EXHIBIT 10.2
EXECUTION COPY
$100,000,000
CREDIT AGREEMENT
Dated as of July 12, 1996
Among
PSC ACQUISITION, INC.
as Borrower
and
PSC INC.
as Guarantor
and
THE INITIAL LENDERS
NAMED HEREIN
as Initial Lenders
FLEET BANK
as Initial Issuing Bank,
and
FLEET BANK
as Administrative Agent
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms......................................... 2
1.02. Computation of Time Periods................................... 27
1.03. Accounting Terms.............................................. 27
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
2.01. The Advances.................................................. 27
2.02. Making the Advances........................................... 29
2.03. Issuance of and Drawings and
Reimbursement Under Letters of Credit ..................... 31
2.04. Repayment of Advances......................................... 33
2.05. Termination or Reduction of the Commitments................... 36
2.06. Prepayments................................................... 36
2.07. Interest...................................................... 39
Section Page
2.08. Fees.......................................................... 40
2.09. Conversion of Advances........................................ 40
2.10. Increased Costs, Etc.......................................... 41
2.11. Payments and Computations..................................... 43
2.12. Taxes......................................................... 44
2.13. Sharing of Payments, Etc...................................... 46
2.14. Use of Proceeds............................................... 47
2.15. Defaulting Lenders............................................ 47
ARTICLE III
CONDITIONS OF LENDING
3.01. Conditions Precedent to Initial Extension of Credit........... 49
3.02. Conditions Precedent to Each Borrowing and Issuance........... 57
3.03. Determinations Under Section 3.01............................. 58
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of PSC and the Borrower........ 58
Section Page
ARTICLE V
COVENANTS OF PSC AND THE BORROWER
5.01. Affirmative Covenants......................................... 65
5.02. Negative Covenants............................................ 70
5.03. Reporting Requirements........................................ 77
5.04. Financial Covenants........................................... 81
ARTICLE VI
EVENTS OF DEFAULT
6.01. Events of Default............................................. 84
6.02. Actions in Respect of the Letters of Credit upon Default...... 88
ARTICLE VII
The Administrative Agent
7.01. Authorization and Action...................................... 88
7.02. Administrative Agent's Reliance, Etc.......................... 88
7.03. Fleet and Affiliates.......................................... 89
7.04. Lender Party Credit Decision.................................. 89
Section Page
7.05. Indemnification............................................... 89
7.06. Successor Administrative Agents............................... 91
ARTICLE VIII
MISCELLANEOUS
8.01. Amendments, Etc............................................... 92
8.02. Notices, Etc.................................................. 93
8.03. No Waiver; Remedies........................................... 93
8.04. Costs and Expenses............................................ 93
8.05. Right of Set-off.............................................. 95
8.06. Binding Effect................................................ 95
8.07. Assignments and Participations................................ 95
8.08. Execution in Counterparts..................................... 98
8.09. No Liability of the Issuing Bank.............................. 98
8.10. Confidentiality............................................... 99
8.11. Jurisdiction, Etc............................................. 99
8.12. Governing Law................................................. 99
8.13. Waiver of Jury Trial.......................................... 99
ARTICLE IX
Section Page
PSC GUARANTY
9.01. PSC Guaranty..................................................100
9.02. Guaranty Absolute.............................................100
9.03. Waivers and Acknowledgments...................................101
9.04. Subrogation...................................................102
9.05. Continuing Guarantee; Assignments.............................102
SCHEDULES
Schedule I ................... Commitments and Applicable Lending Offices
Schedule II .................. Foreign Subsidiaries
Schedule III ................. Pro Forma EBITDA
Schedule 3.01(g) ............. Disclosed Litigation
Schedule 3.01(k) ............. Hedge Agreements
Schedule 3.01(l)(vi) ......... States in which Loan Parties are
Qualified to do Business
Schedule 3.01(l)(xi) ......... Mortgages
Schedule 3.01 (l)(xvii) ...... Environmental Assessment Reports
Schedule 4.01(b) ............. Subsidiaries
Schedule 4.01(d) ............. Required Authorizations and Approvals
Schedule 4.01(n) ............. Plans, Multiemployer Plans and Welfare Plans
Schedule 4.01(w) ............. Open Tax Years
Schedule 4.01(dd) ............ Existing Debt (other than Surviving Debt)
Schedule 4.01(ee) ............ Surviving Debt
Schedule 4.01(ff) ............ Owned Real Estate
Schedule 4.01(gg) ............ Leased Real Estate
Schedule 4.01(hh) ............ Material Contracts
Schedule 4.01(ii) ............ Investments
Schedule 4.01(jj) ............ Intellectual Property
Schedule 5.02(a)(iii) ........ Liens
EXHIBITS
Exhibit A-1 .................. Form of Term A Note
Exhibit A-2 .................. Form of Term B Note
Exhibit A-3 .................. Form of Working Capital Note
Exhibit B .................... Form of Notice of Borrowing
Exhibit C .................... Form of Assignment and Acceptance
Exhibit D .................... Form of Security Agreement
Exhibit E .................... Form of Intellectual Property Security Agreement
Exhibit F-1 .................. Form of New York Mortgage
Exhibit F-2 .................. Form of Oregon Deed of Trust
Exhibit G .................... Form of Subsidiary Guaranty
Exhibit H .................... Form of Assumption Agreement
Exhibit I .................... Form of Solvency Certificate
Exhibit J .................... Form of Opinion of Borrower's Counsel
Exhibit K .................... Form of Opinion of Local Counsel Opinion
Exhibit L .................... Form of Opinion of Intellectual Property Counsel
Exhibit M .................... Form of Borrowing Base Certificate
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of July 12, 1996 among PSC Acquisition, Inc., a
Delaware corporation ("PSC Acquisition" and, together with the Surviving
Corporation (as hereinafter defined) following the Merger (as hereinafter
defined), the "Borrower"), PSC Inc., a New York corporation ("PSC"), as
Guarantor, the banks, financial institutions and other institutional lenders
listed on the signature pages hereof as the Initial Lenders (the "Initial
Lenders"), the Initial Issuing Bank (as hereinafter defined) (the "Initial
Issuing Bank"), the Swing Line Bank (as hereinafter defined), Fleet Bank
("Fleet"), as administrative agent (together with any successor appointed
pursuant to Article VII, the "Administrative Agent") for the Lender Parties (as
hereinafter defined).
PRELIMINARY STATEMENTS:
(1) PSC Acquisition was organized by PSC to acquire certain assets and
businesses of Spectra-Physics, Inc., a Delaware corporation (the "Company"),
Spectra-Physics Scanning Systems, Inc., a Delaware corporation ("Scanning") and
T.X.C.O.M., S.A., a French corporation ("TxCom") and other related assets.
(2) Pursuant to the Asset and Stock Purchase Agreement dated May 20, 1996
(as amended, supplemented or otherwise modified in accordance with its terms, to
the extent permitted in accordance with the Loan Documents (as hereinafter
defined), the "Purchase Agreement") by and among PSC, Spectra-Physics Holdings,
S.A., a French corporation ("SP Holdings") and the Company, PSC has agreed to
purchase, both directly and through PSC Acquisition and other direct
wholly-owned Subsidiaries (as hereinafter defined) certain assets and businesses
of the Company. Simultaneously with such purchase, PSC Acquisition will
consummate a merger (the "Merger") with Scanning, in which Scanning will be the
surviving corporation (the "Surviving Corporation"). Upon the consummation of
the Merger, the name of the Surviving Corporation will be changed to
SpectraScan, Inc.
(3) The Borrower has requested that the Lender Parties lend to the Borrower
up to $92,500,000 of the total Commitments (as hereinafter defined) to pay to
the Company the cash consideration for the assets and businesses of the Company
that PSC and its direct wholly-owned Subsidiaries are purchasing, pay
transaction fees and expenses, and that, from time to time, the Lender Parties
lend the remaining balance of the total Commitments to the Borrower and issue
Letters of Credit for the benefit of the Borrower to provide working capital for
the Borrower and its Subsidiaries. The Lender Parties have indicated their
willingness to agree to lend such amounts on the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
Article I
Definitions And Accounting Terms
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Acquired Assets and Liabilities" means the Scanning Shares, the US
Assets, the TxCom Assets and Liabilities and the International Assets and
Liabilities (each as defined in the Purchase Agreement).
"Acquisition" means the transactions contemplated by the Purchase
Agreement.
"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent with Fleet at
its office at One East Avenue, Rochester, New York 14638, Account No.
1983580, Attention: Jeffrey Kenefick.
"Advance" means a Term A Advance, a Term B Advance, a Working Capital
Advance, a Swing Line Advance or a Letter of Credit Advance.
"Affiliate" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control with
such Person or is a director or officer of such Person. For purposes of
this definition, the term "control" (including the terms "controlling,"
"controlled by" and "under common control with") of a Person means the
possession, direct or indirect, of the power to vote 5% or more of the
Voting Stock of such Person or to direct or cause the direction of the
management and policies of such Person, whether through the ownership of
Voting Stock, by contract or otherwise.
"Applicable Lending Office" means, with respect to each Lender Party,
such Lender Party's Domestic Lending Office in the case of a Prime Rate
Advance and such Lender Party's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
"Applicable Margin" means at any time and from time to time (a) with
respect to the Term B Facility 1.75% per annum for Prime Rate Advances and
3.25% per annum for Eurodollar Rate Advances and (b) with respect to the
Term A Facility and the Working Capital Facility, (i) prior to July 1,
1997, 1.25% per annum for Prime Rate Advances and 2.75% per annum for
Eurodollar Rate Advances and (ii) from and after July 1, 1997, a percentage
per annum determined by reference to the Total Debt Ratio as set forth
below:
Term A Facility and
Working Capital Term A Facility and Working
Total Debt Facility Capital Facility
Ratio Prime Rate Advances Eurodollar Rate Advances
Level I:
a ratio greater than 1.25% 2.75%
3.5:1
Level II:
a ratio of
3.5:1 or less
but at least 3.0:1 1.00% 2.50%
Level III:
a ratio of less than
3.0:1 but at least 2.5:1 .75% 2.25%
Level IV:
a ratio of less than
2.5:1 .50% 2.00%
The Applicable Margin for each Prime Rate Advance shall be determined by
reference to the ratio in effect from time to time and the Applicable
Margin for each Eurodollar Rate Advance shall be determined by reference to
the ratio in effect on the first day of each Interest Period for such
Advance; provided, however, that (A) no change in the Applicable Margin
shall be effective until three Business Days after the date on which the
Administrative Agent receives financial statements pursuant to
Section 5.03(c) or (d) and a certificate of the chief financial officer of
PSC demonstrating such ratio and (B) if PSC has not submitted to the
Administrative Agent the information described in clause (A) of this
proviso as and when required under Section 5.03(c) or (d), as the case may
be, the Applicable Margin shall be at Level I for so long as such
information has not been received by the Administrative Agent.
"Appropriate Lender" means, at any time, with respect to (a) any of
the Term A Facility, the Term B Facility or the Working Capital Facility, a
Lender that has a Commitment with respect to such Facility at such time,
(b) the Letter of Credit Facility, (i) the Issuing Bank and (ii) if the
other Working Capital Lenders have made Letter of Credit Advances pursuant
to Section 2.03(c) that are outstanding at such time, each such other
Working Capital Lender and (c) the Swing Line Facility, (i) the Swing Line
Bank and (ii) if the other Working Capital Lenders have made Swing Line
Advances pursuant to Section 2.02(b) that are outstanding at such time,
each such other Working Capital Lender.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender Party and an Eligible Assignee, and accepted by the
Administrative Agent, in accordance with Section 8.07 and in substantially
the form of Exhibit C hereto.
"Assumption Agreement" has the meaning specified in Section
3.01(l)(xiv).
"Available Amount" of any Letter of Credit means, at any time, the
maximum amount available to be drawn under such Letter of Credit at such
time (assuming compliance at such time with all conditions to drawing).
"Bank Hedge Agreement" means any interest rate Hedge Agreement
required or permitted under Article V that is entered into by and between
the Borrower and any Lender Party.
"Bond Trustee" means The Oregon Bank in its capacity as trustee under
the IRB Documents.
"Borrower" has the meaning specified in the recital of parties to this
Agreement.
"Borrower's Account" means the account of the Borrower maintained by
the Borrower with M&T at its office at 44 Exchange Street, Rochester, New
York 14614, Account No. 15976632.
"Borrowing" means, a Term A Borrowing, a Term B Borrowing, a Working
Capital Borrowing or a Swing Line Borrowing.
"Borrowing Base" on any date means the sum of (x) 80% of the value of
the Eligible Receivables arising out of sales to account debtors within the
United States and (y) 60% of the value of the Eligible Receivables arising
out of sales to account debtors outside the United States, in each case as
set forth in the most recent Borrowing Base Certificate delivered to the
Administrative Agent pursuant to the terms of this Agreement on or prior to
such date.
"Borrowing Base Certificate" means a certificate in substantially the
form of Exhibit M hereto, duly certified by the chief financial officer of
the Borrower.
"Borrowing Base Deficiency" means, at any time, the failure of (a) the
Borrowing Base at such time to equal or exceed (b) the sum of (i) the
aggregate principal amount of the Working Capital Advances, the Letter of
Credit Advances and the Swing Line Advances outstanding at such time plus
(ii) the aggregate Available Amount under all Letters of Credit outstanding
at such time.
"Business Day" means a day of the year on which banks are not required
or authorized by law to close in Rochester, New York and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.
"Capital Expenditures" means, for any Person for any period, the sum
of all expenditures made, directly or indirectly, by such Person or any of
its Subsidiaries during such period for equipment, fixed assets, real
property or improvements, or for replacements or substitutions therefor or
additions thereto, that have been or should be, in accordance with GAAP,
reflected as additions to property, plant or equipment on a Consolidated
balance sheet of such Person.
"Capitalized Leases" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases.
"Cash Equivalents" means any of the following, to the extent owned by
the Borrower or any of its Subsidiaries free and clear of all Liens other
than Liens created under the Collateral Documents: (a) readily marketable
direct obligations of the Government of the United States or any agency or
instrumentality thereof or obligations unconditionally guaranteed by the
full faith and credit of the Government of the United States having a
maturity of not greater than 360 days from the date of issuance thereof,
(b) insured certificates of deposit of or time deposits having a maturity
of not greater than 360 days from the date of issuance thereof with any
commercial bank that is a Lender Party or a member of the Federal Reserve
System, issues (or the parent of which issues) commercial paper rated as
described in clause (c), is organized under the laws of the United States
or any State thereof and has combined capital and surplus of at least $1
billion or (c) commercial paper having a maturity of not greater than 180
days from the date of issuance thereof in an aggregate amount of no more
than $2,500,000 per issuer outstanding at any time, issued by any
corporation organized under the laws of any State of the United States and
rated at least "Prime-1" (or the then equivalent grade) by Moody's
Investors Service, Inc. or "A-1" (or the then equivalent grade) by
Standard & Poor's Ratings Group.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response, Compensation
and Liability Information System maintained by the U.S. Environmental
Protection Agency.
"Co-Arrangers" means Fleet and M&T.
"Collateral" means all "Collateral" referred to in the Collateral
Documents and all other property that is or is intended to be subject to
any Lien in favor of the Administrative Agent for the benefit of the
Secured Parties.
"COMIDA" means the County of Monroe Industrial Development Agency.
"Collateral Documents" means the Security Agreement, the Intellectual
Property Security Agreement, the Mortgages, and any other agreement that
creates or purports to create a Lien in favor of the Administrative Agent
for the benefit of the Secured Parties.
"Commitment" means a Term A Commitment, a Term B Commitment, a Working
Capital Commitment or a Letter of Credit Commitment.
"Commitment Fee Percentage" means at any time and from time to time
(a) prior to July 1, 1997, 0.50% per annum and (b) from and after July 1,
1997 a percentage per annum determined by reference to the Total Debt Ratio
as set forth below:
Total Debt Ratio Commitment Fee Percentage
Level I: ....................................... .50
a ratio of greater
than 3.5:1
Level II: ...................................... .50
a ratio of 3.5:1
or less but at least
3.0:1
Level III: ..................................... .375
a ratio of less than
3.0:1 but at least 2.5:1
Level IV: ...................................... .375
a ratio of less
than 2.5:1
; provided, however, that (A) no change in the Commitment Fee Percentage
shall be effective until three Business Days after the date on which the
Administrative Agent receives financial statements pursuant to Section
5.03(c) or (d) and a certificate of the chief financial officer of PSC
demonstrating such ratio and (B) if PSC has not submitted to the
Administrative Agent the information described in clause (A) of this
proviso as and when required under Section 5.03(c) or (d), as the case may
be, the Commitment Fee Percentage shall be at Level I for so long as such
information has not been received by the Administrative Agent.
"Company" has the meaning specified in the Preliminary Statements.
"Confidential Information" means information that the Borrower
furnishes to the Administrative Agent or any Lender Party in a writing
designated as confidential, but does not include any such information that
is or becomes generally available to the public other than as a result of a
breach by the Administrative Agent or any Lender Party of its obligations
hereunder or that is or becomes available to the Administrative Agent or
such Lender Party from a source other than the Borrower that is not, to the
best of the Administrative Agent's or such Lender Party's knowledge, acting
in violation of a confidentiality agreement with the Borrower.
"Consolidated" refers to the consolidation of accounts, in accordance
with GAAP, of PSC and all of its Subsidiaries.
"Conversion," "Convert" and "Converted" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to
Section 2.09 or 2.10.
"Current Assets" of any Person means all assets of such Person that
would, in accordance with GAAP, be classified as current assets of a
company conducting a business the same as or similar to that of such
Person, after deducting adequate reserves in each case in which a reserve
is proper in accordance with GAAP.
"Current Liabilities" of any Person means (a) all Debt of such Person
except Funded Debt that by its terms is payable on demand or matures within
one year after the date of determination (excluding any Debt renewable or
extendible, at the option of such Person, to a date more than one year from
such date or arising under a revolving credit or similar agreement that
obligates the lender or lenders to extend credit during a period of more
than one year from such date), (b) all amounts of Funded Debt of such
Person required to be paid or prepaid within one year after such date and
(c) all other items (including taxes accrued as estimated) that in
accordance with GAAP would be classified as current liabilities of such
Person.
"Debt" of any Person means, without duplication, (a) all indebtedness
of such Person for borrowed money, (b) all Obligations of such Person for
the deferred purchase price of property or services (other than trade
payables not overdue by more than 60 days incurred in the ordinary course
of such Person's business and trade payables that are being contested in
good faith), (c) all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all Obligations of such Person
created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property), (e)
all Obligations of such Person as lessee under Capitalized Leases, (f) all
Obligations, contingent or otherwise, of such Person under acceptance,
letter of credit or similar facilities, (g) all Obligations of such Person
to purchase, redeem, retire, defease or otherwise make any payment in
respect of any capital stock of or other ownership or profit interest in
such Person or any other Person or any warrants, rights or options to
acquire such capital stock, valued, in the case of Redeemable Preferred
Stock, at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends, (h) all Obligations of such
Person in respect of Hedge Agreements, (i) all Debt of others referred to
in clauses (a) through (h) above or clause (j) below guaranteed directly or
indirectly in any manner by such Person, or in effect guaranteed directly
or indirectly by such Person through an agreement (i) to pay or purchase
such Debt or to advance or supply funds for the payment or purchase of such
Debt, (ii) to purchase, sell or lease (as lessee or lessor) property, or to
purchase or sell services, primarily for the purpose of enabling the debtor
to make payment of such Debt or to assure the holder of such Debt against
loss, (iii) to supply funds to or in any other manner invest in the debtor
(including any agreement to pay for property or services irrespective of
whether such property is received or such services are rendered) or
(iv) otherwise to assure a creditor against loss, and (j) all Debt referred
to in clauses (a) through (i) above of another Person secured by (or for
which the holder of such Debt has an existing right, contingent or
otherwise, to be
secured by) any Lien on property (including, without limitation, accounts
and contract rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Debt.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given
or time elapse or both.
"Defaulted Advance" means, with respect to any Lender Party at any
time, the portion of any Advance required to be made by such Lender Party
to the Borrower pursuant to Section 2.01 or 2.02 at or prior to such time
which has not been made by such Lender Party or by the Administrative Agent
for the account of such Lender Party pursuant to Section 2.02(e) as of such
time. In the event that a portion of a Defaulted Advance shall be deemed
made pursuant to Section 2.15(a), the remaining portion of such Defaulted
Advance shall be considered a Defaulted Advance originally required to be
made pursuant to Section 2.01 on the same date as the Defaulted Advance so
deemed made in part.
"Defaulted Amount" means, with respect to any Lender Party at any
time, any amount required to be paid by such Lender Party to the
Administrative Agent or any other Lender Party hereunder or under any other
Loan Document at or prior to such time which has not been so paid as of
such time, including, without limitation, any amount required to be paid by
such Lender Party to (a) the Swing Line Bank pursuant to Section 2.02(b) to
purchase a portion of a Swing Line Advance made by the Swing Line Bank, (b)
the Issuing Bank pursuant to Section 2.03(c) to purchase a portion of a
Letter of Credit Advance made by the Issuing Bank, (c) the Administrative
Agent pursuant to Section 2.02(e) to reimburse the Administrative Agent for
the amount of any Advance made by the Administrative Agent for the account
of such Lender Party, (d) any other Lender Party pursuant to Section 2.13
to purchase any participation in Advances owing to such other Lender Party
and (e) the Administrative Agent or the Issuing Bank pursuant to Section
7.05 to reimburse the Administrative Agent or the Issuing Bank for such
Lender Party's ratable share of any amount required to be paid by the
Lender Parties to the Administrative Agent or the Issuing Bank as provided
therein. In the event that a portion of a Defaulted Amount shall be deemed
paid pursuant to Section 2.15(b), the remaining portion of such Defaulted
Amount shall be considered a Defaulted Amount originally required to be
paid hereunder or under any other Loan Document on the same date as the
Defaulted Amount so deemed paid in part.
"Defaulting Lender" means, at any time, any Lender Party that, at such
time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall take
any action or be the subject of any action or proceeding of a type
described in Section 6.01(f).
"Disclosed Litigation" has the meaning specified in Section 3.01(g).
"Domestic Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
pursuant to which it became a Lender Party, as the case may be, or such
other office of such Lender Party as such Lender Party may from time to
time specify to the Borrower and the Administrative Agent.
"EBITDA" means, for any period, the sum, determined on a Consolidated
basis, of (a) net income (or net loss), (b) interest expense, (c) income
tax expense, (d) depreciation expense and (e) amortization expense in each
case of PSC and its Subsidiaries, determined in accordance with GAAP for
such period (excluding, in the case of the Fiscal Quarter in which the
consummation of the Acquisition occurs, any restructuring charge taken by
PSC and its Subsidiaries, in respect of the Acquisition).
"Eligible Assignee" means (a) with respect to any Facility (other than
the Letter of Credit Facility), (i) a Lender; (ii) an Affiliate of a
Lender; (iii) a commercial bank organized under the laws of the United
States, or any State thereof, and having total assets in excess of
$500,000,000; (iv) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, and having total
assets in excess of $500,000,000; (v) a commercial bank organized under the
laws of any other country that is a member of the OECD or has concluded
special lending arrangements with the International Monetary Fund
associated with its General Arrangements to Borrow or of the Cayman
Islands, or a political subdivision of any such country, and having total
assets in excess of $500,000,000, so long as such bank is acting through a
branch or agency located in the United States; (vi) the central bank of any
country that is a member of the OECD; (vii) a finance company, insurance
company or other financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making, purchasing
or otherwise investing in commercial loans in the ordinary course of its
business and having total assets in excess of $500,000,000; and (viii) any
other Person approved by the Administrative Agent and the Borrower, such
approval not to be unreasonably withheld or delayed, and (b) with respect
to the Letter of Credit Facility, a Person that is an Eligible Assignee
under subclause (iii) or (v) of clause (a) of this definition and is
approved by the Administrative Agent and the Borrower, such approval not to
be unreasonably withheld or delayed; provided, however, that neither any
Loan Party nor any Affiliate of a Loan Party shall qualify as an Eligible
Assignee under this definition.
"Eligible Receivables" means only such Receivables of PSC and its
Subsidiaries as the Administrative Agent, in its reasonable judgment, shall
from time to time elect to consider Eligible Receivables for purposes of
this Agreement. The value of such Receivables shall be determined by the
Administrative Agent in its reasonable judgment taking into consideration,
among other factors, their book value determined in accordance with GAAP.
By way of example only, and without limiting the discretion of the
Administrative Agent to consider any Receivables not to be Eligible
Receivables, the Administrative Agent may consider any of the following
classes of Receivables not to be Eligible Receivables:
(a) Receivables that do not arise out of sales of goods or
rendering of services in the ordinary course of the Borrower's
business;
(b) Receivables on terms other than those normal or customary in
the Borrower's business;
(c) Receivables owing from any Person that is an Affiliate of the
Borrower;
(d) In the case of Lazerdata Holdings Inc. and its Subsidiaries
Receivables more than 180 days past original invoice date or more than
60 days past the date due and, in the case of PSC and its other
Subsidiaries, Receivables more than 150 days past original invoice
date or more than 60 days past the date due;
(e) Receivables owing from any Person from which an aggregate
amount of more than 50% of the Receivables owing is more than 60 days
past due;
(f) Receivables owing from any Person that shall take or be the
subject of any action or proceeding of a type described in
Section 6.01(f);
(g) Receivables (i) owing from any Person that is also a supplier
to or creditor of the Borrower unless such Person has waived any right
of set-off in a reasonably manner acceptable to the Administrative
Agent or (ii) representing any manufacturer's or supplier's credits,
discounts, incentive plans or similar arrangements entitling the
Borrower to discounts on future purchase therefrom;
(h) Receivables arising out of sales on a bill-and-hold,
guaranteed sale, sale-or-return, sale on approval or consignment basis
or subject to any right of return, set-off or charge-back;
(i) Receivables owing from an account debtor that is an agency,
department or instrumentality of the United States or any State
thereof unless the Borrower shall have satisfied the requirements of
the Assignment of Claims Act of 1940, as amended, and any similar
State legislation and the Administrative Agent is satisfied as to the
absence of set-offs, counterclaims and other defenses on the part of
such account debtor;
(j) Receivables the full and timely payment of which the
Administrative Agent in its reasonable judgment, after consultation
with the Borrower, believes to be doubtful; and
(k) Receivables in respect of which the Security Agreement, after
giving effect to the related filings of financing statements that have
then been made, if any, does not or has ceased to create a valid and
perfected first priority lien or security interest in favor of the
Secured Parties securing the Secured Obligations.
"Environmental Action" means any action, suit, demand, demand letter,
claim, notice of non-compliance or violation, notice of liability or
potential
liability, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law, any Environmental Permit or
Hazardous Material or arising from alleged injury or threat to public
health and safety or the environment, including, without limitation, (a) by
any governmental or regulatory authority for enforcement, cleanup, removal,
response, remedial or other actions or damages and (b) by any governmental
or regulatory authority or third party for damages, contribution,
indemnification, cost recovery, compensation or injunctive relief.
"Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment or natural
resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental
Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of any Loan Party, or under
common control with any Loan Party, within the meaning of Section 414 of
the Internal Revenue Code.
"ERISA Event" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Plan
unless the 30-day notice requirement with respect to such event has been
waived by the PBGC, or (ii) the requirements of subsection (1) of Section
4043(b) of ERISA (without regard to subsection (2) of such Section) are met
with respect to a contributing sponsor, as defined in Section 4001(a)(13)
of ERISA, of a Plan, and an event described in paragraph (9), (10), (11),
(12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days; (b) the application
for a minimum funding waiver with respect to a Plan; (c) the provision by
the administrator of any Plan of a notice of intent to terminate such Plan,
pursuant to Section 4041(a)(2) of ERISA (including any such notice with
respect to a plan amendment referred to in Section 4041(e) of ERISA); (d)
the cessation of operations at a facility of any Loan Party or any ERISA
Affiliate in the circumstances described in Section 4062(e) of ERISA; (e)
the withdrawal by any Loan Party or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial employer,
as defined in Section 4001(a)(2) of ERISA; (f) the conditions for
imposition of a lien under Section 302(f) of ERISA shall have been met with
respect to any Plan; (g) the adoption of an amendment to a Plan requiring
the provision of security to such Plan pursuant to Section 307 of ERISA; or
(h) the institution by the PBGC of proceedings to terminate a Plan pursuant
to Section 4042 of ERISA, or the occurrence of any event or condition
described in Section 4042 of ERISA that constitutes grounds for the
termination of, or the appointment of a trustee to administer, such Plan.
"Escrow Agreement" has the meaning specified in the Purchase
Agreement.
"Eurocurrency Liabilities" has the meaning specified in Regulation D
of the Board of Governors of the Federal Reserve System, as in effect from
time to time.
"Eurodollar Lending Office" means, with respect to any Lender Party,
the office of such Lender Party specified as its "Eurodollar Lending
Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender Party (or, if no such
office is specified, its Domestic Lending Office), or such other office of
such Lender Party as such Lender Party may from time to time specify to the
Borrower and the Administrative Agent.
"Eurodollar Rate" means, for any Interest Period for all Eurodollar
Rate Advances comprising part of the same Borrowing, an interest rate per
annum equal to the rate per annum obtained by dividing (a) the rate per
annum at which deposits in U.S. dollars are offered by Fleet in London,
England to prime banks in the London interbank market at 11:00 A.M. (London
time) two Business Days before the first day of such Interest Period in an
amount substantially equal to Fleet's Eurodollar Rate Advance comprising
part of such Borrowing to be outstanding during such Interest Period (or,
if Fleet shall not have such a Eurodollar Rate Advance, $1,000,000) and for
a period equal to such Interest Period by (b) a percentage equal to 100%
minus the Eurodollar Rate Reserve Percentage for such Interest Period.
