EXECUTION COPY
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CREDIT AGREEMENT
AMONG
THE FINANCIAL INSTITUTIONS NAMED HEREIN
BANKBOSTON, N.A., AS ADMINISTRATIVE AGENT
U.S. BANK NATIONAL ASSOCIATION, AS DOCUMENTATION AGENT
NORTHWEST ALUMINUM COMPANY
NORTHWEST ALUMINUM SPECIALTIES, INC.
GOLDENDALE ALUMINUM COMPANY
AND
NORTHWEST ALUMINUM TECHNOLOGIES, LLC
Dated:
December 21, 1998
TABLE OF CONTENTS
SECTION I. DEFINITIONS................................................1
1.1 Definitions................................................1
1.2 Rules of Interpretation...................................19
SECTION II. DESCRIPTION OF CREDIT.....................................20
2.1 Loans.....................................................20
2.2 The Notes.................................................21
2.3 Notice and Manner of Borrowing
or Conversion of Loans....................................22
2.4 Funding of Loans..........................................22
2.5 Interest Rates and Payments of Interest. .................24
2.6 Fees......................................................26
2.7 Payments and Prepayments of the Loans.....................27
2.8 Method and Allocation of Payments.........................27
2.9 Eurodollar Indemnity......................................29
2.10 Computation of Interest and Fees..........................29
2.11 Changed Circumstances; Illegality.........................29
2.12 Increased Costs. ........................................31
2.13 Capital Requirements. ...................................31
2.14 Borrowers' Representatives................................32
SECTION IIA LETTERS OF CREDIT.........................................33
2A.1 Issuance..................................................33
2A.3 Letter of Credit Payments.................................34
2A.4 Obligations Absolute......................................35
2A.5 Reliance by the Issuing Bank and
the Administrative Agent..................................35
SECTION III. CONDITIONS OF LOANS AND LETTERS OF CREDIT.................36
3.1 Conditions Precedent to Initial Loans.....................36
3.2 Conditions Precedent to all Loans
and Letters of Credit.....................................38
SECTION IV. REPRESENTATIONS AND WARRANTIES............................39
4.1 Organization; Qualification; Business.....................40
4.2 Corporate Authority.......................................40
4.3 Valid Obligations.........................................40
4.4 Consents or Approvals.....................................41
4.5 Title to Properties; Absence of Encumbrances..............41
4.6 Financial Statements......................................41
4.7 Changes...................................................42
4.8 Solvency..................................................42
4.9 Defaults..................................................42
4.10 Taxes.....................................................42
4.11 Litigation................................................43
4.12 Subsidiaries..............................................43
4.13 Investment Company Act....................................43
4.14 Compliance................................................43
4.15 ERISA.....................................................44
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4.16 Environmental Matters.....................................44
4.17 Restrictions on the Borrowers.............................46
4.18 Labor Relations...........................................46
4.19 Margin Rules..............................................46
4.20 Disclosure................................................46
SECTION V. AFFIRMATIVE COVENANTS.....................................47
5.1 Financial Statements......................................47
5.2 Conduct of Business.......................................49
5.3 Maintenance and Insurance.................................50
5.4 Taxes.....................................................50
5.5 Inspection................................................50
5.6 Maintenance of Books and Records..........................51
5.7 Use of Proceeds...........................................51
5.8 Further Assurances........................................51
5.9 Notification Requirements.................................52
5.10 ERISA Reports.............................................52
5.11 Loss or Depreciation of Collateral........................53
5.12 Environmental Compliance..................................53
5.13 Year 2000 Compliance......................................54
5.14 Tolling Agreements; Commingling...........................54
SECTION VI. FINANCIAL COVENANTS.......................................55
6.1 Net Worth.................................................55
6.2 Minimum Excess Availability...............................55
6.3 Capital Expenditures......................................55
SECTION VII. NEGATIVE COVENANTS........................................55
7.1 Indebtedness..............................................55
7.2 Contingent Liabilities....................................56
7.3 Encumbrances..............................................56
7.4 Merger; Consolidation; Sale or Lease of Assets............58
7.5 Speculative Commodity Transactions........................58
7.6 Restricted Payments.......................................58
7.7 Investments; Purchases of Assets..........................59
7.8 ERISA Compliance..........................................60
7.9 Transactions with Affiliates..............................60
7.10 Fiscal Year...............................................61
SECTION VIII. DEFAULTS..................................................61
8.1 Events of Default.........................................61
8.2 Remedies..................................................64
SECTION IX. ASSIGNMENT AND PARTICIPATION..............................65
9.1 Assignment................................................65
9.2 Participations............................................66
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SECTION X. THE AGENTS................................................67
10.1 Appointment of Agents; Powers and Immunities..............67
10.2 Actions by Agents.........................................68
10.3 Indemnification...........................................69
10.4 Reimbursement.............................................70
10.5 Non-Reliance on Agents and Other Lenders..................70
10.6 Resignation or Removal of an Agent........................71
10.7 Intercreditor Agreements..................................71
SECTION XI. MISCELLANEOUS.............................................72
11.1 Notices...................................................72
11.2 Expenses..................................................73
11.3 Indemnification...........................................74
11.4 Survival of Covenants, Etc................................74
11.5 Set-Off...................................................75
11.6 No Waivers................................................75
11.7 Amendments, Waivers, etc..................................75
11.8 Binding Effect of Agreement...............................76
11.9 Captions; Counterparts....................................76
11.10 Entire Agreement, Etc.....................................77
11.11 Waiver of Jury Trial......................................77
11.12 Governing Law.............................................77
11.13 Severability..............................................77
SCHEDULES
SCHEDULE 1 - Commitments of the Lenders
EXHIBITS
EXHIBIT A - Form of Revolving Credit Note
EXHIBIT B - Form of Notice of Borrowing or Conversion
EXHIBIT C - Disclosure
EXHIBIT D - Form of Report of Chief Financial Officer
EXHIBIT E - Form of Borrowing Base Report
EXHIBIT F - Assignment and Joinder Agreement
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is made as of December 21, 1998, by and among
NORTHWEST ALUMINUM COMPANY ("NAC"), NORTHWEST ALUMINUM SPECIALTIES, INC.
("NAS"), NORTHWEST ALUMINUM TECHNOLOGIES, LLC ("NAT") and GOLDENDALE ALUMINUM
COMPANY ("GAC") (each, individually a "Borrower" and, collectively, the
"Borrowers"); BANKBOSTON, N.A. ("BKB"); the other financial institutions listed
on Schedule 1 attached hereto (together with BKB, the "Lenders"); BANKBOSTON,
N.A., as agent for the Lenders (in such capacity, the "Administrative Agent");
and U.S. BANK NATIONAL ASSOCIATION ("US Bank"), as Documentation Agent.
WHEREAS, NAC, NAS and NAT are wholly owned Subsidiaries of, and Goldendale
Holding Company, a Delaware corporation ("Holding"), is a Subsidiary of Golden
Northwest Aluminum, Inc., an Oregon corporation ("GNA"), and GAC is a wholly
owned Subsidiary of Holding.
WHEREAS, the business relationships among the Borrowers as Subsidiaries of
GNA will provide numerous benefits to them;
WHEREAS, in order to recognize and support the interrelationships of the
Borrowers and to free the management of the Borrowers to best allocate resources
within the corporate group of GNA and its Subsidiaries, the Borrowers have
requested the Lenders to extend credit in the form of loans and letters of
credit, and the Lenders are willing to make loans to the Borrowers and the
Issuing Bank is willing to issue Letters of Credit, in each case on the terms
and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
I.
DEFINITIONS
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1.1 Definitions.
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All capitalized terms used in this Agreement or in the Notes or in any
certificate, report or other document made or delivered pursuant to this
Agreement (unless otherwise defined therein) shall have the meanings assigned to
them below:
Accounts Receivable or Accounts. All of the Borrowers' accounts, accounts
receivable, notes, bills, drafts, acceptances, instruments, documents, chattel
paper and all other debts,
obligations and liabilities in whatever form owing to the Borrowers from any
Person for goods sold by them or for services rendered by them, or however
otherwise established or created, all guarantees and security therefor, all
right, title and interest of the Borrowers in the goods or services which gave
rise thereto, including rights to reclamation and stoppage in transit and all
rights of an unpaid seller of goods or services; whether any of the foregoing be
now existing or hereafter arising, now or hereafter received by or owing or
belonging to the Borrowers.
Administrative Agent. BKB.
Affected Loans. See Section 2.11(a).
Affiliate. With reference to any Person, (i) any director, officer or
employee of that Person, (ii) any other Person controlling, controlled by or
under direct or indirect common control of that Person, (iii) any other Person
directly or indirectly holding 5% or more of any class of the capital stock or
other equity interests (including options, warrants, convertible securities and
similar rights) of that Person and (iv) any other Person 5% or more of any class
of whose capital stock or other equity interests (including options, warrants,
convertible securities and similar rights) is held directly or indirectly by
that Person; provided, however, that for purposes of the definitions of "Plan"
and "Multiemployer Plan" in this Section 1.1 and for purposes of Sections 4.15,
5.10, 7.9 and 8.1(i) hereof, "Affiliate" shall mean, within the meaning of
Section 414(b), (c), (m) or (o) of the Code, only (i) any member of a controlled
group of corporations which includes any of the Borrowers or any Subsidiary of a
Borrower, (ii) any trade or business, whether or not incorporated, under common
control with any of the Borrowers or any Subsidiary of a Borrower, (iii) any
member of an affiliated service group which includes any of the Borrowers or any
Subsidiary of a Borrower, and (iv) any member of a group treated as a single
employer by regulation with a Borrower or a Subsidiary of a Borrower.
Agents. The Administrative Agent and the Documentation Agent.
Agreement. This Credit Agreement, including the Exhibits and Schedules
hereto, as the same may be supplemented or amended from time to time.
Alternate Base Rate. The greater of (i) the rate of interest announced from
time to time by the Administrative Agent at its head office as its "Base Rate",
and (ii) the Federal Funds Effective Rate plus 1/2 of 1% per annum (rounded
upwards, if necessary, to the next 1/8 Of 1%).
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Applicable Margin. As of any date, with respect to Eurodollar Loans, Base
Rate Loans or Letter of Credit Fees, the applicable percentage set forth below
opposite the applicable Interest Coverage Ratio:
Applicable Margin
----------------------------------------------------
Interest Eurodollar Base Rate Letter of
Coverage Ratio Loans Loans Credit Fees
- --------------------- ---------- --------- -----------
greater than or equal 2.00% 0.50% 2.00%
to 2.00:1.00
less than 2.00:1.00 2.25% 0.75% 2.25%
and greater than or
equal to 1.50:1.00
less than 1.50:1.00 2.50% 1.00% 2.50%
Attorneys' Fees. See Section 11.2.
Base Rate Loan. Any Loan bearing interest determined with reference to the
Alternate Base Rate.
Borrowers. As defined in the Preamble and any other wholly-owned Subsidiary
of GNA, Holding or a Borrower that has executed a joinder agreement in form
reasonably satisfactory to the Administrative Agent and has become a party to
the Loan Documents as a "Borrower" thereunder.
Borrowers' Accountants. BDO Seidman, LLP or other independent certified
public accountants selected by the Borrowers and reasonably acceptable to the
Administrative Agent.
Borrowing Base. An amount equal to (a) the sum of (i) 85% of the unpaid
face amount of all Eligible Accounts, plus (ii) 75% of all Eligible Aluminum
Inventory and 50% of all other Eligible Inventory, minus (b) Borrowing Base
Reserves, if any, at the date of determination of the Borrowing Base.
Borrowing Base Report. A report signed by any Responsible Officer and in
substantially the form of Exhibit E hereto.
Borrowing Base Reserves. At the time of any determination of the Borrowing
Base, such reserves as the Administrative Agent may from time to time determine,
in the exercise of its reasonable credit judgment, to establish.
Business Day. (i) For all purposes other than as covered by clause (ii)
below, any day other than a Saturday, Sunday or legal holiday on which banks in
Boston, Massachusetts are open for the conduct of a substantial part of their
commercial banking
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business; and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day that
is a Business Day described in clause (i) and that is also a day for trading by
and between banks in U.S. Dollar deposits in the interbank Eurodollar market.
Capital Expenditures. Without duplication, any expenditure for fixed or
capital assets, leasehold improvements, capital leases, installment purchases of
machinery and equipment, acquisitions of real estate and other similar
expenditures including (i) in the case of a purchase, the entire purchase price
(whether or not paid during the fiscal period in question) to the extent
required to be recorded under GAAP as of the time of determination, (ii) in the
case of a capital lease, the entire amount capitalized under GAAP as of the time
of determination, and (iii) expenditures in any construction in progress account
of the Borrowers; provided, however that cell relining costs, including the
costs of rebuilding anodes and cathodes, incurred in the ordinary course of
business and consistent with past practices, shall not be included in "Capital
Expenditures", whether or not capitalized for book or tax purposes.
Closing Date. The first date on which the conditions set forth in Sections
3.1 and 3.2 have been satisfied and any Loans are to be made hereunder.
Code. The Internal Revenue Code of 1986 and the rules and regulations
thereunder, collectively, as the same may from time to time be supplemented or
amended and remain in effect.
Collateral. All of the property, rights and interests of the Borrowers and
their Subsidiaries that are or are intended to be subject to the security
interests and liens created by the Security Documents.
Commitment. In relation to any particular Lender, the maximum dollar amount
which such Lender has agreed to loan to the Borrowers or make available to the
Borrowers pursuant to Letter of Credit Participations upon the terms and subject
to the conditions of this Agreement, initially as set forth on Schedule 1
attached hereto and as such Lender's Commitment may be modified pursuant hereto
and in effect from time to time. Schedule 1 shall be amended from time to time
to reflect any changes in the Commitments of the Lenders.
Commitment Fee. See Section 2.6(a).
Commitment Percentage. In relation to any particular Lender, the percentage
which such Lender's Commitment represents of the aggregate Commitments of all
the Lenders, initially as set forth on Schedule 1 attached hereto, as such
Lender's Commitment Percentage may be modified pursuant hereto and in effect
from
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time to time. Schedule 1 shall be amended from time to time to reflect any
changes in the Commitment Percentages of the Lenders.
Consolidated Net Income. For any fiscal period, the consolidated gross
revenues of GNA and its Subsidiaries for such period, less all expenses and
other proper charges, all determined in accordance with GAAP, but in any event
there shall be excluded or deducted from such gross revenues: (i) any gain or
loss arising from any write-up of assets, except to the extent inclusion thereof
shall be approved in writing by the Majority Lenders; (ii) earnings of any
Subsidiary accrued prior to the date it became a Subsidiary; (iii) any
extraordinary or nonrecurring gains; (iv) any deferred or other credit
representing any excess of the equity of any Subsidiary at the date of
acquisition thereof over the amount invested in such Subsidiary; (v) the net
earnings of any business entity (other than a Subsidiary) in which GNA or any
Subsidiary has an ownership interest, except to the extent such net earnings
shall have actually been received by GNA or such Subsidiary in the form of cash
distributions; (vi) the proceeds of any life insurance policy; (vii) any
reversal of any contingency reserve, except to the extent that provision for
such contingency reserve shall be made from income arising during such period;
and (viii) for any period when a Borrower is an S Corporation, an amount equal
to the Sub S Distribution Amount with respect to such Borrower.
Consolidated Net Worth. At any date as of which the amount thereof shall be
determined, the consolidated total assets of GNA and its Subsidiaries, with
Inventory and cost of goods determined on an average "first in, first out" basis
consistent with the Borrowers' past practices, plus the value of the minority
interests in Holding, and minus (a) Consolidated Total Liabilities and (b) the
sum of any amounts attributable to (i) all reserves not already deducted from
assets or included in Consolidated Total Liabilities, (ii) any write-up in the
book value of assets resulting from any revaluation thereof subsequent to the
date of the Initial Financial Statements, (iii) intercompany accounts with
Subsidiaries and Affiliates (including receivables due from Subsidiaries and
Affiliates), (iv) the value, if any, attributable to any capital stock of GNA or
any Subsidiary held in treasury, (v) the value, if any, attributable to any
notes or subscriptions receivable due from stockholders in respect of capital
stock; and, (vi) an amount equal to the excess, if any, of the Sub S
Distribution Amount for the twelve months preceding the date of computation of
Consolidated Net Worth over the total amount distributed to stockholders in
respect to such twelve month period pursuant to Section 7.6(b) and deducted in
computing such Consolidated Net Worth.
Consolidated Total Liabilities. At any date as of which the amount thereof
shall be determined, all obligations that should, in accordance with GAAP, be
classified as liabilities on the
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consolidated balance sheet of GNA and its Subsidiaries, including in any event
all Indebtedness but excluding the value of any minority interests in
Subsidiaries.
Continuing Directors. Any member of the Board of Directors of GNA who (i)
was a member of such Board of Directors on December 21, 1998, or (ii) was
nominated for election or elected or appointed to such Board of Directors by the
Board of Directors of GNA at a time when a majority of such Board (excluding any
member whose service terminated as a result of death) consisted of Continuing
Directors.
Contra Customer. Any customer or other Person with whom any Borrowers has a
contract or agreement of any kind (including an account payable) and in respect
of whom there is an Account included in Eligible Accounts.
Default. An Event of Default or event or condition that, but for the
requirement that time elapse or notice be given, or both, would constitute an
Event of Default.
Documentation Agent. US Bank.
Drawdown Date. The Business Day on which any Loan is made or is to be made.
EBITDA. For any fiscal period, an amount equal to Consolidated Net Income
for such period, plus the following, to the extent deducted or excluded in
computing such Consolidated Net Income: (i) Interest Expense, (ii) taxes, (iii)
depreciation, (iv) amortization, and (v) the Sub S Distribution Amount plus the
amount of any distribution in respect of interest and penalties as permitted by
Section 7.6(b) which are not otherwise deducted in computing Consolidated Net
Income.
Eligible Accounts. An Account Receivable which:
(a) is not unpaid more than 90 days after invoice date under the original
terms of sale and not more than 60 days past due, unless the original terms of
sale are 90 days, in which event such Account Receivable shall not be unpaid
more than 120 days after invoice date and not more than 60 days past due;
(b) arose in the ordinary course of a Borrower's business as a result of
services which have been performed for the account debtor or the sale of goods
which have been shipped to the account debtor;
(c) is the legal, valid and binding obligation of the account debtor
thereunder, is assignable, is owned by a Borrower free and clear of all
Encumbrances (except in favor of the Administrative Agent) and is subject to a
valid, perfected first
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security interest of the Administrative Agent (and, if the account debtor is the
United States of America or any agency or instrumentality thereof, the
Borrower's right to payment has been assigned to the Administrative Agent in
compliance with the Assignment of Claims Act of 1940, as amended) and is not
evidenced by a promissory note or other instrument;
(d) has not been reduced and is not subject to reduction, as against the
Borrowers, their agents or the Administrative Agent, by any offset,
counterclaim, adjustment, credit, allowance or other defense, and as to which
there is no (and no basis for any) return, rejection, loss or damage of or to
the goods giving rise thereto, or any request for credit or adjustments;
(e) is not difficult to collect or uncollectible for any reason, including,
without limitation, return, rejection, repossession, loss or damage of or to the
merchandise giving rise thereto, a merchandise or other dispute, any bankruptcy,
insolvency, adverse credit rating or other financial difficulty of the account
debtor, or any impediment to the assertion of a claim or commencement of an
action against the account debtor (including as a consequence of a failure of
the Borrowers to be qualified or licensed in any jurisdiction where such
qualification or licensing is required), all as reasonably determined by the
Administrative Agent in its sole discretion;
(f) is not owing from any Affiliate of the Borrowers;
(g) is owing from an account debtor (i) located in the United States, or
(ii) located outside of the United States if, (x) the payment of each Account
owing from an account debtor located outside of the United States is secured by
a letter of credit satisfactory in amount and terms to the Administrative Agent
and issued by a bank satisfactory to the Administrative Agent or is otherwise
secured or payment thereof is otherwise assured in a manner reasonably
satisfactory to the Administrative Agent, and (y) the aggregate amount of such
Accounts included in Eligible Accounts shall not at any time exceed $5,000,000;
(h) is owing from an account debtor at least 80% of whose accounts payable
owing to the Borrowers are Eligible Accounts;
(i) if owing from any Contra Customer, will be deemed eligible (x) if and
to the extent the Contra Customer has executed and delivered to the
Administrative Agent a waiver of its right of set-off in form reasonably
satisfactory to the Administrative Agent, or (y) if no such waiver has been
executed and delivered, only to the extent such Account exceeds the total amount
of the Borrowers' accounts payable to such Contra Customer; and
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(j) has not been designated by the Administrative Agent, in the exercise of
its reasonable credit judgment, by notice to the Borrowers as unacceptable for
any reason.
Eligible Aluminum Inventory. Eligible Inventory of the Borrowers consisting
of finished aluminum which is of good merchantable quality and is in industry
standard, readily-saleable form and as to which there exists an organized
terminal market.
Eligible Commodity Contracts. Commodity futures contracts, commodity swap
agreements, options on commodity swap agreements and any other agreements or
arrangements, in each case designed to provide protection against fluctuations
in commodity prices and not designed or used to engage in speculative
transactions with respect to commodities.
Eligible Interest Rate Contracts. Interest Rate Contracts approved by the
Administrative Agent (such approval not to be unreasonably withheld or delayed).
Eligible Inventory. Inventory of the Borrowers:
(a) which is finished goods or raw materials in first class condition,
merchantable and saleable through normal trade channels;
(b) which is not work-in-process, bath in cells, capitalized labor, cast
house spare parts or Stores Inventory, is not damaged or defective, and is not
obsolete, waste or defective goods;
(c) calculated at the lesser of fair market value or cost determined on an
average "first-in, first-out" basis, consistent with the Borrowers' past
practices, after taking into account charges and Encumbrances (other than those
in favor of the Administrative Agent) of all kinds against such Inventory and
changes from time to time and at any time in the market value thereof, all as
reasonably determined by the Administrative Agent in its discretion; provided
that the fair market value of Eligible Aluminum Inventory shall be determined
based on the Mid-West, U.S. Transaction Week average price, as published by
Platt's Metals Week;
(d) as to which the Borrowers have good title, free and clear of all
Encumbrances (except in favor of the Administrative Agent), and the
Administrative Agent has a valid, perfected first lien;
(e) which is not consigned to any Person, except to the extent that the
Borrowers have made, to the reasonable satisfaction of the Administrative Agent,
all filings under
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applicable law to preserve the interest of the Borrowers and the Administrative
Agent in such consigned Inventory; provided that in no event shall Eligible
Inventory include more than $5,000,000 of consigned Inventory at any time;
(f) which is not subject to any Tolling Agreement;
(g) which is located where the Borrowers are permitted to keep their
Inventory in accordance with the Security Documents; and
(h) which has not been designated by the Administrative Agent, in the
exercise of its reasonable credit judgment, by notice to the Borrowers as
unacceptable for any reason.
Encumbrances. See Section 7.3.
