Exhibit 10.1
REVOLVING CREDIT AGREEMENT
DATED as of May 1, 2001
between
MICHAELS STORES, INC.
and
FLEET NATIONAL BANK,
as Administrative Agent
FLEET SECURITIES, INC.,
as Arranger
WELLS FARGO BANK TEXAS, NATIONAL ASSOCIATION,
as Syndication Agent
NATIONAL CITY BANK,
as Co-Documentation Agent
and
GUARANTY BANK
as Co-Documentation Agent
TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION.........................................................1
1.1. DEFINITIONS..........................................................................1
1.2. RULES OF INTERPRETATION..............................................................19
2. THE REVOLVING CREDIT FACILITY...................................................................20
2.1. COMMITMENT TO LEND SYNDICATED LOANS..................................................20
2.2. REQUESTS FOR LOANS...................................................................21
2.2.1. GENERAL...................................................................21
2.2.2. SWING LINE................................................................21
2.3. COMPETITIVE BID LOANS................................................................22
2.3.1. COMPETITIVE BID BORROWINGS................................................22
2.3.2. MAXIMUM COMPETITIVE BID LOANS; FUNDING LOSSES.............................25
2.3.3. REPAYMENT OF COMPETITIVE BID LOANS........................................26
2.4. FUNDS FOR LOANS......................................................................26
2.4.1. FUNDING PROCEDURES........................................................26
2.4.2. ADVANCES BY AGENT.........................................................27
2.5. SETTLEMENTS..........................................................................28
2.5.1. GENERAL...................................................................28
2.5.2. FAILURE TO MAKE FUNDS AVAILABLE...........................................28
2.5.3. NO EFFECT ON OTHER BANKS..................................................29
2.6. THE NOTES............................................................................29
2.6.1. SYNDICATED NOTES..........................................................29
2.6.2. COMPETITIVE BID NOTES.....................................................30
2.7. REDUCTION OF TOTAL COMMITMENT........................................................30
2.8. INTEREST ON LOANS....................................................................30
2.9. CONVERSION OPTIONS...................................................................31
2.9.1. CONVERSION TO DIFFERENT TYPE OF SYNDICATED LOAN...........................31
2.9.2. CONTINUATION OF TYPE OF SYNDICATED LOAN...................................31
2.9.3. EURODOLLAR RATE LOANS.....................................................32
3. REPAYMENT OF THE LOANS..........................................................................32
3.1. MATURITY.............................................................................33
3.2. MANDATORY REPAYMENTS OF LOANS........................................................33
3.3. OPTIONAL REPAYMENTS OF LOANS.........................................................33
4. LETTERS OF CREDIT...............................................................................34
4.1. LETTER OF CREDIT COMMITMENTS.........................................................34
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT.....................................34
4.1.2. LETTER OF CREDIT APPLICATIONS.............................................34
4.1.3. TERMS OF LETTERS OF CREDIT................................................34
4.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS........................................34
4.1.5. PARTICIPATIONS OF BANKS...................................................35
4.1.6. NOTICE TO AGENT...........................................................35
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWER.............................................35
4.3. LETTER OF CREDIT PAYMENTS............................................................36
4.4. OBLIGATIONS ABSOLUTE.................................................................37
4.5. RELIANCE BY ISSUER...................................................................37
4.6. LETTER OF CREDIT FEE.................................................................38
5. CERTAIN GENERAL PROVISIONS......................................................................38
5.1. CERTAIN FEES.........................................................................38
5.1.1. FEES PAYABLE AT CLOSING...................................................38
5.1.2. AGENT AND ARRANGER FEES...................................................38
5.2. FACILITY FEE.........................................................................38
5.3. UTILIZATION FEE......................................................................39
5.4. FUNDS FOR PAYMENTS...................................................................39
5.4.1. PAYMENTS TO AGENT.........................................................39
5.4.2. NO OFFSET, ETC............................................................39
5.5. COMPUTATIONS.........................................................................40
5.6. INABILITY TO DETERMINE EURODOLLAR RATE...............................................40
5.7. ILLEGALITY...........................................................................40
5.8. ADDITIONAL COSTS, ETC................................................................41
5.9. CAPITAL ADEQUACY.....................................................................42
5.10. CERTIFICATE..........................................................................43
5.11. INDEMNITY............................................................................43
5.12. INTEREST AFTER DEFAULT...............................................................43
5.12.1. OVERDUE AMOUNTS...........................................................44
5.12.2. AMOUNTS NOT OVERDUE.......................................................44
5.13. BANK OBLIGATION TO MITIGATE..........................................................44
5.14. REPLACEMENT OF BANK..................................................................44
6. GUARANTIES......................................................................................45
7. REPRESENTATIONS AND WARRANTIES..................................................................45
7.1. AUTHORITY............................................................................45
7.1.1. ORGANIZATION; GOOD STANDING...............................................45
7.1.2. AUTHORIZATION.............................................................46
7.1.3. ENFORCEABILITY............................................................46
7.2. GOVERNMENTAL APPROVALS...............................................................47
7.3. TITLE TO PROPERTIES; LEASES..........................................................47
7.4. FINANCIAL STATEMENTS.................................................................47
7.4.1. FISCAL YEAR...............................................................47
7.4.2. FINANCIAL STATEMENTS......................................................47
7.4.3. PROJECTIONS...............................................................47
7.5. NO MATERIAL CHANGES, ETC.............................................................48
7.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC.................................................48
7.7. LITIGATION...........................................................................48
7.8. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC.........................................49
7.9. TAX STATUS...........................................................................49
7.10. NO EVENT OF DEFAULT..................................................................49
7.11. HOLDING COMPANY AND INVESTMENT COMPANY ACTS..........................................49
7.12. EMPLOYEE BENEFIT PLANS...............................................................49
7.12.1. IN GENERAL................................................................49
7.12.2. TERMINABILITY OF WELFARE PLANS............................................50
7.12.3. GUARANTEED PENSION PLANS..................................................50
7.12.4. MULTIEMPLOYER PLANS.......................................................50
7.13. USE OF PROCEEDS......................................................................51
7.13.1. GENERAL...................................................................51
7.13.2. REGULATIONS U AND X.......................................................51
7.13.3. INELIGIBLE SECURITIES.....................................................51
7.14. ENVIRONMENTAL COMPLIANCE.............................................................51
7.15. SUBSIDIARIES, ETC....................................................................52
7.16. DISCLOSURE...........................................................................52
8. AFFIRMATIVE COVENANTS OF THE BORROWER...........................................................53
8.1. PUNCTUAL PAYMENT.....................................................................53
8.2. MAINTENANCE OF OFFICE................................................................53
8.3. RECORDS AND ACCOUNTS.................................................................53
8.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION...................................53
8.5. NOTICES..............................................................................55
8.5.1. DEFAULTS..................................................................55
8.5.2. ENVIRONMENTAL EVENTS......................................................55
8.5.3. NOTICE OF LITIGATION AND JUDGMENTS........................................55
8.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES.......................................55
8.7. INSURANCE............................................................................56
8.8. TAXES................................................................................56
8.9. INSPECTION OF PROPERTIES AND BOOKS, ETC..............................................57
8.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS...............................57
8.11. EMPLOYEE BENEFIT PLANS...............................................................57
8.12. USE OF PROCEEDS......................................................................57
8.13. ROYALTY PAYMENTS.....................................................................58
8.14. FURTHER ASSURANCES...................................................................58
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER......................................................58
9.1. RESTRICTIONS ON INDEBTEDNESS.........................................................58
9.2. RESTRICTIONS ON LIENS................................................................60
9.3. RESTRICTIONS ON INVESTMENTS..........................................................62
9.4. DISTRIBUTIONS........................................................................63
9.5. PAYMENTS AND MODIFICATIONS OF SENIOR NOTES...........................................63
9.6. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS......................................64
9.6.1. MERGERS AND ACQUISITIONS..................................................64
9.6.2. DISPOSITION OF ASSETS.....................................................65
9.7. COMPLIANCE WITH ENVIRONMENTAL LAWS...................................................65
9.8. EMPLOYEE BENEFIT PLANS...............................................................66
9.9. BUSINESS ACTIVITIES..................................................................66
9.10. TRANSACTIONS WITH AFFILIATES.........................................................66
9.11. CREATION AND MAINTENANCE OF SUBSIDIARIES.............................................67
9.12. DERIVATIVE TRANSACTIONS..............................................................67
9.13. SALES OF ACCOUNTS....................................................................67
9.14. NEGATIVE PLEDGES.....................................................................67
10. FINANCIAL COVENANTS OF THE BORROWER............................................................68
10.1. MAXIMUM ADJUSTED BALANCE SHEET LEVERAGE RATIO........................................68
10.2. MINIMUM CASH FLOW COVERAGE RATIO.....................................................68
10.3. CASH FLOW LEVERAGE RATIO.............................................................68
10.4. CAPITAL EXPENDITURES.................................................................68
11. CLOSING CONDITIONS.............................................................................69
11.1. LOAN DOCUMENTS.......................................................................69
11.2. CERTIFIED COPIES OF CHARTER AND DEBT DOCUMENTS.......................................69
11.3. CORPORATE ACTION.....................................................................69
11.4. INCUMBENCY CERTIFICATE...............................................................69
11.5. OPINION OF COUNSEL...................................................................69
11.6. PAYMENT OF FEES......................................................................69
11.7. PAYOFF LETTER........................................................................70
11.8. ABI GUARANTY.........................................................................70
12. CONDITIONS TO ALL BORROWINGS...................................................................70
12.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT............................................70
12.2. NO LEGAL IMPEDIMENT..................................................................70
12.3. GOVERNMENTAL REGULATION..............................................................70
12.4. PROCEEDINGS AND DOCUMENTS............................................................71
13. EVENTS OF DEFAULT; ACCELERATION; ETC...........................................................71
13.1. EVENTS OF DEFAULT AND ACCELERATION...................................................71
13.2. TERMINATION OF COMMITMENTS...........................................................74
13.3. REMEDIES.............................................................................74
14. SETOFF.........................................................................................75
15. THE AGENT......................................................................................75
15.1. AUTHORIZATION........................................................................75
15.2. EMPLOYEES AND AGENTS.................................................................76
15.3. NO LIABILITY.........................................................................76
15.4. NO REPRESENTATIONS...................................................................76
15.4.1. GENERAL...................................................................76
15.4.2. CLOSING DOCUMENTATION, ETC................................................77
15.5. PAYMENTS.............................................................................77
15.5.1. PAYMENTS TO AGENT.........................................................77
15.5.2. DISTRIBUTION BY AGENT.....................................................77
15.5.3. DELINQUENT BANKS..........................................................78
15.6. HOLDERS OF NOTES.....................................................................78
15.7. INDEMNITY............................................................................78
15.8. AGENT AS BANK........................................................................78
15.9. RESIGNATION..........................................................................79
15.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT.......................................79
16. EXPENSES AND INDEMNIFICATION...................................................................79
16.1. EXPENSES.............................................................................79
16.2. INDEMNIFICATION......................................................................80
16.3. SURVIVAL.............................................................................80
17. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION..................................................80
17.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY....................................80
17.2. CONFIDENTIALITY......................................................................81
17.3. PRIOR NOTIFICATION...................................................................81
17.4. OTHER................................................................................81
18. SURVIVAL OF COVENANTS, ETC.....................................................................82
19. ASSIGNMENT AND PARTICIPATION...................................................................82
19.1. CONDITIONS TO ASSIGNMENT BY BANKS....................................................82
19.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS.......................83
19.3. REGISTER.............................................................................84
19.4. NEW NOTES............................................................................84
19.5. PARTICIPATIONS.......................................................................84
19.6. DISCLOSURE...........................................................................85
19.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER.................................85
19.8. MISCELLANEOUS ASSIGNMENT PROVISIONS..................................................86
19.9. ASSIGNMENT BY BORROWER...............................................................86
20. NOTICES, ETC...................................................................................86
21. GOVERNING LAW..................................................................................87
22. HEADINGS.......................................................................................87
23. COUNTERPARTS...................................................................................87
24. ENTIRE AGREEMENT, ETC..........................................................................87
25. WAIVER OF JURY TRIAL...........................................................................88
26. CONSENTS, AMENDMENTS, WAIVERS, ETC.............................................................88
27. SEVERABILITY...................................................................................89
EXHIBITS
EXHIBIT A - Loan Request
EXHIBIT B - Competitive Bid Quote Request
EXHIBIT C - Invitation For Competitive Bid Quotes
EXHIBIT D-1 - Competitive Bid Quote
EXHIBIT D-2 - Notice of Competitive Bid Borrowing
EXHIBIT D-3 - Form of Notice of Competitive Bid Loans
EXHIBIT E-1 - Syndicated Note
EXHIBIT E-2 - Competitive Bid Note
EXHIBIT F - Form of Revolving Credit Loan Maturity Extension
Request
EXHIBIT G - Compliance Certificate
EXHIBIT H - Assignment and Acceptance
SCHEDULES
SCHEDULE 1 - Banks; Commitment Percentages
SCHEDULE 7.3 - Title to Property; Leases
SCHEDULE 7.7 - Litigation
SCHEDULE 7.14 - Environmental Compliance
SCHEDULE 7.15 - Subsidiaries, etc.
SCHEDULE 9.1 - Existing Indebtedness
SCHEDULE 9.2 - Existing Liens
REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT is made as of May 1, 2001, by and
among MICHAELS STORES, INC. (the "BORROWER"), a Delaware corporation having
its principal place of business at 8000 Bent Branch Drive, Irving, Texas
75063, and FLEET NATIONAL BANK, and the other lending institutions listed on
SCHEDULE 1 (collectively, the "BANKS") and FLEET NATIONAL BANK as
administrative agent for the Banks.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set
forth in this Section 1 or elsewhere in the provisions of this Credit
Agreement referred to below:
ABI. Aaron Brothers, Inc., a Delaware corporation and a wholly owned
Subsidiary of the Borrower.
ADJUSTMENT DATE. Each date which is the first day of the month
immediately following the month in which the Borrower's financial statements
and related Compliance Certificate are required to be delivered by the
Borrower pursuant to Section 8.4(a), Section 8.4(b) and Section 8.4(c),
respectively.
AFFILIATE. Any Person that would be considered to be an affiliate of
the Borrower under Rule 144(a) of the Rules and Regulations of the Securities
and Exchange Commission, as in effect on the date hereof, if the Borrower were
issuing securities.
AGENT'S HEAD OFFICE. The Agent's head office located at 100 Federal
Street, Boston, Massachusetts 02110, or at such other location as the Agent
may designate from time to time.
AGENT. Fleet National Bank, in its capacity of administrative agent
for the Banks.
AGENT'S SPECIAL COUNSEL. Bingham Dana LLP or such other counsel as
may be approved by the Agent.
APPLICABLE MARGIN. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "RATE
ADJUSTMENT PERIOD"), the Applicable Margin shall be the applicable margin or
rate (in each case per annum) set forth below with respect to the Fixed Charge
Coverage Ratio, as determined as of the end of and for the period of four
consecutive fiscal quarters of the Borrower ending immediately prior to the
applicable Rate Adjustment Period and pertaining to such Adjustment Date,
PROVIDED, HOWEVER, that for a period of six (6) months commencing on the
Closing Date, the Applicable Margin shall be set at no less than as set forth
opposite Level II below:
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APPLICABLE APPLICABLE STANDBY APPLICABLE
FIXED CHARGE EURODOLLAR LETTER OF CREDIT DOCUMENTARY LETTER
LEVEL COVERAGE RATIO MARGIN RATE FEE OF CREDIT FEE FACILITY FEE
- ----------------------------------------------------------------------------------------------------------
I less than or 1.15% 1.15% 0.575% 0.35%
equal to1.15 to
1.00
- ----------------------------------------------------------------------------------------------------------
II greater than 1.15 0.95% 0.95% 0.475% 0.30%
to 1.00 but less
than or equal to
1.50 to 1.00
- ----------------------------------------------------------------------------------------------------------
III greater than 1.50 0.75% 0.75% 0.375% 0.25%
to 1.00 but less
than or equal to
1.85 to 1.00
- ----------------------------------------------------------------------------------------------------------
IV greater than 1.85 0.55% 0.55% 0.25% 0.20%
to 1.00
- ----------------------------------------------------------------------------------------------------------
ARRANGER. Fleet Securities Inc., in its capacity as exclusive
syndication agent and arranger for the credit facilities provided hereunder.
ASSIGNMENT AND ACCEPTANCE. See Section 19.1.
BALANCE SHEET DATE. February 3, 2001.
BANKS. Fleet and the other lending institutions listed on SCHEDULE 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to Section 19.
BASE RATE. The higher of (i) the annual rate of interest announced
from time to time by Fleet at its head office in Boston, Massachusetts, as its
"base rate" and (ii) one-half of one percent (1/2%) above the Federal Funds
Effective Rate. For the purposes of this definition, "FEDERAL FUNDS EFFECTIVE
RATE" shall mean for any day, the rate per annum equal to the weighted average
of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York and reported in THE WALL
STREET JOURNAL or other publication of national circulation selected by the
Agent, or, if such rate is not so published and reported for any day that is a
Business Day, the average of the quotations for such day on such transactions
received by the Agent from three funds brokers of recognized standing selected
by the Agent.
BASE RATE LOANS. Syndicated Loans bearing interest calculated by
reference to the Base Rate.
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BORROWER. As defined in the preamble hereto.
BUSINESS DAY. Any day on which banking institutions in Boston,
Massachusetts and Dallas, Texas, are open for the transaction of banking
business and, in the case of Eurodollar Rate Loans, also a day which is a
Eurodollar Business Day.
CANADIAN LICENSE AGREEMENT. The License Agreement dated as of
February 1, 1998, among the Borrower, MC and 5931 Business Trust, as in effect
on the Closing Date and as amended from time to time with the consent of the
Agent, which consent shall not be unreasonably withheld.
CAPITAL ASSETS. Fixed assets, both tangible (such as, but not limited
to, land, buildings, fixtures, machinery and equipment) and intangible (such
as, but not limited to, patents, copyrights, trademarks, franchises and
goodwill); PROVIDED that Capital Assets shall not include any item customarily
charged directly to expense or depreciated over a useful life of twelve (12)
months or less in accordance with generally accepted accounting principles.
CAPITAL EXPENDITURES. Capital expenditures, as determined in
accordance with generally accepted accounting principles, reduced by proceeds
received during any relevant period from sale and leaseback transactions .
CAPITAL STOCK. As to any Person, the equity interests in such Person,
including, without limitation, the shares of each class of capital stock or
membership interest of any Person that is a corporation or limited liability
company and partnership interests (general and limited) in any Person that is
a partnership.
CAPITALIZED LEASES. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the obligations under which are
required to be capitalized on the balance sheet of the lessee or obligor in
accordance with generally accepted accounting principles.
CASH EQUIVALENTS.
(a) investments (directly or through a money market mutual
fund) in debt securities (including, without limitation, bankers'
acceptances, bearer deposit notes, loan participations, promissory
notes and medium-term notes) which have an average maturity of not more
than 365 days after the date of purchase, and
(i) for any such investment issued by a financial
institution, the issuer (A) maintains a long-term debt rating
of at least "A" (or its equivalent) according to Standard &
Poor's Ratings Group, a Division of McGraw-Hill, Inc. or a
Thompson Bankwatch rating of at least "B", and (B) has a
combined capital and surplus and undivided profits of not less
than $1,000,000 or any other
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financial institutions if the amount on deposit is fully
insured by the Federal Deposit Insurance Corporation, and
(ii) for any corporate issuer, such investment is
rated "P-2" (or its then equivalent) according to Moody's
Investors Service, Inc., "A-2" (or its then equivalent)
according to Standard & Poor's Ratings Group, a Division of
McGraw-Hill, Inc., "F-2" (or its then equivalent) according to
Fitch's Investors Service, Inc. or "D-2" (or its then
equivalent) according to Duff & Phelps, or a better rating,
or, which, if unrated, are determined by the fund to be of
comparable quality to debt securities which have such ratings,
and
(b) investments (directly or through a money market mutual
fund) in
(i) certificates of deposit, repurchase agreements,
and other interest bearing deposits or accounts with United
States commercial banks having a combined capital and surplus
of at least $100,000,000, whose debt obligations have one of
the three highest rating obtainable from Standard & Poor's
Ratings Group, a Division of McGraw-Hill, Inc. or Moody's
Investors Service, Inc., which certificates, repurchase
agreements, deposits, and accounts mature within one year from
the date of investment,
(ii) obligations issued or unconditionally guaranteed
by the United States government, or issued by any agency or
instrumentality thereof and backed by the full faith and
credit of the United States government, which obligations
mature within one year from the date of investment,
(iii) direct obligations issued by any state or
political subdivision of the United States, which mature one
year from the date of investment and have an A or higher
rating obtainable from Standard & Poor's Ratings Group, a
Division of McGraw-Hill, Inc., or a comparable rating
obtainable from Moody's Investors Service, Inc., or an
equivalent thereto, on the date of investment, and
(iv) commercial paper which has one of the highest
ratings obtainable from Standard & Poor's Ratings Group, a
Division of McGraw-Hill, Inc. or Moody's Investors Services,
Inc.
CERCLA. The Comprehensive Environmental Response, Compensation and
Liability Act of 1980.
CHANGE OF CONTROL. The occurrence of any of the following events with
respect to the Borrower:
(i) (A) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), other than one or more Permitted
Holders, is
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or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, of more than thirty
five percent (35%) of the total voting power of the Voting Stock of
the Borrower and (B) the Permitted Holders "beneficially own" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly
or indirectly, in the aggregate a lesser percentage of the total
voting power of the Voting Stock of the Borrower than such other person
and do not have the right or ability by voting power, contract or
otherwise to elect or designate for election a majority of the board
of directors of the Borrower (for the purposes of this clause, such
other person shall be deemed to beneficially own any Voting Stock of
a specified corporation held by a parent corporation, if such other
person "beneficially owns" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act), directly or indirectly, more than thirty five
percent (35%) of the voting power of the Voting Stock of such parent
corporation and the Permitted Holders "beneficially own" (as defined
in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate a lesser percentage of the voting
power of the Voting Stock of such parent corporation and do not have
the right or ability by voting power, contract or otherwise to elect
or designate for election a majority of the board of directors of such
parent corporation); or
(ii) during any period of two consecutive years, individuals
who at the beginning of such period constituted the board of directors
of the Borrower (together with any new directors whose election by such
board of directors or whose nomination for election by the shareholders
of the Borrower was approved by a vote of 66-2/3% of the directors of
the Borrower then still in office who were either directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of the board of directors of the Borrower then in office; or
(iii) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or
substantially all, the assets of the Borrower to any Person or group of
Persons (other than to any wholly owned Subsidiary of the Borrower); or
(iv) the merger or consolidation of the Borrower with or into
another corporation with the effect that either (A) immediately after
such transaction any person (as defined in clause (i) above) (other
than a Permitted Holder) shall have become the "beneficial owner" (as
defined in clause (i) above) of securities of the surviving corporation
of such merger or consolidation representing a majority of the voting
power of the Voting Stock of the surviving corporation or (B) the
securities of the Borrower that are outstanding immediately prior to
such transaction and which represent 100% of the voting power of the
Voting Stock of the Borrower are changed into or exchanged for cash,
securities or property, unless pursuant to such transaction such
securities are changed into or
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exchanged for, in addition to any other consideration, (1) securities
of the surviving corporation that represent immediately after such
transaction, at least a majority of the voting power of the Voting
Stock of the surviving corporation or (2) securities that represent
immediately after such transaction at least a majority of the voting
power of the Voting Stock of the corporation that owns, directly or
indirectly, 100% of the voting power of the Voting Stock of the
surviving corporation of that transaction.
CLOSING DATE. The first date on which the conditions set forth in
Section 11 have been satisfied and any Loans may be made or any Letter of
Credit may be issued hereunder.
CODE. The Internal Revenue Code of 1986.
COMMITMENT. With respect to each Bank, the amount set forth on
SCHEDULE 1 hereto, or as adjusted or specified in any amendment to this Credit
Agreement or in any Assignment and Acceptance, as the amount of such Bank's
commitment to make Loans to, and to participate in the issuance, extension and
renewal of Letters of Credit for the account of, the Borrower, as the same may
be in effect from time to time; or if such commitment is terminated pursuant
to the provisions hereof, zero. The Competitive Bid Loans of such Bank
outstanding at any time shall not affect such Bank's Commitment.
COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set
forth on SCHEDULE 1 hereto, or as adjusted or specified in any amendment to
this Credit Agreement or in any Assignment and Acceptance, as such Bank's
percentage of the aggregate Commitments of all of the Banks. The Competitive
Bid Loans of such Bank outstanding at any time shall not affect such Bank's
Commitment Percentage.
COMPETITIVE BID LOAN(S). A borrowing hereunder consisting of one or
more revolving credit loans made by any of the Banks whose offer to make a
revolving credit loan as part of such borrowing has been accepted by the
Borrower under the auction bidding procedure described in Section 2.3.
COMPETITIVE BID NOTE. See Section 2.6.2.
COMPETITIVE BID QUOTE. An offer by a Bank to make a Competitive Bid
Loan in accordance with Section 2.3.
COMPETITIVE BID QUOTE REQUEST. See Section 2.3.1(b).
COMPETITIVE BID RATE. See Section 2.3.1(d)(ii)(C).
CONSOLIDATED OR consolidated. With reference to any term defined
herein, shall mean that term as applied to the financial statements of the
Borrower and its Subsidiaries, consolidated in accordance with generally
accepted accounting principles.
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CONSOLIDATED EBITDA. With respect to the Borrower and its
Subsidiaries on a consolidated basis for any period, Consolidated Net Income,
but before payment or provision for (a) any income taxes for such period, (b)
Consolidated Total Interest Expense for such period, (c) depreciation for such
period, (d) amortization for such period, and (e) all other noncash charges
for such period, all determined in accordance with generally accepted
accounting principles.