"Eurodollar Rate Advance" means, an Advance that bears interest as
provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing means the
reserve percentage applicable two Business Days before the first day of
such Interest Period under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve requirement) for a
member bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities
(or with respect to any other category of liabilities that includes
deposits by reference to which the interest rate on Eurodollar Rate
Advances is determined) having a term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Excess Cash Flow" means for any period the sum of (i) EBITDA of PSC
and its Subsidiaries for such period plus (ii) the aggregate amount of all
non-cash charges deducted in arriving at EBITDA plus (iii) if there was a
net increase in Consolidated Current Liabilities of PSC and its
Subsidiaries during such period, the amount of such net increase plus
(iv) if there was a net decrease in Consolidated Current Assets (excluding
cash and Cash Equivalents) of PSC and its Subsidiaries during such period
the amount of such net decrease less (v) the aggregate amount of mandatory
prepayments or repayments of principal made by PSC and its Subsidiaries on
any Funded Debt of PSC and its Subsidiaries during such period less (vi)
Capital Expenditures of PSC and its Subsidiaries less (vii) the aggregate
amount of all federal, state, local and foreign taxes paid by PSC and its
Subsidiaries during such period less (viii) the aggregate amount of
interest paid on any Funded Debt of PSC and its Subsidiaries during such
periods less (ix) the aggregate amount of all non-cash credits included in
arriving at such EBITDA less (x) if there was a net decrease in
Consolidated Current Liabilities of PSC and its Subsidiaries during such
period, the amount of such net decrease less (xi) if there was a net
increase in Consolidated Current Assets (excluding cash and Cash
Equivalents) of PSC and its Subsidiaries during such period the amount of
such increase.
"Existing Debt" means Debt of TxCom, Scanning and its Subsidiaries
outstanding immediately before giving effect to the Acquisition.
"Extraordinary Receipt" means any cash received by or paid to or for
the account of any Person not in the ordinary course of business,
including, without limitation, tax refunds, pension plan reversions,
proceeds of insurance (other than proceeds of business interruption
insurance to the extent such proceeds constitute compensation for lost
earnings), condemnation awards (and payments in lieu thereof) and indemnity
payments; provided, however, that an Extraordinary Receipt shall not
include cash receipts received from proceeds of insurance, condemnation
awards (or payments in lieu thereof) or indemnity payments to the extent
that such proceeds, awards or payments (A) in respect of loss or damage to
equipment, fixed assets or real property are applied (or in respect of
which expenditures were previously incurred) to replace or repair the
equipment, fixed assets or real property in respect of which such proceeds
were received in accordance with the terms of the Loan Documents, so long
as such application is made within 6 months after the occurrence of such
damage or loss or (B) are received by any Person in respect of any third
party claim against such Person and applied to pay (or to reimburse such
Person for its prior payment of) such claim and the costs and expenses of
such Person with respect thereto.
"Facility" means the Term A Facility, the Term B Facility, the Working
Capital Facility, the Swing Line Facility or the Letter of Credit Facility.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the
average of the quotations for such day for such transactions received by
the Administrative Agent from three Federal funds brokers of recognized
standing selected by it.
"Fiscal Year" means a fiscal year of PSC and its Consolidated
Subsidiaries ending on December 31 in any calendar year.
"Foreign Sales Agreements" has the meaning specified in the Purchase
Agreement.
"Foreign Subsidiary" means each of the following: (A) each Subsidiary
of PSC identified as such on Schedule II annexed hereto and (B) each
Subsidiary of PSC which is organized under the laws of a jurisdiction other
than the United States of America or any state thereof.
"Funded Debt" of any Person means Debt in respect of the Advances, in
the case of the Borrower, and all other Debt of such Person that by its
terms matures more than one year after the date of determination or matures
within one year from such date but is renewable or extendible, at the
option of such Person, to a date more than one year after such date or
arises under a revolving credit or similar agreement that obligates the
lender or lenders to extend credit during a period of more than one year
after such date.
"GAAP" has the meaning specified in Section 1.03.
"Guaranteed Obligations" has the meaning specified in Section 9.01.
"Guarantors" means PSC and the Subsidiary Guarantors.
"Hazardous Materials" means (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas and
(b) any other chemicals, materials or substances designated, classified or
regulated as hazardous or toxic or as a pollutant or contaminant under any
Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements,
currency future or option contracts and other similar agreements.
"Hedge Bank" means any Lender Party in its capacity as a party to a
Bank Hedge Agreement.
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Information Memorandum" means the information memorandum dated June,
1996 used by the Co-Arrangers in connection with the syndication of the
Commitments.
"Initial Extension of Credit" means the earlier to occur of the
initial Borrowing and the initial issuance of a Letter of Credit hereunder.
"Initial Issuing Bank" means Fleet.
"Initial Lenders" has the meaning specified in the recital of parties
to this Agreement.
"Insufficiency" means, with respect to any Plan, the amount, if any,
of its unfunded benefit liabilities, as defined in Section 4001(a)(18) of
ERISA.
"Intellectual Property Security Agreement" has the meaning specified
in Section 3.01(l)(x).
"Interest Expense" means, with respect to any Person for any period,
interest expense on all Debt of such Person for such period net of interest
income for such period, whether paid or accrued, determined on a
Consolidated basis for such Person and its Subsidiaries and in accordance
with GAAP, and including, without limitation, (a) in the case of PSC,
interest expense in respect of Debt resulting from Advances, (b) the
interest component of all obligations under Capitalized Leases, (c)
commissions, discounts and other fees and charges payable in connection
with letters of credit (including, without limitation, Letters of Credit),
(d) the net payment, if any, payable in connection with Hedge Agreements
less the net credit, if any, received in connection with Hedge Agreements
and (e) in the case of the Borrower, all fees paid by such Person pursuant
to Section 2.08(a).
"Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing, the period commencing on the date of such
Eurodollar Rate Advance or the date of the Conversion of any Prime Rate
Advance into such Eurodollar Rate Advance, and ending on the last day of
the period selected by the Borrower pursuant to the provisions below and,
thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the
period selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three or six
months, as the Borrower may, upon notice received by the Administrative
Agent not later than 11:00 A.M. (Rochester, New York time) on the third
Business Day prior to the first day of such Interest Period, select;
provided, however, that:
(a) the Borrower may not select any Interest Period with respect
to any Eurodollar Rate Advance under a Facility that ends after any
principal repayment installment date for such Facility unless, after
giving effect to such selection, the aggregate principal amount of
Prime Rate Advances and of Eurodollar Rate Advances having Interest
Periods that end on or prior to such principal repayment installment
date for such Facility shall be at least equal to the aggregate
principal amount of Advances under such Facility due and payable on or
prior to such date;
(b) Interest Periods commencing on the same date for Eurodollar
Rate Advances comprising part of the same Borrowing shall be of the
same duration;
(c) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day, provided, however, that, if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on
the next preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on a day
of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such initial
calendar month by the number of months equal to the number of months
in such Interest Period, such Interest Period shall end on the last
Business Day of such succeeding calendar month.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"Investment" in any Person means any loan or advance to such Person,
any purchase or other acquisition of any capital stock or other ownership
or profit interest, warrants, rights, options, obligations or other
securities of such Person, any capital contribution to such Person or any
other investment in such Person, including, without limitation, any
arrangement pursuant to which the investor incurs Debt of the types
referred to in clause (i) or (j) of the definition of "Debt" in respect of
such Person.
"IRB Documents" means (i) the Installment Sale Agreement between the
Oregon Economic Development Commission, acting for itself and on behalf of
the Department of Economic Development, and as designee of the State
Treasurer (collectively, the "OEDC") (as such interest of OEDC was assigned
to the Bond Trustee by assignment dated January 1, 1981), and
Spectra-Physics, Inc. dated January 1, 1981, (ii) the Assignment of Rights
Under Installment Sale Agreement dated December 21, 1990 by
Spectra-Physics, Inc. to Scanning, (iii) all financing statements filed
naming the OEDC as secured party and Spectra-Physics, Inc. as debtor, or
naming the OEDC as debtor and Bank of America Oregon as secured party, (iv)
the Guaranty Agreement dated July 1, 1979 between the OEDC and
Spectra-Physics, Inc. and (v) the Indenture of Trust dated as of July 1,
1979 between the OEDC and the Bond Trustee.
"IRB Notices" has the meaning specified in Section 3.01(l)(xiv).
"IRB Property" means the real estate in Eugene, Oregon, that is more
particularly described on Schedule 4.01(ff).
"Issuing Bank" means the Initial Issuing Bank and each Eligible
Assignee to which the Letter of Credit Commitment hereunder has been
assigned pursuant to Section 8.07.
"L/C Cash Collateral Account" has the meaning specified in the
Security Agreement.
"L/C Related Documents" has the meaning specified in Section
2.04(e)(ii).
"Lender Party" means any Lender, the Issuing Bank or the Swing Line
Bank.
"Lenders" means the Initial Lenders and each Person that shall become
a Lender hereunder pursuant to Section 8.07.
"Letter of Credit" has the meaning specified in Section 2.01(e).
"Letter of Credit Advance" means an advance made by the Issuing Bank
or any Working Capital Lender pursuant to Section 2.03(c).
"Letter of Credit Agreement" has the meaning specified in Section
2.03(a)(E).
"Letter of Credit Commitment" means, with respect to the Issuing Bank,
the amount set forth opposite the Issuing Bank's name on Schedule I hereto
under the caption "Letter of Credit Commitment" or, if the Issuing Bank has
entered into one or more Assignments and Acceptances, set forth for the
Issuing Bank in the Register maintained by the Administrative Agent
pursuant to Section 8.07(d) as the Issuing Bank's "Letter of Credit
Commitment," as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Letter of Credit Facility" means, at any time, an amount equal to the
amount of the Issuing Bank's Letter of Credit Commitment at such time, as
such amount may be reduced at or prior to such time pursuant to Section
2.05.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on
title to real property.
"Loan Documents" means (a) for purposes of this Agreement and the
Notes and any amendment or modification hereof or thereof and for all other
purposes other than for purposes of the Subsidiary Guaranty and the
Collateral Documents, (i) this Agreement, (ii) the Notes, (iii) the
Subsidiary Guaranty, (iv) the Collateral Documents, (v) each Letter of
Credit Agreement and (vi) the Assumption Agreement and (b) for purposes of
the Subsidiary Guaranty and the Collateral Documents, (i) this Agreement,
(ii) the Notes, (iii) the Subsidiary Guaranty, (iv) the Collateral
Documents, (v) each Letter of Credit Agreement, (vi) the Assumption
Agreement and (vii) each Bank Hedge Agreement, in each case as amended or
otherwise modified from time to time.
"Loan Parties" means the Borrower and the Guarantors.
"M&T" means Manufacturers and Traders Trust Company.
"Margin Stock" has the meaning specified in Regulation U.
"Material Adverse Change" means any material adverse change in (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party and its Subsidiaries (taken as a
whole), (b) the ability of the Borrower or any Guarantor to perform its
obligations under the Loan Documents or (c) any aspect of the Transaction.
"Material Adverse Effect" has the meaning specified in Section
3.01(g).
"Material Contract" means, with respect to any Person, each contract
listed on Schedule 4.01(hh), each contract which is a replacement or a
substitute for any contract listed on Schedule 4.01(hh) and each other
contract to which such Person is a party which is material to the business,
condition (financial or otherwise), operations, performance, properties or
prospects of such Person.
"Merger" has the meaning specified in the Preliminary Statements.
"Merger Agreement" means the Plan and Agreement of Merger dated July
__, 1996 adopted by the Board of Directors of Scanning and the Board of
Directors of PSC Acquisition.
"Mortgage" means the New York Mortgage, the Oregon Deed of Trust and
each other mortgage delivered pursuant to Section 5.01(o) or Section
5.01(s), in each case as amended, supplemented or otherwise modified from
time to time.
"Mortgage Policy" has the meaning specified in Section 3.01(l)(xi)(B).
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any
of the preceding five plan years made or accrued an obligation to make
contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any
Loan Party or any ERISA Affiliate and at least one Person other than the
Loan Parties and the ERISA Affiliates or (b) was so maintained and in
respect of which any Loan Party or any ERISA Affiliate could have liability
under Section 4064 or 4069 of ERISA in the event such plan has been or were
to be terminated.
"Net Cash Proceeds" means, with respect to any sale, lease, transfer
or other disposition of any asset or the sale or issuance of any Debt or
capital stock or other ownership or profit interest, any securities
convertible into or exchangeable for capital stock or other ownership or
profit interest or any warrants, rights, options or other securities to
acquire capital stock or other ownership or profit interest by any Person
(other than the sale of shares of common stock of PSC to employees of PSC
pursuant to the exercise of stock options received by such employees in
connection with the PSC Stock Option Plans and the sale or issuance of
shares of Common Stock of PSC upon the exercise by the holders of the
Subordinated Notes of the Warrants), or any Extraordinary Receipt received
by or paid to or for the account of any Person, the aggregate amount of
cash received from time to time (whether as initial consideration or
through payment or disposition of deferred consideration) by or on behalf
of such Person in connection with such transaction after deducting
therefrom only (without duplication) (a) reasonable and customary brokerage
commissions, underwriting
fees and discounts, legal fees, finder's fees and other similar fees and
commissions and (b) the amount of taxes payable in connection with or as a
result of such transaction and (c) the amount of any Debt secured by a Lien
on such asset that, by the terms of such transaction, is required to be
repaid upon such disposition, in each case to the extent, but only to the
extent, that the amounts so deducted are, at the time of receipt of such
cash, actually paid to a Person that is not an Affiliate of such Person or
any Loan Party or any Affiliate of any Loan Party and are properly
attributable to such transaction or to the asset that is the subject
thereof.
"New York Mortgage" has the meaning specified in Section 3.01(l)(xi).
"New York Tax Agreement" means the Payment in Lieu of Tax Agreement
dated November 1, 1993 between COMIDA and PSC.
"Nonratable Assignment" means an assignment by a Lender Party pursuant
to Section 8.07(a) of a portion of its rights and obligations under this
Agreement, other than an assignment of a uniform, and not a varying,
percentage of all of the rights and obligations of such Lender Party under
and in respect of all of the Facilities (other than the Letter of Credit
Facility and the Swing Line Facility).
"Note" means a Term A Note, a Term B Note or a Working Capital Note.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Issuance" has the meaning specified in Section 2.03(a).
"Notice of Renewal" has the meaning specified in Section 2.01(e).
"Notice of Swing Line Borrowing" has the meaning specified in Section
2.02(b).
"Notice of Termination" has the meaning specified in Section 2.01(e).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether or
not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured, and whether
or not such claim is discharged, stayed or otherwise affected by any
proceeding referred to in Section 6.01(f). Without limiting the generality
of the foregoing, the Obligations of the Loan Parties under the Loan
Documents include (a) the obligation to pay principal, interest, Letter of
Credit commissions, charges, expenses, fees, attorneys' fees and
disbursements, indemnities and other amounts payable by any Loan Party
under any Loan Document and (b) the obligation of any Loan Party to
reimburse any amount in respect of any of the foregoing that any Lender
Party, in its sole discretion, may elect to pay or advance on behalf of
such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"Open Year" has the meaning specified in Section 4.01(w).
"Oregon Deed of Trust" has the meaning specified in Section
3.01(l)(xi).
"Other Taxes" has the meaning specified in Section 2.12(b).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Permitted Encumbrances" has the meaning specified in the Mortgages.
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall
have been commenced: (a) Liens for taxes, assessments and governmental
charges or levies not yet due and payable; (b) Liens imposed by law, such
as materialmen's, mechanics', carriers', workmen's and repairmen's Liens
and other similar Liens arising in the ordinary course of business securing
obligations that are not overdue for a period of more than 30 days;
(c) pledges or deposits to secure obligations under workers' compensation
laws or similar legislation or to secure public or statutory obligations;
and (d) Permitted Encumbrances.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government
or any political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pre-Commitment Information" has the meaning specified in Section
3.01(j).
"Preferred Stock" means, with respect to any corporation, capital
stock issued by such corporation that is entitled to a preference or
priority over any other capital stock issued by such corporation upon any
distribution of such corporation's assets, whether by dividend or upon
liquidation.
"Prime Rate" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to the
higher of:
(a) the rate of interest announced publicly by Fleet in
Rochester, New York from time to time, as Fleet's prime rate; or
(b) 1/2 of one percent per annum above the Federal Funds Rate.
"Prime Rate Advance" means an Advance that bears interest as provided
in Section 2.07(a)(i).
"Pro Forma EBITDA" means for each fiscal quarter ending on September
30, 1995, December 31, 1995, March 31, 1996 and June 30, 1996 the amount
listed on Schedule III for such fiscal quarter.
"Pro Rata Share" of any amount means, with respect to any Working
Capital Lender at any time, the product of such amount times a fraction the
numerator of which is the amount of such Lender's Working Capital
Commitment at such time and the denominator of which is the Working Capital
Facility at such time.
"PSC" has the meaning specified in the recital of parties to this
Agreement.
"PSC Guaranty" has the meaning specified in Section 9.01.
"PSC Stock Option Plans" means the 1987 Stock Option Plan of PSC and
the 1994 Stock Option Plan of PSC.
"Purchase Agreement" has the meaning specified in the Preliminary
Statements.
"Receivables" means all Receivables referred to in Section 1(c) of the
Security Agreement.
"Redeemable" means, with respect to any capital stock or other
ownership or profit interest, Debt or other right or Obligation, any such
right or Obligation that (a) the issuer has undertaken to redeem at a fixed
or determinable date or dates, whether by operation of a sinking fund or
otherwise, or upon the occurrence of a condition not solely within the
control of the issuer or (b) is redeemable at the option of the holder.
"Reduction Amount" has the meaning specified in Section 2.06(b)(vi).
"Register" has the meaning specified in Section 8.07(d).
"Registration Rights Agreement" has the meaning specified in the
Purchase Agreement.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Related Documents" means the Purchase Agreement, the Merger
Agreement, the Subordinated Debt Documents, the Seller Note, the Foreign
Sales Agreements, the Escrow Agreement, the TxCom Agreement, the
Registration Rights Agreement, the Transition Services Agreement and the
New York Tax Agreement.
"Required Lenders" means at any time Lenders owed or holding at least
66-2/3% of the sum of (a) the aggregate principal amount of the Advances
outstanding at such time and (b) the aggregate Available Amount of all
Letters of Credit outstanding at such time, or, if no
such principal amount and no Letters of Credit are outstanding at such
time, Lenders holding at least 66-2/3% of the aggregate of the Term A
Commitments, Term B Commitments and Working Capital Commitments owed or
holding at least 66-2/3% of the sum of (w) the aggregate principal amount
of the Advances outstanding at such time, (x) the aggregate Available
Amount of all Letters of Credit outstanding at such time, (y) the aggregate
unused Commitments under the Term A and Term B Facilities at such time and
(z) the aggregate Unused Working Capital Commitments at such time;
provided, however, that if any Lender shall be a Defaulting Lender at such
time, there shall be excluded from the determination of Required Lenders at
such time (A) the aggregate principal amount of the Advances owing to such
Lender (in its capacity as a Lender) and outstanding at such time, (B) such
Lender's Pro Rata Share of the aggregate Available Amount of all Letters of
Credit issued by such Lender and outstanding at such time, (C) the
aggregate unused Term A Commitments and Term B Commitments of such Lender
at such time and (D) the Unused Working Capital Commitment of such Lender
at such time. For purposes of this definition, the aggregate principal
amount of Swing Line Advances owing to the Swing Line Bank and of Letter of
Credit Advances owing to the Issuing Bank and the Available Amount of each
Letter of Credit shall be considered to be owed to the Working Capital
Lenders ratably in accordance with their respective Working Capital
Commitments.
"Responsible Officer" means any officer of any Loan Party or any of
its Subsidiaries.
"Secured Obligations" has the meaning specified in the Security
Agreement.
"Secured Parties" means the Administrative Agent, the Lender Parties,
and the Hedge Banks and the other Persons the Obligations owing to which
are or are purported to be secured by the Collateral under the terms of the
Collateral Documents.
"Securities Purchase Agreements" means each Securities Purchase
Agreement dated July __, 1996 between the Surviving Corporation, PSC and a
purchaser of the Subordinated Notes, pursuant to which the Subordinated
Notes are issued.
"Security Agreement" has the meaning specified in Section 3.01(l)(ix).
"Seller Note" means the promissory note dated July __, 1996 made by
PSC Acquisition to the Company.
"Senior Debt" means Debt incurred by the Borrower pursuant to the Loan
Documents and the Hedge Agreements.
"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any
Loan Party or any ERISA Affiliate and no Person other than the Loan Parties
and the ERISA Affiliates or (b) was so maintained and in respect of which
any Loan Party or any ERISA Affiliate could have liability under Section
4069 of ERISA in the event such plan has been or were to be terminated.
"Solvent" and "Solvency" mean, with respect to any Person on a
particular date, that on such date (a) the fair value of the property of
such Person is greater than the total amount of liabilities, including,
without limitation, contingent liabilities, of such Person, (b) the present
fair salable value of the assets of such Person is not less than the amount
that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (c) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay such debts and liabilities as they mature and
(d) such Person is not engaged in business or a transaction, and is not
about to engage in business or a transaction, for which such Person's
property would constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the amount that, in
the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual
or matured liability.
"SP Holdings" has the meaning specified in the Preliminary Statements.
"Standby Letter of Credit" means any Letter of Credit issued under the
Letter of Credit Facility, other than a Trade Letter of Credit.
"Subordinated Debt" means the Subordinated Notes and any other Debt of
the Borrower that is subordinated to the Obligations of the Borrower under
the Loan Documents on, and that otherwise contains, terms and conditions
reasonably satisfactory to the Required Lenders.
"Subordinated Debt Documents" means the Securities Purchase Agreements
and all other agreements, indentures and instruments pursuant to which
Subordinated Debt is issued.
"Subordinated Notes" means the subordinated notes of the Borrower in
an aggregate principal amount of $30,000,000 issued pursuant to the
Securities Purchase Agreements.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having
ordinary voting power to elect a majority of the Board of Directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such partnership, joint venture or limited liability company or
(c) the beneficial interest in such trust or estate is at the time directly
or indirectly owned or controlled by such Person, by such Person and one or
more of its other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"Subsidiary Guarantors" means each direct or indirect Subsidiary of
PSC (other than any Foreign Subsidiary).
"Subsidiary Guaranty" has the meaning specified Section 3.01(l)(xii).
"Surviving Corporation" has the meaning specified in the Preliminary
Statements.
"Surviving Debt" has the meaning specified in Section 3.01(e).
"Swing Line Advance" means an advance made by (a) the Swing Line Bank
pursuant to Section 2.01(d) or (b) any Working Capital Lender pursuant to
Section 2.02(b).
"Swing Line Bank" means Fleet.
"Swing Line Borrowing" means a borrowing consisting of a Swing Line
Advance made by the Swing Line Bank.
"Swing Line Facility" has the meaning specified in Section 2.01(d).
"Tax Certificate" has the meaning specified in Section 5.03(p).
"Taxes" has the meaning specified in Section 2.12(a).
"Term A Advance" has the meaning specified in Section 2.01(a).
"Term A Borrowing" means a borrowing consisting of simultaneous Term A
Advances of the same Type made by the Term A Lenders.
"Term A Commitment" means, with respect to any Term A Lender at any
time, the amount set forth opposite such Lender's name on Schedule I hereto
under the caption "Term A Commitment" or, if such Lender has entered into
one or more Assignments and Acceptances, set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section 8.07(d)
as such Lender's "Term A Commitment," as such amount may be reduced at or
prior to such time pursuant to Section 2.05.
"Term A Facility" means, at any time, the aggregate amount of the
Term A Lenders' Term Commitments at such time.
"Term A Lender" means any Lender that has a Term A Commitment.
"Term A Note" means a promissory note of the Borrower payable to the
order of any Term A Lender, in substantially the form of Exhibit A-1
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term A Advance made by such Lender.
"Term B Advance" has the meaning specified in Section 2.01(b).
"Term B Borrowing" means a borrowing consisting of simultaneous Term B
Advances of the same Type made by the Term B Lenders.
"Term B Commitment" means, with respect to any Term B Lender at any
time, the amount set forth opposite such Lender's name on Schedule I hereto
under the caption "Term B Commitment" or, if such Lender has entered into
one or more Assignments and Acceptances
set forth for such Lender in the Register maintained by the Administrative
Agent pursuant to Section 8.07(d) as such Lender's "Term B Commitment," as
such amount may be reduced at or prior to such time pursuant to Section
2.04.
"Term B Facility" means, at any time, the aggregate amount of the Term
B Lenders' Term B Commitments at such time.
"Term B Lender" means any Lender that has a Term B Commitment.
"Term B Note" means a promissory note of the Borrower payable to the
order of any Term B Lender, in substantially the form of Exhibit A-2
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term B Advance made by such Lender.
"Term Facilities" means the Term A Facility and the Term B Facility.
"Termination Date" means the earlier of December 31, 2002 and the date
of termination in whole of the Term A Commitments, the Term B Commitments,
the Letter of Credit Commitments and the Working Capital Commitments
pursuant to Section 2.05 or 6.01.
"Total Debt Ratio" means, at any date, the ratio of the aggregate
amount of Debt of PSC and its Subsidiaries on the last day of the most
recently completed fiscal quarter of PSC to Consolidated EBITDA for the
most recently completed four fiscal quarters of PSC; provided, however,
that if such four fiscal quarter period includes any or all of the fiscal
quarters ending on September 30, 1995, December 31, 1995, March 31, 1996 or
June 30, 1996, Consolidated EBITDA shall be calculated by using the Pro
Forma EBITDA for each such fiscal quarter in such four fiscal quarter
period; provided, further, that for purposes solely of calculating the
aggregate amount of Debt outstanding, the Working Capital Advances shall be
deemed to be outstanding in an aggregate principal amount equal to the
average principal amount outstanding over the previous two full fiscal
quarters.
"Trade Letter of Credit" means any Letter of Credit that is issued
under the Letter of Credit Facility for the benefit of a supplier of
Inventory to the Borrower or any of its Subsidiaries to effect payment for
such Inventory, the conditions to drawing under which include the
presentation to the Issuing Bank of negotiable bills of lading, invoices
and related documents sufficient, in the judgment of the Issuing Bank, to
create a valid and perfected lien on or security interest in such
Inventory, bills of lading, invoices and related documents in favor of the
Issuing Bank.
"Transaction" means the Acquisition, the Merger, the Securities
Purchase Agreements and the Loan Documents and the transactions
contemplated thereby.
"Transition Services Agreement" has the meaning specified in the
Purchase Agreement.
"TxCom" means T.X.C.O.M., S.A., a French corporation.
"TxCom Agreement" has the meaning specified in the Purchase Agreement.
"Type" refers to the distinction between Advances bearing interest at
the Prime Rate and Advances bearing interest at the Eurodollar Rate.
"Unused Working Capital Commitment" means, with respect to any Working
Capital Lender at any time, (a) such Lender's Working Capital Commitment at
such time minus (b) the sum of (i) the aggregate principal amount of all
Working Capital Advances, Swing Line Advances and Letter of Credit Advances
made by such Lender (in its capacity as a Lender) and outstanding at such
time, plus (ii) such Lender's Pro Rata Share of (A) the aggregate Available
Amount of all Letters of Credit outstanding at such time, (B) the aggregate
principal amount of all Letter of Credit Advances made by the Issuing Bank
pursuant to Section 2.03(c) and outstanding at such time and (C) the
aggregate principal amount of all Swing Line Advances made by the Swing
Line Bank pursuant to Section 2.01(d) and outstanding at such time.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening of
such a contingency.
"Warrants" means the warrants to purchase 975,000 shares of common
stock of PSC issued pursuant to the Securities Purchase Agreements.
"Welfare Plan" means a welfare plan, as defined in Section 3(1) of
ERISA, that is maintained for employees of any Loan Party or in respect of
which any Loan Party could have liability.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"Working Capital Advance" has the meaning specified in
Section 2.01(c).
"Working Capital Borrowing" means a borrowing consisting of
simultaneous Working Capital Advances of the same Type made by the Working
Capital Lenders.
"Working Capital Commitment" means, with respect to any Working
Capital Lender at any time, the amount set forth opposite such Lender's
name on Schedule I hereto under the caption "Working Capital Commitment"
or, if such Lender has entered into one or more Assignments and
Acceptances, set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to Section 8.07(d) as such Lender's "Working
Capital Commitment," as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Working Capital Facility" means, at any time, the aggregate amount of
the Working Capital Lenders' Working Capital Commitments at such time.
"Working Capital Lender" means any Lender that has a Working Capital
Commitment.
"Working Capital Note" means a promissory note of the Borrower payable
to the order of any Working Capital Lender, in substantially the form of
Exhibit A-3 hereto, evidencing the aggregate indebtedness of the Borrower
to such Lender resulting from the Working Capital Advances made by such
Lender.
"Working Capital Termination Date" means the earlier of June 30, 2001
and the date of the termination in whole of the Term Commitments, the
letter of Credit Commitments and the Working Capital Commitments pursuant
to Section 2.05 or 6.01.
SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each mean "to but excluding."
SECTION 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of
the financial statements referred to in Section 4.01(f)(ii) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. The Advances. (a) The Term A Advances. Each Term A Lender
severally agrees, on the terms and conditions hereinafter set forth, to make a
single advance (a "Term A Advance") to the Borrower on any Business Day during
the period from the date hereof until July 30, 1996 in an amount not to exceed
such Lender's Term A Commitment at such time. The Term A Borrowing shall consist
of Term A Advances made simultaneously by the Term A Lenders ratably according
to their Term A Commitments. Amounts borrowed under this Section 2.01(a) and
repaid or prepaid may not be reborrowed.
(b) The Term B Advances. Each Term B Lender severally agrees, on the terms
and conditions hereinafter set forth, to make a single advance (a "Term B
Advance") to the Borrower on any Business Day during the period from the date
hereof until July 30, 1996 in an amount not to exceed such Lender's Term B
Commitment at such time. The Term B Borrowing shall consist of Term B Advances
made simultaneously by the Term B Lenders ratably according to their Term B
Commitments. Amounts borrowed under this Section 2.01(b) and repaid or prepaid
may not be reborrowed.
(c) The Working Capital Advances. Each Working Capital Lender severally
agrees, on the terms and conditions hereinafter set forth, to make advances
(each a "Working Capital Advance") to the Borrower from time to time on any
Business Day during the period from the date hereof until the Working Capital
Termination Date in an amount for each such Advance not to exceed such Lender's
Unused Working Capital Commitment at such time. Each Working Capital Borrowing
shall be in an aggregate amount of $1,000,000 or an integral multiple of
$100,000 in excess thereof (other than a Borrowing the proceeds of which shall
be used solely to repay or prepay in full outstanding Swing Line Advances or
outstanding Letter of Credit Advances) and shall consist of Working Capital
Advances made simultaneously by the Working Capital Lenders ratably according to
their Working Capital Commitments. Within the limits of each Working Capital
Lender's Unused Working Capital Commitment in effect from time to time, the
Borrower may borrow under this Section 2.01(c), prepay pursuant to Section
2.06(a) and reborrow under this Section 2.01(c).
