Sections 302 of ERISA and 412 of the Internal
Revenue Code), with respect to any Benefit Plan, whether or
not waived;
(c) fail, or permit any ERISA Affiliate to fail, to
pay timely required contributions or annual installments due
with respect to any waived funding deficiency to any Benefit
Plan;
(d) terminate, or permit any ERISA Affiliate to
terminate, any Benefit Plan which would result in any
liability of Borrower or any ERISA Affiliate under Title IV
of ERISA;
(e) fail to make any contribution or payment to any
Multiemployer Plan which Borrower or any ERISA Affiliate may
be required to make under any agreement relating to such
Multiemployer Plan, or any law pertaining thereto;
(f) fail, or permit any ERISA Affiliate to fail, to
pay any required installment or any other payment required
under Section 412 of the Internal Revenue Code on or before
the due date for such installment or other payment;
(g) amend, or permit any ERISA Affiliate to amend, a
Benefit Plan resulting in an increase in current liability
for the plan year such that the Borrower or any ERISA
Affiliate is required to provide security to such Plan under
Section 401(a)(29) of the Internal Revenue Code;
(h) permit any unfunded liabilities with respect to
any Foreign Pension Plan; or
(i) fail, or permit any of its Subsidiaries or ERISA
Affiliates to fail, to pay any required contributions or
payments to a Foreign Pension Plan on or before the due date
for such required installment or payment
if such event results, either singly or in the aggregate,
after taking into account all other such events and any
liabilities associated therewith, in an aggregate liability
in excess of $2,000,000.
10.13. Issuance of Equity Securities. The Borrower
shall not and shall not permit any of its Subsidiaries to
issue any equity Securities except equity Securities of the
Borrower pursuant to Permitted Equity Securities Options and
in connection with effecting the transfer of the Convac
Minority Interest.
10.14. Organizational Documents. The Borrower shall
not and shall not permit any of its Subsidiaries to amend,
modify or otherwise change any of the terms or provisions in
any of their respective Organizational Documents as in
effect on the Closing Date, except (a) with respect to which
written notice shall have been provided to the
Administrative Agent no less than ten (10) days prior to the
effective date of any such amendment, modification or change
and (b) if no Event of Default or Potential Event of Default
would result therefrom.
10.15. Bank Accounts. The Borrower shall not and
shall not permit any of its Domestic Subsidiaries to
establish or maintain any Deposit Account into which
collections of Receivables and proceeds of other Collateral
are deposited other than those identified as existing on the
Closing Date and disclosed on Schedule 10.15 attached
hereto.
10.16. Fiscal Year. The Borrower shall not and shall
not permit any of its Subsidiaries (other than Banner
Aerospace, Inc. in the event it becomes a Subsidiary) to
change its Fiscal Year for accounting or tax purposes from a
period consisting of the 12-month period ending on June 30
of each calendar year.
ARTICLE XI
FINANCIAL COVENANTS
The Borrower covenants and agrees that so long as any
Commitments are outstanding and thereafter until payment in
full of all of the Obligations (other than indemnities not
yet due):
11.01. Interest Coverage Ratio. The Borrower shall
maintain an Interest Coverage Ratio of at least 1.5 : 1.0,
as determined as of the last day of (a) April, 1996 for the
period commencing on the Closing Date and ending on April
30, 1996, and (b) May, 1996 for the period commencing on
April 1, 1996 and ending on May 31, 1996.
11.02. Minimum EBITDA. The Operating Units shall have
a minimum EBITDA of no less than $14,000,000 for the nine
(9) months ended March 31, 1996.
11.03. Capital Expenditures. The Borrower and its
Subsidiaries shall not make Capital Expenditures during the
term of this Agreement in excess of $6,000,000, in the
aggregate.
ARTICLE XII
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
12.01. Events of Default. Each of the following
occurrences shall constitute an Event of Default under this
Agreement:
(a) Failure to Make Payments When Due. The Borrower
shall fail to pay (i) when due any principal of any Loan or
any Reimbursement Obligation or (ii) within one Business Day
after the due date therefor, any other Obligation.
(b) Breach of Certain Covenants. The Borrower shall
fail duly and punctually to perform or observe any agree-
ment, covenant or obligation under Sections 9.01, 9.02,
9.03, 9.04, 9.06, 9.10, 9.13 or 9.15, Article X or
Article XI.
(c) Breach of Representation or Warranty. Any repre-
sentation or warranty made or deemed made by the Borrower to
the Administrative Agent, any Lender or any Issuing Bank
herein or by the Borrower or any of its Subsidiaries in any
of the other Loan Documents or in any statement or
certificate at any time given by any such Person pursuant to
any of the Loan Documents shall be false or misleading in
any material respect on the date as of which made (or deemed
made).
(d) Other Defaults. The Borrower shall default in the
performance of or compliance with any term contained in this
Agreement (other than as identified in clauses (a), (b) or
(c) of this Section 12.01) or any default or event of
default shall occur under any of the other Loan Documents,
and such default or event of default shall continue for
fifteen (15) days after the occurrence thereof.
(e) Default as to Other Indebtedness. The Borrower or
any of its Subsidiaries shall fail to make any payment when
due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) with respect to any other
Indebtedness (other than an Obligation) of the Borrower and
its Subsidiaries aggregating $1,000,000 or more; or any
breach, default or event of default shall occur, or any
other condition shall exist under any instrument, agreement
or indenture pertaining to any such Indebtedness, if the
effect thereof is to cause an acceleration, mandatory
redemption or other required repurchase of such
Indebtedness, or permit the holder(s) of such Indebtedness
to accelerate the maturity of any such Indebtedness or
require a redemption or other repurchase of such
Indebtedness; or any such Indebtedness shall be otherwise
declared to be due and payable (by acceleration or
otherwise) or required to be prepaid, redeemed or otherwise
repurchased by the Borrower or any of its Subsidiaries
(other than by a regularly scheduled required prepayment)
prior to the stated maturity thereof.
(f) Involuntary Bankruptcy; Appointment of Receiver,
Etc. (i) An involuntary case shall be commenced against the
Borrower or any of its Subsidiaries and the petition shall
not be (A) controverted within ten (10) days after the
filing thereof and (B) dismissed, stayed, bonded or
discharged within sixty (60) days after commencement of the
case; or a court having jurisdiction in the premises shall
enter a decree or order for relief in respect of the
Borrower or any of its Subsidiaries in an involuntary case,
under any applicable bankruptcy, insolvency or other similar
law now or hereinafter in effect; or any other similar
relief shall be granted under any applicable federal, state,
local or foreign law.
(ii) A decree or order of a court having jurisdiction
in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other
officer having similar powers over the Borrower or any of
its Subsidiaries or over all or a substantial part of the
Property of the Borrower or any of its Subsidiaries shall be
entered; or an interim receiver, trustee or other custodian
of the Borrower or any of its Subsidiaries or of all or a
substantial part of the Property of the Borrower or any of
its Subsidiaries shall be appointed or a warrant of
attachment, execution or similar process against any
substantial part of the Property of the Borrower or any of
its Subsidiaries shall be issued and any such event shall
not be stayed, dismissed, bonded or discharged within thirty
(30) days after entry, appointment or issuance.
(g) Voluntary Bankruptcy; Appointment of Receiver,
Etc. The Borrower or any of its Subsidiaries shall commence
a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary
case to a voluntary case, under any such law, or shall
consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a
substantial part of its Property; or the Borrower or any of
its Subsidiaries shall make any assignment for the benefit
of creditors or shall be unable or fail, or admit in writing
its inability, to pay its debts as such debts become due; or
the board of directors (or equivalent) of the Borrower or
any of its Subsidiaries (or any committee thereof) adopts
any resolution or otherwise authorizes any action to approve
any of the foregoing.
(h) Dissolution. Any order, judgment or decree shall
be entered against the Borrower or any of its Subsidiaries
decreeing its involuntary dissolution or split up and such
order shall remain undischarged and unstayed for a period in
excess of sixty (60) days; or the Borrower or any of its
Subsidiaries shall otherwise dissolve, be dissolved, or
cease to exist except as specifically permitted by this
Agreement.
(i) Loan Documents; Failure of Security. At any time,
for any reason, (i) any Loan Document ceases to be in full
force and effect or the Borrower or any of its Subsidiaries
party thereto seeks to repudiate its obligations thereunder
or the Liens intended to be created thereby are, or the
Borrower or any such Subsidiary seeks to render such Liens,
invalid or unperfected, or (ii) Liens in favor of the
Administrative Agent for the benefit of the Holders
contemplated by the Loan Documents shall, at any time, for
any reason, be invalidated or otherwise cease to be in full
force and effect, or such Liens shall be subordinated or
shall not have the priority contemplated by this Agreement
or the Loan Documents.
(j) Judgments and Attachments. Any money judgment
(other than a money judgment covered by insurance as to
which the insurance company has acknowledged coverage), writ
or warrant of attachment, or similar process against the
Borrower or any of its Subsidiaries or any of their
respective assets involving in any case an amount in excess
of $500,000 is entered and shall remain undischarged,
unvacated, unbonded or unstayed for a period of thirty (30)
days or in any event later than five (5) days prior to the
date of any proposed sale thereunder; provided, however, if
any such judgment, writ or warrant of attachment or similar
process is in excess of $2,000,000, the entry thereof shall
immediately constitute an Event of Default hereunder.
(k) Termination Event. Any Termination Event occurs
which could reasonably be expected to subject either the
Borrower or any ERISA Affiliate to liability in excess of
$2,000,000.
(l) Waiver Application. The plan administrator of any
Benefit Plan applies under Section 412(d) of the Code for a
waiver of the minimum funding standards of Section 412(a) of
the Internal Revenue Code and the Administrative Agent
believes that the substantial business hardship upon which
the application for the waiver is based could subject either
the Borrower or any ERISA Affiliate to liability in excess
of $2,000,000.
(m) Change in Control. A Change of Control shall
occur.
(n) Material Adverse Effect. An event shall occur
which results in a Material Adverse Effect.
(o) TFC/RHI Liquidity. The TFC/RHI Liquidity as of
March 31, 1996 shall be less than $30,000,000.
(p) Public Debt Cross-Default. TFC shall fail to make
any payment when due on any Indebtedness of TFC owing with
respect to its (i) 12 1/4% Senior Subordinated Notes due
1996, (ii) 12% Intermediate Subordinated Debentures due
2001, (iii) 13 1/8% Subordinated Debentures due 2006, or
(iv) 13% Junior Subordinated Debentures due 2007; or RHI
shall fail to make any payment when due on any Indebtedness
of RHI with respect to the 11 7/8% Senior Subordinated
Debentures due 1999; or any breach, default or event of
default shall occur under any instrument, agreement or
indenture pertaining to any Indebtedness of TFC or RHI
described above, if the effect thereof (with or without the
giving of notice or lapse of time or both) is to accelerate
(as distinguished from imposing a requirement to offer to
purchase), or permit the holder(s) of such Indebtedness to
accelerate (as distinguished from imposing a requirement to
offer to purchase), the maturity of any such Indebtedness.