CONSOLIDATED EBITDAR. For any period, the sum of (a) Consolidated
EBITDA for such period, PLUS (b) Consolidated Rental Expense for such period.
CONSOLIDATED FUNDED DEBT. At any time of determination, the sum of
(i) the amount of the Loans outstanding (after giving account to any amounts
requested and without duplication of amounts on account of conversions of
Loans from one Type to another Type and continuations of any Type of Loans as
such); PLUS (ii) the outstanding amount of any other Indebtedness for borrowed
money, in respect of Capitalized Leases or which is otherwise subject to the
payment of interest.
CONSOLIDATED NET INCOME. With respect to the Borrower and its
Subsidiaries on a consolidated basis for any period, the consolidated earnings
(or loss) from operations of the Borrower and its Subsidiaries for such
period, after eliminating therefrom all extraordinary nonrecurring items of
income (including gains on the sale of assets and earnings from the sale of
discontinued business lines), and after all expenses and other proper charges,
all determined in accordance with generally accepted accounting principles.
CONSOLIDATED NET WORTH. The excess of Consolidated Total Assets over
Consolidated Total Liabilities, LESS, to the extent otherwise includable in
the computations of Consolidated Net Worth, any subscriptions receivable.
CONSOLIDATED RENTAL EXPENSE. For any period, all rental expense of
the Borrower and its Subsidiaries during such period, determined on a
consolidated basis in accordance with generally accepted accounting
principles, incurred under any rental agreements or leases of real or personal
property, including space leases and ground leases, other than obligations in
respect of any Capitalized Leases.
CONSOLIDATED TANGIBLE NET WORTH. The excess of Consolidated Total
Assets over Consolidated Total Liabilities, and less the sum of:
(a) the total book value of all assets of the Borrower and its
Subsidiaries properly classified as intangible assets under generally
accepted accounting principles, including such items as goodwill, the
purchase price of acquired assets in excess of the fair market value
thereof, trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect to the
foregoing; plus
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(b) all amounts representing any write-up in the book value of
any assets of the Borrower or its Subsidiaries resulting from a
revaluation thereof subsequent to the Balance Sheet Date; plus
(c) to the extent otherwise includable in the computation of
Consolidated Tangible Net Worth, any subscriptions receivable.
CONSOLIDATED TOTAL ASSETS. All assets of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles.
CONSOLIDATED TOTAL INTEREST EXPENSE. For any period, the aggregate
amount of interest required to be paid or accrued by the Borrower and its
Subsidiaries during such period on all Indebtedness of the Borrower and its
Subsidiaries outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized (excluding capitalized interest relating to construction projects
determined in accordance with generally accepted accounting principles),
including payments consisting of interest in respect of any Capitalized Lease,
and including commitment fees, agency fees and facility fees, all exclusive of
investment income.
CONSOLIDATED TOTAL LIABILITIES. All liabilities of the Borrower and
its Subsidiaries determined on a consolidated basis in accordance with
generally accepted accounting principles.
CONTROL OR CONTROLLED BY. Possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether
through ownership of Voting Stock, by contract or otherwise); PROVIDED,
HOWEVER, that in any event any Person which beneficially owns, directly or
indirectly, 10% or more (in number of votes) of the Voting Stock of a
corporation shall be conclusively presumed to control such corporation.
CONVERSION REQUEST. A notice given by the Borrower to the Agent of
the Borrower's election to convert or continue a Loan in accordance with
Section 2.9.
CREDIT AGREEMENT. This Revolving Credit Agreement, including the
Schedules and Exhibits hereto.
DEFAULT. See Section 13.1.
DELINQUENT BANK. See Section 15.5.3.
DERIVATIVE TRANSACTIONS. Every obligation of any Person under any
forward contract, futures contract, swap, option or other financing agreement
or arrangement (including, without limitation, caps, floors, collars and
similar agreements), the value of which is dependent upon interest rates,
currency exchange rates, commodities or other indices.
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DISTRIBUTION. The declaration or payment of any dividend on or in
respect of any shares of any class of Capital Stock of the Borrower, other
than dividends payable solely in shares of common stock of the Borrower; the
purchase, redemption, or other retirement of any shares of any class of
Capital Stock of the Borrower, directly or indirectly through a Subsidiary of
the Borrower or otherwise (including agreements to purchase shares in the
future); the return of capital by the Borrower to its shareholders as such; or
any other distribution on or in respect of any shares of any class of Capital
Stock of the Borrower.
DOCUMENTARY FRONTING FEE. See Section 4.6.
DOLLARS or $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 hereto; thereafter, upon written notice to
the Borrower and the Agent, such other office of such Bank, if any, located
within the United States that will be making or maintaining Base Rate Loans.
DRAWDOWN DATE. The date on which any Loan is made or is to be made,
and the date on which any Loan is converted or continued in accordance with
Section 2.9.
ELIGIBLE ASSIGNEE. Any of (i) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $1,000,000,000;
(ii) a savings and loan association or savings bank organized under the laws
of the United States, or any State thereof or the District of Columbia, and
having a net worth of at least $100,000,000, calculated in accordance with
generally accepted accounting principles; (iii) a commercial bank organized
under the laws of any other country which is a member of the Organization for
Economic Cooperation and Development (the "OECD"), or a political subdivision
of any such country, and having total assets in excess of $1,000,000,000,
PROVIDED that such bank is acting through a branch or agency located in the
country in which it is organized or another country which is also a member of
the OECD; (iv) the central bank of any country which is a member of the OECD;
and (v) if, but only if, any Event of Default has occurred and is continuing,
any other bank, insurance company, commercial finance company or other
financial institution or other Person approved by the Agent, such approval not
to be unreasonably withheld.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning
of Section 3(3) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.
ENVIRONMENTAL LAWS. RCRA, CERCLA, SARA, the Federal Clean Water Act,
the Federal Clean Air Act, the Toxic Substances Control Act, or any state or
local statute, regulation, ordinance, order or decree relating to health,
safety or the environment.
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EPA. The United States Environmental Protection Agency.
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA AFFILIATE. Any Person which is treated as a single employer
with the Borrower under Section 414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a
Guaranteed Pension Plan within the meaning of Section 4043 of ERISA and the
regulations promulgated thereunder.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any lender
subject thereto would be required to maintain reserves under Regulation D of
the Board of Governors of the Federal Reserve System (or any successor or
similar regulations relating to such reserve requirements) against
"Eurocurrency Liabilities" (as that term is used in such Regulation D), if
such liabilities were outstanding. The Eurocurrency Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in the
Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open
for international business (including dealings in Dollar deposits) in London
or such other Eurodollar Interbank Market as may be selected by the Agent in
its sole discretion acting in good faith.
EURODOLLAR INTERBANK MARKET. Any lawful recognized market in which
deposits of United States dollars are offered by international banking units
of United States banking institutions and by foreign, banking institutions to
each other, and where the eurodollar and foreign currency and exchange
operations of the Agent are customarily conducted.
EURODOLLAR LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 hereto; thereafter, upon written notice to
the Borrower and the Agent, such other office of such Bank, if any, that shall
be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (i) the rate per annum (rounded
upwards to the nearest 1/16 of one percent) at which the Agent's Eurodollar
Lending Office is offered Dollar deposits two Eurodollar Business Days prior
to the beginning of such Interest Period in the Eurodollar Interbank Market
for delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan of the Agent to which such Interest Period applies, divided by (ii)
a number equal to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
EURODOLLAR RATE LOANS. Syndicated Loans bearing interest calculated
by reference to the Eurodollar Rate.
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EVENT OF DEFAULT. See Section 13.1.
EXCHANGE ACT. The Securities Exchange Act of 1934, as amended.
FEE LETTER. The letter agreement regarding fees, dated or to be dated
on or prior to the Closing Date, among the Borrower, the Agent and the
Arranger and in form and substance satisfactory to the Agent and the Arranger.
FISCAL YEAR. The fiscal (or financial, as applicable) year of the
Borrower and its Subsidiaries.
FIXED CHARGE COVERAGE RATIO. The ratio of (a) Consolidated EBITDAR
for the four fiscal quarters most recently ended MINUS Capital Expenditures
for such period to (b) the sum of (i) Consolidated Total Interest Expense for
such period PLUS, without duplication, (ii) any scheduled amortization of
principal on Indebtedness (including amortization relating to Capitalized
Leases) for such period PLUS (iii) Consolidated Rental Expense for such period.
FLEET. Fleet National Bank, a national banking association, in its
individual capacity.
FOREIGN SUBSIDIARY. Any Subsidiary of the Borrower not organized
under the laws of the United States of America or the Dominion of Canada.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. (i) When used in Section 9,
whether directly or indirectly through reference to a capitalized term used
therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date,
and (B) to the extent consistent with such principles, the accounting practice
of the Borrower reflected in its financial statements for the year ended on
the Balance Sheet Date, and (ii) when used in general, other than as provided
above, means principles that are (A) consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, as in effect from time to time, and (B) consistently applied
with past financial statements of the Borrower adopting the same principles,
provided that in each case referred to in this definition of "generally
accepted accounting principles" a certified public accountant would, insofar
as the use of such accounting principles is pertinent, be in a position to
deliver an unqualified opinion (other than a qualification regarding changes
in generally accepted accounting principles) as to financial statements in
which such principles have been properly applied.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower
or any ERISA Affiliate the benefits of which are guaranteed on termination in
full or in part by the PBGC pursuant to Title IV of ERISA, other than a
Multiemployer Plan.
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GUARANTOR. ABI and any other Subsidiary which becomes a party to the
Guaranty.
GUARANTY. A Guaranty, made by a Subsidiary of the Borrower in favor
of the Banks and the Agent pursuant to which such Subsidiary of the Borrower
guaranties to the Banks and the Agent the payment and performance of the
Obligations and in form and substance satisfactory to the Agent.
HAZARDOUS SUBSTANCES. Any hazardous waste, as defined by 42 U.S.C.
Section 6903(5), any hazardous substances as defined by 42 U.S.C. Section
9601(14), any pollutant or contaminant as defined by 42 U.S.C. Section
9601(33) and any toxic substances, oil or hazardous materials or other
chemicals or substances regulated by any Environmental Laws.
INDEBTEDNESS. As to any Person and whether recourse is secured by or
is otherwise available against all or only a portion of the assets of such
Person and whether or not contingent, but without duplication:
(i) every obligation of such Person for money borrowed,
(ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or
businesses,
(iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of such Person,
(iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (including securities
repurchase agreements but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business),
(v) every obligation of such Person under any Capitalized
Lease,
(vi) every obligation of such Person (an "equity related
purchase obligation") to purchase, redeem, retire or otherwise acquire
for value any shares of capital stock of any class issued by such
Person, any warrants, options or other rights to acquire any such
shares, or any rights measured by the value of such shares, warrants,
options or other rights, excluding stock options, warrants or other
rights granted to former and current directors, officers, consultants
and employees under compensation agreements,
(vii) every obligation, contingent or otherwise, of such
Person guaranteeing, or having the economic effect of guarantying or
otherwise acting as surety for, any obligation of a type described in
any of clauses (i) through (vi) (the "primary obligation") of another
Person (the "primary
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obligor"), in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such Person (A) to
purchase or pay (or advance or supply funds for the purchase of) any
security for the payment of such primary obligation, (B) to purchase
property, securities or services for the purpose of assuring the
payment of such primary obligation, or (C) to maintain working capital,
equity capital or other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such
primary obligation, and
(viii) all sales by such Person of (a) accounts or general
intangibles for money due or to become due, (b) chattel paper,
instruments or documents creating or evidencing a right to payment of
money or (c) other receivables (collectively "RECEIVABLES"), whether
pursuant to a purchase facility or otherwise, other than in each case
in connection with the disposition of the business operations of such
Person relating thereto or a disposition of defaulted receivables for
collection and not as a financing arrangement, and together with any
obligation of such Person to pay any discount, interest, fees,
indemnities, penalties, recourse, expenses or other amounts in
connection therewith,
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (v) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with generally accepted
accounting principles, (w) any Capitalized Lease shall be the principal
component of the aggregate of the rentals obligation under such Capitalized
Lease payable over the term thereof that is not subject to termination by the
lessee, and (x) any equity related purchase obligation shall be the maximum
fixed redemption or purchase price thereof inclusive of any accrued and unpaid
dividends to be comprised in such redemption or purchase price.
INELIGIBLE SECURITIES. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
INTEREST PAYMENT DATE. (i) As to any Base Rate Loan, quarterly in
arrears on the first day of each calendar quarter for the immediately
preceding calendar quarter commencing on the first such date following the
Closing Date with respect to interest accrued during the previous calendar
quarter, including, without limitation, the calendar quarter which includes
the Drawdown Date of such Base Rate Loan; (ii) as to any Eurodollar Rate Loan
in respect of which the Interest Period is (A) 3 months or less, the last day
of such Interest Period and (B) more than 3 months, the date that is 3 months
from the first day of such Interest Period and, in addition, the last day of
such Interest Period; and (iii) as to any Competitive Bid Loan, the last day
of the Interest Period applicable thereto.
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INTEREST PERIOD. With respect to each Loan, (i) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrower in a Loan Request
or Notice of Competitive Bid Borrowing (A) for any Base Rate Loan, the last
day of the calendar quarter; (B) for any Eurodollar Rate Loan, 1, 2, 3, 4, 5,
or 6 months; and (C) for any Competitive Bid Loan, a period up to 180 days;
and (ii) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Loan and ending on the last day
of one of the periods set forth above, as selected by the Borrower in a
Conversion Request; PROVIDED that all of the foregoing provisions relating to
Interest Periods are subject to the following:
(a) if any Interest Period with respect to a Eurodollar Rate
Loan would otherwise end on a day that is not a Eurodollar Business
Day, that Interest Period shall be extended to the next succeeding
Eurodollar Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(b) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in
Section 2.9, the Borrower shall be deemed to have requested a
conversion of the affected Eurodollar Rate Loan to a Base Rate Loan
and the continuance of all Base Rate Loans as Base Rate Loans on the
last day of the then current Interest Period with respect thereto;
(d) any Interest Period relating to any Eurodollar Rate Loan
that begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurodollar Business Day of a calendar month; and
(e) any Interest Period that would otherwise extend beyond the
Revolving Credit Loan Maturity Date shall end on the Revolving Credit
Loan Maturity Date.
INVESTMENTS. All expenditures made and all liabilities incurred by a
Person (contingently or otherwise) for the acquisition of Capital Stock or
Indebtedness of, or for loans, advances (excluding any loans and advances to
officers, directors or employees made in the ordinary course of business
consistent with past practice), capital contributions (including without
limitation capital contributions consisting of transfers of property), or in
respect of any guaranties of Indebtedness (or other commitments as described
under Indebtedness) of any other Person. In determining the aggregate amount of
Investments outstanding at any particular time: (i) the amount of any
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Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (ii)
there shall be deducted in respect of each such Investment any amount received
as a return of capital (but only by repurchase, redemption, retirement,
repayment, dividend or distribution); and (iii) there shall not be deducted
from the aggregate amount of Investments any decrease in the value thereof.
INVITATION FOR COMPETITIVE BID QUOTES. See Section 2.3.1(c).
ISSUING BANK. Fleet or any other Bank or their agents, as issuer of a
Letter of Credit.
LETTER OF CREDIT. See Section 4.1.1.
LETTER OF CREDIT APPLICATION. See Section 4.1.1.
LETTER OF CREDIT FEE. See Section 4.6.
LETTER OF CREDIT PARTICIPATION. See Section 4.1.4.
LOAN DOCUMENTS. This Credit Agreement, the Notes, the Letter of
Credit Applications, the Letters of Credit and any Guaranties.
LOAN REQUEST. See Section 2.2.1.
LOANS. Revolving credit loans made or to be made by the Banks to the
Borrower pursuant to Section 2, whether Syndicated Loans or Competitive Bid
Loans.
MAJORITY BANKS. As of any date, the Banks (excluding any Delinquent
Banks as of such date) whose aggregate Commitments constitute at least
fifty-one percent (51%) of the Total Commitment as reduced by the Commitments
of any Delinquent Banks on such date.
MAXIMUM COMPETITIVE BID AMOUNT. $25,000,000.
MAXIMUM DRAWING AMOUNT. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as
such aggregate amount may be reduced from time to time pursuant to the terms
of the Letters of Credit.
MC. Michaels of Canada, ULC, a Nova Scotia unlimited liability
company and wholly owned Subsidiary of the Borrower.
MPR. Michaels Stores of Puerto Rico, Inc., a Delaware corporation and
wholly owned Subsidiary of the Borrower.
MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate.
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NOTES. The Competitive Bid Notes and the Syndicated Notes.
NOTICE OF COMPETITIVE BID BORROWING. See Section 2.3.1(f).
OBLIGATIONS. All Indebtedness, obligations and liabilities of the
Borrower and any Guarantor to any of the Banks and the Agent, individually or
collectively, existing on the date of this Credit Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured,
arising by contract, operation of law or otherwise, arising or incurred under
this Credit Agreement or any of the other Loan Documents or in respect of any
of the Loans made or Reimbursement Obligations incurred or any of the Notes,
Letter of Credit Applications, Letters of Credit or other instruments at any
time evidencing any thereof.
OPERATING ACCOUNTS. See Section 2.2.2.
OUTSTANDING. With respect to the Loans, the aggregate unpaid
principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section
4002 of ERISA and any successor entity or entities having similar
responsibilities.
PERMITTED HOLDERS. Sam Wyly, Charles J. Wyly, Jr., Evan A. Wyly, any
of their lineal descendants, trusts established by or for the benefit of any
such Persons, entities controlled by any such trusts, and their respective
Affiliates.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted by Section 9.2.
PERSON. Any individual, corporation, partnership, trust,
unincorporated association, business, or other legal entity, and any
government or any governmental agency or political subdivision thereof.
RATE ADJUSTMENT PERIOD. See definition for Applicable Margin.
RCRA. The Resource Conservation and Recovery Act.
REAL ESTATE. All real property at any time owned by the Borrower or
any of its Subsidiaries and located within the United States of America.
RECORD. The grid attached to a Note, or the continuation of such
grid, or any other similar record, including computer records, maintained by
any Bank with respect to any Loan referred to in such Note.
REGISTER. See Section 19.3.
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REIMBURSEMENT OBLIGATION. The Borrower's obligation to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in Section 4.2.
REVOLVING CREDIT LOAN MATURITY DATE. (a) April 30, 2004, or (b) April
30, 2005, PROVIDED that the Banks approve the Revolving Credit Loan Maturity
Extension pursuant to Section 3.1(b) of this Agreement.
REVOLVING CREDIT LOAN MATURITY EXTENSION. See Section 3.1(b).
REVOLVING CREDIT LOAN MATURITY EXTENSION REQUEST. See Section 3.1(b).
ROYALTY PAYMENTS. Payments made to 5931, Inc. or 5931 Business Trust
in an aggregate amount not to exceed 3-1/2% of consolidated revenues of the
Borrower and its Subsidiaries on an aggregate, cumulative, consolidated basis
in accordance with generally accepted accounting principles.
SARA. The Superfund Amendments and Reauthorization Act of 1986.
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible Securities.
SENIOR FINANCIAL OFFICER. Any person holding the Borrower's office of
Executive Vice President and Chief Financial Officer, Vice President - Finance
or Treasurer or any other person performing similar functions.
SENIOR NOTES INDENTURE. That certain Indenture, dated as of June 21,
1996, between the Borrower and The Bank of New York, as Trustee, as the same
shall be amended, restated, modified, extended, renewed or replaced.
SENIOR NOTES. Those certain 10 7/8% Senior Notes due 2006, in a face
amount of $125,000,000 as of the Closing Date, issued pursuant to the Senior
Notes Indenture, as each shall be amended, restated, modified, extended,
renewed or replaced.
SETTLEMENT. The making or receiving of payments, in immediately
available funds, by the Banks and Agent (with respect to Syndicated Loans made
pursuant to Section 2.2.2 only), to the extent necessary to cause each Bank's
actual share of the outstanding amount of Syndicated Loans (after giving
effect to any Loan Request) to be equal to such Bank's Commitment Percentage
of the outstanding amount of such Syndicated Loans (after giving effect to any
Loan Request), in any case where, prior to such event or action, the actual
share is not so equal.
SETTLEMENT AMOUNT. See Section 2.5.1.
SETTLEMENT DATE. (a) The Drawdown Date relating to any Loan Request,
(b) Friday of each week, or if a Friday is not a Business Day, the Business Day
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immediately following such Friday, (c) at the option of the Agent, on any
Business Day following a day on which the account officers of the Agent active
upon the Borrower's account become aware of the existence of an Event of
Default, (d) any Business Day on which the amount of Syndicated Loans
outstanding from Fleet PLUS Fleet 's Commitment Percentage of the sum of the
Maximum Drawing Amount and any Unpaid Reimbursement Obligations is equal to or
greater than Fleet 's Commitment Percentage of the Total Commitment, (e) the
Business Day immediately following any Business Day on which the amount of
Loans outstanding increases or decreases by more than $5,000,000 as compared
to the previous Settlement Date, (f) any day on which any conversion of a Base
Rate Loan to a Eurodollar Rate Loan occurs, or (g) any Business Day on which
(i) the amount of outstanding Syndicated Loans decreases and (ii) the amount
of the Agent's Syndicated Loans outstanding equals zero Dollars ($0).
SETTLING BANK. See Section 2.5.1.
STANDBY FRONTING FEE. See Section 4.6.
SUBORDINATION AGREEMENT. The Third Amended and Restated Subordination
Agreement, dated as of May 1, 2001, made by 5931 Business Trust, 5931, Inc.
and the Borrower, in favor of the Agent, for the benefit of itself and each
Bank party to the Credit Agreement and The Bank of New York, as Trustee for
the Senior Notes.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
SYNDICATED LOAN(S). See Section 2.1.
SYNDICATED NOTES. See Section 2.6.1.
TOTAL CAPITAL. For any period, an amount equal to the sum of (i)
Consolidated Net Worth for such period, PLUS (b) the aggregate outstanding
amount of Consolidated Funded Debt for such period.
TOTAL COMMITMENT. The sum of the Commitments of the Banks, as in
effect from time to time, which amount shall, as of the Closing Date, be
$200,000,000.
TOTAL OUTSTANDING. The sum of (i) the outstanding aggregate principal
amount of Syndicated Loans and Competitive Bid Loans, PLUS (ii) the Maximum
Drawing Amount and Unpaid Reimbursement Obligations.
TYPE. As to any Syndicated Loan, its nature as a Base Rate Loan or a
Eurodollar Rate Loan.
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UNIFORM CUSTOMS. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto
adopted by the Agent in the ordinary course of its business as a letter of
credit issuer and in effect at the time of issuance of such Letter of Credit.
UNITED STATES SUBSIDIARY. Any Subsidiary of the Borrower organized
under the laws of the United States of America.
UNPAID REIMBURSEMENT OBLIGATION. Any Reimbursement Obligation for
which the Borrower does not reimburse the Agent and the Banks on the date
specified in, and in accordance with, Section 4.2.
UTILIZATION FEE. See Section 5.3.
VOTING STOCK. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of the directors (or persons performing
similar functions) of the corporation, association, trust or other business
entity involved, whether or not the right so to vote exists by reason of the
happening of a contingency.
5931 BUSINESS TRUST. 5931 Business Trust, a Delaware business trust.
5931, INC. 5931, Inc., a Delaware corporation and a wholly owned
Subsidiary of the Borrower.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from
time to time in accordance with its terms and the terms of this Credit
Agreement.
(b) The singular includes the plural and the plural includes
the singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted
successors and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
(f) The words "include", "includes" and "including" are not
limiting.
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(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the State of New York have the meanings
assigned to them therein, with the term "instrument" being that defined
under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "Section " refers to that
section of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Credit Agreement as a whole and not to
any particular section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation
of periods of time from a specified date to a later specified date, the
word "from" means "from and including," the words "to" and "until" each
mean "to but excluding," and the word "through" means "to and
including."
(k) This Credit Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the
same or similar matters. All such limitations, tests and measurements
are, however, cumulative and are to be performed in accordance with the
terms thereof.
(l) This Credit Agreement and the other Loan Documents are the
result of negotiation among, and have been reviewed by counsel to,
among others, the Agent and the Borrower and are the product of
discussions and negotiations among all parties. Accordingly, this
Credit Agreement and the other Loan Documents are not intended to be
construed against the Agent or any of the Banks merely on account of
the Agent's or any Bank's involvement in the preparation of such
documents.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND SYNDICATED LOANS. Subject to the terms and
conditions set forth in this Credit Agreement, each of the Banks severally
agrees to lend to the Borrower and the Borrower may borrow, repay, and
reborrow from time to time between the Closing Date and the Revolving Credit
Loan Maturity Date upon notice by the Borrower to the Agent given in
accordance with Section 2.2, such sums ("SYNDICATED LOANS") as are requested
by the Borrower up to a maximum aggregate principal amount outstanding (after
giving effect to all amounts requested) at any one time equal to such Bank's
Commitment (without regard to any Competitive Bid Loans of such Bank
outstanding at such time) MINUS such Bank's Commitment Percentage of the sum
of the Maximum Drawing Amount and all Unpaid Reimbursement Obligations,
PROVIDED that the Total Outstanding shall not at any time exceed the Total
Commitment. Subject to Section 2.2.2 and Section 2.5, the Syndicated Loans
shall be made PRO RATA in accordance with each Bank's Commitment Percentage.
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Each request for a Syndicated Loan hereunder shall constitute a representation
and warranty by the Borrower that the conditions set forth in Section 11 and
Section 12, in the case of the initial Syndicated Loans to be made on the
Closing Date, and Section 12, in the case of all other Syndicated Loans, have
been satisfied on the date of such request.
