EXHIBIT 10(a)
$450,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
February 26, 1999
among
THE VALSPAR CORPORATION,
ENGINEERED POLYMER SOLUTIONS, INC.,
THE VALSPAR (UK) HOLDING CORPORATION LTD.,
THE VALSPAR (SWITZERLAND) HOLDING CORPORATION A.G.,
FORTON B.V.
and
DYFLEX B.V.
The Banks Listed Herein,
CHASE SECURITIES INC.,
as Syndication Agent,
and
WACHOVIA BANK, N.A.,
as Administrative Agent
and Documentation Agent
TABLE OF CONTENTS
AMENDED AND RESTATED CREDIT AGREEMENT
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions......................................................1
SECTION 1.02. Accounting Terms and Determinations.............................17
SECTION 1.03. Use of Defined Terms............................................18
SECTION 1.04. Terminology.....................................................18
SECTION 1.05. References......................................................18
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Syndicated Loans............................18
SECTION 2.02. Method of Borrowing Syndicated Loans............................19
SECTION 2.03. Money Market Loans..............................................21
SECTION 2.04. Notes...........................................................24
SECTION 2.05. Maturity of Loans...............................................25
SECTION 2.06. Interest Rates..................................................25
SECTION 2.07. Fees............................................................28
SECTION 2.08. Optional Termination or Reduction of Commitments................29
SECTION 2.09. Mandatory Termination of Commitments............................29
SECTION 2.10. Optional Prepayments............................................29
SECTION 2.11. Mandatory Prepayments...........................................30
SECTION 2.12. General Provisions as to Payments...............................30
SECTION 2.13. Computation of Interest and Fees................................32
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to Closing...........................................32
SECTION 3.02. Conditions to All Borrowings....................................34
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power...................................34
SECTION 4.02. Corporate and Governmental Authorization; No Contravention......35
SECTION 4.03. Binding Effect..................................................35
SECTION 4.04. Financial Information...........................................35
SECTION 4.05. No Litigation...................................................35
SECTION 4.06. Compliance with ERISA...........................................35
SECTION 4.07. Compliance with Laws; Payment of Taxes..........................36
SECTION 4.08. Subsidiaries....................................................36
SECTION 4.09. Investment Company Act..........................................36
SECTION 4.10. Public Utility Holding Company Act..............................36
SECTION 4.11. Ownership of Property; Liens....................................36
SECTION 4.12. No Default......................................................37
SECTION 4.13. Full Disclosure.................................................37
SECTION 4.14. Environmental Matters...........................................37
SECTION 4.15. Capital Stock...................................................37
SECTION 4.16. Margin Stock....................................................38
SECTION 4.17. Insolvency......................................................38
SECTION 4.18. Compliance with Year 2000 Plan..................................38
ARTICLE V
COVENANTS
SECTION 5.01. Information.....................................................38
SECTION 5.02. Inspection of Property, Books and Records.......................40
SECTION 5.03. Ratio of Consolidated Debt to Consolidated EBITDA...............41
SECTION 5.04. Minimum Shareholders'Equity.....................................41
SECTION 5.05. Restricted Payments.............................................41
SECTION 5.06. Loans or Advances...............................................41
SECTION 5.07. Acquisitions....................................................41
SECTION 5.08. Negative Pledge.................................................41
SECTION 5.09. Maintenance of Existence........................................42
SECTION 5.10. Dissolution.....................................................42
SECTION 5.11. Consolidations, Mergers and Sales of Assets.....................43
SECTION 5.12. Use of Proceeds.................................................43
SECTION 5.13. Compliance with Laws; Payment of Taxes..........................43
SECTION 5.14. Insurance.......................................................44
SECTION 5.15. Change in Fiscal Year...........................................44
SECTION 5.16. Maintenance of Property.........................................44
SECTION 5.17. Environmental Notices...........................................44
SECTION 5.18. Environmental Matters...........................................44
SECTION 5.19. Environmental Release...........................................44
SECTION 5.20. Transactions with Affiliates....................................44
SECTION 5.21. Limitation on Subsidiary Debt...................................44
SECTION 5.22. Material Subsidiaries...........................................45
SECTION 5.23. Y2K Plan........................................................45
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default...............................................45
SECTION 6.02. Notice of Default...............................................48
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities..............................48
SECTION 7.02. Reliance by Agent...............................................49
SECTION 7.03. Defaults........................................................49
SECTION 7.04. Rights of Agent and its Affiliates as a Bank....................49
SECTION 7.05. Indemnification.................................................49
SECTION 7.06. CONSEQUENTIAL DAMAGES...........................................50
SECTION 7.07. Payee of Note Treated as Owner..................................50
SECTION 7.08. Non-Reliance on Agent and Other Banks...........................50
SECTION 7.09. Failure to Act..................................................51
SECTION 7.10. Resignation or Removal of Agent.................................51
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair........51
SECTION 8.02. Illegality......................................................52
SECTION 8.03. Increased Cost and Reduced Return...............................52
SECTION 8.04. Base Rate Loans or Other Fixed Rate Loans Substituted for
Affected Fixed Rate Loans.......................................54
SECTION 8.05. Compensation....................................................54
SECTION 8.06. Failure to Pay in Foreign Currency..............................55
SECTION 8.07. Judgment Currency...............................................55
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices.........................................................56
SECTION 9.02. No Waivers......................................................56
SECTION 9.03. Expenses; Documentary Taxes; Indemnification....................56
SECTION 9.04. Setoffs; Sharing of Set-Offs....................................57
SECTION 9.05. Amendments and Waivers..........................................58
SECTION 9.06. Margin Stock Collateral.........................................58
SECTION 9.07. Successors and Assigns..........................................59
SECTION 9.08. Confidentiality.................................................61
SECTION 9.09. Representation by Banks.........................................61
SECTION 9.10. Obligations Several.............................................61
SECTION 9.11. Survival of Certain Obligations.................................61
SECTION 9.12. Georgia Law.....................................................61
SECTION 9.13. Severability....................................................61
SECTION 9.14. Interest........................................................62
SECTION 9.15. Interpretation..................................................62
SECTION 9.16. Consent to Jurisdiction.........................................62
SECTION 9.17. Counterparts....................................................62
SECTION 9.18. European Economic and Monetary Union............................62
SECTION 9.19. Concerning Joint and Several Liability of the Borrowers.........65
Schedule 1.01 Material Subsidiaries
Schedule 4.08 Existing Subsidiaries
Schedule 4.14 Environmental Matters
EXHIBIT A Form of Syndicated Dollar Note
EXHIBIT B Form of Syndicated Foreign Currency Note
EXHIBIT C Form of Money Market Note
EXHIBIT D Form of Opinion of Counsel for the Borrowers and the Guarantors
EXHIBIT E Form of Opinion of Special Counsel for the Agent
EXHIBIT F Form of Money Market Quote Request
EXHIBIT G Form of Money Market Quote
EXHIBIT H Form of Closing Certificate
EXHIBIT I Form of Secretary's Certificate
EXHIBIT J Form of Compliance Certificate
EXHIBIT K Form of Assignment and Acceptance
EXHIBIT L Form of Notice of Borrowing
EXHIBIT M Form of Guaranty
EXHIBIT N Form of Indemnity, Subrogation and Contribution Agreement
AMENDED AND RESTATED CREDIT AGREEMENT
AGREEMENT dated as of February 26, 1999 among THE VALSPAR
CORPORATION, ENGINEERED POLYMER SOLUTIONS, INC., THE VALSPAR (UK) HOLDING
CORPORATION LTD., THE VALSPAR (SWITZERLAND) HOLDING CORPORATION A.G., FORTON
B.V. and DYFLEX B.V., the BANKS listed on the signature pages hereof, CHASE
SECURITIES INC., as Syndication Agent, and WACHOVIA BANK, N.A., as
Administrative Agent and Documentation Agent.
The Parent, the Agent and certain of the Banks entered into a Credit
Agreement dated as of April 20, 1995 (as amended, modified or supplemented, the
"Original Credit Agreement"). The Parent has requested the Agent and such Banks
to amend and restate the Original Credit Agreement in its entirety, and the
Agent and such Banks have agreed to amend and restate the Original Credit
Agreement, as hereinafter set forth.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this Section 1.01
shall, for all purposes of this Agreement and any amendment hereto (except as
herein otherwise expressly provided or unless the context otherwise requires),
have the meanings set forth herein:
"Acquisition" means any transaction pursuant to which the Parent or
any of its Subsidiaries directly or indirectly, in its own name or by or through
a nominee or an agent (a) acquires equity Securities (or warrants, options or
other rights to acquire such Securities) of any Person other than the Parent or
any Person which is not then a Subsidiary of the Parent, pursuant to a
solicitation of tenders therefor, or in one or more negotiated block, market or
other transactions not involving a tender offer, or a combination of any of the
foregoing, or (b) makes any Person a Subsidiary of the Parent, or causes any
Person other than a Subsidiary to be merged into the Parent or any of its
Subsidiaries, in any case pursuant to a merger, purchase of assets or any
reorganization providing for the delivery or issuance to the holders of such
Person's then outstanding Securities, in exchange for such Securities, of cash
or Securities of the Parent or any of its Subsidiaries, or a combination
thereof, or (c) purchases all or substantially all of the business or assets of
any Person.
"Adjusted IBOR Rate" has the meaning set forth in Section 2.06(d).
"Adjusted London Interbank Offered Rate" has the meaning set forth
in Section 2.06(c).
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"Affiliate" of any Person means (i) any other Person which directly,
or indirectly through one or more intermediaries, controls such Person, (ii) any
other Person which directly, or indirectly through one or more intermediaries,
is controlled by or is under common control with such Person, or (iii) any other
Person of which such Person owns, directly or indirectly, 20% or more of the
common stock or equivalent equity interests. As used herein, the term "control"
means possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means Wachovia Bank, N.A., a national banking
association organized under the laws of the United States of America, in its
capacity as administrative agent for the Banks hereunder, and its successors and
permitted assigns in such capacity.
"Agent's Letter Agreement" means that certain letter
agreement, dated as of October 14, 1998, between the Parent and the Agent
relating to the structure of the Loans, and certain fees from time to time
payable by the Borrowers to the Agent, together with all amendments and
modifications thereto.
"Agreement" means this Credit Agreement, together with
all amendments and supplements hereto.
"Applicable Facility Fee Rate" has the meaning set forth in Section
2.07(a).
"Applicable Margin" has the meaning set forth in Section 2.06(a).
"Assignee" has the meaning set forth in Section 9.07(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.07(c) in the form attached hereto as
Exhibit K.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate per
annum equal to the higher as of such day of (i) the Prime Rate, and (ii)
one-half of one percent above the Federal Funds Rate for such day. For purposes
of determining the Base Rate for any day, changes in the Prime Rate and the
Federal Funds Rate shall be effective on the date of each such change.
"Base Rate Loan" means a Loan which bears or is to bear interest at
a rate based upon the Base Rate.
2
"Borrower" means any of the Parent, EPS, the UK Company, the Swiss
Company, Forton and Dyflex.
"Borrowing" means a borrowing hereunder consisting of Loans made to
a Borrower at the same time by, in the case of a Syndicated Borrowing, the
Banks, or, in the case of a Money Market Borrowing, one or more of the Banks, in
each case pursuant to Article II. A Borrowing is a "Syndicated Borrowing" if
such Loans are Syndicated Loans or a "Money Market Borrowing" if such Loans are
Money Market Loans. A Syndicated Borrowing is a "Syndicated Dollar Borrowing" if
such Loans are Syndicated Dollar Loans or a "Syndicated Foreign Currency
Borrowing" if such Loans are Syndicated Foreign Currency Loans. A Syndicated
Dollar Borrowing is a "Base Rate Borrowing" if such Syndicated Dollar Loans are
Base Rate Loans or a "Euro-Dollar Borrowing" if such Syndicated Dollar Loans are
Euro-Dollar Loans.
"Canadian Dollars" means the lawful currency of Canada.
"Capital Stock" means any capital stock (other than Redeemable
Preferred Stock) of the Parent or any Consolidated Subsidiary (to the extent
issued to a Person other than the Parent), whether common or preferred.
"CERCLA" means the Comprehensive Environmental Response Compensation
and Liability Act, 42 U.S.C. ss.9601 et seq. and its implementing regulations
and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Information System established pursuant to CERCLA.
"Change of Law" shall have the meaning set forth in Section 8.02.
"Closing Certificate" has the meaning set forth in Section 3.01(g).
"Closing Date" means the date on which each of the conditions set
forth in Section 3.01 has been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor Federal tax code. Any reference to any provision of the Code shall
also be deemed to be a reference to any successor provision or provisions
thereof.
"Commitment" means, with respect to each Bank, (i) the amount set
forth opposite the name of such Bank on the signature pages hereof, or (ii) as
to any Bank which enters into an Assignment and Acceptance (whether as
transferor Bank or as Assignee thereunder), the amount of such Bank's Commitment
after giving effect to such Assignment and Acceptance, in each case as such
amount may be reduced from time to time pursuant to Sections 2.08 and 2.09.
"Compliance Certificate" has the meaning set forth in Section
5.01(c).
3
"Consolidated Debt" means at any date the Debt of the Parent and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated EBITDA" for any period means the sum of (i)
Consolidated Net Income for such period; (ii) Consolidated Interest Expense for
such period, (iii) taxes on income of the Parent and its Consolidated
Subsidiaries for such period to the extent deducted in determining Consolidated
Net Income for such period, (iv) Depreciation for such period and (v)
amortization of intangible assets of the Parent and its Consolidated
Subsidiaries for such period. In determining Consolidated EBITDA for any period,
any Consolidated Subsidiary acquired during such period by the Parent or any
other Consolidated Subsidiary shall be included on a pro forma, historical basis
as if it had been a Consolidated Subsidiary during such entire period.
"Consolidated Interest Expense" for any period means interest,
whether expensed or capitalized, in respect of Debt of the Parent or any of its
Consolidated Subsidiaries outstanding during such period.
"Consolidated Net Income" means, for any period, the Net Income of
the Parent and its Consolidated Subsidiaries determined on a consolidated basis,
but excluding (i) extraordinary items and (ii) any equity interests of the
Parent or any Subsidiary in the unremitted earnings of any Person that is not a
Subsidiary.
"Consolidated Operating Profits" means, for any period, the
Operating Profits of the Parent and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which, in accordance with GAAP, would be consolidated
with those of the Parent in its consolidated financial statements as of such
date.
"Consolidated Total Assets" means, at any time, the Total Assets of
the Parent and its Consolidated Subsidiaries, determined on a consolidated
basis.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Parent, are treated as a single employer
under Section 414 of the Code.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, but only if such obligations are, in accordance with GAAP, recorded on
such Person's financial books as long-term debt, (iv) all obligations of such
Person as lessee under capital leases, (v) all obligations of such Person to
reimburse any bank or other Person in respect of amounts payable under a
banker's acceptance, (vi) all Redeemable Preferred Stock of such Person (in the
event such Person is a corporation), (vii) all obligations (absolute or
contingent) of such Person to reimburse any bank or other Person in respect of
amounts paid
4
under a letter of credit or similar instrument, (viii) all Debt of others
secured by a Lien on any asset of such Person, whether or not such Debt is
assumed by such Person, (ix) all Debt of others Guaranteed by such Person, and
(x) the net obligation of such Person with respect to interest rate protection
agreements, foreign currency exchange agreements or other hedging agreements
(and for purposes of this Agreement, the net amount which such Person is
obligated to pay under any such agreement upon termination of such agreement
shall be deemed to constitute the principal amount of such net obligation).
"Debt Rating" means, on any date, the long-term rating assigned by
Duff & Phelps, Fitch, Moody's or S&P, as the case may be, to the Rated Debt.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived in writing, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day, the sum
of 2% plus the interest rate (including the Applicable Margin) which would
otherwise be applicable to such Loan hereunder.
"Depreciation" means for any period the sum of all depreciation
expenses of the Parent and its Consolidated Subsidiaries for such period, as
determined in accordance with GAAP.
"Deutsche Marks" means the lawful currency of the Federal Republic
of Germany.
"Dollar Equivalent" means the Dollar equivalent of the amount of a
Foreign Currency Loan or Foreign Currency Borrowing, as the case may be,
determined by the Agent on the basis of its spot rate for the purchase of the
appropriate Foreign Currency with Dollars.
"Dollars" or "$" means dollars in lawful currency of the United
States of America.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in Georgia are authorized or required by law
to close.
"Domestic Material Subsidiary" means any Material Subsidiary which
is organized under the laws of any state or territory of the United States of
America.
"Domestic Subsidiary" means any Subsidiary which is organized under
the laws of any state or territory of the United States of America.
"Duff & Phelps" means Duff & Phelps Credit Rating Co., and its
successors and assigns.
5
"Dutch Guilders" means the lawful currency of The Kingdom of The
Netherlands.
"Dyflex" means Dyflex B.V., a Dutch corporation, and its successors
and permitted assigns.
"Environmental Authority" means any foreign, federal, state, local
or regional government that exercises any form of jurisdiction or authority
under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits, orders,
approvals, notices, registrations or other legal prerequisites for conducting
the business of the Parent or any Subsidiary required by any Environmental
Requirement.
"Environmental Judgments and Orders" means all judgments, decrees or
orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with an
Environmental Authority or other entity arising from or in any way associated
with any Environmental Requirement, whether or not incorporated in a judgment,
decree or order.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment, including, without limitation, ambient air, surface water,
groundwater or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.
"Environmental Liabilities" means any liabilities, whether accrued,
contingent or otherwise, arising from and in any way associated with any
Environmental Requirements.
"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of alleged material noncompliance
with or material liability under any Environmental Requirement, including
without limitation any complaints, citations, demands or requests from any
Environmental Authority or from any other person or entity for correction of any
violation of any Environmental Requirement or any investigations concerning any
violation of any Environmental Requirement.
"Environmental Proceedings" means any judicial or administrative
proceedings to which the Parent or any Subsidiary is a party or to which its
property is subject, arising from or in any way associated with any
Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA or
under any
6
applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement relating to
health, safety or the environment and applicable to the Parent, any Subsidiary
or the Properties, including but not limited to any such requirement under
CERCLA or similar state legislation and all federal, state and local laws,
ordinances, regulations, orders, writs, decrees and common law.
"EPS" means Engineered Polymer Solutions, Inc., a Delaware
corporation, and its successors and permitted assigns.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, or any successor law. Any reference to any
provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on which
dealings in Dollar deposits are carried out in the London interbank market.
"Euro-Dollar Loan" means a Syndicated Dollar Loan which bears or is
to bear interest at a rate based upon the London Interbank Offered Rate.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.06(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Existing Note" means the Note of the Parent, dated March 17, 1998,
payable to the order of Wachovia, in the principal amount of $50,000,000.
"Facility Fee Payment Date" means each March 31, June 30, September
30 and December 31.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the next higher 1/100th of 1%) 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 on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if the day for which such rate is to
be determined is not a Domestic Business Day, the Federal Funds Rate for such
day shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day, and
(ii) if such rate is not so published for any day, the Federal Funds Rate for
such day shall be the average rate charged to Wachovia on such day on such
transactions as determined by the Agent.
"Fiscal Quarter" means any fiscal quarter of the Parent.
"Fiscal Year" means any fiscal year of the Parent.
7
"Fitch" means Fitch IBCA Information Services, Inc., and its
successors and assigns.
"Fixed Rate Borrowing" means a Euro-Dollar Borrowing or a Syndicated
Foreign Currency Borrowing.
"Fixed Rate Loans" means Euro-Dollar Loans or Syndicated Foreign
Currency Loans, or any or all of them, as the context shall require.
"Foreign Currencies" means, individually and collectively, as the
context shall require: (i) Sterling, (ii) Dutch Guilders, (iii) Canadian
Dollars, (iv) Italian Lira, (v) Deutsche Marks, (vi) French Francs, (vii) Yen,
(viii) Swiss Francs or (ix) any other currency which is freely transferable and
convertible into Dollars; provided, however, that no such other currency under
this clause (ix) shall be included as a Foreign Currency hereunder, or included
in a Notice of Borrowing, unless (x) the Parent has first submitted a request to
the Agent that it be so included, and (i) the Agent and the Required Banks, in
their sole discretion, have agreed to such request.
"Foreign Currency Business Day" shall mean any Domestic Business
Day, excluding one on which trading is not carried on by and between banks in
deposits of the applicable Foreign Currency in the applicable interbank market
for such Foreign Currency.
"Forton" means Forton B.V., a Dutch corporation, and its successors
and permitted assigns.
"French Francs" means the lawful currency of the Republic of France.
"GAAP" means generally accepted accounting principles applied on a
basis consistent with those which, in accordance with Section 1.02, are to be
used in making the calculations for purposes of determining compliance with the
terms of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to secure, purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to provide collateral security, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
8
"Guarantors" means the Domestic Material Subsidiaries from time to
time party to the Guaranty.
"Guaranty" means the Guaranty Agreement dated as of even date
herewith executed by each Guarantor in favor of the Agent, substantially in the
form attached hereto as Exhibit M, as modified, amended, supplemented or
restated from time to time.
"Hazardous Materials" includes, without limitation, (a) solid or
hazardous waste, as defined in the Resource Conservation and Recovery Act of
1980, 42 U.S.C. ss.6901 et seq. and its implementing regulations and amendments,
or in any applicable state or local law or regulation, (b) any "hazardous
substance", "pollutant" or "contaminant", as defined in CERCLA, or in any
applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including crude oil or any fraction thereof,
(d) toxic substances, as defined in the Toxic Substances Control Act of 1976, or
in any applicable state or local law or regulation and (e) insecticides,
fungicides, or rodenticides, as defined in the Federal Insecticide, Fungicide,
and Rodenticide Act of 1975, or in any applicable state or local law or
regulation, as each such Act, statute or regulation may be amended from time to
time.
"IBOR" has the meaning set forth in Section 2.06(d).
"Indemnity, Subrogation and Contribution Agreement" means the
Indemnity, Subrogation and Contribution Agreement dated as of even date herewith
among the Borrowers, the Guarantors and the Agent, substantially in the form
attached hereto as Exhibit N, as modified, amended, supplemented or restated
from time to time.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing and Syndicated Foreign Currency Borrowing, the period commencing on
the date of such Borrowing and ending on the numerically corresponding day in
the first, second, third or sixth month thereafter, as the relevant Borrower may
elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period (subject to clause (c) below) which would
otherwise end on a day which is not a Euro-Dollar Business Day or a Foreign
Currency Business Day, as the case may be, shall be extended to the next
succeeding Euro-Dollar Business Day or a Foreign Currency Business Day, as the
case may be, unless such Euro-Dollar Business Day or Foreign Currency Business
Day, as the case may be, falls in another calendar month, in which case such
Interest Period shall end on the next preceding Euro-Dollar Business Day or
Foreign Currency Business Day, as the case may be;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day or Foreign Currency Business Day, as the case may be, of a calendar
month (or on a day for which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall, subject to clause (c) below, end
on the last Euro-Dollar Business Day or Foreign Currency Business Day, as the
case may be, of the appropriate subsequent calendar month; and
9
(c) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(2) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Domestic Business Day shall be extended to
the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(3) with respect to each Money Market Borrowing, the period commencing on the
date of such Borrowing and ending 7 to 180 days thereafter, as the relevant
Borrower may indicate in the applicable Money Market Quote Request; provided
that:
(a) any Interest Period (subject to clause (b) below) which would
otherwise end on a day which is not a Domestic Business Day shall be extended to
the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
"Italian Lira" means the lawful currency of the Republic of Italy.
"Lending Office" means, as to each Bank, its office or the office of
any Affiliate of such Bank located at the address set forth on the signature
pages hereof (or identified on the signature pages hereof as its Lending Office)
or such other office as such Bank may hereafter designate as its Lending Office
by notice to the Parent and the Agent. Each Bank may designate a Lending Office
for Syndicated Dollar Loans and a different Lending Office for Syndicated
Foreign Currency Loans and the term Lending Office shall in such case mean
either such Lending Office, as the context shall require.
"Level" means, at any time Rated Debt is outstanding, as applicable,
one of Level 1, Level 2, Level 3 or Level 4; provided that in determining the
applicable Level on any date (i) if both Moody's and S&P are providing Debt
Ratings on such date, the applicable Level shall be determined by reference only
to the Debt Ratings provided by Moody's and S&P, (ii) if only Moody's or S&P is
providing a Debt Rating on such date, the applicable Level shall be determined
by reference to the Debt Rating provided by Moody's or S&P, as the case may be,
on such date and the Debt Rating provided by either Duff & Phelps or Fitch (as
selected by the Parent) on such date, (iii) if the Debt Ratings used to
determine the applicable Level on such date are one level apart, the higher Debt
Rating shall be used to determine the applicable Level, (iv) if
10
the Debt Ratings used to determine the applicable Level on such date are more
than one level apart, the rating which is one level higher than the lower of
such two Debt Ratings shall be used to determine the applicable Level, and (v)
once the two rating agencies have been selected (as provided in this definition)
for the purpose of determining the applicable Level, no other rating agency may
thereafter be selected to replace or substitute for either such rating agency,
without the prior written consent of the Agent and the Required Banks.
"Level 1" means, subject to the definition of "Level" set forth in
this Section, that, on any Performance Pricing Determination Date, the Debt
Rating of two of the following is as indicated: (a) "BBB+" or higher from Duff &
Phelps, (b) "AA" or higher from Fitch, (c) "Baa1" or higher from Moody's and (d)
"BBB+" or higher from S&P.
"Level 2" means, subject to the definition of "Level" set forth in
this Section, that, on any Performance Pricing Determination Date, the Debt
Rating of two of the following is as indicated: (a) "BBB" from Duff & Phelps,
(b) "A" from Fitch, (c) "Baa2" from Moody's and (d) "BBB" from S&P.
"Level 3" means, subject to the definition of "Level" set forth in
this Section, that, on any Performance Pricing Determination Date, the Debt
Rating of two of the following is as indicated: (a) "BBB-" from Duff & Phelps,
(b) "BBB" from Fitch, (c) "Baa3" from Moody's and (d) "BBB-" from S&P.
"Level 4" means, subject to the definition of "Level" set forth in
this Section, that, on any Performance Pricing Determination Date, the Debt
Rating of two of the following is as indicated: (a)"BB+" or lower from Duff &
Phelps, (b)"BB" or lower from Fitch, (c) "Ba1" or lower from Moody's and (d)
"BB+" or lower from S&P.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest, security
title, preferential arrangement which has the practical effect of constituting a
security interest or encumbrance, servitude or encumbrance of any kind in
respect of such asset to secure or assure payment of a Debt or a Guarantee,
whether by consensual agreement or by operation of statute or other law, or by
any agreement, contingent or otherwise, to provide any of the foregoing. For the
purposes of this Agreement, the Parent or any Subsidiary shall be deemed to own
subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease (but not an operating lease) or other title retention agreement relating
to such asset.
"Loan" means a Syndicated Loan or a Money Market Loan and "Loans"
means Syndicated Loans or Money Market Loans, or any or all of them, as the
context shall require.
"Loan Documents" means this Agreement, the Notes, the Guaranty, the
Indemnity, Subrogation and Contribution Agreement, any other document
evidencing, relating to or securing the Loans, and any other document or
instrument delivered from time to time in
11
connection with this Agreement, the Notes, the Guaranty, the Indemnity,
Subrogation and Contribution Agreement, or the Loans, as such documents and
instruments may be amended or supplemented from time to time.
"London Interbank Offered Rate" has the meaning set forth in Section
2.06(c).
"Margin Stock" means "margin stock" as defined in Regulation T, U or
X of the Board of Governors of the Federal Reserve System, as in effect from
time to time, together with all official rulings and interpretations issued
thereunder.
"Material Adverse Effect" means, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences, whether or not related, that
such event, act, condition or occurrence has resulted or is reasonably likely to
result in a material adverse change in, or a material adverse effect upon, any
of (a) the financial condition, operations, business or properties of the Parent
and its Consolidated Subsidiaries taken as a whole, (b) the rights and remedies
of the Agent or the Banks under the Loan Documents, or the ability of the Parent
to perform its obligations under the Loan Documents to which it is a party, as
applicable, or (c) the legality, validity or enforceability of any Loan
Document.
"Material Subsidiary" means (a) on the Closing Date, each of the
Subsidiaries listed on Schedule 1.01 hereto, and (b) on any date after the
Closing Date, any Subsidiary of the Parent which has either (i) Total Assets on
the last day of the Fiscal Quarter most recently ended equal to or greater than
10% of Consolidated Total Assets on the last day of the Fiscal Quarter most
recently ended, or (ii) Operating Profits for the period of 4 consecutive Fiscal
Quarters most recently ended prior to such date equal to or greater than 5% of
Consolidated Operating Profits for such period of 4 consecutive Fiscal Quarters;
provided that any Subsidiary of the Parent that is a "foreign sales corporation"
as defined in Section 922(a) of the Code shall not be deemed to be a Material
Subsidiary.