(q) TFC. TFC shall (i) pay dividends on or redeem any
of its shares of common stock or any Indebtedness prior to
its stated maturity at any time when the TFC/RHI Liquidity
is less than $30,000,000 or after giving effect to such
dividend or redemption the TFC/RHI Liquidity would be less
than $30,000,000 or (ii) permit any of its Subsidiaries
(other than RHI and any of its Subsidiaries) to, directly or
indirectly, make or own any Investment in any Person, or
redeem or pay prior to the scheduled maturity thereof any of
the Indebtedness of TFC referenced in clause (p) above,
except:
(A) Investments of TFC or any such Subsidiary in Cash
Equivalents;
(B) Investments of TFC or any such Subsidiary which
represent defaulted or extended obligations previously
contracted in the ordinary course of business thereof and
payable on terms necessary to effectuate the collection
thereof, in an amount not to exceed at any one time
outstanding, in the aggregate for TFC and all of its
Subsidiaries (other than RHI and any of its Subsidiaries)
$2,000,000; provided that the amount of such Investments by
TFC in any one obligor shall not exceed $1,000,000 in the
aggregate at any one time outstanding;
(C) Investments of TFC or any such Subsidiary arising
from Indebtedness between TFC and its Subsidiaries;
(D) Investments of TFC in the form of notes or other
Securites taken by TFC in connection with sales of assets of
TFC;
(E) Investments in the Capital Stock of RHI and other
Persons identified on Schedule 12.01-Q;
(F) Investments in an aggregate amount not to exceed
$100,000 at any time, or $100,000 in the aggregate during
the term of this Agreement, consisting of capital
contributions made by TFC or its Subsidiaries to Wholly-
Owned Subsidiaries of TFC formed after the Closing Date;
(G) other Investments in an aggregate amount not to
exceed $5,000,000 during the term of this Agreement.
An Event of Default shall be deemed "continuing" until
cured or waived in writing in accordance with Section 15.07.
12.02. Rights and Remedies.
(a) Acceleration and Termination. Upon the
occurrence of any Event of Default described in Sections
12.01(f) or 12.01(g), the Revolving Lenders' respective
obligations to make Revolving Loans under the Revolving
Credit Commitments shall automatically and immediately
terminate and the unpaid principal amount of, and any and
all accrued interest on, the Obligations and all accrued
fees shall automatically become immediately due and payable,
without presentment, demand, or protest or other
requirements of any kind (including, without limitation,
valuation and appraisement, diligence, presentment, notice
of intent to demand or accelerate and of acceleration), all
of which are hereby expressly waived by the Borrower; and
upon the occurrence and during the continuance of any other
Event of Default, the Administrative Agent shall at the
request, or may with the consent, of the Requisite Lenders,
by written notice to the Borrower, (i) declare that the
Revolving Lenders' respective obligations to make Revolving
Loans under the Revolving Credit Commitments are terminated,
whereupon such obligation of each such Lender to make any
Revolving Loan hereunder and of each such Lender or Issuing
Bank to issue or participate in any Letter of Credit not
then issued shall immediately terminate, and/or (ii) declare
the unpaid principal amount of and any and all accrued and
unpaid interest on the Obligations to be, and the same shall
thereupon be, immediately due and payable, without
presentment, demand, or protest or other requirements of any
kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to
demand or accelerate and of acceleration), all of which are
hereby expressly waived by the Borrower.
(b) Deposit for Letters of Credit. In addition, after
the occurrence and during the continuance of an Event of
Default, the Borrower shall, promptly upon demand by the
Administrative Agent, deliver to the Administrative Agent,
Cash Collateral in such form as requested by the
Administrative Agent for deposit in the Cash Collateral
Account, together with such endorsements, and execution and
delivery of such documents and instruments, as the
Administrative Agent may request in order to perfect or
protect the Administrative Agent's Lien with respect
thereto, in an aggregate principal amount equal to the then
outstanding Letter of Credit Obligations.
(c) Rescission. If at any time after termination of
the Revolving Lenders' obligations to make Revolving Loans
under the Revolving Credit Commitments and/or acceleration
of the maturity of the Loans, the Borrower shall pay all
arrears of interest and all payments on account of principal
of the Loans and Reimbursement Obligations which shall have
become due otherwise than by acceleration (with interest on
principal and, to the extent permitted by law, on overdue
interest, at the rates specified in this Agreement) and all
Events of Default and Potential Events of Default (other
than nonpayment of principal of and accrued interest on the
Loans due and payable solely by virtue of acceleration)
shall be remedied or waived pursuant to Section 15.07, then
upon the written consent of the Requisite Lenders and
written notice to the Borrower, the termination of the
Revolving Lenders' respective obligations to make Revolving
Loans under the Revolving Credit Commitments and the
respective Revolving Lenders' and Issuing Banks' obligations
to participate in or issue Letters of Credit and/or the
aforesaid acceleration and its consequences may be rescinded
and annulled; but such action shall not affect any
subsequent Event of Default or Potential Event of Default or
impair any right or remedy consequent thereon. The
provisions of the preceding sentence are intended merely to
bind the Lenders and the Issuing Banks to a decision which
may be made at the election of the Requisite Lenders; they
are not intended to benefit the Borrower and do not give the
Borrower the right to require the Lenders to rescind or
annul any termination of the aforesaid obligations of the
Revolving Lenders or Issuing Banks or any acceleration here-
under, even if the conditions set forth herein are met.
(d) Enforcement. The Borrower acknowledges that in
the event the Borrower or any of its Subsidiaries fails to
perform, observe or discharge any of their respective
obligations or liabilities under this Agreement or any other
Loan Document, any remedy of law may prove to be inadequate
relief to the Administrative Agent, the Issuing Banks and
the Lenders; therefore, the Borrower agrees that the
Administrative Agent, the Issuing Banks and the Lenders
shall be entitled to temporary and permanent injunctive
relief in any such case without the necessity of proving
actual damages.
ARTICLE XIII
THE ADMINISTRATIVE AGENT
13.01. Appointment. (a) Each Lender and each Issuing
Bank hereby designates and appoints Citicorp as the
Administrative Agent of such Lender or such Issuing Bank
under this Agreement, and each Lender and each Issuing Bank
hereby irrevocably authorizes the Administrative Agent to
take such action on its behalf under the provisions of this
Agreement and the Loan Documents and to exercise such powers
as are set forth herein or therein together with such other
powers as are reasonably incidental thereto. The
Administrative Agent agrees to act as such on the express
conditions contained in this Article XIII.
(b) The provisions of this Article XIII are solely for
the benefit of the Administrative Agent, the Lenders and
Issuing Banks, and neither the Borrower nor any Subsidiary
of the Borrower shall have any rights to rely on or enforce
any of the provisions hereof (other than as expressly set
forth in Section 13.07). In performing its functions and
duties under this Agreement, the Administrative Agent shall
act solely as Administrative Agent of the Lenders and the
Issuing Banks and does not assume and shall not be deemed to
have assumed any obligation or relationship of agency,
trustee or fiduciary with or for the Borrower or any
Affiliate of the Borrower. The Administrative Agent may
perform any of its duties hereunder, or under the other Loan
Documents, by or through its Administrative Agents or
employees.
13.02. Nature of Duties. The Administrative Agent
shall not have any duties or responsibilities except those
expressly set forth in this Agreement or in the Loan
Documents. The duties of the Administrative Agent shall be
mechanical and administrative in nature. The Administrative
Agent shall not have by reason of this Agreement a fiduciary
relationship in respect of any Holder. Nothing in this
Agreement or any of the Loan Documents, expressed or
implied, is intended to or shall be construed to impose upon
the Administrative Agent any obligations in respect of this
Agreement or any of the other Loan Documents except as
expressly set forth herein or therein. Each Lender and each
Issuing Bank shall make its own independent investigation of
the financial condition and affairs of the Borrower and
Affiliates in connection with the making and the continuance
of the Loans hereunder and with the issuance of the Letters
of Credit and shall make its own appraisal of the
creditworthiness of the Borrower and Guarantors initially
and on a continuing basis, and the Administrative Agent
shall not have any duty or responsibility, either initially
or on a continuing basis, to provide any Holder with any
credit or other information with respect thereto (except for
reports required to be delivered by the Administrative Agent
under the terms of this Agreement). If the Administrative
Agent seeks the consent or approval of the Lenders to the
taking or refraining from taking of any action hereunder,
the Administrative Agent shall send notice thereof to each
Lender. The Administrative Agent shall promptly notify each
Lender at any time that the Lenders so required hereunder
have instructed the Administrative Agent to act or refrain
from acting pursuant hereto. As to any matters not expressly
provided for by this Agreement (including, without
limitation, enforcement or collection of the Notes or any
amount payable under any provision of Article IV when due)
or the other Loan Documents, the Administrative Agent shall
not be required to exercise any discretion or take any
action. Notwithstanding the foregoing, the Administrative
Agent shall be required to act or refrain from acting (and
shall be fully protected in so acting or refraining from
acting) upon the instructions of the Requisite Lenders
(unless the instructions or consent of all of the Lenders is
required hereunder or thereunder) and such instructions
shall be binding upon all Lenders, Issuing Banks and Holders
of Notes; provided, however, the Administrative Agent shall
not be required to take any action which (i) the
Administrative Agent reasonably believes will expose it to
personal liability unless the Administrative Agent receives
an indemnification satisfactory to it from the Lenders with
respect to such action or (ii) is contrary to this
Agreement, the other Loan Documents or applicable law.
13.03. Rights, Exculpation, Etc. (a) Liabilities;
Responsibilities. None of the Administrative Agent, any
Affiliate of the Administrative Agent, or any of their
respective officers, directors, employees or Administrative
Agents shall be liable to any Holder for any action taken or
omitted by them hereunder or under any of the Loan
Documents, or in connection therewith, except that no Person
shall be relieved of any liability imposed by law for gross
negligence or willful misconduct. The Administrative Agent
shall not be liable for any apportionment or distribution of
payments made by it in good faith pursuant to Section
4.02(b), and if any such apportionment or distribution is
subsequently determined to have been made in error the sole
recourse of any Holder to whom payment was due, but not
made, shall be to recover from other Holders any payment in
excess of the amount to which they are determined to have
been entitled. The Administrative Agent shall not be
responsible to any Holder for any recitals, statements,
representations or warranties herein or for the execution,
effectiveness, genuineness, validity, legality, enforce-
ability, collectibility, or sufficiency of this Agreement or
any of the other Loan Documents or the transactions
contemplated thereby, or for the financial condition of the
Borrower or any of its Affiliates or the Guarantors. The
Administrative Agent shall not be required to make any
inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement
or any of the other Loan Documents, or the financial
condition of the Borrower or any of its Affiliates or the
Guarantors, or the existence or possible existence of any
Potential Event of Default or Event of Default.
