CREDIT AGREEMENT
dated as of April 19, 1996
among
KENNAMETAL INC.,
As Borrower
and
DEUTSCHE BANK AG,
New York Branch and/or Cayman Islands Branch,
MELLON BANK, N.A.,
and
PNC BANK, NATIONAL ASSOCIATION,
as Lenders
Table of Contents
SECTION TITLE
ARTICLE I DEFINITIONS; CONSTRUCTION
1.01 Certain Definitions
1.02 Construction
1.03 Accounting Principles
1.04 Dollar Equivalent
ARTICLE II THE CREDITS
2.01 Revolving Credit Loans
2.02 Bid Loans
2.03 Making of Revolving Credit Loans
2.04 Interest Rates, Funding Periods; Amounts
2.05 Conversion or Renewal of Interest Rate Options
2.06 Repayments
2.07 Interest Payment Dates
2.08 Facility Fees
2.09 Pro Rata Treatment; Payments Generally
2.10 Additional Compensation in Certain Circumstances
2.11 Taxes
2.12 Funding by Branch, Subsidiary or Affiliate
2.13 Currency Equivalents
2.14 Lender's Sharing of Information
ARTICLE III REPRESENTATIONS AND WARRANTIES
3.01 Corporate Status
3.02 Corporate Power and Authorization
3.03 Execution and Biding Effect
3.04 Governmental Approvals and Filings
3.05 Absence of Conflicts
3.06 Audited Financial Statements
3.07 Interim Financial Statements
3.08 Absence of Undisclosed Liabilities
3.09 Absence of Material Adverse Changes
3.10 Subsidiaries and Other Investments
3.11 Accurate and Complete Disclosure
3.12 Margin Regulations
3.13 Litigation
3.14 Absence of Events of Default
3.15 Absence of Other Conflicts
3.16 Insurance
3.17 Title to Property
3.18 Intellectual Property
3.19 Taxes
3.20 Employee Benefits
3.21 Environmental Matters
3.22 Investment Company; Public Utility Holding
ARTICLE IV CONDITIONS OF LENDING
4.01 Conditions to Initial Loans
4.02 Conditions to All Loans
ARTICLE V AFFIRMATIVE COVENANTS
5.01 Basic Reporting Requirements
5.02 Insurance.
5.03 Payment of Taxes and Other Potential Charges and
Priority Claims
5.04 Preservation of Corporate Status
5.05 Governmental Approvals and Filings
5.06 Maintenance of Properties
5.07 Avoidance of Other Conflicts
5.08 Financial Accounting Practices
5.09 Use of Proceeds
5.10 Nature of Business
ARTICLE VI NEGATIVE COVENANTS
6.01 Financial Covenants
6.02 Liens
6.03 Guarantees, Indemnities, etc.
6.04 Mergers
6.05 Disposition of Accounts
6.06 Limitation on Other Restrictions or Dividends
by Subsidiaries, etc.
6.07 Limitation on Other Restrictions on Amendment
of the Loan Documents, etc.
ARTICLE VII DEFAULTS
7.01 Events of Default
7.02 Consequences of an Event of Default
ARTICLE VIII MISCELLANEOUS
8.01 Holidays
8.02 Records
8.03 Amendments and Waivers
8.04 No Implied Waiver; Cumulative Remedies
8.05 Notices
8.06 Expenses; Taxes; Indemnity
8.07 Severability
8.08 Prior Understandings
8.09 Duration; Survival
8.11 Limitation on Payments
8.12 Set-Off
8.14 Successors and Assigns; Participations; Assignments
8.15 Relationship Among the Lenders
8.16 Confidentiality
8.17 Governing Law; Submission to Jurisdiction: Waiver of Jury
Trial; Limitation of Liability
8.18 Judgment Currency
CREDIT AGREEMENT
THIS AGREEMENT, dated as of April 19, 1996, by and among
KENNAMETAL INC., a Pennsylvania corporation (the "Borrower"), and the lenders
parties hereto from time to time (the "Lenders", as defined further below).
Recital:
The Borrower has requested the Lenders to enter into this
Agreement and extend credit as provided for herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained and intending to be legally bound hereby, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
1.01. Certain Definitions. (a) In addition to other words and
terms defined elsewhere in this Agreement, the following terms are defined in
the Sections of this Agreement indicated below:
TERM SECTION
---- -------
Affected Lender 2.04 (d)
Base Rate 2.04 (a)
Base Rate Option 2.04 (a)
Bid Loans Maturity Date 2.02 (e)
Bid Loans Confirmation 2.02 (c)
Bid Rate 2.02 (b) (iii)
Contractual Currency 8.18 (a)
Cross Default Event 7.01 (f)
Cross Default Obligation 7.01 (f)
Euro-Rate Funding Period 2.04 (b)
Euro-Rate Option 2.04 (a) (ii)
Facility Fees 2.08
Funding Breakage Date 2.10 (b)
Funding Breakage Indemnity 2.10 (b)
GAAP 1.03
Governmental Action 3.04
Initial Revolving Credit
Committed Amount 2.01 (a)
Judgment Currency 8.18 (a)
Letter of Credit 6.03
Liquidation Currency 8.18 (b)
Notional Euro-Rate Funding Office 2.12 (a)
Participants 8.14 (b)
Permitted Liens 6.02
Purchasing Lenders 8.14 (c)
Related Litigation 8.17 (b)
Revolving Credit Commitment 2.01 (a)
Revolving Credit Committed Amount 2.01 (a)
Revolving Credit Loans 2.01 (a)
Transfer Lender Notes 8.14 (c) (iv)
(b) In addition to other words and terms defined elsewhere in
this Agreement, as used herein the following words and terms shall have the
following meanings, respectively, unless the context hereof otherwise clearly
requires:
"Affiliate" of a Person shall mean (a) any Person which directly
or indirectly controls, or is controlled by, or is under common control
with, such Person and (b) any director or officer (or, in the case of a
Person which is not a corporation, any individual having analogous
powers) of such Person or of a Person who is an Affiliate of such Person
within the meaning of the preceding clause (a). For purposes of the
preceding sentence, "control" of a Person means (i) the possession,
directly or indirectly, of the power to direct or cause the direction of
the management or policies of such Person, whether through the ownership
of voting securities, by contract or otherwise and (ii) in any case
shall include direct or indirect ownership (beneficially or of record)
of, or direct or indirect power to vote, 5% or more of the outstanding
shares of such Person (or in the case of a Person that is not a
corporation, 5% or more of any class of equity interest).
"Alternate Currencies" shall mean lawful currency of the Federal
Republic of Germany, Canada and the United Kingdom.
"Applicable Lending Office" shall mean, with respect to each
Lender, such Lender's Domestic Lending Office in the case of the Base
Rate Portion and such Bank's Eurocurrency Lending Office in the case of
the Euro-Rate Portion.
"Applicable Margin(s)" means for purposes of calculating (i) the
applicable interest margin for the Euro-Rate Portion of any Revolving
Credit Loan and (ii) the applicable rate of the Facility Fee for any
date for purposes of Section 2.08 hereof, that percent per annum as set
forth in the following table by reference to the column across from the
applicable Level of the Consolidated Funded Debt Ratio. For purposes
hereof the Level of the Consolidated Funded Debt Ratio shall be
determined as of the last day of each fiscal quarter of Borrower based
upon the computations set forth in the most recent Performance Pricing
Certificate delivered to and approved by the Lenders pursuant to Section
5.01(c) (ii) hereof, and the corresponding Applicable Margins may be
applied and effective as of the first Business Day of the month
following the date on which the most recent Performance Pricing
Certificate was required to be delivered (a "Pricing Effective
Date") to the Euro-Rate Portion of all then outstanding Loans and Loans
thereafter made, renewed or converted and to the Facility Fees accruing
from and after such Pricing Effective Date.
If a Performance Pricing Certificate is not received by the date
it is required to be delivered under Section 5.01 (c) (ii), without
limiting any other rights and remedies of the Lenders, the Applicable
Margin will be increased to that corresponding to Level IV from and as
of the next Pricing Effective Date to the day which is five days after
the date on which such Performance Pricing Certificate actually is
delivered. If the financial statements delivered pursuant to Section
5.01 (a) or 5.01 (b) demonstrate that the Level (and therefore the
Applicable Margin) is higher or lower than that indicated by the most
recent Performance Pricing Certificate, then such higher or lower Level
and Applicable Margin shall be deemed to have been in effect retroactive
to the immediately preceding Pricing Effective Date.
CONSOLIDATED EURO-RATE FACILITY FEE
FUNDED APPLICABLE APPLICABLE
DEBT RATIO MARGIN MARGIN
---------- ---------- ----------
Level I Equal to or less
than .75 to 1.00 .1250% .0750%
Level II Greater than .75
to 1.00 but less
than or equal to
1.25 to 1.00 .1500% .1000%
Level III Greater than 1.25
to 1.00 but less than
or equal to 2.25 to
1.00 .2250% .1250%
Level IV Greater than 2.25
to 1.00 .4000% .2500%
The "Applicable Margin(s)" for the period from the Closing Date to
the first Pricing Effective Date shall be those corresponding to Level
II.
"Base Rate Portion" of any Loan or Loans shall mean at any time
the portion, including the whole, of such Loan or Loans bearing interest
at such time (i) under the Base Rate Option or (ii) in accordance with
Section 2.09 (c) (ii)
hereof. If no Loan or Loans is specified, "Base Rate Portion" shall
refer to the Base Rate Portion of all Loans outstanding at such time.
"Bid Loan Borrowing" shall mean a borrowing consisting of a Bid
Loan or concurrent Bid Loans having the same Funding Period.
"Bid Loan" shall mean a Loan from a Lender to the Borrower
pursuant to the procedures described in Section 2.02.
"Bid Loan Notes" shall mean the promissory notes of the Borrower
executed and delivered under Section 2.02(k), and any promissory note
issued in substitution therefor pursuant to Section 8.14(c), together
with all extensions, renewals, refinancings or refundings thereof in
whole or in part.
"Business Day" shall mean any day other than a Saturday, Sunday,
public holiday under the laws of the Commonwealth of Pennsylvania or
other day on which banking institutions are authorized or obligated to
close in the cities in which the Lenders' Domestic Offices are located.
"Capital Expenditures" of any Person shall mean, for any period,
all expenditures (whether paid in cash or accrued as liabilities during
such period) of such Person during such period which would be classified
as capital expenditures in accordance with GAAP (including, without
limitation, expenditures for maintenance and repairs which are
capitalized, and Capitalized Leases to the extent an asset is recorded
in connection therewith in accordance with GAAP).
"Capitalized Lease" shall mean at any time any lease which is, or
is required under GAAP to be, capitalized on the balance sheet of the
lessee at such time, and "Capitalized Lease Obligation" of any Person at
any time shall mean the aggregate amount which is, or is required under
GAAP to be, reported as a liability on the balance sheet of such Person
under a Capitalized Lease.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, and any successor statute of
similar import, and regulations thereunder, in each case as in effect
from time to time.
"Change in Control" shall be deemed to have occurred if after the
date hereof, any Person or related group of Persons shall have come into
possession of, directly or indirectly, the power to direct or cause the
direction of or the power to veto (or shall in fact exercise any such
power) the management and policies of the Borrower through the ownership
or control of more than thirty percent (30%) of the voting securities of
the Borrower, whether through ownership of securities or partnership or
other ownership interest, by contract or otherwise.
"Closing Date" shall mean the date of the first Loan hereunder.
"Code" means the Internal Revenue Code of 1986, as amended, and
any successor statute of similar import, and regulations thereunder, in
each case as in effect from time to time. References to sections of the
Code shall be construed also to refer to any successor sections.
"Commitments" of a Lender shall mean the Lender's Revolving Credit
Commitment.
"Consolidated Funded Debt Ratio" means the ratio of (i) the
aggregate Indebtedness of the Borrower and its Consolidated Subsidiaries
as of the end of the fiscal quarter immediately prior to the date of
computation thereof, to (ii) Consolidated Operating Cash Flow for the
four fiscal quarters immediately prior to the date of the computation
thereof.
"Consolidated Interest Expense" for any period shall mean the
total interest expense of the Borrower and its Consolidated Subsidiaries
for such period determined on a consolidated basis in accordance with
GAAP.
"Consolidated Net Income" for any period shall mean the net
earnings (or loss) after taxes of the Borrower and its consolidated
Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.
"Consolidated Operating Cash Flow" for any period, with respect to
the Borrower and its Consolidated Subsidiaries shall mean the sum of (a)
Consolidated Net Income for such period, (b) Consolidated Interest
Expense for such period, (c) depreciation and amortization, (d) charges
for foreign, federal, state and local income taxes for such period, and
(e) extraordinary losses to the extent included in determining
Consolidated Net Income for such period, minus extraordinary gains to
the extent included in determining Consolidated Net Income for such
period, all as determined on a consolidated basis in accordance with
GAAP.
"Consolidated Subsidiary" shall mean those Subsidiaries whose
accounts are or should be consolidated with those of the Company in
accordance with GAAP.
"Consolidated Tangible Net Worth" at any time shall mean the total
amount of stockholders' equity of the Borrower and its Consolidated
Subsidiaries at such time determined on a consolidated basis in
accordance with GAAP, except that there shall be deducted therefrom (i)
treasury stock, (ii) preferred stock containing any provision for
mandatory cash redemption or cash redemption at the option of the holder
and (iii) the book value of all intangible assets of the Borrower and
its Consolidated Subsidiaries at such time determined on a consolidated
basis in accordance with GAAP, including but not limited to goodwill,
organization cost, patents, copyrights, trademarks, trade names,
franchises, licenses, research and development expenses, unamortized
debt discount and expense and further including but not limited to all
write-ups after the date hereof in the value of assets above historical
cost less depreciation or amortization required by GAAP, except for
write-ups in the value of (i) marketable securities to the extent
permitted by the valuation principle of "lower of cost or market" to the
extent permitted by GAAP, (ii) investments in common stock accounted for
by the equity method to the extent permitted by GAAP and (iii)
investment made in an enterprise doing business abroad resulting from
changes in exchange rates to the extent permitted by GAAP.
"Controlled Group Member" shall mean each trade or business
(whether or not incorporated) which together with the Borrower is
treated as a single employer under Section 4001 (a) (14) or 4001 (b) (1)
of ERISA or Section 414 (b), (c), (m) or (o) of the Code.
"Corresponding Source of Funds" shall mean, in the case of each
Lender's Pro Rata share of any Funding Segment of the Euro-Rate Portion,
the proceeds of hypothetical receipts by such Lender's Notional Euro-
Rate Funding Office or by such Lender through a Notional Euro-Rate
Funding Office of one or more deposits in Dollars or the Alternate
Currency, as the case may be, in the interbank eurocurrency market at
the beginning of the Euro-Rate Funding Period corresponding to such
Funding Segment having maturities approximately equal to such Euro-Rate
Funding Period and in an aggregate amount approximately equal to such
Lender's Pro Rata share of such Funding Segment.
"Dollar," "Dollars" and the symbol "$" shall mean lawful money of
the United States of America.
"Domestic Lending Office" means, with respect to each Lender, the
office of such Lender specified as its "Domestic Lending Office" below
its name on the signature page hereto, or such other office of such
Lender as such Lender may from time to time specify to the Borrower and
the other Lenders.
"Environmental Affiliate" shall mean, with respect to any Person,
any other Person whose liability (contingent or otherwise) for any
Environmental Claim such Person has retained, assumed or otherwise is
liable for (by Law, agreement or otherwise).
"Environmental Approvals" shall mean any Governmental Action
pursuant to or required under any Environmental Law.
"Environmental Claim" shall mean, with respect to any Person, any
action, suit, proceeding, investigation, notice, claim, complaint,
demand, request for information or other communication (written or oral)
by any other Person (including but not limited to any Governmental
Authority, citizens' group or present or former employee of such Person)
alleging, asserting or claiming any actual or potential (a) violation of
any Environmental Law, (b) liability under any Environmental Law or (c)
liability for investigatory costs, cleanup costs, governmental response
costs, natural resources damages, property damages, personal injuries,
fines or penalties arising out of, based on or resulting from the
presence, or release into the environment, of any Environmental Concern
Materials at any location, whether or not owned by such Person.
"Environmental Concern Materials" shall mean any flammable
substance, explosive, radioactive material, hazardous material,
hazardous waste, toxic substance, solid waste, pollutant, contaminant of
any related material, raw material, substance, product or by-product of
any substance regulated by any Environmental Law (including but not
limited to any "hazardous substance" as defined in CERCLA or any similar
state Law).
"Environmental Law" shall mean any Law, whether now existing or
subsequently enacted or amended, relating to (a) pollution or protection
of the environment, including natural resources, (b) exposure of
Persons, including but not limited to employees, to Environmental
Concern Materials, (c) protection of the public health or welfare from
the effects of products, by-products, wastes, emissions, discharges or
releases of Environmental Concern Materials or (d) regulation of the
manufacture, use or introduction into commerce of Environmental Concern
Materials including their manufacture, formulation, packaging, labeling,
distribution, transportation, handling, storage or disposal. Without
limitation, "Environmental Law" shall also include any Environmental
Approval and the terms and conditions thereof.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, and
regulations thereunder, in each case in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"Eurocurrency Lending Office" means, with respect to any Bank, the
Office of such Bank specified as its "Eurocurrency Lending Office" below
its name on the signature page hereto (or, if no such office is
specified, its Domestic Lending Office), or such other office of such
Lender as such Lender may from time to time specify to the Borrower and
the other Lenders.
"Euro-Rate" for any day shall mean for each Lender's Pro Rata
share of each Funding Segment of the Euro-Rate Portion corresponding to
a proposed or existing Euro-Rate Funding Period the rate per annum which
is the highest of the rates determined by each Lender by dividing (the
resulting quotient to be rounded upward to the nearest 1/100 of 1%) (a)
the rate of interest (which shall be the same for each day in such Euro-
Rate Funding Period) determined in good faith by such Lender in
accordance with its usual procedures (which determination shall be
conclusive absent manifest error) to be the average of the rates per
annum for deposits in Dollars or an Alternate Currency, as the case may
be, offered to major money center banks in the London Interbank market
at approximately 11:00 a.m., London time, two London Business Days prior
to the first day of such Euro-Rate Funding Period for delivery on the
first day of such Euro-Rate Funding Period in amounts comparable to such
Funding Segment and having maturities comparable to such Funding Period
by (b) a number equal to 1.00 minus the Euro-Rate Reserve Percentage.