ERISA. The Employee Retirement Income Security Act of 1974 and the rules
and regulations thereunder, collectively, as the same may from time to time be
supplemented or amended and remain in effect.
Environmental Laws. Any and all applicable federal, state and local
environmental, health or safety statutes, laws, regulations, rules and
ordinances (whether now existing or hereafter enacted or promulgated), and all
applicable judicial, administrative and regulatory decrees, judgments and
orders, including common law rulings and determinations, relating to injury to,
or the protection of, real or personal property or human health or the
environment, including, without limitation, all requirements pertaining to
reporting, licensing, permitting, investigation, remediation and removal of
emissions, discharges, releases or threatened releases of Hazardous Materials
into the environment or relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of such Hazardous
Materials.
Eurodollar Loan. Any Loan bearing interest at a rate determined with
reference to the Eurodollar Rate.
Eurodollar Rate. With respect to any Eurodollar Loan for any Interest
Period, the rate of interest determined by the Administrative Agent to be the
prevailing rate per annum at which deposits in U.S. Dollars are offered to the
Administrative Agent by first-class banks in the interbank Eurodollar market in
which it regularly participates on or about 10:00 a.m. (Boston time) two
Business Days before the first day of such Interest Period in an amount
approximately equal to the principal amount of the Eurodollar Loan to which such
Interest Period is to apply for a period of time approximately equal to such
Interest Period.
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Eurodollar Reserve Percentage. For any Interest Period, the aggregate of
the maximum reserve percentages (including any marginal, special, emergency or
supplemental reserves), expressed as a decimal, established by the Board of
Governors of the Federal Reserve System and any other banking authority,
domestic or foreign, to which any Lender is subject with respect to
"Eurocurrency Liabilities" (as defined in regulations issued from time to time
by such Board of Governors). The Eurodollar Reserve Percentage shall be adjusted
automatically on and as of the effective date of any change in any such reserve
percentage.
Event of Default. Any event described in Section 8.1.
Facilities Investment Program. Projects for the expansion of GAC's
casthouse and the upgrade of GAC's and NAC's cell lines, including, among other
things, point-feeders to control alumina additions, magnetic compensation to
stabilize cell operations, cathode redesign to optimize heat balance, computer
controls and other related technological improvements.
Federal Funds Effective Rate. For any day, a fluctuating interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, 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 on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent.
Fees. Commitment Fees, Letter of Credit Fees and Fronting Fees.
Fronting Fee. See Section 2.6.
GAAP. Generally accepted accounting principles, consistently applied
(except any change in application in connection with the capitalization of cell
relining costs), and as in effect as of the date of application thereof.
Glencore Tolling Agreement. The Aluminum Toll Conversion Agreement between
Glencore Ltd. (formerly Clarendon Ltd.) and NAC dated September 15, 1986, as
amended and extended as of May 4, 1988, October 1, 1991, March 1, 1992 and
September 21, 1994.
Guarantees. As applied to the Borrowers, all guarantees, endorsements or
other contingent or surety obligations with respect to obligations of others,
whether or not reflected on the consolidated balance sheet of GNA and its
Subsidiaries, including
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any obligation to furnish funds, directly or indirectly (whether by virtue of
partnership arrangements, by agreement to keep-well or otherwise), through the
purchase of goods, supplies or services, or by way of stock purchase, capital
contribution, advance or loan, or to enter into a contract for any of the
foregoing, for the purpose of payment of obligations of any other Person or
entity.
Hazardous Material. Any substance (i) the presence of which requires or may
hereafter require notification, removal or remediation under any Environmental
Law; (ii) which is or becomes defined as a "hazardous waste", "hazardous
material" or "hazardous substance" under any present or future Environmental Law
or amendments thereto including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601
et seq.) and any applicable local statutes and the regulations promulgated
thereunder; (iii) which is toxic, explosive, corrosive, flammable, infectious,
radioactive, carcinogenic, mutagenic or otherwise hazardous and which is or
becomes regulated pursuant to any Environmental Law by any governmental
authority, agency, department, commission, board, agency or instrumentality of
the United States, any state of the United States, or any political subdivision
thereof; or (iv) without limitation, which contains gasoline, diesel fuel or
other petroleum products, asbestos or polychlorinated biphenyls ("PCB's").
Holding Guaranty. The Guaranty of even date herewith made by Holding in
favor of the Agents, the Lenders and the Issuing Bank, guarantying all
Obligations.
Holding Preferred Stock. The shares of Preferred Capital Stock of Holding
now or hereafter owned by the ESOP.
Hydro. Norsk Hydro USA, Inc., a Delaware corporation.
Hydro Debt. All Indebtedness and other obligations of GNA and the Borrowers
under the Hydro Debt Documents.
Hydro Debt Documents. The Subordinated Note Purchase Agreement of even date
herewith between GNA and Hydro, the subordinated notes issued by GNA to Hydro
pursuant thereto, the Pledge Agreement of even date herewith between GNA and
Hydro, the Subsidiary Pledge Agreement of even date herewith between Holding and
Hydro, the Subsidiary Guaranty of even date herewith made by the Borrowers and
Holding in favor of Hydro and the Security Agreement of even date herewith among
the Borrowers, Holding and Hydro, all as in effect on the date hereof, without
giving effect to any amendment, modification or supplement thereto.
Hydro Security Documents. The "Collateral Documents" (as such term is
defined in the Hydro Debt Documents), as in effect
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on the date hereof, without giving effect to any amendment, modification or
supplement thereto.
Hydro Tolling Agreement. The Agreement to Toll Convert Alumina into
Aluminum (Tolling Contract), dated as of May 22, 1996, between GAC and Hydro
Aluminum Louisville, Inc., as amended to date.
Indebtedness. As applied to GNA and its Subsidiaries, without duplication,
(i) all obligations for borrowed money or other extensions of credit, whether
secured or unsecured, absolute or contingent, including, without limitation,
unmatured reimbursement obligations with respect to letters of credit or
guarantees issued for the account of or on behalf of GNA and its Subsidiaries
and all obligations representing the deferred purchase price of property, other
than accounts payable and accrued liabilities arising in the ordinary course of
business, (ii) all obligations evidenced by bonds, notes, debentures or other
similar instruments, (iii) all obligations secured by any mortgage, pledge,
security interest or other lien on property owned or acquired by GNA or any of
its Subsidiaries, whether or not the obligations secured thereby shall have been
assumed, (iv) that portion of all obligations arising under leases that is
required to be capitalized on the consolidated balance sheet of GNA and its
Subsidiaries, (v) all Guarantees, (vi) all obligations that are immediately due
and payable out of the proceeds of or production from property now or hereafter
owned or acquired by GNA or any of its Subsidiaries, and (vii) obligations in
respect of Interest Rate Contracts and Eligible Commodity Contracts.
Initial Financial Statements. See Section 4.6.
Initial Lenders. BKB and the other financial institutions who have signed
this Agreement and have become Lenders on the date hereof.
Intercreditor Agreements. The Intercreditor Agreement of even date herewith
between the Administrative Agent and U.S. Trust Company, National Association,
as Trustee, and the Intercreditor and Subordination Agreement of even date
herewith between the Administrative Agent and Norsk Hydro USA, Inc., in each
case as amended from time to time.
Interest Coverage Ratio. As of the end of any month, the ratio of EBITDA to
Interest Expense for the twelve consecutive months then ended.
Interest Expense. For any fiscal period, the consolidated interest expense
(including imputed interest on capitalized lease
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obligations) and amortized debt discount on Indebtedness of GNA and its
Subsidiaries for such period.
Interest Period. With respect to each Eurodollar Loan, the period
commencing on the date of the making or continuation of or conversion to such
Eurodollar Loan and ending one (1), two (2), three (3) or six (6) months
thereafter, or, if consented to by all the Lenders, twelve (12) months
thereafter, as the Borrowers may elect in the applicable Notice of Borrowing or
Conversion; provided that:
(i) any Interest Period (other than an Interest Period determined
pursuant to clause (iii) below) that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in the next calendar month, in which case
such Interest Period shall end on the immediately preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall,
subject to clause (iii) below, end on the last Business Day of a calendar
month;
(iii) any Interest Period that would otherwise end after the Maturity
Date of a Loan shall end on such Maturity Date; and
(iv) notwithstanding clause (iii) above, no Interest Period shall have
a duration of less than one month, and if any Interest Period applicable to
a Loan would be for a shorter period, such Interest Period shall not be
available hereunder.
Interest Rate Contracts. Interest rate swap agreements, interest rate
collar agreements, options on any of the foregoing and any other agreements or
arrangements designed to provide protection against fluctuations in interest
rates, in each case purchased by a Borrower from a Lender with respect to Loans.
Inventory. All of Borrowers' inventory of whatever name, nature, kind or
description, all goods held for sale or lease or to be furnished under contracts
of service, finished goods, work in process, raw materials, materials used or
consumed by the Borrowers, parts, supplies, all wrapping, packaging,
advertising, labeling, and shipping materials, devices, names and marks, all
contracts, rights and documents relating to any of the foregoing, whether any of
the foregoing be now existing or hereafter arising, wherever located, now owned
or hereafter acquired by Borrowers.
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Investment. As applied to the Borrowers, the purchase or acquisition of any
share of capital stock, partnership interest, evidence of indebtedness or other
equity security of any other Person (including any Subsidiary), any loan,
advance or extension of credit (excluding Accounts Receivable arising in the
ordinary course of business) to, or contribution to the capital of, any other
Person (including any Subsidiary), any real estate held for sale or investment,
any securities or commodities futures contracts held, any other investment in
any other Person (including any other Borrowers or any Subsidiary), and the
making of any commitment or acquisition of any option to make an Investment.
Issuing Bank. BKB.
Lenders. BKB, the other financial institutions listed on Schedule 1
attached hereto and each other Person that may after the date hereof become a
party to this Agreement as a "Lender" hereunder.
Letters of Credit. See Section 2A.l(a).
Letter of Credit Applications. Applications for Letters of Credit in such
form as may be required by the Issuing Bank from time to time which are executed
and delivered by the Borrowers to the Issuing Bank pursuant to Section 2A, as
the same may be amended or supplemented from time to time.
Letter of Credit Fee. See Section 2.6(b).
Letter of Credit Participation. See Section 2A.1(b).
Letter of Credit Sublimit. $3,000,000.
Loan Documents. This Agreement, the Notes, the Letter of Credit
Applications, the Security Documents, the Holding Guaranty, the Intercreditor
Agreements and a Contribution Agreement of even date herewith among the
Borrowers, together with any agreements, instruments or documents executed and
delivered pursuant to or in connection with any of the foregoing.
Loans. The Loans made or to be made by the Lenders to the Borrowers
pursuant to Section II of this Agreement.
Majority Lenders. As of any date, the holders of fifty-one percent (51%) of
the outstanding principal amount of the Notes on such date; and if no such
principal is outstanding, the holders of fifty-one percent (51%) of the total
Commitments.
Maturity Date. December 20, 2003.
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Maximum Drawing Amount. The maximum aggregate amount from time to time that
beneficiaries may draw under outstanding Letters of Credit.
Multiemployer Pension Plan. A Multiemployer Plan that is subject to
Subtitle E of Title IV of ERISA.
Multiemployer Plan. An employee benefit plan that is a Multiemployer Plan
within the meaning of Section 3(37) of ERISA to which a Borrower or any
Affiliate of a Borrower contributes or has been obligated to contribute.
Note Record. Any internal record, including a computer record, maintained
by any Lender with respect to any Loan.
Notes. Any or all of the Revolving Credit Notes.
Notice of Borrowing or Conversion. The notice, substantially in the form of
Exhibit B hereto, to be given by the Borrowers to the Administrative Agent to
request a Loan or to convert an outstanding Loan of one Type into a Loan of
another Type, in accordance with Section 2.3.
Obligations. Any and all obligations of the Borrowers to the Agents, the
Issuing Bank and the Lenders of every kind and description pursuant to or in
connection with the Loan Documents, Eligible Interest Rate Contracts and
Eligible Commodity Contracts purchased by a Borrower from a Lender, direct or
indirect, absolute or contingent, primary or secondary, due or to become due,
now existing or hereafter arising, regardless of how they arise or by what
agreement or instrument, if any, and including obligations to perform acts and
refrain from taking action as well as obligations to pay money.
Offering Memorandum. The definitive Offering Memorandum dated December 14,
1998, for the Senior Notes.
PBGC. The Pension Benefit Guaranty Corporation or any entity succeeding to
any or all of its functions under ERISA.
Pension Plan. Any Plan which is an "employee pension benefit plan" (as
defined in ERISA).
Permitted Encumbrances. See Section 7.3.
Permitted Guarantees. The Guarantees of up to $150,000,000 in principal
amount of the Senior Debt and of up to $30,000,000 in principal amount of the
Hydro Debt of even date herewith made by the Borrowers and Holding, as in effect
and delivered to the Administrative Agent on the date hereof, without any
amendments or modifications thereto.
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Person. Any individual, corporation, partnership, trust, unincorporated
association, limited liability company, business or other legal entity, and any
government or governmental agency or political subdivision thereof.
Plan. Any "employee pension benefit plan" or "employee welfare benefit
plan" (each as defined in ERISA) maintained by the Borrowers or any Affiliate of
a Borrowers.
Prohibited Transaction. Any "prohibited transaction" as defined in ERISA
and Section 4975 of the Code.
Qualified Investments. As applied to the Borrowers and their Subsidiaries,
investments in (i) notes, bonds or other obligations of the United States of
America or any agency thereof that as to principal and interest constitute
direct obligations of or are guaranteed by the United States of America; (ii)
certificates of deposit of any commercial bank incorporated under the laws of
the United States, or any state, territory or commonwealth thereof, of
recognized standing having capital and unimpaired surplus in excess of
$100,000,000 and whose short-term commercial paper rating at the time of
acquisition is at least A- 2 or the equivalent by Standard & Poor's Corporation
or at least P-2 or the equivalent by Moody's Investors Services, Inc. (any such
bank, an "Approved Bank"), which certificates of deposit have maturities of not
more than one year from the date of acquisition; (iii) repurchase obligations
with a term of not more than 31 days for underlying securities of the types
described in clauses (i), (ii) and (iv) of this definition entered into with any
Approved Bank; (iv) commercial paper or finance company paper issued by any
Person incorporated under the laws of the United States, or any state thereof,
and rated at least A-2 or the equivalent by Standard & Poor's Corporation or at
least P-2 or the equivalent by Moody's Investors Services, Inc., and in each
case maturing not more than one year from the date of acquisition; (v)
investments in money market funds that are registered under the Investment
Company Act of 1940, which have net assets of at least $100,000,000 and at least
85% of whose assets consist of investments or other obligations of the type
described in clauses (i) through (iv) above; (vi) advances to employees for
business related expenses to be incurred in the ordinary course of business and
consistent with past practices in an amount not to exceed $50,000 in the
aggregate outstanding at any one time, provided that advances to any single
employee shall not exceed $10,000 in the aggregate, and (vii) stock and other
securities received in settlement of defaulted Accounts Receivable in the
ordinary course of business.
Reimbursement Obligation. The Obligation of the Borrowers to reimburse the
Issuing Bank and the Lenders on account of any drawing under any Letter of
Credit as provided in Section 2A.2.
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Responsible Officer. The chief financial officer of NAC and any other
officer of NAC designated by such chief financial officer to sign Borrowing Base
Reports and Notices of Borrowing or Conversion.
Restricted Payment. Any dividend, distribution, loan, advance, guaranty,
extension of credit or other payment, whether in cash or property to or for the
benefit of any Person who holds an equity interest in GNA, Holding, any of the
Borrowers or any of their Subsidiaries, whether or not such interest is
evidenced by a security.
Revolving Credit Loan. See Section 2.1(a) hereof.
Revolving Credit Notes. See Section 2.2.
S Corporation. A corporation which is an "S corporation" within the meaning
of Section 1361 of the Code, a "qualified subchapter S subsidiary" within the
meaning of Section 1361(b)(3)(B) of the Code or a Person who has elected to be
taxed as a pass-through entity or otherwise ignored for federal income tax
purposes.
Security Agreement. The Security Agreement between the Borrowers and the
Administrative Agent, dated the Closing Date, as amended and in effect from time
to time.
Security Documents. The Security Agreement, collateral assignments of the
Glencore Tolling Agreement and the Hydro Tolling Agreement and an Indemnity
Agreement Regarding Hazardous Materials, each between the Borrowers and the
Administrative Agent and dated as of the Closing Date, in each case as amended
and in effect from time to time, and any additional documents evidencing or
perfecting the Administrative Agent's lien on the Collateral.
Senior Debt. All Indebtedness and other obligations under the Senior Debt
Indenture and the Senior Notes.
Senior Debt Indenture. The Indenture dated as of December 21, 1998 among
GNA, as issuer, the Borrowers and Holding, as guarantors, and U.S. Trust
Company, National Association, as Trustee, pursuant to which GNA issued the
Senior Notes, as in effect on the date hereof, without giving effect to any
amendments, modifications or supplements thereto.
Senior Debt Security Documents. The "Security Agreements" (as such term is
defined in the Senior Debt Indenture), as in effect on the date hereof, without
giving effect to any amendments, modifications or supplements thereto.
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Senior Notes. GNA's First Mortgage Notes due 2006 in the aggregate
principal amount of $150,000,000, as issued, outstanding and in effect on the
date hereof, without giving effect to any amendment, modification or supplement
thereto.
Settlement Date. See Section 2.4(b).
Stores Inventory. Stores and supplies used in the general maintenance of
machinery or equipment (including, without limitation, spare parts, electric
motors and pipes) and fuel oil, now owned or hereafter acquired by any of the
Borrowers, which are used or consumed or held for use in the business of any of
the Borrowers.
Sub S Distribution Amount. For any period when a Borrower or any of its
Subsidiaries is an S Corporation, an amount equal to the maximum amount
sufficient to cover payment of the expected Federal and state income taxes
attributable to the ownership of such Borrower's common equity (or, in the case
of a Subsidiary, attributable to such Borrower's ownership of such Subsidiary's
common equity), based on the highest Federal and state income tax rates that
could be applicable to any holder of such common equity, as determined through
the end of the period in question, provided, however, that in no event shall the
Sub S Distribution Amount for any year exceed the actual amount of Federal and
state income taxes attributable to the ownership of such Borrower's common
equity.
Subsidiary. Any corporation, association, limited liability company, joint
stock company, business trust or other similar organization of which 50% or more
of the ordinary voting power for the election of a majority of the members of
the board of directors or other governing body of such entity is held or
controlled by GNA or any of the Borrowers or a Subsidiary of GNA or any of the
Borrowers; or any other such organization the management of which is directly or
indirectly controlled by GNA or any of the Borrowers or a Subsidiary of GNA or
any of the Borrowers through the exercise of voting power or otherwise; or any
joint venture, whether incorporated or not, or partnership in which GNA or any
of the Borrowers or any Subsidiary of GNA or any of the Borrowers has a 50% or
greater ownership interest.
Tolling Agreement. Any arrangement or agreement whereby any of the
Borrowers accepts goods from any other Person (including an Affiliate) for
processing, manufacturing or other similar arrangements.
Total Commitment. The sum of the Commitments of the Lenders as in effect
from time to time, which as of the Closing Date shall be $75,000,000 and which
may be any lesser amount, including zero, resulting from a termination or
reduction of such amount in accordance with Sections 2.1 and 8.2 hereof.
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Total Outstandings. At any time, the sum of (i) the aggregate outstanding
principal balance of the Loans at the time and (ii) the Maximum Drawing Amount
at the time.
Type. A Eurodollar Loan or a Base Rate Loan.
Voting Stock. With respect to any Person, the capital stock of such Person
having general voting power under ordinary circumstances to elect a least a
majority of the Board of Directors, managers or trustees of such Person
(irrespective of whether or not at the time capital stock of any other class or
classes shall have or might have voting power by reason of the happening of any
contingency).
Year 2000 Compliant. With respect to any Person, all software, embedded
microchips and other processing capabilities and equipment utilized by and
material to the business operations or financial condition of such Person that
are able to interpret and manipulate data involving all calendar dates correctly
and without causing any abnormal ending scenario, including, without limitation,
in the case of dates or time periods occurring or ending after December 31,
1999, the ability to function at least as effectively as in the case of time
periods occurring or ending prior to January 1, 2000.
1.2 Rules of Interpretation.
-----------------------
(a) All terms of an accounting character used herein but not defined
herein shall have the meanings assigned thereto by GAAP. All
calculations for the purposes of Section VI hereof shall be made
in accordance with GAAP.
(b) A reference to any document or agreement shall include such
document or agreement as amended, restated, modified or
supplemented and in effect from time to time in accordance with
its terms and the terms of this Agreement.
(c) The singular includes the plural and the plural includes the
singular.
(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) The words "include", "includes" and "including" are not limiting.
(f) The words "herein", "hereof", "hereunder" and words of like import
shall refer to this Agreement as a whole and not to any particular
section or subdivision of this Agreement.
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(g) All terms not specifically defined herein or by GAAP that are
defined in the Uniform Commercial Code as in effect in The
Commonwealth of Massachusetts, have the meanings assigned to them
in such Uniform Commercial Code.
(h) The term "to the best knowledge of" a Borrower, or any other term
of similar import, means to the actual knowledge of any executive
officer of a Borrower or any employee of a Borrower with
management responsibility for the subject matter as to which a
Borrower's knowledge is relevant.
II.
DESCRIPTION OF CREDIT
---------------------
2.1 Loans.
-----
(a) Revolving Credit Loans. Upon the terms and subject to the
conditions of this Agreement, and in reliance upon the
representations, warranties and covenants of the Borrowers herein,
each of the Lenders agrees, severally and not jointly, to make
revolving credit loans (the "Revolving Credit Loans") to the
Borrowers at NAC's request from time to time from and after the
Closing Date and prior to the Maturity Date, provided that the
Total Outstandings (after giving effect to all requested Revolving
Credit Loans and Letters of Credit) shall not at any time exceed
the lesser of (i) the Borrowing Base and (ii) the Total
Commitment, and provided, further that the sum of the aggregate
principal amount of outstanding Revolving Credit Loans made by
each Lender and all outstanding Letter of Credit Participations of
such Lender shall not at any time (after giving effect to all
requested Revolving Credit Loans and Letters of Credit) exceed
such Lender's Commitment. The Borrowers may borrow, repay, prepay
and reborrow Revolving Credit Loans, up to the limits imposed by
this Section 2.1, from time to time between the Closing Date and
the Maturity Date upon request given by NAC to the Administrative
Agent pursuant to Section 2.3. Each request for a Revolving Credit
Loan or Letter of Credit hereunder shall constitute a
representation and warranty by the Borrowers that the conditions
set forth in Sections 3.1 and 3.2 have been satisfied as of the
date of such request.
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(b) Limitations. No Eurodollar Loan shall be requested or made for
less than a minimum of $1,000,000 in principal amount and in
integral multiples of $100,000 in excess of such minimum amount
and no Base Rate Loan shall be requested or made for less than a
minimum of $50,000 in principal amount. No more than five
Eurodollar Loans may be outstanding at any time.