"Money Market Loan" means a Loan which bears or is to bear interest
at a Money Market Rate.
"Money Market Notes" means promissory notes of the Borrowers,
substantially in the form of Exhibit C hereto, evidencing the obligation of the
Borrowers to repay the Money Market Loans, together with all amendments,
consolidations, modifications, renewals and supplements thereto and "Money
Market Note" means any one of such Money Market Notes.
"Money Market Quote" means an offer by a Bank to make a Money Market
Loan in accordance with Section 2.03(c).
"Money Market Quote Request" has the meaning set forth in Section
2.03(b).
12
"Money Market Rate" has the meaning set forth in Section
2.03(c)(ii)(C).
"Moody's" means Moody's Investors Service, Inc., and its successors
and assigns.
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Net Income" means, as applied to any Person for any period, the
aggregate amount of net income of such Person, after taxes, for such period, as
determined in accordance with GAAP.
"Net Proceeds of Capital Stock/Conversion of Debt" means any and all
proceeds (whether cash or non-cash) or other consideration received by the
Parent or a Consolidated Subsidiary in respect of the issuance of Capital Stock
(including, without limitation, the aggregate amount of any and all Debt
converted into Capital Stock), after deducting therefrom all reasonable and
customary costs and expenses incurred by the Parent or such Consolidated
Subsidiary directly in connection with the issuance of such Capital Stock.
"Note" means a Syndicated Note or a Money Market Note and "Notes"
means Syndicated Notes or Money Market Notes, or any or all of them, as the
context shall require.
"Notice of Borrowing" has the meaning set forth in Section 2.02.
"Operating Profits" means, as applied to any Person for any period,
the operating income of such Person for such period, as determined in accordance
with GAAP.
"Parent" means The Valspar Corporation, a Delaware corporation, and
its successors and permitted assigns.
"Participant" has the meaning set forth in Section 9.07(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Pending Acquisition" means the acquisition by the Parent from
Dexter Corporation of the "Acquired Assets" (as defined in the Purchase
Agreement) pursuant to the terms of the Purchase Agreement.
"Performance Pricing Determination Date" has the meaning set forth
in Section 2.07(b).
"Permitted Acquisition" means any Acquisition (a) which is of a
Person engaged in the same or similar line or lines of business as the Parent or
any Consolidated Subsidiaries, and (b) if the aggregate consideration to be paid
by the Parent or any Subsidiary in connection
13
with such Acquisition exceeds $100,000,000, as to which the Parent has delivered
to the Banks a certificate of the chief financial officer, treasurer or chief
accounting officer of the Parent certifying (and, in the case of Sections 5.03,
5.04, 5.08 and 5.11(d), including calculations evidencing) pro-forma compliance
with the terms of this Agreement after giving effect to such Acquisition.
"Person" means an individual, a corporation, a limited liability
company, a partnership (including without limitation, a joint venture), an
unincorporated association, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code and is either (i) maintained by a member of the
Controlled Group for employees of any member of the Controlled Group or (ii)
maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding 5 plan years made contributions.
"Prepaid Rebates" means any payment made to or credit allowed to a
customer or prospective customer of the Parent or any Subsidiary, or to any
affiliate of the customer or prospective customer, in each case in the ordinary
course of the Parent's or such Subsidiary's business and pursuant to a written
agreement or purchase order, which represents the prepayment of a rebate, price
discount or price reduction on products sold or to be sold by the Parent or such
Subsidiary to one or more customers or prospective customers.
"Prime Rate" refers to that interest rate so denominated and set by
Wachovia from time to time as an interest rate basis for borrowings. The Prime
Rate is but one of several interest rate bases used by Wachovia. Wachovia lends
at interest rates above and below the Prime Rate.
"Properties" means all real property owned, leased or otherwise used
or occupied by the Parent or any Subsidiary, wherever located.
"Purchase Agreement" means that certain Dexter Coatings Business
Purchase and Sale Agreement dated August 21, 1998, between Dexter Corporation, a
Connecticut corporation, as seller, and the Parent, as purchaser, together with
all agreements, exhibits, schedules, annexes and documents executed or delivered
in connection therewith.
"Quotation Date" has the meaning set forth in Section 2.03(b).
"Rated Debt" means the senior, unsecured and non-credit enhanced
indebtedness of the Parent which has been made subject to Debt Ratings requested
by the Parent issued by any two of S&P, Moody's, Fitch and Duff & Phelps, one of
which must be S&P or Moody's.
"Redeemable Preferred Stock" of any Person means any preferred stock
issued by
14
such Person which is at any time prior to the Termination Date either (i)
mandatorily redeemable (by sinking fund or similar payments or otherwise) or
(ii) redeemable at the option of the holder thereof.
"Refunding Loan" means a new Loan made on the day on which an
outstanding Loan is maturing, if and to the extent that the proceeds thereof are
used entirely for the purpose of paying such maturing Loan, excluding any
difference between the amount of such maturing Loan and any greater amount being
borrowed on such day and actually either being made available to the relevant
Borrower pursuant to Section 2.02(c) or remitted to the Agent as provided in
Section 2.12, in each case as contemplated in Section 2.02(d).
"Reported Net Income" means, for any period, the Net Income of the
Parent and its Consolidated Subsidiaries determined on a consolidated basis.
"Required Banks" means at any time Banks having at least 51% of the
aggregate amount of the Commitments or, if the Commitments are no longer in
effect, Banks holding at least 51% of the aggregate outstanding principal amount
of the Notes.
"Restricted Payment" means (i) any dividend or other distribution on
any shares of the Borrower's capital stock (except dividends payable solely in
shares of its capital stock) or (ii) any payment on account of the purchase,
redemption, retirement or acquisition of any shares of the Borrower's capital
stock (except shares acquired upon the conversion thereof into other shares of
its capital stock).
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., and its successors and assigns.
"Security" has the meaning assigned to such term in Section 2(l) of
the Securities Act of 1933, as amended.
"Shareholders' Equity" means, at any time, the shareholders' equity
of the Parent and its Consolidated Subsidiaries, as set forth or reflected on
the most recent consolidated balance sheet of the Parent and its Consolidated
Subsidiaries prepared in accordance with GAAP, but excluding any Redeemable
Preferred Stock of the Parent or any of its Consolidated Subsidiaries.
Shareholders' equity generally would include, but not be limited to (i) the par
or stated value of all outstanding Capital Stock, (ii) capital surplus, (iii)
retained earnings, and (iv) various deductions such as (A) purchases of treasury
stock, (B) valuation allowances, (C) receivables due from an employee stock
ownership plan, (D) employee stock ownership plan debt guarantees, and (E)
translation adjustments for foreign currency transactions.
"Sterling" means the lawful currency of the United Kingdom.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or
15
other persons performing similar functions are at the time directly or
indirectly owned by the Parent.
"Swiss Company" means The Valspar (Switzerland) Holding Corporation
A.G., a Swiss corporation, and its successors and permitted assigns.
"Swiss Francs" means the lawful currency of Switzerland.
"Syndicated Dollar Loans" means loans made in Dollars by all of the
Banks at the same time pursuant to Section 2.01, which may be either Base Rate
Loans or Euro-Dollar Loans.
"Syndicated Dollar Notes" means promissory notes of each of the
Borrowers, substantially in the form of Exhibit A hereto, evidencing the
obligation of the Borrowers to repay the Syndicated Dollar Loans, together with
all amendments, consolidations, modifications, renewals and supplements thereto.
"Syndicated Foreign Currency Loans" means loans made in a Foreign
Currency by all of the Banks at the same time pursuant to Section 2.01.
"Syndicated Foreign Currency Notes" means promissory notes of each
of the Borrowers, substantially in the form of Exhibit B hereto, evidencing the
obligation of the Borrowers to repay the Foreign Currency Loans, together with
all amendments, consolidations, modifications, renewals and supplements thereto.
"Syndicated Loan" means a Syndicated Dollar Loan or a Syndicated
Foreign Currency Loan and Syndicated Loans means Syndicated Dollar Loans or
Syndicated Foreign Currency Loans, or any or all of them, as the context shall
require.
"Syndicated Notes" means the Syndicated Dollar Notes and the
Syndicated Foreign Currency Notes and "Syndicated Note" means any one of such
Syndicated Notes.
"Taxes" has the meaning set forth in Section 2.12(d).
"Termination Date" means August 26, 2000.
"Third Parties" means all lessees, sublessees, licensees and other
users of the Properties, excluding those users of the Properties in the ordinary
course of the Parent's or any Subsidiary's business and on a temporary basis.
"Total Assets" of any Person means, at any time, the total assets of
such Person, as set forth or reflected or as should be set forth or reflected on
the most recent balance sheet of such Person, prepared in accordance with GAAP.
"Total Unused Commitments" means at any date, an amount equal to:
(i) the
16
aggregate amount of the Commitments of all of the Banks at such time, less (ii)
the aggregate outstanding principal amount of the Loans of all of the Banks at
such time.
"Transferee" has the meaning set forth in Section 9.07(d).
"UK Company" means The Valspar (UK) Holding Corporation Ltd., a
limited liability company organized under the laws of the United Kingdom, and
its successors and permitted assigns.
"Unused Commitment" means at any date, with respect to any Bank, an
amount equal to its Commitment less the aggregate outstanding principal amount
of its Syndicated Loans.
"Wachovia" means Wachovia Bank, N.A., a national banking association
and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Parent.
"Y2K Plan" has the meaning set forth in Section 4.18.
"Year 2000 Ready" as used herein means that the Parent's and its
Subsidiaries' hardware and software systems with respect to the operation of its
business and its general business plan will handle date information involving
critical dates before, during and/or after January 1, 2000, including accepting
input, providing output and performing date calculations accurately without
material interruption to the Parent's or its Subsidiaries' operations before,
during and/or after January 1, 2000.
"Yen" means the lawful currency of Japan.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all terms of an accounting character used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Parent's independent public accountants or otherwise
required by a change in GAAP) with the most recent audited consolidated
financial statements of the Parent and its Consolidated Subsidiaries delivered
to the Banks, unless with respect to any such change concurred in by the
Parent's independent public accountants or required by GAAP, in determining
compliance with any of the provisions of this Agreement or any of the other Loan
Documents: (i) the Parent shall have objected to determining such compliance on
such basis at the time of delivery of such financial statements, or (ii) the
Required Banks shall so object in writing within 30 days after the delivery of
such financial statements, in either of which events such calculations shall be
made on a basis consistent with those used in the preparation of the
17
latest financial statements as to which such objection shall not have been made
(which, if objection is made in respect of the first financial statements
delivered under Section 5.01 hereof, shall mean the financial statements
referred to in Section 4.04).
SECTION 1.03. Use of Defined Terms. All terms defined in this
Agreement shall have the same meanings when used in any of the other Loan
Documents, unless otherwise defined therein or unless the context shall
otherwise require.
SECTION 1.04. Terminology. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender, shall
include all other genders; the singular shall include the plural and the plural
shall include the singular. Titles of Articles and Sections in this Agreement
are for convenience only, and neither limit nor amplify the provisions of this
Agreement.
SECTION 1.05. References. Unless otherwise indicated, references in
this Agreement to "Articles", "Exhibits", "Schedules", and "Sections" are
references to articles, exhibits, schedules and sections hereof.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Syndicated Loans. Each Bank
severally agrees, on the terms and conditions set forth herein, to make
Syndicated Loans to any Borrower from time to time before the Termination Date;
provided that, immediately after each such Syndicated Loan is made, the sum of
the aggregate outstanding principal amount of Syndicated Dollar Loans and the
Dollar Equivalent of the aggregate outstanding principal amount of Syndicated
Foreign Currency Loans by such Bank shall not exceed the amount of its
Commitment, provided further that the sum of the aggregate principal amount of
all Syndicated Dollar Loans and the Dollar Equivalent of the aggregate
outstanding principal amount of all Syndicated Foreign Currency Loans, together
with the aggregate principal amount of all Money Market Loans, at any one time
outstanding shall not exceed the aggregate amount of the Commitments of all of
the Banks at such time. The Dollar Equivalent of each Syndicated Foreign
Currency Loan on the date each such Syndicated Foreign Currency Loan is
disbursed shall be deemed to be the amount of the Syndicated Foreign Currency
Loan outstanding for the purpose of calculating the unutilized portion of the
Commitments on the date of disbursement. Each Euro-Dollar Borrowing under this
Section shall be in an aggregate principal amount of $5,000,000 or any larger
multiple of $1,000,000 (except that any such Euro-Dollar Borrowing may be in the
aggregate amount of the Unused Commitments) and shall be made from the several
Banks ratably in proportion to their respective Commitments. Each Syndicated
Foreign Currency Borrowing under this Section shall be in an aggregate principal
amount equal to the Dollar Equivalent of $5,000,000 (rounded to the nearest
Dollar) or any larger multiple of the Dollar Equivalent of $1,000,000 (rounded
to the nearest Dollar) in the relevant Foreign Currency (except that any such
Syndicated Foreign Currency Borrowing may be in the Dollar Equivalent
18
of the aggregate amount of the Unused Commitments) and shall be made from the
several Banks ratably in proportion to their respective Commitments. Each Base
Rate Borrowing under this Section shall be in an aggregate principal amount of
$1,000,000 or any larger multiple of $500,000 (except that any such Base Rate
Borrowing may be in the aggregate amount of the Unused Commitments) and shall be
made from the several Banks ratably in proportion to their respective
Commitments. Within the foregoing limits, the Borrowers may borrow under this
Section, repay or, to the extent permitted by Section 2.10, prepay Syndicated
Loans and reborrow under this Section at any time before the Termination Date.
SECTION 2.02. Method of Borrowing Syndicated Loans. (a) A Borrower
shall give the Agent notice in the form attached hereto as Exhibit L (a "Notice
of Borrowing") prior to 11:00 A.M. (Atlanta, Georgia time) at least 3 Foreign
Currency Business Days before each Syndicated Foreign Currency Borrowing, prior
to 12:00 noon (Atlanta, Georgia time) at least 3 Euro-Dollar Business Days
before each Euro-Dollar Borrowing and prior to 12:00 noon (Atlanta, Georgia
time) on the Domestic Business Day of each Base Rate Borrowing, specifying:
(i) the name of the Borrower,
(ii) the date of such Syndicated Borrowing, which shall be a
Domestic Business Day in the case of a Base Rate Borrowing, a
Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing and
a Foreign Currency Business Day in the case of a Syndicated Foreign
Currency Borrowing,
(iii) the aggregate amount of such Syndicated Borrowing,
(iv) whether the Syndicated Loans comprising such Syndicated
Borrowing are to be Dollar Loans or Syndicated Foreign Currency
Loans, and (A) if such Syndicated Loans are to be Dollar Loans,
whether they are to be Base Rate Loans or Euro-Dollar Loans, and (B)
if such Syndicated Loans are to be Syndicated Foreign Currency
Loans, specifying the Foreign Currency, and
(v) in the case of a Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly
notify each Bank of the contents thereof and of such Bank's ratable share of
such Syndicated Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the relevant Borrower.
(c) Not later than 11:00 A.M. (Atlanta, Georgia time) on the date of
each Syndicated Foreign Currency Borrowing and each Euro-Dollar Borrowing and
not later than 2:00 P.M. (Atlanta, Georgia time) on the date of each Base Rate
Borrowing, each Bank shall (except as provided in subsection (d) of this
Section) make available its ratable share of such Syndicated Borrowing, in
Federal or other funds immediately available in Atlanta, Georgia, to the Agent
at
19
its address referred to in or specified pursuant to Section 9.01(or, with
respect to Syndicated Foreign Currency Borrowings, to the Agent's designated
foreign correspondent bank at the address specified by the Agent), which funds
shall be in Dollars, if such Syndicated Borrowing is a Syndicated Dollar
Borrowing, and in the applicable Foreign Currency, if such Syndicated Borrowing
is a Syndicated Foreign Currency Borrowing. Unless the Agent determines that any
applicable condition specified in Article III has not been satisfied, the Agent
will make the funds so received from the Banks available to the relevant
Borrower at the Agent's aforesaid address not later than 4:30 P.M. (Atlanta,
Georgia time) on the date of the relevant Syndicated Borrowing. Unless the Agent
receives notice from a Bank, at the Agent's address referred to in Section 9.01,
no later than 4:00 P.M. (local time at such address) on the Domestic Business
Day before the date of a Syndicated Borrowing stating that such Bank will not
make a Syndicated Loan in connection with such Syndicated Borrowing, the Agent
shall be entitled to assume that such Bank will make a Syndicated Loan in
connection with such Syndicated Borrowing and, in reliance on such assumption,
the Agent may (but shall not be obligated to) make available such Bank's ratable
share of such Syndicated Borrowing to the relevant Borrower for the account of
such Bank. If the Agent makes such Bank's ratable share available to the
relevant Borrower and such Bank does not in fact make its ratable share of such
Syndicated Borrowing available on such date, the Agent shall be entitled to
recover such Bank's ratable share from such Bank or any Borrower (and for such
purpose shall be entitled to charge such amount to any account of any Borrower
maintained with the Agent), together with interest thereon for each day during
the period from the date of such Syndicated Borrowing until such sum shall be
paid in full at a rate per annum equal to the rate at which the Agent determines
that it obtained (or could have obtained) overnight Federal funds to cover such
amount for each such day during such period, provided that any such payment by a
Borrower of such Bank's ratable share and interest thereon shall be without
prejudice to any rights that such Borrower may have against such Bank. If such
Bank shall repay to the Agent such corresponding amount, such amount so repaid
shall constitute such Bank's Syndicated Loan included in such Syndicated
Borrowing for purposes of this Agreement.
(d) If any Bank makes a new Syndicated Loan hereunder to a Borrower
on a day on which such Borrower is to repay all or any part of an outstanding
Syndicated Loan from such Bank, such Bank shall apply the proceeds of its new
Syndicated Loan to make such repayment and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being
repaid shall be made available by such Bank to the Agent as provided in
subsection (c) of this Section, or remitted by the Borrower to the Agent as
provided in Section 2.12, as the case may be; provided, however, if the Loan
which is to be repaid is a Syndicated Foreign Currency Loan, the foregoing
provisions of the paragraph shall apply only if the new Loan is to be made in
the same Foreign Currency.
(e) Notwithstanding anything to the contrary contained in this
Agreement, no Fixed Rate Borrowing may be made if there shall have occurred a
Default or an Event of Default, which Default or Event of Default shall not have
been cured or waived in writing.
(f) In the event that a Notice of Borrowing fails to specify whether
the Loans
20
comprising such Borrowing are to be Base Rate Loans, Euro-Dollar Loans or
Syndicated Foreign Currency Loans, such Loans shall be made as Base Rate Loans.
If a Borrower is otherwise entitled under this Agreement to repay any Syndicated
Loans maturing at the end of an Interest Period applicable thereto with the
proceeds of a new Borrowing, and such Borrower fails to repay such Syndicated
Loans using its own moneys and fails to give a Notice of Borrowing in connection
with such new Borrowing, a new Syndicated Borrowing shall be deemed to be made
on the date such Syndicated Loans mature in an amount equal to the principal
amount of the Syndicated Loans so maturing, and the Syndicated Loans comprising
such new Borrowing shall be Base Rate Loans, which shall be made in the Dollar
Equivalent of such maturing Syndicated Loans, if such maturing Syndicated Loans
were Syndicated Foreign Currency Loans.
(g) Notwithstanding anything to the contrary contained herein, (i)
there shall not be more than 10 different Interest Periods outstanding at the
same time for Fixed Rate Loans (for which purpose Interest Periods described in
different numbered clauses of the definition of the term "Interest Period" shall
be deemed to be different Interest Periods even if they are coterminous) and
(ii) the proceeds of any Base Rate Borrowing shall be applied first to repay the
unpaid principal amount of all Base Rate Loans (if any) outstanding immediately
before such Base Rate Borrowing.
SECTION 2.03. Money Market Loans. (a) In addition to making
Syndicated Borrowings, at any time the Applicable Margin for Euro-Dollar Loans
is equal to or less than .65% per annum (determined in accordance with Section
2.06(a)), a Borrower may, as set forth in this Section, request the Banks to
make offers to make Money Market Loans to such Borrower. The Banks may, but
shall have no obligation to, make such offers and such Borrower may, but shall
have no obligation to, accept any such offers in the manner set forth in this
Section, provided that:
(i) there may be no more than 10 different Interest Periods
for both Fixed Rate Loans and Money Market Loans outstanding at the
same time (for which purpose Interest Periods described in different
numbered clauses of the definition of the term "Interest Period"
shall be deemed to be different Interest Periods even if they are
coterminous); and
(ii) the aggregate principal amount of all Money Market Loans,
together with the sum of the aggregate principal amount of all
Syndicated Dollar Loans and the Dollar Equivalent of the aggregate
outstanding principal amount of all Syndicated Foreign Currency
Loans, at any one time outstanding shall not exceed the aggregate
amount of the Commitments of all of the Banks at such time.
(b) When a Borrower wishes to request offers to make Money Market
Loans, it shall give the Agent (which shall promptly notify the Banks) notice
substantially in the form of Exhibit F hereto (a "Money Market Quote Request")
so as to be received no later than 12:00 noon (Atlanta, Georgia time) on the
second Domestic Business Day prior to the date of the
21
Money Market Borrowing proposed therein (or such other time and date as such
Borrower and the Agent, with the consent of the Required Banks, may agree),
specifying:
(i) the identity of the Borrower;
(ii) the proposed date of such Money Market Borrowing, which
shall be a Domestic Business Day (the "Quotation Date");
(iii) the aggregate amount of such Money Market Borrowing,
which shall be at least $5,000,000 (and in larger multiples of
$1,000,000) but shall not cause the limits specified in Section
2.03(a) to be violated; and
(iv) the duration of the Interest Period applicable thereto,
which shall be 7 to 180 days.
A Borrower may request offers to make Money Market Loans for up to
three different Interest Periods in a single Money Market Quote Request;
provided that the request for each separate Interest Period shall be deemed to
be a separate Money Market Quote Request for a separate Money Market Borrowing.
Except as otherwise provided in the immediately preceding sentence, the
Borrowers shall not deliver a Money Market Quote Request more frequently than
once every 5 Domestic Business Days.
(c) (i) Each Bank may, but shall have no obligation to, submit a
Money Market Quote containing an offer to make a Money Market Loan in response
to any Money Market Quote Request; provided that, if the relevant Borrower's
request under Section 2.03(b) specified more than one Interest Period, such Bank
may, but shall have no obligation to, make a single submission containing a
separate offer for each such Interest Period and each such separate offer shall
be deemed to be a separate Money Market Quote. Each Money Market Quote must be
submitted to the Agent not later than 10:00 A.M. (Atlanta, Georgia time) on the
Quotation Date (or such other time and date as the relevant Borrower and the
Agent, with the consent of the Required Banks, may agree); provided that any
Money Market Quote submitted by Wachovia may be submitted, and may only be
submitted, if Wachovia notifies the Borrower of the terms of the offer contained
therein not later than 9:45 A.M. (Atlanta, Georgia time) on the Quotation Date.
Subject to Section 6.01, any Money Market Quote so made shall be irrevocable
except with the written consent of the Agent given on the instructions of the
relevant Borrower.
(ii) Each Money Market Quote shall be in substantially the
form of Exhibit G hereto and shall specify:
(A) the proposed date of the Money Market Borrowing and
the duration of the Interest Period therefor, which shall be 7
to 180 days;
(B) the maximum principal amount of the Money Market
Loan which the quoting Bank is willing to make for the
applicable Interest Period, which principal amount (x) may be
greater than or less than the
22
Commitment of the quoting Bank, (y) shall be at least
$1,000,000 or a larger multiple of $1,000,000, and (z) may not
exceed the principal amount of the Money Market Borrowing for
which offers were requested;
(C) the rate of interest per annum (rounded, if
necessary, to the nearest 1/100th of 1%) (the "Money Market
Rate") offered for each such Money Market Loan; and
(D) the identity of the quoting Bank.
Unless otherwise agreed by the Agent and the relevant Borrower, no Money Market
Quote shall contain qualifying, conditional or similar language or propose terms
other than or in addition to those set forth in the applicable Money Market
Quote Request (other than setting forth the maximum principal amount of the
Money Market Loan which the quoting Bank is willing to make for the applicable
Interest Period).
(d) The Agent shall as promptly as practicable after the Money
Market Quote is submitted (but in any event not later than 10:30 A.M. (Atlanta,
Georgia time) notify the relevant Borrower of the terms (i) of any Money Market
Quote submitted by a Bank that is in accordance with Section 2.03(c) and (ii) of
any Money Market Quote that amends, modifies or is otherwise inconsistent with a
previous Money Market Quote submitted by such Bank with respect to the same
Money Market Quote Request. Any such subsequent Money Market Quote shall be
disregarded by the Agent unless such subsequent Money Market Quote is submitted
solely to correct a manifest error in such former Money Market Quote. The
Agent's notice to the relevant Borrower shall specify (A) the maximum aggregate
principal amount of the Money Market Borrowing for which offers have been
received and (B) the maximum principal amount and Money Market Rates so offered
by each Bank (identifying the Bank that made each Money Market Quote).
(e) Not later than 11:00 A.M. (Atlanta, Georgia time) on the
Quotation Date (or such other time and date as the relevant Borrower and the
Agent, with the consent of the Required Banks, may agree), the relevant Borrower
shall notify the Agent of its acceptance or nonacceptance of the offers so
notified to it pursuant to Section 2.03(d) and the Agent shall promptly notify
each Bank that has submitted a Money Market Quote. In the case of acceptance,
such notice shall specify the aggregate principal amount of offers for each
Interest Period that are accepted. The relevant Borrower may accept any Money
Market Quote in whole or in part (provided that any Money Market Quote accepted
in part from any Bank shall not be less than the amount set forth in the Money
Market Quote of such Bank as the minimum principal amount of the Money Market
Loan such Bank was willing to make for the applicable Interest Period); provided
that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the
related Money Market Quote Request;
23
(ii) the aggregate principal amount of each Money Market
Borrowing shall be at least $5,000,000 (and in larger multiples of
$1,000,000) but shall not cause the limits specified in Section
2.03(a) to be violated;
(iii) acceptance of offers may only be made in ascending order
of Money Market Rates; and
(iv) the relevant Borrower may not accept any offer where the
Agent has advised such Borrower that such offer fails to comply with
Section 2.03(c)(ii) or otherwise fails to comply with the
requirements of this Agreement (including, without limitation,
Section 2.03(a)).
If offers are made by two or more Banks with the same Money Market Rates for a
greater aggregate principal amount than the amount in respect of which offers
are accepted for the related Interest Period, the principal amount of Money
Market Loans in respect of which such offers are accepted shall be allocated by
the relevant Borrower among such Banks as nearly as possible (in multiples of
$100,000) in proportion to the aggregate principal amount of such offers.
Determinations by the relevant Borrower of the amounts of Money Market Loans
shall be conclusive in the absence of manifest error.
(f) Any Bank whose offer to make any Money Market Loan has been
accepted shall, not later than 12:00 noon (Atlanta, Georgia time) on the
Quotation Date, make the amount of such Loan available to the Agent at its
address referred to in Section 9.01 in immediately available funds. The amount
so received by the Agent shall, subject to the terms and conditions of this
Agreement, be made available to the relevant Borrower on such date by depositing
the same, in immediately available funds, in an account of such Borrower
maintained with Wachovia.
SECTION 2.04. Notes. (a) The Syndicated Dollar Loans of each Bank
shall be evidenced by a single Syndicated Dollar Note and the Syndicated Foreign
Currency Loans of each Bank shall be evidenced by a single Syndicated Foreign
Currency Note, each payable to the order of such Bank for the account of its
Lending Office in an amount equal to the original principal amount of such
Bank's Commitment.
(b) The Money Market Loans made by any Bank to any Borrower shall be
evidenced by a single Money Market Note payable to the order of such Bank for
the account of its Lending Office.
