Exhibit 10(b)
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REVOLVING CREDIT LOAN, ACQUISITION / TERM LOAN
AND F/X LINE OF CREDIT LOAN AGREEMENT
executed by and among
CANTEL MEDICAL CORP. AND MEDIVATORS, INC.,
as the US Borrowers
AND
OTHER US BORROWERS HEREAFTER SIGNATORY HERETO,
each as an additional US Borrower
AND
CARSEN GROUP INC.,
as the Canadian Borrower
AND
SUMMIT BANK,
as the Administrative Agent, as the US Collateral Agent and as a Lender
AND
MELLON BANK, N.A., CANADA BRANCH,
as the Canadian Collateral Agent and as a Lender
AND
MELLON BANK, N.A.,
as a Lender
AND
OTHER LENDERS HEREAFTER SIGNATORY HERETO,
each as an additional Lender
DATED: FEBRUARY 23, 2001
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TABLE OF CONTENTS
PREAMBLE AND RECITALS 1
ARTICLE I
DEFINITIONS; RULES OF INTERPRETATION AND CONSTRUCTION;
AND ACCOUNTING PRINCIPLES
Section 1.01 Definitions 5
Section 1.02 Rules of Interpretation and Construction 46
Section 1.03 Accounting Principles 48
ARTICLE II
AMOUNTS AND TERMS OF THE LOAN FACILITIES
Section 2.01 US Revolving Credit Loan Facility 50
Section 2.02 Canadian Revolving Credit Loan Facility 59
Section 2.03 Acquisition/Term Loan Facility 70
Section 2.04 F/X Line of Credit Facility 71
Section 2.05 Interest on the Loan Facilities 74
Section 2.06 Canadian Bankers Acceptances 79
Section 2.07 Fees 84
Section 2.08 Prepayments 86
Section 2.09 Payments; Collection of Accounts 88
Section 2.10 Special Provisions Governing Eurodollar Rate Loans 90
Section 2.11 Increased Capital 94
Section 2.12 Authorized Officers of the Borrowers 95
Section 2.13 Taxes 96
Section 2.14 Security for the Loan Facilities 99
Section 2.15 Currency Fluctuations 99
Section 2.16 Joint and Several Liability 100
ARTICLE III
CONDITIONS PRECEDENT TO THE LOAN FACILITIES
Section 3.01 Conditions Precedent to the Effectiveness of this
Loan Agreement 101
Section 3.02 Conditions Precedent to All Loans and Letters of Credit 104
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Representations and Warranties on the Closing Date 106
Section 4.02 Subsequent Funding Representations and Warranties 115
ARTICLE V
REPORTING COVENANTS
Section 5.01 Statement of Accounting 116
Section 5.02 Reporting and Information Requirements 116
Section 5.03 Environmental Notices 120
Section 5.04 Notice of Name Changes and Location Changes 121
Section 5.05 Semi-Annual Collateral Audit 121
ARTICLE VI
AFFIRMATIVE COVENANTS
Section 6.01 Corporate Existence, etc. 122
Section 6.02 Corporate Powers, etc. 122
Section 6.03 Compliance with Laws, etc. 122
Section 6.04 Payment of Taxes and Claims 122
Section 6.05 Maintenance of Properties; Insurance 122
Section 6.06 Inspection of Property; Books and Records; Discussions 123
Section 6.07 Litigation, Claims, etc. 124
Section 6.08 Labor Disputes 124
Section 6.09 Maintenance of Licenses, Permits, etc. 124
Section 6.10 Use of Proceeds 124
Section 6.11 Continuation of or Change in Business 124
Section 6.12 Additional US Borrowers and Additional Corporate Guarantors 124
Section 6.13 Minimum Required Interest Rate Hedge Protection 125
Section 6.14 Bank of Account for Borrowers 125
Section 6.15 Landlord Subordination and Waiver Agreements 126
Section 6.16 Ownership of Subsidiaries 126
Section 6.17 Inactive Subsidiaries 126
ARTICLE VII
NEGATIVE COVENANTS
Section 7.01 Consolidated Debt 127
Section 7.02 Sales of Assets; Liens. 127
Section 7.03 Loans, Advances and Investments 128
Section 7.04 Restricted Junior Payments 129
Section 7.05 Restriction on Fundamental Changes 129
Section 7.06 ERISA 130
Section 7.07 Amendment of Certificate or Articles of Incorporation,
Memorandum and Articles of Association and/or By-Laws 130
Section 7.08 Margin Regulations 130
Section 7.09 Cancellation of Consolidated Debt; Prepayments 130
Section 7.10 Environmental Liabilities 131
Section 7.11 Guaranties 131
Section 7.12 No Negative Pledges to Other Person 131
Section 7.13 Operating Leases 132
Section 7.14 Sales and Leasebacks 132
Section 7.15 Fiscal Years 132
ARTICLE VIII
FINANCIAL COVENANTS
Section 8.01 Minimum Consolidated Tangible Net Worth 132
Section 8.02 Maximum Consolidated Funded Debt Leverage Ratio 133
Section 8.03 Minimum Consolidated Interest Coverage Ratio 134
Section 8.04 Minimum Consolidated Fixed Charge Coverage Ratio 134
Section 8.05 Maximum Capital Expenditures 134
ARTICLE IX
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
Section 9.01 Events of Default 134
Section 9.02 Rights and Remedies 137
Section 9.03 Application of Proceeds 138
Section 9.04 No Notices 142
Section 9.05 Agreement to Pay Attorneys' Fees and Expenses 142
Section 9.06 No Additional Waiver Implied by One Waiver 142
Section 9.07 Failure to Exercise Rights 142
Section 9.08 Waiver of Jury Trial 143
Section 9.09 Remedies Cumulative 143
ARTICLE X
THE ADMINISTRATIVE AGENT; THE US COLLATERAL AGENT AND THE
CANADIAN COLLATERAL AGENT
Section 10.01 Appointment 144
Section 10.02 General Nature of the Agents' Duties 144
Section 10.03 Exercise of Powers 145
Section 10.04 General Exculpatory Provisions 146
Section 10.05 Administration by the Agents 146
Section 10.06 Each Lender Not Relying on Agents or Any Other Lenders 147
Section 10.07 Indemnification 148
Section 10.08 Agents in their Individual Capacities 148
Section 10.09 Holders of Notes 148
Section 10.10 Successor Agents 148
Section 10.11 Additional Agents 149
Section 10.12 Calculations 149
ARTICLE XI
MISCELLANEOUS
Section 11.01 Concerning the Collateral and the Collateral Documents 150
Section 11.02 Assignments and Participations 150
Section 11.03 Expenses 153
Section 11.04 Indemnity 154
Section 11.05 Ratable Sharing 155
Section 11.06 Amendments and Waivers 156
Section 11.07 Independence of Covenants 158
Section 11.08 Notices 158
Section 11.09 Survival of Warranties and Agreements 158
Section 11.10 Marshalling; Recourse to Security; Payments Set Aside 158
Section 11.11 Severability 158
Section 11.12 Governing Law 159
Section 11.13 Successors and Assigns 159
Section 11.14 Consent to Jurisdiction and Service of Process 159
Section 11.15 Counterparts; Effectiveness; Inconsistencies 160
Section 11.16 Construction 160
Section 11.17 Entire Agreement / Integration Clause 160
Section 11.18 Process Agent 160
Section 11.19 Judgment Currency 160
Section 11.20 Credit Support Document 161
Section 11.21 Interest Savings Clause 161
Section 11.22 Replacement of Lost Promissory Notes or Collateral Documents 161
Section 11.23 Yearly Rate Statements 161
EXHIBITS AND SCHEDULES
EXHIBITS
Exhibit "A" Form of Acquisition/Term Loan Note
Exhibit "B" Form of Assignment and Acceptance Agreement
Exhibit "C-1" Form of US Borrowing Base Certificate
Exhibit "C-2" Form of Canadian Borrowing Base Certificate
Exhibit "D" Form of Canadian Revolving Credit Loan Note
Exhibit "E-1 Form of Landlord Subordination and Waiver Agreement - US
Locations
Exhibit "E-2 Form of Landlord Subordination and Waiver Agreement - Canadian
Locations
Exhibit "F" Form of Letters of Credit Reimbursement Agreement
Exhibit "G-1" Form of US Notice of Borrowing
Exhibit "G-2" Form of Canadian Notice of Borrowing and Form of Canadian
Bankers Acceptance Notice
Exhibit "H" Form of Notice of Conversion/Continuation
Exhibit "I" Form of Officer's Certificate
Exhibit "J" Form of Master Agreement
Exhibit "K" Form of US Revolving Credit Loan Note
Exhibit "L" Form of Foreign Exchange Confirmation
Exhibit "M" Form of Non-Bank Compliance Certificate
Exhibit "N" Form of Opinion Letters
SCHEDULES
Schedule 1.01-A List of Leased Properties
Schedule 1.01-B Customary Permitted Liens
Schedule 1.01-C Eurodollar Affiliates
Schedule 1.01-D Permitted Encumbrances
Schedule 2.07 (ii) Letter of Credit Fees
Schedule 4.01 (iii) Ownership of Capital Stock
Schedule 4.01 (vii) Pending or Threatened Litigation
Schedule 4.01 (xv) Environmental Matters
Schedule 4.01 (xvi) ERISA
Schedule 4.01 (xx) Joint Venture/Partnership
Schedule 4.01 (xxi) Insurance Policies, Programs and Claims
Schedule 4.01 (xxv) List of Undisclosed Liabilities
Schedule 4.01 (xxvii) Labor Matters
Schedule 4.01 (xxx) Business Names
Schedule 4.01 (xxxi) Location of Collateral
Schedule 6.05 Schedule of Insurance Policies and Programs
Schedule 7.01(iii) Permitted Existing Debt
Schedule 7.03 Existing Loans, Advances, Investments
Schedule 7.11(i) Existing Guaranties
REVOLVING CREDIT LOAN, ACQUISITION/TERM LOAN AND
F/X LINE OF CREDIT LOAN AGREEMENT
THIS REVOLVING CREDIT LOAN, ACQUISITION/TERM LOAN AND F/X LINE OF CREDIT
LOAN AGREEMENT (hereinafter, as it may be from time to time amended, modified,
extended, refinanced, renewed and/or supplemented, referred to as this "Loan
Agreement"), is made this 23rd day of February, 2001, by and among
CANTEL MEDICAL CORP., a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware, having its principal
office located at 150 Clove Road, 9th Floor, Overlook at Great Notch, Little
Falls, New Jersey 07424 (hereinafter sometimes referred to as "Cantel Medical"
and sometimes referred to as a "US Borrower"),
AND
CARSEN GROUP INC., a company duly organized, validly existing and in good
standing under the laws of the Province of Ontario, Canada, having its principal
office and chief executive office located at 151 Telson Road, Markham, Ontario
L3R 1E7 (hereinafter sometimes referred to as "Carsen Group" and sometimes
referred to as the "Canadian Borrower"),
AND
MEDIVATORS, INC., a corporation duly organized, validly existing and in
good standing under the laws of the State of Minnesota, having its principal
office located at 2995 Lone Oak Circle, Suite 10, Eagan, Minnesota 55121
(hereinafter sometimes referred to as "MediVators" and sometimes referred to as
a "US Borrower"),
AND
OTHER DOMESTIC SUBSIDIARIES OF CANTEL MEDICAL, who from time to time may
hereafter become a "US Borrower" pursuant to the terms, conditions and
provisions of SECTION 6.12 of this Loan Agreement (hereinafter, together with
Cantel Medical and MediVators, collectively referred to as the "US Borrowers"
and individually referred to as a "US Borrower"),
AND
SUMMIT BANK, a state banking corporation duly organized and validly
existing under the laws of the State of New Jersey, having an office located at
250 Moore Street, Hackensack, New Jersey 07602, in its capacity as a lender
hereunder (hereinafter sometimes referred to individually as "Summit Bank"
and/or as a "US Lender"),
AND
MELLON BANK, N.A., CANADA BRANCH, a Schedule III bank under the BANK ACT
(Canada), duly authorized by the Minister of Finance to operate as an authorized
foreign bank
and to carry on business in Canada, having an office located at Royal Trust
Tower, 32nd Floor, Toronto Dominion Center, Toronto, Ontario M5K 1K2, in its
capacity as a lender hereunder (hereinafter sometimes referred to as "Mellon
Canada" and/or as a "Canadian Lender"),
AND
MELLON BANK, N.A., a national banking association duly organized and
validly existing under the laws of the United States of America, having an
office located at Mellon Bank Center, 1735 Market Street, Philadelphia,
Pennsylvania 19101, in its capacity as a lender hereunder (hereinafter sometimes
referred to as "Mellon US" and/or as a "US Lender"),
AND
OTHER FINANCIAL INSTITUTIONS, that are either signatories to this Loan
Agreement or who from time to time may hereafter become a lender under this Loan
Agreement pursuant to SECTION 11.02 hereof (hereinafter, together with Summit
Bank, Mellon Canada and Mellon US, collectively referred to as the "Lenders" and
individually referred to as a "Lender"),
AND
SUMMIT BANK, a state banking corporation duly organized and validly
existing under the laws of the State of New Jersey, having an office located at
250 Moore Street, Hackensack, New Jersey 07602, in its capacity as the agent
with respect to collateral hereunder located in the United States of America
(hereinafter referred to as the "US Collateral Agent"),
AND
MELLON BANK, N.A., CANADA BRANCH, a Schedule III bank under the BANK ACT
(Canada), duly authorized by the Minister of Finance to operate as an authorized
foreign bank and to carry on business in Canada, duly organized and validly
existing under the laws of Canada, having an office located at Royal Trust
Tower, 32nd Floor, Toronto Dominion Center, Toronto, Ontario M5K 1K2, in its
capacity as the agent with respect to collateral hereunder located in Canada
(hereinafter referred to as the "Canadian Collateral Agent"),
AND
SUMMIT BANK, a state banking corporation duly organized and validly
existing under the laws of the State of New Jersey, having an office located at
250 Moore Street, Hackensack, New Jersey 07602, in its capacity as the
administrative agent hereunder (hereinafter referred to as the "Administrative
Agent"),
W I T N E S S E T H :
WHEREAS, the US Borrowers are engaged in the business of manufacturing and
servicing infection prevention and control products in the United States which
are distributed worldwide, and the Canadian Borrower is engaged in the business
of marketing, distributing and servicing medical and scientific products in
Canada; and
WHEREAS, defined terms used but not expressly defined in these recitals
shall have the same meanings when used in these recitals as set forth in SECTION
1.01 below; and
WHEREAS, the US Borrowers and the Canadian Borrower have requested that
(i) Summit Bank and the other "US Lenders" (as such term is defined in SECTION
1.01 below) holding a US Revolving Credit Commitment, make available to the US
Borrowers, ON A JOINT AND SEVERAL BASIS, a secured recourse revolving credit
loan in the aggregate principal amount of up to Two Million Five Hundred
Thousand and 00/100 (US$2,500,000.00) Dollars (hereinafter, as it may be from
time to time amended, modified, extended, renewed, refinanced and/or
supplemented, referred to as the "US Revolving Credit Loan Facility") for the
purposes of financing (a) a portion of the US Borrowers' working capital
requirements with a sublimit of up to Five Hundred Thousand and 00/100
(US$500,000.00) Dollars to provide for the issuance of documentary and standby
letters of credit and (b) a portion of the US Borrowers' requirements for
"Capital Expenditures" (as such term is defined in SECTION 1.01 below), (ii)
Mellon Canada and the other "Canadian Lenders" (as such term is defined in
SECTION 1.01 below) holding a Canadian Revolving Credit Commitment, make
available to the Canadian Borrower, ON A SEVERAL BASIS (AND NOT ON A JOINT OR
JOINT AND SEVERAL BASIS) WITH ANY OTHER BORROWER, a secured recourse revolving
credit loan in the aggregate principal amount of up to Five Million and 00/100
(US$5,000,000.00) Dollars, or the Canadian Dollar Equivalent thereof
(hereinafter, as it may be from time to time amended, modified, extended,
renewed, refinanced and/or supplemented, referred to as the "Canadian Revolving
Credit Loan Facility") for the purposes of financing (a) a portion of the
Canadian Borrower's working capital requirements with a sublimit of up to One
Million and 00/100 (US$1,000,000.00) Dollars to provide for the issuance of
documentary and standby letters of credit and (b) a portion of the Canadian
Borrower's requirements for Capital Expenditures; (iii) Summit Bank, Mellon US
and the other US Lenders holding an Acquisition/Term Loan Commitment, make
available to the US Borrowers, ON A JOINT AND SEVERAL BASIS, a secured recourse
acquisition/term loan facility in the aggregate principal amount of up to Twelve
Million Five Hundred Thousand and 00/100 (US$12,500,000.00) Dollars
(hereinafter, as it may be from time to time amended, modified, extended,
renewed, refinanced and/or supplemented, referred to as the "Acquisition/Term
Loan Facility") for the purposes of financing a portion of certain "Permitted
Acquisitions" (as such term is defined in SECTION 1.01 below); and (iv) Summit
Bank and Mellon US make available to the Canadian Borrower a secured recourse
line of credit facility in connection with the Canadian Borrower's purchase of
"Foreign Exchange Contracts" (as such term is defined in SECTION 1.01 below) in
an aggregate amount, based upon the face amount of such Foreign Exchange
Contracts, of up to Fifteen Million and 00/100 (US$15,000,000.00) Dollars
(hereinafter, as it may be from time to time amended, modified,
extended, renewed, refinanced and/or supplemented, referred to as the "F/X Line
of Credit Facility"); and
WHEREAS, for the purposes of this Loan Agreement, the US Revolving Credit
Loan Facility, the Canadian Revolving Credit Loan Facility, the Acquisition/Term
Loan Facility and the F/X Line of Credit Facility shall be collectively referred
to as the "Loan Facilities"; and
WHEREAS, the Lenders have agreed to make their applicable Loan Facilities
available to the applicable US Borrowers and the Canadian Borrower, subject to
the terms, conditions and provisions hereinafter set forth; and
WHEREAS, the US Borrowers, the Canadian Borrower, the Administrative
Agent, the Canadian Collateral Agent, the US Collateral Agent and the Lenders
anticipate and contemplate that the Lenders may sell, assign and transfer at
times after the date hereof, a portion of their respective interests in the Loan
Facilities (EXCEPT for the F/X Line of Credit Facility) to other financial
institutions described in the definition of "Eligible Assignee" set forth in
SECTION 1.01 of this Loan Agreement, and any such additional lenders shall
hereinafter be included as "Lenders" under this Loan Agreement; and
WHEREAS, the Lenders have requested and agreed that (i) the Administrative
Agent act as administrative agent for the Lenders in connection with the Loan
Facilities, (ii) the US Collateral Agent act as collateral agent for the Lenders
in connection with any and all Collateral located in the United States of
America and (iii) the Canadian Collateral Agent act as the administrative and
collateral agent with respect to the administration and funding of Canadian
Bankers Acceptances, Canadian Revolving Credit Loans and Canadian Letters of
Credit, the establishment of the Base Rate for relevant Canadian Revolving
Credit Loans, the acceptance and distribution of payments made in respect of
Canadian Revolving Credit Loans, Canadian Letter of Credit Obligations and
Canadian Bankers Acceptances and the administration of the Canadian Lenders'
rights and/or remedies with respect to any Collateral located in Canada
(including, without limitation, Collateral held under the BANK ACT (Canada)),
and the Administrative Agent, the US Collateral Agent and the Canadian
Collateral Agent, respectively, have agreed to accept such responsibilities and
duties, subject to the terms, conditions and provisions hereinafter set forth.
NOW, THEREFORE, in consideration of these premises and the mutual
representations, covenants and agreements of the US Borrowers, the Canadian
Borrower, the Lenders, the Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent, each party, binding itself and its respective
successors and assigns, hereby promises, covenants and agrees as follows:
ARTICLE I
DEFINITIONS; RULES OF INTERPRETATION AND
CONSTRUCTION; AND ACCOUNTING PRINCIPLES
SECTION 1.01 DEFINITIONS. The following terms, as used in this Loan
Agreement, shall have the following meanings, unless the context clearly
indicates and requires otherwise:
"ACCEPTANCE FEE" means the fee payable at the time of the acceptance of a
Canadian Bankers Acceptance established by multiplying the face amount of such
Canadian Bankers Acceptance by the BA Margin as of the date of issue and
acceptance of such Canadian Bankers Acceptance and by multiplying the product so
obtained by a fraction having a numerator equal to the number of days in the
term of such Canadian Bankers Acceptance and a denominator of 365.
"ACCOUNTS" or "ACCOUNT RECEIVABLE" or "ACCOUNTS RECEIVABLE" shall mean (i)
any "account", as such term is defined in Section 9-106 of the Uniform
Commercial Code of each State where applicable (or any successor section of the
Uniform Commercial Code) and (ii) any "account", as such term is defined in
subsection 1(1) of the Personal Property Security Act (Ontario) (or any
successor section of the Personal Property Security Act (Ontario)), whether now
owned or hereafter acquired by any of the Borrowers and/or any of their
Subsidiaries, and in any event, includes, without limitation, all accounts,
contracts, contract rights, chattel paper, general intangibles, notes, drafts,
acceptances, chattel mortgages, conditional sale contracts, bailment leases,
security agreements, contribution rights and other forms of obligations now or
hereafter arising out of or acquired in the course of or in connection with any
business of the Borrowers and/or their Subsidiaries, together with any and all
liens, guaranties, securities, rights, remedies and privileges pertaining to any
of the foregoing, whether now existing or hereafter created or arising, and all
rights with respect to returned and repossessed items of inventory.
"ACQUIRING PERSON" shall mean any Person who or which, alone or together
with all Affiliates and Associates of such Person, shall be the Beneficial Owner
of more than thirty percent (30%) of the Common Shares then authorized, issued
and outstanding, but shall not include (i) Cantel Medical, (ii) Charles M.
Diker, an individual who owns approximately thirty percent (30%) of Cantel
Medical as of the Closing Date, or (iii) any such Person who has become such a
Beneficial Owner SOLELY because (a) of a change in the aggregate number of
Common Shares outstanding since the last date on which such Person acquired
Beneficial Ownership of any Common Shares or (b) such Person acquired such
Beneficial Ownership in the good faith belief that such acquisition would not
cause such Beneficial Ownership to exceed thirty percent (30%) of the Common
Shares then outstanding and such Person relied in good faith in computing the
percentage of its Beneficial Ownership on publicly filed reports or documents of
Cantel Medical which are inaccurate or out-of-date. Notwithstanding anything
contained in CLAUSE (III) of the prior sentence to the contrary, if any Person
that is an Acquiring Person due to such CLAUSE (III) does not reduce its
percentage of Beneficial Ownership of Common Shares to thirty percent (30%) or
less by the Close of Business on the fifth Business Day after notice from the
Administrative Agent (the date of notice being the first day) that such Person's
Beneficial Ownership of Common Shares so exceeds thirty percent (30%), then such
Person shall, at the end of such five Business Day period, become an Acquiring
Person (and such CLAUSE (III) shall no longer apply to such Person). For
purposes of this definition, the determination as to whether any Person acted in
"good faith" shall be conclusively determined by the Administrative Agent.
"ACQUISITION/TERM LOAN" and "ACQUISITION/TERM LOANS" shall have the
meaning ascribed and assigned to such term in SECTION 2.03(i)(a) of this Loan
Agreement.
"ACQUISITION/TERM LOAN COMMITMENT" shall mean, with respect to any US
Lender, as of any date of determination, such US Lender's Pro Rata Share of the
amount of the Acquisition/Term Loan Facility, if any, as of such date, which
percentage and amount shall be set forth on the signature pages to this Loan
Agreement and/or in any Assignment and Acceptance Agreement.
"ACQUISITION/TERM LOAN FACILITY" shall have the meaning assigned and
ascribed to such term as set forth in the second recital of this Loan Agreement.
"ACQUISITION/TERM LOAN MATURITY DATE" shall mean the earlier to occur of
(i) February 22, 2008 or (ii) the date of termination of the Acquisition/Term
Loan Facility pursuant to SECTION 9.02 of this Loan Agreement.
"ACQUISITION/TERM LOAN NOTES" shall mean a collective reference to any and
all acquisition/term loan notes in substantially the form attached hereto as
EXHIBIT "A" with all requisite blanks appropriately filled, each such note
payable to the order of a US Lender and in a face amount equal to such US
Lender's Pro Rata Share of the particular Acquisition/Term Loan made available
to the US Borrowers pursuant to such acquisition/term loan note, all such
acquisition/term loan notes representing Acquisition/Term Loans made available
by the US Lenders to the US Borrowers pursuant to the terms, conditions and
provisions of SECTION 2.03 of this Loan Agreement.
"ACQUISITION/TERM LOAN PERIOD" shall mean, with respect to the
Acquisition/Term Loan Facility, the period commencing on the Closing Date and
ending on the Acquisition/Term Loan Termination Date.
"ACQUISITION/TERM LOAN TERM PERIOD" shall mean the period commencing on
the Acquisition/Term Loan Termination Date and ending on the Acquisition/Term
Loan Maturity Date.
"ACQUISITION/TERM LOAN TERMINATION DATE" shall mean the earlier to occur
of (i) February 22, 2003 or (ii) the date of termination of the Acquisition/Term
Loan Facility pursuant to SECTION 9.02 of this Loan Agreement.
"ADMINISTRATIVE AGENT" shall have the meaning ascribed and assigned to
such term as set forth in the preamble of this Loan Agreement; PROVIDED,
HOWEVER, pursuant to the terms, conditions and provisions of SECTION 10.11 of
this Loan Agreement, the Administrative Agent and the Lenders hereby designate
(i) Summit Bank to act as the US Collateral Agent with respect to the
administration of the US Lenders' rights and/or remedies with respect to any US
Collateral and (ii) Mellon Canada to act as the Canadian Collateral Agent with
respect to the administration and funding of Canadian Bankers Acceptances,
Canadian Revolving Credit Loans and Canadian Letters of Credit, the
establishment of the Base Rate for relevant Canadian Revolving Credit Loans, the
acceptance and distribution of payments made in respect of Canadian Revolving
Credit Loans, Canadian Letter of Credit Obligations and Canadian Bankers
Acceptances and the administration and enforcement of the Canadian Lender's
rights and/or remedies with respect to any Canadian Collateral (including,
without limitation, Collateral held under the BANK ACT (Canada)).
"ADMINISTRATIVE AGENT'S OFFICE" shall mean the Administrative Agent's
principal office located at 750 Walnut Avenue, Cranford, New Jersey 07016, or at
such office or offices of the Administrative Agent or branch, subsidiary or
affiliate thereof, as may be designated in writing from time to time by the
Administrative Agent to the Borrowers, the other Agents and the Lenders.
"ADVANCE LIMIT" shall mean (i) with respect to the US Revolving Credit
Loan Facility, the Dollar Equivalent of the aggregate amount of the US Revolving
Credit Loan Facility which the US Lenders then holding a US Revolving Credit
Commitment may from time to time advance to the US Borrowers in the form of
either US Revolving Credit Loans and/or US Letters of Credit, and which amount
shall not in the aggregate at any time outstanding exceed the lesser of (a)
US$2,500,000.00 or (b) the sum of (1) eighty-five percent (85%) of all Qualified
US Accounts Receivable, as of any date of determination, PLUS (2) fifty (50%) of
all Qualified US Inventory, as of such date of determination, and (ii) with
respect to the Canadian Revolving Credit Loan Facility, the Dollar Equivalent of
the aggregate amount of the Canadian Revolving Credit Loan Facility which the
Canadian Lenders then holding a Canadian Revolving Credit Commitment may from
time to time advance to the Canadian Borrower in the form of either Canadian
Revolving Credit Loans, Canadian Letters of Credit and/or Canadian Bankers
Acceptances, and which amount shall not in the aggregate at any time outstanding
exceed the lesser of (a) US$5,000,000.00 or (b) the sum of (1) eighty-five
percent (85%) of all Qualified Canadian Accounts Receivable, as of any date of
determination, PLUS (2) fifty (50%) of all Qualified Canadian Inventory, as of
such date of determination.
"AFFILIATES AND ASSOCIATES" when used with reference to any Person shall
have the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act, as in effect on the
date of this Loan Agreement.
"AGENT" and/or "AGENTS" shall mean a reference to any one or more of (i)
the
Administrative Agent, (ii) the US Collateral Agent and (iii) the Canadian
Collateral Agent, as applicable in the given context.
"AGREEMENT OF GUARANTY" and "AGREEMENTS OF GUARANTY" shall mean a
reference to one or more of (i) the Agreement of Guaranty #1, (ii) the Agreement
of Guaranty #2, (iii) the Agreement of Guaranty #3, (iv) any and all additional
agreements of guaranty, in form and substance satisfactory to the Administrative
Agent, in its sole and absolute discretion, for the benefit of Summit Bank and
Mellon US, executed, made and/or entered into subsequent to the Closing Date for
the purposes of adding domestic Subsidiaries of the US Borrowers as guarantors,
ON A JOINT AND SEVERAL BASIS with all of the other Corporate Guarantors, of the
payment and performance of all of the Obligations of the Canadian Borrower in
connection with the F/X Line of Credit Facility, as provided for in and required
by SECTION 6.12 of this Loan Agreement and (v) any and all additional agreements
of guaranty, in form and substance satisfactory to the Administrative Agent, in
its sole and absolute discretion, for the benefit of the Canadian Lenders,
executed, made and/or entered into subsequent to the Closing Date for the
purposes of adding domestic Subsidiaries of the US Borrowers as guarantors, ON A
JOINT AND SEVERAL BASIS with all of the other Corporate Guarantors, of the
payment and performance of all of the Obligations of the Canadian Borrower in
connection with the Canadian Revolving Credit Loan Facility, as provided for in
and required by SECTION 6.12 of this Loan Agreement, as any of said agreements
of guaranty may be from time to time amended, modified, extended, renewed,
refinanced and/or supplemented.
"AGREEMENT OF GUARANTY #1" shall mean that certain Agreement of Guaranty
#1 dated of even date herewith, executed by Cantel Medical and MediVators in
favor of the Administrative Agent, for the benefit of Summit Bank and Mellon US,
pursuant to which Cantel Medical and MediVators have agreed to guaranty, ON A
JOINT AND SEVERAL BASIS, all of the obligations of the Canadian Borrower in
connection with the F/X Line of Credit Facility, as said Agreement of Guaranty
#1 may be from time to time amended, modified, extended, renewed, refinanced
and/or supplemented.
"AGREEMENT OF GUARANTY #2" shall mean that certain Agreement of Guaranty
#2 dated of even date herewith, executed by Cantel Medical and MediVators in
favor of the Administrative Agent, for the benefit of the Canadian Lenders,
pursuant to which Cantel Medical and MediVators have agreed to guaranty, ON A
JOINT AND SEVERAL BASIS, all of the obligations of the Canadian Borrower in
connection with the Canadian Revolving Credit Loan Facility, as said Agreement
of Guaranty #2 may be from time to time amended, modified, extended, renewed,
refinanced and/or supplemented.
"AGREEMENT OF GUARANTY #3" shall mean that certain Agreement of Guaranty
#3 dated of even date herewith, executed by Wellspring, Inc., a Delaware
corporation (hereinafter referred to as "Wellspring"), in favor of the
Administrative Agent, for the benefit of all of the Lenders, pursuant to which
Wellspring has agreed to guaranty all of the obligations of the Borrowers in
connection with the Loan Facilities, as said Agreement of Guaranty #3 may be
from time to time
amended, modified, extended, renewed, refinanced and/or supplemented.
"AGREEMENTS OF LEASE" shall mean a collective reference to those certain
lease agreements between any one or more of the Borrowers, as tenants, and
various owners, as landlords (all as more fully set forth and described on
SCHEDULE 1.01-A hereto), pursuant to which such Borrowers have agreed to lease
certain real property from their respective landlords.
"APPLICABLE CANADIAN PENSION LEGISLATION" shall mean, at any time, any
pension legislation applicable to the Canadian Borrower, including, without
limitation, the Pension Benefits Act (Ontario) and the Pension Benefits
Standards Act, 1985 (Canada), and all regulations promulgated thereunder, as
amended and/or modified from time to time.
"APPLICABLE MARGIN" shall have the meaning set forth in SECTION 2.05(i)(c)
of this Loan Agreement.
"ASSIGNMENT AND ACCEPTANCE AGREEMENT" shall mean an Assignment and
Acceptance Agreement in the form of EXHIBIT "B" attached hereto and made a part
hereof (with all blanks noted therein appropriately filled in), delivered to the
Administrative Agent in connection with an assignment to an Eligible Assignee of
all or a portion of a Lender's interests under this Loan Agreement pursuant to
the terms, conditions and provisions of SECTION 11.02 hereof.
"AUTHORIZED OFFICER" shall mean those officers of the Borrowers whose
signatures and incumbency shall have been certified to the Administrative Agent
pursuant to an Officer's Certificate delivered on the Closing Date or any other
form of resolution or certification delivered to and approved by the
Administrative Agent after the Closing Date.
"BA MARGIN" shall mean the applicable percentage set forth in the Leverage
Matrix under the heading "BA MARGIN".
"BANK ACT SECURITY" shall mean a collective reference to (i) the Notice of
Intention to Give Security under the BANK ACT (Canada), which notice of
intention is dated February 19, 2001, (ii) the Application for Credit and
Promise to Give Security, which application is dated the date of this Loan
Agreement, (iii) the Agreement as to Loans and Advances, which agreement is
dated the date of this Loan Agreement and (iv) the Security under Section 427 of
the BANK ACT (Canada), which security is dated the date of this Loan Agreement,
all executed and delivered by the Canadian Borrower to and in favor of Mellon
Bank, N.A., Canada Branch.
"BANKRUPTCY ACT" shall mean the Bankruptcy and Insolvency Act (Canada) as
amended from time to time, or any successor statute.
"BANKRUPTCY CODE" shall mean Title 11 of the United States Bankruptcy Code
(11 U.S.C. Section 101 ET SEQ.), as amended from time to time, or any successor
statute.
"BASE RATE" shall mean (i) with respect to the US Revolving Credit Loan
Facility and the Acquisition/Term Loan Facility, the fluctuating rate per annum
announced from time to time by the Administrative Agent as a means of pricing
some loans to its customers and is neither tied to any external rate of interest
or index nor does it necessarily reflect the lowest rate of interest actually
charged by the Administrative Agent to any particular class or category of
customers of the Administrative Agent and (ii) with respect to the Canadian
Revolving Credit Loan Facility, the fluctuating rate per annum announced from
time to time by the Canadian Collateral Agent as a means of pricing some loans
to its customers and is neither tied to any external rate of interest or index
nor does it necessarily reflect the lowest rate of interest actually charged by
the Canadian Collateral Agent to any particular class or category of customers
of the Canadian Collateral Agent.
"BASE RATE LOANS" shall mean all Revolving Credit Loans and
Acquisition/Term Loans outstanding from time to time which bear interest at a
rate determined by reference to the Base Rate as provided for in SECTION 2.05(I)
of this Loan Agreement.
"BASE RATE OPTION" shall mean one of the two interest rates available to
the Borrowers as provided for and described in SECTION 2.05(i)(a)(1) and SECTION
2.05(i)(b)(1) of this Loan Agreement.
"BASE RATE PORTION" of any Borrowing or Borrowings shall mean at any time
the portion, which may include the whole of such Borrowing or Borrowings, of
such Borrowing or Borrowings bearing interest at such time under the Base Rate
Option. If no Borrowing is or if no Borrowings are specified, all references in
this Loan Agreement to "Base Rate Portion" shall refer to the Base Rate Portion
of all Borrowings outstanding at such time.
"BENEFICIAL OWNER" and "BENEFICIAL OWNERSHIP" - a Person shall be deemed
to be the "Beneficial Owner" of, and shall be deemed to "beneficially own", and
shall be deemed to have "Beneficial Ownership" of, any Securities:
(i) which such Person or any of such Person's Affiliates or
Associates is deemed to "beneficially own" within the meaning of Rule 13d-3 of
the General Rules and Regulations under the Securities Exchange Act, as in
effect on the date of this Loan Agreement; and/or
(ii) which such Person or any of such Person's Affiliates or
Associates has (a) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (written or oral), or upon the exercise of
conversion rights, exchange rights, rights, warrants or options, or otherwise;
PROVIDED, HOWEVER, that a Person shall not be deemed the Beneficial Owner of, or
to beneficially own, or to have Beneficial Ownership of, Securities tendered
pursuant to a tender or exchange offer made by or on behalf of such Person or
any of such Person's Affiliates or Associates until such tendered Securities are
accepted for purchase or exchange thereunder, or (b) the right to
vote pursuant to any agreement, arrangement or understanding (written or oral);
PROVIDED, HOWEVER, that a Person shall not be deemed the Beneficial Owner of, or
to beneficially own, any Security if (1) the agreement, arrangement or
understanding (written or oral) to vote such Security arises solely from a
revocable proxy or consent given to such Person in response to a public proxy or
consent solicitation made pursuant to, and in accordance with, the applicable
rules and regulations under the Securities Exchange Act, and (2) the beneficial
ownership of such Security is not also then reportable on Schedule 13D under the
Securities Exchange Act (or any comparable or successor report); and/or
(iii) which are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (written or oral) for
the purpose of acquiring, holding, voting (except pursuant to a revocable proxy
as described in CLAUSE (ii)(b) of this definition above) or disposing of any
Securities of Cantel Medical,
PROVIDED, HOWEVER, that, notwithstanding the foregoing, nothing contained in
this definition shall cause a Person ordinarily engaged in business as an
underwriter of Securities to be the "Beneficial Owner" of, or to "beneficially
own", any Securities acquired in a bona fide firm commitment underwriting
pursuant to an underwriting agreement with Cantel Medical.
"BENEFIT PLAN" shall mean a defined benefit plan as defined in Section 3
(35) of ERISA (other than a Multiemployer Plan) in respect of which any of the
Borrowers or an ERISA Affiliate of any Borrower is, or within the immediately
preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA.
"BIG FIVE ACCOUNTING FIRM" shall mean any of Arthur Andersen & Co., KPMG
Peat Marwick, Ernst & Young LLP, Deloitte & Touche and Pricewaterhouse Coopers
or any of their respective successors, including, without limitation, any of
their respective successors by merger.
"BORROWER" and "BORROWERS" shall mean a collective reference to (i) the US
Borrowers and (ii) the Canadian Borrower.
"BORROWING" and/or "BORROWINGS" shall mean a borrowing consisting of (i)
US Revolving Credit Loans and/or Acquisition/Term Loans, as applicable, made on
the same day by all or some of the US Lenders, as applicable, and (ii) Canadian
Revolving Credit Loans made on the same day by the Canadian Lenders.
"BORROWING BASE CERTIFICATE" shall mean (i) with respect to the US
Revolving Credit Loan Facility, a certificate duly executed by an Authorized
Officer of the US Borrowers in the form of EXHIBIT "C-1" attached hereto and
made a part hereof, setting forth the US Borrowers' calculations of the Advance
Limit for purposes of determining the availability of a Borrowing under the US
Revolving Credit Loan Facility and (ii) with respect to the Canadian Revolving
Credit Loan Facility, a certificate duly executed by an Authorized Officer of
the Canadian
Borrower in the form of EXHIBIT "C-2" attached hereto and made a part hereof,
setting forth the Canadian Borrower's calculations of the Advance Limit for
purposes of determining the availability of a Borrowing under the Canadian
Revolving Credit Loan Facility.
"BORROWING DATE" shall mean, with respect to (i) any US Revolving Credit
Loan, any Business Day specified in any Notice of Borrowing delivered to the
Administrative Agent by the US Borrowers in accordance with the provisions of
SECTION 2.01(ii) of this Loan Agreement, as the date upon which the US Borrowers
request the US Lenders then holding a US Revolving Credit Commitment to make
available a US Revolving Credit Loan hereunder (including a conversion or
rollover of credit) and upon which such US Revolving Credit Loan is made, (ii)
any Canadian Revolving Credit Loan, any Business Day specified in any Notice of
Borrowing delivered to the Canadian Collateral Agent by the Canadian Borrower in
accordance with the provisions of SECTION 2.02(ii) of this Loan Agreement, as
the date upon which the Canadian Borrower requests the Canadian Lenders to make
available a Canadian Revolving Credit Loan hereunder (including a conversion or
rollover of credit) and upon which such Canadian Revolving Credit Loan is made
and (iii) any Acquisition/Term Loan, any Business Day specified in any Notice of
Borrowing delivered to the Administrative Agent by the US Borrowers in
accordance with the provisions of SECTION 2.03(ii) of this Loan Agreement, as
the date upon which the US Borrowers request the US Lenders then holding an
Acquisition/Term Loan Commitment to make available an Acquisition/Term Loan
hereunder and upon which such Acquisition/Term Loan is made.
"BUSINESS DAY" shall mean (i) for all purposes (other than as covered by
CLAUSES (ii) and (iii) below), any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New Jersey and/or the
laws of the Province of Ontario (Canada) or is a day upon which banking
institutions located in such state or province are required or authorized by law
or other governmental action to close, (ii) with respect to all notices,
determination, fundings and payments in connection with the Eurodollar Rate, any
day which is a Business Day described in CLAUSE (i) above and which is also a
day for trading by and between banks in the London interbank eurodollar market
and (iii) when such term is used in respect of a day on which a Canadian
Revolving Credit Loan is to be made or an interest rate with respect thereto is
to be set, a payment is to be made in respect of a Canadian Revolving Credit
Loan, an Exchange Rate is to be set in respect of Canadian Dollars or any other
dealing in Canadian Dollars is to be carried out pursuant to this Agreement,
such term shall mean a day on which banks in Toronto, Ontario are open for
general banking business, other than a Saturday, Sunday or other day on which
commercial banks in Toronto, Ontario are authorized or required by law to close.
"CALCULATION DATE" shall have the meaning ascribed and assigned to such
term as set forth in SECTION 2.15(i) of this Loan Agreement.
"CANADIAN BANKERS ACCEPTANCE" and "CANADIAN BANKERS ACCEPTANCES" shall
mean a non-interest bearing bill of exchange denominated in Canadian Dollars,
drawn and endorsed by or on behalf of the Canadian Borrower and accepted by a
Canadian Lender pursuant to this Agreement,
having a term of one (1) month, two (2) months or three (3) months, and maturing
on a Business Day no later than five (5) days prior to the Canadian Revolving
Credit Termination Date, as the case may be, which may be issued in the form of
a "depository bill" and deposited with a "clearing house" as each such term is
defined in the DEPOSITORY BILLS AND NOTES ACT (Canada) and in respect of which
each Canadian Lender purchasing any such bill of exchange shall make the net
proceeds available to the Canadian Borrower as a Canadian Revolving Credit Loan
after deducting the Acceptance Fee and the amount resulting from the application
of the Discount Rate.
"CANADIAN BANKERS ACCEPTANCE NOTICE" shall have the meaning ascribed and
assigned to such term as set forth in SECTION 2.06(i)(a) of this Loan Agreement.
"CANADIAN BORROWER" shall have the meaning assigned and ascribed to such
term as set forth in the preamble to this Loan Agreement.
"CANADIAN COLLATERAL" shall mean all of the Collateral which is now or
hereafter located in Canada.
"CANADIAN COLLATERAL AGENT" shall have the meaning assigned and ascribed
to such term as set forth in the preamble of this Loan Agreement.
"CANADIAN DOLLAR", "CANADIAN DOLLARS" and the symbol "C$" shall mean
lawful money of Canada.
"CANADIAN DOLLAR EQUIVALENT" shall mean, with respect to the amount of any
US Dollars on any date, the equivalent amount in Canadian Dollars that may be
purchased with such amount of US Dollars, as determined by the Canadian
Collateral Agent using the Exchange Rate.
"CANADIAN LENDER" and "CANADIAN LENDERS" shall mean a collective reference
to (i) Mellon Canada and (ii) any other Lender holding a Canadian Revolving
Credit Commitment.
"CANADIAN LETTER OF CREDIT" and "CANADIAN LETTERS OF CREDIT" shall mean a
reference to any sight commercial/documentary or standby letter of credit issued
for the account of the Canadian Borrower by an Issuing Bank pursuant to SECTION
2.02(vi) of this Loan Agreement and denominated in Canadian Dollars or in US
Dollars, as selected by the Canadian Borrower.
"CANADIAN LETTER OF CREDIT OBLIGATIONS" shall mean, at any time, the sum
of (i) Canadian Reimbursement Obligations at such time for Canadian Letters of
Credit and (ii) the Dollar Equivalent of the aggregate maximum amount then
available for drawing under the outstanding Canadian Letters of Credit.
"CANADIAN LETTER OF CREDIT SUBLIMIT" shall mean, as of any date of
determination, the lesser of (i) the difference between (a) the Advance Limit
with respect to the Canadian Revolving
Credit Loan Facility as of such date of determination MINUS (b) the aggregate
outstanding principal amount of all Canadian Revolving Credit Loans as of such
date of determination or (ii) the difference between (a) US$1,000,000.00 MINUS
(b) the aggregate outstanding principal amount of all Canadian Revolving Credit
Loans in excess of US$4,000,000.00 as of such date of determination.
"CANADIAN REIMBURSEMENT OBLIGATIONS" shall mean the Dollar Equivalent of
the unpaid reimbursement or repayment obligations of the Canadian Borrower to
all Issuing Banks pursuant to all Letter of Credit Reimbursement Agreements for
amounts paid out under Canadian Letters of Credit.
"CANADIAN REVOLVING CREDIT ACCOMMODATIONS" shall mean, at any time, the
sum of (i) all Canadian Revolving Credit Loans outstanding at such time and (ii)
all Canadian Letter of Credit Obligations outstanding at such time.
"CANADIAN REVOLVING CREDIT COMMITMENT" shall mean, with respect to each
Canadian Lender, as of any date of determination, such Canadian Lender's Pro
Rata Share of the amount of the Canadian Revolving Credit Loan Facility, as of
such date, which percentage and amount shall be set forth on the signature pages
to this Loan Agreement and/or in any Assignment and Acceptance Agreement.
"CANADIAN REVOLVING CREDIT COMMITMENTS" shall mean, as of any date of
determination, collectively, the aggregate amount of the Canadian Revolving
Credit Commitment of all of the Canadian Lenders as of such date.
"CANADIAN REVOLVING CREDIT EXPOSURE" shall have the meaning ascribed and
assigned to such term as set forth in SECTION 11.02(i)(g) of this Loan
Agreement.
"CANADIAN REVOLVING CREDIT LOAN" and "CANADIAN REVOLVING CREDIT LOANS"
shall have the meaning ascribed and assigned to such term in SECTION 2.02(i)(a)
of this Loan Agreement, and which shall specifically include, Canadian Bankers
Acceptances.
"CANADIAN REVOLVING CREDIT LOAN FACILITY" shall have the meaning ascribed
and assigned to such term in the second recital of this Loan Agreement.
"CANADIAN REVOLVING CREDIT LOAN NOTE" and "CANADIAN REVOLVING CREDIT LOAN
NOTES" shall mean those Canadian Revolving Credit Loan Notes in substantially
the form attached hereto as EXHIBIT "D" with all requisite blanks appropriately
filled, each such note payable to the order of a Canadian Lender, in a face
amount equal to such Canadian Lender's Pro Rata Share of the Canadian Revolving
Credit Commitments.
"CANADIAN REVOLVING CREDIT TERMINATION DATE" shall mean the earliest to
occur of (i) February 22, 2004, (ii) the date of the permanent termination of
the Canadian Revolving Credit
Commitments pursuant to SECTION 2.02(v) of this Loan Agreement or (iii) the date
of termination of the Canadian Revolving Credit Commitments pursuant to SECTION
9.02 of this Loan Agreement.
"CAPITAL EXPENDITURES" shall mean, for any period, the aggregate of all
expenditures (whether paid in cash or accrued as liabilities during such period)
of each of the Borrowers and/or each of their respective Subsidiaries, which
would be properly classified as capital expenditures in accordance with
Generally Accepted Accounting Principles (including, without limitation,
expenditures for maintenance and repairs which are capitalized, and Capitalized
Leases to the extent an asset is recorded in connection therewith in accordance
with Generally Accepted Accounting Principles).
"CAPITALIZED LEASE" and "CAPITALIZED LEASES" shall mean at any time any
lease which is, or is required under Generally Accepted Accounting Principles to
be, capitalized on the balance sheet of the lessee at such time.
"CAPITALIZED LEASE OBLIGATION" and "CAPITALIZED LEASE OBLIGATIONS" shall
mean all monetary obligations of any Person under any leasing or similar
arrangement which, in accordance with Generally Accepted Accounting Principles,
are or would be classified as Capitalized Leases.
"CASH AND CASH EQUIVALENTS" with respect to any Person shall mean (i) all
cash and cash equivalents owned by such Person and (ii) any of the following
owned by such Person: (a) marketable direct obligations issued or
unconditionally guarantied by the United States Government or issued by an
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one (1) year after the date of acquisition thereof;
(b) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one (1) year after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from any two (2) of Standard & Poor's Corporation,
Moody's Investors Service, Inc., Duff and Phelps or Fitch Investors (or, if at
any time no two of the foregoing shall be rating such obligations, then from
such other nationally recognized rating services as may be acceptable to the
Lender) and not listed for possible down-grade in Credit Watch published by
Standard & Poor's Corporation; (c) commercial paper of a corporation having a
net worth of not less than US$1,000,000,000.00, other than commercial paper
issued by any of the Borrowers and/or any of their respective Subsidiaries,
maturing no more than ninety (90) days after the date of creation thereof and,
at the time of acquisition, having a rating of at least A-1 or P-1 from either
Standard & Poor's Corporation or Moody's Investors Service, Inc.; (d) domestic
certificates of deposit or domestic time deposits or repurchase agreements
maturing within one (1) year after the date of acquisition thereof issued by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia having FDIC deposit insurance, and, in
any case, having assets of not less than US$500,000,000.00; (e) any funds
deposited or invested by any of the Borrowers and/or any of their respective
Subsidiaries in accounts maintained with the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and/or any of the Lenders and/or
with any other commercial bank organized under the laws of (1) Canada having
insurance with CDIC or (2) the United States of America or any state thereof or
the District of Columbia having FDIC insurance, and, in either case, having
assets of not less than US$500,000,000.00; and (f) money market funds having
assets under management in excess of US$2,000,000,000.00.
"CDIC" shall mean the Canada Deposit Insurance Corporation.
"CERCLIS" shall mean the Comprehensive Environmental Response,
Compensation and Liability Information System List, as the same may be amended
from time to time.
"CHANGE OF CONTROL" of Cantel Medical shall mean the earlier to occur of
(i) such time as the Administrative Agent and/or Cantel Medical learns that a
Person has become an Acquiring Person, (ii) the Close of Business on such date,
if any, as may be designated by the Administrative Agent following the
commencement of, or the first public disclosure of, a tender or exchange offer
by any Person (other than Cantel Medical) for outstanding Common Shares, if upon
consummation of such tender or exchange offer such Person could be the
Beneficial Owner of more than thirty percent (30%) of the then outstanding
Common Shares or (iii) a change in a simple majority of the Persons who serve as
directors on the Board of Directors of Cantel Medical, whether in a single
action or in multiple actions; PROVIDED, HOWEVER, that, notwithstanding the
limitation set forth in CLAUSE (iii) above, the members of the Board of
Directors of Cantel Medical who are in place as of the Closing Date shall be
permitted to appoint, approve or select new, substitute and/or replacement
directors for the Board of Directors of Cantel Medical.
"CLAIM" shall mean any claim or demand, by any Person, of whatsoever kind
or nature for any alleged Liabilities and Costs, based in dispute whether based
in contract, tort, implied or express warranty, strict liability, criminal or
civil statute, permit, ordinance or regulation, common law or otherwise, the
consequences of which disputes are reasonably likely to have a Material Adverse
Effect.
"CLOSE OF BUSINESS" on any given date shall mean 5:00 P.M. (New York City,
New York time), on such date; PROVIDED, HOWEVER, that, if such date is not a
Business Day, the term "Close of Business" shall mean 5:00 P.M. (New York City,
New York time), on the next succeeding Business Day.
"CLOSING DATE" shall mean the date upon which this Loan Agreement is
executed by the Lenders, the Borrowers, the Administrative Agent, the US
Collateral Agent and the Canadian Collateral Agent, and the conditions set forth
in SECTION 3.01 of this Loan Agreement have been completed and fulfilled to the
satisfaction of the Administrative Agent.
"CODE" means the Internal Revenue Code of 1986, as amended, any successor
statute of
similar import, and regulations thereunder, in each case as in effect from time
to time. References to sections of the Code shall be construed also to refer to
any successor sections.
"COLLATERAL" shall mean all now owned or hereafter acquired property,
assets, contracts, interests and/or rights on or in which a Lien is granted to
(i) the Canadian Collateral Agent, with respect to the Canadian Collateral and
(ii) the US Collateral Agent, with respect to the US Collateral, in both cases
on behalf of the applicable Lenders, pursuant to the terms, conditions and
provisions of this Loan Agreement, the Pledge of Stock Agreements, the Security
Agreements and/or any other Collateral Documents provided for herein or therein
or delivered or to be delivered hereunder or thereunder, as any such Collateral
Document may be amended, supplemented, restated or otherwise modified from time
to time in accordance with the terms, conditions and provisions hereof or
thereof.
"COLLATERAL DOCUMENTS" shall mean the collective reference to the Security
Agreements, the Pledge of Stock Agreements, the Agreements of Guaranty, the Bank
Act Security and any other security agreements, mortgages, deeds of trust,
collateral assignments, instruments, documents, certificates or agreements
executed and delivered by, or on behalf of, the Borrowers and/or any other
Person, to the US Collateral Agent and/or the Canadian Collateral Agent, in both
cases on behalf of the Lenders, at any time pursuant to or in connection with
the Loan Facilities to create, continue or evidence Liens to secure the
Obligations (WHICH, HOWEVER, in the case of any Swap Obligations, all said Liens
shall be subordinated to the senior and superior interests of the US Collateral
Agent, the Canadian Collateral Agent and the Lenders in the Collateral securing
the Obligations of the Borrowers under this Loan Agreement and the other Loan
Documents, EXCLUSIVE of the Swap Obligations).
"COMMITMENT PERCENTAGE" of any Lender at any time shall mean the
percentages for such Lender set forth below its name on the signature pages to
this Loan Agreement with respect to its Pro Rata Share of the applicable Loan
Facilities, adjusted from time to time to give effect to any transfer by one
Lender to another Lender (as an Eligible Assignee) of all or any portion of said
Lender's Pro Rata Share, all as provided for in SECTION 11.02 of this Loan
Agreement. A US Lender may have (but is not obligated to have) a Pro Rata Share
of either or both of the US Revolving Credit Loan Facility and the
Acquisition/Term Loan Facility. No Canadian Lender may have a Pro Rata Share of
the US Revolving Credit Loan Facility and/or the Acquisition/Term Loan Facility.
No US Lender may have a Pro Rata Share of the Canadian Revolving Credit Loan
Facility.
"COMMITMENTS" shall mean a collective reference to (i) one hundred percent
(100%) of the US Revolving Credit Commitments, (ii) one hundred percent (100%)
of the Acquisition/Term Loan Commitments and (iii) one hundred percent (100%) of
the Canadian Revolving Credit Commitments.
"COMMON SHARES" shall mean the shares of authorized, issued and
outstanding voting capital stock of Cantel Medical or any other shares of
capital stock of Cantel Medical into which
such voting capital stock shall be reclassified or changed.
"CONSOLIDATED DEBT" shall mean, with respect to any Person, the aggregate
sum of the following items as such items may appear on a consolidated and
consolidating balance sheet of Cantel Medical and its Subsidiaries in accordance
with Generally Accepted Accounting Principles: (i) the unpaid principal balance
of all indebtedness or liability for money borrowed by such Person owed to any
other Person (other than to Cantel Medical and/or any of its Subsidiaries) from
time to time (including any renewals, extensions and refundings thereof),
whether or not the indebtedness or liability was heretofore or hereafter
created, issued, incurred, assumed or guaranteed; (ii) the unpaid principal
balance of all indebtedness of such Person or liability of such Person for the
deferred purchase price of property or services incurred (excluding trade
obligations, employee compensation, taxes payable and other accrued expenses);
(iii) all obligations of such Person as lessee under leases which have been or
should be recorded as Capitalized Lease Obligations; (iv) all current
obligations of such Person in respect of any unfunded vested benefits under any
Plan covered by Title IV of ERISA; (v) all obligations of such Person,
contingent or otherwise, relative to the face amount of all letters of credit
issued for the account of any of the Borrowers and/or any of their respective
Subsidiaries, whether or not drawn; (vi) all obligations of such Person arising
under bankers' acceptance facilities issued for the account of any of the
Borrowers and/or any of their respective Subsidiaries; (vii) all guaranties,
endorsements and other contingent obligations of such Person to purchase, to
provide funds for payments, to supply funds to invest in any of the Borrowers
and/or any of their respective Subsidiaries or otherwise to assure a creditor
against loss (except endorsements of negotiable instruments for deposit or
collection in the ordinary course of business shall not constitute Consolidated
Debt); and (viii) all obligations of such Person secured by any mortgage, lien,
pledge, or security interest or other charge or encumbrance on property, whether
or not the obligations have been assumed.
"CONSOLIDATED EBIT" shall mean, with respect to any Person, as of any date
of determination thereof, for the period of four (4) consecutive Fiscal Quarters
immediately preceding said date of determination taken together as one
accounting period, the amount equal to the sum of (i) Consolidated Net Income
for such Person for such test period, plus (ii) all gross interest expense on
Consolidated Debt of such Person for such test period, PLUS (iii) all charges
against income of such Person for foreign, federal, state and local income taxes
for such test period, PLUS (iv) all other net non-cash charges (exclusive of
depreciation and amortization) for such Person for such test period, after
eliminating therefrom any (a) extraordinary items, (b) gains and losses from the
sale of assets in connection with any sale/leaseback transaction or arrangement
and (c) results of discontinued operations, all as determined in accordance with
Generally Accepted Accounting Principles and all to the extent not previously
eliminated in the calculation of Consolidated Net Income.
"CONSOLIDATED EBITDA" shall mean, with respect to any Person, as of any
date of determination thereof, for the period of four (4) consecutive Fiscal
Quarters immediately preceding said date of determination taken together as one
accounting period, the amount equal
to the sum of (i) Consolidated Net Income for such Person for such test period,
plus (ii) all gross interest expense on Consolidated Debt of such Person for
such test period, PLUS (iii) all charges against income of such Person for
foreign, federal, state and local income taxes for such test period, PLUS (iv)
all depreciation expense for such Person for such test period, PLUS (v) all
amortization expense for such Person for such test period PLUS (vi) all other
net non-cash charges for such Person for such test period, after eliminating
therefrom any (a) extraordinary items, (b) gains and losses from the sale of
assets in connection with any sale/leaseback transaction or arrangement and (c)
results of discontinued operations, all as determined in accordance with
Generally Accepted Accounting Principles and all to the extent not previously
eliminated in the calculation of Consolidated Net Income.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" shall mean, with respect to any
Person, as of any date of determination thereof, for the period of four (4)
consecutive Fiscal Quarters immediately preceding said date of determination
taken together as one accounting period, the ratio of (i) Consolidated EBITDA
for such Person for such test period MINUS all Capital Expenditures of such
Person paid or incurred by such Person during said test period DIVIDED BY (ii)
the sum of (a) all interest expense on all Consolidated Debt of such Person
outstanding during such test period PLUS (b) all principal payments due and
payable on all Consolidated Debt of such Person outstanding during such test
period PLUS (c) all charges against income of such Person for foreign, federal,
state and local taxes for such test period, PLUS (d) all cash dividends,
distributions and other payments paid by such Person, PLUS (e) all payments in
respect of Capitalized Leases for such Person for such test period, all as
calculated in accordance with Generally Accepted Accounting Principles, PLUS (f)
all amounts paid by such Person in connection with any Stock Repurchase Program.