(b) Right to Request Instructions. The Administrative
Agent may at any time request instructions from the Lenders
with respect to any actions or approvals which by the terms
of any of the Loan Documents the Administrative Agent is
permitted or required to take or to grant, and the
Administrative Agent shall be absolutely entitled to refrain
from taking any action or to withhold any approval and shall
not be under any liability whatsoever to any Person for
refraining from any action or withholding any approval under
any of the Loan Documents until it shall have received such
instructions from those Lenders from whom the Administrative
Agent is required to obtain such instructions for the
pertinent matter in accordance with the Loan Documents.
Without limiting the generality of the foregoing, no Holder
shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent
acting or refraining from acting under the Loan Documents in
accordance with the instructions of the Requisite Lenders
or, where required by the express terms of this Agreement, a
greater proportion of the Lenders.
13.04. Reliance. The Administrative Agent shall be
entitled to rely upon any written notices, statements,
certificates, orders or other documents or any telephone
message believed by it in good faith to be genuine and
correct and to have been signed, sent or made by the proper
Person, and with respect to all matters pertaining to this
Agreement or any of the Loan Documents and its duties
hereunder or thereunder, upon advice of legal counsel
(including counsel for the Borrower), independent public
accountants and other experts selected by it.
13.05. Indemnification. To the extent that the
Administrative Agent is required to be reimbursed and
indemnified by the Borrower but is not reimbursed and
indemnified by the Borrower, the Lenders will reimburse and
indemnify the Administrative Agent for and against any and
all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on,
incurred by, or asserted against it in any way relating to
or arising out of the Loan Documents or any action taken or
omitted by the Administrative Agent under the Loan
Documents, in proportion to each Lender's Pro Rata Share.
The obligations of the Lenders under this Section 13.05
shall survive the payment in full of the Loans, the
Reimbursement Obligations and all other Obligations and the
termination of this Agreement.
13.06. Citicorp Individually. With respect to its Pro
Rata Share of the Commitments hereunder, if any, and the
Loans made by it, if any, Citicorp shall have and may
exercise the same rights and powers hereunder and is subject
to the same obligations and liabilities as and to the extent
set forth herein for any other Lender. The terms "Lenders"
or "Requisite Lenders" or any similar terms shall, unless
the context clearly otherwise indicates, include Citicorp in
its individual capacity as a Lender or one of the Requisite
Lenders. Citicorp and its Affiliates may accept deposits
from, lend money to, and generally engage in any kind of
banking, trust or other business with the Borrower or any of
its Affiliates as if it were not acting as the
Administrative Agent pursuant hereto.
13.07. Successor Administrative Agents. (a)
Resignation. The Administrative Agent may resign from the
performance of all its functions and duties hereunder at any
time by giving at least thirty (30) Business Days' prior
written notice to the Borrower and the Lenders. Such
resignation shall take effect upon the acceptance by a
successor Administrative Agent of appointment pursuant to
this Section 13.07.
(b) Appointment by Requisite Lenders. Upon any
such notice of resignation, the Requisite Lenders shall have
the right to appoint a successor Administrative Agent
selected from among the Lenders which appointment shall be
subject to the prior written approval of the Borrower (which
may not be unreasonably withheld, and shall not be required
upon the occurrence and during the continuance of an Event
of Default).
(c) Appointment by Retiring Administrative Agent. If
a successor Administrative Agent shall not have been
appointed within the thirty (30) Business Day period
provided in clause (a) of this Section 13.07, the retiring
Administrative Agent, with the consent of the Borrower
(which may not be unreasonably withheld, and shall not be
required upon the occurrence and during the continuance of
an Event of Default), shall then appoint a successor
Administrative Agent who shall serve as Administrative Agent
until such time, if any, as the Requisite Lenders appoint a
successor Administrative Agent as provided above.
(d) Rights of the Successor and Retiring
Administrative Agents. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent
shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's
resignation hereunder as Administrative Agent, the
provisions of this Article XIII shall inure to its benefit
as to any actions taken or omitted to be taken by it while
it was the Administrative Agent under this Agreement.
13.08. Relations Among Lenders. Each Lender and each
Issuing Bank agrees (except as provided in Section 15.05)
that it will not take any legal action, nor institute any
actions or proceedings, against the Borrower or any other
obligor hereunder or with respect to any Collateral, without
the prior written consent of the Requisite Lenders. Without
limiting the generality of the foregoing, no Lender may
accelerate or otherwise enforce its portion of the
Obligations, or unilaterally terminate its Commitments
except in accordance with Section 12.02(a).
13.09. Concerning the Collateral and the Loan
Documents. (a) Protective Advances. The Administrative
Agent may from time to time, before or after the occurrence
of an Event of Default, make such disbursements and advances
pursuant to the Loan Documents which the Administrative
Agent, in its sole discretion, deems necessary or desirable
to preserve or protect the Collateral or any portion thereof
or to enhance the likelihood or maximize the amount of
repayment of the Loans and other Obligations ("Protective
Advances"). The Administrative Agent shall notify the
Borrower and each Lender in writing of each such Protective
Advance, which notice shall include a description of the
purpose of such Protective Advance. The Borrower agrees to
pay the Administrative Agent, upon demand, the principal
amount of all outstanding Protective Advances, together with
interest thereon at the rate from time to time applicable to
Base Rate Loans from the date of such Protective Advance
until the outstanding principal balance thereof is paid in
full. If the Borrower fails to make payment in respect of
any Protective Advance within one (1) Business Day after the
date the Borrower receives written demand therefor from the
Administrative Agent, the Administrative Agent shall
promptly notify each Revolving Lender and each Revolving
Lender agrees that it shall thereupon make available to the
Administrative Agent, in Dollars in immediately available
funds, the amount equal to such Revolving Lender's Pro Rata
Share of such Protective Advance. If such funds are not
made available to the Administrative Agent by such Revolving
Lender within one (1) Business Day after the Administrative
Agent's demand therefor, the Administrative Agent will be
entitled to recover any such amount from such Revolving
Lender together with interest thereon at the Federal Funds
Rate for each day during the period commencing on the date
of such demand and ending on the date such amount is
received. The failure of any Revolving Lender to make
available to the Administrative Agent its Pro Rata Share of
any such Protective Advance shall neither relieve any other
Revolving Lender of its obligation hereunder to make
available to the Administrative Agent such other Revolving
Lender's Pro Rata Share of such Protective Advance on the
date such payment is to be made nor increase the obligation
of any other Revolving Lender to make such payment to the
Administrative Agent. All outstanding principal of, and
interest on, Protective Advances shall constitute
Obligations secured by the Collateral until paid in full by
the Borrower.
(b) Authority. Each Lender and each Issuing Bank
authorizes and directs the Administrative Agent to enter
into the Loan Documents relating to the Collateral for the
benefit of the Lenders and the Issuing Banks. Each Lender
and each Issuing Bank agrees that any action taken by the
Administrative Agent or the Requisite Lenders (or, where
required by the express terms of this Agreement, a greater
proportion of the Lenders) in accordance with the provisions
of this Agreement or the other Loan Documents, and the
exercise by the Administrative Agent or the Requisite
Lenders (or, where so required, such greater proportion) of
the powers set forth herein or therein, together with such
other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders and Issuing
Banks. Without limiting the generality of the foregoing,
the Administrative Agent shall have the sole and exclusive
right and authority to (i) act as the disbursing and
collecting Administrative Agent for the Lenders and the
Issuing Banks with respect to all payments and collections
arising in connection with this Agreement and the Loan
Documents relating to the Collateral; (ii) execute and
deliver each Loan Document relating to the Collateral and
accept delivery of each such agreement delivered by the
Borrower, any of its Subsidiaries or any Guarantor a party
thereto; (iii) act as collateral agent for the Lenders and
the Issuing Banks for purposes of the perfection of all
security interests and Liens created by such agreements and
all other purposes stated therein; provided, however, the
Administrative Agent hereby appoints, authorizes and directs
the Lenders and the Issuing Banks to act as collateral sub-
agent for the Administrative Agent, the Lenders and the
Issuing Banks for purposes of the perfection of all security
interests and Liens with respect to the Property at any time
in the possession of such Lender or such Issuing Bank,
including, without limitation, Deposit Accounts maintained
with, and cash and Cash Equivalents held by, such Lender or
such Issuing Bank; (iv) manage, supervise and otherwise deal
with the Collateral; (v) take such action as is necessary or
desirable to maintain the perfection and priority of the
security interests and liens created or purported to be
created by the Loan Documents; and (vi) except as may be
otherwise specifically restricted by the terms of this
Agreement or any other Loan Document, exercise all remedies
given to the Administrative Agent, the Lenders or the
Issuing Banks with respect to the Collateral under the Loan
Documents relating thereto, applicable law or otherwise.
(c) Release of Collateral. (i) Each Lender and each
Issuing Bank hereby directs, in accordance with the terms of
this Agreement, the Administrative Agent to release any Lien
held by the Administrative Agent for the benefit of the
Holders:
(A) against all of the Collateral, upon final and
indefeasible payment in full of the Obligations and termina-
tion of this Agreement;
(B) against any part of the Collateral sold or
disposed of by the Borrower or any of its Subsidiaries, if
such sale or disposition is permitted by Section 10.02 or is
otherwise consented to by the Requisite Lenders, as
certified to the Administrative Agent by the Borrower in an
Officer's Certificate; and/or
(C) against any part of the Collateral consisting of a
promissory note, upon final and indefeasible payment in full
of the Indebtedness evidenced thereby.
(ii) Each Lender and each Issuing Bank hereby directs
the Administrative Agent to execute and deliver or file such
termination and partial release statements and do such other
things as are necessary to release Liens to be released
pursuant to this Section 13.09(c) promptly upon the
effectiveness of any such release.
ARTICLE XIV
YIELD PROTECTION
14.01. Taxes. (a) Payment of Taxes. Any and all
payments by the Borrower hereunder or under any Note or
other document evidencing any Obligations shall be made, in
accordance with Section 4.02, free and clear of and without
reduction for any and all present or future taxes, levies,
imposts, deductions, charges, withholdings, and all stamp or
documentary taxes, excise taxes, ad valorem taxes and other
taxes imposed on the value of the Property, charges or
levies which arise from the execution, delivery or
registration, or from payment or performance under, or
otherwise with respect to, any of the Loan Documents or the
Commitments and all other liabilities with respect thereto
excluding, in the case of each Lender, each Issuing Bank and
the Administrative Agent, taxes imposed on or measured by
net income or overall gross receipts and capital and
franchise taxes imposed on it by (i) the United States, (ii)
the Governmental Authority of the jurisdiction in which such
Lender's Applicable Lending Office is located or any
political subdivision thereof or (iii) the Governmental
Authority in which such Person is organized, managed and
controlled or any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges and
withholdings being hereinafter referred to as "Taxes"). If
the Borrower shall be required by law to withhold or deduct
any Taxes from or in respect of any sum payable hereunder or
under any such Note or document to any Lender, any Issuing
Bank or the Administrative Agent, (x) the sum payable to
such Lender, Issuing Bank, or the Administrative Agent shall
be increased as may be necessary so that after making all
required withholding or deductions (including withholding or
deductions applicable to additional sums payable under this
Section 14.01) such Lender, such Issuing Bank or the
Administrative Agent (as the case may be) receives an amount
equal to the sum it would have received had no such
withholding or deductions been made, (y) the Borrower shall
make such withholding or deductions, and (z) the Borrower
shall pay the full amount withheld or deducted to the
relevant taxation authority or other authority in accordance
with applicable law.