If any Lender fails to provide a Euro-Rate upon request the highest of
the rates actually furnished by the Lenders shall be the "Euro-Rate".
"Euro-Rate Portion" of any Loan or Loans shall mean at any time
the portion, including the whole, of such Loan or Loans bearing interest
at any time under the Euro-Rate Option or at a rate calculated by
reference to the Euro-Rate under Section 2.09 (c) (i) hereof. If no
Loan or Loans is specified, "Euro-Rate Portion" shall refer to the Euro-
Rate Portion of all Loans outstanding at such time.
"Euro-Rate Reserve Percentage" for any day shall mean the
percentage (expressed as a decimal, rounded upward to the nearest 1/100
of 1%), as determined in good faith by a Lender (which determination
shall be conclusive absent manifest error), which is in effect on such
day as prescribed by the Board of Governors of the Federal Reserve
System (or any successor) representing the maximum reserve requirement
(including, without limitation, supplemental, marginal and emergency
reserve requirements) with respect to eurocurrency funding (currently
referred to as "Eurocurrency liabilities") of a member bank in such
System. The Euro-Rate shall be adjusted automatically as of the
effective date of each change in the Euro-Rate Reserve Percentage. The
Euro-Rate Option shall be calculated in accordance with the foregoing
whether or not such Lender is actually required to hold reserves in
connection with its eurocurrency funding or, if required to hold such
reserves, is required to hold reserves at the "Euro-Rate Reserve
Percentage" as herein defined.
"Event of Default" shall mean any of the Events of Default
described in Section 7.01 hereof.
"Existing Credit Agreement" shall mean the Credit Agreement dated
as of July 29, 1993 between the Borrower and Lenders, as amended.
"Federal Funds Effective Rate" for any day shall mean the rate per
annum (rounded upward to the nearest 1/100 of 1%) determined by each
Lender (which determination shall be conclusive absent manifest error)
to be the rate per annum announced by the Federal Reserve Bank of New
York (or any successor) on such day as being the weighted average of the
rates on overnight Federal funds transactions arranged by Federal funds
brokers on the previous trading day, as computed and announced by such
Federal Reserve Bank (or any successor) in substantially the same manner
as such Federal Reserve Bank computes and announces the weighted average
it refers to as the "Federal Funds Effective Rate" as of the date of
this Agreement; provided, that if such Federal Reserve Bank (or its
successor) does not announce such rate on any day, the "Federal Funds
Effective Rate" for such day shall be the Federal Funds Effective Rate
for the last day on which such rate was announced.
"Fees" shall mean the Facility Fees.
"Funding Period" shall mean the period during which an interest
rate Option or Bid Rate shall apply, selected in accordance with Section
2.04 or 2.02(j).
"Funding Segment" of the Euro-Rate Portion of the Loans at any
time shall mean the entire principal amount of such Portion to which at
the time in question there is applicable a particular Funding Period
beginning on a particular day and ending on a particular day.
"Governmental Authority" shall mean any government or political
subdivision or any agency, authority, bureau, central bank, commission,
department or instrumentality of either, or any court, tribunal, grand
jury or arbitrator, in each case whether foreign or domestic.
"Guaranty Equivalent": A Person (the "Deemed Guarantor") shall be
deemed to be subject to a Guaranty Equivalent in respect of any
Indebtedness (the "Assured Obligation") of another Person (the "Deemed
Obligor") if the Deemed Guarantor directly or indirectly guarantees,
becomes surety for, endorses, assumes, agrees to indemnify the Deemed
Obligor against, or otherwise agrees, becomes or remains liable
(contingently or otherwise) for, such Assured Obligation.
"Indebtedness" of a Person shall mean:
(a) All obligations on account of money borrowed by, or
credit extended to or on behalf of, or for or on account of
deposits with or advances to, such Person, other than trade
accounts payable incurred in the ordinary course of business and
consistent with past practice;
(b) All obligations of such Person evidenced by bonds,
debentures, notes or similar instruments;
(c) All obligations of such Person for the deferred
purchase price of property or services and all obligations secured
by a Lien on property owned by such Person (whether or not
assumed);
(d) All obligations of such Person under Capitalized Leases
(without regard to any limitation of the rights and remedies of the
holder of such Lien or the lessor under such Capitalized Lease to
repossession or sale of such property);
(e) From the date a letter of credit issuer makes payment
on a drawing under a letter of credit issued for the account of
such Person, such Person's obligation to reimburse such issuer for
such payment.
(f) All obligations of such Person in respect of
acceptances or similar obligations issued for the account of such
Person; and
(g) All obligations of such Person under a product
financing or similar arrangements described in paragraph 8 of FASB
Statement of Accounting Standards No. 49 or any similar requirement
of GAAP.
"Indemnified Parties" shall mean the Lenders, their respective
affiliates, and the directors, officers, employees, attorneys and agents
of each of the foregoing.
"Law" shall mean any law (including common law), constitution,
statute, treaty, convention, regulation, rule, ordinance, order,
injunction, writ, decree or award of any Governmental Authority.
"Lender" shall mean any of the Lenders listed on the signature
pages hereof and Persons becoming Lenders pursuant to Section 8.14
hereof, but excluding Persons who cease to be Lenders pursuant to
Section 8.14 hereof.
"Lien" shall mean any mortgage, deed of trust, pledge, lien,
security interest, charge or other encumbrance or security arrangement
of any nature whatsoever, including but not limited to any conditional
sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security.
"Loan" shall mean any loan (including Revolving Credit Loans and
Bid Loans) by a Lender to the Borrower under this Agreement, and "Loans"
shall mean all Loans made by the Lenders under this Agreement.
"Loan Documents" shall mean this Agreement, the Notes and Transfer
Supplements and all other agreements and instruments extending,
renewing, refinancing or refunding any indebtedness, obligation or
liability arising under any of the foregoing, in each case as the same
may be amended, modified or supplemented from time to time hereafter.
"London Business Day" shall mean a Business Day on which dealings
are carried on in the London interbank market and banks are open for
business in London.
"Material Adverse Effect" shall mean: (a) a material adverse
effect on the business, operations or condition (financial or otherwise)
of the Borrower and its Subsidiaries taken as a whole, (b) a material
adverse effect on the ability of the Borrower to perform or comply with
any of the terms and conditions of any Loan Document, or (c) a material
adverse effect on the legality, validity, binding effect, enforceability
or admissibility into evidence of any Loan Document, or the ability of
any Lender to enforce any material rights or remedies under or in
connection with any Loan Document (other than any such effects relating
to loan agreements generally and not to the Loan Documents in
particular).
"Maturity Date" shall mean March 31, 2001
"Multiemployer Plan" shall mean any employee benefit plan which is
a "multiemployer plan" within the meaning of Section 4001 (a) (3) of
ERISA and to which the Borrower or any Controlled Group Member has or
had an obligation to contribute.
"Note" or "Notes" shall mean the Revolving Credit Notes(s) or the
Bid Loan Note(s), as the case may be, of the Borrower executed and
delivered under this Agreement, together with all extensions, renewals,
refinancings or refundings of any thereof in whole or in part.
"Obligations" shall mean all indebtedness, obligations and
liabilities of the Borrower to any Lender from time to time arising
under or in connection with or related to or evidenced by this Agreement
or any other Loan Document, and all extensions, renewals or refinancings
thereof, whether such indebtedness, obligations or liabilities are
direct or indirect, otherwise secured or unsecured, joint or several,
absolute or contingent, due or to become due, whether for payment or
performance, now existing or hereafter arising. Without limitation of
the foregoing, such indebtedness, obligations and liabilities include
the principal amount of Loans, interest, Fees, indemnities or expenses
under or in connection with this Agreement or any other Loan Document,
and all extensions, renewals and refinancings thereof, whether or not
such Loans were made in compliance with the terms and conditions of this
Agreement or in excess of the obligation of the Lenders to lend.
Obligations shall remain Obligations notwithstanding any assignment or
transfer or any subsequent assignment or transfer of any of the
Obligations or any interest therein.
"Option" shall mean the Base Rate Option or the Euro-Rate Option,
as the case may be.
"Other Advances" means any loan or advance to Borrower made
pursuant to uncommitted lines of credit (or similar arrangements) with
any of PNC Bank, N.A., Mellon Bank, N.A. or Deutsche Bank and/or
commercial paper pass through vehicles utilized by PNC Bank, N.A.,
Mellon Bank, N.A. or Deutsche Bank.
"Payment Office" means, for Dollars, the Domestic Lending Office
of each Lender and, for the Alternate Currencies, the Eurocurrency
Lending Office of each Lender or such office of each Lender as shall
from time to time be selected by such Lender and notified by such Lender
to the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation established
under Title IV of ERISA or any other governmental agency, department or
instrumentality succeeding to the functions of said corporation.
"Pension-Related Event" shall mean any of the following events or
conditions:
(a) Any action is taken by any Person (i) to terminate, or
which would result in the termination of, a Plan either pursuant to
its terms or by operation of law (including, without limitation,
any amendment of a Plan which would result in a termination under
Section 4041 (e) of ERISA), or (ii) to have a trustee appointed for
a Plan pursuant to Section 4042 of ERISA;
(b) PBGC notifies any Person of its determination that an
event described in Section 4042 of ERISA has occurred with respect
to a Plan, that a Plan should be terminated, or that a trustee
should be appointed for a Plan;
(c) Any Reportable Event occurs with respect to a Plan;
(d) Any action occurs or is taken which could result in the
Borrower becoming subject to liability for a complete or partial
withdrawal by any Person from a Multiemployer Plan (including,
without limitation, seller liability incurred under Section 4204
(a) (2) of ERISA), or the Borrower or any Controlled Group Member
receives from any Person a notice or demand for payment on account
of any such alleged or asserted liability; or
(e) (i) There occurs any failure to meet the minimum funding
standard under Section 302 of ERISA or Section 412 of the Code with
respect to a Plan, or any tax return is filed showing any tax
payable under Section 4971 (a) of the Code with respect to any such
failure, or the Borrower of any Controlled Group Member receives a
notice of deficiency from the Internal Revenue Service with respect
to any alleged or asserted such failure, or (ii) any request is
made by any Person for a variance from the minimum funding
standard, or an extension of the period for amortizing unfunded
liabilities, with respect to a Plan.
"Performance Pricing Certificate" shall mean a certificate in
substantially the form of Exhibit C hereto, duly completed in a manner
satisfactory to the Lenders and executed by a Responsible Officer of the
Borrower.
"Person" shall mean an individual, corporation, partnership,
trust, unincorporated association, joint venture, joint-stock company,
Governmental Authority or any other entity.
"Plan" means any employee pension benefit plan within the meaning
of Section 3 (2) of ERISA (other than a Multiemployer Plan) covered by
Title IV of ERISA by reason of Section 4021 of ERISA, of which the
Borrower or any Controlled Group Member is or has been within the
preceding five years a "contributing sponsor" within the meaning of
Section 4001 (a) (13) of ERISA, or which is or has been within the
preceding five years maintained for employees of the Borrower or any
Controlled Group Member.
"Portion" shall mean the Base Rate Portion or the Euro-Rate
Portion, as the case may be.
"Potential Default" shall mean any event or condition which with
notice, passage of time or a determination by the Lenders pursuant to
Sections 7.01 (i), 7.01 (j) or 7.01 (k), or any combination of the
foregoing, would constitute an Event of Default.
"Pricing Effective Date" shall have the meaning set forth in the
definition of "Applicable Margin."
"Prime Rate" shall mean the interest rate per annum (calculated on
the basis of a year of 365 or 366 days, as the case may be, and actual
days elapsed) announced from time to time by Mellon Bank, N.A. as its
prime rate. The Prime Rate may be greater than or less than other
interest rates charged by Mellon Bank, N.A. to other borrowers and is
not solely based or dependent upon the interest rate which Mellon Bank,
N.A. may charge any particular borrower or class of borrowers.
"Pro Rata" shall mean from or to each Lender in proportion to: (i)
when used with reference to a particular type of Loan, the percentage
such Lender's outstanding Loans of such type represents of all
outstanding Loans of such type, or if no Loans of such type are
outstanding, the percentage such Lender's Commitment with respect to
such type of Loans represents of the Commitments of all Lenders with
respect to such type of Loans and (ii) when used with reference to all
Loans, the percentage such Lender's outstanding Loans represents of all
outstanding Loans, or if no Loans are outstanding, the percentage such
Lender's Commitments represents of Commitments of all Lenders.
"Quarterly Compliance Certificate" shall mean a certificate in
substantially the form of Exhibit D hereto, duly completed and executed
by a Responsible Officer of the Borrower.
"Regular Payment Date" shall mean the last day of each June,
September, December and March after the date hereof.
"Reportable Event" means (i) a reportable event described in
Section 4043 of ERISA and regulations thereunder for which the 30-day
notice to the PBGC has not been waived pursuant to such regulations,
(ii) a withdrawal by a substantial employer from a Plan to which more
than one employer contributes, as referred to in Section 4063 (b) of
ERISA, (iii) a cessation of operations at a facility causing more than
twenty percent (20%) of Plan participants to be separated from
employment, as referred to in Section 4068 (f) of ERISA, or (iv) a
failure to make a required installment or other payment with respect to
a Plan when due in accordance with Section 412 of the Code of Section
302 of ERISA which causes the total unpaid balance of missed
installments and payments (including unpaid interest) to exceed
$750,000.
"Responsible Officer" shall mean the President, Chief Financial
Officer, Treasurer or any Vice President of the Borrower.
"Revolving Credit Note" shall mean the promissory notes of the
Borrower executed and delivered under Section 2.01 (c) hereof, any
promissory note issued in substitution therefor pursuant to Sections
2.13 (b) or 8.14 (c) hereof, together with all extensions, renewals,
refinancings or refundings thereof in whole or part.
"Standard Notice" shall mean an irrevocable notice provided to
each Lender on a Business Day which is
(a) On the same Business Day in the case of selection of,
conversion to or renewal of the Base Rate Option or repayment of
any Base Rate Portion;
(b) At least two London Business Days in advance in the
case of selection of the Euro-Rate Option or repayment of any Euro-
Rate Portion denominated in Dollars; and
(c) At least three London Business Days in advance in the
case of selection of the Euro-Rate Option or repayment of any Euro-
Rate Portion denominated in the Alternate Currencies.
Standard Notice must be provided no later than 11:00 a.m., (or
10:00 a.m. in the case of clause (b) above) (at the Domestic Lending
Office of each Lender) on the last day permitted for such notice.
"Subsidiary" of a Person at any time shall mean any corporation of
which a majority (by number of shares or number of votes) of any class
of outstanding capital stock normally entitled to vote for the election
of one or more directors (regardless of any contingency which does or
may suspend or dilute the voting rights of such class) is at such time
owned directly or indirectly, beneficially or of record, by such Person
or one or more Subsidiaries of such Person, and any trust of which a
majority of the beneficial interest is at such time owned directly or
indirectly, beneficially or of record, by such Person or one or more
Subsidiaries or such Person.
"Taxes" shall have the meaning set forth in Section 2.11 hereof.
"Total Committed Amounts" shall mean the sum of the Revolving
Credit Committed Amounts of all Lenders.
"Transfer Effective Date" shall have the meaning set forth in the
applicable Transfer Supplement.
"Transfer Supplement" shall have the meaning set forth in Section
8.14 (c) hereof.
"Treasury Rate" as of any Funding Breakage Date shall mean the
rate per annum determined by the applicable Lender (which determination
shall be conclusive absent manifest error) to be the yield to maturity
(expressed as a decimal and, in the case of the United States Treasury
bills, converted to a bond equivalent yield) for United States Treasury
securities maturing on the last day of the corresponding Funding Period
and trading in the secondary market in reasonable volume (or if no such
securities mature on such date, the rate determined by standard
securities interpolation methods as applied to the series of securities
maturing as close as possible to, but earlier than, such date, and the
series of such securities maturing as close as possible to, but later
than, such date).
1.02. Construction. Unless the context of this Agreement
otherwise clearly requires, references to the plural include the singular, the
singular, the plural and the part the whole; "or" has the inclusive meaning
represented by the phrase "and/or"; and "property" includes all properties and
assets of any kind or nature, tangible or intangible, real, personal or mixed.
References in this Agreement to "determination" (and similar terms) by any
Lender include good faith estimates by such Lender (in the case of
quantitative determinations) and good faith beliefs by such Lender (in the
case of qualitative determinations). The words "hereof," "herein,"
"hereunder" and similar terms in this Agreement refer to this Agreement as a
whole and not to any particular provision of this Agreement. The section and
other headings contained in this Agreement and the Table of Contents preceding
this Agreement are for reference purposes only and shall not control or affect
the construction of this Agreement or the interpretation thereof in any
respect. Section, subsection and exhibit references are to this Agreement
unless otherwise specified.
1.03. Accounting Principles.
(a) As used herein, "GAAP" shall mean generally accepted
accounting principles in the United States (as such principles may change from
time to time), applied on a basis consistent with the principles used in
preparing the Borrower's financial statements as of June 30, 1995 and the
fiscal year then ended.
(b) Except as other provided in this Agreement, all computations
and determinations as to accounting or financial matters shall be made, and
all financial statements to be delivered pursuant to this Agreement shall be
prepared, in accordance with GAAP (including principles of consolidation where
appropriate), and all accounting or financial terms shall have the meanings
ascribed to such terms by GAAP.
1.04. Dollar Equivalent. For purposes of this Agreement, the
equivalent in Dollars of any Alternate Currency or the equivalent in any
Alternate Currency of Dollars shall be determined in accordance with Section
2.13.