"CONSOLIDATED FUNDED DEBT" shall mean, with respect to any Person, as of
any date of determination thereof, all items which in accordance with Generally
Accepted Accounting Principles would be Consolidated Debt of such Person,
including, without limitation, all Consolidated Subordinated Debt of such
Person, but exclusive of those items described in CLAUSES (IV) AND (VII) of the
definition of Consolidated Debt.
"CONSOLIDATED FUNDED DEBT LEVERAGE RATIO" shall mean, with respect to any
Person, as of any date of determination thereof, the ratio of the Consolidated
Funded Debt of such Person DIVIDED BY the Consolidated EBITDA of such Person.
"CONSOLIDATED INTEREST COVERAGE RATIO" shall mean, with respect to any
Person, as of any date of determination thereof, for the period of four (4)
consecutive Fiscal Quarters immediately preceding said date of determination
taken together as one accounting period, the ratio of (i) Consolidated EBIT of
such Person DIVIDED BY (ii) all interest expense on all Consolidated Debt of
such Person outstanding during such test period.
"CONSOLIDATED NET INCOME" shall mean, with respect to any Person, as of
any date of determination for any test period, all amounts which, in accordance
with Generally Accepted
Accounting Principles, would be included under net income of such Person (after
the provision for the payment of all foreign, federal, state, provincial and
local taxes of such Person) on a consolidated and consolidating income statement
of Cantel Medical and its Subsidiaries for such test period LESS "extraordinary
items", as such term is defined by Generally Accepted Accounting Principles.
"CONSOLIDATED SUBORDINATED DEBT" shall mean, with respect to any Person,
as at any date of determination, any Consolidated Debt of such Person which, in
accordance with the terms of the documentation evidencing said Consolidated
Debt, is subordinated to the repayment of the Loan Facilities on terms
satisfactory to the Requisite Lenders.
"CONSOLIDATED TANGIBLE NET WORTH" shall mean, with respect to any Person,
as at any date of determination, (i) all items which, in accordance with
Generally Accepted Accounting Principles, would be included under such Person's
shareholders' equity on a consolidated and consolidating balance sheet of Cantel
Medical and its Subsidiaries at such date MINUS (ii) the book value of all
intangible assets, goodwill and/or deferred charges of such Person.
"CONTRACTUAL OBLIGATION" shall mean with respect to any Person, any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, contract, undertaking, document, instrument or other agreement or
instrument to which that Person is a party or by which it or any of its
properties is bound, or to which it or any of its properties is subject
(including, without limitation, any restrictive covenant affecting such Person
or any of its properties).
"CORPORATE GUARANTOR" and "CORPORATE GUARANTORS" shall mean a reference to
one or more of (i) Cantel Medical, in its capacity as a "Corporate Guarantor"
under the Agreement of Guaranty #1 and the Agreement of Guaranty #2, (ii)
MediVators, in its capacity as a "Corporate Guarantor" under the Agreement of
Guaranty #1 and the Agreement of Guaranty #2, (iii) Wellspring, Inc., a Delaware
corporation, in its capacity as a "Corporate Guarantor" under the Agreement of
Guaranty #3 and (iv) any domestic Subsidiary of Cantel Medical which is
purchased, acquired or formed during the term of the Loan Facilities and which
is required to execute any Agreement of Guaranty pursuant to the terms,
conditions and provisions of SECTION 6.12 of this Loan Agreement.
"CUSTOMARY PERMITTED LIENS" shall mean:
(i) Liens (other than Environmental Liens and any Lien imposed under
ERISA) for taxes, assessments, charges or claims of any Governmental Authority
not yet due or which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with Generally Accepted Accounting
Principles;
(ii) statutory Liens of landlord and Liens of carriers,
warehousemen,
mechanics, materialmen and other Liens (other than any Lien imposed under ERISA)
imposed by Law, including, without limitation, Liens in favor of any
Governmental Authority securing progress payments made under government
contracts created in the ordinary course of business and for amounts not yet due
or which are being contested in good faith by appropriate proceedings which are
sufficient to prevent imminent foreclosure of such Liens, are promptly
instituted and diligently conducted and with respect to which adequate reserves
or other appropriate provision are being maintained in accordance with Generally
Accepted Accounting Principles;
(iii) Liens (other than any Lien imposed under ERISA) incurred or
deposits made in the ordinary course of business (including, without limitation,
surety bonds and appeal bonds) in connection with workers' compensation,
unemployment insurance and other types of social security benefits which have
accrued but are not yet payable or due to be remitted or to secure the
performance of tenders, bids, leases, contracts (other than for the repayment of
Consolidated Debt), statutory obligations and other similar obligations or
arising as a result of progress payments under government contracts;
(iv) easements (including, without limitation, reciprocal easement
agreements and utility agreements), rights-of-way, covenants, consents,
reservations, encroachments, variations and other restrictions, charges or
encumbrances (whether or not recorded) affecting the use of real property or
impair the use thereof;
(v) Liens arising as a result of filing of any financing statement
under the Uniform Commercial Code of a particular State, the Personal Property
Security Act (Ontario) or any comparable Law of any jurisdiction covering
consigned or leased goods which do not constitute assets of any of the Borrowers
and/or their Subsidiaries and which consignment and/or lease is not intended as
security;
(vi) Liens in favor of customers arising out of and with respect to
customer deposits made in the ordinary course of the Borrowers' and/or their
Subsidiaries businesses;
(vii) Liens, security interests and other encumbrances as listed on
SCHEDULE 1.01-B; and
(viii) extensions, renewals or replacements of any Lien referred to
in SUBPARAGRAPHS (i) THROUGH (vii) above, PROVIDED THAT (a) in the case of
SUBPARAGRAPHS (i), (ii), (iii), (v), (vi) AND (vii) above, the principal amount
of the obligation secured thereby is not increased and (b) any such extension,
renewal or replacement is limited to the property originally encumbered thereby.
"DEFAULT RATE" shall mean a rate of interest per annum equal to two
hundred basis points (2.0%) above the applicable nondefault interest rate(s)
then in effect with respect to any outstanding Loan or Loans.
"DISCOUNT" shall mean, with respect to any issue of Canadian Bankers
Acceptances, the amount by which the face value of such Canadian Bankers
Acceptances exceeds the Discounted Proceeds of such Canadian Bankers
Acceptances.
"DISCOUNTED PROCEEDS" shall mean, with respect to any Canadian Bankers
Acceptance to be purchased by a Canadian Lender, an amount (rounded to the
nearest whole Canadian cent, and with one-half of one Canadian cent being
rounded up) calculated on the day of such purchase by multiplying (i) the face
amount of such Canadian Bankers Acceptance times (ii) the quotient equal to
(such quotient being rounded up or down to the nearest fifth decimal place and
.000005 being rounded up) (a) one DIVIDED BY (b) the sum of (1) one PLUS (2) the
product of (A) the Discount Rate (expressed as a decimal) applicable to such
Canadian Bankers Acceptance TIMES (B) the quotient equal to (x) the term to
maturity of such Canadian Bankers Acceptance DIVIDED BY (y) the number of days
in the calendar year in which such Canadian Bankers Acceptance is to mature.
"DISCOUNT RATE" as applicable to a Canadian Bankers Acceptance being
purchased by any Canadian Lender on any day, the percentage discount rate
(expressed to two decimal places and rounded upward, if necessary, to the
nearest 1/100th of 1%) quoted by the Canadian Collateral Agent as the percentage
discount rate at which the Canadian Collateral Agent would, in accordance with
normal practice, at or about 9:30 A.M. (Toronto, Ontario time), on such day, be
prepared to purchase Canadian Bankers Acceptances accepted by it in an amount
and having a maturity date comparable to the amount and maturity date of such
Canadian Bankers Acceptance.
"DOL" shall mean the United States Department of Labor and any successor
department or agency.
"DOLLAR EQUIVALENT" means, with respect to (i) the amount of any Canadian
Dollars on any date, the equivalent amount in US Dollars that may be purchased
with such amount of Canadian Dollars, as determined by the Canadian Collateral
Agent using the Exchange Rate and (ii) any amount in US Dollars, such amount.
"ELIGIBLE ASSIGNEE" shall mean any Person(s), each of whom must be
reasonably acceptable to the Administrative Agent and the Borrowers; PROVIDED,
HOWEVER, in each such instance where said Person is a bank or other
institutional lender, said Person must then be in compliance with all then
applicable Laws regarding regulatory capital requirements after giving effect to
any "phase-in" provisions thereof; PROVIDED, FURTHER, that in the event that
such Person is purchasing and assuming a Canadian Revolving Credit Commitment,
such Person shall be resident in Canada for purposes of the Income Tax Act
(Canada) and qualified to conduct business in Canada under the BANK ACT (Canada)
or a trust or loan company under the applicable Laws of Canada or any Province
therein.
"ENVIRONMENT" shall mean all air, surface water, water, vapor,
groundwater, drinking
water supply or land, including land surface or subsurface, and includes all
fish, wildlife, biota and all other natural resources, whether located in the
United States, Canada or elsewhere.
"ENVIRONMENTAL APPROVAL" shall mean any Governmental Action pursuant to or
required under any Environmental Law.
"ENVIRONMENTAL CONCERN MATERIALS" shall mean (i) any flammable substance,
explosive, radioactive material, hazardous material, hazardous waste, toxic
substance, solid waste, pollution, contaminate or any related material, raw
material, substance, product or by-product of any substance specified in or
regulated or otherwise affected by any Environmental Law (including but not
limited to any "hazardous substance" as defined in any Environmental Law), (ii)
any toxic chemical or other substance from or related to industrial, commercial
or institutional activities, and (iii) asbestos, gasoline, diesel fuel, motor
oil, waste and used oil, heating oil and other petroleum products or compounds,
polychlorinated biphenyls, radon and urea-formaldehyde.
"ENVIRONMENTAL LAW" and "ENVIRONMENTAL LAWS" shall mean any Law, whether
now existing or subsequently enacted or amended, relating to (i) pollution or
protection of the Environment, (ii) exposure of Persons, including but not
limited to employees, to Environmental Concern Materials, (iii) protection of
the public health or welfare from the effects of products, by-products, wastes,
emissions, discharges or releases of Environmental Concern Materials and/or (iv)
regulation of the manufacture, generation, use or introduction into commerce of
Environmental Concern Materials including their manufacture, formulation,
packaging, labeling, distribution, treatment, transportation, handling, storage
or disposal. Without limitation, the defined term "Environmental Law" shall
include (a) any Environmental Approval and the terms and conditions thereof; (b)
any and all federal, state and local Laws including, without limitation, the
following statutes: the Clean Air Act (42 U.S.C.A.ss.7401 ET SEQ.); the
Comprehensive Environmental Response Compensation and Liability Act of 1980 (42
U.S.C.ss.9601 ET SEQ.); the Federal Water Pollution Control Act (33 U.S.C.
ss.1251 ET SEQ.), the Hazardous Material Transportation Act (49 U.S.C.ss.1801 ET
SEQ.); the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C.ss.136),
the Resource Conservation and Recovery Act of 1976 (42 U.S.C.ss.6901 ET SEQ.)
(including the Hazardous and Solid Waste Amendments of 1984), the Toxic
Substance Control Act (15 U.S.C.ss.2601 ET SEQ.), the Federal Occupational
Safety & Health Act of 1970 (29 U.S.C. ss.651 ET SEQ.) (includingss.3101 of the
Omnibus Reconciliation Act of 1990); the New Jersey Spill Compensation and
Control Act (N.J.S.A. 58:10-23.11 ET SEQ.); the New Jersey Industrial Site
Recovery Act formerly known as the New Jersey Environmental Cleanup
Responsibility Act (N.J.S.A. 13:lK-6 ET SEQ.); and the New Jersey Leaking
Underground Storage Tank Act (N.J.S.A. 58:l0A-21 ET SEQ.), and all regulations
promulgated thereunder and all as amended from time to time; (c) the
Environmental Protection Act (Ontario), the Water Resources Act (Ontario), the
Canadian Environmental Protection Act (1999), The Transportation of Dangerous
Goods Act (Canada), Dangerous Goods Transportation Act (Ontario), Pesticides Act
(Ontario), Occupational Health and Safety Act (Ontario), Gasoline Handling Act
(Ontario), Energy Act (Ontario), Sewer Use By-Laws, Fisheries Act (Canada), Pest
Control Products Act
(Canada), Hazardous Products Act (Canada), Canada Labour Code and any and all
regulations promulgated thereunder, all as may be from time to time amended
and/or modified, and (d) any common law doctrine (including, without limitation,
injunctive relief and tort, such as negligence, nuisance, trespass and strict
liability) that may impose obligations or liabilities for personal injury or
property damage due to, or threatened as a result of, the presence of or
exposure to Environmental Concern Materials.
"ENVIRONMENTAL LIEN" shall mean a Lien in favor of any Governmental
Authority for (i) any liability currently due and payable under any
Environmental Laws or (ii) damages arising from, or costs incurred by such
Governmental Authority in response to, a Release or threatened Release of any
Environmental Concern Material into the Environment.
"EQUIPMENT" of any Person, shall mean and include all of said Person's now
owned and hereafter acquired (i) machinery, (ii) manufacturing, distribution,
selling, data processing and office equipment and (iii) furniture, furnishings,
appliances, fixtures and trade fixtures, tools, toolings, molds, dies, vehicles,
vessels, aircraft and all other goods of every type and description (other than
Inventory).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute of similar import, together
with the regulations promulgated thereunder by the United States Treasury
Department, the Department of Labor and/or the PBGC.
"ERISA AFFILIATE" shall mean each trade or business (whether or not
incorporated) which together with all or any of the Borrowers would be deemed to
be a "single employer" within the meaning of Section 4001 of ERISA.
"EURODOLLAR AFFILIATE" shall mean with respect to each Lender, the
affiliate of such Lender, if any, including, without limitation, those
affiliates set forth on SCHEDULE 1.01-C attached to this Loan Agreement.
"EURODOLLAR INTEREST PAYMENT DATE" shall mean, with respect to any
Eurodollar Rate Loan, the last day of each Eurodollar Interest Period applicable
to such Eurodollar Rate Loan.
"EURODOLLAR INTEREST PERIOD" shall mean one or more periods of time during
which the Borrowers may select, convert to or continue a Eurodollar Rate Loan,
such funding period to be either a one (1), two (2) or three (3) month period
subject to availability, all as more fully subject to the provisions of SECTION
2.10 of this Loan Agreement.
"EURODOLLAR INTEREST RATE DETERMINATION DATE" shall mean the date on which
the Administrative Agent determines the Eurodollar Rate applicable to (i) a
Borrowing of a Eurodollar Rate Loan or (ii) the continuation or conversion of
Eurodollar Rate Loans. The Eurodollar Interest Rate Determination Date shall be
the second Business Day prior to the first
day of the Eurodollar Interest Period applicable to such Borrowing, continuation
or conversion.
"EURODOLLAR PORTION" of any Revolving Credit Loan and/or any
Acquisition/Term Loan shall mean at any time the portion, including the whole,
of such Revolving Credit Loan or such Acquisition/Term Loan which is bearing
interest at any time under the Eurodollar Rate.
"EURODOLLAR RATE" shall mean, with respect to any Eurodollar Interest
Period applicable to a Borrowing of Eurodollar Rate Loans, an interest rate per
annum determined by the Administrative Agent, for such Loans made by any US
Lender, or as determined by the Canadian Collateral Agent, for such Loans made
by any Canadian Lender, obtained by DIVIDING (i) the rate of interest determined
by such Agent in accordance with its usual procedures (which determination shall
be conclusive absent manifest error) to be the average (rounded upward to the
nearest whole multiple of one one-thousandth of one percent (1/1000 of 1%) per
annum if such average is not such a multiple) of the rates per annum at which
deposits in US Dollars are quoted to such Agent by the British Bankers'
Association, or its appropriate successor, as set forth on Dow Jones Markets
Service (formerly known as Telerate) display page 3750 (or such other display
page on the Dow Jones Markets Service system as may replace display page 3750),
or if British Banker's Association or its successor ceases to provide such
quote, a comparable replacement rate determined by such Agent (which
determination shall be conclusive absent manifest error), at approximately 11:00
A.M. (London time), on any applicable Eurodollar Interest Rate Determination
Date and in an amount substantially equal to the amount of the Eurodollar Rate
Loan to be made by the applicable Lenders and to be outstanding during such
Eurodollar Interest Period BY (ii) a number equal to 1.00 MINUS the Eurodollar
Reserve Percentage. The Eurodollar Rate shall be adjusted automatically on and
as of the effective date of any change in the Eurodollar Reserve Percentage.
Additionally, the "Eurodollar Rate" shall in all circumstances mean the rate of
interest which is customarily referred to as the "London Interbank Offered
Rate".
"EURODOLLAR RATE LOAN" and "EURODOLLAR RATE LOANS" shall mean a collective
reference to all of those Revolving Credit Loans and Acquisition/Term Loans
outstanding from time to time which bear interest at a rate determined by
reference to the Eurodollar Rate as provided for in SECTION 2.05(I) of this Loan
Agreement.
"EURODOLLAR RATE OPTION" shall mean one of the interest rates available to
the Borrowers as provided for and described in SECTION 2.05(i)(a)(2) and SECTION
2.05(i)(b)(2) of this Loan Agreement.
"EURODOLLAR RATE TAXES" shall have the meaning ascribed and assigned to
such term as set forth in SECTION 2.10(vii)(a) of this Loan Agreement.
"EURODOLLAR RESERVE PERCENTAGE" shall mean for any date that percentage,
if any, (expressed as a decimal, rounded upward to the nearest 1/100 of 1%), as
determined in good faith
by the Administrative Agent or the Canadian Collateral Agent, as applicable
(which determination shall be conclusive, if made in good faith, absent manifest
error) which is in effect on such date, as prescribed by the Federal Reserve
Board, with respect to the US Lenders, or as administered by the Office of the
Superintendent of Financial Institutions, with respect to the Canadian Lenders,
for determining the maximum reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve requirement) for a member
bank of the Federal Reserve System (or any successor thereto) or a Canadian bank
or other financial institution (or successor thereto), respectively, in respect
of "eurocurrency liabilities" having a term equal to the applicable Eurodollar
Interest Period (or in respect of any other category of liabilities which
includes deposits by reference to which the interest rate on Eurodollar Rate
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).
"EVENT OF DEFAULT" or "EVENTS OF DEFAULT" shall mean any of the events of
default as defined and described in SECTION 9.01 of this Loan Agreement.
"EXCHANGE RATE" shall mean, on any day, (i) with respect to Canadian
Dollars in relation to US Dollars, the spot rate as quoted by the Canadian
Collateral Agent as its NOON (or as near thereto as may be practicable) spot
rate at which US Dollars are offered on such day for Canadian Dollars and (ii)
with respect to US Dollars in relation to Canadian Dollars, the spot rate as
quoted by the Canadian Collateral Agent as its NOON (or as near thereto as may
be practicable) spot rate at which Canadian Dollars are offered on such day for
US Dollars.
"EXCESS CASH FLOW" shall mean as of any date of determination thereof for
the period of four (4) consecutive Fiscal Quarters immediately preceding said
date of determination, taken together as one accounting period, Consolidated
EBITDA of Cantel Medical and its domestic Subsidiaries MINUS the sum of, without
duplication (i) interest expense on all Consolidated Debt of Cantel Medical and
its domestic Subsidiaries paid for in cash for such test period, PLUS (ii)
principal amortization payments due and payable on all Consolidated Debt of
Cantel Medical and its domestic Subsidiaries paid in cash during such test
period, PLUS (iii) the cost of Capital Expenditures permitted to have been made
by Cantel Medical and its domestic Subsidiaries under SECTION 8.05 of this Loan
Agreement and which were actually made during such test period, PLUS (iv)
Restricted Junior Payments paid by Cantel Medical and its domestic Subsidiaries
during such test period (which are permitted under SECTION 7.04 of this Loan
Agreement), PLUS (v) all charges against income of Cantel Medical and its
domestic Subsidiaries for foreign, federal, state and local taxes paid for such
test period, all as calculated in accordance with Generally Accepted Accounting
Principles and PLUS (vi) all voluntary prepayments of principal made on all
Consolidated Debt of Cantel Medical and its domestic Subsidiaries during such
test period.
"FDIC" shall mean the Federal Deposit Insurance Corporation or any
successor thereto.
"F/X LINE OF CREDIT FACILITY" shall have the meaning assigned and ascribed
to such term
as set forth in the second recital of this Loan Agreement.
"F/X LINE OF CREDIT MATURITY DATE" shall mean the earlier to occur of (i)
February 22, 2004 or (ii) the date of termination of the F/X Line of Credit
Facility pursuant to SECTION 9.02 of this Loan Agreement.
"F/X LINE OF CREDIT AGGREGATE MAXIMUM AMOUNT" shall mean an aggregate
amount, based upon the face amount of such Foreign Exchange Contracts, of up to
Fifteen Million and 00/100 (US$15,000,000.00) Dollars, as such amount may be
reduced and/or terminated pursuant to the terms, conditions and provisions of
this Loan Agreement.
"FEDERAL FUNDS EFFECTIVE RATE" for any day shall mean the rate per annum
(rounded upward to the nearest 1/100 of 1%) determined by the Administrative
Agent (which determination shall be conclusive, if made in good faith, absent
manifest error) to be the rate per annum announced by the Federal Reserve Bank
of New York on such day as being the weighted average of the rates on overnight
Federal funds transactions arranged by Federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; PROVIDED THAT if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.
"FEDERAL RESERVE BOARD" shall mean the Board of Governors of the Federal
Reserve System or any governmental authority succeeding to its functions.
"FINANCIAL PROVISIONS" shall have the meaning assigned and ascribed to
such term as set forth in SECTION 1.03(iv) of this Loan Agreement.
"FISCAL QUARTER" shall mean the following three month periods of each
Fiscal Year:
BEGINNING ON: ENDING ON:
------------ ---------
August 1 - October 31
November 1 - January 31
February 1 - April 30
May 1 - July 31
"FISCAL YEAR" shall mean that period commencing on August 1 and ending on
July 31 of each succeeding year or such other period as the Borrowers may
designate and the Administrative Agent may approve in writing.
"FOREIGN EXCHANGE CONTRACTS" shall mean those contracts purchased or
provided by
Summit Bank and Mellon US for the Canadian Borrower for the future delivery of
foreign currencies in various markets to cover Inventory purchases and other
ordinary business purchases of assets and services (e.g., legal expenses paid by
the Canadian Borrower in the United States of America) by the Canadian Borrower.
"FUNDING SEGMENT" and "FUNDING SEGMENTS" shall mean with respect to an
Eurodollar Rate Loan, the entire principal amount of such Eurodollar Portion to
which, at the time in question, there is applicable a particular Eurodollar
Interest Period beginning on a particular day and ending on a particular day.
(By definition, each such Eurodollar Portion is at all times composed of an
integral number of discrete Funding Segments and the sum of the principal
amounts of all Funding Segments of any such Portion at any time equals the
principal amount of such Portion at such time.)
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" shall mean generally accepted
accounting principles in the United States of America, as in effect from time to
time, as developed, modified and set forth in the opinions and pronouncements of
the Accounting Principles Board, the American Institute of Certified Public
Accountants and the Financial Accounting Standards Board, or in such other
statements by such other Person as may be in general use by significant segments
of the accounting profession, which are applicable to the circumstances as of
the date of determination, subject to the terms of SECTION 1.03 of this Loan
Agreement.
"GOVERNMENTAL ACTION" or "GOVERNMENTAL APPROVALS" shall mean any approval,
order, consent, authorization, certificate, license, permit or validation of, or
exemption or other action by, or filing, recording or registration with or
notice to, any Governmental Authority.
"GOVERNMENTAL ACTS" shall have the meaning ascribed and assigned to such
term as set forth in SECTION 2.01(vii)(a) of this Loan Agreement.
"GOVERNMENTAL AUTHORITY" shall mean any nation, federal government,
provincial government, state government, local government or political
subdivision thereof (whether state, provincial or otherwise) or any agency,
authority, bureau, central bank, commission, department or instrumentality
thereof, or any court, tribunal, grand jury or arbitrator, in each case whether
foreign or domestic, including, without limitation, any of the foregoing located
in the United States of America and/or Canada.
"INDEMNIFIED MATTERS" shall have the meaning ascribed and assigned to such
term as set forth in SECTION 11.04 of this Loan Agreement
"INDEMNIFIED PARTY" and "INDEMNIFIED PARTIES" shall mean the
Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent,
each Lender and the directors, officers, trustees, employees, agents, attorneys
and controlling shareholders of the Administrative Agent, the US Collateral
Agent, the Canadian Collateral Agent and each Lender.
"INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT" shall mean Ernst & Young LLP,
and its successors and any other independent certified public accounting firm
selected by the Borrowers and their Subsidiaries, which accounting firm is
reasonably satisfactory to the Administrative Agent and the Requisite Lenders
including, without limitation, any one of the Big Five Accounting Firms.
"INVENTORY" shall mean all "inventory", as such term is defined in (i) the
Uniform Commercial Code for each State in the United States in which the
Borrowers and their Subsidiaries may now or hereafter have such inventory
located and (ii) the Personal Property Security Act for each Province in Canada
in which the Borrowers and their Subsidiaries may now or hereafter have such
inventory located, whether now owned and hereafter acquired by the Borrowers
and/or their Subsidiaries, and shall also mean and include all inventory,
wherever located (whether in possession of the Borrowers and/or their
Subsidiaries or of a bailee or other Person), now owned or hereafter acquired by
any of the Borrowers and/or their Subsidiaries or in which any of the Borrowers
and/or their Subsidiaries has or hereafter may acquire any rights, title or
interests including, without limitation, all goods, materials, supplies,
merchandise and other personal property furnished under any contract of service
or intended for sale or lease, including, without limitation, all raw materials,
work in process, finished goods and materials, parts and supplies of any kind,
nature or description which are used or consumed in any of the Borrowers' and/or
their Subsidiaries' respective businesses, all returned or repossessed goods
now, or at any time or times hereafter, in the possession or under the control
of any of the Borrowers and/or their Subsidiaries, and all documents of title or
documents representing the same, but excluding all goods not owned by the
Borrowers and/or their Subsidiaries which have been consigned by any of the
Borrowers and/or their Subsidiaries to the extent included in the foregoing
(together with all proceeds and products thereof).
"IRS" shall mean the Internal Revenue Service and any Person succeeding to
the functions thereof.
"ISSUING BANK" and "ISSUING BANKS" shall mean (individually or
collectively, as the context requires) any one or more of (i) Summit Bank and
its successors, with respect to the issuance of US Letters of Credit and (ii)
Mellon Canada and its successors, with respect to the issuance of Canadian
Letters of Credit.
"LANDLORD SUBORDINATION AND WAIVER AGREEMENT" shall mean a landlord
subordination and waiver agreement in substantially the form as (i) with respect
to the locations of the US Collateral, EXHIBIT "E-1" and (ii) with respect to
the locations of the Canadian Collateral, EXHIBIT "E-2", both attached hereto
and made a part hereof, with all requisite blanks appropriately filled in and
completed.
"LAW" or "LAWS" shall mean any law (including common law), constitution,
statute, treaty, convention, regulation, rule, ordinance, order, injunction,
writ, decree or award of any Governmental Authority, including, without
limitation, the United States of America and
Canada.
"LENDER" and "LENDERS" shall mean a reference to (i) all US Lenders, (ii)
all Canadian Lenders and (iii) each financial or banking institution that has
purchased and/or acquired, by way of assignment or participation, a portion of
any US Lender's or Canadian Lender's rights and interests under this Loan
Agreement, subject to the terms and conditions of SECTION 11.02 of this Loan
Agreement.
"LETTER OF CREDIT" and "LETTERS OF CREDIT" shall mean a collective
reference to (i) all US Letters of Credit and (ii) all Canadian Letters of
Credit.
"LETTERS OF CREDIT REIMBURSEMENT AGREEMENT" shall mean, with respect to
any Letter of Credit, such form of application therefor and form of continuing
Letters of Credit Reimbursement Agreement therefor (in the form of a single
document), as an Issuing Bank may employ in the ordinary course of business for
its own account, all as more fully set forth in EXHIBIT "F" attached hereto and
made a part hereof.
"LEVERAGE MATRIX" shall mean the following matrix, upon which (i) the
applicable interest rates described in SECTION 2.05 hereof, (ii) the applicable
BA Margin described in SECTION 2.06 hereof, (iii) certain fees described in
SECTION 2.07 hereof and (iv) certain other amounts are determined on the basis
of the Consolidated Funded Debt Leverage Ratio of Cantel Medical and its
Subsidiaries:
Consolidated Euro Base Unused Letter of Mandatory
Funded Debt dollar Rate Commitment Credit Prepayment BA
Leverage Ratio* Spread Spread Fee Rate Annual Fee Percentage Margin
--------------- ------ ------ -------- ---------- ---------- ------
equal to or
I less than 1.5 2.0% 0.25% 0.375% 2.0% 0% 2.0%
II greater than
1.5 but less
than or equal
to 2.0 2.5% 0.5% 0.5% 2.5% 25% 2.5%
III greater than
2.0 but less
than or equal
to 2.5 3.0% 0.75% 0.625% 2.75% 50% 2.75%
IV greater than 2.5 ** ** ** ** 50% **
* For purposes of this Leverage Matrix, the Consolidated Funded Debt
Leverage
Ratio used in this Leverage Matrix shall be the Consolidated Funded Debt
Leverage of Cantel Medical and its Subsidiaries. For the period from the
Closing Date up through and including the date upon which the first
Officer's Certificate is received by the Administrative Agent pursuant to
the terms, conditions and provisions of SECTION 5.02(iv) of this Loan
Agreement, all amounts determined by or under the Leverage Matrix shall be
deemed to be the amounts described at Level I on the Leverage Matrix.
Thereafter, such amounts shall be set and established based upon the
Consolidated Funded Debt Leverage Ratio of Cantel Medical and its
Subsidiaries tested in accordance with the terms, conditions and
provisions set forth in SECTION 8.02 hereof.
Any adjustment to the interest rates as a result of a change to the
Consolidated Funded Debt Leverage Ratio of Cantel Medical and its
Subsidiaries shall take effect in accordance with the terms, conditions
and provisions of SECTION 2.05(i)(c) of this Loan Agreement.
** Notwithstanding any term, condition or provision of this Loan Agreement
to the contrary, in the event the Consolidated Funded Debt Leverage Ratio
of Cantel Medical and its Subsidiaries is greater than 2.5 -to- 1.0, (a)
the interest rate for all Loans shall be the Default Rate, (b) the Unused
Commitment Fee Rate shall be equal to two hundred basis points (2.0%)
above the applicable nondefault Unused Commitment Fee Rate then in effect,
(c) the Letter of Credit Annual Fee shall be equal to two hundred basis
points (2.0%) above the applicable nondefault Letter of Credit Annual Fee
rate then in effect and (d) the BA Margin shall be equal to two hundred
basis points (2.0%) above the applicable nondefault BA Margin then in
effect.
"LIABILITIES AND COSTS" shall mean all liabilities, obligations,
responsibilities, losses, damages, punitive damages, consequential damages,
treble damages, costs and expenses (including, without limitation, attorneys',
experts and consulting fees and costs of investigation and feasibility studies),
fines, penalties and monetary sanctions, interest, direct or indirect, known or
unknown, absolute or contingent, past, present or future, arising out of or
relating to any actions, suit, proceeding or resolution or settlement thereof.
"LIEN" shall mean any mortgage, charge, deed of trust, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
otherwise) or preference, priority, security interest, or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement, any
financing lease involving substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the Uniform Commercial
Code, the Personal Property Security Act (Ontario) or comparable law of any
jurisdiction).
"LOAN ACCOUNT" shall have the meaning ascribed and assigned to such term
as set forth in SECTION 2.09(V) of this Loan Agreement.
"LOAN AGREEMENT" shall have the meaning ascribed and assigned to such term
as set forth in the preamble of this Loan Agreement.
"LOAN DOCUMENTS" shall mean any and all agreements, documents,
certificates and instruments executed by any one or more of the Borrowers, the
Corporate Guarantor and/or any other Person and delivered by them to any of the
Lenders, the Administrative Agent, the US Collateral Agent and/or the Canadian
Collateral Agent pursuant to and in connection with the Loan Facilities,
including, without limitation, this Loan Agreement, the Notes, the Agreements of
Guaranty, the Collateral Documents and the Master Agreement, in each case as
amended, supplemented, restated or otherwise modified from time to time in
accordance with the provisions thereof.
"LOAN FACILITIES" shall have the meaning ascribed and assigned to such
term as set forth in the third recital of this Loan Agreement.
"LOANS" shall mean a collective reference to any and all Revolving Credit
Loans and all Acquisition/Term Loans outstanding from time to time.
"MANDATORY PREPAYMENT PERCENTAGE" shall have the meaning assigned and
ascribed to such term as set forth in the Leverage Matrix.
"MARGIN STOCK" shall have the meaning ascribed and assigned to such term
in Regulation U.
"MASTER AGREEMENT" shall mean that certain ISDA Master Agreement entered
into by and among the US Borrowers and the Administrative Agent subsequent to
the Closing Date, in form and substance substantially similar to EXHIBIT "J"
attached hereto and made a part hereof, as such form may be revised, amended
and/or modified from time to time, including without limitation, all schedules,
confirmations and other documents exchanged between the parties thereto in
connection with confirming the transactions thereunder, pursuant to which the US
Borrowers and the Administrative Agent may from time to time hereafter enter
into certain transactions for the purposes of mitigating the interest rate risk
in connection with the Acquisition/Term Loan Facility.
"MATERIAL ADVERSE CHANGE" shall mean any one or more circumstances or
events which, individually or collectively, could reasonably be expected to
result in or to have a Material Adverse Effect.
"MATERIAL ADVERSE EFFECT" shall mean (i) a material adverse effect upon
the business, financial condition, financial performance, properties or
operations of any one or more of the Borrowers and their Subsidiaries taken as a
whole, (ii) a material adverse effect upon the ability of the Borrowers and/or
their Subsidiaries to perform their Obligations under the Loan Documents or
(iii) a material impairment of the ability of any of the Agents and/or the
Lenders to
enforce the Obligations or to make use of any of the remedies available to any
of the Agents and/or the Lenders under the terms, conditions and provisions of
this Loan Agreement or any of the other Loan Documents. For the purposes of the
definition of "Material Adverse Effect", a Material Adverse Effect shall
include, without limitation, the termination or substantial reduction in the
dollar amount of either of the Olympus Agreements.
"MAXIMUM AMOUNT OF CANADIAN REVOLVING CREDIT LOANS" shall mean, with
respect to the Canadian Revolving Credit Loan Facility, as of any date of
determination, the lesser of (i) US$5,000,000.00 or (ii) the difference between
(a) the available Advance Limit (as determined by the calculations set forth in
a current Borrowing Base Certificate) as of such date of determination MINUS (b)
the Dollar Equivalent of the aggregate amount of the Canadian Letter of Credit
Obligations outstanding as of such date of determination.
"MAXIMUM AMOUNT OF US REVOLVING CREDIT LOANS" shall mean, with respect to
the US Revolving Credit Loan Facility, as of any date of determination, the
lesser of (i) US$2,500,000.00 or (ii) the difference between (a) the available
Advance Limit (as determined by the calculations set forth in a current
Borrowing Base Certificate) as of such date of determination MINUS (b) the
aggregate amount of the US Letter of Credit Obligations outstanding as of such
date of determination.
"MAXIMUM CANADIAN EXPOSURE" shall have the meaning ascribed and assigned
to such term as set forth in SECTION 2.15(iii) of this Loan Agreement.
"MULTIEMPLOYER PLAN" shall mean an employee benefit plan defined in
Section 4001(a)(3) of ERISA which is, or within the immediately preceding six
(6) years was, contributed to by the Borrowers, their Subsidiaries or an ERISA
Affiliate.
"NOTE" or "NOTES" shall mean the reference to (i) the Revolving Credit
Loan Notes and (ii) the Acquisition/Term Loan Notes, together with any and all
amendments, modifications, extensions, renewals, refinancings, substitutions or
refundings of any thereof, in whole or in part.
"NOTICE OF BORROWING" shall mean with respect to a proposed Borrowing
pursuant to SECTION 2.01(ii), SECTION 2.02(ii) and/or SECTION 2.03(ii) of this
Loan Agreement, a written loan authorization and certificate duly executed by an
Authorized Officer of the applicable Borrowers and delivered to the
Administrative Agent and/or the Canadian Agent, as applicable, in the forms of
EXHIBITS "G-1" AND "G-2" attached hereto and made a part hereof.
"NOTICE OF CONVERSION/CONTINUATION" shall mean, with respect to a proposed
conversion or continuation of a Revolving Credit Loan or an Acquisition/Term
Loan as a Eurodollar Rate Loan or a Base Rate Loan, pursuant to the terms,
conditions and provisions of SECTION 2.05(iii) of this Loan Agreement, a notice
in the form of EXHIBIT "H" attached hereto and made a part hereof.
"OBLIGATIONS" shall mean all present and future indebtedness and other
liabilities of each
of the Borrowers owing to the Administrative Agent, the US Collateral Agent, the
Canadian Collateral Agent, any Lender or any other Person entitled to
indemnification pursuant to SECTION 11.04 hereof, or any of their respective
permitted successors, transferees or assigns, of every type and description,
arising under or in connection with this Loan Agreement or any other Loan
Document, whether or not for the payment of money, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising and however acquired, including,
without limitation, any and all obligations, liabilities, duties and other
responsibilities owed by any Borrower to any Lender in connection with any
interest or currency "swap agreement" (as such term is defined at 11 U.S.C. ss.
101), future, option, collar, cap, hedge, derivative or any other such agreement
providing for the transfer or mitigation of interest risks entered into in
connection with any of the Loan Facilities. The term includes, without
limitation, all US Reimbursement Obligations, Canadian Reimbursement
Obligations, Swap Obligations, any obligations owed by any of the Borrowers to
any Lender in connection with any Foreign Exchange Contracts, all interest,
charges, expenses, fees, attorneys' and/or solicitor's fees and disbursements
and any other sum chargeable to the Borrowers under this Loan Agreement or any
other Loan Document.
"OECD" shall mean the Organization for Economic Cooperation and
Development.
"OFFICER'S CERTIFICATE" shall mean a certificate for the applicable
Borrowers executed by any Authorized Officers of said Borrowers, including,
without limitation, the president, any vice-president, the chief financial
officer, the controller and the treasurer, in the form of EXHIBIT "I" attached
hereto and made a part hereof.
"OLYMPUS AGREEMENTS" shall mean a collective reference to (i) that certain
Distribution Agreement executed by and between Olympus America Inc. and Carsen
Group, dated as of April 1, 1994, as amended and modified by that certain First
Amendment to Distribution Agreement executed by and between Olympus America Inc.
and Carsen Group Inc., dated August 26, 1997, and as further amended and
modified by that certain Second Amendment to Distribution Agreement executed by
and between Olympus America Inc. and Carsen Group Inc., dated October 6, 2000,
as it may be from time to time further amended, modified, extended, renewed,
substituted, replaced and/or otherwise supplemented, and (ii) that certain
Distributor Agreement executed by and between MediVators and Olympus America
Inc. - Endoscope Division, dated August 1, 1999, as it may be from time to time
amended, modified, extended, renewed, substituted, replaced and/or otherwise
supplemented.
"OPERATING LEASE" and "OPERATING LEASES" shall mean, as applied to any
Person, any lease of any property (whether real, personal or mixed) by that
Person as lessee which is not a Capitalized Lease.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any Person
succeeding to any or all of its functions and duties under ERISA.
"PENSION PLAN" shall mean any (i) "employee pension benefit plan" within
the meaning of Section 3(2) of ERISA (other than a Multiemployer Plan) covered
by Title IV of ERISA by reason of Section 4021 of ERISA, of which the Borrowers
or any ERISA Affiliate are or have been within the preceding five years a
"contributing sponsor" within the meaning of Section 4001(a)(13) of ERISA, or
which are or have been within the preceding five years maintained for employees
of the Borrowers or any ERISA Affiliate or (ii) any such plan established under
or pursuant to Applicable Canadian Pension Legislation.
"PERMITS" shall mean any permit, approval, authorization, license,
variance, or permission required from a Governmental Authority under an
applicable Requirement of Law.
"PERMITTED ACQUISITIONS" shall mean any merger, consolidation, joint
venture, partnership or acquisition with or of any Person which complies with
each of the following conditions: (i) said Person must be in the same line of
business or in a complementary line of business as the Borrowers; (ii) all of
the financial covenants set forth in ARTICLE VIII of this Loan Agreement must be
complied with on both a pro forma combined basis for the then current period and
on a projected basis and no other Event of Default or Potential Event of Default
shall exist at the time of, or shall result or be caused by, such merger,
consolidation, joint venture, partnership or acquisition; (iii) one of the
Borrowers must be the surviving Person (or the surviving Person must be a wholly
owned domestic Subsidiary of Cantel Medical); (iv) the Borrowers shall have
first submitted to the Administrative Agent and the Lenders, as soon as
practicable but in any event PRIOR to the execution of a contract, commitment
letter or other similar document having the effect of binding any of the
Borrowers to said merger, consolidation, joint venture, partnership or
acquisition, (a) pro-forma financial statements for the proposed merged,
consolidated and/or to be acquired Person showing the projected financial
condition of said Person as of the last day of the then current Fiscal Year and
as of the last day of the next three (3) subsequent Fiscal Years and (b) any and
all third party and due diligence materials in connection with such proposed
merger, acquisition and/or consolidation requested by the Administrative Agent,
on behalf of the Lenders, including, without limitation and to the extent
available, financial statements for the prior three (3) fiscal years of the
Person being acquired, merged with or consolidated with or into, and the
Administrative Agent and all of the Lenders shall have approved of such
pro-forma financial statements and third party and due diligence materials; (v)
the Borrowers shall furnish to the Administrative Agent and the Lenders a
certified statement of the Borrowers executed by an Authorized Officer of the
Borrowers (a) describing the financial, economic, structural and other details
of the proposed merger, consolidation, joint venture, partnership or
acquisition, all in detail reasonably satisfactory to the Administrative Agent
and the Lenders and (b) stating that said Authorized Officer has reviewed the
terms of all of the material documents to be executed and delivered by any
Person in connection with such merger, consolidation, joint venture, partnership
or acquisition and has made, or caused to be made under his or her supervision,
a review in reasonable detail of the transaction and of the condition, financial
and otherwise, of the Borrowers, taken as a whole, on both a pro forma combined
basis for the then current period and on a projected basis and no Event of
Default or Potential Event of Default will result from such merger,
consolidation, joint venture, partnership or acquisition; (vi)
one hundred percent (100%) of the Lenders must approve, in writing and in
advance, any such merger, consolidation, joint venture, partnership or
acquisition, which approval will not be unreasonably withheld or delayed; (vii)
said Person must be incorporated, formed or otherwise organized under the laws
of the United States of America; (viii) substantially all of the assets of said
Person must be located within the United States of America, as determined by the
Administrative Agent; and (ix) Regulation U must be complied with to the
satisfaction of the Administrative Agent, in its sole and absolute discretion.
"PERMITTED ENCUMBRANCES" shall mean a collective reference to (i) any
Customary Permitted Liens, (ii) any Liens created or contemplated by the Loan
Documents and (iii) any Liens existing on the Closing Date, as described on
SCHEDULE 1.01-D attached hereto and made a part hereto which Liens are
reasonably acceptable to the Lender.
"PERSON" or "PERSONS" shall mean any natural person, employee, general
partnership, limited partnership, limited liability partnership, corporation
(including a business trust), joint stock company, trust, unincorporated
association, joint venture, limited liability company, trust, bank or other
organization, whether or not a legal entity or any other non-governmental
entity, or any Governmental Authority.
"PLAN" shall mean any employee benefit plan within the meaning of Section
3(3) of ERISA (other than a Multiemployer Plan) of which any of the Borrowers or
any ERISA Affiliate are, or within the preceding five years were, an "employer"
as that term is defined in Section 3(5) of ERISA.
"PLEDGE OF STOCK AGREEMENTS" shall mean a collective reference to (i) that
certain Pledge of Stock Agreement #1, dated the date hereof, executed by Cantel
Medical, as pledgor, pledging to the Administrative Agent, for the benefit of
the US Lenders and the Canadian Lenders, one hundred percent (100%) of the
authorized, issued and outstanding voting capital stock of MediVators, (ii) that
certain Pledge of Stock Agreement #2, dated the date hereof, executed by Cantel
Medical, as pledgor, pledging to the Administrative Agent, for the benefit of
the US Lenders and the Canadian Lenders, at least, but not more than, sixty-five
percent (65%) of the authorized, issued and outstanding voting capital stock of
Carsen Group and (iii) any and all pledge of stock agreements, in form and
substance satisfactory to the Administrative Agent in its sole and absolute
discretion, executed, made and/or entered into subsequent to the Closing Date,
including, without limitation, any and all such pledge of stock agreements which
are consummated for the purposes of pledging one hundred percent (100%) of the
authorized, issued and outstanding voting capital stock of any and all domestic
Subsidiaries of the US Borrowers which are acquired or formed by the US
Borrowers after the Closing Date, as such pledge of stock agreements may be from
time to time hereafter amended, modified, extended, renewed, refinanced and/or
supplemented.
"POTENTIAL EVENT OF DEFAULT" shall mean an event, condition or situation
which, with the giving of any required notice and/or the passage of any required
grace or cure periods, or any
combination of the foregoing, would constitute an Event of Default.
"PROCESS AGENT" shall have the meaning ascribed and assigned to such term
as set forth in SECTION 11.18 of this Loan Agreement.
"PROPERTY" and "PROPERTIES" shall mean any real or personal property,
plant, building, facility, structure, underground storage tank, Equipment,
Inventory, Accounts or other assets now or hereafter owned, leased or operated
by any of the Borrowers.
"PRO RATA SHARE" for any Lender shall mean with respect to (i) the US
Revolving Credit Loan Facility, (a) if the US Revolving Credit Commitments are
then in effect, a fraction (expressed as a percentage), the numerator of which
shall be the amount of such Lender's US Revolving Credit Commitment and the
denominator of which shall be the aggregate amount of all of the Lenders' US
Revolving Credit Commitments, as adjusted from time to time to give effect to
any applicable Assignment and Acceptance Agreement and any reduction of the US
Revolving Credit Loan Facility under SECTION 2.01(v) of this Loan Agreement and
(b) if the US Revolving Credit Commitments are not then in effect but there are
Obligations then outstanding in connection with the US Revolving Credit Loan
Facility, a fraction (expressed as a percentage), the numerator of which shall
be the amount of such outstanding Obligations which are payable to such Lender
and the denominator of which shall be the aggregate amount of all of such
outstanding Obligations, (ii) the Canadian Revolving Credit Loan Facility, (a)
if the Canadian Revolving Credit Commitments are then in effect, a fraction
(expressed as a percentage), the numerator of which shall be the amount of such
Lender's Canadian Revolving Credit Commitment and the denominator of which shall
be the aggregate amount of all of the Lenders' Canadian Revolving Credit
Commitments, as adjusted from time to time to give effect to any applicable
Assignment and Acceptance Agreement and any reduction of the Canadian Revolving
Credit Loan Facility under SECTION 2.02(v) of this Loan Agreement and (b) if the
Canadian Revolving Credit Commitments are not then in effect but there are
Obligations then outstanding in connection with the Canadian Revolving Credit
Loan Facility, a fraction (expressed as a percentage), the numerator of which
shall be the amount of such outstanding Obligations which are payable to such
Lender and the denominator of which shall be the aggregate amount of all of such
outstanding Obligations and (iii) the Acquisition/Term Loan Facility, (a) if the
Acquisition/Term Loan Commitments are then in effect, a fraction (expressed as a
percentage), the numerator of which shall be the amount of such Lender's
Acquisition/Term Loan Commitment and the denominator of which shall be the
aggregate amount of all of the Lenders' Acquisition/Term Loan Commitments, as
adjusted from time to time to give effect to any applicable Assignment and
Acceptance Agreement and (b) if the Acquisition/Term Loan Commitments are not
then in effect but there are Obligations then outstanding in connection with the
Acquisition/Term Loan Facility, a fraction (expressed as a percentage), the
numerator of which shall be the amount of such outstanding Obligations which are
payable to such Lender and the denominator of which shall be the aggregate
amount of all of such outstanding Obligations. A US Lender may have a Pro Rata
Share of (a) both the US Revolving Credit Loan Facility and the Acquisition/Term
Loan Facility or (b) either the US Revolving Credit Loan Facility or the
Acquisition/Term Loan Facility, but not of the Canadian Revolving Credit Loan
Facility. A Canadian Lender may ONLY have a Pro Rata Share of the Canadian
Revolving Credit Loan Facility.
"QUALIFIED CANADIAN ACCOUNT RECEIVABLE" and "QUALIFIED CANADIAN ACCOUNTS
RECEIVABLE" shall mean an Account which has been identified by the Canadian
Borrower to the Canadian Collateral Agent in a Borrowing Base Certificate and is
represented by the Canadian Borrower (by its acceptance of Canadian Revolving
Credit Loans and/or Canadian Letters of Credit hereunder) as meeting all of the
following criteria on its origination date (except with respect to clause (xii)
below, in which case the date shall be the date of submission of the Borrowing
Base Certificate for the measurement at the end of the prior month) and
thereafter until collected, and is in all other respects acceptable to the
Canadian Collateral Agent, in its sole and absolute discretion: (i) the Canadian
Borrower is the sole owner of the Account and has not sold, assigned or
otherwise transferred it, and the Account is not subject to any claim, lien or
security interest (other than any Lien granted to the Canadian Collateral Agent
in connection with the Canadian Revolving Credit Loan Facility); (ii) the
Account is bona fide and legally enforceable and owing to the Canadian Borrower
for the sale of goods and performance of services in the ordinary course of the
Canadian Borrower's business and the Account does not require any further act on
the part of the Canadian Borrower to make it owing by the Account debtor, and
the Canadian Borrower has delivered to the Canadian Collateral Agent (if
required by such Agent) invoices, billings, shipping documents and other
documents evidencing the obligation to pay the Account; (iii) the Account does
not represent a conditional sale, consignment or other sale on a basis other
than that of absolute sale, is not evidenced by any note, instrument, chattel
paper or like document; (iv) the account is invoiced for payment promptly on or
about the date Inventory or other goods represented thereby are shipped to the
Account debtor, and said invoice has not remained unpaid more than ninety (90)
days past its due date and not more than one hundred twenty (120) days past its
invoice date; (v) the Account is not subject to any valid defense, offset,
counterclaim, credit, allowance or adjustment except usual and customary prompt
payment discounts, nor has the Account debtor returned the goods or indicated
any dispute or complaint concerning them; (vi) the Canadian Borrower has not
received any notice of, and does not have any knowledge of, any facts which
materially adversely affect the creditworthiness of the applicable Account
debtor, including, without limitation, the customer is not the subject of any
bankruptcy or other insolvency proceeding; (vii) the Account debtor is not (a)
one of the other Borrowers, (b) a Subsidiary of one of the Borrowers, (c) a
director or officer of any of the Borrowers and/or (d) an affiliate of any such
director or officer; (viii) the Account does not represent a contra account;
(ix) the Account is not subject to any unresolved dispute with an Account
debtor; (x) the Account is not with (a) the United States of America or any
department, agency or instrumentality thereof except in those circumstances
where the Canadian Borrower has, with respect to such Account, complied with the
Federal Assignment of Claims Act (31 U.S.C. ss.3727 ET SEQ.) or (b) the federal
government of Canada or any provincial government or any department, agency or
instrumentality thereof; (xi) the Account is not with a customer located in any
State denying creditors access to said State's courts in the absence of a Notice
of Business Activities Report or other similar filing, unless the Canadian
Borrower has either qualified as a foreign corporation authorized to transact
business in such State or has filed a Notice of Business Activities Report or
similar filing with the applicable state agency for the then current year; (xii)
the Account is not with an Account debtor to whom the Canadian Borrower owes any
accounts payable or other form of Consolidated Debt in an amount not to exceed
twenty percent (20%) of such Account; (xiii) the Account is not due from an
Account debtor whose principal place of business is located outside the United
States of America or Canada unless (a) such Account is backed by a letter of
credit issued or confirmed by a bank that is organized under the laws of the
United States of America or a State thereof or the Federal laws of Canada and
has capital and surplus in excess of $1,000,000,000.00 (PROVIDED, HOWEVER, that
such letter of credit shall have been delivered to the Canadian Collateral
Agent, for the benefit of the Canadian Lenders, as additional Collateral under
the Loan Documents, if required by the Canadian Lenders) or such Account is
covered by foreign credit insurance satisfactory to the Canadian Collateral
Agent in its sole and absolute discretion, (b) such Account debtor is, in the
sole judgment of the Canadian Collateral Agent, creditworthy in relation to the
Account owing by such customer to the Canadian Borrower and (c) such Account has
been outstanding not more than ninety (90) days from the original due date
thereof and not more than one hundred twenty (120) days from the original
invoice date thereof; (xiv) the Account is not due from an Account debtor whose
principal place of business and/or chief executive offices are located in the
Province of Quebec, Canada; (xv) such Account otherwise satisfies the
requirements of the Canadian Collateral Agent; (xvi) such Account does not
represent a credit balance which is more than ninety (90) days past its due date
or which is more than one hundred twenty (120) days past its invoice date; and
(xvii) such Account does not represent a "priority payable" or other form of
statutory payment which takes priority over the lien of the Canadian Collateral
Agent in the event of a liquidation of the Canadian Borrower. The Canadian
Collateral Agent shall have the right to request from the Canadian Borrower, at
any time, such information concerning an Account or Accounts as the Canadian
Collateral Agent may require in order to ascertain that the criteria set forth
above in CLAUSES (i) THROUGH (xvii) have been satisfied with respect to such
Account or Accounts. In addition, (a) if fifty (50%) percent or more of the
total balance due on all Accounts of any account debtor fail to satisfy the
requirements described in CLAUSES (i) THROUGH (xvii) above, then ALL Accounts of
said account debtor shall be ineligible and shall not be "Qualified Canadian
Accounts Receivable", (b) if fifty (50%) percent or more of the total balance
due on all Accounts of any account debtor are more than ninety (90) days past
due date or are more than one hundred twenty (120) days past invoice date, then
ALL Accounts of said account debtor shall be ineligible and shall not be
"Qualified Canadian Accounts Receivable", (c) if all Accounts or Accounts
Receivable from any account debtor (EXCLUDING, however, Olympus America Inc.)
represents twenty-five (25%) percent or more of the total balance due on all
Accounts or Accounts Receivable of the Canadian Borrower, then that portion of
the Accounts and Accounts Receivable of said account debtor which exceed
twenty-five (25%) percent or more of the total balance due on all Accounts or
Accounts Receivable of the Canadian Borrower shall be ineligible and shall not
be "Qualified Canadian Accounts Receivable" and (d) volume rebates and
advertising accruals calculated by the Canadian Borrower on a monthly basis
shall be ineligible and shall not be "Qualified Canadian Accounts Receivable".
"QUALIFIED CANADIAN INVENTORY" shall mean the Inventory of the Canadian
Borrower (i) which is in the sole possession or control of the Canadian
Borrower, (ii) which is stored in a location or locations and in a manner
acceptable to the Canadian Collateral Agent, (iii) which is valued at the lower
of cost or market value, (iv) which is, and at all times continues to be,
acceptable to the Canadian Collateral Agent, (v) which is NOT work in process,
(vi) in which the Canadian Collateral Agent has an enforceable perfected
security interest under the applicable Personal Property Security Act, which
Canadian security interest is prior to any and all Liens, except Liens for taxes
not yet due and payable to the extent given priority by statute and prior to any
rights of suppliers in Canada to repossess thirty (30) day goods pursuant to the
Bankruptcy Act, (vii) which is NOT obsolete or unuseable or unsaleable in the
ordinary course of the Canadian Borrower's business, (viii) which is available
for sale in the ordinary course of the Canadian Borrower's business and (ix)
which Inventory is not physically located in the Province of Quebec, Canada.