(c) Conversion of Loans. Upon the terms and subject to the conditions
of this Agreement, the Borrowers may convert all or any part (in
integral multiples of $500,000) of any outstanding Loan of one
Type into a Loan of another Type on any Business Day (which, in
the case of a conversion of an outstanding Eurodollar Loan shall
be the last day of the Interest Period applicable to such
Eurodollar Loan). The Borrowers shall give the Administrative
Agent prior notice of each such conversion (which notice shall be
effective upon receipt) in accordance with Section 2.3.
(d) Termination or Reduction of Commitments. All Commitments shall
terminate on the Maturity Date. Subject to the provisions of
Section 2.7(c) regarding mandatory payments, the Borrowers shall
have the right at any time and from time to time upon seven (7)
days' prior written notice to the Administrative Agent to reduce
by $1,000,000, and in integral multiples of $500,000 if in excess
thereof, the Total Commitment or to terminate entirely the
Lenders' Commitments to make Loans hereunder, whereupon the
Commitments of the Lenders shall be reduced pro rata in accordance
with their respective Commitment Percentages by the aggregate
amount specified in such notice or shall, as the case may be, be
terminated entirely. If, as a result of any such reduction of the
Total Commitment, the Maximum Drawing Amount at the time would
exceed the Total Commitment or the amount of Letters of Credit
permitted to be outstanding under Sections 2.1(a) and 2A.1(a)
hereof, the Borrowers shall, as a condition precedent to any such
reduction, deposit with and pledge to the Administrative Agent for
the benefit of the Lenders and the Issuing Bank cash in an amount
equal to 105% of such excess. If any Letters of Credit would
remain outstanding after the effective date of any such
termination of the Total Commitment, in addition to satisfaction
of all other applicable terms and conditions of this
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Agreement, the Borrowers shall deposit with and pledge to the
Administrative Agent for the benefit of the Lenders and the
Issuing Bank cash in an amount equal to 105% of the Maximum
Drawing Amount at the effective date of such termination. No
reduction or termination of any Commitment may be reinstated.
2.2 The Notes. The Revolving Credit Loans shall be evidenced by separate
promissory notes for each Lender in a principal amount equal to such
Lender's Commitment, each such note to be substantially in the form of
Exhibit A hereto, dated as of the Closing Date and completed with
appropriate insertions (each such note being referred to herein as a
"Revolving Credit Note" and collectively as the "Revolving Credit
Notes"). The Borrowers irrevocably authorize each of the Lenders to
make or cause to be made, at or about the time of the Drawdown Date of
any Revolving Credit Loan or at the time of receipt of any payment of
principal on the Notes, an appropriate notation on its Note Record
reflecting (as the case may be) the making of such Loan or the receipt
of such payment. The outstanding amount of the Loans set forth on the
Note Records shall be prima facie evidence of the principal amount
thereof owing and unpaid to such Lenders, but the failure to record,
or any error in so recording, any such amount on any Lender's Note
Record shall not limit or otherwise affect the obligations of the
Borrowers hereunder or under any Note to make payments of principal of
or interest on any Note when due.
2.3 Notice and Manner of Borrowing or Conversion of Loans.
-----------------------------------------------------
(a) Whenever the Borrowers desire to obtain or continue a Loan
hereunder or convert an outstanding Loan into a Loan of another
Type, NAC shall give the Administrative Agent a written Notice of
Borrowing or Conversion (or a telephonic notice promptly confirmed
by a written Notice of Borrowing or Conversion), which Notice
shall be irrevocable and which must be received no later than 3:00
p.m. Boston time on the date (i) one Business Day before the day
on which the requested Loan is to be made as or converted to a
Base Rate Loan, and (ii) three Business Days before the day on
which the requested Loan is to be made or continued as or
converted to a Eurodollar Loan. Such Notice of Borrowing or
Conversion shall specify (i) the effective date and amount of each
Loan or portion thereof requested to be made, continued or
converted, subject to the limitations
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set forth in Section 2.1, (ii) the interest rate option requested
to be applicable thereto, and (iii) the duration of the applicable
Interest Period, if any (subject to the provisions of the
definition of the term "Interest Period"). If such Notice fails to
specify the interest rate option to be applicable to the requested
Loan, then the Borrowers shall be deemed to have requested a Base
Rate Loan. If the written confirmation of any telephonic
notification differs in any material respect from the action taken
by the Administrative Agent, the records of the Administrative
Agent shall control absent manifest error.
(b) Subject to the provisions of the definition of the term "Interest
Period" herein, the duration of each Interest Period for a
Eurodollar Loan shall be as specified in the applicable Notice of
Borrowing or Conversion. If no Interest Period is specified in a
Notice of Borrowing or Conversion with respect to a requested
Eurodollar Loan, then the Borrowers shall be deemed to have
selected an Interest Period of one month's duration. If the
Administrative Agent receives a Notice of Borrowing or Conversion
after the time specified in subsection (a) above, such Notice
shall not be effective. If the Administrative Agent does not
receive an effective Notice of Borrowing or Conversion with
respect to an outstanding Eurodollar Loan, or if, when such Notice
must be given prior to the end of the Interest Period applicable
to such outstanding Loan, the Borrowers shall have failed to
satisfy any of the conditions hereof, the Borrowers shall be
deemed to have elected to convert such outstanding Loan in whole
into a Base Rate Loan on the last day of the then current Interest
Period with respect thereto.
2.4 Funding of Loans.
----------------
(a) Loans shall be made by the Lenders pro rata in accordance with
their respective Commitment Percentages, provided, however, that
the failure of any Lender to make any Loan shall not relieve any
other Lender of its obligation to lend hereunder (it being
understood, however, that no Lender shall be responsible for the
failure of any other Lender to make any Loan required to be made
by such other Lender).
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(b) Each of the Lenders authorizes the Administrative Agent to advance
all Revolving Credit Loans which are requested by the Borrowers
during any calendar week, subject to the terms and conditions of
this Agreement. On such day or days as the Administrative Agent
shall designate, but at least once per week (each such day being
referred to herein as a "Settlement Date"), whether or not the
Commitments have been terminated, a Default has occurred, the
Obligations have been accelerated or the Administrative Agent is
proceeding to liquidate the Collateral, the Administrative Agent
shall, as promptly as practicable during normal business hours,
effect a wire transfer of immediately available funds to each
Lender of the amount, if any, payable to such Lender, or each
Lender shall transfer to the Administrative Agent sufficient
immediately available federal funds to reimburse the
Administrative Agent for each such Lender's pro rata share of all
Revolving Credit Loans made by the Administrative Agent since the
previous Settlement Date, in each case after taking into account
payments and collections received by the Administrative Agent and
applied to the Revolving Credit Loans, so that after giving effect
to such transfers by the Administrative Agent to the Lenders or by
the Lenders to the Administrative Agent, as the case may be, the
Administrative Agent's Note Record shall correctly reflect each
Lender's pro rata share of outstanding Revolving Credit Loans. All
Revolving Credit Loans made by the Administrative Agent on behalf
of the Lenders (including Revolving Credit Loans representing
unpaid Reimbursement Obligations) shall be, for purposes of
interest income and charges, considered to be Revolving Credit
Loans from such Lenders to the Borrowers and reflected in the Note
Records of the Administrative Agent and the Lenders (as among the
Administrative Agent and the Lenders) at such time as the
Administrative Agent receives from such Lenders funds as provided
in this Section 2.4, and prior to such time such Revolving Credit
Loans shall be considered, for purposes of interest income and
other charges, to be Revolving Credit Loans from the
Administrative Agent and so reflected in the Note Record of the
Administrative Agent.
(c) The Administrative Agent may notify the Lenders of any requested
Loan and of the Drawdown Date thereof and the amount of each
Lender's pro rata
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share of such Loan, and not later than 1:00 p.m. (Boston time) on
the proposed Drawdown Date of such Loan, each Lender will make
available to the Administrative Agent, at its head office, in
immediately available funds, the amount of such Lender's
Commitment Percentage of the amount of such requested Loan. Upon
receipt by the Administrative Agent of such amount, and upon
receipt of the documents required by Section 3 and the
satisfaction of the other conditions set forth therein (to the
extent applicable), the Administrative Agent will make available
to the Borrowers the aggregate amount of such Loan. The
Administrative Agent may, unless notified to the contrary by any
Lender prior to a Drawdown Date, assume that each Lender has made
available to the Administrative Agent on such Drawdown Date the
amount of such Lender's Commitment Percentage of the Loans to be
made on such Drawdown Date, and the Administrative Agent may (but
it shall not be required to), in reliance upon such assumption,
make available to the Borrowers a corresponding amount. If any
Lender makes available to the Administrative Agent such amount on
a date after such Drawdown Date, such Lender shall pay to the
Administrative Agent on demand an amount equal to the product of
(i) the average, computed for the period referred to in clause
(iii) below, of the weighted average interest rate paid by the
Administrative Agent for federal funds acquired by the
Administrative Agent during each day included in such period,
times (ii) the amount of such Lender's Commitment Percentage of
any such Loans times (iii) a fraction, the numerator of which is
the number of days that elapse from and including such Drawdown
Date to the date on which the amount of such Lender's Commitment
Percentage of such Loans shall become immediately available to the
Administrative Agent, and the denominator of which is 365. A
statement of the Administrative Agent submitted to such Lender
with respect to any amounts owing under this paragraph shall be
prima facie evidence of the amount due and owing to the
Administrative Agent by such Lender. If the amount of such
Lender's Commitment Percentage of such Loans is not made available
to the Administrative Agent by such Lender with three (3) Business
Days following such Drawdown Date, the Administrative Agent shall
be entitled to recover such amount from the Borrowers on demand,
with interest thereon at the rate per annum applicable to the
Loans made on such Drawdown Date.
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(d) The failure or refusal of any Lender to make available to the
Administrative Agent at the aforesaid time and place on any
Settlement Date or Drawdown Date the amount of its Commitment
Percentage of any Loans shall not relieve any other Lender from
its several obligation hereunder to make available to the
Administrative Agent the amount of such other Lender's Commitment
Percentage of any Loans.
2.5 Interest Rates and Payments of Interest.
---------------------------------------
(a) Base Rate Loans. Each Loan which is a Base Rate Loan shall bear
interest on the outstanding principal amount thereof at a rate per
annum equal to the Alternate Base Rate plus the Applicable Margin,
which rate shall change contemporaneously with any change in the
Alternate Base Rate or the Applicable Margin, as provided below.
Such interest shall be payable monthly in arrears on the first
Business Day of each month, commencing February 1, 1999.
(b) Eurodollar Loans. Each Loan which is a Eurodollar Loan shall bear
interest on the outstanding principal amount thereof, for each
Interest Period applicable thereto, at a rate per annum equal to
the Eurodollar Rate plus the Applicable Margin, which rate shall
change with any change in the Applicable Margin, as provided
below. Such interest shall be payable for such Interest Period on
the last day thereof and, if such Interest Period is longer than
three months, at intervals of three months after the first day
thereof.
(c) Default Interest. If an Event of Default shall occur, then at the
option of the Administrative Agent or the direction of the
Majority Lenders the unpaid balance of Loans shall bear interest
at an interest rate equal to 2% per annum above the interest rate
applicable to Base Rate Loans in effect on the day such Event of
Default occurs, until such Event of Default is cured or waived.
(d) Applicable Margin. The Applicable Margin and the Interest Coverage
Ratio shall be determined as of the end of each fiscal month based
upon the monthly financial statements to be delivered pursuant to
Section 5.1(b) hereof, and any change in the Applicable Margin
shall be effective upon the earlier of (i) the delivery of such
financial
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statements, and (ii) the date such financial statements were due
to be delivered pursuant to Section 5.1(b). Notwithstanding the
foregoing, during the period from the Closing Date through and
including December 31, 1999, the Applicable Margin shall be fixed
at (i) 2.25% for Eurodollar Loans and Letter of Credit Fees, and
(ii) 0.75% for Base Rate Loans.
(e) Additional Interest. So long as any Lender shall be required under
regulations of the Board of Governors of the Federal Reserve
System (or any other banking authority, domestic or foreign, to
which such Lender is subject) to maintain reserves with respect to
liabilities or assets consisting of or including "Eurocurrency
Liabilities" (as defined in regulations issued from time to time
by such Board of Governors), the Borrowers shall pay to the
Administrative Agent for the account of each such Lender
additional interest on the unpaid principal amount of each
Eurodollar Loan made by such Lender from the date of such Loan
until such principal amount is paid in full, at an interest rate
per annum equal at all times to the remainder (rounded upwards, if
necessary, to the next higher 1/100 of 1%) obtained by subtracting
(i) the Eurodollar Rate for the Interest Period for such
Eurodollar Loan from (ii) the rate obtained by dividing such
Eurodollar Rate by a percentage equal to 100% minus the Eurodollar
Reserve Percentage of such Lender for such Interest Period. Such
additional interest shall be determined by such Lender and
notified to the Borrowers through the Administrative Agent, and
shall be payable on each date on which interest is payable on such
Eurodollar Loan.
2.6 Fees.
----
(a) The Borrowers shall pay to the Administrative Agent for the
benefit of the Lenders a commitment fee (the "Commitment Fee"),
computed on a daily basis and payable quarterly in arrears on the
first Business Day of each calendar quarter, equal to one-half of
one percent (0.50%) per annum of the excess of (i) the Total
Commitment at the time over (ii) the Total Outstandings at the
time.
(b) The Borrowers shall pay to the Administrative Agent for the
benefit of the Lenders a fee (the "Letter of Credit Fee") at a
rate per annum equal to (i) the Maximum Drawing Amount of each
Letter
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of Credit multiplied by (ii) the Applicable Margin. In addition,
the Borrowers shall pay to the Issuing Bank, solely for its own
account, a fee (the "Fronting Fee") at a rate per annum equal to
one-quarter of one percent (0.25%) of the Maximum Drawing Amount
of each Letter of Credit. At the option of the Administrative
Agent or the direction of the Majority Lenders the Letter of
Credit Fees and Fronting Fees payable during the continuance of
any Event of Default shall be equal to two percent (2%) per annum
above the Letter of Credit Fee and Fronting Fee applicable to each
Letter of Credit in effect on the day such Event of Default
occurs, until such Event of Default is cured or waived. Letter of
Credit Fees and Fronting Fees shall be payable quarterly in
arrears on the first Business Day of each calendar quarter.
(c) Without limiting any of the Lenders' other rights hereunder or by
law, if any Loan or any portion thereof or any interest thereon or
any other amount payable hereunder or under any other Loan
Document is not paid within ten Business Days after its due date,
the Borrowers shall pay to the Administrative Agent for the
benefit of the Lenders on demand a late payment charge equal to
2-1/2% of the amount of the payment due.
(d) The Borrowers shall pay to the Administrative Agent, solely for
the account of the Administrative Agent, such other fees as the
Borrowers and the Administrative Agent shall agree.
(e) The Borrowers authorize the Administrative Agent, the Issuing Bank
and the Lenders to charge (no such charge shall be deemed to be a
set-off) to their Note Records or to any deposit account which the
Borrowers may maintain with any of them the interest, fees,
charges, taxes and expenses provided for in this Agreement, the
Security Documents or any other document executed or delivered in
connection herewith.
2.7 Payments and Prepayments of the Loans.
-------------------------------------
(a) On the Maturity Date, the Borrowers shall pay in full the unpaid
principal balance of the Revolving Credit Loans, together with all
unpaid interest thereon and all Fees and other amounts due with
respect thereto.
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(b) Loans that are Eurodollar Loans may be prepaid, without premium or
penalty, on the last day of any Interest Period applicable
thereto, upon three Business Days' notice. Loans that are Base
Rate Loans may be prepaid at any time, without premium or penalty,
upon one Business Day's notice. Any such notice of prepayment
shall be irrevocable. Prepayments of Revolving Credit Loans may be
reborrowed to the extent provided in Section 2.1.
(c) If at any time the Total Outstandings exceed the lesser of (x) the
Borrowing Base and (y) the Total Commitment, the Borrowers shall
immediately pay the amount of any such excess to the
Administrative Agent for application to the Revolving Credit
Loans.
2.8 Method and Allocation of Payments.
---------------------------------
(a) All payments by the Borrowers hereunder and under any of the other
Loan Documents shall be made without set-off or counterclaim and
free and clear of and without deduction for any taxes, levies,
imposts, duties, charges, fees, deductions, withholdings,
compulsory loans, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless
the Borrowers are compelled by law to make such deduction or
withholding. If any such obligation is imposed upon the Borrowers
with respect to any amount payable by it hereunder or under any of
the other Loan Documents, the Borrowers will pay to each Lender
such additional amount in U.S. Dollars as shall be necessary to
enable such Lender to receive the same net amount which such
Lender would have received on such due date had no such obligation
been imposed upon the Borrowers. The Borrowers will deliver
promptly to each Lender certificates or other valid vouchers or
other evidence of payment reasonably satisfactory to the
Administrative Agent for all taxes or other charges deducted from
or paid with respect to payments made by the Borrowers hereunder
or under such other Loan Document. The Lenders may, and the
Borrowers hereby authorize the Lenders to, debit the amount of any
payment not made by such time to the demand deposit accounts of
the Borrowers with the Lenders or to their Note Records.
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(b) All payments of principal of and interest in respect of Loans
shall be made to the Administrative Agent, for the benefit of the
Lenders, pro rata in accordance with their Commitment Percentages,
and payment of any other amounts due hereunder shall be made to
the Administrative Agent for the benefit of the Lenders, pro rata
as their respective interests appear, at the Administrative
Agent's head office or at such other location that the
Administrative Agent may from time to time designate, in each case
in immediately available funds.
(c) If the Commitments shall have been terminated or the Obligations
shall have been declared immediately due and payable pursuant to
Section 8.2, all funds received from or on behalf of the Borrowers
(including as proceeds of Collateral) by any Lender or the Issuing
Bank in respect of Obligations (except funds received by any
Lender as a result of a purchase of a participant interest
pursuant to Section 2.8(d) below) shall be remitted to the
Administrative Agent, and all such funds, together with all other
funds received by the Administrative Agent from or on behalf of
the Borrowers (including proceeds of Collateral) in respect of
Obligations, shall be applied by the Administrative Agent in the
following manner and order: (i) first, to reimburse the
Administrative Agent, the Issuing Bank and the Lenders, in that
order, for any amounts payable pursuant to Sections 11.2 and 11.3
hereof; (ii) second, to the payment of the Fees; (iii) third, to
the payment of interest due on the Loans and the Reimbursement
Obligations; (iv) fourth, to the payment of the outstanding
principal balance of the Loans and the Reimbursement Obligations;
(v) fifth, to the payment of any other Obligations (other than
principal of or interest on the Loans, the Notes and the
Reimbursement Obligations) payable by the Borrowers; and (vi) any
remaining funds shall be paid to whoever shall be entitled thereto
or as a court of competent jurisdiction shall direct.
(d) Each of the Lenders and the Administrative Agent hereby agrees
that if it should receive any amount (whether by voluntary
payment, by realization upon security, by the exercise of the
right of set-off or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Loan Documents,
or otherwise) in respect of principal of, or interest on, the
Loans or any Fees which
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are to be shared pro rata among the Lenders, which, as compared to
the amounts theretofore received by the other Lenders with respect
to such principal, interest or Fees, is in excess of such Lender's
Commitment Percentage of such principal, interest or Fees, such
Lender shall share such excess, less the costs and expenses
(including, reasonable Attorneys' Fees and disbursements) incurred
by such Lender in connection with such realization, exercise,
claim or action, pro rata with all other Lenders in proportion to
their respective Commitment Percentages, and such sharing shall be
deemed a purchase (without recourse) by such sharing party of
participant interests in the Loans or such Fees, as the case may
be, owed to the recipients of such shared payments to the extent
of such shared payments; provided, however, that if all or any
portion of such excess amount is thereafter recovered from such
Lender, such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest.
2.9 Eurodollar Indemnity. If the Borrowers for any reason (including,
without limitation, pursuant to Sections 2.7(c), 2.11 and 8.2 hereof)
make any payment of principal with respect to any Eurodollar Loan on
any day other than the last day of an Interest Period applicable to
such Eurodollar Loan, or fail to borrow or continue or convert to a
Eurodollar Loan after giving a Notice of Borrowing or Conversion
thereof pursuant to Section 2.3, or fail to prepay a Eurodollar Loan
after having given notice thereof, the Borrowers shall pay to the
Administrative Agent for the benefit of the Lenders any amount
required to compensate the Lenders for any additional losses, costs or
expenses which they may reasonably incur as a result of such payment
or failure, including, without limitation, any loss (including loss of
anticipated profits), costs or expense incurred by reason of the
liquidation or re- employment of deposits or other funds required by
the Lenders to fund or maintain such Eurodollar Loan. The Borrowers
shall pay such amount upon presentation by the Administrative Agent of
a statement setting forth the amount and the Administrative Agent's
(or the affected Lenders') calculation thereof pursuant hereto, which
statement shall be deemed true and correct absent manifest error.
2.10 Computation of Interest and Fees. Interest and all Fees payable
hereunder shall be computed daily on the basis of a year of 365 days
for Base Rate Loans and 360
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days for all other Loans and Fees paid for the actual number of days
for which due. If the due date for any payment of principal is
extended by operation of law, interest shall be payable for such
extended time. If any payment required by this Agreement becomes due
on a day that is not a Business Day such payment may be made on the
next succeeding Business Day (subject to the definition of the term
"Interest Period"), and such extension shall be included in computing
interest in connection with such payment.
2.11 Changed Circumstances; Illegality.
---------------------------------
(a) Notwithstanding any other provision of this Agreement, in the
event that:
(i) on any date on which the Eurodollar Rate would otherwise be
set the Administrative Agent shall have determined in good
faith (which determination shall be final and conclusive)
that adequate and fair means do not exist for ascertaining
the Eurodollar Rate, or
(ii) at any time the Administrative Agent or any Lender shall
have determined in good faith (which determination shall be
final and conclusive and, if made by any Lender, shall have
been communicated to the Administrative Agent in writing)
that:
(A) the making or continuation of or conversion of any Loan to a
Eurodollar Loan has been made impracticable or unlawful by (1) the
occurrence of a contingency that materially and adversely affects the
interbank Eurodollar market or (2) compliance by the Administrative Agent
or such Lender in good faith with any applicable law or governmental
regulation, guideline or order or interpretation or change thereof by any
governmental authority charged with the interpretation or administration
thereof or with any request or directive of any such governmental authority
(whether or not having the force of law); or
(B) the Eurodollar Rate shall no longer represent the effective cost
to the Administrative Agent or such Lender for U.S. dollar deposits in the
interbank market for deposits in which it regularly participates;
then, and in any such event, the Administrative Agent shall forthwith so notify
the Borrowers thereof. Until the Administrative Agent notifies the Borrowers
that the circumstances giving rise to such notice no longer apply, the
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obligation of the Lenders to allow selection by the Borrowers of the Type of
Loan affected by the contingencies described in this Section (herein called
"Affected Loans") shall be suspended. If, at the time the Administrative Agent
so notifies the Borrowers, the Borrowers have previously given the
Administrative Agent a Notice of Borrowing or Conversion with respect to one or
more Affected Loans but such Loans have not yet gone into effect, such
notification shall be deemed to be a request for Base Rate Loans.