ARTICLE II
THE CREDITS
2.01 Revolving Credit Loans.
(a) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender, severally and
not jointly, agrees (such agreement being herein called such Lender's
"Revolving Credit Commitment") to make loans ("Revolving Credit Loans") to the
Borrower at any time or from time to time on or after the date hereof and to
but not including the Maturity Date; provided (A) at no time shall the sum of
the outstanding aggregate principal amount of all Revolving Credit Loans and
Bid Loans exceed the Total Committed Amount (or an equivalent amount thereof
in the Alternate Currencies) and (B) at all times the outstanding aggregate
principal amount of all Revolving Credit Loans made by each Lender shall be
equal to the product of the percentage which its Revolving Credit Committed
Amount represents of the Total Committed Amount times the outstanding
aggregate principal amount of all Revolving Credit Loans. Each Lender's
"Revolving Credit Committed Amount" at any time shall be equal to the amount
set forth as its "Initial Revolving Credit Committed Amount" below its name on
the signature pages hereof (or the equivalent thereof in any Alternate
Currency), as such amount may have been reduced under Section 2.01 (e) hereof
at such time, and subject to transfer to another Lender as provided in Section
8.14 hereof.
(b) Nature of Credit. Within the limits of time and amount set
forth in this Section 2.01, and subject to the provisions of this Agreement,
the Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder.
(c) Revolving Credit Notes. The obligation of the Borrower to
repay the unpaid principal amount of the Revolving Credit Loans made to it by
each Lender and to pay interest thereon shall be evidenced in part by
promissory notes of the Borrower, dated the Closing Date (the "Revolving
Credit Notes") in substantially the form attached hereto as Exhibit A, with
the blanks appropriately filled, payable to the order of such Lender.
(d) Maturity. To the extent not due and payable earlier, the
Revolving Credit Loans shall be due and payable on the Maturity Date.
(e) Reduction of the Revolving Credit Committed Amounts. The
Borrower may at any time or from time to time reduce Pro Rata the Revolving
Credit Committed Amounts of the Lenders to an aggregate amount (which may be
zero) not less than the sum of the unpaid principal amount of the Revolving
Credit Loans and the Bid Loans, as the case may be, then outstanding plus the
principal amount of all Revolving Credit Loans and the Bid Loans, as the case
may be, not yet made as to which notice has been given by the Borrower under
Section 2.03 or 2.02 hereof. Any reduction of the Revolving Credit Committed
Amounts shall be in an aggregate amount which is an integral multiple of
$3,000,000. Reduction of the Revolving Credit Committed Amounts shall be made
by providing not less than three Business Days' notice (which notice shall be
irrevocable) to such effect to each Lender.
2.02. Bid Loans.
(a) Bid Loans. The Borrower may, as set forth in this Section
2.02, request one or more of the Lenders to make one or more Bid Loans to the
Borrower at any time or from time to time prior to the Maturity Date. Each
Lender may, but shall have no obligation to, offer to make one or more such
Bid Loans and the Borrower may, but shall have no obligation to, accept any
such offers in the manner set forth in this Section 2.02. The sum of the
outstanding aggregate principal amount of all Bid Loans and all Revolving
Credit Loans shall at no time exceed the Total Committed Amount (or an
equivalent amount thereof in the Alternate Currencies). All Bid Loans shall
be denominated in Dollars.
(b) Bid Loan Procedures. Prior to 11:00 a.m., Pittsburgh time,
on the Business Day of any Bid Loan, the Borrower and the Lender making such
Bid Loan shall have verbally agreed that such Lender will make and the
Borrower will accept such Bid Loan, which agreement shall include agreement as
to the following matters:
(i) the proposed date of such Bid Loan and the Funding
Period therefor;
(ii) the principal amount of such Bid Loan, selected in
accordance with Section 2.02(a); and
(iii) the fixed rate of interest per annum, calculated on
the basis of a 365 or 366 day year, as the case may be,(rounded upwards,
if necessary, to the nearest 1/10,000th of 1%) (the "Bid Rate")
applicable to such Bid Loan.
(c) Confirmation to the Lenders. The Borrower shall, by 11:30
a.m., Pittsburgh time, on the day (which shall be a Business Day) of a
proposed Bid Loan, deliver to each Lender, by telex or telecopy, confirmation
of the Bid Loans it has agreed to accept and that any Lender or Lenders have
agreed to make on such day in substantially the form of Exhibit E (a "Bid Loan
Confirmation"). The Bid Loan Confirmation shall specify (i) the principal
amount of each outstanding and pending Loan, including such Bid Loan(s) being
made; (ii) the Funding Period for each outstanding and pending Loan, including
such Bid Loan(s) being made; (iii) the interest rate applicable to each
outstanding and pending Loan, including such Bid Loan(s) being made; (iv) the
identity of the Lender for each outstanding and pending Loan, including such
Bid Loan(s) being made and (v) the principal amount of each outstanding and
pending Other Advance, together with the principal amount, and maturity date
thereof, the interest applicable thereto and the identity of the lender
thereof.
(d) Funding of Bid Loans. Not later than 3:00 p.m. Pittsburgh
time, on the date agreed to by the Borrower and a Lender pursuant to Section
2.02 (b), such Lender shall make the amount of its Bid Loan available to the
Borrower in immediately available funds at the Borrower's Account No.127-1718
at Mellon Bank, N.A. or such other Borrower account as may be designated in
the Bid Loan Confirmation. If any Lender makes a new Bid Loan hereunder on a
day on which the Borrower is to repay all or any part of an outstanding Bid
Loan from such Lender, such Lender shall apply the proceeds of its new Bid
Loan to make such repayment and only an amount equal to the difference (if
any) between the amount being borrowed and the amount being repaid shall be
made available by such Lender to the Borrower as provided by this Section 2.02
(d), or remitted by the Borrower to such Lender as provided in Section 2.09,
as the case may be.
(e) Bid Loan Maturity Dates. The principal amount of each Bid
Loan shall be due and payable on the last day of the applicable Funding Period
agreed to by the Borrower and the Lender making such Bid Loan (the "Bid Loan
Maturity Date"). Bid Loans shall not be prepaid.
(f) Bid Loan Interest Payment Dates. Interest on each Bid Loan
shall be due and payable on the Bid Loan Maturity Date thereof and thereafter
on demand at the rates provided for in Section 2.09 (c).
(g) Utilization of Revolving Credit Commitment. For purposes of
determining the available Revolving Credit Commitments of the Lenders at any
time , each outstanding Bid Loan shall be deemed to have utilized the
Revolving Credit Commitments of the Lenders (including those Lenders that have
not made such Bid Loan) Pro Rata in accordance with their Revolving Credit
Commitments.
(h) Interest Rates for Bid Loans. The outstanding principal
amount of each Bid Loan shall bear interest for each day until due at a rate
per annum equal to the Bid Rate quoted by the Lender making such Bid Loan.
(i) Principal Amounts. The aggregate principal amount of each
Bid Loan shall be at least $1,000,000 or a higher integral multiple of
$100,000.
(j) Funding Periods. The Funding Period for any Bid Loan shall
be for any period up to and including 90 days; provided, (i) no such Funding
Period shall end after the Maturity Date and (ii) the Borrower shall, in
selecting such Funding Periods, allow for foreseeable mandatory repayments of
the Loans.
(k) Bid Loan Notes. The obligation of the Borrower to repay the
unpaid principal amount of the Bid Loans made to it by each Lender and to pay
interest thereon shall be evidenced in part by promissory notes of the
Borrower, dated of even date herewith substantially the form attached hereto
as Exhibit B, payable to the order of such Lender.
2.03. Making of Revolving Credit Loans. Whenever the Borrower
desires that the Lenders make Revolving Credit Loans, the Borrower shall
provide Standard Notice to each Lender setting forth the following
information.
(a) The date, which shall be a Business Day, on which such
proposed Loans are to be made and the amount of each Lender's Loan;
(b) Whether such Loans shall be denominated in Dollars or an
Alternate Currency;
(c) The aggregate principal amount of such proposed Loans, which
shall be the sum of the principal amounts selected pursuant to clause
(e) of this Section 2.03, and which shall be an integral multiple of
$100,000 (or the equivalent thereof in an Alternate Currency) not less
than $1,000,000 (or the equivalent thereof in an Alternate Currency);
(d) The interest rate Option or Options selected in accordance
with Section 2.04 (a) hereof and the principal amounts selected in
accordance with Section 2.04 (c) hereof of the Base Rate Portion and
each Funding Segment of the Euro-Rate Portion of such proposed Loans;
(e) With respect to each such Funding Segment of such proposed
Loans, the Funding Period to apply to such Funding Segment, selected in
accordance with Section 2.04 (b) hereof and
(f) A summary of all then outstanding and pending Loans and Other
Advances, including the amounts thereof, the identity of the lender or
lenders making or to make such Loans or Other Advances, the currency in
which such Loans or Other Advances were made or are to be made and the
Funding Period or maturity dates thereof.
Unless any applicable condition specified in Article IV hereof has not been
satisfied, on the date specified in such Standard Notice each Lender shall
make the proceeds of its Revolving Credit Loans available to the Borrower in
immediately available funds at the Borrower's Account No. 127-1718 at Mellon
Bank, N.A. or such other Borrower account as may be designated in such
Standard Notice at such Lender's Applicable Lending Office, no later than
3:00 p.m., Pittsburgh time, in funds immediately available at such Office.
2.04. Interest Rates, Funding Periods, and Amounts.
(a) Optional Bases of Borrowing. The unpaid principal amount of
the Loans shall bear interest for each day until due on one or more bases
selected by the Borrower from among the interest rate Options set forth below.
Subject to the provisions of this Agreement the Borrower may select different
Options to apply simultaneously to different Portions of the Loans and may
select different Funding Segments to apply simultaneously to different parts
of the Euro-Rate Portion of the Loans. The aggregate number of Funding
Segments applicable to the Euro-Rate Portion of the Revolving Credit Loans at
any time shall not exceed five. The Base Rate Option shall only be available
with respect to Loans denominated in Dollars.
(i) Base Rate Option: A rate per annum for each day (computed on
the basis of a year of 365 or 366 days and actual days elapsed) equal to
the Base Rate for such day. The "Base Rate" for any day shall mean the
greater of (a) the Prime Rate for such day and (b) 0.25% plus the
Federal Funds Effective Rate for such day such interest rate to change
automatically from time to time effective as of the effective date of
each change in the Prime Rate or the Federal Funds Effective Rate. If
on any date the Federal Funds Rate cannot be ascertained, then the Base
Rate shall be determined on the basis of the Prime Rate.
(ii) Euro-Rate Option: A rate per annum (based on a year of 360
days and actual days elapsed) for each day equal to the Euro-Rate for
such day plus the Applicable Margin for such day.
(iii) Notification: Each Lender shall, upon request, give prompt
notice to the Borrower of the Euro-Rate determined or adjusted in
accordance with the definitions of the Euro-Rate, which determination or
adjustment shall be conclusive if made in good faith. The Borrower
shall give written notice to the Lenders setting forth the rate quoted
by each Lender, and designating the highest thereof as the Euro-Rate,
promptly upon determining such Euro-Rate, and in no event later than
3:00 p.m. on the day Standard Notice with respect to such Loan is given.
(b) Funding Periods. At any time when the Borrower shall select,
convert to or renew the Euro-Rate Option to apply to any part of
the Loans, the Borrower shall specify one or more Funding Periods
during which each such Option shall apply. Such Funding Periods
shall be for one week and one, two, three or six months for
Revolving Credit Loans ("Euro-Rate Funding Period"), provided that:
(i) Each Euro-Rate Funding Period shall begin on a London
Business Day, and the term "month", when used in connection with a Euro-
Rate Funding Period, shall be construed in accordance with prevailing
practices in the interbank eurocurrency market at the commencement of
such Euro-Rate Funding Period, as determined in good faith by each
Lender (which determination shall be conclusive absent manifest error);
(ii) The Borrower may not select a Funding Period that would end
after the Maturity Date; and
(iii) The Borrower shall, in selecting any Funding Period for the
Loans, allow for foreseeable mandatory repayments of the Loans.
(c) Transactional Amounts. Every selection of, conversion from,
conversion to or renewal of an interest rate Option and every payment or
repayment of any Loans shall be in a principal amount such that after giving
effect thereto the aggregate principal amount of the Base Rate Portion of the
Revolving Credit Loans, or the aggregate principal amount of each Funding
Segment of the Euro-Rate Portion of the Revolving Credit Loans, shall be as
set forth below:
PORTION OR FUNDING SEGMENT ALLOWABLE AGGREGATE PRINCIPAL AMOUNTS
- -------------------------- -------------------------------------
Base Rate Portion Any;
Each Funding Segment of the
Euro-Rate Portion $1,000,000 or an integral multiple of
$100,000 in excess of $1,000,000.
(d) Euro-Rate Unascertainable; Impracticability. If
(i) on any date on which a Euro-Rate would otherwise be set any
Lender shall have determined in good faith (which determination shall be
conclusive absent manifest error) that:
(A) adequate and reasonable means do not exist for
ascertaining such Euro-Rate,
(B) a contingency has occurred which materially and
adversely affects the interbank eurocurrency market, or
(C) the effective cost to such Lender of funding a proposed
Funding Segment of the Euro-Rate Portion from a Corresponding
Source of Funds shall exceed the Euro-Rate applicable to such
Funding Segment, or
(ii) at any time any Lender shall have determined in good faith
(which determination shall be conclusive absent manifest error) that the
making, maintenance or funding of any part of the Euro-Rate Portion in
Dollars or any Alternate Currency has been made impracticable, or
unlawful by compliance by such Lender or a Notional Euro-Rate Funding
Office in good faith with any Law or guideline or interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof or with any request or
directive or any such Governmental Authority (whether or not having the
force of law);
then, and in any such event, such Lender may notify the Borrower
and the other Lenders of such determination. Upon such date as shall be
specified in such notice (which shall not be earlier than the date such notice
is given), the obligation of such Lender to allow the Borrower to select,
convert to or renew the Euro-Rate Option or to make Loans or redenominate
Loans in Dollars or any Alternate Currency (whichever event has given rise to
an event described in clause (i) or (ii) above) shall be suspended until such
Lender shall have later notified the Borrower and the other Lenders of such
Lender's determination in good faith (which determination shall be conclusive
absent manifest error) that the circumstances giving rise to such previous
determination no longer exist.
If any Lender notifies the Borrower of a determination under
subsection (ii) of this Section 2.04 (d), the Euro-Rate Portion of the Loans
of such Lender (the "Affected Lender") shall automatically be converted to the
Base Rate Option as of the date specified in such notice (and accrued interest
thereon shall be due and payable on such date).
If at the time a Lender makes a determination under subsection (i)
or (ii) of this Section 2.04 (d) the Borrower previously has notified the
Lenders that it wishes to select, convert to or renew the Euro-Rate Option
with respect to any proposed Loans but such Loans have not yet been made, such
notification shall be deemed to provide for selection of, conversion to or
renewal of the Base Rate Option instead of the Euro-Rate Option with respect
to such Loans of such Lender.
2.05. Conversion or Renewal of Interest Rate Options.
(a) Conversion or Renewal of Dollar Loans. Subject to the
provisions of Section 2.04 and 2.10 (b) hereof, and if no Event of Default or
Potential Default shall have occurred and be continuing or shall exist, the
Borrower may (i) convert any interest rate Option or Options applicable to
Loans denominated in a particular currency to one or more different interest
rate Options applicable to Loans denominated in the same currency and (ii) may
renew the Euro-Rate Option as to any Funding Segment of the Euro-Rate Portion
denominated in the same currency:
(i) At any time with respect to conversion from the Base Rate
Option; or
(ii) At the expiration of any Funding Period with respect to
conversions from or renewals of the Euro-Rate Option as to the Funding
Segment corresponding to such expiring Funding Period.
(b) Conversion of Currency. Subject to the provisions of
Sections 2.04 and 2.10 hereof, and if no Event of Default or Potential Default
shall have occurred and be continuing or shall exist, the Borrower may convert
any Loans denominated in Dollars bearing interest under any interest rate
Option to Loans denominated in an Alternate Currency bearing interest under
the Euro-Rate Option, and may convert any Loans denominated in an Alternate
Currency bearing interest at the Euro-Rate Option to Loans denominated in
Dollars bearing interest at any interest rate Option; provided that any such
conversion relating to any Funding Segment of the Euro-Rate Portion may only
occur on the last day of the corresponding Funding Period.
(c) Procedures. Whenever the Borrower desires to convert or
renew any interest rate Option or Options or currency, the Borrower shall
provide to each Lender Standard Notice setting forth the following
information:
(i) The date, which shall be a Business Day, on which the
proposed conversion or renewal is to be made;
(ii) The proposed currency conversion, if any;
(iii) The principal amounts selected in accordance with Section
2.04 (c) hereof of the Base Rate Portion and each Funding Segment of the
Euro-Rate Portion to be converted from or renewed;
(iv) The interest rate Option or Options selected in accordance
with Section 2.04 (a) hereof and the principal amounts selected in
accordance with Section 2.04 (c) hereof of the Base Rate Portion and
each Funding Segment of the Euro-Rate Portion to be converted to; and
(v) With respect to each Funding Segment to be converted to or
renewed, the Funding Period selected in accordance with Section 2.04 (b)
hereof to apply to such Funding Segment.
Standard Notice having been so provided, after the date specified in such
Standard Notice, interest shall be calculated upon the principal amount of the
Loans as so converted or renewed. Interest on the principal amount of any
part of the Loans converted or renewed (automatically or otherwise) shall be
due and payable on the conversion or renewal date.
(d) Failure to Convert or Renew. Absent due notice from the
Borrower of conversion or renewal on the last day of any Funding Period, any
part of the Euro-Rate Portion for which such notice is not received shall be
converted automatically to a Loan denominated in Dollars bearing interest at
the Base Rate Option on the last day of the expiring Funding Period.