"QUALIFIED US ACCOUNT RECEIVABLE" and "QUALIFIED US ACCOUNTS RECEIVABLE"
shall mean an Account which has been identified by the US Borrowers to the
Administrative Agent in a Borrowing Base Certificate and is represented by the
US Borrowers (by its acceptance of US Revolving Credit Loans and/or US Letters
of Credit hereunder) as meeting all of the following criteria on its origination
date (except with respect to clause (xii) below, in which case the date shall be
the date of submission of the Borrowing Base Certificate for the measurement
date at the end of the prior month) and thereafter until collected, and is in
all other respects acceptable to the Administrative Agent, in its sole and
absolute discretion: (i) one of the US Borrowers is the sole owner of the
Account and such US Borrower has not sold, assigned or otherwise transferred it,
and the Account is not subject to any claim, lien or security interest (other
than any Lien granted to the US Collateral Agent in connection with the US
Revolving Credit Loan Facility, the Acquisition/Term Loan Facility and the F/X
Line of Credit Loan Facility); (ii) the Account is bona fide and legally
enforceable and owing to one of the US Borrowers for the sale of goods and
performance of services in the ordinary course of such US Borrower's business
and the Account does not require any further act on the part of such US Borrower
to make it owing by the Account debtor, and such US Borrower has delivered to
the Administrative Agent (if required by the Administrative Agent) invoices,
billings, shipping documents and other documents evidencing the obligation to
pay the Account; (iii) the Account does not represent a conditional sale,
consignment or other sale on a basis other than that of absolute sale, is not
evidenced by any note, instrument, chattel paper or like document; (iv) the
account is invoiced for payment promptly on or about the date Inventory or other
goods represented thereby are shipped to the Account debtor, and said invoice
has not remained unpaid more than ninety (90) days past its due date and not
more than one hundred twenty (120) days past its invoice date; (v) the Account
is not subject to any valid defense, offset, counterclaim, credit, allowance or
adjustment except usual and customary prompt payment discounts, nor has the
Account debtor returned the goods or indicated any dispute or complaint
concerning them; (vi) no US Borrower has received any notice of, or has any
knowledge of, any facts which materially adversely affect the creditworthiness
of the applicable Account debtor, including, without limitation, the customer is
not the subject of any bankruptcy or other insolvency proceeding; (vii) the
Account debtor is not (a) one of the other Borrowers, (b) a Subsidiary of one of
the Borrowers, (c) a director or officer of any of the Borrowers and/or (d) an
affiliate of any such director or officer; (viii) the Account does not represent
a contra account; (ix) the Account is not subject to any unresolved dispute with
an Account debtor; (x) the Account is not with (a) the United States of America
or any department, agency or instrumentality thereof except in those
circumstances where the applicable US Borrower has, with respect to such
Account, complied with the Federal Assignment of Claims Act (31 U.S.C. ss.3727
ET SEQ.) or (b) the federal government of Canada or any provincial government or
any department, agency or instrumentality thereof; (xi) the Account is not with
a customer located in any State denying creditors access to said State's courts
in the absence of a Notice of Business Activities Report or other similar
filing, unless the applicable US Borrower has either qualified as a foreign
corporation authorized to transact business in such State or has filed a Notice
of Business Activities Report or similar filing with the applicable state agency
for the then current year; (xii) the Account is not with an Account debtor to
whom the applicable US Borrower owes any accounts payable or other form of
Consolidated Debt in an amount not to exceed twenty percent (20%) of such
Account; (xiii) the Account is not due from an Account debtor whose principal
place of business is located outside the United States of America or Canada
unless (a) such Account is backed by a letter of credit issued or confirmed by a
bank that is organized under the laws of the United States of America or a State
thereof and has capital and surplus in excess of $1,000,000,000.00 (PROVIDED,
HOWEVER, that such letter of credit shall have been delivered to the US
Collateral Agent, for the benefit of the US Lenders, as additional Collateral
under the Loan Documents if required by the US Lenders holding a US Revolving
Credit Commitment) or such Account is covered by foreign credit insurance
satisfactory to the Administrative Agent in its sole and absolute discretion,
(b) such Account debtor is, in the sole judgment of the Administrative Agent,
creditworthy in relation to the Account owing by such customer to the applicable
US Borrower and (c) such Account has been outstanding not more than ninety (90)
days from the original due date thereof and not more than one hundred twenty
(120) days from the original invoice date thereof; (xiv) the Account is not due
from an Account debtor whose principal place of business and/or chief executive
offices are located in the Province of Quebec, Canada; (xv) such Account
otherwise satisfies the requirements of the Administrative Agent and/or the US
Collateral Agent; (xvi) such Account does not represent a credit balance which
is more than ninety (90) days past its due date or which is more than one
hundred twenty (120) days past its invoice date; and (xvii) such Account does
not represent a "priority payable" or other form of statutory payment which
takes priority over the lien of the US Collateral Agent in the event of a
liquidation of the US Borrowers. The US Collateral Agent shall have the right to
request from the US Borrowers, at any time, such information concerning an
Account or Accounts as the US Collateral Agent may require in order to ascertain
that the criteria set forth above in CLAUSES (i) THROUGH (xvii) have been
satisfied with respect to such Account or Accounts. In addition, (a) if fifty
(50%) percent or more of the total balance due on all Accounts of any account
debtor fail to satisfy the requirements described in CLAUSES (i) THROUGH (xvii)
above, then ALL Accounts of said account debtor shall be ineligible and shall
not be "Qualified US Accounts Receivable", (b) if fifty (50%) percent or more of
the total balance due on all Accounts of any account debtor are more than ninety
(90) days past due date
or are more than one hundred twenty (120) days past invoice date, then ALL
Accounts of said account debtor shall be ineligible and shall not be "Qualified
US Accounts Receivable", (c) if all Accounts or Accounts Receivable from any
account debtor (EXCLUDING, however, Olympus America Inc.) represents twenty-five
(25%) percent or more of the total balance due on all Accounts or Accounts
Receivable of one of the US Borrowers, then that portion of the Accounts and
Accounts Receivable of said account debtor which exceed twenty-five (25%)
percent or more of the total balance due on all Accounts or Accounts Receivable
of such US Borrower shall be ineligible and shall not be "Qualified US Accounts
Receivable" and (d) volume rebates and advertising accruals calculated by the US
Borrowers on a monthly basis shall be ineligible and shall not be "Qualified US
Accounts Receivable".
"QUALIFIED US INVENTORY" shall mean the Inventory of any of the US
Borrowers (i) which is in the sole possession or control of such US Borrower,
(ii) which is stored in a location or locations and in a manner acceptable to
the US Collateral Agent, (iii) which is valued at the lower of cost or market
value, (iv) which is, and at all times continues to be, acceptable to the US
Collateral Agent, (v) which is NOT work in process, unless such work in process
represents endoscope disinfection units for which the primary manufacturing
process has been completed and such units remain unfinished subject only to the
installation of customer options (i.e., heaters, air compressors and leak
testers) and final testing, in which case such work in process will be
considered to have the same collateral status as finished goods inventories;
PROVIDED, HOWEVER, that in no event shall the Dollar amount of such Inventory
permitted to be Qualified US Inventory pursuant to this CLAUSE (v) ever exceed
US$100,000.00 in the aggregate at any one time, (vi) in which the US Collateral
Agent has an enforceable perfected security interest under the applicable
Uniform Commercial Code, which security interest is prior to any and all Liens,
except Liens for taxes not yet due and payable to the extent given priority by
statute, (vii) which is NOT obsolete or unuseable or unsaleable in the ordinary
course of such US Borrower's business and (viii) which is available for sale in
the ordinary course of such US Borrower's business.
"RCRA" shall mean the Resource Conservation and Recovery Act, 42
U.S.C.ss.6901 ET SEQ., and any successor statute, and regulations promulgated
thereunder.
"REFUNDING CANADIAN BANKERS ACCEPTANCE" shall have the meaning ascribed
and assigned to such term as set forth in SECTION 2.06(ii) in this Loan
Agreement.
"REGULATION D" shall mean Regulation D of the Federal Reserve Board, or
any successor statute or regulation thereto, as in effect from time to time.
"REGULATION T" shall mean Regulation T of the Federal Reserve Board, or
any successor statute or regulation thereto, as in effect from time to time.
"REGULATION U" shall mean Regulation U of the Federal Reserve Board, or
any successor statute or regulation thereto, as in effect from time to time.
"REGULATION X" shall mean Regulation X of the Federal Reserve Board, or
any successor statute or regulation thereto, as in effect from time to time.
"RELEASE" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration of
Environmental Concern Materials in violation of Environmental Laws into the
indoor or outdoor Environment or into or out of any Property, including the
movement of Environmental Concern Materials through or in the air, soil, surface
water, groundwater or Property.
"REMEDIAL ACTION" shall mean actions required to (i) clean up, remove,
treat or in any other way address Environmental Concern Materials in the indoor
or outdoor Environment; (ii) prevent the Release or threat of Release or
minimize the further Release of Environmental Concern Materials so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor Environment; or (iii) perform pre-remedial studies and
investigations and post-remedial monitoring and care.
"REPORTABLE EVENT" shall mean any event described as such in Section 4043
of ERISA or regulations promulgated thereunder.
"REQUIREMENTS OF LAW" shall mean, as to any Person, the charter and
by-laws or other organization or governing documents of such Person, and any
law, rule or regulation, Permit, or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject, including, without limitation, the Securities Act, the Securities
Exchange Act, Regulations U and X, and any certificate of occupancy, zoning
ordinance, building, environmental or land use requirement or Permit or
occupational safety or health law, rule or regulation.
"REQUISITE LENDERS" shall mean, as of any date of determination, (i) if
the Commitments are then in effect, Lenders having Pro Rata Shares which are, in
the aggregate, sixty-six and two-thirds percent (66.67%) or more of the then
aggregate amount of the Commitments then in effect and (ii) if the Commitments
are not then in effect but there are Obligations outstanding, Lenders holding,
in the aggregate, sixty-six and two-thirds (66.67%) or more of the outstanding
Obligations.
"RESET DATE" shall have the meaning ascribed and assigned to such term as
set forth in SECTION 2.15(i) of this Loan Agreement.
"RESTRICTED JUNIOR PAYMENTS" shall mean (i) any cash dividend or other
distribution to the shareholders of any of the Borrowers (whether direct or
indirect and whether in cash, property, Securities or otherwise) on account of
any shares of any class of capital stock of any of the Borrowers, now or
hereafter outstanding, (ii) any scheduled payment of principal of, premium, if
any, or interest on, or fees in respect of, redemption, conversion, exchange,
purchase, retirement,
defeasance, sinking fund or similar payment with respect to any Consolidated
Subordinated Debt of any of the Borrowers after the occurrence of an Event of
Default and (iii) any prepayment in advance of anticipated and scheduled payment
dates of principal of, premium, if any, or interest on, or fees in respect of,
redemption, conversion, exchange, purchase, retirement, defeasance, sinking fund
or similar payment with respect to any Consolidated Subordinated Debt of any of
the Borrowers (except for prepayments in connection with the refinance of such
Consolidated Subordinated Debt in amounts and on terms and conditions equal to
or better than the existing terms and conditions).
"REVOLVING CREDIT COMMITMENT" and "REVOLVING CREDIT COMMITMENTS" shall
mean a collective reference to (i) all US Revolving Credit Commitments and (ii)
all Canadian Revolving Credit Commitments.
"REVOLVING CREDIT LOAN" and "REVOLVING CREDIT LOANS" shall mean a
collective reference to (i) all US Revolving Credit Loans and (ii) all Canadian
Revolving Credit Loans.
"REVOLVING CREDIT LOAN FACILITIES" shall mean a collective reference to
(i) the US Revolving Credit Loan Facility and (ii) the Canadian Revolving Credit
Loan Facility.
"SECURITY" and "SECURITIES" shall mean any stock, shares, voting trust
certificates, bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, and in general any
instruments commonly known as "securities", or any certificates of interest,
shares, or participations in temporary or interim certificates for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, but shall not include any evidence of the Obligations.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended to the
date hereof and from time to time hereafter, and any successor statute.
"SECURITIES EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended to the date hereof from time to time hereafter, and any successor
statute.
"SECURITY AGREEMENT" and "SECURITY AGREEMENTS" shall mean a collective
reference to (i) the Security Agreement #1, (ii) the Security Agreement #2,
(iii) any and all other security agreements, in form and substance satisfactory
to the US Collateral Agent in its sole and absolute discretion, executed, made
and/or entered into subsequent to the Closing Date for the purposes of
assigning, hypothecating, pledging, conveying, transferring, giving and granting
to the US Collateral Agent, for the benefit of the US Lenders, a continuing
security interest in all of the rights, title and interests of any domestic
Subsidiary of the US Borrowers in and to all present and future assets and
properties and undertakings of said domestic Subsidiary described in such
security agreement (including, without limitation, Accounts, Inventory and
Equipment), as provided for in and required by SECTION 6.12 of this Loan
Agreement and (iv) any and all other security agreements, in form and substance
satisfactory to the Canadian Collateral Agent in its
sole and absolute discretion, executed, made and/or entered into subsequent to
the Closing Date for the purposes of assigning, hypothecating, pledging,
conveying, transferring, giving and granting to the Canadian Collateral Agent,
for the benefit of all of the Canadian Lenders, a continuing security interest
in all of the rights, title and interests of any domestic Subsidiary of the US
Borrowers in and to all present and future assets and properties and
undertakings of said domestic Subsidiary described in such security agreement
(including, without limitation, Accounts, Inventory and Equipment), as provided
for in and required by SECTION 6.12 of this Loan Agreement, as each of such
security agreements may be from time to time hereafter amended, modified,
extended, renewed, refinanced and/or supplemented.
"SECURITY AGREEMENT #1" shall mean that certain Security Agreement #1
dated of even date herewith whereby the US Borrowers have collaterally assigned,
hypothecated, pledged, conveyed, transferred, given and granted to the US
Collateral Agent, for the benefit of the US Lenders and the Canadian Lenders, a
continuing security interest in their respective rights, title and interests in
and to all present and future assets and properties and undertakings of the US
Borrowers described therein (including, without limitation, Accounts, Inventory
and Equipment), as additional collateral security for the US Revolving Credit
Loan Facility, the Acquisition/Term Loan Facility and their obligations under
and in connection with the Agreement of Guaranty #1 and the Agreement of
Guaranty #2, as said Security Agreement #1 may be from time to time hereafter
amended, modified, extended, refinanced or supplemented.
"SECURITY AGREEMENT #2" shall mean that certain Security Agreement #2
dated of even date herewith whereby Carsen Group has collaterally assigned,
hypothecated, pledged, conveyed, transferred, given and granted to the Canadian
Collateral Agent, for the benefit of the Canadian Lenders, a continuing security
interest in its rights, title and interests in and to all present and future
assets and properties and undertakings of Carsen Group described therein
(including, without limitation, Accounts, Inventory and Equipment), as said
Security Agreement #2 may be from time to time hereafter amended, modified,
extended, refinanced or supplemented.
"SENIOR FINANCIAL OFFICER" shall mean the chief financial officer of the
Borrowers designated by the Borrowers in a written statement delivered to the
Administrative Agent.
"SINGLE EMPLOYER PLAN" shall mean any Plan which is not a Multiemployer
Plan under ERISA.
"SOLVENT" shall mean, with respect to any Person, that at the time of
determination:
(i) the fair value of its assets (both at fair valuation and at
present fair salable value) is in excess of the total amount of its liabilities,
including, without limitation, contingent, subordinated, unmatured and/or
unliquidated liabilities; and
(ii) it is then able to pay its Consolidated Debts as they mature;
and
(iii) it owns property having a value (both at fair valuation and at
present fair salable value) in excess of the total amount required to pay all of
its Consolidated Debt.
"STATE" or "STATES" shall mean any one or more of the states comprising a
portion of the United States of America.
"STOCK REPURCHASE PROGRAM" shall mean a reference to any stock repurchase
program approved and entered into by Cantel Medical involving Cantel Medical's
repurchase of shares of its outstanding Common Shares.
"SUBSEQUENT FUNDING" shall have the meaning assigned and ascribed to such
term as set forth in SECTION 4.02 of this Loan Agreement.
"SUBSIDIARY" or "SUBSIDIARIES" shall mean, with respect to any Person, (i)
a corporation a majority of whose capital stock with voting power, under
ordinary circumstances, to elect a majority of directors is at the time,
directly or indirectly, owned by such Person, by such Person and one or more
other Subsidiaries of such Person or by one or more Subsidiaries of such Person,
(ii) any other Person (other than a corporation) in which such first Person and
one or more Subsidiaries of such first Person, directly or indirectly, at the
date of determination thereof has at least majority ownership interest and/or
(iii) any entity whose net earnings (losses) or portions thereof would be
properly included and consolidated with the net earnings of such Person in
accordance with Generally Accepted Accounting Principles; PROVIDED, HOWEVER,
that the term "Subsidiary" shall not include any entity that is not reflected on
the consolidated balance sheet of a Person due to inactivity and lack of
material assets and liabilities.
"SWAP OBLIGATION" and "SWAP OBLIGATIONS" shall mean the US Borrowers'
obligations to any Person (that is or was a Lender or an affiliate of a Lender
at the time of entering into the Master Agreement) arising from time to time
under the Master Agreement, including any and all payment or reimbursement
obligations of whatever nature.
"TAXES" shall have the meaning ascribed and assigned to such term as set
forth in SECTION 2.13(i) of this Loan Agreement.
"TERMINATION EVENT" shall mean (i) any Reportable Event with respect to
any Benefit Plan, (ii) the withdrawal of the Borrowers, or an ERISA Affiliate
from a Benefit Plan during a plan year in which it was a "substantial employer"
as defined in Section 4001(a)(2) of ERISA, (iii) the notification by any of the
Borrowers or an ERISA Affiliate to affected parties of an intent to terminate a
Benefit Plan in a distress termination described in Section 4041(c) of ERISA,
(iv) the institution by the PBGC of proceedings to terminate any Benefit Plan,
(v) any event or condition which constitutes grounds under Section 4042 of ERISA
for the appointment of a trustee to administer a Benefit Plan, (vi) the partial
or complete withdrawal of the Borrowers or any ERISA Affiliate from a
Multiemployer Plan or (vii) any applicable withdrawal or termination under
Applicable Canadian Pension Legislation.
"UNIFORM CUSTOMS" shall mean, as determined by the applicable Issuing Bank
in its sole and absolute discretion, a reference to either (i) the Uniform
Customs and Practice for Documentary Credits (1993 Revisions), International
Chamber of Commerce Publication No. 500, as the same may be amended from time to
time or (ii) the International Standby Practices 1998, International Chamber of
Commerce Publication No. 590, and any subsequent official revision thereof.
"UNUSED COMMITMENT FEE RATE" shall mean, as of each date of determination
during the term of the Loan Facilities, the applicable percentage set forth in
the Leverage Matrix opposite the Consolidated Funded Debt Leverage Ratio
(determined as of the last day of the prior Fiscal Quarter).
"US BORROWER" and "US BORROWERS" shall mean a reference to one or more of
(i) Cantel Medical, (ii) MediVators and/or (iii) any domestic Subsidiaries of
Cantel Medical which are purchased, acquired or created after the Closing Date
and during the term of the Loan Facilities and which are required (a) to
undertake, on a JOINT AND SEVERAL BASIS with the other US Borrowers, the
Obligations of the US Borrowers pursuant to the terms, conditions and provisions
of this Loan Agreement, (b) to cause one hundred percent (100%) of their
authorized, issued and outstanding voting capital stock to be pledged by Cantel
Medical as additional collateral security for the obligations of Cantel Medical
under this Loan Agreement and (c) to pledge all of their respective personal
property assets as additional collateral security for their respective
obligations under this Loan Agreement, all as provided for in and required by
SECTION 6.12 of this Loan Agreement.
"US COLLATERAL" shall mean all of the Collateral which is now or hereafter
located in the United States of America.
"US COLLATERAL AGENT" shall have the meaning assigned and ascribed to such
term as set forth in the preamble of this Loan Agreement.
"US COMMITMENT" and "US COMMITMENTS" shall mean the aggregate of each US
Lender's US Revolving Credit Commitment and Acquisition/Term Loan Commitment (if
any).
"US DOLLAR", "US DOLLARS" and the symbol "US$" shall mean lawful money of
the United States of America.
"US LENDER" and "US LENDERS" shall mean a collective reference to (i)
Summit Bank, (ii) Mellon US and (iii) any other Lender holding a US Revolving
Credit Commitment and/or an Acquisition/Term Loan Commitment.
"US LETTER OF CREDIT" and "US LETTERS OF CREDIT" shall mean a reference to
any sight commercial/documentary or standby letter of credit issued for the
account of Cantel Medical
and/or MediVators by an Issuing Bank pursuant to SECTION 2.01(vi) of this Loan
Agreement and denominated in US Dollars.
"US LETTER OF CREDIT OBLIGATIONS" shall mean, at any time, the sum of (i)
US Reimbursement Obligations at such time for US Letters of Credit and (ii) the
Dollar Equivalent of the aggregate maximum amount then available for drawing
under the outstanding US Letters of Credit.
"US LETTER OF CREDIT SUBLIMIT" shall mean, as of any date of
determination, the lesser of (i) the difference between (a) the Advance Limit
with respect to the US Revolving Credit Loan Facility as of such date of
determination, MINUS (b) the aggregate outstanding principal amount of all US
Revolving Credit Loans as of such date of determination or (ii) the difference
between (a) US$500,000.00 MINUS (b) the aggregate outstanding principal amount
of all US Revolving Credit Loans in excess of US$2,000,000.00 as of such date of
determination.
"US REIMBURSEMENT OBLIGATIONS" shall mean the Dollar Equivalent of the
unpaid reimbursement or repayment obligations of the US Borrowers to all Issuing
Banks pursuant to all Letter of Credit Reimbursement Agreements for amounts paid
out under US Letters of Credit.
"US REVOLVING CREDIT ACCOMMODATIONS" shall mean, at any time, the sum of
(i) all US Revolving Credit Loans outstanding at such time and (ii) all US
Letter of Credit Obligations outstanding at such time.
"US REVOLVING CREDIT COMMITMENT" shall mean, with respect to each Lender,
as of any date of determination, such Lender's Pro Rata Share of the amount of
the US Revolving Credit Loan Facility as of such date which percentage and
amount shall be set forth on the signature pages to this Loan Agreement and/or
in any Assignment and Acceptance Agreement.
"US REVOLVING CREDIT COMMITMENTS" shall mean, as of any date of
determination, collectively, the aggregate amount of each US Revolving Credit
Commitment of all of the US Lenders as of such date.
"US REVOLVING CREDIT LOAN" and "US REVOLVING CREDIT LOANS" shall have the
meaning ascribed and assigned to such term in SECTION 2.01(i)(a) of this Loan
Agreement.
"US REVOLVING CREDIT LOAN FACILITY" shall have the meaning ascribed and
assigned to such term in the second recital of this Loan Agreement.
"US REVOLVING CREDIT LOAN NOTE" or "US REVOLVING CREDIT LOAN NOTES" shall
mean those Revolving Credit Loan Notes in substantially the form attached hereto
as EXHIBIT "K" with all requisite blanks appropriately filled, each such note
payable to the order of a US Lender, in a face amount equal to such US Lender's
Pro Rata Share of the US Revolving Credit Commitments.
"US REVOLVING CREDIT TERMINATION DATE" shall mean the earliest to occur of
(i) February 22, 2004, (ii) the date of the permanent termination of the US
Revolving Credit Commitments pursuant to SECTION 2.01(v) of this Loan Agreement
or (iii) the date of termination of the US Revolving Credit Commitments pursuant
to SECTION 9.02 of this Loan Agreement.
SECTION 1.02 RULES OF INTERPRETATION AND CONSTRUCTION. In this Loan
Agreement unless the context otherwise clearly requires:
(i) Articles and Sections mentioned by number only are the
respective Articles and Sections of this Loan Agreement as so numbered;
(ii) Words importing a particular gender mean and include every
other gender, and words importing the singular number mean and include the
plural number and vice versa;
(iii) Words importing persons mean and include firms, associations,
partnerships (including limited partnerships), societies, trusts, corporations
or other legal entities, including public or governmental bodies, as well as
natural persons;
(iv) Any headings preceding the texts of the several Articles and
Sections of this Loan Agreement, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference and
shall not affect or control the meaning, construction or interpretation of this
Loan Agreement;
(v) If any clause, provision or section of this Loan Agreement shall
be ruled invalid or unenforceable by any court of competent jurisdiction, such
holding shall not invalidate or render unenforceable any of the remaining
provisions thereof, unless not invalidating or rendering unenforceable the
remaining provisions shall be inequitable;
(vi) The terms "herein", "hereunder", "hereby", "hereto", "hereof"
and any similar terms as used in this Loan Agreement refer to this Loan
Agreement as a whole and not to any particular provision of this Loan Agreement;
the term "heretofore" means before the date of execution of this Loan Agreement;
and the term "hereafter" means on or after the date of execution of this Loan
Agreement;
(vii) This Loan Agreement and all matters relating hereto shall be
governed by and construed and interpreted in accordance with the laws of the
State of New Jersey;
(viii) If any clause, provision or section of this Loan Agreement
shall be determined to be apparently contrary to or conflicting with any other
clause, provision or section of this Loan Agreement, then the clause, provision
or section containing the more specific provisions shall control and govern with
respect to such apparent conflict;
(ix) References in this Loan Agreement to "determination" (and
similar terms) by the Administrative Agent or by any Lender include good faith
estimates by the Administrative Agent or by any Lender (in the case of
quantitative determinations) and good faith beliefs by the Administrative Agent
or by any Lender (in the case of qualitative determinations); and
(x) Any reference to the symbol "$" when used herein, shall be
construed to mean and refer to dollars denominated in the currency of the United
States, unless the context clearly indicates otherwise.
SECTION 1.03 ACCOUNTING PRINCIPLES.
(i) As used in this Loan Agreement "Generally Accepted Accounting
Principles" shall be established on the date a relevant computation or
determination is to be made or the date of relevant financial statements, as the
case may be.
(ii) Except as otherwise provided in this Loan Agreement, all
computations and determinations as to accounting or financial matters shall be
made, and all financial statements to be delivered pursuant to this Loan
Agreement shall be prepared, in accordance with Generally Accepted Accounting
Principles (including principles of consolidation where appropriate), and all
accounting or financial terms shall have the meanings ascribed to such terms by
Generally Accepted Accounting Principles.
(iii) If any change in Generally Accepted Accounting Principles
after the date of this Loan Agreement is or shall be required to be applied to
transactions then or thereafter in existence, and a violation of one or more
provisions of this Loan Agreement shall have occurred or in the opinion of the
Borrowers would likely occur which would not have occurred or be likely to occur
if no change in accounting principles had taken place, (a) the Borrowers and the
Administrative Agent agree that such violation shall not be considered to
constitute an Event of Default or a Potential Event of Default for a period of
thirty (30) days from the date the Borrowers notify the Administrative Agent and
the Lenders of the applicability of this SECTION 1.03(iii); (b) the Borrowers,
the Administrative Agent and the Lenders agree in such event to negotiate in
good faith an amendment of this Loan Agreement which shall approximate to the
extent possible the economic effect of the original financial covenants after
taking into account such change in Generally Accepted Accounting Principles; and
(c) if the Borrowers, the Administrative Agent and the Lenders are unable to
negotiate such an amendment within the thirty (30) day period described above in
clause (a), the Borrowers shall have the option of (1) prepaying and terminating
the Loan Facilities (pursuant to applicable provisions hereof) or (2) submitting
the drafting of such an amendment to a firm of independent certified public
accountants of nationally recognized standing acceptable to the Borrowers, the
Administrative Agent and the Lenders, which shall complete its draft of such
amendment, which shall be binding upon the parties, within thirty (30) days of
submission. If the Borrowers, the Administrative Agent and the Lenders cannot
agree, the firm shall be selected by binding arbitration in the City
of Hackensack, New Jersey in accordance with the rules of the American
Arbitration Association then in effect. If the Borrowers do not exercise either
such option within said thirty (30) day period, then as used in this Loan
Agreement, "Generally Accepted Accounting Principles" shall mean generally
accepted accounting principles in effect at the relevant date. The Borrowers,
the Administrative Agent and the Lenders agree that if the Borrowers elect the
option in CLAUSE (2) above, until such accounting firm has been selected and
completes drafting such amendment, no such violation shall constitute an Event
of Default or a Potential Event of Default.
(iv) If any change in Generally Accepted Accounting Principles after
the date of this Loan Agreement is required to be applied to transactions or
conditions then or thereafter in existence, and the Administrative Agent shall
assert that the effect of such change is or shall likely be to distort
materially the effect of any of the definitions of financial terms set forth in
ARTICLE I of this Loan Agreement or any of the financial covenants of the
Borrowers set forth in ARTICLE VIII of this Loan Agreement (hereinafter referred
to as the "Financial Provisions"), so that the intended economic effect of any
of the Financial Provisions will not in fact be accomplished, then
(a) the Administrative Agent shall notify the Borrowers of
such assertion, specifying the change in Generally Accepted Accounting
Principles which is objected to, and until otherwise determined as provided
below, the specified change in Generally Accepted Accounting Principles shall
not be made by the Borrowers in their financial statements for the purpose of
applying the Financial Provisions; and
(b) the Administrative Agent and the Borrowers shall follow
the procedures set forth in PARAGRAPH (iii)(b) and PARAGRAPH (iii)(c)
of this SECTION 1.03. If the Administrative Agent, the Borrowers and the Lenders
are unable to agree on an amendment as provided in said PARAGRAPH (iii)(b) and
if the Borrowers does not exercise either option set forth in PARAGRAPH (iii)(c)
of this SECTION 1.03 within the specified time period, then as used in this Loan
Agreement "Generally Accepted Accounting Principles" shall mean generally
accepted accounting principles in effect at the relevant date, except that the
specified change in "Generally Accepted Accounting Principles" which is objected
to by the Administrative Agent shall not be made in applying the Financial
Provisions. The Administrative Agent, the Borrowers and the Lenders agree that
if the Borrowers elect the option in clause (2) of this first sentence of said
PARAGRAPH (iii)(c), until such independent accounting firm has been selected and
completes drafting such amendment, the specified change in "Generally Accepted
Accounting Principles" shall not be made in applying the Financial Provisions.
(v) All expenses of compliance with this SECTION 1.03 shall be paid
for by the Borrowers, except the Borrowers and the Lenders shall be responsible
for their own costs and expenses associated with proceedings under SECTION
1.03(iii)(c) hereof other than the cost and expense payable to the American
Arbitration Association and any such accounting firm which shall be divided
equally between the Administrative Agent and Lenders on the one hand and the
Borrowers on the other.
ARTICLE II
AMOUNTS AND TERMS FOR THE LOAN FACILITIES
SECTION 2.01 US REVOLVING CREDIT LOAN FACILITY.
(i) AVAILABILITY. (a) Subject to the terms and conditions set forth
in this Loan Agreement, and provided no Event of Default or Potential Event of
Default shall have occurred and be continuing, each US Lender hereby SEVERALLY
(AND NOT JOINTLY OR JOINTLY AND SEVERALLY) agrees to make available to and for
the benefit of the US Borrowers from time to time during the period from the
Closing Date to the Business Day next preceding the US Revolving Credit
Termination Date, revolving credit loans (hereinafter each individually referred
to as a "US Revolving Credit Loan" and collectively referred to as the "US
Revolving Credit Loans"), in a principal amount which shall not exceed, in the
aggregate at any time outstanding, such US Lender's US Revolving Credit
Commitment in effect at such time; PROVIDED, HOWEVER, that (1) at no time shall
the aggregate principal amount of all US Revolving Credit Loans outstanding at
any time exceed the Maximum Amount of US Revolving Credit Loans at such time,
(2) at no time shall the aggregate Dollar Equivalent of the outstanding
principal amount of US Letter of Credit Obligations ever exceed the US Letter of
Credit Sublimit at such time and (3) US Revolving Credit Loans shall be (A) made
solely to the US Borrowers, (B) made only by the US Lenders and (C) denominated
solely in US Dollars. The US Revolving Credit Loans may be either Eurodollar
Rate Loans or Base Rate Loans. The US Revolving Credit Loans shall be evidenced
by the US Revolving Credit Loan Notes. Each US Lender is hereby authorized to
record the date and amount of each US Revolving Credit Loan made by said US
Lender and the date and amount of each payment or prepayment of principal
thereof either (1) on the SCHEDULE "1" annexed to and constituting a part of
said US Lender's US Revolving Credit Loan Note or (2) by entering such
information into said US Lender's automated loan tracking system, and any such
recordation shall constitute prima facie evidence of the accuracy of the
information so recorded; PROVIDED, HOWEVER, the failure to make such notation(s)
with respect to any Borrowing shall not limit or otherwise affect the obligation
of the US Borrowers to the US Lenders under this Loan Agreement or the US
Revolving Credit Loan Notes. If the outstanding amount of the US Revolving
Credit Loans shall exceed the Maximum Amount of US Revolving Credit Loans at any
time, such excess shall be (1) immediately payable by the US Borrowers to the US
Lenders, (2) secured by the Collateral and (3) subject to the terms, conditions
and provisions of this Loan Agreement and the other Loan Documents.
(b) All US Revolving Credit Loans under this Loan Agreement
shall be made available by the US Lenders holding a US Revolving Credit
Commitment to the US Borrowers simultaneously and proportionately to their
respective US Revolving Credit Commitments, subject to the terms, conditions and
provisions of this Loan Agreement. It shall be understood that no US Lender
shall be responsible for any failure by any other US Lender to perform its
obligation to make available a US Revolving Credit Loan hereunder and that the
US Revolving Credit Commitment of any US Lender shall not be increased or
decreased as a result
of the failure by any other US Lender to perform its obligation to make a US
Revolving Credit Loan.
(c) US Revolving Credit Loans may be voluntarily prepaid
pursuant to the terms, conditions and provisions of SECTION 2.08(i) of this Loan
Agreement and, subject to the terms, conditions and provisions of this Loan
Agreement, any amounts so prepaid may be reborrowed, up to the amount available
under this SECTION 2.01(i) at the time of such Borrowing, until the Business Day
next preceding the US Revolving Credit Termination Date. Each US Lender's US
Revolving Credit Commitment shall expire automatically and each US Revolving
Credit Loan then outstanding shall be repaid by the US Borrowers no later than
the US Revolving Credit Termination Date. The final payment of all principal,
unpaid accrued interest, fees and expenses, if any, owing to the US Lenders on
the US Revolving Credit Loan Facility shall be due and payable on the US
Revolving Credit Termination Date.
(ii) NOTICE OF BORROWING. Whenever the US Borrowers desire to borrow
under this SECTION 2.01, the US Borrowers shall deliver to the Administrative
Agent a Notice of Borrowing no later than 10:00 A.M. (Cranford, New Jersey time)
(a) at least one (1) Business Day in advance of the proposed Borrowing Date, in
the case of a Borrowing as a Base Rate Loan and (b) at least three (3) Business
Days in advance of the proposed Borrowing Date in the case of a Borrowing as a
Eurodollar Rate Loan. The Notice of Borrowing shall specify (1) the Borrowing
Date (which shall be a Business Day) in respect of the US Revolving Credit Loan,
(2) the amount of the proposed Borrowing which shall not be less than
US$50,000.00 (except in those situations where a US Letter of Credit becomes a
US Reimbursement Obligation under SECTION 2.01(vi)(d)(2) hereof), (3) the
applicable interest rate option as described in SECTION 2.05(i) of this Loan
Agreement and, if applicable, (4) the Eurodollar Interest Period applicable
thereto. In lieu of delivering the above-described Notice of Borrowing, the US
Borrowers may give the Administrative Agent telephonic notice of any proposed
Borrowing by the time required under this SECTION 2.01(ii); PROVIDED, HOWEVER,
that such notice shall be confirmed in writing by delivery to the Administrative
Agent promptly (but in no event later than the Borrowing Date of the requested
US Revolving Credit Loan) of a Notice of Borrowing. Any Notice of Borrowing (or
telephonic notice in lieu thereof) pursuant to this SECTION 2.01(ii) shall be
irrevocable.
(iii) MAKING OF US REVOLVING CREDIT LOANS. (a) Promptly after
receipt of a Notice of Borrowing under SECTION 2.01(ii) above (or telephonic
notice in lieu thereof), the Administrative Agent shall notify the US Lenders
holding a US Revolving Credit Commitment by telex or telecopy or other similar
form of teletransmission, of the proposed Borrowing. Each such US Lender shall
make the amount of its Pro Rata Share of each US Revolving Credit Loan available
to the Administrative Agent in US Dollars and in immediately available funds, to
such bank and account, in Hackensack, New Jersey as the Administrative Agent may
designate, not later than 1:00 P.M. (Cranford, New Jersey time) on the Borrowing
Date. After the Administrative Agent's receipt of the proceeds of such US
Revolving Credit Loans, the Administrative Agent shall make the proceeds of such
US Revolving Credit Loan available to the US Borrowers in Hackensack, New Jersey
on such Borrowing Date and shall disburse such funds
in US Dollars and in immediately available funds to an account of the US
Borrowers maintained with the Administrative Agent and thereafter to any
substitute account, designated in writing by the US Borrowers in the Notice of
Borrowing.
(b) In connection with US Revolving Credit Loans funded
pursuant to the terms, conditions and provisions of SECTION 2.01(iii)(a) hereof,
unless the Administrative Agent shall have been notified by any US Lender
holding a US Revolving Credit Commitment prior to any Borrowing Date in respect
of any Borrowing of US Revolving Credit Loans that such US Lender does not
intend to make available to the Administrative Agent such US Lender's Pro Rata
Share of the requested US Revolving Credit Loan on such Borrowing Date, the
Administrative Agent may assume that such US Lender has made such amount
available to the Administrative Agent on such Borrowing Date and the
Administrative Agent in its sole discretion may, but shall not be obligated to,
make available to the US Borrowers a corresponding amount on such Borrowing
Date. If such corresponding amount is not in fact made available to the
Administrative Agent by such US Lender on or prior to a Borrowing Date, such US
Lender hereby agrees to pay (and, provided the Administrative Agent funds said
amount, the US Borrowers hereby agree to repay the Administrative Agent in
accordance with the terms of this Loan Agreement and the other Loan Documents)
such corresponding amount together with interest thereon, for each day from the
date such amount is made available to the US Borrowers until the date such
amount is paid or repaid to the Administrative Agent, at (1) in the case of such
non-performing US Lender, the Federal Funds Effective Rate and (2) in the case
of the US Borrowers, the interest rate applicable at the time to a Borrowing of
Base Rate Loans made on such Borrowing Date. If such non-performing US Lender
shall pay to the Administrative Agent such corresponding amount, such amount so
paid shall constitute such US Lender's Pro Rata Share of the US Revolving Credit
Loan and, if both such US Lender and the US Borrowers shall have paid and
repaid, respectively, such corresponding amount, the Administrative Agent shall
promptly return to the US Borrowers such corresponding amount in same day funds.
Nothing in this SECTION 2.01(iii) shall be deemed to relieve any US Lender of
its obligation hereunder to fund its Pro Rata Share of any US Revolving Credit
Loan on any Borrowing Date.
(iv) USE OF PROCEEDS OF US REVOLVING CREDIT LOANS AND USE OF US
LETTERS OF CREDIT. The proceeds of the US Revolving Credit Loans shall be used
by the US Borrowers for the purposes of financing (a) a portion of the US
Borrowers' working capital requirements with a sublimit of up to US$500,000.00
to provide for the issuance of documentary and standby letters of credit, (b) a
portion of the US Borrowers' requirements for capital expenditures in the
ordinary course of their businesses and (c) the repurchase of outstanding shares
of the common stock of Cantel Medical under and/or pursuant to any Stock
Repurchase Program in an amount not to exceed US$1,000,000.00 in the aggregate
at any time during the term of the US Revolving Credit Loan Facility, and for
other lawful and permitted corporate purposes to the extent not otherwise
prohibited hereunder. US Letters of Credit may be used in support of working
capital in the ordinary course of business and for other lawful and permitted
corporate purposes, to the extent not otherwise prohibited hereunder.
(v) REDUCTION OF US REVOLVING CREDIT COMMITMENTS; US REVOLVING
CREDIT TERMINATION DATE. (a) The US Borrowers shall have the right, at any time
and from time to time, to terminate in whole or permanently reduce in part,
without premium or fee, the US Revolving Credit Commitments by an amount not to
exceed the amount of (1) the aggregate US Revolving Credit Commitments in effect
at such time MINUS (2) the aggregate principal amount of the US Revolving Credit
Loans and US Letter of Credit Obligations then outstanding. The US Borrowers
shall give not less than five (5) Business Days' prior express written notice to
the Administrative Agent designating the date (which shall be a Business Day) of
such termination or permanent reduction and the amount of any partial permanent
reduction. Promptly after receipt of a notice of such termination or reduction,
the Administrative Agent shall notify each US Lender holding a US Revolving
Credit Commitment of the proposed termination or reduction. Such termination or
partial reduction of the US Revolving Credit Commitments shall be effective on
the date specified in the US Borrowers' notice and shall reduce the US Revolving
Credit Commitment of each US Lender holding a US Revolving Credit Commitment
proportionately in accordance with its Pro Rata Share of all of the US Revolving
Credit Commitments (including each US Lender's corresponding Pro Rata Share of
the US Letter of Credit Sublimit). Any such partial reduction of the US
Revolving Credit Commitments shall be in an aggregate minimum amount of
US$100,000.00 and integral multiples of US$50,000.00 in excess of that amount.
(b) Each US Lender's US Revolving Credit Commitment shall
expire without further action on the part of the US Lenders, and all then
outstanding US Revolving Credit Loans and US Reimbursement Obligations shall be
due and payable in full on the US Revolving Credit Termination Date.
(vi) ISSUANCE OF US LETTERS OF CREDIT. (a) Subject to the terms,
conditions and provisions set forth in this Loan Agreement, Summit Bank, in its
capacity as the Issuing Bank for US Letters of Credit, agrees to issue for the
account of the US Borrowers one or more US Letters of Credit in an aggregate
face amount at any one time outstanding (taken together with any and all US
Reimbursement Obligations then outstanding) not to exceed the US Letter of
Credit Sublimit, from time to time during the period commencing on the Closing
Date and ending on a Business Day at least sixty (60) Business Days preceding
the US Revolving Credit Termination Date. The US Letter of Credit Obligations
shall constitute financial accommodations under the US Revolving Credit Loan
Facility and shall reduce availability thereunder by the stated amount of such
US Letter of Credit Obligations. Each US Letter of Credit (1) shall be
denominated in US Dollars, (2) shall be in all instances either a standby letter
of credit or a documentary/commercial letter of credit and (3) shall expire no
later than thirty (30) days prior to the US Revolving Credit Termination Date;
PROVIDED, HOWEVER, the Issuing Bank agrees to issue US Letters of Credit which
expire later then the date which is thirty (30) days prior to the US Revolving
Credit Termination Date; PROVIDED THAT (A) all US Lenders then holding a US
Revolving Credit Commitment shall have given their prior express written consent
to such issuance and (B) the US Borrowers shall have deposited in an
interest-bearing cash collateral
account opened by the US Collateral Agent as collateral security for such US
Letters of Credit, Cash or Cash Equivalents in an amount equal to the face
amount of such US Letters of Credit. Each US Letter of Credit shall be subject
to the Uniform Customs and, to the extent not inconsistent therewith, the Laws
of the State of New Jersey.
(b) In addition to being subject to the satisfaction of the
conditions precedent contained in SECTION 3.02 hereof, the obligation of the
Issuing Bank to issue any US Letter of Credit is subject to the satisfaction in
full of the following conditions:
(1) the US Borrowers shall have delivered to the Issuing Bank
at such times and in such manner as the Issuing Bank may prescribe, a
Letter of Credit Reimbursement Agreement and such other documents and
materials as may be required pursuant to the terms thereof and the terms
of the proposed US Letter of Credit shall be reasonably satisfactory to
the Issuing Bank thereof;
(2) immediately after the issuance of such US Letter of
Credit, the aggregate principal amount of US Letter of Credit Obligations
then existing shall not exceed the US Letter of Credit Sublimit; and
(3) as of the date of issuance, no order, judgment or decree
of any court, arbitrator or Governmental Authority shall purport by its
terms to enjoin or restrain the Issuing Bank from issuing the US Letter of
Credit and no Law applicable to the Issuing Bank and no request or
directive (whether or not having the force of Law and whether or not the
failure to comply therewith would be unlawful) from any Governmental
Authority with jurisdiction over the Issuing Bank shall prohibit or
request that the Issuing Bank refrain from the issuance of letters of
credit generally or the issuance of such US Letter of Credit.
(c) To open a US Letter of Credit, the US Borrowers shall give
the Issuing Bank at least three (3) Business Days' prior written notice at the
following address: Summit Bank, 750 Walnut Avenue, Cranford, New Jersey 07016
not later than 10:00 A.M. (Cranford, New Jersey time) on the requested issuance
date thereof under this Loan Agreement. Such notice shall be irrevocable and
shall specify (A) the stated amount of the US Letter of Credit requested, (B)
the effective date (which day shall be a Business Day) of issuance of such
requested US Letter of Credit, (C) the date on which such requested US Letter of
Credit is to expire (which date shall be a Business Day), (D) the Person for
whose benefit the requested US Letter of Credit is to be issued, (E) the stated
amount of then outstanding US Letter of Credit Obligations and (F) the principal
amount of then outstanding US Revolving Credit Loans. A copy of such notice
shall be delivered by facsimile to the Administrative Agent contemporaneously
therewith at the Administrative Agent's Hackensack, New Jersey address.
(d) Notwithstanding any provisions to the contrary in any
Letter of Credit Reimbursement Agreement:
(1) the US Borrowers shall unconditionally reimburse the
Issuing Bank for drawings under such US Letter of Credit no later than the
time specified in such Letter of Credit Reimbursement Agreement,
irrespective of any claim, set-off, defense or other right which the US
Borrowers may have at any time against any Agent, the Issuing Bank and/or
any of the US Lenders, except with respect to such Agent's, the Issuing
Bank's and/or any US Lender's gross negligence or willful misconduct; and
(2) in connection with a US Letter of Credit issued by the
Issuing Bank, to the extent any US Reimbursement Obligation is not paid
when due, such US Reimbursement Obligation shall be automatically
converted to a US Revolving Credit Loan, in the form of a Base Rate Loan,
payable to the Issuing Bank in its capacity as a US Lender holding a US
Revolving Credit Commitment, in the amount of such US Reimbursement
Obligation and made in accordance with the terms, conditions and
provisions of SECTION 2.01(i) of this Loan Agreement; and
(3) any US Reimbursement Obligation with respect to any US
Letter of Credit which is converted to a US Revolving Credit Loan under
CLAUSE (2) above shall bear interest from the date of the relevant drawing
under the pertinent US Letter of Credit at the Default Rate applicable to
Base Rate Loans described in SECTION 2.05(i)(a) hereof, until repaid in
full; and
(4) With respect to all US Letters of Credit which, on or
before the US Revolving Credit Termination Date, have not been presented
for honor, notwithstanding the occurrence of the US Revolving Credit
Termination Date and the satisfaction of all other Obligations under the
Loan Documents, the US Borrowers' Obligations under the Loan Documents
shall continue after the US Revolving Credit Termination Date and the
Liens granted under and pursuant to the Loan Documents shall continue to
secure such US Letter of Credit Obligations until all amounts paid or to
be paid by the Issuing Bank under such US Letters of Credit have been
reimbursed and all such original US Letters of Credit have been returned
to the Issuing Bank for cancellation; PROVIDED, HOWEVER, that the US
Collateral Agent may release the Liens under the Loan Documents (but not
the other Obligations thereunder) upon (A) the deposit by the US Borrowers
in an interest-bearing cash collateral account opened by the US Collateral
Agent of an amount in Cash or Cash Equivalents equal to the aggregate
amount of the US Letter of Credit Obligations to collateralize the US
Reimbursement Obligations with respect to such US Letters of Credit or (B)
an indemnification agreement from a financial institution or "back-up"
letters of credit issued by a financial institution in favor of the
Issuing Bank all in form and substance reasonably satisfactory to the US
Collateral Agent. Notwithstanding, the payment of all other Obligations
under the Loan Documents, the US Reimbursement Obligations associated with
such US Letters of Credit shall accrue interest in accordance with SECTION
2.01(vi)(d)(3) above until such US Reimbursement Obligations have been
satisfied in full; and
(5) With respect to any US Reimbursement Obligation, such US
Reimbursement Obligation shall: (A) be payable by the US Borrowers upon
demand, (B) be deemed to be a US Revolving Credit Loan as described in
SECTION 2.01(vi)(d)(2) above, (C) bear interest from the date of payment
by the Issuing Bank at the interest rate applicable to Base Rate Loans
described in SECTION 2.05(i)(a) below, until repaid in full and (D) be
subject to immediate reimbursement by the US Lenders to the Issuing Bank,
in an amount equal to each US Lender's Pro Rata Credit Share of the US
Revolving Credit Commitments.
(e) No action taken or omitted to be taken by the Issuing Bank
under or in connection with any US Letter of Credit (except in connection with
its gross negligence or willful misconduct) shall put the Issuing Bank under any
resulting liability to the US Borrowers and/or any US Lender or, subject to
SUBPARAGRAPH (B) above, relieve any US Lender of its obligations hereunder to
reimburse the Issuing Bank. In the event this Loan Agreement and any Letter of
Credit Reimbursement Agreement are inconsistent, the terms of this Loan
Agreement shall prevail. In determining whether to pay under any US Letter of
Credit, the Issuing Bank shall have no obligation to the other US Lenders other
than to confirm that any documents required to be delivered under such US Letter
of Credit appear to have been delivered and that they appear on their face to
comply with the requirements of such US Letter of Credit.
(f) (1) Immediately upon issuance by the Issuing Bank of any
US Letter of Credit for the account of the US Borrowers in accordance with
the procedures set forth in this SECTION 2.01(vi), each US Lender holding
a US Revolving Credit Commitment shall be deemed to have irrevocably and
unconditionally purchased and received from the Issuing Bank WITHOUT
RECOURSE TO OR WARRANTY from the Issuing Bank an undivided interest in
such US Letter of Credit in the amount of such US Lender's Pro Rata Share
of the US Revolving Credit Commitments (including, without limitation, all
obligations of the US Borrowers with respect thereto other than amounts
owing to the Issuing Bank under SECTION 2.05(ii) hereof) and any security
therefor or guaranty pertaining thereto.
(2) If the Issuing Bank makes any payment under any US Letter
of Credit (whether prior or subsequent to the US Revolving Credit
Termination Date) and the US Borrowers do not repay such amount to the
Issuing Bank pursuant to SECTION 2.01(vi)(d)(1) above or effect a
Borrowing as provided for in SECTION 2.01(vi)(d)(2) above, the
Administrative Agent shall promptly notify the US Lenders holding US
Revolving Credit Commitments of such failure, and each such other US
Lender shall promptly and unconditionally pay to the Administrative Agent
for the account of the Issuing Bank the amount of such US Lender's Pro
Rata Share of such payment, in US Dollars and in immediately available
funds, and the Administrative Agent shall promptly pay such amount, and
any other amounts received by the Administrative Agent for the Issuing
Bank's account pursuant to this SECTION 2.01(vi)(f), to the Issuing Bank.
If the
Administrative Agent so notifies a US Lender prior to 10:00 A.M.
(Cranford, New Jersey time) on any Business Day, such US Lender shall make
available to the Administrative Agent for the account of the Issuing Bank,
its Pro Rata Share of the amount of such payment on such Business Day in
US Dollars and in immediately available funds in Cranford, New Jersey. If
and to the extent such US Lender shall not have so made its Pro Rata Share
of the amount of such payment available to the Administrative Agent for
the account of the Issuing Bank, such US Lender hereby agrees to pay to
the Administrative Agent for the account of the Issuing Bank forthwith on
demand such amount together with interest thereon, for each day from the
date such payment was first due until the date such amount is paid to the
Administrative Agent for the account of the Issuing Bank, at the Federal
Funds Effective Rate for three (3) Business Days and thereafter at the
Base Rate. The failure of any US Lender to make available to the
Administrative Agent for the account of the Issuing Bank its Pro Rata
Share of any such payment shall not relieve any other US Lender of its
obligation hereunder to make available to the Administrative Agent for the
account of the Issuing Bank its Pro Rata Share of any payment on the date
such payment is to be made.
(3) Whenever the Issuing Bank receives a payment on account of
a US Reimbursement Obligation, including any interest thereon, as to which
the Administrative Agent has previously received payments from the US
Lenders holding US Revolving Credit Commitments for the account of the
Issuing Bank pursuant to this SECTION 2.01(vi)(f), it shall promptly pay
to the Administrative Agent, and the Administrative Agent shall promptly
pay to each US Lender which has funded its participating interest therein,
in Hackensack, New Jersey, in US Dollars and in the kind of funds so
received, an amount equal to such US Lender's Pro Rata Share thereof. Each
such payment shall be made by the Issuing Bank or the Administrative
Agent, as the case may be, on the Business Day on which such Person
receives the funds paid to such Person pursuant to the preceding sentence,
if received prior to 10:00 A.M. (Cranford, New Jersey time) on such
Business Day, and otherwise on the next succeeding Business Day.
(4) The obligations of any US Lender holding a US Revolving
Credit Commitment to make payments to the Administrative Agent for the
account of the Issuing Bank with respect to a US Letter of Credit issued
on behalf of the US Borrowers by such Issuing Bank shall be irrevocable,
shall not be subject to any qualification or exception whatsoever and
shall be honored in accordance with the terms and conditions of this Loan
Agreement under all circumstances (subject to the terms, conditions and
provisions of SECTION 2.01(vi)(b) above) including, without limitation any
of the following circumstances (except in connection with the gross
negligence or willful misconduct of the Issuing Bank):
(A) any lack of validity or enforceability of this Loan
Agreement or any of the other Loan Documents;
(B) the existence of any claim, set-off, defense or
other right which the US Borrowers may have at any time against a
beneficiary named in a US Letter of Credit or any transferee of any US
Letter of Credit (or any Person for whom any such transferee may be
acting), the Administrative Agent, the Issuing Bank, any US Lender or any
other Person, whether in connection with this Loan Agreement, any US
Letter of Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transactions between the US
Borrowers and the beneficiary named in any US Letter of Credit);
(C) any draft, certificate of any other document
presented under any US Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(D) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents;
(E) any failure by the Administrative Agent or the
Issuing Bank to make any reports required pursuant to SECTION 2.09(v)
below; or
(F) the occurrence of any Event of Default or Potential
Event of Default.
(g) (1) The US Borrowers hereby unconditionally agree to pay
to the Issuing Bank the amount of all US Reimbursement Obligations,
interest and other amounts payable to the Issuing Bank under or in
connection with any US Letter of Credit issued on behalf of one or more of
the US Borrowers immediately when due, irrespective of any claim, set-off,
defense or other right which the US Borrowers may have at any time against
the Issuing Bank or any other Person.
(2) In the event any payment by the US Borrowers received by
the Issuing Bank with respect to such US Letter of Credit and distributed
by the Administrative Agent to the US Lenders holding a US Revolving
Credit Commitment on account of their participations is thereafter set
aside, avoided or recovered from the Issuing Bank in connection with any
receivership, liquidation or bankruptcy proceeding or otherwise, each US
Lender which received such distribution shall, upon demand by the Issuing
Bank, contribute such US Lender's Pro Rata Share of the amount set aside,
avoided or recovered together with interest at the rate required to be
paid by the Issuing Bank upon the amount required to be repaid by it.
(vii) ISSUING BANK, ADMINISTRATIVE AGENT AND US LENDERS NOT LIABLE.
(a) In addition to amounts payable as elsewhere provided in SECTION 2.01(vi)
above, the US Borrowers hereby agree on a JOINT AND SEVERAL BASIS to protect,
indemnify, pay and save the Administrative Agent, the Issuing Bank and each US
Lender harmless from and against any and all Liabilities
and Costs which the Administrative Agent or the Issuing Bank or any US Lender
may incur or be subject to as a consequence, direct or indirect, of (1) the
issuance of a US Letter of Credit for the account of the US Borrowers other
than, in the case of the Issuing Bank, as a result of its gross negligence or
willful misconduct, as determined by the final judgment of a court of competent
jurisdiction or (2) the failure of the Issuing Bank to honor a drawing under
such US Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future DE JURE or DE FACTO Governmental Authority
(all such acts or omissions hereinafter referred to as the "Governmental Acts").
(b) As between the US Borrowers and their Subsidiaries, the US
Lenders, the Administrative Agent and the Issuing Bank, subject to the second to
the last sentence of this SECTION 2.01(vii)(b), the US Borrowers assume all
risks of the acts and omissions of, or misuse of any US Letter of Credit by the
beneficiary of such US Letter of Credit. In furtherance and not in limitation of
the foregoing, subject to the provisions of the applicable Letter of Credit
Reimbursement Agreements, the Administrative Agent, the Issuing Bank and the US
Lenders shall not be responsible: (1) for the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by the US
Borrowers or the beneficiary in connection with the application for and issuance
of the US Letters of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (2) for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a US Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (3) for failure of the beneficiary of a
US Letter of Credit to comply duly with conditions required in order to draw
upon such US Letter of Credit; (4) for errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex, or other similar form of teletransmission or otherwise, whether or not
they be in cipher; (5) for errors in interpretation of technical terms; (6) for
any loss or delay in the transmission or otherwise of any document required in
order to make a drawing under any US Letter of Credit or of the proceeds
thereof; (7) for the misapplication by the beneficiary of a US Letter of Credit
of the proceeds of any drawing under such US Letter of Credit; and (8) for any
consequences arising from causes beyond the control of the Administrative Agent,
the Issuing Bank and the US Lenders including, without limitation, any
Governmental Acts. None of the above shall affect, impair, or prevent the
vesting of any of the rights or powers of the Issuing Bank under this
SUBPARAGRAPH (b); PROVIDED, HOWEVER, the US Borrowers may have a Claim against
the Administrative Agent, the Issuing Bank and/or the US Lenders, to the extent
of any direct, but not consequential, damages suffered by the US Borrowers that
were caused by such Person's willful misconduct or gross negligence. In
furtherance and not in limitation of the foregoing, the Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
(c) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by the
Issuing Bank under or in connection with US Letters of Credit issued on behalf
of the US Borrowers or any related
certificates, if taken or omitted in good faith, shall not, in the absence of an
express violation of the standards set forth in the Uniform Customs and
subsequent revisions thereof, put the Issuing Bank, the Administrative Agent or
any US Lender under any resulting liability to the US Borrowers or relieve the
US Borrowers of any of their obligations hereunder to any such Person.
SECTION 2.02 CANADIAN REVOLVING CREDIT LOAN FACILITY.
(i) AVAILABILITY. (a) Subject to the terms and conditions set forth
in this Loan Agreement, and provided no Event of Default or Potential Event of
Default shall have occurred and be continuing, each Canadian Lender hereby
SEVERALLY (AND NOT JOINTLY OR JOINTLY AND SEVERALLY) agrees to make available to
and for the benefit of the Canadian Borrower from time to time during the period
from the Closing Date to the Business Day next preceding the Canadian Revolving
Credit Termination Date, revolving credit loans (hereinafter each individually
referred to as a "Canadian Revolving Credit Loan" and collectively referred to
as the "Canadian Revolving Credit Loans"), in a principal amount which shall not
exceed, in the aggregate at any time outstanding, such Canadian Lender's
Canadian Revolving Credit Commitment in effect at such time; PROVIDED, HOWEVER,
that (1) at no time shall the Dollar Equivalent of the aggregate principal
amount of all Canadian Revolving Credit Loans outstanding at any time exceed the
Maximum Amount of Canadian Revolving Credit Loans at such time, (2) at no time
shall the aggregate Dollar Equivalent of the outstanding principal amount of
Canadian Letter of Credit Obligations ever exceed the Canadian Letter of Credit
Sublimit at such time and (3) Canadian Revolving Credit Loans shall be (A) made
solely to the Canadian Borrowers, (B) made only by the Canadian Lenders and (C)
denominated in either US Dollars or Canadian Dollars, at the option of the
Canadian Borrower, except for Canadian Bankers Acceptances which shall only be
denominated in Canadian Dollars. The Canadian Revolving Credit Loans may be
either Canadian Bankers Acceptances, Eurodollar Rate Loans or Base Rate Loans.
The Canadian Revolving Credit Loans (except for Canadian Bankers Acceptances)
shall be evidenced by the Canadian Revolving Credit Loan Notes. Each Canadian
Lender is hereby authorized to record the date and amount of each Canadian
Revolving Credit Loan made by said Canadian Lender and the date and amount of
each payment or prepayment of principal thereof either (1) on the SCHEDULE "1"
annexed to and constituting a part of said Canadian Lender's Canadian Revolving
Credit Loan Note or (2) by entering such information into said Canadian Lender's
automated loan tracking system, and any such recordation shall constitute prima
facie evidence of the accuracy of the information so recorded; PROVIDED,
HOWEVER, the failure to make such notation(s) with respect to any Borrowing
shall not limit or otherwise affect the obligation of the Canadian Borrower to
the Canadian Lenders under this Loan Agreement or the Canadian Revolving Credit
Loan Notes. If the outstanding amount of the Canadian Revolving Credit Loans
(including the aggregate undiscounted face amount of Canadian Bankers
Acceptances) shall exceed the Maximum Amount of Canadian Revolving Credit Loans
at any time, such excess shall be (1) immediately payable by the Canadian
Borrower to the Canadian Lenders, (2) secured by the Collateral and (3) subject
to the terms, conditions and provisions of this Loan Agreement and the other
Loan Documents.
(b) Each Canadian Revolving Credit Loan under this Loan
Agreement shall be made available by the Canadian Lenders simultaneously and
proportionately to their respective Canadian Revolving Credit Commitments. It
shall be understood that no Canadian Lender shall be responsible for any failure
by any other Canadian Lender to perform its obligation to make available a
Canadian Revolving Credit Loan hereunder and that the Canadian Revolving Credit
Commitment of any Canadian Lender shall not be increased or decreased as a
result of the failure by any other Canadian Lender to perform its obligation to
make a Canadian Revolving Credit Loan.