(b) In the event of a determination of illegality pursuant to
subsection (a)(ii)(A) above, the Borrowers shall, with respect to
the outstanding Affected Loans, prepay the same, together with
interest thereon and any amounts required to be paid pursuant to
Section 2.9, on such date as shall be specified in such notice
(which shall not be earlier than the date such notice is given)
and may, subject to the conditions of this Agreement, borrow a
Loan of another Type in accordance with Section 2.1 hereof by
giving a Notice of Borrowing or Conversion pursuant to Section
2.3 hereof.
2.12 Increased Costs. In case any change in law, regulation, treaty or
official directive or the interpretation or application thereof by any
court or by any governmental authority charged with the administration
thereof or the compliance with any guideline or request of any central
bank or other governmental authority (whether or not having the force
of law):
(i) subjects any Lender to any tax with respect to payments of
principal or interest or any other amounts payable hereunder
by the Borrowers or otherwise with respect to the
transactions contemplated hereby (except for taxes on the
overall net income of such Lender imposed by the United
States of America or any political subdivision thereof), or
(ii) imposes, modifies or deems applicable any deposit insurance,
reserve, special deposit or similar requirement against
assets held by, or deposits in or for the account of, or
loans by, any Lender (other than such requirements as are
already included in the determination of the Eurodollar
Rate), or
(iii) imposes upon any Lender any other condition with respect to
its obligations or
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performance under this Agreement or in respect of any Letter
of Credit,
and the result of any of the foregoing is to increase the cost to the Lender,
reduce the income receivable by such Lender or impose any expense upon such
Lender with respect to any Loans or its obligations under this Agreement or in
respect of any Letter of Credit, such Lender shall notify the Borrowers and the
Administrative Agent thereof. The Borrowers agree to pay to such Lender the
amount of such increase in cost, reduction in income or additional expense as
and when such cost, reduction or expense is incurred or determined, upon
presentation by such Lender of a statement in the amount and setting forth in
reasonable detail such Lender's calculation thereof and the assumptions upon
which such calculation was based, which statement shall be deemed true and
correct absent manifest error.
2.13 Capital Requirements. If after the date hereof any Lender determines
that (i) the adoption of or change in any law, rule, regulation or
guideline regarding capital requirements for banks or bank holding
companies, or any change in the interpretation or application thereof
by any governmental authority charged with the administration thereof,
or (ii) compliance by such Lender or its parent bank holding company
with any guideline, request or directive of any such entity regarding
capital adequacy (whether or not having the force of law), has the
effect of reducing the return on such Lender's or such holding
company's capital as a consequence of such Lender's Commitment to make
Loans hereunder or its obligations in respect of any Letter of Credit
to a level below that which such Lender or such holding company could
have achieved but for such adoption, change or compliance (taking into
consideration such Lender's or such holding company's then existing
policies with respect to capital adequacy and assuming the full
utilization of such entity's capital) by any amount deemed by such
Lender to be material, then such Lender shall notify the Borrowers and
the Administrative Agent thereof. The Borrowers agree to pay to such
Lender the amount of such reduction of return on capital as and when
such reduction is determined, payable within 90 days after
presentation by such Lender of a statement in the amount and setting
forth in reasonable detail such Lender's calculation thereof and the
assumptions upon which such calculation was based (which statement
shall be deemed true and correct absent manifest error) unless within
such 90 day period the Borrowers shall have prepaid in full all
Obligations to such Lender, in which event no amount shall be payable
to such Lender under this Section. In determining such amount, such
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Lender may use any reasonable averaging and attribution methods.
2.14 Borrowers' Representatives. Each Borrower (other than NAC) hereby
appoints NAC as its agent with respect to the receiving and giving of
any notices, requests, instructions, reports, schedules, revisions,
financial statements or any other written or oral communications
hereunder. NAC shall keep complete, correct and accurate records of
all Loans and the application of proceeds thereof, all Letters of
Credit and all payments in respect of Loans and other amounts due
hereunder. NAC shall determine the allocation of proceeds of Loans
among the Borrowers. The Lenders are hereby entitled to rely on any
communication given or transmitted by NAC as if such communication
were given or transmitted by each and every Borrowers; provided,
however, that any communication given or transmitted by any Borrowers
other than NAC shall be binding with respect to such Borrowers. Any
communication given or transmitted by the Administrative Agent, any
Lender or the Issuing Bank to NAC shall be deemed given and
transmitted to each and every Borrower. Notwithstanding the foregoing,
all Obligations of the Borrowers hereunder shall be joint and several.
SECTION IIA
LETTERS OF CREDIT
-----------------
2A.1 Issuance.
--------
(a) Upon the terms and subject to the conditions hereof, the Issuing
Bank, in reliance upon the representations and warranties of the Borrowers
contained herein, agrees to issue letters of credit (the "Letters of Credit")
for the account of the Borrowers in such form as may be requested from time to
time by the Borrowers and agreed to by the Issuing Bank, provided that the
Maximum Drawing Amount (after giving effect to all requested Letters of Credit)
shall not at any time exceed the Letter of Credit Sublimit, provided, further,
that the Total Outstandings (after giving effect to all requested Revolving
Credit Loans and Letters of Credit) shall not at any time exceed the lesser of
(x) the Borrowing Base and (y) the Total Commitment, and provided, further, that
no Letter of Credit shall have an expiration date later than the Maturity Date.
At least three (3) Business Days prior to the proposed issuance date of any
Letter of Credit, the Borrowers shall deliver to the Issuing Bank a Letter of
Credit Application setting forth the Maximum Drawing Amount of all
-35-
Letters of Credit (including the requested Letter of Credit), the requested
language of the requested Letter of Credit and such other information as the
Issuing Bank shall require. Each request for the issuance of a Letter of Credit
hereunder shall constitute a representation and warranty by the Borrowers that
the conditions set forth in Sections 3.1 and 3.2 have been satisfied as of the
date of such request. The Administrative Agent or the Issuing Bank shall notify
the Lenders of the issuance of each Letter of Credit and shall furnish to any
Lender such information with respect thereto as such Lender shall reasonably
request.
(b) Effective upon the issuance of each Letter of Credit in accordance with
the terms hereof, and without any further action on the part of the Issuing Bank
or the Lenders in respect thereof, the Issuing Bank hereby grants to each
Lender, and each Lender hereby acquires from the Issuing Bank, a participating
interest in such Letter of Credit to the extent of such Lender's Commitment
Percentage thereof (the "Letter of Credit Participation"), and each Lender
severally agrees that it shall be absolutely liable, without regard to the
occurrence of any Default or Event of Default, to the extent of such Lender's
Commitment Percentage thereof, to reimburse the Issuing Bank on demand for the
amount of each draft paid by the Issuing Bank under each Letter of Credit to the
extent that such amount is not reimbursed by the Borrowers.
2A.2 Reimbursement Obligation of the Borrowers. In order to induce the
Issuing Bank to issue, extend and renew each Letter of Credit, the Borrowers
hereby agree to reimburse or pay to the Issuing Bank, for the account of the
Issuing Bank or (as the case may be) the Lenders, with respect to each Letter of
Credit issued, extended or renewed by the Issuing Bank hereunder as follows:
(a) on each date that any draft presented under any Letter of Credit is
honored by the Issuing Bank or the Issuing Bank otherwise makes payment with
respect thereto, (i) the amount paid by the Issuing Bank under or with respect
to such Letter of Credit, and (ii) the amount of any taxes, fees, charges or
other costs and expenses whatsoever incurred by the Issuing Bank or any Lender
in connection with any payment made by the Issuing Bank under, or with respect
to, such Letter of Credit; and
(b) upon the Maturity Date or the acceleration of the Reimbursement
Obligations pursuant to Section 8, an amount equal to 105% of the then Maximum
Drawing Amount of all Letters of Credit, which amount (together with all
interest and other earnings thereon) shall be held by the Issuing Bank as cash
collateral for all Reimbursement Obligations.
-36-
Each such payment shall be made to the Issuing Bank at its head office in
immediately available funds. Interest on any and all amounts remaining unpaid by
the Borrowers under this Section 2A.2 at any time from the date such amounts
become due and payable (whether as stated in this Section 2A.2, by acceleration
or otherwise) until payment in full (whether before or after judgment) shall be
payable to the Issuing Bank, for the account of the Issuing Bank or (as the case
may be) the Lenders, on demand at a rate per annum equal to 2% above the
Interest Rate applicable to Base Rate Loans at the time in the absence of an
Event of Default.
2A.3 Letter of Credit Payments. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Issuing Bank
shall notify the Borrowers of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. The responsibility of the Issuing Bank to the
Borrowers shall be only to determine that the documents (including each draft)
delivered under each Letter of Credit in connection with such presentment shall
be in conformity in all material respects with such Letter of Credit. On the
date that such draft is paid or other payment is made by the Issuing Bank, the
Issuing Bank shall promptly notify the Lenders of the amount of any unpaid
Reimbursement Obligation. All such unpaid Reimbursement Obligations with respect
to Letters of Credit shall be deemed to be Revolving Credit Loans. No later than
1:00 p.m. (Boston time) on the Business Day next following the receipt of such
notice, each Lender shall make available to the Administrative Agent, at the
Administrative Agent's head office, in immediately available funds, such
Lender's Commitment Percentage of such unpaid Reimbursement Obligation, together
with an amount equal to the product of (i) the average, computed for the period
referred to in clause (iii) below, of the weighted average interest rate paid by
the Administrative Agent for federal funds acquired by the Administrative Agent
during each day included in such period, times (ii) the amount equal to such
Lender's Commitment Percentage of such unpaid Reimbursement Obligation, times
(iii) a fraction, the numerator of which is the number of days that have elapsed
from and including the date the Issuing Bank paid the draft presented for honor
or otherwise made payment until the date on which such Lender's Commitment
Percentage of such unpaid Reimbursement Obligation shall become immediately
available to the Administrative Agent, and the denominator of which is 365.
2A.4 Obligations Absolute.
--------------------
(a) The Borrowers' Reimbursement Obligations shall be absolute and
unconditional under any and all circumstances and irrespective of the occurrence
of any Default or Event of Default or any condition precedent whatsoever or any
set off,
-37-
counterclaim or defense to payment which the Borrowers may have or have had
against the Issuing Bank, the Administrative Agent, the Lenders or any
beneficiary of a Letter of Credit. The Borrowers further agree that the Issuing
Bank, the Administrative Agent and the Lenders shall not be responsible for, and
the Borrowers' Reimbursement Obligations shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements thereon,
even if such documents should in fact prove to be in any or all respects
invalid, fraudulent or forged, or any dispute between or among the Borrowers,
the beneficiary of any Letter of Credit or any financing institution or other
party to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of the Borrowers, against the beneficiary of any Letter of Credit or
any such transferee.
(b) The Issuing Bank, the Administrative Agent and the Lenders shall
not be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrowers agree that any action taken
or omitted by the Issuing Bank, the Administrative Agent or the Lenders under or
in connection with each Letter of Credit and the related drafts and documents,
if done in good faith, shall be binding upon the Borrowers and shall not result
in any liability on the part of the Issuing Bank, the Administrative Agent or
the Lenders to the Borrowers.
2A.5 Reliance by the Issuing Bank and the Administrative Agent. To the
extent not inconsistent with Section 2A.4, the Issuing Bank and the
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying upon, any Letter of Credit, draft writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons
and upon advice and statements of legal counsel, independent accountants and
other experts selected with reasonable care by the Issuing Bank or the
Administrative Agent.
III.
CONDITIONS OF LOANS AND LETTERS OF CREDIT
-----------------------------------------
3.1 Conditions Precedent to Initial Loans. The obligation of the Lenders
to make the initial Loans and of the Issuing Bank to issue the initial
Letter of Credit is subject to the satisfaction of the following
conditions precedent on or prior to the Closing Date:
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(a) The Administrative Agent shall have received the following
agreements, documents, certificates and opinions in form and
substance reasonably satisfactory to the Administrative Agent and
the Initial Lenders and duly executed and delivered by the
parties thereto:
(i) this Agreement;
(ii) the Notes, substantially in the form of Exhibit A hereto;
(iii) the Security Documents;
(iv) a Contribution Agreement among the Borrowers;
(v) the Holding Guaranty;
(vi) the Intercreditor Agreements;
(vii) complete copies of the Senior Debt Indenture, the Senior
Notes, the Senior Debt Security Documents, the Hydro Debt
Documents and the Permitted Guarantees;
(viii) UCC-1 Financing Statements;
(ix) Certificates of insurance or insurance binders evidencing
compliance with Section 5.3 hereof and the applicable
provisions of the Security Documents;
(x) Borrowing Base Report as of the Closing Date;
(xi) certificates from the chief financial officers of GAC and
NAC with respect to solvency and other matters;
(xii) a certificate of the Secretary or an Assistant Secretary
of each of the Borrowers with respect to resolutions of
the Board of Directors or Managers, as applicable,
authorizing the execution and delivery of the Loan
Documents and identifying the officer(s) or Managers, as
applicable, authorized to execute, deliver and take all
other actions required under this Agreement, and providing
specimen signatures of such officers or Managers, as
applicable;
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(xiii) the Articles or Certificate of Incorporation or Articles
of Organization, as applicable, of each of the Borrowers
and all amendments and supplements thereto, as filed in
the office of the Secretary of State of its jurisdiction
of incorporation, certified by said Secretary of State as
being a true and correct copy thereof;
(xiv) the Bylaws or Operating Agreement, as applicable, of each
of the Borrowers and all amendments and supplements
thereto, certified by the Secretary or an Assistant
Secretary of each of the Borrowers as being a true and
correct copy thereof;
(xv) a certificate of the Secretary of State of each Borrower's
jurisdiction of incorporation or organization as to the
legal existence and status of each of the Borrowers in
such states;
(xvi) an opinion addressed to the Lenders from Stoel Rives LLP,
counsel to the Borrowers; and
(xvii) such other documents, instruments, opinions and
certificates and completion of such other matters, as the
Administrative Agent or any Initial Lender may reasonably
deem necessary or appropriate.
(b) No litigation, arbitration, proceeding or investigation shall be
pending or threatened which questions the validity or legality of
the transactions contemplated by any Loan Document or seeks a
restraining order, injunction or damages in connection therewith,
or which, in the reasonable judgment of the Administrative Agent
or the Initial Lenders, might adversely affect the transactions
contemplated hereby or might have a materially adverse effect on
the assets, business, financial condition or prospects of the
Borrowers, taken as a whole.
(c) All necessary filings and recordings against the Collateral shall
have been completed and the Administrative Agent's liens on the
Collateral
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shall have been perfected, as contemplated by the Security
Documents.
(d) The Borrowers shall have delivered the Initial Financial
Statements to the Initial Lenders.
(e) GNA shall have issued, and received cash proceeds of at least
$145,875,000 from, the Senior Debt on the terms and conditions
described in the Offering Memorandum.
(f) GNA shall have issued, and received cash proceeds of at least
$20,000,000 from, the Hydro Debt on the terms and conditions set
forth in the Hydro Debt Documents.
(g) All Indebtedness of GAC under the Credit Agreement dated May 17,
1996, as amended among GAC, the financial institutions named
therein and BKB as agent, shall have been repaid in full.
(h) All Indebtedness of NAC and NAS under the Credit Agreement dated
May 15, 1996, as amended, among NAC, NAS, the financial
institutions named therein and BKB as agent, shall have been
repaid in full.
(i) The Borrowers shall have paid to the Administrative Agent all
fees to be paid hereunder (including pursuant to Section 2.6(d)
hereof) on or prior to the Closing Date.
3.2 Conditions Precedent to all Loans and Letters of Credit. The
obligation of the Lenders to make any Loan, including the initial
Loans, or continue or convert Loans to Loans of another Type, and of
the Issuing Bank to issue any Letter of Credit, is further subject to
the following conditions:
(a) timely receipt by the Administrative Agent of the Notice of
Borrowing or Conversion and a Borrowing Base Report with respect
to any Loan, or by the Issuing Bank of the Letter of Credit
Application with respect to any Letter of Credit;
(b) the outstanding Loans and Letters of Credit do not and, after
giving effect to any requested Loan or Letter of Credit, will not
exceed the limitations set forth in Sections 2.1 and 2A.1 hereof;
(c) the representations and warranties contained in Section IV shall
be true and accurate in all material respects on and as of the
date of such
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Notice of Borrowing or Conversion or Letter of Credit Application
and on the effective date of the making, continuation or
conversion of each Loan or issuance of each Letter of Credit as
though made at and as of each such date (except to the extent
that such representations and warranties expressly relate to an
earlier date);
(d) no Default or Event of Default shall have occurred and be
continuing at the time of and immediately after (i) the making of
such requested Loan or the issuance of such requested Letter of
Credit, or (ii) the continuation of an outstanding Eurodollar
Loan or the conversion of a Base Rate Loan to a Eurodollar Loan,
unless the Administrative Agent shall have otherwise agreed;
(e) the resolutions referred to in Section 3.1 shall remain in full
force and effect; and
(f) no change shall have occurred in any law or regulation or
interpretation thereof that, in the opinion of counsel for any
Lender, would make it illegal or against the policy of any
governmental agency or authority for such Lender to make Loans
hereunder or, in the opinion of counsel for the Issuing Bank, for
the Issuing Bank to issue Letters of Credit hereunder (as the
case may be).
The making, continuation or conversion of each Loan and the issuance of
each Letter of Credit shall be deemed to be a representation and warranty by the
Borrowers on the date of the making, continuation or conversion of such Loan or
the issuance of such Letter of Credit as to the accuracy of the facts referred
to in subsection (c) of this Section 3.2 and of the satisfaction of all of the
conditions set forth in this Section 3.2.
IV.
REPRESENTATIONS AND WARRANTIES
------------------------------
In order to induce the Administrative Agent, the Issuing Bank and the
Lenders to enter into this Agreement and to make Loans and to issue Letters of
Credit hereunder, the Borrowers represent and warrant to the Administrative
Agent, the Issuing Bank and the Lenders that except as set forth on Exhibit C
attached hereto:
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4.1 Organization; Qualification; Business.
-------------------------------------
(a) Each of the Borrowers (i) is a corporation or limited liability
company duly organized and validly existing under the laws of its
jurisdiction of incorporation or organization, (ii) has all
requisite corporate or other power to own its property and
conduct its business as now conducted and as presently
contemplated and (iii) is duly qualified and in good standing as
a foreign corporation or limited liability company and is duly
authorized to do business in each jurisdiction (all of which are
listed on Exhibit C attached hereto) where the nature of its
properties or business requires such qualification, except where
the failure to be so qualified would not have a material adverse
effect on the business, financial condition, assets or properties
of any of the Borrowers or of the Borrowers taken as a whole.
(b) Since the date of the Initial Financial Statements, the Borrowers
have continued to engage in substantially the same business as
that in which they were then engaged and are not engaged in any
business not reasonably related or ancillary thereto (as
determined in good faith by GNA's Board of Directors).
4.2 Corporate Authority. The execution, delivery and performance of the
Loan Documents and the transactions contemplated thereby are within
the corporate or other power and authority of the Borrowers, have been
authorized by all necessary or other corporate action, and do not and
will not (a) contravene any provision of the Articles or Certificate
of Incorporation, by-laws or operating agreement, as applicable, of
any of the Borrowers or any law, rule or regulation applicable to any
of the Borrowers, (b) contravene any provision of, or constitute an
event of default or event that, but for the requirement that time
elapse or notice be given, or both, would constitute an event of
default under, any other agreement, instrument, order or undertaking
binding on any of the Borrowers, or (c) result in or require the
imposition of any Encumbrance on any of the properties, assets or
rights of any of the Borrowers, except (i) in favor of the
Administrative Agent, the Issuing Bank and the Lenders, and (ii) in
favor of the trustee for the holders of the Senior Debt and in favor
of the holder of the Hydro Debt (or the holders of any Indebtedness
which refinances any of the Senior Debt or the Hydro Debt) in
accordance with the Intercreditor Agreements.
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4.3 Valid Obligations. The Loan Documents and all of their respective
terms and provisions are the legal, valid and binding obligations of
the Borrowers, enforceable in accordance with their respective terms
except as limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and except as the remedy of specific
performance or of injunctive relief is subject to the discretion of
the court before which any proceeding therefor may be brought. The
Security Documents have effectively created in favor of the
Administrative Agent, the Issuing Bank and the Lenders legal, valid
and binding security interests in the Collateral enforceable in
accordance with their terms, and such security interests are fully
perfected first priority security interests, subject only to Permitted
Encumbrances.
4.4 Consents or Approvals. The execution, delivery and performance of the
Loan Documents and the transactions contemplated thereby do not
require any approval or consent of, or filing or registration with,
any governmental or other agency or authority, or any other Person,
except under or as contemplated by the Security Documents, all of
which have been obtained.
4.5 Title to Properties; Absence of Encumbrances. Each of the Borrowers
and their Subsidiaries has good and marketable title to all of the
properties, assets and rights of every name and nature now purported
to be owned by it, including, without limitation, such properties,
assets and rights as are reflected in the Initial Financial Statements
(except such properties, assets or rights as have been disposed of in
the ordinary course of business or as permitted by the terms hereof
since the date thereof), free from all Encumbrances except Permitted
Encumbrances.
4.6 Financial Statements. The Borrowers have furnished to the Lenders the
following financial statements (collectively, the "Initial Financial
Statements"): (i) Holding's unaudited consolidated balance sheet as of
September 30, 1998 and its unaudited consolidated statements of
income, retained earnings and cash flow for the nine months then
ended, certified by the chief financial officer of Holding; (ii) the
unaudited combined balance sheet of NAC and NAS as of September 30,
1998 and their combined statements of income, retained earnings and
cash flow for the fiscal year then ended, certified by the chief
financial officer of NAC; and (iii) the unaudited combined balance
sheets of GNA as of September 30, 1998 and its unaudited combined
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statements of income, shareholders' equity and cash flows for the nine
months then ended, certified by the chief financial officer of GNA.
All such financial statements were prepared in accordance with GAAP
applied on a consistent basis throughout the periods specified and
present fairly the financial position of the Borrowers and their
Subsidiaries as of such dates and the results of the operations of the
Borrowers and their Subsidiaries for such periods, subject, in the
case of unaudited financial statements, to normal recurring year-end
adjustments that shall not in the aggregate be material in amount. The
Borrowers have also furnished to the Lenders their pro forma
consolidated balance sheet as of September 30, 1998 and projections of
their future consolidated results of operations, all of which were
reasonable when made and continue to be reasonable at the date hereof.
At the date hereof, the Borrowers have no Indebtedness or other
material liabilities, debts or obligations, whether accrued, absolute,
contingent or otherwise, and whether due or to become due, including,
but not limited to, liabilities or obligations on account of taxes or
other governmental charges, that are not set forth on the Initial
Financial Statements or on Exhibit C hereto.