2.06. Repayments. (a) Generally. Wherever the Borrower desires
or is required to repay any part of its Loans, it shall provide Standard
Notice to each Lender setting forth the following information:
(i) Whether such repayment is to be applied to the Revolving
Credit Loans or Bid Loans;
(ii) The date, which shall be a Business Day, on which the
proposed repayment is to be made;
(iii) The total principal amount of such repayment, which shall
be the sum of the principal amounts selected pursuant to clause (iv) of
this Section 2.06 and
(iv) The principal amounts selected in accordance with Section
2.04 (c) hereof of the Base Rate Portion and each part of each Funding
Segment of the Euro-Rate Portion and the principal amount selected in
accordance with Section 2.02 (i) hereof of Bid Loans (identified by
reference to their Funding Period).
Standard Notice having been so provided, on the date specified in such
Standard Notice, the principal amounts of the Base Rate Portion and each part
of the Euro-Rate Portion specified in such notice, together with interest on
each such principal amount to such date, shall be due and payable.
(b) Optional Repayments. The Borrower shall have the right at
its option from time to time to repay its Revolving Credit Loans in whole or
part without premium or penalty (subject, however, to Section 2.10 (b)
hereof):
(i) At any time with respect to any part of the Base Rate
Portion; or
(ii) At the expiration of any Funding Period with respect to
repayment of any Bid Loan, or the Euro-Rate Portion with respect to any
part of the Funding Segment corresponding to such expiring Funding
Period.
Any such repayment shall be made in accordance with Section 2.09 hereof.
(c) Mandatory Repayments Required as a Result of Currency
Fluctuations.
If on the last day of any Euro-Rate Funding Period for any Funding
Segment of the Revolving Credit Loans, that is denominated in an Alternate
Currency, the equivalent in Dollars of the aggregate principal amount of the
Loans then outstanding exceeds 105% of the Total Committed Amounts, the
Borrower shall on such last day repay an aggregate principal amount of such
type of Loans so that after such repayment, the Dollar equivalent of the
outstanding principal amount of the Loans shall not exceed the Total Committed
Amounts.
2.07. Interest Payment Dates. Interest on the Base Rate Portion
shall be due and payable on each Regular Payment Date. Interest on each
Funding Segment of the Euro-Rate Portion shall be due and payable on the last
day of the corresponding Euro-Rate Funding Period , as the case may be, and,
if a Euro-Rate Funding Period is longer than three months, also every third
month during such Funding Period. After maturity of any part of the Loans (by
acceleration or otherwise), interest on such part of the Loans shall be due
and payable on demand.
2.08 Facility Fees. The Borrower shall pay to each Lender a
facility fee (the "Facility Fee") equal to the Applicable Margin relating to
the Facility Fee per annum (based on a year of 365 or 366 days, as the case
may be, and actual days elapsed) for each day from and including the date of
this Agreement to but not including the Maturity Date, on the amount (not less
than zero) equal to such Lender's Revolving Credit Committed Amount on such
day. Such Facility Fee shall be due and payable for the preceding period for
which such fee has not been paid: (i) on each Regular Payment Date, and (ii)
on the Maturity Date.
2.09. Pro Rata Treatment; Payments Generally.
(a) Pro Rata Treatment. Each borrowing of Revolving Credit Loans
and each conversion and renewal of interest rate Options hereunder shall be
made, and all payments made in respect of principal of and interest on
Revolving Credit Loans and Fees due from the Borrower hereunder or under the
Revolving Credit Notes shall be applied, Pro Rata from and to each Lender, as
the case may be, except for payments of interest involving an Affected Lender
as provided in Section 2.04 (d) hereof and payments to a Lender subject to a
withholding deduction under Section 2.11 (c) hereof. All payments made in
respect of principal of any Bid Loan Borrowing due from the Borrower hereunder
or under the Bid Loan Notes shall be made to each Lender participating in such
Bid Loan Borrowing in proportion to the respective principal amounts of their
outstanding Bid Loans comprising such Bid Loan Borrowing. All payments made
in respect of interest on any Bid Loan Borrowing due from the Borrower
hereunder or under the Bid Loan Notes shall be made to each Lender
participating in such Bid Loan Borrowing in proportion to the respective
amounts of accrued and unpaid interest on their Bid Loans comprising such Bid
Loan Borrowing, except for payments to a Lender subject to a withholding
deduction under Section 2.11 (c) hereof. The failure of any Lender to make a
Loan shall not relieve any other Lender of its obligation to lend hereunder;
no Lender shall be responsible for the failure of any other Lender to make a
Loan.
(b) Payments Generally. All payments and repayments to be made
by the Borrower in respect of principal, interest, Fees, indemnity, expenses
or other amounts due from the Borrower hereunder or under any Loan Document
shall be payable to each Lender in Dollars (or in the case of interest and
principal of Loans denominated in an Alternate Currency, in such Alternate
Currency) at 3:00 o'clock p.m. (at the relevant Payment Office of such Lender)
at its Payment Office in funds immediately available at such Payment Office.
All such payments shall be made on the day when due without presentment,
demand, protest or notice of any kind, all of which are hereby expressly
waived, and an action therefor shall immediately accrue, without setoff,
counterclaim, withholding or other deduction of any kind or nature, except for
payments to a Lender subject to a withholding deduction under Section 2.11 (c)
hereof. Any payment or repayment received by such Lender after 3:00 o'clock
p.m. (at such Lender's Payment Office), on any day shall be deemed to have
been received on the next succeeding Business Day.
(c) Interest on Overdue Amounts. To the extent permitted by Law,
after there shall have become due (by acceleration or otherwise) principal,
interest, Fees, indemnity, expenses or any other amounts due from the Borrower
hereunder or under any Loan Document, such amounts shall bear interest for
each day until paid (before and after judgment), payable on demand, at a rate
per annum which for each day shall be equal to the following:
(i) In the case of any part of the Euro-Rate Portion of any Loans
or any Bid Loan, (A) until the end of the applicable then-current
Funding Period at a rate per annum 2% above the rate otherwise
applicable to such part, and (B) thereafter in accordance with the
following clause ; and
(ii) In the case of any other amount due from the Borrower
hereunder or under any Loan Document, 2% above the then-current Base
Rate Option.
To the extent permitted by Law, interest accrued on any amount
which has become due hereunder or under any Loan Document shall compound on a
day-by-day basis, and hence shall be added daily to the overdue amount to
which such interest relates.
2.10. Additional Compensation in Certain Circumstances.
(a) Increased Costs or Reduced Return Resulting From Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc. If any Law or
guideline or interpretation or application thereof by any Governmental
Authority charged with the interpretation or administration thereof or
compliance with any request or directive of any Governmental Authority
(whether or not having the force of law) now existing or hereafter adopted:
(i) subjects any Lender or any Notional Euro-Rate Funding Office
to any tax or changes the basis of taxation with respect to this
Agreement, the Notes, the Loans or payments by the Borrower of
principal, interest, or other amounts due from the Borrower hereunder or
under the Notes (except for taxes on the overall net income or overall
gross receipts of such Lender or such Notional Euro-Rate Funding Office
imposed by the jurisdictions (federal, state and local) in which such
Lender's principal office or Notional Euro-Rate Funding Office is
located),
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against credits or commitments to extend
credit, credit extended by, assets (funded or contingent) of, deposits
with or for the account of, other acquisitions of funds by, such Lender
or any Notional Euro-Rate Funding Office (other than requirements
expressly included herein in the determination of the Euro-Rate
hereunder),
(iii) imposes, modifies or deems applicable any capital adequacy
or similar requirement (A) against assets (funded or contingent) of, or
credits or commitments to extend credit, credit extended by, any Lender
or any Notional Euro-Rate Funding Office, or (B) otherwise applicable to
the obligations of any Lender or any Notional Euro-Rate Funding Office
under this Agreement, or
(iv) imposes upon any Lender or any Notional Euro-Rate Funding
Office any other condition or expense with respect to this Agreement,
the Notes or its making, maintenance or funding of any Loan,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon
any Lender, any Notional Euro-Rate Funding Office or, in the case of clause
(iii) hereof, any Person controlling a Lender, with respect to this Agreement,
the Notes or the making, maintenance or funding of any Loan (or, in the case
of any capital adequacy or similar requirement, to have the effect of reducing
the rate of return on such Lender's or controlling Person's capital, taking
into consideration such Lender's or controlling Person's policies with respect
to capital adequacy) by an amount which such Lender deems to be material (such
Lender being deemed for this purpose to have been made, maintained or funded
each Funding Segment of the Euro-Rate Portion from a Corresponding Source of
Funds), such Lender may from time to time notify the Borrower of the amount
determined in good faith (using any averaging and attribution methods) by such
Lender (which determination shall be conclusive absent manifest error) to be
necessary to compensate such Lender or such Notional Euro-Rate Funding Office
for such increase, reduction or imposition; provided, no such compensation
shall be payable to any Lender with respect to periods prior to 90 days prior
to the date such Lenders give such notice. Such amount shall be due and
payable by the Borrower to such Lender ten Business Days after such notice is
given.
(b) Funding Breakage. In addition to all other amounts payable
hereunder, if and to the extent for any reason (including without limitation
any attempted revocation of a Standard Notice given pursuant to Section 2.03,
2.05 or 2.06 hereof) any part of any Funding Segment of any Euro-Rate Portion
of the Loans becomes due (by acceleration or otherwise), or is paid, repaid or
converted to another interest rate Option (whether or not such payment,
repayment or conversion is mandatory or automatic and whether or not such
payment or repayment is then due), on a day other than the last day of the
corresponding Funding Period (the date such amount so becomes due, or is so
paid, repaid or converted, being referred to as the "Funding Breakage Date"),
the Borrower shall pay each Lender an amount ("Funding Breakage Indemnity")
determined by such Lender as follows:
(i) first, calculate the following amount: (A) the principal
amount of such Funding Segment of the Loans owing to such Lender which
so became due, or which was so paid, repaid or converted, times (B) the
rate of interest applicable to such principal amount on the Funding
Breakage Date minus the Treasury Rate as of the Funding Breakage Date,
times (C) the number of days from and including the Funding Breakage
Date to but not including the last day of such Funding Period, times (D)
1/360; and
(ii) the Funding Breakage Indemnity to be paid by the Borrower to
such Lender shall be the amount equal to the present value as of the
Funding Breakage Date (discounted at the Treasury Rate as of such
Funding Breakage Date, and calculated on the basis of a year of 365 or
366 days, as the case may be, and actual days elapsed) of the amount
described in the preceding clause (i) which amount described in the
preceding clause (i) is assumed for purposes of such present value
calculation to be payable on the last day of the corresponding Funding
Period).
Such Funding Breakage Indemnity shall be due and payable on demand. In
addition, the Borrower shall, on the due date for payment of any Funding
Breakage Indemnity, pay to such Lender an additional amount equal to interest
on such Funding Breakage Indemnity from the Funding Breakage Date to but not
including such due date at the Base Rate Option (calculated on the basis of a
year of 365 or 366 days and actual days elapsed). The amount payable to each
Lender under this Section 2.10 (b) shall be determined in good faith by such
Lender, and such determination shall be conclusive absent manifest error.
The Lenders agree that if any Funding Breakage Indemnity will be
due and payable as a result of an event described in Section 2.04 (d) (ii)
hereof, the Lenders will take such action to minimize the amount of such
Funding Breakage Indemnity to the extent such Lender determines in its sole
discretion that such action is practicable and would not have an adverse
effect on such Lender or any Notional Euro-Rate Funding Office (it being
assumed for purposes of such determination that each Funding Segment of the
Euro-Rate Portion is actually made or maintained by or refunded through a
Corresponding Source of Funds).
2.11. Taxes.
(a) Payments Net of Taxes. For so long as and to the extent each
Lender (and Participant) complies with Section 2.11 (c) with respect to
delivery of the forms referred to therein to the extent required therein, all
payments made by the Borrower under this Agreement or any other Loan Document
shall be made free and clear of, and without reduction or withholding for or
on account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental
Authority, and all liabilities with respect thereto, excluding
(i) in the case of each Lender, income or franchise taxes imposed
on such Lender by the jurisdiction under the laws of which such Lender
is organized and the country in which such jurisdiction of organization
is located of any political subdivision or taxing authority thereof or
therein or as a result of a connection between such Lender and any
jurisdiction other than a connection resulting solely from this
Agreement and the transactions contemplated hereby, and
(ii) in the case of each Lender, income or franchise taxes
imposed by any jurisdiction (federal, state and local) in which such
Lender's lending offices which make or book Loans are located or any
political subdivision or taxing authority thereof or therein
(all such non-excluded taxes, levies, imposts, deductions, charges or
withholdings being hereinafter called "Taxes"). If any Taxes are required to
be withheld or deducted from any amounts payable to any Lender under this
Agreement or any other Loan Document, the Borrower shall pay the relevant
amount of such Taxes and the amounts so payable to such Lender shall be
increased to the extent necessary to yield to such Lender (after payment of
all Taxes) interest or any such other amounts payable hereunder at the rates
or in the amounts specified in this Agreement and the other Loan Documents.
Whenever any Taxes are paid by the Borrower with respect to payments made in
connection with this Agreement or any other Loan Document, as promptly as
possible thereafter, the Borrower shall send to such Lender, as the case may
be, a certified copy of an original official receipt received by the Borrower
showing payment thereof.
(b) Indemnity. The Borrower hereby indemnifies each of the
Lenders for the full amount of all Taxes required to be withheld or deducted
from any amounts payable by or on behalf of the Borrower hereunder or under
any of the other Loan Documents, any such Taxes paid by such Lender, any
present or future claims, liabilities or losses with respect to or resulting
from any omission to pay or delay in paying any such Taxes (including any
incremental Taxes, interest or penalties that may become payable by such
Lender as a result of any failure to pay such Taxes), whether or not such
Taxes were correctly or legally asserted. Such indemnification shall be made
within 30 days from the date such Lender makes written demand therefor.
(c) Withholding and Backup Withholding. Each Lender that is
incorporated or organized under the laws of any jurisdiction other than the
United States or any State thereof agrees that, on or prior to the date any
payment is due to be made to it hereunder or under any other Loan Document, it
will furnish to the Borrower
(i) two valid, duly completed copies of United States Internal
Revenue Service Form 4224 or United States Internal Revenue Form 1001 or
successor applicable form as the case may be, certifying in each case
that such Lender is entitled to receive payments under this Agreement
and the other Loan Documents without deduction or withholding of any
United States federal income taxes, and
(ii) a valid, duly completed Internal Revenue Service Form W-8 or
W-9 or successor applicable form, as the case may be, to establish an
exemption from United States backup withholding tax.
Each Lender which so delivers to the Borrower a Form 1001 or 4224 and Form W-8
or W-9, or successor applicable forms agrees to deliver to the Borrower two
further copies of the said Form 1001 or 4224 and Form W-8 or W-9, or successor
applicable forms, or other manner of certification, as the case may be, on or
before 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 tax, or after the occurrence of any event requiring a change in
the most recent form previously delivered by it, and such extensions or
renewals thereof as may reasonably be requested by the Borrower, certifying in
the case of a Form 1001 or Form 4224 that such Lender is entitled to receive
payments under this Agreement or any other Loan Document without deduction or
withholding of any United States Federal income taxes, unless in any such
cases an event (including any changes in Law) has occurred prior to the date
on which any such delivery would otherwise be required which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such letter or form with respect to it and such Lender advises
the Borrower that it is not capable of receiving payments without any
deduction or withholding of the United States federal income tax, and in the
case of a Form W-8 or W-9, establishing an exemption from United States backup
withholding tax.
2.12. Funding by Branch, Subsidiary or Affiliate.
(a) Notional Funding. Each Lender shall have the right from time
to time, prospectively or retrospectively, without notice to the Borrower, to
deem any branch, subsidiary or affiliate of such Lender to have made,
maintained or funded any part of the Euro-Rate Portion at any time. Any
branch, subsidiary or affiliate so deemed shall be known as a "Notional Euro-
Rate Funding Office." Such Lender shall deem any part of the Euro-Rate
Portion of the Loans or the funding therefor to have been transferred to a
different Notional Euro-Rate Funding Office if such transfer would avoid or
cure an event or condition described in Section 2.04 (d) (ii) hereof or would
lessen compensation payable by the Borrower under Section 2.10 (a) hereof, and
if such Lender determines in its sole discretion that such transfer would be
practicable and would not have a material adverse effect on such part of the
Loans, such Lender or any Notional Euro-Rate Funding Office (it being assumed
for purposes of such determination that each part of the Euro-Rate Portion is
actually made or maintained by or funded through the corresponding Notional
Euro-Rate Funding Office). Notional Euro-Rate Funding Offices may be selected
by such Lender without regard to such Lender's actual methods of making,
maintaining or funding Loans or any sources of funding actually used by or
available to such Lender.
(b) Actual Funding. Each Lender shall have the right from time
to time to make or maintain any part of the Euro-Rate Portion by arranging for
a branch, subsidiary or affiliate of such Lender to make or maintain such part
of the Euro-Rate Portion. Such Lender shall have the right to (i) hold any
applicable Note payable to its order for the benefit and account of such
branch, subsidiary or affiliate or (ii) request the Borrower to issue one or
more promissory notes in the principal amount of such Euro-Rate Portion, in
substantially the form attached hereto as Exhibit A , as the case may be, with
the blanks appropriately filled, payable to such branch, subsidiary or
affiliate and with appropriate changes reflecting that the holder thereof is
not obligated to make any additional Loans to the Borrower. The Borrower
agrees to comply promptly with any request under subsection (ii) of this
Section 2.12 (b). If any Lender causes a branch, subsidiary or affiliate to
make or maintain any part of the Euro-Rate Portion hereunder, all terms and
conditions of this Agreement shall, except where the context clearly requires
otherwise, be applicable to such part of the Euro-Rate Portion and to any note
payable to the order of such branch, subsidiary or affiliate to the same
extent as if such part of the Euro-Rate Portion were made or maintained and
such note were a Revolving Credit Note, as the case may be, payable to such
Lender's order.