(c) Canadian Revolving Credit Loans (EXCEPT for Canadian
Bankers Acceptances) may be voluntarily prepaid pursuant to the terms,
conditions and provisions of SECTION 2.08(i) of this Loan Agreement and, subject
to the terms, conditions and provisions of this Loan Agreement, any amounts so
prepaid may be reborrowed, up to the amount available under this SECTION 2.02(i)
at the time of such Borrowing, until the Business Day next preceding the
Canadian Revolving Credit Termination Date. Each Canadian Lender's Canadian
Revolving Credit Commitment shall expire automatically and each Canadian
Revolving Credit Loan then outstanding shall be repaid by the Canadian Borrower
no later than the Canadian Revolving Credit Termination Date. The final payment
of all principal, unpaid accrued interest, fees and expenses, if any, owing to
the Canadian Lenders on the Canadian Revolving Credit Loan Facility shall be due
and payable on the Canadian Revolving Credit Termination Date.
(ii) NOTICE OF BORROWING. Whenever the Canadian Borrower desires to
borrow under this SECTION 2.02, the Canadian Borrower shall deliver to the
Canadian Collateral Agent a Notice of Borrowing no later than 10:00 A.M.
(Toronto, Ontario time) (a) at least one (1) Business Day in advance of the
proposed Borrowing Date, in the case of a Borrowing as a Base Rate Loan, (b) at
least two (2) Business Days in advance of the proposed Borrowing Date in the
case of a Borrowing as a Canadian Bankers Acceptance and (c) at least three (3)
Business Days in advance of the proposed Borrowing Date in the case of a
Borrowing as a Eurodollar Rate Loan. The Notice of Borrowing shall specify (1)
the Borrowing Date (which shall be a Business Day) in respect of the Canadian
Revolving Credit Loan, (2) the amount of the proposed Borrowing which shall not
be less than US$100,000.00 or the Canadian Dollar Equivalent (except in those
situations where a Canadian Reimbursement Obligation becomes a Canadian
Revolving Credit Loan under SECTION 2.02(vi)(d)(2) hereof), (3) the applicable
interest rate option as described in SECTION 2.05(i) of this Loan Agreement, (4)
in the case of a Borrowing as a Canadian Bankers Acceptance, the term for such
Canadian Bankers Acceptance, (5) in the case of a Borrowing as a Eurodollar Rate
Loan, the Eurodollar Interest Period applicable thereto and (6) whether the
proceeds of such Canadian Revolving Credit Loan shall be made available in US
Dollars or Canadian Dollars. In lieu of delivering the above-described Notice of
Borrowing, the Canadian Borrower may give the Canadian Collateral Agent
telephonic notice of any proposed Borrowing by the time required under this
SECTION 2.02(ii); PROVIDED, HOWEVER, that such notice shall be confirmed in
writing by delivery to the Canadian Collateral Agent promptly (but in no event
later than the Borrowing Date of the requested Canadian Revolving Credit Loan)
of a Notice of Borrowing. Any Notice of Borrowing (or telephonic notice in lieu
thereof) pursuant to
this SECTION 2.02(ii) shall be irrevocable.
(iii) MAKING OF CANADIAN REVOLVING CREDIT LOANS (OTHER THAN CANADIAN
BANKERS ACCEPTANCES). (a) Promptly after receipt of a Notice of Borrowing under
SECTION 2.02(ii) above (or telephonic notice in lieu thereof), the Canadian
Collateral Agent shall notify the Canadian Lenders by telex or telecopy or other
similar form of teletransmission, of the proposed Borrowing. Each such Canadian
Lender shall make the amount of its Pro Rata Share of each Canadian Revolving
Credit Loan available in Canadian Dollars or US Dollars, as selected by the
Canadian Borrower in the applicable Notice of Borrowing, and in immediately
available funds to such bank and account in Toronto, Ontario as the Canadian
Collateral Agent may designate, not later than 1:00 P.M. (Toronto, Ontario time)
on the Borrowing Date. After such bank's receipt of the proceeds of such
Canadian Revolving Credit Loans, the Canadian Collateral Agent shall then cause
such proceeds of such Canadian Revolving Credit Loan to be made available to the
Canadian Borrower in Toronto, Ontario on such Borrowing Date and shall cause
such proceeds to be disbursed in Canadian Dollars or US Dollars, as selected by
the Canadian Borrower in the applicable Notice of Borrowing, and in immediately
available funds to any account of the Canadian Borrower designated in writing by
the Canadian Borrower in the Notice of Borrowing.
(b) In connection with Canadian Revolving Credit Loans funded
pursuant to the terms, conditions and provisions of SECTION 2.02(iii)(a) hereof,
unless the Canadian Collateral Agent shall have been notified by any Canadian
Lender prior to any Borrowing Date in respect of any Borrowing of Canadian
Revolving Credit Loans that such Canadian Lender does not intend to make
available to the Canadian Collateral Agent such Canadian Lender's Pro Rata Share
of the requested Canadian Revolving Credit Loan on such Borrowing Date, the
Canadian Collateral Agent may assume that such Canadian Lender has made such
amount available to the bank designated by the Canadian Collateral Agent, as
contemplated by SECTION 2.02(iii)(a) above, on such Borrowing Date and the
Canadian Collateral Agent in its sole discretion may, but shall not be obligated
to, make available to the Canadian Borrower a corresponding amount on such
Borrowing Date. If such corresponding amount is not in fact made available to
the Canadian Collateral Agent by such Canadian Lender on or prior to a Borrowing
Date, such Canadian Lender hereby agrees to pay (and, provided the Canadian
Collateral Agent funds said amount, the Canadian Borrower hereby agrees to repay
the Canadian Collateral Agent in accordance with the terms of this Loan
Agreement and the other Loan Documents) such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Canadian Borrower until the date such amount is paid or repaid to the
Canadian Collateral Agent, at (1) in the case of such non-performing Canadian
Lender, at the rate which the Canadian Collateral Agent would be required to pay
to borrow funds on an overnight basis and (2) in the case of the Canadian
Borrower, the interest rate applicable at the time to a Borrowing of Base Rate
Loans made on such Borrowing Date. If such non-performing Canadian Lender shall
pay to the Canadian Collateral Agent such corresponding amount, such amount so
paid shall constitute such Canadian Lender's Pro Rata Share of the Canadian
Revolving Credit Loan and, if both such Canadian Lender and the Canadian
Borrower
shall have paid and repaid, respectively, such corresponding amount, the
Canadian Collateral Agent shall promptly advance to the Canadian Borrower such
corresponding amount in same day funds (with the intent that the Canadian
Borrower shall, in effect, receive the advance funded by such Canadian Lender
and the Canadian Collateral Agent shall have been reimbursed for its interim
funding, if any). Nothing in this SECTION 2.02(iii) shall be deemed to relieve
any Canadian Lender of its obligation hereunder to fund its Pro Rata Share of
any Canadian Revolving Credit Loan on any Borrowing Date.
(iv) USE OF PROCEEDS OF CANADIAN REVOLVING CREDIT LOANS AND USE OF
CANADIAN LETTERS OF CREDIT. The proceeds of the Canadian Revolving Credit Loans
shall be used by the Canadian Borrower for the purposes of financing (a) a
portion of the Canadian Borrower's working capital requirements with a sublimit
of up to One Million and 00/100 (US$1,000,000.00) Dollars to provide for the
issuance of documentary and standby letters of credit and (b) a portion of the
Canadian Borrower's requirements for capital expenditures in the ordinary course
of its business and for other lawful and permitted corporate purposes to the
extent not otherwise prohibited hereunder. Canadian Letters of Credit may be
used in support of working capital in the ordinary course of business and for
other lawful and permitted corporate purposes to the extent not otherwise
prohibited hereunder.
(v) REDUCTION OF CANADIAN REVOLVING CREDIT COMMITMENTS; CANADIAN
REVOLVING CREDIT TERMINATION DATE. (a) The Canadian Borrower shall have the
right, at any time and from time to time, to terminate in whole or permanently
reduce in part, without premium or fee, the Canadian Revolving Credit
Commitments by an amount not to exceed the amount of (1) the aggregate Canadian
Revolving Credit Commitments in effect at such time MINUS (2) the aggregate
principal amount of the Canadian Revolving Credit Loans and the Canadian Letter
of Credit Obligations then outstanding. The Canadian Borrower shall give not
less than five (5) Business Days' prior express written notice to the Canadian
Collateral Agent designating the date (which shall be a Business Day) of such
termination or permanent reduction and the amount of any partial permanent
reduction. Promptly after receipt of a notice of such termination or reduction,
the Canadian Collateral Agent shall notify each Canadian Lender of the proposed
termination or reduction. Such termination or partial reduction of the Canadian
Revolving Credit Commitments shall be effective on the date specified in the
Canadian Borrower's notice and shall reduce the Canadian Revolving Credit
Commitment of each Canadian Lender proportionately in accordance with its Pro
Rata Share of all of the Canadian Revolving Credit Commitments (including each
Canadian Lender's corresponding Pro Rata Share of the Canadian Letter of Credit
Sublimit). Any such partial reduction of the Canadian Revolving Credit
Commitments shall be in an aggregate minimum amount of US$100,000.00 and
integral multiples of US$50,000.00 in excess of that amount.
(b) Each Canadian Lender's Canadian Revolving Credit
Commitment shall expire without further action on the part of the Canadian
Lenders, and all then outstanding Canadian Revolving Credit Loans and Canadian
Reimbursement Obligations shall be due and payable in full on the Canadian
Revolving Credit Termination Date.
(vi) ISSUANCE OF CANADIAN LETTERS OF CREDIT. (a) Subject to the
terms, conditions and provisions set forth in this Loan Agreement, Mellon
Canada, in its capacity as the Issuing Bank for Canadian Letters of Credit,
agrees to issue for the account of the Canadian Borrower one or more Canadian
Letters of Credit in an aggregate face amount at any one time outstanding (taken
together with any and all Canadian Reimbursement Obligations then outstanding)
not to exceed the Canadian Letter of Credit Sublimit, from time to time during
the period commencing on the Closing Date and ending on a Business Day at least
sixty (60) Business Days preceding the Canadian Revolving Credit Termination
Date. The Canadian Letter of Credit Obligations shall constitute financial
accommodations under the Canadian Revolving Credit Loan Facility and shall
reduce availability thereunder by the stated amount of such Canadian Letter of
Credit Obligations. Each Canadian Letter of Credit (1) shall be denominated in
Canadian Dollars or US Dollars, as requested in writing by the Canadian
Borrower, (2) shall be in all instances either a standby letter of credit or a
documentary/commercial letter of credit and (3) shall expire no later than the
date which is thirty (30) days prior to the Canadian Revolving Credit
Termination Date; PROVIDED, HOWEVER, the Issuing Bank agrees to issue Canadian
Letters of Credit which expire later than the date which is thirty (30) days
prior to the Canadian Revolving Credit Termination Date; PROVIDED THAT (A) all
Canadian Lenders shall have given their prior express written consent to such
issuance and (B) the Canadian Borrower shall have deposited in an
interest-bearing cash collateral account opened by the Canadian Collateral Agent
as collateral security for such Canadian Letters of Credit, Cash or Cash
Equivalents in an amount equal to the face amount of such Canadian Letters of
Credit. Each Canadian Letter of Credit shall be subject to the Uniform Customs
and, to the extent not inconsistent therewith, the Laws of the Province of
Ontario, Canada.
(b) In addition to being subject to the satisfaction of the
conditions precedent contained in SECTION 3.02 hereof, the obligation of the
Issuing Bank to issue any Canadian Letter of Credit is subject to the
satisfaction in full of the following conditions:
(1) the Canadian Borrower shall have delivered to the Issuing
Bank at such times and in such manner as the Issuing Bank may prescribe, a
Letter of Credit Reimbursement Agreement and such other documents and
materials as may be required pursuant to the terms thereof and the terms
of the proposed Canadian Letter of Credit shall be reasonably satisfactory
to the Issuing Bank thereof;
(2) immediately after the issuance of such Canadian Letter of
Credit, the aggregate principal amount of Canadian Letter of Credit
Obligations then existing shall not exceed the Canadian Letter of Credit
Sublimit; and
(3) as of the date of issuance, no order, judgment or decree
of any court, arbitrator or Governmental Authority shall purport by its
terms to enjoin or restrain the Issuing Bank from issuing the Canadian
Letter of Credit and no Law applicable to the Issuing Bank and no request
or directive (whether or not having the force of Law and
whether or not the failure to comply therewith would be unlawful) from any
Governmental Authority with jurisdiction over the Issuing Bank shall
prohibit or request that the Issuing Bank refrain from the issuance of
letters of credit generally or the issuance of such Canadian Letter of
Credit.
(c) To open a Canadian Letter of Credit, the Canadian Borrower
shall give the Issuing Bank at least three (3) Business Days' prior written
notice at the following address: Mellon Bank, N.A., Canada Branch, Royal Trust
Tower, 32nd Floor, Toronto Dominion Center, Toronto, Ontario, M5K 1K2 not later
than 10:00 A.M. (Toronto, Ontario time) on the requested issuance date thereof
under this Loan Agreement. Such notice shall be irrevocable and shall specify
(A) the stated amount of the Canadian Letter of Credit requested, (B) the
effective date (which day shall be a Business Day) of issuance of such requested
Canadian Letter of Credit, (C) the date on which such requested Canadian Letter
of Credit is to expire (which date shall be a Business Day and otherwise in
accordance with the terms of this Loan Agreement), (D) the Person for whose
benefit the requested Canadian Letter of Credit is to be issued, (E) the stated
amount of then outstanding Canadian Letter of Credit Obligations, (F) the
principal amount of then outstanding Canadian Revolving Credit Loans and (G) the
requested currency, whether Canadian Dollars or US Dollars. A copy of such
notice shall be delivered by facsimile to the Administrative Agent
contemporaneously therewith at the Administrative Agent's Hackensack, New Jersey
address.
(d) Notwithstanding any provisions to the contrary in any
Letter of Credit Reimbursement Agreement:
(1) the Canadian Borrower shall unconditionally reimburse the
Issuing Bank for drawings under such Canadian Letter of Credit no later
than the time specified in such Letter of Credit Reimbursement Agreement,
irrespective of any claim, set-off, defense or other right which the
Canadian Borrower may have at any time against any Agent, the Issuing Bank
and/or any of the Canadian Lenders, except with respect to such Agent's,
the Issuing Bank's and/or any Canadian Lender's gross negligence or
willful misconduct; and
(2) in connection with a Canadian Letter of Credit issued by
the Issuing Bank, to the extent any Canadian Reimbursement Obligation is
not paid when due, such Canadian Reimbursement Obligation shall be
automatically converted to a Canadian Revolving Credit Loan, in the form
of a Base Rate Loan, payable to the Issuing Bank in its capacity as a
Canadian Lender, in the amount of such Canadian Reimbursement Obligation
and made in accordance with terms, conditions and provisions of SECTION
2.02(i) of this Loan Agreement; and
(3) any Canadian Reimbursement Obligation with respect to any
Canadian Letter of Credit which is converted to a Canadian Revolving
Credit Loan under CLAUSE (2) above shall bear interest from the date of
the relevant drawing under the
pertinent Canadian Letter of Credit at the Default Rate applicable to Base
Rate Loans described in SECTION 2.05(i)(a) hereof, until repaid in full;
and
(4) With respect to all Canadian Letters of Credit which, on
or before the Canadian Revolving Credit Termination Date, have not been
presented for honor, notwithstanding the occurrence of the Canadian
Revolving Credit Termination Date and the satisfaction of all other
Obligations under the Loan Documents, the Canadian Borrower's Obligations
under the Loan Documents shall continue after the Canadian Revolving
Credit Termination Date and the Liens granted under and pursuant to the
Loan Documents shall continue to secure such Canadian Letter of Credit
Obligations until all amounts paid or to be paid by the Issuing Bank under
such Canadian Letters of Credit have been reimbursed and until all such
original Canadian Letters of Credit have been returned to the Issuing Bank
for cancellation; PROVIDED, HOWEVER, that the Canadian Collateral Agent
may release the Liens under the Loan Documents (but not the other
Obligations thereunder) upon (A) the deposit by the Canadian Borrower in
an interest-bearing cash collateral account opened by the Canadian
Collateral Agent, for the benefit of the Canadian Lenders, of an amount in
Cash or Cash Equivalents equal to the aggregate amount of the Canadian
Letter of Credit Obligations to collateralize the Canadian Reimbursement
Obligations with respect to such Canadian Letters of Credit or (B) an
indemnification agreement from a financial institution or "back-up"
letters of credit issued by a financial institution in favor of the
Issuing Bank all in form and substance reasonably satisfactory to the
Canadian Collateral Agent. Notwithstanding, the payment of all other
Obligations under the Loan Documents, the Canadian Reimbursement
Obligations associated with such Canadian Letters of Credit shall accrue
interest in accordance with SECTION 2.02(vi)(d)(3) above until such
Canadian Reimbursement Obligations have been satisfied in full; and
(5) With respect to any Canadian Reimbursement Obligation,
such Canadian Reimbursement Obligation shall: (A) be payable by the
Canadian Borrower upon demand, (B) be deemed to be a Canadian Revolving
Credit Loan as described in SECTION 2.02(vi)(d)(2) above, (C) bear
interest from the date of payment by the Issuing Bank at the interest rate
applicable to Base Rate Loans described in SECTION 2.05(i)(a) below, until
repaid in full and (D) be subject to immediate reimbursement by the
Canadian Lenders to the Issuing Bank, in an amount equal to each Canadian
Lender's Pro Rata Credit Share of the Canadian Revolving Credit
Commitments.
(e) No action taken or omitted to be taken by the Issuing Bank
under or in connection with any Canadian Letter of Credit (except in connection
with its gross negligence or willful misconduct) shall put the Issuing Bank
under any resulting liability to the Canadian Borrower and/or any Canadian
Lender or, subject to SUBPARAGRAPH (b) above, relieve any Canadian Lender of its
obligations hereunder to reimburse the Issuing Bank. In the event this Loan
Agreement and any Letter of Credit Reimbursement Agreement are inconsistent, the
terms of this Loan Agreement shall prevail. In determining whether to pay under
any Canadian
Letter of Credit, the Issuing Bank shall have no obligation to the other
Canadian Lenders other than to confirm that any documents required to be
delivered under such Canadian Letter of Credit appear to have been delivered and
that they appear on their face to comply with the requirements of such Canadian
Letter of Credit.
(f) (1) Immediately upon issuance by the Issuing Bank of any
Canadian Letter of Credit for the account of the Borrowers in accordance
with the procedures set forth in this SECTION 2.02(vi), each Canadian
Lender shall be deemed to have irrevocably and unconditionally purchased
and received from the Issuing Bank WITHOUT RECOURSE TO OR WARRANTY from
the Issuing Bank an undivided interest in such Canadian Letter of Credit
in the amount of such Canadian Lender's Pro Rata Share (including, without
limitation, all obligations of the Canadian Borrower with respect thereto
other than amounts owing to the Issuing Bank under SECTION 2.05(ii)
hereof) and any security therefor or guaranty pertaining thereto.
(2) If the Issuing Bank makes any payment under any Canadian
Letter of Credit (whether prior or subsequent to the Canadian Revolving
Credit Termination Date) and the Canadian Borrower does not repay such
amount to the Issuing Bank pursuant to SECTION 2.02(vi)(d)(1) above or
effect a Borrowing as provided for in SECTION 2.02(vi)(d)(2) above, the
Issuing Bank shall promptly notify the Canadian Collateral Agent and the
Canadian Lenders of such failure, and each Canadian Lender shall promptly
and unconditionally pay to the Canadian Collateral Agent for the account
of the Issuing Bank the amount of such Canadian Lender's Pro Rata Share of
such payment, in Canadian Dollars or US Dollars, as appropriate, and in
immediately available funds, and the Canadian Collateral Agent shall
promptly pay such amount, and any other amounts received by the Canadian
Collateral Agent for the Issuing Bank's account pursuant to this SECTION
2.02(vi)(f), to the Issuing Bank. If the Canadian Collateral Agent so
notifies a Canadian Lender prior to 10:00 a.m. (Toronto, Ontario time) on
any Business Day, such Canadian Lender shall make available to the
Canadian Collateral Agent for the account of the Issuing Bank, its Pro
Rata Share of the amount of such payment on such Business Day in Canadian
Dollars or US Dollars, as appropriate, and in immediately available funds
in Toronto, Ontario. If and to the extent such Canadian Lender shall not
have so made its Pro Rata Share of the amount of such payment available to
the Canadian Collateral Agent for the account of the Issuing Bank, such
Canadian Lender hereby agrees to pay to the Canadian Collateral Agent for
the account of the Issuing Bank forthwith on demand such amount together
with interest thereon, for each day from the date such payment was first
due until the date such amount is paid to the Canadian Collateral Agent
for the account of the Issuing Bank, at the rate which the Canadian
Collateral Agent would be required to pay to borrow funds on an overnight
basis for three (3) Business Days and thereafter at the Base Rate. The
failure of any Canadian Lender to make available to the Canadian
Collateral Agent for the account of the Issuing Bank its Pro Rata Share of
any such payment shall not relieve any other Canadian Lender of its
obligation hereunder to make available to the Canadian Collateral Agent
for the account of the Issuing Bank its Pro
Rata Share of any payment on the date such payment is to be made.
(3) Whenever the Issuing Bank receives a payment on account of
a Canadian Reimbursement Obligation, including any interest thereon, as to
which the Canadian Collateral Agent has previously received payments from
the Canadian Lenders for the account of the Issuing Bank pursuant to this
SECTION 2.02(vi)(f) and the Canadian Collateral Agent has already
forwarded such payment to the Issuing Bank (so that such first mentioned
payment is duplicative), it shall promptly pay to the Canadian Collateral
Agent, and the Canadian Collateral Agent shall promptly pay to each
Canadian Lender which has funded its participating interest therein, in
Toronto, Ontario, in Canadian Dollars or US Dollars, as appropriate, and
in the kind of funds so received, an amount equal to such Canadian
Lender's Pro Rata Share thereof. Each such payment shall be made by the
Issuing Bank or the Canadian Collateral Agent, as the case may be, on the
Business Day on which such Person receives the funds paid to such Person
pursuant to the preceding sentence, if received prior to 10:00 a.m.
(Toronto, Ontario time) on such Business Day, and otherwise on the next
succeeding Business Day.
(4) The obligations of any Canadian Lender to make payments to
the Canadian Collateral Agent for the account of the Issuing Bank with
respect to a Canadian Letter of Credit issued on behalf of the Canadian
Borrower by such Issuing Bank (and the reimbursement obligations of the
Canadian Borrower in the Letter of Credit Reimbursement Agreement) shall
be irrevocable, shall not be subject to any qualification or exception
whatsoever and shall be honored in accordance with the terms and
conditions of this Loan Agreement under all circumstances (subject to the
terms, conditions and provisions of SECTION 2.02(vi)(b) above) including,
without limitation any of the following circumstances (except in
connection with the gross negligence or willful misconduct of the Issuing
Bank):
(A) any lack of validity or enforceability of this Loan
Agreement or any of the other Loan Documents;
(B) the existence of any claim, set-off , defense or
other right which the Canadian Borrower may have at any time against a
beneficiary named in a Canadian Letter of Credit or any transferee of any
Canadian Letter of Credit (or any Person for whom any such transferee may
be acting), the Canadian Collateral Agent, the Issuing Bank, any Canadian
Lender or any other Person, whether in connection with this Loan
Agreement, any Canadian Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying
transactions between the Canadian Borrower and the beneficiary named in
any Canadian Letter of Credit);
(C) any draft, certificate of any other document
presented under any Canadian Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect;
(D) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents;
(E) any failure by any Agent or the Issuing Bank to make
any reports required pursuant to SECTION 2.09(v) below; or
(F) the occurrence of any Event of Default or Potential
Event of Default.
(g) (1) The Canadian Borrower hereby unconditionally agrees to
pay to the Issuing Bank the amount of all Canadian Reimbursement
Obligations, interest and other amounts payable to the Issuing Bank under
or in connection with any Canadian Letter of Credit issued on behalf of
the Canadian Borrower immediately when due, irrespective of any claim,
set-off, defense or other right which the Canadian Borrower may have at
any time against the Issuing Bank or any other Person.
(2) In the event any payment by the Canadian Borrower received
by the Issuing Bank with respect to such Canadian Letter of Credit and
distributed by the Canadian Collateral Agent to the Canadian Lenders on
account of their participations is thereafter set aside, avoided or
recovered from the Issuing Bank in connection with any receivership,
liquidation or bankruptcy proceeding or otherwise, each Canadian Lender
which received such distribution shall, upon demand by the Issuing Bank,
contribute such Canadian Lender's Pro Rata Share of the amount set aside,
avoided or recovered together with interest at the rate required to be
paid by the Issuing Bank upon the amount required to be repaid by it.
(vii) ISSUING BANK, ADMINISTRATIVE AGENT, CANADIAN COLLATERAL AGENT
AND CANADIAN LENDERS NOT LIABLE. (a) In addition to amounts payable as elsewhere
provided in SECTION 2.02(vi) above, the Canadian Borrower hereby agrees to
protect, indemnify, pay and save the Canadian Collateral Agent, the
Administrative Agent, the Issuing Bank and each Canadian Lender harmless from
and against any and all Liabilities and Costs which the Canadian Collateral
Agent, the Administrative Agent, the Issuing Bank or any Canadian Lender may
incur or be subject to as a consequence, direct or indirect, of (1) the issuance
of a Canadian Letter of Credit for the account of the Canadian Borrower other
than, in the case of the Issuing Bank, as a result of its gross negligence or
willful misconduct, as determined by the final judgment of a court of competent
jurisdiction or (2) the failure of the Issuing Bank to honor a drawing under
such Canadian Letter of Credit as a result of any Governmental Acts.
(b) As between the Canadian Borrower and its Subsidiaries, the
Canadian Lenders, the Administrative Agent, the Canadian Collateral Agent and
the Issuing Bank, subject to the second to the last sentence of this SECTION
2.02(vii)(b), the Canadian Borrower assumes all risks of the acts and omissions
of, or misuse of such Canadian Letter of
Credit by the beneficiary of such Canadian Letter of Credit. In furtherance and
not in limitation of the foregoing, subject to the provisions of the Letter of
Credit Reimbursement Agreements, the Administrative Agent, the Canadian
Collateral Agent, the Issuing Bank and the Canadian Lenders shall not be
responsible: (1) for the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by the Canadian Borrower or the
beneficiary of such Canadian Letter of Credit in connection with the application
for and issuance of (or any draw requests under) the Canadian Letters of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (2) for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign a Canadian Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (3) for failure of the beneficiary of a
Canadian Letter of Credit to comply duly with conditions required in order to
draw upon such Canadian Letter of Credit; (4) for errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex, or other similar form of teletransmission or otherwise,
whether or not they be in cipher; (5) for errors in interpretation of technical
terms; (6) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Canadian Letter of Credit
or of the proceeds thereof; (7) for the misapplication by the beneficiary of a
Canadian Letter of Credit of the proceeds of any drawing under such Canadian
Letter of Credit; and (8) for any consequences arising from causes beyond the
control of the Administrative Agent, the Canadian Collateral Agent, the Issuing
Bank and the Canadian Lenders including, without limitation, any Governmental
Acts. None of the above shall affect, impair, or prevent the vesting of any of
the rights or powers of the Issuing Bank under this SUBPARAGRAPH (b); PROVIDED,
HOWEVER, the Canadian Borrower may have a Claim against either the
Administrative Agent, the Canadian Collateral Agent, the Issuing Bank and/or the
Canadian Lenders, to the extent of any direct, but not consequential, damages
suffered by the Canadian Borrower that were caused by such Person's willful
misconduct or gross negligence. In furtherance and not in limitation of the
foregoing, the Issuing Bank may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary.
(c) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by the
Issuing Bank under or in connection with Canadian Letters of Credit issued on
behalf of the Canadian Borrower or any related certificates, if taken or omitted
in good faith, shall not, in the absence of an express violation of the
standards set forth in the Uniform Customs and subsequent revisions thereof, put
the Issuing Bank, the Administrative Agent, the Canadian Collateral Agent or any
Canadian Lender under any resulting liability to the Canadian Borrower or
relieve the Canadian Borrower of any of its obligations hereunder to any such
Person.
SECTION 2.03 ACQUISITION/TERM LOAN FACILITY
(i) AVAILABILITY. (a) Subject to the terms and conditions set forth
in this Loan Agreement, and provided no Potential Event of Default or Event of
Default shall have occurred and be continuing, each US Lender holding an
Acquisition/Term Loan Commitment hereby SEVERALLY AND NOT JOINTLY agrees to make
available to the US Borrowers from time to time during the Acquisition/Term Loan
Period, Acquisition/Term loans (hereinafter each individually referred to as an
"Acquisition/Term Loan" and collectively as the "Acquisition/Term Loans"), in a
principal amount which shall not exceed, in the aggregate at any time
outstanding, such US Lender's Acquisition/Term Loan Commitment in effect at such
time. If the outstanding principal amount of the Acquisition/Term Loans shall
intentionally or unintentionally exceed the maximum aggregate principal amount
of the Acquisition/Term Loan Facility at any time, such excess shall be (1)
immediately payable by the US Borrowers to the US Lenders holding an
Acquisition/Term Loan Commitment, (2) secured by the Collateral and (3) subject
to the terms, conditions and provisions of this Loan Agreement. No new or
additional Acquisition/Term Loan shall be made during the Acquisition/Term Loan
Term Period, if any. Each Acquisition/Term Loan shall be evidenced by an
Acquisition/Term Loan Note with all blanks appropriately filled in made payable
to each US Lender then holding an Acquisition/Term Loan Commitment in a
principal amount equal to such US Lender's Pro Rata Share of such
Acquisition/Term Loan.
(b) All Acquisition/Term Loans under this Loan Agreement shall
be made available by the US Lenders holding an Acquisition/Term Loan Commitment
simultaneously and proportionately to their respective Pro Rata Share of the
Acquisition/Term Loan Commitments. It shall be understood that no US Lender
shall be responsible for any failure by any other US Lender to perform its
obligation to make an Acquisition/Term Loan hereunder and that the
Acquisition/Term Loan Commitment of any US Lender shall not be increased or
decreased as a result of the failure by any other US Lender to perform its
obligation to make an Acquisition/Term Loan.
(c) Acquisition/Term Loans may be voluntarily prepaid by the
US Borrowers pursuant to the terms, conditions and provisions of SECTION 2.08
hereof, but the US Borrowers MAY NOT reborrow any principal amounts repaid or
prepaid on the Acquisition/Term Loan Facility. Each US Lender's Acquisition/Term
Loan Commitment shall expire automatically on the Acquisition/Term Loan Maturity
Date. Each of the Acquisition/Term Loans shall be due and payable in full on the
date which is five (5) years from the date such Acquisition/Term Loan is made
available to the US Borrowers and shall be amortized in accordance with the
terms, conditions and provisions of SECTION 2.03(v) of this Loan Agreement.
(ii) NOTICE OF BORROWING. During the Acquisition/Term Loan Period,
whenever the US Borrowers desire to borrow under this SECTION 2.03, the US
Borrowers shall deliver to the Administrative Agent a Notice of Borrowing no
later than 10:00 a.m. (Cranford, New Jersey time) (a) at least one (1) Business
Day in advance of the proposed Borrowing Date, in the case of a Borrowing as a
Base Rate Loan and (b) at least three (3) Business Days in
advance of the proposed Borrowing Date in the case of a Borrowing as a
Eurodollar Rate Loan. The Notice of Borrowing shall specify (1) the Borrowing
Date (which shall be a Business Day) in respect of the Acquisition/Term Loan,
(2) the amount of the proposed Borrowing, (3) the intended use of the proceeds
of such Borrowing, (4) the applicable interest rate option as described in
SECTION 2.05(i) of this Loan Agreement and, if applicable, (5) the Eurodollar
Interest Period applicable thereto. In lieu of delivering the above-described
Notice of Borrowing, the US Borrowers may give the Administrative Agent
telephonic notice of any proposed Borrowing by the time required under this
SECTION 2.03(ii); PROVIDED, HOWEVER, that such notice shall be confirmed in
writing by delivery to the Administrative Agent promptly (but in no event later
than the Borrowing Date of the requested Acquisition/Term Loan) of a Notice of
Borrowing. Any Notice of Borrowing (or telephonic notice in lieu thereof)
pursuant to this SECTION 2.03(ii) shall be irrevocable. In addition, PRIOR to
submitting any Notice of Borrowing pursuant to this SECTION 2.03(ii), the US
Borrowers shall also deliver to the Administrative Agent (A) all items required
to be delivered to the Administrative Agent and/or the US Lenders under the
definition of "Permitted Acquisitions", all of which shall be satisfactory to
the Administrative Agent, in its sole and absolute discretion, and (B) a fully
executed Acquisition/Term Loan Note for each US Lender then holding an
Acquisition/Term Loan Commitment, with blanks appropriately filled in to the
Administrative Agent's satisfaction, in an amount equal to such US Lender's Pro
Rata Share of such Acquisition/Term Loan.
(iii) MAKING OF ACQUISITION/TERM LOANS. The US Lenders holding
Acquisition/Term Loan Commitments shall make the proceeds of such
Acquisition/Term Loan available to the US Borrowers at the Administrative
Agent's Office on such Borrowing Date and shall disburse such funds in dollars
and in immediately available funds to an account of the US Borrowers maintained
with Summit Bank.
(iv) USE OF PROCEEDS OF ACQUISITION/TERM LOAN FACILITY. The proceeds
of the Acquisition/Term Loan Facility shall be used by the US Borrowers for the
sole purpose of financing a portion of the purchase price of Permitted
Acquisitions and certain costs and expenses incurred by the US Borrowers in
connection therewith.
(v) AMORTIZATION OF THE ACQUISITION/TERM LOANS. The US Borrowers
shall repay to the Administrative Agent for the account of the US Lenders
holding an Acquisition/Term Loan Commitment, the outstanding principal balance
of each Acquisition/Term Loan in equal consecutive quarterly installments in an
amount equal to one-eighteenth (1/18th) of the initial principal amount of each
such Acquisition/Term Loan commencing on the first day of the second calendar
quarter following the calendar quarter in which such Acquisition/Term Loan is
made and continuing on the first day of each calendar quarter thereafter during
the term of this Loan Agreement. The final payment of all principal, unpaid
accrued interest, fees and expenses, if any, owing to the US Lenders holding
Acquisition/Term Loan Commitments in connection with the Acquisition/Term Loan
Facility and in respect to all Acquisition/Term Loans shall be due and payable
on the Acquisition/Term Loan Maturity Date.
SECTION 2.04 F/X LINE OF CREDIT FACILITY. The F/X Line of Credit Facility
shall be made available to the Canadian Borrower by Summit Bank and Mellon US
and shall be subject to the following terms, conditions and provisions:
(i) THE F/X LINE OF CREDIT FACILITY. The obligation of the Canadian
Borrower to repay all monies advanced by Summit Bank and/or Mellon US to the
Canadian Borrower in connection with the F/X Line of Credit Facility shall be
evidenced by this Loan Agreement and by the Foreign Exchange Contracts.
(ii) REPAYMENT OF AMOUNTS ADVANCED UNDER THE F/X LINE OF CREDIT
FACILITY. Amounts advanced by Mellon US and/or Summit Bank under the F/X Line of
Credit Facility shall be due and payable by the Canadian Borrower to Summit Bank
and/or Mellon US, as applicable, in accordance with the terms, conditions and
provisions of the particular Foreign Exchange Contract(s). The final payment of
all amounts advanced by Mellon US and/or Summit Bank under the F/X Line of
Credit Facility shall be accompanied by the payment of any and all unpaid
accrued interest, fees and other expenses, if any, and shall be due and payable
by the Canadian Borrower, and the F/X Line of Credit Facility shall terminate
automatically, on the F/X Line of Credit Maturity Date.
(iii) FOREIGN EXCHANGE CONTRACTS. (a) Pursuant to the terms,
conditions and provisions of this Loan Agreement, the Canadian Borrower has
appointed Summit Bank and Mellon US as its agents for the purpose of purchasing
Foreign Exchange Contracts for the Canadian Borrower's account. The Canadian
Borrower may request, which request shall be in writing, that either Summit Bank
or Mellon US, at the Canadian Borrower's option, purchase a Foreign Exchange
Contract for the account of the Canadian Borrower. If the Canadian Borrower
requests in writing that either Summit Bank and Mellon US purchase a Foreign
Exchange Contract, and provided the Canadian Borrower is otherwise entitled to
such credit extension pursuant to the terms, conditions and provisions of this
Loan Agreement, such Lender shall purchase, or cause to be purchased, for the
account of the Canadian Borrower, Foreign Exchange Contracts as requested by the
Canadian Borrower in writing and such Lender, within two (2) Business Days
thereafter, shall notify the other in writing of such request. The Lender
purchasing such Foreign Exchange Contract shall confirm each such Foreign
Exchange Contract in a writing in the form of EXHIBIT "L" attached hereto and
made a part hereof, a copy of which the Canadian Borrower hereby agrees to
acknowledge and return to such Lender immediately upon its receipt thereof. Each
Foreign Exchange Contract shall be on the terms of such confirmation and subject
to the additional specific terms set forth thereon.
(b) The Canadian Borrower hereby agrees to pay to any Lender
making any Foreign Exchange Contract available to the Canadian Borrower the
exchange price or settlement amount for such Foreign Exchange Contract in US
Dollars two (2) Business Days prior to the delivery of such currency under such
Foreign Exchange Contract, in the manner prescribed by SECTION 2.09(ii) of this
Loan Agreement. Both Summit Bank and Mellon US may
offset their respective obligations under Foreign Exchange Contracts for the
purchase of a specific foreign currency on a certain date against contracts for
the sale of such specific foreign currency on the date. Each time any Foreign
Exchange Contract is purchased for the account of the Canadian Borrower, whether
such Foreign Exchange Contract is purchased from Summit Bank or from Mellon US,
the aggregate face amount of Foreign Exchange Contracts which the Canadian
Borrower may then request under the F/X Line of Credit Facility shall be reduced
by a sum equal to such Foreign Exchange Contract (such remaining amount which
may be requested by the Canadian Borrower under the F/X Line of Credit Facility
having been already reduced by the aggregate face amount of all other Foreign
Exchange Contracts which are then outstanding) until such time as the Canadian
Borrower repays to the applicable Lender for delivery of the foreign currency so
purchased in accordance with the terms, conditions and provisions of such
Foreign Exchange Contract. In no event shall (1) the face amount of all Foreign
Exchange Contracts purchased at any one time, whether such Foreign Exchange
Contracts are purchased by Mellon US or by Summit Bank, ever exceed in the
aggregate the F/X Line of Credit Aggregate Maximum Amount, (2) Summit Bank
and/or Mellon US be obligated to purchase Foreign Exchange Contracts for the
Canadian Borrower during the sixty (60) day period of time which precedes the
F/X Line of Credit Maturity Date and/or (3) Summit Bank and/or Mellon US be
obligated to purchase any Foreign Exchange Contract for the Canadian Borrower
which expires later than the thirty (30) day period which precedes the F/X Line
of Credit Maturity Date; PROVIDED, HOWEVER, that Summit Bank and Mellon US agree
to purchase Foreign Exchange Contracts which expire later than the date which is
thirty (30) days prior to the F/X Line of Credit Maturity Date; PROVIDED THAT
(A) the Lender to whom the request to purchase such a Foreign Exchange Contract
is directed (i.e., Summit Bank or Mellon US) shall have agreed, in its sole and
absolute discretion, to purchase such Foreign Exchange Contract and (B) the
Canadian Borrower shall have deposited in an interest-bearing cash collateral
account opened by the US Collateral Agent as collateral security for such
Foreign Exchange Contract, Cash or Cash Equivalents in an amount equal to the
face amount of such Foreign Exchange Contract.
(c) The Canadian Borrower hereby acknowledges and agrees that
the obligations of Summit Bank and Mellon US under this SECTION 2.04(iii)(c) are
subject to there being a market in the foreign currency requested by the
Canadian Borrower accessible to the applicable Lender at the time of the
Canadian Borrower's request. In the event that such accessible market does not
then exist, Summit Bank and Mellon US will so notify the Canadian Borrower on or
prior to the date on which such credit extension was to become effective in
accordance with the Canadian Borrower's request and the portion of the Canadian
Borrower's request relating to the purchase of Foreign Exchange Contracts for
currency for which such accessible market does not exist shall be void and
deemed not to have been made, PROVIDED THAT the foregoing shall not affect any
request or portion of a request for a credit extension not involving the
purchase of Foreign Exchange Contracts for foreign currency for which an
accessible market does not exist.
(d) With respect to all Foreign Exchange Contracts which, on
or before the F/X Line of Credit Maturity Date, have not been presented for
honor, notwithstanding
the occurrence of the F/X Line of Credit Maturity Date and the satisfaction of
all other Obligations under the Loan Documents, the Canadian Borrower's
Obligations under the Loan Documents shall continue after the F/X Line of Credit
Maturity Date and the Liens granted under and pursuant to the Loan Documents to
secure the obligations, liabilities and responsibilities of the Canadian
Borrower under and/or in connection with the F/X Line of Credit Facility shall
continue to secure such Foreign Exchange Contracts until all amounts paid by
Summit Bank and Mellon US, as applicable, under such Foreign Exchange Contracts
have been reimbursed and until all such Foreign Exchange Contracts have expired;
PROVIDED, HOWEVER, that the Administrative Agent and the US Collateral Agent may
release the Liens under the Loan Documents (but not the other Obligations
thereunder) which secure the obligations, liabilities and responsibilities of
the Canadian Borrower under and/or in connection with the F/X Line of Credit
Facility upon (1) the deposit by the Canadian Borrower in an interest-bearing
cash collateral account opened by the US Collateral Agent, for the benefit of
Summit Bank and Mellon US in their capacity as lenders under the F/X Line of
Credit Facility, as collateral security for such Foreign Exchange Contracts, of
Cash or Cash Equivalents in an amount equal to the aggregate face amount of all
such Foreign Exchange Contracts or (2) an indemnification agreement from a
financial institution or "back-up" letters of credit issued by a financial
institution in favor of Summit Bank and/or Mellon US, as applicable, all in form
and substance reasonably satisfactory to the US Collateral Agent.
SECTION 2.05 INTEREST ON THE LOAN FACILITIES.
(i) RATES OF INTEREST. (a) All Revolving Credit Loans (other than
Canadian Bankers Acceptances which are described and provided for in SECTION
2.06 below) shall bear interest computed daily on the outstanding principal
balance thereof from the date when made until paid in full at one or more of the
interest rate options selected by the Borrowers from between the two (2)
interest rate options set forth below; PROVIDED, HOWEVER, that no Canadian
Revolving Credit Loans which are requested by the Canadian Borrower to be
denominated in Canadian Dollars may bear interest at the Eurodollar Rate Option.
Subject to the provisions of this Loan Agreement, the Borrowers may select
different options to apply simultaneously to different portions of the Revolving
Credit Loans and may select different Funding Segments to apply simultaneously
to different parts of the Eurodollar Rate Portion of the Revolving Credit Loans.
Each selection of a rate option shall apply separately and without overlap to
the Revolving Credit Loans as a class. The aggregate number of Funding Segments
applicable to the Eurodollar Rate Portion of the Revolving Credit Loans at any
time shall not exceed ten (10).
INTEREST RATE OPTIONS FOR ALL REVOLVING CREDIT LOANS:
(1) BASE RATE OPTION: A fluctuating rate per annum for each
day equal to the appropriate Base Rate, in effect from time to time (such
interest rate to change immediately upon any change in the Base Rate) PLUS
the Applicable Margin for such day; or
(2) EURODOLLAR RATE OPTION. A fluctuating rate per annum
(fixed for each day during a Eurodollar Interest Period ONLY) equal to the
Eurodollar Rate PLUS the Applicable Margin for such day. The
Administrative Agent shall give prompt notice to the US Borrowers and to
the Lenders of the Eurodollar Rate determined or adjusted in accordance
with the provisions hereof, which determination or adjustment shall be
conclusive (absent manifest error) if made in good faith. The Eurodollar
Rate shall be calculated in accordance with the Eurodollar Reserve
Percentage, if the Administrative Agent is required to hold such reserves.
The Eurodollar Option shall NOT be available for Canadian Revolving Credit
Loans denominated in Canadian Dollars.
(b) The Acquisition/Term Loans shall bear interest computed
daily on the outstanding principal balance thereof from the date made until paid
in full at one or more of the interest rate options selected by the Borrowers
from between the two (2) interest rate options set forth below. The aggregate
number of Funding Segments applicable to the Eurodollar Rate Portion of ANY
Acquisition/Term Loan at any time shall not exceed ten (10).
INTEREST RATE OPTIONS FOR ACQUISITION/TERM LOANS:
(1) BASE RATE OPTION: A fluctuating rate per annum for each
day equal to the Base Rate of the Administrative Agent, in effect from
time to time (such interest rate to change immediately upon any change in
the Base Rate) PLUS the Applicable Margin for such day; or
(2) EURODOLLAR RATE OPTION. A fluctuating rate per annum
(fixed for each day during a Eurodollar Interest Period ONLY) equal to the
Eurodollar Rate PLUS the Applicable Margin for such day. The
Administrative Agent shall give prompt notice to the US Borrowers and to
the US Lenders of the Eurodollar Rate determined or adjusted in accordance
with the provisions hereof, which determination or adjustment shall be
conclusive (absent manifest error) if made in good faith. The Eurodollar
Rate shall be calculated in accordance with the Eurodollar Reserve
Percentage, if the Administrative Agent is required to hold such reserves.
(c) The Applicable Margin for Base Rate Loans, Eurodollar Rate
Loans and Canadian Bankers Acceptances with respect to the Loan Facilities for
any day shall be the applicable percentage set forth in the Leverage Matrix
(hereinafter referred to as the "Applicable Margin"). For purposes of this
SECTION 2.05(i)(c), the Consolidated Funded Debt Leverage Ratio of Cantel
Medical and its Subsidiaries shall be tested at the end of the periods covered
by the quarterly and annual consolidated financial statements which are to be
provided to the Administrative Agent pursuant to SECTION 5.02 of the Loan
Agreement. Any change in the Applicable Margin (both increases and decreases
therein) shall be effective on the first (1st) day of the Fiscal Quarter
following the Fiscal Quarter in which the Administrative Agent is entitled to
receive said submitted financial statements all as provided for in ARTICLE V
hereof. For example, for financial statements covering the first Fiscal Quarter
of any Fiscal Year, the effective date of any increase or decrease in the
Applicable Margin would be November 1st of said calendar year.
(d) Notwithstanding SUBSECTIONS (a), (b) AND (c) above,
interest in respect of any Loan shall not exceed the maximum rate permitted by
applicable Law.
(ii) INTEREST PAYMENTS. Subject to the terms, conditions and
provisions of SECTION 2.05(iv) below, (a) interest accrued on all Base Rate
Loans in any month shall be payable by the Borrowers in arrears (1) on the last
day of each month during the term of this Loan
Agreement, commencing on the last such day following the making of each such
Base Rate Loan, (2) upon the prepayment thereof in full and (3) at maturity and
(b) interest accrued on each Eurodollar Rate Loan shall be payable by the
Borrowers in arrears (1) on each Eurodollar Interest Payment Date applicable to
that Loan, (2) upon prepayment thereof in full or (3) at maturity.
(iii) CONVERSION OR CONTINUATION. (a) Subject to the terms,
conditions and provisions of SECTION 2.10 and SECTION 2.11 hereof, the Borrowers
shall have the option (1) to convert at any time all or any part of outstanding
Loans which, in the aggregate, equal US$100,000.00 or an integral multiple of
US$50,000.00 in excess of that amount from Base Rate Loans to Eurodollar Rate
Loans; or (2) to convert at any time all or any part of the outstanding Loans
which, in the aggregate, equal US$100,000.00 or an integral multiple of
US$50,000.00 in excess of that amount from Eurodollar Rate Loans to Base Rate
Loans on the expiration date of any Eurodollar Interest Period applicable
thereto; or (3) upon the expiration of any Eurodollar Interest Period applicable
to a Borrowing of Eurodollar Rate Loans, to continue all or any portion of such
Loans equal to US$100,000.00 or an integral multiple of US$50,000.00 in excess
of that amount as Eurodollar Rate Loans of the same type, and the succeeding
Eurodollar Interest Period of such continued Loans shall commence on the
expiration date of the Eurodollar Interest Period applicable thereto; PROVIDED,
HOWEVER, that no outstanding Loan may be continued as, or be converted into, a
Eurodollar Rate Loan when any Event of Default or Potential Event of Default has
occurred and is continuing. Without limiting the generality of the foregoing
sentence, by giving a Notice of Conversion/Continuation, the Canadian Borrower
may, subject again to the terms, conditions and provisions of SECTIONS 2.10 and
2.11 hereof, elect from time to time (A) to convert the Canadian Borrower's Base
Rate Loans to Canadian Bankers Acceptances, (B) to convert the Canadian
Borrower's Base Rate Loans to Eurodollar Rate Loans in the event that such Base
Rate Loans are denominated in US Dollars or (C) to convert the Canadian
Borrower's Canadian Bankers Acceptances (on the maturity thereof) to Base Rate
Loans; PROVIDED THAT a Canadian Bankers Acceptance may be converted only on the
last day of its term. By giving a Notice of Continuation, the Canadian Borrower
may renew any of the Canadian Borrower's outstanding Canadian Bankers
Acceptances for an additional term.
(b) In the event the Borrowers shall elect to convert or
continue a Loan under this SECTION 2.05(iii), the Borrowers (or for a Canadian
Revolving Credit Loan, the Canadian Borrower) shall deliver a Notice of
Conversion/Continuation to the Administrative Agent (and, in the case of the
Canadian Borrower, to the Canadian Collateral Agent as well) no later than 10:00
A.M. (Cranford, New Jersey time) (1) at least one (1) Business Day in advance of
the proposed conversion date in the case of a conversion to a Base Rate Loan,
(2) at least two (2) Business Days in advance of a proposed conversion or
continuation/rollover into or, of Canadian Bankers Acceptances and (3) at least
three (3) Business Days in advance of the proposed conversion/continuation date
in the case of a conversion to, or a continuation of a Eurodollar Rate Loan. A
Notice of Conversion/Continuation shall specify (A) the proposed
conversion/continuation date (which shall be a Business Day), (B) the amount of
the Loan to be converted/continued, (C) the nature of the proposed
conversion/continuation, (D) in the case of a
conversion to, or continuation of, a Eurodollar Rate Loan, the requested
Eurodollar Interest Period and (E) in the case of a conversion to, or
continuation of, a Canadian Bankers Acceptance, the requested term of such
Canadian Bankers Acceptance. In lieu of delivering the above-described Notice of
Conversion/Continuation, the Borrowers may give the applicable Agent telephonic
notice of any proposed conversion/continuation by the time required under this
SECTION 2.05(iii); PROVIDED, HOWEVER, that such notice shall be confirmed in
writing by delivery to such Agent promptly (but in no event later than the
proposed conversion/continuation date) of a Notice of Conversion/Continuation.
Promptly after receipt of a Notice of Conversion/ Continuation under this
SECTION 2.05(iii) (or telephonic notice in lieu thereof), such Agent shall
notify the applicable Lenders by telex, telecopy, telegram, telephone or other
similar form of transmission, of the proposed conversion/continuation. In the
event the Borrowers fail to provide the applicable Agent with the requisite
Notice of Conversion/Continuation for a conversion to, or a continuation of, a
Loan, said affected Loan shall automatically continue as, or convert to, a Base
Rate Loan.
(c) Any Notice of Conversion/Continuation for conversion to,
or continuation of, a Loan (or telephonic notice in lieu thereof) shall be
irrevocable and the Borrowers shall be bound to convert or continue in
accordance therewith.
(iv) DEFAULT INTEREST. Notwithstanding the rates of interest
specified in SECTION 2.05(i) hereof and the payment dates specified in SECTION
2.05(ii) hereof, effective immediately upon the occurrence of any Event of
Default under SECTION 9.01 of this Loan Agreement, for as long thereafter as any
such Event of Default under SECTION 9.01 of this Loan Agreement shall be
continuing and to the extent permitted by law, the aggregate principal balance
of all Loans then outstanding and, to the extent permitted by applicable Law,
any interest payments on the Loans not paid when due, shall bear interest
payable upon demand at the Default Rate. The Borrowers hereby acknowledge that:
(a) such Default Rate is a material inducement to the Lenders to make the Loan
Facilities available to the Borrowers, (b) the Lenders would not have made the
Loan Facilities available to the Borrowers in the absence of the agreement of
the Borrowers to pay such Default Rate, (c) such Default Rate represents
compensation for increased risk to the Lenders that the Loan Facilities will not
be repaid and (d) such Default Rate is not a penalty and represents a reasonable
estimate of (1) the cost to the Agents and to the Lenders in allocating their
respective resources (both personnel and financial) to the on-going review,
monitoring, administration and collection of the Loan Facilities and (2)
compensation to the Lenders for losses that are difficult to ascertain.
(v) COMPUTATION OF INTEREST. Except as otherwise described in the
last sentence of this SECTION 2.05(v), below, interest on (a) all Base Rate
Loans shall be computed on the basis of the actual number of days elapsed in the
period during which interest accrues and a year of 365 or 366 days, as
applicable, and (b) all Eurodollar Rate Loans shall be computed on the basis of
the actual number of days elapsed in the period during which interest accrues
and a year of 360 days. In computing interest on any Loan, the date of the
making of the Loan or the
first day of a Eurodollar Interest Period, as the case may be, shall be included
and the date of payment or the expiration date of a Eurodollar Interest Period,
as the case may be, shall be excluded; PROVIDED, HOWEVER, that if a Loan is
repaid on the same day on which it is made, one day's interest shall be paid on
that Loan. For purposes of complying with the Interest Act (Canada), where any
interest is calculated pursuant to this Loan Agreement at a rate based upon a
360 day period (hereinafter referred to as the "first rate"), the yearly rate or
percentage of interest to which the "first rate" is equivalent is the "first
rate" MULTIPLIED BY the actual number of days in the applicable calendar year
DIVIDED BY 360. All interest shall be calculated using the nominal rate method
and not the effective rate method and the deemed reinvestment principle shall
not apply to such calculations.
(vi) CHANGES; LEGAL RESTRICTIONS. Except as provided in SECTION
2.10(iv) hereof with respect to certain determinations on Eurodollar Interest
Rate Determination Dates, in the event that after the date hereof (a) the
adoption of or any change in any law, treaty, rule, regulation, guideline or
determination of a court or Governmental Authority or any change in the
interpretation or application thereof by a court or Governmental Authority or
(b) compliance by any Lender with any request or directive (whether or not
having the force of law and whether or not the failure to comply therewith would
be unlawful) from any central bank or other Governmental Authority or
quasi-governmental authority:
(1) does or may impose, modify, or hold applicable, in the
determination of a Lender, any reserve, special deposit, compulsory loan, FDIC
insurance, CDIC insurance, capital allocation, capital adequacy or additional or
similar capital requirement against assets held by, or deposits or other
liabilities (including those pertaining to Letters of Credit) in or for the
account of advances or loans by, US Commitments made, Canadian Revolving Credit
Commitments made, or other credit extended by, or any other acquisition of funds
by, a Lender or any applicable lending office or Eurodollar Affiliate of such
Lender (except, with respect to Base Rate Loans, to the extent that the reserve
and FDIC insurance or CDIC insurance requirements or requirements of the Office
of the Superintendent of Financial Institutions (Canada) are reflected in the
definition of "Base Rate" and, with respect to a Eurodollar Rate Loan, to the
extent that the reserve requirements are reflected in the definition of
"Eurodollar Rate"); or
(2) does impose on such Lender any other condition materially
more burdensome in nature, extent or consequence than those in existence as of
the Closing Date;
and the result of any of the foregoing is to increase the cost to such Lender of
making, renewing or maintaining the Loans, its Canadian Revolving Credit
Commitment, its US Revolving Credit Commitment and/or its Acquisition/Term Loan
Commitment, if any, to the Borrowers or issuing for the account of any one or
more of the Borrowers any Letter of Credit or to reduce any amount receivable
thereunder or directly or indirectly reduce the effective return to any such
Lender or on the Lender's overall capital, then, in any such case, the Borrowers
shall pay to such Lender, within thirty (30) days following demand, and delivery
to the Borrowers and the Administrative
Agent of the statement described in the next sentence, such amount or amounts
(based upon an allocation thereof by such Lender to the financing transactions
contemplated by this Loan Agreement and effected by this SECTION 2.05(vi)) as
may be necessary to compensate that Lender for any such additional cost incurred
or reduced amount received. Such Lender shall deliver to the Borrowers a written
statement of the costs or reductions claimed and the basis therefor, and the
allocation made by such Lender of such costs and reductions shall be conclusive,
absent manifest error if made in good faith. If a Lender subsequently recovers
any amount previously paid by the Borrowers pursuant to this SECTION 2.05(vi),
such Lender shall, within thirty (30) days after receipt of such recovery and to
the extent permitted by applicable Law, pay to the Borrowers the amount of any
such recovery.
SECTION 2.06 CANADIAN BANKERS ACCEPTANCES.
(i)(a) ACCEPTANCE AND PURCHASE. Pursuant to the terms, conditions
and provisions of this Loan Agreement, each Canadian Lender SEVERALLY (AND NOT
JOINTLY OR JOINTLY AND SEVERALLY) agrees to the extent of its respective Pro
Rata Share of the Canadian Revolving Credit Commitments to accept and purchase
Canadian Bankers Acceptances drawn upon it by the Canadian Borrower denominated
in Canadian Dollars. The Canadian Borrower shall notify the Canadian Collateral
Agent by irrevocable written notice (hereinafter each referred to as a "Canadian
Bankers Acceptance Notice") by 10:00 A.M. (Toronto, Ontario time) two (2)
Business Days prior to the date of any Borrowing (including a conversion into or
continuation/rollover of) by way of Canadian Bankers Acceptances and the
Canadian Collateral Agent shall, in turn, notify each Canadian Lender. Each
Borrowing by way of Canadian Bankers Acceptances shall be in a minimum aggregate
face amount of C$50,000.00 and integral multiples of C$25,000.00 in excess
thereof. Each Canadian Bankers Acceptance Notice shall be in the form of EXHIBIT
"G", attached hereto and made a part hereof. In no event shall the Dollar
Equivalent of the aggregate face amount (without discount) of all outstanding
Canadian Bankers Acceptances ever exceed the difference between (1) the Dollar
Equivalent of the Maximum Amount of Canadian Revolving Credit Loans MINUS (2)
the Dollar Equivalent of the aggregate principal amount of Canadian Revolving
Credit Loans, including Canadian Bankers Acceptances, then outstanding.
(b) TERM. Bankers Acceptances shall be issued and shall mature on a
Business Day. Each Bankers Acceptance shall have a term of one (1), two (2) or
three (3) months and shall mature no later than five (5) days prior to the
Canadian Revolving Credit Termination Date and shall be in form and substance
reasonably satisfactory to the Canadian Lenders which are accepting such Bankers
Acceptance.