(d) The Swing Line Advances. The Borrower may request the Swing Line Bank
to make, and the Swing Line Bank may, if in its sole discretion it elects to do
so, make, on the terms and conditions hereinafter set forth, Swing Line Advances
to the Borrower from time to time on any Business Day during the period from the
date hereof until the Working Capital Termination Date (i) in an aggregate
amount not to exceed at any time outstanding $5,000,000 (the "Swing Line
Facility") and (ii) in an amount for each such Swing Line Borrowing not to
exceed the aggregate of the Unused Working Capital Commitments of the Working
Capital Lenders at such time. No Swing Line Advance shall be used for the
purpose of funding the payment of principal of any other Swing Line Advance.
Each Swing Line Borrowing shall be made as a Base Rate Advance. Within the
limits of the Swing Line Facility and within the limits referred to in clause
(ii) above, so long as the Swing Line Bank, in its sole discretion, elects to
make Swing Line Advances, the Borrower may borrow under this Section 2.01(d),
repay pursuant to Section 2.04(d) or prepay pursuant to Section 2.06(a) and
reborrow under this Section 2.01(d).
(e) Letters of Credit. The Issuing Bank agrees, on the terms and conditions
hereinafter set forth, to issue letters of credit (the "Letters of Credit") for
the account of the Borrower from time to time on any Business Day during the
period from the date hereof until 60 days before the Working Capital Termination
Date (i) in an aggregate Available Amount for all Letters of Credit not to
exceed at any time the Issuing Bank's Letter of Credit Commitment at such time
and (ii) in an Available Amount for each such Letter of Credit not to exceed an
amount equal to the Unused Working Capital Commitments of the Working Capital
Lenders at such time. No Letter of Credit shall have an expiration date
(including all rights of the Borrower or the beneficiary to require renewal)
later than the earlier of 60 days before the Working Capital Termination Date
and (A) in the case of a Standby Letter of Credit one year after the date of
issuance thereof, but may by its terms be renewable annually upon notice (a
"Notice of Renewal") given to the Issuing Bank and the Administrative Agent on
or prior to any date for notice of renewal set forth in such Letter of Credit
but in any event at least three Business Days prior to the date of the proposed
renewal of such Standby Letter of Credit and upon fulfillment of the applicable
conditions set forth in Article III unless such Issuing Bank has notified the
Borrower (with a copy to the Administrative Agent) on or prior to the date for
notice of termination set forth in such Letter of Credit but in any event at
least 30 Business Days prior to the date of automatic renewal of its election
not to renew such Standby Letter of Credit (a "Notice of Termination")) and
(B) in the case of a Trade Letter of Credit, 180 days after the date of issuance
thereof; provided that the terms of each Standby Letter of Credit that is
automatically renewable annually shall (x) require the Issuing Bank that issued
such Standby Letter of Credit to give the beneficiary named in such Standby
Letter of Credit notice of any Notice of Termination, (y) permit such
beneficiary, upon receipt of such notice, to draw under such Standby Letter of
Credit prior to the date such Standby Letter of Credit otherwise would have been
automatically renewed and (z) not permit the expiration date (after giving
effect to any renewal) of such Standby Letter of Credit in any event to be
extended to a date later than 60 days before the Working Capital Termination
Date. If either a Notice of Renewal is not given by the Borrower or a Notice of
Termination is given by the Issuing Bank pursuant to the immediately preceding
sentence, such Standby Letter of Credit shall expire on the date on which it
otherwise would have been automatically renewed; provided, however, that even in
the absence of receipt of a Notice of Renewal the Issuing Bank may in its
discretion, unless instructed to the contrary by the Administrative Agent or the
Borrower, deem that a Notice of Renewal had been timely delivered and in such
case, a Notice of Renewal shall be deemed to have been so delivered for all
purposes under this Agreement. Within the limits of the Letter of Credit
Facility, and subject to the limits referred to above, the Borrower may request
the issuance of Letters of Credit under this Section 2.01(e), repay any Letter
of Credit Advances resulting from drawings thereunder pursuant to
Section 2.03(c) and request the issuance of additional Letters of Credit under
this Section 2.01(e).
SECTION 2.02. Making the Advances. (a) Except as otherwise provided in
Section 2.02(b) or 2.03, each Borrowing shall be made on notice, given not later
than 11:00 A.M. (Boston, Massachusetts time) on the third Business Day prior to
the date of the proposed Borrowing in the case of a Borrowing consisting of
Eurodollar Rate Advances, or the first Business Day prior to the date of the
proposed Borrowing in the case of a Borrowing consisting of Prime Rate Advances,
by the Borrower to the Administrative Agent, which shall give to each
Appropriate Lender prompt notice thereof by telex or telecopier. Each such
notice of a Borrowing (a "Notice of Borrowing") shall be by telephone, confirmed
immediately in writing, or telex or telecopier, in substantially the form of
Exhibit B hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Facility under which such Borrowing is to be made, (iii) Type of Advances
comprising such Borrowing, (iv) aggregate amount of such Borrowing and (v) in
the case of a Borrowing consisting of Eurodollar Rate Advances, initial Interest
Period for each such Advance. Each Appropriate Lender shall, before 11:00 A.M.
(Rochester, New York time) on the date of such Borrowing, make available for the
account of its Applicable Lending Office to the Administrative Agent at the
Administrative Agent's Account, in same day funds, such Lender's ratable portion
of such Borrowing in accordance with the respective Commitments under the
applicable Facility of such Lender and the other Appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower by crediting the Borrower's Account;
provided, however, that, in the case of any Working Capital Borrowing, the
Administrative Agent shall first make a portion of such funds equal to the
aggregate principal amount of any Swing Line Advances and Letter of Credit
Advances made by the Swing Line Bank or the Issuing Bank, as the case may be,
and by any other Working Capital Lender and outstanding on the date of such
Working Capital Borrowing, plus interest accrued and unpaid thereon to and as of
such date, available to the Swing Line Bank or the Issuing Bank, as the case may
be, and such other Working Capital Lenders for repayment of such Swing Line
Advances and Letter of Credit Advances.
(b) Each Swing Line Borrowing shall be made on notice, given not later than
11:00 A.M. (Rochester, New York time) on the date of the proposed Swing Line
Borrowing, by the Borrower to the Swing Line Bank and the Administrative Agent.
Each such notice of a Swing Line Borrowing (a "Notice of Swing Line Borrowing")
shall be by telephone, confirmed immediately in writing, or telex or telecopier,
specifying therein the requested (i) date of such Borrowing, (ii) amount of such
Borrowing and (iii) maturity of such Borrowing (which maturity shall be no later
than the seventh day after the requested date of such Borrowing). If, in its
sole discretion, it elects to make the requested Swing Line Advance, the Swing
Line Bank will make the amount thereof available to the Administrative Agent at
the Administrative Agent's Account, in same day funds. After the Administrative
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article III, the Administrative Agent will make such funds
available to the Borrower by crediting the Borrower's Account. Upon written
demand by the Swing Line Bank, with a copy of such demand to the Administrative
Agent, each other Working Capital Lender shall purchase from the Swing Line
Bank, and the Swing Line Bank shall sell and assign to each such other Working
Capital Lender, such other Lender's Pro Rata Share of such outstanding Swing
Line Advance as of the date of such demand, by making available for the account
of its Applicable Lending Office to the Administrative Agent for the account of
the Swing Line Bank, by deposit to the Administrative Agent's Account, in same
day funds, an amount equal to the portion of the outstanding principal amount of
such Swing Line Advance to be purchased by such Lender. The Borrower hereby
agrees to each such sale and assignment. Each Working Capital Lender agrees to
purchase its Pro Rata Share of an outstanding Swing Line Advance on (i) the
Business Day on which demand therefor is made by the Swing Line Bank, provided
that notice of such demand is given not later than 11:00 A.M. (Rochester, New
York time) on such Business Day or (ii) the first Business Day next succeeding
such demand if notice of such demand is given after such time. Upon any such
assignment by the Swing Line Bank to any other Working Capital Lender of a
portion of a Swing Line Advance, the Swing Line Bank represents and warrants to
such other Lender that the Swing Line Bank is the legal and beneficial owner of
such interest being assigned by it, but makes no other representation or
warranty and assumes no responsibility with respect to such Swing Line Advance,
the Loan Documents or any Loan Party. If and to the extent that any Working
Capital Lender shall not have so made the amount of such Swing Line Advance
available to the Administrative Agent, such Working Capital Lender agrees to pay
to the Administrative Agent forthwith on demand such amount together with
interest thereon, for each day from the date of demand by the Swing Line Bank
until the date such amount is paid to the Administrative Agent, at the Federal
Funds Rate. If such Lender shall pay to the Administrative Agent such amount for
the account of the Swing Line Bank on any Business Day, such amount so paid in
respect of principal shall constitute a Swing Line Advance made by such Lender
on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Swing Line Advance made by the Swing Line Bank shall be
reduced by such amount on such Business Day.
(c) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select Eurodollar Rate Advances for the initial
Borrowing hereunder or for any Borrowing if the aggregate amount of such
Borrowing is less than $1,000,000 or if the obligation of the Appropriate
Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to
Section 2.09 or Section 2.10 and (ii) the Term A Advances may not be outstanding
as part of more than 5 separate Borrowings, the Term B Advances may not be
outstanding as part of more than 5 separate Borrowings and the Working Capital
Advances made on any date may not be outstanding as part of more than 10
separate Borrowings.
(d) Each Notice of Borrowing and Notice of Swing Line Borrowing shall be
irrevocable and binding on the Borrower. In the case of any Borrowing that the
related Notice of Borrowing specifies is to be comprised of Eurodollar Rate
Advances, the Borrower shall indemnify each Appropriate Lender against any loss,
cost or expense incurred by such Lender as a result of any failure to fulfill on
or before the date specified in such Notice of Borrowing for such Borrowing the
applicable conditions set forth in Article III, including, without limitation,
any loss (including loss of anticipated profits), cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
such Lender to fund the Advance to be made by such Lender as part of such
Borrowing when such Advance, as a result of such failure, is not made on such
date.
(e) Unless the Administrative Agent shall have received notice from an
Appropriate Lender prior to the date of any Borrowing under a Facility under
which such Lender has a Commitment that such Lender will not make available to
the Administrative Agent such Lender's ratable portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (a) or (b) of this Section 2.02 and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Administrative Agent, such Lender and
the Borrower severally agree to repay or pay to the Administrative Agent
forthwith on demand such corresponding amount and to pay interest thereon, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid or paid to the Administrative Agent, at (i) in the
case of the Borrower, the interest rate applicable at such time under Section
2.07 to Advances comprising such Borrowing and (ii) in the case of such Lender,
the Federal Funds Rate. If such Lender shall pay to the Administrative Agent
such corresponding amount, such amount so paid shall constitute such Lender's
Advance as part of such Borrowing for all purposes.
(f) The failure of any Lender to make the Advance to be made by it as part
of any Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make its Advance on the date of such Borrowing, but no Lender shall
be responsible for the failure of any other Lender to make the Advance to be
made by such other Lender on the date of any Borrowing.
SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of
Credit. (a) Request for Issuance. Each Letter of Credit shall be issued upon
notice, given not later than 11:00 A.M. (Rochester, New York time) on the fifth
Business Day prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to the Issuing Bank, which shall give to the
Administrative Agent and each Working Capital Lender prompt notice thereof by
telex or telecopier. Each such notice of issuance of a Letter of Credit (a
"Notice of Issuance") shall be by telephone, confirmed immediately in writing,
or telex or telecopier, specifying therein the requested (A) date of such
issuance (which shall be a Business Day), (B) Available Amount of such Letter of
Credit, (C) expiration date of such Letter of Credit, (D)name and address of the
beneficiary of such Letter of Credit and (E) form of such Letter of Credit, and
shall be accompanied by such application and agreement for letter of credit as
the Issuing Bank may specify to the Borrower for use in connection with such
requested Letter of Credit (a "Letter of Credit Agreement"). If the requested
form of such Letter of Credit is acceptable to the Issuing Bank in its sole
discretion, the Issuing Bank will, upon fulfillment of the applicable conditions
set forth in Article III, make such Letter of Credit available to the Borrower
at its office referred to in Section 8.02 or as otherwise agreed with the
Borrower in connection with such issuance. In the event and to the extent that
the provisions of any Letter of Credit Agreement shall conflict with this
Agreement, the provisions of this Agreement shall govern.
(b) Letter of Credit Reports. The Issuing Bank shall furnish (A) to the
Administrative Agent on the first Business Day of each week a written report
summarizing issuance and expiration dates of Letters of Credit issued during the
previous week and drawings during such week under all Letters of Credit, (B) to
each Working Capital Lender on the first Business Day of each month a written
report summarizing issuance and expiration dates of Letters of Credit issued
during the preceding month and drawings during such month under all Letters of
Credit and (C) to the Administrative Agent and each Working Capital Lender on
the first Business Day of each calendar quarter a written report setting forth
the average daily aggregate Available Amount during the preceding calendar
quarter of all Letters of Credit.
(c) Drawing and Reimbursement. The payment by the Issuing Bank of a draft
drawn under any Letter of Credit shall constitute for all purposes of this
Agreement the making by the Issuing Bank of a Letter of Credit Advance, which
shall be a Prime Rate Advance, in the amount of such draft. Upon written demand
by the Issuing Bank, with a copy of such demand to the Administrative Agent,
each Working Capital Lender shall purchase from the Issuing Bank, and the
Issuing Bank shall sell and assign to each such Working Capital Lender, such
Lender's Pro Rata Share of such outstanding Letter of Credit Advance as of the
date of such purchase, by making available for the account of its Applicable
Lending Office to the Administrative Agent for the account of the Issuing Bank,
by deposit to the Administrative Agent's Account, in same day funds, an amount
equal to the portion of the outstanding principal amount of such Letter of
Credit Advance to be purchased by such Lender. Promptly after receipt thereof,
the Administrative Agent shall transfer such funds to the Issuing Bank. The
Borrower hereby agrees to each such sale and assignment. Each Working Capital
Lender agrees to purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made by the Issuing
Bank, provided notice of such demand is given not later than 11:00 A.M.
(Rochester, New York time) on such Business Day or (ii) the first Business Day
next succeeding such demand if notice of such demand is given after such time.
Upon any such assignment by the Issuing Bank to any other Working Capital Lender
of a portion of a Letter of Credit Advance, the Issuing Bank represents and
warrants to such other Lender that the Issuing Bank is the legal and beneficial
owner of such interest being assigned by it, free and clear of any liens, but
makes no other representation or warranty and assumes no responsibility with
respect to such Letter of Credit Advance, the Loan Documents or any Loan Party.
If and to the extent that any Working Capital Lender shall not have so made the
amount of such Letter of Credit Advance available to the Administrative Agent,
such Working Capital Lender agrees to pay to the Administrative Agent forthwith
on demand such amount together with interest thereon, for each day from the date
of demand by the Issuing Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate for its account or the account
of the Issuing Bank, as applicable. If such Lender shall pay to the
Administrative Agent such amount for the account of the Issuing Bank on any
Business Day, such amount so paid in respect of principal shall constitute a
Letter of Credit Advance made by such Lender on such Business Day for purposes
of this Agreement, and the outstanding principal amount of the Letter of Credit
Advance made by the Issuing Bank shall be reduced by such amount on such
Business Day.
(d) Failure to Make Letter of Credit Advances. The failure of any Lender to
make the Letter of Credit Advance to be made by it on the date specified in
Section 2.03(c) shall not relieve any other Lender of its obligation hereunder
to make its Letter of Credit Advance on such date, but no Lender shall be
responsible for the failure of any other Lender to make the Letter of Credit
Advance to be made by such other Lender on such date.
SECTION 2.04. Repayment of Advances. (a) Term A Advances. The Borrower
shall repay to the Administrative Agent for the ratable account of the Term A
Lenders the aggregate outstanding principal amount of the Term A Advances on the
following dates in the amounts indicated (which amounts shall be reduced as a
result of the application of prepayments in accordance with the order of
priority set forth in Section 2.06):
Date Amount
- - ---- ------
March 31, 1997 ........................................ $2,000,000
June 30, 1997 ......................................... $2,000,000
September 30, 1997 .................................... $2,000,000
December 31, 1997 ..................................... $2,000,000
March 31, 1998 ........................................ $2,500,000
June 30, 1998 ......................................... $2,500,000
September 30, 1998 .................................... $2,500,000
December 30, 1998 ..................................... $2,500,000
March 31, 1999 ........................................ $3,000,000
June 30, 1999 ......................................... $3,000,000
September 30, 1999 .................................... $3,000,000
December 31, 1999 ..................................... $3,000,000
March 31, 2000 ........................................ $3,500,000
June 30, 2000 ......................................... $3,500,000
September 30, 2000 .................................... $3,500,000
December 30, 2000 ..................................... $3,500,000
March 31, 2001 ........................................ $4,500,000
June 30, 2001 ......................................... $6,500,000
provided, however, that the final principal installment shall be repaid on the
Working Capital Termination Date and in any event shall be in an amount equal to
the aggregate principal amount of the Term A Advances outstanding on such date.
(b) Term B Advances. The Borrower shall repay to the Administrative Agent
for the ratable account of the Term B Lenders the aggregate outstanding
principal amount of the Term B Advances on the following dates in the amounts
indicated (which amounts shall be reduced as a result of the application of
prepayments in accordance with the order of priority set forth in Section 2.06):
Date Amount
- - ---- ------
March 31, 1997 ........................................ $ 250,000
June 30, 1997 ......................................... $ 250,000
September 30, 1997 .................................... $ 250,000
December 31, 1997 ..................................... $ 250,000
March 31, 1998 ........................................ $ 250,000
June 30, 1998 ......................................... $ 250,000
September 30, 1998 .................................... $ 250,000
December 31, 1998 ..................................... $ 250,000
March 31, 1999 ........................................ $ 250,000
June 30, 1999 ......................................... $ 250,000
September 30, 1999 .................................... $ 250,000
December 31, 1999 ..................................... $ 250,000
March 31, 2000 ........................................ $ 250,000
June 30, 2000 ......................................... $ 250,000
September 30, 2000 .................................... $ 250,000
December 31, 2000 ..................................... $ 250,000
March 31, 2001 ........................................ $2,625,000
June 30, 2001 ......................................... $2,625,000
September 30, 2001 .................................... $2,625,000
December 31, 2001 ..................................... $2,625,000
March 31, 2002 ........................................ $2,625,000
June 30, 2002 ......................................... $2,625,000
September 30, 2002 .................................... $2,625,000
December 31, 2002 ..................................... $2,625,000
provided, however, that the final principal installment shall be repaid on the
Termination Date and in any event shall be in an amount equal to the aggregate
principal amount of the Term B Advances outstanding on such date.
(c) Working Capital Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Working Capital Lenders on
the Working Capital Termination Date the aggregate outstanding principal amount
of the Working Capital Advances then outstanding.
(d) Swing Line Advances. The Borrower shall repay to the Administrative
Agent for the account of each Swing Line Bank and each other Working Capital
Lender that has made a Swing Line Advance the outstanding principal amount of
each Swing Line Advance made by each of them on the earlier of the maturity date
specified in the applicable Notice of Swing Line Borrowing (which maturity shall
be no later than the seventh day after the requested date of such Borrowing) and
the Working Capital Termination Date.
(e) Letter of Credit Advances. (i) The Borrower shall repay to the
Administrative Agent for the account of the Issuing Bank and each other Working
Capital Lender that has made a Letter of Credit Advance on the earlier of demand
and the Working Capital Termination Date the outstanding principal amount of
each Letter of Credit Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any Letter of
Credit Agreement and any other agreement or instrument relating to any Letter of
Credit shall be unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement, such Letter of Credit Agreement and
such other agreement or instrument under all circumstances, including, without
limitation, the following circumstances:
(A) any lack of validity or enforceability of any Loan Document, any
Letter of Credit Agreement, any Letter of Credit or any other agreement or
instrument relating thereto (all of the foregoing being, collectively, the
"L/C Related Documents");
(B) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations of the Borrower in respect of
any L/C Related Document or any other amendment or waiver of or any consent
to departure from all or any of the L/C Related Documents;
(C) the existence of any claim, set-off, defense or other right that
the Borrower may have at any time against any beneficiary or any transferee
of a Letter of Credit (or any Persons for whom any such beneficiary or any
such transferee may be acting), the Issuing Bank or any other Person,
whether in connection with the transactions contemplated by the L/C Related
Documents or any unrelated transaction;
(D) any statement or any other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any respect;
or
(E) any exchange, release or non-perfection of any Collateral or other
collateral, or any release or amendment or waiver of or consent to
departure from the Guaranty or any other guarantee, for all or any of the
Obligations of the Borrower in respect of the L/C Related Documents.
SECTION 2.05. Termination or Reduction of the Commitments. (a) Optional.
The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the unused portions
of the Term A Commitments, the Term B Commitments, the Letter of Credit Facility
and the Unused Working Capital Commitments; provided, however, that each partial
reduction of a Facility (i) shall be in an aggregate amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof and (ii) shall be made ratably
among the Appropriate Lenders in accordance with their Commitments with respect
to such Facility.
(b) Mandatory. (i) On the date of the Term A Borrowing, after giving effect
to such Term A Borrowing, and from time to time thereafter upon each repayment
or prepayment of the Term A Advances, the aggregate Term A Commitments of the
Term A Lenders shall be automatically and permanently reduced, on a pro rata
basis, by an amount equal to the amount by which the aggregate Term A
Commitments immediately prior to such reduction exceed the aggregate unpaid
principal amount of the Term A Advances then outstanding.
(ii) On the date of the Term B Borrowing, after giving effect to such
Term B Borrowing, and from time to time thereafter upon each repayment or
prepayment of the Term B Advances, the aggregate Term B Commitments of the
Term B Lenders shall be automatically and permanently reduced, on a pro rata
basis, by an amount equal to the amount by which the aggregate Term B
Commitments immediately prior to such reduction exceed the aggregate unpaid
principal amount of the Term B Advances then outstanding.
(iii) On and after the date that all Term A Advances and Term B Advances
have been repaid in full, the Working Capital Facility shall be automatically
and permanently reduced on each date on which prepayment thereof is required to
be made pursuant to Section 2.06(b)(i), (ii) or (iii) in an amount equal to the
applicable Reduction Amount, provided that each such reduction of the Working
Capital Facility shall be made ratably among the Working Capital Lenders in
accordance with their Working Capital Commitments.
(iv) The Letter of Credit Facility shall be permanently reduced from time
to time on the date of each reduction in the Working Capital Facility by the
amount, if any, by which the amount of the Letter of Credit Facility exceeds the
Working Capital Facility after giving effect to such reduction of the Working
Capital Facility.
SECTION 2.06. Prepayments. (a) Optional. The Borrower may, upon at least
one Business Day's notice in the case of Prime Rate Advances and three Business
Days' notice in the case of Eurodollar Rate Advances, in each case to the
Administrative Agent stating the proposed date and aggregate principal amount of
the prepayment, and if such notice is given the Borrower shall, prepay the
outstanding aggregate principal amount of the Advances comprising part of the
same Borrowing in whole or ratably in part, together with (i) accrued interest
to the date of such prepayment on the aggregate principal amount prepaid;
provided, however, that (x) each partial prepayment shall be in an aggregate
principal amount of $1,000,000 or an integral multiple of $100,000 in excess
thereof and (y) no such prepayment of a Eurodollar Rate Advance shall be made
other than on the last day of an Interest Period therefor. Each such prepayment
of the Term Facilities shall be applied ratably to the Term A Facility and the
Term B Facility and to the principal repayment installments of each of the Term
A Facility and Term B Facility in inverse order of maturity; provided, however,
that if any of the Lenders under either the Term A Facility or the Term B
Facility elects to refuse its ratable share of any such prepayment, in
accordance with the procedures described in Section 2.06(c), the ratable share
of such Lender shall be applied to the Advances of the Lenders under such Term
Facility and to the principal repayment installments thereof in inverse order of
maturity, or if all Lenders in such Term Facility elect to refuse their ratable
share, to the Advances of the Lenders under the other Term Facility and to the
principal repayment installments thereof in inverse order of maturity.
(b) Mandatory. (i) The Borrower shall, on the fifth day following the date
the Lender Parties have received or are required to have received (pursuant to
Section 5.03(d)) the audited financials of PSC for each fiscal year of the
Borrower, prepay an aggregate principal amount of the Advances comprising part
of the same Borrowings equal to (x) if the Total Debt Ratio is 3.50:1 or more,
75% of Excess Cash Flow for such Fiscal Year, (y) if the Total Debt Ratio is
less than 3.50:1 but more than 2.49:1, 50%, and (z) at all other times, 0% of
Excess Cash Flow for such fiscal year. Each such prepayment shall be applied
first ratably to the Term A Facility, and the Term B Facility, and to the
installments thereof in inverse order of maturity and second to the Working
Capital Facility as set forth in clause (vi) below.
(ii) PSC and the Borrower shall, on the date of receipt of the Net Cash
Proceeds by any Loan Party or any of its Subsidiaries from (A) the sale, lease,
transfer or other disposition of any assets of any Loan Party or any of its
Subsidiaries (other than any sale, lease, transfer or other disposition of
assets pursuant to clause (i) of Section 5.02(e)), (B) the incurrence or
issuance by any Loan Party or any of its Subsidiaries of any Debt (other than
Debt incurred or issued pursuant to clause Section 5.02(b)), (C) the sale or
issuance by any Loan Party (other than PSC) or any of the other Subsidiaries of
any PSC capital stock or other ownership or profit interest, any securities
convertible into or exchangeable for capital stock or other ownership or profit
interest or any warrants, rights or options to acquire capital stock or other
ownership or profit interest and (D) any Extraordinary Receipt received by or
paid to or for the account of any Loan Party or any of its Subsidiaries and not
otherwise included in clause (A), (B) or (C) above, prepay an aggregate
principal amount of the Advances comprising part of the same Borrowings equal to
the amount of such Net Cash Proceeds. Each such prepayment shall be applied
first, ratably to the Term A Facility and the Term B Facility and to the
installments thereof in inverse order of maturity and second to the Working
Capital Facility as set forth in clause (vi) below.
(iii) PSC and the Borrower shall, on the date of receipt of the Net Cash
Proceeds by any Loan Party or any of its Subsidiaries from the sale or issuance
by PSC of any capital stock or other ownership or profit interest, any
securities convertible into or exchangeable for capital stock or other ownership
or profit interest, or any warrants, rights or options to acquire capital stock
or other ownership or profit interest, prepay an aggregate principal of the
Advances comprising part of the same Borrowings equal to (x) if the Total Debt
Ratio is 3.5:1 or more, 100% of the amount of such Net Cash Proceeds to the
extent, and only to the extent, that such Net Cash Proceeds are necessary to
reduce the Total Debt Ratio to less than 3.5:1 and (y) if the Total Debt Ratio
is less than 3.5:1, 0% of such Net Cash Proceeds.
(iv) The Borrower shall, on each Business Day, prepay an aggregate
principal amount of the Working Capital Advances comprising part of the same
Borrowings, and the Letter of Credit Advances and the Swing Line Advances equal
to the amount by which (A) the sum of the aggregate principal amount of (x) the
Working Capital Advances and (y) the Letter of Credit Advances and (z) the Swing
Line Advances then outstanding plus the aggregate Available Amount of all
Letters of Credit then outstanding exceeds (B) the lesser of the Working Capital
Facility and the Borrowing Base on such Business Day.
(v) The Borrower shall, on each Business Day, pay to the Administrative
Agent for deposit in the L/C Cash Collateral Account an amount sufficient to
cause the aggregate amount on deposit in such Account to equal the amount by
which the aggregate Available Amount of all Letters of Credit then outstanding
exceeds the Letter of Credit Facility on such Business Day.
(vi) Prepayments of the Working Capital Facility made pursuant to clause
(i), (ii) or (iii) above shall be first applied to prepay Letter of Credit
Advances then outstanding until such Advances are paid in full, second applied
to prepay Swing Line Advances then outstanding until such Advances are paid in
full, third applied to prepay Working Capital Advances then outstanding
comprising part of the same Borrowings until such Advances are paid in full, and
fourth deposited in the L/C Cash Collateral Account to cash collateralize 100%
of the Available Amount of the Letters of Credit then outstanding; and, in the
case of prepayments of the Working Capital Facility required pursuant to clause
(i) or (ii) above, the amount remaining (if any) after the prepayment in full of
the Advances then outstanding and the 100% cash collateralization of the
aggregate Available Amount of Letters of Credit then outstanding (the sum of
such prepayment amounts, cash collateralization amounts and remaining amount
being referred to herein as the "Reduction Amount") may be retained by the
Borrower and the Working Capital Facility shall be permanently reduced as set
forth in Section 2.05(b)(iii). Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Cash Collateral Account, such funds shall
be applied to reimburse the Issuing Bank or the Working Capital Lenders, as
applicable.
(vii) All prepayments under this subsection (b) shall be made together with
accrued interest to the date of such prepayment on the principal amount prepaid.
(c) Application of Prepayments to the Term A Facility and the Term B
Facility. Upon receipt of any amounts to be applied to the prepayment in respect
of the Term A Facility and the Term B Facility pursuant to this Section 2.06,
the Administrative Agent shall apply such amounts to the prepayment of the Term
A Advances and Term B Advance ratably; provided however, that if within five
Business Days of receiving notice from the Administrative Agent of a prepayment,
any Term A Lender or any Term B Lender notifies the Administrative Agent that it
elects to refuse to accept the prepayment of its Term A Advances or its Term B
Advances, as the case may be, the Administrative Agent shall apply the portion
of such prepayment that would have been allocated to the repayment of such
Lender's Term A Advances or the Term B Advances, as the case may be, to the
prepayment of the Advances of the other Lenders under the same Term Facility and
to the principal repayment installments thereof in inverse order of maturity or,
if all Lenders under such Term Facility elect to refuse their ratable share of
such prepayment, to the Advances of the Lenders under the other Term Facility
and to the principal repayment installments thereof in inverse order of
maturity. If any Term A Lender or Term B Lender shall not give notice to the
Administrative Agent within such five Business Day period, the Administrative
Agent shall assume that such Lender shall have accepted such prepayment.
SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Advance owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Prime Rate Advances. During such periods as such Advance is a
Prime Rate Advance, a rate per annum equal at all times to the sum of (A)
the Prime Rate in effect from time to time plus (B) the Applicable Margin
in effect from time to time, payable in arrears monthly on the last day of
each month during such periods and on the date such Prime Rate Advance
shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such Advance is
a Eurodollar Rate Advance, a rate per annum equal at all times during each
Interest Period for such Advance to the sum of (A) the Eurodollar Rate for
such Interest Period for such Advance plus (B) the Applicable Margin in
effect on the first day of such Interest Period, payable in arrears on the
last day of such Interest Period and, if such Interest Period has a
duration of more than three months, on each day that occurs during such
Interest Period every three months from the first day of such Interest
Period and on the date such Eurodollar Rate Advance shall be Converted or
paid in full.
(b) Default Interest. Upon the occurrence and during the continuance of a
Default, the Borrower shall pay interest on (i) the unpaid principal amount of
each Advance owing to each Lender, payable in arrears on the dates referred to
in clause (a)(i) or (a)(ii) above and on demand, at a rate per annum equal at
all times to 2% per annum above the rate per annum required to be paid on such
Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to the fullest
extent permitted by law, the amount of any interest, fee or other amount payable
hereunder that is not paid when due, from the date such amount shall be due
until such amount shall be paid in full, payable in arrears on the date such
amount shall be paid in full and on demand, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid, in the case
of interest, on the Type of Advance on which such interest has accrued pursuant
to clause (a)(i) or (a)(ii) above, and, in all other cases, on Prime Rate
Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Rate. Promptly after receipt of a Notice of
Borrowing pursuant to Section 2.02(a), the Administrative Agent shall give
notice to the Borrower and each Appropriate Lender of the applicable interest
rate determined by the Administrative Agent for purposes of clause (a)(i) or
(ii).
SECTION 2.08. Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders a commitment fee, from the
date hereof in the case of each Initial Lender and from the effective date
specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date, payable in arrears
on the date of the initial Borrowing hereunder, thereafter quarterly on the last
Business Day of each March, June, September, and December, commencing September
30, 1996, and on the Termination Date, at a rate per annum equal to the
Commitment Fee Percentage on the average daily unused portion of each
Appropriate Lender's Term A Commitment and Term B Commitment and on the sum of
the average daily Unused Working Capital Commitment of such Lender plus its Pro
Rata Share of the average daily outstanding Swing Line Advances during such
quarter; provided, however, that any commitment fee accrued with respect to any
of the Commitments of a Defaulting Lender during the period prior to the time
such Lender became a Defaulting Lender and unpaid at such time shall not be
payable by the Borrower so long as such Lender shall be a Defaulting Lender
except to the extent that such commitment fee shall otherwise have been due and
payable by the Borrower prior to such time; and provided further that no
commitment fee shall accrue on any of the Commitments of a Defaulting Lender so
long as such Lender shall be a Defaulting Lender.
(b) Letter of Credit Fees, Etc. (i) The Borrower shall pay to the
Administrative Agent for the account of each Working Capital Lender a
commission, payable in arrears quarterly on the last Business Day of each March,
June, September and December, commencing September 30, 1996, and on the earliest
to occur of the full drawing expiration, termination or cancellation of any such
Letter of Credit and on the Termination Date, on such Lender's Pro-Rata Share of
the average daily aggregate Available Amount during such quarter of all Letters
of Credit outstanding from time to time at the rate per annum equal to the
Applicable Margin then in effect for Eurodollar Advances under the Working
Capital Facility.
(ii) The Borrower shall pay to the Issuing Bank, for its own account, such
commissions, issuance fees, fronting fees, transfer fees and other fees and
charges in connection with the issuance or administration of each Letter of
Credit as the Borrower and the Issuing Bank shall agree.
(c) Administrative Agent's Fees. The Borrower shall pay to the
Administrative Agent for its own account such fees as may from time to time be
agreed between the Borrower and the Administrative Agent.
SECTION 2.09. Conversion of Advances. (a) Optional. The Borrower may on any
Business Day, upon notice given to the Administrative Agent not later than
11:00 A.M. (Rochester, New York time) on the third Business Day prior to the
date of the proposed Conversion and subject to the provisions of Sections 2.07
and 2.10, Convert all or any portion of the Advances of one Type comprising the
same Borrowing into Advances of the other Type; provided, however, that any
Conversion of Eurodollar Rate Advances into Prime Rate Advances shall be made
only on the last day of an Interest Period for such Eurodollar Rate Advances,
any Conversion of Prime Rate Advances into Eurodollar Rate Advances shall be in
an amount not less than the minimum amount specified in Section 2.02(c), no
Conversion of any Advances shall result in more separate Borrowings than
permitted under Section 2.02(c) and each Conversion of Advances comprising part
of the same Borrowing under any Facility shall be made ratably among the
Appropriate Lenders in accordance with their Commitments under such Facility.
Each such notice of Conversion shall, within the restrictions specified above,
specify (i) the date of such Conversion, (ii) the Advances to be Converted and
(iii) if such Conversion is into Eurodollar Rate Advances, the duration of the
initial Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by
payment or prepayment or otherwise, to less than $1,000,000, such Advances shall
automatically Convert into Prime Rate Advances.
(ii) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Appropriate
Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Prime
Rate Advance.
(iii) Upon the occurrence and during the continuance of any Default, (x)
each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Prime Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.
SECTION 2.10. Increased Costs, Etc. (a) If, due to either (i) the
introduction of or any change (other than any change by way of imposition or
increase of) reserve requirements included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or of making,
funding or maintaining Eurodollar Rate Advances or of agreeing to issue or of
issuing or maintaining Letters of Credit or of agreeing to make or of making or
maintaining Letter of Credit Advances (excluding for purposes of this Section
2.10 any such increased costs resulting from (A) Taxes or Other Taxes (as to
which Section 2.12 shall govern) and (B) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision
thereof), then the Borrower shall from time to time, upon demand by such Lender
Party (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased cost; provided,
however, that a Lender Party claiming additional amounts under this Section
2.10(a) agrees to use reasonable efforts (consistent with its internal policy
and legal and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such a designation would avoid the need for, or
reduce the amount of, such increased cost that may thereafter accrue and would
not, in the reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party. A certificate as to the amount of such
increased cost, submitted to the Borrower by such Lender Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
amount of capital required or reasonably expected to be maintained by any Lender
Party or any corporation controlling such Lender Party as a result of or based
upon the existence of such Lender Party's commitment to lend or to issue Letters
of Credit hereunder and other commitments of such type or the issuance or
maintenance of the Letters of Credit (or similar contingent obligations), then,
upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to the Administrative Agent for
the account of such Lender Party, from time to time as specified by such Lender
Party, additional amounts sufficient to compensate such Lender Party in the
light of such circumstances, to the extent that such Lender Party reasonably
determines such increase in capital to be allocable to the existence of such
Lender Party's commitment to lend or to issue Letters of Credit hereunder or to
the issuance or maintenance of any Letters of Credit. A certificate as to such
amounts submitted to the Borrower by such Lender Party shall be conclusive and
binding for all purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances under any Facility,
Lenders owed at least 66-2/3% of the then aggregate unpaid principal amount
thereof notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Appropriate Lenders, whereupon (i) each such Eurodollar Rate
Advance under any Facility will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Prime Rate Advance and
(ii) the obligation of the Appropriate Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended until the Administrative Agent
shall notify the Borrower that such Lenders have determined that the
circumstances causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance under each
Facility under which such Lender has a Commitment will automatically, upon such
demand, Convert into a Prime Rate Advance and (ii) the obligation of the
Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower that such Lender has determined that the circumstances causing such
suspension no longer exist; provided, however, that, before making any such
demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Eurodollar Lending Office if the making of such a designation would allow such
Lender or its Eurodollar Lending Office to continue to perform its obligations
to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar
Rate Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
SECTION 2.11. Payments and Computations. (a) The Borrower shall make each
payment hereunder and under the Notes, irrespective of any right of counterclaim
or set-off (except as otherwise provided in Section 2.15), not later than 11:00
A.M. (Rochester, New York time) on the day when due in U.S. dollars to the
Administrative Agent at the Administrative Agent's Account in same day funds.
The Administrative Agent will promptly thereafter cause like funds to be
distributed (i) if such payment by the Borrower is in respect of principal,
interest, commitment fees or any other Obligation then payable hereunder and
under the Notes to more than one Lender Party, to such Lender Parties for the
account of their respective Applicable Lending Offices ratably in accordance
with the amounts of such respective Obligations then payable to such Lender
Parties and (ii) if such payment by the Borrower is in respect of any Obligation
then payable hereunder to one Lender Party, to such Lender Party for the account
of its Applicable Lending Office, in each case to be applied in accordance with
the terms of this Agreement. Upon its acceptance of an Assignment and Acceptance
and recording of the information contained therein in the Register pursuant to
Section 8.07(d), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender Party
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) If the Administrative Agent receives funds for application to the
Obligations under the Loan Documents under circumstances for which the Loan
Documents do not specify the Advances or the Facility to which, or the manner in
which, such funds are to be applied, the Administrative Agent may, but shall not
be obligated to, elect to distribute such funds to each Lender Party ratably in
accordance with such Lender Party's proportionate share of the principal amount
of all outstanding Advances and the Available Amount of all Letters of Credit
then outstanding, in repayment or prepayment of such of the outstanding Advances
or other Obligations owed to such Lender Party, and for application to such
principal installments, as the Administrative Agent shall direct.
(c) The Borrower hereby authorizes each Lender Party, if and to the extent
payment owed to such Lender Party is not made when due hereunder or, in the case
of a Lender, under the Note held by such Lender, to charge from time to time
against any or all of the Borrower's accounts with such Lender Party any amount
so due.
(d) All computations of interest, fees and Letter of Credit commissions
shall be made by the Administrative Agent on the basis of a year of 360 days, in
each case for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest, fees or
commissions are payable. Each determination by the Administrative Agent of
an interest rate, fee or commission hereunder shall be conclusive and binding
for all purposes, absent manifest error.
(e) Whenever any payment hereunder or under the Notes shall be stated to be
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or commitment fee, as the
case may be; provided, however, that, if such extension would cause payment of
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(f) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to any Lender Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.12. Taxes. (a) Any and all payments by the Borrower hereunder or
under the Notes shall be made, in accordance with Section 2.11, free and clear
of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender Party and the Administrative
Agent, net income taxes that are imposed by the United States and net income
taxes (or franchise taxes imposed in lieu thereof) that are imposed on such
Lender Party or the Administrative Agent by the state or foreign jurisdiction
under the laws of which such Lender Party or the Administrative Agent (as the
case may be) is organized or any political subdivision thereof and, in the case
of each Lender Party, net income taxes (or franchise taxes imposed in lieu
thereof) that are imposed on such Lender Party by the state or foreign
jurisdiction of such Lender Party's Applicable Lending Office or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities in respect of payments hereunder or under
the Notes being hereinafter referred to as "Taxes"). If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any Note to any Lender Party or the Administrative Agent, (i)
the sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.12) such Lender Party or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp,
documentary, excise, property or similar taxes, charges or levies that arise
from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performing under, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other Taxes").
(c) The Borrower shall indemnify each Lender Party and the Administrative
Agent for the full amount of Taxes and Other Taxes, and for the full amount of
taxes imposed by any jurisdiction on amounts payable under this Section 2.12,
imposed on or paid by such Lender Party or the Administrative Agent (as the case
may be) and any liability (including penalties, additions to tax, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall
be made within 30 days from the date such Lender Party or the Administrative
Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
shall furnish to the Administrative Agent, at its address referred to in
Section 8.02, the original receipt of payment thereof or a certified copy of
such receipt. In the case of any payment hereunder or under the Notes by or on
behalf of the Borrower through an account or branch outside the United States or
by or on behalf of the Borrower by a payor that is not a United States person,
if the Borrower determines that no Taxes are payable in respect thereof, the
Borrower shall furnish, or shall cause such payor to furnish, to the
Administrative Agent, at such address, an opinion of counsel acceptable to the
Administrative Agent stating that such payment is exempt from Taxes. For
purposes of this subsection (d) and subsection (e), the terms "United States"
and "United States person" shall have the meanings specified in Section 7701 of
the Internal Revenue Code.
(e) Each Lender Party organized under the laws of a jurisdiction outside
the United States shall, on or prior to the date of its execution and delivery
of this Agreement in the case of each Initial Lender or Initial Issuing Bank, as
the case may be, and on the date of the Assignment and Acceptance pursuant to
which it became a Lender Party in the case of each other Lender Party, and from
time to time thereafter as requested in writing by the Borrower or the
Administrative Agent (but only so long thereafter as such Lender Party remains
lawfully able to do so), provide each of the Administrative Agent and the
Borrower with two original Internal Revenue Service forms 1001 or 4224, as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that such Lender is exempt from or entitled to a reduced
rate of United States withholding tax on payments pursuant to this Agreement or
the Notes. If the forms provided by a Lender Party at the time such Lender Party
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender Party provides the
appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such form; provided, however, that, if at the date of the Assignment
and Acceptance pursuant to which a Lender Party becomes a party to this
Agreement, the Lender Party assignor was entitled to payments under
subsection (a) in respect of United States withholding tax with respect to
interest paid at such date, then, to such extent, the term Taxes shall include
(in addition to withholding taxes that may be imposed in the future or other
amounts otherwise includable in Taxes) United States withholding tax, if any,
applicable with respect to the Lender Party assignee on such date. If any form
or document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service form 1001 or
Lender Party reasonably considers to be confidential, the Lender Party
shall give notice thereof to the Borrower and shall not be obligated to include
in such form or document such confidential information.
(f) For any period with respect to which a Lender Party has failed to
provide the Borrower with the appropriate form described in subsection (e)
(other than if such failure is due to a change in law occurring after the date
on which a form originally was required to be provided or if such form otherwise
is not required under subsection (e)), such Lender Party shall not be entitled
to indemnification under subsection (a) or (c) with respect to Taxes imposed by
the United States by reason of such failure; provided, however, that should a
Lender Party become subject to Taxes because of its failure to deliver a form
required hereunder, the Borrower shall take such steps as such Lender Party
shall reasonably request to assist such Lender Party to recover such Taxes.
(g) Any Lender Party claiming any additional amounts payable pursuant to
this Section 2.12 agrees to use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
Eurodollar Lending Office if the making of such a change would avoid the need
for, or reduce the amount of, any such additional amounts that may thereafter
accrue and would not, in the reasonable judgment of such Lender Party, be
otherwise disadvantageous to such Lender Party.
SECTION 2.13. Sharing of Payments, Etc. If any Lender Party shall obtain at
any time any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise) (a) on account of Obligations due and
payable to such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of (i) the amount of
such Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time obtained by all the Lender Parties at such time or (b) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations owing to such Lender Party
at such time to (ii) the aggregate amount of the Obligations owing (but not due
and payable) to all Lender Parties hereunder and under the Notes at such time)
of payments on account of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes at such time obtained by all of the
Lender Parties at such time, such Lender Party shall forthwith purchase from the
other Lender Parties such participations in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such
purchasing Lender Party to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender Party, such purchase from each
other Lender Party shall be rescinded and such other Lender Party shall repay to
the purchasing Lender Party the purchase price to the extent of such Lender
Party's ratable share (according to the proportion of (i) the purchase price
paid to such Lender Party to (ii) the aggregate purchase price paid to all
Lender Parties) of such recovery together with an amount equal to such Lender
Party's ratable share (according to the proportion of (i) the amount of such
other Lender Party's required repayment to (ii) the total amount so recovered
from the purchasing Lender Party) of any interest or other amount paid or
payable by the purchasing Lender Party in respect of the total amount so
The Borrower agrees that any Lender Party so purchasing a participation from
another Lender Party pursuant to this Section 2.13 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender Party
were the direct creditor of the Borrower in the amount of such participation.
SECTION 2.14. Use of Proceeds. The proceeds of the Advances and issuances
of Letters of Credit shall be available (and the Borrower agrees that it shall
use such proceeds and Letters of Credit) solely to pay to the Company and the
other owners of the Acquired Assets and Liabilities the consideration to be
received by them from PSC and PSC Acquisition pursuant to the Purchase
Agreement, pay transaction fees and expenses and provide working capital for PSC
and its Subsidiaries.
SECTION 2.15. Defaulting Lenders. (a) In the event that, at any one time,
(i) any Lender Party shall be a Defaulting Lender, (ii) such Defaulting Lender
shall owe a Defaulted Advance to the Borrower and (iii) the Borrower shall be
required to make any payment hereunder or under any other Loan Document to or
for the account of such Defaulting Lender, then the Borrower may, so long as no
Default shall occur or be continuing at such time and to the fullest extent
permitted by applicable law, set off and otherwise apply the Obligation of the
Borrower to make such payment to or for the account of such Defaulting Lender
against the obligation of such Defaulting Lender to make such Defaulted Advance.
In the event that, on any date, the Borrower shall so set off and otherwise
apply its obligation to make any such payment against the obligation of such
Defaulting Lender to make any such Defaulted Advance on or prior to such date,
the amount so set off and otherwise applied by the Borrower shall constitute for
all purposes of this Agreement and the other Loan Documents an Advance by such
Defaulting Lender made on the date under the Facility pursuant to which such
Defaulted Advance was originally required to have been made pursuant to
Section 2.01. Such Advance shall be a Prime Rate Advance and shall be
considered, for all purposes of this Agreement, to comprise part of the
Borrowing in connection with which such Defaulted Advance was originally
required to have been made pursuant to Section 2.01, even if the other Advances
comprising such Borrowing shall be Eurodollar Rate Advances on the date such
Advance is deemed to be made pursuant to this subsection (a). The Borrower shall
notify the Administrative Agent at any time the Borrower exercises its right of
set-off pursuant to this subsection (a) and shall set forth in such notice (A)
the name of the Defaulting Lender and the Defaulted Advance required to be made
by such Defaulting Lender and (B) the amount set off and otherwise applied in
respect of such Defaulted Advance pursuant to this subsection (a). Any portion
of such payment otherwise required to be made by the Borrower to or for the
account of such Defaulting Lender which is paid by the Borrower, after giving
effect to the amount set off and otherwise applied by the Borrower pursuant to
this subsection (a), shall be applied by the Administrative Agent as specified
in subsection (b) or (c) of this Section 2.15.
(b) In the event that, at any one time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount to
the Administrative Agent or any of the other Lender Parties and (iii) the
Borrower shall make any payment hereunder or under any other Loan Document to
the Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Lender
Parties and to the fullest extent permitted by applicable law, apply at such
time the amount so paid by the Borrower to or for the account of such Defaulting
Lender to the payment of each such Defaulted Amount to the extent required to
pay such Defaulted Amount. In the event that the Administrative Agent shall so
apply any such amount to the payment of any such Defaulted Amount on any date,
the amount so applied by the Administrative Agent shall constitute for all
purposes of this Agreement and the other Loan Documents payment, to such extent,
of such Defaulted Amount on such date. Any such amount so applied by the
Administrative Agent shall be retained by the Administrative Agent or
distributed by the Administrative Agent to such other Lender Parties, ratably in
accordance with the respective portions of such Defaulted Amounts payable at
such time to the Administrative Agent and such other Lender Parties and, if the
amount of such payment made by the Borrower shall at such time be insufficient
to pay all Defaulted Amounts owing at such time to the Administrative Agent and
the other Lender Parties, in the following order of priority:
(i) first, to the Administrative Agent for any Defaulted Amount then
owing to the Administrative Agent; and
(ii) second, to the Lender Parties for any Defaulted Amounts then
owing to such Lender Parties, ratably in accordance with such respective
Defaulted Amounts then owing to such Lender Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.15.
(c) In the event that, at any one time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted Advance
or a Defaulted Amount and (iii) the Borrower, the Administrative Agent or any
other Lender Party shall be required to pay or distribute any amount hereunder
or under any other Loan Document to or for the account of such Defaulting
Lender, then the Borrower or such other Lender Party shall pay such amount to
the Administrative Agent to be held by the Administrative Agent, to the fullest
extent permitted by applicable law, in escrow or the Administrative Agent shall,
to the fullest extent permitted by applicable law, hold in escrow such amount
otherwise held by it. Any funds held by the Administrative Agent in escrow under
this subsection (c) shall be deposited by the Administrative Agent in an account
with Fleet, in the name and under the control of the Administrative Agent, but
subject to the provisions of this subsection (c). The terms applicable to such
account, including the rate of interest payable with respect to the credit
balance of such account from time to time, shall be Fleet's standard terms
applicable to escrow accounts maintained with it. Any interest credited to such
account from time to time shall be held by the Administrative Agent in escrow
under, and applied by the Administrative Agent from time to time in accordance
with the provisions of, this subsection (c). The Administrative Agent shall, to
the fullest extent permitted by applicable law, apply all funds so held in
escrow from time to time to the extent necessary to make any Advances required
to be made by such Defaulting Lender and to pay any amount payable by such
Defaulting Lender hereunder and under the other Loan Documents to the
Administrative Agent or any other Lender Party, as and when such Advances or
amounts are required to be made or paid and, if the amount so held in escrow
shall at any time be insufficient to make and pay all such Advances and amounts
required to be made or paid at such time, in the following order of priority:
(i) first, to the Administrative Agent for any amount then due and
payable by such Defaulting Lender to the Administrative Agent hereunder;
(ii) second, to the Lender Parties for any amount then due and payable
by such Defaulting Lender to such Lender Parties hereunder, ratably in
accordance with such respective amounts then due and payable to such Lender
Parties; and
(iii) third, to the Borrower for any Advance then required to be made
by such Defaulting Lender pursuant to a Commitment of such Defaulting
Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender Party to the Obligations owing to such Lender Party at such time under
this Agreement and the other Loan Documents ratably in accordance with the
respective amounts of such Obligations outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under this
Section 2.15 are in addition to other rights and remedies that the Borrower
may have against such Defaulting Lender with respect to any Defaulted
Advance and that the Administrative Agent or any Lender Party may have
against such Defaulting Lender with respect to any Defaulted Amount.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Extension of Credit. The
obligation of each Lender to make an Advance or of the Issuing Bank to issue a
Letter of Credit on the occasion of the Initial Extension of Credit hereunder is
subject to the satisfaction of the following conditions precedent before or
concurrently with the Initial Extension of Credit:
(a) The Acquisition shall have been consummated substantially in
accordance with the terms of the Purchase Agreement, without any waiver or
amendment not consented to by the Lender Parties of any term, provision or
condition set forth therein, and in compliance with all applicable laws and
all necessary approvals; the Merger shall have been consummated
substantially in accordance with the terms of the Merger Agreement, without
any waiver or amendment not consented to by the Lender Parties of any term,
provision or condition set forth therein, and the Lender Parties shall be
satisfied that any applicable state takeover law and any supermajority
provisions in the charter of Scanning are not applicable to the Merger or
that any conditions to avoiding such restrictions have been satisfied.
(b) Each of the Merger Agreement and the Purchase Agreement shall be
in full force and effect.
(c) The Lender Parties shall be reasonably satisfied with the
corporate and legal structure and capitalization of each Loan Party and
each of its Subsidiaries, including the terms and conditions of the
charter, bylaws and each class of capital stock of each Loan Party and each
such Subsidiary and of each agreement or instrument relating to such
structure or capitalization.
(d) The Borrower shall have received at least $30,000,000 in gross
cash proceeds from the sale of the Subordinated Notes and the principal
amount of the Seller Note shall not be in excess of $5,000,000.
(e) The Lender Parties shall be satisfied that all Existing Debt,
other than the Debt identified on Schedule 3.01(e) (the "Surviving Debt"),
has been prepaid, redeemed or defeased in full or otherwise satisfied and
extinguished and that all such Surviving Debt shall be on terms and
conditions satisfactory to the Lender Parties.
(f) There shall have occurred no material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of (i) either PSC and its Subsidiaries, taken as a
whole, since December 31, 1995, or (ii) PSC Acquisition, on an individual
basis, or (iii) either Scanning and its Subsidiaries taken as a whole, or
the Acquired Assets and Liabilities, since December 31, 1995.
(g) Other than the litigation described in Schedule 3.01(g) (the
"Disclosed Litigation"), there shall exist no action, suit, investigation,
litigation or proceeding pending or threatened in any court or before any
arbitrator or governmental or regulatory agency or authority that (i) could
reasonably be expected to (A) have a material adverse effect on the
business, condition (financial or otherwise), operations, performance,
properties or prospects of PSC and its Subsidiaries, taken as a whole, PSC
Acquisition, on an individual basis, the Company and its Subsidiaries,
taken as a whole, or any of the Acquired Assets and Liabilities,
(B) materially adversely affect the ability of the Borrower or any
Guarantor to perform its obligations under the Loan Documents or
(C) materially adversely affect the rights and remedies of the
Administrative Agent and the Lender Parties under the Loan Documents or
(ii) purports to materially adversely affect any aspect of the Transaction
or the Facilities (collectively, a "Material Adverse Effect"); and there
shall have been no material adverse change in the status, or financial
effect on the Borrower or any of its Subsidiaries or Scanning or any of its
Subsidiaries, of the Disclosed Litigation from that described on Schedule
3.01(g).
(h) All governmental and third party consents and approvals necessary
in connection with each aspect of the Purchase Agreement, the Acquisition,
the Merger, the Securities Purchase Agreements and the Facilities shall
have been obtained (without the imposition of any conditions that are not
acceptable to the Initial Lenders) and shall remain in effect; all
applicable waiting periods shall have expired without any adverse action
being taken by any competent authority; and no law or regulation shall be
applicable in the reasonable judgment of the Lender Parties that restrains,
prevents or imposes materially adverse conditions upon any aspect of the
Purchase Agreement, the Acquisition, the Merger, the Securities Purchase
Agreements or the Facilities.
(i) The Lender Parties shall have completed a due diligence
investigation of PSC, and its Subsidiaries and Scanning in scope, and with
results, reasonably satisfactory to the Lender Parties, and nothing shall
have come to the attention of the Lender Parties during the course of such
due diligence investigation to lead them to believe (i) that the
Information Memorandum was or has become misleading, incorrect or
incomplete in any material respect, (ii) that, following the consummation
of the Acquisition, the Borrower and its Subsidiaries would not have good
and marketable title to all material assets of Scanning and its
Subsidiaries reflected in the Information Memorandum and (iii) that the
Acquisition will have a Material Adverse Effect; without limiting the
generality of the foregoing, the Lender Parties shall have been given such
access to the management, records, books of account, contracts and
properties of PSC, its Subsidiaries and Scanning as they shall have
requested.
(j) All of the information provided by or on behalf of PSC or any of
its Subsidiaries or by or on behalf of the Company or any of its
Subsidiaries to the Administrative Agent and the Lender Parties prior to
their commitment in respect of the Facilities (the "Pre-Commitment
Information") shall be true and correct in all material aspects, and no
development or change shall have occurred, and no additional information
shall have come to the attention of the Administrative Agent or the
Lenders, that (i) has resulted in or could reasonably be expected to result
in a material change in, or material deviation from, the Pre-Commitment
Information or (ii) has had or could reasonably be expected to have a
Material Adverse Effect.
(k) The Borrower shall have paid all accrued fees and expenses of the
Administrative Agent and the Lender Parties (including the accrued fees and
expenses of counsel to the Administrative Agent and M&T).
(l) The Administrative Agent shall have received on or before the day
of the Initial Extension of Credit the following, each dated such day
(unless otherwise specified), in form and substance satisfactory to the
Administrative Agent (unless otherwise specified) and (except for the
Notes) in sufficient copies for each Lender Party:
(i) The Notes payable to the order of the Lenders.
(ii) Certified copies of (A) the resolutions of the Board of
Directors of the Borrower, Scanning, PSC and each other Loan Party
approving the Acquisition, the Merger, this Agreement, the Notes, each
other Loan Document and each Related Document to which it is or is to
be a party, and of all documents evidencing other necessary corporate
action and governmental and other third party approvals and consents,
if any, with respect to the Acquisition, the Merger, this Agreement,
the Notes, each other Loan Document and each Related Document and (B)
the resolution of the Board of Directors of COMIDA approving the New
York Mortgage.
(iii) (A) A copy of the charter of the Borrower, Scanning, the
Company and each other Loan Party and each amendment thereto,
certified (as of a date reasonably near the date of the Initial
Extension of Credit) by the Secretary of State of the jurisdiction of
its incorporation as being a true and correct copy thereof and (B) a
copy of the organizational documents of COMIDA and each amendment
thereto, certified (as of a date reasonably near the date of the
Initial Extension of Credit) by the appropriate agency of the State of
New York as being a true and correct copy thereof.
(iv) A copy of a certificate of the Secretary of State of the
jurisdiction of its incorporation, dated within 7 days of the date of
the Initial Extension of Credit, listing the charter of the Borrower,
PSC, Scanning, the Company and each other Loan Party and each
amendment thereto on file in his office and certifying that (A) such
amendments are the only amendments to the Borrower's, PSC's,
Scanning's or such other Loan Party's charter on file in his office,
(B) the Borrower, PSC, Scanning and each other Loan Party have paid
all franchise taxes to the date of such certificate and (C) the
Borrower, PSC, Scanning and each other Loan Party are duly
incorporated and in good standing under the laws of the State of the
jurisdiction of its incorporation.
(v) A copy of a certificate of the Secretary of State of each
State listed on Schedule 3.01(l)(vi), dated reasonably near the date
of the Initial Extension of Credit, stating that PSC and Scanning are
duly qualified and in good standing as foreign corporations in such
State and have filed all annual reports required to be filed to the
date of such certificate.
(vi) Copies of a certificate of merger or other confirmation from
the Secretary of State of the State of Delaware of the consummation of
the Merger.
