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CREDIT AGREEMENT
Dated as of April 20, 1999
among
THE FAIRCHILD CORPORATION
as Borrower
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS LENDERS
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS ISSUING BANKS
CITICORP USA, INC.
as an Administrative Agent
and Collateral Agent
NATIONSBANK, N.A.
as an Administrative Agent
and
CREDIT SUISSE FIRST BOSTON
as Documentation Agent
and
SALOMON SMITH BARNEY INC.
and
NATIONSBANC MONTGOMERY SECURITIES, LLC
as Co-Arrangers
and
as Co-Book
Managers
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ARTICLE IDEFINITIONS1.01. Certain Defined Terms 1
1.02. Computation of Time Periods. 39
1.03. Accounting Terms; Financial Term Definitions. 40
1.04. Other Terms. 40
1.05. Dollar Equivalents. 40
ARTICLE IIAMOUNTS AND TERMS OF LOANS2.01. Revolving Credit,
Term Loan and Swing Loan
Facilities. 40
2.02. General Terms. 43
2.03. Authorized Officers and Collateral Agent. 46
2.04. Use of Proceeds of Loans. 46
ARTICLE IIILETTERS OF CREDIT3.01. Letters of Credit. 47
3.02. Transitional Provisions. 54
3.03. Obligations Several. 54
ARTICLE IVPAYMENTS AND PREPAYMENTS4.01. Prepayments;
Reductions in Commitments.55
4.02. Payments. 58
4.03. Promise to Repay; Evidence of Indebtedness. 63
4.04. Proceeds of Collateral; Concentration Account
Arrangements. 64
4.05. Cash Collateral Account. 65
4.06. Post-Default Withdrawals from the Concentration
Account and Cash Collateral Account. 66
ARTICLE VINTEREST AND FEES5.01. Interest on the Loans and
other Obligations. 68
5.02. Special Provisions Governing Eurodollar Rate Loans. 70
5.03. Fees. 72
5.04. Determination of Applicable Base Rate Margin,
Eurodollar Rate Margin and Commitment Fee Rate. 74
ARTICLE VICONDITIONS TO LOANS AND LETTERS OF CREDIT6.01.
Conditions Precedent to the Initial Loans and Letters of
Credit. 75
6.02. Conditions Precedent to All Loans and Letters of
Credit. 77
ARTICLE VIIREPRESENTATIONS AND WARRANTIES7.01.
Representations and Warranties of the Borrower. 79
ARTICLE VIII REPORTING COVENANTS
8.01. Financial Statements; Communications with
Accountants. 89
8.02. Events of Default. 91
8.03. Lawsuits. 91
8.04. Environmental Notices 92
8.05. Other Reports and Information. 93
8.06. Unrestricted Subsidiaries. 93
8.07. Corporate Organization; Indebtedness for
Borrowed Money. 94
ARTICLE IX AFFIRMATIVE COVENANTS
9.01. Corporate Existence, Etc. 95
9.02. Corporate Powers; Conduct of Business. 95
9.03. Compliance with Laws, Etc. 95
9.04. Payment of Taxes and Claims; Tax Consolidation. 95
9.05. Insurance. 96
9.06. Inspection of Property; Books and Records;
Discussions. 96
9.07. Insurance and Condemnation Proceeds.. 97
9.08. ERISA Compliance. 97
9.09. Foreign Employee Benefit Plan Compliance 98
9.10. Maintenance of Property. 98
9.11. Condemnation. 98
9.12. Subsidiaries Acquired or Formed after the
Closing Date; Guarantors. 98
9.13. Performance of Material Contracts. 98
9.14. Further Assurances. 99
9.15. Use of Proceeds of the Term Loans and the Senior
Notes. 99
9.16. Required Hedge Agreements. 99
9.17. Year 2000. 99
ARTICLE X NEGATIVE COVENANTS
10.01. Indebtedness. 101
10.02. Sales of Assets. 103
10.03. Liens. 105
10.04. Investments. 106
10.05. Restricted Junior Payments. 108
10.06. Restriction on Fundamental Changes. 109
10.07. Conduct of Business; Accounting and Reporting
Practices. 109
10.08. Transactions with Shareholders and Affiliates. 110
10.09. Sales and Leasebacks. 110
10.10. Margin Regulations; Securities Laws. 110
10.11. ERISA. 110
10.12. Issuance of Equity Securities. 111
10.13. Organizational Documents; Material Contractual
Obligations. 112
10.14. Bank Accounts. 112
10.15. Fiscal Year; Fiscal Quarters. 112
ARTICLE XI FINANCIAL COVENANTS
11.01. Interest Coverage Ratio. 113
11.02. Capital Expenditures. 113
11.03. Consolidated Senior Indebtedness to EBITDA Ratio. 114
11.04. Consolidated Indebtedness to EBITDA Ratio. 114
11.05. Minimum Consolidated Fixed Charge Coverage Ratio. 114
11.06. EBITDA Calculations. 115
ARTICLE XIIEVENTS OF DEFAULT; RIGHTS AND REMEDIES
12.01. Events of Default. 116
12.02. Rights and Remedies. 119
ARTICLE XIIITHE ADMINISTRATIVE AGENTS AND COLLATERAL AGENT
13.01. Appointment. 122
13.02. Nature of Duties. 122
13.03. Rights, Exculpation, Etc. 123
13.04. Reliance. 124
13.05. Indemnification. 124
13.06. Citicorp Individually. 124
13.07. Successor Collateral Agents 125
13.08. Relations Among Lenders 125
13.09. Concerning the Collateral and the Loan Documents. 126
ARTICLE XIVYIELD PROTECTION14.01. Taxes. 129
14.02. Increased Capital. 131
14.03. Changes; Legal Restrictions. 132
14.04. Illegality. 133
14.05. Compensation. 133
14.06. Limitation on Additional Amounts Payable by
the Borrower. 134
14.07. Change in Lending Office. 134
14.08. Judgment Currency. 134
ARTICLE XVMISCELLANEOUS15.01. Assignments and
Participations. 136
15.02. Expenses. 139
15.03. Indemnity. 140
15.04. Change in Accounting Principles 141
15.05. Setoff. 141
15.06. Ratable Sharing. 142
15.07. Amendments and Waivers 143
15.08. Notices. 145
15.09. Survival of Warranties and Agreements. 145
15.10. Failure or Indulgence Not Waiver; Remedies
Cumulative. 145
15.11. Marshalling; Payments Set Aside. 145
15.12. Severability. 146
15.13. Headings. 146
15.14. Governing Law. 146
15.15. Limitation of Liability. 146
15.16. Successors and Assigns. 146
15.17. Certain Consents and Waivers of the Borrower. 147
15.18. Counterparts; Effectiveness; Inconsistencies. 148
15.19. Limitation on Agreements. 148
15.20. Confidentiality. 148
15.21. Entire Agreement. 149
15.22. Advice of Counsel. 149
CREDIT AGREEMENT
This Credit Agreement dated as of April 20, 1999 (as
amended, supplemented or modified from time to time, the "Agree-
ment") is entered into among The Fairchild Corporation, 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 or by
appointment as provided in this Agreement, Citicorp USA, Inc., a
Delaware corporation ("Citicorp"), in its capacity as an
administrative agent for the Lenders and the Issuing Banks
hereunder (in such capacity, an "Administrative Agent") and as
the collateral agent for the Lenders and the Issuing Banks
hereunder (in such capacity, the "Collateral Agent"),
NationsBank, N.A., a national banking association, in its
capacity as an administrative agent for the Lenders and the
Issuing Banks hereunder (in such capacity, an "Administrative
Agent"), and Credit Suisse First Boston, a bank organized under
the laws of Switzerland, acting through its New York Branch, in
its capacity as documentation agent hereunder (in such capacity,
the "Documentation 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 Obliga-
tion, 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 includ-ing,
without limitation, direct and indirect guarantees, endorse-ments
(except for collection or deposit in the ordinary course of busi-
ness), 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
dis-charge 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
Accom-modation Obligation shall be equal to the amount of the
Indebtedness, obliga-tion 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, obliga-tion 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 Obliga-
tion or the value at which such asset or assets would, in con-
formity with GAAP, be reflected on or valued for the purposes of
preparing a consolidated balance sheet of such Person as at such
determination date; (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 liabil-
ity 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; and (iii) in the event the Person incurring
the Accommodation Obligation has no obligation thereunder which
is dischargeable by the payment of money, such Accommodation
Obligation shall not be included for purposes of determining
compliance with the provisions of Section 10.01.
"Administrative Agent" means each of Citicorp and
NationsBank and "Administrative Agents" means Citicorp and
NationsBank, collectively.
"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. For purposes of this definition as it pertains to
Lenders, "Affiliate" shall include, with respect to any Term
Lender that is a fund that invests in commercial loans, any other
fund that invests in commercial loans and is managed or advised
by the same investment advisor as such Term Lender or by an
Affiliate of such investment advisor.
"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 Collateral Agent in connection with an
assignment of a Lender's or Issuing Bank's interest under this
Agreement in accordance with the provisions of Section 15.01.
"Availability" means, at any time of determination
thereof, the amount by which the Revolving Credit Commitments at
such time exceed the sum of (a) the Revolving Credit Obligations
at such time plus (b) the outstanding balance of Protective
Advances at such time plus (c) the Swing Loan Reserve.
"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.
"Banner" means Banner Aerospace, Inc., a Delaware
corporation.
"Banner Companies" means, collectively, those Persons
and investments in Persons identified on Schedule 1.01.5 under
the heading "Banner Aerospace, Inc." and their respective Capital
Stock and assets; and "Banner Company" means any of the Banner
Companies, individually.
"Banner Credit Agreement" means that certain Second
Amended and Restated Credit Agreement dated as of December 12,
1996, as amended, among Banner, certain of its Subsidiaries,
Citicorp, as administrative agent, Citicorp and NationsBank as
lenders, and Citibank, as issuing bank thereunder.
"Banner Distribution" means, collectively, that certain
dividend paid by Banner to the Borrower and that certain
intercompany loan made by Banner to the Borrower, in each event
after the Banner Exchange and on or before the Closing Date and
in an aggregate amount of approximately $115,000,000.
"Banner Exchange" means the merger of MTA, Inc., a
Wholly-Owned Subsidiary of the Borrower, with and into Banner
(with Banner being the surviving corporation), whereupon each
share of common stock, par value $1.00 per share, of Banner
issued and outstanding immediately prior to the effective time of
such merger not owned by the Borrower or any Affiliate of the
Borrower was converted into the right to receive a certain number
of validly issued, fully paid and nonassessable shares of common
stock, par value $0.10 per share, of the Borrower, as more
particularly described in the Banner Exchange Proxy.
"Banner Exchange Proxy" means that certain Proxy
Statement of Banner dated March 25, 1999.
"Base Eurodollar Rate" means, with respect to any
Eurodollar Interest Period applicable to a Borrowing of
Eurodollar Rate Loans, the rate of interest per annum determined
by the Collateral Agent to be the offered rate per annum at which
deposits in Dollars appears on Telerate page 3750 (or any
successor page) as of 11:00 a.m. (London time), or in the event
such offered rate is not available from the Telerate page, the
rate offered on deposits in Dollars by Citibank's London Office
to prime banks in the London interbank market at 11:00 a.m.
(London time), on the Eurodollar Interest Rate Determination Date
for such Eurodollar Interest Period and in an amount
substantially equal to the amount of the Eurodollar Rate Loan to
be outstanding from 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 higher
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 and Base Rate
Margin as provided in Section 5.01(a).
"Base Rate Margin" means, as of any date of
determination, a per annum rate equal to the rate set forth below
opposite the then attained compliance with a Consolidated
Indebtedness to EBITDA Ratio, for the then most recently ended
four (4) Fiscal Quarter period, by the Borrower and its
Subsidiaries, on a consolidated basis, measured as of the end of
each Fiscal Quarter commencing with the Fiscal Quarter ending
December 27, 1999:
Consolidated
Indebtedness to Revolver Base
EBITDA Ratio Rate Margin
Less than 3.50 to 1.00 0.75%
Less than 4.25 to 1.00 and equal 1.25%
to or greater than 3.50 to 1.00
Less than 5.00 to 1.00 and equal 1.50%
to or greater than 4.25 to 1.00
Less than 5.75 to 1.00 and equal 1.75%
to or greater than 5.00 to 1.00
Equal to or greater than 5.75 to 2.25%
1.00
Consolidated
Indebtedness to Term Base
EBITDA Ratio Rate Margin
Less than 4.25 to 1.00 1.75%
Less than 5.00 to 1.00 and equal 2.00%
to or greater than 4.25 to 1.00
Equal to or greater than 5.00 to 2.25%
1.00
provided, however, that, notwithstanding the foregoing, the
Revolver Base Rate Margin during the period commencing on the
Closing Date and ending on March 31, 2000 shall be equal to two
percent (2.00%) per annum and the Term Base Rate Margin during
the period commencing on the Closing Date and ending on March 31,
2000 shall be equal to two and one-quarter percent (2.25%) 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 hereto.
"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 govern-
mental action to close (i) in New York, New York, (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
adminis-tra-tion of the pertinent Letter of Credit is located.
"Capital Expenditures" means, for any period and
without duplication, the aggre-gate of all expenditures made
(whether paid in cash or other Property) or accrued as a
liability during such period that, in conformity with GAAP, are
required to be included in or reflected in the fixed asset
accounts of the consolidated balance sheet of the 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 consol-idated balance sheet of the Borrower
and its Sub-sidi-aries, (ii) Capital Expenditures shall exclude,
whether or not such a designation would be in conformity with
GAAP, (a) expenditures made in con-nec-tion with the replacement
or restora-tion 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, (b)
expenditures which would otherwise be included as aforesaid which
are expenditures made by an Unrestricted Subsidiary or by any
Technologies Company, whether or not then an Unrestricted
Subsidiary, and (c) expenditures which would otherwise be
included as aforesaid which are expenditures made with respect to
completion of development of the Farmingdale Property, and (iii)
such expenditures made in any Fiscal Year shall be net of any
proceeds of sales of Equipment by the Borrower and its
Subsidiaries.
"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 ex-
change 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 Collateral Agent, an Issuing Bank, 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 Collateral Agent into which Cash Collateral shall be
deposited. The Cash Collateral Account shall be under the sole
dominion and control of the Collateral Agent, provided that all
amounts deposited therein shall be held by the Collateral 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 uncondi-tionally guaranteed by the United
States govern-ment 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, are rated
either A-1 (or better) by Standard & Poor's Rating Group, a
division of McGraw-Hill, Inc. ("S&P") or P-1 (or better) by
Moody's Investors Service, Inc. (or if not then rating such
obligations, the highest rating obtainable from such other
nationally recognized rating services as are reasonably
acceptable to the Collateral Agent); (iii) commercial paper
which, at the time of acquisition thereof, is rated either A-1
(or better) by S&P or P-1 (or better) by Moody's Investors
Service, Inc. (or if not then rating such obligations, the
highest rating obtainable from such other nationally or
internationally recognized rating services as are reasonably
acceptable to the Collateral Agent); (iv) domestic or European
certificates of deposit and time deposits, bankers' acceptances
and floating rate certificates of deposit issued by any
commercial bank organized under the laws of the United States,
any state thereof, the District of Columbia or any member state
of the European Union 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 Service, Inc. (or if not then rating such obligations,
the highest rating obtainable from such other nationally or
internationally recognized rating services as are reasonably
acceptable to the Collateral Agent); (v) any agreement involving
U.S. Government securities, certificates of deposit or "eligible"
bankers' acceptances which provides for the transfer of such
securities against payment in funds and which contains an
agreement by the seller to repurchase the securities at a
specified date not more than ninety (90) days after the date of
such agreement; and (vi) freely redeemable shares in money market
funds which money market funds, at the time of acquisition, are
rated either A-1 (or better) by S&P or P-1 (or better) by Moody's
Investors Service, Inc. (or if not then rating such obligations,
the highest rating obtainable from such other nationally or
internationally recognized rating services as are reasonably
acceptable to the Collateral Agent); provided, that the
maturities of such Cash Equiva-lents shall not exceed ninety (90)
days.
"Cash Interest Expense" means, for the Borrower and its
Subsidiaries for any period, total interest expense of the
Borrower and its Subsidiaries, which is payable in cash, whether
paid or accrued, but without duplication, net of (i) the
difference between payments received by the Borrower and
Restricted Subsidiaries on all Hedge Agreements and payments made
by the Borrower and Restricted Subsidiaries on all Hedge
Agreements, (ii) interest income received in cash by the Borrower
and Restricted Subsidiaries and (iii) total interest expense of
Unrestricted Subsidiaries; (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 excluding, interest expense
not payable in cash (including amortization of discount and fees)
and interest expense with respect to liabilities which are not
Indebtedness for Borrowed Money), all as determined in conformity
with GAAP except to the extent adjustments with respect to Hedge
Agreements would not be 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 any of (i) any "person" or
"group" (as such terms are used in Sections 13(d) and 14(d) of
the Securities Exchange Act), other than one or more Permitted
Holders becomes the "beneficial owner" (as defined in Rules 13d-3
and 13d-5 under the Securities Exchange Act), directly or
indirectly, of more than forty percent (40%) of the total voting
power of the Voting Stock of the Borrower; provided, however,
that the Permitted Holders beneficially own (as defined above),
directly or indirectly, in the aggregate a lesser percentage of
the total voting power of the Voting Stock of the Borrower than
such other Person and do not have the right or ability by voting
power, contract or otherwise to elect or designate for election a
majority of the Board of Directors of the Borrower; or (ii)
during any period of two (2) consecutive years, individuals who
at the beginning of such period constituted the Board of
Directors of the Borrower (together with any new directors whose
election by such Board of Directors or whose nomination for
election by the stockholders of the Borrower was approved
pursuant to the vote of 66 2/3% of the directors of the Borrower
then still in office who were either directors at the beginning
of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Borrower then in
office; or (iii) the merger or consolidation of the Borrower with
or into another Person (other than a Permitted Holder) or the
merger of another Person (other than a Permitted Holder) with or
into the Borrower, or the sale of all or substantially all of the
assets of the Borrower to another Person (other than a Permitted
Holder), and, in the case of any such merger or consolidation,
the Capital Stock of the Borrower that is outstanding immediately
prior to such transaction and that represents 100% of the
aggregate voting power of the Voting Stock of the Borrower is
changed into or exchanged for cash, Securities or property,
unless pursuant to such transaction such Securities are changed
into or exchanged for, in addition to other consideration,
Securities of the surviving Person that represent, immediately
after such transaction, at least a majority of the aggregate
voting power of the Voting Stock of the surviving corporation.
"Citibank" means Citibank, N.A., a national banking
association.
"Citicorp" is defined in the preamble hereto.
"Claim" means any claim or demand, by any Person, of
whatsoever kind or nature for any alleged Liabili-ties 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 April 20, 1999.
"Collateral" means all property and interests in prop-
erty now owned or hereafter acquired by the Borrower or any
Subsidiary of the Borrower upon which a Lien is granted under any
of the Loan Documents.
"Collateral Agent" means Citicorp and each successor
Collateral Agent appointed pursuant to the terms of Article XIII.
"Collection Account" means each lock-box and blocked
depository account maintained by the Borrower or any Guarantor
subject to a Collection Account Agreement for the collection of
Receivables and other proceeds of Collateral.
"Collection Account Agreement" means a written
agreement, in form and substance satisfactory to the Collateral
Agent, granting the Collateral Agent certain rights with respect
to proceeds of Collateral deposited in the subject Collection
Account and executed by the Borrower or a Guarantor, the
Collateral Agent, and the respective bank at which the Borrower
or such Guarantor 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
Guarantor or any Subsidiary of the Borrower 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, a Guarantor, or such Subsidiary of the Borrower
in the ordinary course of its busi-ness.
"Commission" means the Securities and Exchange Commis-
sion and any Person succeeding to the functions thereof.
"Commitment" means, with respect to a given Lender, the
sum of such Lender's Revolving Credit Commitment plus such
Lender's Term Loan Commitment.
"Commitment Fee" is defined in Section 5.03(c).
"Commitment Fee Rate" means (i) one-half of one percent
(0.5%) per annum in the event the Revolving Credit Obligations
equal or exceed fifty percent (50%) of the Revolving Credit
Commitments and (ii) three-quarters of one percent (0.75%) per
annum in the event the Revolving Credit Obligations are less than
fifty percent (50%) of the Revolving Credit Commitments.
"Commitment Letter" means that certain commitment
letter addressed to the Borrower from Salomon Smith Barney Inc.,
NationsBanc Montgomery Securities, Inc., NationsBank, N.A., and
Credit Suisse First Boston dated March 17, 1999.
"Compliance Certificate" is defined in Section
8.01(d)(ii).
"Concentration Account" means a depository account
maintained at Citibank in New York, New York, or such other
financial institution designated for such purpose by the
Collateral Agent into which collections of Receivables of the
Borrower and the 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.
"Consolidated Fixed Charge Coverage Ratio" means, for
any period, the ratio of (i) EBITDA for such period minus Capital
Expenditures made in such period to (ii) the sum of (a) Cash
Interest Expense for such period plus (b) the amount of all
scheduled principal payments paid in such period by the Borrower
and its Subsidiaries (other than Unrestricted Subsidiaries).
"Consolidated Indebtedness to EBITDA Ratio" means, for
any period, the ratio of (i) Consolidated Total Debt as of the
last day of such period to (ii) EBITDA for such period.
"Consolidated Senior Indebtedness to EBITDA Ratio"
means, for any period, the ratio of (i) Consolidated Total Senior
Debt as of the last day of such period to (ii) EBITDA for such
period.
"Consolidated Total Debt" means the amount equal to (i)
the principal amount of total funded debt of the Borrower and its
Subsidiaries, to the extent the same would be reflected on a
balance sheet of the Borrower and its Subsidiaries prepared in
accordance with GAAP, plus (ii) the principal amount of total
debt attributable to discontinued operations of the Restricted
Subsidiaries, to the extent the same would be reflected on a
balance sheet of the Restricted Subsidiary the operations of
which have been discontinued, prepared in accordance with GAAP,
minus (iii) total debt of Unrestricted Subsidiaries to the extent
the same would be reflected on a balance sheet of the Borrower
and its Subsidiaries prepared in accordance with GAAP, and minus
(iv) the amount of cash and Cash Equivalents of the Borrower and
its Subsidiaries (other than Unrestricted Subsidiaries) reflected
on a balance sheet of the Borrower and its Subsidiaries.
"Consolidated Total Senior Debt" means the amount equal
to (i) the Consolidated Total Debt minus (ii) the principal
amount outstanding under the Senior Subordinated Notes or, in the
event the Senior Subordinated Notes are permitted under the terms
of this Agreement to be, and are, refinanced on terms and
conditions no less favorable to the interests of the Lenders than
the terms pursuant to which the Senior Subordinated Notes have
been issued, the principal amount outstanding under such
Indebtedness refinancing the Senior Subordinated Notes minus
(iii) the principal amount outstanding with respect to
Indebtedness for Borrowed Money which is permitted to be incurred
under the terms of Section 10.01 and is subordinated to or pari
passu with the Indebtedness for Borrowed Money described in
clause (ii) above.
"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 inden-ture, 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.
"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 compen-sation,
unemploy-ment 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
opera-tion of their respective businesses, and (B) all
Liens of attachment or judgment and Liens securing
bonds to stay judgments or in con-nec-tion with appeals
do not secure at any time an aggre-gate amount
exceeding $1,000,000; and
(iv) Liens arising with respect to zoning
restrictions, easements, licenses, reservations,
covenants, rights-of-way, utility ease-ments, building
restrictions and other similar charges or encumbrances
on the use of Real Property which do not materially
interfere with the ordinary conduct of the business of
the Borrower or any of the Borrower's Subsidiaries.
"Deposit Account" means a demand, time, savings,
passbook or like account with a bank, savings and loan
association, credit union, brokerage house, or like organization,
other than an account evidenced by a negotiable certificate of
deposit.
"Designated Prepayment" means each mandatory prepayment
required by clauses (i) - (iv) of Section 4.01(b).
"DOL" means the United States Department of Labor and
any Person succeeding to the functions thereof.
"Dollars" and "$" 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 Lend-ing 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 Collateral Agent.
"Domestic Subsidiaries" means those Subsidiaries of the
Guarantors or the Borrower domiciled within the United States of
America, its states, districts and possessions.
"EBITDA" means, for any period, the amount calculated,
without duplication, for such period as the sum of amounts for
such period of the Borrower's and its Subsidiaries' (other than
Unrestricted Subsidiaries' and the Technologies
Companies'(whether or not the same are Unrestricted
Subsidiaries)) net income plus (to the extent deducted in
calculating net income):
(a) income tax expense (or minus income tax benefits)
(b) interest expense (net of interest income)
(c) depreciation expense and amortization expense
(d) the amount of all other non-cash charges (less non-
cash credits), subtracting therefrom (adding thereto)
the amount of all cash payments (receipts) in such
period arising from non-cash charges (credits) added
back (deducted from) in any previous period
(e) the amount of all cash distributions from
Unrestricted Subsidiaries to the Borrower and
Restricted Subsidiaries to the extent such
distributions do not decrease the amount of
Unrestricted Subsidiaries Net Investment Amount
permitted under Section 8.06
(f) the amount of all bonuses in an amount not to
exceed the amount thereof disclosed in the Projections
and paid on or before June 30, 2000 to executive
officers of the Borrower and Restricted Subsidiaries in
connection with the Kaynar Acquisition and
(g) the amount of all severance, rationalization,
product qualification and other non-recurring
transition costs incurred in connection with the Kaynar
Acquisition in an aggregate amount not to exceed
$20,000,000.
Net income shall exclude (to the extent included above):
(1) the amount of any gain or loss realized upon the
sale or other disposition of any assets of the Borrower, its
consolidated Subsidiaries or any other Person which is not sold
or otherwise disposed of in the ordinary course of its operating
businesses and any gain or loss realized upon the sale or other
disposition of any Capital Stock of any Person; and
(2) the amount of the non-recurring cumulative effect
of a change in accounting principles.