(c) CANADIAN BANKERS ACCEPTANCES IN BLANK. To facilitate the
acceptance of Canadian Bankers Acceptances under this Loan Agreement, the
Canadian Borrower shall, upon execution of this Loan Agreement and from time to
time as required, provide to the Canadian Collateral Agent drafts, in form
satisfactory to the Canadian Collateral Agent, duly executed and endorsed in
blank by the Canadian Borrower in quantities sufficient for each Canadian Lender
to fulfill its obligations hereunder. In addition, the Canadian Borrower hereby
appoints each
Canadian Lender as its attorney to: (1) complete the relevant parts of Canadian
Bankers Acceptances (pursuant to the Canadian Bankers Acceptance Notice) with
amount, term and other relevant details and (2) to sign and endorse on its
behalf, in handwriting or by facsimile or mechanical signature as and when
deemed necessary by such Canadian Lender, blank forms of Canadian Bankers
Acceptances. The Canadian Borrower recognizes and hereby agrees that all
Canadian Bankers Acceptances so completed, signed and/or endorsed on its behalf
by a Canadian Lender shall bind the Canadian Borrower as fully and effectively
as if signed in the handwriting of and duly issued by the proper signing
officers of the Canadian Borrower. Each Canadian Lender is hereby authorized to
issue such Canadian Bankers Acceptances endorsed in blank in such face amounts
as may be determined by such Canadian Lender provided that the aggregate amount
thereof is equal to the aggregate amount of Canadian Bankers Acceptances
required to be accepted by such Canadian Lender pursuant to SECTION 2.06(i)(e)
below. No Canadian Lender shall be responsible or liable for its failure to
accept a Canadian Bankers Acceptance if the cause of such failure is, in whole
or in part, due to the failure of the Canadian Borrower to provide duly executed
and endorsed drafts to the Canadian Collateral Agent on a timely basis nor shall
any Canadian Lender or the Canadian Collateral Agent be liable for any damage,
loss or other claim arising by reason of any loss or improper use of any such
instrument except respectively for loss or improper use arising by reason of the
gross negligence or willful misconduct of such Canadian Lender or the Canadian
Collateral Agent, its respective officers, employees, agents or representatives.
Each Canadian Lender shall maintain a record with respect to Canadian Bankers
Acceptances (1) received by it from the Canadian Collateral Agent in blank
hereunder, (2) voided by it for any reason, (3) accepted by it hereunder, (4)
purchased by it hereunder and (5) canceled at their respective maturities. Each
Canadian Lender hereby further agrees to retain such records in the manner and
for the statutory periods provided in the various Canadian provincial or federal
statutes and regulations which apply to such Canadian Lender. The Canadian
Collateral Agent and each Canadian Lender shall hold all Canadian Bankers
Acceptances endorsed in blank and delivered to them in safekeeping in the same
manner as they would hold their own property of a similar kind.
(d) EXECUTION OF BANKERS ACCEPTANCES. Drafts of the Canadian
Borrower to be accepted as Bankers Acceptances hereunder shall be duly executed
by one or more duly authorized officers on behalf of the Canadian Borrower,
subject to SECTION 2.06(i)(c) above. Notwithstanding that any Person whose
signature appears on any Canadian Bankers Acceptance as a signatory for the
Canadian Borrower may no longer be an authorized signatory for the Canadian
Borrower at the date of issuance of a Canadian Bankers Acceptance, such
signature shall nevertheless be valid and sufficient for all purposes as if such
authority had remained in force at the time of such issuance and any such
Canadian Bankers Acceptance so signed shall be binding on the Canadian Borrower.
(e) ISSUANCE OF BANKERS ACCEPTANCES. Promptly following receipt of a
Canadian Bankers Acceptance Notice, the Canadian Collateral Agent shall so
advise the Canadian Lenders of the face amount of each Canadian Bankers
Acceptance to be accepted by it and the term thereof. The aggregate face amount
of Canadian Bankers Acceptances to be
accepted by a Canadian Lender shall be determined by the Canadian Collateral
Agent by reference to the respective Pro Rata Shares of the Canadian Revolving
Credit Commitments of the Canadian Lenders, except that, if the face amount of a
Bankers Acceptance, which would otherwise be accepted by a Canadian Bank, would
not be C$100,000.00 or an integral multiple thereof, such face amount shall be
increased or reduced by the Canadian Collateral Agent in its sole and unfettered
discretion to the nearest integral multiple of C$100,000.00.
(f) ACCEPTANCES OF CANADIAN BANKERS ACCEPTANCES. Each Canadian
Bankers Acceptance to be accepted by a Canadian Lender shall be accepted at such
Canadian Lender's office as designated by such Canadian Lender from time to
time.
(g) PURCHASE OF CANADIAN BANKERS ACCEPTANCES. On the relevant date
of borrowing, each Canadian Lender hereby SEVERALLY (AND NOT JOINTLY OR JOINTLY
AND SEVERALLY) agrees to purchase from the Canadian Borrower, at the face amount
thereof discounted by the Discount Rate, any Canadian Bankers Acceptance
accepted by it and provide to the Canadian Collateral Agent, for the account of
the Canadian Borrower, the Discounted Proceeds in respect thereof after
deducting therefrom the amount of the Acceptance Fee payable by the Canadian
Borrower to such Canadian Lender under SECTION 2.06(iii) in respect of such
Canadian Bankers Acceptance.
(h) SALE OF CANADIAN BANKERS ACCEPTANCES. Each Canadian Lender may
at any time and from time to time hold, sell, rediscount or otherwise dispose of
any or all Canadian Bankers Acceptances accepted and purchased by it.
(i) WAIVER OF PRESENTMENT AND OTHER CONDITIONS. The Canadian
Borrower hereby waives presentment for payment and any other defense to payment
of any amounts due to a Canadian Lender in respect of a Canadian Bankers
Acceptance accepted by such Canadian Lender pursuant to this Agreement which
might exist by reason of such Canadian Bankers Acceptance being held, at the
maturity thereof, by such Canadian Lender in its own right. The Canadian
Borrower shall not claim or require any days of grace or require the Canadian
Collateral Agent or any Canadian Lender to claim or allow any days of grace for
the payment of any Canadian Bankers Acceptance.
(ii) REFUNDING CANADIAN BANKERS ACCEPTANCES. With respect to each
Canadian Bankers Acceptance, the Canadian Borrower, prior to the occurrence and
continuation of an Event of Default, may give irrevocable telephone or written
notice (or such other method of notification as may be agreed upon between the
Canadian Collateral Agent and the Canadian Borrower) to the Canadian Collateral
Agent at or before 2:00 P.M. (Toronto, Ontario time) two (2) Business Days prior
to the maturity date of such Canadian Bankers Acceptance followed by written
confirmation electronically transmitted to the Canadian Collateral Agent on the
same day, of the Canadian Borrower's intention to issue one or more Canadian
Bankers Acceptances on
such maturity date (hereinafter each referred to as a "Refunding Canadian
Bankers Acceptance") to provide for the payment of such maturing Canadian
Bankers Acceptance (it being understood that payments by the Canadian Borrower
and fundings by the Canadian Lenders in respect of each maturing Canadian
Bankers Acceptance and each related Refunding Canadian Bankers Acceptance shall
be made on a net basis reflecting the difference between the face amount of such
maturing Canadian Bankers Acceptance and the Discounted Proceeds (net of the
applicable Acceptance Fee) of such Refunding Canadian Bankers Acceptance). Any
deficiency or shortfall owing in respect of maturing Canadian Bankers
Acceptances, after application of the Discounted Proceeds from the Refunding
Canadian Bankers Acceptances shall be immediately due and payable by the
Canadian Borrower to the relevant Canadian Lender. Any funding on account of any
maturing Canadian Bankers Acceptance must be made at or before 12:00 NOON
(Toronto, Ontario time) on the maturity date of such Canadian Bankers
Acceptance. If the Canadian Borrower fails to give such notice, the Canadian
Borrower shall be irrevocably deemed to have requested and to have been advanced
a Canadian Revolving Credit Loan as a Base Rate Loan in the face amount of such
maturing Canadian Bankers Acceptance on the maturity date of such maturing
Canadian Bankers Acceptance from the Canadian Lender which accepted such
maturing Canadian Bankers Acceptance, which Base Rate Loan shall thereafter bear
interest as such in accordance with the provisions hereof and otherwise shall be
subject to all provisions of this Agreement applicable to Base Rate Loans until
paid in full.
(iii) ACCEPTANCE FEE. An Acceptance Fee shall be payable by the
Canadian Borrower to each Canadian Lender and each Canadian Lender shall deduct
the amount of such Acceptance Fee from the Discounted Proceeds (in the manner
specified in SECTION 2.06(i)(g) in respect of each Canadian Bankers Acceptance).
(iv) CASH COLLATERAL. Subject to the terms, conditions and
provisions of SECTION 11.05 of this Loan Agreement, upon the occurrence and
during the continuance of any Event of Default or Potential Event of Default,
and in addition to any other rights or remedies of any Canadian Lender and the
Canadian Collateral Agent hereunder (a) the Canadian Borrower shall,
notwithstanding the maturity date of outstanding Canadian Bankers Acceptances,
pay to the Canadian Collateral Agent upon demand therefor an amount equivalent
to the amount required to pay in the aggregate the undiscounted face amount of
all outstanding Canadian Bankers Acceptances which shall be deposited into a
cash collateral account with the Canadian Collateral Agent as additional
security for payment of the undiscounted face amount of such Canadian Bankers
Acceptances upon maturity thereof, and (b) any Canadian Lender or the Canadian
Collateral Agent as and by way of collateral security for the Obligations (or
such alternate arrangement as may be agreed upon by the Canadian Borrower and
such Canadian Lender or the Canadian Collateral Agent, as applicable) shall be
entitled to deposit and retain in an account to be maintained by the Canadian
Collateral Agent (bearing interest at the Canadian Collateral Agent's rates as
may be applicable in respect of other deposits of similar amounts for similar
terms) amounts which are received by such Canadian Lender or the Canadian
Collateral Agent from the Canadian Borrower hereunder or as proceeds of the
exercise of any rights or remedies of any Canadian Lender or the Canadian
Collateral Agent hereunder against the
Canadian Borrower, to the extent such amounts may be required to satisfy any
contingent or unmatured obligations or liabilities of the Canadian Borrower to
the Canadian Lenders or the Canadian Collateral Agent, or any of them hereunder,
in respect of Canadian Bankers Acceptances.
(v) MARKET DISRUPTION FOR CANADIAN BANKERS ACCEPTANCES. If any
Canadian Lender determines in good faith and acting reasonably, which
determination shall be final, conclusive and binding upon the Canadian Borrower,
and notifies the Canadian Borrower that, by reason of circumstances or changes
affecting the market for bankers acceptances it is no longer possible to
establish the Discount Rate or that the market for bankers acceptances no longer
exists, is too weak for its normal use by such Canadian Lender or is not
capable, in the normal course of business, to absorb Canadian Bankers
Acceptances accepted by such Canadian Lender pursuant to the terms, conditions
and provisions of this Loan Agreement, then:
(a) the right of the Canadian Borrower to request Canadian
Revolving Credit Loans in the form of Canadian Bankers Acceptances shall be
suspended until such Canadian Lender determines that the circumstances causing
such suspension no longer exist and such Canadian Lender so notifies the
Canadian Borrower; and
(b) any Notice of Borrowing for any Canadian Revolving Credit
Loans in the form of Canadian Bankers Acceptances which is outstanding shall be
deemed to constitute a request for a Canadian Revolving Credit Loan as a Base
Rate Loan.
(vi) NOTIFICATION OF SUSPENSION. The Canadian Lender shall promptly
notify the Canadian Borrower of the suspension of the Canadian Borrower's right
to request Canadian Revolving Credit Loans in the form of Canadian Bankers
Acceptances and of the termination of any such suspension.
(vii) DEPOSITORY BILLS AND NOTES ACT (CANADA). Canadian Bankers
Acceptances accepted or purchased by any Canadian Lender under this Loan
Agreement after clearing services as provided for in the DEPOSITORY BILLS AND
NOTES ACT (Canada) acceptable to such Canadian Lender are available may, at the
option of such Canadian Lender, be issued in the form of a "depository bill" and
deposited with a "clearing house", as each such term is defined in the
DEPOSITORY BILLS AND NOTES ACT (Canada).
(viii) AUTHORIZATION AND POWER OF ATTORNEY WITH RESPECT TO CANADIAN
BANKERS ACCEPTANCES. To facilitate the extension of Canadian Revolving Credit
Loans by way of Canadian Bankers Acceptances, the Canadian Borrower hereby
authorizes each Canadian Lender and irrevocably appoints each Canadian Lender as
the Canadian Borrower's attorney from time to time:
(a) to complete and sign, either manually or by facsimile or
mechanical signature, a draft or bill of exchange to create a Canadian Bankers
Acceptance (with,
in the Canadian Lender's sole discretion, the inscription "THIS IS A DEPOSITORY
BILL SUBJECT TO THE DEPOSITORY BILLS AND NOTES ACT");
(b) after the acceptance thereof by such Canadian Lender, to
endorse, on behalf of the Canadian Borrower, either manually or by facsimile or
mechanical signature, such Canadian Bankers Acceptance in favor of the
applicable purchaser or endorsee thereof including, in such Canadian Lender's
discretion, such Canadian Lender or a "clearing house" (within the meaning of
the Depository Bills and Notes Act);
(c) to deliver such Canadian Bankers Acceptance to such
purchaser or to deposit such Canadian Bankers Acceptance with such clearing
house; and
(d) to comply with the procedures and requirements established
from time to time by such Canadian Lender or such clearing house in respect of
the delivery, transfer and collection of bankers acceptances and depository
bills in relation to each Canadian Bankers Acceptance accepted by the Canadian
Lender under this Loan Agreement.
All Canadian Bankers Acceptances so completed, signed, endorsed, delivered or
deposited by such Canadian Lender on behalf of the Canadian Borrower shall be
binding on the Canadian Borrower as if completed, signed, endorsed, delivered or
deposited by the Canadian Borrower. The records of such clearing house shall, in
the absence of manifest error, be conclusively binding on the Canadian Borrower.
No Canadian Lender shall be liable for any claim arising by reason of any loss
or improper use of such drafts or Canadian Bankers Acceptances or any actions or
omissions by any such clearing agency except for damages suffered by the
Canadian Borrower caused by the intentional misconduct or gross negligence of
such Canadian Lender. The Canadian Borrower shall, at the request of such
Canadian Lender, promptly become a participant (as defined by the Depository
Bills and Notes Act) for purposes of the issuance, acceptance, endorsement,
delivery, deposit and transfer of Canadian Bankers Acceptances.
SECTION 2.07 FEES.
(i) UNUSED COMMITMENT FEES. (a) From and after the Closing Date
until the Obligations are paid in full and the US Revolving Credit Commitments
are terminated, the US Borrowers shall pay to the Administrative Agent, for the
ratable accounts of the applicable US Lenders according to their Pro Rata Shares
of the US Revolving Credit Loan Facility, an unused commitment fee accruing at a
rate per annum equal to the Unused Commitment Fee Rate in effect from time to
time MULTIPLIED BY the average daily amount of the excess of the US Revolving
Credit Commitments over the Dollar Equivalent of all US Revolving Credit Loans
and US Letter of Credit Obligations outstanding from time to time.
(b) From and after the Closing Date until the Obligations are
paid in full and the Canadian Revolving Credit Commitments are terminated, the
Canadian Borrower shall pay to the Canadian Collateral Agent, for the ratable
accounts of the applicable Canadian
Lenders according to their Pro Rata Shares of the Canadian Revolving Credit Loan
Facility, an unused commitment fee accruing at a rate per annum equal to the
Unused Commitment Fee Rate in effect from time to time MULTIPLIED BY the average
daily amount of the excess of the Canadian Revolving Credit Commitments over the
Dollar Equivalent of all Canadian Revolving Credit Loans and Canadian Letter of
Credit Obligations outstanding from time to time.
(c) All such unused commitment fees payable under this SECTION
2.07(i) shall be payable quarterly in arrears on the last day in each calendar
quarter beginning after the Closing Date.
(d) In the event of the occurrence of an Event of Default and
the Administrative Agent, on behalf of the Lenders, terminates the Commitments,
then the Borrowers' respective obligations to pay the unused commitment fees
described in SECTION 2.05(i) above shall automatically terminate as of the date
of said termination by the Administrative Agent; PROVIDED, HOWEVER, the
Borrowers shall remain fully liable for any and all previously accrued but
unpaid unused commitment fees.
(ii) LETTER OF CREDIT FEES. (a) The US Borrowers shall pay to the
Administrative Agent, for the account of the applicable Issuing Bank(s), in
connection with the issuance, negotiation, termination, draw under, transfer of
and any other related US Letter of Credit activity, the customary fees as are
established from time to time by the Issuing Bank(s) in connection with US
Letters of Credit, including, without limitation, the fees for the issuance,
administration, amendment, payment or cancellation of any US Letter of Credit,
all of which fees are more fully set forth on SCHEDULE 2.07(ii), as such fees
may be revised from time to time. Except for the letter of credit annual fee
described on SCHEDULE 2.07(ii), all such fees shall be payable SOLELY for the
account of the applicable Issuing Bank(s). The letter of credit annual fee
described on SCHEDULE 2.07(ii) in connection with US Letters of Credit is (1) to
be paid by the US Borrower for whose account a particular US Letter of Credit is
issued, (2) to be equal to the product of (A) the applicable percentage set
forth on the Leverage Matrix MULTIPLIED BY (B) the face amount of such US Letter
of Credit, (3) to be paid at the time such US Letter of Credit is issued, (4)
NON-REFUNDABLE and (5) once paid by the applicable US Borrower to the
Administrative Agent, to be paid by the Administrative Agent to the US Lenders,
based upon their respective US Revolving Credit Commitments.
(b) The Canadian Borrowers shall pay to the Canadian
Collateral Agent, for the account of the applicable Issuing Bank(s) in
connection with the issuance, negotiation, termination, draw under, transfer of
and any other related Canadian Letter of Credit activity, the customary fees as
are established from time to time by the Issuing Bank(s) in connection with
Canadian Letters of Credit, including, without limitation, the fees for the
issuance, administration, amendment, payment or cancellation of any Canadian
Letter of Credit, all of which fees are more fully set forth on SCHEDULE
2.07(ii), as such fees may be revised from time to time. The letter of credit
annual fee described on SCHEDULE 2.07(ii) and charged in
connection with Canadian Letters of Credit is (1) to be paid by the Canadian
Borrower for whose account a particular Canadian Letter of Credit is issued, (2)
to be equal to the product of (A) the applicable percentage set forth on the
Leverage Matrix MULTIPLIED BY (B) the face amount of such Canadian Letter of
Credit, (3) to be paid at the time such Canadian Letter of Credit is issued, (4)
NON-REFUNDABLE and (5) once paid by the Canadian Borrower to the Canadian
Collateral Agent, to be paid by the Canadian Collateral Agent to the Canadian
Lenders, based upon their respective Canadian Revolving Credit Commitments.
(iii) LATE CHARGE FEE. In the event that any payment, including,
without limitation, interest or principal, required to be made by the Borrowers
under the Notes or under this Loan Agreement shall not be received by any Agent
within fifteen (15) days of when due, such Agent, on behalf of the applicable
Lenders, may charge, and if so charged, the Borrowers shall pay, a late charge
of (US$0.05) for each dollar (US$1.00) of each delinquent payment for the
purpose of defraying the expense incident to the handling of such delinquent
payment. In no event shall said late charge fee be less than Twenty-Five and
00/100 (US$25.00) Dollars or more than Twenty-Five Hundred and 00/100
(US$2,500.00) Dollars.
(iv) ADMINISTRATIVE AGENT'S FEE. The Borrowers shall pay to the
Administrative Agent, for the Administrative Agent's own account and not for the
Lenders, an annual fee in the amount of US$10,000.00.
(v) PAYMENT OF FEES. The fees described in this SECTION 2.07
represent compensation for services rendered and to be rendered separate and
apart from the lending of money or the provision of credit and do not constitute
compensation for the use, detention or forbearance of money, and the obligation
of the Borrowers to pay each fee described herein shall be in addition to, and
not in lieu of, the obligation of the Borrowers to pay interest, other fees and
expenses otherwise described in this Loan Agreement. Fees shall be payable when
due in Cranford, New Jersey and/or Toronto, Ontario, as applicable, in
immediately available funds. All fees shall be non-refundable when paid, except
as may be otherwise expressly provided in this Loan Agreement. All fees and
expenses specified or referred to in this Loan Agreement due and owing to the
Administrative Agent or to a Lender, including, without limitation, those
referred to in this SECTION 2.07 and in SECTION 11.03 hereof shall bear
interest, if not paid when due, at the Default Rate (but not to exceed the
maximum rate permitted by applicable Law), shall constitute Obligations and
shall be secured by all of the Collateral. All fees described in this SECTION
2.07 which are expressed as a per annum charge shall be calculated on the basis
of the actual number of days elapsed in a 365-day year.
SECTION 2.08 PREPAYMENTS.
(i) VOLUNTARY PREPAYMENTS OF THE LOANS. The Borrowers may, upon not
less than two (2) Business Days' prior written or telephonic notice confirmed
promptly in writing to the Administrative Agent (which notice the Administrative
Agent shall promptly transmit by telegram, telecopy or telephone to the Canadian
Collateral Agent, in the case of a prepayment of
a Canadian Revolving Credit Loan, and to each Lender holding a US Revolving
Credit Commitment, a Canadian Revolving Credit Commitment or an Acquisition/Term
Loan Commitment, as applicable), at any time and from time to time, prepay any
Revolving Credit Loan or Acquisition/Term Loan which is being maintained as a
Base Rate Loan in whole or in part, in an aggregate minimum amount of
US$50,000.00 and integral multiples of US$10,000.00 in excess of that amount;
PROVIDED THAT, any principal prepayment of a Revolving Credit Loan or an
Acquisition/Term Loan shall be accompanied, if required by the particular
Lenders whose Loan(s) are being prepaid, by the payment of all unpaid accrued
interest due and owing on said Loan. The Borrowers may, upon not less than five
(5) Business Days' prior written or telephonic notice confirmed promptly in
writing to the Administrative Agent (which notice the Administrative Agent shall
promptly transmit by telegram, telecopy or telephone to the Canadian Collateral
Agent, in the case of a prepayment of a Canadian Revolving Credit Loan, and to
each Lender holding a US Revolving Credit Commitment, a Canadian Revolving
Credit Commitment or an Acquisition/Term Loan Commitment, as applicable), at any
time and from time to time, prepay any Revolving Credit Loan or Acquisition/Term
Loan which is being maintained as a Eurodollar Rate Loans in whole or in part,
in an aggregate minimum amount of US$50,000.00 and integral multiples of
US$10,000.00 in excess of that amount, on the expiration date of the Eurodollar
Interest Period applicable thereto and otherwise only upon payment of (a) the
amounts described in SECTION 2.10(vi) hereof and (b) all unpaid accrued interest
due and owing on said Loan. Notwithstanding the foregoing, in the event that any
prepayments are made in connection with the termination of this Loan Agreement,
such prepayments shall be made only upon five (5) Business Days' prior written
notice to the Administrative Agent. Any notice of prepayment given to the
Administrative Agent under this SECTION 2.08(i) shall specify the date of
prepayment and the aggregate principal amount of the prepayment. All voluntary
prepayments of the Loans shall be applied in the inverse order of maturity.
(ii) MANDATORY PREPAYMENT OF THE LOANS. (a) The US Borrowers shall
make, in addition to the required quarterly principal payments on the
Acquisition/Term Loan Facility described in SECTION 2.02(v) hereof, a mandatory
prepayment of the Acquisition/Term Loan Facility (except as otherwise provided
for in SECTION 2.08(ii)(b) and SECTION 2.08(ii)(c) below):
(1) once each year, in an amount equal to the product of (A)
the Mandatory Prepayment Percentage in effect from time to time
MULTIPLIED BY (B) the Excess Cash Flow for the prior Fiscal Year.
The Excess Cash Flow shall be determined from the annual financial
statements to be delivered to the Administrative Agent pursuant to
SECTION 5.02 of this Loan Agreement. The mandatory prepayment of
principal, if any, shall be made on or before December 15th of each
Fiscal Year, with the first payment due and owing on December 15,
2001 for the prior 2001 Fiscal Year (which Fiscal Year ends on July
31, 2001); and
(2) from time to time as Properties are damaged, destroyed or
condemned in an amount equal to the net insurance or condemnation
proceeds /
award (each to the extent that such net insurance or condemnation
proceeds / award are not reinvested by the US Borrowers in similar
Properties within twelve (12) months of the receipt of net proceeds
from the damage, destruction or condemnation); and
(3) within ten (10) calendar days of any US Borrower's receipt
of any of the net proceeds described in CLAUSE (B) below, in an
amount equal to the product of (A) the Mandatory Prepayment
Percentage in effect from time to time MULTIPLIED BY (B) the net
proceeds obtained by the Borrowers from the issuance of equity as
permitted under the terms of ARTICLE VII of this Loan Agreement,
EXCLUDING, HOWEVER, (I) net proceeds realized from the conversion of
Consolidated Subordinated Debt of the Borrowers into equity of the
Borrowers, (II) net proceeds obtained by the Borrowers from the
issuance of additional equity where such equity is used SOLELY for
acquisitions permitted under SECTION 7.05 of this Loan Agreement and
(III) net proceeds obtained by the Borrowers from the exercise of
any stock options held by any director, employee or member of senior
management of such Borrower where such resulting net proceeds (x)
are less than or equal to US$50,000.00 in connection with any such
exercise and (y) are less than or equal to US$250,000.00 in the
aggregate when taken together with all other such exercises which
have occurred during the term of the Acquisition/Term Loan Facility.
(b) All mandatory prepayments of the Acquisition/Term Loan
Facility shall be applied in the inverse order of maturity until the
Acquisition/Term Loan Facility has been repaid in full. Upon the repayment in
full of the Acquisition/Term Loan Facility, all net proceeds obtained by the
Borrowers in the manner set forth in SECTION 2.08(ii)(a)(1), (2) AND (3) above
shall be applied towards the repayment of the outstanding principal balance of
the US Revolving Credit Loan Facility and the Canadian Revolving Credit Loan
Facility based on the ratio of each Lender's Revolving Credit Commitment to all
of the Revolving Credit Commitments.
(c) To the extent of any remaining monies available under
SECTION 2.08(ii)(a) AND (b) above, after repayment in full of the Loan
Facilities, all such monies shall be the sole property of the Borrowers, and the
Agents and the Lenders shall have no rights or interests therein.
SECTION 2.09 PAYMENTS; COLLECTION OF ACCOUNTS.
(i) COLLECTION OF ACCOUNTS. The Borrowers are authorized to collect
the Accounts and any other proceeds of Collateral on behalf of and in trust for
the Administrative Agent, the other Agents and the Lenders, at the Borrowers'
expense, but such authority shall automatically terminate upon the occurrence of
an Event of Default. The US Collateral Agent and/or the Canadian Collateral
Agent, as applicable, may modify or terminate such authority at
any time upon the occurrence of an Event of Default and directly collect the
Accounts and other monetary obligations included in the Collateral. The
Borrowers shall, at the Borrowers' expense and in the manner requested by the US
Collateral Agent and/or the Canadian Collateral Agent, as applicable, from time
to time, direct that remittances and all other proceeds of Accounts and other
Collateral shall be delivered to the US Collateral Agent and/or the Canadian
Collateral Agent, as applicable, pursuant to the terms of the Collateral
Documents.
(ii) MANNER AND TIME OF PAYMENT. (a) All payments of (1) principal,
interest and/or fees in connection with the US Revolving Credit Loan Facility,
the Acquisition/Term Loan Facility and/or the F/X Line of Credit Facility,
including, without limitation, those in connection with US Reimbursement
Obligations, US Letters of Credit, Foreign Exchange Contracts and/or any Swap
Obligations, which are payable to the Administrative Agent, the US Collateral
Agent and/or any of the US Lenders and (2) fees in connection with the Canadian
Revolving Credit Loan Facility which are payable to the Administrative Agent,
shall all be made without condition or reservation or right, in the applicable
currency and in immediately available funds, delivered to the Administrative
Agent not later than 10:00 A.M. (Cranford, New Jersey time) on the date due, to
such account of the Administrative Agent at the Administrative Agent's Office
for the account of the applicable US Lenders and (b) all payments of principal,
interest and/or fees in connection with the Canadian Revolving Credit Loan
Facility, including, without limitation, those in connection with Canadian
Reimbursement Obligations, Canadian Letters of Credit and/or Canadian Bankers
Acceptances, shall be payable to the Canadian Collateral Agent and/or the
Canadian Lenders shall be without condition or reservation or right, in the
applicable currency and in immediately available funds, delivered to the
Canadian Collateral Agent not later than 10:00 A.M. (Toronto, Ontario time) on
the date due, to such account of the Canadian Collateral Agent at the Canadian
Collateral Agent's principal office in Toronto, Ontario for the account of the
applicable Canadian Lenders. Funds received by the Administrative Agent and/or
the Canadian Collateral Agent, as applicable, after that time and date shall be
deemed to have been paid on the next succeeding Business Day. A monthly and/or
quarterly invoice, as applicable, shall be sent by (A) with respect to the US
Revolving Credit Loan Facility, the Acquisition/Term Loan Facility, the F/X Line
of Credit Facility and/or the Master Agreement, the Administrative Agent and (B)
with respect to the Canadian Revolving Credit Loan Facility, the Canadian
Collateral Agent, to the applicable Borrowers reflecting the accrued interest
due and owing and all fees due and owing hereunder. The US Borrowers hereby
agree that on the Business Day that any payment of principal, interest and fees
are due, the Administrative Agent shall automatically charge a demand deposit
account of the US Borrowers, which account shall be maintained with the
Administrative Agent at all times throughout the term of the Loan Facilities.
The US Borrowers' authorization of the Administrative Agent to charge such
account having sufficient funds on deposit shall constitute payment of the
amount so authorized notwithstanding the Administrative Agent's failure to
charge said account. The Canadian Borrower hereby agrees that on the Business
Day that any payment of principal, interest and fees are due, the Canadian
Borrower shall make payment of such amounts, in immediately available funds, at
the Toronto, Ontario office of the Canadian Collateral Agent or at such other
office as the Canadian Collateral Agent may designate from time to time in
writing to the Canadian
Borrower. Any failure or delay by any Agent in submitting invoices for interest
and fee payments shall not discharge or relieve the US Borrowers of the
obligation to make such payments into the demand deposit account nor shall it
discharge or relieve the Canadian Borrower of the obligation to make such
payments. All payments actually received by the Administrative Agent and/or the
Canadian Collateral Agent pursuant to the terms, conditions and provisions of
the Loan Documents for the account of the applicable Lenders shall be paid to
them promptly after receipt thereof by such Agent.
(iii) APPORTIONMENT OF PAYMENTS. So long as there does not exist an
Event of Default, all payments of principal and interest in respect of
outstanding Loans, all payments of the fees described herein and all payments in
respect of any other obligation (other than any fees payable by the US Borrowers
solely to the Administrative Agent under the Master Agreement and other than
amounts payable by the Canadian Borrower solely to Mellon US and Summit Bank
under the F/X Line of Credit Facility) shall be allocated amongst the Agents and
the Lenders as each of them may be entitled thereto as provided for herein.
After the occurrence and during the continuance of an Event of Default, the
Administrative Agent and/or the Canadian Collateral Agent, as applicable, unless
otherwise directed by the Requisite Lenders, shall apply all payments remitted
to such Agent and all amounts and proceeds of Collateral received by such Agent
in accordance with the terms, conditions and provisions of SECTION 9.03 of this
Loan Agreement.
The Administrative Agent and/or the Canadian Collateral Agent, as
applicable, shall promptly distribute to each Lender at its primary address set
forth on the appropriate signature page hereof, or at such other address as a
Lender may request in writing, such funds as it may be entitled to receive;
PROVIDED THAT no such Agent shall in any event be bound to inquire into or
determine the validity, scope or priority of any interest or entitlement of any
Lender and may suspend all payments or seek appropriate relief (including,
without limitation, instructions from the Requisite Lenders or an action in the
nature of an interpleader) in the event of any doubt or dispute as to any
apportionment or distribution contemplated hereby. The order of priority herein
is set forth solely to determine the rights and priorities of the Lenders as
among themselves and at any time or from time to time may be changed by the
Lenders as they may elect, in writing in accordance with the provisions of
SECTION 11.08 hereof, without necessity of notice to or consent of or approval
by the Borrowers or any other Person.
(iv) PAYMENTS ON NON-BUSINESS DAYS. Whenever any payment to be made
by the Borrowers hereunder shall be stated to be due on a day which is not a
Business Day, payments shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the payment of
interest hereunder (at the otherwise applicable rate) and of any of the fees
specified in SECTION 2.07 hereof, as the case may be.
(v) AGENTS' OR LENDER'S ACCOUNTING. The Administrative Agent and the
Canadian Collateral Agent, as applicable, shall maintain a loan account
(hereinafter referred to as the "Loan Account") on its respective books in which
shall be recorded (a) the names and
addresses of the Lenders and the US Revolving Credit Commitment, Canadian
Revolving Credit Commitments and Acquisition/Term Loan Commitments of each
Lender, as applicable, from time to time; (b) all other appropriate debits and
credits as provided in this Loan Agreement, including, without limitation, all
interest, fees, expenses, charges and other Obligations; and (c) all payments of
Obligations made by the Borrowers, or for the Borrowers' account. All entries in
the Loan Account shall be made in accordance with such Agent's customary
accounting practices as in effect from time to time. Each of the Administrative
Agent and the Canadian Collateral Agent will render a statement of the Loan
Account monthly to the Borrowers and will deliver a copy thereof to each Lender.
The Administrative Agent will notify each US Lender monthly if any US Letter of
Credit Obligations with respect to US Letters of Credit issued by the Issuing
Bank are outstanding on such date, and the principal amount of such US Letter of
Credit Obligation owing to each US Lender on such date. The Canadian Collateral
Agent will notify each Canadian Lender monthly if any Canadian Letter of Credit
Obligations with respect to Canadian Letters of Credit issued by the Issuing
Bank are outstanding on such date, and the principal amount of such Canadian
Letter of Credit Obligation owing to each Canadian Lender on such date. Each and
every such statement shall be deemed final, binding and conclusive upon the
Borrowers and the Lenders in all respects as to all matters reflected therein
(if made in good faith, absent manifest error), unless the Borrowers or any
Lender, within twenty (20) days after the date such statement is rendered,
delivers to the Administrative Agent and/or the Canadian Collateral Agent, as
appropriate, written notice of any objection which the Borrowers or such Lender
may have to any such statement. In that event, only those items expressly
objected to in such notice shall be deemed to be disputed by the Borrowers or
the Lenders and all of the Administrative Agent's and/or the Canadian Collateral
Agent's other entries in the Loan Account evidencing Loans, Letters of Credit
and other financial accommodations made from time to time shall be final,
binding and conclusive upon the Borrowers and the Lenders (if made in good
faith, absent manifest error) as to the existence and amount of the Obligations
recorded in the Loan Account.
SECTION 2.10 SPECIAL PROVISIONS GOVERNING EURODOLLAR RATE LOANS.
Notwithstanding other provisions of this Loan Agreement to the contrary, if any,
the following provisions shall govern with respect to Eurodollar Rate Loans as
to the matters covered:
(i) AMOUNT OF EURODOLLAR RATE LOANS. Each Eurodollar Rate Loan shall
be for a minimum amount of US$50,000.00 and in integral multiples of
US$10,000.00 in excess of that amount.
(ii) DETERMINATION OF EURODOLLAR INTEREST PERIOD. By giving notice
as set forth in SECTION 2.01(ii), SECTION 2.02(ii) and SECTION 2.05(iii) hereof
(with respect to a conversion into or a continuation of Eurodollar Rate Loans),
the Borrowers shall have the option, subject to the other provision of this
SECTION 2.10, to specify an Eurodollar Interest Period to apply to the Borrowing
of Eurodollar Rate Loans described in such notice, subject to availability. The
determination of Eurodollar Interest Periods shall be subject to the following
provisions:
(a) In the case of immediately successive Eurodollar Interest
Periods applicable to a Borrowing of Eurodollar Rate Loans, each successive
Eurodollar Interest Period shall commence on the day on which the next preceding
Eurodollar Interest Period expires;
(b) If any Eurodollar Interest Period would otherwise expire
on a day which is not a Business Day, the Eurodollar Interest Period shall be
extended to expire on the next succeeding Business Day; PROVIDED, HOWEVER, that
if any such Eurodollar Interest Period applicable to a Borrowing of Eurodollar
Rate Loans would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in that month, that
Eurodollar Interest Period Shall expire on the immediately preceding Business
Day;
(c) The Borrowers may not select a Eurodollar Interest Period
which terminates later than (1) February 22, 2004, with respect to any US
Revolving Credit Loan and/or any Canadian Revolving Credit Loan denominated in
Dollars and (2) February 22, 2008, with respect to any Acquisition/Term Loan;
(d) The Borrowers may not select a Eurodollar Interest Period
with respect to any portion of principal of a Eurodollar Rate Loan which extends
beyond a date on which the Borrowers are required to make a scheduled payment of
any portion of principal, it being understood and agreed that any Eurodollar
Rate Loan whose Eurodollar Interest Period ends less than one month prior to
such required principal payment date shall be deemed converted to a Base Rate
Loan as of the last day of such Eurodollar Interest Period for purposes of
determining whether any portion of principal of any Eurodollar Rate Loan is
required in order to make a mandatory payment of principal;
(e) There shall be no more than ten (10) Eurodollar Interest
Periods under this Loan Agreement in effect at any one time; and
(f) No Canadian Revolving Credit Loan denominated in Canadian
Dollars may bear interest at the Eurodollar Rate.
(iii) DETERMINATION OF INTEREST RATE. As soon as practicable after
10:00 a.m. (Cranford, New Jersey time) or, with respect to Canadian Revolving
Credit Loans, 10:00 A.M. (Toronto, Ontario time) on any Eurodollar Interest Rate
Determination Date, the Administrative Agent or, with respect to Canadian
Revolving Credit Loans, the Canadian Collateral Agent shall determine (which
determination shall, absent manifest error, be presumptively correct) the
interest rate which shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Eurodollar Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to the Borrowers and to each Lender.
(iv) INTEREST RATE UNASCERTAINABLE, INADEQUATE OR UNFAIR. If, with
respect to any Eurodollar Interest Period, the Administrative Agent, or, with
respect to Canadian Revolving
Credit Loans, the Canadian Collateral Agent, or any Lender determines that (a)
deposits in Dollars (in the applicable amounts) are not being offered in the
relevant market for such Eurodollar Interest Period; (b) adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate; (c) a contingency has
occurred which materially and adversely affects the London interbank Eurodollar
market as a whole; or (d) the effective cost to such Lender of funding a
proposed Funding Segment of the Eurodollar Portion from a corresponding source
of funds in the London interbank eurodollar market shall exceed the Eurodollar
Rate, applicable to such Funding Segment, the Administrative Agent or, with
respect to Canadian Revolving Credit Loans, the Canadian Collateral Agent shall
forthwith give notice thereof to the Borrowers, whereupon until the
Administrative Agent or, with respect to Canadian Revolving Credit Loans, the
Canadian Collateral Agent notifies the Borrowers that the circumstances giving
rise to such suspension no longer exist, (1) the right of the Borrowers to elect
to have Loans bear interest based upon the Eurodollar Rate shall be suspended
and (2) each outstanding Eurodollar Rate Loan shall be converted into a Base
Rate Loan on the last day of the then current Eurodollar Interest Period
therefor, notwithstanding any prior election by the Borrowers to the contrary.
(v) ILLEGALITY. (a) In the event that on any date any Lender shall
have determined (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties) that the making or continuation of any
Eurodollar Rate Loan has become unlawful by compliance by that Lender in good
faith with any Law of any Governmental Authority (whether or not having the
force of Law and whether or not failure to comply therewith would be unlawful),
then, and in any such event, such Lender shall promptly give notice (by
telephone promptly confirmed in writing) to the Borrowers and the Administrative
Agent or, with respect to Canadian Revolving Credit Loans, the Canadian
Collateral Agent (which notice the Administrative Agent or, with respect to
Canadian Revolving Credit Loans, the Canadian Collateral Agent shall promptly
transmit to each Lender) of that determination.
(b) Upon the giving of the notice referred to in SECTION
2.10(v)(a) above, (1) the Borrowers' right to request of such Lender and such
Lender's obligation to make Eurodollar Rate Loans shall be immediately
suspended, and such Lender shall make a Loan, as part of any requested Borrowing
of Eurodollar Rate Loans, as a Base Rate Loan, which Base Rate Loan shall, for
all purposes, be considered a part of such Borrowing, and (2) if the affected
Eurodollar Rate Loan(s) are then outstanding, the Borrowers shall immediately
(or, if permitted by applicable Law, no later than the date permitted thereby,
upon at least one (1) Business Day's written notice to the Administrative Agent
or, with respect to Canadian Revolving Credit Loans, the Canadian Collateral
Agent and the affected Lender) convert each such Loan into a Base Rate Loan.
(c) In the event that such Lender determines at any time
following its giving of the notice referred to in SECTION 2.10(iv) and/or
SECTION 2.10(v)(a) above that such Lender may lawfully make Eurodollar Rate
Loans of the type referred to in such notice, such Lender shall promptly give
notice (by telephone confirmed in writing) to the Borrowers and the
Administrative Agent or, with respect to Canadian Revolving Credit Loans, the
Canadian
Collateral Agent (which notice the Administrative Agent or, with respect to
Canadian Revolving Credit Loans, the Canadian Collateral Agent shall promptly
transmit to each Lender) of that determination, whereupon the Borrowers' right
to request of such Lender, and such Lender's obligation to make, Eurodollar Rate
Loans shall be restored.
(vi) COMPENSATION. In addition to such amounts as are required to be
paid by the Borrowers pursuant to SECTIONS 2.05(i), 2.05(iv) and 2.05(vi) above,
the Borrowers shall compensate each Lender, upon demand, for any and all losses,
expenses and liabilities (including, without limitation, any loss or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
required by such Lender to fund or maintain such Lender's Eurodollar Rate Loans
to the Borrowers) which losses, expenses and liabilities such Lender sustains or
would sustain (a) if for any reason, other than the gross negligence or willful
misconduct of the Administrative Agent or, with respect to Canadian Revolving
Credit Loans, the Canadian Collateral Agent or such Lender, a Borrowing,
conversion or continuation of Eurodollar Rate Loans does not occur on a date
specified therefor in a Notice of Borrowing or a Notice of
Conversion/Continuation or in a telephonic request for borrowing or
conversion/continuation or a successive Eurodollar Interest Period does not
commence after notice therefor is given pursuant to SECTION 2.05(iii) above, (b)
if any prepayment of a Eurodollar Rate Loan (including, without limitation, any
prepayment pursuant to SECTION 2.08 above) occurs for any reason on a date which
is not the last day of the applicable Eurodollar Interest Period, (c) as a
consequence of any required conversion of a Eurodollar Rate Loan to a Base Rate
Loan as a result of any of the events indicated in SECTION 2.10(v) above or (d)
as a consequence of any other failure by the Borrowers (other than the failure
of the Administrative Agent or, with respect to Canadian Revolving Credit Loans,
the Canadian Collateral Agent to charge any account having sufficient funds as
authorized by the Borrowers pursuant to SECTION 2.10(ii) above) to repay
Eurodollar Rate Loans when required by the terms of this Loan Agreement. Such
Lender shall deliver to the Borrowers a written statement as to such losses,
expenses and liabilities which statement shall be conclusive as to such amounts
in the absence of manifest error. The Borrowers' responsibility to pay such
amounts shall be absolute regardless of whether any such Lender actually
obtained funds for any such Eurodollar Rate Loans from the London interbank
eurodollar market.
(vii) EURODOLLAR RATE TAXES. The Borrowers hereby covenant and agree
that:
(a) provided the Borrowers shall have received a written
request therefor, together with a certificate setting forth the basis therefor
and calculation thereof, the Borrowers will pay, on the later of (1) thirty (30)
days following its receipt of such request and certificate or (2) the Business
Day immediately prior to the date upon which penalties attach thereto, all
present and future stamp and other taxes, levies, or costs and charges
whatsoever imposed, assessed, levied or collected on or in respect of a Loan
solely as a result of the interest rate being determined by reference to the
Eurodollar Rate or the provisions of this Loan Agreement relating to the
Eurodollar Rate or the recording, registration, notarization or other
formalization of any thereof or any payments of principal, interest or other
amounts made on or
in respect of a Loan made to the Borrowers when the interest rate is determined
by reference to the Eurodollar Rate (all such taxes, levies, costs and charges
shall be hereinafter collectively referred to as the "Eurodollar Rate Taxes"),
excluding any of the foregoing arising out of the gross negligence or willful
misconduct of any Lender; PROVIDED, however, that Eurodollar Rate Taxes shall
not include net income or franchise taxes imposed by any Governmental
Authorities. The Borrowers shall also pay such additional amounts equal to
increases in Eurodollar Rate Taxes attributable to payments made by the
Borrowers pursuant to this CLAUSE (A). Promptly after the date on which payment
of any such Eurodollar Rate Tax is due pursuant to the preceding sentence, the
Borrowers will, at the request of such Lender, furnish to such Lender evidence,
in form and substance satisfactory to such Lender, that the Borrowers have met
their obligation under this SECTION 2.10(vii); and
(b) the Borrowers will indemnify each Lender against, and
reimburse each Lender on demand for, any Eurodollar Rate Taxes paid by such
Lender in respect of a Loan made to the Borrowers, as determined by such Lender
in its reasonable business judgment, PROVIDED THAT the Lender shall have
provided the Borrowers with (1) appropriate receipts for any payments or
reimbursements made by the Borrowers pursuant to this CLAUSE (b) and (2) such
information as may reasonably be required to indicate the basis for such
Eurodollar Rate Taxes; PROVIDED, HOWEVER, that if a Lender subsequently
recovers, or receives a net tax benefit with respect to, any amount of
Eurodollar Rate Taxes previously paid or indemnified by the Borrowers pursuant
to this SECTION 2.10(vii)(a) OR (b), such Lender shall, within thirty (30) days
after receipt of such refund, and to the extent permitted by applicable Law, pay
to the Borrowers the amount of any such recovery or net tax benefit. The amount
of Eurodollar Rate Taxes due pursuant to the provisions of this SECTION 2.10(b)
shall only be payable to the extent such Eurodollar Rate Taxes exceed the amount
paid pursuant to SECTION 2.10(vii)(a) below.
(c) Notwithstanding anything contained in this SECTION 2.10 to
the contrary, the provisions of SECTION 2.13 hereof applicable to Taxes shall be
fully applicable, MUTATIS MUTANDIS, to Eurodollar Rate Taxes, and the Borrowers
shall not be required to pay any amount under this SECTION 2.10 that would not
be payable after taking into account the provisions of such SECTION 2.13 below,
including, without limitation, any limitation on the amount payable to the
Borrowers pursuant to SUBSECTIONS (iii) THROUGH (ix) inclusive of such SECTION
2.13 below.
(viii) BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make, carry
or transfer Eurodollar Rate Loans at, to, or for the account of, any of its
branch offices, agencies or the office of a Eurodollar Affiliate of that Lender;
PROVIDED, HOWEVER, no such Lender shall be entitled to receive any greater
amount under SECTION 2.05(vi) or SECTION 2.10(vii) above as a result of the
transfer of any such Eurodollar Rate Loan than such Lender would be entitled to
immediately prior thereto unless (a) such transfer occurred at a time when
circumstances giving rise to the claim for such greater amount did not exist and
were not reasonably foreseeable in the view of such Lender and (b) such claim
would have arisen even if such transfer had not occurred.
(ix) AFFILIATES NOT OBLIGATED. Unless expressly provided herein, no
Eurodollar
Affiliate or other affiliate of any Lender shall be deemed a party to this Loan
Agreement or shall have any rights, liability or obligation under this Loan
Agreement.
SECTION 2.11 INCREASED CAPITAL. If either (i) the introduction of or any
change in or in the interpretation of any Law or regulation or (ii) compliance
by any Lender with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of Law and whether or
not the failure to comply therewith would be unlawful) affects or would affect
the amount of capital required or expected to be maintained by such Lender or
any corporation controlling such Lender and such Lender determines that the
amount of such capital is increased by or based upon the existence of such
Lender's US Revolving Credit Commitment, Canadian Revolving Credit Commitment
and/or Acquisition/Term Loan Commitment, if any, and other commitments of this
type or upon the existence of Letters of Credit (or similar contingent
obligations), then, upon demand by such Lender, together with the certificate
referred to in the last sentence of this SECTION 2.11, the applicable Borrowers
shall immediately pay to such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender for any loss in
its net yield from the transactions contemplated by this Loan Agreement in the
light of such circumstances, to the extent that such Lender reasonably
determines such increase in capital to be allocable to the existence of such
Lender's Commitments or to the issuance or maintenance of any Letter of Credit
for the account of the Borrowers. A certificate as to such amounts, together
with calculations evidencing such additional amount and the law, rule,
interpretation, regulation or guideline with respect thereto, submitted to the
Borrowers by such Lender, shall, in the absence of manifest error, be conclusive
and binding for all purposes.
SECTION 2.12 AUTHORIZED OFFICERS OF THE BORROWERS. The Borrowers shall
notify the Administrative Agent or, with respect to the Canadian Revolving
Credit Loan Facility, the Canadian Collateral Agent in writing of the names of
the officers and employees authorized to request Loans, Letters of Credit and
Canadian Bankers Acceptances and to request a conversion/continuation of any
Loan and/or any Canadian Bankers Acceptance and shall provide the Administrative
Agent or, with respect to the Canadian Revolving Credit Loan Facility, the
Canadian Collateral Agent with a specimen signature of each such Authorized
Officer. The Administrative Agent, the Canadian Collateral Agent and each of the
Lenders shall be entitled to rely conclusively on such officer's or employee's
authority to request such Loan, Letter of Credit or Canadian Bankers Acceptance
or such conversion/continuation until the Administrative Agent or, with respect
to the Canadian Revolving Credit Loan Facility, the Canadian Collateral Agent
receives written notice to the contrary. None of the Administrative Agent, the
Canadian Collateral Agent or any of the Lenders shall have any duty to verify
the authenticity of the signature appearing on any written Notice of Borrowing
or Notice of Conversion/Continuation which it believes in good faith and absent
gross negligence has been signed or presented by the proper party or parties
and, with respect to an oral request for such a Loan or Letter of Credit or such
conversion/continuation, none of the Administrative Agent, the Canadian
Collateral Agent or any of the Lenders shall have any duty to verify the
identity of any Person representing himself as one of the officers or employees
authorized to make such request on behalf of the Borrowers.
None of the Administrative Agent, the Canadian Collateral Agent or any Lender
shall incur any liability to the Borrowers in acting upon any telephonic notice
referred to above which the Administrative Agent or, with respect to the
Canadian Revolving Credit Loan Facility, the Canadian Collateral Agent believes
in good faith and absent gross negligence to have been given by a duly
Authorized Officer or other person authorized to borrow on behalf of the
Borrowers or for otherwise acting in good faith under this SECTION 2.12.
SECTION 2.13 TAXES.
(i) PAYMENTS NET OF TAXES. Provided that each Lender and the
Administrative Agent or, with respect to the Canadian Revolving Credit Loan
Facility, the Canadian Collateral Agent shall have complied with the provisions
of SECTION 2.13(iii), all payments made by the Borrowers under this Loan
Agreement or any other Loan Document shall be made free and clear of, and
without reduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions
or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, including, without limitation, any taxes
assessed by the United States, any State in the United States, Canada and/or any
Province in Canada, and all liabilities with respect thereto, excluding
(a) in the case of the Administrative Agent or, with respect
to the Canadian Revolving Credit Loan Facility, the Canadian Collateral Agent
and each Lender, net income or franchise taxes imposed on such Agent and/or such
Lender by the jurisdiction under the laws of which such Agent or such Lender is
organized or any political subdivision or taxing authority thereof or therein or
as a result of a connection between such Agent or Lender and any jurisdiction
(whether or not attributable to the transactions contemplated hereby), and
(b) in the case of each Lender, net income or franchise taxes
imposed by any jurisdiction in which such Lender's lending offices which make or
book loans are located or any political subdivision or taxing authority thereof
or therein (all such non-excluded taxes, levies, imposts, duties, deductions,
charges, fees or withholdings of such Governmental Authorities, including,
without limitation, any taxes assessed by the United States, any State in the
United States, Canada and/or any Province in Canada, being hereinafter referred
to as the "Taxes"). If any Taxes are required to be withheld or deducted from
any amounts payable to the Administrative Agent or, with respect to the Canadian
Revolving Credit Loan Facility, the Canadian Collateral Agent or any Lender
under this Loan Agreement or any other Loan Document, the Borrowers shall pay
the relevant amount of such Taxes and the amounts so payable to such Agent or
such Lender shall be increased to the extent necessary to yield to such Agent or
such Lender (after payment of all Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Loan
Agreement and the other Loan Documents. Whenever any Taxes are paid by the
Borrowers with respect to payments made in connection with this Loan Agreement
or any other Loan Document, as promptly as possible thereafter, the Borrowers
shall send to the Administrative Agent or, with respect to the Canadian
Revolving Credit Loan Facility, the Canadian Collateral Agent for its own
account or for the
account of such Lender, as the case may be, a certified copy of an original
official receipt received by the Borrowers showing payment thereof.
(ii) INDEMNITY. Provided that each Lender and the Administrative
Agent or, with respect to the Canadian Revolving Credit Loan Facility, the
Canadian Collateral Agent shall have complied with the provisions of SECTION
2.13(iii) below, the Borrowers hereby agree to indemnify the Administrative
Agent or, with respect to the Canadian Revolving Credit Loan Facility, the
Canadian Collateral Agent and each of the Lenders for the full amount of all
Taxes attributable to payments by or on behalf of the Borrowers hereunder or
under any of the other Loan Documents paid by such Agent or such Lender
(including any incremental Taxes, interest or penalties that may become payable
by such Agent or such Lender as a result of any failure to pay such Taxes),
whether or not such Taxes were correctly or legally asserted, excluding any of
the foregoing arising out of any Agent's or any Lender's gross negligence or
willful misconduct. The amount of Taxes due pursuant to the preceding sentence
shall only be payable to the extent such Taxes exceed the amount of Taxes paid
pursuant to SECTION 2.13(i) above. Such indemnification shall be made within
thirty (30) days from the date such Lender or such Agent, as the case may be,
makes written demand therefrom together with the calculation thereof and the
basis therefor.
(iii) WITHHOLDING AND BACKUP WITHHOLDING. (a) Each Lender (other
than the Canadian Lenders providing Canadian Revolving Credit Loans and/or
Canadian Letters of Credit) that is incorporated or organized under the Laws of
any jurisdiction other than the United States or any State thereof agrees that,
on or prior to the date any payment is due to be made to it hereunder or under
any other Loan Document in connection with its US Revolving Credit Commitment
and/or Acquisition/Term Loan Commitment for Loans and Letters of Credit which
are to be booked in the United States, as directed by the Borrowers, it will
furnish to the Borrowers and the Administrative Agent:
(1) (A) in the case of a Lender which is a "bank" within the
meaning of Section 881(c)(3)(A) of the Code, two valid, duly completed copies of
United States Internal Revenue Service Form 4224 or United States Internal
Revenue Form 1001 and/or Non-Bank Compliance Certificate, as applicable, or
successor applicable form, as the case may be, certifying in each case that such
Lender is entitled to receive payments under this Loan Agreement and the other
Loan Documents without deduction or withholding of any United States federal
income taxes and (B) in the case of a Lender which is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Code, a certificate in substantially the
form attached hereto as EXHIBIT "M" and made a part hereof, with blanks
appropriately filled (hereinafter each referred to as a "Non-Bank Compliance
Certificate"); and
(2) a valid, duly completed Internal Revenue Service Form W-8
or W-9 or successor applicable form, as the case may be, to establish an
exemption from United States backup withholding tax.
Each Lender which so delivers to the Borrowers and the Administrative Agent a
Form 1001 or 4224 and/or Non-Bank Compliance Certificate, as applicable, and
Form W-8 or W-9, or successor applicable forms agrees to deliver to the
Borrowers and the Administrative Agent two further copies of the said Form 1001
or 4224 and/or Non-Bank Compliance Certificate, as applicable, and Form W-8 or
W-9, or successor applicable forms, or other manner of certification, as the
case may be, on or before the date that any such form expires or becomes
obsolete or otherwise is required to be resubmitted as a condition to obtaining
an exemption from withholding tax, or after the occurrence of any event
requiring a change in the most recent form previously delivered by it, and such
extensions or renewals thereof as may reasonably be requested by the Borrowers
and the Administrative Agent, certifying in the case of a Form 1001 or Form 4224
and/or Non-Bank Compliance Certificate, as applicable, that such Lender is
entitled to receive payments under this Loan Agreement or any other Loan
Document without deduction or withholding of any United States federal income
taxes, unless a change of Law has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
letter or form with respect to it and such Lender advises the Borrowers and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax, and in the case of
a Form W-8 or W-9, establishing an exemption from United States backup
withholding tax. If the form provided by the Lender or the Administrative Agent
(other than in the event of a change in law) indicates a withholding tax in
excess of zero, then such withholding tax shall be considered excluded from
Taxes and no payment shall be due under this SECTION 2.13 with respect to such
withholding tax.
(b) Each Canadian Lender that is incorporated or organized
under the Laws of any jurisdiction other than Canada or any Province of Canada
agrees that, on or prior to the date any payment is to be made to it hereunder
or under any other Loan Document in connection with its Canadian Revolving
Credit Commitment for Canadian Revolving Credit Loans and Canadian Letters of
Credit, it will furnish or will have previously furnished to the Canadian
Borrower and the Canadian Collateral Agent a Certificate of Residency, in a form
reasonably acceptable to the Canadian Collateral Agent (confirming either that
(1) it is not a non-resident of Canada for purposes of the Income Tax Act
(Canada) or (2) Canadian withholding tax is otherwise not exigible on any
payments to be made by the Canadian Borrower to such Canadian Lender.
(iv) Any Lender or any Agent claiming amounts payable under this
SECTION 2.13 or SECTION 2.10(vii) of this Loan Agreement shall use reasonable
efforts to mitigate taxes (e.g., changing the jurisdiction of its lending
office) if such efforts would reduce the amounts payable under this SECTION 2.13
or SECTION 2.10(vii) of this Loan Agreement.
(v) Upon the payment in full to a Lender or the Administrative Agent
or, with respect to the Canadian Revolving Credit Loan Facility, the Canadian
Collateral Agent with respect to Taxes or Eurodollar Rate Taxes under this
SECTION 2.13 or SECTION 2.10(vii) the Borrowers shall be subrogated to all
rights of the applicable Lender or the applicable Agent to
seek recovery or reimbursement from any Person of such amounts. Provided a
Lender has complied with the terms of this SECTION 2.13 and SECTION 11.02 of
this Loan Agreement, there shall be no right of the Borrowers to recover or
receive reimbursement against or from said Lender or the Administrative Agent
or, with respect to the Canadian Revolving Credit Loan Facility, the Canadian
Collateral Agent for foreign tax credits in respect of said Lender's taxable
income in respect of such Taxes or Eurodollar Rate Taxes. Each Lender and the
Administrative Agent or, with respect to the Canadian Revolving Credit Loan
Facility, the Canadian Collateral Agent shall reasonably assist the Borrowers to
recover amounts paid pursuant to this SECTION 2.13 or SECTION 2.10(vii) above
from the relevant taxing authority. If a Lender or the Administrative Agent or,
with respect to the Canadian Revolving Credit Loan Facility, the Canadian
Collateral Agent subsequently recovers, or receives a net tax benefit with
respect to any amount of Taxes or Eurodollar Rate Taxes paid or indemnified by
the Borrowers, then such Lender or such Agent, as applicable, shall pay to the
Borrowers the amount of any such recovery or net tax benefit within thirty (30)
days of the receipt of such refund.