(c) Upon receipt of each Bank's Notes pursuant to Section 3.01, the
Agent shall deliver such Notes to such Bank. Each Bank shall record, and prior
to any transfer of its Notes shall endorse on the schedule forming a part
thereof appropriate notations to evidence, the date, amount and maturity of, and
effective interest rate for, and the Borrower of, each Loan made by it, the date
and amount of each payment of principal made by the Borrowers with respect
thereto and whether, in the case of such Bank's
24
Syndicated Dollar Note, such Syndicated Dollar Loan is a Base Rate Loan or
Euro-Dollar Loan, and, in the case of such Bank's Syndicated Foreign Currency
Note, specification of the Foreign Currency, and such schedule shall constitute
rebuttable presumptive evidence of the principal amount owing and unpaid on such
Bank's Notes; provided that the failure of any Bank to make, or any error in
making, any such recordation or endorsement shall not affect the obligation of
the Borrowers hereunder or under the Notes or the ability of any Bank to assign
its Notes. Each Bank is hereby irrevocably authorized by the Borrowers so to
endorse its Notes and to attach to and make a part of any Note a continuation of
any such schedule as and when required. In order to verify the Loans outstanding
from time to time, the Agent shall furnish the Parent, upon request of the
Parent, with a copy of its record of transactions under this Agreement.
SECTION 2.05. Maturity of Loans. Each Loan included in any Borrowing
shall mature, and the principal amount thereof shall be due and payable, on the
last day of the Interest Period applicable to such Borrowing.
SECTION 2.06. Interest Rates. (a) "Applicable Margin" means:
(i) for the period commencing on the Closing Date to and including
the first Performance Pricing Determination Date, (x) for any Base Rate
Loan, 0.00%, (y) for any Euro-Dollar Loan, 0.65%, and (z) for any
Syndicated Foreign Currency Loan, 0.65%; and
(ii) from and after the first Performance Pricing Determination
Date, (x) for any Base Rate Loan, 0.00%, and (y) for each Euro-Dollar Loan
and Syndicated Foreign Currency Loan, the per annum percentage determined
on each Performance Pricing Determination Date by reference to the table
set forth below, based upon the ratio of Consolidated Debt to Consolidated
EBITDA (calculated as of the last day of each Fiscal Quarter) or, but only
if the Parent has Rated Debt outstanding, the Debt Rating:
- ------------------ --------------- ---------------- ------------------ -------------------
Ratio of < 1.75 to 1.00 > 1.75 to 1.00 > 2.25 to 1.00 > 2.75 to 1.00
- - -
Consolidated and <2.25 to and <2.75 to
Debt to 1.00 1.00
Consolidated
EBITDA
- ------------------ --------------- ---------------- ------------------ -------------------
Debt Rating Level 1 Level 2 Level 3 Level 4
- ------------------ --------------- ---------------- ------------------ -------------------
Applicable .35% .55% .65% .875%
Margin
- ------------------ --------------- ---------------- ------------------ -------------------
provided, that if on any Performance Pricing Determination Date on which the
Parent has Rated Debt outstanding (i) application of the Consolidated Debt to
Consolidated EBITDA ratio test only would result in a lower Applicable Margin
than application of the Debt Rating test only, the Applicable Margin shall be
determined based upon the Level next lower than the Level determined based upon
the Debt Rating test only, and (ii) if the Debt Rating received from any of (A)
Duff & Phelps is "BB" or lower, (B) Fitch is "B" or lower, (C) Moody's is "Ba2"
or lower, and (D) S&P is "BB" or lower, then the Applicable Margin shall be
1.05%.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the Base Rate for such day plus the
Applicable Margin. Such interest shall be
25
payable for each Interest Period on the last day thereof. Any overdue principal
of and, to the extent permitted by applicable law, overdue interest on any Base
Rate Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the sum of the Applicable Margin plus the applicable Adjusted
London Interbank Offered Rate for such Interest Period; provided that if any
Euro-Dollar Loan shall, as a result of clause (1)(c) of the definition of
Interest Period, have an Interest Period of less than one month, such
Euro-Dollar Loan shall bear interest during such Interest Period at the rate
applicable to Base Rate Loans during such period. Such interest shall be payable
for each Interest Period on the last day thereof and, if such Interest Period is
longer than 3 months, at intervals of 3 months after the first day thereof. Any
overdue principal of and, to the extent permitted by applicable law, overdue
interest on any Euro-Dollar Loan shall bear interest, payable on demand, for
each day until paid at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100th of 1%) by dividing (i) the
applicable London Interbank Offered Rate for such Interest Period by (ii) 1.00
minus the Euro-Dollar Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Euro-Dollar
Loan means for the Interest Period of such Euro-Dollar Loan the rate per annum
determined on the basis of the rate for deposits in Dollars of amounts equal or
comparable to the principal amount of such Euro-Dollar Loan offered for a term
comparable to such Interest Period, which rate appears on the display designated
as Page "3750" of the Telerate Service (or such other page as may replace page
3750 of that service or such other service or services as may be nominated by
the British Banker's Association for the purpose of displaying London Interbank
Offered Rates for U.S. dollar deposits) determined as of 1:00 p.m. New York City
time, 2 Euro-Dollar Business Days prior to the first day of such Interest
Period.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents). The Adjusted London Interbank Offered Rate
shall be adjusted automatically on and as of the effective date of any change in
the Euro-Dollar Reserve Percentage.
(d) Each Syndicated Foreign Currency Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin plus the
applicable Adjusted IBOR Rate for such Interest Period. Such interest shall be
payable for each Interest Period on the last day thereof and, if such
26
Interest Period is longer than 3 months, at intervals of 3 months after the
first day thereof. Any overdue principal of and, to the extent permitted by law,
overdue interest on any Syndicated Foreign Currency Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the
Default Rate.
"Adjusted IBOR Rate" means, with respect to each Interest Period for
a Syndicated Foreign Currency Loan, the sum (without duplication) of (i) the
rate obtained by dividing (A) IBOR for such Interest Period by (B) a percentage
equal to 1 minus the then stated maximum rate (stated as a decimal) of all
reserve requirements in respect of any category of liabilities by reference to
which the interest rate on such Syndicated Foreign Currency Loan is determined
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) applicable to any member bank of the Federal Reserve System
as defined in Regulation D (or against any successor category of liabilities as
defined in Regulation D), plus (ii) if the relevant Syndicated Foreign Currency
Loan is in Sterling, a percentage sufficient to compensate the Banks for the
cost of complying with any reserves, liquidity and/or special deposit
requirements of the Bank of England directly or indirectly affecting the
maintenance or funding of such Syndicated Foreign Currency Loan.
"IBOR" means, for any Interest Period, with respect to Syndicated
Foreign Currency Loans, the offered rate for deposits in the applicable Foreign
Currency, for a period comparable to the Interest Period and in an amount
comparable to the amount of such Syndicated Foreign Currency Loan appearing on
the applicable Telerate Page as of 11:00 A.M. (London, England time) on the day
that is two Business Days prior to the first day of the Interest Period. If the
foregoing rate is unavailable from Telerate for any reason, then such rate shall
be determined by the Agent from any other interest rate reporting service of
recognized standing designated in writing by the Agent to the Parent and the
Banks.
(e) Each Money Market Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the Money Market Rate for such Loan quoted by the Bank making
such Loan in accordance with Section 2.03. Such interest shall be payable for
such Interest Period on the last day thereof and, if such Interest Period is
longer than 90 days, at intervals of 90 days after the first day thereof. Any
overdue principal of and, to the extent permitted by law, overdue interest on
any Money Market Loan shall bear interest, payable on demand, for each day until
paid at a rate per annum equal to the Default Rate.
(f) The Agent shall determine in accordance with this Agreement each
interest rate applicable to the Loans hereunder. The Agent shall give prompt
notice to the relevant Borrower and the Banks by telecopy of each rate of
interest so determined, and its determination thereof shall be conclusive in the
absence of manifest error.
(g) After the occurrence and during the continuance of an Event of
Default, the principal amount of the Loans (and, to the extent permitted by
applicable law, all accrued interest thereon) may, at the election of the
Required Banks, bear interest at the Default Rate.
27
SECTION 2.07. Fees. (a) The Borrowers shall pay to the Agent for the
ratable account of each Bank a facility fee (the "Facility Fee") on the maximum
amount of the aggregate Commitments in effect for any relevant period,
irrespective of usage, at a rate per annum equal to the Applicable Facility Fee
Rate. "Applicable Facility Fee Rate" means (i) for the period commencing on the
Closing Date to and including the first Performance Pricing Determination Date,
0.225%; and (ii) from and after the first Performance Pricing Determination
Date, the percentage determined on each Performance Pricing Determination Date
by reference to the table set forth below, based upon the ratio of Consolidated
Debt to Consolidated EBITDA (calculated as of the last day of each Fiscal
Quarter) or, but only if the Parent has Rated Debt outstanding, the Debt Rating:
- ------------------ --------------- ---------------- ------------------ -------------------
Ratio of < 1.75 to 1.00 > 1.75 to 1.00 > 2.25 to 1.00 > 2.75 to 1.00
- - -
Consolidated and <2.25 to and <2.75 to
Debt to 1.00 1.00
Consolidated
EBITDA
- ------------------ --------------- ---------------- ------------------ -------------------
Debt Rating Level 1 Level 2 Level 3 Level 4
- ------------------ --------------- ---------------- ------------------ -------------------
Applicable .15% .20% .225% .25%
Facility Fee
Rate
- ------------------ --------------- ---------------- ------------------ -------------------
provided, that if on any Performance Pricing Determination Date on which the
Parent has Rated Debt outstanding (i) application of the Consolidated Debt to
Consolidated EBITDA ratio test only would result in a lower Applicable Facility
Fee Rate than application of the Debt Rating test only, the Applicable Facility
Fee Rate shall be determined based upon the Level next lower than the Level
determined based upon the Debt Rating test only, and (ii) if the Debt Rating
received from any of (A) Duff & Phelps is "BB" or lower, (B) Fitch is "B" or
lower, (C) Moody's is "Ba2" or lower, and (D) S&P is "BB" or lower, then the
Applicable Facility Fee Rate shall be .325%. The Facility Fee shall accrue at
all times from and including the Closing Date to but excluding the Termination
Date and shall be payable, in arrears, on each Facility Fee Payment Date and on
the Termination Date.
(b) In determining the Applicable Margin and the Applicable Facility
Fee Rate, the Agent and the Banks shall refer to the most recent financial
statements of the Parent and its Consolidated Subsidiaries delivered to the
Banks pursuant to Section 5.01(a) (together with the Compliance Certificate
delivered in connection therewith, the "Audited Statements") and Section 5.01(b)
(together with the Compliance Certificate delivered in connection therewith, the
"Unaudited Statements") and, if the Parent has Rated Debt outstanding, the Debt
Ratings in effect from time to time. For purposes hereof, "Performance Pricing
Determination Date" shall mean (i) each date that occurs 45 days after the end
of each of the first 3 Fiscal Quarters, and 90 days after the end of the last
Fiscal Quarter, or, if applicable, (ii) each date on which the Debt
28
Rating changes. Each change in interest and fees as a result of a change in Debt
Rating or as a result of a change in the ratio of Consolidated Debt to
Consolidated EBITDA as reflected in the Audited Statements or the Unaudited
Statements shall be effective only for Syndicated Loans (including Refunding
Loans) which are made on or after the relevant Performance Pricing Determination
Date. All determinations hereunder shall be made by the Agent unless the
Required Banks shall object to any such determination. The Parent shall promptly
notify the Agent of any change in the Debt Rating.
(c) The Parent shall pay to the Agent, on the Closing Date, for the
account of each Bank, the up front fees in such amounts as have previously been
agreed by the Parent, the Agent and the Banks.
(d) The Borrowers shall pay to the Agent, for the account and sole
benefit of the Agent, such fees and other amounts at such times as set forth in
the Agent's Letter Agreement.
SECTION 2.08. Optional Termination or Reduction of Commitments. The
Parent may, upon at least 3 Domestic Business Days' notice to the Agent,
terminate at any time, or proportionately permanently reduce from time to time
by an aggregate amount of at least $5,000,000 or any larger multiple of
$1,000,000, the Commitments; provided, however, no such termination or reduction
shall be in an amount greater than the Total Unused Commitments on the date of
such termination or reduction. If the Commitments are terminated in their
entirety, all accrued fees (as provided under Section 2.07) shall be payable on
the effective date of such termination.
SECTION 2.09. Mandatory Termination of Commitments. The Commitments
shall terminate on the Termination Date and any Loans then outstanding (together
with accrued interest thereon) shall be due and payable on such date.
SECTION 2.10. Optional Prepayments. (a) A Borrower may, upon at
least 1 Domestic Business Day's notice to the Agent, prepay any Base Rate
Borrowing made by such Borrower in whole at any time, or from time to time in
part in amounts aggregating at least $1,000,000, or any larger multiple of
$500,000, by paying the principal amount to be prepaid together with accrued
interest thereon to the date of prepayment. Each such optional prepayment shall
be applied to prepay ratably the Base Rate Loans of the several Banks included
in such Base Rate Borrowing.
(b) Except as provided in Section 8.02, no Borrower may prepay all
or any portion of the principal amount of any Fixed Rate Loan or any Money
Market Loan prior to the last day of an Interest Period applicable thereto.
(c) Upon receipt of a notice of prepayment pursuant to this Section,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such prepayment and such notice shall not thereafter be
revocable by any Borrower.
29
SECTION 2.11. Mandatory Prepayments. (a) On each date on which the
Commitments are reduced or terminated pursuant to Section 2.08 or Section 2.09,
the Borrowers shall repay or prepay such principal amount of the outstanding
Loans, if any (together with interest accrued thereon and any amounts due under
Section 8.05(a)), as may be necessary so that after such payment the aggregate
unpaid principal amount of the Loans does not exceed the aggregate amount of the
Commitments as then reduced. Each such payment or prepayment shall be applied to
repay or prepay ratably the Loans of the several Banks; provided that such
prepayment shall be applied, first, to Syndicated Loans outstanding on the date
of such prepayment (in direct order of maturity) and then, to the extent
necessary, to Money Market Loans outstanding on the date of such prepayment (in
direct order of maturity).
(b) If the Agent determines at any time (either on its own
initiative or at the instance of any Bank) that the aggregate principal amount
of the Syndicated Foreign Currency Loans outstanding (after converting each such
Syndicated Foreign Currency Loan to its Dollar Equivalent on the date of
calculation) at any time exceeds the aggregate Commitments less the outstanding
aggregate amount of all Syndicated Dollar Loans and all Money Market Loans, then
upon 5 Foreign Currency Business Days' written notice from the Agent, the Parent
shall prepay an aggregate principal amount of Loans sufficient to bring the
aggregate of the Dollar Equivalent of the Syndicated Foreign Currency Loans, the
Syndicated Dollar Loans and the Money Market Loans outstanding to an amount not
exceeding the aggregate Commitments. Nothing in the foregoing shall require the
Agent to make any such calculation unless expressly requested to do so by the
Required Banks. All such prepayments shall be applied in the following order:
(i) first to Base Rate Loan; (ii) then to Euro-Dollar Loans; and (iii) then, to
Syndicated Foreign Currency Loans, and (iv) lastly, to Money Market Loans.
SECTION 2.12. General Provisions as to Payments. (a) The Borrowers
shall make each payment of principal of, and interest on, the Loans and of
facility fees hereunder, not later than 1:00 P.M. (Atlanta, Georgia time) on the
date when due, in Federal or other funds (subject to paragraph (c) of this
Section with respect to Syndicated Foreign Currency Loans) immediately available
in Atlanta, Georgia, to the Agent at its address referred to in Section 9.01.
The Agent will promptly distribute to each Bank its ratable share of each such
payment received by the Agent for the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the Base
Rate Loans or the Money Market Loans or of fees shall be due on a day which is
not a Domestic Business Day, the date for payment thereof shall be extended to
the next succeeding Domestic Business Day. Whenever any payment of principal of,
or interest on, the Euro-Dollar Loans or Foreign Currency Loans shall be due on
a day which is not a Euro-Dollar Business Day or a Foreign Currency Business
Day, as the case may be, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day or Foreign Currency Business Day, as
the case may be, unless such Euro-Dollar Business Day or Foreign Currency
Business Day, as the case may be, falls in another calendar month, in which case
the date for payment thereof shall be the next preceding Euro-Dollar Business
Day or Foreign Currency Business Day, as the case may be. If
30
the date for any payment of principal is extended by operation of law or
otherwise, interest thereon shall be payable for such extended time.
(c) All payments of principal and interest with respect to
Syndicated Foreign Currency Loans shall be made in the Foreign Currency in which
the related Syndicated Foreign Currency Loan was made.
(d) All payments of principal, interest and fees and all other
amounts to be made by the Borrowers pursuant to this Agreement with respect to
any Loan or fee relating thereto shall be paid without deduction for, and free
from, any tax, imposts, levies, duties, deductions, or withholdings of any
nature now or at anytime hereafter imposed by any governmental authority or by
any taxing authority thereof or therein excluding in the case of each Bank,
taxes imposed on or measured by its net income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Bank is organized or any
political subdivision thereof and, in the case of each Bank, taxes imposed on
its income, and franchise taxes imposed on it, by the jurisdiction of such
Bank's applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, imposts, levies, duties, deductions or withholdings of any
nature being "Taxes"). In the event that any Borrower is required by applicable
law to make any such withholding or deduction of Taxes with respect to any Loan
or fee or other amount, such Borrower shall pay such deduction or withholding to
the applicable taxing authority, shall promptly furnish to any Bank in respect
of which such deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Bank additional amounts as may be
necessary in order that the amount received by such Bank after the required
withholding, deduction or other payment (including any withholding, deduction or
other payment in respect of additional sums payable under this Section 2.12(d))
shall equal the amount such Bank would have received had no such withholding or
other payment been made. If no withholding or deduction of Taxes are payable in
respect of any Loan or fee relating thereto, such Borrower shall furnish any
Bank, at such Bank's request, a certificate from each applicable taxing
authority or an opinion of counsel acceptable to such Bank, in either case
stating that such payments are exempt from or not subject to withholding or
deduction of Taxes. If any Borrower fails to provide such original or certified
copy of a receipt evidencing payment of Taxes or certificate(s) or opinion of
counsel of exemption, such Borrower hereby agrees to compensate such Bank for,
and indemnify them with respect to, the tax consequences of such Borrower's
failure to provide evidence of tax payments or tax exemption.
Each Bank which is not organized under the laws of the United States
of America or a state thereof agrees, as soon as practicable after request by it
of a request by a Borrower to do so, to file all appropriate forms and take
other appropriate action to obtain a certificate or other appropriate document
from the appropriate governmental authority in the jurisdiction imposing the
relevant taxes, establishing that it is entitled to receive payments of
principal and interest under this Agreement and the Notes without deduction and
free from withholding of any Taxes imposed by such jurisdiction; provided, that,
if it is unable, for any reason, to establish such exemption, or to file such
forms and, in any event, during such period of time as such request for
exemption is pending, such Borrower shall nonetheless remain obligated under the
31
terms of the immediately preceding paragraph.
Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Borrowers contained in
this Section 2.12 shall be applicable with respect to any Participant, Assignee
or other Transferee, and any calculations required by such provisions (i) shall
be made based upon the circumstances of such Participant, Assignee or other
Transferee, and (ii) constitute a continuing agreement and shall survive the
termination of this Agreement and the payment in full or cancellation of the
Notes.
SECTION 2.13. Computation of Interest and Fees. Interest on Base
Rate Loans shall be computed on the basis of a year of 365 or 366 days, as the
case may be, and paid for the actual number of days elapsed (including the first
day but excluding the last day). Interest on Euro-Dollar Loans, Syndicated
Foreign Currency Loans and Money Market Loans shall be computed on the basis of
a year of 360 days (except for any Syndicated Foreign Currency Loans outstanding
in Sterling or Canadian Dollars, which shall be computed on the basis of 365 or
366 days, as the case may be) and paid for the actual number of days elapsed,
calculated as to each Interest Period from and including the first day thereof
to but excluding the last day thereof. Facility fees and any other fees payable
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to Closing. The Closing Date shall not
occur until the Agent has received each of the following (as to the documents
described in paragraphs (a), (c), (d), (e), (f) and (i) below in sufficient
number of counterparts for delivery of a counterpart to each Bank and retention
of one counterpart by the Agent):
(a) from each of the parties hereto of a duly executed counterpart
of this Agreement signed by such party;
(b) a duly executed (i) Syndicated Dollar Note, (ii) Syndicated
Foreign Currency Note and (iii) Money Market Note for the account of each Bank;
(c) from the Guarantors, a duly executed Guaranty;
(d) from the Borrowers and the Guarantors, a duly executed
Indemnity, Subrogation and Contribution Agreement;
(e) an opinion letter (together with any opinions of local counsel
relied on therein) of Lindquist & Vennum, PLLP, special counsel for the
Borrowers and the Guarantors, substantially in the form of Exhibit D, dated as
of the Closing Date, and covering such additional
32
matters relating to the transactions contemplated hereby as the Agent or any
Bank may reasonably request;
(f) an opinion of Womble Carlyle Sandridge & Rice, PLLC, special
counsel for the Agent, dated as of the Closing Date, substantially in the form
of Exhibit E and covering such additional matters relating to the transactions
contemplated hereby as the Agent may reasonably request;
(g) a certificate (the "Closing Certificate") substantially in the
form of Exhibit H, dated as of the Closing Date, signed by a principal financial
officer of the Parent, to the effect that (i) no Default has occurred and is
continuing on the Closing Date, (ii) the representations and warranties of the
Parent contained in Article IV are true on and as of the Closing Date and (iii)
since October 30, 1998, there has been no event, act, condition or occurrence
having a Material Adverse Affect;
(h) all documents which the Agent or any Bank may reasonably request
relating to the existence of the Borrowers and the Guarantors, the corporate
authority for and the validity of this Agreement, the Notes, the Guaranty, the
Indemnity, Subrogation and Contribution Agreement and the other Loan Documents
and any other matters relevant hereto or thereto, all in form and substance
reasonably satisfactory to the Agent, including, without limitation, an
Officer's Certificate of the Borrowers and the Guarantors substantially in the
form of Exhibit I, signed by the Secretary or an Assistant Secretary of the
Borrowers and the Guarantors, certifying as to the names, true signatures and
incumbency of the officer or officers, respectively, of the Borrowers and the
Guarantors, as applicable, authorized to execute and deliver the Loan Documents
or the Guaranty and the Indemnity, Subrogation and Contribution Agreement, as
applicable, and certified copies of the following items, for the Borrowers and
the Guarantors:
(i) Certificate/Articles of Incorporation;
(ii) Bylaws;
(iii) a Certificate of the Secretary of State of the state of
incorporation as to the good standing of each
corporation in such state; and
(iv) the action taken by the Board of Directors authorizing
the execution, delivery and performance of this
Agreement, the Note and the other Loan Documents, or the
Guaranty and the Indemnity, Subrogation and Contribution
Agreement, as applicable.
(i) copies of the Purchase Agreement and any material documents
relating to the Pending Acquisition;
(j) evidence satisfactory to the Agent and the Banks that all
conditions to the closing of the Pending Acquisition required to have been met
have been met or waived (with the
33
Agent's and the Banks' consent, which consent shall not be unreasonably
withheld), and that the Purchase Agreement is in full force and effect, and that
the consummation of the Pending Acquisition will occur immediately upon the
funding of the Loans under this Agreement; and
(k) evidence satisfactory to the Agent that the Existing Note shall
have been terminated and the Debt evidenced thereby repaid in full, or shall be
terminated and repaid simultaneously with the initial funding of the Loans
hereunder, in full.
SECTION 3.02. Conditions to All Borrowings. The obligation of each
Bank to make a Loan on the occasion of each Borrowing is subject to the
satisfaction of the following conditions:
(a) either (i) receipt by the Agent of Notice of Borrowing as
required by Section 2.02 (if such Borrowing is a Syndicated Borrowing), or (ii)
compliance with the provisions of Section 2.03 (if such Borrowing is a Money
Market Borrowing);
(b) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing;
(c) except in the case of Borrowings consisting solely of Refunding
Loans, the fact that the representations and warranties of the Parent contained
in Article IV of this Agreement shall be true on and as of the date of such
Borrowing; and
(d) the fact that, immediately after such Borrowing (i) the
aggregate outstanding principal amount of the Syndicated Loans of each Bank will
not exceed the amount of its Commitment and (ii) the aggregate outstanding
principal amount of the Loans will not exceed the aggregate amount of the
Commitments of all of the Banks as of such date.
Each Borrowing hereunder, other than a Borrowing which consists solely of
Refunding Loans, shall be deemed to be a representation and warranty by the
relevant Borrower on the date of such Borrowing as to the truth and accuracy of
the facts specified in clauses (b), (c) and (d) of this Section, except to the
extent they relate to a particular date only.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Parent represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Parent is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation, is duly qualified to transact business
in every jurisdiction where, by the nature of its business, the failure to be so
qualified could have or cause a Material Adverse Effect, and has
34
all corporate powers and all governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrowers of this
Agreement, the Notes and the other Loan Documents, and the execution by the
Guarantors of the Guaranty and the Indemnity, Subrogation and Contribution
Agreement (i) are within the Borrowers' and the Guarantors' respective corporate
powers, (ii) have been duly authorized by all necessary corporate action, (iii)
require no action by or in respect of or filing with, any governmental body,
agency or official, (iv) do not contravene, or constitute a default under, any
provision of applicable law or regulation or of the certificate of incorporation
or by-laws of the Parent or any Subsidiary or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Parent or any of
its Subsidiaries, and (v) do not result in the creation or imposition of any
Lien on any asset of the Parent or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a valid and
binding agreement of the Borrowers enforceable in accordance with its terms, and
the Notes and the other Loan Documents, and the Guaranty and Indemnity,
Subrogation and Contribution Agreement, when executed and delivered in
accordance with this Agreement, will constitute valid and binding obligations of
the Borrowers and the Guarantors, respectively, enforceable in accordance with
their respective terms, provided that the enforceability hereof and thereof is
subject in each case to general principles of equity and to bankruptcy,
insolvency and similar laws affecting the enforcement of creditors' rights
generally.
SECTION 4.04. Financial Information. (a) The balance sheet of the
Parent and the Consolidated Subsidiaries as of October 30, 1998 and the related
statements of income, shareholders' equity and cash flows for the Fiscal Year
then ended, reported on by Ernst & Young, copies of which have been delivered to
each of the Banks, fairly present, in conformity with GAAP, the consolidated
financial position of the Parent as of such date and their results of operations
and cash flows for such period stated.
(b) Since October 30, 1998, there has been no event, act, condition
or occurrence having a Material Adverse Effect.
SECTION 4.05. No Litigation. There is no action, suit or proceeding
pending, or to the knowledge of the Parent threatened, against or affecting the
Parent or any of its Subsidiaries before any court or arbitrator or any
governmental body, agency or official which could have a Material Adverse Effect
or which in any manner draws into question the validity of or could impair the
ability of any Borrower to perform its obligations under, this Agreement, the
Notes or any of the other Loan Documents or of any Guarantor to perform its
obligations under the Guaranty or the Indemnity, Subrogation and Contribution
Agreement.
SECTION 4.06. Compliance with ERISA. (a) The Parent and each member
of the Controlled Group have fulfilled their obligations under the minimum
funding standards of
35
ERISA and the Code with respect to each Plan and are in compliance in all
material respects with the presently applicable provisions of ERISA and the
Code, and have not incurred any liability to the PBGC or a Plan under Title IV
of ERISA.
(b) Neither the Parent nor any member of the Controlled Group has
incurred any withdrawal liability with respect to any Multiemployer Plan under
Title IV of ERISA, and no such liability is expected to be incurred.
SECTION 4.07. Compliance with Laws; Payment of Taxes. The Parent and
its Subsidiaries are in compliance in all material respects with all applicable
laws, regulations and similar requirements of governmental authorities, except
for the matters disclosed in Schedule 4.14 or where such compliance is being
contested in good faith through appropriate proceedings, except where the
failure to comply would not have or cause a Material Adverse Effect. There have
been filed on behalf of the Parent and its Subsidiaries all Federal, state and
local income, excise, property and other tax returns which are required to be
filed by them and all taxes due pursuant to such returns or pursuant to any
assessment received by or on behalf of the Parent or any Subsidiary have been
paid or are being contested in good faith by appropriate proceedings. The
charges, accruals and reserves on the books of the Parent and its Subsidiaries
in respect of taxes or other governmental charges are, in the opinion of the
Parent, adequate. United States income tax returns of the Parent and its
Subsidiaries have been examined and closed through the Fiscal Year ended October
28, 1994.
SECTION 4.08. Subsidiaries. Each of the Parent's Subsidiaries is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, is duly qualified to transact business in
every jurisdiction where, by the nature of its business, such qualification is
necessary, and has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted, except where the failure to qualify or have any such license,
authorization, consent or approval would not have or cause a Material Adverse
Effect. The Parent has no Subsidiaries except for those Subsidiaries listed on
Schedule 4.08, or as described in a Compliance Certificate furnished pursuant to
Section 5.01(c), in each case which accurately sets forth each such Subsidiary's
complete name and jurisdiction of incorporation.