4.7 Changes. Since the date of the Initial Financial Statements, there
have been no changes in the assets, liabilities, financial condition,
operations, business or prospects of the Borrowers or any of their
Subsidiaries other than changes in the ordinary course of business and
other changes, in each case the effect of which has not, in the
aggregate, been materially adverse to the Borrowers and their
Subsidiaries taken as a whole.
4.8 Solvency. The Borrowers have and, after giving effect to the Loans and
the Permitted Guarantees, will have, assets (both tangible and
intangible) having a fair saleable value in excess of the amount
required to pay the probable liability on its then-existing debts
(whether matured or unmatured, liquidated or unliquidated, fixed or
contingent); the Borrowers have and will have access to adequate
capital for the conduct of their business and the discharge of their
debts incurred in connection therewith as such debts mature; the
Borrowers were not insolvent immediately prior to the making of the
Loans and the issuance of the Permitted Guarantees, and immediately
after giving effect thereto, the Borrowers will not be insolvent.
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4.9 Defaults. As of the date of this Agreement, no Default exists.
4.10 Taxes. The Borrowers and each Subsidiary have filed all federal, state
and other material tax returns required to be filed, and all taxes,
assessments and other governmental charges due from the Borrowers and
each Subsidiary have been fully paid, except for such taxes,
assessments or charges that are being contested in good faith by
appropriate proceedings and with respect to which (a) adequate
reserves have been established and are being maintained in accordance
with GAAP and (b) no lien which is not a Permitted Encumbrance has
been filed to secure such taxes, assessments or charges. All such
contests at the date hereof are described on Exhibit C hereto. The
Borrowers and their Subsidiaries have not executed any waiver that
would have the effect of extending the applicable statute of
limitations in respect of tax liabilities. The federal and state
income tax returns of the Borrowers and each Subsidiary have not been
audited or otherwise examined by any federal or state taxing
authority. The Borrowers and each Subsidiary have established on their
books reserves adequate for the payment of all federal, state and
other tax liabilities.
4.11 Litigation. There is no litigation, arbitration, proceeding or
investigation pending, or, to the knowledge of the Borrowers' or any
Subsidiary's officers, threatened against the Borrowers or any
Subsidiary that, if adversely determined, may reasonably be expected
to result in a material judgment not fully covered by insurance, may
reasonably be expected to result in a forfeiture of all or any
substantial part of the property of the Borrowers or their
Subsidiaries, or may reasonably be expected to have a material adverse
effect on the assets, business or prospects of the Borrowers and their
Subsidiaries taken as a whole.
4.12 Subsidiaries. Exhibit C sets forth the name, address, jurisdiction of
incorporation and holders of equity interests of the Borrowers and
each Subsidiary and the shares of capital stock of the Borrowers and
each Subsidiary owned by each stockholder. All such equity interests
have been validly issued and are fully paid and nonassessable, and no
rights to subscribe to any additional shares have been granted, and no
options, warrants or similar rights are outstanding.
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4.13 Investment Company Act. Neither the Borrowers nor any of their
Subsidiaries are subject to regulation under the Investment Company
Act of 1940, as amended.
4.14 Compliance. The Borrowers have all necessary permits, approvals,
authorizations, consents, licenses, franchises, registrations and
other rights and privileges (including patents, trademarks, trade
names and copyrights) to allow them to own and operate their business
without any violation of law or the rights of others except to the
extent that any such violation would not have a material adverse
effect on the business, financial condition or operation of the
Borrowers and their Subsidiaries taken as a whole; and the Borrowers
and each Subsidiary are duly authorized, qualified and licensed under
and in compliance with all applicable laws, regulations,
authorizations and orders of public authorities (including, without
limitation, Environmental Laws as provided in Section 4.16), except to
the extent that any such failure to be so authorized, qualified,
licensed or in compliance would not have a material adverse effect on
the business, financial condition or operation of the Borrowers and
their Subsidiaries taken as a whole. The Borrowers and each Subsidiary
have performed all obligations required to be performed by them under,
and are not in default under or in violation of, their Articles or
Certificate of Incorporation, By-Laws or operating agreement or any
agreement, lease, mortgage, note, bond, indenture, license or other
instrument or undertaking to which any of them is a party or by which
any of them or any of their properties are bound, except for
violations none of which, either individually or in the aggregate,
would have any material adverse effect on the business, condition
(financial or otherwise) or assets of the Borrowers and their
Subsidiaries taken as a whole.
4.15 ERISA. The Borrowers and each of their Affiliates are in compliance in
all material respects with ERISA and the provisions of the Code
applicable to the Plans; neither the Borrowers nor any of their
Affiliates have engaged in a Prohibited Transaction which would
subject the Borrowers, any of their Affiliates or any Plan to a
material tax or penalty imposed on a Prohibited Transaction; no Plan
has incurred any "accumulated funding deficiency" (as defined in
Section 302 of ERISA and Section 412 of the Code), whether or not
waived; neither the Borrowers nor any of their Affiliates maintain or
contribute to, or have maintained or contributed to in the past five
years, any Plan that is subject to Title IV of ERISA or Section 4.12
of the Code; and neither the Borrowers nor any of their
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Affiliates have terminated any Plan in a manner which could result in
the imposition of a lien on the property of the Borrowers or any of
their Affiliates. None of the Borrowers or their Affiliates have
contributed, or been obligated to contribute, to any Multiemployer
Pension Plan on or after September 26, 1980.
4.16 Environmental Matters.
---------------------
(a) The Borrowers and each of their Subsidiaries have obtained all
permits, licenses and other authorizations which are required
under all Environmental Laws, except to the extent failure to
have any such permit, license or authorization would not have a
material adverse effect on the business, financial condition or
operations of the Borrowers and their Subsidiaries, taken as a
whole. The Borrowers and each of their Subsidiaries are in
compliance with the terms and conditions of all such permits,
licenses and authorizations, and are also in compliance with all
applicable orders, decrees, judgments and injunctions, issued,
entered, promulgated or approved under any Environmental Law,
except to the extent failure to comply would not have a material
adverse effect on the business, financial condition or operations
of the Borrowers and their Subsidiaries, taken as a whole.
(b) No written notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been
filed, no penalty has been assessed and no investigation or
review is pending or, to the best of the Borrowers' knowledge,
threatened by any governmental or other entity (i) with respect
to any alleged failure by the Borrowers or any of their
Subsidiaries to comply with any Environmental Laws or to have any
permit, license or authorization required by any Environmental
Law in connection with the conduct of its business, or (ii)
regarding the presence of any Hazardous Material at, on or under
any property now or previously owned, leased or used by the
Borrowers or any of their Subsidiaries or, to the best of the
Borrowers' knowledge, any other location to which Hazardous
Materials from such property had been transported or at which
they have been disposed of.
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(c) To the best of the Borrowers' knowledge no material oral or
written notification of a release of a Hazardous Material has
been filed by or on behalf of the Borrowers or any of their
Subsidiaries and no property now or previously owned, leased or
used by the Borrowers or any of their Subsidiaries is listed or
proposed for listing on the National Priorities List under the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, or on any similar state list of sites
requiring investigation or clean-up.
(d) There are no liens or Encumbrances arising under or pursuant to
any Environmental Law on any of the real property or properties
owned, leased or used by the Borrowers or any of their
Subsidiaries and no governmental actions have been taken or, to
the best of the Borrowers' knowledge, are in process which could
subject any of such properties to such liens or Encumbrances.
(e) Neither the Borrowers nor any of their Subsidiaries nor, to the
best knowledge of the Borrowers, any previous owner, tenant,
occupant or user of any property owned, leased or used by the
Borrowers or any of their Subsidiaries have (i) engaged in or
permitted any operations or activities upon or any use or
occupancy of such property, or any portion thereof, for the
handling, manufacture, treatment, storage, use, generation,
release, discharge, refining, dumping or disposal of any
Hazardous Materials on, under, in or about such property, except
to the extent commonly used in day-to-day operations of such
property and in such case only in compliance in all material
respects with all Environmental Laws, or (ii) transported any
Hazardous Materials to, from or across such property except to
the extent commonly used in day-to-day operations of such
property and, in such case, in compliance in all material
respects with all Environmental Laws; nor to the best knowledge
of the Borrowers have any Hazardous Materials migrated from other
properties upon, about or beneath such property, nor, to the best
knowledge of the Borrowers, are any Hazardous Materials presently
constructed, deposited, stored or otherwise located on, under, in
or about such property except to the extent commonly used in
day-to-day operations of such property and, in such case, in
compliance in all material respects with all Environmental Laws.
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4.17 Restrictions on the Borrowers. The Borrowers are not party to or bound
by any contract, agreement or instrument, nor subject to any charter
or other corporate restriction which will, under current or
foreseeable conditions, materially and adversely affect the business,
property, assets, operations or conditions, financial or otherwise, of
the Borrowers or any of their Subsidiaries.
4.18 Labor Relations. There is (i) no unfair labor practice complaint
pending against the Borrowers or any of their Subsidiaries or, to the
best knowledge of the Borrowers, threatened, before the National Labor
Relations Board, and no grievance or arbitration proceeding arising
out of or under any collective bargaining agreement is so pending
against the Borrowers or any of their Subsidiaries or, to the best
knowledge of the Borrowers, threatened, except for such complaints,
grievances and arbitration proceedings which, if adversely decided,
would not have a material and adverse effect on the condition
(financial or otherwise), properties, business or results of
operations of the Borrowers and their Subsidiaries, taken as a whole,
(ii) no strike, labor dispute, slowdown or stoppage pending against
the Borrowers or any of their Subsidiaries or, to the best knowledge
of the Borrowers, threatened against the Borrowers or any of their
Subsidiaries, except for any such labor action as would not have a
material and adverse effect on the condition (financial or otherwise),
properties, business or results of operations of the Borrowers and
their Subsidiaries, taken as a whole and (iii) to the best knowledge
of the Borrowers, no union representation question existing with
respect to the employees of the Borrowers or any of their Subsidiaries
and, to the best knowledge of the Borrowers, no union organizing
activities are taking place, except for any such question or
activities as would not have a material and adverse effect on the
condition (financial or otherwise), properties, business or results of
operations the Borrowers and their Subsidiaries, taken as a whole.
4.19 Margin Rules. The Borrowers do not own or have any present intention
of purchasing or carrying, and no portion of any Loan shall be used
for purchasing or carrying, any "margin security" or "margin stock" as
such terms are used in Regulations G, U or X of the Board of
Governor's of the Federal Reserve System.
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4.20 Disclosure. No representation or warranty made by the Borrowers in any
Loan Document and no document or information furnished to the Lenders
by or on behalf of or at the request of the Borrowers in connection
with any of the transactions contemplated by the Loan Documents
contains any untrue statement of a material fact or omits to state any
material fact necessary in order to make the statements contained
therein not misleading in light of the circumstances in which they are
made.
4.21 Year 2000 Compliance.
--------------------
(a) The Borrowers and their Subsidiaries have (i) undertaken a
detailed inventory, review and assessment of all areas within
their business and operations that could be adversely affected by
the failure of the Borrowers or their Subsidiaries to be Year
2000 Compliant on a timely basis, (ii) developed a detailed plan
and timetable for becoming Year 2000 Compliant on a timely basis,
and (iii) are implementing that plan in accordance with that
timetable in all material respects.
(b) The Borrowers and their Subsidiaries have developed a plan and
timetable for making written inquiry of their key suppliers and
vendors as to whether such persons will be Year 2000 Compliant in
all material respects and are implementing that plan in
accordance with that timetable in all material respects. For
purposes hereof, "key suppliers and vendors" refers to those
suppliers and vendors of the Borrowers and their Subsidiaries
whose business failure or significant disruption would, with
reasonable probability, result in a material adverse change in
the business, properties or financial condition of the Borrowers
and their Subsidiaries taken as a whole.
V.
AFFIRMATIVE COVENANTS
---------------------
The Borrowers covenant that so long as any Loan, Letter of Credit or other
Obligation remains outstanding or the Lenders or the Issuing Bank have any
obligation to lend or to issue any Letter of Credit hereunder:
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5.1 Financial Statements. The Borrowers shall furnish to the Lenders:
--------------------
(a) as soon as available to the Borrowers, but in any event within 90
days after the end of each fiscal year (except, in the case of
the statements required by clause (iii) below for the fiscal year
ended September 30, 1998, on or before January 31, 1999), (i) the
consolidated balance sheet of GNA as of the end of, and related
consolidated statements of income, retained earnings and cash
flows of GNA for, such year, prepared in accordance with GAAP and
audited by the Borrowers' Accountants, together with
consolidating balance sheets and statements of income, retained
earnings and cash flows of GNA and its Subsidiaries for such
year, certified by the chief financial officer of GNA; (ii)
Holding's consolidated balance sheet as of the end of, and
related consolidated statements of income, retained earnings and
cash flow for, such year, prepared in accordance with GAAP and
audited by the Borrowers' Accountants; (iii) a combined balance
sheet of NAC and NAS as of the end of, and the related combined
statements of income, retained earnings and cash flows of NAC and
NAS for, such year, prepared in accordance with GAAP and audited
by the Borrowers' Accountants; and (iv) concurrently with such
financial statements, a copy of the Borrowers' Accountants
management report and a written statement by the Borrowers'
Accountants that, in the making of the audit necessary for their
report and opinion upon such financial statements they have
obtained no knowledge of any Default or, if in the opinion of
such accountants any such Default exists, they shall disclose in
such written statement the nature and status thereof;
(b) as soon as available to the Borrowers, but in any event within 30
days after the end of each month, a consolidated balance sheet of
GNA as of the end of, and related consolidated statements of
income, retained earnings and cash flow of GNA for, the month
then ended and the portion of the year then ended, prepared in
accordance with GAAP and certified by the chief financial officer
of GNA, subject to normal, recurring year-end adjustments that
shall not in the aggregate be material in amount;
(c) as soon as available, but in any event within 5 Business Days
after the end of each week, a
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Borrowing Base Report, together with such other information
regarding Inventory and Accounts Receivable as the Administrative
Agent may require;
(d) at least 60 days prior to the first day of each fiscal year,
GNA's projections and budget for such fiscal year, prepared on a
monthly basis and including consolidated and consolidating
balance sheets and statements of income, retained earnings and
cash flows;
(e) concurrently with the delivery of each annual and quarterly
financial statement pursuant to subsections (a) and (b) of this
Section 5.1, a report in substantially the form of Exhibit D
hereto signed on behalf of the Borrowers by NAC's chief financial
officer;
(f) promptly after the receipt thereof by the Borrowers, copies of
any reports (including any so-called management letters)
submitted to GNA or the Borrowers by independent public
accountants in connection with any annual audit or interim review
of the accounts of the Borrowers made by such accountants;
(g) promptly after the same are delivered to its stockholders or the
Securities and Exchange Commission, copies of all proxy
statements, financial statements and reports as GNA or the
Borrowers shall send to their stockholders or the holders of the
Senior Debt or the Hydro Debt or as GNA or the Borrowers may file
with the Securities and Exchange Commission or any governmental
authority at any time having jurisdiction over GNA, the Borrowers
or their Subsidiaries;
(h) within 25 days after the end of each month through April 30, 1999
and within 15 days after the end of each month thereafter,
information adequate to identify Inventory and Accounts
Receivable in form and substance reasonably satisfactory to the
Administrative Agent, and if requested by the Administrative
Agent, accompanied by pledges or designations of Inventory and
agings or assignments of Accounts Receivable in form and
substance reasonably satisfactory to the Administrative Agent,
which assignments shall give the Administrative Agent full power
to collect, compromise or otherwise deal with the assigned
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Accounts Receivable as the sole owner thereof, subject to the
terms of the Security Documents;
(i) within 30 days after the end of each month, and at any other time
as the Administrative Agent shall reasonably request, information
in form reasonably satisfactory to the Administrative Agent
concerning all transactions during the month (or during such
other period as the Administrative Agent shall specify) in
commodity, currency and other futures contracts or options and in
forward purchases and sales of raw materials, finished goods and
Inventory; and
(j) from time to time, such other financial data and information
about GNA, the Borrowers or their Subsidiaries as the
Administrative Agent or the Lenders may reasonably request.
5.2 Conduct of Business. The Borrowers shall:
-------------------
(a) duly observe and comply in all material respects with all
applicable laws, regulations, decrees, orders, judgments and
valid requirements of any governmental authorities relative to
their corporate existence, rights and franchises, to the conduct
of their business and to their property and assets (including
without limitation all Environmental Laws and ERISA), and shall
maintain and keep in full force and effect and comply with all
licenses and permits necessary in any material respect to the
proper conduct of their business;
(b) maintain their corporate existence and remain or engage
substantially in the same business as that in which they are now
engaged and in no business which is not reasonably related or
ancillary thereto (as determined in good faith by GNA's Board of
Directors).
5.3 Maintenance and Insurance.
-------------------------
(a) The Borrowers shall maintain their properties (including all
Collateral) in good repair, working order and condition as
required for the normal conduct of their business.
(b) The Borrowers shall at all times maintain liability and casualty
insurance on their properties (including all Collateral) with
financially sound and reputable insurers in such amounts and with
such coverages, endorsements,
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deductibles and expiration dates as the officers of the Borrowers
in the exercise of their reasonable business judgment deem to be
adequate, as are customary in the industry for companies of
established reputation engaged in the same or similar business
and owning or operating similar properties and as shall be
reasonably satisfactory to the Administrative Agent. The
Administrative Agent shall be named as loss payee, additional
insured and/or mortgagee under such insurance as the
Administrative Agent shall require from time to time, and the
Borrowers shall provide to the Administrative Agent lender's loss
payable endorsements in form and substance reasonably
satisfactory to the Administrative Agent. In addition, the
Administrative Agent shall be given thirty (30) days advance
notice of any cancellation of insurance. In the event of failure
to provide and maintain insurance as herein provided, the
Administrative Agent may, at its option, provide such insurance
and charge the amount thereof to the Borrowers as a Revolving
Credit Loan. The Borrowers shall furnish to the Administrative
Agent certificates or other evidence satisfactory to the
Administrative Agent of compliance with the foregoing insurance
provisions. The Administrative Agent shall not, by the fact of
approving, disapproving or accepting any such insurance, incur
any liability for the form or legal sufficiency of insurance
contracts, solvency of insurance companies or payment of law
suits, and the Borrowers hereby expressly assume full
responsibility therefor and liability, if any, thereunder.
5.4 Taxes. The Borrowers shall pay or cause to be paid all taxes,
assessments or governmental charges on or against them or any of their
Subsidiaries or their properties on or prior to the time when they
become delinquent, except for any tax, assessment or charge that is
being contested in good faith by appropriate proceedings and with
respect to which adequate reserves have been established and are being
maintained in accordance with GAAP if no Encumbrance (other than a
Permitted Encumbrance) shall have been filed to secure such tax,
assessment or charge.
5.5 Inspection. The Borrowers shall permit the Administrative Agent, any
Lender and their designees, at any reasonable time and at reasonable
intervals of time, and upon reasonable notice (or if a Default shall
have occurred and is continuing, at any time and
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without prior notice), to (i) visit and inspect the properties of GNA
and the Borrowers, (ii) examine and make copies of and take abstracts
from the books and records of GNA and the Borrowers, and (iii) discuss
the affairs, finances and accounts of GNA and the Borrowers with their
appropriate officers, employees and accountants, all at the expense of
the Borrowers. Without limiting the generality of the foregoing, the
Borrowers will permit periodic reviews (as determined by the
Administrative Agent) of the books and records of the Borrowers and
their Subsidiaries to be carried out by the Administrative Agent's
commercial finance examiners. The Borrowers shall also permit the
Administrative Agent to arrange for verification of Accounts
Receivable, under reasonable procedures established by the
Administrative Agent after consultation with NAC, directly with any
account debtors or by other methods.
5.6 Maintenance of Books and Records. The Borrowers and each of their
Subsidiaries shall keep adequate books and records of account in which
true and complete entries will be made reflecting all of their
business and financial transactions in accordance with GAAP and
applicable law. The Borrowers shall at all times keep correct and
accurate records itemizing and describing the kind, type, quality and
quantity of Inventory and of Eligible Inventory, the Borrowers' cost
therefor in accordance with the Borrowers' current procedures as
heretofore described by the Borrowers to the Lenders, and withdrawals
therefrom and additions thereto, all of which records shall be updated
at least monthly (or more frequently if reasonably requested by the
Administrative Agent or, after Default, by any Lender) and shall be
available during the Borrowers' usual business hours at the request of
any of the Administrative Agent's officers, employees or agents.
5.7 Use of Proceeds.
---------------
(a) The Borrowers will use the proceeds of Loans solely to refinance
existing Indebtedness of the Borrowers, for the working capital
needs of the Borrowers, including payment of the costs and
expenses of the transactions contemplated hereby, for permitted
Capital Expenditures and for ongoing general corporate purposes.
(b) No portion of any Loan shall be used for the "purpose of
purchasing or carrying" any "margin stock" or "margin security"
as such terms are used in Regulations G, U and X of the Board of
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Governors of the Federal Reserve System, or otherwise in
violation of such regulations.
5.8 Further Assurances. At any time and from time to time the Borrowers
shall execute and deliver such further documents and take such further
action as may reasonably be requested by the Administrative Agent to
effect the purposes of the Loan Documents.
5.9 Notification Requirements. The Borrowers shall furnish to the
Administrative Agent and the Lenders:
(a) immediately upon becoming aware of the existence of any condition
or event that constitutes a Default, written notice thereof
specifying the nature and duration thereof and the action being
or proposed to be taken with respect thereto;
(b) promptly upon becoming aware of any litigation or of any
investigative proceedings by a governmental agency or authority
commenced or threatened against the Borrowers or any of their
Subsidiaries of which they have notice, in which the amount of
damages claimed (excluding punitive damages) exceeds $5,000,000
or the outcome of which would or could reasonably be expected to
have a materially adverse effect on the assets, business or
prospects of any Borrower alone or the Borrowers and their
Subsidiaries on a consolidated basis, written notice thereof and
the action being or proposed to be taken with respect thereto;
and
(c) promptly after any occurrence or after becoming aware of any
condition affecting the Borrowers which constitutes or could
reasonably expected to constitute a material adverse change in or
which has or could reasonably be expected to have a material
adverse effect on the business, properties or condition
(financial or otherwise) of any Borrower alone or of the
Borrowers, taken as a whole, written notice thereof.
5.10 ERISA Reports. With respect to any Plan, the Borrowers shall, or shall
cause their Affiliates to, furnish to the Administrative Agent and the
Lenders promptly (i) written notice of the occurrence of a "reportable
event" (as defined in Section 4043 of ERISA), excluding any such event
notice of which has been waived by regulation, (ii) a copy of any
request for a waiver of the funding standards or an extension of the
amortization periods required under Section 412 of the Code and
Section 302 of ERISA, (iii) a copy of any
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notice of intent to terminate any Pension Plan, (iv) notice that the
Borrowers or any Affiliate will or may incur any liability to or on
account of a Plan under Sections 4062, 4063, 4064, 4201 or 4204 of
ERISA, (v) a copy of the annual report of each Pension Plan (Form 5500
or comparable form) required to be filed with the IRS and/or the
Department of Labor; (vi) notice of any complete or partial withdrawal
from any Multiemployer Pension Plan, (vii) a copy of any notice with
respect to a Multiemployer Pension Plan that such plan is terminated
or is "insolvent" (as defined in Section 4245 of ERISA), or in
"reorganization" (as defined in Section 4241 of ERISA, and a (viii) a
copy of any assessment of withdrawal liability (or preliminary
estimate thereof following a complete or partial withdrawal by a
Borrower or Affiliate) with respect to a Multiemployer Pension Plan.