(vi) Unless the Borrowers have given their prior written consent,
none of the Lenders or the Administrative Agent or, with respect to the Canadian
Revolving Credit Loan Facility, the Canadian Collateral Agent shall be entitled
to a payment under this SECTION 2.13 or SECTION 2.10(vii) of this Loan Agreement
with respect to Taxes or Eurodollar Rate Taxes which resulted directly from the
Administrative Agent's or, with respect to the Canadian Revolving Credit Loan
Facility, the Canadian Collateral Agent's or a Lender's change in account,
branch or office.
(vii) None of the Lenders or the Administrative Agent or, with
respect to the Canadian Revolving Credit Loan Facility, the Canadian Collateral
Agent shall be entitled to a payment under this SECTION 2.13 or SECTION
2.10(vii) to the extent such payment arises out of the Lender's or the
Administrative Agent's or, with respect to the Canadian Revolving Credit Loan
Facility, the Canadian Collateral Agent's gross negligence or willful
misconduct.
(viii) No amounts will be payable under this SECTION 2.13 to the
extent that such amounts have been covered pursuant to another section of this
Loan Agreement.
(ix) All payments made pursuant to this SECTION 2.13 or SECTION
2.10(vii) shall be treated by the relevant parties as additional interest
hereunder.
SECTION 2.14 SECURITY FOR THE LOAN FACILITIES. As security for the due and
punctual payment and performance of the Obligation of the Borrowers under the
Loan Documents, the Borrowers shall execute, or cause to be executed, and
deliver to the applicable Agent or Agents, for the benefit of the appropriate
Lenders, the Collateral Documents.
SECTION 2.15 CURRENCY FLUCTUATIONS.
(i) Not later than 1:00 p.m. (Toronto, Ontario time) on the last
Business Day
of each calendar month (hereinafter referred to as the "Calculation Date"), the
Canadian Collateral Agent shall determine the Exchange Rate as of such date. The
Exchange Rate so determined shall become effective on the first Business Day
immediately following such determination (hereinafter referred to as a "Reset
Date") and shall remain effective until the next succeeding Reset Date.
(ii) Not later than 4:00 p.m. (Toronto, Ontario time) on each Reset
Date, the Canadian Collateral Agent shall determine the Dollar Equivalent of the
outstanding Canadian Revolving Credit Loans, Canadian Bankers Acceptances
(without discount) and Canadian Letters of Credit.
(iii) If, on any Reset Date and/or on the Canadian Revolving Credit
Termination Date, the aggregate outstanding amount (expressed in US Dollars) of
all Canadian Revolving Credit Loans, Canadian Letter of Credit Obligations and
the aggregate face amount of all outstanding Canadian Bankers Acceptances
(without discount) exceeds US$5,000,000.00 (hereinafter referred to as the
"Maximum Canadian Exposure"), then (a) the Canadian Collateral Agent shall give
notice thereof to the Canadian Borrower and the Canadian Lenders and (b) within
two (2) Business Days thereafter, the Canadian Borrower shall repay or prepay
Canadian Revolving Credit Loans in accordance with this Loan Agreement in an
aggregate principal amount such that, after giving effect thereto, the aggregate
outstanding amount (expressed in US Dollars) of all Canadian Revolving Credit
Loans, Canadian Letter of Credit Obligations and the aggregate face amount
(without discount) of all outstanding Canadian Bankers Acceptances no longer
exceeds the Maximum Canadian Exposure; PROVIDED THAT nothing herein shall
diminish the Canadian Borrower's obligation to repay in full all of the
Obligations as and when required by the terms, conditions and provisions of this
Loan Agreement.
(iv) Without limiting the terms, conditions and/or provisions of
SECTION 2.15(iii) above, if, on any day prior to the Canadian Revolving Credit
Termination Date, the aggregate outstanding amount (expressed in US Dollars) of
all Canadian Revolving Credit Loans, the Canadian Letter of Credit Obligations
and the aggregate face amount of all outstanding Canadian Bankers Acceptances
(without discount) exceeds the Maximum Canadian Exposure, then (a) the Canadian
Collateral Agent shall give notice thereof to the Canadian Borrower and the
Canadian Lenders and (b) within two (2) Business Days thereafter, the Canadian
Borrower shall repay or prepay Canadian Revolving Credit Loans in accordance
with the terms, conditions and provisions of this Loan Agreement in an aggregate
principal amount such that, after giving effect thereto, the aggregate
outstanding amount (expressed in US Dollars) of all Canadian Revolving Credit
Loans, the Canadian Letter of Credit Obligations and the aggregate face amount
of all outstanding Canadian Bankers Acceptances (without discount) no longer
exceeds the Maximum Canadian Exposure. Nothing set forth in this SECTION 2.15
shall be construed to require the Canadian Collateral Agent to calculate daily
compliance under this SECTION 2.15.
(v) To the extent the repayments and prepayments referenced in
SECTIONS 2.15(iii) and 2.15(iv) above are such that, after giving effect
thereto, the Canadian Letter of Credit Obligations and the aggregate face amount
of all outstanding Canadian Bankers Acceptances (without discount) still
exceeds the Maximum Canadian Exposure (expressed in US Dollars), then the
Canadian Borrower shall immediately upon demand provide cash collateral to the
Canadian Collateral Agent required to obtain such results.
SECTION 2.16 JOINT AND SEVERAL LIABILITY. All of the Borrowers hereby
acknowledge, covenant and agree that all Obligations, liabilities and covenants
made, incurred and undertaken by them under this Loan Agreement and the other
Loan Documents, including, without limitation, all obligations to pay principal,
interest, fees and expenses, in connection with (i) the US Revolving Credit Loan
Facility and the Acquisition/Term Loan Facility ONLY, are on a JOINT AND SEVERAL
BASIS as amongst the US Borrowers ONLY and that the Canadian Borrower shall have
no liability for the repayment of any of the US Revolving Credit Loans, the
Acquisition/Term Loans and/or the US Reimbursement Obligations and (ii) the
Canadian Revolving Credit Loan Facility and the F/X Line of Credit Facility
ONLY, are solely the obligations of the Canadian Borrower and the US Borrowers
shall have no liability for the repayment of the Canadian Revolving Credit
Loans, the F/X Line of Credit Facility and/or the Canadian Reimbursement
Obligations, except for the obligations of the US Borrowers under and/or in
connection with any of the Agreements of Guaranty.
ARTICLE III
CONDITIONS PRECEDENT TO THE LOAN FACILITIES
SECTION 3.01 CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS LOAN
AGREEMENT. This Loan Agreement shall become effective on the Closing Date when
the following conditions precedent have been satisfied (unless waived by the
Requisite Lenders or unless the deadline for delivery has been extended by the
Administrative Agent):
(i) CERTAIN DOCUMENTS. The Administrative Agent and the Canadian
Collateral Agent shall have received on or before the Closing Date all of the
following, all of which, except as otherwise specifically described below, shall
be in form and substance satisfactory to the Requisite Lenders and in sufficient
copies for each of the Lenders:
(a) This Loan Agreement, together with all Exhibits and
Schedules attached hereto;
(b) A Notice of Borrowing pursuant to SECTION 2.01 and SECTION
2.02 of this Loan Agreement dated the Closing Date and executed by the
applicable Borrowers;
(c) A US Revolving Credit Loan Note made payable to Summit
Bank;
(d) A Canadian Revolving Credit Loan Note made payable to
Mellon Canada;
(e) An Acquisition/Term Loan Note #1 made payable to Summit
Bank, if applicable;
(f) An Acquisition/Term Loan Note #1 made payable to Mellon
Bank, N.A., if applicable;
(g) The Security Agreements;
(h) The Pledge of Stock Agreements;
(i) The Agreements of Guaranty;
(j) UCC-1 Financing Statements under the Uniform Commercial
Code, as enacted in any jurisdiction where any of the Collateral is located and
financing statements under the Personal Property Security Act (Ontario), each
signed by the applicable Borrowers and financing statement registrations signed
by or on behalf of the Canadian Collateral Agent;
(k) Opinions addressed to the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and each Lender, dated the
Closing Date, of counsel to the Borrowers and other applicable Persons covering
the matters addressed in EXHIBIT "N" hereto and such other matters as may be
requested by the Administrative Agent, all in form and substance satisfactory to
the Administrative Agent in its sole and absolute discretion; and
(l) Certificates of the Secretary or Assistant Secretary of
the Borrowers dated the Closing Date certifying (1) the names and true
signatures of the incumbent officers of the Borrowers authorized to sign this
Loan Agreement and all other Loan Documents executed by the Borrowers in
connection with this Loan Agreement, (2) the By-Laws of the Borrowers as in
effect on the date of such certification, (3) the resolutions of the Borrowers'
Board of Directors approving and authorizing the execution, delivery and
performance of this Loan Agreement and all other Loan Documents executed by the
Borrowers in connection therewith, or filed by the Borrowers and (4) that there
have been no changes in the Certificate of Incorporation of the Borrowers since
the date of the most recent certification thereof by the office of the
appropriate Governmental Authority delivered to the Administrative Agent prior
to the Closing Date;
(m) The Certificates of Incorporation of the Borrowers, as
amended, modified and/or supplemented, as applicable, up to and including the
Closing Date, which shall be certified to be true, correct and complete by the
office of the appropriate Governmental Authority delivered to the Administrative
Agent prior to the Closing Date;
(n) Good Standing Certificates and/or Certificates of Status
certified by the office of the appropriate Governmental Authority, relating to
the Borrowers for each of the states, provinces and countries in which the
Borrowers are qualified to conduct business;
(o) Projected consolidated balance sheets, income statements
and cash flow projections for the Borrowers for the Fiscal Years 2001 through
2003 and such other financial information (including any annual or quarterly
financial statements of the Borrowers) as the Administrative Agent or the
Requisite Lenders may request;
(p) Evidence of the insurance required by the terms of the
Collateral Documents, containing the endorsements required by such Collateral
Documents and this Loan Agreement;
(q) A contemporaneous search of UCC, all relevant Personal
Property Security Act registries in Ontario, real property, tax, judgment and
litigation dockets and records, BANK ACT notices and other appropriate registers
shall have revealed no filings or recordings in effect with respect to (1) the
Collateral purported to be covered by the Collateral Documents and (2) the
Borrowers and their Subsidiaries, except such as are acceptable to the
Administrative Agent and the Canadian Collateral Agent (it being understood that
such acceptance does not limit the obligations of the Borrowers with respect to
the priority of the Liens in favor of the
Administrative Agent) and the Administrative Agent and the Canadian Collateral
Agent shall have received a copy of the search reports received as a result of
the search; and
(r) Such additional documentation as the Administrative Agent
or the Requisite Lenders may reasonably require.
(ii) FEES AND EXPENSES PAID. The Borrowers shall have paid to the
Administrative Agent or the Canadian Collateral Agent, as applicable, for its
own account and for the account of each Lender, as applicable, all fees and
expenses due and payable under this Loan Agreement, if any, on or before the
Closing Date (including, without limitation, all attorneys' and solicitors' fees
and expenses).
(iii) REPRESENTATIONS AND WARRANTIES. All of the representations and
warranties of the Borrowers and their Subsidiaries contained in SUBSECTIONS (i)
THROUGH (xxxv) of SECTION 4.01 hereof and in any other Loan Document (other than
for changes permitted or contemplated by this Loan Agreement and/or the
Agreements of Guaranty) shall be true and correct in all material respects on
and as of the Closing Date as though made on and as of that date (except any
such representations and warranties stated to be given on a specific date other
than the Closing Date).
(iv) NO DEFAULT. No Event of Default or Potential Event of Default
hereunder or under the other Loan Documents shall have occurred and be
continuing on the Closing Date.
(v) NO INJUNCTION. No Requirements of Law shall prohibit, and no
order, judgment or decree of any Governmental Authority shall and, except as set
forth on SCHEDULE 4.01(vii) hereto, no litigation shall be pending or threatened
which in the reasonable judgment of the Administrative Agent or Requisite
Lenders would, enjoin, prohibit restrain, impose or result in the imposition of
any material adverse condition upon the consummation of the transactions
contemplated hereby.
(vi) COLLATERAL INFORMATION . The Administrative Agent shall have
received complete and accurate information from the Borrowers with respect to
the name and the location of the principal place of business and chief executive
office for the Borrowers and their Subsidiaries.
(vii) CONSENTS. The Borrowers shall have received all consents and
authorizations required pursuant to any material contractual obligation with any
other Person and shall have obtained all consents and authorizations of, and
effected all notices to and filings with, any Governmental Authority, in each
case, as may be necessary to allow the Borrowers lawfully (a) to execute,
deliver and perform, in all material respects, their obligations under this Loan
Agreement, the other Loan Documents to which they are, or are to be, a party and
each other agreement or instrument to be executed and delivered by them pursuant
thereto or in connection therewith and (b) to create and perfect or continue the
perfection of the Liens on the Collateral to
be owned by them in the manner and for the purpose contemplated by the
Collateral Documents.
(viii) NO MATERIAL ADVERSE CHANGE. No Material Adverse Change shall
have occurred since the date of the most recent annual "audited" financial
report of the Borrowers and their Subsidiaries delivered to the Administrative
Agent and the Requisite Lenders through the Closing Date, as to the condition
(financial or otherwise), operations, performance, properties or prospects of
the Borrowers and their Subsidiaries.
SECTION 3.02 CONDITIONS PRECEDENT TO ALL LOANS AND LETTERS OF CREDIT. The
obligation of any Lender to make any Loan requested to be made by it, and of the
Issuing Bank to issue any Letter of Credit, on any date, is subject to the
following conditions precedent as of such date:
(i) NOTICE OF BORROWING. With respect to a request for a Revolving
Credit Loan, the Administrative Agent shall have received in accordance with the
provisions of SECTION 2.01(ii) AND/OR SECTION 2.02(ii) hereof, on or before any
Borrowing Date, an original or facsimile, duly executed, Notice of Borrowing and
the applicable Borrowers have otherwise complied with the requirements of
SECTION 2.01(ii) AND/OR SECTION 2.02(ii) of this Loan Agreement. With respect to
a request for an Acquisition/Term Loan, the Administrative Agent shall have
received in accordance with the provisions of SECTION 2.03(ii) hereof, on or
before any Borrowing Date, an original or facsimile, duly executed, Notice of
Borrowing and the US Borrowers have otherwise complied with the requirements of
SECTION 2.03(ii) of this Loan Agreement.
(ii) APPLICATION FOR LETTERS OF CREDIT. With respect to a request
for the issuance of a Letter of Credit, the appropriate Issuing Bank shall have
received in accordance with the provisions of SECTION 2.01(vi) AND/OR SECTION
2.02(vi) hereof, on or before the date of issuance, an original and duly
executed Letters of Credit Reimbursement Agreement.
(iii) ADDITIONAL MATTERS. As of the Borrowing Date for any Loan or
the date of issuance of any Letter of Credit:
(a) REPRESENTATIONS AND WARRANTIES. All of the representations
and warranties of the Borrowers and their Subsidiaries contained in SECTIONS
4.01(i) THROUGH (xxxv) hereof and in any other Loan Document (other than
representations and warranties which expressly speak only of a different date
and other than for changes permitted or contemplated by this Loan Agreement
and/or the Agreements of Guaranty) shall be true and correct in all material
respects on and as of such Borrowing Date, as though made on and as of such
date;
(b) NO DEFAULT. No Event of Default or Potential Event of
Default shall have occurred and be continuing or would result from the making of
the requested Loan or the issuance of the requested Letter of Credit;
(c) NO INJUNCTION. No law or regulations shall prohibit, and
no order,
judgment or decree of any Governmental Authority shall, and, except as set forth
on SCHEDULE 4.01(vii) hereto, no litigation shall be pending or threatened which
in the judgment of the Administrative Agent or the Requisite Lenders would,
enjoin, prohibit, restrain, impose or result in the imposition of any material
adverse condition upon, (1) any Lender from making the Loan requested to be made
on the Borrowing Date or (2) the Issuing Bank, as the case may be, from issuing
the Letter of Credit requested to be issued on the Borrowing Date; and
(d) NO MATERIAL ADVERSE CHANGE. No Material Adverse Change
shall have occurred after the Closing Date.
Each submission by the Borrowers to the Administrative Agent and/or
the Canadian Collateral Agent, as applicable, of a Notice of Borrowing with
respect to a Loan and the acceptance by the Borrowers of the proceeds of each
such Loan made hereunder, or the request for the issuance of a Letter of Credit
and the issuance of such Letter of Credit, shall constitute a representation and
warranty by the Borrowers as of the Borrowing Date in respect of such Loan and
the date of issuance of any Letter of Credit that all the conditions contained
in this SECTION 3.02 have been satisfied.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 REPRESENTATIONS AND WARRANTIES ON THE CLOSING DATE. In order
to induce the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and the Lenders to enter into this Loan Agreement, the
Borrowers hereby represent and warrant to the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and the Lenders that the
following statements are true, correct and complete on and as of the Closing
Date:
(i) ORGANIZATION; CORPORATE POWERS. Each of the Borrowers (a) is a
corporation duly organized, validly existing and in good standing under the Laws
of the jurisdiction of its respective incorporation or formation, (b) is duly
qualified to conduct business as a foreign corporation and is in good standing
under the Laws of each jurisdiction in which it owns or leases real property or
in which the nature of its business requires it to be so qualified and (c) has
all requisite power and authority to own, operate and encumber its property and
assets and to conduct its business as presently conducted and as proposed to be
conducted in connection with and following the consummation of the transactions
contemplated by the Loan Documents.
(ii) AUTHORITY. (a) Each of the Borrowers has the requisite
corporate power and authority (1) to execute, deliver and perform each of the
Loan Documents executed by it, or to be executed by it and (2) to file the Loan
Documents filed by it, or to be filed by it, with the appropriate Governmental
Authority.
(b) The execution, delivery and performance (or filing, as the
case may be) of each of the Loan Documents to which each of the Borrowers is a
party and the consummation of the transactions contemplated thereby, have been
duly authorized by the Board of Directors of such Borrower and no further
corporate proceedings on the part of such Borrower are necessary to consummate
such transactions.
(c) Each of the Loan Documents to which each of the Borrowers
is a party has been duly executed and delivered (or filed, as the case may be)
by such Borrower and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms.
(iii) SUBSIDIARIES AND OWNERSHIP OF CAPITAL STOCK. As of the Closing
Date, Cantel Medical has two (2) active Subsidiaries; MediVators and Carsen
Group and one (1) inactive Subsidiary, Wellspring, Inc., a Delaware corporation.
As of the Closing Date, MediVators and Carsen Group have no Subsidiaries. With
respect to Wellspring, Inc., a Delaware corporation, said Subsidiary of Cantel
Medical is completely inactive, owning no assets (other than certain net
operating losses), having no liabilities and conducting no business operations,
and said Subsidiary of Cantel Medical has not been previously dissolved or
liquidated SOLELY as a result of its having said net operating losses. Except
with respect to Cantel Medical,
SCHEDULE 4.01(iii) hereof sets forth the number of authorized, issued and
outstanding shares of each class of capital stock of the Borrowers and their
Subsidiaries. Except for Cantel Medical, no capital stock (or any securities,
instruments, warrants, option or purchase rights, conversion or exchange rights,
calls, commitments or claims of any character convertible into or exercisable
for capital stock) of the Borrowers and/or their Subsidiaries is subject to
issuance under any security, instrument, warrant, option or purchase rights,
conversion or exchange rights, call, commitment or claim of any right, title or
interest therein or thereto, except as set forth on SCHEDULE 4.01(iii) attached
hereto. The outstanding capital stock of all of the Borrowers and their
Subsidiaries has been duly authorized, validly issued, fully paid and
nonassessable and is not Margin Stock.
(iv) NO CONFLICT. The execution and delivery by the Borrowers of
each Loan Document and the performance of each of the transactions contemplated
thereby do not and will not (a) constitute a tortious interference with any
Contractual Obligation of the Borrowers, (b) conflict with or violate the
Borrowers' and/or their Subsidiaries' respective Certificates of Incorporation
or By-Laws, (c) conflict with, result in a breach of or constitute (with or
without notice or lapse of time or both) a default under any Requirement of Law
or require termination of any Contractual Obligation, the consequences of which
conflict or default or termination are reasonably likely to have a Material
Adverse Effect, (d) result in or require the creation or imposition of any Lien
whatsoever upon any of the properties or assets of the Borrowers (other than
Liens in favor of the Administrative Agent, the US Collateral Agent and/or the
Canadian Collateral Agent permitted pursuant to SECTION 7.02(ii) hereof) or (f)
require any approval of stockholders, other than as otherwise obtained.
(v) GOVERNMENTAL CONSENTS. The execution, delivery and performance
of each Loan Document and the transactions contemplated thereby do not and will
not require any registration with, consent or approval of, or notice to, or
other action to, with or by any Governmental Authority, except filings, consents
or notices which have been, or will in due course, be made, obtained or given.
(vi) GOVERNMENTAL REGULATION. None of the Borrowers or any of their
respective Subsidiaries is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act,
the Investment Company Act of 1940 or any other Law such that any of the
Borrower's and/or their respective Subsidiaries' ability to incur indebtedness
is limited or its ability to consummate the transactions contemplated hereby is
materially impaired.
(vii) LITIGATION; ADVERSE EFFECTS. (a) Except as set forth in
SCHEDULE 4.01(vii) attached hereto, there is no claim, request for equitable
adjustment, termination for convenience or default, action, suit, proceeding,
audit, governmental investigation or arbitration, at law or in equity, or before
or by or against any Governmental Authority, pending or, to the best knowledge
of the Borrowers, threatened against the Borrowers or their Subsidiaries or any
Property of the Borrowers or their Subsidiaries which is reasonably likely to
(1) result in any Material Adverse Change, (2) materially and adversely affect
the ability of the Borrowers and their Subsidiaries to
perform their respective obligations under the Law, any material Contractual
Obligation and/or the Loan Documents or (3) materially and adversely affect the
ability of the Borrowers and/or their Subsidiaries to perform their collective
Obligations or the Lenders' ability to enforce such Obligations.
(b) None of the Borrowers or any of their respective
Subsidiaries is (1) in violation of any applicable Law which violation has or is
reasonably likely to have a Material Adverse Effect or (2) subject to or in
default with respect to any final judgment, writ, injunction, decree, rule or
regulation of any court or Governmental Authority which has or is reasonably
likely to have a Material Adverse Effect. Except as set forth in SCHEDULE
4.01(vii) attached hereto, there is no action, suit, proceeding or investigation
pending or, threatened against or affecting the Borrowers or their Subsidiaries
challenging the validity or the enforceability of any of the Loan Documents.
(viii) NO MATERIAL ADVERSE CHANGE. Since October 31, 2000, no
Material Adverse Change has occurred in the condition (financial or otherwise),
operations or performance of the Borrowers and their Subsidiaries, or the
ability of the Borrowers and their Subsidiaries to perform their respective
Obligations under the Loan Documents.
(ix) PAYMENT OF TAXES. All tax returns and reports of the Borrowers
and their Subsidiaries required to be filed, have been timely filed (or
appropriate extensions of time for the filing of same have been timely
requested), and all taxes, assessments, fees and other governmental charges
thereupon and upon their respective Properties, assets, income and franchises
which are shown on such returns as being due and payable, have been paid when
due and payable, except such taxes, if any, that are reserved against in
accordance with Generally Accepted Accounting Principles, such taxes as are
being contested in good faith by appropriate proceedings or such filings or
taxes the failure to file or to make payment of which when due and payable would
not have, in the aggregate, a Material Adverse Effect. The Borrowers have no
knowledge of any proposed written tax assessment against the Borrowers and their
Subsidiaries that is reasonably likely to have a Material Adverse Effect, which
is not being actively contested in good faith by the Borrowers and their
Subsidiaries.
(x) MATERIAL ADVERSE AGREEMENTS. None of the Borrowers or any of
their respective Subsidiaries is a party to or subject to any Contractual
Obligation or other restriction contained in their respective Certificates or
Articles of Incorporation, By-Laws, Memorandum and Articles of Association or
similar governing documents which is reasonably likely to have a Material
Adverse Effect.
(xi) PERFORMANCE. None of the Borrowers or any of their respective
Subsidiaries is in default in the performance, observance or fulfillment of any
of the material obligations, covenants or conditions contained in any
Contractual Obligation applicable to them, and no condition exists which, with
the giving of notice or the lapse of time or both, would constitute a default
under such Contractual Obligation, in each case, except where the
consequences, direct or indirect, of such default or defaults, if any, are not
reasonably likely to have a Material Adverse Effect.
(xii) SECURITIES ACTIVITIES. None of the Borrowers or any of their
respective Subsidiaries is engaged principally in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock.
(xiii) REQUIREMENTS OF LAW. None of the Borrowers or any of their
respective Subsidiaries has any actual knowledge of any non-compliance with
respect to all Requirements of Law applicable to the Borrowers and their
Subsidiaries and their respective businesses, and to the Borrowers' knowledge,
the Borrowers and their Subsidiaries are not charged with, under investigation
with respect to, any violation of any such Requirements of Law, except where a
non-compliance or violation of all Requirements of Law would not reasonably be
likely to have a Material Adverse Effect.
(xiv) PATENTS, TRADEMARKS, PERMITS, ETC. The Borrowers and their
Subsidiaries own, are licensed to use or otherwise have the lawful right to use,
or have all permits and other governmental approvals, patents, trademarks, trade
names, copyrights, technology, know-how and processes used in or necessary for
the conduct of their respective businesses as currently conducted, except as
would not reasonably be likely to have a Material Adverse Effect. The use of
such permits and other governmental approvals, patents, trademarks, trade names,
copyrights, technology, know how and processes by the Borrowers and their
Subsidiaries does not infringe on the rights of any Person, subject to such
claims and infringements and do not, in the aggregate, give rise to any
liability on the part of the Borrowers and their Subsidiaries. As of the Closing
Date, none of the Borrowers or any of their respective Subsidiaries has any
filings or registrations for patents, trademarks or tradenames in the United
States Patent and Trademark Office or the Canadian Intellectual Property Office
(for patents, trademarks, copyrights or otherwise), EXCEPT for the following
trademark application all of which have been filed in the Canadian Intellectual
Property Office: Application Serial No. 1,018,804 for MEDIVATORS filed on June
14, 1999 by MediVators for use in association with "medical apparatus and parts
therefor; namely, flexible endoscope disinfectors".
(xv) ENVIRONMENTAL MATTERS. Except as disclosed in SCHEDULE 4.01(xv)
attached hereto, (a) the operations of the Borrowers and their Subsidiaries
comply in all substantial respects with all applicable environmental, health and
safety Requirements of Law; (b) the Borrowers and their Subsidiaries have
obtained all environmental, health and safety Permits necessary for their
respective operations, and all such Permits are in good standing, and the
Borrowers and their Subsidiaries are in compliance with all terms and conditions
of such Permits; (c) the Borrowers' and their Subsidiaries' respective present
Properties and operations, and to the best of the Borrowers' knowledge, the
Borrowers' and their Subsidiaries' respective past Properties and operations,
are not the subject of any order from or agreement with any Governmental
Authority or private party or any judicial or administrative proceeding or
investigations respecting any environmental, health or safety Requirements of
Law, and are not
the subject of any Remedial Action or other Liabilities and Costs arising from
the Release or threatened Release of an Environmental Concern Material into the
Environment; (d) none of the Borrowers or any of their respective Subsidiaries
has filed any notice under any Requirement of Law indicating past or present
treatment, storage or disposal of an Environmental Concern Material in violation
of any Environmental Law; (e) none of the Borrowers or any of their respective
Subsidiaries has filed any notice under any applicable Requirement of Law
reporting a Release of an Environmental Concern Material into the Environment in
violation of any Environmental Law; (f) there is not now, nor has there ever
been, on or in the Property of the Borrowers and/or their Subsidiaries in
violation of any Environmental Law: (1) any generation, treatment, recycling,
storage or disposal of any Environmental Concern Material, (2) any underground
storage tanks or surface impoundments, (3) any asbestos-containing material, or
(4) any polychlorinated biphenyls (PCB's) used in hydraulic oils, electrical
transformers or other equipment; (g) none of the Borrowers or any of their
respective Subsidiaries has received any notice or claim to the effect that it
is or may be liable to any Person as a result of the Release or threatened
Release of a Environmental Concern Material into the Environment, or as a result
of exposure to asbestos or to cotton dust, which may result in any liability;
(h) after due inquiry, no Environmental Lien has attached to any Property of the
Borrowers and/or their Subsidiaries; (i) none of the Borrowers or any of their
respective Subsidiaries has entered into any negotiations or agreements with any
Person (including, without limitation, the prior owner(s) of any Property owned
or leased by the Borrowers and/or their Subsidiaries) relating to any Remedial
Action or environmentally related Claim; (j) none of the Borrowers or any of
their respective Subsidiaries has any material contingent liability in
connection with any Release or threatened Release of any Environmental Concern
Material into the Environment; and (k) none of the products that the Borrowers
and/or their Subsidiaries manufacture, distribute or sell, or, to the best of
the Borrowers' and their Subsidiaries' knowledge, ever have manufactured,
distributed or sold, contains an asbestos-containing material.
(xvi) ERISA. As of the Closing Date, the Borrowers, their
Subsidiaries and any ERISA Affiliate do not maintain or contribute to any Plan
other than those Plans listed on SCHEDULE 4.01(xvi) attached hereto. Except as
otherwise provided on SCHEDULE 4.01(xvi), each Plan which is intended to be a
qualified plan has been determined by the IRS to be qualified under Section
401(a), and each trust related to any such Plan has been so determined to be
exempt from federal income tax under Section 501(a) of the Code prior to its
amendment by the Tax Reform Act of 1986, and such Plan and trust are being
operated in all material respects in compliance with and will be timely amended
in accordance with the Tax Reform Act of 1986 and the Omnibus Budget
Reconciliation Act of 1987 as interpreted by the regulations promulgated
thereunder. Except as otherwise provided on SCHEDULE 4.01(xvi) attached hereto,
the Borrowers, their Subsidiaries and any ERISA Affiliate do not maintain or
contribute to any employee welfare benefit plan within the meaning of Section
3(1) of ERISA which provides lifetime benefits to retirees other than as may be
required by the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended and interpreted by regulations promulgated thereunder. The Borrowers,
their Subsidiaries and all of their ERISA Affiliates are in compliance in all
material respects with the responsibilities, obligations or duties imposed on
them by ERISA or
regulations promulgated thereunder with respect to all Plans (and with the
responsibilities, obligations or duties imposed upon them, as applicable, under
Applicable Canadian Pension Legislation). No material accumulated funding
deficiency (as defined in Section 302(a)(2) of ERISA and Section 412(a) of the
Code) exists in respect to any Benefit Plan. The Borrowers, their Subsidiaries
any ERISA Affiliate and any fiduciary of any Plan (a) have not engaged in a
nonexempt "prohibited transaction" described in Section 406 of ERISA or Section
4975 of the Code or (b) have not taken any action which would constitute or
result in a Termination Event with respect to any Plan such that actions under
CLAUSE (a) OR CLAUSE (b) above, or both, would result in a material obligation
to pay money. The Borrowers, their Subsidiaries and any ERISA Affiliate have not
incurred any material liability to the PBGC which remains outstanding other than
the liability to pay the PBGC insurance premiums for the current year. Schedule
B to the most recent annual report filed with the IRS with respect to each
Benefit Plan (which has been furnished to the Administrative Agent) is complete
and accurate in all material respects. Except as provided on SCHEDULE 4.01(xvi)
attached hereto, since the date of each such Schedule B, there has been no
Material Adverse Change in the funding status or financial condition of the
Benefit Plan relating to such Schedule B. The Borrowers, their Subsidiaries and
any ERISA Affiliate have not failed to make a required installment under
subsection (m) of Section 412 of the Code or any other payment required under
Section 412 of the Code on or before the due date for such installment or other
payment which would in the aggregate have a Material Adverse Effect. The
Borrowers, their Subsidiaries and any ERISA Affiliate are not required to
provide security to a Plan under Section 401(a)(29) of the Code due to a Plan
amendment that results in an increase in current liability for the plan year.
The Borrowers, their Subsidiaries and any ERISA Affiliate are not contributing
and have not ever contributed to or been obligated to contribute to any
Multiemployer Plan, and no employees or former employees of the Borrowers, their
Subsidiaries or any ERISA Affiliate have been covered by any Multiemployer Plan
in respect of their employment by the Borrowers or any ERISA Affiliate, and,
accordingly, the representations and warranties in this SECTION 4.01(xvi) do not
apply to Multiemployer Plans.
(xvii) SOLVENCY. (a) The Borrowers and their Subsidiaries, taken as
a whole, are Solvent after giving effect to the transactions contemplated by (1)
this Loan Agreement and the other Loan Documents, (2) the payment and accrual of
all costs payable on the Closing Date with respect to any of the foregoing and
(3) all obligations, if any, under any Plan or the equivalent for unfunded past
service liability and any other unfunded medical (including post-retirement) and
death benefits, (b) MediVators and all of the other domestic Subsidiaries of
Cantel Medical, taken as a whole, are Solvent after giving effect to the
transactions contemplated by (1) this Loan Agreement and the other Loan
Documents, (2) the payment and accrual of all costs payable on the Closing Date
with respect to any of the foregoing and (3) all obligations, if any, under any
Plan or the equivalent for unfunded past service liability and any other
unfunded medical (including post-retirement) and death benefits and (c) the
Canadian Borrower is Solvent after giving effect to the transactions
contemplated by (1) this Loan Agreement and the other Loan Documents, (2) the
payment and accrual of all costs payable on the Closing Date with respect to any
of the foregoing and (3) all obligations, if any, under any Plan or the
equivalent for unfunded
past service liability and any other unfunded medical (including
post-retirement) and death benefits.
(xviii) NOTES QUALIFICATION. As of the date on which this
representation and warranty is made, the offering and issuance of the Notes are
exempt from registration under Section 5 of the Securities Act and the Notes
issued by the Canadian Borrower to the Canadian Lenders are exempt from the
prospectus filing and renewal requirements of the applicable Securities Acts of
the Province of Ontario, Canada or has been registered pursuant to a
registration statement filed pursuant to the Securities Act and, if so
registered, is qualified under the Trust Indenture Act of 1939, as amended.
(xix) ASSETS AND PROPERTIES. Substantially all of the assets and
properties owned by, leased to or used by the Borrowers and their Subsidiaries
(a) are in good operating condition and repair, (ordinary wear and tear
excepted), (b) are free and clear of any known defects (except such defects as
do not substantially interfere with the continued use thereof in the conduct of
normal operations) and (c) are able to serve the function for which they are
currently being used, in each case where the failure of such asset to meet such
requirements would not have or is not reasonably likely to have a Material
Adverse Effect.
(xx) JOINT VENTURE; PARTNERSHIP. Except as set forth in SCHEDULE
4.01(xx) attached hereto, as of the Closing Date, none of the Borrowers or any
of their respective Subsidiaries is engaged in any joint venture or partnership
with any other Person.
(xxi) INSURANCE. The Borrowers and their Subsidiaries maintain with
financially sound and reputable insurers not related to or affiliated with the
Borrowers or their Subsidiaries, insurance with respect to its Properties and
businesses, insured against such liabilities, casualties and contingencies and
in such types and amounts as is customary in the case of corporations engaged in
the same or a similar business or having similar properties similarly situated.
SCHEDULE 4.01(xxi) attached hereto sets forth a list of all insurance currently
maintained by or in respect of the Borrowers and their Subsidiaries setting
forth the identity of the insurance carrier, the type of coverage, the amount of
coverage and the deductible. There are no claims, actions, suits, proceedings
against, arising under or based upon any of such insurance policies except as
set forth in SCHEDULE 4.01(xxi) attached hereto.
(xxii) TITLE TO PROPERTY. The Borrowers and their Subsidiaries have
good and marketable title in fee simple to all respective Property owned or
purported to be owned by them, including, without limitation to all Property
reflected in the most recent consolidated balance sheet referred to in SECTION
4.01(xxiii) hereof or submitted pursuant to ARTICLE V (except as sold or
otherwise disposed of in the ordinary course of business after the date of such
balance sheet), in each case free and clear of all Liens, other than Liens
permitted under the terms of SECTION 7.02(ii) of this Loan Agreement.
(xxiii) AUDITED FINANCIAL STATEMENTS. The Borrowers have heretofore
furnished
to the Administrative Agent a consolidated and consolidating "audited" balance
sheet of Cantel Medical and its Subsidiaries dated as of July 31, 2000, and the
related statements of income, cash flows and changes in stockholders' equity for
the 2000 Fiscal Year then ended, as examined and reported on by their
Independent Certified Public Accountant, who delivered an unqualified opinion in
respect thereof, all as set forth in the Form 10-K. Such financial statements
(including the notes thereto) present fairly the consolidated financial
condition of Cantel Medical and its Subsidiaries as of the end of such 2000
Fiscal Year and the results of their consolidated operations and their cash
flows for the 2000 Fiscal Year then ended, all in conformity with Generally
Accepted Accounting Principles.
(xxiv) UNAUDITED INTERIM FINANCIAL STATEMENTS. The Borrowers have
heretofore furnished to the Administrative Agent interim balance sheet of Cantel
Medical and its Subsidiaries as of the end of their first Fiscal Quarter of the
2001 Fiscal Year which began on August 1, 2000, together with the related
statements of income and cash flows for the applicable Fiscal Quarter ending on
each such date, all as set forth in the Form 10-Q. Such financial statements
present fairly the consolidated financial condition of the Borrowers and their
Subsidiaries as of the end of such Fiscal Quarter and the results of their
consolidated operations and their cash flows for the Fiscal Quarter then ended,
all in conformity with Generally Accepted Accounting Principles, subject to
normal and recurring audit adjustments.
(xxv) ABSENCE OF UNDISCLOSED LIABILITIES. Except as provided on
SCHEDULE 4.01 (xxv) attached hereto and made a part hereof, none of the
Borrowers or any of their respective Subsidiaries has any liability or
obligation of any nature whatever (whether absolute, accrued, contingent or
otherwise, whether or not due), forward or long-term commitments or unrealized
or anticipated losses from unfavorable commitments, except (a) as disclosed in
the financial statements referred to in SECTIONS 4.01(xxiii) AND (xxiv) above,
(b) matters that, individually or in the aggregate could not have a Material
Adverse Effect and (c) Contractual Obligations incurred in the ordinary course
of the Borrowers' and their Subsidiaries' businesses.
(xxvi) MARGIN REGULATIONS. No part of the proceeds of the Loan
Facilities will be used for the purpose of buying or carrying any Margin Stock,
as such term is used in Regulation U of the Federal Reserve Board, as amended
from time to time, or to extend credit to others for the purpose of buying or
carrying any Margin Stock. None of the Borrowers or any of their respective
Subsidiaries is engaged in the business of extending credit to others for the
purpose of buying or carrying Margin Stock. Neither the making of any Loan nor
any use of proceeds of any such Loan will violate or conflict with the
provisions of Regulation T, U or X of the Federal Reserve Board, as amended from
time to time.
(xxvii) LABOR MATTERS. Except as set forth on SCHEDULE 4.01(xxvii)
attached hereto, none of the Borrowers or any of their respective Subsidiaries
is a party to any labor union or collective bargaining agreements. The Borrowers
and their Subsidiaries are in compliance with all applicable laws respecting
employment and employment practices, including, without limitation, laws,
regulations, and judicial and administrative decisions relating to wages, hours,
conditions of work, collective bargaining, health and safety, payment of social
security, payroll, withholding and other taxes, worker's compensation, insurance
requirements, as well as requirements of ERISA and the Consolidated Omnibus
Budget Reconciliation Act, except to the extent that noncompliance would not
have a Material Adverse Effect. There is no (a) unfair labor practice complaint
pending or, to the best knowledge of the Borrowers and their Subsidiaries,
threatened against the Borrowers, and/or their Subsidiaries before the National
Labor Relations Board, any court or any other Governmental Authority nor any
pending or, to the best knowledge of the Borrowers and/or their Subsidiaries,
threatened sexual harassment, or wrongful discharge claim, (b) labor strike,
dispute, slowdown, or stoppage pending or, to the best knowledge of the
Borrowers and/or their Subsidiaries, threatened against the Borrowers and/or
their Subsidiaries or (c) representation petition, respecting the employees of
the Borrowers and/or their Subsidiaries filed or threatened to be filed with the
National Labor Relations Board.
(xxviii) BROKERAGE COMMISSIONS. No other Person is entitled to
receive from any of the Borrowers and/or any of their respective Subsidiaries
any brokerage commission, finder's fee or similar fee or payment in connection
with the consummation of the transactions contemplated by this Loan Agreement.
No brokerage or other fee, commission or compensation is to be paid by the
Lender by reason of any act, alleged act or omission of the Borrowers and/or
their Subsidiaries with respect to the transactions contemplated hereby.
(xxix) BOOKS AND RECORDS. The Borrowers maintain their respective
books and records in accordance with the following: (a) Cantel Medical maintains
its books and records relative to its assets, Properties and business
transactions at its chief executive offices located at 150 Clove Road, 9th
Floor, Overlook at Great Notch, Little Falls, New Jersey 07424, (b) Carsen Group
maintains its books and records relative to its assets, Properties and business
transactions at its chief executive offices located at 151 Telson Road, Markham,
Ontario L3R 1E7 and (c) MediVators maintains its books and records relative to
its assets, Properties and business transactions at its chief executive offices
located at 2995 Lone Oak Circle, Suite 10, Eagan, Minnesota 55121.
(xxx) BUSINESS NAMES. The only names by which the Borrowers and/or
their Subsidiaries are known or under which they are conducting their businesses
are set forth on SCHEDULE 4.01(XXX) attached hereto and made a part hereof.
(xxxi) LOCATION OF COLLATERAL. Except as set forth (a) on SCHEDULE
4.01(xxxi) attached hereto and made a part hereof and (b) in the Security
Agreements, as of the Closing Date, none of the Collateral pledged to the US
Collateral Agent and/or the Canadian Collateral Agent as collateral security
pursuant to this Loan Agreement, the Collateral Documents or any other Loan
Documents, is or will be located in, at or on any location or property other
than as set forth on SCHEDULE 4.01(xxxi) (except Inventory temporarily in
transit, or sample Inventory located and in the possession of salespersons and
customers, or Collateral located at Properties other than those described on
SCHEDULE 4.01(xxxi) for which the Administrative Agent, the US Collateral Agent
and the Canadian Collateral Agent have received the requisite notice described
in SECTION 5.04 hereof). A portion of the Collateral (including, without
limitation, Inventory) is now or will hereafter be located in the Province of
Quebec, Canada. During the six (6) month period immediately preceding the
Closing Date, none of the Collateral was located in, at or on any location or
property other than those sites listed on SCHEDULE 4.01(xxxi) attached hereto
and in the Security Agreements (except Inventory temporarily in transit, or
sample Inventory located and in the possession of salespersons and customers).
(xxxii) ACCOUNTS RECEIVABLE. The most recent list of Accounts
Receivable of the Borrowers and their Subsidiaries delivered to the
Administrative Agent is complete in all material respects, and contains an aging
thereof that is accurate in all material respects. The Accounts Receivable of
the Borrowers and their Subsidiaries have arisen in the ordinary course of their
businesses and reflect BONA FIDE obligations for the payment of goods or
services provided by the Borrowers or their predecessors subject to reserves for
uncollectable amounts (including, without limitation, markdown allowances and
chargebacks) established in the ordinary course of business. As of the Closing
Date, all Accounts Receivable are collectable in the ordinary course of the
Borrowers' and/or their Subsidiaries' respective businesses, subject to reserves
for uncollectable amounts (including, without limitation, markdown allowances
and chargebacks) established in the ordinary course of business; are subject to
no counter-claims or set-offs of any nature whatsoever (other than those arising
out of customer deposits) that would have a Material Adverse Effect; and require
no further act on the Borrowers' or their Subsidiaries' part to make such
Accounts owing by the account debtors. None of the Accounts Receivable includes
consignments or sales on any basis other than that of absolute sale in the
ordinary and usual course of business, except as otherwise set forth on said
list. No agreement has been made under which any deductions or discounts may be
claimed as to any such account except regular discounts in the usual course of
business.
(xxxiii) INVENTORY. Subject to the second sentence of this SECTION
4.01(xxxiii), the Inventory of the Borrowers and their Subsidiaries (a) does not
contain a misbranded hazardous substance or a barred hazardous substance, (b) is
suitable and useful for the purposes of the Borrowers' and/or their
Subsidiaries' respective businesses, (c) is not obsolete, spoiled, contaminated
or damaged and (d) consists of items of a quality and quantity useable or
saleable in the ordinary course of the Borrowers' and/or their Subsidiaries'
respective business, except that which would not have a Material Adverse Effect.
The value of obsolete items, items below standard quality and items in the
process of repair have been written down to realizable market value, or adequate
reserves have been provided therefor, and the values carried on the balance
sheet are set at the lower of cost or market, in accordance with Generally
Accepted Accounting Principles.
(xxxiv) PLEDGE OF COLLATERAL. The Borrowers and their Subsidiaries
have good and marketable title to the Collateral pledged by them, and all such
Collateral is free and clear of all Liens except for (a) Permitted Encumbrances
and (b) as specifically permitted or contemplated by the terms and provisions of
this Loan Agreement and the Collateral Documents relating to such Collateral.
(xxxv) ACCURATE AND COMPLETE DISCLOSURE. The representations and
warranties of the Borrowers or any other Person contained in the Loan Documents,
and all certificates and other documents delivered to the Administrative Agent,
the US Collateral Agent, the Canadian Collateral Agent and/or any Lender, in
connection herewith and therewith, do not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading.
SECTION 4.02. SUBSEQUENT FUNDING REPRESENTATIONS AND WARRANTIES. In order
to induce the Agents and the Lenders to enter into this Loan Agreement and to
make the Loans and issue the Letters of Credit, the Borrowers hereby represent
and warrant to the Agents and the Lenders that the statements set forth in
SUBSECTIONS (i) THROUGH (xxxv) of SECTION 4.01 hereof (except (i) to the extent
that such statements (a) are made expressly only as of the Closing Date or (b)
other than for changes permitted or contemplated by this Loan Agreement and/or
the Agreements of Guaranty), are true, correct and complete in all material
respects on and as of the Borrowing Date in respect of each Borrowing after the
Closing Date and the date of issuance of each Letter of Credit (the making of
each Revolving Credit Loan and/or Acquisition/Term Loan and the issuance of each
Letter of Credit being referred to as a "Subsequent Funding").
ARTICLE V
REPORTING COVENANTS
On and after the Closing Date and so long as the Borrowers shall have any
Obligation hereunder or any Lender shall have any Commitment hereunder, unless
the Requisite Lenders shall give their prior express written consent to the
effect otherwise, then:
SECTION 5.01 STATEMENT OF ACCOUNTING. The Borrowers and their Subsidiaries
shall make and keep books, records and accounts which, in reasonable detail,
accurately and fairly reflect their transactions and dispositions of their
assets and shall maintain a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance
with management's general or specific authorization, (ii) transactions are
recorded as necessary (a) to permit preparation of financial statements in
conformity with Generally Accepted Accounting Principles and any other
accounting principles applicable thereto and (b) to maintain accountability for
assets and (iii) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
SECTION 5.02 REPORTING AND INFORMATION REQUIREMENTS. The Borrowers shall
deliver or cause to be delivered to the Administrative Agent the following
financial statements, data, reports and information, at the Borrowers' own cost
and expense, and the Administrative Agent shall promptly provide all of such
financial statements, data, reports and information to the other Agents and to
the Lenders:
(i) ANNUAL AUDITED CONSOLIDATED AND CONSOLIDATING FINANCIAL
STATEMENTS OF THE BORROWERS AND THEIR SUBSIDIARIES. As soon as available, but in
any event within one-hundred twenty (120) days after the close of each Fiscal
Year of the Borrowers, "audited" consolidated statements of income, cash flows
and stockholders' equity for Cantel Medical and its Subsidiaries for such Fiscal
Year and a consolidated balance sheet for Cantel Medical and its Subsidiaries as
of the close of such Fiscal Year, together with the accompanying footnotes, all
as set forth in the Form 10-K with respect to Cantel Medical filed with the
United States Securities and Exchange Commission. Such consolidated financial
statements shall be accompanied by an opinion of the Independent Certified
Public Accountant, which opinion shall be free of exceptions or qualifications.
Such opinion shall in any event contain a written statement of such accountants
substantially to the effect that (a) such accountants examined the financial
statements in accordance with generally accepted auditing standards and
accordingly made such tests of accounting records and such other auditing
procedures as such accountants considered necessary under the circumstances and
(b) in the opinion of such accountants such financial statements present fairly
the consolidated financial position of Cantel Medical and its Subsidiaries as of
the end of such Fiscal Year, and the consolidated results of Cantel Medical's
and its Subsidiaries' operations and cash flows for such Fiscal Year, in
conformity with Generally Accepted Accounting Principles applied on a basis
consistent with that of the preceding Fiscal Year. In
addition to the delivery of the annual "audited" consolidated financial
statements, the Borrowers shall also deliver to the Administrative Agent and
each of the Lenders, at the same time, an "unaudited" management prepared
consolidating statement of income for the Borrowers and their Subsidiaries for
such Fiscal Year and a consolidating balance sheet for the Borrowers and their
Subsidiaries as of the close of such Fiscal Year, all prepared and certified to
the Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and the Lenders by the Borrowers' chief accounting officer in his or her
capacity as an Authorized Officer.
(ii) ANNUAL OPERATING PLAN. As soon as available, but in any event
within ninety (90) days after the close of each Fiscal Year of the Borrowers, a
copy of the Borrowers' and their Subsidiaries' annual operating plan for the
then current Fiscal Year.
(iii) QUARTERLY CONSOLIDATED AND CONSOLIDATING FINANCIAL STATEMENTS
OF THE BORROWERS AND THEIR SUBSIDIARIES. As soon as available, but in any event
within fifty (50) days after the close of each of the first three Fiscal
Quarters of each Fiscal Year of the Borrowers, "unaudited" consolidated
statements of income and cash flows for the Borrowers and their Subsidiaries for
such Fiscal Quarter and for the period from the beginning of such Fiscal Year to
the end of such Fiscal Quarter, and an "unaudited" balance sheet of the
Borrowers and their Subsidiaries as of the close of such Fiscal Quarter, all as
set forth in the Form 10-Q with respect to Cantel Medical filed with the United
States Securities and Exchange Commission. In addition to the delivery of the
quarterly consolidated financial statements, the Borrowers shall also deliver to
the Administrative Agent and the Lenders, at the same time, an "unaudited"
management prepared consolidating statement of income for the Borrowers and
their Subsidiaries for such Fiscal Quarter and for the period from the beginning
of such Fiscal Year to the end of such Fiscal Quarter and an "unaudited"
consolidating balance sheet of the Borrowers and their Subsidiaries as of the
close of such Fiscal Quarter, all as certified by the chief accounting officer
of the Borrowers in his or her capacity as an Authorized Officer as presenting
fairly the consolidated financial position of the Borrowers and their
Subsidiaries as of the end of such dates and fiscal periods and the consolidated
results of the Borrowers' and their Subsidiaries' operations and cash flows for
such fiscal periods, in conformity with Generally Accepted Accounting Principles
applied in a manner consistent with that of the most recent audited financial
statements furnished to the Administrative Agent, subject to normal and
recurring audit adjustments.
(iv) COMPLIANCE CERTIFICATES. Together with each delivery of any
financial statement pursuant to this SECTION 5.02(i) AND SECTION 5.02(iii)
above, an Officer's Certificate of the Borrowers substantially in the form of
EXHIBIT "I" attached hereto and made a part hereof, (a) stating that the officer
signatory thereto in his or her capacity as an Authorized Officer has reviewed
the terms of this Loan Agreement and the principal Loan Documents, and has made,
or caused to be made under his or her supervision, a review in reasonable detail
of the transactions and condition of the Borrowers and their Subsidiaries, taken
as a whole, during the accounting period covered by such financial statements,
and that such review has not disclosed the existence during or at the end of
such accounting period, and that the signer does not have knowledge of
the existence as at the date of the Officer's Certificate, of any condition or
event which constitutes an Event of Default or Potential Event of Default, or,
if any such condition or event existed or exists, specifying the nature and
period of existence thereof and what action the Borrowers have taken, are taking
and propose to take with respect thereto; (b) demonstrating in reasonable detail
compliance during and at the end of such accounting periods with the financial
covenants contained in ARTICLE VIII of this Loan Agreement; and (c) calculating,
in detail, reasonably acceptable to the Administrative Agent and the Requisite
Lenders, the Excess Cash Flow for the four (4) consecutive Fiscal Quarters
immediately preceding the last day of the accounting period covered by such
financial statements, taken together as one accounting period.
(v) MONTHLY ACCOUNTS RECEIVABLE AGING REPORTS, ETC. As soon as
available, but in any event within twenty (20) days after the close of each
month during each Fiscal Year, a monthly accounts receivable aging report in
summary form only, setting forth the amounts due and owing to each of the
Borrowers and their Subsidiaries, respectively, as of the close of the preceding
month.
(vi) BORROWING BASE CERTIFICATES. As soon as available, but in any
event within twenty (20) days after the close of the prior month during each
Fiscal Year, Borrowing Base Certificates signed by an Authorized Officer or by
Authorized Officers of the Borrowers. In addition, the Borrowers may deliver to
the Administrative Agent, at any time during a calendar month, additional
Borrowing Base Certificates at the time of each request for a Borrowing.
(vii) OTHER REPORTS AND INFORMATION. Promptly upon their becoming
available to the Borrowers, a copy of (a) all reports, financial statements and
other information distributed generally by the Borrowers and their Subsidiaries
to their respective stockholders, partners, bondholders or the financial
community and (b) all accountants' management letters pertaining to, all other
reports submitted by accountants in connection with any audit of, and all other
material reports, if any, from outside accountants with respect to, the
Borrowers and their Subsidiaries.
(viii) FURTHER INFORMATION. The Borrowers shall promptly furnish to
the Administrative Agent such business, financial or other information
concerning the Borrowers and their Subsidiaries in such form as the
Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and/or the Lenders may reasonably request from time to time.
(ix) NOTICE OF EVENT OF DEFAULT. Promptly upon becoming aware of any
Event of Default or Potential Event of Default, the Borrowers shall give the
Administrative Agent, the US Collateral Agent and the Canadian Collateral Agent
written notice thereof, together with a written statement of the President or
chief accounting officer of the Borrowers in his or her capacity as an
Authorized Officer setting forth the details thereof and any action with respect
thereto taken or contemplated to be taken by the Borrowers.
(x) NOTICE OF MATERIAL ADVERSE CHANGE. Promptly upon becoming aware
thereof, the Borrowers shall give the Administrative Agent written notice
concerning any Material Adverse Change in the business, assets, operations or
financial condition of the Borrowers and/or their Subsidiaries taken as a whole,
including, without limitation, any loss from casualty or theft in excess of
US$200,000.00 whether or not insured, affecting any Property of the Borrowers
and their Subsidiaries, setting forth the details thereof and any action with
respect thereto taken or contemplated to be taken by the Borrowers.
(xi) NOTICE OF MATERIAL PROCEEDINGS. Promptly upon becoming aware
thereof, the Borrowers shall give the Administrative Agent written notice of the
commencement, existence or threat of any action, suit, claim, request for
equitable adjustment, proceeding, audit, governmental investigation or
arbitration against or by or otherwise affecting the Borrowers and/or their
Subsidiaries (including without limitation, litigation, arbitration or
administration proceedings) which, if adversely decided, would have a Material
Adverse Effect on the business, assets, operations or financial condition of the
Borrowers and/or their Subsidiaries taken as a whole or on the ability of the
Borrowers and their Subsidiaries to perform their respective obligations under
this Loan Agreement or the other Loan Documents.
(xii) NOTICE OF PENSION-RELATED EVENTS. The Borrowers shall give the
Administrative Agent the following:
(a) As soon as possible, and in any event within ten (10) days
after the Borrowers, their Subsidiaries or an ERISA Affiliate knows or has
reason to know that a Termination Event has occurred, a written statement of the
chief accounting officer of the Borrowers describing such Termination Event and
the action, if any, which the Borrowers, their Subsidiaries or an ERISA
Affiliate has taken, is taking or proposes to take with respect thereto, and
when known, any action taken or threatened by the IRS, the DOL or PBGC with
respect thereto;
(b) As soon as possible, and in any event within fifteen (15)
days, after the Borrowers, their Subsidiaries or an ERISA Affiliate knows or has
reason to know that a non-exempt prohibited transaction (as defined in Section
406 of ERISA and Section 4975 of the Code) has occurred, a statement of the
chief accounting officer of the Borrowers describing such transaction;
(c) Within ten (10) days after the filing thereof with the
DOL, IRS or PBGC, copies of each annual report, filed with respect to each
Benefit Plan;
(d) Within ten (10) days after the filing thereof with the
IRS, a copy of each funding waiver request filed with respect to any Benefit
Plan and all communications received by the Borrowers, their Subsidiaries or an
ERISA Affiliate with respect to such request;
(e) Within thirty (30) days after a written request from the
Administrative Agent, information describing an amendment of any existing
Benefit Plan which
will result in a material increase in the benefits under such Benefit Plan or a
notification of any such increase, or the establishment of any new Plan or the
commencement of contributions to any Plan to which the Borrowers, their
Subsidiaries or an ERISA Affiliate was not previously contributing in a material
amount;
(f) Promptly upon, and in any event within fifteen (15)
Business Days after, receipt by the Borrowers, their Subsidiaries or an ERISA
Affiliate of the PBGC's intention to terminate a Benefit Plan or to have a
trustee appointed to administer a Benefit Plan, copies of each such notice;
(g) Promptly upon, and in any event within ten (10) Business
Days after, receipt by the Borrowers, their Subsidiaries or an ERISA Affiliate
of an unfavorable determination letter from the IRS regarding the qualification
of a Plan under Section 401(a) of the Code;
(h) Promptly upon, and in any event within fifteen (15)
Business Days after, receipt by the Borrowers, their Subsidiaries or an ERISA
Affiliate of a notice from a Multiemployer Plan regarding the imposition of
withdrawal liability; and
(i) Promptly upon, and in any event within fifteen (15)
Business Days after, the Borrowers, their Subsidiaries or any ERISA Affiliate
fails to make a required installment under subsection (m) of Section 412 of the
Code or any other payment required under Section 412 of the Internal Revenue
Code on or before the due date for such installment or payment, a notification
of such failure provided that such installment payment is an amount which is
material.
(xiii) NOTICE OF OTHER MATERIAL DEFAULTS. Promptly upon becoming
aware of any material default by the Borrowers and/or their Subsidiaries under
any Contractual Obligation to which the Borrowers and/or their Subsidiaries or
by which the Borrowers and/or their Subsidiaries or their respective properties
may be bound (the result of which could reasonably be expected to have a
Material Adverse Effect), the Borrowers shall give the Administrative Agent
written notice thereof, together with a written statement of the President or
chief accounting officer of the Borrowers in his or her capacity as an
Authorized Officer setting forth the details thereof and any action with respect
thereto taken or contemplated to be taken by the Borrowers and/or their
Subsidiaries.
(xiv) NOTICE OF MATERIAL CLAIMS. The Borrowers shall promptly notify
the Administrative Agent of all written claims, complaints, orders, citations or
notices, whether formal or informal, received by the Borrowers or their
Subsidiaries from a Governmental Authority or other Person relating to any Law,
including, without limitation, any Environmental Law or health and safety law,
which could reasonably be expected to have a Material Adverse Effect. Such
notices shall include, among other information, the name of the party who filed
the claim, the potential amount of the claim, and the nature of the claim.