2.2. REQUESTS FOR LOANS.
2.2.1. GENERAL. The Borrower shall give to the Agent written
notice in the form of EXHIBIT A hereto (or telephonic notice confirmed
in a writing in the form of EXHIBIT A hereto) of each Syndicated Loan
requested hereunder (a "LOAN REQUEST") by 12:00 noon (Boston time) (i)
on the proposed Drawdown Date of any Base Rate Loan and (ii) three (3)
Eurodollar Business Days prior to the proposed Drawdown Date of any
Eurodollar Rate Loan. Each Loan Request shall specify (A) the principal
amount of the Syndicated Loan requested, (B) the proposed Drawdown Date
of such Syndicated Loan, (C) the Interest Period for such Syndicated
Loan and (D) the Type of such Syndicated Loan. Promptly upon receipt of
any Loan Request, the Agent shall notify each of the Banks thereof.
Each such Loan Request from the Borrower shall be irrevocable and
binding on the Borrower and shall obligate the Borrower to accept the
Syndicated Loan requested from the Banks on the proposed Drawdown Date.
Each Loan Request shall be in a minimum aggregate principal amount of
$1,000,000 or any integral multiple of $100,000 in excess thereof.
2.2.2. SWING LINE. Notwithstanding the notice and amount
requirements set forth in Section 2.2.1 but otherwise in accordance
with the terms and conditions of this Credit Agreement, the Agent may,
in its sole discretion and without conferring with the Banks, make
Syndicated Loans to the Borrower (i) by entry of credits to the
Borrower's accounts with the Agent designated by the Agent in its
discretion for such purpose (collectively, the "OPERATING ACCOUNTS")
to cover checks or other charges which the Borrower has drawn or made
against such accounts or (ii) in an amount as otherwise requested by
the Borrower. The Borrower hereby requests and authorizes the Agent to
make from time to time such Syndicated Loans by means of appropriate
entries of such credits sufficient to cover checks and other charges
then presented for payment from the Operating Accounts or as otherwise
so requested. The Borrower acknowledges and agrees that the making of
such Syndicated Loans shall, in each case, be subject in all respects
to the provisions of this Credit Agreement as if they were Syndicated
Loans covered by a Loan Request including, without limitation, the
limitations set forth in Section 2.1 and the requirements that the
applicable provisions of Section 11 (in the case of Syndicated Loans
made on the Closing Date) and Section 12 be satisfied. All
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actions taken by the Agent pursuant to the provisions of this Section
2.2.2 shall be conclusive and binding on the Borrower and the Banks
absent manifest error or the Agent's gross negligence or willful
misconduct. Syndicated Loans made pursuant to this Section 2.2.2 shall
be Base Rate Loans until converted in accordance with the provisions of
this Credit Agreement and, prior to a Settlement, such interest shall
be for the account of the Agent.
2.3. COMPETITIVE BID LOANS.
2.3.1. COMPETITIVE BID BORROWINGS. (a) THE COMPETITIVE BID
OPTION. In addition to the Syndicated Loans permitted to be made
hereunder pursuant to Section 2.1, the Borrower may, from time to
time from the Closing Date until the Revolving Credit Loan Maturity
Date pursuant to the terms of this Section 2.3, cause the Agent to
request the Banks to make offers to fund Competitive Bid Loans to the
Borrower. The Banks may, but shall have no obligation to, make such
offers and the Borrower may, but shall have no obligation to, accept
such offers in the manner set forth in this Section 2.3. Each Bank
may make Competitive Bid Loans as provided in this Section 2.3.
(b) COMPETITIVE BID QUOTE REQUEST. When the Borrower wishes to
request offers to make Competitive Bid Loans under this Section 2.3, it
shall transmit to the Agent by telex or facsimile a Competitive Bid
Quote Request substantially in the form of EXHIBIT B attached hereto (a
"Competitive Bid Quote Request") so as to be received no later than
1:00 p.m. (Boston time) two (2) Business Days prior to the requested
Drawdown Date, specifying (i) the requested Drawdown Date (which must
be a Business Day), (ii) the principal amount of such Competitive Bid
Loan (which must be a minimum of $5,000,000 or any greater integral
multiple of $1,000,000 and may not exceed the lesser of (A) the Maximum
Competitive Bid Amount and (B) the Total Commitment), and (iii) the
Interest Period of such Competitive Bid Loan (which may not extend
beyond the Revolving Credit Loan Maturity Date). Contemporaneously with
the transmission of each Competitive Bid Quote Request, the Borrower
shall pay to the Agent, for the Agent's own account, a work fee in the
amount of $1,250. The Borrower may request offers to make Competitive
Bid Loans for one amount and three Interest Periods in a single
Competitive Bid Quote Request.
(c) INVITATION FOR COMPETITIVE BID QUOTES; ALTERNATIVE MANNER
OF AUCTION. Subsequent to timely receipt of a Competitive Bid Quote
Request, the Agent shall send to the Banks by telex or facsimile an
Invitation for Competitive Bid Quotes substantially in the form of
EXHIBIT C attached hereto (an "Invitation for Competitive Bid Quotes"),
as promptly as possible but not later than 3:00 p.m. (Boston time) on
the Business Day prior to the requested Drawdown Date which shall
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constitute an invitation by the Borrower to each Bank to submit
Competitive Bid Quotes offering to make Competitive Bid Loans to
which such Competitive Bid Quote Request relates in accordance with
this Section 2.3. If, after receipt by the Agent of a Competitive Bid
Quote Request from the Borrower in accordance with subsection (b) of
this Section 2.3.1, the Agent or any Bank shall be unable to complete
any procedure of the auction process described in subsections (c)
through (f) (inclusive) of this Section 2.3.1 due to the inability of
such Person to transmit or receive communications through the means
specified therein, such Person may rely on telephonic notice for the
transmission or receipt of such communications. In any case where
such Person shall rely on telephone transmission or receipt, any
communication made by telephone shall, as soon as possible
thereafter, be followed by written confirmation thereof.
(d) SUBMISSION AND CONTENTS OF COMPETITIVE BID QUOTES.
(i) Each Bank may submit a Competitive Bid Quote
containing an offer or offers to make Competitive Bid Loans in
response to any Invitation for Competitive Bid Quotes. Each
Competitive Bid Quote must comply with the requirements of
this subsection (d) and must be submitted to the Agent by
telex or facsimile not later than 10:00 a.m. (Boston time) on
the requested Drawdown Date, PROVIDED that Competitive Bid
Quotes may be made by the Agent in its capacity as a Bank only
if it notifies the Borrower of the terms of its Competitive
Bid Quote no later than 9:30 a.m. (Boston time) on the
requested Drawdown Date. Subject to the requirements that the
applicable provisions of Section 12 be satisfied, any
Competitive Bid Quote so made shall be irrevocable except with
the written consent of the Agent given on the instructions of
the Borrower.
(ii) Each Competitive Bid Quote shall be in
substantially the form of EXHIBIT D-1 attached hereto (a
"Competitive Bid Quote") and shall in any case specify:
(A) the requested Drawdown Date and Interest
Periods relating thereto,
(B) the principal amount of the Competitive
Bid Loan for which each such offer is being made,
which principal amount (X) may be greater than the
Commitment Amount of the quoting Bank but may not
exceed the lesser of (I) the Maximum Competitive Bid
Amount and (II) the Total Commitment, (Y) must be
$5,000,000 or a larger multiple of $1,000,000 and (Z)
may not exceed the aggregate principal amount of
Competitive Bid Loans for which offers were
requested,
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(C) the rate of interest per annum (rounded
to the nearest 1/1000th of 1%) (the "Competitive Bid
Rate") offered for each such Competitive Bid Loan,
and
(D) the identity of the quoting Bank.
(iii) Any Competitive Bid Quote shall be disregarded
if it:
(A) is not substantially in the form of
EXHIBIT D-1 attached hereto or does not specify all
of the information required by subsection (d)(ii) of
this Section 2.3.1;
(B) contains qualifying, conditional or
similar language (except that it may, in the case of
a quote relating to more than one Interest Period,
contain the condition that the Bank will fund any
one, but not more, of the Competitive Bid Loans
offered in such Competitive Bid Quote);
(C) proposes terms other than or in addition
to those set forth in the applicable Invitation for
Competitive Bid Quotes; or
(D) arrives after the time set forth in
subsection (d)(i) of this Section 2.3.1.
(e) NOTICE TO BORROWER. Not later than 10:30 a.m. (Boston
time) on the requested Drawdown Date, the Agent shall notify the
Borrower of the terms of all Competitive Bid Quotes submitted by the
Banks in accordance with subsection (d) of this Section 2.3.1. The
Agent's notice to the Borrower shall specify (i) the aggregate
principal amount of Competitive Bid Loans for which Competitive Bid
Quotes have been received for each Interest Period specified in the
related Competitive Bid Quote Request, (ii) the respective principal
amounts and Competitive Bid Rates so offered in each Competitive Bid
Quote, and (iii) the identity of the Bank that shall have made such
Competitive Bid Quote.
(f) ACCEPTANCE AND NOTICE BY BORROWER. Not later than 11:00
a.m. (Boston time) on the requested Drawdown Date, the Borrower shall
notify the Agent, and the Agent shall promptly notify each Bank with
respect to its Competitive Bid Quote, of the Borrower's acceptance or
non-acceptance of the offers of which it was notified pursuant to
subsection (e) of this Section 2.3.1. In the case of an acceptance,
such notice shall (i) be substantially in the form of EXHIBIT D-2
attached hereto (a "Notice of Competitive Bid Borrowing"), (ii) be
irrevocable by the Borrower, and (iii) specify the aggregate
principal amount of Competitive Bid Quote for each Interest Period
that are accepted. Each acceptance by the Borrower of Competitive Bid
Quotes hereunder shall constitute a representation and
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warranty by the Borrower that the conditions set forth in Section 12
have been satisfied on the date of such acceptance. The Borrower may
accept any Competitive Bid Quote in whole or in part; PROVIDED that:
(A) the aggregate principal amount of each
Competitive Bid Loan may not exceed the applicable
amount set forth in the related Competitive Bid Quote
Request,
(B) the aggregate principal amount of each
Competitive Bid Loan must be $5,000,000 or a larger
multiple of $1,000,000, and
(C) the Borrower may not accept a
Competitive Bid Quote made at a particular
Competitive Bid Rate if the Borrower rejects a
Competitive Bid Quote made at a lower Competitive Bid
Rate.
(g) ALLOCATION BY AGENT. If Competitive Bid Quotes are made by
two or more Banks with the same Competitive Bid Rates, for a greater
aggregate principal amount than the amount in respect of which
Competitive Bid Quotes are accepted for the related Interest Period,
the principal amount of Competitive Bid Loans in respect of which such
offers are accepted shall be allocated by the Agent among such Banks as
nearly as possible (in such multiples, not less than $100,000 as the
Agent may deem appropriate) in proportion to the aggregate principal
amounts of such Competitive Bid Quotes. If any such Bank has indicated
a minimum acceptable Competitive Bid Loan in its Competitive Bid Quote,
and under the procedures of this subsection (g), the Agent would have
allocated to it an amount less than such minimum, such Competitive Bid
Quote will instead be deemed to have been withdrawn. Determination by
the Agent of the amounts of Competitive Bid Loans and the allocation
thereof shall be conclusive in the absence of manifest error. The Agent
shall, promptly after the funding of any Competitive Bid Loan, notify
the Banks thereof pursuant to a notice substantially in the form of
EXHIBIT D-3 attached hereto.
(h) FUNDING OF COMPETITIVE BID LOANS. If, on or prior to the
Drawdown Date of any Competitive Bid Loan, the Total Commitment has
not terminated in full and if, on such Drawdown Date, the applicable
conditions of Section 12 are satisfied, the Bank or Banks whose
Competitive Bid Quotes the Borrower has accepted will fund each
Competitive Bid Loan so accepted as provided in Section 2.4.1.
2.3.2. MAXIMUM COMPETITIVE BID LOANS; FUNDING LOSSES. (a)
Notwithstanding any other provision herein to the contrary, at no time
shall the aggregate principal amount of Competitive Bid Loans
outstanding at any time exceed the lesser of (i) the Total Commitment
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MINUS Total Outstanding other than the outstanding principal amount of
Competitive Bid Loans and (ii) the Maximum Competitive Bid Amount.
(b) If after acceptance of any Competitive Bid Quote
pursuant to Section 2.3.1(f), the Borrower fails to borrow any
Competitive Bid Loan so accepted on the date specified therefor, the
Borrower shall indemnify the Bank funding such Loan against any loss
or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Bank to fund or maintain
such unborrowed Competitive Bid Loans, as provided in Section 5.10.
2.3.3. REPAYMENT OF COMPETITIVE BID LOANS. The principal of
each Competitive Bid Loan shall become absolutely due and payable by
the Borrower on the last day of the Interest Period relating thereto,
and the Borrower hereby absolutely and unconditionally promises to
pay to the Agent, for the accounts of the relevant Banks, on the last
day of the Interest Period relating thereto the principal amount of
all such Competitive Bid Loans PLUS interest thereon at the
applicable Competitive Bid Rate. Subject to the terms of this Credit
Agreement, the Borrower may reborrow any amounts so repaid from time
to time prior to the Revolving Credit Loan Maturity Date.
2.4. FUNDS FOR LOANS.
2.4.1. FUNDING PROCEDURES. Not later than 2:00 p.m. (Boston
time) on the proposed Drawdown Date of any Syndicated Loans or
Competitive Bid Loans, each Bank will make available to the Agent, at
the Agent's Head Office, in immediately available funds, the amount
of such Bank's Commitment Percentage of the amount of the requested
Syndicated Loans and the amount of such Bank's Competitive Bid Loans
accepted by the Borrower, if any. Upon receipt from each Bank of such
amount, and upon receipt of the documents required by Sections 11 and
12 to be delivered on or prior to such Drawdown Date, to the extent
applicable, and the satisfaction of the other conditions set forth
therein, to the extent applicable, the Agent will make available to
the Borrower the aggregate amount of such Loans. The failure or
refusal of any Bank to make available to the Agent the amount of its
Commitment Percentage of the requested Syndicated Loans or the amount
of its Competitive Bid Loans accepted by the Borrower at the
aforesaid time on any Drawdown Date shall not (i) relieve any other
Bank from its several obligations hereunder to make available to the
Agent the amount of such other Bank's Commitment Percentage of any
requested Syndicated Loans or the amount of such other Bank's
Competitive Bid Loans accepted by the Borrower or (ii) impose upon
any other Bank any liability with respect to such failure or refusal
or otherwise increase the Commitment of such other Bank.
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2.4.2. ADVANCES BY AGENT. The Agent may, unless notified to
the contrary by any Bank prior to a Drawdown Date, assume that such
Bank has made available to the Agent on such Drawdown Date the amount
of such Bank's Commitment Percentage of the Syndicated Loans (or, in
the case of Competitive Bid Loans, the amount of such Bank's
Competitive Bid Loans accepted by the Borrower, if any) to be made on
such Drawdown Date, and the Agent may (but it shall not be required
to), in reliance upon such assumption, make available to the Borrower a
corresponding amount. The Agent shall notify the Borrower by telephone
or telecopy to the Borrower of the failure of any Bank to make
available to the Agent the amount of its Commitment Percentage of the
Syndicated Loans or the amount of its Competitive Bid Loans accepted by
the Borrower on such Drawdown Date promptly after the Agent obtains
knowledge of such failure. If any Bank makes available to the Agent
such amount on a date after such Drawdown Date, such Bank shall pay to
the Agent on demand an amount equal to the product of (a) the average
computed for the period referred to in clause (c) below, of the
weighted average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period, TIMES
(b) the amount of such Bank's Commitment Percentage of such Syndicated
Loans (or in the case of Competitive Bid Loans, the amount of such
Bank's Competitive Bid Loans accepted by the Borrower, if any), TIMES
(c) a fraction, the numerator of which is the number of days that
elapse from and including such Drawdown Date to the date on which the
amount of such Bank's Commitment Percentage of such Syndicated Loans or
the amount of such Bank's Competitive Bid Loans accepted by the
Borrower, as applicable, shall become immediately available to the
Agent, and the denominator of which is 360. A statement of the Agent
submitted to such Bank with respect to any amounts owing under this
Section 2.4.2 shall be PRIMA FACIE evidence of the amount due and owing
to the Agent by such Bank. If the amount of such Bank's Commitment
Percentage of the Syndicated Loans (or the amount of such Bank's
Competitive Bid Loans accepted by the Borrower, as applicable,) is not
made available to the Agent by such Bank within three (3) Business Days
following such Drawdown Date, the Agent shall be entitled to recover
such amount from the Borrower within three (3) Business Days after
demand, with interest thereon at the rate per annum applicable to the
Syndicated Loans (or Competitive Bid Loans, as applicable), made on
such Drawdown Date; PROVIDED, HOWEVER, that until and unless such
payment has been made in full by the Borrower, such Bank shall remain
liable to the Agent for the full amount of such payment, including
interest as set forth above. Subject to Section 2.1 and Section 2.3, as
applicable, the Borrower may at any time within such three-day period
submit a new Loan Request or Competitive Bid Quote Request to the Agent
pursuant to Section 2.2 or Section 2.3.1(b), as applicable, covering
the amount set forth in the Agent's demand for payment. Any payment by
the Borrower to the Agent of any Syndicated Loans (or Competitive Bid
Loans) pursuant to this Section 2.4.2 shall be deemed to be a payment
of the
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Loans that were to be made by the Bank that failed to make such
Syndicated Loans or Competitive Bid Loans, as applicable.
2.5. SETTLEMENTS.
2.5.1. GENERAL. On each Settlement Date, the Agent shall,
not later than 11:00 a.m. (Boston time), give telephonic or facsimile
notice (i) to the Banks and the Borrower of the respective
outstanding amount of Syndicated Loans made by the Agent on behalf of
the Banks from the immediately preceding Settlement Date through the
close of business on the prior day and (ii) to the Banks of the
amount (a "SETTLEMENT AMOUNT") that each Bank (a "SETTLING BANK")
shall pay to effect a Settlement of any Syndicated Loan. A statement
of the Agent submitted to the Banks and the Borrower or to the Banks
with respect to any amounts owing under this Section 2.5 shall be
PRIMA FACIE evidence of the amount due and owing absent manifest
error. Each Settling Bank shall, not later than 3:00 p.m. (Boston
time) on such Settlement Date, effect a wire transfer of immediately
available funds to the Agent in the amount of the Settlement Amount
for such Settling Bank. All funds advanced by any Bank as a Settling
Bank pursuant to this Section 2.5 shall for all purposes be treated
as a Syndicated Loan made by such Settling Bank to the Borrower and
all funds received by any Bank pursuant to this Section 2.5 shall for
all purposes (other than for purposes of Section 5.10) be treated as
repayment of amounts owed with respect to Loans made by such Bank. In
the event that any bankruptcy, reorganization, liquidation,
receivership or similar cases or proceedings in which the Borrower is
a debtor prevent a Settling Bank from making any Syndicated Loan to
effect a Settlement as contemplated hereby, such Settling Bank will
make such dispositions and arrangements with the other Banks with
respect to such Syndicated Loans, either by way of purchase of
participations, distribution, PRO TANTO assignment of claims,
subrogation or otherwise as shall result in each Bank's share of the
outstanding Syndicated Loans being equal, as nearly as may be, to
such Bank's Commitment Percentage of the outstanding amount of the
Syndicated Loans.
2.5.2. FAILURE TO MAKE FUNDS AVAILABLE. The Agent may,
unless notified to the contrary by any Settling Bank prior to a
Settlement Date, assume that such Settling Bank has made or will make
available to the Agent on such Settlement Date the amount of such
Settling Bank's Settlement Amount, and the Agent may (but it shall
not be required to), in reliance upon such assumption, make available
to the Borrower or other Banks, as applicable, a corresponding
amount. If any Settling Bank makes available to the Agent such amount
on a date after such Settlement Date, such Settling Bank shall pay to
the Agent on demand an amount equal to the product of (i) the average
computed for the period referred to in clause (iii) below, of the
weighted average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period, times
(ii) the amount of such Settlement Amount,
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times (iii) a fraction, the numerator of which is the number of days
that elapse from and including such Settlement Date to the date on
which the amount of such Settlement Amount shall become immediately
available to the Agent, and the denominator of which is 360. A
statement of the Agent submitted to such Settling Bank with respect
to any amounts owing under this Section 2.5.2 shall be prima facie
evidence of the amount due and owing to the Agent by such Settling
Bank. If such Settling Bank's Settlement Amount is not made available
to the Agent by such Settling Bank within three (3) Business Days
following such Settlement Date, the Agent shall be entitled to recover
such amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Syndicated Loans (or Competitive Bid
Loans, as applicable) for which such Settlement Amount was not made
available to the Agent; PROVIDED, HOWEVER, that until and unless such
payment has been made in full by the Borrower, such Bank shall remain
liable to the Agent for the full amount of such payment, including
interest as set forth above. Subject to Section 2.1 and Section 2.3, as
applicable, the Borrower may at any time within such three-day period
submit a new Loan Request or Competitive Bid Quote Request to the Agent
pursuant to Section 2.2 or Section 2.3.1(b), as applicable, covering
the amount set forth in the Agent's demand for payment. Any payment by
the Borrower to the Agent of any Syndicated Loans (or Competitive Bid
Loans) pursuant to this Section 2.5.2 shall be deemed to be a payment
of the Loans that were to be made by the Settling Bank that failed to
make its Settlement Amount available to the Agent.
2.5.3. NO EFFECT ON OTHER BANKS. The failure or refusal of any
Settling Bank to make available to the Agent at the aforesaid time and
place on any Settlement Date the amount of such Settling Bank's
Settlement Amount shall not (i) relieve any other Settling Bank from
its several obligations hereunder to make available to the Agent the
amount of such other Settling Bank's Settlement Amount or (ii) impose
upon any Bank, other than the Settling Bank so failing or refusing, any
liability with respect to such failure or refusal or otherwise increase
the Commitment of such other Bank.
2.6. THE NOTES.
2.6.1. SYNDICATED NOTES. The Syndicated Loans shall be
evidenced by separate promissory notes of the Borrower in substantially
the form of EXHIBIT E-1 attached hereto (each a "SYNDICATED NOTE"),
dated as of the Closing Date and completed with appropriate insertions.
A Syndicated Note shall be payable to the order of each Bank in a
principal amount equal to such Bank's Commitment or, if less, the
outstanding amount of all Syndicated Loans made by such Bank, plus
interest accrued thereon, as set forth below. The Borrower irrevocably
authorizes each Bank to make, at or about the time of the Drawdown Date
of any Syndicated Loan or at the time of receipt of any payment of
principal on such Bank's Syndicated Note, an appropriate notation on
the Record
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attached to such Bank's Syndicated Note reflecting the making of such
Syndicated Loan or (as the case may be) the receipt of such payment.
The outstanding amount of the Syndicated Loans set forth on such Bank's
Record shall be PRIMA FACIE evidence of the principal amount thereof
owing and unpaid to such Bank, but the failure to record, or any error
in so recording, any such amount on such Bank's Record shall not limit
or otherwise affect the obligations of the Borrower hereunder or under
any Syndicated Note to make payments of principal of or interest on any
Syndicated Note when due.
2.6.2. COMPETITIVE BID NOTES. The Competitive Bid Loans
shall be evidenced by separate promissory notes of the Borrower in
substantially the form of EXHIBIT E-2 attached hereto (each a
"COMPETITIVE BID NOTE"), dated as of the Closing Date and completed
with appropriate insertions. A Competitive Bid Note shall be payable
to the order of each Bank in a principal amount equal to the Maximum
Competitive Bid Amount, or if less, the outstanding amount of all
Competitive Bid Loans made by such Bank to the Borrower hereunder, as
set forth in Section 2.3, PLUS interest accrued thereon, as set forth
below. The Borrower irrevocably authorizes each Bank to make, at or
about the time of the Drawdown Date of any Competitive Bid Loan made
by such Bank or at the time of receipt of the payment of principal of
such Competitive Bid Loan, an appropriate notation on the Record
attached to such Bank's Competitive Bid Note reflecting the making of
such Competitive Bid Loan and repayments thereof. All such notations
shall constitute PRIMA FACIE evidence of the amount of such
Competitive Bid Loans and the repayments thereof, but the failure to
record, or any error in so recording such amount on such Bank's
Record shall not limit or otherwise affect the obligations of the
Borrower hereunder or under any Competitive Bid Note to make payments
of principal or interest on any Competitive Bid Note when due.
2.7. REDUCTION OF TOTAL COMMITMENT. The Borrower shall have the right
at any time and from time to time upon three (3) Business Days prior written
notice to the Agent to reduce by $1,000,000 or an integral multiple thereof or
terminate entirely the unborrowed portion of the Total Commitment, whereupon
the Commitments of the Banks shall be reduced PRO RATA in accordance with
their respective Commitment Percentages of the amount specified in such notice
or, as the case may be, terminated. Promptly after receiving any notice of the
Borrower delivered pursuant to this Section 2.7, the Agent will notify the
Banks of the substance thereof. Upon the effective date of any such reduction
or termination, the Borrower shall pay to the Agent for the respective
accounts of the Banks the full amount of any facility fee then accrued on the
amount of the reduction. No reduction or termination of the Commitments or of
the Total Commitment may be reinstated.
2.8. INTEREST ON LOANS. Except as otherwise provided in Section 5.11,
the unpaid principal amount of the Loans outstanding from time to time shall
bear
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interest from the Drawdown Date thereof until the Revolving Credit Loan
Maturity Date at the annual rate which at all times shall be determined in
accordance with the following provisions:
(a) Each Base Rate Loan Outstanding shall bear interest for
the period commencing with the Drawdown Date thereof and ending on the
last day of the Interest Period with respect thereto at the Base Rate.