Any notice to be provided to the Administrative Agent and the Lenders
under this Section shall include a certificate of the chief financial
officer of the Borrower in question setting forth details as to such
occurrence and the action, if any, which such Borrower or the
Affiliate are required or propose to take, together with any notices
required or proposed to be filed with or by the Borrowers, any
Affiliate, the PBGC, the IRS, the trustee or the plan administrator
with respect thereto. Promptly after the adoption of any Pension Plan,
the Borrowers shall notify the Administrative Agent and the Lenders of
such adoption.
5.11 Loss or Depreciation of Collateral. The Borrowers shall notify the
Administrative Agent and the Lenders promptly of the occurrence at any
time of the following events if, individually or in the aggregate, the
amount involved in connection with such events exceeds $3,000,000: (i)
loss or depreciation in value of Inventory resulting from events other
than changes in the market price for such Inventory and the amount of
the loss or depreciation; (ii) rejection or return of any goods giving
rise to an Eligible Account to the extent such rejection or return is
not in the ordinary course of business; (iii) repossession, loss of or
damage to any goods giving rise to any Eligible Account; (iv) any
request by an account debtor for credit, adjustment, set off or
counterclaim of or with respect to an Eligible Account; (v) any
adjustment by the Borrowers of the amount owing on an Eligible
Account; (vi) any merchandise or other dispute related to Inventory;
(vii) any material delay in the Borrowers' performance of any of their
obligations to any customer if the Borrowers have an Eligible Account
with such customer; (viii) any other material event
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affecting Inventory or Eligible Accounts or the value or amount
thereof, including without limitation any event which would result in
an Eligible Account or Eligible Inventory no longer qualifying as an
Eligible Account or Eligible Inventory. In the event of any loss or
depreciation in the per unit value of Inventory resulting from events
other than changes in the market price for such Inventory and the
amount of such loss or depreciation exceeds 5% of the per unit value
reflected on the most recent Borrowing Base Report delivered to the
Administrative Agent, the Borrowers shall immediately notify the
Administrative Agent and the Lenders of such loss or depreciation and
the amount of Inventory affected thereby.
5.12 Environmental Compliance.
------------------------
(a) The Borrowers and their Subsidiaries will comply in all material
respects with all applicable Environmental Laws in all
jurisdictions in which any of them operates now or in the future,
and the Borrowers and their Subsidiaries will comply in all
material respects with all such Environmental Laws that may in
the future be applicable to the Borrowers' or any Subsidiary's
business, properties and assets.
(b) If the Borrowers or any Subsidiary shall (i) receive notice that
any material violation of any Environmental Law may have been
committed or is about to be committed by the Borrowers or any
Subsidiary, (ii) receive notice that any administrative or
judicial complaint or order has been filed or is about to be
filed against the Borrowers or any Subsidiary alleging a material
violation of any Environmental Law or requiring the Borrowers or
any Subsidiary to take any action in connection with the release
of Hazardous Materials into the environment, (iii) receive any
notice from a federal, state or local government agency or
private party alleging that the Borrowers or any Subsidiary may
be liable or responsible for any material amount of costs
associated with a response to or cleanup of a release of
Hazardous Materials into the environment or any damages caused
thereby, or (iv) become aware of any investigative proceedings by
a governmental agency or authority commenced or threatened
against the Borrowers or any of their Subsidiaries regarding any
potential violation of Environmental Laws or any spill, release,
discharge or disposal of any Hazardous Material,
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the Borrowers shall, within 10 days thereof, notify the
Administrative Agent and the Lenders thereof (together with a
copy of any such notice) and of any action being or proposed to
be taken with respect thereto.
5.13 Year 2000 Compliance. The Borrowers and their Subsidiaries shall be
Year 2000 Compliant on or before June 30, 1999 and at all times
thereafter, and shall so certify to the Administrative Agent in
writing on or before June 30, 1999.
5.14 Tolling Agreements; Commingling.
-------------------------------
(a) The Borrowers shall not permit the Glencore Tolling Agreement to be
amended or terminated prior to its expiration date or the Hydro Toll Conversion
Agreement to expire or to be amended or terminated prior to its expiration date,
in each case without the prior written consent of the Majority Lenders (which
consent shall not be unreasonably withheld or delayed).
(b) No Borrower shall enter into any other Tolling Agreement unless such
Borrower shall have given the Administrative Agent and the Lenders ten (10)
Business Days prior notice of its intention to do so. The Borrowers shall
furnish such information with respect to any Tolling Agreement as the
Administrative Agent or any Lender shall reasonably request.
(c) The Borrowers shall take all steps necessary to preserve, protect and
identify all Inventory and shall not permit any Inventory to be commingled with
any goods to be processed under any Tolling Agreement unless the Administrative
Agent is reasonably satisfied with the Borrowers' program and systems for
preserving, protecting and identifying the Inventory.
VI.
FINANCIAL COVENANTS
-------------------
The Borrowers covenant that so long as any Loan, Letter of Credit or other
Obligation remains outstanding or the Lenders or the Issuing Bank have any
obligation to make any Loan or issue any Letter of Credit hereunder:
6.1 Net Worth. The Borrowers shall at all times during each fiscal year
maintain a Consolidated Net Worth of not less than the greater of (i)
$50,000,000 and (ii) an amount equal to (x) the amount of Consolidated
Net Worth required to be maintained for the preceding fiscal year plus
(y) fifty percent (50%) of Consolidated Net Income for the preceding
fiscal year (for purposes of this clause (y), only positive
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Consolidated Net Income shall be included and any net losses shall be
disregarded).
6.2 Minimum Excess Availability. The Borrowers shall not at any time
permit Total Outstandings to exceed the lesser of (i) the Borrowing
Base minus $15,000,000 and (ii) the Total Commitment.
6.3 Capital Expenditures. The Borrowers shall not make (a) Capital
Expenditures in connection with the Facilities Investment Program in
excess of $75,000,000 in the aggregate, and (b) Capital Expenditures
unrelated to the Facilities Investment Program during any fiscal year
of the Borrowers in excess of the sum of (i) $20,000,000, plus (ii)
100% of the unused portion from the immediately preceding fiscal year
of the amount permitted by clause (b)(i) of this sentence.
VII.
NEGATIVE COVENANTS
The Borrowers covenant that so long as any Loan, Letter of Credit or other
Obligation remains outstanding or the Lenders or the Issuing Bank have any
obligation to make any Loan or to issue any Letter of Credit hereunder:
7.1 Indebtedness. The Borrowers shall not create, incur, assume, guarantee
or be or remain liable with respect to any Indebtedness other than the
following:
(a) Obligations;
(b) Indebtedness existing as of the date of this Agreement and
disclosed on Exhibit C hereto and renewals and refinancings
thereof, but not any increase in the principal amounts thereof;
(c) Indebtedness for Capital Expenditures incurred in the ordinary
course of business and renewals and refinancings thereof,
provided that such Indebtedness (i) is subordinated to
Obligations on terms no less favorable to the Agents, the Lenders
and the Issuing Bank than those applicable to the Hydro Debt and
otherwise reasonably satisfactory to the Administrative Agent and
(ii) does not exceed $15,000,000 in the aggregate at any time
outstanding;
(d) Guarantees permitted under Section 7.2 hereof;
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(e) Indebtedness in respect of Eligible Interest Rate Contracts and
Eligible Commodity Contracts;
(f) Indebtedness in respect of the Borrowers' corporate VISA
accommodations described on Exhibit C attached hereto;
(g) Indebtedness of a Borrower to any other Borrower or to GNA,
provided that any such Indebtedness to GNA is subordinated to
Obligations on terms reasonably satisfactory to the Agent; and
(h) other Indebtedness of the Borrowers incurred in the ordinary
course of business, provided that such other Indebtedness does
not exceed $2,000,000 in the aggregate at any time outstanding.
7.2 Contingent Liabilities. The Borrowers shall not create, incur, assume,
guarantee or be or remain liable with respect to any Guarantees other
than (i) the Permitted Guarantees, (ii) other Guarantees existing on
the date of this Agreement and disclosed on Exhibit C hereto, (iii)
Guarantees resulting from the endorsement of negotiable instruments
for deposit or collection in the ordinary course of business, and (iv)
guarantees of the Indebtedness described in Section 7.1(c) and (e),
provided that such Guarantees are no less favorable to the Borrowers
than the Permitted Guarantee of the Hydro Debt and are otherwise
reasonably satisfactory to the Administrative Agent.
7.3 Encumbrances. The Borrowers shall not create, incur, assume or suffer
to exist any mortgage, pledge, security interest, lien or other charge
or encumbrance of any kind, including the lien or retained security
title of a conditional vendor upon or with respect to any of their
property or assets ("Encumbrances"), or assign or otherwise convey any
right to receive income, including the sale or discount of Accounts
Receivable with or without recourse, except the following ("Permitted
Encumbrances"):
(a) Encumbrances in favor of the Administrative Agent, the Issuing
Bank or any of the Lenders to secure Obligations;
(b) Encumbrances existing as of the date of this Agreement and
disclosed in Exhibit C hereto;
(c) Encumbrances securing Indebtedness for Capital Expenditures to
the extent such Indebtedness is
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permitted by Section 7.1(c), provided that no such Encumbrance
attaches to any Collateral;
(d) liens for taxes, fees, assessments and other governmental charges
to the extent that payment of the same may be postponed or is not
required in accordance with the provisions of Section 5.4;
(e) landlords' and lessors' liens in respect of rent not in default
or liens in respect of pledges or deposits under workmen's
compensation, unemployment insurance, social security laws, or
similar legislation (other than ERISA) or in connection with
appeal and similar bonds incidental to litigation; mechanics',
warehouseman's, laborers' and materialmen's and similar liens, if
the obligations secured by such liens are not then delinquent;
liens securing the performance of bids, tenders, contracts (other
than for the payment of money); and liens securing statutory
obligations or surety, indemnity, performance, or other similar
bonds incidental to the conduct of the Borrowers' or a
Subsidiary's business in the ordinary course and that do not in
the aggregate materially detract from the value of their property
or materially impair the use thereof in the operation of their
business;
(f) judgment liens securing judgments that (i) are not fully covered
by insurance, and (ii) shall not have been in existence for a
period longer than 30 days after the creation thereof or, if a
stay of execution shall have been obtained, for a period longer
than 30 days after the expiration of such stay;
(g) rights of lessors under capital leases to the extent such capital
leases are permitted hereunder;
(h) easements, rights of way, restrictions and other similar charges
or Encumbrances relating to real property and not interfering in
a material way with the ordinary conduct of the Borrowers'
business;
(i) Encumbrances securing the Permitted Guarantees as set forth in
the Senior Debt Security Documents and the Hydro Debt Documents,
provided that no such Encumbrance attaches to any Collateral; and
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(j) liens constituting a renewal, extension or replacement of any
Permitted Encumbrance.
7.4 Merger; Consolidation; Sale or Lease of Assets. No Borrower shall:
----------------------------------------------
(a) liquidate, merge or consolidate into or with any other Person or
entity, except that GAC and Holding may merge or consolidate with
each other, provided that if Holding is the survivor of such
merger or consolidation, Holding shall have become a party to
this Agreement as an additional Borrower hereunder and shall
assume all of GAC's Obligations; or
(b) sell, lease or otherwise dispose of, in a single transaction or
series of related transactions, any material portion of the
assets or property of any Borrower, other than sales of
Inventory, the disposition of scrap, waste and obsolete or
unusable items and sales or trade-ins of used or obsolete
equipment, consistent with past practice.
7.5 Speculative Commodity Transactions. No Borrower shall, at any time,
engage in speculative transactions with respect to commodities.
7.6 Restricted Payments.
-------------------
(a) The Borrowers shall not pay, make, declare or authorize any
Restricted Payment other than:
(i) compensation paid and advances made to employees, officers and
directors in the ordinary course of business and consistent with prudent
business practices;
(ii) dividends payable solely in capital stock;
(iii) cash payments or dividends to the extent required to finance
regularly scheduled payments (but not any mandatory or optional
prepayments) of principal of and interest on the Senior Debt and the Hydro
Debt in the amounts and at the times set forth in the Senior Debt Indenture
and the Hydro Debt Documents, provided that both immediately before and
immediately after giving effect to any such payment no Default shall have
occurred and be continuing;
(iv) cash dividends to finance the redemption of or, after a merger of
Holding and GAC, payments to redeem the Holding Preferred Stock, provided
that (x) the aggregate amount of all such dividends or redemption payments
shall
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not exceed the redemption price for the Holding Preferred Stock specified
in Holding's certificate of incorporation (as in effect on the date hereof,
without giving effect to any amendments, modifications or supplements
thereto) plus any accrued and unpaid dividends on such Holding Preferred
Stock, (y) both immediately before and immediately after giving effect to
any such dividend or redemption payments and any such redemption of the
Holding Preferred Stock no Default shall have occurred and be continuing,
and (z) at least ten (10) days before the making of any such redemption
payment or the declaration of any such dividend, the Borrowers shall have
delivered to the Administrative Agent a certificate of the chief financial
officer of NAC demonstrating on a pro forma basis compliance with the
provisions of Sections 6.1 and 6.2 after the payment of such dividend.
(b) Notwithstanding anything to the contrary contained in Section
7.6(a), (i) from time to time during or following the end of any
fiscal quarter during which a Borrower was an S Corporation, such
Borrower may distribute to its stockholders in cash an amount not
in excess of the Sub S Distribution Amount for the portion of the
fiscal year through the end of such fiscal quarter, minus the
aggregate amount of any such distributions theretofore made in
respect such fiscal year, and (ii) if subsequent to any year
during which a Borrower was an S Corporation any taxing authority
or court of competent jurisdiction shall finally determine that
additional taxes are payable by such Borrower's stockholders in
respect of the income of such Borrower during such year, such
Borrower may distribute to such stockholders in cash an
additional amount sufficient to pay such unpaid taxes and any
interest and penalties thereon; provided, however, that in no
event shall the amount so distributed in respect of any year
exceed the actual amount of Federal and state income taxes (and
any interest and penalties thereon) for such year attributable to
the ownership of such Borrower's common stock. The amount of any
distribution under this Section 7.6(b) shall be verified by the
chief financial officer of GAC in the certificate required under
Section 5.1(e) and in the written statement required of the
Borrowers' Accountants under Section 5.1(a).
7.7 Investments; Purchases of Assets. The Borrowers shall not make or
maintain any Investments or purchase or
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otherwise acquire any material amount of assets other than:
(a) Investments existing on the date hereof as set forth on Exhibit
C;
(b) Qualified Investments;
(c) Capital Expenditures;
(d) purchases of Inventory in the ordinary course of business;
(e) normal trade credit extended in the ordinary course of business
and consistent with prudent business practice;
(f) Eligible Commodity Contracts and Eligible Interest Rate
Contracts; and
(g) Investments permitted by Section 4.09(a) of the Senior Debt
Indenture, provided that both immediately before and immediately
after giving effect to the making of any such Investment, no
Default shall have occurred and be continuing.
7.8 ERISA Compliance. Neither the Borrowers nor any of their Affiliates
nor any Plan shall (i) engage in any Prohibited Transaction which
would have a material adverse effect on the business, financial
condition or operations of the Borrowers and their Subsidiaries taken
as a whole, (ii) incur any "accumulated funding deficiency" (as
defined in Section 412(a) of the Code and Section 302 of ERISA)
whether or not waived which would have a material adverse effect on
the business, financial condition or operations of the Borrowers and
their Subsidiaries taken as a whole, (iii) fail to satisfy any
additional funding requirements set forth in Section 412 of the Code
and Section 302 of ERISA or to make any other contribution required
under the terms of any Pension Plan or any collective bargaining
agreement with respect to a Multiemployer Plan which would have a
material adverse effect on the business, financial condition or
operations of the Borrowers and their Subsidiaries taken as a whole,
(iv) terminate any Pension Plan in a manner which could result in the
imposition of a lien on any property of the Borrowers or any of their
Subsidiaries; or (v) withdraw (in a complete or partial withdrawal
within the meaning of Section 4203 or Section 4205 of ERISA,
respectively) from a Multiemployer Pension Plan if such withdrawal
would have a material adverse effect on the business,
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financial condition or operations of the Borrowers and their
Subsidiaries taken as a whole. Each Plan shall comply in all material
respects with ERISA, except to the extent failure to comply in any
instance would not have a material adverse effect on the business,
financial condition or operations of the Borrowers and their
Subsidiaries taken as a whole.
7.9 Transactions with Affiliates. The Borrowers will not, directly or
indirectly, enter into any purchase, sale, lease or other transaction
with any Affiliate except (i) transactions in the ordinary course of
business on terms that are no less favorable to the Borrowers than
those which might be obtained at the time in a comparable arm's-length
transaction with any Person who is not an Affiliate and (ii)
employment contracts with senior management of the Borrowers entered
into in the ordinary course of business and consistent with prudent
business practices. Notwithstanding the foregoing, the Borrowers will
not, directly or indirectly, pay any management, consulting, overhead,
indemnity, guarantee or other similar fee or charge to any Affiliate.
7.10 Fiscal Year. The Borrowers shall not change their fiscal years without
the prior written consent of the Administrative Agent.
VIII.
DEFAULTS
--------
8.1 Events of Default. There shall be an Event of Default hereunder if any
of the following events occurs:
(a) the Borrowers shall fail to pay any principal of any Loan, any
Reimbursement Obligation or any interest, Fees or other amounts
owing under any Loan Document or in respect of any Obligation
when the same shall become due and payable, whether at maturity,
at any accelerated date of maturity or at any other date fixed
for payment;
(b) the Borrowers shall fail to perform or comply with any term,
covenant or agreement applicable to them contained in Sections
5.1 (except subsection (g) thereof), 5.2(b), 5.3(b), 5.5, 5.7,
5.9(a), 5.11, 5.14(a), 6 and 7 of this Agreement and Section 3.7
of the Security Agreement; or
(c) the Borrowers shall fail to perform any term, covenant or
agreement (other than as specified in subsections 8.1(a) or (b)
hereof) applicable to
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them contained in Sections 5.1(g), 5.2(a), 5.6, 5.8, 5.9(b),
5.9(c), 5.12(a), 5.12(b), 5.14(b) and 5.14(c) of this Agreement
and Sections 3.1, 3.8, 3.9 and 4 of the Security Agreement and
such Default shall continue for 10 days; or
(d) the Borrowers shall fail to perform any term, covenant or
agreement (other than as specified in subsections 8.1(a), (b), or
(c) hereof) applicable to them contained in this Agreement or any
other Loan Document and such Default shall continue for 30 days;
or
(e) any representation or warranty of the Borrowers made in this
Agreement or any other Loan Document or in any certificate,
notice or other writing delivered hereunder or thereunder shall
prove to have been false in any material respect upon the date
when made or deemed to have been made and such breach shall be
material to the Borrowers taken as a whole; or
(f) the Borrowers shall (i) fail to pay when due (after any
applicable period of grace) any amount payable under the Glencore
Tolling Agreement, the Hydro Tolling Agreement, the Senior Debt,
the Hydro Debt or any other Indebtedness (including undrawn,
committed or available amounts and including amounts owing to all
creditors under any combined or syndicated credit arrangement)
exceeding $2,000,000 in principal amount or under any agreement
for the use of real or personal property requiring aggregate
payments in excess of $2,000,000 in any twelve month period, or
(ii) fail to observe or perform (after any applicable notice or
period of grace) any term or covenant of the Glencore Tolling
Agreement or the Hydro Tolling Agreement or any term, covenant or
agreement evidencing or securing the Senior Debt, the Hydro Debt,
the Permitted Guarantees or such other Indebtedness or relating
to such agreement for the use of real or personal property and
the effect of such failure to observe or perform permits the
termination of the Glencore Tolling Agreement or the Hydro
Tolling Agreement, permits the acceleration of the Senior Debt or
the Hydro Debt or, if uncured or unwaived for more than thirty
days, permits the acceleration of such other Indebtedness or the
termination of the Borrowers' right to use such real or personal
property; or
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(g) any of the Borrowers or GNA shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver,
custodian, trustee, liquidator or similar official of itself or
of all or a substantial part of its property, (ii) be generally
not paying its debts as such debts become due, (iii) make a
general assignment for the benefit of its creditors, (iv)
commence a voluntary case under the United States Bankruptcy Code
(as now or hereafter in effect), (v) take any action or commence
any case or proceeding under any law relating to bankruptcy,
insolvency, reorganization, winding-up or composition or
adjustment of debts, or any other law providing for the relief of
debtors, (vi) fail to contest in a timely or appropriate manner,
or acquiesce in writing to, any petition filed against it in an
involuntary case under the United States Bankruptcy Code or other
law, (vii) take any action under the laws of its jurisdiction of
incorporation or organization similar to any of the foregoing, or
(viii) take any corporate action for the purpose of effecting any
of the foregoing; or
(h) a proceeding or case shall be commenced against any of the
Borrowers or GNA, without the application or consent of such
Borrower or GNA, as the case may be, in any court of competent
jurisdiction, seeking (i) the liquidation, reorganization,
dissolution, winding up, or composition or readjustment of its
debts, (ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of it or of all or any substantial part of
its assets, or (iii) similar relief in respect of it, under any
law relating to bankruptcy, insolvency, reorganization,
winding-up or composition or adjustment of debts or any other law
providing for the relief of debtors, and such proceeding or case
shall continue undismissed, or unstayed and in effect, for a
period of 45 days; or an order for relief shall be entered in an
involuntary case under the United States Bankruptcy Code, against
such Borrower or GNA, as the case may be; or action under the
laws of the jurisdiction of incorporation or organization of any
Borrower or GNA similar to any of the foregoing shall be taken
with respect to any Borrower or GNA, as the case may be, and
shall continue unstayed and in effect for a period of 45 days; or
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(i) a judgment or order for the payment of money shall be entered
against the Borrowers by any court, or a warrant of attachment or
execution or similar process shall be issued or levied against
property of the Borrowers that in the aggregate exceeds
$2,000,000 in value, the payment of which is not fully covered by
insurance in excess of any deductibles not exceeding $2,000,000
in the aggregate, and such judgment, order, warrant or process
shall continue undischarged or unstayed for 30 days; or
(j) the Borrowers or any Affiliate shall fail to pay when due any
amount in excess of $2,000,000 that they shall have become liable
to pay to the PBGC or to a Plan under Title IV of ERISA, unless
such liability is being contested in good faith by appropriate
proceedings, the Borrowers or the Affiliate, as the case may be,
have established and are maintaining adequate reserves in
accordance with GAAP and no lien shall have been filed to secure
such liability; or the PBGC shall institute proceedings under
Title IV of ERISA to terminate or to cause a trustee to be
appointed to administer any such Plan or Plans; or a condition
shall exist by reason of which the PBGC would be entitled to
obtain a decree adjudicating that any such Plan or Plans must be
terminated; or
(k) any of the Loan Documents shall be canceled, terminated, revoked
or rescinded otherwise than in accordance with the express terms
thereof or with the express prior written agreement, consent or
approval of the Lenders, or any action at law or in equity or
other legal proceeding to cancel, revoke or rescind any Loan
Document shall be commenced by or on behalf of the Borrowers, or
any court or other governmental or regulatory authority or agency
of competent jurisdiction shall make a determination that, or
shall issue a judgment, order, decree or ruling to the effect
that, any one or more of the Loan Documents is illegal, invalid
or unenforceable in accordance with the terms thereof; or
(l) Brett E. Wilcox is no longer the sole beneficial owner (as to
both voting and dispositive power) of at least 35% of the
outstanding Voting Stock of GNA, or Brett E. Wilcox no longer has
the sole right (not subject to revocation, termination or
expiration) to elect a majority of the Board of Directors of GNA,
or any other Person is the
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beneficial owner (as to either voting or dispositive power) of
35% or more of the Voting Stock of GNA, or a majority of the
members of the Board of Directors of GNA are not Continuing
Directors; or
(m) GNA shall fail to own of record and beneficially, free and clear
of any and all Encumbrances (except Encumbrances securing the
Senior Debt and the Hydro Debt), a majority of the issued and
outstanding Voting Stock of NAC, NAS, NAT, Holding (except for
the Holding Preferred Stock) and, following a merger between
Holding and GAC, the survivor of such merger, and to have the
unfettered ability at all times to approve any matter to be voted
upon by the stockholders of the Borrowers and Holding, subject
only to a voting agreement pertaining only to the election of
Directors of GAC and enabling Holding at all times to designate a
majority of the Board of Directors of GAC; or
(n) Brett E. Wilcox shall fail at any time to be the duly elected and
acting chief executive officer of the Borrowers or there shall be
imposed any material restriction on his right to exercise the
powers and authority of such office and to manage the business of
the Borrowers.