"Eligible Assignee" means (i) a Lender or any Affiliate
thereof; (ii) a com-mercial 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 com-pany,
other financial insti-tution or fund, which is regularly engaged
in making, purchasing or investing in loans and having total
assets in excess of $300,000,000 or is otherwise acceptable to
the Collateral Agent.
"Eligible Marketable Securities" means (i) equity
Securities of a corporation the Securities of which are (or were
at the date of acquisition) included in the S&P 500 Index and
freely tradable upon issuance, (ii) freely tradable debt
Securities which have (or had at the date of acquisition) an
investment grade rating, and (iii) a freely tradable mutual fund
which invests substantially all of its assets in such equity
Securities and/or debt Securities; in each instance where held by
a securities intermediary, subject to an account control
agreement in form and substance satisfactory to the Collateral
Agent. The term "freely tradable" shall mean freely tradable
under the Securities Act (including pursuant to Rule 145(d)(1)
thereunder).
"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
Con-taminant into the environ-ment.
"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 FHC;
(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 FHC; and
(iii) a member of the same affiliated service group (within the
meaning of Section 414(m) of the Internal Revenue Code) as FHC,
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 failure 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 signature pages of 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 Collateral Agent.
"Eurodollar Interest Payment Date" means, with respect
to any Eurodollar Rate Loan, the last day of each Eurodollar
Inter-est Period applicable to such Loan and, if such applicable
Eurodollar Interest Period is longer than three (3) months in
duration, on the first Business Day of each successive three (3)
month period commencing with the first such day following the day
on which such Eurodollar Rate Loan was made, continued or
converted and ending with the first Business Day of the three (3)
month period ending on the last day of the applicable Eurodollar
Interest Period.
"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 signature pages
of the Assignment and Acceptance by which it became a Lender (or,
if no such office is specified, its Domestic Lending Office), or
such office or offices of such Lender as it may from time to time
specify by written notice to the Borrower and the Collateral
Agent.
"Eurodollar Rate" means, with respect to any Eurodollar
Inter-est 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 Rate 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 a
Eurodollar Rate and the Eurodollar Rate Margin as provided in
Section 5.01(a).
"Eurodollar Rate Margin" means, as of any date of
determination, a per annum rate equal to the rate set forth below
opposite the then attained compliance with a Consolidated
Indebtedness to EBITDA Ratio, for the then most recently ended
four (4) Fiscal Quarter period, by the Borrower and its
Subsidiaries, on a consolidated basis, measured as of the end of
each Fiscal Quarter commencing with the Fiscal Quarter ending
December 27, 1999:
Consolidated Revolver
Indebtedness to Eurodollar
EBITDA Ratio Rate Margin
Less than 3.50 to 1.00 1.75%
Less than 4.25 to 1.00 and equal 2.25%
to or greater than 3.50 to 1.00
Less than 5.00 to 1.00 and equal 2.50%
to or greater than 4.25 to 1.00
Less than 5.75 to 1.00 and equal 2.75%
to or greater than 5.00 to 1.00
Equal to or greater than 5.75 to 3.25%
1.00
Consolidated Term
Indebtedness to Eurodollar
EBITDA Ratio Rate Margin
Less than 4.25 to 1.00 2.75%
Less than 5.00 to 1.00 and equal 3.00%
to or greater than 4.25 to 1.00
Equal to or greater than 5.00 to 3.25%
1.00
provided, however, that, notwithstanding the foregoing, the
Revolver Eurodollar Rate Margin during the period commencing on
the Closing Date and ending on March 31, 2000 shall be equal to
three percent (3.00%) per annum and the Term Eurodollar Rate
Margin during the period commencing on the Closing Date and
ending on March 31, 2000 shall be equal to three and one-quarter
percent (3.25%) per annum.
"Eurodollar Rate Reserve Percentage" means, for any
Lender for the Eurodollar Interest Period for any Eurodollar
Rate, the reserve percentage which is applicable three (3)
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
"Eurodollar Liabili-ties" (or with respect to any other category
of liabilities which includes deposits by reference to which the
inter-est 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.
"Excess Cash Flow" means, without duplication, for each
Fiscal Year of the Borrower ending after June 30, 1999, an amount
equal to the greater of (i) zero or (ii) the amount equal to:
(a) EBITDA for such Fiscal Year, minus
(b) the amount of taxes actually paid by the Borrower and
the Restricted Subsidiaries in cash during such Fiscal Year,
minus
(c) Cash Interest Expense (including bank fees, commissions,
discounts and other fees and charges with respect to letters of
credit, commitment fees, and fees paid under any fee letter and
payments made for retiree medical benefit obligations) for such
Fiscal Year, plus
(d) the net reduction, if any, in working capital (excluding
changes in cash and cash equivalents) of the Borrower and
Restricted Subsidiaries during such Fiscal Year, minus
(e) the net increase, if any, in working capital (excluding
changes in cash and cash equivalents) of the Borrower and
Restricted Subsidiaries during such Fiscal Year, minus
(f) Capital Expenditures incurred as permitted pursuant
hereto during such Fiscal Year, minus
(g) cash flow to the extent included in the amounts
determined under clauses (a) - (f) above generated by the
Farmingdale Property, any Unrestricted Subsidiary or Investments
made as permitted by Section 10.04(d), minus
(h) the amount of all permanent repayments (including,
without limitation, mandatory prepayments) of Indebtedness for
Borrowed Money (other than mandatory prepayments in respect of
Excess Cash Flow), minus
(i) the amount of all bonuses in an amount not to exceed the
amount thereof disclosed in the Projections and paid on or before
June 30, 2000 to executive officers of the Borrower and
Restricted Subsidiaries in connection with the Kaynar
Acquisition, minus
(j) the amount of severance, rationalization, product
qualification and other non-recurring transition costs incurred
in connection with the Kaynar Acquisition in an aggregate amount
not to exceed $20,000,000.
"Exchange Rate" means, in relation to the purchase of
one currency (for the purposes of this definition, the "first
currency") with another currency (for the purposes of this
definition, the "second currency") on a given date, Citibank's
spot rate of exchange for the amount in question in the London
interbank market at 11:00 a.m. (London time) on such date for the
purchase of the first currency with the second currency, for
delivery two (2) Business Days later.
"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.
"Farmingdale Property" means the Real Property located
in Farmingdale, New York identified on Schedule 1.01.1 attached
hereto and made a part hereof.
"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 trans-actions 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 Busi-ness 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 Collateral Agent from three federal
funds brokers of recog-nized standing selected by the Collateral
Agent.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System or any Governmental Authority succeed-
ing to its functions.
"Fee Letter" means that certain fee letter addressed to
the Borrower dated March 17, 1999.
"FHC" means Fairchild Holding Corp., 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 the Borrower and
the Borrower's Subsidiaries shall routinely and regularly
prepare, and (iii) such other financial statements as the
Collateral Agent or the Requisite Lenders may from time to time
reasonably specify.
"Fiscal Quarter" means each of the three-month periods
ending on the dates set forth on Schedule 1.01.2.
"Fiscal Year" means the fiscal year of the Borrower and
its Subsidiaries for accounting and federal income tax purposes,
which shall be the 12-month period ending on June 30 of each
calendar year.
"Foreign Employee Benefit Plan" means any employee bene-
fit plan as defined in Section 3(3) of ERISA which is main-tained
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, rights
under non-compete agreement, 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,
(xvi) uncertificated securities and (xvii) investment property.
"German Acquisition Loans" means loans, in the
aggregate principal amount of DM23,105,902.50 made on November
26, 1997 by Citibank Aktiengesellschaft to the German Subsidiary
Borrowers.
"German Subsidiary Borrowers" means, collectively,
Fairchild Fasteners Europe--Camloc GmbH, a Subsidiary of FHC, and
Fairchild Fasteners Europe-VSD GmbH, a Subsidiary of FHC.
"Governmental Authority" means any nation or
government, any federal, state, local or other political sub-
division thereof and any entity exercising executive, legisla-
tive, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantors" means each of the Subsidiaries of the
Borrower identified on Schedule 1.01.3 attached hereto and made a
part hereof as of the Closing Date, and any other Person
executing and delivering a guaranty of payment and performance of
all or any portion of the Obligations after the Closing Date.
"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, forward, 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
Agents, the Collateral 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 Securi-ties, debentures, acceptances, notes or
other similar instru-ments, 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 indebted-ness, obligations or liabili-ties are
assumed by such Person, all as of such time; (c) all
indebtedness, obligations or other liabil-ities of such Person in
respect of interest rate contracts, Hedge Agreements and foreign
exchange contracts, net of liabilities owed to such Person by the
counterpar-ties thereon; and (d) all preferred stock subject
(upon the occurrence of any contingency or otherwise) to
mandatory redemp-tion.
"Indebtedness for Borrowed Money" means, with respect
to any Person, to the extent the following would be reflected on
a balance sheet of such Person and its Subsidiaries prepared in
accordance with GAAP, the principal amount of all Indebtedness of
such Person in respect of borrowed money, evidenced by debt
securities, debentures, acceptances, notes or other similar
instruments, in respect of Capital Lease obligations, in respect
of Reimbursement Obligations or in respect of the deferred
purchase price of property or services, except accounts payable
and accrued expenses arising in the ordinary course of business.
"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) EBITDA for such period to (ii) Cash Interest Expense
for such period.
"Interest Margin Effective Date" means the date,
determined in accordance with the provisions of Section 5.04, on
which the Base Rate Margins and Eurodollar Rate Margins
applicable to a given period become effective.
"Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended to the date hereof and from time to time
hereafter, any succes-sor 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 capital contribution by that Person to any other Person. 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, 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, each other Lender or Affiliate of a Lender
approved by the Collateral 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.
"Kaynar" means Kaynar Technologies Inc., a Delaware
corporation.
"Kaynar Acquisition" means the merger of Dah Dah, Inc.,
a Delaware corporation and Wholly-Owned Subsidiary of the
Borrower, with and into Kaynar, with Kaynar being the surviving
corporation.
"Kaynar Credit Agreement" means that certain Third
Amended and Restated Credit Agreement dated October 23, 1998, as
amended, among Kaynar, the other credit parties thereto, the
lenders from time to time parties thereto and General Electric
Capital Corporation.
"Kaynar Non-Compete Contract" means that certain Voting
and Option Agreement dated as of December 26, 1998 among the
Borrower, General Electric Capital Corporation, Dah Dah, Inc. and
CFE, Inc. executed and delivered in accordance with the terms of
the Kaynar Purchase Agreement.
"Kaynar Purchase Agreement" means that certain
Agreement and Plan of Reorganization dated as of December 26,
1998 among the Borrower, Dah Dah, Inc., a Delaware corporation,
and Kaynar.
"Lender" means, as of the Closing Date, each financial
institution 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 to an amendment hereto or pursuant
to an Assignment and Accept-ance.
"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 Dollar equivalent of the undrawn face
amount of all outstanding Letters of Credit, plus (iii) the
aggregate Dollar equivalent of the 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
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 Collateral 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 Agree-ment, 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 (includ-ing, 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),
deed of charge, 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 financ-ing 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, depositary account and cash management agreements to which
the Borrower or any Guarantor and any Lender or any Affiliate of
a Lender is a party, and all other instruments, agreements and
written Contractual Obliga-tions between any Guarantor, the
Borrower or any Subsidiary of the Bor-rower, either
Administrative Agent, the Collateral Agent, and any of the
Lenders or Issuing Banks delivered to either Administrative
Agent, the Collateral Agent, such Lender or such Issuing Bank
pursuant to or in connec-tion with the transactions contemplated
hereby.
"Loans" means all Revolving Loans, Term Loans and Swing
Loans, whether Base Rate Loans or Eurodollar Rate Loans.
"Margin Stock" means "margin stock" as such term is
defined in Regulation U.
"Material Adverse Effect" means a material adverse
effect upon (i) the financial condition, operations, assets or
prospects of the Borrower and its Subsidiaries on a consolidated
basis, (ii) the ability of the Borrower or any of its
Subsidiaries to perform its respective obligations under the Loan
Docu-ments, or (iii) the ability of the Lenders, the Issuing
Banks, or the Collateral Agent to enforce any of the Loan
Documents.
"Material Subsidiary" means a Restricted Subsidiary of
the Borrower the assets of which have an aggregate book value
equal to or greater than $500,000.
"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 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 Restricted Subsidiary at any time on or after
the Closing Date on account of:
(i) the issuance of equity Securities other than
(a) equity Securities of a Subsidiary of the Borrower
issued to the Borrower;
(b) equity Securities of a Subsidiary of the Borrower
issued to another Subsidiary of the Borrower; and
(c) equity Securities of the Borrower issued pursuant
to Permitted Equity Securities Options, or
(ii) a contribution to its capital by any Person (other than
another "Fairchild Affiliate").
For purposes of this definition, "Fairchild Affiliate" means the
Borrower and any direct or indirect Subsidiary of the Borrower.
"Net Cash Proceeds of Issuance of Indebtedness" means
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) of Indebt-
edness for Borrowed Money (other than such Indebtedness permitted
under Section 10.01) of the Borrower or any Restricted
Subsidiary, in each case net of all transaction costs and under-
writers' discounts and similar fees with respect thereto.
"Net Cash Proceeds of Sale" means:
(i) cash proceeds (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 of property permitted under
Sections 10.02(d) and 10.09, net of (a) the costs of sale,
assignment or other disposi-tion, (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
received by (1) the Borrower or any Restricted Subsidiary other
than proceeds of sales of Permitted Dispositions (other than (a)
the Technologies Companies (upon the completion of full
liquidation of all Technologies Companies) and (b) the Banner
Companies (to the extent any mandatory prepayment of Net Cash
Proceeds of Sale of Banner Companies is made as required by
Section 4.01(b)(i)(B)), (2) the Technologies Companies upon the
completion of full liquidation of all Technologies Companies, and
(3) the Banner Companies (whether or not a Restricted Subsidiary)
to the extent any mandatory prepayment of Net Cash Proceeds of
Sale of Banner Companies is made as required by Section
4.01(b)(i)(B); 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 Cash Proceeds of Sale of Banner Companies" means
cash proceeds (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 or Capital Stock of the Banner Companies, other
than sales of property permitted under Sections 10.02(d) and
10.09, net of (a) the costs of sale, assignment or other disposi-
tion, (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.
"Net Cash Proceeds of Sale of Permitted Dispositions"
means cash proceeds (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 of property permitted under
Sections 10.02(d) and 10.09, net of (a) the costs of sale,
assignment or other disposi-tion, (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
received by the Borrower or any Restricted Subsidiary with
respect to sales of Permitted Dispositions (other than the
Technologies Companies (upon the completion of full liquidation
of all Technologies Companies) and the Banner Companies).
"Non Pro Rata Loan" is defined in Section 4.02(f).
"Note" means a promissory note in the form attached
hereto as Exhibit B 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 C attached hereto and made a part hereof.
"Notice of Conversion/Continuation" means a notice
substantially in the form of Exhibit D 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 either Administrative Agent, the Collateral Agent,
any Lender, any Issuing Bank, any Affiliate of either
Administrative Agent, the Collateral 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, 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 and all
liabilities and obligations owing by the Borrower or any
Subsidiary of the Borrower arising with respect to depositary
accounts and cash management systems maintained with any Lender
or any Affiliate of any Lender for the Borrower and/or its
Subsidiaries, under Hedge Agreements entered into between the
Borrower and/or its Subsidiaries and any Lender or any Affiliate
of any Lender, and with respect to credit cards issued by any
Lender or Affiliate of any Lender to the Borrower, any Subsidiary
of the Borrower, or any employee of such Person. The term
includes, without limita-tion, all interest, charges, expenses,
fees, attor-neys' fees and disbursements and any other sum charge-
able to the Borrower under this Agreement or any other Loan
Document, to the Borrower or any of its Subsidiaries under any
such Hedge Agreement, and to the Borrower or any of its
Subsidiaries with respect to any such depositary accounts, cash
management systems and credit cards.
"Officer's Certificate" means, as to a corporation, a
certificate executed on behalf of such corporation by the chair-
man or vice-chairman of its board of directors (if an officer of
such corporation) or its presi-dent, any of its vice presidents,
or its treasurer.
"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 Group
as more particularly described on Schedule 1.01.4 attached hereto
and made a part hereof and engaged in the business of
manufacturing and sales of aerospace and industrial fasteners,
(ii) Gas Spring Division as more particularly described on
Schedule 1.01.4, (iii) Fairchild Technologies Group as more
particularly described on Schedule 1.01.4, and (iv) Banner
Aerospace, Inc. as more particularly described on Schedule
1.01.4; and each of the foregoing is an "Operating Unit".
"Organizational Documents" means, with respect to any
corporation, limited liability company, unlimited liability
company, or partnership (i) the articles/certificate of
incorporation or articles of association (or the equivalent
organizational documents) of such corpora-tion, limited liability
company, or unlimited 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, unlimited 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, unlimited 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 Dispositions" means the sale, lease,
transfer or other disposition of the operations and/or assets
and/or Investments identified on Schedule 1.01.5 attached hereto
and made a part hereof.
"Permitted Equity Securities Options" means the
subscriptions, options, warrants, rights, convertible securities
and other agreements or commitments relating to the issuance of
equity Securities identified on Schedule 1.01.6 attached hereto
and made a part hereof.
"Permitted Existing Indebtedness" means the Indebted-
ness of the Borrower and its Subsidiaries identified on Schedule
1.01.7 attached hereto and made a part hereof.
"Permitted Existing Investments" means those Invest-
ments identified as such on Schedule 1.01.8 attached hereto and
made a part hereof.
"Permitted Existing Liens" means the Liens on assets of
the Subsidiaries of the Borrower identified on Schedule 1.01.9
attached hereto and made a part hereof.
"Permitted Holders" means (i) Jeffrey J. Steiner (ii)
any member of Jeffrey J. Steiner's immediate family or any of his
lineal descendants, (iii) any trust or estate the principal
beneficiaries of which are Persons referred to in clauses (i) and
(ii), (iv) in the event of the incompetence or death of any of
the Persons described in clauses (i) or (ii), such Person's
estate, executor, administrator, committee or other personal
representative or beneficiaries, and (v) and Affiliate or
"associate" (as defined in the Securities Exchange Act) of the
Persons described in clauses (i), (ii), (iii) and (iv).
"Person" means any natural person, corporation, limited
liability company, unlimited 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 Affil-
iate 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 consti-
tute an Event of Default.
"Pro Forma Balance Sheet" means, collectively, the
unaudited pro forma estimated opening balance sheet, as of April
20, 1999, of the Borrower and its Subsidiaries attached hereto as
Exhibit E, prepared in accordance with GAAP, dated the Closing
Date, and giving effect to the extensions of credit contemplated
hereby, the issuance of the Senior Subordinated Notes, the
payment of the Refinanced Indebtedness, the cash purchase price
under the Kaynar Purchase Agreement, and the Banner Exchange.
"Projections" means the financial projections for the
Borrower and its Subsidiaries and assumptions prepared by the
Borrower attached hereto as Exhibit F.
"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).
"Pro Rata Share" means, with respect to any Lender, the
percentage obtained by dividing (i) the sum of such Lender's
Revolving Credit Commitment (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) plus
the outstanding principal balance of such Lender's Term Loan, by
(ii) the sum of the aggregate amount of all of the Revolving
Credit Commitments plus the outstanding balance of all Term
Loans; provided, however, that, in the event the Revolving Credit
Commitments have been terminated pursuant to the terms of this
Agreement, "Pro Rata Share" shall be determined based upon the
Revolving Credit Commitments in effect immediatly prior to such
termination.
"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 apper-
taining and all extensions, additions, improvements, betterments,
renewals, substitutions and replace-ments 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 (i) all Indebtedness
outstanding pursuant to the Banner Credit Agreement, other than
contingent obligations with respect to the letters of credit
issued thereunder, (ii) all Indebtedness outstanding pursuant to
the TFC/RHI/FHC Credit Agreement, other than contingent
obligations with respect to the letters of credit issued
thereunder (which letters of credit referenced in clauses (i) and
(ii) hereof constitute Letters of Credit), (iii) all Indebtedness
outstanding pursuant to the Kaynar Credit Agreement, other than
contingent obligations with respect to letters of credit issued
thereunder in the event such letters of credit are either cash
collateralized or supported by Letters of Credit, and (iv) all
Indebtedness of BAR DE, Inc. outstanding under any margin loan.
"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 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 Dollar
equivalent of the non-contingent reimbursement or repayment
obliga-tions 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 Con-taminants 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 Con-taminants in
the indoor or outdoor environment; (ii) pre-vent 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 in an amount greater than $500,000 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 the Borrower
has delivered written notice to the Collateral Agent within 90
days after the Collateral Agent's receipt of the proceeds of such
insurance payment or condemnation award that the owner or
operator of such Property intends to so replace, rebuild or
restore such Property 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 docu-
ments of such Person, and any law, rule or regulation, or deter-
mination 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 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, environ-mental or land use requirement or Permit and
Environmental, Health or Safety Requirement of Law.
"Requisite Lenders" means Lenders whose Term Loan Pro
Rata Shares, in the aggregate, are greater than fifty-one percent
(51%) and Lenders whose Revolving Credit Pro Rata Shares, in the
aggregate, are greater than fifty one percent (51%); provided,
however, that, in the event any of the Revolving Lenders shall
have failed to fund its Revolving Credit 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", as it pertains to Revolving
Lenders, means Revolving Lenders (excluding all Revolving Lenders
whose failure to fund their respective Revolving Credit Pro Rata
Shares of such Revolving Loans have not been so cured) whose
Revolving Credit Pro Rata Shares represent more than fifty-one
percent (51%) of the aggregate Revolving Credit Pro Rata Shares
of such Revolving Lenders; provided, further, however, that, in
the event that the Revolving Credit Commitments have been
terminated pursuant to the terms of this Agreement, "Requisite
Lenders", as it pertains to Revolving Lenders, means Revolving
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 Revolving 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 Restricted
Subsidiary 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 sinking
fund or similar payment or other acquisition for value (except to
the extent permitted under Section 10.05), direct or indirect, of
any shares of any class of equity Securities of the Borrower or
any Restricted Subsidiary now or hereafter outstanding, (iii) any
payment or prepay-ment of principal of, premium, if any, or
interest, fees or other charges on or with respect to, and any
redemp-tion, purchase, retirement, defeasance, sinking fund or
similar payment and any claim for rescission with respect to, any
Indebtedness for Borrowed Money of the Borrower or any Restricted
Subsidiary other than the Obligations, the Refinanced
Indebtedness repaid as anticipated by this Agreement, scheduled
payments of principal and interest due with respect to
Indebtedness permitted under Section 10.01(c) - (i), refinancings
of Permitted Existing Indebtedness permitted under Section
10.01(h), and scheduled interest payments due with respect to the
Senior Subordinated Notes, and (iv) any payment made to redeem,
purchase, repurchase or retire, or to obtain the surrender of,
any out-stand-ing warrants, options or other rights to acquire
shares of any class of Capital Stock or other equity Securities
of the Borrower or any Restricted Subsidi-ary now or hereafter
outstand-ing (except to the extent permitted under Section
10.05).
"Restricted Subsidiaries" means any Subsidiary of the
Borrower other than an Unrestricted Subsidiary. In no event shall
any Unrestricted Subsidiary become a Restricted Subsidiary.
"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
condi-tions 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
Commit-ment" on Schedule 1.01.10 attached hereto and made a part
hereof, the signature pages of any amendment hereto, 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 $100,000,000, as reduced from time to time pursuant to Section
4.01.
"Revolving Credit Obligations" means, at any par-tic-
ular 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 Lender, the percentage obtained by dividing (i) such
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 Revolving Credit Commitments.
"Revolving Credit Termination Date" means the earliest
to occur of (i) April 30, 2005 (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 Lender" means each Lender having a Revolving
Credit Commitment.
"Revolving Loans" is defined in Section 2.01(a).
"RHI" means RHI Holdings, Inc., a Delaware corporation.
"SBIC" means a corporation formed by the Borrower as
permitted by the terms of Section 10.04(f).
"Securities" means any Capital Stock, shares, voting
trust certif-icates, partnership certificates or interests,
bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, or
in general any instruments commonly known as "investment
securities" or "securities", including, without limitation, any
"security" as such term is defined in Section 8-102 of the
Uniform Commercial Code, whether certificated or uncertificated,
or any certificates of interest, shares, or par-tici-pations in
temporary or interim certificates for the purchase or acquisi-
tion 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 Obliga-tions.
"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.
"Senior Subordinated Note Indenture" means that certain
Indenture dated as of April 20, 1999 between the Borrower and The
Bank of New York, as Trustee, with respect to $225,000,000 10
3/4% Senior Subordinated Notes due 2009.
"Senior Subordinated Notes" means the senior
subordinated notes in an aggregate face amount of $225,000,000
issued by the Borrower under and pursuant to the Senior
Subordinated Note Indenture and notes issued in exchange therefor
as contemplated by the Senior Subordinated Note Indenture and
related registration rights agreement.
"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 Guarantor or
any Subsidiary of the Borrower 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, unlimited liability company, general or
limited partnership, or other entity of which securities or other
owner-ship 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.
"Swing Lender" means either Administrative Agent.
"Swing Loan Availability" is defined in Section
2.01(c).
"Swing Loan Reserve" means, at any time, a reserve in
an amount equal to the then outstanding balance of the Swing
Loans.
"Swing Loans" is defined in Section 2.01(c).
"Swing Loan Subfacility" means, at any time, an amount
equal to the lesser of (i) $15,000,000 and (ii) the aggregate
amount of the Revolving Credit Commitments of the Administrative
Agents.
"Taxes" is defined in Section 14.01(a).
"Technologies Companies" means, collectively, (i)
Fairchild Technologies USA, Inc., a Delaware corporation; (ii)
Fairchild Germany, Inc., a Delaware corporation; (iii) Fairchild
CDI S.A.; (iv) Fairchild Technologies Optical Disc Equipment
Group GmbH until the optical disc equipment business and
operations thereof are transferred to another Technologies
Company; (v) Fairchild Technologies Semiconductor Equipment Group
GmbH; (vi) Convac France S.A.; (vii) Fairchild Technologies
Europe Limited; (viii) Fairchild Technologies Korea Limited; (ix)
Snails, Inc.; (x) MediaDisc S.A.; (xi) CuTek Research, Inc.; and
(xi) those operating Subsidiaries of the Borrower and Persons any
equity Securities of which are owned by the Borrower or any
Subsidiary of the Borrower, or which may be acquired or formed by
a Technology Company after the Closing Date, which are engaged in
the manufacture and sale of equipment used in the manufacture of
semiconductors and optical discs; and "Technologies Company"
means any of the Technologies Companies, individually.