SECTION 4.09. Investment Company Act. Neither the Parent nor any of
its Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
SECTION 4.10. Public Utility Holding Company Act. Neither the Parent
nor any of its Subsidiaries is a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each of the Parent and
its Consolidated Subsidiaries has title to its properties sufficient for the
conduct of its business, and
36
none of such property is subject to any Lien except as permitted in Section
5.08.
SECTION 4.12. No Default. Neither the Parent nor any of its
Consolidated Subsidiaries is in default under or with respect to any agreement,
instrument or undertaking to which it is a party or by which it or any of its
property is bound which could have or cause a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore furnished
by the Parent or any Subsidiary to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Parent or any Subsidiary to the
Agent or any Bank will be, true, accurate and complete in every material respect
or based on reasonable estimates on the date as of which such information is
stated or certified.
SECTION 4.14. Environmental Matters. (a) Except for the matters
disclosed in Schedule 4.14, neither the Parent nor any Subsidiary is subject to
any Environmental Liability which could have or cause a Material Adverse Effect
and neither the Parent nor any Subsidiary has been designated as a potentially
responsible party under CERCLA or under any state statute similar to CERCLA. To
the best knowledge of the Parent, except for the matters disclosed in Schedule
4.14, none of the Properties has been identified on any current or proposed (i)
National Priorities List under 40 C.F.R. ss. 300, (ii) CERCLIS list or (iii) any
list arising from a state statute similar to CERCLA.
(b) Except for the matters disclosed in Schedule 4.14, no Hazardous
Materials have been or are being used, produced, manufactured, processed,
treated, recycled, generated, stored, disposed of, managed or otherwise handled
at, or shipped or transported to or from the Properties or are otherwise present
at, on, in or under the Properties, or, to the best of the knowledge of the
Parent, at or from any adjacent site or facility, except for Hazardous Materials
used or otherwise handled, to the best knowledge of the Parent, in the ordinary
course of business in compliance with all applicable Environmental Requirements,
except where the failure to comply would not have or cause a Material Adverse
Effect.
(c) Except for the matters disclosed in Schedule 4.14, the Parent,
and each of its Subsidiaries and Affiliates, has procured all Environmental
Authorizations necessary for the conduct of its business, and, to the best
knowledge of the Parent, is in compliance with all Environmental Requirements in
connection with the operation of the Properties and the Parent's, and each of
its Subsidiary's and Affiliate's, respective businesses, except where the
failure to comply would not have or cause a Material Adverse Effect.
SECTION 4.15. Capital Stock. All Capital Stock, debentures, bonds,
notes and all other securities of the Parent and its Subsidiaries presently
issued and outstanding are validly and properly issued. All outstanding
securities (whether debt or equity) of the Parent and its Subsidiaries were
registered under the federal and any applicable state securities laws or were
issued in transactions which were exempt from registration under such laws;
provided, that as to any Subsidiary acquired but not created by the Parent, the
foregoing is made to the best of the
37
Parent's knowledge. The issued shares of Capital Stock of the Parent's Wholly
Owned Subsidiaries are owned by the Parent free and clear of any Lien or adverse
claim. At least a majority of the issued shares of capital stock of each of the
Parent's other Subsidiaries (other than Wholly Owned Subsidiaries) is owned by
the Parent, and all such shares owned by the Parent are free and clear of any
Lien or adverse claim.
SECTION 4.16. Margin Stock. Neither the Parent nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of purchasing or carrying any Margin Stock, and no part of the
proceeds of any Loan will be used to purchase or carry any Margin Stock or to
extend credit to others for the purpose of purchasing or carrying any Margin
Stock, or be used for any purpose which violates, or which is inconsistent with,
the provisions of Regulation X.
SECTION 4.17. Insolvency. After giving effect to the execution and
delivery of the Loan Documents and the making of the Loans under this Agreement,
no Borrower will be "insolvent," within the meaning of such term as defined in
ss. 101 of Title 11 of the United States Code or Section 2 of the Uniform
Fraudulent Transfer Act, or any other applicable state law pertaining to
fraudulent transfers, as each may be amended from time to time, or be unable to
pay its debts generally as such debts become due, or have an unreasonably small
capital to engage in any business or transaction, whether current or
contemplated.
SECTION 4.18. Compliance with Year 2000 Plan. The Parent has
developed and has delivered to the Agent a comprehensive plan (the "Y2K Plan")
for ensuring that the Parent's and its existing Subsidiaries' (excluding, on any
date this representation is made or deemed made on or prior to March 31, 1999,
those Persons becoming Subsidiaries of the Parent as a result of the Pending
Acquisition) software and hardware systems which materially affect the business
operations of the Parent and its Subsidiaries will be Year 2000 Ready. The Y2K
Plan includes alternative plans to ensure business continuity in the event the
Parent and its Subsidiaries are not Year 2000 Ready.
ARTICLE V
COVENANTS
The Parent agrees that, so long as any Bank has any Commitment
hereunder or any amount payable hereunder or under any Note remains unpaid:
SECTION 5.01. Information. The Parent will deliver to each of the
Banks:
(a) as soon as available and in any event within 90 days after the
end of each Fiscal Year, a consolidated balance sheet of the Parent and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of income, shareholders' equity and cash flows for such
Fiscal Year, setting forth in each case in comparative form the figures for the
previous fiscal year, all certified by Ernst & Young or other independent public
accountants
38
of nationally recognized standing, with such certification to be free of
exceptions and qualifications not acceptable to the Required Banks;
(b) as soon as available and in any event within 45 days after the
end of each of the first 3 Fiscal Quarters of each Fiscal Year, a consolidated
balance sheet of the Parent and its Consolidated Subsidiaries as of the end of
such Fiscal Quarter and the related statement of income and statement of cash
flows for such Fiscal Quarter and for the portion of the Fiscal Year ended at
the end of such Fiscal Quarter, setting forth in each case in comparative form
the figures for the corresponding Fiscal Quarter and the corresponding portion
of the previous Fiscal Year, all certified (subject to normal year-end
adjustments) as to fairness of presentation, GAAP and consistency by the chief
financial officer, the treasurer or the chief accounting officer of the Parent;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate,
substantially in the form of Exhibit J (a "Compliance Certificate"), of the
chief financial officer, the treasurer or the chief accounting officer of the
Parent (i) setting forth in reasonable detail the calculations required to
establish whether the Parent was in compliance with the requirements of Sections
5.03, 5.04, 5.08 and 5.11(d) on the date of such financial statements, (ii)
stating whether any Default exists on the date of such certificate and, if any
Default then exists, setting forth the details thereof and the action which the
Parent is taking or proposes to take with respect thereto, (iii) containing the
certification required by Section 5.01(b), and (iv) listing any new Subsidiaries
not listed on Schedule 4.08 or in any prior Compliance Certificate;
(d) simultaneously with the delivery of each set of annual financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements to the effect
that nothing has come to their attention to cause them to believe that any
Default under any of Sections 5.03, 5.04 and 5.11(d) existed on the date of such
financial statements;
(e) within 5 Domestic Business Days after the chief executive
officer, chief operating officer, chief financial officer, chief accounting
officer or treasurer of the Parent becomes aware of the occurrence of any
Default, a certificate of the chief financial officer, treasurer or the chief
accounting officer of the Parent setting forth the details thereof and the
action which the Parent is taking or proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the
Parent generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and annual, quarterly or monthly reports which the
Parent shall have filed with the Securities and Exchange Commission;
(h) if and when the Parent or any member of the Controlled Group (i)
gives or
39
is required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA, a copy of such notice; or (iii)
receives notice from the PBGC under Title IV of ERISA of an intent to terminate
or appoint a trustee to administer any Plan, a copy of such notice;
(i) promptly after the Parent knows of the commencement thereof,
notice of any litigation or other legal proceeding involving a claim against the
Parent and/or any Subsidiary for $10,000,000 or more in excess of amounts
covered in full by applicable insurance;
(j) simultaneously with the delivery of each set of annual and
quarterly financial statements referred to in clauses (a) and (b) above, a
statement of the chief executive officer, treasurer, chief financial officer, or
chief technology officer of the Parent (i) to the effect that nothing has come
to his/her attention to cause him/her to believe that the Parent's and its
Subsidiaries' hardware and software systems will not be Year 2000 Ready in
accordance with the Y2K Plan, or (ii) describing any facts or circumstances that
prevent the statement described in clause (i) of this paragraph from being made;
(k) within 10 Business Days after the chief executive officer, chief
operating officer, chief financial officer, chief technology officer or
treasurer of the Parent becomes aware of any material deviations from the Y2K
Plan which would cause completion of the Y2K Plan to be delayed or not achieved
in any significant respect, a statement of the chief executive officer,
treasurer, chief financial officer, or chief technology officer of the Parent
setting forth the details thereof and the action which the Parent is taking or
proposes to take with respect thereto; and
(l) from time to time such additional information regarding the
financial position or business of the Parent and its Subsidiaries as the Agent,
at the request of any Bank, may reasonably request.
SECTION 5.02. Inspection of Property, Books and Records. The Parent
will (i) keep, and will cause each Subsidiary to keep, proper books of record
and account in which full, true and correct entries in conformity with GAAP
shall be made of all dealings and transactions in relation to its business and
activities; and (ii) permit, and will cause each Subsidiary to permit,
representatives of any Bank at such Bank's expense prior to the occurrence of an
Event of Default and at the Parent's expense after the occurrence of an Event of
Default to visit and inspect any of their respective properties, to examine and
make abstracts from any of their respective books and records and to discuss
their respective affairs, finances and accounts with their respective officers,
employees and independent public accountants. The Parent agrees to cooperate and
assist in such visits and inspections, in each case at such reasonable times and
as often as may reasonably be desired.
40
SECTION 5.03. Ratio of Consolidated Debt to Consolidated EBITDA. The
ratio of Consolidated Debt to Consolidated EBITDA for the period of 4
consecutive Fiscal Quarters most recently ended will not at any time exceed 3.50
to 1.00.
SECTION 5.04. Minimum Shareholders' Equity. Shareholders' Equity
will at no time be less than $257,234,000 plus the sum of (i) 50% of the
cumulative Reported Net Income of the Parent and its Consolidated Subsidiaries
during any period after July 31, 1998 (taken as one accounting period),
calculated quarterly but excluding from such calculations of Reported Net Income
for purposes of this clause (i) any quarter in which the Consolidated Net Income
of the Parent and its Consolidated Subsidiaries is negative, and (ii) 100% of
the cumulative Net Proceeds of Capital Stock/Conversion of Debt received during
any period after the Closing Date, calculated quarterly.
SECTION 5.05. Restricted Payments. The Parent will not declare or
make any Restricted Payment during any Fiscal Year, except for stock repurchases
and dividends approved by the Board of Directors of the Parent.
SECTION 5.06. Loans or Advances. Neither the Parent nor any of its
Subsidiaries shall make loans or advances to any Person except: (i) loans or
advances to employees not exceeding Ten Million Dollars ($10,000,000) in the
aggregate outstanding made in the ordinary course of business; (ii) deposits
required by government agencies or public utilities; (iii) loans or advances to
any Borrower or Guarantor; (iv) Prepaid Rebates; (v) loans or advances to
Subsidiaries made to consummate the Pending Acquisition; and (vi) loans,
advances or deposits other than those permitted by clauses (i) through (v) of
this Section not exceeding 10% of Consolidated Total Assets in the aggregate
outstanding, provided that after giving effect to the making of any loans,
advances or deposits permitted by clause (i), (ii), (iii), (iv), (v) or (vi) of
this Section, no Default shall have occurred and be continuing.
SECTION 5.07. Acquisitions. Neither the Parent nor any of its
Subsidiaries shall make any Acquisitions, provided, that Permitted Acquisitions
may be made if, after giving effect thereto, no Default or Event of Default
would be caused thereby (giving effect thereto on a pro forma basis as to
financial covenants).
SECTION 5.08. Negative Pledge. Neither the Parent nor any
Consolidated Subsidiary will create, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal amount not
exceeding $10,000,000;
(b) any Lien existing on any asset of any corporation at the time
such corporation becomes a Consolidated Subsidiary and not created in
contemplation of such event;
41
(c) any Lien on any asset securing Debt incurred or assumed for the
purpose of financing all or any part of the cost of acquiring or constructing
such asset, provided that such Lien attaches to such asset concurrently with or
within 18 months after the acquisition or completion of construction thereof;
(d) any Lien on any asset of any corporation existing at the time
such corporation is merged or consolidated with or into the Parent or a
Consolidated Subsidiary and not created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition thereof
by the Parent or a Consolidated Subsidiary and not created in contemplation of
such acquisition;
(f) Liens securing Debt owing by any Subsidiary to any Borrower or
Guarantor;
(g) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the foregoing
clauses of this Section, provided that (i) such Debt is not secured by any
additional assets, and (ii) the amount of such Debt secured by any such Lien is
not increased;
(h) Liens incidental to the conduct of its business or the ownership
of its assets which (i) do not secure Debt and (ii) do not in the aggregate
materially detract from the value of its assets or materially impair the use
thereof in the operation of its business;
(i) any Lien on Margin Stock; and
(j) Liens not otherwise permitted by the foregoing clauses of this
Section securing Debt (other than indebtedness represented by the Notes) in an
aggregate principal amount at any time outstanding which, together with the
amount of Debt secured by Liens permitted by the foregoing paragraphs (a)
through (i), does not exceed 10% of Consolidated Total Assets.
SECTION 5.09. Maintenance of Existence. The Parent shall, and shall
cause each Guarantor and each other Borrower to, maintain its corporate
existence and carry on its business in substantially the same manner and in
substantially the same fields as such business is now carried on and maintained,
except through corporate reorganization to the extent permitted by Section 5.11.
SECTION 5.10. Dissolution. Neither the Parent, any Guarantor, nor
any other Borrower shall suffer or permit dissolution or liquidation either in
whole or in part or redeem or retire any shares of its own stock or that of any
Subsidiary, except (i) through corporate reorganization to the extent permitted
by Section 5.11 or (ii) Restricted Payments permitted by Section 5.05.
42
SECTION 5.11. Consolidations, Mergers and Sales of Assets. The
Parent will not, nor will it permit any Subsidiary to, consolidate or merge with
or into, or sell, lease or otherwise transfer all or any substantial part of its
assets to, any other Person, or discontinue or eliminate any business line or
segment, provided that (a) the Parent may merge with another Person if (i) such
Person was organized under the laws of the United States of America or one of
its states, (ii) the Parent is the corporation surviving such merger and (iii)
immediately after giving effect to such merger, no Default shall have occurred
and be continuing, (b) Subsidiaries of the Parent may merge with one another, or
with and into the Parent, where the Parent is the corporation surviving such
merger, (c) Borrowers which are Domestic Subsidiaries and Guarantors may
transfer assets among themselves, and (d) the foregoing limitation on the sale,
lease or other transfer of assets and on the discontinuation or elimination of a
business line or segment shall not apply to loans or advances permitted by
Section 5.06 or prohibit, during any Fiscal Quarter, a transfer of assets or the
discontinuance or elimination of a business line or segment (in a single
transaction or in a series of related transactions) unless the aggregate assets
to be so transferred or utilized in a business line or segment to be so
discontinued, when combined with all other assets transferred, and all other
assets utilized in all other business lines or segments discontinued, during
such Fiscal Quarter and the immediately preceding 3 Fiscal Quarters contributed
more than 20% of Consolidated Operating Profits during the 4 consecutive Fiscal
Quarters immediately preceding such Fiscal Quarter.
SECTION 5.12. Use of Proceeds. No portion of the proceeds of the
Loans will be used by the Parent or any Subsidiary (i) directly or indirectly,
for the purpose, whether immediate, incidental or ultimate, of purchasing or
carrying any Margin Stock, or (ii) for any purpose in violation of any
applicable law or regulation.
SECTION 5.13. Compliance with Laws; Payment of Taxes. (a) The Parent
will, and will cause each of its Subsidiaries and each member of the Controlled
Group to, comply with applicable laws (including but not limited to ERISA),
regulations and similar requirements of governmental authorities (including but
not limited to PBGC), except where the necessity of such compliance is being
contested in good faith through appropriate proceedings diligently pursued. The
Parent will, and will cause each of its Subsidiaries to, pay promptly when due
all taxes, assessments, governmental charges, claims for labor, supplies, rent
and other obligations which, if unpaid, might become a lien against the property
of the Parent or any Subsidiary, except liabilities being contested in good
faith by appropriate proceedings diligently pursued and against which, if
requested by the Agent, the Parent shall have set up reserves in accordance with
GAAP.
(b) The Parent shall not permit the aggregate complete or partial
withdrawal liability under Title IV of ERISA with respect to Multiemployer Plans
incurred by the Parent and members of the Controlled Group to exceed $10,000,000
at any time. For purposes of this Section 5.13(b), the amount of withdrawal
liability of the Parent and members of the Controlled Group at any date shall be
the aggregate present value of the amount claimed to have been incurred less any
portion thereof which the Parent and members of the Controlled Group have paid
or as to which the Parent reasonably believes, after appropriate consideration
of possible
43
adjustments arising under Sections 4219 and 4221 of ERISA, it and members of the
Controlled Group will have no liability.
SECTION 5.14. Insurance. The Parent will maintain, and will cause
each of its Subsidiaries to maintain (either in the name of the Parent or in
such Subsidiary's own name), with financially sound and reputable insurance
companies, insurance on all its Property in at least such amounts and against at
least such risks as are usually insured against in the same general area by
companies of established repute engaged in the same or similar business.
SECTION 5.15. Change in Fiscal Year. The Parent will not change its
Fiscal Year without the consent of the Required Banks.
SECTION 5.16. Maintenance of Property. The Parent shall, and shall
cause each Subsidiary to, maintain all of its material properties and assets in
good condition, repair and working order, ordinary wear and tear excepted.
SECTION 5.17. Environmental Notices. The Parent shall furnish to the
Banks and the Agent prompt written notice of all material Environmental
Liabilities, Environmental Notices and Environmental Judgments and Orders and
pending, threatened or anticipated Environmental Proceedings relating to the
Parent, any of its Subsidiaries or the Properties.
SECTION 5.18. Environmental Matters. The Parent and its Subsidiaries
will not, and will not permit any Third Party to, use, produce, manufacture,
process, treat, recycle, generate, store, dispose of, manage at, or otherwise
handle or ship or transport to or from the Properties any Hazardous Materials
except for Hazardous Materials used, produced, manufactured, processed, treated,
recycled, generated, stored, disposed, managed or otherwise handled, to the best
knowledge of the Parent, in compliance with all applicable Environmental
Requirements, except where the failure to comply could not reasonably be
expected to have or cause a Material Adverse Effect.
SECTION 5.19. Environmental Release. The Parent agrees that upon the
occurrence of an Environmental Release at or on any of the Properties it will
act immediately to investigate the extent of, and to take appropriate remedial
action with respect to, such Environmental Release, whether or not ordered or
otherwise directed to do so by any Environmental Authority.
SECTION 5.20. Transactions with Affiliates. Neither the Parent nor
any of its Subsidiaries shall enter into, or be a party to, any material
transaction with any Affiliate of the Parent or such Subsidiary (which Affiliate
is not a Borrower or a Guarantor), except as permitted by law and in the
ordinary course of business and pursuant to reasonable terms no less favorable
to the Parent or such Subsidiary than would be obtained in a comparable arm's
length transaction with a Person which is not an Affiliate.
SECTION 5.21. Limitation on Subsidiary Debt. The Parent shall not
permit the
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outstanding principal amount of Debt of its Subsidiaries (other than (i) Debt
owed to any Borrower or Guarantor and (ii) Debt owed under this Agreement or any
Loan Document) at any time to exceed, in the aggregate, an amount equal to or
greater than 10% of Consolidated Total Assets.
SECTION 5.22. Material Subsidiaries. (a) The Parent shall cause any
Person which becomes a Domestic Material Subsidiary on or after the Closing Date
to become a party to, and agree to be bound by the terms of, the Guaranty and
the Indemnity, Subrogation and Contribution Agreement pursuant to an instrument
in form and substance satisfactory to the Agent executed and delivered to the
Agent within 20 Domestic Business Days after the day on which such Person
becomes a Domestic Material Subsidiary. The Parent shall also cause the items
specified in Sections 3.01(e) and (h) to be delivered to the Agent concurrently
with the instrument referred to above, modified appropriately to refer to such
instrument and such Domestic Material Subsidiary.
(b) Once any Subsidiary becomes a Domestic Material Subsidiary and
therefore becomes a party to the Guaranty and the Indemnity, Subrogation and
Contribution Agreement in accordance with Section 5.22(a), such Subsidiary
thereafter shall remain a party to the Guaranty and the Indemnity, Subrogation
and Contribution Agreement without regard to the amount of its Total Assets on
any day or Operating Profits for any period.
SECTION 5.23. Y2K Plan. The Parent will exercise its best efforts to
meet the milestones contained in the Y2K Plan and be Year 2000 Ready on or about
June 30, 1999 (but in any event before August 31, 1999).
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) any Borrower shall fail to pay when due any principal of any
Loan or shall fail to pay any interest on any Loan within 5 Domestic Business
Days after such interest shall become due, or shall fail to pay any fee or other
amount payable hereunder within 5 Domestic Business Days after such fee or other
amount becomes due; or
(b) the Parent shall fail to observe or perform any covenant
contained in Section 5.01(e), 5.02(ii), 5.03, 5.04, 5.08, 5.09, 5.10 or 5.11; or
(c) any Borrower shall fail to observe or perform any covenant or
agreement contained or incorporated by reference in this Agreement (other than
those covered by clause (a) or (b) above) or any other Loan Document for thirty
days after the earlier of (i) the first day on which the Parent has knowledge of
such failure or (ii) written notice thereof has been given to the
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Parent by the Agent at the request of any Bank; or
(d) any representation, warranty, certification or statement made or
deemed made by the Parent in Article IV of this Agreement or in any certificate,
financial statement or other document delivered pursuant to this Agreement shall
prove to have been incorrect or misleading in any material respect when made (or
deemed made); or
(e) the Parent or any Subsidiary shall fail to make any payment in
respect of Debt outstanding in an aggregate principal amount in excess of
$10,000,000 (other than the Notes) when due or within any applicable grace
period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt outstanding of the Parent or any Subsidiary
in an aggregate principal amount in excess of $10,000,000 or the mandatory
prepayment or purchase of such Debt by the Parent (or its designee) or such
Subsidiary (or its designee) prior to the scheduled maturity thereof, or enables
(or, with the giving of notice or lapse of time or both, would enable) the
holders of such Debt or any Person acting on such holders' behalf to accelerate
the maturity thereof or require the mandatory prepayment or purchase thereof
prior to the scheduled maturity thereof, without regard to whether such holders
or other Person shall have exercised or waived their right to do so; or
(g) the Parent or any Subsidiary shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally, or shall admit in writing its
inability, to pay its debts as they become due, or shall take any corporate
action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Parent or any Subsidiary seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Parent or any Subsidiary under the federal
bankruptcy laws as now or hereafter in effect; or
(i) the Parent or any member of the Controlled Group shall fail to
pay when due any material amount which it shall have become liable to pay to the
PBGC or to a Plan under Title IV of ERISA; or notice of intent to terminate a
Plan or Plans shall be filed under Title IV of ERISA by the Parent, any member
of the Controlled Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title IV of ERISA
46
to terminate or to cause a trustee to be appointed to administer any such Plan
or Plans or a proceeding shall be instituted by a fiduciary of any such Plan or
Plans to enforce Section 515 or 4219(c)(5) of ERISA and such proceeding shall
not have been dismissed within 30 days thereafter; 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
(j) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $10,000,000 shall be rendered against the Parent
or any Subsidiary and the Parent or such Subsidiary shall not discharge the same
in accordance with its terms or procure a stay of execution thereof within 30
days from the date of entry thereof, and within such period of 30 days, or such
longer period during which execution of such judgment shall have been stayed,
appeal therefrom and cause the execution thereof to be stayed during such
appeal; or
(k) a federal tax lien shall be filed against the Parent or any
Subsidiary under Section 6323 of the Code or a lien of the PBGC shall be filed
against the Parent or any Subsidiary under Section 4068 of ERISA and in either
case such lien shall remain undischarged for a period of 25 days after the date
of filing; or
(l) (i) any Person or two or more Persons acting in concert shall
have acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
30% or more of the outstanding shares of the voting stock of the Parent; or (ii)
as of any date a majority of the Board of Directors of the Parent consists of
individuals who were not either (A) directors of the Parent as of the
corresponding date of the previous year, (B) selected or nominated to become
directors by the Board of Directors of the Parent of which a majority consisted
of individuals described in clause (A), or (C) selected or nominated to become
directors by the Board of Directors of the Parent of which a majority consisted
of individuals described in clause (A) and individuals described in clause (B);
or
(m) if any provision of the Guaranty shall for any reason cease to
be valid and binding on any Guarantor, or any Guarantor (or any Person acting on
behalf of any Guarantor) shall deny or disaffirm its obligations under the
Guaranty;
then, and in every such event, the Agent shall (i) if requested by the Required
Banks, by notice to the Parent terminate the Commitments and they shall
thereupon terminate, and (ii) if requested by the Required Banks, by notice to
the Parent declare the Notes (together with accrued interest thereon) and all
other amounts payable hereunder and under the other Loan Documents to be, and
the Notes (together with all accrued interest thereon) and all other amounts
payable hereunder and under the other Loan Documents shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers; provided that if
any Event of Default specified in clause (g) or (h) above occurs with respect to
any Borrower, without any notice to any Borrower or any other act by the Agent
or the Banks, the Commitments shall thereupon automatically terminate and the
47
Notes (together with accrued interest thereon) and all other amounts payable
hereunder and under the other Loan Documents shall automatically become
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers. Notwithstanding
the foregoing, the Agent shall have available to it all other remedies at law or
equity, and shall exercise any one or all of them at the request of the Required
Banks.
SECTION 6.02. Notice of Default. The Agent shall give notice to the
Parent of any Default under Section 6.01(c) promptly upon being requested to do
so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities. Each Bank hereby
irrevocably appoints and authorizes the Agent to act as its agent hereunder and
under the other Loan Documents with such powers as are specifically delegated to
the Agent by the terms hereof and thereof, together with such other powers as
are reasonably incidental thereto. The Agent: (a) shall have no duties or
responsibilities except as expressly set forth in this Agreement and the other
Loan Documents, and shall not by reason of this Agreement or any other Loan
Document be a trustee for any Bank; (b) shall not be responsible to the Banks
for any recitals, statements, representations or warranties contained in this
Agreement or any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any Bank under, this Agreement or
any other Loan Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any
failure by any Borrower or Guarantor to perform any of its obligations hereunder
or thereunder; (c) shall not be required to initiate or conduct any litigation
or collection proceedings hereunder or under any other Loan Document except to
the extent requested by the Required Banks, and then only on terms and
conditions satisfactory to the Agent, and (d) shall not be responsible for any
action taken or omitted to be taken by it hereunder or under any other Loan
Document or any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct. The Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it with reasonable care. The
provisions of this Article VII are solely for the benefit of the Agent and the
Banks, and no Borrower or Guarantor shall have any rights as a third party
beneficiary of any of the provisions hereof. In performing its functions and
duties under this Agreement and under the other Loan Documents, the Agent shall
act solely as agent of the Banks and does not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for any Borrower or Guarantor. The duties of the Agent shall be ministerial and
administrative in nature, and the Agent shall not have by reason of this
Agreement or any other Loan Document a fiduciary relationship in respect of any
Bank.
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SECTION 7.02. Reliance by Agent. The Agent shall be entitled to rely
upon any certification, notice or other communication (including any thereof by
telephone, telefax, telegram or cable) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper Person or Persons,
and upon advice and statements of legal counsel, independent accountants or
other experts selected by the Agent. As to any matters not expressly provided
for by this Agreement or any other Loan Document, the Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and
thereunder in accordance with instructions signed by the Required Banks, and
such instructions of the Required Banks in any action taken or failure to act
pursuant thereto shall be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default (other than the
non-payment of principal of or interest on the Loans or non-payment of the
facility fee) unless the Agent has received notice from a Bank or a Borrower
specifying such Default or Event of Default and stating that such notice is a
"Notice of Default". In the event that the Agent receives such a notice of the
occurrence of a Default or an Event of Default, the Agent shall give prompt
notice thereof to the Banks. The Agent shall give each Bank prompt notice of
each non-payment of principal of or interest on the Loans or of the facility
fee, whether or not it has received any notice of the occurrence of such
non-payment. The Agent shall (subject to Section 9.05) take such action with
respect to such Default or Event of Default as shall be directed by the Required
Banks, provided that, unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Banks.