8.2 Remedies. Upon the occurrence of an Event of Default described in
subsections 8.1(g) and (h), immediately and automatically, and upon
the occurrence of any other Event of Default, at any time thereafter
while such Event of Default is continuing, at the option of the
Administrative Agent or the Majority Lenders and upon the
Administrative Agent's declaration:
(a) the obligation of the Lenders to make any further Loans and of
the Issuing Bank to issue any Letters of Credit hereunder and all
Commitments shall terminate;
(b) the unpaid principal amount of the Loans together with accrued
interest, all Reimbursement Obligations and all other Obligations
shall become immediately due and payable without presentment,
demand, protest or further notice of any kind, all of which are
hereby expressly waived; and
(c) the Administrative Agent, the Issuing Bank and the Lenders may
exercise any and all rights they have under this Agreement, the
other Loan Documents or
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at law or in equity, and proceed to protect and enforce their
respective rights by any action at law or in equity or by any
other appropriate proceeding.
No remedy conferred upon the Administrative Agent, the Issuing Bank and the
Lenders in the Loan Documents is intended to be exclusive of any other remedy,
and each and every remedy shall be cumulative and shall be an addition to every
other remedy given hereunder or now or hereafter existing at law or in equity or
by statute or by any other provision of law. Without limiting the generality of
the foregoing or of any of the terms and provisions of any of the Security
Documents, if and when the Administrative Agent exercises remedies under the
Security Documents with respect to Collateral, the Administrative Agent may, in
its sole discretion, determine which items and types of Collateral to dispose of
and in what order and may dispose of Collateral in any order the Administrative
Agent shall select in its sole discretion, and the Borrowers consent to the
foregoing and waive all rights of marshalling with respect to all Collateral.
IX.
ASSIGNMENT AND PARTICIPATION
----------------------------
9.1 Assignment.
----------
(a) Each Lender shall have the right to assign at any time any
portion of its Commitment hereunder and its interests in the risk
relating to any Loans and Letter of Credit Participations in an
amount equal to or greater than $5,000,000 to other Lenders or to
banks or financial institutions reasonably acceptable to the
Administrative Agent (each an "Assignee"), provided that any
Lender which proposes to assign less than its total Commitment
must retain a Commitment of at least $5,000,000, and provided,
further, that if no Default or Event of Default shall have
occurred and be continuing, each Assignee which is not a Lender
or an Affiliate of a Lender (in each case with a domestic lending
office for the purpose of making Loans) or a Federal Reserve Bank
shall be subject to prior approval by the Borrowers (such
approval not to be unreasonably withheld or delayed). Each
Assignee shall execute and deliver to the Administrative Agent
and the Borrowers a counterpart joinder substantially in the form
of Exhibit F hereto and shall pay to the Administrative Agent,
solely for the account of the Administrative Agent, an assignment
fee of $3,500. Upon the execution and delivery of such
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counterpart joinder, (a) such Assignee shall, on the date and to
the extent provided in such counterpart joinder, become a
"Lender" party to this Agreement and the other Loan Documents for
all purposes of this Agreement and the other Loan Documents and
shall have all rights and obligations of a "Lender" with a
Commitment as set forth in such counterpart joinder, and the
transferor Lender shall, on the date and to the extent provided
in such counterpart joinder, be released from its obligations
hereunder and under the other Loan Documents to a corresponding
extent (and, in the case of an assignment covering all of the
remaining portion of an assigning Lender's rights and obligations
under this Agreement, such transferor shall cease to be a party
hereto but shall continue to be entitled to the benefits of
Section 11.3 and to any Fees accrued for its account hereunder
and not yet paid); (b) the assigning Lender, if it holds any
Notes, shall promptly surrender such Notes to the Administrative
Agent for cancellation and delivery to the Borrowers, provided
that if the assigning Lender has retained any Commitment, the
Borrowers shall, on the request of the Administrative Agent,
execute and deliver to the Administrative Agent for delivery to
such assigning Lender new Notes in the amount of the assigning
Lender's retained Commitment; (c) the Borrowers shall issue to
such Assignee Notes in the amount of such Assignee's Commitments
dated the Closing Date or such other date as may be specified by
such Assignee and otherwise completed in substantially the form
of Exhibit A hereto; (d) this Agreement shall be deemed
appropriately amended to reflect (i) the status of such Assignee
as a party hereto and (ii) the status and rights of the Lenders
hereunder; and (e) the Borrowers shall take such action as the
Administrative Agent may reasonably request to perfect any
security interests or mortgages in favor of the Lenders,
including any Assignee which becomes a party to this Agreement.
(b) If the Assignee, or any Participant pursuant to Section 9.2
hereof, is organized under the laws of a jurisdiction other than
the United States or any state thereof, such Assignee shall
execute and deliver to the Borrowers, simultaneously with or
prior to such Assignee's execution and delivery of the
counterpart joinder described above in Section 9.1(a), and such
Participant shall execute and deliver to the Lender granting the
participation,
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a United States Internal Revenue Service Form 4224 or Form 1001
(or any successor form), appropriately completed, wherein such
Assignee or Participant claims entitlement to complete exemption
from United States Federal Withholding Tax on all interest
payments hereunder and all Fees and other charges payable
pursuant to any of the Loan Documents. The Borrowers shall not be
required to pay any increased amount to any Assignee or other
Lender on account of taxes to the extent such taxes would not
have been payable if the Assignee or Participant had furnished
one of the Forms referenced in this Section 9.1(b) unless the
failure to furnish such a Form results from (i) a condition or
event affecting the Borrowers or an act or failure to act of the
Borrowers or (ii) the adoption of or change in any law, rule,
regulation or guideline affecting such Assignee or Participant
occurring (x) after the date on which any such Assignee executes
and delivers the counterpart joinder, or (y) after the date such
Assignee shall otherwise comply with the provisions of Section
9.1(a), or (z) after the date a Participant is granted a
participation.
9.2 Participations. Each Lender shall have the right to grant
participations to one or more banks or other financial institutions in
all or any part of any Loans and Letter of Credit Participations owing
to such Lender and the Notes held by such Lender. Each Lender shall
retain the sole right to approve, without the consent of any
participant, any amendment, modification or waiver of any provision of
the Loan Documents, provided that the documents evidencing any such
participation may provide that, except with the consent of such
participant, such Lender will not consent to (a) the reduction in or
forgiveness of the stated principal of or rate of interest on or
Commitment Fee with respect to the portion of any Loan subject to such
participation, (b) the extension or postponement of any stated date
fixed for payment of principal or interest or Commitment Fee with
respect to the portion of any Loan subject to such participation, (c)
the waiver or reduction of any right to indemnification of such Lender
hereunder, or (d) except as otherwise permitted hereunder, the release
of any Collateral. Notwithstanding the foregoing, no participation
shall operate to increase the Total Commitment hereunder or otherwise
alter the substantive terms of this Agreement. In the event of any
such sale by a Lender of participating interests to a participant,
such Lender's obligations under this Agreement shall remain
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unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of such Notes
for all purposes under this Agreement and the Borrowers and
Administrative Agent shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations
under this Agreement.
X.
THE AGENTS
----------
10.1 Appointment of Agents; Powers and Immunities.
--------------------------------------------
(a) Each Lender and the Issuing Bank hereby irrevocably appoints and
authorizes the Administrative Agent to act as its agent hereunder
and under the other Loan Documents and to execute the Loan
Documents (other than this Agreement) and all other instruments
relating thereto. Each Lender and the Issuing Bank irrevocably
authorizes the Administrative Agent to take such action on behalf
of each of the Lenders and the Issuing Bank and to exercise all
such powers as are expressly delegated to the Administrative
Agent hereunder and in the other Loan Documents and all related
documents, together with such other powers as are reasonably
incidental thereto. The obligations of the Administrative Agent
hereunder are only those expressly set forth herein. The
Administrative Agent shall not have any duties or
responsibilities or any fiduciary relationship with any Lender or
the Issuing Bank except those expressly set forth in this
Agreement.
(b) Each Lender and the Issuing Bank hereby irrevocably appoints the
Documentation Agent as documentation agent hereunder and under
the other Loan Documents and authorizes the Documentation Agent
to take such action on behalf of each of the Lenders and the
Issuing Bank and to exercise all such powers on their behalf as
are expressly delegated to the Documentation Agent by the
Administrative Agent, together with such other powers as are
reasonably incidental thereto. The Documentation Agent shall not
have any duties or responsibilities or any fiduciary relationship
with any Lender or the Issuing Bank except those expressly set
forth in this Agreement.
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(c) Neither the Agents nor any of their directors, officers,
employees or agents shall be responsible for any action taken or
omitted to be taken by any of them hereunder or in connection
herewith, except for their own gross negligence or willful
misconduct. Without limiting the generality of the foregoing,
neither the Agents nor any of their Affiliates shall be
responsible to the Lenders or the Issuing Bank for or have any
duty to ascertain, inquire into or verify: (i) any recitals,
statements, representations or warranties made by the Borrowers
or any of their Subsidiaries or any other Person whether
contained herein or otherwise; (ii) the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement, the other Loan Documents or any other document
referred to or provided for herein or therein; (iii) any failure
by the Borrowers or any other Person to perform its obligations
under any of the Loan Documents; (iv) the satisfaction of any
conditions specified in Section 3 hereof, other than receipt of
the documents, certificates and opinions specified in Section
3.1(a) hereof; (v) the existence, value, collectibility or
adequacy of the Collateral or any part thereof or the validity,
effectiveness, perfection or relative priority of the liens and
security interests of the Lenders and the Issuing Bank therein;
or (vi) the filing, recording, refiling, continuing or re-
recording of any financing statement or other document or
instrument evidencing or relating to the security interests or
liens of the Lenders and the Issuing Bank in the Collateral.
(d) The Agents may employ agents, attorneys and other experts, shall
not be responsible to any Lender or the Issuing Bank for the
negligence or misconduct of any such agents, attorneys or experts
selected by it with reasonable care and shall not be liable to
any Lender or the Issuing Bank for any action taken, omitted to
be taken or suffered in good faith by it in accordance with the
advice of such agents, attorneys and other experts. Each of BKB
and US Bank, in its separate capacity as a Lender, shall have the
same rights and powers under the Loan Documents as any other
Lender and may exercise or refrain from exercising the same as
though it were not an Agent, and each of BKB and US Bank and its
Affiliates may accept deposits from, lend money to and generally
engage in any
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kind of business with the Borrowers as if it were not an Agent.
10.2 Actions by Agents.
-----------------
(a) Each of the Agents shall be fully justified in failing or
refusing to take any action under this Agreement as it reasonably
deems appropriate unless it shall first have received such advice
or concurrence of the Lenders and shall be indemnified to its
reasonable satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Agents shall in
all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any of the Loan Documents in
accordance with a request of the Lenders or the Majority Lenders,
as the case may be, and such request and any action taken or
failure to act pursuant thereto shall be binding upon the Lenders
and all future holders of the Notes. Without limiting the
generality of the foregoing, as among the Agents and the Lenders
(but not for the benefit of the Borrowers), if and when the
Administrative Agent exercises remedies under the Security
Documents with respect to Collateral, the Administrative Agent
will follow the directions, if any, of the Majority Lenders in
determining which items and types of Collateral to dispose of and
in what order.
(b) Whether or not an Event of Default shall have occurred, the
Administrative Agent may from time to time exercise such rights
of the Administrative Agent and the Lenders under the Loan
Documents as it determines may be necessary or desirable to
protect the Collateral and the interests of the Administrative
Agent, the Issuing Bank and the Lenders therein and under the
Loan Documents. In addition, the Administrative Agent may,
without the consent of the Lenders, release Collateral valued by
the Administrative Agent, in its reasonable discretion, of not
more than $1,000,000 in any year.
(c) Neither Agent nor any of its directors, officers, employees or
agents shall incur any liability by acting in reliance on any
notice, consent, certificate, statement or other writing (which
may be a bank wire, telex, facsimile or similar writing) believed
by any of them to be genuine or to be signed by the proper party
or parties.
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10.3 Indemnification. Without limiting the obligations of the Borrowers
hereunder or under any other Loan Document, the Lenders agree to
indemnify the Agents and the Issuing Bank, ratably in accordance with
their respective Commitment Percentages, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever
which may at any time be imposed on, incurred by or asserted against
the Agents or the Issuing Bank in any way relating to or arising out
of this Agreement or any other Loan Document or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or the enforcement of any of the terms
hereof or thereof or of any such other documents; provided, that no
Lender shall be liable for any of the foregoing to the extent they
result from the gross negligence or willful misconduct of an Agent or
the Issuing Bank, as the case may be.
10.4 Reimbursement. Without limiting the provisions of Section 10.3, the
Lenders, the Issuing Bank and the Agents hereby agree that the
Administrative Agent shall not be obliged to make available to any
Person any sum which the Administrative Agent is expecting to receive
for the account of that Person until the Administrative Agent has
determined that it has received that sum. The Administrative Agent
may, however, disburse funds prior to determining that the sums which
the Administrative Agent expects to receive have been finally and
unconditionally paid to the Administrative Agent if the Administrative
Agent wishes to do so. If and to the extent that the Administrative
Agent does disburse funds and it later becomes apparent that the
Administrative Agent did not then receive a payment in an amount equal
to the sum paid out, then any Person to whom the Administrative Agent
made the funds available shall, on demand from the Administrative
Agent refund to the Administrative Agent the sum paid to that Person.
If the Administrative Agent in good faith reasonably concludes that
the distribution of any amount received by it in such capacity
hereunder or under the other Loan Documents might involve it in
liability, it may refrain from making distribution until its right to
make distribution shall have been adjudicated by a court of competent
jurisdiction. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Administrative Agent is to
be repaid, each Person to whom any such distribution shall have been
made shall either repay to the Administrative Agent its proportionate
share of the
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amount so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
10.5 Non-Reliance on Agents and Other Lenders. Each Lender represents that
it has, independently and without reliance on the Agents or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of the financial condition and
affairs of the Borrowers and decision to enter into this Agreement and
the other Loan Documents and agrees that it will, independently and
without reliance upon the Agents or any other Lender, and based on
such documents and information as it shall deem appropriate at the
time, continue to make its own appraisals and decision in taking or
not taking action under this Agreement or any other Loan Document. The
Agents shall not be required to keep informed as to the performance or
observance by the Borrowers of this Agreement, the other Loan
Documents or any other document referred to or provided for herein or
therein or by any other Person of any other agreement or to make
inquiry of, or to inspect the properties or books of, any Person.
Except for notices, reports and other documents and information
expressly required to be furnished to the Lenders by the Agents
hereunder, the Agents shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning any
Person which may come into the possession of any Agent or any of its
affiliates. Each Lender shall have access to all documents relating to
each Agent's performance of its duties hereunder at such Lender's
request. Unless any Lender shall, promptly after obtaining knowledge
thereof, object to any action taken by any Agent hereunder (other than
actions to which the provisions of Section 11.7(b) are applicable and
other than actions which constitute gross negligence or willful
misconduct by any Agent), such Lender shall conclusively be presumed
to have approved the same.
10.6 Resignation or Removal of an Agent. An Agent may resign at any time by
giving 30 days prior written notice thereof to the other Agent, the
Lenders and the Borrowers. Upon any such resignation, the Lenders
shall have the right to appoint a successor Agent which shall be
reasonably acceptable to the Borrowers and shall be a financial
institution having a combined capital and surplus in excess of
$150,000,000. If no successor Agent shall have been so appointed by
the Lenders and shall have accepted such appointment within 30 days
after the retiring Agent's giving of notice of
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resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent which shall be reasonably acceptable to the
Borrowers and shall be a financial institution having a combined
capital and surplus in excess of $150,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring Agent, and
the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the provisions of
this Agreement shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was acting as
Agent.
10.7 Intercreditor Agreements. Each Lender and the Issuing Bank hereby
irrevocably appoints and authorizes the Administrative Agent on their
behalf (i) to execute the Intercreditor Agreements and all other
instruments relating thereto, and (ii) to act under and in accordance
with the terms of the Intercreditor Agreements.
XI.
MISCELLANEOUS
-------------
11.1 Notices. Unless otherwise specified herein, all notices hereunder to
any party hereto shall be in writing and shall be deemed to have been
given when delivered by hand, or when sent by electronic facsimile
transmission or by telex, answer back received, or on the first
Business Day after delivery to any overnight delivery service, freight
pre-paid, or upon receipt if sent by certified or registered mail,
return receipt requested, postage pre-paid, and addressed to such
party at its address indicated below:
If to the Borrowers, at
3313 West Second Street
The Dalles, Oregon 97058
Attention: Brett E. Wilcox and William R. Reid
Facsimile: (541) 298-0800
with copies to:
Ms. Jessie Casswell
Goldendale Aluminum Company
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85 John Day Dam Road
Goldendale, WA 98620
Facsimile: (509) 773-7245
Stoel Rives LLP
900 SW Fifth Avenue, Suite 2300
Portland, Oregon 97204
Attention: Richard C. Josephson, Esq.
Facsimile: (503) 220-2480
If to the Administrative Agent or BKB, at
100 Federal Street
Boston, Massachusetts 02110
Attention: James J. Ward, Director
Facsimile: (617) 434-2309
with a copy to:
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
Attention: William A. Levine, Esq.
Facsimile: (617) 338-2880
If to any other Lender, to its address set forth on Schedule 1 attached
hereto;
or at any other address specified by such party in writing.
11.2 Expenses. Whether or not the transactions contemplated hereby shall be
consummated, the Borrowers jointly and severally promise to reimburse
(a) the Agents, the Issuing Bank and the Initial Lenders for all
reasonable out-of-pocket costs, fees and disbursements (including all
Attorneys' Fees, appraisal and collateral examination fees, due
diligence investigation expenses and syndication expenses) incurred or
expended in connection with the preparation, negotiation, execution,
delivery, filing or recording, or the administration or interpretation
of this Agreement and the other Loan Documents, or the consummation of
the transactions contemplated hereby, or any amendment, modification,
approval, consent or waiver hereof or thereof, and (b) the Agents, the
Issuing Bank and all of the Lenders for all reasonable out-of-pocket
costs, fees and disbursements (including all Attorneys' Fees,
appraisal and collateral examination fees, and collection expenses)
incurred or expended in connection with the enforcement of any
Obligations, the exercise of any remedies under any Loan Documents or
with
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respect to the Collateral or the satisfaction of any Indebtedness of
the Borrowers hereunder or thereunder, or in connection with any
litigation, proceeding or dispute in any way related to the credit
hereunder. The Administrative Agent may include references to GNA and
the Borrowers (and may utilize any logo or other distinctive symbol
associated with GNA or the Borrowers) in connection with any
advertising, promotion or marketing undertaken by the Administrative
Agent. The Borrowers will pay any taxes (including any interest and
penalties in respect thereof), other than the Lenders' federal and
state income taxes, payable on or with respect to the transactions
contemplated by the Loan Documents (the Borrowers hereby agreeing to
indemnify the Agents, the Issuing Bank and the Lenders with respect
thereto). For purposes of this Agreement and the other Loan Documents,
"Attorneys' Fees" shall mean the reasonable fees and disbursements of
attorneys (including all paralegals and other staff employed by such
attorneys and the reasonably allocated costs of internal counsel),
whether incurred at arbitration, trial, on appeal, in a bankruptcy
proceeding or in any other way relating to Obligations, the Loan
Documents and the transactions contemplated thereby, including,
without limitation, as provided in Sections 11.2 and 11.3 hereof;
provided, however, that Attorneys' Fees shall not include any
attorneys' fees incurred by the Agents, the Issuing Bank or any Lender
in any court proceeding (other than a proceeding under or related to
11 U.S.C. ss.101 et. seq.) if (i) such fees were incurred in an action
by such Agent, Issuing Bank, or Lender, on the one hand, or the
Borrowers, on the other hand, against the other such party, and (ii)
Borrowers are the prevailing party in such action.
11.3 Indemnification. The Borrowers agree to indemnify and hold harmless
the Agents, the Issuing Bank and the Lenders, as well as their
respective shareholders, directors, offices, agents, attorneys,
subsidiaries and affiliates, from and against all damages, losses,
settlement payments, obligations, liabilities, claims, suits,
penalties, assessments, citations, directives, demands, judgments,
actions or causes of action, whether statutorily created or under the
common law, all reasonable costs and expenses (including, without
limitation, Attorneys' Fees and reasonable fees and disbursements of
engineers and consultants) and all other liabilities whatsoever
(including, without limitation, liabilities under Environmental Laws)
which shall at any time or times be incurred, suffered, sustained or
required to be paid by any such indemnified Person (except any of the
foregoing which
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result from the gross negligence or willful misconduct of the
indemnified Person) by reason of a claim made against such indemnified
Person on account of or in relation to or any way in connection with
any of the arrangements or transactions contemplated by, associated
with or ancillary to this Agreement, the other Loan Documents or any
other documents executed or delivered in connection herewith or
therewith, all as the same may be amended from time to time, or with
respect to any Letters of Credit, whether or not all or part of the
transactions contemplated by, associated with or ancillary to this
Agreement, any of the other Loan Documents or any such other documents
are ultimately consummated. In any investigation, proceeding or
litigation, or the preparation therefor, the Lenders shall select
their own counsel and, in addition to the foregoing indemnity, the
Borrowers agree to pay promptly the reasonable fees and expenses of
such counsel. In the event of the commencement of any such proceeding
or litigation, the Borrowers shall be entitled to participate in such
proceeding or litigation with counsel of its choice at its own
expense, provided that such counsel shall be reasonably satisfactory
to the Administrative Agent. The Borrowers authorize the Agents, the
Issuing Bank and the Lenders to charge any deposit account or Note
Record which it may maintain with any of them for any of the
foregoing. The covenants of this Section 11.3 shall survive payment or
satisfaction of payment of all amounts owing with respect to the
Notes, any other Loan Document or any other Obligation.
11.4 Survival of Covenants, Etc. Unless otherwise stated herein, all
covenants, agreements, representations and warranties made herein, in
the other Loan Documents or in any documents or other papers delivered
by or on behalf of the Borrowers pursuant hereto shall be deemed to
have been relied upon by the Agents, the Issuing Bank and the Lenders,
notwithstanding any investigation heretofore or hereafter made by any
of them, and shall survive the making by the Lenders of the Loans as
herein contemplated, and shall continue in full force and effect so
long as any Obligation remains outstanding and unpaid or any Lender
has any obligation to make any Loans hereunder or the Issuing Bank has
any obligation to issue any Letter of Credit. All statements contained
in any certificate or other writing delivered by or on behalf of the
Borrowers pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by
the Borrowers hereunder.
-83-
11.5 Set-Off. Regardless of the adequacy of any Collateral or other means
of obtaining repayment of the Obligations, but subject to the
provisions of Section 2.8(d) hereof, any deposits, balances or other
sums credited by or due from the head office of any Lender or any of
its branch offices to the Borrowers may, at any time and from time to
time after the occurrence of a Default hereunder, upon notice to the
Administrative Agent but without notice to the Borrowers or compliance
with any other condition precedent now or hereafter imposed by
statute, rule of law, or otherwise (all of which are hereby expressly
waived) be set off, appropriated, and applied by such Lender against
any and all Obligations of the Borrowers in such manner as the head
office of such Lender or any of its branch offices in its sole
discretion may determine, and the Borrowers hereby grant each such
Lender a continuing security interest in such deposits, balances or
other sums for the payment and performance of all such Obligations.
11.6 No Waivers. No failure or delay by the Administrative Agent, the
Issuing Bank or any Lender in exercising any right, power or privilege
hereunder, under the Notes or under any other Loan Document shall
operate as a waiver thereof; nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. No waiver shall extend to or
affect any Obligation not expressly waived or impair any right
consequent thereon. No course of dealing or omission on the part of
the Administrative Agent, the Issuing Bank or the Lenders in
exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No notice to or demand upon the Borrowers shall
entitle the Borrowers to other or further notice or demand in similar
or other circumstances. The rights and remedies herein and in the
Notes and the other Loan Documents are cumulative and not exclusive of
any rights or remedies otherwise provided by agreement or law.
11.7 Amendments, Waivers, etc.
-------------------------
(a) Neither this Agreement nor the Notes nor any other Loan Document
nor any provision hereof or thereof may be amended, waived,
discharged or terminated except by a written instrument signed by
the Administrative Agent on behalf of the Lenders or by the
Lenders and, with respect to Letters of Credit, the Issuing Bank,
and, in the case of amendments, by the Borrowers.
-84-
(b) Except where this Agreement or any of the other Loan Documents
authorizes or permits the Administrative Agent to act alone and
except as otherwise expressly provided in this Section 11.7(b),
any action to be taken (including the giving of notice) by the
Lenders may be taken, and any consent or approval required or
permitted by this Agreement or any other Loan Document to be
given by the Lenders may be given, and any term of this
Agreement, any other Loan Document or any other instrument,
document or agreement related to this Agreement or the other Loan
Documents or mentioned therein may be amended, and the
performance or observance by any of the Borrowers or any other
Person of any of the terms thereof and any Default or Event of
Default (as defined in any of the above-referenced documents or
instruments) may be waived (either generally or in a particular
instance and either retroactively or prospectively), in each case
only with the written consent of the Majority Lenders; provided,
-------- however, that no such consent or amendment which -------
affects the rights, duties or liabilities of the Administrative
Agent or the Issuing Bank shall be effective without the written
consent of the Administrative Agent or the Issuing Bank,
respectively. Notwithstanding the foregoing, no amendment, waiver
or consent shall do any of the following unless in writing and
signed by ALL of --- the Lenders: (i) increase the Total
Commitment (or subject the Lenders to any additional
obligations), (ii) reduce the principal of or interest on any of
the Notes (including, without limitation, interest on overdue
amounts) or any Fees payable hereunder, (iii) postpone any date
fixed for any payment in respect of principal of or interest
(including, without limitation, interest on overdue amounts) on
the Notes, or any Fees payable hereunder, (iv) change the
definition of "Majority Lenders" or the number of Lenders which
shall be required for the Lenders or any of them to take any
action under the Loan Documents; (v) change the definition of
"Borrowing Base" or "Letter of Credit Sublimit" set forth in
Section 1.1, amend Sections 2.1(a), 2.1(b) or 2A.1(a) or waive
the limitations set forth in Sections 2.1(a), 2.1(b) or 2A.1(a);
(vi) amend this Section 11.7(b); (vii) change the Commitment or
the Commitment Percentage of any Lender, except as permitted
under Section IX hereof; (viii) except as permitted by Section
10.2(b) hereunder, release
-85-
any Collateral; or (ix) amend Sections 2.5 or 2.6 hereof.
11.8 Binding Effect of Agreement. All Obligations shall be the joint and
several obligations of all Borrowers. This Agreement shall be binding
upon and inure to the benefit of the Borrowers, the Agents, the
Issuing Bank, the Lenders and their respective successors and assigns;
provided that the Borrowers may not assign or transfer their rights or
obligations hereunder.
11.9 Captions; Counterparts. The captions in this Agreement are for
convenience of reference only and shall not define or limit the
provisions hereof. This Agreement and any amendment hereof may be
executed in several counterparts and by each party on a separate
counterpart, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one instrument.
In proving this Agreement it shall not be necessary to produce or
account for more than one such counterpart signed by the party against
whom enforcement is sought.
11.10 Entire Agreement, Etc. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions
contemplated hereby.
11.11 Waiver of Jury Trial. THE BORROWERS, THE AGENTS, THE ISSUING BANK AND
THE LENDERS HEREBY WAIVE THEIR RIGHT TO A JURY TRIAL WITH RESPECT TO
ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH
THIS AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY
RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF
SUCH RIGHTS AND OBLIGATIONS. EXCEPT AS PROHIBITED BY LAW, THE
BORROWERS, THE AGENTS, THE ISSUING BANK AND THE LENDERS HEREBY WAIVE
ANY RIGHT THEY MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION
REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY,
PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. THE BORROWERS (a) CERTIFY THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF THE AGENTS, THE ISSUING BANK OR
THE LENDERS HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE AGENTS,
THE ISSUING BANK OR THE LENDERS WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (b) ACKNOWLEDGE
THAT THE AGENTS, THE ISSUING BANK AND THE LENDERS HAVE BEEN INDUCED
TO ENTER INTO THIS AGREEMENT AND
-86-
THE OTHER LOAN DOCUMENTS TO WHICH EACH IS A PARTY BECAUSE OF, AMONG
OTHER THINGS, THE BORROWERS' WAIVERS AND CERTIFICATIONS CONTAINED
HEREIN.
11.12 Governing Law. THIS AGREEMENT IS A CONTRACT UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWERS CONSENT TO THE JURISDICTION OF ANY OF THE FEDERAL OR STATE
COURTS LOCATED IN THE COMMONWEALTH OF MASSACHUSETTS IN CONNECTION
WITH ANY SUIT TO ENFORCE THE RIGHTS OF THE LENDERS UNDER THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. THE BORROWERS
IRREVOCABLY WAIVE ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUCH ACTION BROUGHT IN THE COURTS
REFERRED TO IN THE PRECEDING SENTENCE AND IRREVOCABLY WAIVE AND AGREE
NOT TO PLEAD OR CLAIM IN ANY SUCH ACTION THAT SUCH ACTION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
11.13 Severability. The provisions of this Agreement are severable and if
any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such
invalidity or unenforceability shall affect only such clause or
provision, or part thereof, in such jurisdiction, and shall not in
any manner affect such clause or provision in any other jurisdiction,
or any other clause or provision of this Agreement in any
jurisdiction.
UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY THE
LENDERS AFTER OCTOBER 8, 1989, CONCERNING LOANS AND OTHER CREDIT EXTENSIONS
WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY
BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND
BE SIGNED BY THE LENDERS TO BE ENFORCEABLE.
-87-
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement under seal as of the date first above written.
NORTHWEST ALUMINUM NORTHWEST ALUMINUM COMPANY
TECHNOLOGIES, LLC
By: Golden Northwest Aluminum,
Inc., its Member
By: By:
------------------------------- ------------------------------
Name: Name:
Title: Title:
GOLDENDALE ALUMINUM NORTHWEST ALUMINUM
COMPANY SPECIALTIES, INC.
By: By:
------------------------------- ------------------------------
Name: Name:
Title: Title:
BANKBOSTON, N.A., Individually
and as Administrative Agent
By:
-------------------------------
James J. Ward, Director
U.S. BANK NATIONAL ASSOCIATION,
Individually and as Documentation Agent
By:
-------------------------------
Title:
-88-
SCHEDULE 1
----------
COMMITMENTS OF THE LENDERS
--------------------------
Commitment
Lender Percentage Commitment
- ------ ---------- -----------
BankBoston, N.A. 50% $37,500,000
100 Federal St.
Boston, MA 02110
U.S. Bank National 50% $37,500,000
Association
111 S.W. Fifth Avenue
Suite 400
Portland, OR 97208
---------- -----------
100% $75,000,000
========== ===========
-89-
EXHIBIT A
---------
FORM OF
REVOLVING CREDIT NOTE
---------------------
$ December 21, 1998
-------------
FOR VALUE RECEIVED, the undersigned (the "Borrowers") absolutely and
unconditionally promise to pay to the order of [LENDER] ("Payee") at the head
office of BankBoston, N.A., as Administrative Agent (the "Administrative Agent")
at 100 Federal Street, Boston, Massachusetts 02110:
(a) on the Maturity Date, the principal amount of ___________________
______________________ ($_____________) or, if less, the aggregate unpaid
principal amount of Revolving Credit Loans advanced by the Payee to the
Borrowers pursuant to the Credit Agreement of even date herewith, as amended or
supplemented from time to time (the "Credit Agreement"), by and among the
Borrowers, the Administrative Agent and the Lenders (as defined therein); and
(b) interest on the principal balance hereof from time to time
outstanding from the date hereof through and including the date on which such
principal amount is paid in full, at the times and at the rates provided in the
Credit Agreement.
This Note evidences borrowings under, is subject to the terms and
conditions of and has been issued by the Borrowers in accordance with the terms
of the Credit Agreement and is one of the Revolving Credit Notes referred to
therein. The Payee and any holder hereof is entitled to the benefits and subject
to the conditions of the Credit Agreement and may enforce the agreements of the
Borrowers contained therein, and any holder hereof may exercise the respective
remedies provided for thereby or otherwise available in respect thereof, all in
accordance with the respective terms thereof. This Note is secured by the
Security Documents described in the Credit Agreement.
All capitalized terms used in this Note and not otherwise defined herein
shall have the same meanings herein as in the Credit Agreement.
The Borrowers have the right in certain circumstances and the obligation
under certain other circumstances to repay or prepay the whole or part of the
principal of this Note on the terms and conditions specified in the Credit
Agreement.
-90-
If any Event of Default shall occur, the entire unpaid principal amount of
this Note and all of the unpaid interest accrued thereon may become or be
declared due and payable in the manner and with the effect provided in the
Credit Agreement.
The Borrowers and every endorser and guarantor of this Note or the
obligation represented hereby waive presentment, demand, notice, protest and all
other demands and notice in connection with the delivery, acceptance,
performance, default or enforcement of this Note, assent to any extension or
postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral and to the addition or release
of any other party or Person primarily or secondarily liable.
This Note shall be deemed to take effect as a sealed instrument under the
laws of the Commonwealth of Massachusetts and for all purposes shall be
construed in accordance with such laws (without regard to conflicts of laws
rules).
IN WITNESS WHEREOF, the Borrowers have caused this Note to be signed under
seal by their duly authorized officers as of the day and year first above
written.
NORTHWEST ALUMINUM NORTHWEST ALUMINUM COMPANY
TECHNOLOGIES, LLC NORTHWEST ALUMINUM SPECIALTIES, INC.
GOLDENDALE ALUMINUM COMPANY
By: Golden Northwest Aluminum,
Inc., its Member
By: By:
------------------------------- -------------------------------
Name: Name:
Title: Title:
-91-
EXHIBIT B
---------
BankBoston, N.A., Administrative Agent
100 Federal Street
Boston, MA 02110
Re: Credit Agreement Dated as of December 21, 1998 (the "Agreement")
----------------------------------------------------------------
Ladies and Gentlemen:
Pursuant to Section 2.3 of the Agreement the undersigned hereby confirms
the Borrowers' request made on ____________, 19__ for a [Base Rate] [Eurodollar]
Loan in the amount of $__________________ to be advanced on ___________, 199__.
[The Interest Period applicable to said Loan will be [one] [two] [three]
[six] months.]*
[Said Loan represents a conversion of the [Base Rate] [Eurodollar] Loan in
the same amount made on _____________________.]**
The representations and warranties contained or referred to in Section IV
of the Agreement are true and accurate on and as of the effective date of the
Loan as though made at and as of such date (except to the extent that such
representations and warranties expressly relate to an earlier date); and no
Default or Event of Default has occurred and is continuing or will result from
the Loan.
NORTHWEST ALUMINUM COMPANY
By:
-------------------------------
Title:
- -----------------
Date
* To be inserted in any request for a Eurodollar Loan.
** To be inserted in any request for a conversion.
-92-
EXHIBIT C
---------
[DISCLOSURE]
-93-
EXHIBIT D
---------
REPORT OF CHIEF FINANCIAL OFFICER
NORTHWEST ALUMINUM COMPANY, NORTHWEST ALUMINUM SPECIALTIES, INC., NORTHWEST
ALUMINUM TECHNOLOGIES, LLC and GOLDENDALE ALUMINUM COMPANY (the "Borrowers")
HEREBY CERTIFY that:
This Report is furnished pursuant to Section 5.1(e) of the Credit Agreement
dated as of December 21, 1998 (the "Agreement"). Unless otherwise defined
herein, the terms used in this Report have the meanings given to them in the
Agreement.
As required by Section 5.1(a) and (b) of the Agreement, [combined]
[consolidated] financial statements of the Borrowers for the [year/month] ended
______________________ (the "Financial Statements") prepared in accordance with
GAAP consistently applied accompany this Report. The Financial Statements
present fairly the [combined][consolidated] financial position of the Borrowers
as at the date thereof and the [combined][consolidated] results of operations of
the Borrowers for the period covered thereby (subject only to normal recurring
year-end adjustments).
The figures set forth in Schedule 1 hereto for determining compliance by
the Borrowers with the financial covenants contained in the Agreement are true
and complete as of the date hereof.
The activities of the Borrowers during the period covered by the Financial
Statements have been reviewed by the Chief Financial Officer or by employees or
agents under his immediate supervision. Based on such review, to the best
knowledge and belief of the Chief Financial Officer, and as of the date of this
Report, no Default has occurred.*
Set forth below is a description of any event or occurrence which rendered
the representations and warranties set forth in
-94-
Section 4.16 inaccurate in any material respect during the period covered by
the Financial Statements:
WITNESS my hand this _____ day of _______________.
NORTHWEST ALUMINUM COMPANY
NORTHWEST ALUMINUM SPECIALTIES, INC.
NORTHWEST ALUMINUM SPECIALTIES, LLC
GOLDENDALE ALUMINUM COMPANY
By:
-------------------------------
Title:
- ------------------------
* If a Default has occurred, this paragraph is to be modified with an
appropriate statement as to the nature thereof, the period of existence
thereof and what action the Borrowers have taken, are taking, or propose to
take with respect thereto.
-95-
SCHEDULE 1
to
EXHIBIT D
----------
FINANCIAL COVENANTS
-------------------
-96-
EXHIBIT E
---------
NORTHWEST ALUMINUM COMPANY;
NORTHWEST ALUMINUM SPECIALTIES, INC.
NORTHWEST ALUMINUM SPECIALTIES, LLC
GOLDENDALE ALUMINUM COMPANY
BORROWING BASE REPORT
Period Covered:
-------------------------
-97-
EXHIBIT F
---------
ASSIGNMENT AND JOINDER AGREEMENT
Dated
--------------------------
Reference is made to the Credit Agreement dated as of December 21, 1998 as
amended (the "Credit Agreement") among NORTHWEST ALUMINUM COMPANY, NORTHWEST
ALUMINUM SPECIALTIES, INC., NORTHWEST ALUMINUM TECHNOLOGIES, LLC and GOLDENDALE
ALUMINUM COMPANY (the "Borrowers"), the Lenders (as defined in the Credit
Agreement) and BANKBOSTON, N.A. as Administrative Agent. Terms defined in the
Credit Agreement are used herein with the same meanings.
___________________________________________________ (the "Assignor") and
__________________________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without recourse,
and the Assignee hereby purchases and assumes from the Assignor, a ____%
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement as of the Effective Date (as defined below). As a result of such
assignment, the Commitment Percentage of the Assignor shall be _____%, the
Commitment of the Assignor shall be $__________, the Commitment Percentage of
the Assignee shall be _____% and the Commitment of the Assignee shall be
$_____________. Concurrently herewith, the Assignee is remitting to the
Assignor, in federal funds, the amount of its participation in each such
outstanding Loan.
2. The Assignor (i) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto, other
than that the Assignor is the legal and beneficial owner of the interest being
assigned by it hereunder and that such interest is free and clear of any adverse
claim, and (ii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrowers or the
performance or observation by the Borrowers of any of their obligations under
the Credit Agreement or any other instrument or document furnished pursuant
thereto.
-98-
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of such financial statements and other documents
and information as it has deemed necessary to make its own credit analysis and
decision to enter into this Agreement; (ii) agrees that it will, independently
and without reliance upon the Administrative Agent, the Assignor or any other
Person 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 the Loan Agreement; (iii) appoints and authorizes the
Administrative Agent to take such action as Administrative Agent on its behalf
and to exercise such powers under the Credit Agreement as are delegated to the
Administrative Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; and (iv) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it.
4. The Effective Date of this Agreement shall be ______________________
(the "Effective Date").
5. From and after the Effective Date, (i) the Assignee shall be a party to
the Credit Agreement and, to the extent rights and obligations have been
transferred to it by this Agreement, shall have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent its rights and
obligations have been transferred to the Assignee by this Agreement, relinquish
its rights and be released from its obligations under the Credit Agreement. If
the Assignor is holding any Notes, the Assignor shall, promptly after the
Effective Date, surrender such Notes to the Administrative Agent and the
Administrative Agent shall cause the Borrowers to issue new Notes in accordance
with Section 9.1 of the Credit Agreement.
6. From and after the Effective Date, the Administrative Agent shall hold
in trust all payments it receives in respect of the interest assigned hereby and
shall promptly remit such payments to the Assignee.
7. This Assignment and Joinder Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of Massachusetts
(without regard to conflicts of laws rules).
-99-
[Other provisions negotiated between the Assignor and the Assignee
may be added to this Assignment, provided that such provisions are
not inconsistent with the Credit Agreement]
[NAME OF ASSIGNOR]
By:
-------------------------------
Title
[NAME OF ASSIGNEE]
By:
-------------------------------
Title:
-100-
AGREEMENT AND AMENDMENT NO. 1
THIS AGREEMENT AND AMENDMENT NO. 1 (this "Consent") is made as of January
21, 1999, by and among NORTHWEST ALUMINUM COMPANY, NORTHWEST ALUMINUM
SPECIALTIES, INC., GOLDENDALE ALUMINUM COMPANY ("GAC"), NORTHWEST ALUMINUM
TECHNOLOGIES, LLC, BANKBOSTON, N.A., individually, as Administrative Agent and
U.S. BANK NATIONAL ASSOCIATION, individually and as Documentation Agent.
WHEREAS, the parties hereto are parties to a certain Credit Agreement,
dated as of December 21, 1998 (the "Credit Agreement"; terms defined in the
Credit Agreement are used herein with the same meanings);
WHEREAS, the Borrowers plan from time to time to enter into certain
interest rate swap agreements and other agreements or arrangements designed to
provide them with protection against fluctuations in interest rates, and such
arrangements may not be related to Loans; and
WHEREAS, the Borrowers have requested that the Credit Agreement be amended
to allow for such interest rate swap agreements and arrangements;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. Amendment to Section 1.1. The definition of the term "Interest Rate
Contracts" set forth in Section 1.1 of the Credit Agreement is hereby amended to
read in its entirety as follows:
"Interest Rate Contracts. Interest rate swap agreements,
interest rate collar agreements, options on any of the
foregoing and any other agreements or arrangements designed
to provide protection against fluctuations in interest
rates, in each case purchased by a Borrower from a Lender."
2. Representations. The Borrowers represent and warrant to the Agent, the
Lenders and the Issuing Bank as follows:
(a) No Default has occurred and is continuing on the date hereof;
(b) The representations and warranties contained in Section IV of the
Credit Agreement are true and correct in all material respects on and as of the
date hereof (except to the extent that such representations and warranties
expressly relate to an earlier date); and
(c) The resolutions referred to in Section 3.1 of the Credit Agreement
remain in full force and effect.
3. General. The Loan Documents are ratified and confirmed and shall
continue in full force and effect as amended hereby. This Agreement and
Amendment No. 1 may be executed in any number of counterparts with the same
effect as if the signatures hereto and thereto were upon the same instrument.
-2-
WITNESS the execution of this Agreement and Amendment No. 1 as a sealed
instrument as of the date first set forth above.
NORTHWEST ALUMINUM COMPANY NORTHWEST ALUMINUM
SPECIALTIES, INC.
By: By:
------------------------------- --------------------------------
Title: Title:
NORTHWEST ALUMINUM
TECHNOLOGIES, LLC
GOLDENDALE ALUMINUM COMPANY By: Golden Northwest Aluminum,
Inc., its Member
By: By:
------------------------------- --------------------------------
Title: Title:
BANKBOSTON, N.A., U.S. BANK NATIONAL
individually and as ASSOCIATION, individually and
Administrative Agent as Documentation Agent
By: By:
------------------------------- --------------------------------
Title: Title:
-3-