2.13. Currency Equivalents. For purposes of the provisions of
this Article II, the equivalent in Dollars of an Alternate Currency and the
equivalent in an Alternate Currency of Dollars shall be determined (i) for
Deutsche Marks and Pounds Sterling by using the appropriate fixings shown on
Reuters Page DRBX screen at 8:00 a.m., New York time, and (ii) for Canadian
Dollars by using the Bank of Canada "Noon Fixing" shown on Reuters Page RBCM
Screen at 12:00 o'clock (noon) New York time, in each case on the date such
determination is made.
2.14. Lender's Sharing of Information. Each Lender agrees that,
upon the request of any other Lender, it shall promptly provide such
requesting Lender with information in writing with respect to Loans and Other
Advances made to Borrower by it and/or commercial paper vehicles utilized by
it, including the amounts, currencies and maturity dates thereof and such
other information as may be reasonably requested.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents and warrants to each Lender as
follows:
3.01. Corporate Status. The Borrower and each Subsidiary of the
Borrower is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation. The Borrower
and each Subsidiary of the Borrower has corporate power and authority to own
its property and to transact the business in which it is engaged or presently
proposes to engage. The Borrower and each Subsidiary of the Borrower is duly
qualified to do business as a foreign corporation and is in good standing in
all jurisdictions in which the ownership of its properties or the nature of
its activities or both makes such qualification necessary or advisable, except
for matters that, individually or in the aggregate, would not have a Material
Adverse Effect.
3.02. Corporate Power and Authorization. The Borrower has
corporate power and authority to execute, deliver, perform, and take all
actions contemplated by, each Loan Document, and all such action has been duly
and validly authorized by all necessary corporate proceedings on its part.
Without limitation of the foregoing, the Borrower has the corporate power and
authority to borrow pursuant to the Loan Documents to the fullest extent
permitted thereby from time to time, and has taken all necessary corporate
action to authorize such borrowings.
3.03. Execution and Binding Effect. This Agreement and each
other Loan Document which is required to be delivered on or before the Closing
Date pursuant to Section 4.01 hereof has been duly and validly executed and
delivered by the Borrower. This Agreement and each such other Loan Document
constitutes, and each other Loan Document when executed and delivered by the
Borrower will constitute, the legal, valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its terms, except
as the enforceability thereof may be limited by bankruptcy, insolvency or
other similar laws of general application affecting the enforcement of
creditors' rights or by general principles of equity limiting the availability
of equitable remedies.
3.04. Governmental Approvals and Filings. No approval, order,
consent, authorization, certificate, license, permit or validation of, or
exemption or other action by, or filing, recording or registration with, or
notice to, any Governmental Authority (collectively, "Governmental Action") is
or will be necessary or advisable in connection with execution and delivery of
any Loan Document, consummation by the Borrower of the transactions herein or
therein contemplated, performance of or compliance with the terms and
conditions hereof or thereof by the Borrower or to ensure the legality,
validity, binding effect, enforceability or admissibility in evidence hereof
or thereof.
3.05. Absence of Conflicts. Neither the execution and delivery
of any Loan Document by the Borrower, nor consummation by the Borrower of the
transactions herein or therein contemplated, nor performance of or compliance
with the terms and conditions hereof or thereof by the Borrower does or will
(a) violate or conflict with any Law, or
(b) violate, conflict with or result in a breach of any term or
condition of, or constitute a default under, or result in (or give rise
to any right, contingent or otherwise, of any Person to cause) any
termination, cancellation, prepayment or acceleration of performance of,
or result in the creation or imposition of (or give rise to any
obligation, contingent or otherwise, to create or impose) any Lien upon
any of property of the Borrower or any Subsidiary of the Borrower
pursuant to, or otherwise result in (or give rise to any right,
contingent or otherwise, of any Person to cause) any material change in
any right, power, privilege, duty or obligation of the Borrower or any
Subsidiary of the Borrower under or in connection with,
(i) the articles of incorporation or by-laws (or other
constituent documents) of the Borrower or any such Subsidiary,
(ii) any agreement or instrument which is material to the
Borrower and its Subsidiaries taken as a whole creating, evidencing
or securing any Indebtedness or Guaranty Equivalent to which the
Borrower or any such Subsidiary of the Borrower is a party or by
which any of them or any of their respective properties (now owned
or hereafter acquired) may be subject or bound, or
(iii) any other agreement or instrument which is material
to the Borrower and its Subsidiaries taken as a whole to which the
Borrower or any such Subsidiary is a party or by which any of them
or any of their respective properties (now owned or hereafter
acquired) may be subject or bound.
3.06. Audited Financial Statements. The Borrower has heretofore
furnished to each Lender consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as of June 30, 1995 and the related consolidated
statements of income, cash flows and changes in stockholders' equity for the
fiscal year then ended, as examined and reported on by Arthur Andersen LLP,
independent certified public accountants for the Borrower, who delivered an
unqualified opinion in respect thereof. Such financial statements (including
the notes thereto) present fairly the financial condition of the Borrower and
its consolidated Subsidiaries as of the end of such fiscal year and the
results of their operations and their cash flows for the fiscal year then
ended, all in conformity with GAAP.
3.07. Interim Financial Statements. The Borrower has heretofore
furnished to each Lender interim consolidated balance sheets of the Borrower
and its consolidated Subsidiaries as of the end of each of the first two
fiscal quarters of the fiscal year beginning July 1, 1995, together with the
related consolidated statements of income, cash flows and changes in
stockholders' equity for the applicable fiscal periods ending on each such
date. Such financial statements (including the notes thereto) present fairly
the financial condition of the Borrower and its consolidated Subsidiaries as
of the end of each such fiscal quarter and the results of their operations and
their cash flows for the fiscal periods then ended, all in conformity with
GAAP, subject to normal and recurring year-end audit adjustments and except
that such financial statements do not contain all of the footnote disclosures
required by GAAP.
3.08. Absence of Undisclosed Liabilities. Neither the Borrower
nor any Subsidiary of the Borrower has any liability or obligation of any
nature whatsoever (whether absolute, accrued, contingent or otherwise, whether
or not due), forward or long-term commitments or unrealized or anticipated
losses from unfavorable commitments, except (a) as disclosed in the financial
statements referred to in Sections 3.06, and 3.07 hereof, (b) matters that,
individually or in the aggregate, would not have a Material Adverse Effect, or
(c) liabilities, obligations, commitments and losses incurred after June 30,
1995, in the ordinary course of business and consistent with past practices.
3.09. Absence of Material Adverse Changes. Since June 30, 1995,
there has been no material adverse change in the business, operations or
condition (financial or otherwise) of the Borrower and its Subsidiaries taken
as a whole.
3.10. Subsidiaries and Other Investments. The Borrower directly
or indirectly owns the issued and outstanding capital stock of every class and
series of the corporations, and equity interests in the joint ventures,
partnerships and other entities, set forth in Schedule 3.10 and directly or
indirectly owns none of the capital stock of any other corporation,
association, trust or other entity, and no interest, share in the equity of
any partnership, joint venture, or other entity or enterprise in excess of an
aggregate book value of $1,000,000, except as otherwise set forth in Schedule
3.10. All of the outstanding shares of stock directly or indirectly owned by
the Company in each corporation listed on Schedule 3.10 are duly authorized,
validly issued, fully paid and nonassessable.
3.11. Accurate and Complete Disclosure. All written financial
and other factual information heretofore, contemporaneously or hereafter
provided by or on behalf of the Borrower or any Subsidiary to any Lender
pursuant to or in connection this Agreement (or any predecessor agreement) is
or will be (as the case may be) true and accurate in all material respects on
the date as of which such information is dated (or, if not dated, when
received by such Lender) and does not or will not (as the case may be) omit to
state any material fact necessary to make such information (taken as a whole)
not misleading at such time in light of the circumstances in which it was
provided. The Borrower has disclosed to each Lender every fact or
circumstance known to the Borrower which has, or which could have so far as
the Borrower can now reasonably forsee, a Material Adverse Effect.
3.12. Margin Regulations. No part of the proceeds of any Loan
hereunder will be used for the purpose of buying or carrying any "margin
stock," as such term is used in Regulations G and U of the Board of Governors
of the Federal Reserve System, as amended from time to time, or to extend
credit to others for the purpose of buying or carrying any "margin stock".
Neither the Borrower nor any Subsidiary of the Borrower is engaged in the
business of extending credit to others for the purpose of buying or carrying
"margin stock". The aggregate value of all "margin stock" owned by the
Borrower and its Subsidiaries (including stock held as treasury stock by the
Borrower) does not exceed 25% of the value of the total assets of the
Borrower. Neither the making of any Loan nor any use of proceeds of any such
Loan will violate or conflict with the provisions of Regulations G, T, U or X
of the Board of Governors of the Federal Reserve System, as amended from time
to time.
3.13. Litigation. There is no pending or (to the Borrower's
knowledge after due inquiry) threatened action, suit, or proceeding, or any
investigation by or before any Governmental Authority, against or affecting
the Borrower or any Subsidiary of the Borrower, except for (a) matters set
forth in Schedule 3.13 hereto, (b) matters described in the financial
statements referred to in Section 3.06 and 3.07 hereof, and (c) matters that,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.
3.14. Absence of Events of Default. No event has occurred and is
continuing and no condition exists which constitutes an Event of Default or
Potential Default.
3.15. Absence of Other Conflicts. Neither the Borrower nor any
Subsidiary of the Borrower is in violation of or conflict with, or is subject
to any contingent liability on account of any violation of or conflict with:
(a) any Law,
(b) its articles of incorporation or by-laws (or other
constituent documents), or
(c) any agreement or instrument or arrangement to which it is
party or by which any of its properties (now owned or hereafter
acquired) may be subject or bound,
except for matters that, individually or in the aggregate, would not have a
Material Adverse Effect.
3.16. Insurance. The Borrower and each Subsidiary of the
Borrower maintains with financially sound and reputable insurers not related
to or affiliated with the Borrower insurance with respect to its properties
and business and against at least such liabilities, casualties and
contingencies and in at least such types and amounts as is customary in the
case of corporations engaged in the same or a similar business or having
similar properties similarly situated.
3.17. Title to Property. The Borrower and each Subsidiary of the
Borrower has good and marketable title to all real property owned or purported
to be owned by it and good title to all other property of whatever nature
owned or purported to be owned by it, including but not limited to all
property reflected in the most recent audited balance sheet referred to in
Section 3.06 hereof or submitted pursuant to Section 5.01 (a) hereof (except
as sold or otherwise disposed of in the ordinary course of business after the
date of such balance sheet or, after the Closing Date, as otherwise permitted
by the Loan Documents), in each case free and clear of all Liens, other than
Permitted Liens.
3.18. Intellectual Property. The Borrower and each Subsidiary of
the Borrower owns, or is licensed or otherwise has the right to use, all the
patents, trademarks, service marks, names (trade, service, fictitious or
otherwise), copyrights, technology (including but not limited to computer
programs and software), processes, data bases and other rights, free from
burdensome restrictions, material to the ownership or operation of its
properties and its business as presently conducted and presently planned to be
conducted without material conflict with the rights of others.
3.19. Taxes. All tax and information returns required to be
filed by or on behalf of the Borrower or any Subsidiary of the Borrower have
been properly prepared, executed and filed, except for failures to properly
prepare, execute and file which in the aggregate would not have a Material
Adverse Effect. All taxes, assessments, fees and other governmental charges
upon the Borrower or any Subsidiary of the Borrower or upon any of their
respective properties, incomes, sales or franchises which are due and payable
have been paid, except for failures to pay which in the aggregate would not
have a Material Adverse Effect. The reserves and provisions for taxes on the
books of the Borrower and each Subsidiary of the Borrower are adequate in all
material respects for all open years and for its current fiscal period.
Neither the Borrower nor any Subsidiary of the Borrower knows of any proposed
additional assessment or basis for any assessment for additional taxes
(whether or not reserved against) which assessments or potential assessments
would in the aggregate have a Material Adverse Effect. Except as set forth on
Schedule 3.19, neither the Borrower nor any Subsidiary of the Borrower nor any
of their respective consolidated return group has at any time filed a
consolidated tax return with any Person other than the Borrower and its
Subsidiaries.
3.20. Employee Benefits. Each Plan has been maintained, in all
material respects, in accordance with its terms and with all provisions of
ERISA applicable thereto, no Pension-Related Event has occurred and is
continuing with respect to any Plan and neither the Borrower nor any of its
Controlled Group Members has incurred any liability to the PBGC, other than
the payment of periodic PBGC premiums.
3.21. Environmental Matters. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital
or operating expenditures required for clean-up or closure of properties
presently or previously owned or operated, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by Law or as a condition of any license, permit
or contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level or
change in the nature of operations conducted thereat and any actual potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Borrower has reasonably concluded
that Environmental Laws are unlikely to have a Material Adverse Effect. No
Liens exist, and no conditions exist which could result in the filing of
Liens, against any property of the Borrower or any Subsidiary of the Borrower
or any of their respective Environmental Affiliates, under any Environmental
Law, which Liens in the aggregate could have a Material Adverse Effect.
3.22. Investment Company; Public Utility Holding Company. The
Borrower is not (a) an "investment company" or a company "controlled" by an
investment company within the meaning of the Investment Company Act of 1940,
as amended, or (b) a "holding company" or a "subsidiary company" of a "holding
company" or an "affiliate" of either a "holding company" or a "subsidiary
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
ARTICLE IV
CONDITIONS OF LENDING
4.01. Conditions to Initial Loans. The effectiveness of this
Agreement and the obligation of each Lender to make any Loan on the Closing
Date is subject to the satisfaction, immediately prior to or concurrently with
the making of such Loan, of the following conditions precedent, in addition to
the conditions precedent set forth in Section 4.02 hereof:
(a) Agreement; Notes. Each Lender shall have received an
executed counterpart of this Agreement, duly executed by the Borrower,
and an executed Revolving Credit Note, and Bid Loan Note conforming to
the requirements hereof, duly executed on behalf of the Borrower.
(b) Corporate Proceedings. Each Lender shall have received
certificates by the Secretary or Assistant Secretary of the Borrower
dated as of the Closing Date as to (i) true copies of the articles of
incorporation and by-laws (or other constituent documents) of the
Borrower in effect on such date (ii) true copies of all corporate action
taken by the Borrower relative to this Agreement and the other Loan
Documents and (iii) the incumbency and signature of the officers of the
Borrower executing this Agreement and the other Loan Documents together
with satisfactory evidence of the incumbency of such Secretary or
Assistant Secretary.
(c) Existing Agreement. The Borrower shall have repaid all
amounts, whether principal, interest, fees or otherwise, outstanding
under the Existing Credit Agreements and shall have terminated all
commitments to lend thereunder; provided, however, that (i) the Lenders
and the Borrower hereby agree that any Commitments to lend under the
Existing Credit Agreement shall be terminated upon the execution of this
Agreement automatically and without further action by any party and (ii)
so long as all other conditions to lending under this Agreement have
been satisfied, Loans under this Agreement on the date hereof shall be
used to repay any amounts outstanding under the Existing Agreement.
(d) Legal Opinions of Counsel to the Borrower. Each Lender
shall have received an opinion addressed to each Lender, dated the
Closing Date, of David Cofer, Esquire, General Counsel of the Borrower,
in substantially the form attached hereto as Exhibit F.
(e) Fees, Expenses, etc. All fees and other compensation and
expenses required to be paid to the Lenders pursuant hereto or pursuant
to any other written agreement on or prior to the Closing Date shall
have been paid or received.
(f) Additional Matters. Each Lender shall have received such
other certificates, opinions, documents and instruments as may be
reasonably requested by any Lender. All corporate and other
proceedings, and all documents, instruments and other matters in
connection with the transactions contemplated by this Agreement and the
other Loan Documents shall be satisfactory in form and substance to each
Lender.
(g) No Material Adverse Change. There shall not have occurred
any event, act or condition which could have a Material Adverse Effect.
4.02. Conditions to All Loans. The obligation of each Lender to
make any Loan pursuant to Section 2.02 or 2.03 (but not to convert or renew
any Loan pursuant to Section 2.05) is subject to performance by the Borrower
of its obligations to be performed hereunder or under the other Loan Documents
on or before the date of such Loan, satisfaction of the conditions precedent
set forth herein and in the other Loan Documents and to satisfaction of the
following further conditions precedent:
(a) Notice. Appropriate notice of such Loan shall have been
given by the Borrower as provided in Article II hereof.
(b) Representations and Warranties. Each of the representations
and warranties made by the Borrower in Article III hereof (other than
Section 3.09 and Section 3.10) shall be true and correct in all
material respects on and as of such date as if made on and as of such
date, both before and after giving effect to the Loans requested to be
made on such date; provided that for purposes of this Section 4.02 (b),
as it relates to the representations and warranties contained in Section
3.13, Schedule 3.13 shall be deemed to be updated by and to the extent
that any such action, suit, proceeding or investigation is set forth in
any Form 10-K, 10-Q or 8-K filed by the Borrower and provided to the
Lenders pursuant to this Agreement after the date hereof.
(c) No Defaults. No Event of Default or Potential Default shall
have occurred and be continuing on such date or after giving effect to
the Loans requested to be made on such date.
(d) No Violations of Law, etc. Neither the making nor use of the
Loans shall cause any Lender to violate or conflict with any Law.
(e) Authorization. Such Loan and the amount thereof, when
aggregated with all other outstanding Loans and Other Advances
outstanding shall be duly authorized by and within the corporate
authority of, Borrower both before and after giving effect to the Loans
and Other Advances requested to be made on such date.
Each request by the Borrower for any Loan shall constitute a representation
and warranty by the Borrower that the conditions set forth in this Section
4.02 have been satisfied as of the date of such request. Failure of the
Lenders to receive notice from the Borrower to the contrary before such Loan
is made shall constitute a further representation and warranty by the Borrower
that the conditions referred to in this Section 4.02 have been satisfied as of
the date such Loan is made.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower hereby covenants to each Lender as follows:
5.01. Basic Reporting Requirements.
(a) Annual Audit Reports. As soon as practicable, and in any
event within 120 days after the close of each fiscal year of the Borrower, the
Borrower shall furnish to each Lender statements of income, cash flows and
changes in stockholders' equity of the Borrower and its consolidated
Subsidiaries for such fiscal year and a consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as of the close of such fiscal
year, and notes to each, all in reasonable detail, setting forth in
comparative form the corresponding figures for the preceding fiscal year.