SECTION 5.03 ENVIRONMENTAL NOTICES. (i) The Borrowers shall notify the
Administrative Agent and the Canadian Collateral Agent, in writing, promptly,
and in any event within five (5) Business Days after obtaining knowledge, of
any: (a) notice or claim to the effect that the Borrowers and/or their
Subsidiaries are or may be liable to any Person as a result of the Release or
threatened Release of any Environmental Concern Material into the Environment;
(b) notice that the Borrowers or their Subsidiaries are under investigation by
any Governmental Authority evaluating whether any Remedial Action is needed to
respond to the Release or threatened Release of any Environmental Concern
Material into the Environment; (c) notice that
any Property of the Borrowers or their Subsidiaries is subject to an
Environmental Lien; (d) notice of violation to the Borrowers or their
Subsidiaries or awareness by the Borrowers or their Subsidiaries of a condition
which might reasonably result in a notice of violation of any environmental,
health or safety Requirement of Law, which could have a Material Adverse Effect;
(e) commencement or threat of any judicial or administrative proceeding alleging
a violation of any environmental, health or safety Requirement of Law; (f) new
or proposed changes to any existing environmental, health or safety Requirement
of Law that could have a Material Adverse Effect on the operations of the
Borrowers and/or their Subsidiaries; or (g) any proposed acquisition of stock,
assets, real estate, or leasing of property, or any other action by the
Borrowers or their Subsidiaries that could subject the Borrowers or their
Subsidiaries to environmental, health or safety Liabilities and Costs that could
have a Material Adverse Effect.
(ii) Upon written request of the Administrative Agent and/or the
Canadian Collateral Agent, no more frequently than once a year, the Borrowers
shall submit to the Administrative Agent a report prepared by an Authorized
Officer of the Borrowers providing an update of the status of each material
health or safety compliance hazard or liability issue identified in any notice
or report required pursuant to SECTION 5.03(i) hereof.
SECTION 5.04 NOTICE OF NAME CHANGES AND LOCATION CHANGES. The Borrowers
shall (i) immediately notify the Administrative Agent and the Canadian
Collateral Agent if any of the Borrowers and/or their Subsidiaries is known by
or conducting business under any names other than the names described in SECTION
4.01(xxx) hereof, (ii) notify the Administrative Agent and the Canadian
Collateral Agent within fifteen (15) days if the Borrowers and/or their
Subsidiaries are conducting any of their businesses or operations at or out of
offices or locations other than those described in SECTION 4.01(xxix) AND (xxxi)
hereof and (iii) notify the Administrative Agent and the Canadian Collateral
Agent at least fifteen (15) days prior to the date upon which the Borrowers
intend to change the location of their chief executive offices, principal places
of business or location of Collateral from those locations set forth on SCHEDULE
4.01(xxxi) attached hereto.
SECTION 5.05 SEMI-ANNUAL COLLATERAL AUDIT. The Borrowers hereby covenant
and agree that the Administrative Agent, the US Collateral Agent and/or the
Canadian Collateral Agent, as appropriate, shall be permitted to undertake on a
semi-annual basis, at the sole cost and expense of the Borrowers (which cost and
expense shall not exceed $10,000.00 per audit), a field audit of the Collateral
at all locations where said Collateral may be from time to time located.
Notwithstanding anything contained in the preceding sentence to the contrary,
upon the occurrence and during the continuance of an Event of Default, the
Borrowers hereby covenant and agree that the Administrative Agent, the US
Collateral Agent and/or the Canadian Collateral Agent, as appropriate, shall
have the right to make a field audit of the Collateral at all locations where
said Collateral may be from time to time located as frequently as the
Administrative Agent, the US Collateral Agent and/or the Canadian Collateral
Agent so desires at their discretion, at the sole cost and expense of the
Borrowers.
ARTICLE VI
AFFIRMATIVE COVENANTS
The Borrowers hereby covenant and agree that, on and after the Closing
Date and so long as any Lender shall have any Commitment hereunder and until
payment in full of all of the Obligations, unless the Requisite Lenders shall
give their prior express written consent otherwise, then:
SECTION 6.01 CORPORATE EXISTENCE, ETC. The Borrowers and their
Subsidiaries shall at all times maintain their respective status as a
corporation, duly organized, validly existing and in good standing under the
Laws of their respective jurisdiction of incorporation and preserve and keep in
full force and effect their rights and franchises unless the failure to maintain
such rights and franchises would not have a Material Adverse Effect.
SECTION 6.02 CORPORATE POWERS, ETC. The Borrowers and their Subsidiaries
shall qualify and remain qualified to conduct business in each jurisdiction in
which the nature of their respective businesses or the ownership of their
respective Properties or both requires it to be so qualified, unless the failure
to maintain such qualification would not have a Material Adverse Effect. The
Borrowers and their Subsidiaries shall transact business in their own names and
trade names and shall invoice all accounts in their own respective names and
trade names.
SECTION 6.03 COMPLIANCE WITH LAWS, ETC. The Borrowers and their
Subsidiaries shall comply with all Requirements of Law, and all restrictive
covenants affecting the Borrowers and their Subsidiaries or the respective
businesses, Properties, assets or operations of the Borrowers and their
Subsidiaries except to the extent that non-compliance with this SECTION 6.03
would not have a Material Adverse Effect.
SECTION 6.04 PAYMENT OF TAXES AND CLAIMS. The Borrowers and their
Subsidiaries shall pay or cause to be paid (i) all taxes, assessments and other
governmental charges imposed upon them or on any of their respective properties
or assets or in respect of any of their respective franchises, business, income
or property before any material penalty or interest accrues thereon and (ii) all
Claims (including, without limitation, claims for labor, services, materials and
supplies) for sums material in the aggregate to the Borrowers and their
Subsidiaries which have become due and payable and which by Law have or may
become a Lien (other than a Customary Permitted Lien) upon the Borrowers' and/or
their Subsidiaries' Property, prior to time when any penalty or fine shall be
incurred with respect thereto; PROVIDED, HOWEVER, that no such taxes,
assessments and governmental charges referred to in CLAUSE (i) above or Claims
referred to in CLAUSE (ii) above need be paid if being contested in good faith
by appropriate proceedings promptly instituted and diligently conducted and if
adequate reserves shall have been set aside therefor in accordance with
Generally Accepted Accounting Principles.
SECTION 6.05 MAINTENANCE OF PROPERTIES; INSURANCE. The Borrowers and their
Subsidiaries shall maintain or cause to be maintained in good repair, working
order and condition, excepting ordinary wear and tear, all of their respective
Properties material to their operations and will make or cause to be made all
appropriate repairs, renewals and replacements thereof, consistent with past
practice. The Borrowers and their Subsidiaries shall maintain or cause to be
maintained with financially sound and reputable insurers reasonably acceptable
to the Administrative Agent and the Canadian Collateral Agent, the insurance
policies and programs listed on SCHEDULE 6.05 attached hereto or substantially
similar programs or policies and amounts or other programs, policies and amounts
acceptable to the Administrative Agent, the US Collateral Agent and the Canadian
Collateral Agent and shall, in connection with such insurance policies and
programs, name the Administrative Agent, the US Collateral Agent and/or the
Canadian Collateral Agent, as required by the Administrative Agent, each for the
benefit of the Lenders, as "additional insured" and as "loss payee". Not later
than thirty (30) days later than the renewal, replacement or material
modification of any policy or program, the Borrowers shall deliver or cause to
be delivered to the Administrative Agent a certificate of insurance setting
forth for each such policy or program: (i) the amount of such policy, (ii) the
risks insured against by such policy, (iii) the name of the insurer and each
insured party under such policy and (iv) the policy number of such policy. Upon
the request of the Administrative Agent, the US Borrowers shall further provide
to the Administrative Agent, and upon the request of the Canadian Collateral
Agent, the Canadian Borrower shall further provide to the Canadian Collateral
Agent, copies of each of their insurance policies and programs, together with
any and all exhibits and schedules.
SECTION 6.06 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS.
Except for information and records which the Borrowers may not under applicable
Law disseminate or disclose to the Agents and/or the Lenders, the Borrowers and
their Subsidiaries shall permit any authorized representative(s) designated by
the Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and/or the Lenders to visit, to conduct a field audit (which field audit shall
be separate and apart from the field audit required under SECTION 5.05 above) or
to otherwise inspect any of the Borrowers' and/or their Subsidiaries' respective
Properties, including their financial and accounting records, and to make copies
and take extracts therefrom, and to discuss the Borrowers' and/or their
Subsidiaries' respective affairs, finances and accounts with the Administrative
Agent's, the US Collateral Agent's, the Canadian Collateral Agent's and/or the
Lenders' respective officers, employees, representatives or independent
certified public accountants, upon reasonable notice and during normal business
hours. All information furnished to the Administrative Agent, the US Collateral
Agent, the Canadian Collateral Agent and/or the Lenders shall be received and
maintained by the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and the Lenders in strict confidence and in accordance with
applicable Law, and they shall not disseminate said information to any Person
except where required by and in accordance with applicable Law or where
contemplated by the Loan Documents. The Administrative Agent, the US Collateral
Agent, the Canadian Collateral Agent and the Lenders hereby agree that they
shall not take any action or omit to take any action which would cause or result
in the violation of Law (including without limitation, any export control law)
by the Borrowers and their Subsidiaries. Except with respect to the field
examinations and collateral audits provided for in SECTION 5.05 of this Loan
Agreement and except with respect to such inspections and/or visitations which
are made by or on behalf of any of the Agents and/or the Lenders upon the
occurrence and during the continuance of an Event of Default (the costs of which
are to be borne SOLELY by the Borrowers), one such visitation and inspection per
calendar year by or on behalf of one of the Administrative Agent, the US
Collateral Agent and/or the Canadian Collateral Agent shall be at the Borrowers'
own cost and expense and all other such visitations and inspections shall be at
the Agents' and/or the Lenders' expense.
SECTION 6.07 LITIGATION, CLAIMS, ETC. The Borrowers shall provide the
Administrative Agent and the Canadian Collateral Agent with (i) a litigation
status report with respect to any suit at law or in equity asserted against it
of the type referred to in SCHEDULE 4.01(vii) attached hereto, in form and
substance satisfactory to the Administrative Agent, promptly after the close of
each calendar quarter; (ii) notice of any suit at law or in equity or claim
brought or asserted against the Borrowers and/or their Subsidiaries promptly
after learning thereof with respect to any suit or claim involving money or
property valued in excess of US$100,000.00 or any such suits or claims which IN
THE AGGREGATE involve money or property valued in excess of US$250,000.00; and
(iii) prompt notice of any investigation or proceeding before or by any
Governmental Authority, the effect of which is reasonably likely to have a
Material Adverse Effect.
SECTION 6.08 LABOR DISPUTES. The Borrowers shall notify the Administrative
Agent and the Canadian Collateral Agent in writing, promptly, but in any event
within two (2) Business Days after learning thereof, of any material labor
dispute to which the Borrowers and/or their Subsidiaries may become a party, any
strikes or walkouts relating to any of their Properties and the expiration of
any labor contract to which they are a party or by which they are bound.
SECTION 6.09 MAINTENANCE OF LICENSES, PERMITS, ETC. The Borrowers (i)
shall maintain in full force and effect, and shall cause each of their
Subsidiaries, to maintain in full force and effect, all licenses, permits,
governmental approvals, franchises, authorizations or other rights necessary for
the operation of the Borrowers' and/or their Subsidiaries' businesses, except
where the failure to obtain any of the foregoing would not have or is not
reasonably likely to have a Material Adverse Effect and (ii) shall notify the
Administrative Agent and the Canadian Collateral Agent in writing, promptly
after learning thereof, of the suspension, cancellation, revocation or
discontinuance of or of any pending or threatened action or proceeding seeking
to suspend, cancel, revoke or discontinue any such license, permit, governmental
approval, franchise authorization or right, where the result thereof could
reasonably be expected to have a Material Adverse Effect.
SECTION 6.10 USE OF PROCEEDS. The Borrowers shall not use the proceeds of
any Loans hereunder directly or indirectly for any unlawful purpose, in any
manner inconsistent with the provisions of SECTION 2.01(iv), SECTION 2.02(iv),
SECTION 2.03(iv) and/or SECTION 2.04 of this Loan Agreement, or inconsistent
with any other provision of any other Loan Document.
SECTION 6.11 CONTINUATION OF OR CHANGE IN BUSINESS. The Borrowers and
their Subsidiaries shall continue to engage in their collective businesses
substantially as conducted and operated during the present and preceding Fiscal
Year, and the Borrowers and their Subsidiaries shall not engage in any other
businesses.
SECTION 6.12 ADDITIONAL US BORROWERS AND ADDITIONAL CORPORATE GUARANTORS.
The US Borrowers shall cause any of their domestic Subsidiaries which are
acquired or formed after the Closing Date (i) to execute this Loan Agreement
and/or any and all other documents, agreements, statements, certificates and
information as the Lenders may reasonably require to add such Subsidiary as a
"US Borrower" and, in connection therewith, to become fully and unconditionally
liable, on a JOINT AND SEVERAL BASIS with all of the other US Borrowers, for all
of the Obligations of the US Borrowers to the Administrative Agent, the US
Collateral Agent and the US Lenders for and in connection with the US Revolving
Credit Loan Facility and the Acquisition/Term Loan Facility, (ii) to execute a
Security Agreement for the purposes of assigning, hypothecating, pledging,
conveying, transferring, giving and granting to the US Collateral Agent, for the
benefit of the US Lenders, a continuing security interest in all of the rights,
title and interests of such domestic Subsidiary in and to certain of its assets
and properties (including, without limitation, such domestic Subsidiary's
Accounts, Inventory and Equipment) as additional collateral security for the US
Revolving Credit Loan Facility, the Acquisition/Term Loan Facility and their
obligations under and in connection with the Agreements of Guaranty described in
CLAUSE (iii) below, (iii) to execute an Agreement of Guaranty in favor of the
Administrative Agent, for the benefit of Summit Bank and Mellon US, pursuant to
which such domestic Subsidiary shall guaranty, ON A JOINT AND SEVERAL BASIS with
all of the other Corporate Guarantors, all of the obligations of the Canadian
Borrower in connection with the F/X Line of Credit Facility, (iv) to execute a
Security Agreement for the purposes of assigning, hypothecating, pledging,
conveying, transferring, giving and granting to the Canadian Collateral Agent,
for the benefit of the Canadian Lenders, a continuing security interest in all
of the rights, title and interests of such domestic Subsidiary in and to certain
of its assets and properties (including, without limitation, such domestic
Subsidiary's Accounts, Inventory and Equipment) as additional collateral
security for their obligations under and in connection with the Agreements of
Guaranty described in CLAUSE (v) below, and (v) to execute an Agreement of
Guaranty in favor of the Canadian Collateral Agent, for the benefit of the
Canadian Lenders, pursuant to which such domestic Subsidiary shall guaranty, ON
A JOINT AND SEVERAL BASIS with all of the other Corporate Guarantors, all of the
obligations of the Canadian Borrower in connection with the Canadian Revolving
Credit Loan Facility. In addition, Cantel Medical shall execute a Pledge of
Stock Agreement, in form and substance satisfactory to the Administrative Agent
in its sole and absolute discretion, pledging one-hundred percent (100%) of the
authorized, issued and outstanding voting capital stock of any domestic
Subsidiary which is acquired or formed by Cantel Medical after the Closing Date
as additional collateral security for the US Revolving Credit Loan Facility and
the Acquisition/Term Loan Facility and all of the other Obligations of Cantel
Medical under any of the Agreements of Guaranty.
SECTION 6.13 MINIMUM REQUIRED INTEREST RATE HEDGE PROTECTION. Within
ninety (90)
days after the first advance of proceeds of the Acquisition/Term Loan Facility,
the US Borrowers shall enter into the Master Agreement and shall maintain said
Master Agreement for an initial period of up to seven (7) years. The Master
Agreement shall have a minimum value at all times during the term of the
Acquisition/Term Loan Facility equal to at least fifty percent (50%) of the
aggregate principal amount outstanding under or in connection with the
Acquisition/Term Loan Facility from time to time and shall contain other terms
satisfactory to the Administrative Agent, in its sole and absolute discretion.
SECTION 6.14 BANK OF ACCOUNT FOR BORROWERS. Cantel Medical shall maintain
its principal operating accounts with Summit Bank at all times during the term
of the Loan Facilities.
SECTION 6.15 LANDLORD SUBORDINATION AND WAIVER AGREEMENTS. The Borrowers
shall use their best efforts to obtain a Landlord Subordination and Waiver
Agreement from (i) all landlords under all Agreements of Lease and (ii) each
future landlord of all Properties leased under any agreement of lease at which
all or any portion of the Collateral is located.
SECTION 6.16 OWNERSHIP OF SUBSIDIARIES. Cantel Medical shall maintain the
ownership of one hundred percent (100%) of the authorized, issued and
outstanding voting capital stock of each of (i) MediVators, (ii) Carsen Group
and (iii) any other wholly owned Subsidiaries formed or acquired by Cantel
Medical after the Closing Date.
SECTION 6.17 INACTIVE SUBSIDIARIES. Cantel Medical shall cause Wellspring,
Inc., a Delaware corporation, a Subsidiary of Cantel Medical, to remain inactive
while any of the Loan Facilities are outstanding, owning no assets (other than
certain net operating losses), having no liabilities and conducting no business
operations.
ARTICLE VII
NEGATIVE COVENANTS
The Borrowers hereby covenant and agree that, on and after the Closing
Date and so long as any Lender shall have any obligation hereunder and until
payment in full of all of the Obligations, unless the Requisite Lenders shall
give their prior express written consent otherwise, that:
SECTION 7.01 CONSOLIDATED DEBT. None of the Borrowers or any of their
Subsidiaries shall directly or indirectly create, incur, assume or otherwise
become or remain directly or indirectly liable with respect to, any Consolidated
Debt, except for:
(i) the Obligations;
(ii) the permitted existing Consolidated Debt as described on
SCHEDULE 7.01(iii) attached hereto, and extensions, renewals, replacements and
refinancing thereof, not exceeding the principal amount outstanding on the date
of such extension, renewal, replacement or refinancing, provided that the terms
are no less advantageous to the Borrowers and/or their Subsidiaries than the
predecessor obligation;
(iii) Consolidated Debt in respect of guarantees permitted by
SECTION 7.11 hereof; and
(iv) Consolidated Debt in connection with purchase money Liens
permitted by SECTION 7.02(ii)(e) hereof.
SECTION 7.02 SALES OF ASSETS; LIENS.
(i) SALES. None of the Borrowers or any of their Subsidiaries shall
sell, assign, transfer, lease, convey, abandon or otherwise dispose of,
voluntarily or involuntarily, any Properties, whether now owned or hereafter
acquired, or any income or profits therefrom, except:
(a) sales of Inventory in the ordinary course of their
respective businesses; and/or
(b) sales of any Properties having net sales proceeds of up to
US$250,000.00 per Fiscal Year in the aggregate as amongst all of the Borrowers
and their Subsidiaries (and the Administrative Agent, the US Collateral Agent,
the Canadian Collateral Agent and the Lenders hereby agree to release their
security interest in and to any Collateral which is sold for no consideration);
PROVIDED, HOWEVER, that, notwithstanding anything contained in the foregoing
CLAUSES (a) AND (b)
to the contrary, none of the Borrowers or any of their Subsidiaries shall sell,
assign, transfer, lease, convey, abandon or otherwise dispose of, voluntarily or
involuntarily, any of their respective Properties, whether now owned or
hereafter acquired, or any income or profits therefrom, to Wellspring, Inc.
(ii) LIENS. None of the Borrowers or any of their Subsidiaries shall
directly or indirectly create, incur, assume or permit to exist any Lien on or
with respect to any of their respective Properties except:
(a) Liens securing the Obligations;
(b) any interest or title of a lessor or secured by a lessor's
interest under any lease permitted by this Loan Agreement; PROVIDED, HOWEVER,
that any such Lien is limited to the property being leased;
(c) Liens existing on the date of this Loan Agreement securing
any of the existing Consolidated Debt described on SCHEDULE 7.01(iii) attached
hereto (but said Liens may not be increased in principal amount);
(d) Customary Permitted Liens; and
(e) purchase money Liens securing Consolidated Debt (including
the interest of a lessee under a Capitalized Lease), in connection with the
purchase of seller-financed Equipment where such Liens are limited to such
Equipment being purchased, in the aggregate principal amount outstanding at any
time not to exceed US$100,000.00 as amongst all of the Borrowers and their
Subsidiaries.
SECTION 7.03 LOANS, ADVANCES AND INVESTMENTS. None of the Borrowers or any
of their Subsidiaries shall (i) make or suffer to exist or remain outstanding,
any loan or advance to any other Person, OR (ii) purchase, acquire or own
(beneficially or of record) any stock, bonds, notes or securities of, or any
partnership interest (whether general or limited) in, or any other interest in,
any other Person, OR (iii) make any capital contribution to or other investment
in any other Person OR (iv) agree, become or remain liable (contingent or
otherwise) to do any of the foregoing, except:
(a) Loans and investments existing on the date hereof and
listed in SCHEDULE 7.03 attached hereto and extensions, renewals and refinancing
thereof on terms no less favorable than those existing immediately before such
extension, renewal or refinancing);
(b) Accounts receivable owing to the Borrowers and their
Subsidiaries arising from sales of inventory under usual and customary terms in
the ordinary course of business and loans and advances extended by the Borrowers
and/or their Subsidiaries to subcontractors or suppliers (excluding
subcontractors or suppliers who are Subsidiaries) under
usual and customary terms in the ordinary course of business;
(c) Provided no Event of Default and no Potential Event of
Default presently exists and would not result from the making thereof, loans
from any of the Borrowers and/or their Subsidiaries to any of the other
Borrowers and/or their Subsidiaries;
(d) Provided no Event of Default and no Potential Event of
Default presently exists and would not result from the making thereof, loans or
advances not to exceed US$100,000.00 in the aggregate at any time outstanding as
amongst all of the Borrowers and their Subsidiaries, made in the ordinary course
of business to officers or other employees of any of the Borrowers and/or their
Subsidiaries;
(e) Investments in Cash or Cash Equivalents;
(f) Investments in connection with Permitted Acquisitions; and
(g) "Available-for-sale securities" (as such term is defined
in Generally Accepted Accounting Principles) in Persons who are potential
acquisition candidates, in an amount not to exceed $1,500,000.00 in the
aggregate at any one time as amongst all of the Borrowers and the Subsidiaries.
SECTION 7.04 RESTRICTED JUNIOR PAYMENTS. None of the Borrowers or any of
their Subsidiaries shall declare or make any Restricted Junior Payment, EXCEPT
(i) they may distribute shares of their capital stock to any Person or the
owners of said Person in connection with a Permitted Acquisition of said Person,
(ii) they may make repayments and prepayments of the Loan Facilities in
accordance with the terms, conditions and provisions of this Loan Agreement,
(iii) they may make dividends and distributions payable SOLELY in their common
stock, (iv) they may make Restricted Junior Payments to (a) one of the Borrowers
or (b) any Subsidiary of Cantel Medical, one hundred percent (100%) of whose
stock has been pledged to the Administrative Agent, for the benefit of the US
Lenders, under any of the Pledge of Stock Agreements and (v) Carsen Group and/or
MediVators may make cash dividends to Cantel Medical but ONLY to the extent that
one hundred percent (100%) of such dividends are returned by Cantel Medical to
Carsen Group and/or MediVators, as applicable, in cash, within thirty (30) days
of their having been made; PROVIDED THAT, as conditions precedent to the ability
of Carsen Group and/or MediVators to make such cash dividends, all of the
following shall have been complied with: (a) no Event of Default or Potential
Event of Default shall have occurred and be continuing and no other Event of
Default or Potential Event of Default shall result or be caused by the payment
of such cash dividend and (b) all of the financial covenants set forth in
ARTICLE VIII of this Loan Agreement must be complied with by the Borrowers on
both a pro forma combined basis for the then current period and on a projected
basis, after taking into account the payment of such cash dividend.
SECTION 7.05 RESTRICTION ON FUNDAMENTAL CHANGES. None of the Borrowers or
any of
their Subsidiaries shall enter into any merger, acquisition or consolidation, or
liquidate, windup or dissolve (or suffer any liquidation or dissolution), or
convey, lease, sell, transfer or otherwise dispose of, in one transaction or
series of transactions, all or any substantial part of their respective
businesses, properties or assets, whether now or hereafter acquired EXCEPT (i)
as permitted by SECTION 7.02(i) hereof, (ii) for mergers of any Subsidiary into
(a) any of the Borrowers or (b) another Subsidiary (EXCEPT for Wellspring, Inc.)
and (iii) in connection with any Permitted Acquisition or in connection with any
other merger, consolidation, joint venture, partnership or acquisition which is
approved in advance and in writing by one hundred percent (100%) of the Lenders.
None of the Subsidiaries of any of the Borrowers shall form, acquire, have or
otherwise create any Subsidiaries nor shall Cantel Medical form, acquire, have
or otherwise create any foreign Subsidiaries other than Carsen Group without the
prior express written consent of the Requisite Lenders.
SECTION 7.06 ERISA. None of the Borrowers or any of their Subsidiaries
shall, and none of the Borrowers shall permit any of their ERISA Affiliates to,
do any of the following to the extent that such act or failure to act would
result in the aggregate, after taking into account any other such acts or
failure to act, in an obligation to pay a sum of money that is material to the
business of the Borrowers and their Subsidiaries:
(i) Engage, or permit an ERISA Affiliate to engage, in any
prohibited transaction described in Section 406 of ERISA or Section 4975 of the
Code for which a class exemption is not available or a private exemption has not
been obtained from the DOL;
(ii) Permit to exist any accumulated funding deficiency (as defined
in Section 302 of ERISA and Section 412 of the Code), whether or not waived;
(iii) Fail, or permit an ERISA Affiliate to fail, to pay timely
required contributions or annual installments due with respect to any waived
funding deficiency to any Plan;
(iv) Terminate, or permit an ERISA Affiliate to terminate, any
Benefit Plan which would result in any liability of the Borrowers, their
Subsidiaries or an ERISA Affiliate under Title IV of ERISA; or
(v) Fail, or permit any ERISA Affiliate to fail, to pay any required
installment under section (m) of Section 412 of the Code or any other payment
required under Section 412 of the Code on or before the due date for such
installment or other payment.
SECTION 7.07 AMENDMENT OF CERTIFICATE OR ARTICLES OF INCORPORATION,
MEMORANDUM AND ARTICLES OF ASSOCIATION AND/OR BY-LAWS. None of the Borrowers or
any of their Subsidiaries shall materially amend, modify or supplement their
respective articles of incorporation, memorandum and articles of association
and/or by-laws, except upon at least ten (10) days' prior express written notice
to the Administrative Agent.
SECTION 7.08 MARGIN REGULATIONS. No portion of the proceeds of any credit
extended under this Loan Agreement shall be used in any manner which might cause
the extension of credit or the application of such proceeds to violate
Regulation U or Regulation X or any other regulation of the Federal Reserve
Board or to violate the Securities Exchange Act or the Securities Act, in each
case as in effect on the date or dates of such Borrowing and such use of
proceeds.
SECTION 7.09 CANCELLATION OF CONSOLIDATED DEBT; PREPAYMENT. None of the
Borrowers or any of their Subsidiaries shall cancel any Claim or Consolidated
Debt (except for adequate consideration and in the ordinary course of their
respective businesses) and shall not prepay any Consolidated Subordinated Debt;
PROVIDED, HOWEVER, that the foregoing shall not prohibit the prepayment of the
Obligations in accordance with the terms, conditions and provisions of this Loan
Agreement or the refinance of any Consolidated Subordinated Debt in amounts and
on terms and conditions equal to or better than the existing terms and
conditions.
SECTION 7.10 ENVIRONMENTAL LIABILITIES. None of the Borrowers or any of
their Subsidiaries shall become subject to any Liabilities and Costs which the
Administrative Agent and/or the Canadian Collateral Agent deems has or is likely
to have a Material Adverse Effect arising out of or related to (i) the Release
or threatened Release at any location of any Environmental Concern Material into
the Environment, or any Remedial Action in response thereto, or (ii) any
violation of any Environmental, health or safety Requirement of Law; PROVIDED,
HOWEVER, that this covenant shall not be violated so long as (a) the Borrowers
and their Subsidiaries shall have notified the Administrative Agent and the
Canadian Collateral Agent of the assertion of such liability or required
expenditures promptly upon receiving written notice of such assertion, (b) the
Borrowers shall have continued to furnish the Administrative Agent and the
Canadian Collateral Agent with such information concerning such asserted
liability or required expenditure as the Administrative Agent and/or the
Canadian Collateral Agent shall have reasonably requested, or as otherwise
provided herein, (c) the Borrowers and their Subsidiaries shall be diligently
pursuing indemnification for such liability or required expenditures from any
Person which has an obligation to provide such indemnification, and (d) the
Administrative Agent and the Canadian Collateral Agent are satisfied that the
imposition of such liability during the pendency of the Borrowers' or their
Subsidiaries' pursuit of indemnification will not materially impair the
Borrowers' or its Subsidiaries' ability to perform their respective obligations,
whether financial or otherwise, under this Loan Agreement.
SECTION 7.11 GUARANTIES. None of the Borrowers or any of their
Subsidiaries shall assume, guaranty, endorse or otherwise be or become directly
or contingently responsible or liable, for obligations or liabilities of any
Person, except for:
(i) guaranties existing on the Closing Date as described on SCHEDULE
7.11(i) attached hereto; and
(ii) guaranties by endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of business; and
(iii) guaranties of any additional Consolidated Debt which is
permitted under SECTION 7.01; and
(iv) guaranties of Operating Leases which are permitted pursuant to
the terms, conditions and provisions of SECTION 7.13 below.
SECTION 7.12 NO NEGATIVE PLEDGES TO OTHER PERSONS. None of the Borrowers
or any of their Subsidiaries shall grant to another Person a covenant commonly
referred to as a "negative pledge" with respect to any of their respective
assets and/or Properties.
SECTION 7.13 OPERATING LEASES. None of the Borrowers or any of their
Subsidiaries shall, during any Fiscal Year, become liable in any way, whether
directly or by assignment, for the obligations of a lessee under any Operating
Lease, EXCEPT for (i) all currently existing Operating Leases including, without
limitation, and extensions, renewals and refinancings thereof on terms no less
favorable than those existing immediately prior to such extension, renewal or
refinancing, (ii) new Operating Leases of any property (whether real or personal
or mixed); PROVIDED, HOWEVER, that immediately after giving effect to the
incurrence of liability with respect to any such Operating Lease, the aggregate
amount of all rental payments or accruals for such Fiscal Year on all Operating
Leases for the Borrowers and their Subsidiaries shall not exceed US$750,000.00,
WITHOUT taking into account any customary reimbursement for taxes, insurance or
maintenance expenses.
SECTION 7.14 SALES AND LEASEBACKS. None of the Borrowers or any of their
Subsidiaries shall become liable, directly or indirectly, with respect to any
lease, whether an Operating Lease or a Capital Lease, of any property (whether
real or personal or mixed) whether now owned or hereafter acquired, (i) which
any of the Borrowers and/or their Subsidiaries has sold or transferred or is to
sell or transfer to any other Person or (ii) which any of the Borrowers and/or
their Subsidiaries intends to use for substantially the same purposes as any
other property which has been or is to be sold or transferred to any other
Person in connection with such lease.
SECTION 7.15 FISCAL YEARS. None of the Borrowers or any of their
Subsidiaries shall change its respective Fiscal Years.
ARTICLE VIII
FINANCIAL COVENANTS
The Borrowers hereby covenant and agree that, on and after the Closing
Date so long as any Lender has any Commitment hereunder and until payment in
full of all the Obligations, unless the Requisite Lenders shall give their prior
express written consent otherwise, then:
SECTION 8.01 MINIMUM CONSOLIDATED TANGIBLE NET WORTH. Each of (i) Cantel
Medical and its Subsidiaries, (ii) MediVators and all of the domestic
Subsidiaries of Cantel Medical and (iii) Carsen Group, respectively, shall
maintain at all times during the term of the Loan Facilities (which covenant may
be tested by the Administrative Agent at any time but in any event shall always
be tested as of the end of the periods covered by the annual consolidated and
consolidating financial statements which are to be provided to the
Administrative Agent pursuant to SECTION 5.02 of this Loan Agreement), a minimum
Consolidated Tangible Net Worth of at least the applicable amount set forth
below for each corresponding test date:
(a) CANTEL MEDICAL AND ITS SUBSIDIARIES:
FISCAL YEAR ENDED MINIMUM CONSOLIDATED TANGIBLE NET WORTH
July 31, 2000 US$15,818,000.00
Thereafter *
(b) MEDIVATORS AND ALL OF THE DOMESTIC SUBSIDIARIES OF CANTEL MEDICAL:
FISCAL YEAR ENDED MINIMUM CONSOLIDATED TANGIBLE NET WORTH
July 31, 2000 US$4,161,000.00
Thereafter *
(c) CARSEN GROUP:
FISCAL YEAR ENDED MINIMUM CONSOLIDATED TANGIBLE NET WORTH
July 31, 2000 US$13,845,000.00
Thereafter *
* For each Fiscal Year after the Fiscal Year ended on July 31, 2000, each
of the above-referenced Persons shall maintain a minimum Consolidated Tangible
Net Worth of not less than an amount equal to the sum of (1) the minimum actual
Consolidated Tangible Net Worth for such Person(s) as of the last day of the
Fiscal Year then ended PLUS (2) seventy-five percent (75%) of the Consolidated
Net Income (profits but NOT losses) such Person(s) for each said Fiscal Year
then ended, PLUS (3) one hundred percent (100%) of the net proceeds received by
such Person(s) during the immediately preceding Fiscal Year (A) from the equity
issuance of their capital stock to Persons other than the Borrowers and/or their
respective Subsidiaries and (B) from the conversion of any Consolidated
Subordinated Debt of such Person(s) into equity and MINUS (4) all amounts paid
by Cantel Medical during the immediately preceding Fiscal Year in connection
with the repurchase of any of Cantel Medical's stock pursuant to any Stock
Repurchase Program in an amount not to exceed US$1,000,000.00 in the aggregate
at any time during the term of the US Revolving Credit Loan Facility.
SECTION 8.02 MAXIMUM CONSOLIDATED FUNDED DEBT LEVERAGE RATIO. Each of (i)
Cantel Medical and its Subsidiaries, (ii) MediVators and all of the domestic
Subsidiaries of Cantel Medical and (iii) Carsen Group, respectively, shall have
on the last day of each Fiscal Quarter and each Fiscal Year (which covenant
shall be tested at the end of the periods covered by
the quarterly and annual consolidated and consolidating financial statements
which are to be provided to the Administrative Agent pursuant to SECTION 5.02 of
this Loan Agreement), a Consolidated Funded Debt Leverage Ratio equal to or less
than 2.5 -to- 1.0.*
* For purposes of this SECTION 8.02, the Consolidated Funded Debt Leverage
Ratio for such Persons shall be calculated using the Consolidated EBITDA of such
Persons for the prior twelve (12) consecutive months and the interest expense on
the Consolidated Debt of such Persons for the prior twelve (12) consecutive
months. Consolidated EBITDA for any Person shall be a pro forma historical
Consolidated EBITDA to account for any mergers or acquisitions.
SECTION 8.03 MINIMUM CONSOLIDATED INTEREST COVERAGE RATIO. Each of (i)
Cantel Medical and its Subsidiaries, (ii) MediVators and all of the domestic
Subsidiaries of Cantel Medical and (iii) Carsen Group, respectively, shall have
on the last day of each Fiscal Quarter and each Fiscal Year (which covenant
shall be tested at the end of the periods covered by the quarterly and annual
consolidated and consolidating financial statements which are to be provided to
the Administrative Agent pursuant to SECTION 5.02 of this Loan Agreement), a
Consolidated Interest Coverage Ratio equal to or greater than 3.0 -to- 1.0.*
* For purposes of this SECTION 8.03, the Consolidated Interest Coverage
Ratio for such Persons shall be calculated using the Consolidated EBIT of such
Persons of the prior twelve (12) consecutive months and the Consolidated Debt of
such Persons as of the actual day of the calculation. Consolidated EBIT for any
Person shall be a pro forma historical Consolidated EBIT to account for any
mergers or acquisitions.
SECTION 8.04 MINIMUM CONSOLIDATED FIXED CHARGE COVERAGE RATIO. Each of (i)
Cantel Medical and its Subsidiaries, (ii) MediVators and all of the domestic
Subsidiaries of Cantel Medical and (iii) Carsen Group, respectively, shall have
on the last day of each Fiscal Quarter and each Fiscal Year (which covenant
shall be tested at the end of the periods covered by the quarterly and annual
consolidated and consolidating financial statements which are to be provided to
the Administrative Agent pursuant to SECTION 5.02 of this Loan Agreement), a
Consolidated Fixed Charge Coverage Ratio equal to or greater than 1.25 -to- 1.0.
SECTION 8.05 MAXIMUM CAPITAL EXPENDITURES. Capital Expenditures made or
incurred by the Borrowers and their Subsidiaries in each Fiscal Year during the
term of the Loan Facilities shall not exceed US$750,000.00 per Fiscal Year in
the aggregate.
ARTICLE IX
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
SECTION 9.01 EVENTS OF DEFAULT. The occurrence of any of the following
events with the passing of any applicable notice and cure periods shall
constitute an "Event of Default" under this Loan Agreement (hereinafter referred
to as an "Event of Default"):
(i) Any representation or warranty made by any one or more of the
Borrowers, the Corporate Guarantor or any other Person in any of the Loan
Documents furnished in connection with the Loan Facilities, shall prove to have
been false, incorrect or misleading in any substantial and material respect on
the date as of which made;
(ii) Any one or more of the Borrowers shall have failed to make any
payment of any fee payable hereunder or any installment of interest on any of
the Notes, the Letters of Credit Reimbursement Agreement and/or under this Loan
Agreement on their respective due dates and such default shall have remained
uncured for a period of three (3) days;
(iii) Any one or more of the Borrowers shall have failed to make any
payment of principal on any of the Notes, the Letters of Credit Reimbursement
Agreement and/or under this Loan Agreement on their respective due dates and
such default shall have remained uncured for a period of three (3) days;
(iv) Any one or more of the Borrowers or the Corporate Guarantor
shall have failed to duly observe or perform any covenant, condition or
agreement with respect to the payment of monies on the part of such Borrower(s)
or the Corporate Guarantor to be observed or performed pursuant to the terms of
the Loan Documents, other than the payment of principal and interest which shall
be governed by SECTION 9.01(ii) AND (iii) above, and such default shall have
remained uncured for a period of fifteen (15) days after written notice thereof
to such Borrower(s) or the Corporate Guarantor from the Administrative Agent;
(v) The Borrowers shall have failed to duly observe any of the
financial covenants set forth in ARTICLE VIII of this Loan Agreement as of any
date of determination;
(vi) Any one or more of the Borrowers and/or the Corporate Guarantor
shall have failed to duly observe or perform any covenant, condition or
agreement on the part of such Borrower(s) or the Corporate Guarantor to be
observed or performed pursuant to the terms of the Loan Documents other than the
payment of monies which shall be governed by SECTION 9.01 (ii), (iii) AND (iv)
above, and such default shall have remained uncured for a period of fifteen (15)
days after written notice thereof to such Borrower(s) or the Corporate Guarantor
from the Administrative Agent;
(vii) Any one or more of the Borrowers and/or the Corporate
Guarantor shall have applied for or consented to the appointment of a custodian,
receiver, trustee or liquidator of all or a substantial part of their respective
assets; a custodian shall have been appointed with or without consent of such
Borrower(s) and/or the Corporate Guarantors; any of the Borrowers and/or the
Corporate Guarantor shall generally not be paying their respective Debts as they
become due; any of the Borrowers and/or the Corporate Guarantor shall have made
a general assignment for the benefit of their respective creditors; any of the
Borrowers and/or the Corporate Guarantor, shall have filed a voluntary petition
(or assignment) in bankruptcy, or a petition or an answer seeking reorganization
or an arrangement with their respective creditors, or shall have taken advantage
of any insolvency law, or shall have filed an answer admitting the material
allegations of a petition in bankruptcy, reorganization or insolvency
proceeding; or a petition in bankruptcy shall have been filed against any one or
more of the Borrowers and/or the Corporate Guarantor and shall not have been
dismissed for a period of sixty (60) consecutive days; or an Order for Relief or
Receiving Order or Interim Order shall have been entered against any of the
Borrowers and/or the Corporate Guarantor under either the Bankruptcy Code or the
Bankruptcy Act; or an order, judgment or decree shall have been entered without
the application, approval or consent of any of the Borrowers and/or the
Corporate Guarantor by any court of competent jurisdiction appointing a
receiver, trustee, custodian or liquidator of any of the Borrowers and/or the
Corporate Guarantor of a substantial part of their respective assets and such
order, judgment or decree shall have continued unstayed and in effect for any
period of sixty (60) consecutive days; or any proceeding shall have been
commenced in respect of any of the Borrowers or the Corporate Guarantor under
the Companies Creditors Arrangement Act (Canada);
(viii) A writ of execution or attachment or any similar process
shall be issued or levied against all or any part of or interest in any of the
Properties of any one or more of the Borrowers and/or the Corporate Guarantor or
any judgment involving monetary damages shall be entered against any one or more
of the Borrowers and/or the Corporate Guarantor which shall become a lien on any
one or more of the Borrowers' and/or the Corporate Guarantor's Properties or any
portion thereof or interest therein and such execution, attachment or similar
process is not released, bonded, satisfied, vacated or stayed within thirty (30)
days after its entry or levy, and said writ of execution, attachment, levy or
judgment shall involve monetary damages aggregating more than US$100,000.00;
(ix) Seizure or foreclosure of any of the Properties of any one or
more of the Borrowers and/or the Corporate Guarantor pursuant to process of law
or by respect of legal self-help, involving monetary damages aggregating more
than US$100,000.00, unless said seizure or foreclosure is stayed or bonded
within thirty (30) days after the occurrence of same;
(x) The voluntary permanent closing of business or ceasing of
operations of any one or more of the Borrowers, the result of which would have a
Material Adverse Effect which would result in or cause the Lenders to believe,
in their reasonable discretion, that the Borrowers would not be able to repay
their debts as they arise, including, without limitation, the
Loan Facilities;
(xi) Default by any one or more of the Borrowers and/or the
Corporate Guarantor in any of the terms or conditions of any agreement
(excluding the Loan Documents) covering the payment of borrowed money from the
Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent,
any Lender and/or any other creditor, which shall be in an aggregate principal
amount involving not less than US$100,000.00;
(xii) The occurrence of a Material Adverse Change in the business,
financial condition, financial performance, properties or operations of any one
or more of the Borrowers, taken as a whole, which would result in or cause the
Lenders to believe, in their reasonable discretion, that the Borrowers would not
be able to repay their debts as they arise, including, without limitation, the
Loan Facilities;
(xiii) The occurrence of a Reportable Event, the result of which
would have a Material Adverse Effect;
(xiv) Any one or more of the Borrowers and/or the Corporate
Guarantor shall have transferred, or caused to have been transferred, title to
or possession of any interest in the Collateral, or any part thereof, to any
person or entity, without the prior express written consent of the Requisite
Lenders, except as may be expressly permitted under SECTION 7.02(i) of this Loan
Agreement;
(xv) Any one or more of the Borrowers and/or the Corporate Guarantor
shall have consented to the placing of any additional lien on the Collateral,
whether such lien is prior to or subordinate to the lien of the US Collateral
Agent and/or the Canadian Collateral Agent, respectively;
(xvi) The occurrence of a Change of Control; and
(xvii) An event of default shall have occurred under any of the
other Loan Documents.
SECTION 9.02 RIGHTS AND REMEDIES.
(i) ACCELERATION. Upon the occurrence and during the continuance of
any Event of Default described in the foregoing SECTION 9.01(vii) hereof, the
Commitments shall automatically and immediately terminate and the unpaid
principal amount of, and any and all accrued interest on, the Loans, all US
Reimbursement Obligations, the undiscounted face amount of all outstanding
Canadian Bankers Acceptances and all Canadian Reimbursement Obligations shall
automatically become immediately due and payable, with all additional interest
from time to time accrued thereon and without presentment, demand, or protest or
other requirements of any kind (including, without limitation, valuation and
appraisement, diligence, presentment,
notice of intent to demand or accelerate and of acceleration), all of which are
hereby expressly waived by the Borrowers and their Subsidiaries, and the
obligation of each of the Lenders to make any additional Loans, issue any
additional Letters of Credit, create any additional Canadian Bankers Acceptances
and/or purchase any Foreign Exchange Contracts hereunder shall thereupon
terminate. Upon the occurrence and during the continuance of any other Event of
Default described in SECTION 9.01 above, the Administrative Agent and the
Canadian Collateral Agent shall, at the request, or may with the consent, of the
Requisite Lenders, by written notice to the Borrowers (a) declare that the
Commitments are terminated, whereupon the Commitments and the obligation of each
Lender to make any Loan and/or create any additional Canadian Bankers
Acceptances, the Issuing Bank to issue any Letters of Credit and Summit Bank
and/or Mellon US to purchase any Foreign Exchange Contracts hereunder shall
immediately terminate and/or (b) declare the unpaid principal amount of, and any
and all accrued and unpaid interest on, the Loans, all US Reimbursement
Obligations and all Canadian Reimbursement Obligations to be, and the same shall
thereupon be, immediately due and payable with all additional interest from time
to time accrued thereon and without presentment, demand, or protest or other
requirements of any kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to demand or accelerate
and of acceleration), all of which are hereby expressly waived by the Borrowers.
(ii) DEPOSIT FOR LETTERS OF CREDIT. Promptly upon demand by the US
Collateral Agent, the Canadian Collateral Agent or the Issuing Bank after the
occurrence and during the continuance of any Event of Default, the applicable
Borrowers shall deposit with the US Collateral Agent or the Canadian Collateral
Agent, as applicable, for the benefit of the Issuing Bank with respect to each
Letter of Credit then outstanding for the account of the Borrowers, Cash or Cash
Equivalents in an amount equal to the greatest amount for which all such Letters
of Credit may be drawn. Such deposit shall be held by the US Collateral Agent
and/or the Canadian Collateral Agent, as applicable, for the benefit of the
Issuing Bank as security for, and to provide for the payment of, the applicable
Reimbursement Obligations.
(iii) RIGHTS UNDER LOAN DOCUMENTS. Upon the occurrence and during
the continuance of any Event of Default, the Administrative Agent, the US
Collateral Agent and the Canadian Collateral Agent may, and upon the direction
of the Requisite Lenders shall, take any lawful action against the Borrowers
and/or the Corporate Guarantor to collect the payments then due and thereafter
to become due under the Loan Documents, including, without limitation, any
rights under the Collateral Documents.
(iv) SET-OFF. Upon the occurrence and during the continuance of any
Event of Default, without prior notice or other action (any such notice being
hereby expressly waived by the Borrowers; PROVIDED, HOWEVER, the Administrative
Agent, the Canadian Collateral Agent and each Lender shall give the Borrowers
notice within three (3) days after the Administrative Agent, the US Collateral
Agent, the Canadian Collateral Agent and/or any Lender has set off any such
amounts), the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and each Lender may set-off any money owed by the
Administrative Agent, the US Collateral Agent,
the Canadian Collateral Agent and/or such Lender in any capacity to the
Borrowers or the Corporate Guarantor or any Property of any of the Borrowers or
of the Corporate Guarantor in the possession of the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and/or such Lender against any
of the monetary Obligations of the Borrowers to the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and/or such Lender under the
Loan Documents, and the Administrative Agent, the US Collateral Agent, the
Canadian Collateral Agent and/or such Lender shall be deemed to have exercised
such right of set-off and to have made a charge against any such money or
property immediately, even though the actual book entries with respect thereto
may be made at some time subsequent thereto.
SECTION 9.03 APPLICATION OF PROCEEDS. (i) (a) All payments and proceeds
received by the Lenders under SECTION 9.02 of this Loan Agreement in connection
with the sale, liquidation or other disposition of (1) the US Collateral held
pursuant to the Security Agreement #1 and/or any of the other Security
Agreements (other than the Security Agreement #2, which is provided for in
SECTION 9.03(i)(b) below) and (2) the stock held pursuant to the Pledge of Stock
Agreements, shall be applied in the following order of priority:
(A) FIRST, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to the
Administrative Agent, the US Collateral Agent and/or any other Indemnified
Parties from the US Borrowers;
(B) SECOND, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to any and
all US Lenders from the US Borrowers;
(C) THIRD, to pay any and all interest due in respect of any
US Revolving Credit Loans and any US Reimbursement Obligations;
(D) FOURTH, to pay or prepay any and all principal of the US
Revolving Credit Loans and US Reimbursement Obligations and to pay (or to
the extent such Obligations are contingent, prepay or provide cash
collateral in respect of) any and all US Letter of Credit Obligations;
(E) FIFTH, to pay any and all interest due in respect of any
Acquisition/Term Loans;
(F) SIXTH, to pay or prepay any and all principal of the
Acquisition/Term Loans;
(G) SEVENTH, to the ratable payment of any and all other
non-Swap Obligations, including, without limitation, any and all
Obligations owed by the Canadian Borrower to Summit Bank and Mellon US in
connection with any Foreign Exchange Contracts and the F/X Line of Credit
Facility;
(H) EIGHTH, to pay any and all Swap Obligations;
(I) NINTH, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to the
Canadian Collateral Agent and/or any other Indemnified Parties from the
Canadian Borrower;
(J) TENTH, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to any and
all Canadian Lenders from the Canadian Borrower;
(K) ELEVENTH, to pay any and all interest due in respect of
any Canadian Revolving Credit Loans and any Canadian Reimbursement
Obligations;
(L) TWELFTH, to pay or prepay any and all principal of the
Canadian Revolving Credit Loans and Canadian Reimbursement Obligations and
to pay (or to the extent such Obligations are contingent, prepay or
provide cash collateral in respect of) any and all Canadian Letter of
Credit Obligations; and
(M) FINALLY, the balance, if any, shall be paid to the US
Borrowers, or, if otherwise determined by a court of competent
jurisdiction, to whomever may be entitled thereto;
PROVIDED, HOWEVER, that if sufficient funds are not available to fund all
payments to be made in respect of the Obligations owing by any of the Borrowers
described in any of the foregoing CLAUSES (A) THROUGH (K), the available funds
shall be allocated within the last particular clause for which such funds were
available to the payment of such Obligations ratably, based on the proportion of
the Administrative Agent's, the US Collateral Agent's, the Canadian Collateral
Agent's and each Lender's respective interest in the aggregate outstanding
Obligations described in such clause.
(b) All payments and proceeds received by the Lenders under SECTION
9.02 of this Loan Agreement in connection with the sale, liquidation or other
disposition of the Canadian Collateral held under the Security Agreement #2
shall be applied in the following order of priority:
(A) FIRST, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to the
Administrative Agent, which are directly related to the Canadian Revolving
Credit Loan Facility, the Canadian Collateral Agent and/or any other
Indemnified Parties from the Canadian Borrower;
(B) SECOND, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to any and
all Canadian Lenders
from the Canadian Borrower;
(C) THIRD, to pay any and all interest due in respect of any
Canadian Revolving Credit Loans and any Canadian Reimbursement
Obligations;
(D) FOURTH, to pay or prepay any and all principal of the
Canadian Revolving Credit Loans and Canadian Reimbursement Obligations and
to pay (or to the extent such Obligations are contingent, prepay or
provide cash collateral in respect of) any and all Canadian Letter of
Credit Obligations;
(E) FIFTH, to the ratable payment of any and all other
non-Swap Obligations, including, without limitation, any and all
Obligations owed by the Canadian Borrower to Summit Bank and Mellon US in
connection with any Foreign Exchange Contracts and the F/X Line of Credit
Facility; and
(F) FINALLY, the balance, if any, shall be paid to the
Canadian Borrower, or, if otherwise determined by a court of competent
jurisdiction, to whomever may be entitled thereto;
PROVIDED, HOWEVER, that if sufficient funds are not available to make all
payments to be made in respect of the Obligations owing by any of the Borrowers
described in any of the foregoing CLAUSES (A) THROUGH (E), the available funds
shall be allocated within the last particular clause for which such funds were
available to the payment of such Obligations ratably, based on the proportion of
the Administrative Agent's, the Canadian Collateral Agent's and each Canadian
Lender's respective interest in the aggregate outstanding Obligations described
in such clause.
(c) All payments and proceeds received by the Lender under SECTION
9.02 of this Loan Agreement from all sources other than the Collateral described
in SECTIONS 9.03(i)(a) AND (b) above shall be applied in the following order of
priority:
(A) FIRST, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to the
Agents and/or any other Indemnified Parties from the Borrowers;
(B) SECOND, to pay any and all Obligations in respect of any
fees, costs, expense reimbursements and/or indemnities then due to any and
all Lenders from the Borrowers;
(C) THIRD, to pay any and all interest due in respect of any
Revolving Credit Loans, any US Reimbursement Obligations and any Canadian
Reimbursement Obligations;
(D) FOURTH, to pay or prepay any and all principal of the
Revolving
Credit Loans, US Reimbursement Obligations and Canadian Reimbursement
Obligations and to pay (or to the extent such Obligations are contingent,
prepay or provide cash collateral in respect of) any and all US Letter of
Credit Obligations and Canadian Letter of Credit Obligations;
(D) FIFTH, to pay any and all interest due in respect of any
Acquisition/Term Loans;
(E) SIXTH, to pay or prepay any and all principal of the
Acquisition/Term Loans;
(F) SEVENTH, to the ratable payment of any and all other
non-Swap Obligations, including, without limitation, any and all
Obligations owed by the Canadian Borrower to Summit Bank and Mellon US in
connection with any Foreign Exchange Contracts and the F/X Line of Credit
Facility;
(G) EIGHTH, to pay any and all Swap Obligations; and
(H) FINALLY, the balance, if any, shall be paid to the
Borrowers, or, if otherwise determined by a court of competent
jurisdiction, to whomever may be entitled thereto;
PROVIDED, HOWEVER, that if sufficient funds are not available to fund all
payments to be made in respect of the Obligations owing by any of the Borrowers
described in any of the foregoing CLAUSES (A) THROUGH (G), the available funds
shall be allocated within the last particular clause for which such funds were
available to the payment of such Obligations ratably, based on the proportion of
the Administrative Agent's, the US Collateral Agent's, the Canadian Collateral
Agent's and each Lender's respective interest in the aggregate outstanding
Obligations described in such clause.
(ii) If the amount of the proceeds received from the sale or other
disposition of the Collateral shall be insufficient to satisfy in full the
amounts referred to (a) in SECTION 9.03(i)(a) above, then the US Borrowers shall
remain and be JOINTLY AND SEVERALLY liable for any such deficiency and (b) in
SECTION 9.03(i)(b) above, then the Canadian Borrower shall remain and be liable
for any such deficiency.
SECTION 9.04 NO NOTICES. In order to entitle the Administrative Agent, the
US Collateral Agent and/or the Canadian Collateral Agent to exercise any remedy
available to it under SECTION 9.02 of this Loan Agreement, it shall not be
necessary for the Administrative Agent, the US Collateral Agent and/or the
Canadian Collateral Agent to give any notice, other than such notice as may be
required expressly in this Loan Agreement or by applicable Law.
SECTION 9.05 AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES. Upon the
occurrence
and during the continuance of an Event of Default, as a result of which the
Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and/or any Lender shall require and employ attorneys or incur other expenses for
the collection of payments due or to become due or the enforcement or
performance or observance of any obligation or agreement on the part of the
Borrowers contained herein, the Borrowers shall, on demand, pay to the
Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and/or the applicable Lender, the reasonable fees of such attorneys and such
other expenses so incurred by them, including, without limitation, any and all
POST-JUDGMENT COLLECTION COSTS AND EXPENSES.
SECTION 9.06 NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the event that
any agreement contained in this Loan Agreement should be breached by any party
and thereafter waived by the other parties, such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any other breach
hereunder.
SECTION 9.07 FAILURE TO EXERCISE RIGHTS. Nothing herein contained shall
impose upon the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and/or any of the Lenders any obligation to enforce any terms,
covenants or conditions contained in this Loan Agreement and the other Loan
Documents. Failure of the Administrative Agent, the US Collateral Agent, the
Canadian Collateral Agent and/or any of the Lenders, in any one or more
instances, to insist upon strict performance by the Borrowers or the Corporate
Guarantor of any of the terms, covenants or conditions of this Loan Agreement
and the other Loan Documents, shall not be considered or taken as a waiver or
relinquishment by the Administrative Agent, the US Collateral Agent, the
Canadian Collateral Agent and/or any of the Lenders of their respective right to
insist upon and to enforce in the future, by injunction or other appropriate
legal or equitable remedy, strict compliance by the Borrowers and the Corporate
Guarantor with all the terms, covenants and conditions of this Loan Agreement
and the other Loan Documents. The consent of the Administrative Agent, the US
Collateral Agent, the Canadian Collateral Agent and/or any of the Lenders to any
act or omission by the Borrowers and/or the Corporate Guarantor shall not be
construed to be a consent to any other or subsequent act or omission or to waive
the requirement for the Administrative Agent's, the US Collateral Agent's, the
Canadian Collateral Agent's and/or any of the Lender's consent to be obtained in
any future or other instance.
SECTION 9.08 WAIVER OF JURY TRIAL. THE BORROWERS, THE AGENTS AND THE
LENDERS MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY (i) WAIVE ANY
AND ALL RIGHTS THAT THEY MAY NOW OR HEREAFTER HAVE UNDER THE LAWS OF THE UNITED
STATES OF AMERICA OR ANY STATE THEREOF TO A TRIAL BY JURY IN RESPECT OF ANY
CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LOAN
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN
CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT LIMITATION, ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF THE AGENT AND/OR
THE LENDERS RELATING TO THE ADMINISTRATION OF THE LOAN FACILITIES OR ENFORCEMENT
OF THE LOAN DOCUMENTS, AND (ii) AGREE THAT NONE OF THE BORROWERS, THE AGENTS OR
THE LENDERS WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN
WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY
APPLICABLE LAW, THE BORROWERS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT THEY MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. THE BORROWER HEREBY CERTIFY THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF THE AGENTS AND/OR THE LENDERS HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT ANY OF THE AGENTS AND/OR ANY OF THE LENDERS WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS. THIS WAIVER
CONSTITUTES A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN FACILITIES
AVAILABLE TO THE BORROWERS AND TO ACCEPT THE LOAN DOCUMENTS. IT IS INTENDED THAT
SAID WAIVERS SHALL APPLY TO ANY AND ALL DEFENSES, RIGHTS, AND/OR COUNTERCLAIMS
IN ANY ACTION OR PROCEEDING. THE BORROWERS, THE AGENTS AND THE LENDERS RECOGNIZE
THAT ANY DISPUTE ARISING IN CONNECTION WITH THE LOAN FACILITIES IS LIKELY TO BE
COMPLEX AND CONSEQUENTLY THEY WISH TO STREAMLINE AND MINIMIZE THE COST OF THE
DISPUTE RESOLUTION PROCESS BY AGREEING TO WAIVE THEIR RIGHTS TO A JURY TRIAL.