(b) Each Eurodollar Rate Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last
day of the Interest Period with respect thereto at a rate per annum
equal to the sum of the Applicable Margin PLUS the Eurodollar Rate
determined for such Interest Period.
(c) Each Competitive Bid Loan shall bear interest at the rate
per annum specified in the applicable Competitive Bid Quote with
respect to such Competitive Bid Loan.
(d) The Borrower promises to pay interest on each Loan in
arrears on each Interest Payment Date with respect thereto.
2.9. CONVERSION OPTIONS.
2.9.1. CONVERSION TO DIFFERENT TYPE OF SYNDICATED LOAN. The
Borrower may elect from time to time to convert any outstanding
Syndicated Loan to a Syndicated Loan of another Type, PROVIDED that (i)
with respect to any such conversion of a Eurodollar Rate Loan into a
Base Rate Loan, such conversion shall only be made on the last day of
the Interest Period with respect thereto; (ii) with respect to any such
conversion of a Base Rate Loan to a Eurodollar Rate Loan, the Borrower
shall give the Agent by 12:00 noon (Boston time) three (3) Eurodollar
Business Days' prior to the proposed conversion date of such Syndicated
Loan prior written notice of such election and (iii) no Syndicated Loan
may be converted into a Eurodollar Rate Loan when any Default or Event
of Default has occurred and is continuing. On the date on which such
conversion is being made, each Bank shall take such action as is
necessary to transfer its Commitment Percentage of such Syndicated
Loans to its Domestic Lending Office or its Eurodollar Lending Office,
as the case may be. All or any part of the outstanding Syndicated Loans
of any Type may be converted as provided herein, PROVIDED that partial
conversions shall be in an aggregate principal amount of $1,000,000 or
a whole multiple of $100,000 in excess thereof. Each Conversion Request
relating to the conversion of a Syndicated Loan to a Eurodollar Rate
Loan shall be irrevocable by the Borrower.
2.9.2. CONTINUATION OF TYPE OF SYNDICATED LOAN. Any Syndicated
Loan of any Type may be continued as such upon the expiration of an
Interest Period with respect thereto by compliance by the
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Borrower with the notice provisions contained in Section 2.9.1;
PROVIDED that no Eurodollar Rate Loan may be continued as such when
any Default or Event of Default has occurred and is continuing, but
shall be automatically converted to a Base Rate Loan on the last day
of the first Interest Period relating thereto ending during the
continuance of any Default or Event of Default of which the officers
of the Agent active upon the Borrower's account have actual
knowledge. In the event that the Borrower fails to provide any such
notice with respect to the continuation of any Eurodollar Rate Loan
or Base Rate Loan as such, then such Eurodollar Rate Loan shall be
automatically converted to a Base Rate Loan on the last day of the
first Interest Period relating thereto, and such Base Rate Loan shall
be continued as a Base Rate Loan on the last day of the first
Interest Period relating thereto. The Agent shall notify the Banks
promptly when any such automatic conversion or continuation
contemplated by this Section 2.9.2 is scheduled to occur.
2.9.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurodollar Rate Loans having the same Interest
Period shall not be less than $1,000,000 or a whole multiple of
$100,000 in excess thereof. The Borrower may not have more than five
(5) Eurodollar Rate Loans outstanding at any time.
3. REPAYMENT OF THE LOANS.
3.1. MATURITY.
(a) The Borrower promises to pay on the Revolving Credit Loan
Maturity Date, and there shall become absolutely due and payable on the
Revolving Credit Loan Maturity Date, all of the Loans outstanding on
such date, together with any and all accrued and unpaid interest
thereon.
(b) At any time prior to the first anniversary of the Closing
Date, the Borrower may request that the Banks extend the Revolving
Credit Loan Maturity Date by one (1) year (a "REVOLVING CREDIT LOAN
MATURITY EXTENSION"), by delivering to the Agent a request in
substantially the form of EXHIBIT F hereto (a "REVOLVING CREDIT LOAN
MATURITY EXTENSION REQUEST"). Promptly upon receipt of the Revolving
Credit Loan Maturity Extension Request, the Agent shall notify each of
the Banks thereof. The Revolving Credit Loan Maturity Extension shall
be effective ONLY IF on or before thirty (30) days after the first
anniversary of the Closing Date the Agent shall have received a
Revolving Credit Loan Maturity Extension Request signed by the Borrower
and all of the Banks, which Revolving Credit Loan Maturity Extension
Request may be executed in several counterparts by each of the parties
thereto, and each such counterpart shall be effective as an original
executed counterpart. The Banks shall have no obligation to sign a
Revolving Credit Loan Maturity Extension
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Request or in any way approve a Revolving Credit Loan Maturity
Extension.
3.2. MANDATORY REPAYMENTS OF LOANS. If at any time the Total
Outstanding exceeds the Total Commitment, then the Borrower shall immediately
pay the amount of such excess to the Agent for application to the Loans for
the respective accounts of the Banks. Each prepayment of Loans shall be
allocated among the Banks, in proportion, as nearly as practicable to the
respective unpaid principal amount of each Bank's Syndicated Note, with
adjustments to the extent practicable to equalize any prior payments or
repayments not exactly in proportion, and if no Syndicated Loans are
outstanding, the Competitive Bid Loans, in proportion, as nearly as
practicable, to the unpaid principal amount of each Bank's Competitive Bid
Note. If at any time the sum of the outstanding amount of the Competitive Bid
Loans exceeds the Maximum Competitive Bid Amount, then the Borrower shall
immediately pay the amount of such excess to the Agent for application to the
Competitive Bid Loans made by the Banks, in proportion, as nearly as
practicable, to the unpaid principal amount of each Bank's Competitive Bid
Note.
3.3. OPTIONAL REPAYMENTS OF LOANS.
(a) The Borrower shall have the right, at its election, to repay the
outstanding amount of the Loans, as a whole or in part, at any time without
penalty or premium, PROVIDED that all prepayments of Eurodollar Rate Loans
prior to the end of the Interest Period relating thereto shall obligate the
Borrower to pay any breakage costs associated with such Eurodollar Rate Loans
in accordance with Section 5.10. The Borrower shall give the Agent written
notice, no later than 12:00 noon, Boston time, (i) on the Business Day of any
proposed repayment pursuant to this Section 3.3 of Base Rate Loans or
Competitive Bid Loans, and (ii) three (3) Eurodollar Business Days in advance
of any proposed repayment pursuant to this Section 3.3 of Eurodollar Rate
Loans, in each case, specifying the proposed date of payment of such Loans,
the principal amount to be paid and whether the Loan being unpaid is a
Syndicated Loan, Competitive Bid Loan or both. Each such partial prepayment of
the Loans shall be in a minimum amount of $1,000,000 or an integral multiple
of $100,000 in excess thereof, shall be accompanied by the payment of accrued
interest on the principal repaid to the date of payment and shall be applied,
in the absence of instruction by the Borrower, first to the principal of Base
Rate Loans, then to the principal of Eurodollar Rate Loans, and then to the
principal of Competitive Bid Loans. Each partial prepayment shall be allocated
among the Banks, in proportion, as nearly as practicable, to the respective
unpaid principal amount of each Bank's Syndicated Note and Competitive Bid
Note, with adjustments to the extent practicable to equalize any prior
repayments not exactly in proportion.
(b) Notwithstanding the foregoing, subject to the provisions of
Section 2.5, the Agent may, in its sole discretion and without consulting with
the Banks, allow the Borrower to repay Loans (i) from collections received by
the Borrower or (ii) in such other amounts requested by the Borrower.
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4. LETTERS OF CREDIT.
4.1. LETTER OF CREDIT COMMITMENTS.
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by the
Borrower or any of its Subsidiaries of a letter of credit application
on the Issuing Bank's customary form (a "LETTER OF CREDIT
APPLICATION"), the Issuing Bank on behalf of the other Banks and in
reliance upon the agreement of the other Banks set forth in Section
4.1.4 and upon the representations and warranties of the Borrower
contained herein, agrees, in its individual capacity, to issue,
extend and renew for the account of the Borrower or any of its
Subsidiaries one or more standby or documentary letters of credit
(individually, a "Letter of Credit"), in such form as may be
requested from time to time by the Borrower or any of its
Subsidiaries and agreed to by the Issuing Bank; PROVIDED, HOWEVER,
that, after giving effect to such request, (a) the sum of the
aggregate Maximum Drawing Amount and all Unpaid Reimbursement
Obligations shall not exceed $70,000,000 at any one time and (b) the
Total Outstanding shall not exceed the Total Commitment.
4.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Issuing Bank.
In the event that any provision of any Letter of Credit Application
shall be inconsistent with any provision of this Credit Agreement, then
the provisions of this Credit Agreement shall, to the extent of any
such inconsistency, govern.
4.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit
issued, extended or renewed hereunder shall, among other things, (i)
provide for the payment of sight drafts, or time drafts up to a
maximum tenor of 183 days, for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the
documents described therein, and (ii) have an expiry date no later
than the Revolving Credit Loan Maturity Date. Each Letter of Credit
so issued, extended or renewed shall be subject to the Uniform
Customs.
4.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS. Each Bank
severally agrees that it shall be absolutely liable, without regard
to the occurrence of any Default or Event of Default or any other
condition precedent whatsoever, to the extent of such Bank's
Commitment Percentage, to reimburse the Issuing Bank on demand for
the amount of each draft paid by the Issuing Bank under each Letter
of Credit to the extent that such amount is not reimbursed by the
Borrower pursuant to Section 4.2 (such agreement for a Bank being
called herein the "LETTER OF CREDIT PARTICIPATION" of such Bank).
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4.1.5. PARTICIPATIONS OF BANKS. Each such payment made by a
Bank shall be treated as the purchase by such Bank of a participating
interest in the Borrower's Reimbursement Obligation under Section 4.2
in an amount equal to such payment. Each Bank shall share in
accordance with its participating interest in any interest which
accrues pursuant to Section 4.2.
4.1.6. NOTICE TO AGENT. At the time of issuance of each
Letter of Credit, the Issuing Bank shall notify the Agent of Maximum
Drawing Amount of such Letter of Credit and the other terms of such
Letter of Credit.
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Issuing Bank to issue, extend and renew each Letter of Credit and the other
Banks to participate therein, the Borrower hereby agrees to reimburse or pay
to the Agent, for the account of the Issuing Bank or (as the case may be) the
Banks, with respect to each Letter of Credit issued, extended or renewed by
the Issuing Bank hereunder,
(a) except as otherwise expressly provided in Section 4.2(b)
and (c), within one Business Day following each date that any draft
presented under such Letter of Credit is honored by the Issuing Bank
and the Issuing Bank has provided to the Borrower notice pursuant to
Section 4.3 or within one Business Day following any date on which
the Issuing Bank notifies the Borrower that the Issuing Bank has
otherwise made a payment with respect thereto, (i) the amount paid by
the Issuing Bank under or with respect to such Letter of Credit, and
(ii) the amount of any taxes, fees, charges or other reasonable costs
and expenses whatsoever incurred by the Issuing Bank or any other
Bank in connection with any payment made by the Issuing Bank or any
other Bank under, or with respect to, such Letter of Credit, PROVIDED
THAT, unless a Default or Event of Default occurs and is continuing,
failure by the Borrower to make payment as set forth in this Section
4.2(a) shall automatically be deemed to be a Loan Request as provided
by Section 2.2.1 hereto for a Base Rate Loan in the principal amount
of such payment, and with a Drawdown Date as of the date in which
such payment would have been due and payable under this Section
4.2(a).
(b) upon the reduction (but not termination) of the Total
Commitment to an amount less than the Maximum Drawing Amount, an amount
equal to such difference, which amount shall be held by the Agent for
the benefit of the Banks and the Issuing Bank as cash collateral for
all Reimbursement Obligations, and
(c) upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all
Letters of Credit in accordance with Section 13, an amount equal to
the then Maximum Drawing Amount on all Letters of Credit, which
amount shall be held by
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the Agent for the benefit of the Banks and the Issuing Bank as cash
collateral for all Reimbursement Obligations. Upon the termination of
the Total Commitment pursuant to Section 2.7, the Agent agrees, so
long as no Default or Event of Default has occurred and is
continuing, to hold such cash collateral in an interest bearing
account in the name of the Borrower, to pay current interest on such
cash collateral to the Borrower, and upon the payment by the Borrower
of any Reimbursement Obligations or the reduction of the Maximum
Drawing Amount upon the cancellation of any Letter of Credit, the
Agent agrees to return to the Borrower an amount equal to such
payment or reduction together with unpaid interest accrued thereon
through the date of such return.
Each such payment shall be made to the Agent at the Agent's Head Office in
immediately available funds. Interest on any and all amounts remaining unpaid
by the Borrower under this Section 4.2(b) and (c), and Section 4.2.(a) if a
Default or an Event of Default occurs and is continuing, at any time from the
date such amounts become due and payable (whether as stated in this Section
4.2(b) and (c), and Section 4.2(a) if a Default or an Event of Default occurs
and is continuing, by acceleration or otherwise) until payment in full
(whether before or after judgment) shall be payable to the Agent on demand at
the rate specified in Section 5.11 for overdue principal on the Loans.
4.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the Issuing
Bank shall, promptly following its receipt thereof, notify the Borrower and
the Agent of the amount of the draft presented or demand for payment and of
the date when it expects to pay such draft or honor such demand for payment.
If the Borrower fails to reimburse the Agent as provided in Section 4.2 no
later than the Business Day following the date that such draft is paid or
other payment is made by the Issuing Bank, the Issuing Bank may at any time
thereafter notify the other Banks and the Agent of the amount of any such
Unpaid Reimbursement Obligation. No later than 3:00 p.m. (Boston time) on the
Business Day next following the receipt of such notice, each Bank shall make
available to the Agent, at the Agent's Head Office, in immediately available
funds, such Bank's Commitment Percentage of such Unpaid Reimbursement
Obligation, together with an amount equal to the product of (i) the average,
computed for the period referred to in clause (iii) below, of the weighted
average interest rate paid by the Issuing Bank for federal funds acquired by
the Issuing Bank during each day included in such period, TIMES (ii) the
amount equal to such Bank's Commitment Percentage of such Unpaid Reimbursement
Obligation, TIMES (iii) a fraction, the numerator of which is the number of
days that elapse from and including the date the Issuing Bank paid the draft
presented for honor or otherwise made payment to the date on which such Bank's
Commitment Percentage of such Unpaid Reimbursement obligation shall become
immediately available to the Agent, and the denominator of which is 360. The
responsibility of the Issuing Bank to the Borrower and the Banks shall be only
to determine that the documents (including each draft) delivered under
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each Letter of Credit in connection with such presentment shall be in
conformity in all material respects with such Letter of Credit.
4.4. OBLIGATIONS ABSOLUTE. Subject to the provisions of Section 4.5,
the Borrower's obligations under this Section 4 shall be absolute and
unconditional under any and all circumstances, other than as a result of the
gross negligence or willful misconduct of the Issuing Bank, the Agent or the
other Banks, and irrespective of the occurrence of any Default or Event of
Default or any condition precedent whatsoever or any setoff, counterclaim or
defense to payment which the Borrower may have or have had against the Agent,
the Issuing Bank, any other Bank or any beneficiary of a Letter of Credit. The
Borrower further agrees with the Issuing Bank, the Agent and the other Banks
that the Issuing Bank, the Agent and the other Banks shall not be responsible
for, and the Borrower's Reimbursement Obligations under Section 4.2 shall not
be affected by, among other things, the validity or genuineness of documents
or of any endorsements thereon, even if such documents should in fact prove to
be in any or all respects invalid, fraudulent or forged, or any dispute
between or among the Borrower, the beneficiary of any Letter of Credit or any
financing institution or other party to which any Letter of Credit may be
transferred or any claims or defenses whatsoever of the Borrower against the
beneficiary of any Letter of Credit or any such transferee. The Issuing Bank,
the Agent and the other Banks shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit. The
Borrower agrees that any action taken or omitted by the Issuing Bank, the
Agent or any other Bank under or in connection with each Letter of Credit and
the related drafts and documents, if done in good faith, shall be binding upon
the Borrower and shall not result in any liability on the part of the Issuing
Bank, the Agent or any other Bank to the Borrower. The Issuing Bank agrees
that it will exercise and give the same care and attention to each Letter of
Credit as it gives to its other letters of credit.
4.5. RELIANCE BY ISSUER. To the extent not inconsistent with Section
4.4, the Issuing Bank shall be entitled to rely, and shall be fully protected
in relying upon, any Letter of Credit, draft, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex
or teletype message, statement, order or other document believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Issuing Bank. The Agent shall be
fully justified in failing or refusing to take any action under this Credit
Agreement unless it shall first have received such advice or concurrence of
the Majority Banks as it reasonably deems appropriate or it shall first be
indemnified to its reasonable satisfaction by the other Banks against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Issuing Bank shall in all cases be
fully protected in acting, or in refraining from acting, under this Credit
Agreement in accordance with a request of the Majority Banks, and such request
and any action taken or failure to act
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pursuant thereto shall be binding upon the Banks and all future holders of the
Notes or of a Letter of Credit Participation.
4.6. LETTER OF CREDIT FEE. The Borrower shall pay to the Agent a fee
(in each case, a "Letter of Credit Fee") (a) in respect of each standby Letter
of Credit issued pursuant to this Credit Agreement, equal to the Applicable
Margin specified for such standby Letter of Credit at the date of issuance,
extension or renewal of such Letter of Credit multiplied by the face amount of
each such Letter of Credit, PLUS an issuance fee in respect of each standby
Letter of Credit equal to an amount agreed by between the Borrower and the
Issuing Bank, for the account of the Issuing Bank only, (the "STANDBY FRONTING
FEE"), and the Agent shall in turn remit to each Bank its PRO RATA portion of
such Letter of Credit Fee (but not the Standby Fronting Fee, which is for the
account of the Issuing Bank only) and (b) in respect of each documentary
Letter of Credit issued pursuant to this Credit Agreement, equal to the
Applicable Margin specified for such documentary Letter of Credit at the date
of issuance, extension or renewal of such Letter of Credit multiplied by the
face amount of each such Letter of Credit or any subsequent increases in the
face amount, PLUS the Applicable Margin PLUS an issuance fee in respect of
each documentary Letter of Credit equal to $125.00 (the "DOCUMENTARY FRONTING
FEE"), and the Agent shall in turn remit to each Bank its PRO RATA portion of
such Letter of Credit Fee (but not the Documentary Fronting Fee, which is for
the account of the Issuing Bank only). The Letter of Credit Fee for each
Letter of Credit shall be payable quarterly in arrears on the first day of
each calendar quarter for the immediately preceding calendar quarter
commencing on the first such date following the Closing Date with a final
payment on the Revolving Credit Maturity Date or an earlier date on which the
Commitment shall terminate, in each case to be first preceded by a notice and
invoice from the Agent specifying the amount due and payable. In addition, the
Borrower shall pay to the Issuing Bank, for its own account, such other
issuance, processing, negotiation, amendment and administrative fees as the
Issuing Bank may customarily require.
5. CERTAIN GENERAL PROVISIONS.
5.1. CERTAIN FEES.
5.1.1. FEES PAYABLE AT CLOSING. The Borrower agrees to pay all
fees referred to in the Fee Letter which are payable on the Closing
Date in accordance with the terms of such Fee Letter.
5.1.2. AGENT AND ARRANGER FEES. The Borrower agrees to pay
each of the Agent and the Arranger the fees described in the Fee
Letter, upon the terms and conditions set forth therein.
5.2. FACILITY FEE. The Borrower agrees to pay to the Agent for the
accounts of the Banks in accordance with their respective Commitment
Percentages a facility fee calculated at the rate of the Applicable Margin
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specified for such facility fee on the average daily amount during each
calendar quarter or portion thereof from the Closing Date to the Revolving
Credit Loan Maturity Date of the Total Commitment during such calendar
quarter. The facility fee shall be payable quarterly in arrears on the first
day of each calendar quarter for the immediately preceding calendar quarter
commencing on the first such date following the Closing Date with a final
payment on the Revolving Credit Maturity Date or any earlier date on which the
Commitment shall terminate, in each case to be first preceded by a notice and
invoice from the Agent specifying the amount due and payable.
5.3. UTILIZATION FEE. The Borrower agrees to pay to the Agent, for
the account of the Banks in accordance with their respective Commitment
Percentages, a fee (the "UTILIZATION FEE") equal to one eighth percent
(0.125%) per annum of the Total Outstanding for each day in which the Total
Outstanding (excluding the Maximum Drawing Amount and Unpaid Reimbursement
Obligations) exceeds fifty percent (50%) of the Total Commitment. To the
extent any Utilization Fee is payable pursuant to this Section 5.3, the
Utilization Fee shall be payable quarterly in arrears on the first day of each
calendar quarter for the immediately preceding calendar quarter, commencing on
the first such date following the Closing Date with a final payment on the
Revolving Credit Maturity Date or any earlier date on which the Commitment
shall terminate, in each case to be first preceded by a notice and invoice
from the Agent specifying the amount due and payable.
5.4. FUNDS FOR PAYMENTS.
5.4.1. PAYMENTS TO AGENT. All payments of principal, interest,
Reimbursement Obligations, facility fees, Letter of Credit Fees and any
other fees due hereunder or under any of the other Loan Documents shall
be made to the Agent, for the respective accounts of the Banks, the
Issuing Bank and the Agent, as applicable, at the Agent's Head Office
or at such other location in the Boston, Massachusetts, area that the
Agent may from time to time designate, in each case in immediately
available funds.
5.4.2. NO OFFSET, ETC. All payments by the Borrower
hereunder and under any of the other Loan Documents shall be made
without setoff or counterclaim and free and clear of and without
deduction for any taxes, levies, imposts, duties, charges, fees,
deductions, withholdings, compulsory loans, restrictions or
conditions of any nature now or hereafter imposed or levied by any
jurisdiction or any political subdivision thereof or taxing or other
authority therein unless the Borrower is compelled by law to make
such deduction or withholding. If any such obligation is imposed upon
the Borrower with respect to any amount payable by it hereunder or
under any of the other Loan Documents, the Borrower will pay to the
Agent, for the account of the Banks, the Issuing Bank or the Agent,
as the case may be, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such
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additional amount in Dollars as shall be necessary to enable the
Banks or the Agent to receive the same net amount which the Banks or
the Agent would have received on such due date had no such obligation
been imposed upon the Borrower. The Borrower will deliver promptly to
the Agent certificates or other valid vouchers for all taxes or other
charges deducted from or paid with respect to payments made by the
Borrower hereunder or under such other Loan Document. Nothing
contained in this Section 5.3.2 shall be deemed to impose upon the
Borrower any obligation to pay taxes based upon the income or profits
of the Agent, the Issuing Bank or any other Bank.
5.5. COMPUTATIONS. All computations of interest on the Eurodollar
Rate Loans shall be based on a 360-day year and paid for the actual number of
days elapsed. All computations of interest on Base Rate Loans, Competitive Bid
Loans, Letter of Credit Fees, and other fees due hereunder shall be based on a
365-day year and paid for the actual number of days elapsed. Except as
otherwise provided in the definition of the term "Interest Period" with
respect to Eurodollar Rate Loans, whenever a payment hereunder or under any of
the other Loan Documents becomes due on a day that is not a Business Day, the
due date for such payment shall be extended to the next succeeding Business
Day, and interest shall accrue during such extension. The outstanding amount
of the Loans as reflected on the Records from time to time shall be considered
correct and binding on the Borrower unless within five (5) Business Days after
receipt of any notice by the Agent or any of the Banks of such outstanding
amount to the Borrower, the Borrower shall notify the Agent or such Bank to
the contrary.
5.6. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to
the commencement of any Interest Period relating to any Eurodollar Rate Loan,
the Agent shall determine or be notified by the Majority Banks that adequate
and reasonable methods do not exist for ascertaining the Eurodollar Rate that
would otherwise determine the rate of interest to be applicable to any
Eurodollar Rate Loan during any Interest Period, the Agent shall forthwith
give notice of such determination (which shall be conclusive and binding on
the Borrower and the Banks) to the Borrower and the Banks. In such event (i)
any Loan Request or Conversion Request with respect to Eurodollar Rate Loans
shall be automatically withdrawn and shall be deemed a request for Base Rate
Loans, (ii) each Eurodollar Rate Loan will automatically, on the last day of
the then current Interest Period relating thereto, become a Base Rate Loan
unless the Agent has received timely notice of the Borrower's intent to prepay
such Eurodollar Rate Loan or any portion thereof pursuant to Section 3.3, and
(iii) the obligations of the Banks to make Eurodollar Rate Loans shall be
suspended until the Agent or the Majority Banks determine that the
circumstances giving rise to such suspension no longer exist, whereupon the
Agent or, as the case may be, the Agent upon the instruction of the Majority
Banks, shall so notify the Borrower and the Banks.
5.7. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the
interpretation or
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application thereof shall make it unlawful for any Bank to make or maintain
Eurodollar Rate Loans, such Bank shall forthwith give notice of such
circumstances to the Borrower and the other Banks and thereupon (i) the
commitment of such Bank to make Eurodollar Rate Loans or convert Base Rate
Loans to Eurodollar Rate Loans shall forthwith be suspended and (ii) such
Bank's Syndicated Loans then outstanding as Eurodollar Rate Loans, if any,
shall be converted automatically to Base Rate Loans on the last day of each
Interest Period applicable to such Eurodollar Rate Loans unless the Agent has
received timely notice of the Borrower's intent to prepay such Eurodollar Rate
Loan or any portion thereof pursuant to Section 3.3, or within such earlier
period as may be required by law. The Borrower hereby agrees to pay the Agent
for the account of such Bank, within thirty (30) days following demand by such
Bank, any additional amounts necessary to compensate such Bank for any costs
incurred by such Bank in making any conversion in accordance with this Section
5.6, including any interest or fees payable by such Bank to lenders of funds
obtained by it in order to make or maintain its Eurodollar Rate Loans
hereunder; PROVIDED, HOWEVER, that if the Agent or such Bank shall fail to
notify the Borrower or make demand within one hundred twenty (120) days
following the occurrence of any such event, such Bank shall not be entitled to
claim any additional amounts pursuant to this Section 5.6 for any period
ending on a date which is prior to one hundred twenty (120) days before such
notification or demand.