SECTION 7.04. Rights of Agent and its Affiliates as a Bank. With
respect to any Loan made by Wachovia or an Affiliate of Wachovia, such Affiliate
and Wachovia in their capacity as a Bank hereunder shall have the same rights
and powers hereunder as any other Bank and may exercise the same as though it
were not an Affiliate of Wachovia (or in Wachovia's case, acting as the Agent),
and the term "Bank" or "Banks" shall, unless the context otherwise indicates,
include such Affiliate of Wachovia or Wachovia in its individual capacity. Such
Affiliate and Wachovia may (without having to account therefor to any Bank)
accept deposits from, lend money to and generally engage in any kind of banking,
trust or other business with any Borrower or Guarantor (and any Affiliate of any
Borrower or Guarantor) as if they were not an Affiliate of the Agent or the
Agent, respectively; and such Affiliate and Wachovia may accept fees and other
consideration from any Borrower or Guarantor (in addition to any agency fees and
arrangement fees heretofore agreed to between the Parent and Wachovia) for
services in connection with this Agreement or any other Loan Document or
otherwise without having to account for the same to the Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to
indemnify the Agent, to the extent the Agent shall not have been reimbursed by a
Borrower or Guarantor, ratably in accordance with its Commitment, for any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including, without limitation, counsel fees and
disbursements) or disbursements of any kind and nature whatsoever which may
49
be imposed on, incurred by or asserted against the Agent in any way relating to
or arising out of this Agreement or any other Loan Document or any other
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (excluding, unless an Event of Default has
occurred and is continuing, the normal administrative costs and expenses
incident to the performance of its agency duties hereunder) or the enforcement
of any of the terms hereof or thereof or any such other documents; provided,
however, that no Bank shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the Agent. If any
indemnity furnished to the Agent for any purpose shall, in the opinion of the
Agent, be insufficient or become impaired, the Agent may call for additional
indemnity and cease, or not commence, to do the acts indemnified against until
such additional indemnity is furnished.
SECTION 7.06. CONSEQUENTIAL DAMAGES. THE AGENT SHALL NOT BE
RESPONSIBLE OR LIABLE TO ANY BANK, ANY BORROWER, ANY GUARANTOR OR ANY OTHER
PERSON OR ENTITY FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY
BE ALLEGED AS A RESULT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 7.07. Payee of Note Treated as Owner The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until a written notice of the assignment or transfer thereof shall have been
filed with the Agent and the provisions of Section 9.07(c) have been satisfied.
Any requests, authority or consent of any Person who at the time of making such
request or giving such authority or consent is the holder of any Note shall be
conclusive and binding on any subsequent holder, transferee or assignee of that
Note or of any Note or Notes issued in exchange therefor or replacement thereof.
SECTION 7.08. Non-Reliance on Agent and Other Banks. Each Bank
agrees that it has, independently and without reliance on the Agent or any other
Bank, and based on such documents and information as it has deemed appropriate,
made its own credit analysis of the Borrowers and the Guarantors and decision to
enter into this Agreement and that it will, independently and without reliance
upon the Agent or any other Bank, and based on such documents and information as
it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or any of the
other Loan Documents. The Agent shall not be required to keep itself (or any
Bank) informed as to the performance or observance by the Borrowers of this
Agreement or any of the other Loan Documents or any other document referred to
or provided for herein or therein or to inspect the properties or books of the
Borrowers or any other Person. Except for notices, reports and other documents
and information expressly required to be furnished to the Banks by the Agent
hereunder or under the other Loan Documents, the Agent shall not have any duty
or responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of the Borrowers or any
other Person (or any of their Affiliates) which may come into the possession of
the Agent.
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SECTION 7.09. Failure to Act. Except for action expressly required
of the Agent hereunder or under the other Loan Documents, the Agent shall in all
cases be fully justified in failing or refusing to act hereunder and thereunder
unless it shall receive further assurances to its satisfaction by the Banks of
their indemnification obligations under Section 7.05 against any and all
liability and expense which may be incurred by the Agent by reason of taking,
continuing to take, or failing to take any such action.
SECTION 7.10. Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below, the Agent may
resign at any time by giving notice thereof to the Banks and the Parent and the
Agent may be removed at any time with or without cause by the Required Banks.
Upon any such resignation or removal, the Required Banks shall have the right to
appoint a successor Agent. If no successor Agent shall have been so appointed by
the Required Banks and shall have accepted such appointment within 30 days after
the retiring Agent's notice of resignation or the Required Banks' removal of the
retiring Agent, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent. Any successor Agent shall be a bank which has a combined
capital and surplus of at least $500,000,000. 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 or removal hereunder as Agent, the provisions of this Article VII
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 the Agent hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars or the relevant
Foreign Currency (in the applicable amounts) are not being offered in the
relevant market for such Interest Period, or
(b) the Required Banks advise the Agent that the London Interbank
Offered Rate or IBOR, as the case may be, as reasonably determined by the Agent,
will not adequately and fairly reflect the cost to such Banks of funding the
relevant type of Fixed Rate Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Parent and the Banks,
whereupon until the Agent notifies the Parent that the circumstances giving rise
to such suspension no longer exist, the obligations of the Banks to make the
type of Fixed Rate Loans specified in such notice shall be suspended. Unless the
relevant Borrower notifies the Agent at least 2 Domestic Business
51
Days before the date of any Borrowing of such type of Fixed Rate Loans for which
a Notice of Borrowing has previously been given that it elects not to borrow on
such date, such Borrowing shall instead be made as a Base Rate Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the adoption of
any applicable law, rule or regulation, or any change in any existing or future
law, rule or regulation, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof (any such authority, bank or
agency being referred to as an "Authority" and any such event being referred to
as a "Change of Law"), or compliance by any Bank (or its Lending Office) with
any request or directive (whether or not having the force of law) of any
Authority shall make it unlawful or impossible for any Bank (or its Lending
Office) to make, maintain or fund its Euro-Dollar Loans or Syndicated Foreign
Currency Loans and such Bank shall so notify the Agent, the Agent shall
forthwith give notice thereof to the other Banks and the Parent, whereupon until
such Bank notifies the Parent and the Agent that the circumstances giving rise
to such suspension no longer exist, the obligation of such Bank to make
Euro-Dollar Loans or Syndicated Foreign Currency Loans, as the case may be,
shall be suspended. Before giving any notice to the Agent pursuant to this
Section, such Bank shall designate a different Lending Office if such
designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank
shall determine that it may not lawfully continue to maintain and fund any of
its outstanding Euro-Dollar Loans or Syndicated Foreign Currency Loans, as the
case may be, to maturity and shall so specify in such notice, the relevant
Borrower shall immediately prepay in full the then outstanding principal amount
of each Euro-Dollar Loan or Syndicated Foreign Currency Loan, as the case may
be, of such Bank, together with accrued interest thereon and any amount due such
Bank pursuant to Section 8.05(a). Concurrently with prepaying each such
Euro-Dollar Loan or Syndicated Foreign Currency Loan, as the case may be, the
relevant Borrower shall borrow a Base Rate Loan in an equal principal amount
from such Bank (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans or Syndicated Foreign
Currency Loans, as the case may be, of the other Banks), and such Bank shall
make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after the
date hereof, a Change of Law or compliance by any Bank (or its Lending Office)
with any request or directive (whether or not having the force of law) of any
Authority:
(i) shall subject any Bank (or its Lending Office) to any tax,
duty or other charge with respect to its Fixed Rate Loans, its Notes
or its obligation to make Fixed Rate Loans, or shall change the
basis of taxation of payments to any Bank (or its Lending Office) of
the principal of or interest on its Fixed Rate Loans or any other
amounts due under this Agreement in respect of its Fixed Rate Loans
or its obligation to make Fixed Rate Loans (except for changes in
the rate of tax on the overall net income of such Bank or its
Lending Office imposed by the jurisdiction in which such Bank's
principal executive office or Lending Office is located); or
52
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without
limitation, any such requirement imposed by the Board of Governors
of the Federal Reserve System, but excluding (A) with respect to any
Syndicated Foreign Currency Loan any such requirement included in an
applicable Adjusted IBOR Rate and (B) with respect to any
Euro-Dollar Loan any such requirement included in an applicable
Euro-Dollar Reserve Percentage) against assets of, deposits with or
for the account of, or credit extended by, any Bank (or its Lending
Office); or
(iii) shall impose on any Bank (or its Lending Office) or on
the London or other relevant interbank market any other condition
affecting its Fixed Rate Loans, its Notes or its obligation to make
Fixed Rate Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Fixed Rate Loan, or to reduce
the amount of any sum received or receivable by such Bank (or its Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Agent), the Borrowers shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.
(b) If any Bank shall have determined that after the date hereof the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any existing or future law, rule or regulation, or any change
in the interpretation or administration thereof, or compliance by any Bank (or
its Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any Authority, has or would have the
effect of reducing the rate of return on such Bank's capital as a consequence of
its obligations hereunder to a level below that which such Bank could have
achieved but for such adoption, change or compliance (taking into consideration
such Bank's policies with respect to capital adequacy) by an amount deemed by
such Bank to be material, then from time to time, within 15 days after demand by
such Bank, the Borrowers shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such reduction.
(c) Each Bank will promptly notify the Parent and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. A certificate of any Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods.
(d) The provisions of this Section 8.03 shall be applicable with
respect to any Participant, Assignee or other Transferee, and any calculations
required by such provisions shall
53
be made based upon the circumstances of such Participant, Assignee or other
Transferee and shall constitute a continuing agreement and shall survive the
termination of this Agreement and the payment in full or cancellation of the
Notes.
SECTION 8.04. Base Rate Loans or Other Fixed Rate Loans Substituted
for Affected Fixed Rate Loans. If (i) the obligation of any Bank to make or
maintain Euro-Dollar Loans or Syndicated Foreign Currency Loans has been
suspended pursuant to Section 8.02 or (ii) any Bank has demanded compensation
under Section 8.03, and the Parent shall, by at least 5 Euro-Dollar Business
Days' prior notice to such Bank through the Agent, have elected that the
provisions of this Section shall apply to such Bank, then, unless and until such
Bank notifies the Parent that the circumstances giving rise to such suspension
or demand for compensation no longer apply:
(a) all Loans which would otherwise be made by such Bank as
Syndicated Foreign Currency Loans or Euro-Dollar Loans, as the case may be,
shall be made instead either (A) as Base Rate Loans, (B) if such suspension or
demand for compensation relates to Euro-Dollar Loans, but not Syndicated Foreign
Currency Loans, as Syndicated Foreign Currency Loans, or (C) if such demand for
compensation relates to Syndicated Foreign Currency Loans, but not Euro-Dollar
Loans, as Euro-Dollar Loans, as the Parent may elect in the notice to such Bank
through the Agent referred to hereinabove (in all cases interest and principal
on such Loans shall be payable contemporaneously with the related Fixed Rate
Loans of the other Banks), and
(b) after each of its Syndicated Foreign Currency Loans or
Euro-Dollar Loans, as the case may be, has been repaid, all payments of
principal which would otherwise be applied to repay such Fixed Rate Loans shall
be applied to repay its Base Rate Loans instead.
In the event that the Parent shall elect that the provisions of this Section
shall apply to any Bank, the Borrowers shall remain liable for, and shall pay to
such Bank as provided herein, all amounts due such Bank under Section 8.03 in
respect of the period preceding the date of conversion of such Bank's Loans
resulting from the Parent's election.
SECTION 8.05. Compensation. Upon the request of any Bank, delivered
to the Parent and the Agent, the Borrowers shall pay to such Bank such amount or
amounts as shall compensate such Bank for any loss, cost or expense incurred by
such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.10, Section
2.11, Section 6.01, Section 8.02 or otherwise) of a Fixed Rate Loan or a Money
Market Loan on a date other than the last day of an Interest Period for such
Fixed Rate Loan or Money Market Loan, as the case may be;
(b) any failure by a Borrower to prepay a Fixed Rate Loan or a Money
Market Loan on the date for such prepayment specified in the relevant notice of
prepayment hereunder;
54
(c) any failure by a Borrower to borrow a Fixed Rate Loan on the
date for the Fixed Rate Borrowing of which such Fixed Rate Loan is a part
specified in the applicable Notice of Borrowing delivered pursuant to Section
2.02;
(d) any failure by a Borrower to borrow a Money Market Loan (with
respect to which such Borrower has accepted a Money Market Quote) on the date
for the Money Market Borrowing of which such Money Market Loan is a part
specified in the applicable Money Market Quote Request delivered pursuant to
Section 2.03; or
(e) any failure by a Borrower to pay a Syndicated Foreign Currency
Loan in the applicable Foreign Currency;
such compensation to include, without limitation, as applicable: (A) an amount
equal to the excess, if any, of (x) the amount of interest which would have
accrued on the amount so paid or prepaid or not prepaid or borrowed for the
period from the date of such payment, prepayment or failure to prepay or borrow
to the last day of the then current Interest Period for such Fixed Rate Loan
(or, in the case of a failure to prepay or borrow, the Interest Period for such
Fixed Rate Loan which would have commenced on the date of such failure to prepay
or borrow) at the applicable rate of interest for such Fixed Rate Loan provided
for herein over (y) the amount of interest (as reasonably determined by such
Bank) such Bank would have paid on (i) deposits in Dollars of comparable amounts
having terms comparable to such period placed with it by leading banks in the
London interbank market (if such Fixed Rate Loan is a Euro-Dollar Loan), or (ii)
any deposit in a Foreign Currency of comparable amounts having terms comparable
to such period placed with it by lending banks in the applicable interbank
market for such Foreign Currency (if such Fixed Rate Loan is a Syndicated
Foreign Currency Loan) or (B) any such loss, cost or expense incurred by such
Bank in liquidating or closing out any foreign currency contract undertaken by
such Bank in funding or maintaining such Fixed Rate Loan (if such Fixed Rate
Loan is a Syndicated Foreign Currency Loan).
SECTION 8.06. Failure to Pay in Foreign Currency. If any Borrower is
unable for any reason to effect payment in a Foreign Currency as required by
this Agreement or if any Borrower shall default in a Foreign Currency, each Bank
may, through the Agent, require such payment to be made in Dollars in the Dollar
Equivalent amount of such payment. In any case in which any Borrower shall make
such payment in Dollars, such Borrower agrees to hold the Banks harmless from
any loss incurred by the Banks arising from any change in the value of Dollars
in relation to such Foreign Currency between the date such payment became due
and the date of payment thereof.
SECTION 8.07. Judgment Currency. If for the purpose of obtaining
judgment in any court or enforcing any such judgment it is necessary to convert
any amount due in any Foreign Currency into any other currency, the rate of
exchange used shall be the Agent's spot rate of exchange for the purchase of the
Foreign Currency with such other currency at the close of business on the
Foreign Currency Business Day preceding the date on which judgment is given or
any order for payment is made. The obligation of the relevant Borrower in
respect of
55
any amount due from it hereunder shall, notwithstanding any judgment or order
for a liquidated sum or sums in respect of amounts due hereunder or under any
judgment or order in any other currency or otherwise be discharged only to the
extent that on the Foreign Currency Business Day following receipt by the Agent
of any payment in a currency other than the relevant Foreign Currency the Agent
is able (in accordance with normal banking procedures) to purchase the relevant
Foreign Currency with such other currency. If the amount of the relevant Foreign
Currency that the Agent is able to purchase with such other currency is less
than the amount due in the relevant Foreign Currency, notwithstanding any
judgment or order, such Borrower shall indemnify the Banks for the shortfall.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given to such party at its address
or telecopy number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for the purpose by notice
to each other party. Each such notice, request or other communication shall be
effective (i) if given by telecopier, when such telecopy is transmitted to the
telecopy number specified in this Section and the telecopy machine used by the
sender provides a written confirmation that such telecopy has been so
transmitted or receipt of such telecopy transmission is otherwise confirmed,
(ii) if given by mail, 72 hours after such communication is deposited in the
mails with first class postage prepaid, addressed as aforesaid, and (iii) if
given by any other means, when delivered at the address specified in this
Section; provided that notices to the Agent under Article II or Article VIII
shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or any
Bank in exercising any right, power or privilege hereunder or under any Note or
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. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 9.03. Expenses; Documentary Taxes; Indemnification. (a) The
Borrowers shall pay (i) all out-of-pocket expenses of the Agent, including fees
and disbursements of special counsel for the Agent (subject to the limitation
specified in the Agent's Letter Agreement), in connection with the preparation
of this Agreement and the other Loan Documents, any waiver or consent hereunder
or thereunder or any amendment hereof or thereof or any Default or alleged
Default hereunder or thereunder and (ii) if a Default occurs, all out-of-pocket
expenses incurred by the Agent or any Bank, including fees and disbursements of
counsel, in connection with such Default and collection and other enforcement
proceedings resulting therefrom, including out-of-pocket expenses incurred in
enforcing this Agreement and the other Loan Documents.
56
(b) The Borrowers shall indemnify the Agent and each Bank against
any transfer taxes, documentary taxes, assessments or charges made by any
Authority by reason of the execution and delivery of this Agreement or the other
Loan Documents.
(c) The Borrowers shall indemnify the Agent, the Banks and each
Affiliate thereof and their respective directors, officers, employees and agents
from, and hold each of them harmless against, any and all losses, liabilities,
claims or damages to which any of them may become subject, insofar as such
losses, liabilities, claims or damages arise out of or result from any actual or
proposed use by any Borrower of the proceeds of any extension of credit by any
Bank hereunder or breach by any Borrower of this Agreement or any other Loan
Document or from investigation, litigation (including, without limitation, any
actions taken by the Agent or any of the Banks to enforce this Agreement or any
of the other Loan Documents) or other proceeding (including, without limitation,
any threatened investigation or proceeding) relating to the foregoing, and the
Borrowers shall reimburse the Agent and each Bank, and each Affiliate thereof
and their respective directors, officers, employees and agents, upon demand for
any expenses (including, without limitation, legal fees) incurred in connection
with any such investigation or proceeding; but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified.
SECTION 9.04. Setoffs; Sharing of Set-Off. (a) Each Borrower hereby
grants to each Bank, as security for the full and punctual payment and
performance of the obligations of such Borrower under this Agreement, a
continuing lien on and security interest in all deposits and other sums credited
by or due from such Bank to such Borrower or subject to withdrawal by such
Borrower; and regardless of the adequacy of any collateral or other means of
obtaining repayment of such obligations, each Bank may at any time upon or after
the occurrence of any Event of Default, and without notice to any Borrower, set
off the whole or any portion or portions of any or all such deposits and other
sums against such obligations, whether or not any other Person or Persons could
also withdraw money therefrom.
(b) Each Bank agrees that if it shall, by exercising any right of
set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest owing with respect to the Syndicated
Notes held by it which is greater than the proportion received by any other Bank
in respect of the aggregate amount of all principal and interest owing with
respect to the Syndicated Notes held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the
Syndicated Notes held by the other Banks owing to such other Banks, and/or such
other adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Syndicated Notes held by the Banks
owing to such other Banks shall be shared by the Banks pro rata; provided that
(i) nothing in this Section shall impair the right of any Bank to exercise any
right of set-off or counterclaim it may have and to apply the amount subject to
such exercise to the payment of indebtedness (including, without limitation,
Money Market Loans) of any Borrower other than its indebtedness under the
Syndicated Notes, and (ii) if all or any portion of such payment received by the
purchasing Bank is thereafter recovered from such purchasing
57
Bank, such purchase from each other Bank shall be rescinded and such other Bank
shall repay to the purchasing Bank the purchase price of such participation to
the extent of such recovery together with an amount equal to such other Bank's
ratable share (according to the proportion of (x) the amount of such other
Bank's required repayment to (y) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. Each Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that any holder of a participation in a Syndicated Note, whether or not acquired
pursuant to the foregoing arrangements, may exercise rights of set-off or
counterclaim and other rights with respect to such participation as fully as if
such holder of a participation were a direct creditor of such Borrower in the
amount of such participation.
SECTION 9.05. Amendments and Waivers. (a) Any provision of this
Agreement, the Notes or any other Loan Documents may be amended or waived if,
but only if, such amendment or waiver is in writing and is signed by the
Borrowers and the Required Banks (and, if the rights or duties of the Agent are
affected thereby, by the Agent); provided that no such amendment or waiver
shall, unless signed by all the Banks, (i) change the Commitment of any Bank or
subject any Bank to any additional obligation, (ii) change the principal of or
reduce the rate of interest on any Loan or reduce any fees hereunder, (iii)
change the date fixed for any payment of principal of or interest on any Loan or
any fees hereunder, (iv) change the amount of principal or reduce the rate or
amount of interest or fees due on any date fixed for the payment thereof, (v)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of the Notes, or the percentage of Banks, which shall be required for the
Banks or any of them to take any action under this Section or any other
provision of this Agreement, (vi) change the manner of application of any
payments made under this Agreement or the Notes, or (vii) release any guaranty
given to support payment of the Loans.
(b) The Borrowers will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment of any of the provisions of this
Agreement unless each Bank shall be informed thereof by the Borrowers and shall
be afforded an opportunity of considering the same and shall be supplied by the
Borrowers with sufficient information to enable it to make an informed decision
with respect thereto. Executed or true and correct copies of any waiver or
consent effected pursuant to the provisions of this Agreement shall be delivered
by the Borrowers to each Bank forthwith following the date on which the same
shall have been executed and delivered by the requisite percentage of Banks. The
Borrowers will not, directly or indirectly, pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest, fee or
otherwise, to any Bank (in its capacity as such) as consideration for or as an
inducement to the entering into by such Bank of any waiver or amendment of any
of the terms and provisions of this Agreement unless such remuneration is
concurrently paid, on the same terms, ratably to all such Banks.
SECTION 9.06. Margin Stock Collateral. Each of the Banks represents
to the Agent and each of the other Banks that it in good faith is not, directly
or indirectly (by negative pledge or otherwise), relying upon any Margin Stock
as collateral in the extension or maintenance of the credit provided for in this
Agreement.
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SECTION 9.07. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided that the Borrowers may not
assign or otherwise transfer any of their respective rights under this
Agreement.
(b) Any Bank may at any time sell to one or more Persons (each a
"Participant") participating interests in any Loan owing to such Bank, any Note
held by such Bank, any Commitment hereunder or any other interest of such Bank
hereunder. In the event of any such sale by a Bank of a participating interest
to a Participant, such Bank's obligations under this Agreement shall remain
unchanged, such Bank shall remain solely responsible for the performance
thereof, such Bank shall remain the holder of any such Note for all purposes
under this Agreement, and the Borrowers and the Agent shall continue to deal
solely and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement. In no event shall a Bank that sells a
participation be obligated to the Participant to take or refrain from taking any
action hereunder except that such Bank may agree that it will not (except as
provided below), without the consent of the Participant, agree to (i) the change
of any date fixed for the payment of principal of or interest on the related
Loan or Loans, (ii) the change of the amount of any principal or reduction of
the rate or amount of any interest or fees due on any date fixed for the payment
thereof with respect to the related Loan or Loans, (iii) the change of the
principal of the related Loan or Loans, (iv) any reduction of the rate at which
either interest is payable thereon or (if the Participant is entitled to any
part thereof) facility fee is payable hereunder from the rate at which the
Participant is entitled to receive interest or facility fee (as the case may be)
in respect of such participation, or (v) the release of any guaranty given to
support payment of the Loans. Each Bank selling a participating interest in any
Loan having a term in excess of 1 year, Note, Commitment or other interest under
this Agreement shall, within 10 Domestic Business Days of such sale, provide the
Parent and the Agent with written notification stating that such sale has
occurred and identifying the Participant and the interest purchased by such
Participant. The Borrowers agree that each Participant shall be entitled to the
benefits of Article VIII with respect to its participation in Loans outstanding
from time to time.
(c) Any Bank may at any time assign to one or more banks or
financial institutions (each an "Assignee") all, or a proportionate part of all,
of its rights and obligations under this Agreement, the Notes and the other Loan
Documents, and such Assignee shall assume all such rights and obligations,
pursuant to an Assignment and Acceptance in the form attached hereto as Exhibit
K, executed by such Assignee, such transferor Bank and the Agent (and, in the
case of: (i) an Assignee that is not then a Bank or an Affiliate of a Bank; and
(ii) an assignment not made during the existence of a Default or an Event of
Default, by the Parent); provided that (i) no interest may be sold by a Bank
pursuant to this paragraph (c) unless the Assignee shall agree to assume ratably
equivalent portions of the transferor Bank's Commitment, (ii) the amount of the
Commitment of the assigning Bank being assigned pursuant to such assignment
(determined as of the effective date of the assignment) shall be equal to or
greater than $10,000,000, (iii) no interest may be sold by a Bank pursuant to
this paragraph (c) to any Assignee that is not then a Bank or an Affiliate of a
Bank without the consent of the Parent, which consent shall not be unreasonably
withheld, provided that the Parent's consent shall not be
59
necessary with respect to any assignment made during the existence of a Default
or an Event of Default; (iv) a Bank may not have more than 2 Assignees that are
not then Banks, and (v) no interest may be sold by a Bank pursuant to this
paragraph (c) to any Assignee that is not then a Bank or an Affiliate of a Bank,
without the consent of the Agent, which consent shall not be unreasonably
withheld, provided, that although the Agent's consent may not be necessary with
respect to an Assignee that is then a Bank or an Affiliate of a Bank, no such
assignment shall be effective until the conditions set forth in the following
sentence are satisfied. Upon (A) execution of the Assignment and Acceptance by
such transferor Bank, such Assignee, the Agent and (if applicable) the Parent,
(B) delivery of an executed copy of the Assignment and Acceptance to the Parent
and the Agent, (C) payment by such Assignee to such transferor Bank of an amount
equal to the purchase price agreed between such transferor Bank and such
Assignee, and (D) payment by the assigning Bank of a processing and recordation
fee of $3,500 to the Agent, such Assignee shall for all purposes be a Bank party
to this Agreement and shall have all the rights and obligations of a Bank under
this Agreement (including, without limitation, the rights of a Bank under
Section 2.03) to the same extent as if it were an original party hereto with a
Commitment as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding extent,
and no further consent or action by the Borrowers, the Banks or the Agent shall
be required. Upon the consummation of any transfer to an Assignee pursuant to
this paragraph (c), the transferor Bank, the Agent and the Borrowers shall make
appropriate arrangements so that, if required, new Notes are issued to each of
such Assignee and such transferor Bank.
(d) Subject to the provisions of Section 9.08, the Borrowers
authorize each Bank to disclose to any Participant, Assignee or other transferee
(each a "Transferee") and any prospective Transferee any and all financial and
other information in such Bank's possession concerning the Borrowers which has
been delivered to such Bank by the Borrowers pursuant to this Agreement or which
has been delivered to such Bank by the Borrowers in connection with such Bank's
credit evaluation prior to entering into this Agreement.
(e) No Transferee shall be entitled to receive any greater payment
under Section 8.03 than the transferor Bank would have been entitled to receive
with respect to the rights transferred, unless such transfer is made with the
Parent's prior written consent or by reason of the provisions of Section 8.02 or
8.03 requiring such Bank to designate a different Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
(f) Anything in this Section 9.07 to the contrary notwithstanding,
any Bank may assign and pledge all or any portion of the Loans and/or
obligations owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and Operating Circular issued by such
Federal Reserve Bank, provided that any payment in respect of such assigned
Loans and/or obligations made by the relevant Borrowers to the assigning and/or
pledging Bank in accordance with the terms of this Agreement shall satisfy such
Borrower's obligations hereunder in respect of such assigned Loans and/or
obligations to the extent of such payment. No such assignment
60
shall release the assigning and/or pledging Bank from its obligations hereunder.
SECTION 9.08. Confidentiality. Each Bank agrees to exercise
commercially reasonable efforts to keep any information delivered or made
available by the Parent to it which is clearly indicated to be confidential
information, confidential from anyone other than persons employed or retained by
such Bank or an Affiliate of such Bank who are or are expected to become engaged
in evaluating, approving, structuring or administering the Loans; provided,
however, that nothing herein shall prevent any Bank from disclosing such
information (i) to any other Bank, (ii) upon the order of any court or
administrative agency or pursuant to subpoena or other court process, (iii) upon
the request or demand of any regulatory agency or authority having jurisdiction
over such Bank, (iv) which has been publicly disclosed, (v) to the extent
reasonably required in connection with any litigation to which the Agent, any
Bank or their respective Affiliates may be a party, (vi) to the extent
reasonably required in connection with the exercise of any remedy hereunder,
(vii) to such Bank's legal counsel and independent auditors and (viii) to any
actual or proposed Participant, Assignee or other Transferee of all or part of
its rights hereunder which has agreed in writing to be bound by the provisions
of this Section 9.08.