"Term Lender" means a Lender to which the Borrower is
obligated with respect to a Term Loan.
"Term Loan" and "Term Loans" are defined in Section
2.01(b).
"Term Loan Commitment" means, with respect to any
Lender, the obligation of such Lender to make Term Loans pursuant
to the terms and conditions of this Agreement on the Closing Date
in an aggregate amount which shall not exceed the principal
amount set forth opposite such Lender's name under the heading
"Term Loan Commitment" on Schedule 1.01.10 attached hereto and
made a part hereof, and "Term Loan Commitments" means the
aggregate principal amount of the Term Loan Commitments of all
Term Lenders, the maximum amount of which shall be $225,000,000.
"Term Loan Pro Rata Share" means, with respect to any
Term Lender, the percentage obtained by dividing (i) the
outstanding principal amount of the Term Loan payable to such
Lender by (ii) the aggregate outstanding principal amount of all
Term Loans.
"Term Loan Termination Date" means the earlier of (i)
April 30, 2006 and (ii) the date of acceleration of the
Obligations pursuant to Section 12.02.
"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 such Borrower or such ERISA Affiliate was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA or the cessa-
tion of operations which results in the termination of employment
of 20% of Benefit Plan participants who are employees of such
Borrower or any ERISA Affiliate; (iii) the imposition of an obli-
gation 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 termi-
nate 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/RHI/FHC Credit Agreement" means that certain Third
Amended and Restated Credit Agreement dated as of December 19,
1997, as amended, among the Borrower, RHI and FHC, as borrowers,
Citicorp and NationsBank as administrative agents, Citicorp as
collateral agent, and certain financial institutions as lenders
and issuing banks thereunder.
"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.
"Unrestricted Subsidiaries" means, as of any given
time, (i) all of the Technologies Companies other than Fairchild
Technologies Optical Disc Equipment Group GmbH, (ii) any
Subsidiary of the Borrower that at the time of determination
shall be or continues to be designated an Unrestricted Subsidiary
by the Board of Directors of the Borrower as permitted by Section
8.06 and (iii) all Subsidiaries of an Unrestricted Subsidiary.
"Unrestricted Subsidiaries Net Investment Amount"
means, as of any date of determination, the amount equal to sum
of (i) the aggregate principal amount of all intercompany loans
made to, and Accommodation Obligations incurred for the benefit
of, all Unrestricted Subsidiaries during the period commencing on
the Closing Date and ending on such date of determination, plus
(ii) the aggregate amount of all capital contributions (whether
made in cash or property valued at its Fair Market Value at the
time of contribution) made, directly or indirectly, by the
Borrower to all Unrestricted Subsidiaries during the period
commencing on the Closing Date and ending on such date of
determination minus (a) the aggregate amount of all repayments in
cash of principal of such intercompany loans made and the
aforesaid Accommodation Obligations released after the Closing
Date and (b) all returns on capital paid in cash after the
Closing Date in respect of such capital contributions; provided,
however, that in the case of dividends paid by an Unrestricted
Subsidiary, the amount of such dividends shall not be included in
the aforesaid calculation if the same are included in the
determination of EBITDA as provided in the definition of such
term. For purposes of the aforesaid calculation, (1) no loans or
capital contributions to any Technologies Company or repayments
of loans or returns on capital paid in cash by any Technologies
Company shall in any event be included in such calculation and
(2) the subject Unrestricted Subsidiaries shall include all
Unrestricted Subsidiaries (other than Technologies Companies) as
of the time of determination after giving effect to the
designation specified in the notice delivered under Section 8.06.
"Voting Stock" of a Person means all classes of Capital
Stock or other interests (including partnership interests) of
such person then outstanding and normally entitled (without
regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof.
"Wholly-Owned Subsidiary" means a corporation (i) one
hundred percent (100%) of the Capital Stock or other equity
Securities of which is owned by the Person of which it is a
Subsidiary or (ii) greater than ninety-five percent (95%) of the
Capital Stock or other equity Securities of which is owned by the
Person of which it is a Subsidiary and the remainder of which
Capital Stock or other equity Securities is owned by a nominee of
such Person 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 calen-dar month during
which such period is to end), such period shall, unless otherwise
expressly required by the other provi-sions of this Agreement,
end on the last day of the calendar month.
1.03. Accounting Terms; Financial Term Definitions.??
Subject to Section 15.04, for purposes of this Agree-ment, 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.
1.05. Dollar Equivalents.?? For purposes of Dollar
designations or Dollar equivalent designations in this Agreement,
all calculations thereof shall be determined, with respect to
amounts otherwise denominated in a non-U.S. currency, based on
the amount of Dollars required to purchase such amount of non-
U.S. currency at the Exchange Rate therefor which is in effect on
the date of determination.
ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Revolving Credit, Term Loan and Swing Loan
Facilities.?? (a) Revolving Loans. Subject to the terms and
conditions set forth in this Agreement, each Revolving Lender
hereby severally and not jointly agrees to make revolving loans,
in Dollars (each individually, a "Revolving Loan" and, collec-
tively, 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 Revolving Credit Pro Rata Share of the
Availability. All Revolving Loans comprising the same Borrow-ing
under this Agreement shall be made by the Lenders simultane-ously
and proportionately to their then respective Revolving Credit 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 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 of the Availability 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 such that the Revolving Credit Obligations at no time
exceed the Revolving Credit Commitments. Each requested
Borrowing of Revolving Loans funded on any Funding Date therefor
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) Term Loans. (i) Amount of the Term Loans. Subject
to the terms and conditions set forth in this Agreement, each
Term Lender hereby severally and not jointly agrees to make Term
Loans, in Dollars (each such loan, individually, a "Term Loan"
and, collectively, the "Term Loans") to the Borrower on the
Closing Date in the aggregate principal amount equal to its
respective Term Loan Commitment, such Term Loans requested in a
given Notice of Borrowing to be made simultaneously, it being
understood that no Lender shall be responsible for any failure by
any other Lender to perform its obligation to make a Term Loan
hereunder nor shall the Term Loan Commitment of any Lender be
increased or decreased as a result of any such failure.
(ii) Repayment of Term Loans. The outstanding balance
of the Term Loans shall be repaid in nine (9) installments in the
aggregate amounts set forth below on the dates set forth below
with a final payment on April 30, 2006 unless the Term Loan
Termination Date occurs prior to any such date, in which case all
outstanding Term Loans shall be due and payable on the Term Loan
Termination Date:
Installment Due Date Aggregate Installment
April 30, 2000 $2,250,000
April 30, 2001 $2,250,000
April 30, 2002 $2,250,000
April 30, 2003 $2,250,000
April 30, 2004 $2,250,000
April 30, 2005 $2,250,000
July 31, 2005 $52,875,000
October 30, 2005 $52,875,000
January 31, 2006 $52,875,000
April 30, 2006 $52,875,000
In addition to the scheduled payments on the Term Loans, 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 such scheduled
payments on the Term Loans pursuant to the provisions of Section
4.01(a)(i) or Section 4.01(b)(vii), as applicable.
(c) Swing Loans. (i) Amount. Subject to the terms
and conditions set forth in this Agreement, a Swing Lender, in
its sole discretion, may from time to time after the Closing Date
make loans, in Dollars, to the Borrower solely for such Swing
Lender's own account (the "Swing Loans") up to an aggregate
principal amount at any one time outstanding equal to the least
of (A) fifty percent (50%) of the Swing Loan Subfacility, (B)
such Swing Lender's unfunded Revolving Credit Commitment, and (C)
the unfunded Revolving Credit Commitments as of the time such
Swing Loans are requested (such least amount being referred to as
the "Swing Loan Availability"); provided that in no event shall
the amount of Swing Loans advanced to the Borrower at any given
time exceed the amount of the Availability at such time prior to
giving effect to such Swing Loans. All Swing Loans shall be Base
Rate Loans and be payable, together with accrued interest
thereon, on such Swing Lender's demand therefor.
(ii) Making of Swing Loans. Neither Swing Lender shall
have any duty to make or to continue to make Swing Loans at any
time. In the event a Swing Lender determines to make any Swing
Loan after Borrower's request therefor, the Swing Lender shall
make the proceeds of such Swing Loan available to the Borrower at
the Collateral Agent's office in New York, New York and shall
disburse such proceeds in accordance with the Borrower's
disbursement instructions set forth in the applicable Notice of
Borrowing. Neither Swing Lender shall make any Swing Loan at any
time if such Swing Lender shall have received a written notice
from any Lender or shall otherwise have actual knowledge before
funding such Swing Loan that one or more of the conditions
precedent set forth in Section 6.02 will not be satisfied on the
proposed Funding Date for such Swing Loan, but neither Swing
Lender shall otherwise be required to take any action to
determine that the conditions precedent set forth in Section 6.02
have been satisfied prior to making any Swing Loan.
(iii) Repayment of Swing Loans. (A) From time to time
when Swing Loans are outstanding, the Swing Lenders shall, at
their discretion, notify the Collateral Agent of their request
for repayment thereof, whereupon the Collateral Agent shall
notify the Revolving Lenders of such request as set forth below.
On the proposed purchase date set forth in such notice, and on
the Revolving Credit Termination Date, each Revolving Lender
shall irrevocably and unconditionally purchase from such Swing
Lender(s), without recourse or warranty, an undivided interest
and participation in such Swing Loan to the extent of such
Revolving Lender's Revolving Credit Pro Rata Share thereof. The
aforesaid request by the Swing Lender shall be made by written
notice to the Collateral Agent (which may be delivered by
facsimile transmission) or telephone to the Collateral Agent
(with written confirmation thereof by facsimile transmission),
which notice shall specify a proposed purchase date and be
delivered to the Collateral Agent no later than 12:00 noon at
least one (1) Business Day in advance of such proposed purchase
date. Promptly after receipt of such notice, the Collateral Agent
shall notify the Revolving Lenders of the requested purchase and
each Revolving Lender shall deposit an amount equal to its
Revolving Credit Pro Rata Share of the applicable Swing Loan with
the Collateral Agent at its office in New York, New York, in
immediately available funds not later than 1:00 p.m. (New York
time) on the proposed purchase date. The Collateral Agent shall
thereupon (regardless of whether the conditions precedent set
forth in Section 6.02 are then satisfied) remit such amount to
the Swing Lender(s) in immediately available funds. If such
amount is not made available by any Revolving Lender to the
Collateral Agent for remittance to the Swing Lender(s) as
described above, the Swing Lender shall be entitled to recover
such amount on demand from such Revolving Lender, together with
accrued interest thereon, for each day from the date of demand,
at the Federal Funds Rate for the first three (3) days following
the date such amount was due and thereafter at the Base Rate. The
failure of any Revolving Lender to pay such amount to the Swing
Lender(s) shall not relieve any other Revolving Lender of its
obligation to make the payment to be made by it. Upon the
purchase of a Revolving Lender of a participation in any Swing
Loan pursuant to this Section 2.01(c)(iii), such Revolving Lender
shall be deemed to have made a Revolving Loan in the amount of
such participation, and such Swing Loan shall be deemed to have
been repaid in such amount.
(B) Notwithstanding anything to the contrary in this
Section 2.01(c), Borrower shall, whether or not a Swing Lender
shall have made demand therefor, on the Revolving Credit
Termination Date repay in full the principal amount of the Swing
Loans then outstanding together with interest thereon.
2.02. General Terms.?? (a) Notice of Borrowing.
When the Borrower desires to borrow under Section 2.01, the
Borrower shall deliver to the Collateral Agent a Notice of
Borrowing, signed on behalf of the Borrower, (i) on the Closing
Date, in the case of a Borrowing on the Closing Date, (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 11:00 a.m. (New
York time) at least three (3) 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 and whether the Borrowing is of Term Loans or Revolving
Loans, (iii) in the case of Revolving Loans, the 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, and (vi) the instructions for the
disbursement of the proceeds of the proposed Borrowing. The Loans
made on the Closing Date shall initially be Base Rate Loans and
there-after 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 Loans on the Closing Date), the
Borrower may give the Collateral Agent telephonic notice of any
proposed Bor-rowing by the time required under this Section
2.02(a), if the Borrower confirms such notice by delivery of the
required Notice of Borrowing to the Collateral 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 Collateral Agent within fourteen (14)
days after the date of such transmission. Any Notice of
Borrowing (or telephonic notice in lieu thereof) given pursuant
to this Section 2.02(a) shall be irrevocable. Notwithstanding
the foregoing, in the event a Notice of Borrowing is delivered to
the Collateral Agent after 11:00 a.m. (New York time) but by 3:00
p.m. (New York time) on any specified Funding Date, Citicorp, as
a Swing Lender, shall have the first option to make a Swing Loan
to fund the requested Borrowing, subject to the limitations set
forth in Section 2.01(c)(i), and, in the event Citicorp elects
not to make such Swing Loan or Citicorp has Swing Loans
aggregating the maximum available from it pursuant to Section
2.01(c)(i) outstanding on the Funding Date for the requested
Borrowing, NationsBank shall have the option to make such Swing
Loan.
(b) Making of Term Loans and Revolving Loans. (i)
Promptly after receipt of a Notice of Borrowing under Section
2.02(a) (or telephonic notice in lieu thereof), the Collateral
Agent shall notify each applicable Lender, by telecopy, or other
similar form of trans-mission, of the proposed Borrowing. Each
Lender obligated to make a Loan with respect to the requested
Borrowing shall deposit an amount equal to its Term Loan Pro Rata
Share or Revolving Credit Pro Rata Share, as applicable, of the
respective Term Loan or Revolving Loan amount requested with the
Collateral Agent at its office in New York, New York, in
immediately available funds not later than 2:00 p.m. (New York
time) on the applicable Funding Date therefor. Subject to the
fulfillment of the conditions precedent set forth in Section 6.01
or Section 6.02, as applicable, the Collateral Agent shall make
the proceeds of such amounts received by it with respect to Loans
available to the Borrower at the Collateral 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 disburse-ment instructions set
forth in the applicable Notice of Borrow-ing. The failure of any
Lender to deposit the amount described above with the Collateral
Agent on the applicable Funding Date shall not relieve any other
Lender of its obligations hereunder to make its 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 Collateral Agent
shall promptly return, by wire transfer of immediately available
funds, the amount deposited by each Lender to such Lender.
(ii) Unless the Collateral Agent shall have been
notified by any Lender (A) on the Business Day immediately
preceding the applicable Funding Date in respect of any Borrowing
of Loans which are Eurodollar Rate Loans or (B) prior to the time
of funding thereof as specified in Section 2.02(a) in respect of
any Borrowing of Loans which are Base Rate Loans, that such
Lender does not intend to fund its Loan requested to be made on
such Funding Date, the Collateral Agent may assume that such
Lender has funded its Loan and is depositing the proceeds thereof
with the Collateral Agent on the Funding Date therefor, and the
Collateral Agent, in its sole discretion may, but shall not be
obli-gated to, disburse a corresponding amount to the Borrower on
the applicable Funding Date. If the Loan pro-ceeds corresponding
to that amount are advanced to the Borrower by the Collateral
Agent but are not in fact deposited with the Collateral Agent by
such Lender on or prior to the applicable Funding Date, such
Lender agrees to pay, and in addition the Borrower agrees to
repay, to the Collateral 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 Collateral Agent (A) in the case of the Borrower, at the
interest rate applicable to such Borrowing and (B) in the case of
such Lender, at the Federal Funds Rate for the first Business Day
after the applicable Funding Date, and thereafter at the interest
rate applicable to such Borrowing. If such Lender shall pay to
the Collateral Agent the corresponding amount, the amount so paid
shall constitute such Lender's Loan, and if both such Lender and
the Borrower shall pay and repay such corresponding amount, the
Collateral Agent shall promptly pay to the Borrower such
corresponding amount. This Section 2.02(b) does not relieve any
Lender of its obligation to make its Loan on any applicable
Funding Date.
(c) Revolv-ing Credit Termination Date. The Revolving
Credit Commitments shall terminate on the Revolving Credit
Termination Date and each Revolving Lender's obliga-tion to make
Revolving Loans shall terminate on the Business Day next
preceding the Revolving Credit Termination Date. All outstanding
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 as provided in Section 3.01(a)(iv)) (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) April 30, 2005 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.
2.03. Authorized Officers and Collateral Agent.??
On?? the Closing Date the Borrower shall deliver, and from time
to time thereafter the Borrower may deliver, to the Collateral
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/con-tinu-a-tion of
any Loan, in each instance containing a specimen signature of
each such officer, employee or agent. The officers, employees
and agents so authorized shall also be author-ized to act for the
Borrower in respect of all other matters relating to the Loan
Documents. The Administrative Agents, Collateral 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 conver-sion/continuation until the
Administrative Agents, Collateral Agent, Lenders and Issuing
Banks receive written notice to the contrary. None of either
Administrative Agent, the Collateral Agent, the Lenders, or the
Issuing Banks shall have any duty to verify the authenticity of
the signa-ture 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/con-tinuation,
the Collateral 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 either
Administrative Agent, the Collateral Agent, the Lenders or
Issuing Banks shall incur any liability to the Borrower or any
other Person in acting upon any telephonic or facsimile notice
referred to above which such Administrative Agent, the Collateral
Agent, such Lender, or such Issuing Bank believes to have been
given by a duly author-ized officer or other person authorized to
borrow on behalf of the Borrower.
2.04. Use of Proceeds of Loans.?? The proceeds of the
Revolving Loans and Term 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 not prohibited by the terms of this Agreement,
including, without limitation, repayment in full on the Closing
Date of the Refinanced Indebtedness as reflected on Exhibit G
attached hereto and made a part hereof and payment of the cash
purchase price owing under the Kaynar Purchase Agreement, but
excluding, in accordance with the provisions of Section 10.10,
the purchasing or carrying of Margin Stock within the meaning of
Regulation U. The proceeds of the Swing Loans may be used solely
for working capital in the ordinary course of business of the
Borrower and the Borrower's Subsidiaries.
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 Guarantor or 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 Collateral 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 $40,000,000 or (II) the Availability at such
time would be less than zero, 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 Collateral Agent (and
an Issuing Bank shall not otherwise be required to
deter-mine that, or take notice whether, the conditions
precedent set forth in Sections 6.01 or 6.02, as
applicable, have been satis-fied);
(iii) which is in a currency other than a
currency in which such Issuing Bank is then issuing
letters of credit; or
(iv) which has an expiration date later than the
earlier to occur of (A) the date one (1) year after the date
of issuance (without regard to any automatic renewal
provisions thereof) and (B) the Revolving Credit Termination
Date; provided, however, that on the Revolving Credit
Termination Date, Borrower shall deposit with the Collateral
Agent (or respective Issuing Bank(s) at the direction of the
Collateral Agent) Cash Collateral for deposit in the Cash
Collateral Account or under other agreements satisfactory to
the Collateral Agent and Issuing Bank(s) and in an amount
equal to one hundred five percent (105%) of the then undrawn
face amount of all Letters of Credit denominated in Dollars
and one hundred twenty percent (120%) of the then undrawn
face amount of all Letters of Credit denominated in any
currency other than Dollars, in each instance for 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 a Guarantor or any of the Borrower's
Subsidiaries, the Borrower and such Guarantor or
Subsidiary shall have executed and delivered to such
Issuing Bank and the Collateral Agent a Letter of
Credit Reimburse--ment Agreement and such other docu-
ments 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 Collateral 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 Collateral 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 Guarantor or 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 effec-tive 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 Availability at such time, and (I) the amount of the then
out-standing Letter of Credit Obliga-tions. Such Issuing Bank
shall notify the Collateral 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 Collateral Agent's request
therefor, send a copy of such notice to the Collateral Agent.
(ii) The Issuing Bank shall give (A) the Collateral
Agent written notice, or telephonic notice confirmed promptly
thereafter in writing, of the issuance, amendment, extension or
cancellation of a Letter of Credit and (B) promptly after
issuance thereof, provide the Collateral 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 the
Guarantor or 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 that are Revolving 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 Collateral 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,
the applicable Guarantor, or the Borrower's applicable Subsidiary
on account of a Reimbursement Obligation (which notice the
Collateral 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, a Guarantor, or any of the Borrower's
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 deliv-ered 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 on the Closing Date
with respect to the Letters of Credit identified on Schedule 3.02
attached hereto and made a part hereof, 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 Section 5.03(b)) 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 Guarantor 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
Collateral Agent, which shall promptly notify each Lender, and
each Revolving Lender shall promptly and unconditionally pay to
the Collateral 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 Collateral Agent shall
promptly pay to the Issuing Bank such amounts received by it, and
any other amounts received by the Collateral 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
Collateral Agent, such Lender agrees to pay to the Collateral
Agent for the account of the Issuing Bank, forthwith on demand,
such amount together with interest thereon, for the first Busi-
ness Day 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 that are Revolving Loans in accordance with
Section 5.01(a). The failure of any Lender to make available to
the Collateral Agent for the account of an Issuing Bank its
Revolving Credit Pro Rata Share of any such payment shall neither
relieve any other Lender of its obli-gation hereunder to make
available to the Collateral 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
Collateral Agent.
(iii) Whenever an Issuing Bank receives a payment on
account of a Reimbursement Obligation, including any interest
thereon, as to which the Collateral Agent has previously received
payments from any Revolving Lender for the account of such
Issuing Bank pursuant to this Section 3.01(e), such Issuing Bank
shall promptly pay to the Collateral Agent and the Collateral
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 Collateral
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 Reimburse-ment 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 Collateral 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 limita-tion, 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, any Guarantor or
Subsidiary of 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 act-
ing), the Collateral Agent, the Issuing Bank, any
Lender, or any other Person, whether in connection with
this Agreement, any Letter of Credit, the transactions
contem-plated herein or any unrelated transac-tions
(including any underly-ing trans-actions between the
account party and beneficiary named in any Letter of
Cre-dit);
(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 inaccu-rate 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 the Guarantor or
Borrower's 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, such
Guarantor or such Subsidiary of the Borrower may have at any time
against any Issuing Bank or any other Person.
(ii) In the event any payment by the Borrower, such
Guarantor, or such Subsidiary received by an Issuing Bank with
respect to a Letter of Credit and distributed by the Collateral
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 receiver-ship, 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 the Guarantor or Borrower's 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, such Guarantor'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 first (1st) Business Day following
the last day of each calendar month, provide to the Collateral
Agent, the Borrower, and, if requested by a Lender, such 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 Collateral Agent,
setting forth the aggregate Letter of Credit Obli-gations
outstanding to it at the end of each day during such month and,
to the extent not otherwise provided in accordance with the
provisions of Section 3.01(c)(ii), any informa-tion requested by
the Collateral 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 Collateral 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 reasona-ble attor-neys' fees but excluding net income
taxes) which the Collateral Agent, such Issuing Bank or such
Lender may incur or be subject to as a conse-quence, direct or
indirect, of (A) the issuance of any Letter of Credit other than
as a result of the gross negli-gence or willful misconduct of the
Issuing Bank, as determined by a court of com-petent
jurisdiction, or (B) the failure of the Issu-ing 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 Govern-
mental Authority.
(ii) As between the Borrower and any Guarantor or any
of the Borrower's Subsidi-aries for whose account a Letter of
Credit is issued on the one hand and the Collateral 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 limi-tation of the
foregoing, subject to the provisions of the Letter of Credit
Reimbursement Agreements, the Issuing Banks and the Lenders shall
not be respon-sible for: (A) the form, validity, legality, suffi-
ciency, accuracy, genuineness or legal effect of any docu-ment
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, insuf-ficient,
inaccurate, fraudulent or forged; (B) the validity, legality or
suffi-ciency of any instrument trans-fer-ring 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 bene-ficiary of a Letter of Credit to comply duly
with condi-tions required in order to draw upon such Letter of
Credit; (D) errors, omissions, interruptions or delays in
transmission or deliv-ery of any mes-sages, by mail, cable,
telegraph, telex or other-wise, whether or not they be in cipher;
(E) errors in interpretation of tech-nical 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
Lette-r 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 Collateral 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 for the account of the Borrower, a
Guarantor, or for the account of a Subsidiary of the Borrower and
the Borrower hereby acknowledges and confirms that it is, jointly
and severally in the case of letters of credit issued for the
account of a Guarantor or other Subsidiary of the Borrower,
liable for reimbursement of amounts drawn thereunder. Such
letters of credit shall be deemed to be Letters of Credit issued
pursuant to this Agreement and be sub-ject to the provisions
hereof.
3.03. Obligations Several.?? The?? obligations of
each Issuing Bank and each 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/Commitment Reductions. (i)
Prepayments. The Borrower may prepay the Revolving Loans in
whole or in part, at any time and from time to time, subject to
the right to reborrow the same in accordance with the provisions
of Section 2.01(a). The Borrower may permanently prepay the
Revolving Loans and Term Loans in whole or in minimum amounts of
$1,000,000 and integral multiples of $1,000,000 in excess of that
amount at any time upon at least three (3) Business Days' prior
written notice to the Collateral Agent from the Borrower (which
the Collateral Agent shall promptly transmit to each Lender),
which notice shall specify the date (which shall be a Business
Day) of prepayment, the aggregate principal amount of the
prepayment, and whether such permanent prepayment is of Revolving
Loans or Term Loans. When notice of prepayment is delivered as
provided herein, the principal amount of the Loans referenced
therein shall become due and payable on the prepayment date
specified in such notice. Voluntary permanent prepayments of the
Revolving Loans shall be allocated ratably to such Loans based on
the then outstanding principal balances thereof and voluntary
prepayments of the Term Loans shall be allocated ratably to the
Term Loans based on the then outstanding principal balances
thereof and each Term Lender's Term Loan Pro Rata Share thereof
and then applied pro rata to all unpaid installments due to each
Term Lender based on the respective principal balances thereof
until paid in full.