5.8. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Bank or the Agent by any central bank or other
fiscal, monetary or other authority (whether or not having the force of law),
shall:
(a) subject any Bank or the Agent to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect
to this Credit Agreement, the other Loan Documents, any Letters of
Credit, such Bank's Commitment or the Loans (other than taxes based
upon or measured by the income or profits of such Bank or the Agent),
or
(b) materially change the basis of taxation (except for
changes in taxes on income or profits) of payments to any Bank of the
principal of or the interest on any Loans or any other amounts payable
to any Bank or the Agent under this Credit Agreement or any of the
other Loan Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement)
any special deposit, reserve, assessment, liquidity, capital adequacy
or other similar requirements (whether or not having the force of law)
against
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assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Loans, such Bank's Commitment, or
any class of loans, letters of credit or commitments of which any of
the Loans or such Bank's Commitment forms a part, and the result of any
of the foregoing is
(i) to increase the cost to any Bank of making,
funding, issuing, renewing, extending or maintaining any of
the Loans or such Bank's Commitment or any Letter of Credit,
or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Bank
or the Agent hereunder on account of such Bank's Commitment,
any Letter of Credit or any of the Loans, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or Reimbursement Obligation
or other sum payable hereunder, the amount of which payment or
foregone interest or Reimbursement Obligation or other sum is
calculated by reference to the gross amount of any sum
receivable or deemed received by such Bank or the Agent from
the Borrower hereunder,
then, and in each such case, the Borrower will, within thirty (30) days
following demand made by such Bank or (as the case may be) the Agent at any
time and from time to time and as often as the occasion therefor may arise,
pay to such Bank or the Agent such additional amounts as will be sufficient to
compensate such Bank or the Agent for such additional cost, reduction, payment
or foregone interest or Reimbursement Obligation or other sum; PROVIDED,
HOWEVER, that if such Bank or the Agent shall fail to notify the Borrower or
make demand within one hundred twenty (120) days following the occurrence of
any such event, such Bank or, as the case may be, the Agent shall not be
entitled to claim any additional amounts pursuant to this Section 5.7 for any
period ending on a date which is prior to one hundred (120) days before such
notification or demand.
5.9. CAPITAL ADEQUACY. If after the date hereof any Bank or the Agent
reasonably determines that (i) the adoption of or change in any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) regarding capital requirements for banks or bank
holding companies or any change in the interpretation or application thereof
by a court or governmental authority with appropriate jurisdiction after the
date hereof, or (ii) compliance after the date hereof by such Bank or the
Agent or any corporation controlling such Bank or the Agent with any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law)
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of any such entity regarding capital adequacy, has the effect of reducing the
return on such Bank's or the Agent's commitment with respect to any Loans to a
level below that which such Bank or the Agent could have achieved but for such
adoption, change or compliance (taking into consideration such Bank's or the
Agent's then existing policies with respect to capital adequacy and assuming
full utilization of such entity's capital) by any amount deemed by such Bank
or (as the case may be) the Agent to be material, then such Bank or the Agent
may notify the Borrower of such fact. To the extent that the amount of such
reduction in the return on capital is not reflected in the Base Rate or
Eurodollar Rate, or in amounts paid or payable by the Borrower pursuant to
Section 5.7 or Section 5.10 hereof, the Borrower and such Bank or (as the case
may be) the Agent shall thereafter attempt to negotiate in good faith, within
thirty (30) days of the day on which the Borrower receives such notice, an
adjustment payable hereunder which will adequately compensate such Bank or the
Agent in light of these circumstances. If the Borrower and such Bank or the
Agent are unable to agree to such adjustment within thirty (30) days of the
date on which the Borrower receives such notice, then commencing on the date
of such notice (but not earlier than the effective date of any such increased
capital requirement), the fees payable hereunder shall increase by an amount
that will, in such Bank's or the Agent's reasonable determination, provide
adequate compensation. Each Bank and the Agent shall allocate such cost
increases among its customers in good faith and on an equitable basis.
Notwithstanding anything to the contrary contained in this Section 5.8,
in the event that the Agent or any Bank shall fail to notify the Borrower
of any such costs of increased capital requirements within one hundred twenty
(120) days following the Agent's or such Bank's determination thereof, the
Agent or, as the case may be, such Bank shall not be entitled to claim any
additional amounts pursuant to this Section 5.8 for any period ending on a date
which is prior to one hundred twenty (120) days before such notification.
5.10. CERTIFICATE. A certificate signed by an officer of any Bank,
setting forth any additional amount required to be paid by the Borrower to
such Bank under Section 5.7, Section 5.8 or Section 5.10 and the computations
made by such Bank to determine such additional amount, shall be submitted by
such Bank to the Borrower in connection with each demand made at any time by
such Bank upon the Borrower under Section 5.7, Section 5.8 or Section 5.10.
Without limiting the negotiation requirements of Section 5.8 (with respect to
certificates issued on account of additional amounts required to be paid
pursuant to Section 5.8), such certificate shall constitute PRIMA FACIE
evidence as to the additional amount owed.
5.11. INDEMNITY. The Borrower agrees to indemnify each Bank and to
hold each Bank harmless from and against any loss, cost or expense (including
loss of anticipated profits) that such Bank may sustain or incur as a
consequence of (i) default by the Borrower in payment of the principal amount
of or any interest on any Eurodollar Rate Loans or Competitive Bid Rate Loans
as and when due and payable, including any such loss or expense arising from
interest or fees payable by such Bank to lenders of funds obtained by it in
order to maintain its Eurodollar Rate Loans or Competitive Bid Rate Loans,
(ii) default
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by the Borrower in making a borrowing or conversion after the Borrower has
given (or is deemed to have given) a Loan Request or a Conversion Request
relating thereto in accordance with Section 2.2 or Section 2.9 or after the
Borrower has accepted a Competitive Bid Quote pursuant to Section 2.3.1(f)
or (iii) the making of any payment of a Eurodollar Rate Loan or Competitive
Bid Rate Loan or the making of any conversion of any such Eurodollar Rate
Loan to a Base Rate Loan on a day that is not the last day of the applicable
Interest Period with respect thereto, including interest or fees payable by
such Bank to lenders of funds obtained by it in order to maintain any such
Loans. In the event that the Agent or any Bank shall fail to notify the
Borrower of any such losses, costs or expenses within one hundred twenty (120)
days following the incurrence of any thereof, the Agent or, as the case may be,
such Bank shall not be entitled to claim any additional amounts pursuant to
this Section 5.10 for any period ending on a date which is prior to one
hundred twenty (120) days before such notification.
5.12. INTEREST AFTER DEFAULT.
5.12.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other
overdue amounts payable hereunder or under any of the other Loan
Documents shall bear interest compounded monthly and payable on demand
at a rate per annum equal to two percent (2%) above the rate of
interest otherwise applicable to such Loans pursuant to Section 2.8.
5.12.2. AMOUNTS NOT OVERDUE. During the continuance of an
Event of Default the principal of the Loans not overdue shall, until
such Event of Default has been cured or remedied or such Event of
Default has been waived by the Majority Banks pursuant to Section 26,
bear interest at a rate per annum equal to two percent (2%) above the
rate of interest otherwise applicable to such Loans pursuant to
Section 2.8.
5.13. BANK OBLIGATION TO MITIGATE. Any Bank that makes demand for
payment of additional amounts under Section 5.7 or Section 5.8 or notifies the
Agent of any circumstances pursuant to Section 5.6, shall use reasonable
efforts (consistent with its internal policies and legal and regulatory
restrictions) to change the jurisdiction of its applicable lending office so
as to avoid thereafter the circumstances that give rise to such demand or
notification.
5.14. REPLACEMENT OF BANK. (a) In the event that any Bank makes a
demand for payment under Section 5.7 or Section 5.8 or notifies the Agent of
any circumstances requiring payment pursuant to Section 5.6, the Borrower may
within one hundred twenty (120) days of such demand, if no Event of Default or
Default then exists, (i) reduce the commitment in the full amount of such
Bank's Commitment Percentage of the Commitment and repay such Bank in full or
(ii) replace such Bank with an Eligible Assignee in accordance with Section 19
(including execution of an appropriate Assignment and Acceptance Agreement).
If the Borrower accomplishes the replacement or repayment of such Bank within
120 days following the demand, the Borrower shall only owe any such Bank
amounts
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under Section 5.6, Section 5.7 or Section 5.8, as applicable, hereof through
the date of replacement or repayment. If the Borrower does not accomplish
either replacement or repayment of such Bank within such 120 days, the
Borrower shall owe such Bank in accordance with the terms of any written
agreement reached between Bank and the Borrower, and, if no such agreement has
been reached, the Borrower shall owe such Bank in accordance with the terms
and provisions of Section 5.6, Section 5.7 or Section 5.8, as applicable. If
the Commitment is reduced by the Borrower pursuant to this Section 5.14(a),
the Borrower and the Banks agree that the Commitment Percentages of each Bank
will be automatically ratably adjusted to reflect such reduction of the
Commitment. Each Bank agrees to the automatic readjustment of each remaining
Bank's contingent liabilities under Section 4.1.4 according to the new
(adjusted) Commitment Percentages.
(b) If any Bank is acquired by or merges with any other Person
(including any other Bank) and (i) such Bank is not the surviving Person, and
(ii) there exists no Default or Event of Default hereunder, the Borrower may
replace such Bank in whole with another Eligible Assignee reasonably
acceptable to the Agent pursuant to an Assignment and Acceptance Agreement
within thirty days following the date of consummation of any such acquisition.
(c) If (i) there exists no Default or Event of Default on any such
date and no Default or Event of Default shall be caused by the action
permitted below and (ii) any Bank refuses to consent to any amendment, waiver
or consent to any provision hereof or in any Loan Document in accordance with
the terms of Section 26 (other than an amendment to increase the Commitment of
such Bank), but to which each other Bank has previously agreed, then, the
Borrower may, with the prior written consent of the Agent, within 90 days
after the date of such consent, amendment or waiver, replace such Bank in
whole with another Eligible Assignee, pursuant to an Assignment and Acceptance
Agreement and otherwise in accordance with the terms of Section 19.
6. GUARANTIES.
The payment and performance of the Obligations shall be guaranteed by
each new United States Subsidiary of the Borrower which becomes a party to a
Guaranty pursuant to Section 9.11.
7. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Banks and the Agent as
follows:
7.1. AUTHORITY.
7.1.1. ORGANIZATION; GOOD STANDING. Each of the Borrower and
its Subsidiaries (i) is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, (ii) has
all requisite power to own its property and conduct its business as
now conducted, and (iii) is in good standing and is duly authorized
to do business in each
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jurisdiction where the character of its properties or the nature of
the business conducted by it make such qualification necessary,
except where (A) a failure to be so qualified would not have a
materially adverse effect on the business, assets or financial
condition of the Borrower and its Subsidiaries taken as a whole or
(B)(1) a failure to be so qualified involves a Subsidiary of the
Borrower that was acquired pursuant to Section 9.6 within thirty (30)
days prior to the date on and as of which this representation and
warranty is being made or repeated and (2) the Borrower and such
Subsidiary are using all reasonable efforts to obtain the appropriate
license, admission or qualification.
7.1.2. AUTHORIZATION. The execution, delivery and
performance of this Credit Agreement and the other Loan Documents to
which the Borrower or any of its Subsidiaries is or is to become a
party and the transactions contemplated hereby and thereby (i) are
within the authority of such Person, (ii) have been duly authorized
by all necessary proceedings (except that in the case of a Subsidiary
acquired pursuant to Section 9.6, such execution, delivery and
authorization shall have been completed no later than the later to
occur of (a) the date of such acquisition, and (b) fifteen (15)
Business Days following receipt by the Borrower or such Subsidiary of
forms of the Loan Documents, or amendments thereto, as appropriate,
to which such Subsidiary is to become a party in order to become a
Subsidiary), (iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to
which the Borrower or any of its Subsidiaries is subject or any
judgment, order, writ, injunction, license or permit applicable to
the Borrower or any of its Subsidiaries, except where such conflict,
breach or contravention would not have a material adverse effect on
the business, assets or financial condition of the Borrower and its
Subsidiaries taken as a whole and would not limit the enforceability
of the Loan Documents or the ability of the Borrower and its
Subsidiaries to perform their obligations under the Loan Documents,
and (iv) do not conflict with any provision of the corporate charter
or bylaws of the Borrower or any of its Subsidiaries and (v) do not
conflict with any material provision or any agreement or other
instrument binding upon, the Borrower or any of its Subsidiaries,
except where such conflict would not have a material adverse effect
on the business, assets or financial condition of the Borrower and
its Subsidiaries taken as a whole.
7.1.3. ENFORCEABILITY. The execution and delivery of this
Credit Agreement and the other Loan Documents to which the Borrower
or any of its Subsidiaries is or is to become a party will result in
valid and legally binding obligations of such Person enforceable
against it in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting generally the enforcement of creditors'
rights and except to the extent that availability of the remedy of
specific performance or injunctive relief
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is subject to the discretion of the court before which any proceeding
therefor may be brought.
7.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance
by the Borrower and any of its Subsidiaries of this Credit Agreement and the
other Loan Documents to which the Borrower or any of its Subsidiaries is or is
to become a party do not require the approval or consent of, or filing with,
any governmental agency or authority other than those already obtained.
7.3. TITLE TO PROPERTIES; LEASES. Except as indicated on SCHEDULE 7.3
hereto, the Borrower and its Subsidiaries own or lease all of the assets
reflected in the consolidated balance sheet of the Borrower and its
Subsidiaries as at the Balance Sheet Date or acquired since that date (except
property and assets sold or otherwise disposed of in the ordinary course of
business or dispositions permitted hereunder since that date), subject to no
liens or other encumbrances except Permitted Liens.
7.4. FINANCIAL STATEMENTS.
7.4.1. FISCAL YEAR. The Borrower and each of its Subsidiaries
has a fiscal year which is the fifty-two/fifty-three weeks ending on
the Saturday closest to the last day of January.
7.4.2. FINANCIAL STATEMENTS. There has been furnished to the
Agent a consolidated balance sheet of the Borrower and its Subsidiaries
as at the Balance Sheet Date, and a consolidated statement of income of
the Borrower and its Subsidiaries for the fiscal year then ended
(collectively, the "Draft 2001 Financials"). Such balance sheet and
statement of income and statement of cash flow have been prepared in
accordance with generally accepted accounting principles and fairly
present the financial condition of the Borrower as at the close of
business on the date thereof and the results of operations for the
fiscal year then ended. There are no contingent liabilities of the
Borrower or any of its Subsidiaries as of such date involving material
amounts, known to the Borrower, which were not disclosed in such
balance sheet and the notes related thereto. The consolidated balance
sheet of the Borrower and its Subsidiaries as at the Balance Sheet
Date, and a consolidated statement of income of the Borrower and its
Subsidiaries for the fiscal year then ended delivered pursuant to
Section 8.4(a) shall not differ from the Draft 2001 Financials in any
material respect.
7.4.3. PROJECTIONS. The projections of the annual operating
budgets of the Borrower and its Subsidiaries on a consolidated basis,
balance sheets and cash flow statements for period from the Closing
Date through the Borrower's fiscal year 2004, copies of which have been
delivered to the Agent, disclose all material assumptions made with
respect to general economic, financial and market conditions used in
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formulating such projections. To the knowledge of the Borrower or its
Subsidiaries, no facts exist that (individually or in the aggregate)
would result in any material adverse change in any of such projections,
as such projections may be updated from time to time pursuant to
Section 8.4(f). The projections are based upon estimates and
assumptions which the Borrower deems reasonable, have been prepared
on the basis of the assumptions stated therein and reflect the good
faith estimates of the Borrower and its Subsidiaries of the results
of operations and other information projected therein.
7.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date there has
occurred no materially adverse change in the financial condition or business
of the Borrower and its Subsidiaries taken as a whole as shown on or reflected
in the consolidated balance sheet of the Borrower and its Subsidiaries as at
the Balance Sheet Date, or the consolidated statement of income for the fiscal
year then ended, other than changes in the ordinary course of business that
have not had any materially adverse effect either individually or in the
aggregate on the business or financial condition of the Borrower and its
Subsidiaries, taken as a whole. Since the Balance Sheet Date, the Borrower has
not made any Distribution, other than as permitted under Section 9.4.
7.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Borrower and
its Subsidiaries possesses all franchises, patents, copyrights, trademarks,
trade names, licenses and permits, and rights in respect of the foregoing,
adequate for the conduct of its business substantially as now conducted
without known conflict with any rights of others, except where (A) a failure
to possess such property and rights in respect thereof would not have a
materially adverse effect on the business, assets or financial condition of
the Borrower and its Subsidiaries taken as a whole or (B)(1) a failure to
possess such property and rights in respect thereof involves a Subsidiary of
the Borrower that was acquired pursuant to Section 9.6 within thirty (30) days
prior to the date on and as of which this representation and warranty is being
made or repeated and (2) the Borrower and such Subsidiary are using all
reasonable efforts to obtain such property and rights in respect thereof.
7.7. LITIGATION. Except as set forth in SCHEDULE 7.7 hereto, there
are no actions, suits, proceedings or investigations of any kind pending or,
to the knowledge of the Borrower, threatened against the Borrower or any of
its Subsidiaries before any court, tribunal or administrative agency or board
that, if adversely determined, might, either in any case or in the aggregate,
materially adversely affect the properties, assets, financial condition or
business of the Borrower and its Subsidiaries taken as a whole or materially
impair the right of the Borrower and its Subsidiaries, considered as a whole,
to carry on business substantially as now conducted by them, or which question
the validity of this Credit Agreement or any of the other Loan Documents, or
any action taken or to be taken pursuant hereto or thereto.
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7.8. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the
Borrower nor any of its Subsidiaries is in violation of any material provision
of its charter documents, bylaws, or any agreement or instrument to which it
may be subject or by which it or any of its properties may be bound or any
decree, order, judgment, statute, license, rule or regulation, in any of the
foregoing cases in a manner that could reasonably be expected to result in a
material adverse effect on the financial condition, assets or business of the
Borrower and its Subsidiaries taken as a whole.
7.9. TAX STATUS. Each of the Borrower and, to the knowledge of the
Borrower, its Subsidiaries (i) have made or filed all United States federal
and state income and other tax returns, reports and declarations required to
be filed by it other than those returns as to which the failure to so file
would not, in the opinion of the Borrower, create an outstanding liability for
taxes due or interest and penalties thereon which would reasonably be expected
materially adversely to affect the operations or the financial condition of
the Borrower and its Subsidiaries, considered as a whole, to carry on business
substantially as now conducted by them or to result in any material liability
for which adequate reserves are not maintained on the consolidated balance
sheet of the Borrower and its Subsidiaries, and (ii) has paid, or has made
reasonable provision for payment of, all taxes and other governmental
assessments and charges shown or determined to be due on such returns, reports
and declarations, except those taxes being contested in good faith and by
appropriate proceedings.
7.10. NO EVENT OF DEFAULT. No Default or Event of Default has
occurred and is continuing.
7.11. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company", as
such terms are defined in the Public Utility Holding Company Act of 1935; nor
is it an "investment company", or a company "controlled" by an "investment
company", as such terms are defined in the Investment Company Act of 1940.
7.12. EMPLOYEE BENEFIT PLANS.
7.12.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance
in all material respects with the provisions of ERISA and all
applicable pension legislation and, to the extent applicable, the Code,
including but not limited to the provisions thereunder respecting
prohibited transactions and the bonding of fiduciaries and other
persons handling plan funds as required by Section 412 of ERISA, except
where such noncompliance would not have a material adverse effect on
the business, assets or financial condition of the Borrower and its
Subsidiaries taken as a whole.
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7.12.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit
Plan, which is an employee welfare benefit plan within the meaning of
Section 3(1) or Section 3(2)(B) of ERISA, provides benefit coverage
subsequent to termination of employment, except as required by Title
I, Part 6 of ERISA or the applicable state insurance laws and except
individual employment, severance or termination agreements with
employees, directors, officers or independent contractors of the
Borrower or any ERISA Affiliate. Subject to the foregoing employment,
severance and termination agreements and applicable legal
requirements, the Borrower or an ERISA Affiliate, as appropriate may
terminate each such Plan at any time (or at any time subsequent to
the expiration of any applicable bargaining agreement) in the
discretion of the Borrower or such ERISA Affiliate without liability
to any Person other than for claims arising prior to termination.
7.12.3. GUARANTEED PENSION PLANS. Each contribution required
to be made to avoid the incurrence of an accumulated funding
deficiency or the notice or lien provisions of Section 302(f) of
ERISA has been timely made. No waiver of an accumulated funding
deficiency or extension of amortization periods has been received
with respect to any Guaranteed Pension Plan, and neither the Borrower
nor any ERISA Affiliate is obligated to or has posted security in
connection with an amendment to a Guaranteed Pension Plan pursuant to
Section 307 of ERISA or Section 401(a)(29) of the Code. As of the
Closing Date, no liability to the PBGC (other than required insurance
premiums, all of which have been paid) has been incurred by the
Borrower or any ERISA Affiliate with respect to any Guaranteed
Pension Plan and there has not been any ERISA Reportable Event (other
than an ERISA Reportable Event as to which the requirement of 30 days
notice has been waived), or any other event or condition which
presents a material risk of termination of any Guaranteed Pension
Plan by the PBGC. Based on the latest valuation of each Guaranteed
Pension Plan, and on the actuarial methods and assumptions employed
for that valuation, the aggregate benefit liabilities of all such
Guaranteed Pension Plans within the meaning of Section 4001 of ERISA
did not exceed the aggregate value of the assets of all such
Guaranteed Pension Plans, disregarding for this purpose the benefit
liabilities and assets of any Guaranteed Pension Plan with assets in
excess of benefit liabilities, by an amount in excess of $5,000,000.
7.12.4. MULTIEMPLOYER PLANS. Neither the Borrower nor any
ERISA Affiliate has incurred any material liability (including
secondary liability) to any Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan under
Section 4201 of ERISA or as a result of a sale of assets described in
Section 4204 of ERISA. Neither the Borrower nor any ERISA Affiliate
has been notified that any Multiemployer Plan is in reorganization or
insolvent under and within the meaning of Section 4241 or Section
4245 of ERISA or is at risk of entering
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reorganization or becoming insolvent, or that any Multiemployer Plan
intends to terminate or has been terminated under Section 4041A of
ERISA.
7.13. USE OF PROCEEDS.
7.13.1. GENERAL. The proceeds of the Loans and the Letters of
Credit shall be used for working capital and general corporate
purposes, including stock and bond repurchases to the extent permitted
under this Agreement.
7.13.2. REGULATIONS U AND X. No portion of any Loan is to be
used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any "margin security" or "margin
stock" as such terms are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
7.13.3. INELIGIBLE SECURITIES. No portion of the proceeds of
any Loan is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of (a) knowingly purchasing, or providing
credit support for the purchase of, Ineligible Securities from a
Section 20 Subsidiary during any period in which such Section 20
Subsidiary makes a market in such Ineligible Securities, (b) knowingly
purchasing, or providing credit support for the purchase of, during the
underwriting or placement period, any Ineligible Securities being
underwritten or privately placed by a Section 20 Subsidiary, or (c)
making, or providing credit support for the making of, payments of
principal or interest on Ineligible Securities underwritten or
privately placed by a Section 20 Subsidiary and issued by or for the
benefit of the Borrower or any Subsidiary or other Affiliate of the
Borrower.
7.14. ENVIRONMENTAL COMPLIANCE. To the Borrower's knowledge:
(a) none of the Borrower, its Subsidiaries or any of their
operations on the Real Estate is in violation, or alleged violation, of
any judgment, decree, order, law, license, rule or regulation
pertaining to environmental matters, including without limitation,
those arising under Environmental Laws which violation would have a
material adverse effect on the business, assets or financial condition
of the Borrower and its Subsidiaries taken as a whole;
(b) neither the Borrower nor any of its Subsidiaries has
received notice from any third party including, without limitation, any
federal, state or local governmental authority, (i) that it has been
identified by the EPA as a potentially responsible party under CERCLA
with respect to a site listed on the National Priorities List, 40
C.F.R. Part 300 Appendix B; (ii) that any Hazardous Substances which it
has generated, transported or disposed of has been found at any site at
which a federal, state or local agency or other third party has
conducted or has ordered that any
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Borrower or any of its Subsidiaries conduct a remedial investigation,
removal or other response action pursuant to any Environmental Law;
or (iii) that it is or shall be a named party to any claim, action,
cause of action, complaint, or legal or administrative proceeding (in
each case, contingent or otherwise) arising out of any third party's
incurrence of costs, expenses, losses or damages of any kind
whatsoever in connection with the release of Hazardous Substances;
(c) except as set forth on SCHEDULE 7.14 attached hereto: (i)
no portion of the Real Estate has been used by any of the Borrower or
its Subsidiaries for the handling, processing, storage or disposal of
Hazardous Substances except in accordance with applicable Environmental
Laws; and (ii) in the course of any activities conducted by the
Borrower or its Subsidiaries, no Hazardous Substances have been
generated or are being used on the Real Estate except in accordance
with applicable Environmental Laws.
(d) None of the Borrower and its Subsidiaries or any of the
Real Estate is subject to any applicable Environmental Law requiring
the performance by the Borrower or any of its Subsidiaries of Hazardous
Substances site assessments, or the removal or remediation by the
Borrower or any of its Subsidiaries of Hazardous Substances, or the
giving of notice by the Borrower or any of its Subsidiaries to any
governmental agency or the recording or delivery by the Borrower or any
of its Subsidiaries to other Persons of an environmental disclosure
document or statement by virtue of the transactions set forth herein
and contemplated hereby, or to the effectiveness of any other
transactions contemplated hereby, except to the extent any of the
foregoing would not have a material adverse effect on the business,
assets or financial condition of the Borrower and its Subsidiaries
taken as a whole.