SECTION 9.09. Representation by Banks. Each Bank hereby represents
that it is a commercial lender or financial institution which makes loans in the
ordinary course of its business and that it will make its Loans hereunder for
its own account in the ordinary course of such business; provided, however,
that, subject to Section 9.07, the disposition of the Note or Notes held by that
Bank shall at all times be within its exclusive control.
SECTION 9.10. Obligations Several. The obligations of each Bank
hereunder are several, and no Bank shall be responsible for the obligations or
commitment of any other Bank hereunder. Nothing contained in this Agreement and
no action taken by the Banks pursuant hereto shall be deemed to constitute the
Banks to be a partnership, an association, a joint venture or any other kind of
entity. The amounts payable at any time hereunder to each Bank shall be a
separate and independent debt, and each Bank shall be entitled to protect and
enforce its rights arising out of this Agreement or any other Loan Document and
it shall not be necessary for any other Bank to be joined as an additional party
in any proceeding for such purpose.
SECTION 9.11. Survival of Certain Obligations. Sections 8.03(a),
8.03(b), 8.05 and 9.03, and the obligations of the Borrowers thereunder, shall
survive, and shall continue to be enforceable notwithstanding, the termination
of this Agreement and the Commitments and the payment in full of the principal
of and interest on all Loans.
SECTION 9.12. Georgia Law. This Agreement and each Note shall be
construed in accordance with and governed by the law of the State of Georgia.
SECTION 9.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other Loan
Documents should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining
61
provisions contained herein and therein shall not in any way be affected or
impaired thereby and shall be enforced to the greatest extent permitted by law.
SECTION 9.14. Interest. In no event shall the amount of interest due
or payable hereunder or under the Notes exceed the maximum rate of interest
allowed by applicable law, and in the event any such payment is inadvertently
made to any Bank by any Borrower or inadvertently received by any Bank, then
such excess sum shall be credited as a payment of principal, unless such
Borrower shall notify such Bank in writing that it elects to have such excess
sum returned forthwith. It is the express intent hereof that no Borrower shall
pay nor any Bank receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by such Borrower under
applicable law.
SECTION 9.15. Interpretation. No provision of this Agreement or any
of the other Loan Documents shall be construed against or interpreted to the
disadvantage of any party hereto by any court or other governmental or judicial
authority by reason of such party having or being deemed to have structured or
dictated such provision.
SECTION 9.16. Consent to Jurisdiction. The Borrowers (a) submit to
personal jurisdiction in the State of Georgia, the courts thereof and the United
States District Courts sitting therein, for the enforcement of this Agreement,
the Notes and the other Loan Documents, (b) waive any and all personal rights
under the law of any jurisdiction to object on any basis (including, without
limitation, inconvenience of forum) to jurisdiction or venue within the State of
Georgia for the purpose of litigation to enforce this Agreement, the Notes or
the other Loan Documents, and (c) agree that service of process may be made upon
it in the manner prescribed in Section 9.01 for the giving of notice to the
Borrowers. Nothing herein contained, however, shall prevent the Agent from
bringing any action or exercising any rights against any security and against
any Borrower personally, and against any assets of any Borrower, within any
other state or jurisdiction.
SECTION 9.17. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
SECTION 9.18. European Economic and Monetary Union (a) In this
Section 9.18 and in each other provision of this Agreement to which reference is
made in this Section 9.18 expressly or impliedly, the following terms have the
meanings given to them in this Section 9.18.
"commencement of the third stage of EMU" means the date of
commencement of the third stage of EMU (January 1, 1999) or the date on which
circumstances arise which (in the opinion of the Agent) have substantially the
same effect and result in substantially the same consequences as commencement of
the third stage of EMU as contemplated by the Treaty on European Union.
62
"EMU" means economic and monetary union as contemplated in the
Treaty on European Union.
"EMU legislation" means legislative measures of the European Council
for the introduction of, changeover to or operation of a single or unified
European currency (whether known as the euro or otherwise), being in part the
implementation of the third stage of EMU.
"euro" means the single currency of participating member states of
the European Union.
"euro unit" means the currency unit of the euro.
"national currency unit" means the unit of currency (other than a
euro unit) of a participating member state.
"participating member state" means each state so described in any
EMU legislation.
"Treaty on European Union" means the Treaty of Rome of March 25,
1957, as amended by the Single European Act 1986 and the Maastricht Treaty
(which was signed at Maastricht on February 7, 1992, and came into force on
November 1, 1993), as amended from time to time.
(b) The provisions of paragraphs (c) to (i) below (inclusive) shall
be effective at and from the commencement of the third stage of EMU, provided,
that if and to the extent that any such provision relates to any state (or the
currency of such state) that is not a participating member state on the
commencement of the third stage of EMU, such provision shall become effective in
relation to such state (and the currency of such state) at and from the date on
which such state becomes a participating member state.
(c) Each obligation under this Agreement of a party to this
Agreement which has been denominated in the national currency unit of a
participating member state shall be redenominated into the euro unit in
accordance with EMU legislation, provided, that if and to the extent that any
EMU legislation provides that following the commencement of the third stage of
EMU an amount denominated either in the euro or in the national currency unit of
a participating member state and payable within that participating member state
by crediting an account of the creditor can be paid by the debtor either in the
euro unit or in the national currency unit, each party to this Agreement shall
be entitled to pay or repay any such amount either in the euro unit or in such
national currency unit.
(d) Any Syndicated Foreign Currency Loan in the currency of a
participating member state shall be made in the euro unit.
(e) Sections 2.02(c) and 2.12(a) shall be construed so that, in
relation to the
63
payment of any amount of euro units or national currency units, such amount
shall be made available to the Agent in immediately available, freely
transferable, cleared funds to such account with such bank in London, England
(or such other principal financial center in such participating member state as
the Agent may from time to time nominate for this purpose) as the Agent shall
from time to time nominate for this purpose.
(f) Any amount payable by the Agent to the Banks under this
Agreement in the currency of a participating member state shall be paid in the
euro unit.
(g) With respect to the payment of any amount denominated in the
euro or in a national currency unit, the Agent shall not be liable to the
Borrowers or any of the Banks in any way whatsoever for any delay, or the
consequences of any delay, in the crediting to any account of any amount
required by this Agreement to be paid by the Agent if the Agent shall have taken
all relevant steps to achieve, on the date required by this Agreement, the
payment of such amount in immediately available, freely transferable, cleared
funds (in the euro unit or, as the case may be, in a national currency unit) to
the account with the bank in the principal financial center in the participating
member state which the relevant Borrower or, as the case may be, any Bank shall
have specified for such purpose. In this paragraph (g), "all relevant steps"
means all such steps as may be prescribed from time to time by the regulations
or operating procedures of such clearing or settlement system as the Agent may
from time to time determine for the purpose of clearing or settling payments of
the euro.
(h) If the basis of accrual of interest or fees expressed in this
Agreement with respect to the currency of any state that becomes a participating
state shall be inconsistent with any convention or practice in the London
interbank market for the basis of accrual of interest or fees in respect of the
euro, such convention or practice shall replace such expressed basis effective
as of and from the date on which such state becomes a participating member
state; provided, that if any Syndicated Foreign Currency Loan in the currency of
such state is outstanding immediately prior to such date, such replacement shall
take effect, with respect to such Syndicated Foreign Currency Loan, at the end
of the then current Interest Period.
(i) Without prejudice and in addition to any method of conversion or
rounding prescribed by any EMU legislation and without prejudice to the
respective liabilities for indebtedness of the Borrowers to the Banks and the
Banks to the Borrowers under or pursuant to this Agreement:
(i) each reference in this Agreement to a minimum amount (or
an integral multiple thereof) in a national currency
unit to be paid to or by the Agent shall be replaced by
a reference to such reasonably comparable and convenient
amount (or an integral multiple thereof)in the euro unit
as the Agent may from time to time specify; and
(ii) except as expressly provided in this Section 9.18, each
provision of
64
this Agreement shall be subject to such reasonable
changes of construction as the Agent may from time to
time specify to be necessary or appropriate to reflect
the introduction of or changeover to the euro in
participating member states.
SECTION 9.19. Concerning Joint and Several Liability of the
Borrowers (a) Each of the Borrowers is accepting joint and several liability
hereunder in consideration of the financial accommodation to be provided by the
Banks under this Agreement, for the mutual benefit, directly and indirectly, of
each of the Borrowers and in consideration of the undertakings of each of the
Borrowers to accept joint and several liability for the obligations of each of
them.
(b) Each of the Borrowers jointly and severally hereby irrevocably
and unconditionally accepts, not merely as a surety but also as a co-debtor,
joint and several liability with the other Borrowers with respect to the payment
and performance of all of the obligations of all Borrowers under this Agreement
or any other Loan Document, it being the intention of the parties hereto that
all such obligations shall be the joint and several obligations of each of the
Borrowers without preferences or distinction between them.
(c) If and to the extent that any Borrower shall fail to make any
payment with respect to any of the obligations of any Borrower under this
Agreement or any other Loan Document as and when due or to perform any of such
obligations in accordance with the terms thereof, then in each such event, the
other Borrowers will make such payment with respect to, or perform, such
obligations.
(d) The obligations of each Borrower under the provisions of this
Section 9.19 constitute full recourse obligations of such Borrower, enforceable
against it to the full extent of its properties and assets, irrespective of the
validity, regularity or enforceability of this Agreement or any other Loan
Document or any other circumstances whatsoever.
(e) Except as otherwise expressly provided herein or required by
applicable law, each Borrower hereby waives notice of acceptance of its joint
and several liability, notice of any other Borrower's request for any Loan under
this Agreement, notice of any Loan made under this Agreement, notice of
occurrence of any Default or Event of Default, of any demand for any payment
under this Agreement or any other Loan Document, notice of any action at any
time taken or omitted by any Bank or the Agent under or in respect of any of the
obligations of the Borrowers under this Agreement or any other Loan Document,
any requirement of diligence and, generally, all demands, notices and other
formalities of every kind in connection with this Agreement or any other Loan
Document. Each Borrower hereby assents to, and waives notice of, any extension
or postponement of the time for the payment of any of the obligations of the
Borrowers, under this Agreement or any other Loan Document, the acceptance of
any partial payment thereon, any waiver, consent or other action or acquiescence
by any Bank at any time or times in respect of any default by any Borrower in
the performance or satisfaction of any term, covenant, condition or provision of
this Agreement or any other Loan Document, any and all other indulgences
whatsoever by any Bank in respect of any of the obligations of the Borrowers
65
under this Agreement or any other Loan Document, and the taking, addition,
substitution or release, in whole or in part, at any time or times, of any
security for any of the obligations of the Borrowers under this Agreement or the
addition, substitution or release, in whole or in part, of any Borrower. Without
limiting the generality of the foregoing, each Borrower assents to any other
action or delay in acting or failure to act on the part of any Bank, including,
without limitation, any failure strictly or diligently to assert any right or to
pursue any remedy which might, but for the provisions of this Section 9.19,
afford grounds for terminating, discharging or relieving such Borrower, in whole
or in part, from any of its obligations under this Section 9.19, it being the
intention of each Borrower that, so long as any of the obligations of the
Borrowers under this Agreement remain unsatisfied, the obligations of such
Borrower under this Section 9.19 shall not be discharged except by performance
and then only to the extent of such performance. The obligations of each
Borrower under this Section 9.19 shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement, liquidation,
reconstruction or similar proceeding with respect to any Borrower or any Bank.
The joint and several liability of the Borrowers hereunder shall continue in
full force and effect notwithstanding any absorption, merger, amalgamation or
any other change whatsoever in the name, membership, constitution or place of
formation of any Borrower or any Bank.
(f) The provisions of this Section 9.19 are made for the benefit of
the Banks and their respective successors and assigns, and may be enforced by
any such Person from time to time against any of the Borrowers as often as
occasion therefor may arise and without requirement on the part of any Bank
first to marshal any of its claims or to exercise any of its rights against any
other Borrower or to exhaust any remedies available to it against any other
Borrower or to resort to any other source or means of obtaining payment of any
of the obligations of the Borrowers under this Agreement or the other Loan
Documents or to elect any other remedy. The provisions of this Section 9.19
shall remain in effect until all the obligations of the Borrowers under this
Agreement or the other Loan Documents shall have been paid in full or otherwise
fully satisfied. If at any time, any payment, or any part thereof, made in
respect of any of the obligations of the Borrowers under this Agreement or the
other Loan Documents is rescinded or must otherwise be restored or returned by
any Bank upon the insolvency, bankruptcy or reorganization of any of the
Borrowers, or otherwise, the provisions of this Section 9.19 will forthwith be
reinstated in effect, as though such payment had not been made.
(g) Notwithstanding any provision to the contrary contained herein
or in any other of the Loan Documents, to the extent the joint obligations of
any Borrower shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of each
Borrower hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the federal Bankruptcy Code).
(h) The Borrowers hereby agree, as among themselves, that if any
Borrower shall become an Excess Funding Borrower (as defined below), the other
Borrowers shall, on demand of such Excess Funding Borrower (but subject to the
next sentence hereof and to
66
subsection (B) below), pay to such Excess Funding Borrower an amount equal to
each such Borrower's Pro Rata Share (as defined below and determined, for this
purpose, without reference to the properties, assets, liabilities and debts of
such Excess Funding Borrower) of such Excess Payment (as defined below). The
payment obligation of the other Borrowers to any Excess Funding Borrower under
this Section 9.19(h) shall be subordinate and subject in right of payment to the
proper payment in full of the obligations of such Borrowers under the other
provisions of this Agreement and the other Loan Documents, and such Excess
Funding Borrower shall not exercise any right or remedy with respect to such
excess until payment and satisfaction in full of all such obligations. For
purposes hereof, (i) "Excess Funding Borrower" shall mean, in respect of any
obligations of the Borrowers arising under the other provisions of this
Agreement (hereafter, the "Joint Obligations"), any Borrower that has paid an
amount in excess of its Pro Rata Share of the Joint Obligations; (ii) "Excess
Payment" shall mean, in respect of any Joint Obligations, the amount paid by an
Excess Funding Borrower in excess of its pro Rata Share of such Joint
Obligations; and (iii) "Pro Rata Share", for the purposes of this Section
9.19(h), shall mean, for any Borrower, the ratio (expressed as a percentage) of
(A) the amount by which the aggregate present fair saleable value of all of its
assets and properties exceeds the amount of all debts and liabilities of such
Borrower (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of such Borrower hereunder) to (B)
the amount by which the aggregate present fair saleable value of all assets and
other properties of such Borrower and the other Borrowers exceeds the amount of
all of the debts and liabilities (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Borrower and
the other Borrowers hereunder) of such Borrower and the other Borrowers, all as
of the Closing Date.
67
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, under seal, by their respective authorized officers as of the
day and year first above written.
THE VALSPAR CORPORATION
By: ___________________________(SEAL)
Title:
The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
Telephone number: 612-375-7702
ENGINEERED POLYMER SOLUTIONS, INC.
By: ___________________________(SEAL)
Title:
c/o The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
Telephone number: 612-375-7702
THE VALSPAR (UK) HOLDING CORPORATION LTD.
By: ___________________________(SEAL)
Title:
c/o The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
68
Telephone number: 612-375-7702
69
THE VALSPAR (SWITZERLAND) HOLDING
CORPORATION A.G.
By: ___________________________(SEAL)
Title:
c/o The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
Telephone number: 612-375-7702
FORTON B.V.
By: ___________________________(SEAL)
Title:
c/o The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
Telephone number: 612-375-7702
DYFLEX B.V.
By: ___________________________(SEAL)
Title:
c/o The Valspar Corporation
1101 South Third Street
Minneapolis, Minnesota 55415
Attention: Paul C. Reyelts
Vice President-Finance
Telecopy number: 612-375-7750
Telephone number: 612-375-7702
70
WACHOVIA BANK, N.A., as Administrative Agent and
Documentation Agent
By: ___________________________ (SEAL)
Title:
Notice Address
--------------
Wachovia Bank, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Manager, Syndicate Loan Services
Telecopy number: 404-332-5144
Telephone number: 404-332-4008
CHASE SECURITIES INC., as Syndication Agent
By: ___________________________ (SEAL)
Title:
Notice Address
--------------
Chase Securities Inc.
Ten South LaSalle Street
Chicago, Illinois 60603-1097
Attention: Jonathan E. Twichell
Telecopy number: 312-807-4550
Telephone number: 312-807-4038
71
WACHOVIA BANK, N. A.
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Wachovia Bank, N. A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Walter R. Gillikin
Telecopy number: 404-332-6898
Telephone number: 404-332-5747
72
THE CHASE MANHATTAN BANK
By:___________________________ (SEAL)
Title:
Lending Office
--------------
The Chase Manhattan Bank
Ten South LaSalle Street
Chicago, Illinois 60603-1097
Attention: Jonathan E. Twichell
Telecopy number: 312-807-4550
Telephone number: 312-807-4038
73
SOCIETE GENERALE
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Societe Generale
181 West Madison St., Suite 3400
Chicago, Illinois 60602
Attention: Seth F. Asofsky
Telecopy number: 312-578-5099
Telephone number: 312-578-5055
74
U. S. BANK NATIONAL ASSOCIATION
By:___________________________ (SEAL)
Title:
Lending Office
--------------
U. S. Bank National Association
First Bank Place
601 Second Avenue South
Minneapolis, Minnesota 55402-4302
Attention: Tom Cherry
Telecopy number: 612-973-0825
Telephone number: 612-973-0555
75
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Bank of America National Trust and Savings Association
231 South LaSalle Street, 14th Floor
Chicago, Illinois 60697
Attention: Barbara Salemme
Telecopy number: 312-974-9626
Telephone number: 312-828-3850
with a copy of notices to:
Bank of America National Trust and Savings Association
335 Madison Ave., 5th Floor
New York, New York 10017
Attention: David Noda
Telecopy number: 212-503-7878
Telephone number: 212-503-7948
76
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Norwest Bank Minnesota, N. A.
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0085
Attention: Ann C. Pifer
Telecopy number: 612-667-2276
Telephone number: 612-667-2893
77
THE FIRST NATIONAL BANK OF CHICAGO
By:___________________________ (SEAL)
Title:
Lending Office
--------------
The First National Bank of Chicago
One First National Plaza, Suite 0173
Chicago, Illinois 60670
Attention: J. Garland Smith
Telecopy number: 312-732-1117
Telephone number: 312-732-2735
78
BANK OF MONTREAL
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Bank of Montreal
111 West Monroe Street, FL 10 East
Chicago, Illinois 60603
Attention: Dennis Aron
Telecopy number: 312-765-8251
Telephone number: 312-461-3285
79
PNC BANK, NATIONAL ASSOCIATION
By:___________________________ (SEAL)
Title:
Lending Office
--------------
PNC Bank, National Association
1 South Wacker Drive, Suite 2980
Chicago, Illinois 60606
Attention: Greg Gaschler
Telecopy number: 312-338-5620
Telephone number: 312-338-5672
80
THE BANK OF NEW YORK
By:___________________________ (SEAL)
Title:
Lending Office
--------------
The Bank of New York
One Wall Street, 19th Floor
New York, New York 10286
Attention: Richard Rafetto
Telecopy number: 212-635-1208
Telephone number: 212-635-8044
81
SUNTRUST BANK, CENTRAL FLORIDA, N. A.
By:___________________________ (SEAL)
Title:
Lending Office
--------------
SunTrust Bank, Central Florida, N. A.
200 South Orange Avenue
Orlando, Florida 32802
Attention: Joe Kaborek
Telecopy number: 407-237-6894
Telephone number: 407-237-4284
82
BANQUE NATIONALE DE PARIS,
CHICAGO BRANCH
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Banque Nationale de Paris, Chicago Branch
209 South LaSalle Street
Chicago, Illinois 60604
Attention: Jo Ellen Bender
Telecopy number: 312-977-1380
Telephone number: 312-977-2225
83
KEYBANK NATIONAL ASSOCIATION
By:___________________________ (SEAL)
Title:
Lending Office
--------------
KeyBank National Association
127 Public Square - MC: OH-01-27-0606
Cleveland, Ohio 44114-1306
Attention: Frank Jancar
Telecopy number: 216-689-4981
Telephone number: 216-689-4442
84
BANCA NAZIONALE DEL LAVORO S.p.A.,
NEW YORK BRANCH
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Banca Nazionale del Lavoro S.p.A., New York Branch
55 West Monroe Street, Suite 3490
Chicago, Illinois 60603
Attention: Stefano Carsetti
Telecopy number: 312-444-9410
Telephone number: 312-444-9250
85
FIRSTAR BANK OF MINNESOTA, N. A.
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Firstar Bank of Minnesota, N. A.
101 East Fifth Street
St. Paul, Minnesota 55101
Attention: Karen Paris
Telecopy number: 651-298-6351
Telephone number: 651-225-3842
86
ABN AMRO BANK N.V.
By:___________________________ (SEAL)
Title:
By:___________________________ (SEAL)
Title:
Lending Office
--------------
ABN AMRO Bank N. V.
208 S. LaSalle Street, Suite 1500
Chicago, Illinois 60604
Attention: Loan Administration
Telecopy number: 312-992-5155
Telephone number: 312-992-5150
with a copy of notices to:
ABN AMRO Bank N. V.
4100 U. S. Bank Place
601 Second Avenue South
Minneapolis, Minnesota 55402
Attention: Peter Eaton, Vice President
Telecopy number: 612-338-8687
Telephone number: 612-337-9865
87
WESTDEUTSCHE LANDESBANK GIROZENTRALE
By:___________________________ (SEAL)
Title:
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Westdeutsche Landesbank Girozentrale
1211 Avenue of the Americas
New York, New York 10036
Attention: Phillip Green
Telecopy number: 212-302-7946
Telephone number: 212-852-6113
with a copy of notices to:
Westdeutsche Landesbank Girozentrale
233 South Wacker Drive, Suite 5210
Chicago, Illinois 60606
Attention: John Hall
Telecopy number: 312-930-9281
Telephone number: 312-930-9200
88
DG BANK
DEUTSCHE GENOSSENSCHAFTSBANK AG
By:___________________________ (SEAL)
Title:
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Deutsche Genossenschaftsbank A. G., New York Branch
609 Fifth Avenue
New York, New York 10017
Attention: Mark Connelly
Telecopy number: 212-745-1550
Telephone number: 212-745-1560
89
CLYDESDALE BANK PLC
By:___________________________ (SEAL)
Title:
Lending Office
--------------
Clydesdale Bank PLC
c/o National Australia Bank Limited
200 Park Avenue, 34th Floor
New York, New York 10166
Attention: Loan Services
Telecopy number: 212-916-9636
Telephone number: 212-916-9500
with a copy of notices to:
Clydesdale Bank
10 Fleet Place
London EC4M 7RB
United Kingdom
Attention: Hillary King
Telecopy number: 00 44 171 395 5619
Telephone number: 00 44 171 395 5608
- -----------------
TOTAL COMMITMENTS:
$450,000,000
90
Schedule 1.01
Material Subsidiaries
Engineered Polymer Solutions, Inc.
Valspar Finance Corp.
Valspar Coatings Finance Corp.
Schedule 4.08
Existing Subsidiaries
(List sets forth each such Subsidiary's complete name and jurisdiction of
incorporation)
Valspar Refinish, Inc. Mississippi
Engineered Polymer Solutions, Inc. Delaware
The Valspar (Singapore) Corporation Pte. Ltd. Singapore
Valspar, Inc. Canada
The Valspar (UK) Holding Corporation Limited United Kingdom
Valspar Finance Corporation Minnesota
The Valspar (H.K.) Corporation Limited Hong Kong
Valspar Export, Inc. USVI
Plasti-Kote Co., Inc. Ohio
Valspar (Australia) Holdings Pty. Limited Australia
Valspar (Australia) Acquisition Pty. Limited Australia
The Valspar (Australia) Corporation Pty. Limited Australia
Forton B.V. Netherlands
Valspar Coatings Finance Corp. Minnesota
The Valspar (UK) Corporation, Limited United Kingdom
The Valspar (France) Corporation, S.A. France
The Valspar (Norway) Corporation A.S. Norway
The Valspar (Germany) Corporation GmbH Germany
The Valspar (Spain) Corporation, Srl Spain
Valspar U.K. Finco Limited Partnership United Kingdom
Valspar (Switzerland) Holding Corp. A.G. Switzerland
The Valspar (Italy) Corp. Srl Italy
Valspar Marlux, S.A. de C.V. Mexico
Valspar Renner Revestimentos para Embalagens Limitada Brazil
Valspar Renner (Uruguay) S.A. Uruguay
Sworny A.S. Denmark
Plasti-Kote, Ltd. United Kingdom
Valspar Hai Hong company Limited Hong Kong
Valspar Hai Hong Coatings (Shenzhen) Company Limited PRC
Dyflex B.V. Netherlands
Dexter Subsidiaries:
Dexter GmbH Austria
Dexter do Brasil Ltda Brazil
Dexter International (Thailand), Ltd. Thailand
Dexter Mexicana S.A. de C.V. Mexico
Dexter Packaging Products, S.A. Spain
Dexter SAS France
Kolack A.G. Switzerland
Vernicolor A.G. Switzerland
Dexter Midland Co. Ltd. Japan
Dexter South Africa (Pty) Limited South Africa
Schedule 4.14
Environmental Matters
Borrower is a potentially responsible party under CERCLA or state law at several
superfund sites, some of which matters have now been closed and of the open
matters, none of them has caused or is reasonably expected to cause a Material
Adverse Effect.
Remedial activities are underway at Borrower's Chicago, IL; Azusa, CA; Kankakee,
IL; East Moline, IL; Los Angeles, CA; Baltimore, MD and Tampa, FL plants.
Remedial activities are anticipated at Borrower's Toronto, Canada plant.
Borrower's Tampa, FL and Baltimore, MD plants are listed on the state superfund
list.
Environmental Authorization is being applied for in anticipation of expansion at
Borrower's Picayune, MS plant.
While Borrower's policy is to comply with Environment Requirements as soon as
practical, there have been and may be occasions where compliance is delayed by
such factors as scheduling requirements of disposal companies, weather or
uncertainty as to specific compliance requirements. From time to time, Borrower
contests in good faith the specific procedures or requirements for compliance
with Environmental Requirements.
EXHIBIT A
SYNDICATED DOLLAR NOTE
$____________ Atlanta, Georgia
February 26, 1999
For value received, THE VALSPAR CORPORATION, ENGINEERED POLYMER
SOLUTIONS, INC., THE VALSPAR (UK) HOLDING CORPORATION LTD., THE VALSPAR
(SWITZERLAND) HOLDING CORPORATION A.G., FORTON B.V. and DYFLEX B.V.
(collectively, the "Borrowers"), promise to pay to the order of ________________
(the "Bank"), for the account of its Lending Office, the principal sum of
________________ ______________________________ and No/100 Dollars ($_________),
or such lesser amount as shall equal the unpaid principal amount of each
Syndicated Dollar Loan made by the Bank pursuant to the Credit Agreement
referred to below, on the dates and in the amounts provided in the Credit
Agreement. The Borrowers promise to pay interest on the unpaid principal amount
of this Syndicated Dollar Note on the dates and at the rate or rates provided
for in the Credit Agreement. Interest on any overdue principal of and, to the
extent permitted by law, overdue interest on the principal amount hereof shall
bear interest at the Default Rate, as provided for in the Credit Agreement. All
such payments of principal and interest shall be made in lawful money of the
United States in Federal or other immediately available funds at the office of
Wachovia Bank, N.A., 191 Peachtree Street, N.E., Atlanta, Georgia 30303, or such
other address as may be specified from time to time pursuant to the Credit
Agreement.
All Syndicated Dollar Loans made by the Bank, the respective maturities
thereof, the interest rates from time to time applicable thereto and all
repayments of the principal thereof shall be recorded by the Bank and, prior to
any transfer hereof, endorsed by the Bank on the schedule attached hereto, or on
a continuation of such schedule attached to and made a part hereof; provided
that the failure of the Bank to make, or any error of the Bank in making, any
such recordation or endorsement shall not affect the obligations of the
Borrowers hereunder or under the Credit Agreement.
This Syndicated Dollar Note is one of the Syndicated Dollar Notes
referred to in the Amended and Restated Credit Agreement dated as of February
26, 1999, among the Borrowers, the Banks listed on the signature pages thereof,
Chase Securities Inc., as Syndication Agent, and Wachovia Bank, N.A., as
Administrative Agent and Documentation Agent (as the same may be amended or
modified from time to time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings. Reference is made to the
Credit Agreement for provisions for the prepayment and the repayment hereof and
the acceleration of the maturity hereof.