(vii) A certificate of the Borrower, PSC, Scanning and each other
Loan Party signed on behalf of the Borrower, PSC, Scanning and such
other Loan Party by its President or a Vice President and its
Secretary or any Assistant Secretary, dated the date of the Initial
Extension of Credit (the statements made in which certificate shall be
true on and as of the date of the Initial Extension of Credit),
certifying as to (A) the absence of any amendments to the charter of
the Borrower, PSC, Scanning or such other Loan Party since the date of
the Secretary of State's certificate referred to in
Section 3.01(l)(iv), (B) a true and correct copy of the bylaws of the
Borrower, PSC, Scanning and such other Loan Party as in effect on the
date of the Initial Extension of Credit, (C) the due incorporation and
good standing of each of the Borrower, PSC, Scanning and such other
Loan Party as a corporation organized under the laws of the
jurisdiction of its incorporation, and the absence of any proceeding
for the dissolution or liquidation of the Borrower, PSC, Scanning or
such other Loan Party, (D) the truth of the representations and
warranties contained in the Loan Documents as though made on and as of
the date of the Initial Extension of Credit and (E) the absence of any
event occurring and continuing, or resulting from the Initial
Extension of Credit, that constitutes a Default.
(viii) A certificate of the Secretary or an Assistant Secretary
of the Borrower, PSC, Scanning and each other Loan Party certifying
the names and true signatures of the officers of the Borrower, PSC,
Scanning and such other Loan Party authorized to sign this Agreement,
the Notes, each other Loan Document and each Related Document to which
they are or are to be parties and the other documents to be delivered
hereunder and thereunder.
(ix) A security agreement in substantially the form of Exhibit D
(together with each other security agreement delivered pursuant to
Section 5.01(o), in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms, the "Security
Agreement"), duly executed by the Borrower, PSC and each Subsidiary
Guarantor, together with:
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers
executed in blank and instruments evidencing the Pledged
Debt referred to therein indorsed in blank,
(B) acknowledgment copies or stamped receipt copies of
proper financing statements, duly filed on or before the day
of the Initial Extension of Credit (or other confirmation
reasonably satisfactory to the Administrative Agent of such
filing) under the Uniform Commercial Code of all
jurisdictions that the Administrative Agent may deem
necessary or desirable in order to perfect and protect the
first priority liens and security interests created under
the Security Agreement, covering the Collateral described in
the Security Agreement,
(C) completed requests for information, dated on or
before the date of the Initial Extension of Credit, listing
the financing statements referred to in clause (B) above and
all other effective financing statements filed in the
jurisdictions referred to in clause (B) above that name the
Borrower, the Company or any other Loan Party as debtor,
together with copies of such other financing statements,
(D) evidence of the completion of all other recordings
and filings of or with respect to the Security Agreement
that the Administrative Agent may deem necessary or
reasonably desirable in order to perfect and protect the
Liens created thereby,
(E) evidence of the insurance required by the terms of
the Security Agreement,
(F) copies of the Assigned Agreements referred to in
the Security Agreement, together with a consent to such
assignment, in substantially the form of Exhibit C to the
Security Agreement, duly executed by each party to such
Assigned Agreements other than the Borrower, and
(G) evidence that all other action that the
Administrative Agent may deem necessary or reasonably
desirable in order to perfect and protect the first priority
liens and security interests created under the Security
Agreement has been taken.
(x) An intellectual property security agreement in substantially
the form of Exhibit E (together with each other intellectual property
security agreement delivered pursuant to Section 5.01(o), in each case
as amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "Intellectual Property Security
Agreement"), duly executed by the Borrower, PSC and each Subsidiary
Guarantor, together with evidence that all action that the
Administrative Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security interests
created under the Intellectual Property Security Agreement has been
taken.
(xi) (A) Deed of trust, trust deed, mortgage, leasehold mortgage
and leasehold deed of trust in substantially the form of Exhibit F-1
and covering the properties listed on Schedule 3.01(l)(xi) and located
in the State of New York (as amended, supplemented or otherwise
modified from time to time, the "New York Mortgage"), duly executed by
PSC, and a deed of trust, trust deed, mortgage, leasehold mortgage and
leasehold deed of trust in substantially the form of Exhibit F-2 and
covering the properties listed on Schedule 3.10(l)(xi) and located in
the State of Oregon (as amended, supplemented or otherwise modified
from time to time, the "Oregon Deed of Trust"), duly executed by the
Borrower, together with:
(A) evidence that counterparts of the Mortgages have been
duly recorded on or before the day of the Initial Extension of
Credit in all filing or recording offices that the Administrative
Agent may deem necessary or desirable in order to create a valid
first and subsisting Lien on the property described therein in
favor of the Secured Parties and that all filing and recording
taxes and fees have been paid,
(B) fully paid American Land Title Association Lender's
Extended Coverage title insurance policies (the "Mortgage
Policies") in form and substance, with endorsements and in amount
acceptable to the Administrative Agent, issued, coinsured and
reinsured by title insurers acceptable to the Administrative
Agent, insuring the Mortgages to be valid first and subsisting
Liens on the property described therein, free and clear of all
defects (including, but not limited to, mechanics' and
materialmen's Liens) and encumbrances, excepting only Permitted
Encumbrances, and providing for such other affirmative insurance
(including endorsements for future advances under the Loan
Documents and for mechanics' and materialmen's Liens) and such
coinsurance and direct access reinsurance as the Administrative
Agent may deem necessary or desirable,
(C) American Land Title Association form surveys, dated no
more than 30 days before the day of the Initial Extension of
Credit, certified to the Administrative Agent and the issuer of
the Mortgage Policies in a manner reasonably satisfactory to the
Administrative Agent by a land surveyor duly registered and
licensed in the States in which the property described in such
surveys is located and acceptable to the Administrative Agent,
showing all buildings and other improvements, any off-site
improvements, the location of any easements, parking spaces,
rights of way, building set-back lines and other dimensional
regulations and the absence of encroachments, either by such
improvements or on to such property, and other defects, other
than encroachments and other defects reasonably acceptable to the
Administrative Agent,
(D) such consents and agreements of lessors and other third
parties, and such estoppel letters and other confirmations, as
the Administrative Agent may deem necessary or desirable,
(E) evidence of the insurance required by the terms of the
Mortgages,
(F) signed copies of proper financing statements for filing
under the Uniform Commercial Code of all jurisdictions that the
Administrative Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security
interests created under the Mortgages in fixtures, and
(G) evidence that all other action that the Administrative
Agent may deem necessary or desirable in order to create valid
first and subsisting Liens on the property described in the
Mortgages has been taken.
hereafter amended, the "Subsidiary Guaranty," duly executed by each
Subsidiary Guarantor.
(xiii) An assumption agreement in substantially the form of
Exhibit H (the "Assumption Agreement"), duly executed by the Surviving
Corporation.
(xiv) (A) Certified copies of each of the Related Documents, in
each case duly executed by the parties thereto and in form and
substance reasonably satisfactory to the Lender Parties, together with
all agreements, instruments and other documents delivered in
connection therewith, and a certificate of PSC to the effect that the
aggregate amount of transaction fees payable pursuant to the
Transaction does not exceed the amount previously disclosed in the
Pre-Commitment Information and (B) certified copies of notices (the
"IRB Notices"), in form and substance reasonably acceptable to the
Administrative Agent, of the redemption on January 1, 1997 of the
industrial revenue bonds issued pursuant to the IRB Documents.
(xv) Such financial, business and other information regarding
each Loan Party and its Subsidiaries as the Lender Parties shall have
reasonably requested, including, without limitation, information as to
possible contingent liabilities, tax matters, environmental matters,
obligations under Plans, Multiemployer Plans and Welfare Plans,
collective bargaining agreements and other arrangements with
employees, audited annual financial statements dated December 31,
1995, interim financial statements dated the end of the most recent
fiscal quarter for which financial statements are available (or, in
the event the Lender Parties' due diligence review reveals material
changes since such financial statements, as of a later date within
45 days of the day of the Initial Extension of Credit), pro forma
financial statements as to the Borrower and forecasts prepared by
management of PSC, in form and substance reasonably satisfactory to
the Lender Parties.
(xvi) Certificates, in substantially the form of Exhibit I,
attesting to the Solvency of each Loan Party after giving effect to
the Acquisition, the Merger and the other transactions contemplated
hereby, from its chief financial officer.
(xvii) The environmental assessment reports listed on Schedule
3.01(l)(xvii).
(xviii) Evidence of insurance naming the Administrative Agent as
insured and loss payee with such responsible and reputable insurance
companies or associations, and in such amounts and covering such
risks, as is reasonably satisfactory to the Lender Parties, including,
without limitation, business interruption insurance.
(xix) Certified copies of each employment agreement and other
compensation arrangement with each executive officer of any Loan Party
or any of its Subsidiaries.
(xx) Certified copies of all Material Contracts of each Loan
Party and its Subsidiaries.
(xxi) A special warranty deed from the Company to Scanning, in
form and substance satisfactory to the Administrative Agent, conveying
to Scanning (i) all the Company's present right, title and interest in
and to the IRB Property and (ii) all right, title and interest that
the Company may thereafter acquire in and to the IRB Property.
(xxii) Borrowing Base Certificate.
1
(xxiii) (A) A favorable opinion of Boylan, Brown, Code, Fowler,
Vigdor & Wilson, counsel for the Borrower, in substantially the form
of Exhibit J hereto and as to such other matters as any Lender Party
through the Administrative Agent may reasonably request, (B) a
favorable opinion of Fried, Frank, Harris, Shriver & Jacobson,
intellectual property counsel to the Loan Parties, in form and
substance reasonably satisfactory to the Lender Parties, (C) a letter
from Dechert Price & Rhoads, counsel for SP Holdings and the Company,
authorizing the Lender Parties and the Administrative Agent to rely on
their opinion delivered pursuant to the Purchase Agreement and (D) a
favorable opinion of Gates & Adams, counsel for COMIDA, in form and
substance reasonably satisfactory to the Lender Parties.
(xxiv) A favorable opinion of Stoel, Rives local counsel to the
Lender Parties in Oregon in substantially the form of Exhibit K hereto
and as to such other matters as any Lender Party through the
Administrative Agent may reasonably request.
(xxv) A favorable opinion of Pennie & Edmonds, intellectual
property counsel to the Lender Parties, in substantially the form of
Exhibit L hereto and as to such other matters as any Lender Party
through the Administrative Agent may reasonably request.
(xxvi) A favorable opinion of Shearman & Sterling, counsel for
the Administrative Agent, in form and substance reasonably
satisfactory to the Administrative Agent.
(m) PSC shall have paid in full all amounts due to M&T under the terms
of the $20,000,000 Amended and Restated Credit Facility Agreement dated as
of September 28, 1995, provided to PSC by M&T and shall have terminated the
commitment, and all other obligations, of M&T thereunder.
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance. The
obligation of each Appropriate Lender to make an Advance (other than a Letter of
Credit Advance made by the Issuing Bank or a Working Capital Lender pursuant to
Section 2.03(c) and a Swing Line Advance made by a Working Capital Lender
pursuant to Section 2.02(b) on the occasion of each Borrowing (including the
Initial Extension of Credit), and the obligation of the Issuing Bank to issue a
Letter of Credit (including the initial issuance) or renew a Letter of Credit,
and the right of the Borrower to request a Swing Line Borrowing or the issuance
or renewal of a Letter of Credit shall be subject to the further conditions
precedent that on the date of such Borrowing or issuance or renewal (a) the
following statements shall be true and the Administrative Agent shall have
received for the account of such Lender Party or the Issuing Bank a certificate
signed by a duly authorized officer of the Borrower, dated the date of such
Borrowing or issuance or renewal, stating that (and each of the giving of the
applicable Notice of Borrowing, Notice of Swing Line Borrowing or Notice of
Issuance or Notice of Renewal and the acceptance by the Borrower of the proceeds
of such Borrowing or of such Letter of Credit or the renewal of such Letter of
Credit shall constitute a representation and warranty by the Borrower that both
on the date of such notice and on the date of such Borrowing or issuance or
renewal such statements are true):
(i) the representations and warranties contained in each Loan Document
are correct on and as of such date, before and after giving effect to such
Borrowing or issuance or renewal and to the application of the proceeds
therefrom, as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result from
such Borrowing or issuance or renewal or from the application of the
proceeds therefrom, that constitutes a Default; and
(iii) for each Working Capital Advance or Swing Line Advance made by
the Swing Line Bank or issuance or renewal of any Letter of Credit, the
Borrowing Base exceeds the aggregate principal amount of the Working
Capital Advances plus Swing Line Advances plus Letter of Credit Advances to
be outstanding plus the aggregate Available Amount of all Letters of Credit
then outstanding after giving effect to such Advance or issuance or
renewal, respectively;
and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender through the Administrative Agent
may reasonably request.
SECTION 3.03. Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Initial Extension of Credit specifying its objection thereto
and if the Initial Extension of Credit consists of a Borrowing, such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of PSC and the Borrower. Each
of PSC and the Borrower represents and warrants as follows:
(a) Each Loan Party (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, (ii) is duly qualified and in good standing as a foreign
corporation in each other jurisdiction in which it owns or leases property
or in which the conduct of its business requires it to so qualify or be
licensed except where the failure to so qualify or be licensed could not
reasonably be expected to have a Material Adverse Effect and (iii) has all
requisite corporate power and authority (including, without limitation, all
governmental licenses, permits and other approvals) to own or lease and
operate its properties and to carry on its business as now conducted and as
proposed to be conducted. All of the outstanding capital stock of the
Borrower has been validly issued, is
fully paid and non-assessable and is owned by PSC free and clear of all
Liens, except those created under the Collateral Documents.
(b) Set forth on Schedule 4.01(b) hereto is a complete and accurate
list of all Subsidiaries of each Loan Party, showing as of the date hereof
(as to each such Subsidiary) the jurisdiction of its incorporation, the
number of shares of each class of capital stock authorized, and the number
outstanding, on the date hereof and the percentage of the outstanding
shares of each such class owned (directly or indirectly) by such Loan Party
and the number of shares covered by all outstanding options, warrants,
rights of conversion or purchase and similar rights at the date hereof. All
of the outstanding capital stock of all of such Subsidiaries has been
validly issued, is fully paid and non-assessable and is owned by such Loan
Party or one or more of its Subsidiaries free and clear of all Liens,
except those created under the Loan Documents. Each such Subsidiary (i) is
a corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation, (ii) is duly qualified
and in good standing as a foreign corporation in each other jurisdiction in
which it owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed except where the failure to so
qualify or be licensed could not reasonably be expected to have a Material
Adverse Effect and (iii) has all requisite corporate power and authority
(including, without limitation, all governmental licenses, permits and
other approvals) to own or lease and operate its properties and to carry on
its business as now conducted and as proposed to be conducted.
(c) The execution, delivery and performance by each Loan Party of this
Agreement, the Notes, each other Loan Document and each Related Document to
which it is or is to be a party, and the consummation of the Merger and the
other transactions contemplated hereby, are within such Loan Party's
corporate powers, have been duly authorized by all necessary corporate
action, and do not (i) contravene such Loan Party's charter or bylaws,
(ii)violate any law (including, without limitation, the Securities
Exchange Act of 1934 and the Racketeer Influenced and Corrupt Organizations
Chapter of the Organized Crime Control Act of 1970), rule, regulation
(including, without limitation, Regulation X of the Board of Governors of
the Federal Reserve System), order, writ, judgment, injunction, decree,
determination or award, (iii) conflict with or result in the breach of, or
constitute a default under, any material contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding on or
affecting any Loan Party, any of its Subsidiaries or any of their
properties or (iv) except for the Liens created under the Loan Documents,
result in or require the creation or imposition of any Lien upon or with
respect to any of the properties of any Loan Party or any of its
Subsidiaries. No Loan Party or any of its Subsidiaries is in violation of
any such law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or in breach of any such contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument, the
violation or breach of which could reasonably be expected to have a
Material Adverse Effect.
(d) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body or any other
third party is required for (i) the due execution, delivery, recordation,
filing or performance by any Loan Party of this Agreement, the Notes, any
other Loan Document or any Related Document to which it is or is to be a
party, or for the consummation of the Acquisition, the Merger or the other
transactions contemplated hereby, (ii) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, (iii) the
perfection or maintenance of the Liens created by the Collateral Documents
(including the first priority nature thereof) or (iv)the exercise by the
Administrative Agent or any Lender Party of its rights under the Loan
Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents, except for the authorizations, approvals, actions,
notices and filings listed on Schedule 4.01(d), all of which have been duly
obtained, taken, given or made and are in full force and effect. All
applicable waiting periods in connection with the Acquisition, the Merger
and the other transactions contemplated hereby have expired without any
action having been taken by any competent authority restraining, preventing
or imposing materially adverse conditions upon the Acquisition, the Merger
or the rights of the Loan Parties or their Subsidiaries freely to transfer
or otherwise dispose of, or to create any Lien on, any properties now owned
or hereafter acquired by any of them.
(e) This Agreement has been, and each of the Notes, each other Loan
Document and each Related Document when delivered hereunder will have been,
duly executed and delivered by each Loan Party thereto. This Agreement is,
and each of the Notes, each other Loan Document and each Related Document
when delivered hereunder will be, the legal, valid and binding obligation
of each Loan Party thereto, enforceable against such Loan Party in
accordance with its terms.
(f) (i) The Consolidated and consolidating balance sheets of the
Company and its Subsidiaries as at December 31, 1995, and the related
Consolidated and consolidating statements of income and Consolidated
statement of cash flows of the Company and its Subsidiaries for the fiscal
year then ended, accompanied by (in the case of such consolidated financial
statements) an opinion of Coopers & Lybrand, independent public
accountants, and the Consolidated balance sheet of the Company and its
Subsidiaries as at March 31, 1996, and the related Consolidated statement
of income and Consolidated statement of cash flows of the Company and its
Subsidiaries for the three months then ended, duly certified by the chief
executive officer or the chief financial officer of the Company, copies of
which have been furnished to each Lender Party, fairly present, subject, in
the case of said balance sheet as at March 31, 1996, and said statements of
income and cash flows for the three months then ended, to year-end audit
adjustments, the Consolidated (and, with respect to the balance sheets
dated December 31, 1995, consolidating) financial condition of the Company
and its Subsidiaries as at such dates and the Consolidated (and, with
respect to the statements of income dated December 31, 1995, consolidating)
results of the operations of the Company and its Subsidiaries for the
period ended on such date, all in accordance with generally accepted
accounting principles applied on a consistent basis, and since December 31,
1995, there has been no Material Adverse Change.
(ii) The Consolidated and consolidating balance sheets of PSC and its
Subsidiaries as at December 31, 1995, and the related Consolidated and
consolidating statements of income and Consolidated statement of cash flows
of PSC and its Subsidiaries for the fiscal year then ended, accompanied by
(in the case such Consolidated financial statements) an opinion of Arthur
Anderson, independent public accountants, and the Consolidated balance
sheet of PSC and its Subsidiaries as at March 31, 1996, and the related
Consolidated statement of income and Consolidated statement of cash flows
of PSC and its Subsidiaries for the three months then ended, duly certified
by the chief financial officer of PSC, copies of which have been furnished
to each Lender Party, fairly present, subject, in the case of said balance
sheets as at March 31, 1996, and said statements of income and cash flows
for the three months then ended, to year-end audit adjustments, the
Consolidated (and, with respect to the balance sheets dated December 31,
1995, consolidating) financial condition of PSC and its Subsidiaries as at
such dates and the Consolidated (and, with respect to the statements of
income dated December 31, 1995, consolidating) results of the operations of
PSC and its Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles applied on a
consistent basis, and since December 31, 1995, there has been no Material
Adverse Change.
(g) The Consolidated pro forma balance sheet of PSC and its
Subsidiaries as at March 31, 1996, and the related Consolidated pro forma
statement of income and cash flows of PSC and its Subsidiaries for the
three months then ended, certified by the chief financial officer of PSC,
copies of which have been furnished to each Lender Party, fairly present
the Consolidated pro forma financial condition of PSC and its Subsidiaries
as at such date and the Consolidated pro forma results of operations of PSC
and its Subsidiaries for the period ended on such date, in each case giving
effect to the Acquisition and the other transactions contemplated hereby,
all in accordance with GAAP.
(h) The Consolidated forecasted balance sheets, income statements and
cash flows statements of PSC and its Subsidiaries delivered to the Lender
Parties pursuant to Section 3.01(l)(xv) or 5.03 were prepared in good faith
on the basis of the assumptions stated therein, which assumptions were fair
in the light of conditions existing at the time of delivery of such
forecasts, and represented, at the time of delivery, PSC's best estimate of
its future financial performance.
(i) Neither the Information Memorandum nor any other information,
exhibit or report furnished by any Loan Party to the Administrative Agent
or any Lender Party in connection with the negotiation of the Loan
Documents or pursuant to the terms of the Loan Documents contained any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements made therein not misleading.
(j) Other than the Disclosed Litigation, there is no action, suit,
investigation, litigation or proceeding affecting any Loan Party or any of
its Subsidiaries, including any Environmental Action, pending or threatened
before any court, governmental agency or arbitrator that could reasonably
be expected to have a Material Adverse Effect, and there has been no
material adverse change in the status, or financial effect on any Loan
Party or any of its Subsidiaries, of the Disclosed Litigation from that
described on Schedule 3.01(g).
(k) No proceeds of any Advance or drawings under any Letter of Credit
will be used to acquire any equity security of a class that is registered
pursuant to Section 12 of the Securities Exchange Act of 1934.
(l) Each of PSC and the Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying Margin Stock,
and no proceeds of any Advance or drawings under any Letter of Credit will
be used to purchase or carry any Margin Stock or to extend credit to others
for the purpose of purchasing or carrying any Margin Stock.
(m) Following application of the proceeds of each Advance or drawing
under each Letter of Credit, not more than 25 percent of the value of the
assets (either of PSC only or of PSC and its Subsidiaries on a Consolidated
basis) subject to the provisions of Section 5.02(a) or 5.02(e) or subject
to any restriction contained in any agreement or instrument between PSC and
any Lender Party or any Affiliate of any Lender Party relating to Debt and
within the scope of Section 6.01(e) will be Margin Stock.
(n) None of PSC, the Borrower or any of their ERISA Affiliates
maintains any Plans or Multiemployer Plans. Set forth on Schedule 4.01(n)
is a complete and accurate list of all Welfare Plans.
(o) Except as set forth in the financial statements referred to in
this Section 4.01 and in Section 5.03, the Loan Parties and their
respective Subsidiaries have no material liability with respect to
"expected post retirement benefit obligations" within the meaning of
Statement of Financial Accounting Standards No. 106.
(p) Neither the business nor the properties of any Loan Party or any
of its Subsidiaries are affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo,
act of God or of the public enemy or other casualty (whether or not covered
by insurance) that could reasonably be expected to have a Material Adverse
Effect.
(q) The operations and properties of each Loan Party and each of its
Subsidiaries comply in all known material respects with all applicable
Environmental Laws and Environmental Permits, all known past non-compliance
with such Environmental Laws and Environmental Permits has been resolved
without ongoing obligations or costs, and no circumstances exist that could
reasonably be expected to (i) form the basis of an Environmental Action
against any Loan Party or any of its Subsidiaries or any of their
properties that could reasonably be expected to have a Material Adverse
Effect or (ii) cause any such property to be subject to any restrictions on
ownership, occupancy, use or transferability under any Environmental Law.
(r) Except as disclosed in the environmental assessment reports listed
on Schedule 3.01(l)(xvii), none of the properties currently or formerly
owned or operated by any Loan Party or any of its Subsidiaries is listed or
proposed for listing on the NPL or on the CERCLIS or any analogous foreign,
state or local list or is adjacent to any such property; there are no and,
to the best of its knowledge, never have been any underground or
aboveground storage tanks or any surface impoundments, septic tanks, pits,
sumps or lagoons in which Hazardous Materials are being or, to the best of
its knowledge, have been treated, stored or disposed on any property
currently owned or operated by any Loan Party or any of its Subsidiaries
or, to the best of its knowledge, on any property formerly owned or
operated by any Loan Party or any of its Subsidiaries; there is no asbestos
or asbestos-containing material on any property currently owned or operated
by any Loan Party or any of its Subsidiaries; and Hazardous Materials have
not been released, discharged or disposed of on any property currently
owned or operated by any Loan Party or any of its Subsidiaries or any
property formerly owned or operated by any Loan Party (other than Scanning)
or any of its Subsidiaries or any property, to the best of its knowledge,
any property formerly owned or operated by Scanning or any of its
Subsidiaries.
(s) Neither any Loan Party nor any of its Subsidiaries is undertaking,
and has not completed, either individually or together with other
potentially responsible parties, any investigation or assessment or
remedial or response action relating to any actual or threatened release,
discharge or disposal of Hazardous Materials at any site, location or
operation, either voluntarily or pursuant to the order of any governmental
or regulatory authority or the requirements of any Environmental Law; and
all Hazardous Materials generated, used, treated, handled or stored at, or
transported to or from, any property currently owned or operated by any
Loan Party or any of its Subsidiaries or any property formerly owned or
operated by any Loan Party (other than Scanning) or any of its Subsidiaries
or, to the best of its knowledge, any property formerly owned or operated
by Scanning or any of its Subsidiaries have been disposed of in a manner
not reasonably expected to result in material liability to any Loan Party
or any of its Subsidiaries.
(t) Neither any Loan Party nor any of its Subsidiaries is a party to
any indenture, loan or credit agreement or any lease or other agreement or
instrument or subject to any charter or corporate restriction that could
reasonably be expected to have a Material Adverse Effect.
(u) The Collateral Documents create a valid and perfected first
priority security interest in the Collateral, securing the payment of the
Secured Obligations, and all filings and other actions necessary or
reasonably desirable to perfect and protect such security interest have
been duly taken. The Loan Parties are the legal and beneficial owners of
the Collateral free and clear of any Lien, except for the liens and
security interests created or permitted under the Loan Documents.
(v) Each Loan Party and each of its Subsidiaries has filed, has caused
to be filed or has been included in all tax returns (Federal, state, local
and foreign) required to be filed and has paid all taxes shown thereon to
be due, together with applicable interest and penalties.
(w) Set forth on Schedule 4.01(w) hereto is a complete and accurate
list, as of the date hereof, of each taxable year of each Loan Party and
each of its Subsidiaries for which Federal income tax returns have been
filed and for which the expiration of the applicable statute of limitations
for assessment or collection has not occurred by reason of extension or
otherwise (an "Open Year").
(x) There is no unpaid amount, as of the date hereof, of adjustments
to the Federal income tax liability of each Loan Party and each of its
Subsidiaries proposed by the Internal Revenue Service with respect to Open
Years. No issues have been raised by the Internal Revenue Service in
respect of Open Years that, in the aggregate, could reasonably be expected
to have a Material Adverse Effect.
(y) There is no unpaid amount, as of the date hereof, of adjustments
to the state, local and foreign tax liability of each Loan Party and its
Subsidiaries proposed by all state, local and foreign taxing authorities
(other than amounts arising from adjustments to Federal income tax
returns). No issues have been raised by such taxing authorities that, in
the aggregate, could reasonably be expected to have a Material Adverse
Effect.
(z) The Merger will not be taxable to the Company or any of its
Subsidiaries or Affiliates.
(aa) No "ownership change" as defined in Section 382(g) of the
Internal Revenue Code, and no event that would result in the application of
the "separate return limitation year" or "consolidated return change of
ownership" limitations under the Federal income tax consolidated return
regulations, has occurred with respect to PSC.
(bb) Neither any Loan Party nor any of its Subsidiaries is an
"investment company," or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended. Neither the
making of any Advances, nor the issuance of any Letters of Credit, nor the
application of the proceeds or repayment thereof by the Borrower, nor the
consummation of the other transactions contemplated hereby, will violate
any provision of such Act or any rule, regulation or order of the
Securities and Exchange Commission thereunder.
(cc) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(dd) Set forth on Schedule 4.01(dd) hereto is a complete and accurate
list of all Existing Debt (other than Surviving Debt), showing as of the
date hereof the principal amount outstanding thereunder.
(ee) Set forth on Schedule 4.01(ee) hereto is a complete and accurate
list of all Surviving Debt, showing as of the date hereof the principal
amount outstanding thereunder, the maturity date thereof and the
amortization schedule therefor.
(ff) Set forth on Schedule 4.01 (ff) hereto is a complete and accurate
list of all real property owned by any Loan Party or any of its
Subsidiaries or in which any Loan Party has an interest as a contract
vendee, showing as of the date hereof the street address, county or other
relevant jurisdiction, state, record owner and book and estimated fair
value thereof. Each Loan Party or such Subsidiary has good, marketable and
insurable fee simple title to such real property, free and clear of all
Liens, other than Liens created or permitted by the Loan Documents.
(gg) Set forth on Schedule 4.01(gg) hereto is a complete and accurate
list of all leases of real property under which any Loan Party or any of
its Subsidiaries is the lessee, showing as of the date hereof the street
address, county or other relevant jurisdiction, state, lessor, lessee,
expiration date and annual rental cost thereof. To the best knowledge of
each Loan Party, each such lease is the legal, valid and binding obligation
of the lessor thereof, enforceable in accordance with its terms.
(hh) Set forth on Schedule 4.01(hh) hereto is a complete and accurate
list of all Material Contracts of each Loan Party and its Subsidiaries,
showing as of the date hereof the parties, subject matter and term thereof.
Except as could not reasonably be expected to have a Material Adverse
Effect, each such Material Contract has been duly authorized, executed and
delivered by all parties thereto, has not been amended or otherwise
modified, is in full force and effect and is binding upon and enforceable
against all parties thereto in accordance with its terms. There exists no
default under any Material Contract by PSC or any of its Subsidiaries party
thereto and to the best knowledge of each Loan Party, there exists no
default under any Material Contract by any other party thereto.
(ii) Set forth on Schedule 4.01(ii) hereto is a complete and accurate
list of all Investments held by any Loan Party or any of its Subsidiaries,
showing as of the date hereof the amount, obligor or issuer and maturity,
if any, thereof.
(jj) Set forth on Schedule 4.01(jj) hereto is a complete and accurate
list of all patents, trademarks, trade names, service marks and copyrights,
and all applications therefor and licenses thereof, of each Loan Party or
any of its Subsidiaries, showing as of the date hereof the jurisdiction in
which registered, the registration number, the date of registration and the
expiration date.