7.15. SUBSIDIARIES, ETC. SCHEDULE 7.15 sets forth all Subsidiaries of
the Borrower as of the Closing Date. Except as set forth on SCHEDULE 7.15 and
as otherwise permitted hereunder, neither the Borrower nor any Subsidiary of
the Borrower is engaged in any joint venture or partnership with any other
Person.
7.16. DISCLOSURE. No representation or warranty made by any of the
Borrower or its Subsidiaries in this Credit Agreement or in any of the other
Loan Documents contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements herein or
therein not misleading in light of the circumstances in which they are made.
Except as disclosed in writing to the Agent, there is no fact known to the
Borrower or, to the knowledge of the Borrower, any of its Subsidiaries, which
materially adversely affects, or which is reasonably likely in the future to
materially adversely affect, the business, assets, or financial condition of
the Borrower and its Subsidiaries, taken as a whole, exclusive of effects
resulting from changes in general economic conditions, legal standards or
regulatory conditions.
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8. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Issuing Bank has any obligation to
issue, extend or renew any Letters of Credit:
8.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the commitment fees, the facility
fees, the Agent's fees and all other fees provided for in this Credit
Agreement and the other Loan Documents to which the Borrower or any of its
Subsidiaries is a party, all in accordance with the terms of this Credit
Agreement and such other Loan Documents.
8.2. MAINTENANCE OF OFFICE. The Borrower will maintain its chief
executive office in Irving, Texas, or at such other place in the United States
of America as the Borrower shall designate upon written notice to the Agent,
where notices, presentations and demands to or upon the Borrower in respect of
the Loan Documents to which the Borrower is a party may be given or made.
8.3. RECORDS AND ACCOUNTS. The Borrower will (i) keep, and cause each
of its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will, to the extent generally accepted
accounting principles are applicable thereto, be made in accordance with
generally accepted accounting principles, (ii) maintain adequate accounts and
reserves for all taxes (including income taxes), depreciation, depletion,
obsolescence and amortization of its properties and the properties of its
Subsidiaries, contingencies, and other reserves, and (iii) at all times engage
Ernst & Young LLP or other independent certified public accountants reasonably
satisfactory to the Agent as the independent certified public accountants of
the Borrower and its Subsidiaries and will not permit more than thirty (30)
days to elapse between the cessation of such firm's (or any successor firm's)
engagement as the independent certified public accountants of the Borrower and
its Subsidiaries and the appointment in such capacity of a successor firm as
shall be reasonably satisfactory to the Agent.
8.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower
will deliver to the Agent and the Agent will then deliver to the Banks:
(a) as soon as available, but in any event not later than
ninety five (95) days after the end of each fiscal year of the
Borrower, the consolidated balance sheet of the Borrower and its
Subsidiaries, each as at the end of such year, and the related
consolidated statement of income and consolidated statement of cash
flow, each setting forth in comparative form the figures for the
previous fiscal year and all such consolidated statements to be in
reasonable detail, prepared in accordance with generally accepted
accounting principles, and certified without
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qualification (except that a qualification for a change in accounting
principles with which such firm of independent certified public
accountants concurs shall be permitted) by Ernst & Young L.L.P. or by
other independent certified public accountants reasonably
satisfactory to the Agent;
(b) as soon as available, but in any event not later than
fifty (50) days after the end of each of the first three fiscal
quarters in each fiscal year of the Borrower, copies of the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries as at
the end of such quarter, and the related consolidated statement of
income and consolidated statement of cash flow for the portion of the
Borrower's fiscal year then elapsed, all in reasonable detail and
prepared in accordance with generally accepted accounting principles,
together with a certification by a financial officer, vice
president-finance, vice president-accounting, treasurer or controller
of the Borrower that the information contained in such financial
statements fairly presents the financial position of the Borrower and
its Subsidiaries on the date thereof (subject to year-end adjustments);
(c) simultaneously with the delivery of the financial
statements referred to in subsections (a) and (b) above, a statement
certified by a financial officer, vice president-finance, vice
president-accounting, treasurer or controller of the Borrower in
substantially the form of EXHIBIT G hereto (a "Compliance Certificate")
and setting forth in reasonable detail computations evidencing
compliance with (i) the covenants contained in Section 10 and (if
applicable) reconciliations to reflect changes in generally accepted
accounting principles since the Balance Sheet Date and (ii) if the
Total Commitment exceeds $100,000,000, evidence of compliance with the
provisions of the Senior Notes restricting the amount of Indebtedness
the Borrower and its Subsidiaries may incur;
(d) as soon as practicable but in any event, within (20)
Business Days after the filing or mailing thereof, copies of all
financial statements filed with the Securities and Exchange Commission
or sent to the stockholders of the Borrower as such;
(e) from time to time such other financial data and
information (including information relating to Guaranteed Pension Plans
and accountants' management letters) as the Agent or any Bank may
reasonably request; and
(f) as soon as available, but in any event not later than
sixty (60) days following the delivery of the financial statements
referred to in clause (a) above or at any other time at which the
Borrower shall desire to submit such updated projections, consolidated
projections of the Borrower and its Subsidiaries updating those
projections delivered pursuant to this Section 8.4(f).
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8.5. NOTICES.
8.5.1. DEFAULTS. Upon becoming aware thereof, the Borrower
will promptly notify the Agent in writing of the occurrence of any
Default or Event of Default. If any Person shall give any notice or
take any other action in respect of a claimed default (whether or not
constituting an Event of Default) under this Credit Agreement or any
other material note, evidence of indebtedness, indenture or other
obligation to which or with respect to which the Borrower or any of its
Subsidiaries is a party or obligor, whether as principal, guarantor,
surety or otherwise, the Borrower shall forthwith, upon becoming aware
thereof, give written notice thereof to the Agent, describing the
notice or action and the nature of the claimed default.
8.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly give
notice to the Agent (i) of any violation of any Environmental Law that
the Borrower or any of its Subsidiaries reports in writing or is
reportable by such Person in writing (or for which any written report
supplemental to any oral report is made) to any federal, state or local
environmental agency and (ii) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice
from any agency of potential environmental liability, of any federal,
state or local environmental agency or board, that has the potential to
materially affect the assets, business or financial condition of the
Borrower and its Subsidiaries taken as a whole.
8.5.3. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause each of its Subsidiaries to, give notice to the Agent in
writing within thirty (30) days of becoming aware of any litigation or
proceedings threatened in writing or any pending litigation and
proceedings affecting the Borrower or any of its Subsidiaries or to
which the Borrower or any of its Subsidiaries is or becomes a party
involving an uninsured claim against the Borrower or any of its
Subsidiaries that could reasonably be expected to have a materially
adverse effect on the assets, financial condition or business of the
Borrower and its Subsidiaries taken as a whole and stating the nature
and status of such litigation or proceedings. The Borrower will, and
will cause each of its Subsidiaries to, give notice to the Agent, in
writing, in form and detail reasonably satisfactory to the Agent,
within ten (10) days of any judgment not covered by insurance, final or
otherwise, against the Borrower or any of its Subsidiaries in an amount
in excess of $10,000,000.
8.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. Subject to the
actions permitted by Section 9.6, the Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done all things necessary to preserve
and keep in full force and effect its corporate existence, rights and
franchises. Subject to the actions permitted by Section 9.6, the Borrower
will, and will cause each of its Subsidiaries to, (i) cause all of its
material properties used or useful in the
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conduct of its business or the business of such Subsidiary to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment, (ii) cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Borrower may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times, and (iii) continue to engage
primarily in the businesses now conducted by them and in related businesses;
PROVIDED that nothing in this Section 8.6 shall prevent the Borrower or any of
its Subsidiaries from discontinuing the operation and maintenance of any of its
businesses or properties, or the Borrower from dissolving a Subsidiary, if
such discontinuance or dissolution is, in the judgment of the Borrower and its
Subsidiaries, desirable in the conduct of its or their business and that do
not in the aggregate materially adversely affect the business of the Borrower
and its Subsidiaries taken as a whole.
8.7. INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, keep adequately insured either with financially sound and
reputable insurers or pursuant to a plan of self-insurance established in
accordance with sound and appropriate practices and in accordance with
applicable law, insurance with respect to such assets, properties and business
as are customarily insured by owners of similar assets, properties and
business against such casualties and contingencies as shall be in accordance
with the general practices of businesses engaged in similar activities in
similar geographic areas and in amounts, containing such terms, in such forms
and for such period as may be reasonable and prudent.
8.8. TAXES. The Borrower will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all lawful claims for labor, materials, or supplies that if unpaid
might by law become a lien or charge upon any of its property; PROVIDED that
any such tax, assessment, charge, levy or claim need not be paid if (i) the
validity or amount thereof shall currently be contested in good faith by
appropriate proceedings and if the Borrower or such Subsidiary shall have set
aside on its books adequate reserves with respect thereto, (ii) adequate bonds
have been obtained with respect thereto, or (iii) the failure to so pay would
not have a material adverse effect on the business, assets or financial
condition of the Borrower and its Subsidiaries taken as a whole; and PROVIDED
FURTHER that, with respect to liens or charges securing an amount less than
$500,000, the Borrower and its Subsidiaries shall have sixty (60) days grace
to accomplish such discharge from the date the Borrower becomes aware of such
lien or charge; and PROVIDED FURTHER the Borrower and each Subsidiary of the
Borrower will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any lien that may
have attached as security therefor.
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8.9. INSPECTION OF PROPERTIES AND BOOKS, ETC. The Borrower shall
permit the Banks, through the Agent or any of the Banks' other designated
representatives, to visit and inspect any of the properties of the Borrower or
any of its Subsidiaries, to examine the books of account of the Borrower and
its Subsidiaries (and to make copies thereof and extracts therefrom), and to
discuss the affairs, finances and accounts of the Borrower and its
Subsidiaries with, and to be advised as to the same by, its and their
officers, all during ordinary business hours and upon reasonable notice from
the Agent or any Bank; PROVIDED THAT, notwithstanding the foregoing, prior to
the occurrence of a Default or Event of Default, the Agent (or its
representatives) or any such Bank will obtain the prior approval of a Senior
Financial Officer of the Borrower, which approval shall not be unreasonably
withheld, prior to any such discussions with officers of the Borrower or any
of its Subsidiaries.
8.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause each of its Subsidiaries to, comply with (i) all
laws and regulations (including all Environmental Laws), to which it may be
subject, noncompliance with which could reasonably be expected to have a
material adverse effect on the business, operations or financial condition of
the Borrower and its Subsidiaries taken as a whole, (ii) the provisions of its
charter documents and by-laws, (iii) all agreements and instruments by which
it or any of its properties may be bound, non-compliance with which would
reasonably be expected to have a materially adverse effect on the business,
operations or financial condition of the Borrower and its Subsidiaries, taken
as a whole, and (iv) all applicable decrees, orders, and judgments,
non-compliance with which would reasonably be expected to have a materially
adverse effect on the business, operations or financial condition of the
Borrower and its Subsidiaries taken as a whole. If any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of any
government shall become necessary or required in order that the Borrower or
any of its Subsidiaries may fulfill its obligations hereunder or any of the
other Loan Documents to which the Borrower or such Subsidiary is a party, the
Borrower will, or (as the case may be) will cause such Subsidiary to,
immediately take or cause to be taken all reasonable steps within the power of
the Borrower or such Subsidiary to obtain such authorization, consent,
approval, permit or license.
8.11. EMPLOYEE BENEFIT PLANS. The Borrower will, promptly upon
receipt or dispatch, furnish to the Agent (i) any notice of an ERISA
Reportable Event (as to which the requirement of 30 days notice has not been
waived), or notification regarding missed contributions, sent to the PBGC in
respect of a Guaranteed Pension Plan and (ii) any other report, demand or
notice from the PBGC or a Multiemployer Plan asserting a current liability of
the Borrower in connection with, or which could reasonably be expected to
result in a material increase in the liability of the Borrower on, the
termination of, or a withdrawal from, a Guaranteed Pension Plan or
Multiemployer Plan.
8.12. USE OF PROCEEDS. The Borrower will use the proceeds of the
Loans and will obtain Letters of Credit solely for working capital and other
general
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corporate purposes, including bond and stock repurchases and acquisitions
permitted hereunder.
8.13. ROYALTY PAYMENTS. The Borrower will cause 5931, Inc. and 5931
Business Trust to make distributions to the Borrower of substantially all
Royalty Payments within 45 days of 5931, Inc. and 5931 Business Trust receipt
of such Royalty Payments.
8.14. FURTHER ASSURANCES. The Borrower will, and will cause each of
its Subsidiaries to, execute such further instruments and documents as the
Agent shall reasonably request to carry out more effectively the purposes of
this Credit Agreement and the other Loan Documents.
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Issuing Bank has any obligations to
issue, extend or renew any Letters of Credit:
9.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or be or remain liable,
contingently or otherwise, with respect to any Indebtedness other than:
(a) Indebtedness to the Banks and the Agent arising under any
of the Loan Documents;
(b) the Borrower and its Subsidiaries may permit to exist the
existing Indebtedness shown on SCHEDULE 9.1 hereto;
(c) Indebtedness under the Senior Notes as in effect on the
date hereof or as modified consistent with Section 9.5 or any
refinancing or replacement thereof; PROVIDED, HOWEVER, that (i) the
outstanding principal amount of such refinancing or replacement shall
not exceed $150,000,000 minus the amount of any repurchases made
pursuant to Section 9.5(b) and (ii) such refinancing or replacement
shall be in terms no less favorable to the Borrower than the terms of
the Senior Notes Indenture as on effect on the date hereof;
(d) the Borrower and its Subsidiaries that are Guarantors
may incur Indebtedness owing to and held by the Borrower or other
Subsidiaries of the Borrower;
(e) Subsidiaries of the Borrower which are not Guarantors
may incur Indebtedness to the Borrower and other Subsidiaries of the
Borrower not to exceed $10,000,000 at any time;
(f) MC may incur (i) unsecured Indebtedness in an aggregate
amount not to exceed an amount equal to the Canadian Dollar equivalent
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of $10,000,000 outstanding at any one time and (ii) Indebtedness to the
Borrower pursuant to the Canadian License Agreement;
(g) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness of the Borrower and its Subsidiaries represented by
Capitalized Lease obligations, mortgage financings or purchase money
obligations, in each case incurred for the purpose of financing or
refinancing all or any part of the purchase price or costs of
construction, repairs, renovation, remodeling, expansion or other
improvement of property, plant and equipment, including services and
equipment supporting such items used in Borrower's business or any
Subsidiary's business in an aggregate principal amount outstanding not
to exceed ten percent (10%) of Consolidated Tangible Net Worth of the
Borrower and its Subsidiaries at the time of any incurrence of such
Indebtedness;
(h) the Borrower and its Subsidiaries may incur or permit to
exist, unsecured Indebtedness consisting of commercial or stand-by
letters of credit with financial institutions that are not Lenders
PROVIDED that the maximum amount outstanding of such Indebtedness at
any one time for the benefit of any Person that is not an Affiliate of
the Borrower shall not exceed $15,000,000;
(i) the Borrower and its Subsidiaries may incur or permit to
exist unsecured Indebtedness consisting of performance bonds, bankers'
acceptances, surety or appeal bonds provided by the Borrower or any
Subsidiary in the ordinary course of its business and which do not
secure other Indebtedness;
(j) any Subsidiary of the Borrower that is a Guarantor may
guaranty the obligations of the Borrower under the Senior Notes;
(k) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness to 5931, Inc. and 5931 Business Trust consisting of
obligations to make Royalty Payments and other Indebtedness not to
exceed $1,000,000,000 in accordance with the provisions of the
Subordination Agreement;
(l) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness with respect to accounts payable and accrued
liabilities incurred in the ordinary course of business, and each of
the Subsidiaries may incur or permit to exist Indebtedness with respect
to accounts payable to the Borrower related to the Borrower's transfer
of inventory to such Subsidiary and related to obligations incurred and
payments required under operating leases paid by the Borrower on behalf
of such Subsidiary, each in the ordinary course of business;
(m) the Borrower and any Subsidiary may incur or permit to
exist Indebtedness in the form of guaranties by the Borrower or any
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Subsidiary of (i) Indebtedness of the Borrower or any Subsidiary
which the Borrower or such Subsidiary is permitted to incur pursuant
to this Section 9.1, (ii) Indebtedness of MC up to the Canadian
Dollar equivalent of $10,000,000 as permitted above, (iii)
Investments permitted by Section 9.3(f), and (iv) operating lease
obligations of the Borrower and any Subsidiary;
(n) the Borrower may incur or permit to exist Indebtedness
with respect to the Capitalized Leases incurred from time to time for
point-of-sale equipment and store systems, and services and equipment
supporting this equipment and systems, the obligations under which do
not exceed $40,000,000 in the aggregate throughout the term of this
Credit Agreement;
(o) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness assumed with respect to acquisitions permitted in
accordance with Section 9.6, or consisting of guaranties of such
Indebtedness, so long as such Indebtedness was not created in
anticipation of such acquisition and six months following the closing
date of such acquisition does not exceed, in the aggregate,
$10,000,000;
(p) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness under deferred compensation plans, employee
separation agreements, employee stock purchase plans and 401(k) plans
of the Borrower and/or its Subsidiaries;
(q) the Borrower may incur or permit to exist Indebtedness
with respect to stock repurchases by the Borrower permitted in
accordance with Section 9.4 in an aggregate amount not to exceed
$70,000,000;
(r) the Borrower and its Subsidiaries may incur or permit to
exist Indebtedness with respect to Derivative Transactions;
(s) the Borrower and its Subsidiaries may permit to exist
Indebtedness consisting of letters of credit with any of the Banks,
which Indebtedness is not an Obligation or a Letter of Credit under
this Agreement; PROVIDED, HOWEVER, that Indebtedness for standby
letters of credit permitted under this Section 9.1(s) shall not at
any time exceed $30,000,000 in the aggregate; and
(t) in addition to the Indebtedness permitted in subsections
(a)-(s) of this Section 9.1, the Borrower and its Subsidiaries
(excluding 5931, Inc. and 5931 Business Trust) may incur or permit to
exist additional Indebtedness not to exceed at any one time ten
percent (10%) of the Consolidated Tangible Net Worth of the Borrower
and its Subsidiaries.
9.2. RESTRICTIONS ON LIENS. The Borrower will not, and will not
permit any of its Subsidiaries to, (i) create or incur or suffer to be created
or incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other
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security interest of any kind upon any of its property or assets of any
character whether now owned or hereafter acquired, or upon the income
or profits therefrom; (ii) transfer any of such property or assets or
the income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (iii) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (iv) suffer to
exist for a period of more than thirty (30) days after the same shall have
been incurred any Indebtedness or claim or demand against it that if unpaid
might by law or upon bankruptcy or insolvency, or otherwise, be given any
priority whatsoever over its general creditors; (v) sell, assign, pledge or
otherwise transfer any "receivables" as defined in clause (viii) of the
definition of the term "Indebtedness," (and subject to the exceptions therein)
with or without recourse; PROVIDED HOWEVER, the Borrower and its Subsidiaries
may create, assume or permit to exist the following liens:
(a) liens on property acquired directly or indirectly by the
Borrower in accordance with the terms and provisions of Section 9.6
so long as such liens are not securing Indebtedness of the Borrower
in excess of the fair market value of such property;
(b) liens (other than blanket liens on the Borrower's or its
Subsidiaries' equipment, inventory, accounts or other receivables),
securing Indebtedness of the Borrower and its Subsidiaries not to
exceed five percent (5%) of the Consolidated Tangible Net Worth of
the Borrower and its Subsidiaries;
(c) liens for taxes or assessments either not yet delinquent
or the validity or amount of which is being contested in good faith
by appropriate proceedings diligently prosecuted and as to which
adequate reserves shall have been set aside in conformity with
generally accepted accounting principles;
(d) deposits or pledges to secure the payment of workers
compensation, unemployment insurance or other social security
benefits or obligations, or to secure the performance of bids, trade
contracts, public or statutory obligations, surety or appeal bonds
and other obligations of a like nature incurred in the ordinary
course of business;
(e) materialmen's, mechanic's, workmen's, repairmen's, or
other like liens arising in the ordinary course of business or by
operation of law to secure obligations not yet delinquent or which
within thirty (30) days of receipt by the Borrower or any of its
Subsidiaries of any lien filing by a lien claimant are being
contested by the Borrower or such Subsidiary in good faith and for
which (i) adequate reserves shall have been set aside in conformity
with generally accepted accounting principles or (ii) as to which
adequate bonds shall have been obtained and any notices or other
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statutory requirements filed by any contractor, subcontractor,
workman or repairman relating to construction or improvements to
property;
(f) liens securing the Indebtedness permitted under Section
9.1(g) and Section 9.1(n), provided that in any case:
(i) no such lien shall extend to or cover any other
property or assets of the Borrower or of any Subsidiary, as
the case may be, and
(ii) the aggregate principal amount of the
indebtedness secured by all such liens in respect of any such
property or assets shall not exceed the greater of (A) the
fair market value of such property or assets at the time of
such acquisition, or (B) the good faith allocated purchase
price of such assets;
(g) consensual landlord's liens and landlord's liens arising
by operation of law;
(h) liens existing on the date hereof and shown on SCHEDULE
9.2 hereto.
9.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except:
(a) Investments in Cash Equivalents;
(b) Investments in trade receivables incurred in the ordinary
course of business;
(c) Investments in endorsements of negotiable instruments for
collection in the ordinary course of business;
(d) Investments by the Borrower in any Subsidiary that has
executed a Guaranty and Investments by any Subsidiary in the Borrower;
(e) Investments by the Borrower or any Subsidiary in any
Foreign Subsidiary that has executed a Guaranty in an amount not to
exceed in the aggregate at any time $15,000,000;
(f) Investments by the Borrower in Subsidiaries that have not
executed a Guaranty (A) in connection with the transfer of inventory to
such Subsidiary or (B) in connection with obligations incurred, and
payments required, under Capitalized Leases and operating leases, each
in the ordinary course of business and paid by the Borrower to Persons
on behalf of such Subsidiaries;
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(g) Investments by the Borrower or any Subsidiary in
Subsidiaries of the Borrower existing as of the date hereof at the
levels as of the date hereof;
(h) Investments by the Borrower in Subsidiaries consisting of
loans or Indebtedness to the extent permitted by Section 9.1;
(i) Investments in 5931, Inc. and 5931 Business Trust in
connection with Royalty Payments and payments necessary to cover
administrative costs;
(j) Investments in Subsidiaries acquired or created pursuant
to Section 9.6 or 9.11 in the amounts permitted by such sections;
(k) Investments pursuant to deferred compensation plans for
former and current directors, officers, consultants and employees
(l)Investments by the Borrower in MC pursuant to the Canadian
License Agreement; and
(m) any other Investments not otherwise permitted in
Subsections (a)-(l) in this Section 9.3 in an aggregate amount not to
exceed ten percent (10%) of the Consolidated Tangible Net Worth of
the Borrower and its Subsidiaries.
9.4. DISTRIBUTIONS. The Borrower and its Subsidiaries will not make
any Distributions, PROVIDED, HOWEVER, (a) in addition to the Distributions
permitted by clauses (b)-(c) below, the Borrower may declare or pay
Distributions so long as the aggregate amount of Distributions paid after the
Closing Date do not exceed in the aggregate an amount equal to the sum of (i)
$70,000,000 PLUS (ii) fifty percent (50%) of Consolidated Net Income of the
Borrower and its Subsidiaries for each Fiscal Year of the Borrower ending
after the Closing Date, PLUS (iii) an amount equal to the aggregate amount of
cash proceeds received by the Borrower after February 3, 2001, in connection
with the proceeds received from the issuance of equity, (b) Subsidiaries of
the Borrower may make Distributions to the Borrower and to Subsidiaries of the
Borrower that have executed a Guaranty, and (c) the Borrower and its
Subsidiaries may make Distributions of stock and options to acquire stock
pursuant to the terms of their stock option plans. The Borrower will not hold
repurchased shares of its common stock as treasury stock and, upon the
Borrower's repurchase of shares of its common stock, it will immediately
cancel and retire such stock.
9.5. PAYMENTS AND MODIFICATIONS OF SENIOR NOTES. (a) The Borrower
will not and will not permit any of its Subsidiaries to amend, supplement or
otherwise modify the terms of the Senior Notes that would result in (i) an
increase in the outstanding principal amount of the Senior Notes except to the
extent permitted by Section 9.1(c), (ii) an increase in any principal,
interest, fees, or other amounts payable under the Senior Notes Indenture or
the Senior Notes,
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(iii) a change in any date fixed for any payment of principal, interest, fees,
or other amounts payable under the Senior Notes Indenture or the Senior Notes
(including, without limitation, as a result of any redemption, defeasance or
otherwise), (iv) a change in any percentage of holders of the Senior Notes
under the Senior Notes Indenture required under the terms of such documents
to take (or refrain from taking) any action, (v) a change that grants or
permits the granting of any security interest or Lien on any asset or property
of the Borrower or any Subsidiary to secure the Senior Notes or (vi) it being
more difficult for the Borrower to comply with the covenants contained in such
document and (b) the Borrower will not, and will not permit any of its
Subsidiaries to, make any prepayment, redemption or repurchase of any of
the Senior Notes except to the extent permitted by Section 9.1(c) UNLESS the
Majority Banks consent in writing, which consent shall not be unreasonably
withheld; PROVIDED, HOWEVER, that so long as no Default or Event of Default
has occurred and is continuing, the Borrower may pay up to $50,000,000 in the
aggregate after the Closing Date to purchase, redeem or retire Senior Notes.