Such financial statements shall be accompanied by an opinion of independent
certified public accountants of recognized national standing selected by the
Borrower and reasonably satisfactory to the Lenders. Such opinion shall be
free of exceptions or qualifications not reasonably acceptable to the Lenders.
Such opinion in any event shall contain a written statement of such
accountants substantially to the effect that (i) such accountants examined
such financial statements in accordance with generally accepted auditing
standards and accordingly made such tests of accounting records and such other
auditing procedures as such accountants considered necessary in the
circumstances and (ii) in the opinion of such accountants such financial
statements present fairly the financial position of the Borrower and its
consolidated Subsidiaries as of the end of such fiscal year and the results of
their operations and their cash flows and changes in stockholders' equity for
such fiscal year, in conformity with GAAP.
(b) Quarterly Consolidated Reports. As soon as practicable, and
in any event within 60 days after the close of each of the first three fiscal
quarters of each fiscal year of the Borrower, the Borrower shall furnish to
each Lender consolidated statements of income, cash flows and changes in
stockholders' equity of the Borrower and its consolidated Subsidiaries for
such fiscal quarter and for the period from the beginning of such fiscal year
to the end of such fiscal quarter and unaudited consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as of the close of such fiscal
quarter, all in reasonable detail, setting forth in comparative form the
corresponding figures for the same periods or as of the same date during the
preceding fiscal year (except for the consolidated balance sheet, which shall
set forth in comparative form the corresponding balance sheet as of the prior
fiscal year end). Such financial statements shall be certified by a
Responsible Officer of the Borrower as presenting fairly the financial
position of the Borrower and its consolidated Subsidiaries as of the end of
such fiscal quarter and the results of their operations and their cash flows
and changes in stockholders' equity for such fiscal year, in conformity with
GAAP, subject to normal and recurring year-end audit adjustments.
(c) Quarterly Compliance Certificates; Performance Pricing
Certificate. The Borrower shall deliver to each Lender (i) a Quarterly
Compliance Certificate concurrently with the delivery of the financial
statements referred to in subsections (a) and (b) of this Section 5.01, and
(ii) a Performance Pricing Certificate within 55 days after the end of each
fiscal quarter, commencing with the quarter ending March 31, 1996.
(d) Certain Other Reports and Information. Promptly upon their
becoming available to the Borrower, the Borrower shall deliver to each Lender
a copy of (i) all regular or special reports, registration statements and
amendments to the foregoing which the Borrower or any Subsidiary shall file
with the Securities and Exchange Commission (or any successor thereto) or (ii)
all reports, proxy statements, financial statements and other information
distributed by the Borrower to its stockholders, bondholders or the financial
community generally.
(e) Further Information. The Borrower will promptly furnish to
each Lender such other information and in such form as any Lender may
reasonably request from time to time.
(f) Notice of Certain Events. Promptly upon becoming aware of
any of the following, the Borrower shall give each Lender notice thereof,
together with a written statement of a Responsible Officer of the Borrower
setting forth the details thereof and any action with respect thereto taken or
proposed to be taken by the Borrower:
(i) Any Event of Default or Potential Default.
(ii) Any Material Adverse Effect.
(iii) Any pending or threatened action, suit, proceeding of
investigation by or before any Governmental Authority against or
affecting the Borrower or any Subsidiary of the Borrower, except for
matters that if adversely decided, individually or in the aggregate,
would not have a Material Adverse Effect.
(iv) Any material violation, breach or default by the Borrower or
any Subsidiary of the Borrower of or under any agreement or instrument
material to the business, operations, condition (financial or otherwise)
or prospects of the Borrower and its Subsidiaries taken as a whole.
(v) Any Pension-Related Event. Such notice shall be accompanied
by: (A) a copy of any notice, request, return, petition or other
document received by the Borrower or any Controlled Group Member from
any Person, or which has been or is to be filed with or provided to any
Person (including without limitation the Internal Revenue Service, PBGC
or any Plan participant, beneficiary, alternate payee or employer
representative), in connection with such Pension-Related Event, and (B)
in the case of any Pension-Related Event with respect to a Plan, the
most recent Annual Report (5500 Series), with attachments thereto, and
the most recent actuarial valuation report, for such Plan, unless such
documents shall have been previously provided to the Lenders.
(vi) Any Environmental Claim pending or threatened against the
Borrower or any Subsidiary of the Borrower or any of their respective
Environmental Affiliates, or any past or present acts, omissions, events
or circumstances (including but not limited to any dumping, leaching,
deposition, removal, abandonment, escape, emission, discharge or release
of any Environmental Concern Material at, on or under any facility or
property now or previously owned, operated or leased by the Borrower or
any Subsidiary of the Borrower or any of their respective Environmental
Affiliates) that could form the basis of such Environmental Claim, which
Environmental Claims, individually or in the aggregate, would be
reasonably expected to have a Material Adverse Effect.
(g) Visitation; Verification. The Borrower shall permit such
Persons as any Lender may designate from time to time to visit and inspect any
of the properties of the Borrower and of any Subsidiary, to examine their
respective books and records and take copies and extracts therefrom and to
discuss their respective affairs with their respective directors, officers,
employees and independent accountants during regular business hours and as
often as any Lender may reasonably request. The Borrower hereby authorizes
such officers, employees and independent accountants to discuss with each
Lender the affairs of the Borrower and its Subsidiaries. Each Lender shall
have the right during regular business hours to examine and verify accounts,
inventory and other properties and liabilities of the Borrower and its
Subsidiaries from time to time during regular business hours, and the Borrower
shall cooperate, and shall cause each Subsidiary to cooperate, with the
Lenders in such verification.
5.02. Insurance. The Borrower shall, and shall cause each
Subsidiary to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business and against such
liabilities, casualties and contingencies and of such types and in such
amounts as is customary in the case of corporations engaged in the same or
similar businesses or having similar properties similarly situated.
5.03. Payment of Taxes and Other Potential Charges and Priority
Claims. The Borrower shall, and shall cause each Subsidiary to, pay or
discharge
(a) on or prior to the date on which penalties attach thereto,
all taxes, assessments and other governmental charges imposed upon it or
any of its properties;
(b) on or prior to the date when due, all lawful claims of
materialmen, mechanics, carriers, warehousemen, landlords and other like
Persons which, if unpaid, might result in the creation of a Lien upon
any such property; and
(c) on or prior to the date when due, all other lawful claims
which, if unpaid, might result in the creation of a Lien upon any such
property or which, if unpaid, might give rise to a claim entitled to
priority over general creditors of the Borrower or such Subsidiary in a
case under Title 11 (Bankruptcy) of the United States Code, as amended,
or under foreign bankruptcy, insolvency or similar Laws;
provided, that unless and until foreclosure, distraint, levy, sale or similar
proceedings shall have been commenced the Borrower or such Subsidiary need not
pay or discharge any such tax, assessment, charge or claim so long as (x) the
validity thereof is contested in good faith and by appropriate proceedings
diligently conducted, (y) such reserves or other appropriate provisions as may
be required by GAAP shall have been made therefor, and (z) such failure to pay
or discharge would not have a Material Adverse Effect.
5.04. Preservation of Corporate Status. The Borrower shall, and
shall cause each of its Subsidiaries to maintain its status as a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, provided, however, that (i) so long as no Event
of Default or Potential Default then exists or would be created thereby, the
Borrower may terminate the corporate existence of any of its Subsidiaries if,
in the good faith judgment of the appropriate officers of Borrower, such
termination would not be disadvantageous to the Borrower or the Lender in any
material respect and (ii) the Borrower and its Subsidiaries may enter into
transactions permitted by Section 6.04 hereof. The Borrower shall, and shall
cause each of its Subsidiaries to, be duly qualified to do business as a
foreign corporation and in good standing in all jurisdictions in which the
ownership of its properties or the nature of its business or both make such
qualification necessary or advisable, except for matters that, individually or
in the aggregate, would not have a Material Adverse Effect.
5.05. Governmental Approvals and Filings. The Borrower shall,
and shall cause each Subsidiary to, keep and maintain in full force and effect
all Governmental Actions necessary or advisable in connection with execution
and delivery of any Loan Document by the Borrower, consummation by the
Borrower of the transactions herein or therein contemplated, performance of or
compliance with the terms and conditions hereof or thereof by the Borrower or
to ensure the legality, validity, binding effect, enforceability or
admissibility in evidence hereof or thereof.
5.06. Maintenance of Properties. The Borrower shall, and shall
cause each Subsidiary to, maintain or cause to be maintained in good repair,
working order and condition (reasonable wear and tear excepted) the properties
now or hereafter owned, leased or otherwise possessed by it and shall make or
cause to be made all needful and proper repairs, renewals, replacements and
improvements thereto so that the business of the Borrower and its Subsidiaries
taken as a whole may be properly and advantageously conducted at all times.
5.07. Avoidance of Other Conflicts. The Borrower shall not, and
shall not permit any of its Subsidiaries to, violate or conflict with, be in
violation of or conflict with, or be or remain subject to any liability
(contingent or otherwise) on account of any violation or conflict with
(a) any Law,
(b) its articles of incorporation or by-laws (or other
constituent documents), or
(c) any agreement or instrument to which it is party or by which
any of them or any of their respective Subsidiaries is a party or by
which any of them or any of their respective properties (now owned or
hereafter acquired) may be subject or bound
except for matters that would not, individually or in the aggregate, have a
Material Adverse Effect.
5.08. Financial Accounting Practices. The Borrower shall, and
shall cause each Subsidiary to, make and keep books, records and accounts
which, in reasonable detail, accurately and fairly reflect its transactions
and dispositions of its assets and maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (a) transactions are
executed in accordance with management's general or specific authorization,
(b) transactions are recorded as necessary (i) to permit preparation of
consolidated financial statements in conformity with GAAP and (ii) to maintain
accountability for assets, (c) access to assets is permitted only in
accordance with management's general or specific authorization and (d) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
5.09. Use of Proceeds. The Borrower will use (i) the proceeds of
the Loans made on the Closing Date to repay in full all principal, interest,
fees and other amounts outstanding under the Existing Credit Agreement; and
(ii) and the proceeds of all other Loans for general corporate purposes.
5.10. Nature of Business. Neither the Company nor any Subsidiary
will engage in any business if, as a result, the general nature of the
business, taken on a consolidated basis, which would then be engaged in by the
Company and its Subsidiaries would be substantially and significantly changed
from the general nature of the business engaged in by the Company and its
Subsidiaries taken on a consolidated basis on the date of this Agreement.
ARTICLE VI
NEGATIVE COVENANTS
The Borrower hereby covenants to each Lender as follows:
6.01. Financial Covenants.
(a) Consolidated Tangible Net Worth. Consolidated Tangible Net
Worth shall not at any time be less than $350,000,000 plus 40% of the
Consolidated Net Income for each fiscal year of Borrower from and including
1997, it being understood that there shall be no downward adjustment for any
fiscal year in which Consolidated Net Income is negative.
(b) Consolidated Funded Debt Ratio . The Consolidated Funded
Debt Ratio shall not exceed 3.25 to 1.
6.02. Liens. The Borrower shall not, and shall not permit any
Subsidiary to, at any time create, incur, assume or suffer to exist any Lien
on any of its property (now owned or hereafter acquired) without making
effective provision whereby the Obligations shall be secured equally and
ratably with the Indebtedness or other obligations secured by any such Lien,
or agree, become or remain liable (contingently or otherwise) to do any of the
foregoing, except for the following ("Permitted Liens"):
(a) Liens existing on the date hereof securing obligations
existing on the date hereof, as such Liens and obligations are listed in
Schedule 6.02 hereto (and Liens securing successor obligations incurred
to refinance predecessor obligations allowed under this subsection (a),
provided that in each case the successor obligation is an obligation of
the same Person subject to the predecessor Indebtedness and is not
greater than (and is not otherwise on terms less advantageous than) the
predecessor obligation immediately before such refinancing, and the Lien
securing the successor obligation does not extend to any property other
than that subject to the Lien securing the predecessor obligation
immediately before such refinancing);
(b) Liens arising from taxes, assessments, charges or claims
described in Section 5.03 hereof that are not yet due or that remain
payable without penalty or to the extent permitted to remain unpaid
under the proviso to such Section 5.03;
(c) Deposits or pledges of cash or securities in the ordinary
course of business to secure (i) workmen's compensation, unemployment
insurance or other social security obligations, (ii) performance of
bids, tenders, trade contracts (other than for payment of money) or
leases, (iii) stay, surety or appeal bonds, or (iv) other obligations of
a like nature incurred in the ordinary course of business;
(d) Liens by a Borrower or Subsidiary on property securing all or
part of the purchase price thereof and Liens (whether or not assumed)
existing on property at the time of purchase thereof by the Borrower or
a Subsidiary, provided that:
(i) such Lien is confined solely to the property so
purchased, improvements thereto and proceeds thereof,
(ii) the aggregate amount secured by all such Liens on any
particular property at the time purchased by the Borrower or such
Subsidiary, as the case may be, shall not exceed 100% of the lesser
of the purchase price of such property or the fair market value of
such property at the time of purchase;
(e) Liens resulting from progress payments or partial payments
under United States Government contracts or subcontracts hereunder;
(f) Zoning restrictions, easements, minor restrictions on the use
of real property, minor irregularities in title thereto and other minor
Liens that do not secure the payment of money or the performance of an
obligation and that do not in the aggregate materially detract from the
value of the property and assets of, or materially impair its use in the
business of, the Borrower and its Subsidiaries taken as a whole;
(g) Agreements in debt instruments to provide security for the
obligations evidenced thereby in the future (but not any Liens actually
granted pursuant to such agreements), which debt instruments are issued
by Subsidiaries of the Borrower organized under the laws of Germany and
contain general business conditions of the type customarily incorporated
into debt instruments governed by German Law; and
(h) Other Liens, provided that the aggregate amount of
Indebtedness secured thereby does not exceed 20% of Consolidated
Tangible Net Worth at any time.
"Permitted Lien" shall in no event include any Lien imposed by, or required to
be granted pursuant to, ERISA or any Environmental Law, which individually or
in the aggregate could have a Material Adverse Effect.
6.03. Guaranties, Indemnities, etc. The Borrower shall not, and
shall not permit any Subsidiary to, be or become subject to or bound by any
Guaranty Equivalent, or to have any letter of credit issued for the Borrower's
or any Subsidiary's account (a "Letter of Credit"), or agree, become or remain
liable (contingently or otherwise) to do any of the foregoing, except:
(a) Contingent liabilities arising from the endorsement of
negotiable or other instruments for deposit or collection or similar
transactions in the ordinary course of business;
(b) Indemnities by the Borrower or any Subsidiary of the
liabilities of its directors or officers or employees in their
capacities as such as permitted by Law;
(c) Guaranty Equivalents of Assured Obligations of Consolidated
Subsidiaries which constitute "Indebtedness," and
(d) Guaranty Equivalents of Assured Obligations of Persons other
than Consolidated Subsidiaries which, together with the face amount of
all Letters of Credit, do not in the aggregate exceed $25,000,000 at any
time.
6.04. Mergers. The Borrower shall not, and shall not permit any
Subsidiary to, merge with or into or consolidate with any other Person, or
agree, become or remain liable (contingently or otherwise) to do any of the
foregoing; provided that if no Event of Default or Potential Default shall
occur and be continuing or shall exist at such time or after giving effect to
such transaction including specifically, without limitation, any noncompliance
with Section 5.10:
(a) A Subsidiary may merge with or into or consolidate with any
other Person, or
(b) The Borrower may merge with any person, firm or corporation,
so long as the Borrower is the surviving corporation.
6.05. Dispositions of Accounts. The Borrower shall not sell,
assign, discount, transfer, or otherwise dispose of, voluntarily or
involuntarily, any of its accounts receivable or chattel paper, with or
without recourse, or agree, become or remain liable (contingently or
otherwise) to do any of the foregoing, except
(a) sales, assignments, transfers and other dispositions in
the ordinary course of business; and
(b) financings based upon direct or indirect security
interests in, or purchase of, accounts receivable not exceeding
$10,000,000 aggregate principal amount at any one time outstanding.
6.06. Limitation on Other Restrictions or Dividends by
Subsidiaries, etc. The Borrower shall not permit any Subsidiary to be or
become subject to any restriction of any nature (whether arising by operation
of Law, by agreement, by its articles of incorporation, by-laws or other
constituent documents of such Subsidiary from time to time) to (a) declare and
pay dividends with respect to capital stock owned by the Borrower or any
Subsidiary, (b) pay any indebtedness, obligations or liabilities from time to
time owed to the Borrower or any Subsidiary, (c) make loans or advances to the
Borrower or any Subsidiary, except:
(a) Restrictions pursuant to the Loan Documents; and
(b) Legal restrictions of general applicability under Law.
6.07. Limitation on Other Restrictions on Amendment of the Loan
Documents, etc. The Borrower shall not, and shall not permit any Subsidiary
to, enter into, become or remain subject any agreement or instrument to which
the Borrower or such Subsidiary is a party or by which either of them or any
of their respective properties (now owned or hereafter acquired) may be
subject or bound that would prohibit or require the consent of any Person to
any amendment, modification, supplement or waiver to any of the Loan
Documents, except for the Loan Documents.
ARTICLE VII
DEFAULTS
7.01. Events of Default. An Event of Default shall mean the
occurrence or existence of one or more of the following events or conditions
(for any reason, whether voluntary, involuntary or effected or required by
Law):
(a) The Borrower shall fail to pay when due principal of any
Loan.