ARTICLE V
COVENANTS OF PSC AND THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, each of PSC and the Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries
to comply, in all material respects, with all applicable laws, rules,
regulations and orders, such compliance to include, without limitation,
compliance with ERISA and Environmental Laws.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (ii) all lawful claims that, if unpaid, might by law
become a Lien upon its property; provided, however, that each of PSC, the
Borrower and their respective Subsidiaries shall not be required to pay or
discharge any such tax, assessment, charge or claim that is being contested in
good faith and by proper proceedings and as to which appropriate reserves are
being maintained, unless and until any Lien resulting therefrom attaches to its
property and becomes enforceable against its other creditors.
(c) Compliance with Environmental Laws. Comply, and cause each of its
Subsidiaries and all lessees and other Persons operating or occupying its
properties to comply, in all material respects, with all applicable
Environmental Laws and Environmental Permits; obtain and renew and cause each of
its Subsidiaries to obtain and renew all Environmental Permits reasonably
necessary for its operations and properties; and conduct, and cause each of its
Subsidiaries to conduct, any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove and
clean up all Hazardous Materials from any of its properties, in accordance with
the requirements of all Environmental Laws; provided, however, that each of PSC,
the Borrower and their respective Subsidiaries shall not be required to
undertake any such cleanup, removal, remedial or other action to the extent that
its obligation to do so is being contested in good faith and by proper
proceedings and appropriate reserves are being maintained with respect to such
circumstances.
(d) Maintenance of Insurance. Maintain, and cause each of its Subsidiaries
to maintain, insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which PSC, the Borrower or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and maintain, and
cause each of its Subsidiaries to preserve and maintain, its existence, legal
structure, legal name, rights (charter and statutory), permits, licenses,
approvals, privileges and franchises; provided, however, that the Borrower and
its Subsidiaries may consummate the Merger and any other merger or consolidation
permitted under Section 5.02(d) and provided further that none of PSC, the
Borrower or any of their respective Subsidiaries shall be required to preserve
any right, permit, license, approval, privilege or franchise if the Board of
Directors of PSC, the Borrower or such Subsidiary shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
PSC, the Borrower or such Subsidiary, as the case may be, and that the loss
thereof is not disadvantageous in any material respect to PSC, the Borrower,
such Subsidiary or the Lender Parties.
(f) Visitation Rights. (i) At any reasonable time and from time to time,
upon reasonable notice, permit the Administrative Agent or any of the Lender
Parties or any agents or representatives thereof, to examine and make copies of
and abstracts from the records and books of account of, and visit the properties
of, PSC, the Borrower and their respective Subsidiaries, and to discuss the
affairs, finances and accounts of PSC, the Borrower and any of their respective
Subsidiaries with any of their officers or directors.
(ii) In the case of PSC, meet at least one each calendar year with
representatives of the Administrative Agent and the Lender Parties to discuss
the affairs, finances and accounts of PSC, the Borrower and any of their
respective Subsidiaries.
(iii) Permit the Administrative Agent and the Lenders to conduct no more
than one commercial finance examination of PSC and its Subsidiaries during each
calendar year.
(g) Preparation of Environmental Reports. At the reasonable request of the
Administrative Agent made upon reasonable cause, from time to time, provide to
the Lender Parties within 60 days after such request, at the expense of the
Borrower, an environmental site assessment report for any of its or its
Subsidiaries properties described in such request, prepared by an environmental
consulting firm acceptable to the Required Lenders, indicating the presence or
absence of Hazardous Materials and the estimated cost of any compliance, removal
or remedial action in connection with any Hazardous Materials on such
properties; without limiting the generality of the foregoing, if the Required
Lenders determines at any time that a material risk exists that any such report
will not be provided within the time referred to above, the Required Lenders may
retain an environmental consulting firm to prepare such report at the expense of
the Borrower, and each of PSC and the Borrower hereby grants and agrees to cause
any of its Subsidiaries that owns any property described in such request to
grant at the time of such request, to the Administrative Agent, the Lender
Parties, such firm and any agents or representatives thereof an irrevocable
non-exclusive license, subject to the rights of tenants, to enter onto their
respective properties to undertake such an assessment.
(h) Keeping of Books. Keep, and cause each of its Subsidiaries to keep,
proper books of record and account, in which full and correct entries shall be
made of all financial transactions and the assets and business of PSC, the
Borrower and each such Subsidiary in accordance with generally accepted
accounting principles in effect from time to time.
(i) Maintenance of Properties, Etc. Maintain and preserve, and cause each
of its Subsidiaries to maintain and preserve, all of its properties that are
reasonably necessary in the conduct of its business in good working order and
condition, ordinary wear and tear excepted.
(j) Compliance with Terms of Leaseholds. Make all payments and otherwise
perform all obligations in respect of all leases of real property to which PSC,
the Borrower or any of their respective Subsidiaries is a party, keep such
leases in full force and effect and not allow such leases to lapse or be
terminated or any rights to renew such leases to be forfeited or cancelled,
notify the Administrative Agent of any default by any party with respect to such
leases and cooperate with the Administrative Agent in all respects to cure any
such default, and cause each of its Subsidiaries to do so except, in any case,
where the failure to do so, either individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(k) Performance of Related Documents. Perform and observe all of the terms
and provisions of each Related Document to be performed or observed by it,
maintain each such Related Document in full force and effect, enforce such
Related Document in accordance with its terms, take all such action to such end
as may be from time to time requested by the Administrative Agent and, upon
request of the Administrative Agent, make to each other party to each such
Related Document such demands and requests for information and reports or for
action as the Borrower is entitled to make under such Related Document.
(l) Performance of Material Contracts. Perform and observe all the terms
and provisions of each Material Contract to be performed or observed by it,
maintain each such Material Contract in full force and effect, and enforce each
such Material Contract in accordance with its terms.
(m) Transactions with Affiliates. Conduct, and cause each of its
Subsidiaries to conduct, all transactions otherwise permitted under the Loan
Documents with any of their Affiliates on terms that are fair and reasonable and
no less favorable to PSC, the Borrower or such Subsidiary than it would obtain
in a comparable arm's-length transaction with a Person not an Affiliate.
(n) Cash Concentration Accounts. In the case of PSC, maintain main cash
concentration accounts with one or more of the Lenders.
(o) Further Assurances. (i) Upon the request of the Administrative Agent
following the occurrence and during the continuance of a Default, and at the
expense of the Borrower, (A) within 10 days after such request, furnish to the
Administrative Agent a description of the real and personal properties of PSC,
the Borrower and their respective Subsidiaries in detail satisfactory to the
Administrative Agent, (B) within 15 days after such request, duly execute and
deliver to the Administrative Agent mortgages, pledges, assignments and other
security agreements, as specified by and in form and substance satisfactory to
the Administrative Agent, securing payment of all the Obligations of the Loan
Parties under the Loan Documents and constituting Liens on all such properties,
(C) within 30 days after such request, take whatever action (including, without
limitation, the recording of mortgages, the filing of Uniform Commercial Code
financing statements, the giving of notices and the endorsement of notices on
title documents) as may be necessary or reasonably advisable in the opinion of
the Administrative Agent to vest in the Administrative Agent (or in any
representative of the Administrative Agent designated by it) valid and
subsisting Liens on the properties purported to be subject to the security
agreements delivered pursuant to this Section 5.01(o), enforceable against all
third parties in accordance with their terms, (D) within 60 days after such
request, deliver to the Administrative Agent a signed copy of a favorable
opinion, addressed to the Administrative Agent, of counsel for the Loan Parties
reasonably acceptable to the Administrative Agent as to the matters contained in
clauses (A), (B) and (C) above, as to such security agreements being legal,
valid and binding obligations of the Loan Parties enforceable in accordance with
their terms and as to such other matters as the Administrative Agent may
reasonably request, (E) as promptly as practicable after such request, deliver
to the Administrative Agent surveys meeting the criteria specified in Section
3.01(l)(xi)(C) and Mortgage Policies as to each parcel of real property subject
to such request, and (F) at any time and from time to time, promptly execute and
deliver any and all further instruments and documents and take all such other
action as the Administrative Agent may deem desirable in obtaining the full
benefits of, or in preserving the Liens of, such security agreements.
(ii) Upon the reasonable request of the Administrative Agent and at the
expense of the Borrower, within 30 days after such request, furnish to the
Administrative Agent an appraisal of each of the properties described in the
Mortgages complying with the requirements of the Federal Financial Institutions,
Reform, Recovery and Enforcement Act of 1989, which appraisals shall be from a
person acceptable to the Lender Parties and otherwise inform and substance
satisfactory to the Lender parties.
(iii) Upon the reasonable (in light of the circumstances existing at such
time) request of the Administrative Agent, and at the expense of the Borrower,
within 30 days a such request, (x) duly execute and deliver to the
Administrative Agent pledges, assignments and other security agreements, as
specified by and in form and substance satisfactory to the Administrative Agent,
constituting Liens on the shares of capital stock of any Foreign Subsidiary
under the laws of the jurisdiction of such Foreign Subsidiary's incorporation,
(y) take whatever further action as may be necessary or reasonably advisable in
the opinion of the Administrative Agent to vest in the Administrative Agent (or
any representative of the Administrative Agent designated by it) valid and
subsisting Liens on such shares of capital stock and (z) deliver to the
Administrative Agent a signed copy of a favorable opinion, addressed to the
Administrative Agent, of counsel for the Loan Parties in such jurisdiction
reasonably acceptable to the Administrative Agent as to the matters contained in
clauses (x) and (y) above, as to such security agreements being legal, valid and
binding obligations of the Loan Parties enforceable in accordance with their
terms and as to such other matters as the Administrative Agent may reasonably
request.
(p) Interest Rate Hedging. In the case of the Borrower, enter into prior to
September 30, 1996, and maintain at all times thereafter, interest rate Hedge
Agreements with Persons acceptable to the Administrative Agent, covering (i)
prior to June 30, 1998 a notional amount of not less than 50% of the initial
Borrowings hereunder and (ii) subsequent to June 30, 1998 a notional amount of
not less than 25% of the Advances outstanding on June 30, 1998 under all of the
Facilities. For purposes of calculating the aggregate principal amount of
Advances outstanding on June 30, 1998, the Working Capital Advances shall be
deemed to be outstanding in an aggregate principal amount equal to the average
principal amount of Working Capital Advances outstanding during the two fiscal
quarters ended on June 30, 1998.
(q) Termination of Financing Statements. Upon the request of the
Administrative Agent, and at the expense of the Borrower, within 10 days after
such request, furnish to the Administrative Agent proper termination statements
on Form UCC-3 covering such financing statements as the Administrative Agent may
reasonably request that were listed in the completed requests for information
referred to in Section 3.01(l)(ix)(C).
(r) IRB Notices. In the case of PSC, cause the Company to deliver the IRB
Notices to the appropriate parties under the IRB Documents on the date of the
Initial Extension of Credit.
(s) IRB Mortgage. In the case of PSC, (i) use its best efforts to seek all
necessary consents from the Bond Trustee or any other Person, which consents are
necessary to permit the Administrative Agent to place a Lien on the Borrower's
interest as contract vendee under the IRB Documents and (ii) promptly upon
receipt of all such consents execute and deliver to the Administrative Agent a
mortgage, in form and substance satisfactory to the Administrative Agent,
together with fixture filings satisfying the requirements of Section
3.01(l)(xi)(f), granting to the Administrative Agent a first-priority security
interest in such contract vendee's interest subject only to the Permitted
Encumbrances described in the Oregon Deed of Trust.
(t) Foreign Subsidiaries. In the case of PSC, within 25 Business Days after
the date hereof, deliver evidence in form and substance satisfactory to the
Administrative Agent of the pledge to the Administrative Agent for its benefit
and the benefit of the Secured Parties, in accordance with the terms of the
Security Agreement, of the capital stock of PSC Asia Pacific Pty Limited, PSC
S.A.R.L., TxCom, PSC Srl, Photographic Sciences GmbH and Foreign Sales
Corporation.
SECTION 5.02. Negative Covenants. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, PSC and the Borrower will not, at any time, without
the consent of the Required Lenders:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any
Lien on or with respect to any of its properties of any character
(including, without limitation, accounts) whether now owned or hereafter
acquired, or sign or file or suffer to exist, or permit any of its
Subsidiaries to sign or file or suffer to exist, under the Uniform
Commercial Code of any jurisdiction, a financing statement that names PSC
or the Borrower or any of their respective Subsidiaries as debtor, or sign
or suffer to exist, or permit any of its Subsidiaries to sign or suffer to
exist, any security agreement authorizing any secured party thereunder to
file such financing statement, or assign, or permit any of its Subsidiaries
to assign, any accounts or other right to receive income, excluding,
however, from the operation of the foregoing restrictions the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on
Schedule 5.02(a)(iii) hereto;
(iv) purchase money Liens upon or in real property or
equipment acquired or held by PSC, the Borrower or
any of their respective Subsidiaries in the ordinary
course of business to secure the purchase price of such property or
equipment or to secure Debt incurred solely for the purpose of
financing the acquisition, construction or improvement of any such
property or equipment to be subject to such Liens, or Liens existing
on any such property or equipment at the time of acquisition (other
than any such Liens created in contemplation of such acquisition that
do not secure the purchase price), or extensions, renewals or
replacements of any of the foregoing for the same or a lesser amount;
provided, however, that no such Lien shall extend to or cover any
property other than the property or equipment being acquired,
constructed or improved, and no such extension, renewal or replacement
shall extend to or cover any property not theretofore subject to the
Lien being extended, renewed or replaced; and provided further that
the aggregate principal amount of the Debt secured by Liens permitted
by this clause (iv) shall not exceed the amount permitted under
Section 5.02(b)(iii)(B) at any time outstanding and that any such Debt
shall not otherwise be prohibited by the terms of the Loan Documents;
(v) Liens arising in connection with Capitalized Leases permitted
under Section 5.02(b)(iii)(C); provided that no such Lien shall extend
to or cover any Collateral or assets other than the assets subject to
such Capitalized Leases;
(vi) other Liens securing Debt outstanding in an aggregate
principal amount not to exceed $3,000,000, provided that no such Lien
shall extend to or cover any Collateral; and
(vii) the replacement, extension or renewal of any Lien permitted
by clauses (iii) through (vi) above upon or in the same property
theretofore subject thereto or the replacement, extension or renewal
(without increase in the amount or change in any direct or contingent
obligor) of the Debt secured thereby.
(b) Debt. Create, incur, assume or suffer to exist, or permit any of
its Subsidiaries to create, incur, assume or suffer to exist, any Debt
other than:
(i) in the case of the Borrower, Debt incurred pursuant to the
Hedge Agreements;
(ii) in the case of any of the Subsidiaries (other than the
Borrower and the Foreign Subsidiaries) of PSC, Debt owed to PSC or to
a wholly-owned Subsidiary of PSC (other than a Foreign Subsidiary),
provided that such Debt is evidenced by a promissory note and such
promissory note is pledged to the Secured Parties pursuant to the
terms of the Security Agreement; and
(iii) in the case of PSC, the Borrower and any of their
respective Subsidiaries,
(A) Debt under the Loan Documents,
(B) Debt secured by Liens permitted by Section 5.02(a)(iv)
not to exceed in the aggregate $3,000,000 at any time
outstanding,
(C) Capitalized Leases not to exceed in the aggregate
$3,000,000 at any time outstanding,
(D) the Surviving Debt, and any Debt extending the maturity
of, or refunding or refinancing, in whole or in part, any
Surviving Debt, provided that the terms of any such extending,
refunding or refinancing Debt, and of any agreement entered into
and of any instrument issued in connection therewith, are
otherwise permitted by the Loan Documents and provided further
that the principal amount of such Surviving Debt shall not be
increased above the principal amount thereof outstanding
immediately prior to such extension, refunding or refinancing,
and the direct and contingent obligors therefor shall not be
changed, as a result of or in connection with such extension,
refunding or refinancing,
(E) Debt in respect of the Subordinated Debt and the Seller
Note; and
(F) indorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of
business;
(iv) in the case of PSC, Debt owed to the Borrower, provided that
such Debt is evidenced by a promissory note and such promissory note
is pledged to the Secured Parties pursuant to the terms of the
Security Agreement; and
(v) in the case of PSC and the Borrower, unsecured Debt incurred
in the ordinary course of business for the deferred purchase price of
property or services, maturing within one year from the date created,
and aggregating, on a Consolidated basis, not more than $3,000,000 at
any one time outstanding.
(c) Lease Obligations. Create, incur, assume or suffer to exist, or
permit any of their respective Subsidiaries to create, incur, assume or
suffer to exist, any obligations as lessee (i) for the rental or hire of
real or personal property in connection with any sale and leaseback
transaction, or (ii) for the rental or hire of other real or personal
property of any kind under leases or agreements to lease including
Capitalized Leases having an original term of one year or more that would
cause the direct and contingent liabilities of PSC and its Subsidiaries, on
a Consolidated basis, in respect of all such obligations to exceed
$3,000,000 payable in any period of 12 consecutive months.
(d) Mergers, Etc. Merge into or consolidate with any Person or permit
any Person to merge into it, or permit any of their respective Subsidiaries
to do so, except that (i) the Borrower and its Subsidiaries may consummate
the Merger, (ii) any Subsidiary of PSC
(other than the Borrower) may merge into or consolidate with any other
Subsidiary of PSC (other than the Borrower or a Foreign Subsidiary) or PSC
provided that, in the case of any such merger or consolidation, the Person
formed by such merger or consolidation shall be either PSC or a
wholly-owned Subsidiary of PSC, (iii) any of the Borrower's Subsidiaries
may merge into PSC; (iv) any Foreign Subsidiary may merge into or
consolidate with any other Foreign Subsidiary, provided that, in the case
of such merger or consolidation, the Person formed by such merger or
consolidation shall be a wholly-owned Subsidiary of PSC; and (v) PSC may
merge into or consolidate with any other Person in a merger permitted by
Section 5.01(f)(i) or (vii), provided that, in the case of such merger or
consolidation, PSC or such Subsidiary shall be the surviving corporation;
provided, however, that in each case, immediately after giving effect
thereto, no event shall occur and be continuing that constitutes a Default
and, in the case of any merger or consolidation to which the Borrower or
PSC is a party, the Borrower or PSC, as the case may be, is the surviving
corporation.
(e) Sales, Etc. of Assets. Sell, lease, transfer or otherwise dispose
of, or permit any of their respective Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets or grant any option or other right to
purchase, lease or otherwise acquire any assets, except:
(i) sales of Inventory in the ordinary course of its business,
(ii) in a transaction authorized by subsection (d) of this
Section,
(iii) sales of assets for cash and for fair value in an aggregate
amount not to exceed $1,000,000 in any Fiscal Year,
(iv) the sale of any asset by PSC or any of its Subsidiaries
(other than a bulk sale of inventory and a sale of Receivables other
than delinquent accounts for collection purposes only) so long as (A)
the purchase price paid to PSC, or such Subsidiary for such asset
shall be no less than the fair market value of such asset at the time
of such sale, (B) the purchase price for such asset shall be paid to
PSC or such Subsidiary solely in cash and (C) the aggregate purchase
price paid to PSC and all of its Subsidiaries for such asset and all
other assets sold by PSC and its Subsidiaries during the same Fiscal
Year pursuant to this clause (iv) shall not exceed $1,000,000, and
(v) so long as no Default shall occur and be continuing, the
grant of any option or other right to purchase any asset in a
transaction which would be permitted under the provisions of
clause (iv) above,
provided that in the case of sales of assets pursuant to clause (iv) above,
PSC and the Borrower shall, on the date of receipt by PSC, the Borrower or
any of their respective Subsidiaries of the Net Cash Proceeds from such
sale, prepay the Advances pursuant to, and in the amount and order of
priority set forth in, Section 2.06(b)(ii), as specified therein.
(f) Investments in Other Persons. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment in any Person other than:
(i) Investments by PSC and its Subsidiaries in their Subsidiaries
outstanding on the date hereof and additional investments in wholly-owned
Subsidiaries in an aggregate amount invested from the date hereof not to
exceed $5,000,000; provided, however, that no more than an aggregate amount
equal to $3,000,000 can be invested from the date hereof in Foreign
Subsidiaries; provided, further, that with respect to Investments in any
newly acquired or created wholly-owned Subsidiary, such Subsidiary shall
become a Subsidiary Guarantor pursuant to the terms of the Subsidiary
Guaranty and an additional grantor pursuant to the terms of the Security
Agreement and Intellectual Property Security Agreement;
(ii) (A) loans to employees of PSC and its Subsidiaries in connection
with purchases of stock of PSC pursuant to the PSC Stock Option Plan in an
aggregate principal amount not to exceed $1,000,000 at any time outstanding
and (B) loans and advances to employees in the ordinary course of the
business of PSC, the Borrower and their respective Subsidiaries as
presently conducted in an aggregate principal amount not to exceed $500,000
at any time outstanding;
(iii) Investments by PSC, the Borrower and their respective
Subsidiaries in Cash Equivalents;
(iv) Investments by the PSC, the Borrower and their respective
Subsidiaries Hedge Agreements permitted under Section 5.01(p);
(v) Investments consisting of intercompany Debt permitted under
Section 5.02(b)(ii);
(vi) Investments (A) existing on the date hereof and described on
Schedule 4.01(ii) hereto or (B) otherwise disclosed on such Schedule; and
(vii) other Investments in an aggregate amount invested not to exceed
$3,000,000 in Persons other than wholly-owned Subsidiaries; provided that,
(1) any such Investments in any newly acquired or created Subsidiary of
PSC, the Borrower or any of their respective Subsidiaries shall become a
Subsidiary Guarantor pursuant to the terms of the Subsidiary Guaranty and a
collateral grantor pursuant to the terms of the Security Agreement and
Intellectual Property Security Agreement, (2) immediately before and after
giving effect thereto, no Default shall have occurred and be continuing or
would result therefrom; and (3) any business acquired or invested in
pursuant to this clause (vii) shall be in the same line of business as the
business of PSC, the Borrower or any of their respective Subsidiaries.
(g) Dividends, Etc. Declare or pay any dividends, purchase, redeem,
retire, defease or otherwise acquire for value any of its capital stock or
any warrants, rights or options to acquire such capital stock, now or
hereafter outstanding, return any capital to its stockholders as such, make
any distribution of assets, capital stock, warrants, rights, options,
obligations or securities to its stockholders as such or issue or sell any
capital stock or any warrants, rights or options to acquire such capital
stock, or permit any of its Subsidiaries to do any of the foregoing or
permit any of its Subsidiaries to purchase, redeem, retire, defease or
otherwise acquire for value any capital stock of the Borrower or any
warrants, rights or options to acquire such capital stock or to issue or
sell any capital stock or any warrants, rights or options to acquire such
capital stock, except that, (i) PSC may declare and pay dividends and
distributions payable only in common stock of PSC, (ii) a Foreign
Subsidiary may declare and pay dividends and distributions to PSC, provided
that the Secured Parties shall have a perfected first priority security
interest in the property comprising such dividends or distribution and
(iii) PSC may acquire shares of its common stock for an aggregate purchase
price during the period from the date hereof through the Termination Date
not to exceed $3,000,000, provided that, at the time of such acquisition
and immediately after giving effect thereto, (x) the excess of Consolidated
total assets over Consolidated total liabilities shall not be less than
$44,000,000 and (y) no Default shall have occurred and be continuing.
(h) Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business as
carried on at the date hereof.
(i) Charter Amendments. Amend, or permit any of its Subsidiaries to
amend, its certificate of incorporation or bylaws, other than any amendment
that could not reasonably be expected to have a Material Adverse Effect.
(j) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) accounting policies or
reporting practices, except as required or permitted by generally accepted
accounting principles or (ii) the Fiscal Year.
(k) Prepayments, Etc. of Debt. Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner, or
make any payment in violation of any subordination terms of, any Debt,
other than (i) the prepayment of the Advances in accordance with the terms
of this Agreement and (ii) regularly scheduled or required repayments or
redemptions of Surviving Debt, or amend, modify or change in any manner any
term or condition of any Surviving Debt, the Subordinated Debt or the
Seller Note, or permit any of its Subsidiaries to do any of the foregoing
other than to prepay any Debt payable to the Borrower.
(l) Amendment, Etc. of Related Documents. Cancel or terminate any
Related Document or consent to or accept any cancellation or termination
thereof, amend, modify or change in any manner any term or condition of any
Related Document or give any consent, waiver or approval thereunder, waive
any default under or any breach of any term or condition of any Related
Document, agree in any manner to any other amendment, modification or
change of any term or condition of any Related Document or take any other
action in connection with any Related Document that would materially impair
the value of the interest or rights of PSC or the Borrower thereunder or
that would materially impair the rights or interests of the Administrative
Agent or any Lender Party, or permit any of its Subsidiaries to do any of
the foregoing.
(m) Amendment, Etc. of Material Contracts. Cancel or terminate any
Material Contract or consent to or accept any cancellation or termination
thereof, amend or otherwise modify any Material Contract or give any
consent, waiver or approval thereunder, waive any default under or breach
of any Material Contract, agree in any manner to any other amendment,
modification or change of any term or condition of any Material Contract or
take any other action in connection with any Material Contract that would
materially impair the value of the interest or rights of the Borrower
thereunder or that would materially impair the interest or rights of the
Administrative Agent or any Lender Party, or permit any of its Subsidiaries
to do any of the foregoing.
(n) Negative Pledge. Enter into or suffer to exist, or permit any of
its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon any
of its property or assets other than (i) in favor of the Secured Parties or
(ii) in connection with (A) any Surviving Debt and any Debt outstanding on
the date such Subsidiary first becomes a Subsidiary or (B) any Debt
permitted by Section 5.02(b)(iii)(F) hereof.
(o) Partnerships, New Subsidiaries. (i) Become a general partner in
any general or limited partnership or joint venture, or permit any of its
Subsidiaries to do so, other than any Subsidiary the sole assets of which
consist of its interest in such partnership or joint venture or (ii) create
any new Subsidiaries unless such newly created Subsidiary shall become a
Subsidiary Guarantor pursuant to the terms of the Subsidiary Guaranty and
an additional grantor pursuant to the terms of the Security Agreement and
the Intellectual Property Security Agreement.
(p) Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options or
futures contracts or any similar speculative transactions except for Hedge
Agreements permitted under Section 5.02(p).
(q) Capital Expenditures. Make, or permit any of its Subsidiaries to
make, any Capital Expenditures that would cause the aggregate of all such
Capital Expenditures made by PSC, the Borrower and its Subsidiaries in any
period set forth below to exceed the amount set forth below for such period
Period Amount
Effective Date through 12/31/9 .......................... $ 7,000,000
Fiscal Year Ending 12/31/97 ............................. $12,000,000
Fiscal Year Ending 12/31/98 ............................. $15,000,000
Fiscal Year Ending 12/31/99 ............................. $18,000,000
Fiscal Year Ending 12/31/2000 ........................... $19,000,000
Fiscal Year Ending 12/31/2001 ........................... $15,000,000
1/1/2002 through 6/30/2002 .............................. $ 7,500,000
SECTION 5.03. Reporting Requirements. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, PSC and the Borrower will furnish to the Lender
Parties:
(a) Default Notice. As soon as possible and in any event within two
Business Days after obtaining knowledge of the occurrence of each Default
or any event, development or occurrence reasonably likely to have a
Material Adverse Effect continuing on the date of such statement, a
statement of the chief financial officer of PSC setting forth details of
such Default and the action that PSC has taken and proposes to take with
respect thereto.
(b) Monthly Financials. As soon as available and in any event within
45 days after the end of each month, a Consolidated balance sheet of PSC
and its Subsidiaries as of the end of such month and Consolidated statement
of income and a Consolidated statement of cash flows of PSC and its
Subsidiaries for the period commencing at the end of the previous month and
ending with the end of such month and Consolidated statement of income and
a Consolidated statement of cash flows of PSC and its Subsidiaries for the
period commencing at the end of the previous Fiscal Year and ending with
the end of such month, duly certified by the chief financial officer of
PSC.
(c) Quarterly Financials. As soon as available and in any event within
45 days after the end of each of the first three quarters of each Fiscal
Year, Consolidated balance sheet of PSC and its Subsidiaries as of the end
of such quarter and Consolidated statement of income and a Consolidated
statement of cash flows of PSC and its Subsidiaries for the period
commencing at the end of the previous fiscal quarter and ending with the
end of such fiscal quarter and Consolidated statement of income and a
Consolidated statement of cash flows of PSC and its Subsidiaries for the
period commencing at the end of the previous Fiscal Year and ending with
the end of such quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding period of the preceding Fiscal
Year and the corresponding figures from the budgets for such period and for
the Fiscal Year which includes such period, all in reasonable detail and
duly certified (subject to year-end audit adjustments) by the chief
financial officer of PSC as having been prepared in accordance with GAAP,
together with (i) a certificate of said officer stating that no Default has
occurred and is continuing or, if a Default has occurred and is continuing,
a statement as to the nature thereof and the action that PSC has taken and
proposes to take with respect thereto and (ii) a schedule in form
satisfactory to the Administrative Agent of the computations used by PSC in
determining compliance with the covenants contained in Sections 5.04(a)
through (d), provided that in the event of any change in GAAP used in the
preparation of such financial statements, PSC shall also provide, if
necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to GAAP.
(d) Annual Financials. As soon as available and in any event within 90
days after the end of each Fiscal Year, a copy of the annual audit report
for such year for PSC and its Subsidiaries, including therein Consolidated
and consolidating balance sheets of PSC and its Subsidiaries as of the end
of such Fiscal Year and Consolidated and consolidating statements of income
and a Consolidated statement of cash flows of PSC and its Subsidiaries for
such Fiscal Year, in each case setting forth in comparative form the
corresponding figures for the prior Fiscal Year and the corresponding
figures from the budget for such Fiscal Year and in each case accompanied
(in the case of such Consolidated financial statements) by an opinion
acceptable to the Required Lenders of Arthur Anderson LLP or other
independent public accountants of recognized standing acceptable to the
Required Lenders, together with (i) a letter of such accounting firm to the
Lender Parties stating that in the course of the regular audit of the
business of PSC and its Subsidiaries, which audit was conducted by such
accounting firm in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge that a Default has occurred
and is continuing, or if, in the opinion of such accounting firm, a Default
has occurred and is continuing, a statement as to the nature thereof, (ii)
a schedule in form satisfactory to the Administrative Agent of the
computations used by such accountants in determining, as of the end of such
Fiscal Year, compliance with the covenants contained in Sections 5.04(a)
through (d), provided that in the event of any change in GAAP used in the
preparation of such financial statements, PSC shall also provide, if
necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to GAAP
and (iii) a certificate of the chief financial officer of PSC stating that
no Default has occurred and is continuing or, if a default has occurred and
is continuing, a statement as to the nature thereof and the action that PSC
has taken and proposes to take with respect thereto.