9.6. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
9.6.1. MERGERS AND ACQUISITIONS. The Borrower will not, and
will not permit any of its Subsidiaries to, become a party to any
merger or consolidation, or agree to or effect any asset acquisition or
stock acquisition (other than the acquisition of assets in the ordinary
course of business consistent with past practices); other than
(a) the merger or consolidation of one or more of
the Subsidiaries of the Borrower;
(b) the acquisition (whether of stock or assets or by
means of a merger or consolidation) of any other Person, PROVIDED that
(i) immediately after such acquisition, and
after giving effect thereto on a PRO FORMA basis, no
Default or Event of Default shall then exist;
(ii) if required by applicable law, the
board of directors and the shareholders or the
equivalent, of such other Person has approved such
acquisition;
(iii) such other Person is in, or
immediately after such acquisition is converted into,
the same or substantially similar line of business of
the Borrower and its Subsidiaries;
(iv) in connection with any such
acquisition, the aggregate consideration (including
assumption of Indebtedness) paid in connection with
such acquisition shall not exceed an amount equal to
ten percent (10%) of the Consolidated Tangible Net
Worth of the Borrower and its
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Subsidiaries, determined immediately prior to such
acquisition; and
(v) if the Borrower or any Guarantor and
such other Person merge and the Borrower or any
Guarantor is the surviving entity.
9.6.2. DISPOSITION OF ASSETS. The Borrower will not, and will
not permit any of its Subsidiaries to, become a party to or agree to or
effect any disposition of assets, other than:
(a) the disposition of assets in the ordinary course
of business;
(b) disposition of obsolete equipment;
(c) transfers of intellectual property rights from
the Borrower or any of its Subsidiaries to 5931 Business
Trust; and
(d) sale-leaseback transactions and other
dispositions of assets that do not have a materially adverse
effect on the business, assets or financial condition of the
Borrower and its Subsidiaries taken as a whole, PROVIDED that
(i) the aggregate net book value of the assets to be sold
after the Closing Date does not, at any time, exceed twenty
percent (20%) of the Consolidated Total Assets of the Borrower
and its Subsidiaries, in each case determined as of the date
of the disposition of such assets and (ii) such assets are
sold in an arm's length transaction for fair market value
(after giving effect to all tax benefits, if any, associated
with such sale).
9.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. Other than in compliance
with Environmental Laws or to the extent that failure to comply does not
result in the Borrower and its Subsidiaries incurring liability in excess of
$10,000,000, the Borrower will not, and will not permit any of its
Subsidiaries to, (i) use any of the Real Estate or any portion thereof for the
handling, processing, storage or disposal of Hazardous Substances, (ii) cause
or permit to be located on any of the Real Estate any underground tank or
other underground storage receptacle for Hazardous Substances, (iii) generate
any Hazardous Substances on any of the Real Estate, or (iv) conduct any
activity at any Real Estate or use any Real Estate in any manner so as to
cause a release (i.e. releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, disposing or
dumping) or threatened release of Hazardous Substances on, upon or into the
Real Estate, and the Borrower will not, and will not permit any of its
Subsidiaries to, otherwise conduct any activity at any Real Estate or use any
Real Estate in any manner that would violate any Environmental Law or bring
such Real Estate in violation of any Environmental Law.
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9.8. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA
Affiliate will
(a) engage in any "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975 of the Code which
could result in a material liability for the Borrower or any of its
Subsidiaries, which is not covered by a prohibition transaction
exemption granted by the Department of Labor; or
(b) permit any Guaranteed Pension Plan to incur an
"accumulated funding deficiency", as such term is defined in Section
302 of ERISA in an amount which would reasonably be expected to have
a material adverse effect on the business, assets or financial
condition of the Borrower and its Subsidiaries taken as a whole,
whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of the Borrower or any of its Subsidiaries pursuant to Section
302(f) or Section 4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances
requiring the posting of security pursuant to Section 307 of ERISA or
Section 401(a)(29) of the Code; or
(e) permit or take any action which would result in the
aggregate benefit liabilities (within the meaning of Section 4001 of
ERISA) of all Guaranteed Pension Plans exceeding the value of the
aggregate assets of such Plans disregarding for this purpose the
benefit liabilities and assets of any such Plan with assets in excess
of benefit liabilities, by an amount in excess of $5,000,000.
9.9. BUSINESS ACTIVITIES. The Borrower will not, and will not permit
any of its Subsidiaries to, engage directly or indirectly (whether through
Subsidiaries or otherwise) in any type of business other than the businesses
conducted by them on the Closing Date and in related businesses.
9.10. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will
not permit any of its Subsidiaries to, engage in any transaction with any
Affiliate (other than the Borrower or any other Subsidiary of the Borrower,
and other than for services as employees, officers and directors, for Royalty
Payments or loans to the Borrower from the recipient of such Royalty Payments
and for transactions with officers and directors of the Borrower or any
Subsidiary in their capacity as such or in their capacity as a consultant,
including, without limitation, salary, bonuses, stock options, fees and other
forms of compensation), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of
real or
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personal property to or from, or otherwise requiring payments to or from any
such Affiliate, except (a) to the extent that all such transactions do not
exceed an amount equal to $10,000,000 per annum, (b) on terms no less favorable
to the Borrower or such Subsidiary than would have been obtainable on an
arm's-length basis with a third party or (c) in connection with the Canadian
License Agreement.
9.11. CREATION AND MAINTENANCE OF SUBSIDIARIES. The Borrower will
not, and will not permit any of its Subsidiaries to create or acquire, in any
manner whatsoever, any new Subsidiaries; PROVIDED, HOWEVER, the Borrower and
its Subsidiaries may create or acquire Subsidiaries, so long as:
(i) there exists no Default or Event of Default and
immediately after such creation, giving effect thereto on a
PRO FORMA basis, no Default or Event of Default shall then
exist;
(ii) each new Subsidiary which is an "unrestricted
subsidiary" (as such term is defined in the Senior Note
Indenture) shall execute a Guaranty of the Obligations
hereunder;
(iii) the Borrower and each new United States
Subsidiary shall execute and deliver such certificates,
agreements and documents as Agent or Banks may reasonably
require; and
(iv) no United States Subsidiary shall issue any new
stock of any classification without Majority Banks' prior
written consent, except issuance to the Borrower or any other
Subsidiary.
9.12. DERIVATIVE TRANSACTIONS. The Borrower will not, and will not
permit any of its Subsidiaries to, incur or permit to exist any Derivative
Transactions, other than Derivative Transactions incurred in the ordinary
course of business, PROVIDED, HOWEVER, such Derivative Transactions do not
increase the Indebtedness of the Borrower outstanding at any time (net of
assets received) other than as a result of fluctuations in foreign currency
exchange rates or interest rates or by reason of fees, indemnities and
compensation payable thereunder.
9.13. SALES OF ACCOUNTS. The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any securitization facilities involving
any (a) accounts or general intangibles for money due or to become due, (b)
chattel paper, instruments or documents creating or evidencing a right to
payment of money or (c) other receivables.
9.14. NEGATIVE PLEDGES. The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any agreement (excluding this Credit
Agreement and the Loan Documents) prohibiting the creation or assumption of
any lien upon its properties, revenues or assets, whether now owned or
hereafter acquired, other than agreements with Persons prohibiting any such
lien on
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assets in which such Person has a prior security interest which is permitted by
Section 9.2.
10. FINANCIAL COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Agent has any obligation to issue,
extend or renew any Letters of Credit:
10.1. MAXIMUM ADJUSTED BALANCE SHEET LEVERAGE RATIO.
The Borrower will not permit as of the last day of each fiscal
quarter of the Borrower, the ratio of (a) the sum of (i) Consolidated Funded
Debt as of such date, PLUS (ii) six (6) times Consolidated Rental Expense for
the four consecutive fiscal quarters just ended to (b) the sum of (i) Total
Capital as of such date, PLUS (ii) six (6) times Consolidated Rental Expense
for the four consecutive fiscal quarters just ended to exceed 0.75 to 1.00.
10.2. MINIMUM CASH FLOW COVERAGE RATIO.
The Borrower will not permit for any period of four consecutive
fiscal quarters, the ratio of (a) Consolidated EBITDAR for such period to (b)
the sum of (i) Consolidated Total Interest Expense for such period, PLUS (ii)
any scheduled amortization of principal on Indebtedness (INCLUDING
amortization relating to Capital Leases) for such period, PLUS (iii)
Consolidated Rental Expense for such period to be less than 1.90 to 1.00.
10.3. CASH FLOW LEVERAGE RATIO.
The Borrower will not permit for any period of four consecutive
fiscal quarters, the ratio of (a) Consolidated Funded Debt as of the last day
of such period to (b) Consolidated EBITDA for such period, to exceed 1.50 to
1.00.
10.4. CAPITAL EXPENDITURES. The Borrower will not make, or permit any
Subsidiary of the Borrower to make, Capital Expenditures in any Fiscal Year
set forth in the table below that exceed, in the aggregate, the amount set
forth opposite such fiscal year in such table:
FISCAL YEAR AMOUNT
----------- ------
2001 $200,000,000
2002 $150,000,000
2003 $190,000,000
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2004 $165,000,000
2005 (IF APPLICABLE) $200,000,000
provided, however, that, if during any Fiscal Year the amount of Capital
Expenditures permitted for that Fiscal Year in the table above is not so
utilized, twenty five percent (25%) of such unutilized amount may be utilized
in the next succeeding fiscal year but not in any subsequent Fiscal Year.
11. CLOSING CONDITIONS.
The obligations of the Banks to make the initial Loans and of the
Agent to issue any initial Letters of Credit shall be subject to the
satisfaction of the following conditions precedent on or prior to the Closing
Date:
11.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered to the Agent by the Borrower, shall be in full force
and effect and shall be in form and substance satisfactory to each of the
Banks.
11.2. CERTIFIED COPIES OF CHARTER AND DEBT DOCUMENTS. The Agent shall
have received from the Borrower a copy, certified by a duly authorized officer
of the Borrower to be true and complete on the Closing Date, in form and
substance satisfactory to the Agent of each of (i) its charter or other
incorporation documents as in effect on such date of certification, (ii) its
by-laws as in effect on such date, (iii) the Senior Notes and Senior Note
Indenture, and (iv) the documents relating to the Royalty Payments.
11.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by the Borrower of this Credit Agreement
and the other Loan Documents shall have been duly taken, and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
11.4. INCUMBENCY CERTIFICATE. The Agent shall have received from the
Borrower an incumbency certificate, dated as of the Closing Date, signed by a
duly authorized officer of the Borrower, and giving the name and bearing a
specimen signature of each individual who shall be authorized: (i) to sign, in
the name and on behalf of the Borrower, the Loan Documents to make Loan
Requests and Conversion Requests and to apply for Letters of Credit and (ii)
to give notices and to take other action on its behalf under the Loan
Documents.
11.5. OPINION OF COUNSEL. The Agent shall have received a favorable
legal opinion addressed to the Banks and the Agent, dated as of the Closing
Date, in form and substance reasonably satisfactory to the Agent, from Jones
Day Reavis & Pogue, counsel to the Borrower.
11.6. PAYMENT OF FEES. The Borrower shall have paid to the Banks or
the Agent, as appropriate, the fees described in the Fee Letters pursuant to
Sections 5.1 and 5.1.2.
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11.7. PAYOFF LETTER. The Agent shall have received a payoff letter
from Fleet National Bank, as successor in interest to BankBoston, N.A., as
agent, indicating the amount of the loan obligations of the Borrower to Fleet
National Bank, as agent, and the lenders thereof to be discharged on the
Closing Date and an acknowledgment by Fleet National Bank that the existing
Revolving Credit Agreement with Fleet National Bank, as successor in interest
to BankBoston, N.A., as agent, and the several lenders parties thereto, dated
as of August 28, 1998, has been terminated with respect to loans thereunder
upon receipt of such funds, if any are required.
11.8. ABI GUARANTY. ABI shall have executed and delivered to the
Agent for the benefit of the Banks its guaranty of the obligations of the
Borrower hereunder; PROVIDED, HOWEVER, in the event of a sale of all or
substantially all of the assets of ABI or distribution of all or substantially
all of the stock of ABI permitted under Section 9.4 or Section 9.6, the Agent
and the Banks hereby agree to release and discharge such guaranty of ABI.
12. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Loan, and of the Issuing
Bank to issue, extend or renew any Letter of Credit, in each case whether on
or after the Closing Date, shall also be subject to the satisfaction of the
following conditions precedent:
12.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of the Borrower and its Subsidiaries contained
in this Credit Agreement, the other Loan Documents or in any document or
instrument delivered pursuant to or in connection with this Credit Agreement
shall be true and correct in all material respects as of the date as of which
they were made and shall also be true and correct in all material respects at
and as of the time of the making of such Loan or the issuance, extension or
renewal of such Letter of Credit, with the same effect as if made at and as of
that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan
Documents and changes occurring in the ordinary course of business that singly
or in the aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.
12.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law
or regulations thereunder or interpretations thereof that in the reasonable
opinion of any Bank would make it illegal for such Bank to make such Loan or
to participate in the issuance, extension or renewal of such Letter of Credit
or in the reasonable opinion of the Issuing Bank would make it illegal for the
Issuing Bank to issue, extend or renew such Letter of Credit.
12.3. GOVERNMENTAL REGULATION. Each Bank shall have received such
statements from the Borrower in substance and form reasonably satisfactory to
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such Bank as such Bank shall require from the Borrower for the purpose of
compliance with any applicable regulations of the Comptroller of the Currency
or the Board of Governors of the Federal Reserve System.
12.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with
the transactions contemplated by this Credit Agreement, the other Loan
Documents and all other documents incident thereto shall be reasonably
satisfactory in substance and in form to the Agent and the Agent's Special
Counsel, the Agent and such counsel shall have received all such counterpart
originals or certified or other copies of such documents as the Agent may
reasonably request.
13. EVENTS OF DEFAULT; ACCELERATION; ETC.
13.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse of time
or both is required, then, prior to such notice or lapse of time, "Defaults")
shall occur:
(a) the Borrower shall fail to pay any principal of the Loans
or any Reimbursement Obligation when the same shall become due and
payable, whether at the stated date of maturity or any accelerated date
of maturity or at any other date fixed for payment;
(b) the Borrower or any of its Subsidiaries shall fail to pay
any interest on the Loans, the commitment fee, any Letter of Credit
Fee, the Agent's fee, or other sums due hereunder or under any of the
other Loan Documents, within five (5) days following receipt of written
notice from the Agent, on which date the same shall become due and
payable, whether at the stated date of maturity or any accelerated date
of maturity or at any other date fixed for payment;
(c) the Borrower shall fail to comply with any of its
covenants contained in Section 9 or Section 10;
(d) the Borrower or any of its Subsidiaries shall fail to
perform any term, covenant or agreement contained herein or in any of
the other Loan Documents (other than those specified elsewhere in
this Section 13.1) for fifteen (15) days after written notice of such
failure has been given to the Borrower by the Agent;
(e) any representation or warranty of the Borrower or any of
its Subsidiaries in this Credit Agreement or any of the other Loan
Documents or in any other document or instrument delivered pursuant to
or in connection with this Credit Agreement shall prove to have been
false in any material respect upon the date when made or deemed to have
been made or repeated;
(f) the Borrower or any of its Subsidiaries shall fail to pay
at maturity, or within any applicable period of grace, any obligation
for
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borrowed money or credit received or in respect of any Capitalized
Leases, which obligations exceed $10,000,000 in the aggregate, or fail
to observe or perform in any material respect any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money or credit received or in respect
of any Capitalized Leases, which exceed $10,000,000 in the aggregate,
for such period of time as would permit (assuming the giving of
appropriate notice if required) the holder or holders thereof or of any
obligations issued thereunder to accelerate the maturity thereof;
(g) the Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of the Borrower or any of
its Subsidiaries or of any substantial part of the assets of the
Borrower or any of its Subsidiaries or shall commence any case or other
proceeding relating to the Borrower or any of its Subsidiaries under
any bankruptcy, reorganization, arrangement, insolvency, readjustment
of debt, dissolution or liquidation or similar law of any jurisdiction,
now or hereafter in effect, or shall take any action to authorize or in
furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall
be commenced against the Borrower or any of its Subsidiaries and the
Borrower or any of its Subsidiaries shall indicate its approval
thereof, consent thereto or acquiescence therein or such petition or
application shall not have been dismissed within sixty (60) days
following the filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any
of its Subsidiaries bankrupt or insolvent, or approving a petition in
any such case or other proceeding, or a decree or order for relief is
entered in respect of the Borrower or any Subsidiary of the Borrower in
an involuntary case under federal bankruptcy laws as now or hereafter
constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than sixty days, whether or not consecutive, any
final judgment against the Borrower or any of its Subsidiaries that,
with other outstanding final judgments, undischarged, against the
Borrower or any of its Subsidiaries exceeds in the aggregate
$10,000,000;
(j) if any of the Loan Documents shall be canceled,
terminated, revoked or rescinded, in each case otherwise than in
accordance with the terms thereof or with the express prior written
agreement, consent or approval of the Banks, or any action at law, suit
or in equity or other legal proceeding to cancel, revoke or rescind any
of the Loan Documents shall be commenced by or on behalf of the
Borrower or any of its
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Subsidiaries party thereto or any of their respective stockholders,
or any court or any other governmental or regulatory authority or
agency of competent jurisdiction shall make a determination that, or
issue a judgment, order, decree or ruling to the effect that, any one
or more of the Loan Documents is illegal, invalid or unenforceable in
accordance with the terms thereof;
(k) the Borrower or any ERISA Affiliate incurs any liability
in connection with a termination of a Guaranteed Pension Plan to the
PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in an
aggregate amount exceeding $5,000,000, or the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of
ERISA by a Multiemployer Plan requiring aggregate annual payments
exceeding $5,000,000, or any of the following occurs with respect to a
Guaranteed Pension Plan: (i) an ERISA Reportable Event, or a failure to
make a required installment or other payment (within the meaning of
Section 302(f)(1) of ERISA), PROVIDED that the Agent determines in its
reasonable discretion that such event (A) could reasonably be expected
to result in liability of the Borrower or any of its Subsidiaries to
the PBGC or such Guaranteed Pension Plan in an aggregate amount
exceeding $5,000,000 and (B) would present a material risk for the
termination of such Guaranteed Pension Plan by the PBGC, for the
appointment by the appropriate United States District Court of a
trustee to administer such Guaranteed Pension Plan or for the
imposition of a lien in favor of such Guaranteed Pension Plan; or (ii)
the appointment by a United States District Court of a trustee to
administer such Guaranteed Pension Plan; or (iii) the institution by
the PBGC of proceedings to terminate such Guaranteed Pension Plan and
such proceedings have not been dismissed within sixty (60) days
following the date of such institution;
(l) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any court or any
administrative or regulatory agency from conducting any material part
of its business and such order shall continue in effect for more than
thirty (30) days;
(m) there shall occur any material damage to, or loss, theft
or destruction of, any assets of the Borrower or its Subsidiaries,
whether or not insured, or any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty, which in
any such case causes, for more than thirty (30) consecutive days, the
cessation or substantial curtailment of revenue producing activities at
any facility of the Borrower or any of its Subsidiaries if such event
or circumstance is not covered by business interruption insurance and
would have a material adverse effect on the business or financial
condition of the Borrower and its Subsidiaries taken as a whole;
(n) there shall occur any Change in Control of the Borrower;
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then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrower declare all amounts owing with respect to this Credit Agreement,
the Notes and the other Loan Documents and all Reimbursement Obligations to
be, and they shall thereupon forthwith become, immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower; PROVIDED that in the event of any
Event of Default specified in Sections 13.1(g), 13.1(h) or 13.1(j), all such
amounts shall become immediately due and payable automatically and without any
requirement of notice from the Agent or any Bank.
13.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in Section 13.1(g) or Section 13.1(h) shall occur, any
unused portion of the Total Commitment shall automatically terminate and each
of the Banks shall be relieved of all further obligations to make Loans to the
Borrower and the Issuing Bank shall be relieved of all further obligations to
issue, extend or renew Letters of Credit. If any other Event of Default shall
have occurred and be continuing, the Agent may and, upon the request of the
Majority Banks, shall, by notice to the Borrower, terminate the unused portion
of the Total Commitment, and upon such notice being given such unused portion
of the Total Commitment hereunder shall terminate immediately and each of the
Banks shall be relieved of all further obligations to make Loans and the
Issuing Bank shall be relieved of all further obligations to issue, extend or
renew Letters of Credit. No termination of the Total Commitment shall relieve
the Borrower or any of its Subsidiaries of any of its existing Obligations.
13.3. REMEDIES. In case any one or more of the Events of Default
shall have occurred and be continuing, and whether or not the Banks shall have
accelerated the maturity of the Loans pursuant to Section 13.1, each Bank, if
owed any amount with respect to the Loans or the Reimbursement Obligations,
may, with the consent of the Majority Banks but not otherwise, proceed to
protect and enforce its rights by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant
or agreement contained in this Credit Agreement and the other Loan Documents
or any instrument pursuant to which the Obligations to such Bank are
evidenced, including as permitted by applicable law the obtaining of the EX
PARTE appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Bank. No remedy herein conferred upon any
Bank or the Agent or the holder of any Note or purchaser of any Letter of
Credit Participation is intended to be exclusive of any other remedy and each
and every 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 or any other provision of law.
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14. SETOFF.
During the continuance of any Event of Default, any deposits or other
sums credited by or due from any of the Banks to the Borrower and any
securities or other property of the Borrower (but excluding accounts held in
custody by any Bank in the investment group of such Bank for investment
services provided to the Borrower) in the possession of such Bank may be
applied to or set off by such Bank against the payment of Obligations and any
and all other liabilities, direct, or indirect, absolute or contingent, due or
to become due, now existing or hereafter arising, of the Borrower to such
Bank. Each of the Banks agrees with each other Bank that (i) if an amount to
be set off is to be applied to Indebtedness of the Borrower to such Bank,
other than Indebtedness evidenced by the Notes held by such Bank or
constituting such Reimbursement Obligations owed to such Bank, such amount
shall be applied ratably to such other Indebtedness and to the Indebtedness
evidenced by all such Notes held by such Bank or constituting Reimbursement
Obligations owed to such Bank, and (ii) if such Bank shall receive from the
Borrower, whether by voluntary payment, exercise of the right of setoff,
counterclaim, cross action, enforcement of the claim evidenced by the Notes
held by, or constituting Reimbursement Obligations owed to, such Bank by
proceedings against the Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings,
or otherwise, and shall retain and apply to the payment of the Note or Notes
held by, or Reimbursement Obligations owed to, such Bank any amount in excess
of its ratable portion of the payments received by all of the Banks with
respect to the Notes held by, and Reimbursement Obligations owed to, all of
the Banks, such Bank will make such disposition and arrangements with the
other Banks with respect to such excess, either by way of distribution, PRO
TANTO assignment of claims, subrogation or otherwise as shall result in each
Bank receiving in respect of the Notes held by it or Reimbursement obligations
owed it, its proportionate payment as contemplated by this Credit Agreement;
PROVIDED that if all or any part of such excess payment is thereafter
recovered from such Bank, such disposition and arrangements shall be rescinded
and the amount restored to the extent of such recovery, but without interest.
15. THE AGENT.
15.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of
each of the Banks and to exercise all such powers as are hereunder and
under any of the other Loan Documents and any related documents
delegated to the Agent, together with such powers as are reasonably
incident thereto, PROVIDED that no duties or responsibilities not
expressly assumed herein or therein shall be implied to have been
assumed by the Agent.
(b) The relationship between the Agent and each of the Banks
is that of an independent contractor. The use of the term "Agent" is
for
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convenience only and is used to describe, as a form of convention,
the independent contractual relationship between the Agent and each of
the Banks. Nothing contained in this Credit Agreement nor the other
Loan Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless
a "representative" of the Banks, as that term is defined in Article 1
of the Uniform Commercial Code, for purposes of actions for the benefit
of the Banks and the Agent with respect to any collateral security and
guaranties contemplated by the Loan Documents.
15.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to
its rights and duties under this Credit Agreement and the other Loan
Documents. The Agent may utilize the services of such Persons as the Agent in
its sole discretion may reasonably determine, and all reasonable fees and
expenses of any such Persons shall be paid by the Borrower.
15.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of
any oversight or error of judgment whatsoever, except that the Agent or such
other Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
15.4. NO REPRESENTATIONS.
15.4.1. GENERAL. The Agent shall not be responsible for the
execution or validity or enforceability of this Credit Agreement, the
Notes, the Letters of Credit, any of the other Loan Documents or any
instrument at any time constituting, or intended to constitute,
collateral security for the Notes, or for the value of any such
collateral security or for the validity, enforceability or
collectibility of any such amounts owing with respect to the Notes, or
for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or
instrument hereafter furnished to it by or on behalf of the Borrower or
any of its Subsidiaries, or be bound to ascertain or inquire as to the
performance or observance of any of the terms, conditions, covenants or
agreements herein or in any instrument at any time constituting, or
intended to constitute, collateral security for the Notes or to inspect
any of the properties, books or records of the Borrower
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or any of its Subsidiaries. The Agent shall not be bound to ascertain
whether any notice, consent, waiver or request delivered to it by the
Borrower or any holder of any of the Notes shall have been duly
authorized or is true, accurate and complete. The Agent has not made
nor does it now make any representations or warranties, express or
implied, nor does it assume any liability to the Banks, with respect
to the credit worthiness or financial conditions of the Borrower or
any of its Subsidiaries. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank,
and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into
this Credit Agreement.