(b) The Borrower shall fail to pay when due (i) any interest on
any Loan or any Fees, and such failure shall have continued for a period
of three Business Days or (ii) any indemnity or expenses or any other
amount due hereunder or under any other Loan Document and such failure
shall have continued for a period of five Business Days.
(c) Any representation or warranty made or deemed made by the
Borrower or in pursuant to any Loan Document, or any statement made by
the Borrower in any financial statement, certificate, report, exhibit or
document furnished by the Borrower to any Lender pursuant to any Loan
Document, shall prove to have been false or misleading in any material
respect as of the time when made or deemed made (including by omission
of material information necessary to make such representation, warranty
or statement not misleading).
(d) The Borrower shall default in the performance of observance
of any of the covenants contained in Sections 5.01 (f) (i), 5.09, 5.10,
6.01, 6.04 or 6.05 hereof.
(e) The Borrower shall default in the performance of observance
of any other covenant, agreement or duty under this Agreement or any
other Loan Document and (i) in the case of a default under Section 6.02,
6.03, 6.06 or 6.07 such default shall have continued for a period of
three Business Days, (ii) in the case of a default under Section 5.01
hereof (other than as referred to in subsection (f) (i) thereof) such
default shall have continued for a period of ten days and (iii) in the
case of any other default such default shall have continued for a period
of 30 days after written notice thereof from any Lender to the Borrower.
(f) Any Cross-Default Event shall occur with respect to any
Cross-Default Obligation; provided, that if a Cross- Default Event would
have occurred with respect to a Cross-Default Obligation but for the
grant of a waiver or similar indulgence, a Cross-Default Event shall
nevertheless be deemed to have occurred if the Borrower or any
Subsidiary of the Borrower directly or indirectly gave or agreed to give
any consideration for such waiver or indulgence (including but not
limited to a reduction in maturity, an increase in rates or the granting
of collateral). As used herein, "Cross-Default Obligation" shall mean
any Indebtedness or any Guaranty Equivalent (or set of related
Indebtedness or Guaranty Equivalents) of the Borrower or any Subsidiary
of the Borrower in excess of $5,000,000 in aggregate principal amount.
As used herein, "Cross-Default Event" with respect to a Cross-Default
Obligation shall mean the occurrence of any default, event or condition
which causes or which would permit any Person or Persons to cause or
which would with the giving of notice or the passage of time or both
would permit any Person or Persons to cause all or any part of such
Cross-Default Obligation to become due (by acceleration, mandatory
repayment or repurchase, or otherwise) before its otherwise stated
maturity, or failure to pay all or any part of such Cross-Default
Obligation at its stated maturity.
(g) One or more judgments for the payment of money shall have
been entered against the Borrower or any Subsidiary, which judgment or
judgments exceed $10,000,000 in the aggregate, and such judgment or
judgments shall have remained undischarged and unstayed for a period of
forty-five consecutive days.
(h) One or more writs or warrants of attachment, garnishment,
execution, distraint or similar process exceeding in value the aggregate
amount of $10,000,000 shall have been issued against the Borrower or any
Subsidiary or any of their respective properties and shall have remained
undischarged and unstayed for a period of forty-five consecutive days.
(i) Any Governmental Action now or hereafter made by or with any
Governmental Authority in connection with any Loan Document is not
obtained or shall have ceased to be in full force and effect or shall
have been modified or amended or shall have been held to be illegal or
invalid and the Lenders shall determine in good faith that such failures
to obtain or remain in full force and effect, modifications, amendments,
illegalities and invalidities in the aggregate could have a Material
Adverse Effect.
(j) Any Loan Document or term or provision thereof shall cease to
be in full force and effect (except in accordance with the express terms
of such Loan Document) and the Lenders shall determine in good faith
that such cessation could have a Material Adverse Effect, or the
Borrower shall, or shall purport to, terminate (except in accordance
with the terms of such Loan Document), repudiate, declare voidable or
void or otherwise contest, any Loan Document or term or provision
thereof or any obligation or liability of the Borrower thereunder.
(k) Any one or more Pension-Related Events referred to in
subsection (a) (ii), (b) or (e) of the definition of "Pension-Related
Event" shall have occurred and the Lenders shall determine in good faith
that the liabilities associated with such Pension-Related Events are
reasonably likely to exceed $5,000,000; or any one or more other
Pension-Related Events shall have occurred and the Lenders shall
determine in good faith that such other Pension-Related Events,
individually or in the aggregate, could have a Material Adverse Effect.
(l) A Change of Control shall have occurred.
(m) A proceeding shall have been instituted in respect of the
Borrower or any Subsidiary of the Borrower
(i) seeking to have an order for relief entered in respect
of such Person, or seeking a declaration or entailing a finding
that such Person is insolvent or a similar declaration or finding,
or seeking dissolution, winding-up, charter revocation or
forfeiture, liquidation, reorganization, arrangement, adjustment,
composition or other similar relief with respect to such Person,
its assets or its debts under any Law relating to bankruptcy,
insolvency, relief of debtors or protection of creditors,
termination of legal entities (other than as permitted by Section
5.04) or any other similar Law now or hereafter in effect, or
(ii) seeking appointment of a receiver, trustee,
liquidator, assignee, sequestrator or other custodian for such
Person or for all or any substantial part of its property (other
than as permitted by Section 5.04 hereof).
and such proceeding shall result in the entry, making or grant of any
such order for relief, declaration, finding, relief or appointment, or
such proceeding shall
remain undismissed and unstayed for a period of sixty consecutive days.
(n) The Borrower or any Subsidiary of the Borrower shall become
insolvent, shall fail to pay, become unable to pay, or state that it is
or will be unable to pay, its debts as they become due, or shall make a
general assignment for the benefit of creditors; the Borrower shall
voluntarily suspend transaction of its business; the Borrower or any
Subsidiary shall institute (or fail to controvert in a timely and
appropriate manner) a proceeding described in Section 7.01 (m) (i)
hereof, or (whether or not any such proceeding has been instituted)
shall consent to or acquiesce in any such order for relief, declaration,
finding or relief described therein; the Borrower or any Subsidiary of
the Borrower shall institute (or fail to controvert in a timely and
appropriate manner) a proceeding described in Section 7.01 (m)(ii)
hereof, or (whether or not any such proceeding has been instituted)
shall consent to or acquiesce in any such appointment or to the taking
of possession by any such custodian of all or any substantial part of
its property; the Borrower or, to the extent not permitted by Section
5.04 hereof, any Subsidiary of the Borrower shall dissolve, wind-up,
revoke or forfeit its charter (or other constituent documents) or
liquidate itself or any substantial part of its property or shall take
any action in furtherance of any of the foregoing.
7.02. Consequences of an Event of Default.
(a) If an Event of Default specified in subsections (a) through
(l) of Section 7.01 hereof shall occur and be continuing or shall exist, then,
in addition to all other rights and remedies which any Lender may have
hereunder or under any other Loan Document, at law, in equity or otherwise,
the Lenders shall be under no further obligation to make Loans hereunder, and
each Lender may be notice to the Borrower and the other Lenders, from time to
time do any or all of the following:
(i) Declare its Commitments terminated, whereupon such
Commitments will terminate and any Fees hereunder shall be immediately
due and payable without presentment, demand, protest or further notice
of any kind, all of which are hereby waived, and an action therefor
shall immediately accrue.
(ii) Declare the unpaid principal amount of its Loans, interest
accrued thereon and all other Obligations owing to it to be immediately
due and payable without presentment, demand, protest or further notice
of any kind, all of which are hereby waived, and an action therefor
shall immediately accrue.
(b) If an Event of Default specified in subsection (m) or (n) of
Section 7.01 hereof shall occur or exist, then in addition to all other rights
and remedies which any Lender may have hereunder or under any other Loan
Document, at law, in equity or otherwise, the Commitments shall automatically
terminate and the Lenders shall be under no further obligation to make Loans,
and the unpaid principal amount of the Loans, interest accrued thereon and all
other Obligations shall become immediately due and payable without
presentment, demand, protest or notice of any kind, all of which are hereby
waived, and an action therefor shall immediately accrue.
ARTICLE VIII
MISCELLANEOUS
8.01. Holidays. Whenever any payment or action to be made or
taken hereunder or under any other Loan Document shall be stated to be due on
a day which is not a Business Day, such payment or action shall be made or
taken on the next following Business Day and such extension of time shall be
included in computing interest or fees, if any, in connection with such
payment or action.
8.02. Records. The unpaid principal amount of the Loans owing to
each Lender, the unpaid interest accrued thereon, the interest rate or rates
applicable to such unpaid principal amount, the duration of such
applicability, each Lender's Revolving Credit Committed Amount, and the
accrued and unpaid Fees shall at all times be ascertained from the records of
such Lender, which shall be conclusive absent manifest error.
8.03. Amendments and Waivers. Neither this Agreement nor any
Loan Document may be amended, modified, supplemented or waived without the
consent of the Borrower and all Lenders. Any such amendment, modification,
supplement or waiver must be in writing and shall be effective only to the
extent set forth in such writing. Any Event of Default or Potential Default
waived or consented to in any such amendment, modification or supplement shall
be deemed to be cured and not continuing to the extent and for the period set
forth in such waiver or consent, but no such waiver or consent shall extend to
any other or subsequent Event of Default or Potential Default or impair any
right consequent thereto.
8.04. No Implied Waiver; Cumulative Remedies. No course of
dealing and no delay or failure of any Lender in exercising any right, power
or privilege under this Agreement or any other Loan Document shall affect any
other or future exercise thereof or exercise of any other right, power or
privilege; nor shall any single or partial exercise of any such right, power
or privilege or any abandonment or discontinuance of steps to enforce such a
right, power or privilege preclude any further exercise thereof or of any
other right, power or privilege. The rights and remedies of the Lenders under
this Agreement and any other Loan Document are cumulative and not exclusive of
any rights or remedies which any Lender would otherwise have hereunder or
thereunder, at law, in equity or otherwise.
8.05. Notices.
(a) Except to the extent otherwise expressly permitted hereunder
or thereunder, all notices, requests, demands, directions and other
communications (collectively "notices") under this Agreement or any Loan
Document shall be in writing (including telexed and facsimile transmission)
and shall be sent by first-class mail, or by nationally-recognized overnight
courier, or by telex or facsimile transmission (with confirmation in writing
mailed first-class or sent by such an overnight courier), or by personal
delivery. All notices shall be sent to the applicable party at the address
stated on the signature pages hereof in accordance with the last unrevoked
written direction from such party to the other parties hereto, in all cases
with postage or other charges prepaid. Any such properly given notice shall
be effective when received.
(b) Each Lender may rely on any notice (whether or not such
notice is made in a manner permitted or required by this Agreement or any Loan
Document) purportedly made by or on behalf of the Borrower, no Lender shall
have any duty to verify the identity or authority or any Person giving such
notice.
8.06. Expenses; Taxes; Indemnity.
(a) The Borrower agrees to pay or cause to be paid and to save
each Lender harmless against liability for the payment of all reasonable out-
of-pocket costs and expenses (including but not limited to reasonable fees and
expenses of counsel) incurred by such Lender from time to time arising from or
relating to (i) the negotiation, preparation, execution, delivery,
administration and performance of this Agreement and the other Loan Documents,
(ii) any requested amendments, modifications, supplements, waivers or consents
(whether or not ultimately entered into or granted) to this Agreement or any
Loan Document, and (iii) the enforcement or preservation of rights under this
Agreement or any Loan Document (including but not limited to any such costs or
expenses arising from or relating to (A) collection or enforcement of an
outstanding Loan or any other amount owing hereunder or thereunder by such
Lender, and (B) any litigation, proceeding, dispute, work-out, restructuring
or rescheduling related in any way to this Agreement or the Loan Documents).
(b) The Borrower hereby agrees to pay all stamp, document,
transfer, recording, filing, registration, search, sales and excise fees and
taxes and all similar impositions now or hereafter determined by any Lender to
be payable in connection with this Agreement or any other Loan Documents or
any other documents, instruments or transactions pursuant to or in connection
herewith or therewith, and the Borrower agrees to save each Lender harmless
from and against any and all present or future claims, liabilities or losses
with respect to or resulting from any omission to pay or delay in paying any
such fees, taxes or impositions.
(c) The Borrower hereby agrees to reimburse and indemnify each of
the Indemnified Parties from and against any and all losses, liabilities,
claims, damages, expenses, obligations, penalties, actions, judgments, suits,
costs or disbursements of any kind or nature whatsoever (including, without
limitation, the fees and disbursements of counsel for such Indemnified Party
in connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnified Party shall be
designated a party thereto) that may at any time be imposed on, asserted
against or incurred by such Indemnified Party as a result of, or arising out
of, or in any way related to or by reason of, this Agreement or any other Loan
Document, any transaction from time to time contemplated hereby or thereby, or
any transaction financed in whole or in part of directly or indirectly with
the proceeds of any Loan (and without in any way limiting the generality of
the foregoing, including any violation or breach of any Environmental Law or
any other Law by the Borrower or any Subsidiary of the Borrower or any
Environmental Affiliate of any of them; any Environmental Claim arising out of
the management, use, control, ownership or operation of property by any of
such Persons, including all on-site and off-site activities involving
Environmental Concern Materials; any grant of collateral; or any exercise by
any Lender of any of its rights or remedies under this Agreement or any other
Loan Document); but excluding any such losses, liabilities, claims, damages,
expenses, obligations, penalties, actions, judgments, suits, costs or
disbursements resulting solely from the gross negligence or willful misconduct
of such Indemnified Party, as finally determined by a court of competent
jurisdiction. If and to the extent that the foregoing obligations of the
Borrower under this subsection (c), or any other indemnification obligation of
the Borrower hereunder or under any other Loan Document, are unenforceable for
any reason, the Borrower hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under
applicable Law.
8.07. Severability. The provisions of this Agreement are
intended to be severable. If any provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction such
provision shall, as to such jurisdiction, be ineffective to the extent of such
invalidity or unenforceability without in any manner affecting the validity or
enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
8.08. Prior Understandings. This Agreement and the other Loan
Documents supersede all prior and contemporaneous understandings and
agreements, whether written or oral, among the parties hereto relating to the
transactions provided for herein and therein.
8.09. Duration; Survival. All representations and warranties of
the Borrower contained herein or in any other Loan Document or made in
connection herewith or therewith shall survive the making of, and shall not be
waived by the execution and delivery, of this Agreement or any other Loan
Document, any investigation by or knowledge of any Lender, the making of any
Loan, or any other event or condition whatever. All covenants and agreements
of the Borrower contained herein or in any other Loan Document shall continue
in full force and effect from and after the date hereof so long as the
Borrower may borrow hereunder and until payment in full of all Obligations.
Without limitation, all obligations of the Borrower hereunder or under any
other Loan Document to make payments to or indemnify any Lender shall survive
the payment in full of all other Obligations, termination of the Borrower's
rights to borrow hereunder, and all other events and conditions whatever.
8.10. Counterparts. This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts
each of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument.
8.11. Limitation on Payments. The parties hereto intend to
conform to all applicable Laws in effect from time to time limiting the
maximum rate of interest that may be charged or collected. Accordingly,
notwithstanding any other provision hereof or of any other Loan Document, the
Borrower shall not be required to make any payment to or for the account of
any Lender, and each Lender shall refund any payment made by the Borrower, to
the extent that such requirement or such failure to refund would violate or
conflict with non-waiveable provisions of applicable Laws limiting the maximum
amount of interest which may be charged or collected by such Lender.
8.12. Set-Off. The Borrower hereby agrees that, to the fullest
extent permitted by Law, if any Obligation of the Borrower shall be due and
payable (by acceleration or otherwise), each Lender shall have the right,
without notice to the Borrower, to set-off against and to appropriate and
apply to such Obligation any indebtedness, liability or obligation of any
nature owing to the Borrower by such Lender, including but not limited to all
deposits (whether time or demand, general or special, provisionally credited
or finally credited, whether or not evidenced by a certificate of deposit) now
or hereafter maintained by the Borrower with such Lender. Such right shall be
absolute and unconditional in all circumstances and, without limitation, shall
exist whether or not such Lender or any other Person shall have given notice
or made any demand to the Borrower or any other Person, whether such
indebtedness, obligation or liability owed to the Borrower is contingent,
absolute, matured or unmatured (it being agreed that such Lender may deem such
indebtedness, obligation or liability to be then due and payable at the time
of such setoff), and regardless of the existence or adequacy of any
collateral, guaranty or any other security, right or remedy available to any
Lender or any other Person. The Borrower hereby agrees that, to the fullest
extent permitted by Law, any Participant and any branch, subsidiary or
affiliate of any Lender or any Participant shall have the same rights of set-
off as a Lender is provided in this Section (regardless of whether such
Participant, branch, subsidiary or affiliate would otherwise be deemed in
privity with or a direct creditor of the Borrower). The rights provided by
this Section are in addition to all other rights of set-off and bankers' liens
and all other rights and remedies which any Lender (or any such Participant,
branch, subsidiary or affiliate) may otherwise have under this Agreement, any
other Loan Document, at law or in equity, or otherwise, and nothing in this
Agreement or any Loan Document shall be deemed a waiver or prohibition of or
restriction on the right of set-off or bankers' lien of any such Person.
8.13. Sharing of Collections. The Lenders hereby agree among
themselves that if any Lender shall receive (by voluntary payment, realization
upon security, set-off or from any other source) any amount on account of the
Loans, interest thereon, or any other Obligation contemplated by this
Agreement or the other Loan Documents to be made by the Borrower Pro Rata to
all Lenders (or Pro Rata to holders of Notes of a particular type) in greater
proportion than any such amount received by any other Lender, then the Lender
receiving such proportionately greater payment shall notify each other Lender
of such receipt, and equitable adjustment will be made in the manner stated in
this Section so that, in effect, all such excess amounts will be shared
ratably among all of the Lenders. The Lender receiving such excess amount
shall purchase (which it shall be deemed to have done simultaneously upon the
receipt of such excess amount) for cash from the other Lenders a participation
in the applicable Obligations owed to such other Lenders in such amount as
shall result in a ratable sharing by all Lenders of such excess amount (and to
such extent the receiving Lender shall be a Participant). If all or any
portion of such excess amount is thereafter recovered from the Lender making
such purchase, such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, together with interest or other
amounts, if any, required by Law to be paid by the Lender making such
purchase. The Borrower hereby consents to and confirms the foregoing
arrangements. Each Participant shall be bound by this Section as fully as if
it were a Lender hereunder.