(b) Indemnification. The Borrower will indemnify each
Lender, each Issuing Bank and the Administrative Agent
against, and reimburse each on demand for, the full amount
of all Taxes (including, without limitation, any Taxes
imposed by any Governmental Authority on amounts payable
under this Section 14.01 and any additional income or
franchise taxes resulting therefrom) incurred or paid by
such Lender, such Issuing Bank or the Administrative Agent
(as the case may be) or any of their respective Affiliates
and any liability (including penalties, interest, and out-
of-pocket expenses paid to third parties) arising therefrom
or with respect thereto, whether or not such Taxes were
lawfully payable. A certificate as to any additional amount
payable to any Person under this Section 14.01 submitted by
it to the Borrower shall, absent manifest error, be final,
conclusive and binding upon all parties hereto. Each Lender
and each Issuing Bank agrees, within a reasonable time after
receiving a written request from the Borrower, to provide
the Borrower and the Administrative Agent with such
certificates as are reasonably required, and take such other
actions as are reasonably necessary to claim such exemptions
as such Lender or such Issuing Bank may be entitled to claim
in respect of all or a portion of any Taxes which are
otherwise required to be paid or deducted or withheld
pursuant to this Section 14.01 in respect of any payments
under this Agreement or under the Notes.
(c) Receipts. Within thirty (30) days after the date
of any payment of Taxes by the Borrower, it will furnish to
the Administrative Agent, at its address referred to in
Section 15.08, the original or a certified copy of a receipt
evidencing payment thereof.
(d) Foreign Bank Certifications. (i) Each Lender that
is not created or organized under the laws of the United
States or a political subdivision thereof shall deliver to
the Borrower and the Administrative Agent on the Closing
Date or the date on which such Lender becomes a Lender
pursuant to Section 15.01 hereof a true and accurate certif-
icate executed in duplicate by a duly authorized officer of
such Lender to the effect that such Lender is eligible to
receive payments hereunder and under the Notes without
deduction or withholding of United States federal income tax
(I) under the provisions of an applicable tax treaty
concluded by the United States (in which case the
certificate shall be accompanied by two duly completed
copies of IRS Form 1001 (or any successor or substitute form
or forms)), (II) under Sections 1442(c)(1) and 1442(a) of
the Internal Revenue Code (in which case the certificate
shall be accompanied by two duly completed copies of IRS
Form 4224 (or any successor or substitute form or forms)),
or (III) due to such Lender's not being a "bank" as such
term is used in Section 881(c)(3)(A) of the Internal Revenue
Code (in which case, the certificate shall be accompanied by
two accurate and complete original signed copies of IRS Form
W-8 (or any successor or substitute form or forms)).
(ii) Each Lender further agrees to deliver to the Bor-
rower and the Administrative Agent from time to time, a true
and accurate certificate executed in duplicate by a duly
authorized officer of such Lender before or promptly upon
the occurrence of any event requiring a change in the most
recent certificate previously delivered by it to the
Borrower and the Administrative Agent pursuant to this
Section 14.01(d). Each certificate required to be delivered
pursuant to this Section 14.01(d)(ii) shall certify as to
one of the following:
(A) that such Lender can continue to receive payments
hereunder and under the Notes without deduction or
withholding of United States federal income tax;
(B) that such Lender cannot continue to receive
payments hereunder and under the Notes without deduction or
withholding of United States federal income tax as specified
therein but does not require additional payments pursuant to
Section 14.01(a) because it is entitled to recover the full
amount of any such deduction or withholding from a source
other than the Borrower; or
(C) that such Lender is no longer capable of receiving
payments hereunder and under the Notes without deduction or
withholding of United States federal income tax as specified
therein and that it is not capable of recovering the full
amount of the same from a source other than the Borrower.
Each Lender agrees to deliver to the Borrower and the
Administrative Agent further duly completed copies of the
above-mentioned IRS forms on or before the earlier of (x)
the date that any such form expires or becomes obsolete or
otherwise is required to be resubmitted as a condition to
obtaining an exemption from withholding from United States
federal income tax and (y) fifteen (15) days after the
occurrence of any event requiring a change in the most
recent form previously delivered by such Lender to the
Borrower and Administrative Agent, unless any change in
treaty, law, regulation, or official interpretation thereof
which would render such form inapplicable or which would
prevent the Lender from duly completing and delivering such
form has occurred prior to the date on which any such
delivery would otherwise be required and the Lender promptly
advises the Borrower that it is not capable of receiving
payments hereunder and under the Notes without any deduction
or withholding of United States federal income tax.
14.02. Increased Capital. If after the date hereof
any Lender or Issuing Bank determines that (i) the adoption
or implementation of or any change in or in the
interpretation or administration of any law or regulation or
any guideline or request from any central bank or other
Governmental Authority or quasi-governmental authority
exercising jurisdiction, power or control over any Lender,
Issuing Bank or banks or financial institutions generally
(whether or not having the force of law), compliance with
which affects or would affect the amount of capital required
or expected to be maintained by such Lender or Issuing Bank
or any Person controlling such Lender or Issuing Bank and
(ii) the amount of such capital is increased by or based
upon (A) the making or maintenance by any Lender of its
Loans, any Lender's participation in or obligation to
participate in the Loans, Letters of Credit or other
advances made hereunder or the existence of any Lender's
obligation to make Loans or (B) the issuance or maintenance
by any Issuing Bank of, or the existence of any Issuing
Bank's obligation to issue, Letters of Credit, then, in any
such case, upon written demand by such Lender or Issuing
Bank (with a copy of such demand to the Administrative
Agent), the Borrower shall immediately pay to the
Administrative Agent for the account of such Lender or
Issuing Bank, from time to time as specified by such Lender
or Issuing Bank, additional amounts sufficient to compensate
such Lender or Issuing Bank or such Person therefor. Such
demand shall be accompanied by a statement as to the amount
of such compensation and include a brief summary of the
basis for such demand. Such statement shall be conclusive
and binding for all purposes, absent manifest error.
14.03. Changes; Legal Restrictions. If after the date
hereof any Lender or Issuing Bank determines that the
adoption or implementation of or any change in or in the
interpretation or administration of any law or regulation or
any guideline or request from any central bank or other
Governmental Authority or quasi-governmental authority
exercising jurisdiction, power or control over any Lender,
Issuing Bank or over banks or financial institutions
generally (whether or not having the force of law),
compliance with which:
(a) does or will subject a Lender or an Issuing Bank
(or its Applicable Lending Office or Eurodollar Affiliate)
to charges (other than taxes) of any kind which such Lender
or Issuing Bank reasonably determines to be applicable to
the Commitments of the Lenders and/or the Issuing Banks to
make Eurodollar Rate Loans or issue and/or participate in
Letters of Credit or change the basis of taxation of
payments to that Lender or Issuing Bank of principal, fees,
interest, or any other amount payable hereunder with respect
to Eurodollar Rate Loans or Letters of Credit; or
(b) does or will impose, modify, or hold applicable,
in the determination of a Lender or an Issuing Bank, any
reserve (other than reserves taken into account in
calculating the Eurodollar Rate), special deposit,
compulsory loan, FDIC insurance or similar requirement
against assets held by, or deposits or other liabilities
(including those pertaining to Letters of Credit) in or for
the account of, advances or loans by, commitments made, or
other credit extended by, or any other acquisition of funds
by, a Lender or an Issuing Bank or any Applicable Lending
Office or Eurodollar Affiliate of that Lender or Issuing
Bank;
and the result of any of the foregoing is to increase the
cost to that Lender or Issuing Bank of making, renewing or
maintaining the Loans or its Commitments with respect to, or
issuing or participating in, the Letters of Credit or to
reduce any amount receivable thereunder; then, in any such
case, upon written demand by such Lender or Issuing Bank
(with a copy of such demand to the Administrative Agent),
the Borrower shall immediately pay to the Administrative
Agent for the account of such Lender or Issuing Bank, from
time to time as specified by such Lender or Issuing Bank,
such amount or amounts as may be necessary to compensate
such Lender or Issuing Bank or its Eurodollar Affiliate for
any such additional cost incurred or reduced amount
received. Such demand shall be accompanied by a statement
as to the amount of such compensation and include a brief
summary of the basis for such demand. Such statement shall
be conclusive and binding for all purposes, absent manifest
error.
14.04. Illegality. (i) If at any time any Lender
determines (which determination shall, absent manifest
error, be final and conclusive and binding upon all parties)
that the making or continuation of or conversion into any
Eurodollar Rate Loan has become unlawful or impermissible by
compliance by that Lender with any law, governmental rule,
regulation or order of any Governmental Authority (whether
or not having the force of law and whether or not failure to
comply therewith would be unlawful or would result in costs
or penalties), then, and in any such event, such Lender may
give notice of that determination, in writing, to the
Borrower and the Administrative Agent, and the
Administrative Agent shall promptly transmit the notice to
each other Lender.
(ii) When notice is given by a Lender under Section
14.04(i), (A) the Borrower's right to request from such
Lender and such Lender's obligation, if any, to make
Eurodollar Rate Loans shall be immediately suspended, and
such Lender shall make a Base Rate Loan as part of any
requested Borrowing of Eurodollar Rate Loans and (B) if the
affected Eurodollar Rate Loan or Loans are then outstanding,
the Borrower shall immediately, or if permitted by appli-
cable law, no later than the date permitted thereby, upon at
least one (1) Business Day's prior written notice to the
Administrative Agent and the affected Lender, convert each
such Loan into a Base Rate Loan.
(iii) If at any time after a Lender gives notice under
Section 14.04(i) such Lender determines that it may lawfully
make Eurodollar Rate Loans, such Lender shall promptly give
notice of that determination, in writing, to the Borrower
and the Administrative Agent, and the Administrative Agent
shall promptly transmit the notice to each other Lender.
The Borrower's right to request, and such Lender's
obligation, if any, to make Eurodollar Rate Loans shall
thereupon be restored.
14.05. Compensation. In addition to all amounts
required to be paid by the Borrower pursuant to
Section 5.01, the Borrower shall compensate each Lender,
upon demand, for all losses, expenses and liabilities
(including, without limitation, any loss or expense incurred
by reason of the liquidation or reemployment of deposits or
other funds acquired by such Lender to fund or maintain such
Lender's Eurodollar Rate Loans to the Borrower but excluding
any loss of Applicable Eurodollar Rate Margin on the
relevant Loans) which that Lender may sustain (i) if for any
reason a Borrowing, conversion into or continuation of
Eurodollar Rate Loans does not occur on a date specified
therefor in a Notice of Borrowing or a Notice of Conver-
sion/Continuation given by the Borrower or in a telephonic
request by it for borrowing or conversion/continuation or a
successive Eurodollar Interest Period does not commence
after notice therefor is given pursuant to Section 5.01(c),
including, without limitation, pursuant to Section 5.02(e),
(ii) if for any reason any Eurodollar Rate Loan is prepaid
(including, without limitation, mandatorily pursuant to
Section 4.01) on a date which is not the last day of the
applicable Eurodollar Interest Period, (iii) as a
consequence of a required conversion of a Eurodollar Rate
Loan to a Base Rate Loan as a result of any of the events
indicated in Section 5.02(e), or (iv) as a consequence of
any failure by the Borrower to repay Eurodollar Rate Loans
when required by the terms of this Agreement. The Lender
making demand for such compensation shall deliver to the
Borrower concurrently with such demand a written statement
in reasonable detail as to such losses, expenses and
liabilities, and this statement shall be conclusive as to
the amount of compensation due to that Lender, absent
manifest error.
14.06. Limitation on Additional Amounts Payable by the
Borrower. Notwithstanding the provisions of Section
14.01(a), the Borrower shall not be required to pay any
additional amounts hereunder to a Lender or Issuing Bank if
(a) the obligation to pay such additional amounts would not
have arisen but for a failure by the Lender or Issuing Bank
to comply with the requirements described in Section 14.01
or (b) the Lender or Issuing Bank shall not have furnished
the Borrower with such forms or shall not have taken such
other action as reasonably may be available to it under
applicable tax laws and any applicable tax treaty to obtain
an exemption from, or reduction (to the lowest applicable
rate) of withholding of such United States federal income
tax; provided, however, the Borrower's obligation to pay
such additional amounts shall be reinstated upon receipt of
such forms or evidence that action with respect to obtaining
such exemption or reduction has been taken.
14.07. Change in Lending Office. Any Lender claiming
any additional amounts payable pursuant to Section 14.01
shall use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the
Domestic Lending Office designated by it for purposes of
this Agreement to a Domestic Lending Office in another
jurisdiction, if the making of such a change would avoid the
need for, or reduce the amount of, any such additional
amounts which may thereafter accrue and would not, in the
judgment of such Lender, be otherwise disadvantageous to
such Lender.
ARTICLE XV
MISCELLANEOUS
15.01. Assignments and Participations. (a) Assign-
ments. No assignments or participations of any Lender's
rights or obligations under this Agreement shall be made
except in accordance with this Section 15.01. Each Lender
may assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement
(including all of its rights and obligations with respect to
the Term Loans, the Revolving Loans and the Letters of
Credit) in accordance with the provisions of this Section
15.01.
(b) Limitations on Assignments. Each assignment shall
be subject to the following conditions: (i) each such
assignment may be on a non-pro-rata basis, but shall be of a
constant, and not a varying, ratable percentage of all of
the assigning Lender's rights and obligations under this
Agreement which are subject to such assignment and, in the
case of a partial assignment to a Person which is not a
Lender, shall be in a minimum principal amount aggregating
$5,000,000, (ii) each such assignment shall be to an
Eligible Assignee consented to by the Issuing Banks, which
consent shall not be unreasonably withheld or delayed, (iii)
the Borrower shall have the right to approve each such
Eligible Assignee which is not an Affiliate of a Lender,
which approval shall not be unreasonably withheld or delayed
and (iv) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance
and recording in the Register, an Assignment and Acceptance.
Upon such execution, delivery, acceptance and recording in
the Register, from and after the effective date specified in
each Assignment and Acceptance and agreed to by the
Administrative Agent, (A) the assignee thereunder shall, in
addition to any rights and obligations hereunder held by it
immediately prior to such effective date, if any, have the
rights and obligations hereunder that have been assigned to
it pursuant to such Assignment and Acceptance and shall, to
the fullest extent permitted by law, have the same rights
and benefits hereunder as if it were an original Lender
hereunder, (B) the assigning Lender shall, to the extent
that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance
covering all or the remaining portion of such assigning
Lender's rights and obligations under this Agreement, the
assigning Lender shall cease to be a party hereto), and (C)
the Borrower shall execute and deliver to the assignee
thereunder one or more Notes, as applicable, evidencing its
obligations to such assignee with respect to the Loans.
(c) The Register. The Administrative Agent shall
maintain at its address referred to in Section 15.08 a copy
of each Assignment and Acceptance delivered to and accepted
by it and a register (the "Register") for the recordation of
the names and addresses of the Lenders and the Commitment
under each Loan of, and principal amount of the Loans under
each facility owing to, each Lender from time to time and
whether such Lender is an original Lender or the assignee of
another Lender pursuant to an Assignment and Acceptance.
The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and the Borrower
and each of its Subsidiaries, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in
the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection
by the Borrower or any Lender at any reasonable time and
from time to time upon reasonable prior notice.
(d) Fee. Upon its receipt of an Assignment and Accep-
tance executed by the assigning Lender and an Eligible
Assignee and a processing and recordation fee of $3,000
(payable by the assigning Lender or the assignee, as shall
be agreed between them), the Administrative Agent shall, if
such Assignment and Acceptance has been completed and is in
compliance with this Agreement and in substantially the form
of Exhibit A, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the
Borrower and the other Lenders.
(e) Participations. Each Lender may sell partici-
pations to one or more other financial institutions in or to
all or a portion of its rights and obligations under and in
respect of any and all facilities under this Agreement
(including, without limitation, all or a portion of any or
all of its Commitments hereunder and the Loans owing to it
and its undivided interest in the Letters of Credit);
provided, however, that (i) such Lender's obligations under
this Agreement (including, without limitation, its
Commitments hereunder) shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) the
Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations
under this Agreement and (iv) such participant's rights to
agree or to restrict such Lender's ability to agree to the
modification, waiver or release of any of the terms of the
Loan Documents or to the release of any Collateral covered
by the Loan Documents, to consent to any action or failure
to act by any party to any of the Loan Documents or any of
their respective Affiliates, or to exercise or refrain from
exercising any powers or rights which any Lender may have
under or in respect of the Loan Documents or any Collateral,
shall be limited to the right to consent to (A) increase in
the Commitment of the Lender from whom such participant
purchased a participation, (B) reduction of the principal
of, or rate or amount of interest on the Loans(s) subject to
such participation (other than by the payment or prepayment
thereof), (C) postponement of any date fixed for any payment
of principal of, or interest on, the Loan(s) subject to such
participation and (D) release of any guarantor of the
Obligations or all or a substantial portion of the
Collateral except as provided in Section 13.09(c).
(f) Payment to Participants. Anything in this Agree-
ment to the contrary notwithstanding, in the case of any
participation, all amounts payable by the Borrower under the
Loan Documents shall be calculated and made in the manner
and to the parties required hereby as if no such
participation had been sold; provided, however, that each
participant shall be the beneficiary of the provisions of
Article XIV to the extent amounts payable thereunder do not
exceed the amounts payable thereunder to the Lender from
which such participation has been purchased.
(g) Lenders' Creation of Security Interests.
Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security
interest in all or any portion of its rights under this
Agreement (including, without limitation, Obligations owing
to it and any Notes held by it) in favor of any Federal
Reserve bank in accordance with Regulation A of the Federal
Reserve Board.
(h) Assignments by Citicorp. If Citicorp ceases to be
a Lender under this Agreement by virtue of any assignment
made pursuant to this Section 15.01, then, as of the
effective date of such cessation, Citibank's obligations to
issue Letters of Credit pursuant to Section 3.01 shall
terminate and Citibank shall be an Issuing Bank hereunder
only with respect to outstanding Letters of Credit issued
prior to such date.
(i) Information Regarding the Borrower. Any Lender
may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this
Section 15.01, disclose to the assignee or participant or
proposed assignee or participant, any information relating
to the Borrower or its Subsidiaries furnished to such Lender
by the Administrative Agent or by or on behalf of the
Borrower; provided that, prior to any such disclosure, such
assignee or participant, or proposed assignee or
participant, shall agree to preserve in accordance with
Section 15.20 the confidentiality of any confidential
information described therein.
15.02. Expenses.
(a) Generally. The Borrower agrees upon demand to
pay, or reimburse the Administrative Agent for, all of the
Administrative Agent's reasonable internal and external
audit, legal, appraisal, valuation, filing, document
duplication and reproduction and investigation expenses and
for all other out-of-pocket costs and expenses of every type
and nature (including, without limitation, the reasonable
fees, expenses and disbursements of Sidley & Austin, local
legal counsel, auditors, accountants, appraisers, printers,
insurance and environmental advisers, and other consultants
and Administrative Agents) incurred by the Administrative
Agent in connection with (i) the Administrative Agent's
review and investigation of the Borrower and its Affiliates
and the Collateral in connection with the preparation,
negotiation, and execution of the Loan Documents and the
Administrative Agent's periodic reviews and audits of the
Borrower; (ii) the preparation, negotiation, execution and
interpretation of this Agreement (including, without
limitation, the satisfaction or attempted satisfaction of
any of the conditions set forth in Article VI) and the other
Loan Documents and the making of the Loans hereunder; (iii)
the creation, perfection or protection of the Liens under
the Loan Documents (including, without limitation, any
reasonable fees and expenses for local counsel in various
jurisdictions); (iv) the ongoing administration of this
Agreement, the other Loan Documents and the Loans, including
consultation with attorneys in connection therewith and with
respect to the Administrative Agent's rights and
responsibilities under this Agreement and the other Loan
Documents; (v) the protection, collection or enforcement of
any of the Obligations or the enforcement of any of the Loan
Documents; (vi) the commencement, defense or intervention in
any court proceeding relating in any way to the Obligations,
the Property, the Borrower, any of its Subsidiaries, this
Agreement or any of the other Loan Documents; (vii) the
response to, and preparation for, any subpoena or request
for document production with which the Administrative Agent
is served or deposition or other proceeding in which the
Administrative Agent is called to testify, in each case,
relating in any way to the Obligations, the Property, the
Borrower, any of its Subsidiaries, this Agreement or any of
the other Loan Documents; and (viii) any amendments,
consents, waivers, assignments, restatements, or supplements
to any of the Loan Documents and the preparation,
negotiation, and execution of the same.
(b) After Default. The Borrower further agrees to pay
or reimburse the Administrative Agent, the Issuing Banks and
the Lenders upon demand for all out-of-pocket costs and
expenses, including, without limitation, reasonable
attorneys' fees (including allocated costs of internal
counsel and costs of settlement) incurred by the
Administrative Agent, any Issuing Bank or any Lender after
the occurrence of an Event of Default (i) in enforcing any
Loan Document or Obligation or any security therefor or
exercising or enforcing any other right or remedy available
by reason of such Event of Default; (ii) in connection with
any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a "work-out"
or in any insolvency or bankruptcy proceeding; (iii) in
commencing, defending or intervening in any litigation or in
filing a petition, complaint, answer, motion or other
pleadings in any legal proceeding relating to the
Obligations, the Property, the Borrower or any of its
Subsidiaries and related to or arising out of the
transactions contemplated hereby or by any of the other Loan
Documents; and (iv) in taking any other action in or with
respect to any suit or proceeding (bankruptcy or otherwise)
described in clauses (i) through (iii) above.
15.03. Indemnity. The Borrower further agrees (a) to
defend, protect, indemnify, and hold harmless the
Administrative Agent and each and all of the Lenders and
Issuing Banks and each of their respective officers, direc-
tors, employees, attorneys and Administrative Agents
(including, without limitation, those retained in connection
with the satisfaction or attempted satisfaction of any of
the conditions set forth in Article VI) (collectively, the
"Indemnitees") from and against any and all liabilities,
obligations, losses (other than loss of profits), damages,
penalties, actions, judgments, suits, claims, costs,
expenses and disbursements of any kind or nature whatsoever
(excluding any taxes and including, without limitation, the
fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or
judicial proceeding, whether or not such Indemnitees shall
be designated a party thereto), imposed on, incurred by, or
asserted against such Indemnitees in any manner relating to
or arising out of (i) this Agreement or the other Loan
Documents, or any act, event or transaction related or
attendant thereto or to the transfers evidenced by the
Transfer Documents, the making of the Loans and the issuance
of and participation in Letters of Credit hereunder, the
management of such Loans or Letters of Credit, the use or
intended use of the proceeds of the Loans or Letters of
Credit hereunder, or any of the other transactions
contemplated by any of the Loan Documents, or (ii) any
Liabilities and Costs relating to any violation by the
Borrower, its Subsidiaries, or the Guarantors, or their
respective predecessors-in-interest of any Environmental,
Health or Safety Requirements of Law, the past, present or
future operations of the Borrower, its Subsidiaries, any
Guarantor, or any of their respective predecessors in
interest, or, the past, present or future environmental,
health or safety condition of any respective past, present
or future Property of the Borrower, any of its Subsidiaries,
or any Guarantor, the presence of asbestos-containing
materials at any respective past, present or future Property
of the Borrower, any of its Subsidiaries, or any Guarantor,
or the Release or threatened Release of any Contaminant into
the environment by the Borrower, its Subsidiaries, any
Guarantor, or their respective predecessors-in-interest, or
the Release or threatened Release of any Contaminant into
the environment from or at any facility to which the
Borrower, any of its Subsidiaries, or any Guarantor, or
their respective predecessors-in-interest sent or directly
arranged the transport of any Contaminant (collectively, the
"Indemnified Matters"); provided, however, the Borrower
shall have no obligation to an Indemnitee hereunder with
respect to Indemnified Matters caused by or resulting from
the willful misconduct or gross negligence of such
Indemnitee, as determined by a court of competent
jurisdiction and (b) not to assert any claim against any of
the Indemnified Parties on any theory of liability for
special, indirect, consequential or punitive damages arising
out of, or in any way in connection with, the Commitments,
the Obligations or any other matters governed by this
Agreement and/or the other Loan Documents. To the extent
that the undertaking to indemnify, pay and hold harmless set
forth in the preceding sentence may be unenforceable because
it is violative of any law or public policy, the Borrower
shall contribute the maximum portion which it is permitted
to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Matters incurred by the
Indemnitees. The Administrative Agent, Lenders and the
Issuing Banks agree to notify the Borrower of the
institution or assertion of any Indemnified Matter, but the
parties hereto hereby agree that the failure to so notify
the Borrower shall not release the Borrower from its
obligations hereunder.
15.04. Change in Accounting Principles. If any change
in the accounting principles used in the preparation of the
most recent Financial Statements referred to in Section 8.01
are hereafter required or permitted by the rules,
regulations, pronouncements and opinions of the Financial
Accounting Standards Board or the American Institute of
Certified Public Accountants (or successors thereto or
agencies with similar functions) and are adopted by the
Borrower with the agreement of its independent certified
public accountants and such changes result in a change in
the method of calculation of any of the covenants, standards
or terms found in Article IX, Article X, and Article XI, the
parties hereto agree to enter into negotiations in order to
amend such provisions so as to equitably reflect such
changes with the desired result that the criteria for
evaluating compliance with such covenants, standards and
terms by the Borrower shall be the same after such changes
as if such changes had not been made; provided, however, no
change in GAAP that would affect the method of calculation
of any of the covenants, standards or terms shall be given
effect in such calculations until such provisions are
amended, in a manner satisfactory to the Requisite Lenders
and the Borrower, to so reflect such change in accounting
principles.
15.05. Setoff. In addition to any Liens granted under
the Loan Documents and any rights now or hereafter granted
under applicable law, upon the occurrence and during the
continuance of any Event of Default, each Lender, each
Issuing Bank and any Affiliate of any Lender or Issuing Bank
is hereby authorized by the Borrower at any time or from
time to time, without notice to any Person (any such notice
being hereby expressly waived) to set off and to appropriate
and to apply any and all deposits (general or special,
including, but not limited to, indebtedness evidenced by
certificates of deposit, whether matured or unmatured (but
not including trust accounts)) and any other Indebtedness at
any time held or owing by such Lender, Issuing Bank or any
of their Affiliates to or for the credit or the account of
the Borrower against and on account of the Obligations of
the Borrower to such Lender, Issuing Bank or any of their
Affiliates, including, but not limited to, all Loans and
Letters of Credit and all claims of any nature or
description arising out of or in connection with this
Agreement, irrespective of whether or not (i) such Lender or
Issuing Bank shall have made any demand hereunder or (ii)
the Administrative Agent, at the request or with the consent
of the Requisite Lenders, shall have declared the principal
of and interest on the Loans and other amounts due hereunder
to be due and payable as permitted by Article XII and even
though such Obligations may be contingent or unmatured.
Each Lender and each Issuing Bank agrees that it shall not,
without the express consent of the Requisite Lenders, and
that it shall, to the extent it is lawfully entitled to do
so, upon the request of the Requisite Lenders, exercise its
setoff rights hereunder against any accounts of the
Borrower, any of its Subsidiaries, or Guarantor now or
hereafter maintained with such Lender, Issuing Bank or any
Affiliate of such Lender or Issuing Bank.
15.06. Ratable Sharing. The Lenders agree among them-
selves that (i) with respect to all amounts received by them
which are applicable to the payment of the Obligations
(excluding the fees described in Section 5.03 and Article
XIV), equitable adjustment will be made so that, in effect,
all such amounts will be shared among them ratably in
accordance with their Pro Rata Shares, whether received by
voluntary payment, by the exercise of the right of setoff or
banker's lien, by counterclaim or cross-action or by the
enforcement of any or all of the Obligations (excluding the
fees described in Section 5.03 and Article XIV) or the
Collateral, (ii) if any of them shall by voluntary payment
or by the exercise of any right of counterclaim, setoff,
banker's lien or otherwise, receive payment of a proportion
of the aggregate amount of the Obligations held by it, which
is greater than the amount which such Lender is entitled to
receive hereunder, the Lender receiving such excess payment
shall purchase, without recourse or warranty, an undivided
interest and participation (which it shall be deemed to have
done simultaneously upon the receipt of such payment) in
such Obligations owed to the others so that all such
recoveries with respect to such Obligations shall be applied
ratably in accordance with their Pro Rata Shares; provided,
however, that if all or part of such excess payment received
by the purchasing party is thereafter recovered from it,
those purchases shall be rescinded and the purchase prices
paid for such participations shall be returned to such party
to the extent necessary to adjust for such recovery, but
without interest except to the extent the purchasing party
is required to pay interest in connection with such
recovery. The Borrower agrees that any Lender so purchasing
a participation from another Lender pursuant to this
Section 15.06 may, to the fullest extent permitted by law,
exercise all its rights of payment (including, subject to
Section 15.05, the right of setoff) with respect to such
participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such
participation.
15.07. Amendments and Waivers. (a) General
Provisions. Unless otherwise provided for or required in
this Agreement, no amendment or modification of any
provision of this Agreement or any of the other Loan
Documents shall be effective without the written agreement
of the Requisite Lenders (which the Requisite Lenders shall
have the right to grant or withhold in their sole
discretion) and the Borrower. No termination or waiver of
any provision of this Agreement or any of the other Loan
Documents, or consent to any departure by the Borrower
therefrom, shall be effective without the written
concurrence of the Requisite Lenders, which the Requisite
Lenders shall have the right to grant or withhold in their
sole discretion. All amendments, modifications, waivers and
consents not specifically reserved to Lenders, Issuing
Banks, and the Administrative Agent in Section 15.07(b),
Section 15.07(c) and in other provisions of this Agreement
shall require only the approval of the Requisite Lenders.
Any waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it
was given. No notice to or demand on the Borrower in any
case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.
(b) Amendments, Consents and Waivers by Super-
Majority Lenders. Any amendment, modification, termination,
waiver or consent with respect to any of the provisions of
Section 4.01(b) of this Agreement shall be effective only by
a written agreement signed by the Super-Majority Lenders.
(c) Amendments, Consents and Waivers by All Lenders.
Any amendment, modification, termination, waiver or consent
with respect to any of the following provisions of this
Agreement shall be effective only by a written agreement,
signed by each Lender:
(i) increase in the amount of any of the Commitments
of such Lender,
(ii) reduction of the principal of, rate or amount of
interest on the Loans, the Reimbursement Obligations, or any
fees or other amounts payable to the Lenders or Issuing
Banks (other than by the payment or prepayment thereof),
(iii) postponement of the Revolving Credit Termination
Date, the Term Loan Termination Date or any date fixed for
any payment of principal of, or interest on, the Loans, the
Reimbursement Obligations or any fees or other amounts
payable to the Lenders or the Issuing Banks,
(iv) the orders of priority of applications set forth
in Section 4.01,
(v) change in the definitions of Revolving Credit
Commitments or Term Loan Commitments,
(vi) waiver of any of the conditions specified in
Sections 6.01 or 6.02 or the covenant set forth in Section
9.15,
(vii) release of any guarantor of the Obligations, the
Lien on the CM Notes or CM Letter of Credit, or all or a
substantial portion of the Collateral (except as provided in
Section 13.09(c)),
(viii) change in the (A) definitions of Requisite
Lenders Super-Majority Lenders or (B) the aggregate Pro Rata
Share of the Lenders which shall be required for the Lenders
or any of them to take action under this Agreement or the
other Loan Documents,
(ix) amendment of Section 15.01 or this Section 15.07,
(x) assignment of any right or interest in or under
this Agreement or any of the other Loan Documents by the
Borrower, and
(xi) waiver of any Event of Default described in
Sections 12.01(a), (f), (g), (h), and (n).
(d) Administrative Agent Authority. The
Administrative Agent may, but shall have no obligation to,
with the written concurrence of any Lender, execute
amendments, modifications, waivers or consents on behalf of
that Lender. Notwithstanding anything to the contrary
contained in this Section 15.07, no amendment, modification,
waiver or consent shall affect the rights or duties of the
Administrative Agent under this Agreement or the other Loan
Documents, unless made in writing and signed by the
Administrative Agent in addition to the Lenders required
above to take such action; and the order of priority set
forth in clauses (A) through (C) of Section 4.02(b) may be
changed only with the prior written consent of the
Administrative Agent. Notwithstanding anything herein to
the contrary, in the event that the Borrower shall have
requested, in writing, that any Lender agree to an
amendment, modification, waiver or consent with respect to
any particular provision or provisions of this Agreement or
the other Loan Documents, and such Lender shall have failed
to state, in writing, that it either agrees or disagrees (in
full or in part) with all such requests (in the case of its
statement of agreement, subject to satisfactory
documentation and such other conditions it may specify)
within thirty (30) days after such request, then such Lender
shall be deemed to not have approved such amendment,
modification, waiver or consent and the Administrative Agent
shall thereupon determine whether the Lenders required above
to take the requested action have approved the same within
the required time and communicate such determination to the
Borrower and the Lenders.
15.08. Notices. Unless otherwise specifically pro-
vided herein, any notice or other communication herein
required or permitted to be given shall be in writing and
may be personally served, sent by facsimile transmission or
courier service or United States certified mail and shall be
deemed to have been given when delivered in person or by
courier service, upon receipt of a facsimile transmission,
or four (4) Business Days after deposit in the United States
mail with postage prepaid and properly addressed. Notices
to the Administrative Agent pursuant to Articles II, IV or
XIII shall not be effective until received by the
Administrative Agent. For the purposes hereof, the
addresses of the parties hereto (until notice of a change
thereof is delivered as provided in this Section 15.08)
shall be as set forth below each party's name on the
signature pages hereof or the signature page of any
applicable Assignment and Acceptance, or, as to each party,
at such other address as may be designated by such party in
a written notice to all of the other parties to this
Agreement.
15.09. Survival of Warranties and Agreements. All
representations and warranties made herein and all covenants
and other obligations of the Borrower in respect of taxes,
indemnification and expense reimbursement shall survive the
execution and delivery of this Agreement and the other Loan
Documents, the making and repayment of the Loans, the
issuance and discharge of Letters of Credit hereunder and
the termination of this Agreement and shall not be limited
in any way by the passage of time or occurrence of any event
and shall expressly cover time periods when the
Administrative Agent, any of the Issuing Banks or any of the
Lenders may have come into possession or control of any of
the Borrower's or its Subsidiaries' Property.
15.10. Failure or Indulgence Not Waiver; Remedies
Cumulative. No failure or delay on the part of the
Administrative Agent, any Lender or any Issuing Bank in the
exercise of any power, right or privilege under any of the
Loan Documents shall impair such power, right or privilege
or be construed to be a waiver of any default or
acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right,
power or privilege. All rights and remedies existing under
the Loan Documents are cumulative to and not exclusive of
any rights or remedies otherwise available.
15.11. Marshalling; Payments Set Aside. None of the
Administrative Agent, any Lender or any Issuing Bank shall
be under any obligation to marshall any assets in favor of
the Borrower or any other Person or against or in payment of
any or all of the Obligations. To the extent that the
Borrower makes a payment or payments to the Administrative
Agent, the Lenders or the Issuing Banks or any of such
Persons receives payment from the proceeds of the Collateral
or exercises its rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or
any part thereof are subsequently invalidated, declared to
be fraudulent or preferential, set aside or required to be
repaid to a trustee, receiver or any other party, then to
the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, right
and remedies therefor, shall be revived and continued in
full force and effect as if such payment had not been made
or such enforcement or setoff had not occurred.
15.12. Severability. In case any provision in or
obligation under this Agreement or the other Loan Documents
shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not
in any way be affected or impaired thereby.
15.13. Headings. Section headings in this Agreement
are included herein for convenience of reference only and
shall not constitute a part of this Agreement or be given
any substantive effect.
15.14. Governing Law. THIS AGREEMENT SHALL BE
INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES
HERETO DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.
15.15. Limitation of Liability. No claim may be made
by the Borrower, any Lender, any Issuing Bank, the
Administrative Agent or any other Person against the
Administrative Agent, any other Issuing Bank or any other
Lender or the Affiliates, directors, officers, employees,
attorneys or agents of any of them for any special,
consequential or punitive damages in respect of any claim
for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring
in connection therewith; and each of the Borrower, each
Lender, each Issuing Bank and the Administrative Agent
hereby waives, releases and agrees not to sue upon any such
claim for any such damages, whether or not accrued and
whether or not known or suspected to exist in its favor.
15.16. Successors and Assigns. This Agreement and the
other Loan Documents shall be binding upon the parties
hereto and their respective successors and assigns and shall
inure to the benefit of the parties hereto and the
successors and permitted assigns of the Lenders and the
Issuing Banks. The rights hereunder of the Borrower, or any
interest therein, may not be assigned without the written
consent of all Lenders.
15.17. Certain Consents and Waivers of the Borrower.
(a) Personal Jurisdiction. (i) EACH OF THE
ADMINISTRATIVE AGENT, THE LENDERS, THE ISSUING BANKS AND THE
BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF
AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY
NEW YORK STATE COURT OR FEDERAL COURT SITTING IN NEW YORK,
NEW YORK, AND ANY COURT HAVING JURISDICTION OVER APPEALS OF
MATTERS HEARD IN SUCH COURTS, IN ANY ACTION OR PROCEEDING
ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, WHETHER ARISING
IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR RECOGNITION
OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES
HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN SUCH STATE COURT OR, TO THE EXTENT
PERMITTED BY LAW, IN SUCH FEDERAL COURT. THE BORROWER
IRREVOCABLY DESIGNATES AND APPOINTS TFC, 110 EAST 59TH
STREET, 30TH FLOOR, NEW YORK, NEW YORK 10022, AS ITS AGENT
(THE "PROCESS AGENT") FOR SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY
ACKNOWLEDGED TO BE EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT. EACH OF THE ADMINISTRATIVE AGENT, THE LENDERS, THE
ISSUING BANKS AND THE BORROWER AGREES THAT A FINAL JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. THE BORROWER WAIVES
IN ALL DISPUTES ANY OBJECTION THAT IT MAY HAVE TO THE
LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(ii) THE BORROWER AGREES THAT THE ADMINISTRATIVE AGENT
SHALL HAVE THE RIGHT TO PROCEED AGAINST THE BORROWER OR ITS
PROPERTY IN A COURT IN ANY LOCATION TO ENABLE THE
ADMINISTRATIVE AGENT, THE ISSUING BANKS AND THE LENDERS TO
REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER
ENTERED IN FAVOR OF THE ADMINISTRATIVE AGENT, ANY ISSUING
BANK OR ANY LENDER. THE BORROWER AGREES THAT IT WILL NOT
ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING
BROUGHT BY THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY
ISSUING BANK TO REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR
OTHER COURT ORDER IN FAVOR OF THE ADMINISTRATIVE AGENT, ANY
LENDER OR ANY ISSUING BANK. THE BORROWER WAIVES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN
WHICH THE ADMINISTRATIVE AGENT, ANY ISSUING BANK OR ANY
LENDER MAY COMMENCE A PROCEEDING DESCRIBED IN THIS SECTION.
(b) Service of Process. THE BORROWER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT OR THE
BORROWER'S NOTICE ADDRESS SPECIFIED BELOW, SUCH SERVICE TO
BECOME EFFECTIVE FIVE (5) DAYS AFTER SUCH MAILING. THE
BORROWER IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR
BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING
HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE
ADMINISTRATIVE AGENT TO BRING PROCEEDINGS AGAINST THE
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
(c) Waiver of Jury Trial. EACH OF THE ADMINISTRATIVE
AGENT, LENDERS, ISSUING BANKS, AND THE BORROWER IRREVOCABLY
WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT. ANY OF
THE BORROWER, THE ADMINISTRATIVE AGENT, LENDERS, OR ISSUING
BANKS MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT
OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY.
15.18. Counterparts; Effectiveness; Inconsistencies.
This Agreement and any amendments, waivers, consents, or
supplements hereto may be executed in counterparts, each of
which when so executed and delivered shall be deemed an
original, but all such counterparts together shall
constitute but one and the same instrument. This Agreement
shall become effective against the Borrower, each Lender,
each Issuing Bank and the Administrative Agent on the
Closing Date. This Agreement and each of the other Loan
Documents shall be construed to the extent reasonable to be
consistent one with the other, but to the extent that the
terms and conditions of this Agreement are actually
inconsistent with the terms and conditions of any other Loan
Document, this Agreement shall govern.
15.19. Limitation on Agreements. All agreements
between the Borrower, the Administrative Agent, each Lender
and each Issuing Bank in the Loan Documents are hereby
expressly limited so that in no event shall any of the Loans
or other amounts payable by the Borrower under any of the
Loan Documents be directly or indirectly secured (within the
meaning of Regulation U) by Margin Stock.
15.20. Confidentiality. Subject to Section 15.01(f),
the Lenders and the Issuing Banks shall hold all nonpublic
information obtained pursuant to the requirements of this
Agreement and identified as such by the Borrower in
accordance with such Lender's or such Issuing Bank's cus-
tomary procedures for handling confidential information of
this nature and in accordance with safe and sound banking
practices and in any event may make disclosure reasonably
required by a bona fide offeree, transferee or participant
in connection with the contemplated transfer or
participation or as required or requested by any
Governmental Authority or representative thereof or pursuant
to legal process and shall require any such offeree,
transferee or participant to agree (and require any of its
offerees, transferees or participants to agree) to comply
with this Section 15.20. In no event shall any Lender or
any Issuing Bank be obligated or required to return any
materials furnished by the Borrower; provided, however, each
offeree shall be required to agree that if it does not
become a transferee or participant it shall return all
materials furnished to it by the Borrower in connection with
this Agreement. Any and all confidentiality agreements
entered into between any Lender or any Issuing Bank and the
Borrower shall survive the execution of this Agreement.
15.21. Entire Agreement. This Agreement, taken
together with all of the other Loan Documents, embodies the
entire agreement and understanding among the parties hereto
and supersedes all prior agreements and understandings,
written and oral, relating to the subject matter hereof.
15.22. Advice of Counsel. The Borrower and each
Lender and Issuing Bank understand that the Administrative
Agent's counsel represents only the Administrative Agent's
and its Affiliates' interests and that the Borrower, other
Lenders and other Issuing Banks are advised to obtain their
own counsel. The Borrower represents and warrants to the
Administrative Agent and the other Holders that it has
discussed this Agreement with its counsel.
IN WITNESS WHEREOF, this Agreement has been duly exe-
cuted as of the date first above written.
BORROWER:
FAIRCHILD HOLDING CORP.
By: Karen L. Schneckenburger
Title: Vice President & Treasurer
Notice Address:
300 West Service Road
Chantilly, Virginia 22021
Attn: Michael T. Alcox
Telecopier No. (703) 478-5915 and
Donald E. Miller
Telecopier No. (703) 478-5775
with a copy to:
Cahill Gordon & Reindel
Eighty Pine Street
New York, New York 10005-1702
Attn: James J. Clark
Telecopier No. (212) 269-5420
ADMINISTRATIVE AGENT:
CITICORP USA, INC., as Administrative Agent
By: Marjorie Futornick
Title: Vice President
Notice Address:
Citicorp USA, Inc.
c/o Citicorp Securities, Inc.
200 South Wacker Drive
31st Floor
Chicago, Illinois 60606
Attn: Colin M. Cohen
Telecopier No. (312) 993-1050
with a copy to:
Sidley & Austin
One First National Plaza
Chicago, Illinois 60603
Attn: DeVerille A. Huston
Telecopier No. (312) 853-7036
ISSUING BANK:
CITIBANK, N.A.
By: David L. Hains
Title: Vice President
Notice Address:
Citibank, N.A.
399 Park Avenue
10th Floor, Zone 3
New York, New York 10043
Attn: Gail Rodriguez
Telecopier No. (212) 793-4806
LENDERS:
CITICORP USA, INC.
By: Marjorie Futornick
Title: Vice President
Notice Address:
Citicorp USA, Inc.
c/o Citicorp Securities, Inc.
200 South Wacker Drive
31st Floor
Chicago, Illinois 60606
Attn: Colin M. Cohen
Telecopier No. (312) 993-1050
Domestic Lending Office and Eurodollar
Lending Office or Eurodollar Affiliate:
Citicorp USA, Inc.
c/o Citibank, N.A.
399 Park Avenue
10th Floor, Zone 3
New York, New York 10043
Attn: Gail Rodriguez
Telecopier No. (212) 793-4806
Pro Rata Share: 43.75%
Term Loan Commitment: $13,125,000
Revolving Credit Commitment: $21,875,000
NATIONSBANK, N.A.
By: John D. Mindnick
Title: Senior Vice President
Notice Address
and Domestic and Eurodollar
Lending Office:
NationsBank, N.A.
6610 Rockledge Drive
1st Floor
Bethesda, Maryland 20817-1876
Attn: John Mindnich
Telecopier No. (301) 571-0719
Pro Rata Share: 18.75%
Term Loan Commitment: $ 5,625,000
Revolving Credit Commitment: $ 9,375,000
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By: Brady S. Sadek
Title: Vice President & Deputy General Manager
Notice Address
and Domestic and Eurodollar
Lending Office:
The Long-Term Credit Bank of Japan, Ltd.
190 South LaSalle Street
Suite 800
Chicago, Illinois 60603
Attn: Kris Grosshans
Telecopier No. (312) 704-8505
Pro Rata Share: 18.75%
Term Loan Commitment: $ 5,625,000
Revolving Credit Commitment: $ 9,375,000
CAISSE NATIONALE DE CREDIT AGRICOLE
By: David Bouhl F.V.P
Title: Head of Corporate Banking, Chicago
Notice Address
and Domestic Eurodollar
Lending Office:
Caisse Nationale de Credit Agricole
55 East Monroe Street
Suite 4700
Chicago, Illinois 60603
Attn: Roger H. Weis
Telecopier No. (312) 372-3724
Pro Rata Share: 6.25%
Term Loan Commitment: $ 1,875,000
Revolving Credit Commitment: $ 3,125,000
THE BANK OF NOVA SCOTIA
By: F.C.H. Ashby____________
Title: Senior Manager Loan Operations
Notice Address
and Domestic and Eurodollar
Lending Office:
The Bank of Nova Scotia
181 West Madison Street
Suite 3700
Chicago, Illinois 60602-4514
Attn: Michael Manick
Telecopier No. (312) 201-4108
Pro Rata Share: 6.25%
Term Loan Commitment: $ 1,875,000
Revolving Credit Commitment: $ 3,125,000
UNION BANK, as Lender and Issuing Bank
By: Kristine A. Kasselman
Title: Vice President
Notice Address
and Domestic and Eurodollar
Lending Office:
Union Bank
Multi-National Banking Dept.
445 S. Figueroa St.
12th Floor
Los Angeles, California 90071
Attn: Patrick Cassidy
Telecopier No. (213) 236-6701
and to:
Commercial Portfolio Administration
445 S. Figueroa St.
16th Floor
Los Angeles, California 90071
Attn: Kristine Kasselman
Telecopier No. (213) 236-7814
Pro Rata Share: 6.25%
Term Loan Commitment: $1,875,000
Revolving Credit Commitment $3,125,000
TABLE OF CONTENTS
ARTICLE I DEFINITIONS
1.01. Certain Defined Terms
1
1.02. Computation of Time Periods
30
1.03. Accounting Terms
31
1.04. Other Terms
31
ARTICLE II AMOUNTS AND TERMS OF LOANS
2.01. Term Loans
32
2.02. Revolving Credit Facility
33
2.03. Authorized Officers and Administrative Agents
36
2.04. Use of Proceeds of Loans
36
ARTICLE III LETTERS OF CREDIT
3.01. Letters of Credit
37
3.02 Transitional Provisions
44
3.03 Obligations Several
44
ARTICLE IV PAYMENTS AND PREPAYMENTS
4.01. Prepayments; Reductions in Commitments
45
4.02. Payments
47
4.03. Promise to Repay; Evidence of Indebtedness
52
4.04. Proceeds of Collateral; Concentration Account
Arrangements
52
4.05. Cash Collateral Account
54
4.06. Post-Default Withdrawals from the Concentration
Account and Cash Collateral Account
55
ARTICLE V INTEREST AND FEES
5.01. Interest on the Loans and other Obligations
57
5.02. Special Provisions Governing Eurodollar Rate Loans
59
5.03. Fees
61
ARTICLE VI CONDITIONS TO LOANS AND LETTERS OF
CREDIT
6.01. Conditions Precedent to the Initial Loans and
Letters of Credit
64
6.02. Conditions Precedent to All Subsequent Loans and
Letters
of Credit
66
ARTICLE VII REPRESENTATIONS AND
WARRANTIES
7.01. Representations and Warranties of the Borrower
68
ARTICLE VIII REPORTING COVENANTS
8.01. Financial Statements; Communications with Accountants
78
8.02. Events of Default
79
8.03. Lawsuits
79
8.04. Declaration of Dividends and Other Distributions
80
8.05. TFC/RHI Liquidity
80
8.06. Environmental Notices
80
8.07. Other Reports
81
8.08. Other Information
81
ARTICLE IX AFFIRMATIVE COVENANTS
9.01. Corporate Existence, Etc
82
9.02. Corporate Powers; Conduct of Business
82
9.03. Compliance with Laws, Etc.
82
9.04. Payment of Taxes and Claims; Tax Consolidation
82
9.05. Insurance
83
9.06. Inspection of Property; Books and Records;
Discussions 83
9.07. Insurance and Condemnation Proceeds
84
9.08. ERISA Compliance
84
9.09. Foreign Employee Benefit Plan Compliance
85
9.10. Collection Accounts
85
9.11. Maintenance of Property
85
9.12. Condemnation
85
9.13. Tax Allocation Agreement
85
9.14. Performance of Material Contracts
85
9.15. CM Note and CM Letter of Credit
86
9.16. Real Property
86
ARTICLE X NEGATIVE COVENANTS
10.01. Indebtedness
87
10.02. Sales of Assets
88
10.03. Liens
89
10.04. Investments
89
10.05. Accommodation Obligations
90
10.06. Restricted Junior Payments
90
10.07. Conduct of Business
91
10.08. Transactions with Shareholders and Affiliates
91
10.09. Restriction on Fundamental Changes
92
10.10. Sales and Leasebacks
92
10.11. Margin Regulations; Securities Laws
92
10.12. ERISA
92
10.13. Issuance of Equity Securities
93
10.14. Organizational Documents
94
10.15. Bank Accounts
94
10.16. Fiscal Year
94
ARTICLE XI FINANCIAL COVENANTS
11.01. Interest Coverage Ratio
95
11.02. Minimum EBITDA
95
11.03. Capital Expenditures
95
ARTICLE XII EVENTS OF DEFAULT; RIGHTS AND
REMEDIES
12.01. Events of Default
96
12.02. Rights and Remedies
100
ARTICLE XIII THE ADMINISTRATIVE AGENT
13.01. Appointment
102
13.02. Nature of Duties
102
13.03. Rights, Exculpation, Etc.
103
13.04. Reliance
104
13.05. Indemnification
104
13.06. Citicorp Individually
104
13.07. Successor Administrative Agents
105
13.08. Relations Among Lenders
105
13.09. Concerning the Collateral and the Loan Documents
106
ARTICLE XIV YIELD PROTECTION
14.01. Taxes
109
14.02. Increased Capital
111
14.03. Changes; Legal Restrictions
112
14.04. Illegality
113
14.05. Compensation
113
14.06. Limitation on Additional Amounts Payable by the
Borrower
114
14.07. Change in Lending Office
114
ARTICLE XV MISCELLANEOUS
15.01. Assignments and Participations
115
15.02. Expenses
117
15.03. Indemnity
119
15.04. Change in Accounting Principles
120
15.05. Setoff
120
15.06. Ratable Sharing
121
15.07. Amendments and Waivers
121
15.08. Notices
123
15.09. Survival of Warranties and Agreements
124
15.10. Failure or Indulgence Not Waiver; Remedies
Cumulative124
15.11. Marshalling; Payments Set Aside
124
15.12. Severability
125
15.13. Headings
125
15.14. Governing Law
125
15.15. Limitation of Liability
125
15.16. Successors and Assigns
125
15.17. Certain Consents and Waivers of the Borrower
125
15.18. Counterparts; Effectiveness; Inconsistencies
127
15.19. Limitation on Agreements
127
15.20. Confidentiality
127
15.21. Entire Agreement
128
15.22. Advice of Counsel
128
EXHIBITS
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Collection Account Agreement
Exhibit C-1 -- Form of Revolving Credit Note
Exhibit C-2 -- Form of Term Loan Note
Exhibit D -- Form of Notice of Borrowing
Exhibit E -- Form of Notice of Conversion/Continuation
Exhibit F -- Pro Forma Financial Statements
Exhibit G -- Projections
Exhibit H -- List of Closing Documents
Exhibit I -- Form of Officer's Certificate to Accompany
Reports
Exhibit J -- Form of TFC/RHI Liquidity Calculation
SCHEDULES
Schedule 1.01.1 -- Domestic Subsidiaries
Schedule 1.01.2 -- Guarantors
Schedule 1.01.3 -- Permitted Equity Securities Options
Schedule 1.01.4 -- Permitted Existing Accommodation
Obligations
Schedule 1.01.5 -- Permitted Existing Indebtedness
Schedule 1.01.6 -- Permitted Existing Investments
Schedule 1.01.7 -- Permitted Existing Liens
Schedule 1.01.8 -- Refinanced Indebtedness
Schedule 3.01-A -- Letter of Credit Exceptions
Schedule 3.02 -- Existing Letters of Credit
Schedule 7.01-A -- Organizational Documents
Schedule 7.01-C -- Organizational Structure
Schedule 7.01-E -- Governmental Consents
Schedule 7.01-K -- Pending Actions
Schedule 7.01-R -- Environmental Matters
Schedule 7.01-S -- ERISA Matters
Schedule 7.01-U -- Labor Contracts
Schedule 7.01-X -- Patent, Trademark & Permit Claims
Pending
Schedule 7.01-Z -- Insurance Policies
Schedule 10.15 -- Collection Accounts
Schedule 12.01-Q -- TFC Permitted Existing Investments