(e) Annual Forecasts. As soon as available and in any event no later
than 30 days after the end of each Fiscal Year, forecasts prepared by
management of PSC, in form reasonably satisfactory to the Administrative
Agent, of balance sheets, income statements and cash flow statements on a
quarterly basis for the Fiscal Year following such Fiscal Year then ended.
(f) ERISA Events and ERISA Reports. Promptly and in any event within
10 days after any Loan Party or any ERISA Affiliate knows or has reason to
know that any ERISA Event has occurred, a statement of the chief financial
officer of PSC describing such ERISA Event and the action, if any, that
such Loan Party or such ERISA Affiliate has taken and proposes to take with
respect thereto and (ii) on the date any records, documents or other
information must be furnished to the PBGC with respect to any Plan pursuant
to Section 4010 of ERISA, a copy of such records, documents and
information.
(g) Plan Terminations. Promptly and in any event within five Business
Days after receipt thereof by any Loan Party or any ERISA Affiliate, copies
of each notice from the PBGC stating its intention to terminate any Plan or
to have a trustee appointed to administer any Plan.
(h) Actuarial Reports. Promptly upon receipt thereof by any Loan Party
or any ERISA Affiliate, a copy of the annual actuarial valuation report for
each Plan the funded current liability percentage (as defined in Section
302(d)(8) of ERISA) of which is less than 90% or the unfunded current
liability of which exceeds $250,000.
(i) Plan Annual Reports. Promptly and in any event within 30 days
after the filing thereof with the Internal Revenue Service, copies of each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series)
with respect to each Plan.
(j) Multiemployer Plan Notices. Promptly and in any event within five
Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate from the sponsor of a Multiemployer Plan, copies of each notice
concerning (i) the imposition of Withdrawal Liability by any such
Multiemployer Plan, (ii) the reorganization or termination, within the
meaning of Title IV of ERISA, of any such Multiemployer Plan or (iii) the
amount of liability incurred, or that may be incurred, by such Loan Party
or any ERISA Affiliate in connection with any event described in clause (i)
or (ii).
(k) Litigation. Promptly after the commencement thereof, notice of all
actions, suits, investigations, litigation and proceedings before any court
or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, affecting any Loan Party or any of
its Subsidiaries of the type described in Section 4.01(j), and promptly
after the occurrence thereof, notice of any material adverse change in the
status or the financial effect on any Loan Party or any of its Subsidiaries
of the Disclosed Litigation from that described on Schedule 3.01(g).
(l) Securities Reports. Promptly after the sending or filing thereof,
copies of all proxy statements, financial statements and reports that any
Loan Party or any of its Subsidiaries sends to its stockholders, and copies
of all regular, periodic and special reports, and all registration
statements, that any Loan Party or any of its Subsidiaries files with the
Securities and Exchange Commission or any governmental authority that may
be substituted therefor, or with any national securities exchange.
(m) Creditor Reports. Promptly after the furnishing thereof, copies of
any statement or report furnished to any other holder of the securities of
any Loan Party or of any of its Subsidiaries pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required
to be furnished to the Lender Parties pursuant to any other clause of this
Section 5.03.
(n) Agreement Notices. Promptly upon receipt thereof, copies of all
notices, requests and other documents received by any Loan Party or any of
its Subsidiaries under or pursuant to any Related Document or Material
Contract or indenture, loan or credit or similar agreement regarding or
related to any breach or default by any party thereto or any other event
that could materially impair the value of the interests or the rights of
any Loan Party or otherwise have a Material Adverse Effect and copies of
any amendment, modification or waiver of any provision of any Related
Agreement or Material Contract or indenture, loan or credit or similar
agreement and, from time to time upon request by the Administrative Agent,
such information and reports regarding the Related Documents and the
Material Contracts as the Administrative Agent may reasonably request.
(o) Revenue Administrative Agent Reports. Within 10 days after
receipt, copies of all Revenue Administrative Agent Reports (Internal
Revenue Service Form 886), or other written proposals of the Internal
Revenue Service, that propose, determine or otherwise set forth positive
adjustments to the Federal income tax liability of the affiliated group
(within the meaning of Section 1504(a)(1) of the Internal Revenue Code) of
which PSC is a member aggregating $1,000,000 or more.
(p) Tax Certificates. Promptly, and in any event within five Business
Days after the due date (with extensions) for filing the final Federal
income tax return in respect of each taxable year, a certificate (a "Tax
Certificate"), signed by the President or the chief financial officer of
PSC, stating that the common parent of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which PSC is
a member has paid to the Internal Revenue Service or other taxing
authority, or to PSC, the full amount that such affiliated group is
required to pay in respect of Federal income tax for such year and that PSC
and its Subsidiaries have received any amounts payable to them, and have
not paid amounts in respect of taxes (Federal, state, local or foreign) in
excess of the amount they are required to pay, under the Tax Agreements in
respect of such taxable year.
(q) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of any
noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that (i) could reasonably be
expected to have a Material Adverse Effect or (ii) cause any property
described in the Mortgages to be subject to any restrictions on ownership,
occupancy, use or transferability under any Environmental Law.
(r) Real Property. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report supplementing
Schedules 4.01(ff) and 4.01(gg) hereto, including an identification of all
real and leased property disposed of by PSC or any of its Subsidiaries
during such Fiscal Year, a list and description (including the street
address, county or other relevant jurisdiction, state, record owner, book
value thereof, and in the case of leases of property, lessor, lessee,
expiration date and annual rental cost thereof) of all real property
acquired or leased during such Fiscal Year and a description of such other
changes in the information included in such Schedules as may be necessary
for such Schedules to be accurate and complete.
(s) Insurance. As soon as available and in any event within 30 days
after the end of each Fiscal Year, a report summarizing the insurance
coverage (specifying type, amount and carrier) in effect for the each Loan
Party and its Subsidiaries and containing such additional information as
any Lender Party (through the Administrative Agent) may reasonably specify.
(t) Borrowing Base Certificate. As soon as available and in any event
within 10 Business Days after the end of each month, a Borrowing Base
Certificate, as at the end of the previous month, certified by the chief
financial officer of the Borrower.
(u) Management Letters. As soon as available and in any event within
10 Business Days after the receipt thereof, copies of any "management
letter" or similar letter received by the Borrower, PSC or the board of
directors (or committee thereof) of either such Person from its independent
public accountants.
(v) Other Information. Such other information respecting the business,
condition (financial or otherwise), operations, performance, properties or
prospects of any Loan Party or any of its Subsidiaries as any Lender Party
(through the Administrative Agent) may from time to time reasonably
request.
SECTION 5.04. Financial Covenants. So long as any Advance shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, PSC will:
(a) Fixed Charge Coverage Ratio. Maintain at the end of each fiscal quarter
of PSC a ratio of (i) Consolidated EBITDA for the most recently completed four
fiscal quarters of PSC (provided however that if such four fiscal quarter period
includes any or all of the fiscal quarters ending on September 30, 1995,
December 31, 1995, March 31, 1996 or June 30, 1996, Consolidated EBITDA shall be
calculated by using the Pro Forma EBITDA for each such fiscal quarter in such
four fiscal quarter period) less Capital Expenditures made during such period,
less the aggregate amount of federal, state, local and foreign taxes paid by PSC
and its Subsidiaries during such period to the (ii) sum of (w) cash interest
payable by PSC and its Subsidiaries on all Debt during such period plus (x) cash
rentals payable under Capitalized Leased during such period plus (y) principal
amounts of all Funded Debt payable, in each case, by PSC and its Subsidiaries
during such period plus (z) the aggregate purchase price paid by PSC and its
Subsidiaries during such period to purchase capital stock of PSC as permitted by
Section 5.02(g), of not less than the ratio set forth below for such period
(provided, however, that if such four fiscal quarter period includes any or all
of the fiscal quarters ending on September 30, 1995, December 31, 1995,
March 31, 1996 or June 30, 1996, (i) Capital Expenditures for such four fiscal
quarter period shall be the lesser of (A) the product of actual Capital
Expenditures made during such period multiplied by a fraction the numerator of
which is four and the denominator of which is the number of fiscal quarters that
have elapsed since the Closing Date and (B) $12,000,000, (ii) interest expense
for such four fiscal quarter period shall be the product of the actual amount of
interest expense payable during such period since the Closing Date multiplied by
a fraction the numerator of which is four and the denominator of which is
the number of fiscal quarters that have elapsed since the Closing Date and
(iii) aggregate taxes paid during such four fiscal quarter period shall be
the product of the actual taxes paid during such period since the Closing
Date multiplied by a fraction the numerator of which is four and the
denominator of which is the number of fiscal quarters which have elapsed
since the Closing):
Four Fiscal Quarters Ending In Ratio
12/31/96 ................ 1.15x
3/31/97 ................ 1.15x
6/30/97 ................ 1.15x
9/30/97 ................ 1.15x
12/31/97 ................ 1.15x
3/31/98 ................ 1.15x
6/30/98 ................ 1.15x
9/30/98 ................ 1.15x
12/31/98 ................ 1.15x
3/31/99 and each period thereafter . 1.25x
(b) Total Debt to EBITDA Ratio. Maintain at the end of each fiscal
quarter of PSC a Total Debt Ratio for such date of not more than the amount
set forth below for such period;
Four Fiscal Quarters Ending In Ratio
Effective date to 12/31/96 ...... 5.0x
3/31/97 ............... 4.75x
6/30/97 ............... 4.75x
9/30/97 ............... 4.25x
12/31/97 ............... 4.25x
3/31/98 ............... 3.75x
6/30/98 ............... 3.75x
9/30/98 ............... 3.75x
12/31/98 ............... 3.75x
3/31/98 and thereafter ........ 3.25x
(c) Senior Debt to EBITDA Ratio. Maintain at the end of each fiscal
quarter of PSC a ratio of Senior Debt of PSC and its Subsidiaries
outstanding on the last day of such fiscal quarter to Consolidated EBITDA
for the most recently completed four fiscal quarters of PSC (provided,
however, that (i) if such four fiscal quarter period includes any or all of
the fiscal quarters ending on September 30, 1995, December 31, 1995, March
31, 1996 or June 30, 1996, Consolidated EBITDA shall be calculated by using
the Pro Forma EBITDA for each such fiscal quarter in such four fiscal
quarter period, and (ii) for purposes of calculating the aggregate
principal amount of Senior Debt outstanding on the last day of any fiscal
quarter, the aggregate principal amount of Working Capital Advances shall
be deemed to be outstanding in a aggregate principal amount equal to the
average principal amount of Working Capital Advances outstanding during the
two fiscal quarters ended on such last day) of not more than the ratio set
forth below for such period:
Four Fiscal Quarters Ending In Ratio
Effective Date to 12/31/96 ...... 3.75x
3/31/97 ............... 3.50x
6/30/97 ............... 3.50x
9/30/97 ............... 3.0x
12/31/97 ............... 3.0x
3/31/98 ............... 2.50x
6/30/98 ............... 2.50x
9/30/98 ............... 2.50x
12/31/98 ............... 2.25x
3/31/99 and thereafter ........ 2.0x
(d) Interest Coverage Ratio. Maintain as of the end of each fiscal
quarter of PSC a ratio of (i) Consolidated EBITDA for the most recently
completed four fiscal quarters of PSC (provided, however, that if such four
fiscal quarter period includes any or all of the
fiscal quarters ending on September 30, 1995, December 31, 1995, March 31,
1996 or June 30, 1996, Consolidated EBITDA shall be calculated by using the
Pro Forma EBITDA for each such fiscal quarter in such four fiscal quarter
period) to (ii) Interest Expense of PSC and its Subsidiaries for such
period of not less than the ratio set forth below for such period
(provided, however, that if such four fiscal quarter period includes any or
all of the fiscal quarters ending on September 30, 1995, December 31, 1995,
March 31, 1996 or June 30, 1996, Interest Expense for such four fiscal
quarter period shall be actual Interest Expense during such period since
the Closing Date multiplied by a fraction the numerator of which is four
and the denominator of which is the number of fiscal quarters that have
elapsed since the Closing Date):
Four Fiscal Quarters Ending In Ratio
Effective Date to 12/31/96 ........ 2.0x
3/31/97 ................. 2.50x
6/30/97 ................. 2.50x
9/30/97 ................. 2.50x
12/31/97 ................. 2.50x
3/31/98 ................. 3.0x
6/30/98 ................. 3.0x
9/30/98 ................. 3.0x
12/30/98 ................. 3.0x
3/31/99 and thereafter .......... 3.50x
(e) Net Worth. Maintain at all times an excess of Consolidated total assets
over Consolidated total liabilities, in each case, of the Borrower and its
Subsidiaries of not less than (i) $34,000,000 plus (ii) 75% of Consolidated net
income of PSC and its Subsidiaries for during the period after June 30, 1996 to
and including each date of determination computed on a cumulative basis for
said entire period.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events ("Events of
Default") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any Advance when
the same shall become due and payable or (ii) the Borrower shall fail to pay any
interest on any
Advance, or any Loan Party shall fail to make any other payment under any
Loan Document, in each case under this clause (ii) within two Business Days
after the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or any of
its officers) under or in connection with any Loan Document shall prove to
have been incorrect in any material respect when made or confirmed; or
(c) the Borrower shall fail to perform or observe any term, covenant
or agreement contained in Section 2.14, 5.01(e), (f), (g), (m), (o) or (p),
5.02, 5.03 or 5.04; or
(d) any Loan Party shall fail to perform any other term, covenant or
agreement contained in any Loan Document on its part to be performed or
observed if such failure shall remain unremedied for 10 days after the
earlier of the date on which (A) a Responsible Officer of any Loan Party
becomes aware of such failure or (B) written notice thereof shall have been
given to the Borrower by the Administrative Agent or any Lender Party; or
(e) any Loan Party or any of its Subsidiaries shall fail to pay any
principal of, premium or interest on or any other amount payable in respect
of any Debt that is outstanding in a principal or notional amount of at
least $1,000,000 either individually or in the aggregate (but excluding
Debt outstanding hereunder) of such Loan Party or such Subsidiary (as the
case may be), when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise); or any
other event shall occur or condition shall exist under any agreement or
instrument relating to any such Debt, in each case if the effect of such
event or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the holder
thereof to cause, such Debt to mature; or any such Debt shall be declared
to be due and payable or required to be prepaid or redeemed (other than by
a regularly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturity
thereof; or
(f) any Loan Party or any of its Subsidiaries shall generally not pay
its debts as such debts become due, or shall admit in writing its inability
to pay its debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or against
any Loan Party or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it or for
any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is being
diligently contested by it in good faith, either such proceeding shall
remain undismissed or unstayed for a period of 30 days or any of the
actions sought in such proceeding (including, without limitation, the entry
of an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or any substantial part of its
property) shall occur; or any Loan Party or any of its Subsidiaries
shall take any corporate action to authorize any of the actions set forth
above in this subsection (f); or
(g) any judgment or order for the payment of money in excess of
$1,000,000 shall be rendered against any Loan Party or any of its
Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall
be any period of 10 consecutive days during which a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect; or
(h) any non-monetary judgment or order shall be rendered against any
Loan Party or any of its Subsidiaries that is reasonably likely to have a
Material Adverse Effect, and there shall be any period of 10 consecutive
days during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect; or
(i) any provision of any Loan Document after delivery thereof pursuant
to Section 3.01 or 5.01(o) shall for any reason cease to be valid and
binding on or enforceable against any Loan Party to it, or any such Loan
Party shall so state in writing; or
(j) any Collateral Document after delivery thereof pursuant to Section
3.01 or 5.01(o) shall for any reason (other than pursuant to the terms
thereof) cease to create a valid and perfected first priority lien on and
security interest in the Collateral purported to be covered thereby; or
(k) (i) any Person or two or more Persons acting in concert shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of
1934), directly or indirectly, of Voting Stock of PSC (or other securities
convertible into such Voting Stock) representing 30% or more of the
combined voting power of all Voting Stock of PSC; (ii) during any period of
up to 24 consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month period were
directors of PSC (together with any other director whose election to the
Board of Directors of PSC (or whose nomination by the Board of Directors
for election by the stockholders of PSC) was approved by a vote of at least
a majority of the directors then in office who either were directors at the
beginning of such period or whose election was previously so approved)
shall cease for any reason to constitute a majority of the board of
directors of PSC; or (iii) any Person or two or more Persons acting in
concert shall have acquired by contract or otherwise, or shall have entered
into a contract or arrangement that, upon consummation, will result in its
or their acquisition of the power to exercise, directly or indirectly, a
controlling influence over the management or policies of PSC; or
(l) any ERISA Event shall have occurred with respect to a Plan and the
sum (determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other Plans
with respect to which an ERISA Event shall have occurred and then exist (or
the liability of the Loan Parties and the ERISA Affiliates related to such
ERISA Event) exceeds $1,000,000; or
(m) any Loan Party or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount that, when aggregated
with all other amounts required to be paid to Multiemployer Plans by the
Loan Parties and the ERISA Affiliates as Withdrawal Liability (determined
as of the date of such notification), exceeds $1,000,000 or requires
payments exceeding $250,000 per annum; or
(n) any Loan Party or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of
ERISA, and as a result of such reorganization or termination the aggregate
annual contributions of the Loan Parties and the ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated
have been or will be increased over the amounts contributed to such
Multiemployer Plans for the plan years of such Multiemployer Plans
immediately preceding the plan year in which such reorganization or
termination occurs by an amount exceeding $1,000,000; or
(o) there shall occur in the reasonable judgment of the Required
Lenders any Material Adverse Change; or
(p) any Borrowing Base Deficiency shall occur; or
(q) on or before December 30, 1996 (i) the Borrower shall not have
good, marketable and insurable fee simple title to the IRB Property, free
and clear of all Liens, other than the Permitted Encumbrances (which shall
not include any Liens arising under the IRB Documents) as set forth in the
Oregon Deed of Trust or (ii) the Administrative Agent shall not have
received a Mortgage Policy on the IRB Property that complies in all
respects with the provisions of Section 3.01 (l)(xi)(B), provided that such
Mortgage Policy shall insure that the Lien created by the Oregon Deed of
Trust is subject only to Permitted Encumbrances (which shall not include
any Liens arising under the IRB Documents);
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each Appropriate Lender (other than the Commitment in
respect of Letter of Credit Advances by the Issuing Bank or a Working Capital
Lender pursuant to Section 2.03(c)) and Swing Line Advances by a Working Capital
Lender pursuant to Section 2.02(b) and of the Issuing Bank to issue Letters of
Credit to be terminated, whereupon the same shall forthwith terminate, and (ii)
shall at the request, or may with the consent, of the Required Lenders, (A) by
notice to the Borrower, declare the Notes, all interest thereon and all other
amounts payable under this Agreement and the other Loan Documents to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower and (B) by notice to each party required under the terms
of any agreement in support of which a Standby Letter of Credit is issued,
request that all Obligations under such agreement be declared to be due and
payable; provided, however, that in the event of an actual or deemed entry of an
order for relief with respect to any Loan Party or any of its Subsidiaries under
the Federal Bankruptcy Code, (x) the obligation of each Lender to make Advances
(other than Letter of Credit Advances by the Issuing Bank or a Working Capital
Lender pursuant to Section 2.03(c) and Swing Line Advances by a Working Capital
Lender pursuant to Section 2.02(b) and of the Issuing Bank to issue Letters of
Credit shall automatically be terminated and (y) the Notes, all such interest
and all such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.
SECTION 6.02. Actions in Respect of the Letters of Credit upon Default. If
any Event of Default shall have occurred and be continuing, the Administrative
Agent may, or shall at the request of the Required Lenders, irrespective of
whether it is taking any of the actions described in Section 6.01 or otherwise,
make demand upon the Borrower to, and forthwith upon such demand the Borrower
will, pay to the Administrative Agent on behalf of the Lender Parties in same
day funds at the Administrative Agent's office designated in such demand, for
deposit in the L/C Cash Collateral Account, an amount equal to the aggregate
Available Amount of all Letters of Credit then outstanding. If at any time the
Administrative Agent determines that any funds held in the L/C Cash Collateral
Account are subject to any right or claim of any Person other than the
Administrative Agent and the Lender Parties or that the total amount of such
funds is less than the aggregate Available Amount of all Letters of Credit, the
Borrower will, forthwith upon demand by the Administrative Agent, pay to the
Administrative Agent, as additional funds to be deposited and held in the L/C
Cash Collateral Account, an amount equal to the excess of (a) such aggregate
Available Amount over (b) the total amount of funds, if any, then held in the
L/C Cash Collateral Account that the Administrative Agent determines to be free
and clear of any such right and claim.
ARTICLE VII
The Administrative Agent
SECTION 7.01. Authorization and Action. Each Lender Party (in its
capacities as a Lender, the Swing Line Bank (if applicable) the Issuing Bank (if
applicable) and a potential Hedge Bank) hereby appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement and the other Loan Documents as
are delegated to the Administrative Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto.
As to any matters not expressly provided for by the Loan Documents (including,
without limitation, enforcement or collection of the Notes), the Administrative
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding upon all Lender Parties and all
holders of Notes; provided, however, that the Administrative Agent shall not be
required to take any action that exposes the Administrative Agent to personal
liability or that is contrary to this Agreement or applicable law. The
Administrative Agent agrees to give to each Lender Party prompt notice of each
notice given to it by the Borrower pursuant to the terms of this Agreement.
SECTION 7.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with the Loan Documents, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, the Administrative Agent: (a) may treat the payee of any Note as the
holder thereof until the Administrative Agent receives and accepts an Assignment
and Acceptance entered into by the Lender that is the payee of such Note, as
assignor, and an Eligible Assignee, as assignee, as provided in Section 8.07;
(b) may consult with legal counsel (including counsel for any Loan Party),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender Party and shall not be responsible to
any Lender Party for any statements, warranties or representations (whether
written or oral) made in or in connection with the Loan Documents; (d) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Loan Document on the part of
any Loan Party or to inspect the property (including the books and records) of
any Loan Party; (e) shall not be responsible to any Lender Party for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, any Loan Document or any
other instrument or document furnished pursuant thereto; and (f) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram,
telecopy or telex) believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 7.03. Fleet and Affiliates. With respect to its Commitments, the
Advances made by it and the Notes issued to it, Fleet shall have the same rights
and powers under the Loan Documents as any other Lender Party and may exercise
the same as though it were not the Administrative Agent; and the term "Lender
Party" or "Lenders Parties" shall, unless otherwise expressly indicated, include
Fleet in its individual capacity. Fleet and its affiliates may accept deposits
from, lend money to, act as trustee under indentures of, accept investment
banking engagements from and generally engage in any kind of business with, any
Loan Party, any of its Subsidiaries and any Person who may do business with or
own securities of any Loan Party or any such Subsidiary, all as if Fleet were
not the Administrative Agent and without any duty to account therefor to the
Lender Parties.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other Lender Party and based on the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon the Administrative Agent or any other Lender Party and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement.
SECTION 7.05. Indemnification. (a) Each Lender Party severally agrees to
indemnify the Administrative Agent (to the extent not promptly reimbursed by the
Borrower) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by, or asserted
against the Administrative Agent in any way relating to or arising out of the
Loan Documents or any action taken or omitted by the Administrative Agent under
the Loan Documents; provided, however, that no Lender Party shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender Party agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel) payable
by the Borrower under Section 8.04, to the extent that the Administrative Agent
is not promptly reimbursed for such costs and expenses by the Borrower. For
purposes of this Section 7.05(a), the Lender Parties' respective ratable shares
of any amount shall be determined, at any time, according to the sum of (a) the
aggregate principal amount of the Advances outstanding at such time and owing to
the respective Lender Parties, (b) their respective Pro Rata Shares of the
aggregate Available Amount of all Letters of Credit outstanding at such time,
(c) the aggregate unused portions of their respective Term A Commitments and
Term B Commitments at such time and (d) their respective Unused Working Capital
Commitments at such time; provided that the aggregate principal amount of Swing
Line Advances owing to the Swing Line Bank and of Letter of Credit Advances
owing to the Issuing Bank shall be considered to be owed to the Working Capital
Lenders ratably in accordance with their respective Working Capital Commitments.
In the event that any Defaulted Advance shall be owing by any Defaulting Lender
at any time, such Lender Party's Commitment with respect to the Facility under
which such Defaulted Advance was required to have been made shall be considered
to be unused for purposes of this Section 7.05(a) to the extent of the amount of
such Defaulted Advance. The failure of any Lender Party to reimburse the
Administrative Agent promptly upon demand for its ratable share of any amount
required to be paid by the Lender Party to the Administrative Agent as provided
herein shall not relieve any other Lender Party of its obligation hereunder to
reimburse the Administrative Agent for its ratable share of such amount, but no
Lender Party shall be responsible for the failure of any other Lender Party to
reimburse the Administrative Agent for such other Lender Party's ratable share
of such amount. Without prejudice to the survival of any other agreement of any
Lender Party hereunder, the agreement and obligations of each Lender Party
contained in this Section 7.05(a) shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents.
(b) Each Lender Party severally agrees to indemnify the Issuing Bank (to
the extent not promptly reimbursed by the Borrower) from and against such Lender
Party's ratable share (determined as provided below) of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against the Issuing Bank in any way relating to or
arising out of the Loan Documents or any action taken or omitted by the Issuing
Bank under the Loan Documents; provided, however, that no Lender Party shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Issuing Bank's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender Party agrees to reimburse the Issuing
Bank promptly upon demand for its ratable share of any costs and expenses
(including, without limitation, fees and expenses of counsel) payable by the
Borrower under Section 8.04, to the extent that the Issuing Bank is not promptly
reimbursed for such costs and expenses by the Borrower. For purposes of this
Section 7.05(b), the Lender Parties' respective ratable shares of any amount
shall be determined, at any time, according to the sum of (a) the aggregate
principal amount of the Advances outstanding at such time and owing to the
respective Lender Parties, (b) their respective Pro Rata Shares of the aggregate
Available Amount of all Letters of Credit outstanding at such time, (c) the
aggregate unused portions of their respective Term A Commitments and Term B
Commitments at such time plus (d) their respective Unused Working Capital
Commitments at such time; provided that the aggregate principal amount of Swing
Line Advances owing to the Swing Line Bank and of Letter of Credit Advances
owing to the Issuing Bank shall be considered to be owed to the Working Capital
Lenders ratably in accordance with their respective Working Capital Commitments.
In the event that any Defaulted Advance shall be owing by any Defaulting Lender
at any time, such Lender Party's Commitment with respect to the Facility under
which such Defaulted Advance was required to have been made shall be considered
to be unused for purposes of this Section 7.05(b) to the extent of the amount of
such Defaulted Advance. The failure of any Lender Party to reimburse the Issuing
Bank promptly upon demand for its ratable share of any amount required to be
paid by the Lender Parties to the Issuing Bank as provided herein shall not
relieve any other Lender Party of its obligation hereunder to reimburse the
Issuing Bank for its ratable share of such amount, but no Lender Party shall be
responsible for the failure of any other Lender Party to reimburse the Issuing
Bank for such other Lender Party's ratable share of such amount. Without
prejudice to the survival of any other agreement of any Lender Party hereunder,
the agreement and obligations of each Lender Party contained in this
Section 7.05(b) shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under the other Loan Documents.
SECTION 7.06. Successor Administrative Agents. The Administrative Agent may
resign as to any or all of the Facilities at any time by giving written notice
thereof to the Lender Parties and the Borrower and may be removed as to all of
the Facilities at any time with or without cause by the Required Lenders. Upon
any such resignation or removal, the Required Lenders shall have the right to
appoint a successor Administrative Agent as to such of the Facilities as to
which the Administrative Agent has resigned or been removed. If no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lender Parties, appoint a successor Administrative
Agent, which shall be a commercial bank organized under the laws of the United
States or of any State thereof and having a combined capital and surplus of at
least $250,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent as to all of the Facilities
and upon the execution and filing or recording of such financing statements, or
amendments thereto, and such amendments or supplements to the Mortgages, and
such other instruments or notices, as may be necessary or desirable, or as the
Required Lenders may request, in order to continue the perfection of the Liens
granted or purported to be granted by the Collateral Documents, such successor
Administrative Agent shall succeed to and become vested with all the rights,
powers, discretion, privileges and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged from its duties and
obligations under the Loan Documents. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent as to less
than all of the Facilities and upon the execution and filing or recording of
such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may be
necessary or desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents, such successor Administrative Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of
the retiring Administrative Agent as to such Facilities, other than with respect
to funds transfers and other similar aspects of the administration of Borrowings
under such Facilities, issuances of Letters of Credit (notwithstanding any
resignation as Administrative Agent with respect to the Letter of Credit
Facility) and payments by the Borrower in respect of such Facilities, and the
retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement as to such Facilities, other than as aforesaid.