15.4.2. CLOSING DOCUMENTATION, ETC. For purposes of
determining compliance with the conditions set forth in Section 11,
each Bank that has executed this Credit Agreement shall be deemed to
have consented to, approved or accepted, or to be satisfied with, each
document and matter either sent, or made available, by the Agent or the
Arranger to such Bank for consent, approval, acceptance or
satisfaction, or required thereunder to be to be consent to or approved
by or acceptable or satisfactory to such Bank, unless an officer of the
Agent or the Arranger active upon the Borrower's account shall have
received notice from such Bank prior to the Closing Date specifying
such Bank's objection thereto and such objection shall not have been
withdrawn by notice to the Agent or the Arranger to such effect on or
prior to the Closing Date.
15.5. PAYMENTS.
15.5.1. PAYMENTS TO AGENT. A payment by the Borrower to the
Agent hereunder or any of the other Loan Documents for the account of
any Bank shall constitute a payment to such Bank. The Agent agrees
promptly to distribute to each Bank such Bank's PRO RATA share of
payments received by the Agent for the account of the Banks except as
otherwise expressly provided herein or in any of the other Loan
Documents.
15.5.2. DISTRIBUTION BY AGENT. If in the opinion of the Agent
the distribution of any amount received by it in such capacity
hereunder, under the Notes or under any of the other Loan Documents
might involve it in liability, it may refrain from making distribution
until its right to make distribution shall have been adjudicated by a
court of competent jurisdiction. If a court of competent jurisdiction
shall adjudge that any amount received and distributed by the Agent is
to be repaid, each Person to whom any such distribution shall have been
made shall either repay to the Agent its proportionate share of the
amount so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
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15.5.3. DELINQUENT BANKS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Bank that fails (i) to make available to the Agent its
PRO RATA share of any Loan or to purchase any Letter of Credit
Participation or (ii) to comply with the provisions of Section 14 with
respect to making dispositions and arrangements with the other Banks,
where such Bank's share of any payment received, whether by setoff or
otherwise, is in excess of its PRO RATA share of such payments due and
payable to all of the Banks, in each case as, when and to the full
extent required by the provisions of this Credit Agreement, shall be
deemed delinquent (a "DELINQUENT BANK") and shall be deemed a
Delinquent Bank until such time as such delinquency is satisfied. A
Delinquent Bank shall be deemed to have assigned any and all payments
due to it from the Borrower, whether on account of outstanding Loans,
Unpaid Reimbursement Obligations, interest, fees or otherwise, to the
remaining nondelinquent Banks for application to, and reduction of,
their respective PRO RATA shares of all outstanding Loans and Unpaid
Reimbursement Obligations. The Delinquent Bank hereby authorizes the
Agent to distribute such payments to the nondelinquent Banks in
proportion to their respective PRO RATA shares of all outstanding Loans
and Unpaid Reimbursement Obligations. A Delinquent Bank shall be deemed
to have satisfied in full a delinquency when and if, as a result of
application of the assigned payments to all outstanding Loans and
Unpaid Reimbursement Obligations of the nondelinquent Banks, the Banks'
respective PRO RATA shares of all outstanding Loans and Unpaid
Reimbursement Obligations have returned to those in effect immediately
prior to such delinquency and without giving effect to the nonpayment
causing such delinquency.
15.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any
Note or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
15.7. INDEMNITY. The Banks ratably agree hereby to indemnify and hold
harmless the Agent and its affiliates from and against any and all claims,
actions and suits (whether groundless or otherwise), losses, damages, costs,
expenses (including any expenses for which the Agent or such affiliate has not
been reimbursed by the Borrower as required by Section 16), and liabilities of
every nature and character arising out of or related to this Credit Agreement,
the Notes, or any of the other Loan Documents or the transactions contemplated
or evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly caused
by the Agent's willful misconduct or gross negligence.
15.8. AGENT AS BANK. In its individual capacity, Fleet shall have the
same obligations and the same rights, powers and privileges in respect to its
Commitment and the Loans made by it, and as the holder of any of the Notes
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and as the purchaser of any Letter of Credit Participations, as it would have
were it not also the Agent.
15.9. RESIGNATION. The Agent may resign at any time by giving sixty
(60) days prior written notice thereof to the Banks and the Borrower. Upon any
such resignation, the Majority Banks shall have the right to appoint a
successor Agent from among the Banks. Unless a Default or Event of Default
shall have occurred and be continuing, such successor Agent shall be
reasonably acceptable to the Borrower. If no successor Agent shall have been
so appointed by the Majority Banks and shall have accepted such appointment
within thirty (30) days after the retiring Agent's giving of notice of
resignation, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be any Bank or a financial institution having a
rating of not less than A or its equivalent by Standard & Poor's Corporation.
Upon the acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations hereunder.
After any retiring Agent's resignation, the provisions of this Credit
Agreement and the other Loan Documents shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Agent.
15.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Bank
hereby agrees that, upon learning of the existence of a Default or an Event of
Default, it shall promptly notify the Agent thereof. The Agent hereby agrees
that upon receipt of any notice under this Section 15.10 it shall promptly
notify the other Banks of the existence of such Default or Event of Default.
16. EXPENSES AND INDEMNIFICATION.
16.1. EXPENSES. The Borrower agrees to pay (i) the reasonable costs
of producing and reproducing this Credit Agreement, the other Loan Documents
and the other agreements and instruments mentioned herein, (ii) any taxes
(including any interest and penalties in respect thereto) payable by the Agent
or any of the Banks (other than taxes based upon the Agent's or any Bank's net
income) on or with respect to the transactions contemplated by this Credit
Agreement (the Borrower hereby agreeing to indemnify the Agent and each Bank
with respect thereto), (iii) the reasonable fees, expenses and disbursements
of the Agent's Special Counsel incurred in connection with the preparation,
syndication, administration or interpretation of the Loan Documents and other
instruments mentioned herein, each closing hereunder, any amendments,
modifications, approvals, consents or waivers hereto or hereunder, or the
cancellation of any Loan Document upon payment in full in cash of all of the
Obligations or pursuant to any terms of such Loan Document for providing for
such cancellation, (iv) the reasonable fees, expenses and disbursements of the
Agent or any of its affiliates incurred by the Agent or such affiliate in
connection with the preparation, syndication, administration or interpretation
of the Loan Documents and other instruments mentioned herein,
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and (v) all reasonable out-of-pocket expenses (including without limitation
reasonable attorneys' fees and costs, which attorneys may be employees of any
Bank or the Agent, and reasonable consulting, accounting, appraisal investment
banking and similar professional fees and charges) incurred by any Bank or the
Agent in connection with (A) the enforcement of or preservation of rights under
any of the Loan Documents against the Borrower or any of its Subsidiaries or the
administration thereof after the occurrence of a Default or Event of Default
and (B) any litigation, proceeding or dispute whether arising hereunder or
otherwise, in any way related to any Bank's or the Agent's relationship with
the Borrower or any of its Subsidiaries.
16.2. INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Agent, the Banks and their respective shareholders, directors,
agents, officers, subsidiaries and affiliates from and against any and all
claims, actions and suits whether groundless or otherwise, and from and
against any and all liabilities, losses, damages and expenses of every nature
and character arising out of this Credit Agreement or any of the other Loan
Documents or the transactions contemplated hereby including, without
limitation, (i) any actual or proposed use by the Borrower or any of its
Subsidiaries of the proceeds of any of the Loans or Letters of Credit, (ii)
the Borrower or any of its Subsidiaries entering into or performing this
Credit Agreement or any of the other Loan Documents, or (iii) with respect to
the Borrower and its Subsidiaries and their respective properties and assets,
the violation of any Environmental Law, the presence, disposal, escape,
seepage, leakage, spillage, discharge, emission, release or threatened release
of any Hazardous Substances or any action, suit, proceeding or investigation
brought or threatened with respect to any Hazardous Substances (including, but
not limited to, claims with respect to wrongful death, personal injury or
damage to property), in each case including, without limitation, the
reasonable fees and disbursements of counsel and allocated costs of internal
counsel incurred in connection with any such investigation, litigation or
other proceeding except to the extent that such claims, actions, suits,
liabilities, losses or damages arise solely as a result of the Agent or any
Bank's gross negligence or willful misconduct. In litigation, or the
preparation therefor, the Banks and the Agent and its affiliates shall be
entitled to select their own counsel and, in addition to the foregoing
indemnity, the Borrower agrees to pay promptly the reasonable fees and
expenses of such counsel. If, and to the extent that the obligations of the
Borrower under this Section 16.2 are unenforceable for any reason, the
Borrower hereby agrees to make the maximum contribution to the payment in
satisfaction of such obligations which is permissible under applicable law.
16.3. SURVIVAL. The covenants contained in this Section 16 shall
survive payment or satisfaction in full of all other Obligations.
17. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
17.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY. The Borrower
acknowledges that from time to time financial advisory, investment
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banking and other services may be offered or provided to the Borrower or one or
more of its Subsidiaries, in connection with this Credit Agreement or otherwise,
by a Section 20 Subsidiary. The Borrower, for itself and each of its
Subsidiaries, hereby authorizes (a) such Section 20 Subsidiary to share with the
Agent and each Bank any information delivered to such Section 20 Subsidiary by
the Borrower or any of its Subsidiaries, and (b) the Agent and each Bank to
share with such Section 20 Subsidiary any information delivered to the Agent or
such Bank by the Borrower or any of its Subsidiaries pursuant to this Credit
Agreement, or in connection with the decision of such Bank to enter into this
Credit Agreement; it being understood, in each case, that any such Section 20
Subsidiary receiving such information shall be bound by the confidentiality
provisions of this Credit Agreement. Such authorization shall survive the
payment and satisfaction in full of all of Obligations.
17.2. CONFIDENTIALITY. Each of the Banks and the Agent agrees, on
behalf of itself and each of its affiliates, directors, officers, employees
and representatives, including any Section 20 Subsidiary, to use reasonable
precautions to keep confidential, in accordance with their customary
procedures for handling confidential information of the same nature and in
accordance with safe and sound banking practices, any non-public information
supplied to it by the Borrower or any of its Subsidiaries pursuant to this
Credit Agreement or by any Section 20 Subsidiary, PROVIDED that nothing herein
shall limit the disclosure of any such information (a) after such information
shall have become public other than through a violation of this Section 17,
(b) to the extent required by statute, rule, regulation or judicial process,
(c) to counsel for any of the Banks or the Agent, (d) to bank examiners or any
other regulatory authority having jurisdiction over any Bank, the Agent,
Section 20 Subsidiary or to auditors or accountants, (e) to the Agent, any
Bank or any Section 20 Subsidiary, (f) in connection with any litigation to
which any one or more of the Banks, the Agent or any Section 20 Subsidiary is
a party, or in connection with the enforcement of rights or remedies hereunder
or under any other Loan Document, (g) to a Section 20 Subsidiary of such Bank
as provided in Section 17.1 or (h) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant
agrees to be bound by the provisions of Section 19.6.
17.3. PRIOR NOTIFICATION. Unless specifically prohibited by
applicable law or court order, each of the Banks and the Agent shall, prior to
disclosure thereof, notify the Borrower of any request for disclosure of any
such non-public information by any governmental agency or representative
thereof (other than any such request in connection with an examination of the
financial condition of such Bank by such governmental agency) or pursuant to
legal process.
17.4. OTHER. In no event shall any Bank or the Agent be obligated or
required to return any materials furnished to it or any Section 20 Subsidiary
by the Borrower or any of its Subsidiaries. The obligations of each Bank under
this Section 17 shall supersede and replace the obligations of such Bank under
any confidentiality letter in respect of this financing signed and delivered
by such Bank to the Borrower prior to the date hereof and shall be binding
upon any
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assignee of, or purchaser of any participation in, any interest in any of the
Loans or Reimbursement Obligations from any Bank.
18. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made
herein, in the Notes, in any of the other Loan Documents or in any documents
or other papers delivered by or on behalf of the Borrower or any of its
Subsidiaries pursuant hereto shall be deemed to have been relied upon by the
Banks and the Agent, notwithstanding any investigation heretofore or hereafter
made by any of them, and shall survive the making by the Banks of any of the
Loans and the issuance, extension or renewal of any Letters of Credit, as
herein contemplated, and shall continue in full force and effect so long as
any Letter of Credit or any amount due under this Credit Agreement or the
Notes or any of the other Loan Documents remains outstanding or any Bank has
any obligation to make any Loans or the Agent has any obligation to issue,
extend or renew any Letter of Credit, and for such further time as may be
otherwise expressly specified in this Credit Agreement. All statements
contained in any certificate or other paper delivered to any Bank or the Agent
at any time by or on behalf of the Borrower or any of its Subsidiaries
pursuant hereto or in connection with the transactions contemplated hereby
shall constitute representations and warranties by the Borrower or such
Subsidiary hereunder.
19. ASSIGNMENT AND PARTICIPATION.
19.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein,
each Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all
or a portion of its Commitment Percentage and Commitment and the same portion
of the Loans at the time owing to it, the Notes held by it and its
participating interest in the risk relating to any Letters of Credit);
PROVIDED that (i) each of the Agent and, unless a Default or Event of Default
shall have occurred and be continuing, the Borrower shall have given its prior
written consent to such assignment, which consent, in the case of each of the
Agent and the Borrower, will not be unreasonably withheld, (ii) each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Bank's rights and obligations under this Credit Agreement, (iii)
each assignment shall be in an amount that is a whole multiple of $500,000 and
in an amount not less than $5,000,000 or 100% of such assigning Bank's
remaining Commitment, and (iv) the parties to such assignment shall execute
and deliver to the Agent, for recording in the Register (as hereinafter
defined), an Assignment and Acceptance, substantially in the form of EXHIBIT H
hereto (an "Assignment and Acceptance"), together with any Notes subject to
such assignment. Upon such execution, delivery, acceptance and recording, from
and after the effective date specified in each Assignment and Acceptance,
which effective date shall be at least five (5) Business Days after the
execution thereof, (i) the assignee thereunder shall be a party hereto and, to
the extent provided in such Assignment and Acceptance, have the rights and
obligations of a Bank
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hereunder, and (ii) the assigning Bank shall, to the extent provided in such
assignment and upon payment to the Agent of the registration fee referred to
in Section 19.3, be released from its obligations under this Credit Agreement.
19.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other
parties hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto,
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of
the Borrower and its Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the
performance or observance by the Borrower and its Subsidiaries or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Credit Agreement or
any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of
this Credit Agreement, together with copies of the most recent
financial statements referred to in Section 7.4 and Section 8.4 and
such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into such
Assignment and Acceptance;
(d) such assignee will, independently and without reliance
upon the assigning Bank, the Agent or any other Bank and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking
action under this Credit Agreement;
(e) such assignee represents and warrants that it is an
Eligible Assignee;
(f) such assignee appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under
this Credit Agreement and the other Loan Documents as are delegated to
the
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Agent by the terms hereof or thereof, together with such powers as
are reasonably incidental thereto;
(g) such assignee agrees that it will perform in accordance
with their terms all of the obligations that by the terms of this
Credit Agreement are required to be performed by it as a Bank;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements
with the assigning Bank satisfactory to such assignee with respect to
its PRO RATA share of Letter of Credit Fees in respect of outstanding
Letters of Credit.
19.3. REGISTER. The Agent shall maintain a copy of each Assignment
and Acceptance delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Banks and the Commitment
Percentage of, and principal amount of the Loans owing to and Letter of Credit
Participations purchased by, the Banks from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Credit Agreement.
The Register shall be available for inspection by the Borrower and the Banks
at any reasonable time and from time to time upon reasonable prior notice.
Upon each such recordation, the assigning Bank agrees to pay to the Agent a
registration fee in the sum of $3,500.
19.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein
in the Register, and (ii) give prompt notice thereof to the Borrower and the
Banks (other than the assigning Bank). Within five (5) Business Days after
receipt of such notice, the Borrower, at its own expense, shall execute and
deliver to the Agent, in exchange for each surrendered Note, a new Note to the
order of such Eligible Assignee in an amount equal to the amount assumed by
such Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Bank has retained some portion of its obligations hereunder, a new
Note to the order of the assigning Bank in an amount equal to the amount
retained by it hereunder. Such new Notes shall provide that they are
replacements for the surrendered Notes, shall be in an aggregate principal
amount equal to the aggregate principal amount of the surrendered Notes, shall
be dated the effective date of such in Assignment and Acceptance and shall
otherwise be substantially the form of the assigned Notes. The surrendered
Notes shall be canceled and returned to the Borrower.
19.5. PARTICIPATIONS. Each Bank may sell participations to one or
more banks or other entities in all or a portion of such Bank's rights and
obligations
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under this Credit Agreement and the other Loan Documents; PROVIDED that (i)
each such participation shall be in an amount of not less than $5,000,000,
(ii) any such sale or participation shall not affect the rights and duties of
the selling Bank hereunder to the Borrower and (iii) the only rights granted
to the participant pursuant to such participation arrangements with respect to
waivers, amendments or modifications of the Loan Documents shall be the rights
to approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on any Loans, extend the term or increase the amount of
the Commitment of such Bank as it relates to such participant, reduce the amount
of any commitment fees or Letter of Credit Fees to which such participant is
entitled or extend any regularly scheduled payment date for principal or
interest.
19.6. DISCLOSURE. The Borrower agrees that in addition to disclosures
made in accordance with standard and customary banking practices any Bank may
disclose information obtained by such Bank pursuant to this Credit Agreement
to assignees or participants and potential assignees or participants
hereunder; PROVIDED that such assignees or participants or potential assignees
or participants shall agree (i) to treat in confidence such information unless
such information otherwise becomes public knowledge, (ii) to be bound by
Section 17, (iii) not to disclose such information to a third party, except as
required by law or legal process and (iv) not to make use of such information
for purposes of transactions unrelated to such contemplated assignment or
participation.
19.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Bank is an Affiliate of the Borrower, then any such assignee Bank
shall have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Agent pursuant to Section 15.1 or
Section 15.2, and the determination of the Majority Banks shall for all
purposes of this Credit Agreement and the other Loan Documents be made without
regard to such assignee Bank's interest in any of the Loans or Reimbursement
Obligations. If any Bank sells a participating interest in any of the Loans or
Reimbursement Obligations to a participant, and such participant is the
Borrower or an Affiliate of the Borrower, then such transferor Bank shall
promptly notify the Agent of the sale of such participation. A transferor Bank
shall have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Agent pursuant to Section 15.1 or Section
15.2 to the extent that such participation is beneficially owned by the
Borrower or any Affiliate of the Borrower, and the determination of the
Majority Banks shall for all purposes of this Credit Agreement and the other
Loan Documents be made without regard to the interest of such transferor Bank
in the Loans or Reimbursement Obligations to the extent of such participation.
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19.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank shall
retain its rights to be indemnified pursuant to Section 16.2 with respect to
any claims or actions arising prior to the date of such assignment. If any
assignee Bank is not incorporated under the laws of the United States of
America or any state thereof, it shall, prior to the date on which any
interest or fees are payable hereunder or under any of the other Loan
Documents for its account, deliver to the Borrower and the Agent certification
as to its exemption from deduction or withholding of any United States federal
income taxes. Anything contained in this Section 19 to the contrary
notwithstanding, any Bank may at any time pledge all or any portion of its
interest and rights under this Credit Agreement (including all or any portion
of its Notes) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the pledgor Bank from its obligations
hereunder or under any of the other Loan Documents.
19.9. ASSIGNMENT BY BORROWER. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Banks.
20. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent by overnight courier, or
sent by telegraph, telecopy, facsimile or telex and confirmed by delivery via
courier or postal service, addressed as follows:
(a) if to the Borrower, at Michaels Stores, Inc., 8000 Bent
Branch Drive, Irving, Texas 75063, Attention: Christopher J. Holland,
Vice President, and Mark Beasley, Esq., or at such other address for
notice as the Borrower shall last have furnished in writing to the
Person giving the notice;
(b) if to the Agent, at Fleet National Bank, 100 Federal
Street, Boston, Massachusetts 02110, USA, Attention: Judith Kelly,
Director, or such other address for notice as the Agent shall last have
furnished in writing to the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on
SCHEDULE 1 hereto, or such other address for notice as such Bank shall
last have furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier
or facsimile to a responsible officer of the party to which it is directed, at
the time of the receipt thereof by such officer or the sending of such
facsimile and (ii) if
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sent by registered or certified first-class mail, postage prepaid, on the third
Business Day following the mailing thereof.
21. GOVERNING LAW.
THIS CREDIT AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS ARE
CONTRACTS UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL FOR ALL PURPOSES
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID STATE OF NEW
YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH
SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SECTION
20. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS
BROUGHT IN AN INCONVENIENT COURT.
22. HEADINGS.
The captions in this Credit Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.
23. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of
which when executed and delivered shall be an original, and all of which
together shall constitute one instrument. In proving this Credit Agreement it
shall not be necessary to produce or account for more than one such
counterpart signed by the party against whom enforcement is sought. Delivery
by facsimile by any of the parties hereto of an executed counterpart hereof or
of any amendment or waiver hereto shall be as effective as an original
executed counterpart hereof or of such amendment or waiver and shall be
considered a representation that an original executed counterpart hereof or
such amendment or waiver, as the case may be, will be delivered.
24. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except
as provided in Section 26.
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25. WAIVER OF JURY TRIAL.
Each of the Borrower, the Banks and the Agent hereby waives its right
to a jury trial with respect to any action or claim arising out of any dispute
in connection with this Credit Agreement, the Notes or any of the other Loan
Documents, any rights or obligations hereunder or thereunder or the
performance of which rights and obligations. Except as prohibited by law, each
of the Borrower, the Banks and the Agent hereby waives any right it may have
to claim or recover in any litigation referred to in the preceding sentence
any special, exemplary, punitive or consequential damages or any damages other
than, or in addition to, actual damages. The Borrower (i) certifies that no
representative, agent or attorney of any Bank or the Agent has represented,
expressly or otherwise, that such Bank or the Agent would not, in the event of
litigation, seek to enforce the foregoing waivers and (ii) acknowledges that
the Agent and the Banks have been induced to enter into this Credit Agreement,
the other Loan Documents to which it is a party by, among other things, the
waivers and certifications contained herein.
26. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Credit
Agreement to be given by the Banks may be given, and any term of this Credit
Agreement, the other Loan Documents or any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower or any of its Subsidiaries of any terms of this Credit Agreement, the
other Loan Documents or such other instrument or the continuance of any
Default or Event of Default may be waived (either generally or in a particular
instance and either retroactively or prospectively) with, but only with, the
written consent of the Borrower and the written consent of the Majority Banks.
Notwithstanding the foregoing, the rate of interest on the Notes (other than
interest accruing pursuant to Section 5.11 following the effective date of any
waiver by the Majority Banks of the Default or Event oF Default relating
thereto), may not be decreased, the term of the Notes may not be extended, the
date fixed for any payment of principal and/or interest on the Notes may not
be extended, the amount of the Commitments of the Banks may not be increased,
the amount of principal owed may not be modified and the amount of commitment
fee, facility fee or Letter of Credit Fees or other fees due hereunder may not
be decreased or the date fixed for payment of any such fees may not be
deferred without the written consent of the Borrower and the written consent
of each Bank affected thereby; this Section 26 and the definition of Majority
Banks may not be amended without thE written consent of all of the Banks; and
the amount of the Agent's fees payable for the Agent's account and Section 15
may not be amended without the written consent of the Agent. No waiver shall
extend to or affect any obligation not expressly waived or impair any right
consequent thereon. No course of dealing or delay or omission on the part of
the Agent or any Bank in exercising any right shall operate as a waiver
thereof or otherwise be prejudicial thereto. No notice to or demand upon the
Borrower shall entitle the Borrower to other or further notice or demand in
similar or other circumstances.
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27. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or
in part in any jurisdiction, then such invalidity or unenforceability shall
affect only such clause or provision, or part thereof, in such jurisdiction,
and shall not in any manner affect such clause or provision in any other
jurisdiction, or any other clause or provision of this Credit Agreement in any
jurisdiction.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
MICHAELS STORES, INC.
By: /s/ Christopher J. Holland
-----------------------------------------------
Name: Christopher J. Holland
Title: Vice President - Finance
FLEET NATIONAL BANK, individually and as Agent
By: /s/ Judith C. E. Kelly
-----------------------------------------------
Name: Judith C. E. Kelly
Title: Director
WELLS FARGO BANK TEXAS, NATIONAL ASSOCIATION
By: /s/ Linda G. Davis
-----------------------------------------------
Name: Linda G. Davis
Title: Assistant Vice President
GUARANTY BANK
By: /s/ Robert S. Hays
-----------------------------------------------
Name: Robert S. Hays
Title: Senior Vice President
NATIONAL CITY BANK
By: /s/ Ralph A. Kaparos
-----------------------------------------------
Name: Ralph A. Kaparos
Title: Senior Vice President
FIRSTAR, N.A.
By: /s/ Stephen M. Reese
-----------------------------------------------
Name: Stephen M. Reese
Title: Senior Vice President
FIRST UNION NATIONAL BANK
By: /s/ Mark S. Supple
-----------------------------------------------
Name: Mark S. Supple
Title: Vice President
COMPASS BANK, an Alabama state bank
By: /s/ Key Coker
-----------------------------------------------
Name: Key Coker
Title: Executive Vice President
THE BANK OF NEW YORK
By: /s/ William M. Barnum
-----------------------------------------------
Name: William M. Barnum
Title: Vice President
SCHEDULE 1
BANKS; COMMITMENT PERCENTAGES
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BANK COMMITMENT
- -------------------------------------------------------------------------------
Fleet National Bank $45,000,000
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Wells Fargo Bank Texas, National Association
$40,000,000
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Guaranty Bank $25,000,000
- -------------------------------------------------------------------------------
National City Bank $25,000,000
- -------------------------------------------------------------------------------
Firstar, N.A. $20,000,000
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Compass Bank $15,000,000
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First Union National Bank $15,000,000
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The Bank of New York $15,000,000
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TOTAL $200,000,000
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