(ii) Voluntary Commitment Reductions. The Borrower,
upon at least three (3) Business Days' prior written notice to
the Collateral Agent (which the Collateral Agent shall promptly
trans-mit 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
outstanding principal amount of the Revolving Loans by the
aggregate amount required such that the Revolving Credit
Obligations, after giving effect to such payment, will equal 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. Each reduction of the Revolving Credit Commitments shall
reduce the Revolving Credit Commitment of each Revolving Lender
proportionately in accordance with its Revolving Credit Pro Rata
Share. Any notice of termination or reduction given to the
Collateral Agent under this Sec-tion 4.01(a)(ii) 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 princi-pal amount
of the Revolving Loans specified in the notice shall become due
and payable on the date specified in such notice.
(iii) 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/Commitment Reductions.
(i) Net Cash Proceeds of Sale. (A) The Borrower shall
make or cause to be made a mandatory prepayment of the
Obligations upon the Borrower's or any Subsidiary of the
Borrower's receipt of Net Cash Proceeds of Sale in an amount
equal to (1) one hundred percent (100%) of such Net Cash Pro-
ceeds of Sale so received in the event, at the time of such
receipt, the Consolidated Indebtedness to EBITDA Ratio is greater
than 4.00 to 1.00, (2) seventy-five percent (75%) of such Net
Cash Proceeds of Sale so received in the event, at the time of
such receipt, the Consolidated Indebtedness to EBITDA Ratio is
greater than 3.00 to 1.00, but less than or equal to 4.00 to
1.00, and (3) fifty percent (50%) of such Net Cash Proceeds of
Sale so received in the event, at the time of such receipt, the
Consolidated Indebtedness to EBITDA Ratio is less than or equal
to 3.00 to 1.00.
(B) The Borrower shall make or cause to be made a
mandatory prepayment of the Obligations upon the Borrower's or
any Subsidiary of the Borrower's receipt of Net Cash Proceeds of
Sale of Permitted Dispositions and Net Cash Proceeds of Sale of
Banner Companies in an amount equal to (1) one hundred percent
(100%) of the first $25,000,000 of Net Cash Proceeds of Sale of
Permitted Dispositions and Net Cash Proceeds of Sale of Banner
Companies received and (2) fifty percent (50%) of the next
$50,000,000 of Net Cash Proceeds of Sale of Permitted
Dispositions and Net Cash Proceeds of Sale of Banner Companies.
(C) Notwithstanding the foregoing, with respect to Net
Cash Proceeds of Sale received in connection with the sale,
transfer or other disposition of the Capital Stock or assets of
Banner, upon the written request of the Borrower to the
Collateral Agent that the mandatory prepayment otherwise required
under this Section 4.01(b)(i) be waived, an amount equal to such
Net Cash Proceeds of Sale so received shall be remitted to the
Collateral Agent for deposit in the Cash Collateral Account and
the Collateral Agent shall hold the same in such Cash Collateral
Account (absent the occurrence of any Event of Default) until the
earlier to occur of (Y) the date which is 225 days after the
Borrower's or any of its Subsidiaries' receipt of such Net Cash
Proceeds of Sale or (Z) the date on which the Requisite Lenders
shall have authorized the release of the amount so deposited (or
a portion thereof) to the Borrower. In the event the amount so
deposited to the Cash Collateral Account has not been released to
the Borrower as referenced in clause (Z) above, the Collateral
Agent shall withdraw such amount from the Cash Collateral Account
on the date specified in clause (Y) above and apply the same as
set forth in Section 4.01(b)(vii).
(D) In the event at any time a mandatory prepayment of
the Obligations is not otherwise required under this clause (i)
but the Borrower or a Restricted Subsidiary has made an "Asset
Disposition" (as such term is defined in the Senior Subordinated
Note Indenture) which would give rise to an obligation to
repurchase or repay Indebtedness in respect of the Senior
Subordinated Notes but for an election on the part of the
Borrower to use the proceeds of such "Asset Disposition" to repay
the Obligations, the Borrower shall make or cause to be made a
mandatory prepayment of the Obligations in an amount equal to
100% of the Net Cash Proceeds of Sale, Net Cash Proceeds of Sale
of Banner Companies and Net Cash Proceeds of Sale of Permitted
Dispositions, as applicable, notwithstanding the limitations
otherwise set forth herein.
(ii) Net Cash Proceeds of Issuance of Equity
Securities. Unless, at the time of such receipt, the
Consolidated Senior Indebtedness to EBITDA Ratio is less than
2.00 to 1.00, immediately upon the Borrower's or any Subsidiary
of the Borrower's 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 fifty percent (50%) of
such Net Cash Proceeds of Issuance of Equity Securities. In the
event at any time a mandatory prepayment of the Obligations is
not otherwise required under this clause (ii) but an obligation
to repurchase or repay Indebtedness in respect of the Senior
Subordinated Notes would arise but for an election on the part of
the Borrower to use Net Cash Proceeds of Issuance of Equity
Securities to repay the Obligations, the Borrower shall make or
cause to be made a mandatory prepayment of the Obligations in an
amount equal to 100% of such Net Cash Proceeds of Equity
Securities, notwithstanding the limitations otherwise set forth
herein.
(iii) Net Cash Proceeds of Issuance of Indebtedness.
Immediately upon the Borrower's or any Subsidiary of the
Borrower's 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) Excess Cash Flow. As soon as practicable, and in
any event within one hundred ten (110) days after the end of each
Fiscal Year of the Borrower, commencing with such Fiscal Year
ending in 2000, the Borrower shall calculate the Excess Cash Flow
for the Fiscal Year of the Borrower most recently ended and,
unless the Consolidated Indebtedness to EBITDA Ratio for such
Fiscal Year is less than 3.00 to 1.00, the Borrower shall make a
mandatory prepayment of the Obligations in an amount equal to
fifty percent (50%) of the Excess Cash Flow for such Fiscal Year.
(v) 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) through (iv) above
which is not expressly permitted by Article X.
(vi) Notice. The Borrower shall give the Collateral
Agent prior written notice or telephonic notice promptly
confirmed in writing (each of which the Collateral 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)).
(vii) Application of Designated Prepayments.
Designated Prepayments shall be allocated and applied to the
Obligations as follows:
(A) the amount of such Designated Prepayment
shall be applied, pro rata, to the outstanding
principal balances of the Term Loans based on the
respective Term Loan Pro Rata Shares of the Term
Lenders, in each case pro rata to the unpaid
installments due under each Term Loan during the period
July 31, 2005 through April 30, 2006, based on the
respective amounts of such installments, with each
application being made to Base Rate Loans and
Eurodollar Rate Loans as provided in Section 4.02(b);
and
(B) following the payment in full of the Term
Loans or in the event there are no Term Loans
outstanding as of the date a Designated Prepayment is
required to be made, the remaining balance of (or
entire amount of, in the event there are no Term Loans
outstanding as of such required payment date) each
Designated Prepayment shall be applied to the
outstanding balances of the Revolving Loans, pro rata
based on the respective Revolving Credit Pro Rata
Shares of the Revolving Lenders, with each application
being made to Base Rate Loans and Eurodollar Rate Loans
as provided in Section 4.02(b), until paid in full.
(c) Mandatory Reductions in Revolving Credit
Commitments. The Revolving Credit Commitments shall be
permanently reduced by the amount of any Designated Prepayment
required to be applied to Revolving Loans pursuant to Section
4.01(b)(vii).
4.02. Payments.?? (a) Manner and Time of Payment.
All payments of principal of and interest on the Loans and
Reimburse-ment Obligations and other Obligations (including,
without limitation, fees and expenses) which are payable to the
Collateral 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 a Concentration Account, in immediately available funds,
delivered to the Collateral 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 Collateral Agent (or such
Issuing Bank) as it may desig-nate; in each instance, for the
account of the Collateral Agent, the Lenders or such Issuing
Bank, as the case may be. Funds received by the Collateral Agent,
including, without limitation, funds in respect of any 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 Collateral Agent after
that time shall be deemed to have been paid on the next
succeeding Business Day. Payments actually received by the
Collateral Agent for the account of the Lenders or the Issu-ing
Banks, or any of them, shall be paid to them by the Collateral
Agent promptly after receipt thereof.
(b) Pre-Default Apportionment of Payments. Subject to
the provisions of Section 4.01 and Sec-tion 4.02(f), all payments
of principal and interest in respect of outstanding Loans, all
payments in respect of Reim-bursement Obliga-tions, all payments
of fees and all other pay-ments in respect of any other
Obligations, shall be allocated among such of the Lenders and
Issuing Banks as are entitled thereto, and, if Lenders, in
proportion to their respective Revolving Credit Pro Rata Shares
or 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 Collateral Agent
from or for the benefit of the Borrower shall be applied
(i) first, to pay principal of and interest on any
portion of the Loans which the Collateral Agent may have advanced
on behalf of any Lender (other than Citicorp if the Collateral
Agent is Citicorp) for which the Collateral Agent has not then
been reimbursed by such Lender or the Borrower,
(ii) second, to pay principal of and interest on any
Protective Advance for which the Collateral Agent has not then
been paid by the Borrower or reimbursed by the Lenders,
(iii) third, to pay the principal of the 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 such Loans,
(iv) fourth, to pay all other Obligations then due and
payable, ratably, and
(v) fifth, as the Borrower designates.
All such principal and interest payments in respect of Loans
shall be applied first, to repay outstanding Base Rate Loans,
with those Base Rate Loans which are Swing Loans being repaid
first, 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 Collateral Agent shall apply all payments in
respect of any Obligations and all proceeds of Collateral in the
following order:
(i) first, to pay principal of and interest on any
portion of the Loans which the Collateral Agent may have advanced
on behalf of any Lender (other than Citicorp if the Collateral
Agent is Citicorp) for which the Collateral Agent has not then
been reimbursed by such Lender or the Borrower;
(ii) second, to pay principal of and interest on any
Protective Advance for which the Collateral Agent has not then
been paid by the Borrower or reimbursed by the Lenders;
(iii) third, to pay Obligations in respect of any fees,
expense reimbursements or indemnities then due to the Collateral
Agent;
(iv) fourth, to pay Obligations in respect of any fees,
expense reimbursements or indemnities then due to the Lenders and
the Issuing Banks;
(v) fifth, 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;
(vi) sixth, to the ratable payment or prepayment of
principal outstanding on all Loans (with Swing Loans being repaid
first), the "credit exposure" of the Lenders and any Affiliate of
any Lender which is a counterparty to Hedge Agreements,
depositary accounts or cash management agreements which
constitute Loan Documents, and principal of and interest on
Letter of Credit Obligations (or, to the extent Letter of Credit
Obligations are contingent, deposited in the Cash Collateral
Account to provide Cash Collateral in respect of such
Obligations), in accordance with the Lender's respective
Revolving Credit Pro Rata Shares and Term Loan Pro Rata Shares,
as applicable; and
(vii) seventh, to the ratable payment of all other
Obligations.
For purposes of clause (vi) above, Obligations with respect to
Hedge Agreements and depositary account and cash management
agreements as to which an Affiliate of a Lender is a party shall
be attributable to such Lender.
(d) Collateral Agent Authority to Apply Funds. The
Collateral Agent, in its sole discretion subject only to the
terms of this Section 4.02(d), may pay from the proceeds of 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 to it, which Revolving Loans shall be Base Rate Loans upon
notice from the Collateral 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 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 Collateral Agent
shall request Loans on behalf of the Borrower as described in the
preceding sentence by notifying the Lenders by telecopy, telegram
or other similar form of transmission (which notice the
Collateral 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 Loan, the Lenders shall make the
requested 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 Collateral Agent, the
Len-ders, the Issuing Banks and other Holders as among
themselves. Subject to Section 4.02(f), the Collateral Agent
shall promptly distribute to each Lender and Issuing Bank at its
primary address set forth on the appropri-ate signature page
hereof, the signature page to the Assignment and Acceptance or
amendment to this Agreement 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 Collateral 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 Revolving Credit Pro Rata Share of any
Revolving Loan or its Term Loan Pro Rata Share of any Term Loan
requested by the Borrower which such Lender is obligated to fund
under the terms of this Agreement (the funded portion of such
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 Collateral 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 Collateral
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 Revolving Credit Pro Rata Share or
Term Loan Pro Rata Share of any Loan at such time as an
amount equal to such Lender's original Revolving Credit
Pro Rata Share or Term Loan Pro Rata Share of the
requested principal portion of such 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 Revolving Credit 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 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) Prom-ise to Repay. The Borrower hereby agrees to
pay when due the principal amount of each Loan, 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
promissory notes, in form and substance acceptable to the
Collateral Agent and such Lender, evidencing the Loans made from
time to time hereunder by such Lender 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 Collateral 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
Collateral 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 Accept-ance 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 pay-able from the
Borrower to each Lender hereunder or under the Notes, and (iv)
the amount of any sum received by the Collateral 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 the Guarantors to
establish and maintain, Collection Accounts into which all
collections of Receivables shall be deposited. All amounts
deposited in Collection Accounts established by the Borrower and
the Guarantors shall be promptly transferred directly to the
Concentration Account established at Citibank in New York, New
York. The Borrower shall cause all other proceeds of Collateral
to be deposited in a Concentration Account or pursuant to other
similar arrangements for the collection of such amounts
established by the Borrower and the Collateral Agent. All
collections of Receivables and other proceeds of Collateral which
are received directly by the Borrower or any Guarantor shall be
deemed to have been received by the Borrower or such Guarantor as
the Collateral Agent's trustee and, upon the Borrower's or such
Guarantor's receipt thereof, such Borrower or such Guarantor
shall immediately transfer, or cause to be transferred, all such
amounts into a Concentration Account in their original form. All
collections of Receivables, all payments, and all proceeds of
other Collateral received by the Collateral Agent, whether
through payment, deposit in a Concentration Account as described
above, or otherwise, will be deemed received by the Collateral
Agent, will be the sole property of the Collateral Agent, and
will be held by the Collateral 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 Collateral Agent set forth
in Section 4.06.
(b) Pre-Default Withdrawals from Concentration
Accounts. If requested by the Borrower, the Collateral 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 Accounts promptly after deposit therein to payment
of the Loans and to payment of other Obligations of the Borrower
as they become due and payable, (ii) after giving effect to the
aforesaid payments, invest funds on deposit in the Concentration
Accounts 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 the
Borrower's request therefor after giving effect to the payments
described in clause (i) above, transfer funds on deposit in the
Concentration Accounts to the Borrower's or the Borrower's
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
Accounts for the benefit of the Holders as provided in Section
4.04(a). None of the Collateral 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 Accounts 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 Accounts in amounts equal to their respective
outstanding principal amounts.
(c) Reasonable Care. The Collateral Agent shall
exercise reasonable care in the custody and preservation of any
funds held in the Concentration Accounts and shall be deemed to
have exercised such care if such funds are accorded treatment
substantially equivalent to that which the Collateral Agent
accords its own like property, it being understood that the
Collateral 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 Collateral 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
Collateral Agent in the Cash Collateral Account. None of the
Collateral 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 Collateral Agent to
the Borrower or paid to whomever may be legally entitled thereto.
(c) Additional Deposits. If at any time the
Collateral 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 Collateral Agent, the Borrower
will, forthwith upon demand by the Collateral Agent, pay to the
Collateral 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 Collateral 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 Collateral Agent
accords its own like property, it being understood that the
Collateral 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.
(e) Foreign Exchange Requirements. In the event
deposits have been made to the Cash Collateral Account to secure
Letter of Credit Obligations denominated in a non-U.S. currency,
the Borrower shall enter into a Hedge Agreement for a forward
foreign exchange contract reasonably satisfactory to the
Collateral Agent to protect against fluctuation in the Exchange
Rate for the amount of such Letter of Credit Obligations until
the same are paid in full.
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 Collateral Agent's receipt of
written notice from the Requisite Lenders that no further
withdrawals may be made from the Concentration Accounts other
than for application on the Obligations for so long as the same
is continuing unwaived, neither the Borrower nor any other Person
or entity claiming on behalf of or through the Borrower shall
have any right to withdraw any of the funds held in a
Concentration Account. The Collateral 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
Collateral Agent in the Concentration Accounts 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 Collateral 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 Collateral 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 Collateral 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 Accounts 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
Collateral 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 Collateral 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 Revolver Base Rate Margin, if a
Revolving Credit Obligation, or the Term Base Rate
Margin, if a Term Loan, applicable from time to time;
and
(B) If a Eurodollar Rate Loan, at a rate per
annum equal to the sum of (1) the applicable Eurodollar
Rate deter-mined for such Eurodollar Rate Loan for the
applicable Eurodollar Interest Period, plus (2) the
Revolver Eurodollar Rate Margin, if a Revolving Credit
Obligation, or the Term Eurodollar Rate Margin, if a
Term Loan, applicable from time to time.
(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/Con-
tinuation is delivered by the Borrower to the Collateral Agent;
provided, however, the Borrower may not select a 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 Poten-
tial 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 Collateral
Agent in accordance with the terms of this Agree-ment speci-fying
the basis for deter-min-ing the rate of interest on that day,
then for that day inter-est on that Loan shall be determined by
refer-ence 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 calendar quarter, commencing with the
calendar quarter following the calendar quarter in which such
Loan was made and (B) 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 first
day of each calendar quarter, commencing with the calendar
quarter following the calendar quarter in which such Obligation
was incurred, (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 out-standing 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 succeed-ing Eurodollar Interest
Period of such continued Loans shall commence on such expiration
date; pro-vided, however, no such out-standing 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 $100,000 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 Collateral Agent no later than 11:00
a.m. (New York time) at least three (3) Business Days in advance
of the proposed conversion/continuation date. A Notice of Conver-
sion/Continua-tion shall specify (A) the proposed conversion/con-
tinua-tion date (which shall be a Business Day), (B) the
aggregate principal amount of the respective Loans to be
converted/continued, (C) whether such Loans shall be converted
and/or continued, and (D) in the case of a con-ver-sion to, or
continua-tion of, a Eurodollar Rate Loan, the requested
Eurodollar Interest Period. In lieu of delivering a Notice of
Conversion/Con-tinuation, the Borrower may give the Collateral
Agent tele-phonic notice of any proposed conversion/continuation
by the time required under this Section 5.01(c)(ii), and such
notice shall be con-firmed in writing delivered to the Collateral
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 Collateral 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
there-of), the Collateral Agent shall notify each applicable
Lender, by tele-copy or other similar form of trans-mission, of
the proposed conversion/continuation. Any Notice of Conver-
sion/Con-tinuation 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 accor-dance
therewith.
(d) Default Interest. Notwithstanding the rates of
interest specified in Section 5.01(a), effective immediately upon
the occurrence of an Event of Default (except an Event of Default
resulting from the gross negligence or willful misconduct of the
Collateral Agent) and for as long there-after as such Event of
Default shall be continu-ing unwaived, the principal balance of
all Obligations, including, to the extent permitted by applicable
law, accrued interest unpaid when due, shall bear inter-est,
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 $100,000 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 par-tic-
ular Borrowing of Eurodollar Rate Loans, a Eurodollar
Interest Period of one, two, three or six months in
duration (or such intermediate periods to which each of
the Lenders may agree in their sole discretion,
provided that, for purposes of determining the interest
rate with respect to such intermediate periods, such
periods shall be rounded up to the next nearest period
of full months);
(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 Loan if such Eurodollar
Interest Period terminates later than the scheduled
Revolving Credit Termination Date; and
(v) 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 Collateral 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 writ-ing or by telephone
confirmed in writing) to the Borrower and to each Lender. The
Collateral 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 Collateral Agent is advised by Citibank
that deposits in Dollars (in the appli-cable amounts)
are not being offered by Citibank in the London
interbank market for such Eurodollar Interest Period;
or
(ii) the Collateral 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) Lenders with respect to the applicable
Borrowing whose Revolving Credit Pro Rata Shares or
Term Loan Pro Rata Shares, as applicable, aggregate at
least fifty-one percent (51%) advise the Collateral
Agent that the Eurodollar Rate for Eurodollar Rate
Loans comprising such Borrowing will not adequately
reflect the cost to such Lenders of obtaining funds in
Dollars in the London interbank market in the amount
substan-tially equal to such Lenders' Eurodollar Rate
Loans and for a period equal to such Eurodollar
Interest Period;
then the Collateral Agent shall forthwith give notice thereof to
the Borrower, whereupon (until the Collateral Agent noti-fies 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.
(e) 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.
(f) Affiliates Not Obligated. No Eurodollar Affil-
iate 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) Collateral Agent's Fee??. The
Borrower shall pay to the Collateral Agent, solely for the
account of the Collateral Agent, during the term of this
Agreement, the fee provided in the Fee Letter as and when set
forth therein.
(b) Fronting Fee and 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 accruing at the
rate of one-quarter of one percent (0.25%) per annum on the
undrawn face amount of each outstanding Letter of Credit issued
by such Issuing Bank (the "Fronting Fee") and (ii) to the
Collateral 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
Revolving Eurodollar Rate Margin minus one-quarter of one percent
(0.25%) on the undrawn face amount of each outstanding Letter of
Credit, which Fronting Fee and Letter of Credit Fee shall be
payable quarterly, in arrears, on the first day of each calendar
quarter and on the Revolving Credit Termination Date.
(c) Commitment Fee. (i) The Borrower shall pay to the
Collateral Agent a fee (the "Commitment Fee") for the account of
the Revolving Lenders in accordance with their respective
Revolving Credit Pro Rata Shares accruing at the Commitment Fee
Rate applicable from time to time on the average daily amount
during the applicable quarter by which the Revolving Credit
Commitments exceed the sum of the Revolving Credit Obligations,
such Commitment Fee being payable to the Revolving Lenders,
quarterly, in arrears, commencing on the first day of the
calendar quarter next suc-ceeding the Closing Date and on the
Revolving Credit Termination Date.
(ii) Notwithstanding the foregoing, in the event that
any Lender fails to fund its Revolving Credit Pro Rata Share of
any Revolving Loan which such Lender is obligated to fund under
the terms of this Agreement, (A) such Lender shall not be
entitled to any Commitment Fee 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 Lenders which have funded their
respective Revolving Credit Pro Rata Shares of such requested
Revolving Loan, shall be allocated among such performing Lenders
ratably based upon their respective Revolving Credit Commitments,
and shall be calculated based upon the average amount by which
the aggregate of such Revolving Credit Commitments of such
performing Lenders exceeds the sum of (1) the Revolving Credit
Obligations owing to such performing Lenders, plus (2) the
aggregate participation interests of such performing Lenders
arising pursuant to Section 3.01(e) with respect to undrawn and
outstanding Letters of Credit.
(d) Calculation and Payment of Fees. The Commitment
Fee, Fronting Fee, and Letter of Credit Fee 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 payable under this
Agreement, to the Collateral Agent at its office in New York, New
York in imme-diately available funds. All such fees shall be
fully earned and nonre-fund-able when paid. All fees specified
or referred to in this Agreement due to the Collateral 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 in which Liens are granted by
the Borrower and Guarantors.
5.04. Determination of Applicable Base Rate Margin,
Eurodollar Rate Margin and Commitment Fee Rate.?? (a) The Base
Rate Margins and Eurodollar Rate Margins applicable from time to
time shall be determined by reference to the Borrower's
compliance with the Consolidated Indebtededness to EBITDA Ratios
as provided in the definitions of Base Rate Margin and Eurodollar
Rate Margin, respectively, as of the end of each Fiscal Quarter
commencing with the Fiscal Quarter ending on December 27, 1999
and shall apply from and after April 1, 2000 as of the Interest
Margin Effective Date immediately succeeding the end of each such
Fiscal Quarter, which shall be the date on which the Borrower
shall have delivered to the Collateral Agent at the address
designated to the Borrower from time to time in writing,
concurrently with delivery of the Financial Statements delivered
as required by Section 8.01(a), the financial and other
information necessary to establish Borrower's compliance with the
appropriate Consolidated Indebtedness to EBITDA Ratio as of such
Fiscal Quarter end.
(b) The Commitment Fee Rate applicable from time to
time shall be determined based on the actual daily outstanding
balance of the Revolving Credit Obligations during the period for
which the Commitment Fee accrues and is payable.
ARTICLE VI
CONDITIONS TO LOANS AND LETTERS OF CREDIT
6.01. Conditions Precedent to the Initial Loans and
Letters of Credit. ?? The effectiveness of this Agreement, the
obligation of each Lender on the Closing Date to make the Loan
requested to be made by it, and the agreement of each Issuing
Bank on the Closing Date to issue or continue Letters of Credit,
shall be subject to the satisfaction of all of the following
conditions precedent on or before the Closing Date:
(a) Documents. The Collateral 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 and made a part
hereof, each duly executed where appropriate and in
form and substance satisfactory to the Administrative
Agents; without limiting the foregoing, the Borrower
hereby directs its counsel, Cahill Gordon & Reindel,
its General Counsel, Donald E. Miller, its special
California counsel, Fulbright & Jaworski L.L.P., and
its special Virginia counsel, Hogan & Hartson L.L.P.,
to prepare and deliver to the Administrative Agents,
the Collateral Agent, the Lenders, the Issuing Banks
and Sidley & Austin, the opinions referred to in such
List of Closing Documents;
(ii) the Pro Forma Balance Sheet and Projections,
in form and substance satisfactory to the
Administrative Agents;
(iii) a solvency opinion relating to the Borrower
and each Guarantor rendered by Valuation Research
Corporation, dated the Closing Date, giving effect to
the financing transactions contemplated hereby and
under the Senior Subordinated Note Indenture, repayment
of the Refinanced Indebtedness, the Banner Exchange,
the Banner Distribution, and the acquisition
contemplated by the Kaynar Purchase Agreement,
supported by such analyses, valuations, appraisals,
reviews, projections and other documentation as the
Collateral Agent deems appropriate; and
(iv) such additional documentation as the
Administrative Agents may reasonably request.