8.14. Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the Borrower, the Lenders, all future holders of
the Notes, and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights hereunder or interests
herein without the prior written consent of all the Lenders, and any purported
assignment without such consent shall be void.
(b) Participations. Any Lender may, in the ordinary course of
its commercial banking business and in accordance with applicable Law, at any
time sell participations to one or more commercial banks or other Persons
(each a "Participant") in all or a portion of its rights and obligations under
this Agreement and the other Loan Documents (including, without limitation,
all or a portion of its Commitments and the Loans owing to it and any Note
held by it); provided, that
(i) any such participation shall be in a minimum aggregate
principal amount of $5,000,000 of the Commitments and Loans then
outstanding;
(ii) any such Lender's obligations under this Agreement and the
other Loan Documents shall remain unchanged,
(iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations,
(iv) the parties hereto shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and each of the other Loan Documents,
(v) such Participant shall be bound by the provisions of Section
8.13 hereof, and
(vi) no Participant (unless such Participant is an affiliate of
such Lender, or is itself a Lender) shall be entitled to require such
Lender to take or refrain from taking action under this Agreement or
under any other Loan Document, except that such Lender may agree with
such Participant that such Lender will not, without such Participant's
consent, take action (A) to increase such Lender's Revolving Credit
Committed Amount, over the amount thereof then in effect, or extend the
Maturity Date, or (B) reduce the principal amount of or extend the
scheduled final maturity of any of such Lender's Loans, or reduce the
rate of interest or extend the time for payment of interest borne by any
such Loan or extend the time for payment of or reduce the amount of any
Fees or reduce or postpone the date for payment of any other fees,
expenses, indemnities or amounts payable under any Loan Document.
The Borrower agrees that any such Participant shall be entitled to the
benefits of Sections 2.10, 2.11 and 8.06 with respect to its participation in
the Commitments and the Loans outstanding from time to time; provided, that no
such Participant shall be entitled to receive any greater amount pursuant to
such Sections than the transferor Lender would have been entitled to receive
in respect of the amount of the participation transferred to such Participant
had no such transfer occurred.
(c) Assignments. Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable Law, at any time
assign all or a portion of its rights and obligations under this Agreement and
the other Loan Documents (including, without limitation, all or any portion of
its Commitments and Loans owing to it and any Note held by it) to any Lender,
any affiliate of a Lender or to one or more additional commercial banks or
other Persons (each a "Purchasing Lender"); provided, that
(i) any such assignment to a Purchasing Lender which is not a
Lender or an affiliate of a Lender shall be made only with the consent
of the Borrower (which consent shall not be unreasonably withheld),
except no such consent shall be required after the occurrence of an
Event of Default under Sections 7.01 (m) or (n) hereof,
(ii) if a Lender makes such an assignment of less than all of its
then remaining rights and obligations under this Agreement and the other
Loan Documents, such transferor Lender shall retain, after such
assignment, a minimum principal amount of $10,000,000 of the Commitments
and Loans then outstanding, and such assignment shall be in a minimum,
aggregate principal amount of $5,000,000 of the Commitments and Loans
then outstanding,
(iii) each such assignment shall be of a constant, and not a
varying, percentage of each Commitment of the transferor Lender and of
all of the transferor Lender's rights and obligations under this
Agreement and the other Loan Documents, and
(iv) each such assignment shall be made pursuant to a Transfer
Supplement in substantially the form of Exhibit G to this Agreement,
duly completed (a "Transfer Supplement").
Notwithstanding the foregoing, any Lender assigning its rights and
obligations under this Agreement may retain any Bid Loans made by it
outstanding at such time, and in such case shall retain its rights
hereunder in respect of any Bid Loans so retained until such Bid Loans
have been repaid in full in accordance with this Agreement.
In order to effect any such assignment, the transferor Lender and the
Purchasing Lender shall execute and deliver to the Borrower a duly completed
Transfer Supplement (including the consents required by clause 8.14 (c) (i)
with respect to such assignment, together with any Note or Notes subject to
such assignment (the "Transferor Lender Notes"). Upon such execution and
delivery from and after the close of business on the Transfer Effective Date
specified in such Transfer Supplement
(x) the Purchasing Lender shall be a party hereto and, to the
extent provided in such Transfer Supplement, shall have the rights and
obligations of a Lender hereunder; provided, as of the Transfer
Effective Date, such Purchasing Lender shall not be entitled to receive
in respect of the amount of the Loans and Commitments transferred to
such Purchasing Lender any amount under Section 2.11 that is greater
than the amount which the transferor Lender would have been entitled to
receive had no such transfer occurred (although it may receive such
greater amounts after the Transfer Effective Date if the right to
receive such greater amounts arises as a result of circumstances not
existing on the Transfer Effective Date), and
(y) the transferor Lender thereunder shall be released from its
obligations under this Agreement to the extent so transferred (and, in
the case of a Transfer Supplement covering all or the remaining portion
of a transferor Lender's rights and obligations under this Agreement,
such transferor Lender shall cease to be a party to this Agreement) from
and after the Transfer Effective Date, except that such transferor
Lender shall continue to be entitled to the benefits of Sections 2.10,
2.11 and 8.06 hereof with respect to its activities as a Lender prior to
the Transfer Effective Date.
On or prior to the Transfer Effective Date specified in a Transfer Supplement,
the Borrower, at its expense, shall execute and deliver to the Purchasing
Lender new Notes evidencing such Purchasing Lender's assigned Commitments or
Loans and to the transferor Lender replacement Notes evidencing the Loans or
Commitments retained by the transferor Lender (such Notes to be in exchange
for, but not in payment of, those Notes then held by such transferor Lender).
Each such Note shall be dated the date and be substantially in the form of the
predecessor Note. The Transferor Lender shall mark the predecessor Notes
"exchanged" and deliver them to the Borrower. Accrued interest and accrued
fees shall be paid to the Purchasing Lender at the same time or times provided
in the predecessor Notes and this Agreement.
(d) Financial and Other Information. The Borrower authorizes
each Lender to disclose, subject to the provisions of Section 8.16 hereof, to
any Participant or Purchasing Lender (each, a "transferee") and any
prospective transferee any and all financial and other information in such
Person's possession concerning the Borrower and its Subsidiaries and
Affiliates which has been or may be delivered to such Person by or on behalf
of the Borrower in connection with this Agreement or any other Loan Document
or such Person's credit evaluation of the Borrower and its Subsidiaries and
Affiliates.
(e) Assignments to Federal Reserve Bank. Any Lender may at any
time assign all or any portion of its rights under this Agreement, including
without limitation any Loans owing to it, and any Note held by it to a Federal
Reserve Bank. No such assignment shall relieve the transferor Lender from its
obligations hereunder.
8.15. Relationship Among the Lenders. No Lender is making any
representation or warranty to any other Lender or the Borrower and assumes no
responsibility with respect to (a) the execution, delivery, effectiveness,
enforceability, genuineness, validity or adequacy of this Agreement or any
other Loan Document, (b) any recital, representation, warranty, document,
certificate, report or statement in, provided for in, received under or in
connection with, this Agreement or any other Loan Document, (c) the
performance or observance of any of the terms or conditions of this Agreement
or any other Loan Document on the part of the Borrower, (d) the business,
operations, condition (financial or otherwise) or prospects of the Borrower or
any other Person, or (e) the existence of any Event of Default or Potential
Default. Each Lender confirms that it has made its own credit analysis and
decision independently and without reliance upon any other Lender and, based
on such documents and information as it shall deem appropriate at the time,
will make its own decisions to take or not take action under or in connection
with this Agreement or any other Loan Document. No Lender is acting as the
agent for any other Lender hereunder or under any other Loan Document.
8.16. Confidentiality. Each Lender, each Participant, each
Purchasing Lender and each subsequent holder of any Note by acceptance thereof
shall be deemed to agree that any and all information of any kind (whether
written or oral) obtained pursuant to this Agreement that shall not then be or
have become generally available to the public, shall be kept and maintained in
strictest confidence, and shall not be disclosed or disseminated to any other
party, except (a) to any regulatory agency having apparent authority to
examine the loan portfolio, books and records of such Lender, Participant,
Purchasing Lender or any such subsequent holder, (b) in response to any
subpoena or other appropriate legal process to which such Lender, Participant,
Purchasing Lender or any such subsequent holder is subject, (c) pursuant to
any Law or regulation, (d) to outside accountants, lawyers or other
professionals employed by such Lender, Participant, Purchasing Lender or any
such subsequent holder in connection with this Agreement who agree to observe
these restrictions on confidentiality, and (e) to any prospective Participant
or transferee of any Note which agrees to observe these restrictions on
confidentiality.
8.17. Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial; Limitation of Liability.
(a) Governing Law. THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS
(EXCEPT TO THE EXTENT, IF ANY, OTHERWISE EXPRESSLY STATED IN SUCH OTHER LOAN
DOCUMENTS) SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA, WITHOUT REGARD TO CHOICE OF LAW
PRINCIPLES.
(b) Certain Waivers. THE BORROWER HEREBY IRREVOCABLY AND
UNCONDITIONALLY:
(i) AGREES THAT ANY ACTION, SUIT OR PROCEEDING BY ANY PERSON
ARISING FROM OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR
ANY STATEMENT, COURSE OF CONDUCT, ACT, OMISSION, OR EVENT OCCURRING IN
CONNECTION HEREWITH OR THEREWITH (COLLECTIVELY, "RELATED LITIGATION")
MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION
SITTING IN ALLEGHENY COUNTY, PENNSYLVANIA, SUBMITS TO THE JURISDICTION
OF SUCH COURTS, AND TO THE FULLEST EXTENT PERMITTED BY LAW AGREES THAT
IT WILL NOT BRING ANY RELATED LITIGATION IN ANY OTHER FORUM (BUT NOTHING
HEREIN SHALL AFFECT THE RIGHT OF ANY LENDER TO BRING ANY ACTION, SUIT OR
PROCEEDING IN ANY OTHER FORUM);
(ii) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE
LAYING OF VENUE OF ANY RELATED LITIGATION BROUGHT IN ANY SUCH COURT,
WAIVES ANY CLAIM THAT ANY SUCH RELATED LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM, AND WAIVES ANY RIGHT TO OBJECT, WITH RESPECT TO ANY
RELATED LITIGATION BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES NOT
HAVE JURISDICTION OVER THE BORROWER;
(iii) CONSENTS AND AGREES TO SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER LEGAL PROCESS IN ANY RELATED LITIGATION BY REGISTERED OR CERTIFIED
U.S. MAIL, POSTAGE PREPAID, TO THE BORROWER AT THE ADDRESS FOR NOTICES
DESCRIBED IN SECTION 8.05 HEREOF, AND CONSENTS AND AGREES THAT SUCH
SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE
(BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS OF
PROCESS SERVED IN ANY OTHER MANNER PERMITTED BY LAW); AND
(iv) WAIVES THE RIGHT TO TRIAL BY JURY IN ANY RELATED LITIGATION.
(c) Limitation of Liability. TO THE FULLEST EXTENT PERMITTED BY
LAW, NO CLAIM MAY BE MADE BY THE BORROWER AGAINST ANY LENDER OR ANY AFFILIATE,
DIRECTOR, OFFICER, EMPLOYEE, ATTORNEY OR AGENT OF ANY OF THEM FOR ANY SPECIAL,
INCIDENTAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT OF ANY
CLAIM ARISING FROM OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR
ANY STATEMENT, COURSE OF CONDUCT, ACT, OMISSION, OR EVENT OCCURRING IN
CONNECTION HEREWITH OR THEREWITH (WHETHER FOR BREACH OF CONTRACT, TORT OR ANY
OTHER THEORY OF LIABILITY). THE BORROWER HEREBY WAIVES, RELEASES AND AGREES
NOT TO SUE UPON ANY CLAIM FOR ANY SUCH DAMAGES, WHETHER SUCH CLAIM PRESENTLY
EXISTS OR ARISES HEREAFTER AND WHETHER OR NOT SUCH CLAIM IS KNOWN OR SUSPECTED
TO EXIST IN ITS FAVOR.
8.18. Judgment Currency. (a) The specification in this Agreement
and in the other Loan Documents of payment in Dollars or an Alternate Currency
at the Lender's Payment Offices is of the essence hereof and thereof. If any
court or tribunal shall render a judgment or order for the payment of any
amounts owing to any Lender under this Agreement or any other Loan Document or
for the payment of damages in respect of any breach of this Agreement or any
other Loan Document or under or in respect of a judgment or order of another
court or tribunal for payment of such amounts or damages, and if such judgment
or order is expressed in a currency (the "Judgment Currency") other than the
currency payable hereunder (the "Contractual Currency"), the Borrower shall
indemnify and hold harmless each Lender against any deficiency in terms of the
Contractual Currency in the amounts received by such Lender arising or
resulting from any variation as between (i) the rate of exchange at which the
Contractual Currency is converted into the Judgment Currency for the purposes
of such judgment or order and (ii) the rate of exchange at which such Lender
would, in accordance with normal banking procedures, be able to purchase the
Contractual Currency with the amount of the Judgment Currency actually
received by such Lender on the London Business Day following such receipt by
such Lender.
(b) If the Borrower shall wind up, liquidate, dissolve or become
bankrupt while there remains outstanding any amounts owing to any Lender under
this Agreement or any other Loan Document or any damages owing to any Lender
in respect of a breach of this Agreement or any other Loan Document or any
judgment or order rendered in respect of such amounts or damages, the Borrower
shall indemnify and hold each Lender harmless against any deficiency in terms
of the Contractual Currency in the amounts received by such Lender arising or
resulting from any variation as between (i) the rate of exchange at which the
Contractual Currency is converted into another currency (the "Liquidation
Currency") for purposes of such winding-up, liquidation, dissolution or
bankruptcy with regard to the amount in the Contractual Currency due or
contingently due under this Agreement or any other Loan Document (other than
this Section 8.18 (b)), or under any judgment or order into which the relevant
obligations under this Agreement or any other Loan Document shall have been
merged and (ii) the rate of exchange at which such Lender could, in accordance
with normal banking procedures, be able to purchase the Contractual Currency
with the Liquidation Currency at the earlier of (A) the date of payment of
such amounts or damages and (B) the final date or dates for the filing of
proofs of a claim in such winding-up, liquidation, dissolution or bankruptcy.
As used in the preceding sentence, the "final date or dates for the filing of
proofs of a claim in a winding-up, liquidation, dissolution or bankruptcy"
shall be the date fixed by the liquidator or other appropriate person or
otherwise applicable under applicable Law as being the last practicable date
as of which the liabilities of the Borrower may be ascertained for such
winding-up, liquidation, dissolution or bankruptcy before payment by the
liquidator or other appropriate person is respect thereof.
(c) The indemnities provided by Sections 8.18 (a) and (b) hereof
shall constitute obligations of the Borrower separate and independent from its
other obligations under this Agreement and the other Loan Document, shall give
rise to separate and independent causes of action against the Borrower, shall
apply irrespective of any indulgence granted by any Lender from time to time
and shall continue in full force and effect notwithstanding any judgment or
order or the filing of any proof or proofs in the winding-up, liquidation,
dissolution or bankruptcy of the Borrower for a liquidated sum or sums in
respect of other amounts due under this Agreement or any other Loan Document
or any damages owing to any Lender in respect of a breach of this Agreement or
any other Loan Document or any judgment rendered in respect of such amounts or
damages.
IN WITNESS WHEREOF, the parties hereto, by their officers
thereunto duly authorized, have executed and delivered this Agreement as of
the date first above written.
Attest: KENNAMETAL INC.
/s/ DAVID T. COFER By: /s/ JAMES E. MORRISON
- -------------------------------- -----------------------------------
Title: Vice President, Secretary Title: Vice President and Treasurer
and General Counsel
Address for Notices:
Route 981 South near Westmoreland
County Airport
Latrobe, PA l5650
Attn: Treasurer
Telephone: (412) 539-5180
Telecopier: (412) 539-4668
MELLON BANK, N.A.
By: /s/ MARTIN T. HANNING
---------------------
Title: Vice President
Initial Revolving Credit
Committed Amount : $30,000,000
Address for Notices:
Domestic Lending Office:
Eurocurrency Lending Office:
Mellon Bank, N.A.
Three Mellon Bank Center
153-2302
Pittsburgh, PA 15259
Attn: Patricia Martin
Telephone: (412) 234-4710
Telecopier: (412) 236-2028
PNC BANK, NATIONAL ASSOCIATION
By: s/s LAWRENCE W. JACOBS
----------------------
Title: Vice President
Initial Revolving Credit
Committed Amount: $30,000,000
Address for Notices:
Domestic Lending Office:
Eurocurrency Lending Office:
PNC Bank, National Association
One PNC Plaza
Fifth Avenue and Wood Street
Pittsburgh, PA 15265
Attn: Kennametal Relationship Manager
Telephone: (412) 762-2524
Telex: 866 533
Telecopier: (412) 762-6484
DEUTSCHE BANK AG, New York Branch
and/or Cayman Islands Branch
By: s/s STEPHAN A. WIEDEMAN
-----------------------
Title: Vice President
By: s/s HANS-JOSEF THIELE
-----------------------
Title: Vice President
Initial Revolving Credit
Committed Amount: $30,000,000
Address for Notices:
Domestic Lending Office;
Eurocurrency Lending Office:
Deutsche Bank AG, New York Branch
31 West 52nd Street
New York NY 10019
Attn: Kennametal Relationship Manager
Corporate Finance-Domestic
Attn: Mr. R-P Mikolayczyk
Telephone: (212) 474-8237
Telex: 429 166
(Answerback: DEUTBKNY)
Telecopier: (212) 474-8212
46