After any retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent as to all of the Facilities, the provisions of this
Article VII shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent as to any Facilities under this
Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement or the Notes or any other Loan Document, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed (or, in the case of the Collateral
Documents, consented to) by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that (a) no amendment, waiver or
consent shall, unless in writing and signed by all of the Lenders (other than
any Lender Party that is, at such time, a Defaulting Lender), do any of the
following at any time: (i) waive any of the conditions specified in Section 3.01
or, in the case of the Initial Extension of Credit, Section 3.02, (ii) change
the number of Lenders or the percentage of (x) the Commitments, (y) the
aggregate unpaid principal amount of the Advances or (z) the aggregate Available
Amount of outstanding Letters of Credit that, in each case, shall be required
for the Lenders or any of them to take any action hereunder, (iii) reduce or
limit the obligations of the Guarantor under Section 1 of the Guaranty or
otherwise limit the Guarantor's liability with respect to the Obligations owing
to the Administrative Agent and the Lender Parties, (iv) release any material
portion of the Collateral in any transaction or series of related transactions
or permit the creation, incurrence, assumption or existence of any Lien on any
material portion of the Collateral in any transaction or series of related
transactions to secure any Obligations other than Obligations owing to the
Secured Parties under the Loan Documents and other than Debt owing to any other
Person, provided that, in the case of any Lien on any material portion of the
Collateral to secure Debt owing to any other Person, (A) the Borrower shall, on
the date such Debt shall be incurred or issued, prepay the Advances pursuant to,
and in the order of priority set forth in, Section 2.06(b)(ii) in an aggregate
principal amount equal to the amount of such Net Cash Proceeds to the extent
required to do so under Section 2.06(b)(ii), (B) such Lien shall be subordinated
to the Liens created under the Loan Documents on terms acceptable to the
Required Lenders and (C) the Required Lenders shall otherwise permit the
creation, incurrence, assumption or existence of such Lien and, to the extent
not otherwise permitted under Section 5.02(b), of such Debt, (v) amend this
Section 8.01, or (vi) limit the liability of any Loan Party under any of the
Loan Documents and (b) no amendment, waiver or consent shall, unless in writing
and signed by the Required Lenders and each Lender that has a Commitment under
the Term A Facility, Term B Facility or Working Capital Facility if affected by
such amendment, waiver or consent, (i) increase the Commitments of such Lender
or subject such Lender to any additional obligations, (ii) reduce the principal
of, or interest on, the Notes held by such Lender or any fees or other amounts
payable hereunder to such Lender, (iii) postpone any date fixed for any payment
of principal of, or interest on, the Notes held by such Lender or any fees or
other amounts payable hereunder to such Lender or (iv) change the order of
application of any prepayment set forth in Section 2.06 in any manner that
materially affects such Lender; provided further that no amendment, waiver or
consent shall, unless in writing and signed by the Swing Line Bank or the
Issuing Bank, as the case may be, in addition to the Lenders required above to
take such action, affect the rights or obligations of the Swing Line Bank or the
Issuing Bank, as the case may be, under this Agreement; and provided further
that no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above to take such
action, affect the rights or duties of the Administrative Agent under this
Agreement.
SECTION 8.02. Notices, Etc. All notices and other communications provided
for hereunder shall be in writing (including telegraphic, telecopy or telex
communication) and mailed, telegraphed, telecopied, telexed or delivered, if to
the Borrower, at its address at 675 Basket Road, Webster, New York 14580,
Attention: William J. Woodard; if to PSC, at its address at 675 Basket Road,
Webster, New York 14580, Attention: William J. Woodard; if to any Initial Lender
or the Initial Issuing Bank, at its Domestic Lending Office specified opposite
its name on Schedule I hereto; if to any other Lender Party, at its Domestic
Lending Office specified in the Assignment and Acceptance pursuant to which it
became a Lender Party; and if to the Administrative Agent, at its address at One
East Avenue, Rochester, New York 14638, Attention: Jeffrey Kenefick; or, as to
the Borrower or the Administrative Agent, at such other address as shall be
designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower and the Administrative Agent. All such notices
and communications shall, when mailed by certified mail, return receipt
requested; telegraphed, telecopied or telexed, be effective 3 days after
mailing, upon delivery to the telegraph company, upon transmission by telecopier
or upon confirmation by telex answerback, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II, III or VII
shall not be effective until received by the Administrative Agent. Delivery by
telecopier of an executed counterpart of any amendment or waiver of any
provision of this Agreement or the Notes or of any Exhibit hereto to be executed
and delivered hereunder shall be effective as delivery of a manually executed
counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender
Party or the Administrative Agent to exercise, and no delay in exercising, any
right hereunder or under any Note shall operate as a waiver thereof; nor shall
any single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to pay on demand
(i) all costs and expenses of the Administrative Agent and the Co-Arrangers in
connection with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents (including, without limitation,
(A)all due diligence, collateral review, syndication, (including printing,
distribution and bank meetings) transportation, computer, duplication,
appraisal, audit, insurance, consultant, search, filing and recording fees and
expenses, and (B) the reasonable fees and expenses of counsel for the
Administrative Agent and the Co-Arrangers with respect thereto, with respect to
advising the Administrative Agent as to its rights and responsibilities, or the
perfection, protection or preservation of rights or interests, under the Loan
Documents, with respect to negotiations with any Loan Party or with other
creditors of any Loan Party or any of its Subsidiaries arising out of any
Default or any events or circumstances that may give rise to a Default and with
respect to presenting claims in or otherwise participating in or monitoring any
bankruptcy, insolvency or other similar proceeding involving creditors' rights
generally and any proceeding ancillary thereto) and (ii) all costs and expenses
of the Administrative Agent and the Lender Parties in connection with the
enforcement of the Loan Documents, whether in any action, suit or litigation,
any bankruptcy, insolvency or other similar proceeding affecting creditors'
rights generally (including, without limitation, the reasonable fees and
expenses of counsel for the Administrative Agent and each Lender Party with
respect thereto).
(b) The Borrower agrees to indemnify and hold harmless the Administrative
Agent, the Co-Arrangers, each Lender Party and each of their Affiliates and
their officers, directors, employees, agents and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of, or in
connection with the preparation for a defense of, any investigation, litigation
or proceeding arising out of, related to or in connection with (i) the
Facilities, the actual or proposed use of the proceeds of the Advances or the
Letters of Credit by the Borrower or any of its subsidiaries or other affiliates
and any of the other transaction contemplated by the Loan Documents, (ii) any
acquisition or proposed acquisition or similar business combination or proposed
business combination by PSC or the Borrower or any of their subsidiaries or
affiliates of all or any portion of the shares of capital stock or substantially
all of the property and assets of any other person, (iii) the Facilities and any
use made or proposed to be made with the proceeds thereof or (iv) the actual or
alleged presence of Hazardous Materials on any property of any Loan Party or any
of its Subsidiaries or any Environmental Action relating in any way to any Loan
Party or any of its Subsidiaries, in each case whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders or creditors or an Indemnified Party or any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated, except to the extent such claim, damage,
loss, liability or expense is found in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted from such Indemnified Party's
gross negligence or willful misconduct. The Borrower also agrees not to assert
any claim against the Administrative Agent, any Lender Party or any of their
Affiliates, or any of their respective officers, directors, employees, attorneys
and agents, on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or otherwise relating to the Facilities, the
actual or proposed use of the proceeds of the Advances or the Letters of Credit,
the Loan Documents or any of the transactions contemplated thereby.
(c) If any payment of principal of, or Conversion of, any Eurodollar Rate
Advance is made by the Borrower to or for the account of a Lender Party other
than on the last day of the Interest Period for such Advance, as a result of a
payment or Conversion pursuant to Section 2.09(b)(i) or 2.10(d), acceleration of
the maturity of the Notes pursuant to Section 6.01 or for any other reason, or
by an Eligible Assignee to a Lender Party other than on the last day of the
Interest Period for such Advance upon an assignment of rights and obligations
under this Agreement pursuant to Section 8.07 as a result of a demand by the
Borrower pursuant to Section 8.07(a), the Borrower shall, upon demand by such
Lender Party (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender Party any amounts
required to compensate such Lender Party for any additional losses, costs or
expenses that it may reasonably incur as a result of such payment, including,
without limitation, any loss (including loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any Lender Party to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs, expenses or other
amounts payable by it under any Loan Document, including, without limitation,
fees and expenses of counsel and indemnities, such amount may be paid on behalf
of such Loan Party by the Administrative Agent or any Lender Party, in its sole
discretion.
(e) Without prejudice to the survival of any other agreement of any Loan
Party hereunder or under any other Loan Document, the agreements and obligations
of the Borrower contained in Sections 2.10 and 2.12 and this Section 8.04 shall
survive the payment in full of principal, interest and all other amounts payable
hereunder and under any of the other Loan Documents.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Lender Party and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender Party or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the Obligations of the Borrower now or hereafter existing under this
Agreement and the Note or Notes (if any) held by such Lender Party, irrespective
of whether such Lender Party shall have made any demand under this Agreement or
such Note or Notes and although such obligations may be unmatured. Each Lender
Party agrees promptly to notify the Borrower after any such set-off and
application; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
Party and its respective Affiliates under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
that such Lender Party and its respective Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower and the Administrative Agent and when
the Administrative Agent shall have been notified by each Initial Lender and the
Initial Issuing Bank that such Initial Lender and the Initial Issuing Bank has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Administrative Agent and each Lender Party and their respective
successors and assigns, except that the Borrower shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender may assign to
one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Commitment or Commitments, the Advances owing to it and the Note or Notes held
by it); provided, however, that (i) each such assignment shall be of a uniform,
and not a varying, percentage of all rights and obligations under and in respect
of one or more Facilities, (ii) except in the case of an assignment to a Person
that, immediately prior to such assignment, was a Lender or an assignment of all
of a Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000, (iii)
each such assignment shall be to an Eligible Assignee, (iv) no such assignments
shall be permitted without the consent of the Administrative Agent until the
Administrative Agent shall have notified the Lender Parties that syndication of
the Commitments hereunder has been completed, (V) no such assignment shall be
permitted if, immediately after giving effect thereto, the Borrower would be
required to make payments to or on behalf of the assignee Lender Party pursuant
to Section 2.10(a) or (b) and the assignor Lender Party was not at the time of
such assignment, entitled to receive any payment pursuant to Section 2.10(a) or
(b), and (vi) the parties to each such assignment shall execute and deliver to
the Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with any Note or Notes subject to such
assignment and a processing and recordation fee of $3,000.
(b) Upon such execution, delivery, acceptance and recording, from and after
the effective date specified in such Assignment and Acceptance, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender or Issuing Bank, as the
case may be, hereunder and (y) the Lender or Issuing Bank assignor thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's or Issuing Bank's rights and obligations under this Agreement, such
Lender or Issuing Bank shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance, the Lender
Party assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, this Agreement or any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto; (ii) such
assigning Lender Party makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or any
other Loan Party or the performance or observance by any Loan Party of any of
its obligations under any Loan Document or any other instrument or document
furnished pursuant thereto; (iii) such assignee confirms that it has received a
copy of this Agreement, together with copies of the financial statements
referred to in Section 4.01 and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon the Administrative Agent, such assigning Lender Party or
any other Lender Party and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Loan Documents as are delegated to the
Administrative Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all of the obligations which
by the terms of this Agreement are required to be performed by it as a Lender or
Issuing Bank, as the case may be.
(d) The Administrative Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Lender Parties and the Commitment under each Facility of, and principal amount
of the Advances owing under each Facility to, each Lender Party from time to
time (the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the
Administrative Agent and the Lender Parties may treat each Person whose name is
recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Lender Party at any reasonable time and from time to time upon reasonable prior
notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note or Notes subject
to such assignment, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit C
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. In the case of any assignment by a Lender, within five Business Days
after its receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the surrendered
Note or Notes a new Note to the order of such Eligible Assignee in an amount
equal to the Commitment assumed by it under a Facility pursuant to such
Assignment and Acceptance and, if the assigning Lender has retained a Commitment
hereunder under such Facility, a new Note to the order of the assigning Lender
in an amount equal to the Commitment retained by it hereunder. Such new Note or
Notes shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of Exhibit A-1, A-2 or A-3 hereto, as the case may be.
(f) The Issuing Bank may assign to an Eligible Assignee all of its
rights and obligations under the undrawn portion of its Letter of Credit
Commitment at any time; provided, however, that (i) each such assignment
shall be to an Eligible Assignee and (ii) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance,
together with a processing and recordation fee of $3,000.
(g) Each Lender Party may sell participations to one or more Persons
(other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitments, the Advances owing
to it and the Note or Notes (if any) held by it); provided, however, that
(i) such Lender Party's obligations under this Agreement (including,
without limitation, its Commitments) shall remain unchanged, (ii) such
Lender Party shall remain solely responsible to the other parties hereto
for the performance of such obligations, (iii) such Lender Party shall
remain the holder of any such Note for all purposes of this Agreement, (iv)
the Borrower, the Administrative Agent and the other Lender Parties shall
continue to deal solely and directly with such Lender Party in connection
with such Lender Party's rights and obligations under this Agreement and
(v) no participant under any such participation shall have any right to
approve any amendment or waiver of any provision of any Loan Document, or
any consent to any departure by any Loan Party therefrom, except to the
extent that such amendment, waiver or consent would reduce the principal
of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation,
postpone any date fixed for any payment of principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to
the extent subject to such participation, or release all or substantially
all of the Collateral.
(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 8.07, disclose to the assignee or participant or proposed assignee
or participant, any information relating to the Borrower furnished to such
Lender Party by or on behalf of the Borrower; provided, however, that,
prior to any such disclosure, the assignee or participant or proposed
assignee or participant shall agree to preserve the confidentiality of any
Confidential Information received by it from such Lender Party.
(i) Notwithstanding any other provision set forth in this Agreement,
any Lender Party may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.
SECTION 8.08. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.
SECTION 8.09. No Liability of the Issuing Bank. The Borrower assumes all
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any of its officers or directors shall be liable or responsible for:
(a) the use that may be made of any Letter of Credit or any acts or omissions of
any beneficiary or transferee in connection therewith; (b) the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by the Issuing Bank against presentation of
documents that do not comply with the terms of a Letter of Credit, including
failure of any documents to bear any reference or adequate reference to the
Letter of Credit; or (d) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except that the Borrower shall have
a claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower, to the extent of any direct, but not consequential, damages suffered
by the Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) the Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
SECTION 8.10. Confidentiality. Neither the Administrative Agent nor any
Lender Party shall disclose any Confidential Information to any Person without
the consent of the Borrower, other than (a) to the Administrative Agent's or
such Lender Party's Affiliates and their officers, directors, employees, agents
and advisors and to actual or prospective Eligible Assignees and participants,
and then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process and (c) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking.
SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York State court or federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Loan Documents to which it is a party, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Loan Documents in the
courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other Loan
Documents to which it is a party in any New York State or federal court. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
SECTION 8.12. Governing Law. This Agreement and the Notes shall be governed
by, and construed in accordance with, the laws of the State of New York.
SECTION 8.13. Waiver of Jury Trial. Each of the Borrower, the
Administrative Agent and the Lender Parties irrevocably waives all right to
trial by jury in any action, proceeding or counterclaim (whether based on
contract, tort or otherwise) arising out of or relating to any of the Loan
Documents, the Advances or the actions of the Administrative Agent or any Lender
Party in the negotiation, administration, performance or enforcement thereof.
ARTICLE IX
PSC GUARANTY
SECTION 9.01. PSC Guaranty. PSC unconditionally and irrevocably guarantees
(the undertaking by PSC under this Article IX being the "PSC Guaranty") the
punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all Obligations of each other Loan Party now or hereafter existing
under the Loan Documents, whether for principal, interest, fees, commissions,
expenses or otherwise (such Obligations being the "Guaranteed Obligations"), and
agrees to pay any and all expenses (including, without limitation, reasonable
fees and expenses of counsel) incurred by the Administrative Agent or any other
Secured Party in enforcing any rights under this PSC Guaranty. Without limiting
the generality of the foregoing, PSC's liability shall extend to all amounts
that constitute part of the Guaranteed Obligations and would be owed by any
other Loan Party to the Administrative Agent or any other Secured Party under
the Loan Documents but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving such other Loan Party.
SECTION 9.02. Guaranty Absolute. PSC guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan
Documents, regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent or any other Secured Party with respect thereto. The
Obligations of PSC under this PSC Guaranty are independent of the Guaranteed
Obligations or any other Obligations of any Loan Party under the Loan Documents,
and a separate action or actions may be brought and prosecuted against PSC to
enforce this PSC Guaranty, irrespective of whether any action is brought against
any other Loan Party or whether any other Loan Party is joined in any such
action or actions. The liability of PSC under this PSC Guaranty shall be
absolute, unconditional and irrevocable irrespective of, and PSC hereby
irrevocably waives any defenses it may now or hereafter have in any way relating
to, any and all of the following:
(a) any lack of validity or enforceability of any Loan Document or any
other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations or any other
Obligations of any Loan Party under the Loan Documents, or any other
amendment or waiver of or any consent to departure from any Loan Document
(including, without limitation, any increase in the Guaranteed Obligations
resulting from the extension of additional credit to any Loan Party or any
of its Subsidiaries or otherwise);
(c) any taking, exchange, release or nonperfection of any Collateral,
or any taking, release or amendment or waiver of or consent to departure
from any other guarantee, for all or any of the Guaranteed Obligations;
(d) any manner of application of Collateral, or proceeds thereof, to
all or any of the Guaranteed Obligations, or any manner of sale or other
disposition of any Collateral for all or any of the Guaranteed Obligations
or any other Obligations of any Loan Party under the Loan Documents, or any
other property and assets of any other Loan Party or any of its
Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any other Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan Party any
information relating to the financial condition, operations, properties or
prospects of any other Loan Party now or hereafter known to such Secured
Party; or
(g) any other circumstance (including, without limitation, any statute
of limitations or any existence of or reliance on any representation by the
Administrative Agent or any other Secured Party) that might otherwise
constitute a defense available to, or a discharge of, any other Loan Party,
PSC or any other guarantor or surety.
This PSC Guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Guaranteed Obligations is
rescinded or must otherwise be returned by the Administrative Agent or any other
Secured Party or by any other Person upon the insolvency, bankruptcy or
reorganization of any other Loan Party or otherwise, all as though such payment
had not been made.
SECTION 9.03. Waivers and Acknowledgments. (a) PSC hereby unconditionally
and irrevocably waives promptness, diligence, notice of acceptance and any other
notice with respect to any of the Guaranteed Obligations and this PSC Guaranty,
and any requirement that the PSC Guaranty or any other Secured Party protect,
secure, perfect or insure any Lien or any property or assets subject thereto or
exhaust any right or take any action against any other Loan Party or any other
Person or any Collateral.
(b) PSC hereby unconditionally and irrevocably waives any duty on the part
of the Administrative Agent or any other Secured Party to disclose to PSC any
matter, fact or thing relating to the business, operation or condition of any
other Loan Party or any of its Subsidiaries or its property and assets now or
hereafter known by the Administrative Agent or such Secured Party.
(c) PSC hereby unconditionally waives any right to revoke this PSC
Guaranty, and acknowledges that this PSC Guaranty is continuing in nature and
applies to all Guaranteed Obligations, whether existing now or in the future.
(d) PSC acknowledges that it will receive substantial direct and indirect
benefits from the financing arrangements contemplated by the Loan Documents and
that the waivers set forth in this Section 9.03 are knowingly made in
contemplation of such benefits.
SECTION 9.04. Subrogation. PSC hereby unconditionally and irrevocably
agrees not to exercise any rights that it may now have or may hereafter acquire
against any other Loan Party or any other insider guarantor that arise from the
existence, payment, performance or enforcement of the Obligations of PSC under
this PSC Guaranty or under any other Loan Document, including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution
or indemnification and any right to participate in any claim or remedy of the
Administrative Agent or any other Secured Party against such other Loan Party or
any other insider guarantor or any Collateral, whether or not such claim, remedy
or right arises in equity or under contract, statute or common law, including,
without limitation, the right to take or receive from such other Loan Party or
any other insider guarantor, directly or indirectly, in cash or other property
or by setoff or in any other manner, payment or security on account of such
claim, remedy or right, until such time as all of the Guaranteed Obligations and
all other amounts payable under this PSC Guarantee shall have been paid in full
in cash, all of the Letters of Credit shall have expired, terminated or been
cancelled and the Commitments shall have expired or terminated. If any amount
shall be paid to PSC in violation of the immediately preceding sentence at any
time prior to the latest of (a) the payment in full in cash of all of the
Guaranteed Obligations and all other amounts payable under this PSC Guaranty,
(b) the full drawing, termination, expiration or cancellation of all Letters of
Credit and, (c) the Termination Date, such amount shall be held in trust for the
benefit of the Administrative Agent and the other Secured Parties and shall
forthwith be paid to the Administrative Agent to be credited and applied to the
Guaranteed Obligations and all other amounts payable under this PSC Guaranty,
whether matured or unmatured, in accordance with the terms of the Loan
Documents, or to be held as Collateral for any Guaranteed Obligations or other
amounts payable under this PSC Guaranty thereafter arising. If (i) PSC shall pay
to the Administrative Agent all or any part of the Guaranteed Obligations, (ii)
all of the Guaranteed Obligations and all other amounts payable under this PSC
Guaranty shall have been paid in full in cash, (iii) all of the Letters of
Credit shall have expired, terminated or been cancelled, (iv) the Termination
Date shall have occurred, and (v) the Working Capital Termination Date shall
have occurred, the Administrative Agent and the other Secured Parties will, at
PSC's request and expense, execute and deliver to PSC appropriate documents,
without recourse and without representation or warranty, necessary to evidence
the transfer of subrogation to PSC of an interest in the Guaranteed Obligations
resulting from the payment made by PSC.
SECTION 9.05. Continuing Guarantee; Assignments. This PSC Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until the
latest of (i) the payment in full in cash of all of the Guaranteed Obligations
and all other amounts payable under this PSC Guaranty, (ii) the full drawing,
termination, expiration or cancellation of all Letters of Credit, and (iii) the
Termination Date, (b) be binding upon PSC, its successors and assigns and (c)
inure to the benefit of, and be enforceable by, the Administrative Agent and the
other Secured Parties and their respective successors, transferees and assigns.
Without limiting the generality of clause (c) of the immediately preceding
sentence, any Lender Party may assign or otherwise transfer all or any portion
of its rights and obligations under this Agreement (including, without
limitation, all or any portion of its Commitment or Commitments, the Advances
owing to it and the Notes held by it) to any other Person, and such other Person
shall thereupon become vested with all the benefits in respect thereof granted
to such Lender Party under this Article VI or otherwise, in each case as
provided in Section 8.07.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
PSC ACQUISITION INC.
By /s/ William J. Woodard
William J. Woodard
Title: VP - Finance
PSC INC.
By /s/ William J. Woodard
William J. Woodard
Title: VP - Finance
FLEET BANK, as Administrative Agent
By /s/ Jeff Kenefick
Jeff Kenefick
Title: Assistant VP
FLEET BANK, as Initial Issuing Bank
By /s/ Jeff Kenefick
Jeff Kenefick
Title: Assistant VP
Initial Lenders
CORESTATES BANK, N.A.
By /s/ Brian M. Haley
Brian M. Haley
Title: Vice President
FLEET BANK
By /s/ Jeff Kenefick
Jeff Kenefick
Title: Assistant VP
KEY BANK NATIONAL ASSOCIATION
By /s/ Lawrence A. Mack
Lawrence A. Mack
Title: Vice President
MANUFACTURERS & TRADERS
TRUST COMPANY
By /s/ Philip M. Smith
Philip M. Smith
Title:Regional Senior VP
PILGRIM AMERICA PRIME RATE TRUST
By /s/ Howard Tiffen
Howard Tiffen
Title:Senior Vice President
SUMITOMO BANK
By /s/ Brian M. Smith & James Drum
Brian M. Smith & James Drum
Title:Sr. VP Regional Mgr (East)
& VP NY Office
FORM OF TERM A NOTE
PROMISSORY NOTE
$ Dated: July __, 1996
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FOR VALUE RECEIVED, the undersigned, PSC Acquisition, Inc., a Delaware
corporation (together with the Surviving Corporation (as defined in the Credit
Agreement referred to below), the "Borrower"), HEREBY PROMISES TO PAY to the
order of Fleet Bank (the "Lender") for the account of its Applicable Lending
Office (as defined in the Credit Agreement referred to below) the principal
amount of the Term A Advance (as defined below) owing to the Lender by the
Borrower pursuant to the Credit Agreement, dated as of July __, 1996 (as
amended, supplemented or otherwise modified, the "Credit Agreement"; terms
defined therein being used herein as therein defined) among the Borrower, the
Lender and certain other lender parties thereto, Fleet Bank, as Initial Issuing
Bank, and Fleet Bank, as Administrative Agent for the Lender and such other
lender parties, on the dates and in the amounts specified in the Credit
Agreement.
The Borrower promises to pay interest on the unpaid principal amount of the
Term A Advance from the date of such Term A Advance until such principal amount
is paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Fleet Bank, as Administrative Agent, at One East Avenue,
Rochester, N.Y. 14638, Account No. 1983580, in same day funds. The Term A
Advance owing to the Lender by the Borrower and the maturity thereof, and all
payments made on account of principal thereof, shall be recorded by the Lender
and, prior to any transfer hereof, endorsed on the grid attached hereto, which
is part of this Promissory Note.
This Promissory Note is one of the Notes referred to in, and is entitled to
the benefits of, the Credit Agreement. The Credit Agreement, among other things,
(i) provides for the making of a single term advance (the "Term A Advance") by
the Lender to the Borrower in an amount not to exceed the U.S. dollar amount
first above mentioned, the indebtedness of the Borrower resulting from such Term
A Advance being evidenced by this Promissory Note, and (ii) contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayments on account of principal hereof prior to the
maturity hereof upon the terms and conditions therein specified. The obligations
of the Borrower under this Promissory Note, and the obligations of the other
Loan Parties under the Loan Documents, are secured by the Collateral as provided
in the Loan Documents.
This Promissory Note shall be governed by and construed in accordance with
the laws of the State of New York.
PSC ACQUISITION, INC.
By
Name:
Title:
Term Advances And Payments Of Principal
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Amount Of
Amount Of Principal Paid Unpaid Principal Notation
Date Term Advance Or Prepaid Balance Made By
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FORM OF TERM B NOTE
Promissory Note
$ Dated: July __, 1996
-----------------------------
FOR VALUE RECEIVED, the undersigned, PSC Acquisition, Inc., a Delaware
corporation (together with the Surviving Corporation (as defined in the Credit
Agreement referred to below), the "Borrower"), HEREBY PROMISES TO PAY to the
order of Pilgrim America Prime Rate Trust (the "Lender") for the account of its
Applicable Lending Office (as defined in the Credit Agreement referred to below)
the principal amount of the Term B Advance (as defined below) owing to the
Lender by the Borrower pursuant to the Credit Agreement, dated as of July __,
1996 (as amended, supplemented or otherwise modified, the "Credit Agreement";
terms defined therein being used herein as therein defined) among the Borrower,
the Lender and certain other lender parties thereto, Fleet Bank, as Initial
Issuing Bank, and Fleet Bank, as Administrative Agent for the Lender and such
other lender parties, on the dates and in the amounts specified in the Credit
Agreement.
The Borrower promises to pay interest on the unpaid principal amount of the
Term B Advance from the date of such Term B Advance until such principal amount
is paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Fleet Bank, as Administrative Agent, at One East Avenue,
Rochester, N.Y. 14638, Account No. 1983580, in same day funds. The Term B
Advance owing to the Lender by the Borrower and the maturity thereof, and all
payments made on account of principal thereof, shall be recorded by the Lender
and, prior to any transfer hereof, endorsed on the grid attached hereto, which
is part of this Promissory Note.
This Promissory Note is one of the Notes referred to in, and is entitled to
the benefits of, the Credit Agreement. The Credit Agreement, among other things,
(i) provides for the making of a single term advance (the "Term B Advance") by
the Lender to the Borrower in an amount not to exceed the U.S. dollar amount
first above mentioned, the indebtedness of the Borrower resulting from such Term
B Advance being evidenced by this Promissory Note, and (ii) contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayments on account of principal hereof prior to the
maturity hereof upon the terms and conditions therein specified. The obligations
of the Borrower under this Promissory Note, and the obligations of the other
Loan Parties under the Loan Documents, are secured by the Collateral as provided
in the Loan Documents.
This Promissory Note shall be governed by and construed in accordance with
the laws of the State of New York.
PSC ACQUISITION, INC.
By
Name:
Title:
Term Advances And Payments Of Principal
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Amount Of
Amount Of Principal Paid Unpaid Principal Notation
Date Term Advance Or Prepaid Balance Made By
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FORM OF TERM WORKING
CAPITAL ADVANCE
Promissory Note
$ Dated: July __, 1996
--------------------
FOR VALUE RECEIVED, the undersigned, PSC Acquisition, INC., a Delaware
corporation (together with the Surviving Corporation (as defined in the Credit
Agreement referred to below), the "Borrower"), HEREBY PROMISES TO PAY to the
order of Manufacturers & Traders Trust Company (the "Lender") for the account of
its Applicable Lending Office (as defined in the Credit Agreement referred to
below) the aggregate principal amount of the Working Capital Advances (as
defined below) owing to the Lender by the Borrower pursuant to the Credit
Agreement, dated as of July __, 1996 (as amended, supplemented or otherwise
modified, the "Credit Agreement"; terms defined therein being used herein as
therein defined) among the Borrower, the Lender and certain other lender parties
thereto, Fleet Bank, as Initial Issuing Bank, and Fleet Bank, as Administrative
Agent for the Lender and such other lender parties, on the Working Capital
Termination Date.
The Borrower promises to pay interest on the unpaid principal amount of
each Working Capital Advance from the date of such Working Capital Advance until
such principal amount is paid in full, at such interest rates, and payable at
such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Fleet Bank, as Administrative Agent, at One East Avenue,
Rochester, N.Y. 14638, Account No. 1983580, in same day funds. Each Working
Capital Advance owing to the Lender by the Borrower and the maturity thereof,
and all payments made on account of principal thereof, shall be recorded by the
Lender and, prior to any transfer hereof, endorsed on the grid attached hereto,
which is part of this Promissory Note.
This Promissory Note is one of the Notes referred to in, and is entitled to
the benefits of, the Credit Agreement. The Credit Agreement, among other things,
(i) provides for the making of working capital advances (the "Working Capital
Advances") by the Lender to the Borrower from time to time in an aggregate
amount not to exceed at any time outstanding the U.S. dollar amount first above
mentioned, the indebtedness of the Borrower resulting from each such Working
Capital Advance being evidenced by this Promissory Note, and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof upon the terms and conditions therein specified. The
obligations of the Borrower under this Promissory Note, and the obligations of
the other Loan Parties under the Loan Documents, are secured by the Collateral
referred to in the Collateral Documents.
This Note shall be governed by and construed in accordance with the laws of
the State of New York.
PSC ACQUISITION, INC.
By
Name:
Title:
Working Capital Advances And Payments Of Principal
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Date Amount Of Amount Of
Working Capital Principal Paid Unpaid Principal Notation
Advance Or Prepaid Balance Made By
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