The Borrowers hereby waive presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent
as otherwise may be expressly provided for in the Credit Agreement.
The Borrowers agree, in the event that this Syndicated Dollar Note or
any portion hereof is collected by law or through an attorney at law, to pay all
reasonable costs of collection, including, without limitation, reasonable
attorneys' fees.
Pursuant to Section 9.19 of the Credit Agreement, each of the Borrowers
jointly and severally hereby irrevocably and unconditionally accepts, not merely
as a surety but also as a co-debtor, joint and several liability with the other
Borrowers with respect to the payment and performance of all of the obligations
of all Borrowers under this Syndicated Dollar Note, it being the intention of
the Borrowers that all such obligations shall be the joint and several
obligations of each of the Borrowers without preferences or distinction between
them. The joint and several liability of the Borrowers hereunder shall be
subject to and governed by the provisions set forth in Section 9.19 of the
Credit Agreement which are incorporated herein by this reference.
[Remainder of this page intentionally left blank]
IN WITNESS WHEREOF, the Borrowers have caused this Syndicated Dollar
Note to be duly executed under seal, by their respective duly authorized
officers as of the day and year first above written.
THE VALSPAR CORPORATION
By: ___________________________(SEAL)
Title:
ENGINEERED POLYMER SOLUTIONS, INC.
By: ___________________________(SEAL)
Title:
THE VALSPAR (UK) HOLDING CORPORATION LTD.
By: ___________________________(SEAL)
Title:
THE VALSPAR (SWITZERLAND) HOLDING
CORPORATION A.G.
By: ___________________________(SEAL)
Title:
FORTON B.V.
By: ___________________________(SEAL)
Title:
DYFLEX B.V.
By: ___________________________(SEAL)
Title:
Syndicated Dollar Note (cont'd)
SYNDICATED DOLLAR LOANS AND PAYMENTS OF PRINCIPAL
- --------------------------------------------------------------------------------
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan(1) Rate Loan Repaid Date Made By
- ---- ---- -------- ------ --------- --------- --------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ----------------------------
(1) I.e., a Base Rate or Euro-Dollar Loan.
EXHIBIT B
SYNDICATED FOREIGN CURRENCY NOTE
Atlanta, Georgia
February 26, 1999
For value received, THE VALSPAR CORPORATION, ENGINEERED POLYMER
SOLUTIONS, INC., THE VALSPAR (UK) HOLDING CORPORATION LTD., THE VALSPAR
(SWITZERLAND) HOLDING CORPORATION A.G., FORTON B.V. and DYFLEX B.V.
(collectively, the "Borrowers"), promise to pay to the order of ________________
(the "Bank"), for the account of its Lending Office, the outstanding principal
amount of each Syndicated Foreign Currency Loan made by the Bank pursuant to the
Credit Agreement referred to below, on the dates and in the amounts provided in
the Credit Agreement. The Borrowers promise to pay interest on the unpaid
principal amount of this Syndicated Foreign Currency Note on the dates and at
the rate or rates provided for Syndicated Foreign Currency Loans in the Credit
Agreement. Interest on any overdue principal of and, to the extent permitted by
law, overdue interest on the principal amount hereof shall bear interest at the
Default Rate, as provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the applicable Foreign
Currency in immediately available funds at the office of Wachovia Bank, N.A.,
191 Peachtree Street, N.E., Atlanta, Georgia 30303, or such other address as may
be specified from time to time pursuant to the Credit Agreement.
All Syndicated Foreign Currency Loans made by the Bank, the respective
maturities thereof, the interest rates from time to time applicable thereto, and
all repayments of the principal thereof shall be recorded by the Bank and, prior
to any transfer hereof, endorsed by the Bank on the schedule attached hereto, or
on a continuation of such schedule attached to and made a part hereof; provided,
that the failure of the Bank to make any such recordation or endorsement shall
not affect the obligations of the Borrowers hereunder or under the Credit
Agreement.
This Syndicated Foreign Currency Note is one of the Syndicated Foreign
Currency Notes referred to in the Amended and Restated Credit Agreement dated as
of February 26, 1999, among the Borrowers, the Banks listed on the signature
pages thereof, Chase Securities Inc., as Syndication Agent, and Wachovia Bank,
N.A., as Administrative Agent and Documentation Agent (as the same may be
amended and modified from time to time, the Credit Agreement). Terms defined in
the Credit Agreement are used herein with the same meanings. Reference is made
to the Credit Agreement for provisions for the optional and mandatory prepayment
and the repayment hereof and the acceleration of the maturity hereof.
The Borrowers hereby waive presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as otherwise may be expressly provided for in the
Credit Agreement.
The Borrowers agree, in the event that this Syndicated Foreign Currency
Note or any portion hereof is collected by law or through an attorney at law, to
pay all reasonable costs of collection, including, without limitation,
reasonable attorneys' fees.
Pursuant to Section 9.19 of the Credit Agreement, each of the Borrowers
jointly and severally hereby irrevocably and unconditionally accepts, not merely
as a surety but also as a co-debtor, joint and several liability with the other
Borrowers with respect to the payment and performance of all of the obligations
of all Borrowers under this Syndicated Foreign Currency Note, it being the
intention of the Borrowers that all such obligations shall be the joint and
several obligations of each of the Borrowers without preferences or distinction
between them. The joint and several liability of the Borrowers hereunder shall
be subject to and governed by the provisions set forth in Section 9.19 of the
Credit Agreement which are incorporated herein by this reference.
[Remainder of this page intentionally left blank]
IN WITNESS WHEREOF, the Borrowers have caused this Syndicated Foreign
Currency Note to be duly executed under seal, by their respective duly
authorized officers as of the day and year first above written.
THE VALSPAR CORPORATION
By: ___________________________(SEAL)
Title:
ENGINEERED POLYMER SOLUTIONS, INC.
By: ___________________________(SEAL)
Title:
THE VALSPAR (UK) HOLDING CORPORATION LTD.
By: ___________________________(SEAL)
Title:
THE VALSPAR (SWITZERLAND) HOLDING
CORPORATION A.G.
By: ___________________________(SEAL)
Title:
FORTON B.V.
By: ___________________________(SEAL)
Title:
DYFLEX B.V.
By: ___________________________(SEAL)
Title:
Syndicated Foreign Currency Note (cont'd)
SYNDICATED FOREIGN CURRENCY LOANS AND PAYMENTS OF PRINCIPAL
- --------------------------------------------------------------------------------
Type of Amount of Amount of
Foreign Interest Loan and Principal Maturity Notation
Date Currency Rate Foreign Currency Repaid Date Made By
- ---- -------- -------- ---------------- --------- -------- --------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EXHIBIT C
MONEY MARKET NOTE
$450,000,000 Atlanta, Georgia
February 26, 1999
For value received, THE VALSPAR CORPORATION, ENGINEERED POLYMER
SOLUTIONS, INC., THE VALSPAR (UK) HOLDING CORPORATION LTD., THE VALSPAR
(SWITZERLAND) HOLDING CORPORATION A.G., FORTON B.V. and DYFLEX B.V.
(collectively, the "Borrowers"), promise to pay to the order of ________________
(the "Bank"), for the account of its Lending Office, the principal sum of Four
Hundred Fifty Million and No/100 Dollars ($450,000,000.00), or such lesser
amount as shall equal the unpaid principal amount of each Money Market Loan made
by the Bank pursuant to the Credit Agreement referred to below, on the dates and
in the amounts provided in the Credit Agreement. The Borrowers promise to pay
interest on the unpaid principal amount of this Money Market Note on the dates
and at the rate or rates provided for in the Credit Agreement. Interest on any
overdue principal of and, to the extent permitted by law, overdue interest on
the principal amount hereof shall bear interest at the Default Rate, as provided
for in the Credit Agreement. All such payments of principal and interest shall
be made in lawful money of the United States in Federal or other immediately
available funds at the office of Wachovia Bank, N.A., 191 Peachtree Street,
N.E., Atlanta, Georgia 30303, or such other address as may be specified from
time to time pursuant to the Credit Agreement.
All Money Market Loans made by the Bank, the respective maturities
thereof, the interest rates from time to time applicable thereto and all
repayments of the principal thereof shall be recorded by the Bank and, prior to
any transfer hereof, endorsed by the Bank on the schedule attached hereto, or on
a continuation of such schedule attached to and made a part hereof; provided
that the failure of the Bank to make, or any error of the Bank in making, any
such recordation or endorsement shall not affect the obligations of the
Borrowers hereunder or under the Credit Agreement.
This Money Market Note is one of the Money Market Notes referred to in
the Amended and Restated Credit Agreement dated as of February 26, 1999, among
the Borrowers, the Banks listed on the signature pages thereof, Chase Securities
Inc., as Syndication Agent, and Wachovia Bank, N.A., as Administrative Agent and
Documentation Agent (as the same may be amended or modified from time to time,
the "Credit Agreement"). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit Agreement for provisions
for the prepayment and the repayment hereof and the acceleration of the maturity
hereof.
The Borrowers hereby waive presentment, demand, protest, notice of
demand, protest and nonpayment and any other notice required by law relative
hereto, except to the extent as
otherwise may be expressly provided for in the Credit Agreement.
The Borrowers agree, in the event that this Money Market Note or any
portion hereof is collected by law or through an attorney at law, to pay all
reasonable costs of collection, including, without limitation, reasonable
attorneys' fees.
Pursuant to Section 9.19 of the Credit Agreement, each of the Borrowers
jointly and severally hereby irrevocably and unconditionally accepts, not merely
as a surety but also as a co-debtor, joint and several liability with the other
Borrowers with respect to the payment and performance of all of the obligations
of all Borrowers under this Money Market Note, it being the intention of the
Borrowers that all such obligations shall be the joint and several obligations
of each of the Borrowers without preferences or distinction between them. The
joint and several liability of the Borrowers hereunder shall be subject to and
governed by the provisions set forth in Section 9.19 of the Credit Agreement
which are incorporated herein by this reference.
[Remainder of this page intentionally left blank]
IN WITNESS WHEREOF, the Borrowers have caused this Money Market Note to
be duly executed under seal, by their respective duly authorized officers as of
the day and year first above written.
THE VALSPAR CORPORATION
By: ___________________________(SEAL)
Title:
ENGINEERED POLYMER SOLUTIONS, INC.
By: ___________________________(SEAL)
Title:
THE VALSPAR (UK) HOLDING CORPORATION LTD.
By: ___________________________(SEAL)
Title:
THE VALSPAR (SWITZERLAND) HOLDING
CORPORATION A.G.
By: ___________________________(SEAL)
Title:
FORTON B.V.
By: ___________________________(SEAL)
Title:
DYFLEX B.V.
By: ___________________________(SEAL)
Title:
Money Market Note (cont'd)
MONEY MARKET LOANS AND PAYMENTS OF PRINCIPAL
- --------------------------------------------------------------------------------
Amount Amount of
Interest of Principal Maturity Notation
Date Rate Loan Repaid Date Made By
- ---- -------- ------ --------- -------- --------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EXHIBIT D
OPINIONS OF
COUNSEL FOR THE BORROWERS AND THE GUARANTORS
[See Item 8 of the Closing Transcript]
EXHIBIT E
OPINION OF
WOMBLE CARLYLE SANDRIDGE & RICE, PLLC
SPECIAL COUNSEL FOR THE AGENT
[Date as provided in Section 3.01 of the Credit Agreement]
To the Banks and the Administrative Agent
Referred to Below
c/o Wachovia Bank, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Dear Sirs:
We have participated in the preparation of the Amended and Restated
Credit Agreement (the "Credit Agreement") dated as of February 26, 1999, among
The Valspar Corporation, a Delaware corporation, and the other Borrowers
referred to therein (the "Borrowers"), the Banks listed on the signature pages
thereof (the "Banks"), Chase Securities Inc., as Syndication Agent, and Wachovia
Bank, N.A., as Administrative Agent and Documentation Agent (the "Agent"), and
have acted as special counsel for the Agent for the purpose of rendering this
opinion pursuant to Section 3.01(d) of the Credit Agreement. Terms defined in
the Credit Agreement are used herein as therein defined.
This opinion letter is limited by, and is in accordance with, the
January 1, 1992 edition of the Interpretive Standards applicable to Legal
Opinions to Third Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State Bar of Georgia
which Interpretive Standards are incorporated herein by this reference.
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, and assuming the due authorization,
execution and delivery of the Credit Agreement and each of the Notes by or on
behalf of the Borrowers, we are of the opinion that the Credit Agreement
constitutes a valid and binding agreement of the Borrowers and each Note
constitutes valid and binding obligations of the Borrowers, in each case
enforceable in accordance with its terms except as: (i) the enforceability
thereof may be affected by bankruptcy, insolvency, reorganization, fraudulent
conveyance, voidable preference, moratorium or similar laws applicable to
creditors' rights or the collection of debtors' obligations generally; (ii)
rights of acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability; and (iii) the enforceability
of certain of the remedial, waiver and other provisions of the Credit Agreement
and the Notes may be further limited by the laws of the State of Georgia;
provided, however, such additional laws do not, in our opinion, substantially
interfere with the practical realization of the benefits expressed in the Credit
Agreement and the Notes, except for the economic consequences of any procedural
delay which may result from such laws.
In giving the foregoing opinion, we express no opinion as to the effect
(if any) of any law of any jurisdiction except the State of Georgia. We express
no opinion as to the effect of the compliance or noncompliance of the Agent or
any of the Banks with any state or federal laws or regulations applicable to the
Agent or any of the Banks by reason of the legal or regulatory status or the
nature of the business of the Agent or any of the Banks.
This opinion is delivered to you in connection with the transaction
referenced above and may only be relied upon by you and any Assignee,
Participant or other Transferee under the Credit Agreement without our prior
written consent.
Very truly yours,
WOMBLE CARLYLE SANDRIDGE & RICE
A PROFESSIONAL LIMITED LIABILITY COMPANY
By:
------------------------------
James E. Lilly, Member
EXHIBIT F
MONEY MARKET QUOTE REQUEST
[Date]
To: Wachovia Bank, N.A.,
as Administrative Agent
From: [Insert Name of Borrower]
Re: Money Market Quote Request
Pursuant to Section 2.03 of the Amended and Restated Credit Agreement
(the "Credit Agreement") dated as of February 26, 1999, among The Valspar
Corporation, the other Borrowers referred to therein, the Banks listed on the
signature pages thereof, Chase Securities Inc., as Syndication Agent, and
Wachovia Bank, N.A., as Administrative Agent and Documentation Agent, we hereby
give notice that we request Money Market Quotes for the following proposed Money
Market Borrowing(s)
Date of Borrowing:
Principal Amount(2) Interest Period(3)
- ---------------- ---------------
Terms used herein have the meanings assigned to them in the Credit
Agreement.
[Insert Name of Borrower]
By:
------------------------------
Title:
- --------------------------
(2) Amount must be $5,000,000 or a larger multiple of $1,000,000.
(3) A period of 7 to 180 days.
EXHIBIT G
MONEY MARKET QUOTE
Wachovia Bank, N.A.,
as Administrative Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention:
Re: Money Market Quote to [Insert Name of Borrower] (the "Borrower")
This Money Market Quote is given in accordance with Section 2.03(c)(ii)
of the Amended and Restated Credit Agreement (the "Credit Agreement") dated as
of February 26, 1999, among The Valspar Corporation, the other Borrowers
referred to therein, the Banks listed on the signature pages thereof (the
"Banks") Chase Securities Inc., as Syndication Agent, and Wachovia Bank, N.A.,
as Administrative Agent and Documentation Agent. Terms defined in the Credit
Agreement are used herein as defined therein.
In response to the Borrower's invitation dated ____________ __, 19__,
we hereby make the following Money Market Quote on the following terms:
1. Quoting Bank:
2. Person to contact at Quoting Bank:
3. Date of Borrowing: (1*)
4. We hereby offer to make Money Market Loan(s) in the following
minimum and maximum principal amounts, for the following Interest Periods and at
the following rates:
Minimum Maximum
Principal Principal Interest
Amount(2) Amount(2) Period(3) Interest Rate
- --------- --------- -------- -------------
- --------------------------
* All numbered footnotes appear on the last page of this Exhibit.
We understand and agree that the offer(s) set forth above, subject to
the satisfaction of the applicable conditions set forth in the Credit Agreement,
irrevocably obligate(s) us to make the Money Market Loan(s) for which any
offer(s) [is] [are] accepted, in whole or in part (subject to the third sentence
of Section 2.03(e) of the Credit Agreement).
Very truly yours,
[Name of Bank]
Dated: By:
-----------------------------
- ------------------------- Authorized Officer
- -------------------------
(1) As specified in the related Money Market Quote Request.
(2) The principal amount bid for each Interest Period may not exceed
the principal amount requested. Bids must be made for at least $1,000,000 or a
larger multiple of $1,000,000.
(3) A period of 7 to 180 days.
EXHIBIT H
CLOSING CERTIFICATE
OF
THE VALSPAR CORPORATION
Reference is made to the Amended and Restated Credit Agreement (the
"Credit Agreement") dated as of February 26, 1999, among The Valspar Corporation
(the "Parent"), the other Borrowers referred to therein, Chase Securities Inc.,
as Syndication Agent, Wachovia Bank, N.A., as Administrative Agent and
Documentation Agent and as a Bank, and certain other Banks listed on the
signature pages thereof. Capitalized terms used herein have the meanings
ascribed thereto in the Credit Agreement.
Pursuant to Section 3.01(g) of the Credit Agreement, _________________,
the duly authorized ____________________ of the Parent, hereby certifies to the
Agent and the Banks that: (i) no Default has occurred and is continuing on the
date hereof; and (ii) the representations and warranties of the Parent contained
in Article IV of the Credit Agreement are true on and as of the date hereof.
Certified as of the 26th day of February, 1999.
THE VALSPAR CORPORATION
--------------------------------------
Name:
Title:
EXHIBIT I
[NAME OF BORROWER/GUARANTOR]
Officer's Certificate
This certificate is delivered in connection with that certain Amended
and Restated Credit Agreement, dated as of February 26, 1999 (the "Credit
Agreement"), among ___________________, a _______________ [corporation] (the
"Borrower"), the other Borrowers referred to therein, Chase Securities Inc., as
Syndication Agent, Wachovia Bank, N. A., as the Administrative Agent and
Documentation Agent and a Bank, and the Banks from time to time party thereto.
Terms defined in the Credit Agreement are used herein as therein defined.
I, ___________________, the Secretary of the Borrower [Name of
Guarantor, a ____________ corporation (the "Guarantor")], DO HEREBY CERTIFY
that:
1. Attached hereto as Exhibit A is a true, correct and complete copy of
the Certificate of Incorporation of the Borrower [Guarantor], certified by the
Secretary of State of the State of Delaware [_____________]. There has been no
amendment of, or other document affecting, the Certificate of Incorporation of
the Borrower [Guarantor] since __________________. I know of no proceeding for
the dissolution or liquidation of the Borrower [Guarantor] or threatening its
existence and, to the best of my knowledge, the Borrower [Guarantor] is a
corporation duly incorporated and validly existing under and by virtue of the
laws of the State of Delaware [____________] and is in good standing in that
State.
2. Attached hereto as Exhibit B is a true, correct and complete copy of
the by-laws of the Borrower [Guarantor] as in effect on the date hereof.
3. Attached hereto as Exhibit C is a true, correct and complete copy of
resolutions (including exhibits, if any, thereto) duly adopted, effective
______________, at a regular meeting of the Board of Directors of the Borrower
[Guarantor], duly called and held on ______________, at which a quorum was
present and acting throughout. Said resolutions have not been in any way
amended, annulled, rescinded or revoked and are still in full force and effect;
and there exist no other resolutions of the Board of Directors of the Borrower
[Guarantor] relating to the matters set forth in said resolutions.
4. The below-named persons have been duly elected, have duly qualified,
and this day are, and at all times since _________________ have been officers of
the Borrower [Guarantor], holding the respective offices set forth below
opposite their names, and the signatures set opposite their names are their
genuine signatures:
NAME OFFICE SIGNATURE
---- ------ ---------
- ------------------ ------------------------- -----------------------
- ------------------ ------------------------- -----------------------
- ------------------ ------------------------- -----------------------
WITNESS my hand and the seal of the Borrower [Guarantor] this 26th day
of February, 1999.
[SEAL]
------------------------------
, Secretary
--------------------------
I, the undersigned, the _____________ of the above-named corporation,
DO HEREBY CERTIFY that ______________________ has been duly elected, has duly
qualified, and this day is the Secretary of said corporation, and that the
signature above is his genuine signature.
WITNESS my hand this 26th day of February, 1999.
-------------------------------------
Name:
Title:
EXHIBIT J
COMPLIANCE CERTIFICATE
Reference is made to the Amended and Restated Credit Agreement dated as
of February 26, 1999 (as modified and supplemented and in effect from time to
time, the "Credit Agreement") among The Valspar Corporation, the other Borrowers
referred to therein, the Banks from time to time parties thereto, Chase
Securities Inc., as Syndication Agent, and Wachovia Bank, N.A., as
Administrative Agent and Documentation Agent. Capitalized terms used herein
shall have the meanings ascribed thereto in the Credit Agreement.
Pursuant to Section 5.01(b) of the Credit Agreement, ____________, the
duly authorized [chief financial officer/treasurer/chief accounting officer] of
The Valspar Corporation, hereby certifies that the consolidated balance sheet of
the Parent and its Consolidated Subsidiaries as of the end of the Fiscal Quarter
just ended and the related statement of income and statement of cash flows
furnished to each of the Banks simultaneously herewith are fairly presented,
prepared in accordance with GAAP, applied on a basis consistent with the most
recent audited consolidated financial statements of the Parent and its
Consolidated Subsidiaries (subject to normal year-end adjustments).
Pursuant to Section 5.01(c) of the Credit Agreement, ____________, the
duly authorized [chief financial officer/treasurer/chief accounting officer] of
The Valspar Corporation, hereby (i) certifies to the Agent and the Banks that
the information contained in the Compliance Check List attached hereto is true,
accurate and complete as of _______, ___, and that no Default is in existence on
and as of the date hereof and (ii) restates and reaffirms that the
representations and warranties contained in Article IV of the Credit Agreement
are true on and as of the date hereof as though restated on and as of this date
[except as] [disclosed in a prior Compliance Certificate] [set forth below].
THE VALSPAR CORPORATION
By:
------------------------
[chief financial officer/treasurer/
chief accounting officer]
COMPLIANCE CHECK LIST
The Valspar Corporation
------------------
________, ___
1. Subsidiaries (Section 4.08)
The Parent has no Subsidiaries except for those Subsidiaries listed on
Schedule 4.08, or as described in a Compliance Certificate furnished
pursuant to Section 5.01(c), in each case which accurately sets forth
each such Subsidiary's complete name and jurisdiction of incorporation.
New Subsidiaries not listed on Schedule 5.01(c) or in a prior
Compliance Certificate:
Domestic Subsidiaries
---------------------
Name Jurisdiction of Incorporation
---- -----------------------------
--------------- -----------------
Foreign Subsidiaries
--------------------
Name Jurisdiction of Incorporation
---- -----------------------------
--------------- -----------------
2. Ratio of Consolidated Debt to Consolidated EBITDA (Section 5.03)
The ratio of Consolidated Debt to Consolidated EBITDA for the period of
four consecutive Fiscal Quarters most recently ended will not at any
time exceed 3.50 to 1.00.
(a) Consolidated Debt Schedule 1 $
------
(b) Consolidated EBITDA Schedule 2 $
------
Actual Ratio of (a) to (b)
------
Maximum Ratio 3.50 to 1.0
COMPLIANCE CHECK LIST
The Valspar Corporation
----------------------------
________________, ____
3. Minimum Shareholders' Equity (Section 5.04)
Shareholders' Equity will at no time be less than $257,234,000 plus the
sum of (i) 50% of the cumulative Reported Net Income of the Parent and
its Consolidated Subsidiaries during any period after July 31, 1998
(taken as one accounting period), calculated quarterly but excluding
from such calculations of Reported Net Income for purposes of this
clause (i), any quarter in which the Reported Net Income of the Parent
and its Consolidated Subsidiaries is negative, and (ii) 100% of the
cumulative Net Proceeds of Capital Stock received during any period
after the Closing Date, calculated quarterly.
(a) Shareholders' Equity $
------
(b) 50% of cumulative positive Reported
Net Income after July 31, 1998 $
------
(c) 100% of cumulative Net Proceeds of Capital
Stock issued after the Closing Date $
------
(d) $257,234,000
Required Shareholders' Equity
(sum of (b) plus (c) plus (d)) $
------
COMPLIANCE CHECK LIST
The Valspar Corporation
----------------------------
________________, ____
Schedule 1
Consolidated Debt
- -----------------
INTEREST
RATE MATURITY TOTAL
-------- -------- -----
Borrowed Money or Bonds, Debentures,
- ------------------------------------
Notes or Similar Instruments
- ----------------------------
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
Total Borrowed Money $
-----
Capital Leases
- --------------
(4) $
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
Total Capital Leases $
-----
Total Reimbursement Obligations $
-----
Guaranteed Obligations
- ----------------------
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
$
- ---------------- ----- ----- -----
Total Guaranteed Obligations $
-----
Consolidated Debt $
=====
Schedule 2
- -----------------------------
(4) Use implicit interest rate for capital leases
CONSOLIDATED EBITDA
- -------------------
(a) ___ quarter 199_
Consolidated Net Income $________
Consolidated Interest Expense $________
Depreciation $________
Amortization $________
Tax Expense $________
(b) ___ quarter 199_
Consolidated Net Income $________
Consolidated Interest Expense $________
Depreciation $________
Amortization $________
Tax Expense $________
(c) ___ quarter 199_
Consolidated Net Income $________
Consolidated Interest Expense $________
Depreciation $________
Amortization $________
Tax Expense $________
(d) ___ quarter 199_
Consolidated Net Income $________
Consolidated Interest Expense $________
Depreciation $________
Amortization $________
Tax Expense $________
Total for Quarter $__________
Consolidated EBITDA $
(sum of (a) plus (b) plus (c) plus (d)) ==========
EXHIBIT K
ASSIGNMENT AND ACCEPTANCE
Dated ________________ __, ____
Reference is made to the Amended and Restated Credit Agreement dated as
of February 26, 1999 (together with all amendments and modifications thereto,
the "Credit Agreement") among The Valspar Corporation, a Delaware corporation
(the "Parent"), the other Borrowers referred to therein, the Banks (as defined
in the Credit Agreement), Chase Securities Inc., as Syndication Agent, and
Wachovia Bank, N.A., as Administrative Agent and Documentation Agent (the
"Agent"). Terms defined in the Credit Agreement are used herein with the same
meaning.
_____________________________________________________ (the "Assignor")
and _____________________________________________ (the "Assignee") agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse to the Assignor, 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) (including, without limitation, a ______% interest (which on the
Effective Date hereof is $_______________) in the Assignor's Commitment and a
______% interest (which on the Effective Date hereof is $_______________) in the
Syndicated Dollar Loans owing to the Assignor and a ___% interest (which on the
Effective Date hereof has a Dollar Equivalent amount of $________) in the
Syndicated Foreign Currency Loans owing to the Assignor [and a ___% interest in
the Money Market Loans owing to the Assignor] and a ______% interest in the
Syndicated Dollar Note held by the Assignor (which on the Effective Date hereof
is $__________________)) and in the Syndicated Foreign Currency Note held by the
Assignor (which on the Effective Date has a Dollar Equivalent amount of
$_______).
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, any other instrument or
document furnished pursuant thereto or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement, any
other Loan Document or any other instrument or document furnished pursuant
thereto, other than that it is the legal and beneficial owner of the interest
being assigned by it hereunder, that such interest is free and clear of any
adverse claim and that as of the date hereof its Commitment (without giving
effect to assignments thereof which have not yet become effective) is
$_________________ and the aggregate outstanding principal amount of Syndicated
Dollar Loans, Syndicated Foreign Currency Loans [and Money Market Loans] owing
to it (without giving effect to assignments thereof which have not yet become
effective) is $_________________; (ii) makes no representation or warranty and
assumes no responsibility
with respect to the financial condition of the Borrowers or the performance or
observance by the Borrowers of any of its obligations under the Credit
Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto; and (iii) attaches the Note[s] referred to in paragraph 1
above and requests that the Agent exchange such Note[s] as follows: [a new
Syndicated Dollar Note dated _______________, ____ in the principal amount of
_________________ payable to the order of the Assignee] [new Syndicated Dollar
Notes as follows: a Syndicated Dollar Note dated _________________, ____ in the
principal amount of $_______________ payable to the order of the Assignor and a
Syndicated Dollar Note dated ______________, ____ in the principal amount of
$______________ payable to the order of the Assignee] [a new Syndicated Foreign
Currency Note dated ________, ____, payable to the order of the Assignee] [new
Syndicated Foreign Currency Notes as follows: a new Syndicated Foreign Currency
Note dated __________, ____, payable to the order of the Assignor and a
Syndicated Foreign Currency Note dated __________, ____, payable to the order of
the Assignee] [and a new Money Market Note dated _______, ____ in the principal
of $_________ payable to the order of the Assignee].