SECTION 9.09 REMEDIES CUMULATIVE. No remedy herein conferred upon or
reserved to the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and/or any of the Lenders is intended to be exclusive of any
other remedy or remedies; but each and every such remedy shall be cumulative,
and shall be in addition to every other remedy given hereunder, or now or
hereafter existing at law or in equity or by statute. No express or implied
waiver by the Administrative Agent, the US Collateral Agent, the Canadian
Collateral Agent and/or any of the Lenders of any Event of Default hereunder
shall in any way be, or be construed to be, a waiver of any future or subsequent
Event of Default. No delay or omission to exercise any right or power accruing
upon any Event of Default continuing as aforesaid, shall impair any such right
or power or shall be construed to be a waiver of any such Event of Default, or
acquiescence therein; and every such right and power may be exercised from time
to time and as often as may be deemed expedient.
ARTICLE X
THE ADMINISTRATIVE AGENT; THE US COLLATERAL AGENT
AND THE CANADIAN COLLATERAL AGENT
SECTION 10.01 APPOINTMENT. (i) Each Lender hereby irrevocably designates
and appoints (a) Summit Bank as the Administrative Agent of such Lender, (b)
Summit Bank as the US Collateral Agent for any and all Collateral located in the
United States of America and (c) Mellon Canada as the Canadian Collateral Agent
for any and all Collateral located in Canada and as for the administration of
the Canadian Revolving Credit Loan Facility, all under this Loan Agreement and
the Loan Documents. Each Lender hereby irrevocably authorizes the Administrative
Agent, the US Collateral Agent and the Canadian Collateral Agent to take such
action on its behalf under the provisions of this Loan Agreement and the other
Loan Documents and to exercise such powers as are set forth herein or therein
together with such other powers as are incidental thereto. Each Lender hereby
irrevocably authorizes the Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent to execute and deliver each of the Loan Documents and
to accept delivery of such of the other Loan Documents as may not require
execution by the Administrative Agent, the US Collateral Agent and/or the
Canadian Collateral Agent. Each Lender hereby agrees that the rights and
remedies granted to the Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent under the Loan Documents shall be exercised
exclusively by the Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent, respectively, and that no Lender shall have any right
individually to exercise any such right or remedy, except to the extent
expressly provided herein or therein. Each of the Administrative Agent, the US
Collateral Agent and the Canadian Collateral Agent hereby agrees to act as such
on the express conditions contained in this ARTICLE X.
(ii) The provisions of this ARTICLE X are solely for the benefit of
the Administrative Agent, the US Collateral Agent, the Canadian Collateral Agent
and the Lenders, and the Borrowers shall not have any rights to rely on or
enforce any of the provisions hereof. In performing their respective functions
and duties under this Loan Agreement, the Administrative Agent, the US
Collateral Agent and the Canadian Collateral Agent shall act solely as agents of
the Lenders and do not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for the Borrowers.
SECTION 10.02 GENERAL NATURE OF THE AGENTS' DUTIES. Notwithstanding
anything to the contrary elsewhere in this Loan Agreement or in any other Loan
Document:
(i) None of the Administrative Agent, the US Collateral Agent or the
Canadian Collateral Agent shall have any duties or responsibilities except those
expressly set forth in this Loan Agreement and the other Loan Documents, and no
implied duties or responsibilities on the part of the Administrative Agent, the
US Collateral Agent or the Canadian Collateral Agent shall be read into this
Loan Agreement or any Loan Document or shall otherwise exist.
(ii) The duties and responsibilities of the Administrative Agent,
the US Collateral Agent and the Canadian Collateral Agent under this Loan
Agreement and the other Loan Documents shall be mechanical and administrative in
nature, and none of the Administrative Agent, the US Collateral Agent or the
Canadian Collateral Agent shall have a fiduciary relationship in respect of any
Lender or in respect of another Agent.
(iii) The Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent are and shall be solely the agents of the Lenders.
None of the Administrative Agent, the US Collateral Agent or the Canadian
Collateral Agent assumes, and shall at no time be deemed to have, any
relationship of agency or trust with or for, or any other duty or responsibility
to, the Borrowers and/or their Subsidiaries or any other Person (except only for
their respective relationships as agent for, and their express duties and
responsibilities to, the Lenders as provided in this Loan Agreement and the
other Loan Documents).
(iv) None of the Administrative Agent, the US Collateral Agent or
the Canadian Collateral Agent shall be under any obligation to take any action
hereunder or under any other Loan Document if any such Agent believes in good
faith that taking such action may conflict with any Law or any provision of this
Loan Agreement or any other Loan Document, or may require such Agent to qualify
to do business in any jurisdiction where it is not then so qualified.
SECTION 10.03 EXERCISE OF POWERS. The Administrative Agent, the US
Collateral Agent and/or the Canadian Collateral Agent shall take any action of
the type specified in this Loan Agreement or any other Loan Document as being
within the such Agent's respective rights, powers or discretion in accordance
with directions from the Requisite Lenders (or, to the extent this Loan
Agreement or such other Loan Document expressly requires the direction or
consent of some other Person or set of Persons, then instead in accordance with
the directions of such other Person or set of Persons). In the absence of such
directions, each of the Administrative Agent, the US Collateral Agent and the
Canadian Collateral Agent shall have the authority (but under no circumstances
shall be obligated), in its sole and absolute discretion, to take any such
action, except to the extent this Loan Agreement or such Loan Document expressly
requires the direction or consent of the Requisite Lenders (or some other Person
or set of Persons), in which such Agent shall not take such action absent such
direction or consent. Any action or inaction pursuant to such direction,
discretion or consent shall be binding on all the Lenders. None of the
Administrative Agent, the US Collateral Agent or the Canadian Collateral Agent
shall have any liability to any Person as a result of (i) such Agent acting or
refraining from acting in accordance with the directions of the Requisite
Lenders (or other applicable Person or set of Persons), (ii) such Agent
refraining from acting in the absence of instructions to act from the Requisite
Lenders (or other applicable Person or set of Persons), whether or not such
Agent has discretionary power to take such action, or (iii) such Agent taking
discretionary action it is authorized to take under this Section (subject, in
the case of this CLAUSE (iii), to the provisions of SECTION 10.04(i) hereof).
SECTION 10.04 GENERAL EXCULPATORY PROVISIONS. Notwithstanding anything to
the contrary elsewhere in this Loan Agreement or any other Loan Document:
(i) No Agent be liable for any action taken or omitted to be taken
by it under or in connection with this Loan Agreement or any other Loan
Documents, unless caused by its own gross negligence or willful misconduct.
(ii) No Agent shall be responsible for (a) the execution, delivery,
effectiveness, enforceability, genuineness, validity or adequacy of this Loan
Agreement or any other Loan Document, (b) any recital, representation, warranty,
document, certificate, report or statement in, provided for in, or received
under or in connection with, this Loan Agreement or any other Loan Document, (c)
any failure of the Borrowers or their Subsidiaries or any Lender to perform any
of their respective obligations under this Loan Agreement or any other Loan
Document, (d) the existence, validity, enforceability, perfection, recordation,
priority, adequacy or value, now or hereafter, of any Lien or other direct or
indirect security afforded or purported to be afforded by any of the Loan
Documents or otherwise from time to time or (e) caring for, protecting,
insuring, or paying any taxes, charges or assessments with respect to any
Collateral.
(iii) No Agent shall be under any obligation to ascertain, inquire
or give any notice relating to (a) the performance or observance of any of the
terms or conditions of this Loan Agreement or any other Loan Document on the
part of the Borrowers or their Subsidiaries, (b) the business, operations,
condition (financial or otherwise) or prospects of the Borrowers or their
Subsidiaries or (c) except to the extent set forth in SECTION 10.05(vi) below,
the existence of any Event of Default or any Potential Event of Default.
(iv) No Agent shall be under any obligation, either initially or on
a continuing basis, to provide any Lender with any notices, reports or
information of any nature, whether in its possession presently or hereafter,
except for such notices, reports and other information expressly required by
this Loan Agreement or any other Loan Document to be furnished by such Agent to
such Lender, of which such Agent has actual receipt or possession.
SECTION 10.05 ADMINISTRATION BY THE AGENTS.
(i) Each of the Agents may rely upon any notice or other
communication of any nature (written or oral, including but not limited to
telephone conversations, whether or not such notice or other communication is
made in a manner permitted or required by this Loan Agreement or any Loan
Document) purportedly made by or on behalf of the proper party or parties, and
no Agent shall have any duty to verify the identity or authority of any Person
giving such notice or other communication.
(ii) Each Agent may consult with legal counsel (including, without
limitation, in-house counsel for such Agent or in-house or other counsel for any
Lender), independent
certified public accountants and any other experts selected by it from time to
time, and no Agent shall be liable for any action taken or omitted to be taken
in good faith by it in accordance with the advice of such counsel, accountants
or experts.
(iii) Each Agent may conclusively rely upon the truth of the
statements and the correctness of the opinions expressed in any certificates or
opinions furnished to the such Agent in accordance with the requirements of this
Loan Agreement or any other Loan Document. Whenever any Agent shall deem it
necessary or desirable that a matter be proved or established with respect to
the Borrowers, the Corporate Guarantor or any Lender, such matter may be
established by a certificate of the Borrowers, such Corporate Guarantor or any
Lender, as the case may be, and each Agent may conclusively rely upon such
certificate (unless other evidence with respect to such matter is specifically
prescribed in this Loan Agreement or another Loan Document).
(iv) Each Agent may fail or refuse to take any action unless it
shall be indemnified to its satisfaction from time to time against any and all
amounts, liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature which
may be imposed on, incurred by or asserted against such Agent by reason of
taking or continuing to take any such action.
(v) Each Agent may perform any of its respective duties under this
Loan Agreement or any other Loan Document by or through agents or
attorneys-in-fact. No Agent shall be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
(vi) No Agent shall be deemed to have any knowledge or notice of the
occurrence of any Event of Default or Potential Event of Default unless such
Agent has received notice from a Lender or the Borrowers referring to this Loan
Agreement, describing such Event of Default or Potential Event of Default, and
stating that such notice is a "notice of default". If any Agent receives such a
notice, such Agent shall give prompt notice thereof to each Lender and to each
other Agent.
SECTION 10.06 EACH LENDER NOT RELYING ON ANY AGENT OR ANY OTHER LENDER.
Each Lender hereby acknowledges as follows: (i) none of the Administrative
Agent, the US Collateral Agent, the Canadian Collateral Agent or any other
Lender has made any representation or warranties to it, and no act taken or
hereafter by any Agent or any other Lender shall be deemed to constitute any
representation or warranty by such Agent or such other Lender to it; (ii) it
has, independently and without reliance upon any Agent or any other Lender, and
based upon such documents and information as it has deemed appropriate, made its
own credit and legal analysis and decision to enter into this Loan Agreement and
the other Loan Documents; and (iii) it will, independently and without reliance
upon any Agent or any other Lender, and based upon such documents and
information as it shall deem appropriate at the time, make its own decisions to
take or not take action under or in connection with this Loan Agreement and the
other Loan
Documents.
SECTION 10.07 INDEMNIFICATION. Each Lender hereby agrees to reimburse and
indemnify the Agents and their respective directors, officers, employees,
attorneys and agents (to the extent not reimbursed by the Borrowers and without
limitation of the obligations of the Borrowers to do so), for such Lender's Pro
Rata Share (based on the respective Commitments), from and against any and all
amounts, losses, liabilities, claims, damages, expenses, obligations, penalties,
actions, judgments, suits, costs or disbursements of any kind or nature
(including, without limitation, the fees and disbursements of counsel for each
of the Agents for such other Person in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
such Agent or such other Person shall be designated a party thereto) that may at
any time be imposed on, incurred by or asserted against any of the Agents or
such other Person as a result of, or arising out of, or in any way related to or
by reason of, this Loan Agreement, any other Loan Document, any transaction from
time to time contemplated hereby or thereby, or any transaction financed in
whole or in part or directly or indirectly with the proceeds of any Loan;
PROVIDED, HOWEVER, no Lender shall be liable for any portion of such amounts,
losses, liabilities, claims, damages, expenses, obligations, penalties, actions,
judgments, suits, costs or disbursements resulting solely from the gross
negligence or willful misconduct of any Agent or such other Person. Payment
under this SECTION 10.07 shall be due and payable on demand, and to the extent
that any Lender fails to pay any such amount on demand, such amount shall bear
interest for each day from the date of demand until paid (before and after
judgment) at a rate per annum (calculated on the basis of a year of 360 days and
actual days elapsed) which for each day shall be equal to the Federal Funds
Effective Rate.
SECTION 10.08 AGENTS IN THEIR INDIVIDUAL CAPACITIES. With respect to the
Commitments of and the Obligations owing to each Agent, each Agent shall have
the same rights and powers under this Loan Agreement and each other Loan
Document as any other Lender and may exercise the same as though it were not an
Agent, and the terms "Lenders," "holders of Notes" and like terms shall include
the Agents in their individual capacities as such. The Agents and their
respective affiliates may, without liability to account, make loans to, accept
deposits from, acquire debt or equity interests in, act as trustee under
indentures of, and engage in any other business with the Borrowers as though the
Agents were not the Agents hereunder.
SECTION 10.09 HOLDERS OF NOTES. The Agents may deem and treat any Lender
which is the payee of a Note as the owner and holder of such Note for all
purposes hereof unless and until an Assignment and Acceptance with respect to
the assignment or transfer thereof shall have been filed with the Administrative
Agent in accordance with SECTION 11.02 hereof. Any authority direction or
consent of any person who at the time of giving such authority, direction or
consent is shown in the Loan Account as being a Lender shall be conclusive and
binding on each present and subsequent holder, transferee or assignee of any
Note or Notes payable to such Lender or of any Note or Notes issued in exchange
therefor.
SECTION 10.10 SUCCESSOR AGENTS. Any Agent may resign at any time by ten
(10) days prior express written notice thereof to the Lenders and the Borrowers.
Any Agent may be removed by the Requisite Lenders at any time, for cause, by
giving ten (10) days prior express
written notice thereof to such Agent, the other Agents, the other Lenders and
the Borrowers. Upon any such resignation or removal, the Requisite Lenders shall
have the right to appoint a successor such Agent. If no successor such Agent
shall have been so appointed and consented to, and shall have accepted such
appointment, within thirty (30) days after such notice of resignation or
removal, then the retiring Agent may, on behalf of the Lenders, appoint a
successor such Agent. Each successor Agent shall be a commercial bank or trust
company organized under the laws of the United States of America, or any State
thereof, or Canada, or any Province thereof, and having a combined capital and
surplus of at least US$2,000,000,000.00 and is otherwise in compliance with all
then applicable laws or regulations regarding regulatory capital requirements
after giving effect to any "phase-in" provisions thereof; PROVIDED, HOWEVER,
that with respect to a successor for the (i) US Collateral Agent, such successor
Agent shall be required to be organized under the laws of the United States of
America, or any State thereof, and (ii) Canadian Collateral Agent, such
successor Agent shall be required to be organized under the laws of Canada, or
any Province thereof. Upon the acceptance by a successor Agent of its
appointment as such Agent hereunder, such successor Agent shall thereupon
succeed to and become vested with all the properties, rights, powers, privileges
and duties of the former such Agent, without further act, deed or conveyance.
Upon the effective date of resignation or removal of a retiring Agent, such
Agent shall be discharged from its respective duties under this Loan Agreement
and the other Loan Documents, but the provisions of this Loan Agreement shall
inure to its benefit as to any actions taken or omitted by it while it was an
Agent under this Loan Agreement. If and so long as no successor Agent shall have
been appointed, then any notice or other communication required or permitted to
be given by such Agent shall be sufficiently given if given by the Requisite
Lenders, all notices or other communications required or permitted to be given
to such Agent shall be given to each Lender and to each other Agent, and all
payments to be made to such Agent shall be made directly to the Borrowers, the
Agent or Lender for whose account such payment is made.
SECTION 10.11 ADDITIONAL AGENTS. If any Agent shall from time to time deem
it necessary or advisable, for its own protection in the performance of its
duties hereunder or in the interest of the Lenders, then such Agent, the other
Agents and the Borrowers shall execute and deliver a supplemental agreement and
all other instruments and agreements necessary or advisable, in the opinion of
the Administrative Agent, to constitute another commercial bank or trust
company, or one or more other Persons approved by the Administrative Agent, to
act as co-Agent or agent with respect to any part of the Collateral with such
powers of such Agent as may be provided in such supplemental agreement, and to
vest in such bank, trust company or Person as such co-Agent or separate agent,
as the case may be, any properties, rights, powers, privileges and duties of
such Agent under this Loan Agreement or any other Loan Document.
SECTION 10.12 CALCULATIONS. No Agent shall be liable for any calculation,
apportionment or distribution of payments made by it in good faith. If such
calculation, apportionment or distribution is subsequently determined to have
been made in error, the sole recourse of any Lender to whom payment was due but
not made shall be to recover from the other Lenders any payment in excess of the
amount to which they are determined to be entitled or, if the amount
due was not paid by the Borrowers, to recover such amount from the Borrowers.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 CONCERNING THE COLLATERAL AND THE COLLATERAL DOCUMENTS. Each
Lender hereby authorizes and directs the US Collateral Agent and the Canadian
Collateral Agent, respectively, for the benefit of the applicable Lenders, to
enter into the Collateral Documents. Each Lender hereby agrees that any action
taken by such Agents or the Requisite Lenders in accordance with the provisions
of this Loan Agreement or the Collateral Documents, and the exercise by such
Agents or the Requisite Lenders of the powers set forth herein or therein,
together with such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders.
SECTION 11.02 ASSIGNMENTS AND PARTICIPATIONS.
(i) Each Lender (including, without limitation, each Canadian Lender) may
assign to any bank or financial institution, all or a portion of its rights and
obligations under this Loan Agreement (including, without limitation, all or a
portion of its Revolving Credit Commitments, its Acquisition/Term Loan
Commitments, its Pro Rata Share of the Acquisition/Term Loan Facility and its
Pro Rata Share of the Revolving Credit Loan Facility owing to it) subject to the
following conditions: (a) each such assignment may be, but is not required to
be, of a constant, and not a varying, percentage of the assigning Lender's
rights and obligations under this Loan Agreement and the assignments may cover
different percentages of such Lender's US Revolving Credit Commitment, Canadian
Revolving Credit Commitment, Acquisition/Term Loan Commitment, US Letter of
Credit Obligations, Canadian Letter of Credit Obligations, Acquisition/Term
Loans and Revolving Credit Loans; (b) the aggregate amount of the Commitments of
the assigning Lender being assigned pursuant to each such assignment (determined
as of the date of the Assignment and Acceptance Agreement with respect to such
assignment) shall not cause or otherwise result in said assigning Lender's
remaining unassigned aggregate amount of Commitments, US Letter of Credit
Obligations, Canadian Letter of Credit Obligations, Acquisition/Term Loans and
Revolving Credit Loans to be less than US$2,500,000.00 (except the
Administrative Agent, in its capacity as a Lender, shall always retain and hold
at least as much of the aggregate amount of the US Revolving Credit Loan
Facility and the Acquisition/Term Loan Facility as that held by the Lender then
holding the highest aggregate amount of said Loan Facilities); (c) each such
assignment shall be to an Eligible Assignee; (d) the Eligible Assignee shall
execute and deliver to the Administrative Agent, or, with respect to the
assignment of any Canadian Lender's Canadian Revolving Credit Commitment, the
Canadian Collateral Agent, for its approval, acceptance and recording in a
register maintained by the Administrative Agent, an Assignment and Acceptance
Agreement, together with a processing and recordation fee of Three Thousand Five
Hundred and 00/100 (US$3,500.00) Dollars unless waived by the Administrative
Agent; PROVIDED, HOWEVER, that such fee shall be waived automatically for
transfers in the event that the Eligible Assignee is an affiliate of the
assigning Lender; (e) the principal amount of any assigned (1) US Revolving
Credit Commitments, Canadian Revolving Credit Commitment(s), US Letter of Credit
Obligations, Canadian Letter of Credit Obligations and Revolving Credit Loans
and/or (2) Acquisition/Term Loan Commitments and Acquisition/Term Loans shall be
not less than US$1,000,000.00 or any integral multiple of US$500,000.00 in
excess thereof; (f) the Administrative Agent has provided its prior express
written consent to such assignment, which consent shall not be unreasonably
withheld and which consent shall be indicated by its execution of said
Assignment and Acceptance Agreement; and (g) a Canadian Lender may not assign
all or any portion of its Canadian Revolving Credit Commitment (hereinafter
referred to as its "Canadian Revolving Credit Exposure") to an Eligible Assignee
that is a non-resident of Canada for purposes of the Income Tax Act of Canada
(with respect to which payments to such non-resident of principal, interest,
fees and other amounts by the Canadian Borrower would be subject to Canadian
withholding tax) at a rate higher than that then applicable to the assignor.
Upon such execution, delivery, approval, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance Agreement,
(1) the Eligible Assignee thereunder shall be a party to this Loan Agreement
and, to the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment and Acceptance Agreement, have the rights and
obligations of a Lender hereunder and (2) the Lender assignor thereunder shall
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance Agreement, relinquish its rights and
be released from its obligations under this Loan Agreement.
(ii) By executing and delivering an Assignment and Acceptance
Agreement, the assignor Lender thereunder and the Eligible Assignee thereunder
confirm to and agree with each other and the other parties hereto as follows:
(a) other than as provided in such Assignment and Acceptance Agreement, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Loan Agreement or any other Loan Document or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Loan Agreement or any other Loan Document or any other instrument
or document furnished pursuant hereto; (b) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrowers or their Subsidiaries or the performance or
observance by the Borrowers or their Subsidiaries of any of their obligations
under any Loan Document or any other instrument or document furnished pursuant
hereto; (c) such Eligible Assignee confirms that it has received all Loan
Documents and other documents and information as such Eligible Assignee has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance Agreement; (d) such Eligible Assignee will,
independently and without reliance upon any Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Loan Agreement; (e) such Eligible Assignee confirms
that it is an Eligible Assignee; (f) such Eligible Assignee appoints and
authorizes each of the Agents to take such action as agent on its behalf and to
exercise such powers under this Loan Agreement and the other Loan Documents as
are delegated to such Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto;
and (g) such Eligible Assignee agrees that it will perform in accordance with
its terms all of the obligations which by the terms of this Loan Agreement are
required to be performed by it as a Lender.
(iii) The Administrative Agent shall maintain at its address
referred to on the signature pages hereof a copy of each Assignment and
Acceptance Agreement delivered to and accepted by it and shall record in the
Loan Account the names and addresses of each Lender and the Commitment of, and
principal amount of the Loans owing to, such Lender from time to time. The
Borrowers and their Subsidiaries, the Agents and the Lenders may treat each
Person whose name is recorded in the Loan Account as a Lender hereunder for all
purposes of this Loan Agreement.
(iv) Upon its receipt of an Assignment and Acceptance Agreement
executed by an assigning Lender and an Eligible Assignee representing that it is
an Eligible Assignee, the Administrative Agent shall, if such Assignment and
Acceptance Agreement has been properly completed and is in substantially the
form of EXHIBIT "B" attached hereto, (a) accept such Assignment and Acceptance
Agreement, (b) record the information contained therein in the Loan Account and
(c) give prompt notice thereof to the Borrowers and to the other Agents.
(v) Each Lender may sell to any bank or other financial institution
one or more participations, in any amounts, in and to a portion of its rights
and obligations under this Loan Agreement (including, without limitation, all or
a portion of its US Revolving Credit Commitment, Acquisition/Term Loan
Commitment, Canadian Revolving Credit Commitment, Canadian Letter of Credit
Obligations, Loans and US Letter of Credit Obligations owing to it) subject to
the following conditions: (a) such Lender's obligations under this Loan
Agreement (including, without limitation, its US Revolving Credit Commitment,
Acquisition/Term Loan Commitment, Canadian Revolving Credit Commitment, Canadian
Letter of Credit Obligations, Loans and US Letter of Credit Obligations to the
Borrowers hereunder) shall remain unchanged; (b) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations;
(c) the Agents and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and obligations under
this Loan Agreement, including voting rights, and with regard to any and all
payments to be made under this Loan Agreement; and (d) the holder of any such
participation shall not (1) be entitled to voting rights or the right to approve
of any action under this Loan Agreement or otherwise, except that such selling
Lender may agree that it will not vote, without the consent of Persons holding a
majority of such Lender's rights and interests under this Loan Agreement, solely
with respect to the amendment or modification of those provisions of this Loan
Agreement for which, pursuant to SECTION 11.06 hereof, the consent of all the
Lenders would be required and (2) be permitted to contact the Borrowers without
the prior express written consent of the selling Lender and the Administrative
Agent (which consent may be rescinded by the Borrowers at any time).
The Borrowers hereby authorize the Agents and each Lender to
disclose to any
prospective participant any and all financial and other information in such
Person's possession concerning the Borrowers which have been or may have been
delivered to such Person by or on behalf of the Borrowers in connection with
this Loan Agreement or any other Loan Document or such Person's credit
evaluation of the Borrowers and their Subsidiaries; PROVIDED, HOWEVER, said
prospective participant shall use its best efforts to enter into a
confidentiality agreement with the selling Person in form and substance
satisfactory to the Administrative Agent.
(vi) Any Lender may at any time assign and pledge to any Federal
Reserve Bank (or to an affiliate of such Lender for the purpose of permitting
such affiliate to assign and pledge to any of the twelve (12) Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. ss.341),
as collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank all or any portion of its US Revolving
Credit Commitment, Acquisition/Term Loan Commitment, US Letter of Credit
Obligations and Loans. No such assignment shall release the assigning Lender
from its obligations hereunder.
(vii) In connection with the execution and delivery of each
Assignment and Acceptance Agreement as provided for in SECTION 11.02(iv) above,
the assigning Lender shall deliver to the Administrative Agent the superseded
Note or Notes and the Administrative Agent shall deliver to the Borrowers for
execution by the Borrowers, new Notes in order to reflect the appropriate
Commitments of the assigning Lender and the applicable Eligible Assignee after
giving effect to such Assignment and Acceptance Agreement. The Borrowers hereby
covenant and agree to promptly execute said new Notes and to promptly return
them to the Administrative Agent so that the Administrative Agent may deliver
said new Notes to the appropriate Lenders; PROVIDED, HOWEVER, the Administrative
Agent shall not deliver said new Notes unless and until the assigning Lender
shall have delivered the superseded Note to the Administrative Agent. The
assigning Lender hereby appoints the Administrative Agent as its
attorney-in-fact (coupled with an interest) for the sole purpose of canceling
the superseded Note and the assigning Lender hereby covenants and agrees that
the Administrative Agent shall not be liable for any action taken or omitted to
be taken by the Administrative Agent in connection therewith, unless caused by
the Administrative Agent's own gross negligence or willful misconduct. Upon the
Borrowers' request, the Administrative Agent shall stamp each superseded Note
"SUPERSEDED" and shall attach each said superseded Note to, and each said
superceded Note shall become a part of, the new Notes and the Administrative
Agent shall deliver said new Notes to the appropriate Lenders.
SECTION 11.03 EXPENSES.
(i) GENERALLY. The Borrowers hereby agree upon demand to pay or
reimburse the Agents for all of the Agents' legal costs and expenses (including,
without limitation, any internal legal costs and expenses) and all internal and
external audit, appraisal, valuation and investigation expenses and for all
other reasonable out-of-pocket costs and expenses of every type and nature
(including, without limitation, the reasonable fees, expenses and disbursements
of Reed Smith LLP and any other attorneys retained by any Agent, auditors,
accountants, appraisers, printers, insurance and environmental advisers, and
other consultants and agents) incurred by any Agent in connection with (a) the
protection of such Agent's Liens in the Collateral (including, without
limitation, any fees and expenses for title and lien searches, local counsel in
various jurisdictions, filing and recording fees and taxes, duplication costs
and corporate search fees), (b) administration of this Loan Agreement, the Loan
Documents, the Loans and the Collateral, including consultation with attorneys
in connection therewith and in connection with the amendment, waiver or consents
required or requested hereunder and (c) the protection, collection or
enforcement of any of the Obligations or the Collateral.
(ii) AFTER DEFAULT. The Borrowers hereby further agree to pay, or
reimburse the Agents and the Lenders for all reasonable out-of-pocket costs and
expenses, including, without limitation, reasonable attorneys' fees and
disbursements and POST-JUDGEMENT COLLECTION COSTS AND EXPENSES, and costs of
settlement incurred by any Agent after the occurrence of an Event of Default (a)
in enforcing any Obligation or in foreclosing against the Collateral or
exercising or enforcing any other right or remedy available by reason of such
Event of Default, (b) in connection with any refinancing or restructuring of the
credit arrangements provided under this Loan Agreement in the nature of a
"work-out" or in any insolvency or bankruptcy proceeding, (c) in commencing,
defending or intervening in any litigation or in filing a petition, complaint,
answer, motion or other pleadings in any legal proceeding relating to the
Borrowers and related to or arising out of the transactions contemplated thereby
or by any of the Loan Documents, (d) in taking any other action in or with
respect to any suit or proceeding (whether in bankruptcy or otherwise), (e) in
protecting, preserving, collecting, leasing, selling, taking possession of, or
liquidating any of the Collateral or (f) attempting to enforce or enforcing any
security interest in any of the Collateral or any other rights under the
Collateral Documents.
SECTION 11.04 INDEMNITY. The Borrowers hereby agree to defend, protect,
indemnify, and hold harmless the Indemnified Parties from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, claims, costs, expenses and disbursements of any kind or nature
whatsoever (including, without limitation, the reasonable fees and disbursements
of counsel for the Indemnified Parties in connection with any investigative,
administrative or judicial proceeding, whether or not the Indemnified Parties
shall be designated a party thereto), imposed on, incurred by or asserted
against the Indemnified Parties (whether direct, indirect or consequential and
whether based on any Federal or state Laws or other statutory regulations,
including, without limitation, securities and commercial laws and regulations,
under common law or at equitable cause, or on contract or otherwise, including
any liability and costs under Federal, state or local environmental, health or
safety laws, regulations, or common law principles, arising from or in
connection with the past, present or future environmental condition of the
Property, the presence of asbestos-containing materials at the Property, or the
Release or threatened Release of any Environmental Concern Material into the
Environment from the Property) in any manner relating to the conduct of the
business of the Borrowers and/or their Subsidiaries or the use or intended use
of the proceeds of the Loans hereunder (hereinafter collectively referred to as
the "Indemnified Matters"); PROVIDED, HOWEVER,
that the Borrowers shall not have any obligation to an Indemnified Party
hereunder with respect to (a) matters for which such Indemnified Party has been
compensated pursuant to or for which an exemption is provided in SECTION 2.09
and SECTION 2.10 hereof or any other provision of this Loan Agreement and (b)
Indemnified Matters caused by or resulting from the willful misconduct or gross
negligence of that Indemnified Party, as determined by a court of competent
jurisdiction. To the extent that the undertaking to indemnify, pay and hold
harmless set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, the Borrowers shall contribute the
maximum portion which it is permitted to pay and satisfy under applicable law,
to the payment and satisfaction of all Indemnified Matters incurred by the
Indemnified Parties. Anything herein to the contrary notwithstanding, to the
extent that both the Lenders and the Borrowers have indemnification obligations
with respect to any matter, the indemnification obligations of the Borrowers
shall be primary and the indemnification obligations of the Lenders shall be
secondary with respect to such matter, and if the Administrative Agent shall
recover any amount from the Borrowers with respect to Borrowers' indemnification
obligation for which the Administrative Agent has received any payment from the
Lenders, the Administrative Agent shall return to such contributing Lenders, on
a pro rata basis, any amount in excess of the amount necessary to fully
indemnify the Administrative Agent.
SECTION 11.05 RATABLE SHARING. SUBJECT TO THE TERMS, CONDITIONS AND
PROVISIONS OF ARTICLE II AND SECTION 9.03 OF THIS LOAN AGREEMENT, the Lenders
hereby agree among themselves that (i) with respect to all amounts received by
them which are applicable to the payment of the Obligations (excluding the fees
described in SECTION 2.07 hereof), equitable adjustment will be made so that, in
effect, all such amounts will be shared among them ratably in proportion to the
respective principal amounts of the Loans then outstanding to each Lender (or if
no Loans are outstanding, ratably according to the respective amount of each
Lender's US Revolving Credit Commitment to all US Revolving Credit Commitments,
each Lender's Acquisition/Term Loan Commitment to all of the Acquisition/Term
Loan Commitments and each Lender's Canadian Revolving Credit Commitment to all
Canadian Revolving Credit Commitments), whether received by voluntary payment,
by the exercise of the right of set-off or banker's lien, by counterclaim or
cross action or by the enforcement of any or all of the Obligations (excluding
the fees described in SECTION 2.07 hereof) or the Collateral and (ii) if any of
them shall by voluntary payment or by the exercise of any right of counterclaim,
set-off, banker's lien or otherwise, receive payment of a proportion of the
aggregate amount of the Obligations held by it which is greater than its ratable
share of the payments on account of Obligations (excluding the fees described in
SECTION 2.07 hereof), determined in proportion to the respective principal
amounts of the Loans then outstanding to each Lender (or if no Loans are
outstanding, ratably according to the respective amount of each Lender's US
Revolving Credit Commitment to all US Revolving Credit Commitments, each
Lender's Acquisition/Term Loan Commitment to all of the Acquisition/Term Loan
Commitments and each Lender's Canadian Revolving Credit Commitment to all
Canadian Revolving Credit Commitments), then the Lender receiving such excess
payment shall purchase, without recourse or warranty, an undivided interest and
participation (which it shall be deemed to have done simultaneously upon the
receipt
of such payment) in such Obligations owed to the other Lenders so that all such
recoveries with respect to such Obligations shall result in the remaining
principal balance of the Loans then outstanding as to each Lender being in such
amounts so as to reflect each said Lender's Pro Rata Share as determined
immediately prior to each such recovery (or if no Loans are outstanding, ratably
according to the respective amount of each Lender's US Revolving Credit
Commitment to all US Revolving Credit Commitments, each Lender's
Acquisition/Term Loan Commitment to all of the Acquisition/Term Loan Commitments
and each Lender's Canadian Revolving Credit Commitment to all Canadian Revolving
Credit Commitments, all as determined immediately prior to each such recovery);
PROVIDED, HOWEVER, that if all or part of such excess payment received by the
purchasing party is thereafter recovered from it, those purchases shall be
rescinded and the purchase prices paid for such participations shall be returned
to that party to the extent necessary to adjust for such recovery, but without
interest except to the extent the purchasing party is required to pay interest
in connection with such recovery. The Borrowers hereby agree that any Lender so
purchasing a participation from another Lender pursuant to this SECTION 11.05
may, to the fullest extent permitted by law, exercise all its rights of payment
with respect to such participation as fully as if such Lender were the direct
creditor of the Borrowers in the amount of such participation. For purposes of
this SECTION 11.05, neither the Master Agreement nor any Obligations owed by the
Borrowers to any Lender in connection with any Foreign Exchange Contracts shall
be included as part of the defined term "Obligations" in determining, as set
forth above, all amounts that shall be shared ratably by and amongst the
Lenders.
SECTION 11.06 AMENDMENTS AND WAIVERS. No amendment or modification of any
provision of this Loan Agreement shall be effective without the written
agreement of the Requisite Lenders and the Borrowers, and no termination or
waiver of any provision of this Loan Agreement, or consent to any departure by
the Borrowers therefrom, shall in any event be effective without the written
concurrence of the Requisite Lenders, which the Requisite Lenders shall have the
right to grant or withhold at their sole discretion; except that (i) with
respect to any amendment, modification or waiver of the definitions of (a) with
respect to the US Revolving Credit Facility, "Advance Limit", "Qualified US
Accounts Receivable", and/or "Qualified US Inventory", such amendment,
modification and waiver shall be effective only if evidenced by a writing signed
by or on behalf of all Lenders holding a US Revolving Credit Commitment (or if
the US Revolving Credit Commitments are not in effect but there are outstanding
US Revolving Credit Loans, then ALL US Lenders holding any portion of said US
Revolving Credit Loans), and (b) with respect to the Canadian Revolving Credit
Facility, "Advance Limit", "Qualified Canadian Accounts Receivable", and/or
"Qualified Canadian Inventory", such amendment, modification and waiver shall be
effective only if evidenced by a writing signed by or on behalf of all Lenders
holding a Canadian Revolving Credit Commitment (or if the Canadian Revolving
Credit Commitments are not in effect but there are outstanding Canadian
Revolving Credit Loans, then ALL Canadian Lenders holding any portion of said
Canadian Revolving Credit Loans) (ii) with respect to the issuance of (a) a US
Letter of Credit with an expiration date later than thirty (30) days prior to
the US Revolving Credit Termination Date, OTHER than in accordance with the
terms, conditions and provisions of SECTION 2.01(vi)(d)(4)(a) OR (b) of this
Loan
Agreement, such US Letter of Credit shall be issued only if approved by a
writing signed by or on behalf of all US Lenders holding a US Revolving Credit
Commitment (or if the US Revolving Credit Commitments are not in effect but
there are outstanding US Revolving Credit Loans, then ALL US Lenders holding any
portion of said US Revolving Credit Loans) and (b) a Canadian Letter of Credit
with an expiration date later than thirty (30) days prior to the Canadian
Revolving Credit Termination Date, OTHER than in accordance with the terms,
conditions and provisions of SECTION 2.02(vi)(d)(4)(a) OR (b) of this Loan
Agreement, such Canadian Letter of Credit shall be issued only if approved by a
writing signed by or on behalf of all Canadian Lenders holding a Canadian
Revolving Credit Commitment (or if the Canadian Revolving Credit Commitments are
not in effect but there are outstanding Canadian Revolving Credit Loans, then
ALL Canadian Lenders holding any portion of said Canadian Revolving Credit
Loans) and (iii) any amendment, modification or waiver of any of the following
provisions shall be effective only if evidenced by a writing signed by or on
behalf of ALL Lenders holding any Commitments (or if the Commitments are not in
effect but there are Obligations outstanding, then ALL Lenders holding any
portion of said Obligations):
(a) Increase the US Revolving Credit Commitment or the Canadian
Revolving Credit Commitment of any Lender over the amount thereof then in
effect, or extend the US Revolving Credit Termination Date, the Canadian
Revolving Credit Termination Date or any maturity date;
(b) Increase the Acquisition/Term Loan Commitment of any Lender over
the amount thereof then in effect, or extend the Acquisition/Term Loan Maturity
Date or the Acquisition/Term Loan Termination Date;
(c) Reduce the principal amount of or extend the time for any
scheduled payment of principal of any of the Loans, US Reimbursement Obligations
or Canadian Reimbursement Obligations, or reduce the rate of interest or extend
the time for payment of interest borne by any of the Loans, US Reimbursement
Obligations or Canadian Reimbursement Obligations or extend the time for payment
or reduce the payment of any fees, or reduce or postpone the payment of any
other expenses, indemnities or amounts payable under any of the Loan Documents;
(d) Change the definition of "Requisite Lenders" or amend this
SECTION 11.06;
(e) Release any Collateral or any guarantees of the Loan Facilities;
(f) Change the definition of "Pro Rata Share";
(g) Change any of the financial covenants set forth in ARTICLE VIII
of this Loan Agreement; and
(h) Change the definition of "Permitted Acquisitions" or amend
SECTION 7.03 and/or SECTION 7.05 of this Loan Agreement.
No amendment, modification, termination, or waiver of any provision of ARTICLE X
hereof or any other provision referring to any of the Agents shall be effective
without the prior express written consent of the Agent(s) affected by such
amendment, modification, termination or waiver. The Administrative Agent may,
but shall have no obligation to, with the concurrence of any Lender, execute
amendments, modifications, waivers or consents on behalf of such Lender. Any
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given. No notice to or demand on the Borrowers
in any case shall entitle the Borrowers to any other or further notice or demand
in similar or other circumstances. Any amendment, modification, termination,
waiver or consent effected in accordance with this SECTION 11.06 shall be
binding on each assignee, transferee or recipient of a Lender's Revolving Credit
Commitment or Loans at the time outstanding, each future assignee, transferee or
recipient of a Lender's US Revolving Credit Commitment, Canadian Revolving
Credit Commitment, Acquisition/Term Loan Commitment, US Letter of Credit
Obligations, Canadian Letter of Credit Obligations or Loans and, if signed by
the Borrowers, on the Borrowers. In the event that any Agent requests the
consent of a Lender and such Agent does not receive a written response thereto
within ten (10) Business Days after such Lender's receipt of such request, then
such Lender shall be deemed NOT to have given its consent to the requested
amendment, modification or waiver.
SECTION 11.07 INDEPENDENCE OF COVENANTS. All covenants hereunder shall be
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitation of, another covenant shall
not avoid the occurrence of an Event of Default or potential Event of Default if
such action is taken or condition exists.
SECTION 11.08 NOTICES. Unless otherwise specifically provided therein, any
notice or other communication herein required or permitted to be given shall be
in writing and may be personally served or sent by confirmed telecopy
transmission, nationally recognized overnight courier service or United States
or Canadian mail and shall be deemed to have been given when delivered in person
or by courier service, upon receipt of a confirmed telecopy transmission or four
(4) Business Days after deposit in the United States or the Canadian mail
(registered or certified, with postage prepaid and properly addressed). Notices
to any Agent pursuant to the terms, conditions and provisions of this Loan
Agreement, including, without limitation, notices pursuant to ARTICLE II of this
Loan Agreement, shall not be effective until received by such Agent. For the
purposes hereof, the addresses of the parties hereto (until notice of a change
thereof is delivered as provided in this SECTION 11.08) shall be as set forth
below each party's name on the signature pages hereof, or, as to each party, at
such other address as may be designated by such party in a written notice to all
of the other parties.
SECTION 11.09 SURVIVAL OF WARRANTIES AND AGREEMENTS. All agreements,
representations and warranties made herein shall survive the execution and
delivery of this Loan
Agreement and the other Loan Documents and the making and repayment of the Loans
hereunder.
SECTION 11.10 MARSHALLING; RECOURSE TO SECURITY; PAYMENTS SET ASIDE. The
Agents and the Lenders shall not be under any obligation to marshall any assets
in favor of the Borrowers or any other party or against or in payment of any or
all of the Obligations. Recourse to the Collateral shall not be required at any
time. To the extent that the Borrowers make a payment or payments to the
Administrative Agent or a Lender, or any of the Agents or a Lender enforces
their security interests or exercise their rights of set-off, and such payment
or payments or the proceeds of such enforcement or set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable cause,
then to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied, and all Liens, rights and remedies therefor, shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or set-off had not occurred.
SECTION 11.11 SEVERABILITY. In case any provision in or obligation under
this Loan Agreement or the other Loan Documents shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
SECTION 11.12 GOVERNING LAW. This Loan Agreement shall be governed by, and
shall be construed and enforced in accordance with, the laws of the State of New
Jersey.
SECTION 11.13 SUCCESSORS AND ASSIGNS. This Loan Agreement and the other
Loan Documents shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and permitted assigns of the Lenders. The terms and provisions of
this Loan Agreement shall inure to the benefit of any assignee or transferee of
the Loans and Commitments of any Lender, and in the event of such transfer or
assignment, the rights and privileges herein conferred upon Lenders shall
automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions hereof. The Borrowers' duties and
Obligations hereunder, may not be assigned without the prior express written
consent of the Requisite Lenders.
SECTION 11.14 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST THE BORROWERS AND/OR THEIR SUBSIDIARIES WITH RESPECT
TO THIS LOAN AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION IN THE CITY OF HACKENSACK, NEW JERSEY,
AND BY EXECUTION AND DELIVERY OF THIS LOAN AGREEMENT, THE BORROWERS ACCEPT, FOR
THEMSELVES AND IN CONNECTION WITH THEIR
PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS, AND IRREVOCABLY AGREE TO BE BOUND BY ANY FINAL JUDGMENT
RENDERED THEREBY IN CONNECTION WITH THIS LOAN AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS FROM WHICH NO APPEAL HAS BEEN TAKEN OR IS AVAILABLE. THE BORROWERS
IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THEIR NOTICE ADDRESSES
SPECIFIED ON THE SIGNATURE PAGES HEREOF, SUCH SERVICE TO BECOME EFFECTIVE TEN
(10) DAYS AFTER SUCH MAILING. THE BORROWERS, THEIR SUBSIDIARIES, THE AGENTS AND
THE LENDERS HEREBY IRREVOCABLY WAIVE ANY OBJECTION (INCLUDING WITHOUT
LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS) WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS LOAN AGREEMENT OR ANY OTHER
LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING HEREIN SHALL AFFECT
THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT
THE RIGHT OF ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWERS IN THE COURTS
OF ANY OTHER JURISDICTION.
SECTION 11.15 COUNTERPARTS; EFFECTIVENESS; INCONSISTENCIES. This Loan
Agreement and any amendments, waivers, consents, or supplements may be executed
in counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. This Loan Agreement and each of the other Loan Documents shall
be construed to the extent reasonable to be consistent one with the other, but
to the extent that the terms and conditions of this Loan Agreement are actually
inconsistent with the terms and conditions of any other Loan Documents, this
Loan Agreement shall govern.
SECTION 11.16 CONSTRUCTION The parties hereby acknowledge that each party
and its counsel have reviewed and revised this Loan Agreement and that the
normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation
of this Loan Agreement or any amendments or exhibits hereto.
SECTION 11.17 ENTIRE AGREEMENT / INTEGRATION CLAUSE. This Loan Agreement,
taken together with all of the other Loan Documents and all certificates and
other documents delivered by the Borrowers or any other Person to the Agents
and/or the Lenders in connection with the Loan Facilities, is intended by the
parties as the final, complete and exclusive statement of the transactions
evidenced by this Loan Agreement and the other Loan Documents. All prior or
contemporaneous promises, agreements and understandings, whether oral or
written, are deemed to be superseded by this Loan Agreement and the other Loan
Documents, and no party is relying
on any promise, agreement or understanding not set forth in this Loan Agreement
or in the other Loan Documents.
SECTION 11.18 PROCESS AGENT. The Canadian Borrower hereby irrevocably
appoints Cantel Medical Corp., with an address on the date hereof at 150 Clove
Road, 9th Floor, Overlook at Great Notch, Little Falls, New Jersey 07424
(hereinafter referred to as the "Process Agent"), as process agent in its name,
place and stead to receive and forward service of any and all writs, summonses
and other legal process in any suit, action or proceeding brought in the State
of New Jersey, agrees that such service in any such suit, action or proceeding
may be made upon the Process Agent and agrees to take all such action as may be
necessary to continue said appointment in full force and effect or to appoint
another agent so that such Canadian Borrower will at all times have an agent for
service of process for the above purposes.
SECTION 11.19 JUDGMENT CURRENCY. Payments in connection with any of the
Loan Facilities shall be made by the Borrowers in the same currency as the
particular Obligation for which such payments are being made. Notwithstanding
the foregoing, the payment obligation of the Canadian Borrower for any other
payments which are required by the terms, conditions and provisions of this Loan
Agreement to be made to the Canadian Collateral Agent, whether for the benefit
of the Canadian Lenders or for the benefit of the Canadian Collateral Agent,
shall not be discharged by any amount paid in another currency (other than US
Dollars) or in another place, whether pursuant to a judgment or otherwise, to
the extent the amount so paid on prompt conversion to US Dollars and transferred
to the Canadian Collateral Agent, under normal banking procedures does not yield
the amount of US Dollars in the Canadian Collateral Agent's office which is due
hereunder. In the event that any such payment by or on behalf of the Canadian
Borrower, whether pursuant to a judgment or otherwise, upon conversion and
transfer does not result in payment of such amount of US Dollars to the Canadian
Collateral Agent at the Canadian Collateral Agent's Office, the Canadian
Collateral Agent shall have a separate cause of action against the Canadian
Borrower for the additional amount necessary to yield the amount due and owing
to the Canadian Collateral Agent and/or the Canadian Lenders hereunder.
SECTION 11.20 CREDIT SUPPORT DOCUMENT. This Loan Agreement is intended to
act (i) as a "Credit Support Document" (as such term is defined in the Master
Agreement), with respect to the Borrowers and is hereby made a part of the
"Schedule" (as such term is defined in the Master Agreement) of the Master
Agreement, which Master Agreement includes the Schedules thereto and all
"Confirmations" (as such term is defined in the Master Agreement) exchanged
between the parties confirming transactions thereunder, and (ii) as a "transfer"
under a swap agreement made by or to a swap participant, in connection with a
swap agreement, within the meaning of Section 546(g) of the Bankruptcy Code.
SECTION 11.21 INTEREST SAVINGS CLAUSE. Nothing contained in this Loan
Agreement or in any of the other Loan Documents shall be construed to permit any
of the Agents or the Lenders to receive at any time interest, fees or other
charges in excess of the amounts which each Lender is legally entitled to charge
and receive under any Law to which such interest, fees or charges are
subject. In no contingency or event whatsoever shall the compensation payable to
any Agent or Lender by any of the Borrowers howsoever characterized or computed,
whether under this Loan Agreement or under any other Loan Document, exceed the
highest rate permissible under any Law to which such compensation is subject.
There is no intention that the Lenders shall contract for, charge or receive
compensation in excess of the highest lawful rate, and, in the event it should
be determined that any excess has been charged or received, then, IPSO FACTO,
such rate shall be reduced to the highest lawful rate so that no amounts shall
be charged which are in excess thereof, and the Lenders, or the Agents on their
behalf, shall apply such excess against the Obligations of the relevant Borrower
to the relevant Lender then outstanding and, to the extent of any amounts
remaining thereafter, refund such excess to the relevant Borrower.
SECTION 11.22 REPLACEMENT OF LOST PROMISSORY NOTES OR COLLATERAL
DOCUMENTS. Upon receipt of a sworn affidavit of an authorized officer of any
Lender as to the loss, theft, destruction or mutilation of any of the Notes
and/or the Collateral Documents which is not of public record, and, in the case
of such loss, theft, destruction or mutilation, upon cancellation of such
Note(s) or Collateral Documents, the applicable Borrower or Borrowers shall
issue for the benefit of said Lender, in lieu thereof, a replacement Note and/or
Collateral Document in the same principal amount thereof and otherwise of like
tenor.
SECTION 11.23 YEARLY RATE STATEMENTS. For the purposes of complying with
the Interest Act (Canada) to the extent (if any) applicable, it is expressly
agreed that:
(i) where interest or fees are calculated pursuant hereto at a rate
based on a 365 day period, the yearly rate or percentage of interest to which
such rate is equivalent is such rate multiplied by the actual number of days in
the year (365 or 366, as the case may be) divided by 365;
(ii) where interest or fees are calculated pursuant hereto at a rate
based on a 360 day period, the yearly rate or percentage of interest to which
such rate is equivalent is such rate multiplied by the actual number of days in
the year (365 or 366, as the case may be) divided by 360; and
(iii) the rates of interest specified in this Loan Agreement are
nominal rates and not effective rates or yields and the parties hereto
acknowledge that there is a material distinction between the nominal and
effective rates of interest, that they are capable of making the calculations
necessary to compare such rates and that the principle of deemed reinvestment of
interest shall not apply to any calculations of interest hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement to
be executed and delivered by their proper and duly authorized corporate
officers, and each of the Borrowers has caused its corporate seal to be hereunto
affixed and attested pursuant to the resolution of its Board of Directors, all
as of the day and year first hereinabove written.
[SEAL] CANTEL MEDICAL CORP.,
ATTEST: a Delaware corporation, as a Borrower
/s/ Craig A. Sheldon By: /s/ James P. Reilly
- ---------------------------- -----------------------------------
Name: Craig A. Sheldon Name: James P. Reilly
Title: Vice President Title: President
NOTICE ADDRESS:
150 Clove Road
9th Floor
Overlook at Great Notch,
Little Falls, New Jersey 07424
Attn.: Mr. Craig A. Sheldon
Vice President and Controller
Telecopy No.: (973) 890-7270
WITH A COPY TO:
Dornbush Mensch Mandelstam & Schaffer, LLP
747 Third Avenue
New York, New York 10017
Attn.: Eric W. Nodiff, Esq.
Telecopy No.: (212) 753-7673
[SEAL] MEDIVATORS, INC.,
ATTEST: a Minnesota corporation, as a Borrower
/s/ James P. Reilly By: /s/ Craig A. Sheldon
- ---------------------------- -----------------------------------
Name: James P. Reilly Name: Craig A. Sheldon
Title: Title: Vice President
NOTICE ADDRESS:
150 Clove Road
9th Floor
Overlook at Great Notch,
Little Falls, New Jersey 07424
Attn.: Mr. Craig A. Sheldon
Vice President and Treasurer
Telecopy No.: (973) 890-7270
WITH A COPY TO:
Dornbush Mensch Mandelstam & Schaffer, LLP
747 Third Avenue
New York, New York 10017
Attn.: Eric W. Nodiff, Esq.
Telecopy No.: (212) 753-7673
[SEAL] CARSEN GROUP INC.,
ATTEST: an Ontario company, as a Borrower
By: /s/ William Vella
- -------------------------- ----------------------------------
Name: Name: William Vella
Title: Title: President
NOTICE ADDRESS:
151 Telson Road
Markham, Ontario L3R 1E7
Attn.: Mr. William Vella
President
Telecopy No.: (905) 479-2595
WITH A COPY TO:
150 Clove Road
9th Floor
Overlook at Great Notch,
Little Falls, New Jersey 07424
Attn.: Mr. Craig A. Sheldon
Vice President and Controller
Telecopy No.: (973) 890-7270
WITH A COPY TO:
Dornbush Mensch Mandelstam & Schaffer, LLP
747 Third Avenue
New York, New York 10017
Attn.: Eric W. Nodiff, Esq.
Telecopy No.: (212) 753-7673
MELLON BANK, N.A.,
as a Lender
By: /s/ Russ J. Lopinto
-------------------------------
Russ J. Lopinto
Vice President
NOTICE ADDRESS:
Mellon Bank, N.A.
379 Thornall Street
6th Floor
Edison, New Jersey 08837
Attn.: Mr. Russ J. Lopinto
Vice President
Telecopy No.: (732) 452-3991
WITH A COPY TO:
Drinker Biddle & Shanley LLP
500 Campus Drive
Florham Park, New Jersey 07932
Attn.: Peter P. Ackourey, Esq.
Telecopy No.: (973) 360-9831
(1) Commitment Percentage of
US Revolving Credit Loan Facility: 0%
(2) Pro Rata Share of US Revolving Credit
Commitments: US$0.00
(3) Commitment Percentage of Canadian
Revolving Credit Loan Facility: 0%
(4) Pro Rata Share of Canadian Revolving
Credit Commitments: US$0.00
(5) Commitment Percentage of
Acquisition/Term Loan Facility: 40%
(6) Pro Rata Share of Acquisition/Term
Loan Commitments: US$5,000,000.00
SUMMIT BANK, as a Lender
By: /s/ Steven P. DeLuise
-------------------------------
Steven P. DeLuise
Vice President
NOTICE ADDRESS:
Summit Bank
250 Moore Street, 2nd Floor
Hackensack, New Jersey 07601
Attn.: Mr. Steven P. DeLuise
Vice President
Telecopy No.: (201) 488-6185
WITH A COPY TO:
Reed Smith LLP
P.O. Box 7839
Princeton, New Jersey 08543-7839
Attn.: Daniel F. Peck, Jr., Esq.
Telecopy No.: (609) 951-0824
(1) Commitment Percentage of
US Revolving Credit Loan Facility: 100%
(2) Pro Rata Share of US Revolving Credit
Commitments: US$2,500,000.00
(3) Commitment Percentage of Canadian
Revolving Credit Loan Facility: 0%
(4) Pro Rata Share of Canadian Revolving
Credit Commitments: US$0.00
(5) Commitment Percentage of
Acquisition/Term Loan Facility: 60%
(6) Pro Rata Share of Acquisition/Term
Loan Commitments: US$7,500,000.00
MELLON BANK, N.A., CANADA BRANCH,
as a Lender
By: /s/ Wendy B. H. Bocti
-----------------------------
Name: Wendy B. H. Bocti
Title: Principal Officer
NOTICE ADDRESS:
Mellon Bank, N.A., Canada Branch
Royal Trust Tower
P.O. Box 320, Suite 3200
Toronto Dominion Centre, 32nd Floor
Toronto, Ontario M5K 1K2
Attn.: Principal Officer
Telecopy No.:(416) 860-2409
WITH A COPY TO:
Drinker Biddle & Shanley LLP
500 Campus Drive
Florham Park, New Jersey 07932
Attn.: Peter P. Ackourey, Esq.
Telecopy No.: (973) 360-9831
and
Mellon Bank, N.A.
379 Thornall Street
6th Floor
Edison, New Jersey 08837
Attn.: Mr. Russ J. Lopinto
Vice President
Telecopy No.: (732) 452-3991
and
Fraser Milner Casgrain
P.O. Box 100
1 First Canadian Place
100 King Street West
Toronto, Ontario, Canada M5X 1B2
Attn.: Peter E. Murphy, Esq.
Telecopy No.: (416) 863-4592
(1) Commitment Percentage of
US Revolving Credit Loan Facility: 0%
(2) Pro Rata Share of US Revolving Credit
Commitments: US$0.00
(3) Commitment Percentage of Canadian
Revolving Credit Loan Facility: 100%
(4) Pro Rata Share of Canadian Revolving
Credit Commitments: US$5,000,000.00
(5) Commitment Percentage of
Acquisition/Term Loan Facility: 0%
(6) Pro Rata Share of Acquisition/Term
Loan Commitments: US$0.00
SUMMIT BANK, as the Administrative Agent
By: /s/ Andrea A. A. Bailey
-------------------------------
Andrea A. A. Bailey
Vice President
NOTICE ADDRESS:
Summit Bank
750 Walnut Avenue
Cranford, New Jersey 07016
Attn.: Ms. Andrea A. A. Bailey
Vice President
Telecopy No.: (908) 497-0687
WITH A COPY TO:
Reed Smith LLP
P.O. Box 7839
Princeton, New Jersey 08543-7839
Attn.: Daniel F. Peck, Jr., Esq.
Telecopy No.: (609) 951-0824
SUMMIT BANK, as the US Collateral Agent
By: /s/ Andrea A. A. Bailey
---------------------------------
Andrea A. A. Bailey
Vice President
NOTICE ADDRESS:
Summit Bank
750 Walnut Avenue
Cranford, New Jersey 07016
Attn.: Ms. Andrea A. A. Bailey
Vice President
Telecopy No.: (908) 497-0687
WITH A COPY TO:
Reed Smith LLP
P.O. Box 7839
Princeton, New Jersey 08543-7839
Attn.: Daniel F. Peck, Jr., Esq.
Telecopy No.: (609) 951-0824
MELLON BANK, N.A., CANADA BRANCH, as
the Canadian Collateral Agent
By: /s/ Wendy B. H. Bocti
------------------------------
Name: Wendy B. H. Bocti
Title: Principal Officer
NOTICE ADDRESS:
Mellon Bank, N.A., Canada Branch
Royal Trust Tower
P.O. Box 320, Suite 3200
Toronto Dominion Centre, 32nd Floor
Toronto, Ontario M5K 1K2
Attn.: Vice President and Manager,
Corporate Banking
Telecopy No.:(416) 860-2409
WITH A COPY TO:
Drinker Biddle & Shanley LLP
500 Campus Drive
Florham Park, New Jersey 07932
Attn.: Peter P. Ackourey, Esq.
Telecopy No.: (973) 360-9831
and
Mellon Bank, N.A.
379 Thornall Street
6th Floor
Edison, New Jersey 08837
Attn.: Mr. Russ J. Lopinto
Vice President
Telecopy No.: (732) 452-3991
and
Fraser Milner Casgrain
P.O. Box 100
1 First Canadian Place
100 King Street West
Toronto, Ontario, Canada M5X 1B2
Attn.: Peter E. Murphy, Esq.
Telecopy No.: (416) 863-4592