(b) Perfection of Liens. Evidence to the satisfaction
of the Collateral Agent shall have been received by the
Collateral Agent that all financing statements, mortgages,
leasehold mortgages, and other required notices relating to the
Collateral located in the United States have been delivered to
the Collateral Agent for filing or have been filed or recorded,
certificates representing Capital Stock comprising part of the
Collateral have been delivered to the Collateral Agent (with duly
executed stock powers), and all recording fees and filing taxes
have been paid or provision therefor made to the satisfaction of
the Collateral Agent.
(c) Financial Statements and Performance. The amount
equal to (i) the amount of the Consolidated Total Debt as of the
Closing Date, after giving effect to the Loans and other
financial accommodations provided under this Agreement, the
issuance of the Senior Subordinated Notes, the acquisition of
Kaynar pursuant to the Kaynar Purchase Agreement, the Banner
Exchange, and repayment of the Refinanced Indebtedness, minus
(ii) cash on the balance sheet of the Borrower and its
Subsidiaries after giving effect to the Loans and other financial
accommodations provided under this Agreement, the issuance of the
Senior Subordinated Notes, the acquisition of Kaynar pursuant to
the Kaynar Purchase Agreement, and repayment of the Refinanced
Indebtedness, shall not exceed $525,000,000.
(d) No Legal Impediments. No law, regulation, order,
judgment or decree of any Governmental Authority shall, and
neither Administrative Agent shall have received any notice that
litigation is pending or threatened which is likely to, enjoin,
prohibit or restrain either the making of the Loans and/or the
issuance or continuation of Letters of Credit on the Closing
Date.
(e) No Change in Condition. No change in the
business, assets, management, operations, financial condition or
prospects of Kaynar and its Subsidiaries, taken as a whole, shall
have occurred since December 31, 1998, or of the Borrower and its
other Subsidiaries, taken as a whole, shall have occurred since
June 30, 1998, in either case which, in the judgment of the
Administrative Agents, will, or is reasonably likely to, result
in a Material Adverse Effect.
(f) Fees and Expenses Paid. There shall have been
paid to the Collateral Agent, for the accounts of the Lenders,
Issuing Banks, the Administrative Agents, and Collateral Agent,
as applicable, all fees and expenses due and payable on or before
the Closing Date under the Fee Letter, the Commitment Letter, and
other Contractual Obligations of the Borrower and its
Subsidiaries related to the transactions referenced in this
Agreement to which the Collateral Agent and Administrative Agents
are a party.
(g) Fees and Expenses Under TFC/RHI/FHC Credit
Agreement and Banner Credit Agreement Paid. All unpaid fees,
interest and expenses accrued under the terms of the TFC/RHI/FHC
Credit Agreement, Banner Credit Agreement, and other agreements
referred to therein through the Closing Date, shall have been
paid in full in immediately available funds.
(h) The Senior Subordinated Notes. The Senior
Subordinated Notes shall have been issued pursuant to, and in
accordance with, the terms of the Senior Subordinated Note
Indenture (the terms of which shall have been determined to be
satisfactory to the Administrative Agents) and the Borrower shall
have received a minimum of $275,000,000 in gross cash proceeds
from the issuance thereof, the net cash proceeds from which
issuance shall have been used to pay the cash portion of the
purchase price under the terms of the Kaynar Purchase Agreement
and/or to repay, in part, the Refinanced Indebtedness.
(i) The Kaynar Acquisition. All material consents and
approvals of Governmental Authorities and other Persons required
under Requirements of Law or Contractual Obligations of the
Borrower and its Subsidiaries or Kaynar and its Subsidiaries for
the consummation of the transactions contemplated by the Kaynar
Purchase Agreement and/or pertaining thereto and the subject
matter thereof shall have been obtained, or waived with the prior
written consent of the Administrative Agents. Kaynar shall have
merged with and into Dah Dah, Inc. pursuant to the terms of the
Kaynar Purchase Agreement and the Kaynar Non-Compete Contract
shall have become effective by its terms.
(j) Sale of AlliedSignal Inc. Capital Stock. BAR DE,
Inc., a Wholly-Owned Subsidiary of Banner, shall have sold all of
the Capital Stock of AlliedSignal Inc., a Delaware corporation,
owned by BAR DE, Inc. that is not subject to either (i) that
certain escrow established in connection with the transfer of
certain assets of Banner and certain of its Subsidiaries to
AlliedSignal Inc. and identified on Schedule 6.01-J or (ii)
reservation for delivery to officers of Banner pursuant to the
Banner Aerospace, Inc. Deferred Bonus Plan dated January 21, 1998
identified on Schedule 6.01-J, to a Person which is not an
Affiliate of the Borrower and received in payment therefor cash
in an aggregate amount of not less than $175,000,000.
6.02. Conditions Precedent to All 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 and Guarantors
con-tained in Section 7.01 and in any other Loan Document (other
than representations and warran-ties 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
Collateral 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.
(e) Notice of Borrowing. The Borrower shall have
executed and delivered to the Collateral Agent a Notice of
Borrowing in accordance with the provisions of Section 2.02.
Each submission by the Borrower to the Collateral 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 issu-ance of such Letter of Credit, shall constitute a repre-
sentation 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, each Administrative Agent, and
the Collateral Agent that the following statements are true,
correct and complete:
(a) Organization; Corporate Powers. (i) The Borrower
and each Subsidiary of the Borrower (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 jurisdic-tion in which failure to be so
qualified and in good standing will have or is reasonably likely
to have a Material Adverse Effect, and (C) 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 connec-tion with and following the
consummation of the transactions contemplated by this Agreement.
The Borrower and each Subsidiary of the Borrower 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.
(ii) True, correct and complete copies of the
Organizational Documents identified on Schedule 7.01-A attached
hereto and the Organizational Documents for each Domestic
Subsidiary formed or acquired after the Closing Date have been
delivered to the Collateral 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 Subsidiary
of the Borrower has 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 Dat-e 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 Subsidiary of the Borrower is party and the
consummation of the trans-actions contemplated thereby, have been
duly approved by the respective boards of directors (or
substantially similar governance bodies, as applicable) and, if
necessary, the shareholders of such Person and such approvals
have not been rescinded. No other corporate action or proceed-
ings on the part of the Borrower or any Subsidiary of the
Borrower is necessary to consummate such transac-tions.
(iii) Each of the Loan Documents to which the Borrower
or any Subsidiary of the Borrower 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
such Person'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 condi-tion
thereof has been amended, modified or waived from the terms and
condi-tions con-tained therein as delivered to the Collateral
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 condi-tions 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, as of the Closing Date, 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
Sub-sidiaries and the owners of such shares or interests of the
Subsidiaries of the Borrower. None of such issued and
outstanding equity Securities is subject to any vesting,
redemption, or repurchase agreement, and there are no warrants,
puts, or options (other than Permitted Equity Securities Options)
outstanding with respect to such equity Securities other than as
disclosed on Schedule 7.01-C. 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 except as specifically
identified on Schedule 7.01-C. The Borrower controls, directly or
through a Domestic Subsidiary, the voting power attendant to all
of the Capital Stock of each of the Guarantors.
(d) No Conflict. The execution, delivery and perfor-
mance of each of the Loan Documents to which the Borrower or any
Subsidiary of the Borrower is a party do not and will not (i)
conflict with the Organizational Documents of such Person, (ii)
constitute a tortious interference with any Con-tractual
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 Contrac-tual Obli-gation
of such Person, or require termination of any Contrac-tual
Obligation, the consequences of which violation, breach, default
or termina-tion, singly or in the aggregate, will, or is
reasonably likely to, result in a Material Adverse Effect or may
subject the Collateral 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 such Person, other than Liens contemplated
by the Loan Documents, or (iv) require any approval of such
Person's share-holders, which has not been obtained.
(e) Governmental Consents. The execution, delivery
and performance of each of the Loan Documents to which the
Borrower or any Subsidiary of the Borrower 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 the Collateral Agent's security interests in the
Collateral.
(f) Governmental Regulation. Neither the Borrower nor
any Subsidiary of the Borrower 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 or
other Requirement of Law which limits its ability to incur
indebted-ness or its ability to consummate the transactions
contemplated hereby or by the Loan Documents.
(g) Restricted Junior Payments. Neither the Borrower
nor any Subsidiary of the Borrower has either 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 10.05.
(h) Pro Forma Financials; Projections. The Pro Forma
Balance Sheet, 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 Borrower and its Subsidiaries, on a
consolidated basis, as of the date designated therein. The
Projections, and the assumptions expressed in the Pro Forma
Balance Sheet, are reasonable based on the information avail-able
to the Borrower at the time so furnished.
(i) Indebtedness. Schedule 1.01.7 attached hereto
sets forth, as of the Closing Date, all Indebtedness for Borrowed
Money of the Borrower and the Borrower's Subsidiaries 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).
(j) Litigation; Adverse Effects. Except as set forth
in Schedule 7.01-J 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 the Borrower's Subsidiaries,
threatened against the Borrower or any Subsidiary of the
Borrower, or with respect to which the Borrower or any of its
Subsidiaries may have successor liability, or any of the
Property (i) challenging the validity or the enforceability of
any of the Loan Docu-ments, (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 Balance Sheet or,
after the Closing Date, the consolidated Financial Statements of
the Borrower and its Subsidiaries. Neither the Borrower nor any
Subsidiary of the Borrower is (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.
(k) No Material Adverse Effect. Since June 30, 1998,
there has occurred no event with respect to the Borrower or any
Affiliate of the Borrower which has resulted, or is reasonably
likely to result, in a Material Adverse Effect.
(l) Tax Examinations. The IRS has examined (or is
foreclosed from examining by applicable statutes) the
consolidated federal income tax returns of the Borrower for all
tax periods prior to and including the taxable year ending June
30, 1995 and of Kaynar for all tax periods prior to and including
the taxable year ending December 31, 1995. All defi-cien-cies
which have been asserted against the Borrower or any of the
Borrower's 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, reason-ably 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 the Borrower's
consolidated Financial Statements heretofore delivered to the
Collateral Agent to the extent, if any, required by GAAP.
Neither the Borrower nor any Subsidiary of 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 or the Financial Statements
of the Borrower, as applicable.
(m) Payment of Taxes. All tax returns and reports of
the Borrower and each of the Borrower's 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 knowl-edge of any proposed tax assess-ment
against the Borrower or any Subsidiary of the Borrower (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.
(n) Performance. None of the Borrower, any Subsidiary
of the Borrower, 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 perfor-mance, 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 Subsidiary of the Borrower 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.
(o) Disclosure. The Confidential Information
Memorandum dated March 1999 provided to the Lenders and the Loan
Documents, and all certificates and other documents delivered to
the Administrative Agents and/or Collateral 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 con-tained 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 Agents, the Collateral Agent, the Issuing Banks or
the Lenders in regard to the matters disclosed under or in
connection with the Kaynar Purchase Agreement or in regard to any
matter which will, or is reason-ably likely to, result in a
Material Adverse Effect.
(p) Requirements of Law. The Borrower and each
Subsidiary of the Borrower, respectively, is in compliance with
all Requirements of Law applicable to it and its respective
businesses, in each case where the failure to so comply
individually or in the aggregate will, or is reason-ably likely
to, result in a Mate-rial Adverse Effect.
(q) Environmental Matters. (i) Except as disclosed on
Schedule 7.01-Q attached hereto:
(A) neither the Borrower nor any Domestic Subsidiary
(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, neither it nor
any Domestic Subsidiary (or any of their respective predecessors
in interest), or any of 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 the
Borrower reasonably believes will result in a material
expenditure of money;
(C) none of the Borrower, any Domestic Subsidiary, 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 the 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 Domestic Subsidiary 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 Domestic Subsidiary 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 the
Domestic Subsidiaries in the aggregate in excess of the reserves
established therefor and disclosed in the Borrower's Financial
Statements.
(r) ERISA. Neither the Borrower nor any Subsidiary of
the Borrower contributes to any Benefit Plan, Multiemployer Plan
or Foreign Pension Plan. 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. Schedule B (Actuarial Information) to
the 1995 annual report (Form 5500 Series) for each Benefit Plan,
copies of which have been filed with the Internal Revenue Service
and furnished to the Collateral 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. Neither the Borrower nor
any ERISA Affiliate has incurred or is reasonably expected to
incur any withdrawal liability to any Multiemployer Plan. 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. 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 and/or any of its Subsidiaries is liable does
not exceed $10,000,000.
(s) 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 Sub-sidiary of the Borrower or any ERISA Affiliate
with respect to any Foreign Employee Benefit Plan.
(t) Labor Matters. Schedule 7.01-T accurately sets
forth all labor contracts, other than national union agreements
to which any Subsidiary of the Borrower domiciled in Europe is a
party, to which the Borrower or any Subsidiary of the Borrower 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 Subsidiary of the Borrower is a party.
(u) Securities Activities. Neither the Borrower nor
any Subsidiary of the Borrower is engaged in the business of
extending credit for the purpose of purchasing or carrying Margin
Stock.
(v) Solvency. After giving effect to the Banner
Distribution, the Loans to be made and Letters of Credit to be
issued or continued on the Closing Date or such other date as
Loans requested hereunder are made or Letters of Credit requested
hereunder are issued, the guarantees of the Obligations executed
and delivered by the Guarantors, the disbursement of the proceeds
of such Loans pursuant to the Borrower's instructions, the
repayment of the Refinanced Indebtedness, the issuance of the
Senior Subordinated Notes and guarantees thereof executed and
delivered by the Guarantors, and the acquisition of Kaynar
pursuant to the Kaynar Purchase Agreement, the Borrower and each
Guarantor is Solvent.
(w) Patents, Trademarks, Permits, Etc.; Government
Approvals. (i) The Borrower and each Subsidiary of the
Borrower, as applicable, owns, is licensed or otherwise has the
lawful right to use, or has all Permits and other governmental
approvals, patents, trade-marks, trade names, copyrights, tech-
nol-ogy, know-how, permits and pro-cesses 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-W attached hereto, no claims are
pending or, to the best of the Borrower's knowledge following
diligent inquiry, threatened that the Borrower or any Subsidiary
of the Borrower is infringing or otherwise adversely affecting
the rights of any Person with respect to such Permits and other
governmental approvals, patents, trademarks, trade names, copy-
rights, tech-nology, know-how, permits and processes, except for
such claims and infringements as do not, in the aggre-gate, give
rise to any liability on the part of the Borrower or any
Subsidiary of the Borrower which will, or is reasonably likely
to, result in a Material Adverse Effect.
(ii) The consummation of the transac-tions
contemplated by the Loan Documents will not impair the owner-ship
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, tech-nology, know-how,
permits or processes by the Borrower or any Sub-sidiary of the
Borrower in any manner which will, or is reasonably likely to,
result in a Material Adverse Effect.
(x) Assets and Properties. The Borrower and each
Subsidiary of the Borrower 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. Substan-tially all of the assets and Property
owned by, leased to, or used by the Borrower and/or each
Subsidiary of the Borrower in their respective businesses 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 opera-tions, 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 Docu-ment, nor any transaction contem-plated 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.
(y) Insurance. Schedule 7.01-Y attached hereto or as
amended from time to time accurately sets forth as of the date of
such Schedule all insurance policies and programs in effect with
respect to the respective Property and assets and business of the
Borrower and the Borrower's 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. The
Borrower has delivered to the Collateral Agent copies of all such
insurance policies requested by the Collateral Agent. 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 the Borrower's
Subsidiaries.
(z) 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.
For purposes of the representations and warranties made under
this Agreement and the other Loan Documents on the Closing Date,
each of Banner and Kaynar, and their respective Subsidiaries,
shall be deemed to constitute a Subsidiary of the Borrower.
ARTICLE VIII
REPORTING COVENANTS
??
The Borrower covenants and agrees that so long as any
Revolving Credit 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.?? The Borrower shall, and shall 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 Finan-cial Statements in
conformity with GAAP and each of the Finan-cial Statements
described below shall be prepared from such system and records.
(a) Quarterly Financial Reports. (i) The Borrower
shall deliver or cause to be delivered to the Collateral Agent
and the Lenders (A) consolidated balance sheets for the Fiscal
Quarter then ended, income statements and cash flow statements of
the Borrower and its Subsidiaries on a quarterly and Fiscal Year
to date basis, (B) consolidating balance sheets by Operating Unit
and/or Unrestricted Subsidiaries as of the Fiscal Quarter then
ended and income statements by Operating Unit on a quarterly and
Fiscal Year to date basis (in the forms attached hereto as
Exhibit I), (C) schedules of the Consolidated Total Debt and
Investments of the Borrower and its Subsidiaries in Cash
Equivalents and Eligible Marketable Securities as of the end of
the applicable Fiscal Quarter then ending, and (D) a summary of
the Investments described in Section 10.04(d) made through the
Fiscal Quarter then ended; in each event as soon as practicable,
and in any event within fifty-five (55) days after the end of
each Fiscal Quarter in each Fiscal Year for the Fiscal Quarter
then ending, such Financial Statements for any fourth Fiscal
Quarter of a Fiscal Year being unaudited preliminary Financial
Statements subject to adjustment in connection with the
preparation of audited Financial Statements for such Fiscal Year.
(ii) The Financial Statements described in clause (i)
above shall set forth, in comparative form, (A) the figures for
the like period in the previous Fiscal Year and (B) the figures
for the period for which the report is submitted set forth (1) in
the Projections prior to delivery of an updated business plan as
described in Section 8.01(d), or (2) in the most recently dated
business plan delivered as described in Section 8.01(d), in each
instance, all in reasonable detail.
(b) Annual Financial Statements. (i) The Borrower
shall deliver or cause to be delivered to the Collateral Agent
and the Lenders for each Fiscal Year (A) consolidated balance
sheets of the Borrower and its Subsidiaries as at the end of such
Fiscal Year, (B) the related consolidated statements of income
and cash flow for such Fiscal Year, and (C) consolidating balance
sheets by Operating Unit and statements of income by Operating
Unit for such Fiscal Year, as soon as practicable and in any
event within one hundred (100) days after the end of each Fiscal
Year. The consolidated Financial Statements of the Borrower and
its Subsidiaries shall be accompanied by a report thereon of
Arthur Andersen LLP or other independent certified public
accountants of recognized national standing satisfactory to the
Requisite Lenders, which report shall be unqualified and shall
state that such consolidated financial statements present fairly
the financial position of the applicable Persons, as at the dates
indicated and the results of their operations and changes in
their financial position for the periods indicated in conformity
with GAAP applied on a basis consistent with prior years (or, in
the event of a change in accounting principles, such accountants'
concurrence with such change) and that the examination by such
accountants in connection with such consolidated financial
statements has been made in accordance with generally accepted
auditing standards.
(ii) The Financial Statements described in clause (i)
above shall set forth, in comparative form, (A) the figures for
the like period in the previous Fiscal Year and (B) the figures
for the period for which the report is submitted set forth (1) in
the Projections prior to delivery of an updated business plan as
described in Section 8.01(d), or (2) in the most recently dated
business plan delivered as described in Section 8.01(d), in each
instance, all in reasonable detail.
(c) Officer's Certificates. (i) An Officer's
Certificate of the Borrower substan-tially in the form of Exhibit
I attached hereto and made a part hereof shall accompany the
Financial Statements certifying that such Financial Statements
fairly present the financial position of the respective Operating
Units or Persons, as applicable, as at the dates indicated and
the results of their opera-tions for the periods indicated in
accordance with GAAP, subject to normal year end adjustments, and
stating that the officer signatory thereto has reviewed the terms
of the Loan Documents, and has made, or caused to be made under
his/her super-vision, a review in reasonable detail of the
transactions and consolidated financial condition of the
Operating Units or Persons, as applicable, during the accounting
period covered by such Financial Statements, that such review has
not dis-closed the existence during or at the end of such account-
ing period, and that such Person does not have knowledge of the
exist-ence as at the date of such Officer's Certificate, of any
condi-tion 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 its Subsidiaries has/have
taken, is/are taking and proposes/propose to take with respect
thereto.
(ii) The appropriate Financial Statements referenced
above shall also be accompanied by a certificate (the "Compliance
Certificate"), signed by the treasurer or vice president of the
Borrower, setting forth calculations for the period then ended
which demonstrate compliance with the provisions of Article XI,
including, without limitation, the amount of Capital Expenditures
made, on a cumulative basis since the beginning of the respective
Fiscal Year, and reconciliation of the same with the related
Financial Statements.
(d) Annual Business Plan. With reasonable promptness
after the Borrower's preparation thereof, the Borrower shall
deliver to the Collateral Agent and Lenders an annual business
plan.
(e) Communications with Accountants. The Borrower
authorizes (i) the Collateral Agent, after giving the Borrower
reasonable prior written notice of its intent to do so, to
communicate directly with the Borrower's independent certified
public accountants concerning the Financial Statements; provided
that the Borrower is not precluded by the Collateral Agent from
being present for such communication and (ii) such independent
certified public accountants, upon the Collateral Agent's written
request with a copy to the Borrower, to provide to the Collateral
Agent copies of any financial schedules prepared by such
accountants for the Borrower or Subsidiaries of the Borrower.
8.02. Events of Default.?? Promptly upon any of the
president, any vice president, or the 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 Collateral 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 Sec-tion
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 Collateral Agent's interest in, the
Collateral in any material respect, the Borrower shall deliver to
the Collateral 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 or Subsidiary of the Borrower has taken, is taking
and/or proposes to take with respect thereto.
8.03. Lawsuits.?? Promptly upon the Borrower's obtain-
ing knowledge of the institution of, or written threat of, any
action, suit, proceeding, governmental investigation or arbitra-
tion against or affecting the Borrower or any Subsidiary of the
Borrower or any of the Property not previously disclosed pursuant
to Section 7.01(j), which action, suit, proceeding, governmental
investigation or arbitration exposes, or in the case of multiple
actions, suits, proceedings, governmental investiga-tions or
arbitrations arising out of the same general allegations or
circumstances which expose, in the Borrower's reasonable
judgment, the Borrower and/or any Subsidiary of the Borrower to
liability in an amount aggregating $5,000,000 or more (exclusive
of claims covered by insurance policies of the Borrower and the
Borrower's Subsidiaries unless the insurers of such claims have
disclaimed coverage or reserved the right to disclaim cover-age
on such claims), the Borrower shall give written notice thereof
to the Collateral Agent and the Lenders and provide such other
information as may be reasonably available to enable each Lender
and the Collateral Agent and its counsel to evaluate such
matters. The Borrower, upon request of the Collateral 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
Collateral Agent and its counsel to evaluate such matters.
8.04. ?? Environmental Notices??. The Borrower shall
notify the Collateral Agent and the Lenders in writing, promptly
upon the Borrower's learning thereof, of any:
(a) 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 in an amount exceeding $4,000,000 to any Person
as a result of the Release or threatened Release of any
Contaminant into the environment;
(b) notice that any Property is subject to an
Environmental Lien; and
(c) 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
Collateral proceeding alleging such a material
violation by the Borrower or any Subsidiary of the
Borrower.
Concurrently with the annual delivery to the independent
accountants of the Borrower of a letter relating to financial
exposure of the Borrower and its Subsidiaries with respect to
Environmental Liabilities and Costs substantially in the form of
that letter dated August 18, 1998 addressed to Arthur Andersen
LLP, a copy of which has been delivered to the Collateral Agent
prior to the Closing Date, the Borrower shall deliver a like
letter addressed to the Collateral Agent; provided, however, that
in the event no such letter is provided to the independent
accountants of the Borrower with respect to any given Fiscal
Year, such letter shall be prepared with respect to such Fiscal
Year and delivered to the Collateral Agent on October 31 of the
calendar year in which such Fiscal Year ends.
8.05. Other Reports and Information.?? (a) Notices of
Publicly Available Information. The Borrower shall deliver or
cause to be delivered to the Collateral Agent and the Lenders
notice of publicly available Financial Statements, reports and
notices, if any, sent or made available generally by the Borrower
to its Securities holders or filed with the Commission and all
press releases made available generally by the Borrower or any
Subsidiary of the Borrower to the public concerning material
developments in the business of the Borrower or any Subsidiary of
the Borrower, in each instance, promptly upon the making of such
reports, giving of such notices or press releases, and filings
with the Commission.
(b) Copies of Information Provided Upon Request.
Promptly upon receiving a request therefor from (i) the
Collateral Agent or any Lender, the Borrower shall deliver to the
Collateral Agent or such Lender, as applicable, copies of the
notices, reports, press releases and filings referenced in any
notice delivered pursuant to Section 8.05(a) and (ii) from the
Collateral Agent or the Requisite Lenders, the Borrower shall
prepare and deliver to the Collateral Agent and the Lenders such
other reports, filings, data and information with respect to the
Borrower, any of the Borrower's 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 Collateral Agent
or the Requisite Lenders.
(c) Notifications under Securities Exchange Act. The
Borrower shall deliver to the Collateral Agent and all Lenders
copies of all notifications received by the Borrower or any
Subsidiary of the Borrower pursuant to the Securi-ties Exchange
Act and the rules promulgated thereunder, promptly upon the
receipt of such notifications.
8.06. Unrestricted Subsidiaries.?? The Borrower may
designate, by written notice to the Collateral Agent, any of its
Subsidiaries which is a Restricted Subsidiary, other than Kaynar,
Banner and any Subsidiary which is part of the Operating Unit
known as Fairchild Fasteners Group, as an Unrestricted Subsidiary
at any time and from time to time; provided that at the time of
such designation and after giving effect to the designation
specified in such notice, (a) the Unrestricted Subsidiaries Net
Investment Amount does not exceed $20,000,000 as of the date of
any such designation, (b) no Event of Default or Potential Event
of Default has occurred and is continuing unwaived, (c) on a pro
forma basis, determined for the four (4) Fiscal Quarters
immediately preceding the date of any such designation giving
effect to such designation as though it had occurred on the first
day of such four Fiscal Quarter period, no breach of any covenant
included in Article XI would have occurred as evidenced by
written confirmation of the calculation of the covenants included
in Article XI for such period delivered to the Collateral Agent
concurrent with the related notice of such designation, (d) the
sum of (i) the amount of cash held by the Borrower and the
Restricted Subsidiaries at such time after giving effect to such
designation plus (ii) the amount of Availability at such time
equals at least $25,000,000, (e) the Restricted Subsidiary the
Borrower wishes to designate as an Unrestricted Subsidiary has no
Subsidiary which is part of the Fairchild Fasteners Group
Operating Unit or an Investment in a Person which is part of the
Fairchild Fasteners Group Operating Unit and (f) the Collateral
Agent has consented to such designation.
8.07. Corporate Organization; Indebtedness for
Borrowed Money.?? The Borrower shall deliver to the Collateral
Agent (a) an updated diagram of its corporate structure in the
form of Schedule 7.01-C upon the preparation of the same and, in
any event, at least once each Fiscal Year, and (b) an updated
disclosure of outstanding Indebtedness for Borrowed Money of the
Borrower and its Restricted Subsidiaries in the form of Schedule
1.01.7 upon the preparation of the same for any purpose; in each
instance, provided that there has been any change in such
corporate structure or such outstanding Indebtedness for Borrowed
Money since the most recent date of submission of the same.
ARTICLE IX
AFFIRMATIVE COVENANTS??
The Borrower covenants and agrees that so long as any
Revolving Credit Commitment is outstanding and there-after until
payment in full of all of the Obliga-tions (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 Material Subsidiaries to, at all
times main-tain 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 Material Subsidiaries
to, qualify and remain quali-fied 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 Material Subsidiaries to, (a)
comply with all Require-ments of Law and all restric-tive
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 reason-ably 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
Material 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 (includ-ing, 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 Property or assets of the Borrower or any such
Subsidi-ary, prior to the time when any penalty or fine shall be
incurred with respect thereto; provided, however, that no such
taxes, assess-ments and governmental charges referred to in
clause (a) above or Claims referred to in clause (b) above need
be paid if being con-tested in good faith by appropriate pro-ceed-
ings 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, and will not permit any of its Material Subsidiaries
to, file or consent to the filing of any consolidated income tax
return with any Person other than 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-Y or substantially
similar policies and programs or other policies and programs as
are reasonably acceptable to the Collateral Agent. All such
policies and programs shall be maintained with responsible and
reputable insurers of companies engaged in similar businesses and
owning similar property in the same general geographic areas in
which such Person, as applicable, operates. Each certificate and
policy relating to Property damage, boiler and machinery and/or
business interruption coverage shall contain an endorsement, in
form and substance reasonably acceptable to the Collateral Agent,
showing loss payable to the Collateral Agent, for the benefit of
the Holders, and, if required by the Collateral Agent, naming the
Collateral Agent as an additional insured under such policy.
Each certificate and policy relating to coverage other than the
foregoing shall, if required by the Collateral Agent, contain an
endorsement naming the Collateral Agent as an additional insured
or mortgagee payee, as applicable, under such policy. Such
endorsement or an independent instrument furnished to the
Collateral Agent shall provide that the insurance companies will
give the Collateral 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 canceled and
that no act, whether willful or negligent, or default of the
Borrower, any Subsidiary of the Borrower or any other Person
shall affect the right of the Collateral Agent to recover under
such policy or policies of insurance in case of loss or damage.
In the event the Borrower or any of the Borrower's 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 Collateral
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 Collateral Agent
deems advisable. All sums so disbursed by the Collateral 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;
Discus-sions. ??The Borrower shall, and shall cause each of its
Material Subsid-iaries to, permit any authorized
representative(s) desig-nated by either the Collateral Agent or
any Lender to visit and inspect, whether by access to the
Borrower's and such 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 certi-fied 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 Collateral 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 their
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 Collateral Agent's request,
shall, and shall cause each of its Subsidiaries to, turn over any
such records to the Collateral 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 the Subsidiaries of the Borrower 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 of such
Persons to pay all proceeds payable under such policies or with
respect to such claim or award directly to the Collateral Agent,
for the benefit of the Collateral Agent and the other Holders. In
no case shall such proceeds be payable to the Borrower, or one or
more of the Borrower's Subsidiaries, and the Collateral Agent.
(b) Application of Proceeds. The Collateral 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)(vii). Notwithstanding the foregoing, in
the event proceeds of insurance received by the Collateral Agent
under property damage, boiler and machinery policies or business
interruption insurance policies (i) is less than $500,000 or (ii)
constitutes Replacement Proceeds, the Collateral 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 the Borrower's Subsidiaries and ERISA
Affiliates to, estab-lish, 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 interpreta-tions 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 the Borrower's
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. ??Maintenance of Property.?? The Borrower shall,
and shall cause each of its Material 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 the Borrower's or such
Subsidiaries' business.
9.11. Condemnation.?? Immediately upon learning of
the institution of any proceeding for the condemnation or other
tak-ing of any of the owned or leased Real Property of the
Borrower or any Subsidiary of the Borrower, the Borrower shall
notify the Collateral Agent of the pendency of such proceeding,
and permit the Collateral Agent to participate in any such
proceeding, and from time to time will deliver to the Collateral
Agent all instruments reasonably requested by the Collateral
Agent to permit such participation.
9.12. Subsidiaries Acquired or Formed after the Closing
Date; Guarantors. ??The Borrower shall cause each of its
Domestic Subsidiaries (and each Subsidiary which is a guarantor
of the Senior Subordinated Notes from time to time) to become a
Guarantor and the Borrower shall, and shall cause each such
Guarantor to, execute and deliver to the Collateral Agent such
Loan Documents, including, without limitation, as may be
applicable under the circumstances, guaranties, security
agreements, pledge agreements, and other agreements and
instruments related to the Capital Stock of such Subsidiaries and
Collateral owned by such Subsidiaries as the Collateral Agent
shall reasonably request concurrently with such Persons becoming
Domestic Subsidiaries and/or Guarantors. Notwithstanding the
foregoing, nothing in this Section 9.12 shall permit the Borrower
or any Subsidiary of the Borrower to form any Domestic Subsidiary
or make any Investment, directly or indirectly, not otherwise
permitted by Section 10.04.
9.13. Performance of Material Contracts. ??The
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 Collateral Agent and,
upon request of the Collateral Agent, make to each other party to
each such material Contractual Obligation such demands and
requests for information and reports or for action as such
Borrower or Subsidiary is entitled to make under such material
Contractual Obligation.
9.14. Further Assurances.?? The Borrower shall, and
shall cause each Guarantor to, execute and deliver to the
Collateral Agent, for the benefit of the Holders, such other
agreements, documents, and instruments which the Collateral Agent
deems necessary or desirable, in form and substance satisfactory
to the Collateral Agent, to enable the Collateral Agent to
perfect, or maintain perfected, Liens in the Collateral
(including, without limitation, Capital Stock acquired after the
Closing Date and held in accounts with securities
intermediaries), and all Cash Equivalents of the Borrower and the
Guarantors (other than those in Deposit Accounts not subject to
Collection Account Agreement pursuant to Section 10.14) and
marketable Securities.
9.15. Use of Proceeds of the Term Loans and the Senior
Notes. ?? The Borrower shall use the proceeds of the Term Loans
and the net cash proceeds of the Senior Subordinated Notes to pay
or provide for the payment, on the Closing Date, of the
Refinanced Indebtedness outstanding as of the Closing Date and
the cash purchase price owing under the Kaynar Purchase
Agreement.
9.16. Required Hedge Agreements.?? From and after the
Closing Date, the Borrower shall maintain in effect or enter into
Hedge Agreements on terms reasonably satisfactory to the
Administrative Agents and maintain the same in effect, for
interest rate protection with respect to the Obligations which
shall be purchased from a Lender or an Affiliate of a Lender or,
subject to the prior approval of the Requisite Lenders (which
approval shall not be unreasonably delayed or withheld), any
other Person, for such notional amount as may be required to
ensure that floating rate pricing (after giving effect to Hedge
Agreements, including, without limitation, cap agreements) shall
be effective for no more than fifty percent (50%) of Consolidated
Total Debt.
9.17. Year 2000.?? The Borrower covenants and agrees
that the computer systems and equipment of the Borrower and its
Subsidiaries containing embedded microchips (including systems
and equipment supplied by others, with which such systems
interface or on which such Persons rely) will function in a
manner on and after December 31, 1999 to ensure that their
business operations will not be interrupted to any material
extent and that the Borrower is taking and will continue to take
all necessary and appropriate action to reasonably ensure the
same.
ARTICLE X
NEGATIVE COVENANTS??
The Borrower covenants and agrees, as applicable, that,
so long as any Revolving Credit 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
other-wise 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 and the Indebtedness
evidenced by the Senior Subordinated Notes and
guarantees thereof;
(b) unsecured Indebtedness for trade payables,
wages and other accrued expenses incurred in the
ordinary course of business and recourse obligations
result-ing from endorse-ment of negotiable instruments
for collection in the ordinary course of such Persons'
business;
(c) Indebtedness arising from the following
intercompany loans:
(i) 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,
(ii) from the Borrower or any Subsidiary of the
Borrower which is a Guarantor, directly or indirectly,
to any Subsidiary of the Borrower which is not a
Guarantor the aggregate principal amount outstanding
with respect to which at any time after the Closing
Date does not exceed $10,000,000,
(iii) from the Borrower or any Subsidiary of the
Borrower to Fairchild Europe - Simmonds S.A.R.L. in the
principal amount of approximately $5,000,000 in
connection with the acquisition by Fairchild Fasteners
Europe -- Simmonds S.A.R.L. of the issued and
outstanding Capital Stock of Technico, a French stock
corporation (Societe Anonyme), and SCI de la Praz, a
French real estate company (Societe Civile
Immobiliere),
(iv) from any Subsidiary of the Borrower which is not a
Guarantor to any other Subsidiary of the Borrower which
is not a Guarantor, and
(v) from any Subsidiary of the Borrower which is not a
Guarantor to the Borrower or a Guarantor; provided that
(A) at the time of making any such intercompany loan
there are no outstanding intercompany loans owing by
such Subsidiary to the Borrower or such Guarantor and
such intercompany loans to the Borrower or a Guarantor
are in amounts and on terms (including, without
limitation, terms of subordination to the Obligations)
satisfactory to the Collateral Agent and evidenced by a
promissory note in form and substance satisfactory to
the Collateral Agent and (B) the aggregate principal
amount of such intercompany loans made from and after
the Closing Date outstanding at any given time does not
exceed $10,000,000;
(d) Indebtedness in respect of Hedge Agreements in
respect of interest rates or foreign exchange contracts
so long as such Hedge Agreements are not entered into
for speculative purposes;
(e) 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;
(f) Indebtedness of the owner(s) of the
Farmingdale Property incurred in connection with the
development and operation of the Farmingdale Property;
provided that (i) such Indebtedness is subject to
agreements in form and substance satisfactory to the
Collateral Agent and (ii) if the holders of such
Indebtedness require that any Accommodation Obligation
be incurred in connection therewith for their benefit
by the Borrower or any Guarantor, such agreements are
executed and delivered on or before October 3, 1999;
(g) Indebtedness incurred by the Unrestricted
Subsidiaries without recourse to the Borrower or any
Restricted Subsidiary or any Property of the Borrower or any
Restricted Subsidiary; and
(h) 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 the
applicable Subsidiary than the terms of, the Permitted
Existing Indebtedness so extended, renewed, refunded or
replaced; and
(i) other secured (to the extent permitted by
Section 10.03) and unsecured Indebtedness of the
Borrower and its Subsidiaries in an aggregate amount
not to exceed $30,000,000 at any time outstanding, to
the extent permitted by Article XI, where applicable,
provided that:
(i) with respect to Indebtedness of the Borrower and
the Borrower's Subsidiaries with respect to Capital
Leases and purchase money Indebtedness, 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 $5,000,000, 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
reasonably satisfactory to the Collateral Agent, and
(ii) with respect to Indebtedness constituting
Accommodation Obligations, in the event the primary
Indebtedness supported by such Accommodation Obligation
is otherwise included in the calculation of permitted
Indebtedness under this Section 10.01, such primary
Indebtedness and Accommodation Obligation shall not be
included twice in determining compliance with this
Section 10.01.
10.02. Sales of Assets.?? The Borrower shall not and
shall not permit any of the Restricted Subsidiaries to sell,
assign, transfer, lease, convey or otherwise dispose of any
Property, whether now owned or hereafter acquired by such Person,
or any income or profits there-from, or enter into any agreement
to do so, except:
(a) any sale, lease, transfer or other
disposition of Permitted Dispositions, so long as (i)
any non-cash consideration resulting from such sale,
assignment, transfer, lease, conveyance or other
disposition is permitted under Section 10.04(i) and
pledged or assigned to the Collateral Agent, for the
benefit of the Holders, pursuant to an instrument in
form and substance acceptable to the Collateral Agent,
(ii) the Borrower com-plies 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), and (iii) with respect to a
transfer of the Capital Stock or assets of any
Technologies Company, Capital Stock of Nacanco, the
Farmingdale Property, and/or the other real estate
assets identified as being held for sale on Schedule
1.01.5 by dividend or distribution to the shareholders
of the Borrower, the same is permitted under Section
10.05;
(b) the transfer of (i) the Capital Stock or assets of
Fairchild Technologies Optical Disc Equipment Group GmbH to
a new indirect Subsidiary of the Borrower formed under the
laws of The Republic of Germany in accordance with the terms
of this Agreement and subsequent sale or other transfer of
such new Subsidiary or its assets to Fairchild Technologies
USA, Inc. and (ii) provided that the Collateral Agent has
consented in writing thereto, any sale or other transfer of
any other Property owned by the Borrower or any Subsidiary
of the Borrower to any Subsidiary of the Borrower;
(c) any sale of Inventory in the ordinary course of
the Borrower's and its Subsidiaries' respective businesses;
(d) any 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 its Subsidiaries' respective
businesses;
(e) the sale of Investments in Cash Equivalents
permitted pursuant to Section 10.04(c)(i) and Eligible
Marketable Securities permitted pursuant to Section
10.04(c)(ii);
(f) any sale, assignment, transfer, lease, conveyance
or other disposition of any Property having a Fair Market
Value, in the case of an individual asset sale, assignment,
transfer, lease, conveyance or other disposition, not
exceeding $1,000,000 or, in the case of aggregate asset
sales, assignments, transfers, leases, conveyances and other
dispositions in any Fiscal Year, not exceeding $5,000,000,
for consideration not less than the Fair Market Value
thereof, so long as (i) any non-cash consideration resulting
from such sale, assignment, transfer, lease, conveyance or
other disposition shall be pledged or assigned to the
Collateral Agent, for the benefit of the Holders, pursuant
to an instrument in form and substance acceptable to the
Collateral Agent and (ii) the Borrower com-plies 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);
(g) the sale of Receivables of Restricted Subsidiaries
which are not Domestic Subsidiaries pursuant to arrangements
(i) described on Schedule 10.02-G attached hereto and made a
part hereof which are in effect as of the Closing Date or
(ii) entered into after the Closing Date and disclosed in
writing to the Collateral Agent prior to their becoming
effective, in either event for the purpose of providing
working capital for such Restricted Subsidiaries and their
Affiliates which are not Domestic Subsidiaries;
(h) the transfer of Indebtedness arising under
intercompany loans outstanding or made to or by the Borrower
and Restricted Subsidiaries as permitted by Section 10.01 to
the Borrower or a Restricted Subsidiary in exchange for a
promissory note payable to the transferor in the amount of
such Indebtedness so transferred; and
(i) any transfer required to consummate any transaction
otherwise permitted under Sections 10.04, 10.05, 10.06,
10.08, and 10.09.
Notwithstanding anything in the foregoing to the contrary,
neither the Borrower nor any Restricted Subsidiary shall sell,
assign, transfer, lease, convey or otherwise dispose of any
Property, whether now owned or hereafter acquired by such Person,
or any income or profits there-from, to any Unrestricted
Subsidiary, or enter into any agreement to do so.
10.03. Liens. ??The Borrower shall not and shall not
permit any of the Borrower's 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;
(c) Customary Permitted Liens;
(d) Liens arising due to the creation of escrows of
proceeds from any sale, assignment, lease, transfer or other
disposition permitted under Section 10.02;
(e) Liens securing purchase money Indebtedness
(including the interest of a lessor under a Capital Lease or
an Operating Lease having substantially the same economic
effect) permitted under Section 10.01(i); provided, that
such Liens do not attach to any property other than that
purchased with the proceeds of such purchase money
Indebtedness (or leased); and
(f) Liens granted to secure Indebtedness permitted
under Section 10.01(f) against (i) the Farmingdale Property
and improvements made thereto, (ii) all fixtures,
furnishings, Equipment and other personal property used in
connection with the Farmingdale Property and such
improvements, (iii) all leases, subleases, licenses,
concession agreements, contracts, and managerial agreements,
entered into with respect thereto and permits affecting the
Farmingdale Property and improvements made thereto; and
Liens granted by Unrestricted Subsidiaries to secure other
Indebtedness permitted by Section 10.01(g).
10.04. Investments.?? The Borrower shall not and
shall not permit any of the Restricted Subsidiaries to directly
or indirectly make or own any Invest-ment except:
(a) 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, and additional Investments required to be
made pursuant to the terms of the Permitted Existing
Investments as disclosed on Schedule 1.01.8;
(b) Investments received in connection with the
bankruptcy or reorganization of suppliers and customers
and in settlement or composition of delinquent
obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;
(c) Investments (i) in Cash Equivalents and (ii) by
the Borrower in Eligible Marketable Securities; provided
that with respect to clause (ii) proceeds of the Loans are
not used to make Investments in Margin Stock and no
Revolving Loans are outstanding on the date any such
Investment is made;
(d) Investments made by the Borrower and
Restricted Subsidiaries in connection with acquisitions
of assets or equity Securities of any Person (other
than the Technologies Companies) in an aggregate amount
not to exceed (i) $17,500,000 in cash or assumed
Indebtedness until such time as the outstanding
principal balance of the Term Loans has been reduced by
$25,000,000 in the aggregate under Section 4.01(b)(vii)
from Net Cash Proceeds of Sale of Permitted
Dispositions and Net Cash Proceeds of Sale of Banner
Companies or (ii) thereafter (and when combined with
Investments made as permitted under the foregoing
clause (i)), $35,000,000 in cash or assumed
Indebtedness; provided that (A) no Event of Default or
Potential Event of Default has occurred and is
continuing unwaived or, after giving effect to the
making of any such Investment, no Potential Event of
Default or Event of Default would occur and (B) on a
pro forma basis, determined for the four (4) Fiscal
Quarters immediately preceding any such Investment
giving effect to such Investment as though it occurred
at the commencement of such four (4) Fiscal Quarter
period, no breach of any covenant included in Article
XI would have occurred; and provided further that the
aforesaid limitations specified in clauses (i) and (ii)
above shall (1) be increased by the amount of the Net
Cash Proceeds of Sale of Permitted Dispositions (other
than Net Cash Proceeds of Sale received in connection
with the sale or other disposition of Capital Stock of
Watkins-Johnson Company held by the Borrower or any
Subsidiary of the Borrower) net of the amount of such
Net Cash Proceeds of Sale of Permitted Dispositions
applied to the Obligations as provided under Section
4.01(b)(vii) and (2) include payments of cash made to
Robert Edwards in accordance with the Third Amendment
and Plan of Merger dated as of September 17, 1998 by
and among the Borrower, Special-T Fasteners, Inc., and
Robert Edwards, executed and delivered in connection
with the Borrower's acquisition of Special-T Fasteners,
Inc. and any related agreement entered into after the
Closing Date, only to the extent the same exceed
$2,000,000 in the aggregate;
(e) Investments by the Borrower in any other Person
(other than the Technologies Companies) in exchange for
Capital Stock of the Borrower; provided that (i) no Event of
Default or Potential Event of Default has occurred and is
continuing unwaived or, after giving effect to the making of
any such Investment, no Potential Event of Default or Event
of Default would occur and (ii) on a pro forma basis,
determined for the four (4) Fiscal Quarters immediately
preceding any such Investment giving effect to such
Investment as though it occurred at the commencement of such
four (4) Fiscal Quarter period, no breach of any covenant
included in Article XI would have occurred;
(f) an Investment by the Borrower in the form of the
contribution of Property which consists of (i) cash in an
amount not to exceed $10,000,000 in the aggregate and (ii)
Permitted Dispositions in connection with the Borrower's
formation of a Restricted Subsidiary to qualify as a small
business investment company, as such is defined in the Small
Business Investment Act of 1958, P.L. 85-699, as amended,
which small business investment company shall be deemed to
be an Unrestricted Subsidiary at all times from and after
its formation;
(g) an Investment by capital contribution of the
Capital Stock of Kaynar, directly or indirectly, to FHC and
of the Capital Stock of Special-T Fasteners, Inc., directly
or indirectly, to another Person included in the Fairchild
Fasteners Group Operating Unit;
(h) Investments by the Borrower, directly or through
intervening Restricted Subsidiaries, in Subsidiaries of the
Borrower which are Guarantors; and
(i) Investments received in connection with the sale,
transfer, disposition (including, without limitation, by
merger) of Permitted Dispositions (other than the Banner
Companies).
Notwithstanding anything in the foregoing to the contrary,
neither the Borrower nor any Restricted Subsidiary of the
Borrower shall make any Investment in an Unrestricted Subsidiary
and no Unrestricted Subsidiary shall make or own any Investment
in the Borrower or any Restricted Subsidiary. In no event shall
the Borrower or any of the Restricted Subsidiaries form, create
or establish any additional Subsidiaries or become a partner
(general or limited) in any Person, without the prior written
consent of the Collateral Agent. No other provision of this
Agreement shall be deemed to prohibit any Investment which is
specifically permitted by this Section 10.04.
10.05. ??Restricted Junior Payments.?? The Borrower
shall not and shall not permit any of the Restricted Subsidiaries
to declare or make any Restricted Junior Payment, except:
(a) subject to the limitations set forth in
Section 10.06 where applicable, dividends or
distributions to the Borrower on the Capital Stock of
any of its Wholly-Owned Subsid-iaries or to any of the
Borrower's Wholly-Owned Subsid-iaries from any other
Wholly-Owned Subsidiary of such Borrower or any
Subsidiary of the Borrower existing on the date of this
Agreement;
(b) cash dividends or distributions on the Capital
Stock of the Borrower which is Class A Common Stock not to
exceed the lesser of (i) one cent ($0.01) per share of such
Class A Common Stock or (ii) $400,000 in the aggregate;
(c) cancellations of intercompany Indebtedness
which are treated as dividends; and
(d) dividends and distributions of the Capital Stock
of the Technologies Companies, or any of them, Capital Stock
of Nacanco, the Farmingdale Property or Capital Stock of the
owner thereof, and/or the other real estate assets
identified as being held for sale on Schedule 1.01.5 to
shareholders of the Borrower; provided that (i) no Event of
Default or Potential Event of Default has occurred and is
continuing unwaived or, after giving effect to any such
dividend or distribution, no Potential Event of Default or
Event of Default would occur and (ii) on a pro forma basis,
determined for the four (4) Fiscal Quarters immediately
preceding any such dividend or distribution giving effect to
such dividend or distribution as though it occurred at the
commencement of such four (4) Fiscal Quarter period, no
breach of any covenant included in Article XI would have
occurred and, with respect to dividends and distributions of
Capital Stock of Nacanco and the Farmingdale Property or
Capital Stock of the owner thereof, provided further that
prior to any such dividend or distribution the outstanding
principal balance of the Term Loans shall have been reduced
by $37,500,000 in the aggregate under Section 4.01(b)(vii)
from Net Cash Proceeds of Sale of Permitted Dispositions and
Net Cash Proceeds of Sale of Banner Companies.
10.06. Restriction on Fundamental Changes.?? The
Borrower shall not and shall not permit any of the Borrower's
Subsidiaries to (a) enter into any merger or consolidation, or
liquidate, wind-up or dissolve (or suffer any liquidation or
dissolution), except:
(i) the liquidation or dissolution of Fairchild
Fastener Group Ltd. and JJS Limited on or before June 30,
2000;
(ii) the merger or liquidation of (A) any Restricted
Subsidiary with and into the Borrower or any Guarantor;
provided that such Persons are part of the same Operating
Unit both before and after such merger or liquidation, (B)
any Guarantor with and into any other Guarantor; provided
that such Persons are part of the same Operating Unit both
before and after such merger or liquidation, (C) any
Restricted Subsidiary which is not included as part of an
Operating Unit with and into any other such Person, and (D)
any Subsidiary of the Borrower not described in clauses (A),
(B), or (C) above with and into any other such Subsidiary of
the Borrower; provided that the prior written consent
thereto of the Collateral Agent has been obtained; and
(iii) the merger of Special-T Fasteners, Inc. with and
into FHC or another Person included in the Fairchild
Fasteners Group Operating Unit and the merger of Kaynar with
and into FHC; 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 here-after
acquired, except as permitted by Section 10.02; or (c) except to
the extent consented to in writing by the Administrative Agents,
discontinue the operations of any Subsidiary of the Borrower.
10.07. Conduct of Business; Accounting and Reporting
Practices.?? The Borrower shall not and shall not permit any of
the Borrower's Subsidiaries (a) other than Unrestricted
Subsidiaries, to engage in any business other than (i) the
businesses engaged in by the Borrower and the Borrower's
Subsidiaries on the Closing Date and (ii) any business or
activities which are sub-stantially similar, related or
incidental thereto, or (b) change any of its or their accounting
or financial reporting policies or practices from those in effect
on the Closing Date, except to the extent required to provide the
financial reporting described in Section 8.01(a).
10.08. Transactions with Shareholders and
Affiliates.?? The Borrower shall not and shall not permit any of
the Borrower's Subsidiaries to directly or indirectly enter into
or permit to exist any trans-action (includ-ing, without
limitation, the sale, lease, exchange or transfer of any property
(other than as permitted by Section 10.02) or the rendering of
any service) or the purchase of any property (other than as
permitted by Section 10.04, where applicable) with any Affiliate
on terms that are less favorable to the Borrower or such
Subsidiaries, as applicable, than those that might be obtained in
an arm's length transac-tion at the time from Persons who are not
an Affil-iate. Nothing contained in this Section 10.08 shall
prohibit (a) any trans-action expressly permitted by Sections
10.05 and 10.06; (b) increases in compensation and benefits for,
or payment of bonuses to, officers and employees of the Borrower
or any of the Borrower's 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 direc-tors' fees and indemni-ties of
officers and directors; or (d) any transaction between a (i)
Technologies Company and an Affiliate which is also a
Technologies Company or (ii) one Unrestricted Subsidiary with
another Unrestricted Subsidiary (other than transactions between
any Technologies Company and an Unrestricted Subsidiary).
10.09. ?? Sales and Leasebacks.?? The Borrower shall
not and shall not permit any of the Restricted Subsidiaries to
become liable, directly, by assump-tion 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 such Person (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 trans-ferred by such Person to any other
Person, in either instance, in connection with such lease, except
for the sale/leaseback transactions identified on Schedule 10.09.
10.10. Margin Regulations; Securities Laws.?? The
Borrower shall not or permit any of the Borrower's Subsidiaries
to use all or any por-tion of the proceeds of any credit extended
under this Agree-ment to purchase or carry Margin Stock or for
purposes other than those described in Section 2.04.
10.11. ERISA.?? The Borrower shall not:
(a) engage, or permit any of the Borrower's
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 pre-viously 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 install-
ments 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 the Borrower or any ERISA Affiliate under
Title IV of ERISA;
(e) fail to make any contribution or payment to
any Multiemployer Plan which the Borrower or any ERISA
Affiliate may be required to make under any agreement
relating to such Multiemployer Plan, or any law per-
taining 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 lia-bility 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.
10.12. Issuance of Equity Securities. ??The Borrower
shall not, and shall not permit any of the Restricted
Subsidiaries to, issue any equity Securities except (a) equity
Securities pursuant to Permitted Equity Securities Options, (b)
in exchange for Investments as permitted by Section 10.04(e), and
(c) equity Securities of the Borrower provided that the Borrower
complies with the mandatory prepayment provisions set forth in
Section 4.01(b).
10.13. Organizational Documents; Material Contractual
Obligations.?? The Borrower shall not, and shall not permit any
of the Restricted Subsidiaries to, amend, modify or otherwise
change any of the terms or provisions in any of (a) their
respective Organizational Documents as in effect on the Closing
Date, except (i) with respect to which written notice shall have
been provided to the Collateral Agent (A) no less than ten (10)
days prior to the effective date of any such amendment,
modification or change made with respect to the Borrower or any
such Domestic Subsidiary and (B) concurrent with such amendment,
modification or change made with respect to any other Restricted
Subsidiary and (ii) if no Event of Default or Potential Event of
Default would result therefrom or (b) Contractual Obligations
evidencing any debt Securities, including, without limitation,
the Senior Subordinated Note Indenture or Senior Subordinated
Notes, or other material Contractual Obligations.
10.14. Bank Accounts.?? The Borrower shall not, and
shall not permit any of its Subsidiaries to, establish or
maintain any Deposit Account into which collections of
Receivables and proceeds of other Collateral are deposited other
than (a) those identified as existing on the Closing Date and
disclosed on Schedule 10.14 attached hereto or (b) which are
established after the Closing Date in the United States by the
Borrower and its Subsidiaries which are in amounts aggregating no
more than $5,000,000 at any given time are on deposit, without
the prior written consent of the Collateral Agent and which
(other than with respect to the accounts referenced in clause (b)
above), if collections of Receivables or proceeds of Collateral
are deposited therein, are subject to Collection Account
Agreements or other arrangements (including, without limitation,
pledge agreements) satisfactory to the Collateral Agent.
10.15. Fiscal Year; Fiscal Quarters.?? The Borrower
shall not and shall not permit any of the Borrower's Subsidiaries
(other than Banner, Kaynar, SNEP S.A., and any Person acquired in
compliance with the provisions of Section 10.04 after the Closing
Date which thereupon becomes a Subsidiary of the Borrower;
provided that all such Subsidiaries shall have changed their
fiscal quarters and fiscal years to coincide with the Fiscal
Quarters and Fiscal Years by the last day of the first full
Fiscal Year next succeeding (a) the Closing Date (in the case of
Banner, Kaynar and SNEP S.A.) or (b) the Fiscal Year in which
such Person becomes a Subsidiary of the Borrower) to maintain or
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 or to change the ending dates for any Fiscal
Quarter.
ARTICLE XI
FINANCIAL COVENANTS
??
The Borrower covenants and agrees that so long as any
Revolving Credit 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 and
its Subsidiaries on a consolidated basis shall have, as of the
end of each Fiscal Quarter set forth below, for the four (4)
Fiscal Quarters then ending, an Interest Coverage Ratio of no
less than that set forth below opposite such period:
Four Fiscal
Quarters Ending Ratio
June, 1999 2.00 to 1.0
and each Fiscal
Quarter thereafter
through March, 2004
June, 2004 2.25 to 1.0
and each Fiscal
Quarter thereafter
through March, 2006
11.02. Capital Expenditures.?? The Borrower and its
Subsidiaries on a consolidated basis shall not make Capital
Expenditures in any Fiscal Year in excess of the greater of (a)
the Borrower's consolidated net income for the immediately
preceding Fiscal Year or (b) with respect to (i) the Borrower and
its Subsidiaries other than Kaynar for the Fiscal Year ending
June 30, 1999 and Kaynar and its Subsidiaries for the period
commencing on the Closing Date and ending on June 30, 1999
$40,000,000 in the aggregate and (ii) each Fiscal Year ending
after June 30, 1999, $40,000,000; provided, however, in the event
the Borrower and its Subsidiaries have not made Capital
Expenditures in the amount permitted herein for any Fiscal Year,
Capital Expenditures in an amount equal to that portion of the
maximum amount of such Capital Expenditures permitted but not
made in such Fiscal Year (but not to exceed fifty percent (50%)
of such maximum amount) may be made in the immediately next
succeeding Fiscal Year in addition to any amounts permitted above
for such succeeding Fiscal Year; provided that (A) amounts
carried forward from one Fiscal Year to a succeeding Fiscal Year
may only be expended or accrued for Capital Expenditures after
the maximum amount permissible for such succeeding Fiscal Year
have been expended or accrued and (B) to the extent amounts
carried forward from one Fiscal Year to the next succeeding
Fiscal Year are not expended or accrued in such succeeding Fiscal
Year, such surplus may not be carried forward to any other
succeeding year.
11.03. Consolidated Senior Indebtedness to EBITDA
Ratio.?? The Borrower and its Subsidiaries on a consolidated
basis shall have, as of the end of each Fiscal Quarter set forth
below, a Consolidated Senior Indebtedness to EBITDA Ratio as of
the end of such Fiscal Quarter for the four (4) Fiscal Quarters
then ending of no more than the ratio set forth opposite such
Fiscal Quarter end set forth below:
Fiscal Quarter Ending Maximum Ratio
June, 1999 3.20 to 1.0
and each Fiscal Quarter
thereafter through
March, 2002
June, 2002 3.00 to 1.0
and each Fiscal Quarter
thereafter
11.04. Consolidated Indebtedness to EBITDA Ratio.??
The Borrower and its Subsidiaries on a consolidated basis shall
have, as of the end of each Fiscal Quarter set forth below, a
Consolidated Indebtedness to EBITDA Ratio as of the end of such
Fiscal Quarter for the four (4) Fiscal Quarters then ending of no
more than the ratio set forth opposite such Fiscal Quarter end
set forth below:
Fiscal Quarter Ending Maximum Ratio
June, 1999 5.70 to 1.0
and each Fiscal Quarter
thereafter through
March, 2003
June, 2003 5.50 to 1.0
and each Fiscal Quarter
thereafter through
March 2004
June, 2004 4.75 to 1.0
and each Fiscal Quarter
thereafter
11.05. ??Minimum Consolidated Fixed Charge Coverage
Ratio. ?? The Borrower shall maintain, as determined as of the
end of each Fiscal Quarter set forth below for the four (4)
Fiscal Quarters then ending, a Consolidated Fixed Charge Coverage
Ratio of no less than that set forth below opposite such Fiscal
Quarter end set forth below:
Fiscal Quarter Ending Minimum Ratio
June, 1999 1.25 to 1.0
and each Fiscal Quarter
thereafter through
March, 2003
June, 2003 1.35 to 1.0
and each Fiscal Quarter
thereafter through
March, 2004
June, 2004 1.50 to 1.0
and each Fiscal Quarter
thereafter
11.06. EBITDA Calculations.??
(a) All calculations of EBITDA made with respect to
Sections 11.01 and 11.05 shall be made on a pro forma basis to
include earnings of Persons, which are operating companies and
were acquired during the period commencing on July 1, 1998 and
ending on the Closing Date and exclude earnings of Persons which
are operating companies sold, divested, or otherwise disposed of
during the period commencing on July 1, 1998 and ending on the
Closing Date during the four Fiscal Quarters then ended giving
effect to such acquisition, sale, divestiture or disposal as
though it had occurred on the first day of such four Fiscal
Quarter period.
(b) All calculations of EBITDA made with respect to
Sections 11.03 and 11.04 shall be made on a pro forma basis to
include earnings of Persons, which are operating companies and
(i) were acquired during the period commencing on July 1, 1998
and ending on the Closing Date or (ii) are acquired after the
Closing Date as permitted by Section 10.04 and exclude earnings
of Persons which are operating companies sold, divested, or
otherwise disposed of (1) during the period commencing on July 1,
1998 and ending on the Closing Date or (ii) after the Closing
Date as permitted by this Agreement, during the four Fiscal
Quarters then ended giving effect to such acquisition, sale,
divestiture or disposal as though it had occurred on the first
day of such four Fiscal Quarter period.
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 for which it is obligated hereunder or
(ii) within one (1) Business Day after the due date therefor, any
other Obligation for which it is obligated.
(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, 9.12, or 9.14, 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
Collateral Agent, any Lender or any Issu-ing Bank herein or by
the Borrower or any Subsidiary of the Borrower 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 mislead-ing 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) applicable thereto 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 Subsidiary of the Borrower shall fail to make any payment
when due (whether by scheduled maturity, required prepayment,
accelera-tion, demand or otherwise) with respect to any other
Indebtedness (other than an Obligation) of such Borrower and its
Subsidiaries aggregating $2,000,000 or more; or any breach,
default or event of default shall occur, or any other condition
shall exist under any instrument, agreement or indenture per-
taining 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 such Borrower or
any of its Subsidiaries (other than by a regularly scheduled
required prepayment) prior to the stated maturity thereof.
Notwithstanding the foregoing, (i) the foregoing shall only apply
with respect to Indebtedness of Unrestricted Subsidiaries to the
extent the holder(s) of such Indebtedness (A) is/are the Borrower
or a Restricted Subsidiary or (B) have any recourse to the
Borrower or any Restricted Subsidiary or any of their Property in
connection with such Indebtedness and (ii) no breach of any
obligation, default or event of default (payment or otherwise),
or acceleration of any obligation with respect to the German
Acquisition Loans shall constitute an Event of Default under this
Agreement.
(f) Involuntary Bankruptcy; Appointment of Receiver,
Etc. (i) An involuntary case shall be commenced against the
Borrower or any Subsidiary of the Borrower 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 Subsidiary of the
Borrower in an invol-untary 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 juris-diction
in the premises for the appointment of a receiver, liquidator,
sequestrator, trustee, custodian or other officer having similar
powers over the Borrower or any Su-bsidiary of the Borrower or
over all or a substantial part of the Property of any such Person
shall be entered; or an interim receiver, trustee or other
custodian of the Borrower or any Subsidiary of the Borrower or of
all or a substan-tial part of the Property of any such Person
shall be appointed or a war-rant of attachment, execution or
similar process against any substantial part of the Property of
the Borrower or any Subsidiary of the Borrower shall be issued
and any such event shall not be stayed, dis-missed, bonded or
discharged within thirty (30) days after entry, appointment or
issuance.
(iii) Notwithstanding anything to the contrary
contained herein, the foregoing shall only apply to an
Unrestricted Subsidiary if the Borrower or any Restricted
Subsidiary is, at the time of such commencement or decree, or
thereafter becomes, a creditor of such Unrestricted Subsidiary or
is or becomes subject to any action or proceeding in any such
case against or which could have an adverse impact upon the
assets or ability of the Borrower or any Restricted Subsidiary to
pay the Obligations in accordance with their terms (including,
without limiting the foregoing, any proceeding for substantive
consolidation or equitable subordination).
(g) Voluntary Bankruptcy; Appointment of Receiver,
Etc. The Borrower or any Subsidiary of the Borrower 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
any such Person shall make any assignment for the benefit of
credi-tors 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 any such Person (or any
committee thereof) adopts any resolution or otherwise authorizes
any action to approve any of the fore-going; provided, however,
that the foregoing shall only apply to an Unrestricted Subsidiary
if the Borrower or any Restricted Subsidiary is, at the time of
such commencement, consent, or assignment, or thereafter becomes,
a creditor of such Unrestricted Subsidiary or is or becomes
subject to any action or proceeding in any such case against or
which could have an adverse impact upon the assets or ability of
the Borrower or any Restricted Subsidiary to pay the Obligations
in accordance with their terms (including, without limiting the
foregoing, any proceeding for substantive consolidation or
equitable subordination).
(h) Dissolution. Any order, judgment or decree shall
be entered against the Borrower or any Subsidiary of the Borrower
decreeing its involuntary dis-solution or split up and such order
shall remain undischarged and unstayed for a period in excess of
sixty (60) days; or any such Person shall otherwise dissolve, be
dissolved, or cease to exist except as specifically permitted by
this Agreement. Notwithstanding anything to the contrary
contained herein, the foregoing shall only apply to an
Unrestricted Subsidiary if the Borrower or any Restricted
Subsidiary is, at the time of such order, judgment, decree, or
dossolution, or thereafter becomes, a creditor of such
Unrestricted Subsidiary or is or becomes subject to any action or
proceeding in any such case against or which could have an
adverse impact upon the assets or ability of the Borrower or any
Restricted Subsidiary to pay the Obligations in accordance with
their terms (including, without limiting the foregoing, any
proceeding for substantive consolidation or equitable
subordination).
(i) Loan Documents; Failure of Security. At any time,
for any reason, (i) any Loan Docu-ment ceases to be in full force
and effect (other than as terminated or released as permitted
therein or by Section 13.09) or the Borrower or Subsidiary of the
Borrower party thereto seeks to repudiate its obligations
thereunder or the Liens intended to be created thereby are, or
the Borrower or such Subsidiary seeks to render such Liens,
invalid or unperfected, or (ii) Liens in favor of the Collateral
Agent for the benefit of the Holders contemplated by the Loan
Documents shall, at any time, for any reason other than the gross
negligence or willful misconduct of the Collateral Agent or any
Lender, 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,
except to the extent contemplated by the terms of Section 13.09
and Schedule 10.09.
(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 Subsidiary
of the Borrower or any of their respective assets involv-ing in
any case an amount in excess of $2,000,000 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 $12,000,000, 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 the Borrower or any
ERISA Affiliate to liability in excess of $2,000,000, for which
adequate reserves are not maintained.
(l) Waiver Application. The plan administrator of any
Benefit Plan applies under Section 412(d) of the Internal Revenue
Code for a waiver of the minimum funding standards of Section
412(a) of the Internal Revenue Code and the Collateral Agent
believes that the substantial business hardship upon which the
application for the waiver is based could subject the Borrower or
any ERISA Affiliate to liability in excess of $2,000,000, for
which adequate reserves are not maintained.
(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.
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 Lenders' respective obligations to make 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 imme-diately due and payable, without
presentment, demand, or protest or other requirements of any kind
(including, without limitation, valua-tion and appraisement,
diligence, pre-sentment, notice of intent to demand or accelerate
and of accel-eration), 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 Collateral Agent
shall at the request, or may with the consent, of the Requisite
Lenders, by written notice to the Borrower, (i) declare that the
Lenders' respective obligations to make Revolving Loans under the
Revolving Credit Commitments are terminated, whereupon such
obligation of each such Lender to make any 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 Obliga-tions 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, valua-tion 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 addi-tion,
after the occurrence and during the continuance of an Event of
Default, the Borrower shall, promptly upon demand by the
Collateral Agent, deliver to the Collateral Agent, Cash
Collateral in such form as requested by the Collateral Agent for
deposit in the Cash Collateral Account, together with such
endorsements, and execution and delivery of such documents and
instruments, as the Collateral Agent may request in order to
perfect or protect the Collateral Agent's Lien with respect
thereto, in the applicable amount described in Section
3.01(a)(iv).
(c) Rescission. If at any time after termination of
the 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 other-wise
than by acceleration (with interest on principal and, to the
extent permitted by law, on overdue interest, at the rates speci-
fied 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 Lenders'
respective obligations to make Revolving Loans under the
Revolving Credit Commitments and the respective Lenders' and
Issuing Banks' obligations to participate in or issue Letters of
Credit and/or the aforesaid acceleration and its conse-quences
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 Lenders or Issuing Banks or any
acceleration here-under, even if the condi-tions set forth herein
are met.
(d) Enforcement. The Borrower acknowledges that in
the event the Borrower or any Subsidiary of the Borrower 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
Collateral Agent, the Issuing Banks and the Lenders; therefore,
the Borrower agrees that the Collateral 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 AGENTS AND COLLATERAL AGENT??
13.01. Appointment.?? (a) Each Lender and each
Issuing Bank hereby designates and appoints (i) Citicorp and
NationsBank as the Administrative Agents of such Lender or such
Issuing Bank under this Agreement and (ii) Citicorp as the
Collateral Agent of such Lender or such Issuing Bank under this
Agreement; and each Lender and each Issuing Bank hereby irre-
vocably authorizes the Collateral Agent to take such action on
its behalf under the provisions of this Agreement and the Loan
Docu-ments and to exercise such powers as are set forth herein or
therein together with such other powers as are reasonably
incidental thereto. The Collateral Agent hereby agrees to act in
the aforesaid capacities on the express conditions contained in
this Article XIII.
(b) The provisions of this Article XIII are solely for
the benefit of the Administrative Agents, the Collateral 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 per-forming its functions and duties
under this Agreement, the Collateral Agent shall act solely as
Collateral 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 Collateral Agent
may perform any of its respective duties hereunder, or under the
other Loan Documents, by or through its agents or employees.
13.02. Nature of Duties. ??The Administrative Agents
shall not have any duties or responsibilities other than those
expressly set forth in this Agreement or in the Loan Documents.
The Collateral Agent shall not have any duties or
responsibilities other than those expressly set forth in this
Agreement or in the Loan Documents. The duties of the Collateral
Agent shall be mechanical and administrative in nature. Neither
shall either Administrative Agent or the Collateral Agent have,
by reason of this Agreement, any fiduciary relation-ship 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 Agents or the
Collateral Agent any obligations in respect of this Agreement or
any of the other Loan Documents other than 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 their Affiliates in connection with
the making and the con-tinuance 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 no Administrative Agent
or Collateral Agent shall 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 Collateral Agent under
the terms of this Agreement). If the Collateral Agent seeks the
consent or approval of the Lenders to the taking or refraining
from taking of any action hereunder, the Collateral Agent shall
send notice thereof to each Lender. The Collateral Agent shall
promptly notify each Lender at any time that the Lenders so
required hereunder have instructed the Collateral 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 or Article V when due)
or the other Loan Documents, the Collateral Agent shall not be
required to exercise any discretion or take any action.
Notwithstanding the foregoing, the Collateral 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; provided, however, the
Collateral Agent shall not be required to take any action which
(i) the Collateral Agent reasonably believes will expose it to
personal liability unless the Collateral 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 Agents, the
Collateral Agent, any Affiliate of an Administrative Agent or the
Collateral Agent, or any of their respective officers, directors,
employees or 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 Collateral Agent shall not
be liable for any apportionment or distri-bution of payments made
by it in good faith pursuant to Section 4.02(b), and, if any such
appor-tionment or distribution is subse-quently 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. Neither the Administrative
Agents nor the Collateral Agent shall be responsible to any
Holder for any recitals, statements, represen-tations or
warranties herein or for the execution, effectiveness,
genuineness, valid-ity, legality, enforce-ability,
collectibility, or suffic-iency of this Agreement or any of the
other Loan Documents or the transac-tions contemplated thereby,
or for the financial condition of the Borrower or any of its
Affiliates or the Guarantors. The Collateral Agent shall not be
required to make any inquiry con-cerning 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 Collateral
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 Collateral Agent is per-mitted or required
to take or to grant, and shall be absolutely entitled to refrain
from taking any action or to with-hold any approval and shall not
be under any liability whatsoever to any Person for refraining
from any action or with-holding any approval under any of the
Loan Documents until it shall have received such instructions
from those Lenders from whom the Collateral 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 Collateral Agent as a result of its 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 Agree-ment, a greater proportion of
the Lenders.
13.04. Reliance.?? The Collateral 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 mat-ters pertain-ing 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
Collateral Agent is required under the terms of the Loan
Documents to be reimbursed and indemnified by the Borrower but is
not reimbursed and indemnified by the Borrower, the Lenders will
reimburse and indemnify the Collateral Agent for and against any
and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or dis-burse-ments 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
Collateral 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
Revolving Credit Pro Rata Share and the Loans made by it,
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 indi-cates, 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 Collateral Agent
pursuant hereto.
13.07. Successor Collateral Agents??. (a)
Resignation. The Collateral 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 Collateral Agent
of appoint-ment pursuant to this Section 13.07.
(b) Appointment by Requisite Lenders. Upon any such
notice of resignation, an Administrative Agent shall have the
right to be appointed as a successor Collateral Agent and, if
such Administrative Agent declines such right to appointment, the
Requisite Lenders shall have the right to appoint a successor
Collateral 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 Collateral Agent. If a
successor Collateral Agent shall not have been appointed within
the thirty (30) Business Day period provided in clause (a) of
this Section 13.07, the retiring Collateral 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 Collateral Agent who shall serve as such until such
time, if any, as the Requisite Lenders appoint a successor
Collateral Agent as provided above.
(d) Rights of the Successor and Retiring Collateral
Agents. Upon the acceptance of any appointment as Collateral
Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the
retiring Collateral Agent, and the retiring Collateral Agent
shall be discharged from its duties and obligations under this
Agreement. After any retiring Collateral Agent's resignation
hereunder as Collateral 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 Collateral 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 under the other Loan Documents with respect to any
Collateral, with-out 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 Revolving Loan
Commitment except in accordance with Section 12.02(a).
13.09. Concerning the Collateral and the Loan
Documents.?? (a) Protective Advances. The Collateral 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 Collateral 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 in an amount outstanding at any time not to
exceed $20,000,000 ("Protective Advances"). The Collateral Agent
shall promptly 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 Collateral 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 Collateral Agent, the
Collateral Agent shall promptly notify each Lender and each
Lender agrees that it shall thereupon make available to the
Collateral Agent, in Dollars in immediately available funds, the
amount equal to such Lender's Pro Rata Share of such Protective
Advance. If such funds are not made available to the Collateral
Agent by such Lender within one (1) Business Day after the
Collateral Agent's demand therefor, the Collateral Agent will be
entitled to recover any such amount from such Lender together
with interest thereon at the Federal Funds Rate for the first day
after the date of such demand and at the interest rate applicable
to Base Rate Loans that are Revolving Loans for each day during
the period commencing on the second day after the date of such
demand and ending on the date such amount is received. The
failure of any Lender to make available to the Collateral Agent
its Pro Rata Share of any such Protective Advance shall neither
relieve any other Lender of its obligation hereunder to make
available to the Collateral Agent such other 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 Lender to make
such payment to the Collateral 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 Collateral 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 Collateral 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 Collateral 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 Collateral Agent shall have the sole and exclusive right and
authority to (i) act as the disbursing and collecting agent for
the Lenders and the Issuing Banks with respect to all payments
and collections of the Obligations of the Borrower arising in
connection with this Agreement and the Loan Documents or 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 Subsidiary of the
Borrower, 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 Collateral Agent hereby appoints,
authorizes and directs the Lenders and the Issuing Banks to act
as collateral sub-agents for the Collateral 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
Agents, the Collateral 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 and Unrestricted
Subsidiaries. (i) Each Lender and each Issuing Bank hereby
directs, in accordance with the terms of this Agree-ment, the
Collateral Agent to release any Lien held by it 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 per-mitted by Section
10.02 or is otherwise consented to by the Requisite
Lenders, as certified to the Collateral Agent by the
Borrower in an Officer's Certificate and any mandatory
prepayments required with respect to the proceeds of
such sale or disposition are made; 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 Collateral 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; provided that the Collateral Agent shall have
received the proceeds of the Collateral subject to such Liens to
which the Lenders and Issuing Banks are entitled under the terms
of this Agreement and the other Loan Documents.
(iii) Each Lender and Issuing Bank hereby authorizes
the Collateral Agent, on behalf of such Lenders and Issuing
Banks, to release any Unrestricted Subsidiary from its
obligations as a Guarantor and the Liens granted by such
Unrestricted Subsidiary to secure the Obligations and its
guaranty obligations in the event such Unrestricted Subsidiary
obtains financing the terms of which do not permit such
Indebtedness or Liens.
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 with-out reduction for
any and all present or future taxes, levies, imposts, deductions,
charges, withhold-ings, and all stamp or docu-mentary 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 other-wise with respect to, any of the Loan
Documents or the Revolving Credit Commit-ments and all other
liabilities with respect thereto excluding, in the case of each
Lender, each Issuing Bank and the Collateral 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 juris-diction 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 organ-ized, managed and controlled or any
political subdivision thereof (all such non-excluded taxes,
levies, imposts, deduc-tions, 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 Collateral Agent,
(x) the sum payable to such Lender, Issuing Bank, or the
Collateral 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
Collateral 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) such Borrower shall make such
withholding or deduc-tions, and (z) such Borrower shall pay the
full amount withheld or deducted to the relevant taxation
authority or other authority in accordance with appli-cable law.
(b) Indemnification. The Borrower will indemnify each
Lender, each Issuing Bank, each Administrative Agent, and the
Collateral 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, such Administrative Agent or the Collateral Agent
(as the case may be) or any of their respective Affiliates and
any lia-bil-ity (including penalties, interest, and out-of-pocket
expenses paid to third parties) arising there-from or with
respect thereto, whether or not such Taxes were lawfully pay-
able. A certificate as to any additional amount payable to any
Person under this Section 14.01 submitted by it to the Borrower
shall, absent mani-fest error, be final, conclusive and binding
upon all parties hereto. Each Lender and each Issuing Bank
agrees, within a reason-able time after receiving a written
request from the Borrower, to provide the Borrower and the
Collateral 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
Collateral 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 Collateral 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 here-under and under the Notes
without deduc-tion or withholding of United States federal income
tax (I) under the provi-sions of an applicable tax treaty
concluded by the United States (in which case the certificate
shall be accom-panied 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
Borrower and the Collateral Agent from time to time, a true and
accurate certificate executed in duplicate by a duly author-ized
officer of such Lender before or promptly upon the occurrence of
any event requiring a change in the most recent certificate
previously deliv-ered by it to the Borrower and the Collateral
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 here-under and under the Notes without
deduction or withholding of United States federal
income tax;
(B) that such Lender cannot continue to receive
payments here-under and under the Notes without
deduction or withholding of United States federal
income tax as specified therein but does not require
additional payments pur-suant to Section 14.01(a)
because it is entitled to recover the full amount of
any such deduction or with-holding from a source other
than the Borrower; or
(C) that such Lender is no longer capable of
receiv-ing 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 recov-ering the full amount of the same
from a source other than the Borrower.
Each Lender agrees to deliver to the Borrower and the Collateral
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 Collateral 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
implementa-tion 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 jurisdic-tion, 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 Collateral
Agent), the Borrower shall immediately pay to the Collateral
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
Affili-ate) to charges (other than taxes) of any kind
which such Lender or Issuing Bank reasonably determines
to be applicable to Eurodollar Rate Loans outstanding
under this Agreement or the Revolving Credit
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, inter-est, 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 appli-
cable, 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
require-ment 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 Issu-ing 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 Revolving Credit Commitment 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 Collateral Agent), the Borrower shall
immediately pay to the Collateral 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 neces-
sary 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
deter-mines (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, govern-mental rule, regu-lation or order of
any Governmental Authority (whether or not having the force of
law and whether or not fail-ure to comply therewith would be
unlawful or would result in costs or penal-ties), then, and in
any such event, such Lender may give notice of that
determination, in writing, to the Borrower and the Collateral
Agent, and the Collateral 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 imme-diately 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 outstand-ing, 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 Collateral 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
Collateral Agent, and the Collateral 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 Revolving
Eurodollar Rate Margin or Term 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 them 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 limita-tion, pursuant to
Section 5.02(d), (ii) if for any reason any Eurodollar Rate Loan
is prepaid (including, without limitation, manda-torily 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 conver-sion of a Eurodollar Rate Loan to a Base Rate
Loan as a result of any of the events indicated in Section
5.02(d) or Section 14.04, or (iv) as a consequence of any failure
by the Borrower to repay Eurodollar Rate Loans made to it when
required by the terms of this Agree-ment. The Lender making
demand for such compensation shall deliver to the Borrower
concurrently with such demand a written state-ment 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.
14.08. Judgment Currency.?? If for the purposes of
obtaining judgment in any court it is necessary to convert a sum
due under this agreement or any Note in any currency (the "first
currency") into another currency (the "second currency"), the
parties hereto agree, to the fullest extent permitted by law,
that the Exchange Rate used shall be that determined on the
Business Day preceding that on which final judgment is given. To
the fullest extent permitted by applicable law, the Obligation in
respect of any sum due in a first currency shall, notwithstanding
any judgment in a second currency, be discharged only to the
extent that on the Business Day following receipt by any of the
Collateral Agent, any Lender or any Issuing Bank of any sum
adjudged to be so due in the second currency, such Person may
purchase the first currency with the second currency at the
Exchange Rate determined on the date of such purchase; if the
amount of the first currency so purchased is less than the sum
originally due to such Person in the first currency, the Borrower
agrees, as a separate obligation and notwithstanding any such
judgment, to indemnify such Person against such loss, and if the
amount of the first currency so purchased exceeds the sum
originally due to such Person in the first currency, such Person
agrees to remit to the Borrower such excess.
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 Loans and the Letters of Credit)
in accord-ance with the provisions of this Section 15.01.
(b) Limitations on Assignments. Each assign-ment
shall be subject to the following condi-tions: (i) each such
assignment may be of any of the following: (A) all of a Lender's
outstanding Term Loan, (B) all of a Lender's Revolving Credit
Commitment (together with its Revolving Loans and participations
in outstanding Letters of Credit), (C) any portion of a lender's
Term Loan or Revolving Credit Commitment; provided that such
assignment is made to another Lender or an Affiliate of a Lender,
and (D) in the event a Lender desires to assign a portion of
either its Term Loan or Revolving Credit Commitment to a Person
which is not a Lender or Affiliate of a Lender, such assignment
shall be in a minimum principal amount of $2,500,000 and may be
of either a portion of such Lender's Term Loans, Revolving Credit
Commitment (together with a like portion of its Revolving Loans
and participation in outstanding Letters of Credit) or a
combination thereof; (ii) each such assignment shall be of a
constant, and not a varying, ratable percentage of all of the
assigning Lender's rights and obliga-tions under this Agreement
which are subject to such assignment; (iii) each such assignment
shall be to an Eligible Assignee consented to by the Collateral
Agent, which consent shall not be unreasonably withheld or
delayed; (iv) unless an Event of Default shall have occurred and
be continuing unwaived, the Borrower shall have the right to
approve each such Eligible Assignee which is not another Lender
or an Affiliate of a Lender, which approval shall not be
unreasonably withheld or delayed; and (v) the parties to each
such assignment shall execute and deliver to the Collateral
Agent, for its acceptance and recording in the Reg-ister, 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 Accep-tance and
agreed to by the Collateral Agent, (A) the assignee there-under
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 Assign-ment 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 pur-suant 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 obliga-tions 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 Collateral 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 their respective Revolving Credit
Commitments, and the prin-cipal amount of the Loans 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 the Guarantors, the Collateral
Agent, and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all pur-poses
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 (pay-able by the
assigning Lender or the assignee, as shall be agreed between
them), the Collateral 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 informa-tion
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, with-
out limitation, all or a portion of any or all of its Revolving
Credit Commitment 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 Revolving Credit 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
Collateral Agent, and the other Lenders shall continue to deal
solely and directly with such Lender in connec-tion with such
Lender's rights and obliga-tions under this Agree-ment and (iv)
such participant's rights to agree or to restrict such Lender's
ability to agree to the modi-fication, 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 respec-tive 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 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 not-with-standing, 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 pro-
posed 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 the
Borrower's Subsidiaries furnished to such Lender by the
Collateral Agent or by or on behalf of the Borrower or its
Subsidiaries; 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 con-fidential information described
therein.
15.02. Expenses.?? (a) Generally. The Borrower
agrees upon demand to pay, or reimburse the Collateral Agent for,
all of the Administrative Agents' and Collateral 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 environ-mental advisers, and other
consultants and agents) incurred by the Collateral Agent in
connection with (i) the Collateral Agent's review and investi-
gation of the Borrower and its Affiliates and the Collateral in
connection with the preparation, negotiation, and execution of
the Loan Documents and the Collateral Agent's periodic reviews
and audits of the Borrower and Guarantors; (ii) the pre-paration,
negotiation, execution and interpretation of this Agreement
(including, without limitation, the satisfac-tion or attempted
satis-faction of any of the conditions set forth in Article VI)
and the other Loan Docu-ments and the making of the Loans here-
under; (iii) the cre-ation, perfection or protec-tion of the
Liens under the Loan Documents (including, with-out limitation,
any reasonable fees and expenses for local counsel in various
jurisdic-tions); (iv) the ongoing administra-tion of this
Agreement, the other Loan Documents, and the Loans, including,
without limitation, consultation with attorneys in connection
there-with and with respect to the Collateral 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 the Borrower's 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 Collateral Agent is served or
deposition or other proceeding in which the Collateral Agent is
called to testify, in each case, relating in any way to the
Obligations, the Property, the Borrower, any of the Borrower's
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 Collateral 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 any of them after the occur-rence of an
Event of Default (i) in enforcing any Loan Document or Obligation
or any security therefor or exer-cising 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 inter-vening in any litigation
or in filing a petition, com-plaint, answer, motion or other
pleadings in any legal proceeding relat-ing to the Obligations,
the Property, the Borrower or any of the Borrower's 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 Collateral
Agent, each of the Administrative Agents, and each and all of the
Lenders and their Affiliates, the Issuing Banks, and each of the
foregoing's respective officers, direc-tors, trustees, employees,
attorneys and agents (including, without limita-tion, 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 what-soever
(excluding any taxes (except as provided in Section 14.01) and
including, with-out limitation, the fees and disbursements of
counsel for such Indemnitees in connection with any investiga-
tive, 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, 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, including, without limitation, the issuance of the
Senior Subordinated Notes, the Banner Exchange, the Banner
Distribution, and the acquisition of Kaynar pursuant to the
Kaynar Purchase Agreement, 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 "Indem-nified
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 negli-gence of such Indemnitee, as determined by a court of
competent jurisdiction and (b) not to assert any claim against
any of the Indemnitees on any theory of liability for special,
indirect, consequential or punitive damages arising out of, or in
any way in connection with, the Revolving Credit 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 Collateral
Agent, Administrative Agents, 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 prepara-tion 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 agree-ment of its
independent certified public accountants and such changes result
in a change in the method or result 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 such
accounting principles 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 prin-ciples.
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 con-
tinuance 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 con-nection with this Agreement,
irrespective of whether or not (i) such Lender or Issuing Bank
shall have made any demand hereunder or (ii) the Collateral
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, exer-cise its setoff rights hereunder against any
accounts of the Borrower, any of its Subsidiaries, or a 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 enforce-ment 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 propor-tion of the
aggregate amount of the Obliga-tions 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 inter-est
and participation (which it shall be deemed to have done
simultaneously upon the receipt of such payment) in such Obliga-
tions 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 purchas-ing 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 modi-fi-cation 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
Collateral 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 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 Revolving Credit
Commitments,
(ii) form of payment required with respect to or 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 prepay-ment thereof),
(iii) postponement or extension 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 (other than any
date fixed pursuant to Section 4.01(b)) 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 the Revolving Credit
Commitments, Term Loan Commitments, Term Loans, or Requisite
Lenders;
(vi) waiver of any of the conditions specified in Sections
6.01 or 6.02, the prohibition in Section 8.06 against
designation of any Subsidiary which is part of the Operating
Unit known as Fairchild Fasteners Group as an Unrestricted
Subsidiary, or the covenant set forth in Section 9.14,
(vii) release of any Guarantor or all or a substantial
portion of the Collateral (except as provided in Section
13.09(c)(i)(A) or (B) or in Section 13.09(c)(iii)),
(viii) change in the aggregate Term Loan Pro Rata Share and
Revolving Credit 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).
(c) Collateral Agent Authority. The Collateral Agent
may, but shall have no obligation to, with the written
concurrence of any Lender, exe-cute amendments, modifica-tions,
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 Collateral Agent under this Agreement or
the other Loan Documents, unless made in writing and signed by
the Collateral Agent in addition to the Lenders required above to
take such action; and the order of priority set forth in clauses
(i) and (ii) of Section 4.02(b) may be changed only with the
prior written consent of the Collateral 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
Collateral 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 Collateral Agent pursuant
to Articles II, IV or XIII shall not be effective until received
by the Collateral Agent. For the purposes hereof, the addresses
of the parties hereto (until notice of a change thereof is deliv-
ered 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 in
an amendment to this Agreement, or, (a) as to the Borrower, at
such other address as may be designated by the Borrower in a
written notice to all of the other parties to this Agreement and
(b) as to the Lenders and Issuing Banks, at such other address as
may be designated by such Person in a written notice to the
Collateral Agent.
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 Collateral 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
Cumula-tive.?? No failure or delay on the part of the Collateral
Agent, any Lender or any Issuing Bank in the exer-cise of any
power, right or privilege under any of the Loan Docu-ments 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 priv-ilege
preclude other or further exercise thereof or of any other right,
power or privi-lege. All rights and remedies exist-ing 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
Collateral Agent, any Lender or any Issuing Bank shall be under
any obliga-tion to marshall any assets in favor of the Borrower
or any other Person or against or in payment of any or all of the
Obliga-tions. To the extent that the Borrower makes a payment or
payments to the Collateral 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
fraudu-lent 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 there-for,
shall be revived and continued in full force and effect as if
such payment had not been made or such enforce-ment 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 substan-
tive 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, either
Administrative Agent, the Collateral Agent, or any other Person
against the Collateral Agent, an 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 con-
nection therewith; and the Borrower, each Lender, each Issuing
Bank, each Administrative Agent and the Collateral 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 as
provided in Section 15.07(b).
15.17. Certain Consents and Waivers.??
(a) Personal Jurisdiction. (i) EACH OF THE
ADMINISTRATIVE AGENTS, THE COLLATERAL 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. EACH OF THE ADMINISTRATIVE AGENTS,
THE COLLATERAL AGENT, THE LENDERS, THE ISSUING BANKS, AND THE
BORROWER AGREE 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 COLLATERAL AGENT
SHALL HAVE THE RIGHT TO PROCEED AGAINST IT OR ITS PROPERTY IN A
COURT IN ANY LOCATION TO ENABLE THE ADMINISTRATIVE AGENTS, THE
COLLATERAL AGENT, THE ISSUING BANKS, THE LENDERS AND OTHER
HOLDERS 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 AN ADMINISTRATIVE AGENT, THE COLLATERAL
AGENT, ANY ISSUING BANK, ANY LENDER OR OTHER HOLDER. THE
BORROWER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE
COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY AN ADMINISTRATIVE
AGENT, THE COLLATERAL AGENT, ANY LENDER, ANY ISSUING BANK OR
OTHER HOLDER TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY
FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER IN FAVOR OF AN ADMINISTRATIVE AGENT, THE COLLATERAL AGENT,
ANY LENDER, ANY ISSUING BANK OR ANY OTHER HOLDER. THE BORROWER
WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE
COURT IN WHICH AN ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, ANY
ISSUING BANK, LENDER OR OTHER HOLDER 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
BORROWER AT 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 COLLATERAL AGENT TO BRING
PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION.
(c) Waiver of Jury Trial. EACH OF THE ADMINISTRATIVE
AGENTS, COLLATERAL AGENT, LENDERS, ISSUING BANKS, AND 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, ADMINISTRATIVE AGENTS, COLLATERAL 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 supple-
ments 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, the Administrative
Agents and the Collateral 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 Agree-ment shall govern.
15.19. Limitation on Agreements.?? All agreements
between and among the Borrower, the Administrative Agents, the
Collateral 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 constitute "purpose credit" within the
meaning of Regulation U.
15.20. Confidentiality.?? Subject to Section
15.01(i), the Lenders and the Issuing Banks shall hold all
nonpublic information obtained pur-suant to the requirements of
this Agreement and iden-tified as such by the Borrower in
accordance with such Lender's or such Issuing Bank's cus-tomary
procedures for handling confidential informa-tion of this nature
and in accordance with safe and sound banking practices and in
any event may make disclosure (a) to its Affiliates or (b) as is
reasonably required by a bona fide offeree, transferee or
participant in connection with a contemplated assignment,
transfer or participation permitted under Section 15.01 or (c) as
required or requested by any Governmental Authority or
representative thereof or pursuant to legal process or (d) to any
direct or indirect contractual counterparties in swap agreements
or such contractual counterparties' professional advisors,
provided that such offeree, transferee, participant, contractual
counterparty or professional advisor to such contractual
counterparty is disclosed in writing to the Borrower and
Collateral Agent and agrees, in writing, to keep such
information confidential to the same extent required of the
Lenders hereunder. 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 or contractual counterparties and the Borrower or
Collateral Agent 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 under-standing among the parties hereto and
supersedes all prior agreements and under-standings, 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 Collateral Agent's
counsel represents only the Collateral 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 Collateral 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: THE FAIRCHILD CORPORATION
By Colin M. Cohen
Senior Vice President
Notice Address:
45025 Aviation Drive
Suite 400
Dulles, Virginia 20166-7516
Attn: Colin M. Cohen
Telecopier No. (703) 478-5767 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 AGENTS: CITICORP USA, INC., as Administrative
Agent
By Suzanne Crymes
Vice President
NATIONSBANK, N.A., as Administrative
Agent
By Michael R. Heredia
Senior Vice President
COLLATERAL AGENT: CITICORP USA, INC., as Collateral Agent
By Suzanne Crymes
Vice President
Notice Address:
Citicorp USA, Inc.
399 Park Avenue
6th Floor, Zone 4
New York, New York 10043
Attn: John W. Podkowsky
Telecopier No. (212) 793-1290
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 Suzanne Crymes
Vice President
Notice Address:
Citibank, N.A.
399 Park Avenue
6th Floor, Zone 4
New York, New York 10043
Attn: John W. Podkowsky
Telecopier No. (212) 793-1290
LENDER: CITICORP USA, INC.
By Suzanne Crymes
Vice President
Notice Address:
Citicorp USA, Inc.
399 Park Avenue
6th Floor, Zone 4
New York, New York 10043
Attn: John W. Podkowsky
Telecopier No. (212) 793-1290
Domestic Lending Office and Eurodollar
Lending Office or Eurodollar Affiliate:
Citicorp USA, Inc.
c/o Citibank, N.A.
2 Penn's Way
Suite 200
New Castle, Delaware 19720
Attn: Amy Goretzka
Telecopier No. (302) 894-6120
LENDER: NATIONSBANK, N.A.
By Michael R. Heredia
Senior Vice President
Notice Address
and Domestic and Eurodollar
Lending Office:
NationsBank, N.A.
6610 Rockledge Drive
6th Floor
Bethesda, Maryland 20817-1876
Attn: Michael R. Heredia
Telecopier No. (301) 571-0719
LENDER: CREDIT SUISSE FIRST BOSTON
By Bill O'Daly
Vice President
By Chris T. Horgan
Vice Presidnet
Notice Address, Domestic Lending Office
and Eurodollar Lending Office or Eurodollar
Affiliate:
Credit Suisse First Boston
11 Madison Avenue
New York, New York 10010
Attn: William O'Daly
Telecopier No. (212) 325-8314
LENDER: THE FIRST NATIONAL BANK OF CHICAGO
By Juan J. Duarte
Vice president
Notice Address:
The First National Bank of Chicago
153 West 51st Street
New York, New York 10019
Attn: Andrea S. Kantor
Telecopier No. (212) 373-1180
Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
The First National Bank of Chicago
1 First National Plaza
Chicago, Illinois 60670
Attn: Stevee Woods
Telecopier No.: (312) 732-4840
LENDER: MORGAN STANLEY DEAN WITTER PRIME INCOME
TRUST
By Peter Gewirtz
Athorized Signatory
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Morgan Stanley Dean Witter Prime Income
Trust
c/o Morgan Stanley Dean Witter Advisors,
Inc.
Two World Trade Center
72nd Floor
New York, New York 10048
Attn: Peter Gewirtz
Telecopier No. (212) 392-5345
LENDER: BOEING CAPITAL CORPORATION
By James C. Hammersmith
Senior Documentation Officer
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Boeing Capital Corporation
4060 Lakewood Blvd.
6th Floor
Long Beach, California 90808
Attn: April Wakeman
Telecopier No. (562) 627-3002
LENDER: NATEXIS BANQUE
By Peter J. vanTulder
President and Manager Multinational
Group
John Reid
Vice President
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Natexis Banque
645 Fifth Avenue
New York, New York 10022
Attn: Christine Dirringer
Telecopier No. (212) 872-5045
LENDER: RIGGS BANK N.A.
By Louanne Baily
Vice President
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Riggs Bank N.A.
808 17th Street, N.W.
Washington, D.C. 20005
Attn: Louanne Baily
Telecopier No. (202) 835-5977
LENDER: MERRILL LYNCH SENIOR FLOATING RATE FUND,
INC.
By Paul Travers
Authorized Signatory
Notice Address:
Merrill Lynch Senior Floating Rate Fund,
Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road, Area 1B
Plainsboro, New Jersey 08536
Attn: Colleen Cunniffe
Telecopier No. (609) 282-2756
Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Merrill Lynch Senior Floating Rate Fund,
Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road, Area 1B
Plainsboro, New Jersey 08536
Attn: Colleen Wade
Telecopier No.: (609) 282-3542
LENDER: MERRILL LYNCH SENIOR FLOATING RATE FUND II,
INC.
By Paul Travers
Authorized Signatory
Notice Address:
Merrill Lynch Senior Floating Rate Fund II,
Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road, Area 1B
Plainsboro, New Jersey 08536
Attn: Colleen Cunniffe
Telecopier No. (609) 282-2756
Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Merrill Lynch Senior Floating Rate Fund II,
Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road, Area 1B
Plainsboro, New Jersey 08536
Attn: Colleen Wade
Telecopier No.: (609) 282-3542
LENDER: CREDIT AGRICOLE INDOSUEZ
By Raymond A. Palkenberg
Vice President, Manager
By Ernest V. Hodge
Vice President
Senior Relationship Manager
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Credit Agricole Indosuez
55 East Monroe Street
Chicago, Illinois 60603
Attn: Richard Drennan
Telecopier No. (312) 372-9329
LENDER: COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE
By Sean Mounier
First Vice President
By Marcus Edward
Vice President
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Compagnie Financiere de CIC et de
l'Union Europeenne
520 Madison Avenue
37th Floor
New York, New York 10022
Attn: Brian O'Leary
Telecopier No. (212) 715-4535
LENDER: PROVIDENT BANK OF MARYLAND
By Robert L. Smith
Assistant Vice Presdient
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Provident Bank of Maryland
114 East Lexington Street
Baltimore, Maryland 21202
Attn: Robert L. Smith
Telecopier No. (410) 277-2291
LENDER: CRESCENT/MACH I PARTNERS, L.P.
By TCW Asset Management Company
Its Investment Manager
By Jonathan R. Insull
Vice Presdient
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Crescent/Mach I Partners, L.P.
c/o TCW Asset Management Company
200 Park Avenue
Suite 2200
New York, New York 10166-0228
Attn: Mark L. Gold/Justin Driscoll
Telecopier No.: (212) 771-4159
cc: Crescent/Mach I Partners, L.P.
c/o State Street Bank & Trust Co.
Two International Place
Boston, Massachusetts 02110
Attn: Elizabeth Kennedy
Telecopier No.: (617) 664-5368
LENDER: SEQUILS I, LTD
By TCW Advisors, Inc. as its
Collateral Manager
By Mark L. Gold
Managing Director
By Johnathan Insull
Vice President
Notice Address:
Sequils I, Ltd
c/o Trust Company of the West
200 Park Avenue
Suite 2200
New York, New York 10166
Attn: Mark L. Gold/Justin L. Driscoll/
Jonathan Insull
Telecopier No.: (212) 771-4159 or 4069
Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
Sequils I, Ltd
c/o Chase Bank of Texas, N.A.
Chase Tower, 9th Floor
Houston, Texas
Attn: Omar El-Aazami
Telecopier No. (713) 216-3571
LENDER: KZH CRESCENT LLC
By Virginia Conway
Authorized Agent
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
KZH Crescent LLC
c/o The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001
Attn: Virginia Conway
Telecopier No. (212) 946-7776
LENDER: KZH CRESCENT-2 LLC
By Virginia Conway
Authorized Agent
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
KZH Crescent-2 LLC
c/o The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001
Attn: Virginia Conway
Telecopier No. (212) 946-7776
LENDER: KZH CRESCENT-3 LLC
By Virginia Conway
Authorized Agent
Notice Address, Domestic Lending Office and
Eurodollar Lending Office or Eurodollar
Affiliate:
KZH Crescent-3 LLC
c/o The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001
Attn: Virginia Conway
Telecopier No. (212) 946-7776
LENDER: CITIBANK, N.A.
By Suzanne Crymes
Vice President
Notice Address:
Citicorp USA, Inc.
399 Park Avenue
6th Floor, Zone 4
New York, New York 10043
Attn: John W. Podkowsky
Telecopier No. (212) 793-1290
Domestic Lending Office and Eurodollar
Lending Office or Eurodollar Affiliate:
Citicorp USA, Inc.
c/o Citibank, N.A.
2 Penn's Way
Suite 200
New Castle, Delaware 19720
Attn: Amy Goretzka
Telecopier No. (302) 894-6120
EXHIBITS
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Forms of Notes
Exhibit C -- Form of Notice of Borrowing
Exhibit D -- Form of Notice of Conversion/Continuation
Exhibit E -- Pro Forma Balance Sheet
Exhibit F -- Projections
Exhibit G -- Statement of Sources and Uses
Exhibit H -- List of Closing Documents
Exhibit I -- Forms of Financial Reports
Exhibit J -- Form of Officer's Certificate to Accompany Reports
SCHEDULES
Schedule 1.01.1 -- Farmingdale Property
Schedule 1.01.2 -- Fiscal Quarter End Dates
Schedule 1.01.3 -- Subsidiary Guarantors as of the Closing
Date
Schedule 1.01.4 -- Operating Units
Schedule 1.01.5 -- Permitted Dispositions
Schedule 1.01.6 -- Permitted Equity Securities Options
Schedule 1.01.7 -- Permitted Existing Indebtedness
Schedule 1.01.8 -- Permitted Existing Investments
Schedule 1.01.9 -- Permitted Existing Liens
Schedule 1.01.10 -- Commitments
Schedule 3.02 -- Existing Letters of Credit
Schedule 6.01-J -- AlliedSignal Inc. Stock Subject to
Escrow or Reservation
Schedule 7.01-A -- Organizational Documents
Schedule 7.01-C -- Organizational Structure
Schedule 7.01-J -- Pending Actions
Schedule 7.01-Q -- Environmental Matters
Schedule 7.01-T -- Labor Contracts
Schedule 7.01-W -- Patent, Trademark & Permit Claims
Pending
Schedule 7.01-Y -- Insurance Policies
Schedule 10.02-G -- Foreign Receivables Discounting
Arrangements
Schedule 10.09 -- Permitted Sale/Leaseback Transactions
Schedule 10.14 -- Collection Accounts
::ODMA\PCDOCS\CHICAGO4\815372\12 September 23, 1999 (4:04PM)