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.04(a) thereof (or any more recent financial statements of the Parent
delivered pursuant to Section 5.01(a) or (b) thereof) and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any other
Bank 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 Credit Agreement; (iii) confirms that it is a bank or financial
institution; (iv) appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; (v) 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 as a Bank; (vi) specifies as its
Lending Office (and address for notices) the office set forth beneath its name
on the signature pages hereof, (vii) represents and warrants that the execution,
delivery and performance of this Assignment and Acceptance are within its
corporate powers and have been duly authorized by all necessary corporate
action[, and (viii) attaches the forms prescribed by the Internal Revenue
Service of the United States certifying as to the Assignee's status for purposes
of determining exemption from United States withholding taxes with respect to
all payments to be made to the Assignee under the Credit Agreement and the Notes
or such other documents as are necessary to indicate that all such payments are
subject to such taxes at a rate reduced by an applicable tax treaty].(5)
4. The Effective Date for this Assignment and Acceptance shall be
- --------------------------
(5) If the Assignee is organized under the laws of a jurisdiction
outside the United States.
_______________ (the "Effective Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the Agent for execution and
acceptance by the Agent [and to the Parent for execution by the Parent](6).
5. Upon such execution and acceptance by the Agent [and execution by
the Parent]**, 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 Assignment and Acceptance, have the rights and
obligations of a Bank thereunder and (ii) the Assignor shall, to the extent its
rights and obligations have been transferred to the Assignee by this Assignment
and Acceptance, relinquish its rights (other than under Section 8.03 and Section
9.03 of the Credit Agreement) and be released from its obligations under the
Credit Agreement.
6. Upon such execution and acceptance by the Agent [and execution by
the Parent]**, from and after the Effective Date, the Agent shall make all
payments in respect of the interest assigned hereby to the Assignee. The
Assignor and Assignee shall make all appropriate adjustments in payments for
periods prior to such acceptance by the Agent directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Georgia.
[NAME OF ASSIGNOR]
By:____________________________________
Title:
[NAME OF ASSIGNEE]
By:____________________________________
Title:
Lending Office:
[Address]
WACHOVIA BANK, N.A., as Administrative Agent
By:____________________________________
Title:
- -----------------------------
(6) If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date.
[THE VALSPAR CORPORATION](8)
By:____________________________________
Title:
- -----------------------------
(8) If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date.
EXHIBIT L
NOTICE OF BORROWING
___________, ___
Wachovia Bank, N.A., as Administrative Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Re: Amended and Restated Credit Agreement (as amended and modified
from time to time, the "Credit Agreement") dated as of
February 26, 1999, by and among The Valspar Corporation, the
other Borrowers referred to therein, the Banks from time to
time parties thereto, Chase Securities Inc., as Syndication
Agent, and Wachovia Bank, N.A., as Administrative Agent and
Documentation Agent.
Gentlemen:
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings attributable thereto in the Credit Agreement.
This Notice of Borrowing is delivered to you pursuant to Section 2.02
of the Credit Agreement.
The Borrower hereby requests a [Euro-Dollar Borrowing] [Base Rate
Borrowing] [Foreign Currency Borrowing] in the aggregate principal amount of
[the Dollar Equivalent of] $___________ to be made [in the following Foreign
Currency: ________________] on ________, 19__, and for interest to accrue
thereon at the rate established by the Credit Agreement for [Euro-Dollar Loans]
[Foreign Currency Loans] [Base Rate Loans]. The duration of the Interest Period
with respect thereto shall be [1 month] [2 months] [3 months] [6 months] [30
days].
The Borrower has caused this Notice of Borrowing to be executed and
delivered by its duly authorized officer this ___ day of _________, ___.
[Insert Name of Borrower]
By:
-------------------------
Title:
EXHIBIT M
Guaranty Agreement
GUARANTY AGREEMENT (this "Agreement" or this "Guaranty") dated as of
February 26, 1999, among each Subsidiary listed on the signature pages hereto
(each such Subsidiary individually, a "Guarantor" and, if more than one such
Subsidiary is party to this Agreement, collectively, the "Guarantors") of THE
VALSPAR CORPORATION, a Delaware corporation (the "Parent"), and WACHOVIA BANK,
N.A., as agent (the "Agent") for itself and the Banks (as such term is defined
in the Credit Agreement referred to below) and their successors and assigns.
Reference is made to the Amended and Restated Credit Agreement dated as
of February 26, 1999 (as amended, supplemented or otherwise modified from time
to time, the "Credit Agreement"), among the Parent, the other Borrowers referred
to therein, the Banks from time to time party thereto (the "Banks"), Chase
Securities Inc., as Syndication Agent, and Wachovia Bank, N.A., as
Administrative Agent and Documentation Agent and Bank. Capitalized terms used
herein and not defined herein shall have the meanings assigned to such terms in
the Credit Agreement.
The Banks have agreed to make Loans to the Borrowers pursuant to, and
upon the terms and subject to the conditions specified in, the Credit Agreement.
Each of the Guarantors is a Wholly Owned Subsidiary of the Parent and
acknowledges that it will derive substantial benefit from the making of the
Loans by the Banks. The obligations of the Banks to make Loans are conditioned
on, among other things, the execution and delivery by the Guarantors of a
Guaranty Agreement in the form hereof. As consideration therefor and in order to
induce the Banks to make Loans, the Guarantors are willing to execute this
Agreement.
Accordingly, the parties hereto agree as follows:
SECTION 8. Guarantee. Each Guarantor unconditionally guarantees,
jointly with the other Guarantors and severally, as a primary obligor and not
merely as a surety, (a) the due and punctual payment of (i) the principal of and
premium, if any, and interest (including interest accruing during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) on the Loans,
when and as due, whether at maturity, by acceleration, upon one or more dates
set for prepayment or otherwise and (ii) all other monetary obligations,
including fees, costs, expenses and indemnities, whether primary, secondary,
direct, contingent, fixed or otherwise (including monetary obligations incurred
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding), of
the Borrowers to the Agent or any Bank under the Credit Agreement and the other
Loan Documents and (b) the due and punctual performance of all covenants,
agreements, obligations and liabilities
of the Borrowers under or pursuant to the Credit Agreement and the other Loan
Documents (all the monetary and other obligations referred to in the preceding
clauses (a) and (b) being collectively called the "Obligations"). Each Guarantor
further agrees that the Obligations may be extended or renewed, in whole or in
part, without notice to or further assent from it, and that it will remain bound
upon its guarantee notwithstanding any extension or renewal of any Obligation.
Anything contained in this Agreement to the contrary notwithstanding,
the obligations of each Guarantor hereunder shall be limited to a maximum
aggregate amount equal to the greatest amount that would not render such
Guarantor's obligations hereunder subject to avoidance as a fraudulent transfer
or conveyance under Section 548 of Title 11 of the United States Code or any
provisions of applicable state law (collectively, the "Fraudulent Transfer
Laws"), in each case after giving effect to all other liabilities of such
Guarantor, contingent or otherwise, that are relevant under the Fraudulent
Transfer Laws (specifically excluding, however, any liabilities of such
Guarantor (a) in respect of intercompany indebtedness to any Borrower or
Affiliates of any Borrower to the extent that such indebtedness would be
discharged in an amount equal to the amount paid by such Guarantor hereunder and
(b) under any Guarantee of senior unsecured indebtedness or Debt subordinated in
right of payment to the Obligations which Guarantee contains a limitation as to
maximum amount similar to that set forth in this paragraph, pursuant to which
the liability of such Guarantor hereunder is included in the liabilities taken
into account in determining such maximum amount) and after giving effect as
assets to the value (as determined under the applicable provisions of the
Fraudulent Transfer Laws) of any rights to subrogation, contribution,
reimbursement, indemnity or similar rights of such Guarantor pursuant to (i)
applicable law or (ii) any agreement providing for an equitable allocation among
such Guarantor and other Affiliates of any Borrower of obligations arising under
Guarantees by such parties (including the Indemnity, Subrogation and
Contribution Agreement).
SECTION 9. Obligations Not Waived. To the fullest extent permitted by
applicable law, each Guarantor waives presentment to, demand of payment from and
protest to any Borrower of any of the Obligations, and also waives notice of
acceptance of its this Guaranty and notice of protest for nonpayment. To the
fullest extent permitted by applicable law, the obligations of each Guarantor
hereunder shall not be affected by (a) the failure of the Agent or any Bank to
assert any claim or demand or to enforce or exercise any right or remedy against
any Borrower or any other Guarantor under the provisions of the Credit
Agreement, any other Loan Document or otherwise, (b) any rescission, waiver,
amendment or modification of, or any release from any of the terms or provisions
of this Agreement, any other Loan Document, any Guarantee or any other
agreement, including with respect to any other Guarantor under this Agreement or
(c) the failure to perfect any security interest in, or the release of, any of
the security held by or on behalf of the Agent or any Bank.
SECTION 10. Security. Each of the Guarantors authorizes the Agent and
each of the Banks to (a) take and hold security for the payment of this Guaranty
and the Obligations and exchange, enforce, waive and release any such security,
(b) apply such security and direct the
order or manner of sale thereof as they in their sole discretion may determine
and (c) release or substitute any one or more endorsees, other guarantors or
other obligors.
SECTION 11. Guarantee of Payment. Each Guarantor further agrees that
this Guaranty constitutes a guarantee of payment when due and not of collection,
and waives any right to require that any resort be had by the Agent or any Bank
to any of the security held for payment of the Obligations or to any balance of
any deposit account or credit on the books of the Agent or any Bank in favor of
any Borrower or any other Person.
SECTION 12. No Discharge or Diminishment of Guarantee. The obligations
of each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Obligations), including any claim of waiver, release,
surrender, alteration or compromise of any of the Obligations, and shall not be
subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or
otherwise affected by the failure of the Agent or any Bank to assert any claim
or demand or to enforce any remedy under the Credit Agreement, any other Loan
Document or any other agreement, by any waiver or modification of any provision
of any thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or omission that may or
might in any manner or to any extent vary the risk of any Guarantor or that
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the
Obligations).
SECTION 13. Defenses of Parent Waived. To the fullest extent permitted
by applicable law, each of the Guarantors waives any defense based on or arising
out of any defense of any Borrower or the unenforceability of the Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of any Borrower, other than the final and indefeasible payment in full
in cash of the Obligations. The Agent and the Banks may, at their election,
foreclose on any security held by one or more of them by one or more judicial or
nonjudicial sales, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with any Borrower or any other Guarantor or exercise any other
right or remedy available to them against any Borrower or any other Guarantor,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent the Obligations have been fully, finally and
indefeasibly paid in cash. Pursuant to applicable law, each of the Guarantors
waives any defense arising out of any such election even though such election
operates, pursuant to applicable law, to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of such Guarantor against
any Borrower or any other Guarantor, as the case may be, or any security.
SECTION 14. Agreement To Pay; Subordination. In furtherance of the
foregoing and not in limitation of any other right that the Agent or any Bank
has at law or in equity against any
Guarantor by virtue hereof, upon the failure of any Borrower to pay any
Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each Guarantor hereby
promises to and will forthwith pay, or cause to be paid, to the Agent or such
Bank as designated thereby in cash the amount of such unpaid Obligations. Upon
payment by any Guarantor of any sums to the Agent or any Bank as provided above,
all rights of such Guarantor against any Borrower arising as a result thereof by
way of right of subrogation, contribution, reimbursement, indemnity or otherwise
shall in all respects be subordinate and junior in right of payment to the prior
indefeasible payment in full in cash of all the Obligations. In addition, any
indebtedness of any Borrower or any Guarantor now or hereafter held by any
Guarantor is hereby subordinated in right of payment to the prior payment in
full of the Obligations. If any amount shall erroneously be paid to any
Guarantor on account of (i) such subrogation, contribution, reimbursement,
indemnity or similar right or (ii) any such indebtedness of any Borrower or any
other Guarantor, such amount shall be held in trust for the benefit of the Agent
and the Banks and shall forthwith be paid to the Agent to be credited against
the payment of the Obligations, whether matured or unmatured, in accordance with
the terms of the Loan Documents.
SECTION 15. Information. Each of the Guarantors assumes all
responsibility for being and keeping itself informed of the Borrowers' financial
condition and assets, and of all other circumstances bearing upon the risk of
nonpayment of the Obligations and the nature, scope and extent of the risks that
such Guarantor assumes and incurs hereunder, and agrees that none of the Agent
or the Banks will have any duty to advise any of the Guarantors of information
known to it or any of them regarding such circumstances or risks.
SECTION 16. Representations and Warranties. Each of the Guarantors
represents and warrants as to itself that all representations and warranties
relating to it contained in the Credit Agreement are true and correct.
SECTION 17. Termination. This Guaranty (a) shall terminate when all the
Obligations have been indefeasibly paid in full and the Banks have no further
commitment to lend under the Credit Agreement and (b) shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
the Agent or any Bank or any Guarantor upon the bankruptcy or reorganization of
any Borrower, any Guarantor or otherwise.
SECTION 18. Binding Effect; Several Agreement; Assignments. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Guarantors that are contained in
this Agreement shall bind and inure to the benefit of each party hereto and
their respective successors and assigns. This Agreement shall become effective
as to any Guarantor when a counterpart hereof executed on behalf of such
Guarantor shall have been delivered to the Agent, and a counterpart hereof shall
have been executed on behalf of the Agent, and thereafter shall be binding upon
such Guarantor and the Agent and their respective
successors and assigns, and shall inure to the benefit of such Guarantor, the
Agent and the Banks, and their respective successors and assigns, except that no
Guarantor shall have the right to assign its rights or obligations hereunder or
any interest herein (and any such attempted assignment shall be void). This
Agreement shall be construed as a separate agreement with respect to each
Guarantor and may be amended, modified, supplemented, waived or released with
respect to any Guarantor without the approval of any other Guarantor and without
affecting the obligations of any other Guarantor hereunder.
SECTION 19. Waivers; Amendment.
a. No failure or delay of the Agent in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any
other or further exercise thereof or the exercise of any other right or
power. The rights and remedies of the Agent hereunder and of the Banks
under the other Loan Documents are cumulative and are not exclusive of
any rights or remedies that they would otherwise have. No waiver of any
provision of this Agreement or consent to any departure by any
Guarantor therefrom shall in any event be effective unless the same
shall be permitted by paragraph (b) below, and then such waiver or
consent shall be effective only in the specific instance and for the
purpose for which given. No notice or demand on any Guarantor in any
case shall entitle such Guarantor to any other or further notice or
demand in similar or other circumstances.
b. Neither this Agreement nor any provision hereof may be
waived, amended or modified except pursuant to a written agreement
entered into between the Guarantors with respect to which such waiver,
amendment or modification relates and the Agent, with the prior written
consent of the Required Banks (except as otherwise provided in the
Credit Agreement).
SECTION 20. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
SECTION 21. Notices. All communications and notices hereunder shall be
in writing and given as provided in Section 9.01 of the Credit Agreement. All
communications and notices hereunder to each Guarantor shall be given to it in
care of the Parent at the address set forth in Section 9.01 of the Credit
Agreement.
SECTION 22. Survival of Agreement, Severability.
a. All covenants, agreements, representations and warranties
made by the Guarantors herein and in the certificates or other
instruments prepared or delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be
considered to have been relied upon by the Agent and the Banks and
shall survive the making by the Banks of the Loans regardless of any
investigation made by the Agent or any Bank or on their behalf, and
shall continue in full force and effect as long as the principal of or
any accrued interest on any Loan or any other fee or amount payable
under this Agreement or any other Loan Document is outstanding and
unpaid and as long as the Commitments have not been terminated.
b. In the event any one or more of the provisions contained in
this Agreement or in any other Loan Document should be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being
understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity
of such provision in any other jurisdiction). The parties shall
endeavor in good faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 23. Counterparts. This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute a single contract, and shall become effective as
provided in Section 11. Delivery of an executed signature page to this Agreement
by facsimile transmission shall be as effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 24. Rules of Interpretation. The rules of interpretation
specified in Sections 1.04 and 1.05 of the Credit Agreement shall be applicable
to this Agreement.
SECTION 25. Jurisdiction; Consent to Service of Process.
a. Each Guarantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction
of any Georgia State court or Federal court of the United States of
America sitting in Atlanta, Georgia, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of
any such action or proceeding may be heard and determined in such
Georgia State or, to the extent permitted by law, in such Federal
court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right that
the Agent or any Bank may otherwise have to bring any action or
proceeding relating to this Agreement or the other Loan Documents
against any Guarantor or its properties in the courts of any
jurisdiction.
b. Each Guarantor hereby irrevocably and unconditionally
waives, to the
fullest extent it may legally and effectively do so, any objection that
it may now or hereafter have to the laying of venue of any suit, action
or proceeding arising out of or relating to this Agreement or the other
Loan Documents in any Georgia State or Federal court. Each of the
parties hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
c. Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 14.
Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
SECTION 26. Right of Setoff. If an Event of Default shall have occurred
and be continuing, each Bank is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other Debt at any time owing by such Bank to or for the credit or the
account of any Guarantor against any or all the obligations of such Guarantor
now or hereafter existing under this Agreement and the other Loan Documents held
by such Bank, irrespective of whether or not such Bank shall have made any
demand under this Agreement or any other Loan Document and although such
obligations may be unmatured. The rights of each Bank under this Section 19 are
in addition to other rights and remedies (including other rights of setoff)
which such Bank may have.
SECTION 27. Additional Guarantors. Pursuant to Section 5.22 of the
Credit Agreement, certain Subsidiaries acquired or organized after the Closing
Date are required to enter into this Agreement as a Guarantor upon becoming a
Subsidiary. Upon execution and delivery, after the date hereof, by the Agent and
such a Subsidiary of an instrument in form and substance satisfactory to the
Agent, such Subsidiary shall become a Guarantor hereunder with the same force
and effect as if originally named as a Guarantor herein. The execution and
delivery of any instrument adding an additional Guarantor as a party to this
Agreement shall not require the consent of any other Guarantor hereunder. The
rights and obligations of each Guarantor hereunder shall remain in full force
and effect notwithstanding the addition of any new Guarantor as a party to this
Agreement.
SECTION 28. Failure to Pay in Foreign Currency. If any Guarantor is
unable for any reason to effect payment in a Foreign Currency as required by the
Credit Agreement or if any Guarantor shall default in a Foreign Currency, the
Agent may require such payment to be made in Dollars in the Dollar Equivalent
amount of such payment. Upon receipt by any Guarantor of notice of such election
from the Agent, the obligations of such Guarantor specified in such notice shall
immediately be deemed to be obligations due and owing in Dollars, and shall
accrue interest at the Default Rate. In any case in which any Guarantor shall
make such payment in Dollars, such Guarantor agrees to hold the Agent and each
Bank harmless from any loss incurred by the Agent or such Bank arising from any
change in value of Dollars in relation to such Foreign Currency between the date
such payment became due and the date of payment thereof.
SECTION 29. Foreign Exchange Indemnity. If any sum due from any
Guarantor under this Agreement, or any order or judgment given or made in
relation hereto has to be converted from the currency (the "first currency") in
which the same is payable hereunder or under such order or judgment into another
currency (the "second currency") for the purpose of (a) making or filing a claim
or proof against such Guarantor with any Authority or in any court or tribunal
or (b) enforcing any order or judgment given or made in relation hereto. The
Guarantors, jointly and severally, shall indemnify and hold harmless each of the
Persons to whom such sum is due from and against any loss actually suffered as a
result of any discrepancy between (i) the rate of exchange used to convert the
amount in question from the first currency into the second currency, and (ii)
the rate or rates of exchange at which such Person, acting in good faith,
purchased the first currency with the second currency after receipt of a sum
paid to it in the second currency in satisfaction, in whole or in part, of any
such order, judgment, claim or proof. The foregoing indemnity shall constitute a
separate obligation of the Guarantors distinct from their other obligations
hereunder and shall survive the giving or making of any judgment or order in
relation to all or any of such other obligations.
[The remainder of this page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
VALSPAR COATINGS FINANCE CORPORATION
By: ___________________________(SEAL)
Title:
VALSPAR FINANCE CORPORATION
By: ___________________________(SEAL)
Title:
WACHOVIA BANK, N.A., as Administrative Agent
By: ___________________________(SEAL)
Title:
EXHIBIT N
Indemnity, Subrogation and Contribution Agreement
INDEMNITY, SUBROGATION and CONTRIBUTION AGREEMENT (this "Agreement")
dated as of February 26, 1999, among THE VALSPAR CORPORATION, a Delaware
corporation (the "Parent"), certain other Subsidiaries of the Parent who are
Borrowers under the Credit Agreement referred to below (collectively, with the
Parent, the "Borrowers"), each Subsidiary of the Parent listed on the signature
pages hereto under the heading "Guarantors" (the "Guarantors") and WACHOVIA
BANK, N.A., as agent (in such capacity, the "Agent") for itself and the Banks
(as such term is defined in the Credit Agreement referred to below) and their
successors and assigns.
Reference is made to (a) the Amended and Restated Credit Agreement
dated as of February 26, 1999 (as amended, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among the Borrowers, the Banks from
time to time party thereto, Chase Securities Inc., as Syndication Agent, and
Wachovia Bank, N.A., as Administrative Agent and Documentation Agent and Bank
and (b) the Guaranty Agreement dated as of February 26, 1999, among the
Guarantors and the Agent (the "Guaranty"). Capitalized terms used herein and not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.
The Banks have agreed to make Loans to the Borrowers pursuant to, and
upon the terms and subject to the conditions specified in, the Credit Agreement.
The Guarantors have guaranteed such Loans and the other Obligations (as defined
in the Guaranty) of the Borrowers under the Credit Agreement pursuant to the
Guaranty. The obligations of the Banks to make Loans are conditioned on, among
other things, the execution and delivery by the Borrowers and the Guarantors of
an agreement in the form hereof.
Accordingly, the Borrowers, each Guarantor and the Agent agree as
follows:
SECTION 30. Indemnity and Subrogation. In addition to all such rights
of indemnity and subrogation as the Guarantors may have under applicable law
(but subject to Section 3), each Borrower agrees that (a) in the event a payment
shall be made by any Guarantor under the Guaranty, such Borrower shall indemnify
such Guarantor for the full amount of such payment and such Guarantor shall be
subrogated to the rights of the person to whom such payment shall have been made
to the extent of such payment and (b) in the event any assets of any Guarantor
shall be sold pursuant to any Loan Document to satisfy a claim of the Agent or
any Bank, such Borrower shall indemnify such Guarantor in an amount equal to the
greater of the book value or the fair market value of the assets so sold.
SECTION 31. Contribution and Subrogation. Each Guarantor (a
"Contributing Guarantor") agrees (subject to Section 3) that, in the event a
payment shall be made by any other Guarantor under the Guaranty or assets of any
other Guarantor shall be sold pursuant to any Loan
Document to satisfy a claim of the Agent or any Bank and such other Guarantor
(the "Claiming Guarantor") shall not have been fully indemnified by the
Borrowers as provided in Section 1, the Contributing Guarantor shall indemnify
the Claiming Guarantor in an amount equal to the amount of such payment or the
greater of the book value or the fair market value of such assets, as the case
may be, in each case multiplied by a fraction of which the numerator shall be
the net worth of the Contributing Guarantor on the date hereof and the
denominator shall be the aggregate net worth of all the Guarantors on the date
hereof. Any Contributing Guarantor making any payment to a Claiming Guarantor
pursuant to this Section 2 shall be subrogated to the rights of such Claiming
Guarantor under Section 1 to the extent of such payment.
SECTION 32. Subordination. Notwithstanding any provision of this
Agreement to the contrary, all rights of the Guarantors under Sections 1 and 2
and all other rights of indemnity, contribution or subrogation under applicable
law or otherwise shall be fully subordinated to the indefeasible payment in full
in cash of the Obligations. No failure on the part of any Borrower or any
Guarantor to make the payments required by Sections 1 and 2 (or any other
payments required under applicable law or otherwise) shall in any respect limit
the obligations and liabilities of any Guarantor with respect to its obligations
hereunder, and each Guarantor shall remain liable for the full amount of the
obligations of such Guarantor hereunder.
SECTION 33. Termination. This Agreement shall survive and be in full
force and effect so long as any Obligation is outstanding and has not been
indefeasibly paid in full in cash, and so long as any of the Commitments under
the Credit Agreement have not been terminated, and shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
the Agent or any Bank or any Guarantor upon the bankruptcy or reorganization of
any Borrower, any Guarantor or otherwise.
SECTION 34. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
SECTION 35. No Waiver; Amendment.
a. No failure on the part of the Agent or any Guarantor to
exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy by the Agent or any
Guarantor preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. All remedies hereunder
are cumulative and are not exclusive of any other remedies provided by
law. None of the Agent and the Guarantors shall be deemed to have
waived any rights hereunder unless such waiver shall be in writing and
signed by such parties.
b. Neither this Agreement nor any provision hereof may be
waived, amended
or modified except pursuant to a written agreement entered into between
the Borrowers, the Guarantors and the Agent, with the prior written
consent of the Required Banks (except as otherwise provided in the
Credit Agreement).
SECTION 36. Notices. All communications and notices hereunder shall be
in writing and given as provided in the Guaranty and addressed as specified
therein.
SECTION 37. Binding Agreement; Assignments. Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the parties that are contained in this
Agreement shall bind and inure to the benefit of their respective successors and
assigns. Neither any Borrower nor any Guarantor may assign or transfer any of
its rights or obligations hereunder (and any such attempted assignment or
transfer shall be void) without the prior written consent of the Required Banks.
SECTION 38. Survival of Agreement, Severability.
a. All covenants and agreements made by each Borrower and each
Guarantor herein and in the certificates or other instruments prepared
or delivered in connection with this Agreement or the other Loan
Documents shall be considered to have been relied upon by the Agent,
each Bank and each Guarantor and shall survive the making by the Banks
of the Loans, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loans or any other fee
or amount payable under the Credit Agreement or this Agreement or under
any of the other Loan Documents is outstanding and unpaid and as long
as the Commitments have not been terminated.
b. In case any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any
respect, no party hereto shall be required to comply with such
provision for so long as such provision is held to be invalid, illegal
or unenforceable, but the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected
or impaired thereby. The parties shall endeavor in good faith
negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as
close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 39. Counterparts. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement shall be effective with
respect to any Guarantor when a counterpart bearing the signature of such
Guarantor shall have been delivered to the Agent. Delivery of an executed
signature page to this Agreement by facsimile transmission shall be as effective
as delivery of a manually signed counterpart of this Agreement.
SECTION 40. Rules of Interpretation. The rules of interpretation
specified in Sections 1.04 and1.05 of the Credit Agreement shall be applicable
to this Agreement.
SECTION 41. Additional Guarantors. Pursuant to Section 5.22 of the
Credit Agreement, certain Subsidiaries acquired or organized after the Closing
Date are required to become a party to this Agreement as a Guarantor upon
becoming a Subsidiary. Upon execution and delivery, after the date hereof, by
the Agent and such a Subsidiary of an instrument in form and substance
satisfactory to the Agent, such Subsidiary shall become a Guarantor hereunder
with the same force and effect as if originally named as a Guarantor herein. The
execution and delivery of any instrument adding an additional Guarantor as a
party to this Agreement shall not require the consent of any other Guarantor
hereunder. The rights and obligations of each Guarantor hereunder shall remain
in full force and effect notwithstanding the addition of any new Guarantor as a
party to this Agreement.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first appearing above.
THE VALSPAR CORPORATION
By: ___________________________(SEAL)
Title:
ENGINEERED POLYMER SOLUTIONS, INC.
By: ___________________________(SEAL)
Title:
THE VALSPAR (UK) HOLDING CORPORATION LTD.
By: ___________________________(SEAL)
Title:
THE VALSPAR (SWITZERLAND) HOLDING
CORPORATION A.G.
By: ___________________________(SEAL)
Title:
FORTON B.V.
By: ___________________________(SEAL)
Title:
DYFLEX B.V.
By: ___________________________(SEAL)
Title:
GUARANTORS:
VALSPAR COATINGS FINANCE CORPORATION
By: ___________________________(SEAL)
Title:
VALSPAR FINANCE CORPORATION
By: ___________________________(SEAL)
Title:
WACHOVIA BANK, N.A., as Administrative Agent
By: ___________________________(SEAL)
Title: