Exhibit 10.2
================================================================================
VISHAY INTERTECHNOLOGY, INC.
SECOND AMENDED AND RESTATED
LONG TERM REVOLVING CREDIT AGREEMENT
DATED AS OF JULY 31, 2003
COMERICA BANK,
AS CO-LEAD ARRANGER, CO-BOOK RUNNING MANAGER AND ADMINISTRATIVE AGENT,
FLEET SECURITIES, INC., AS CO-LEAD ARRANGER, CO-BOOK RUNNING MANAGER AND
SYNDICATION AGENT,
WACHOVIA BANK, NATIONAL ASSOCIATION, J.P. MORGAN AND
BANK OF AMERICA, N.A.,
AS DOCUMENTATION AGENTS
AND
BANK LEUMI USA, AS MANAGING AGENT
================================================================================
TABLE OF CONTENTS
Page
----
1. DEFINITIONS............................................................1
1.1 Certain Defined Terms............................................1
1.2 Euro............................................................26
2. REVOLVING CREDIT......................................................27
2.1 Commitment......................................................27
2.2 Accrual of Interest and Maturity; Evidence of Indebtedness......28
2.3 Requests for and Refundings and Conversions of Advances.........29
2.4 Disbursement of Advances........................................32
2.5 (a) Swing Line Advances.........................................34
2.6 Prime-based Interest Payments...................................41
2.7 Eurocurrency-based Interest Payments and Quoted Rate
Interest Payments...............................................41
2.8 Interest Payments on Conversions................................42
2.9 Interest on Default.............................................42
2.10 Prepayment......................................................43
2.11 Determination, Denomination and Redenomination of
Alternative Currency Advances...................................43
2.12 Prime-based Advance in Absence of Election or Upon Default......44
2.13 Revolving Credit Facility Fee...................................45
2.14 Currency Appreciation; Mandatory Reduction of Indebtedness......45
2.15 Optional Reduction or Termination of Revolving Credit
Aggregate Commitment............................................47
2.16 Extensions of Revolving Credit Maturity Date....................48
2.17 Application of Advances.........................................49
3. LETTERS OF CREDIT.....................................................50
3.1 Letters of Credit...............................................50
3.2 Conditions to Issuance..........................................50
3.3 Notice..........................................................52
3.4 Letter of Credit Fees...........................................52
3.5 Other Fees......................................................53
3.6 Drawings and Demands for Payment Under Letters of Credit........53
3.7 Obligations Irrevocable.........................................56
3.8 Risk Under Letters of Credit....................................57
3.9 Indemnification.................................................58
3.10 Right of Reimbursement..........................................59
3.11 Existing Letters of Credit......................................59
4. MARGIN ADJUSTMENTS....................................................59
4.1 Margin Adjustments..............................................59
4.2 Margins.........................................................60
i
5. CONDITIONS............................................................60
5.1 Execution of this Agreement and the other Loan Documents........60
5.2 Corporate Authority.............................................60
5.3 Collateral Documents and Guaranties.............................60
5.4 Representations and Warranties-- All Parties....................61
5.5 Compliance with Certain Documents and Agreements................61
5.6 Opinion of Counsel..............................................62
5.7 Company's Certificate...........................................62
5.8 Payment of Agent's and Other Fees...............................62
5.9 New Convertible Subordinated Debt...............................62
5.10 Other Documents and Instruments.................................62
5.11 Continuing Conditions...........................................62
6. REPRESENTATIONS AND WARRANTIES........................................63
6.1 Corporate Existence.............................................63
6.2 Due Authorization-- Company.....................................63
6.3 Due Authorization-- Significant Subsidiaries....................64
6.4 Title to Material Property......................................64
6.5 Encumbrances....................................................64
6.6 Subsidiaries....................................................64
6.7 Taxes...........................................................64
6.8 No Defaults.....................................................64
6.9 Compliance with Laws............................................65
6.10 Enforceability of Agreement and Loan Documents..................65
6.11 Non-contravention-- Company.....................................65
6.12 Non-contravention-- Other Parties...............................65
6.13 No Litigation-- Company.........................................66
6.14 No Litigation-- Other Parties...................................66
6.15 Consents, Approvals and Filings, Etc............................67
6.16 Agreements Affecting Financial Condition........................67
6.17 No Investment Company; No Margin Stock..........................67
6.18 ERISA...........................................................67
6.19 Environmental Matters and Safety Matters........................68
6.20 Accuracy of Information.........................................69
7. AFFIRMATIVE COVENANTS.................................................70
7.1 Preservation of Existence, Etc..................................70
7.2 Keeping of Books................................................70
7.3 Reporting Requirements..........................................70
7.4 Tangible Net Worth..............................................72
7.5 Leverage Ratio..................................................72
7.6 Fixed Charge Coverage Ratio.....................................72
7.7 Inspections.....................................................72
7.8 Taxes...........................................................73
7.9 Further Assurances..............................................73
7.10 Insurance.......................................................73
7.11 Indemnification.................................................73
ii
7.12 Governmental and Other Approvals................................74
7.13 Compliance with Contractual Obligations and Laws................74
7.14 ERISA...........................................................74
7.15 Environmental Matters...........................................75
7.16 Significant Subsidiaries........................................76
7.17 Foreign Subsidiaries Security...................................78
7.18 Siliconix.......................................................79
7.19 Security and Defense of Collateral..............................79
7.20 Vishay Israel...................................................79
7.21 Prepayment of General Semiconductor Notes.......................79
7.22 Use of Proceeds.................................................80
8. NEGATIVE COVENANTS....................................................80
8.1 Capital Structure, Business Objects or Purpose..................80
8.2 Limitations on Fundamental Changes..............................80
8.3 Guaranties......................................................82
8.4 Debt............................................................82
8.5 Liens...........................................................83
8.6 Dividends.......................................................84
8.7 Investments.....................................................84
8.8 Accounts Receivable.............................................86
8.9 Transactions with Affiliates....................................86
8.10 Operations of Vishay Israel.....................................87
8.11 Prohibition Against Certain Restrictions........................87
8.12 Amendment of the BCc Acquisition Documents......................87
8.13 Amendment of Subordinated Debt and Other Debt Documents and
Permitted Securitizations.......................................87
8.14 Payment or Prepayment of Other Debts............................88
9. DEFAULTS..............................................................88
9.1 Events of Default...............................................88
9.2 Exercise of Remedies............................................91
9.3 Rights Cumulative...............................................91
9.4 Waiver by Company and Permitted Borrowers of Certain Laws;
JURY WAIVER.....................................................91
9.5 Waiver of Defaults..............................................92
10. PAYMENTS, RECOVERIES AND COLLECTIONS..................................92
10.1 Payment Procedure...............................................92
10.2 Application of Proceeds.........................................94
10.3 Pro-rata Recovery...............................................94
10.4 Set Off.........................................................94
11. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS......................95
11.1 Reimbursement of Prepayment Costs...............................95
11.2 Eurocurrency Lending Office.....................................96
11.3 Availability of Alternative Currency............................96
iii
11.4 Refunding Advances in Same Currency.............................96
11.5 Circumstances Affecting Eurocurrency-based Rate Availability....96
11.6 Laws Affecting Eurocurrency-based Advance Availability..........97
11.7 Increased Cost of Eurocurrency-based Advances...................97
11.8 Indemnity.......................................................99
11.9 Judgment Currency...............................................99
11.10 Capital Adequacy and Other Increased Costs......................99
11.11 Substitution of Lenders........................................100
12. AGENTS...............................................................101
12.1 Appointment of Agent...........................................101
12.2 Deposit Account with Agent.....................................101
12.3 Exculpatory Provisions.........................................101
12.4 Successor Agent................................................102
12.5 Loans by Agent.................................................102
12.6 Credit Decisions...............................................102
12.7 Notices by Agent...............................................102
12.8 Agent's Fees...................................................103
12.9 Nature of Agency...............................................103
12.10 Authority of Agent to Enforce This Agreement...................103
12.11 Indemnification................................................103
12.12 Knowledge of Default...........................................104
12.13 Agent's Authorization; Action by Lenders.......................104
12.14 Enforcement Actions by the Agent...............................104
12.15 Collateral Matters.............................................105
12.16 Syndication Agent and Documentation Agents.....................105
13. MISCELLANEOUS........................................................106
13.1 Accounting Principles..........................................106
13.2 Consent to Jurisdiction........................................106
13.3 Law of Michigan................................................106
13.4 Interest.......................................................106
13.5 Closing Costs; Other Costs.....................................107
13.6 Notices........................................................107
13.7 Further Action.................................................108
13.8 Successors and Assigns; Assignments and Participations.........108
13.9 Indulgence.....................................................112
13.10 Counterparts...................................................112
13.11 Amendment and Waiver...........................................112
13.12 Taxes and Fees.................................................113
13.13 Confidentiality................................................113
13.14 Withholding Taxes..............................................114
13.15 ERISA Restrictions.............................................115
13.16 Effective Date.................................................116
13.17 Severability...................................................116
13.18 Table of Contents and Headings; Construction of Certain
Provisions.....................................................116
13.19 Independence of Covenants......................................116
iv
13.20 Reliance on and Survival of Various Provisions.................117
13.21 Lien Release and Revival.......................................117
13.22 Complete Agreement; Amendment and Restatements.................118
v
SCHEDULES
Schedule 1.1 - Percentages and Allowances
Schedule 1.4 - Existing Letters of Credit
Schedule 1.6 - Permitted Borrower Sublimit
Schedule 1.7 Syndication Agent Letters of Credit
Schedule 4.1 - Pricing Matrix
Schedule 5.3 - Jurisdictions to File Initial Financing Statements
Schedule 5.6 Legal Opinions
Schedule 6.6 - Subsidiaries
Schedule 6.6A - Significant Subsidiaries: Guarantors
Schedule 6.13 - Litigation - Company
Schedule 6.14 - Litigation - Other Parties
Schedule 6.19 Environmental Matters
Schedule 8.3 - Guaranties of Indebtedness
Schedule 8.4 Existing Debt
Schedule 8.5 - Existing Liens
Schedule 8.7 - Existing Investments
Schedule 8.13 Subordinated Debt
EXHIBITS
FORM OF REQUEST FOR REVOLVING CREDIT ADVANCE............................A-1
FORM OF REQUEST FOR SWING LINE ADVANCE..................................A-2
FORM OF REVOLVING CREDIT NOTE -- COMPANY................................B-1
FORM OF REVOLVING CREDIT NOTE -- PERMITTED BORROWERS....................B-2
FORM OF SWING LINE NOTE -- COMPANY......................................C-1
FORM OF SWING LINE NOTE -- PERMITTED BORROWERS..........................C-2
FORM OF COMPLIANCE CERTIFICATE..........................................D
FORM OF ASSIGNMENT AGREEMENT............................................E
FORM OF NOTICE OF LETTER OF CREDIT......................................F
FORM OF PERMITTED BORROWER ADDENDUM.....................................H
FORM OF SECURITY AGREEMENT..............................................I
FORM OF REAFFIRMATION OF LOAN DOCUMENTS.................................J
FORM OF REAFFIRMATION OF SECURITY AGREEMENT.............................K
vi
SECOND AMENDED AND RESTATED LONG TERM
REVOLVING CREDIT AGREEMENT
--------------------------
THIS SECOND AMENDED AND RESTATED LONG TERM REVOLVING CREDIT AGREEMENT
("Agreement") is made as of the 31st day of July, 2003 by and among the Lenders
(as defined below), Comerica Bank, as Co-Lead Arranger, Co-Book Running Manager
and Administrative Agent for the Lenders (in its capacity as Administrative
Agent, "Agent"), Fleet Securities, Inc., as Co-Lead Arranger, Co-Book Running
Manager and Syndication Agent (in its capacity as Syndication Agent,
"Syndication Agent"), Vishay Intertechnology, Inc., a Delaware corporation
("Company") and the Permitted Borrowers (as defined below and collectively with
the Company, the "Borrowers") from time to time signatory hereto.
RECITALS
A. Company has requested that the Lenders amend, renew and/or extend to it
and the Permitted Borrowers revolving credit and letters of credit as previously
extended to Company and the Permitted Borrowers under that certain Amended and
Restated Long Term Revolving Credit Agreement dated as of June 1, 1999, by and
among Company, Agent and the Lenders, as amended (the "Prior Credit Agreement")
on the terms and conditions set forth herein.
B. The Lenders are prepared to extend such credit, as aforesaid, by
amendment, restatement and renewal (but not in novation) of the Prior Credit
Agreement, but only upon the terms and conditions set forth in this Agreement.
NOW THEREFORE, COMPANY, PERMITTED BORROWERS, AGENT, AND THE LENDERS AGREE:
1. DEFINITIONS
1.1 Certain Defined Terms.
For the purposes of this Agreement the following terms will have the
following meanings:
"Account Party(ies)" shall mean, with respect to any Letter of Credit, the
account party or parties (which shall be Company and/or any Permitted Borrower
and/or any Significant Subsidiary which is not a Permitted Borrower hereunder
jointly and severally with the Company) as named in an application to the Agent
for the issuance of such Letter of Credit.
"Additional Debt Issuance Date" shall mean the date upon which the Company
issues the New Convertible Subordinated Debt.
"Advance(s)" shall mean, as the context may indicate, a borrowing
requested by Company or by a Permitted Borrower, and made by Lenders under
Section 2.1 of this Agreement, as the case may be, or requested by the Company
or by a Permitted Borrower and made by the Swing Line Bank under Section 2.5
hereof (including without limitation any
readvance, refunding or conversion of such borrowing pursuant to Section 2.3 or
2.5(c) hereof) and any advance in respect of a Letter of Credit under Section
3.6 hereof (including without limitation the unreimbursed amount of any draws
under Letters of Credit) and shall include, as applicable, a Eurocurrency-based
Advance, a Quoted Rate Advance, a Prime-based Advance and a Swing Line Advance.
"Affiliate" shall mean, with respect to any Person, any other Person or
group acting in concert in respect of the first Person that, directly or
indirectly, through one or more intermediaries, controls, or is controlled by,
or is under common control with such first Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to any
Person or group of Persons, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of management and policies of such
Person, whether through the ownership of voting securities or by contract or
otherwise.
"Agent" shall mean Comerica Bank, a Michigan banking corporation, acting
as administrative agent hereunder or any successor administrative agent
appointed in accordance with Section 12.4 hereof.
"Agents" shall mean Agent and Syndication Agent.
"Agent's Correspondent" shall mean for Advances in eurodollars, Agent's
Grand Cayman Branch (or for the account of said branch office, at Agent's main
office in Detroit, Michigan, United States); for Advances in other Alternative
Currencies, at such bank or banks as Agent may from time to time designate by
written notice to Company, the Permitted Borrowers and the Lenders.
"Agent's Fees" shall mean those fees and expenses required to be paid by
Company to Agent under Section 12.8 hereof.
"Alternate Base Rate" shall mean, for any day, an interest rate per annum
equal to the Federal Funds Effective Rate in effect on such day, plus one
percent (1%).
"Alternative Currency" shall mean each of the following currencies, as
applicable hereunder: the Euro, Japanese Yen ("(Y)") and British Pounds Sterling
("Sterling") and, subject to availability and to the terms and conditions of
this Agreement, such other freely convertible foreign currencies, as requested
by the Company or the Permitted Borrowers and acceptable to Agent and the
Lenders, in their reasonable discretion.
"Applicable Fee Percentage" shall mean, as of any date of determination
thereof, the applicable percentage used to calculate certain of the fees due and
payable hereunder, determined by reference to the appropriate columns in the
Pricing Matrix attached to this Agreement as Schedule 4.1.
"Applicable Interest Rate" shall mean the Eurocurrency-based Rate, the
Prime-based Rate or, with respect to Swing Line Advances, the Quoted Rate, as
selected by Company or a Permitted Borrower from time to time subject to the
terms and conditions of this Agreement.
2
"Applicable Margin" shall mean, as of any date of determination thereof,
the applicable interest rate margin, determined by reference to the appropriate
columns in the Pricing Matrix attached to this Agreement as Schedule 4.1.
"Arrangers' Fee" shall mean those certain fees payable to the Agents in
the amount set forth in the Fee Letter or such other fee letter as may be in
effect from time to time.
"Assignment Agreement" shall have the meaning ascribed to such term in
Section 13.8(c) hereof.
"Authorized Officer" shall mean the Chairman, any Vice Chairman,
President, Treasurer, CFO, or the Corporate Controller of the Company or any
applicable Subsidiary, as the case may be, or any person otherwise designated by
the Company or such Subsidiary, as the case may be, as having the authority to
act for the Company or such Subsidiary in the particular instance.
"BCc Acquisition" shall mean the acquisition by the Company, directly or
through its subsidiaries, of BCcomponents and its subsidiaries (and related
property and interests) pursuant, subject to the terms hereof, to the BCc
Acquisition Documents.
"BCc Acquisition Documents" shall mean the BCc Share Purchase Agreement,
together with all other related documents and instruments (including
conveyances) executed and delivered in connection with the BCc Acquisition, as
amended (subject to the terms hereof) from time to time.
"BCcomponents" shall mean BCcomponents Holdings B.V., a Dutch private
limited liability company.
"BCc Replacement Financing" shall mean the debt issued by the Company to
refinance the mezzanine debt issued by BCcomponents prior to the BCc
Acquisition.
"BCc Share Purchase Agreement" shall mean that certain Share Sale and
Purchase Agreement dated November 10, 2002 by and among the BCc Shareholders,
the Foundation, BCcomponents International BV (each such term being defined
therein), the Company and Vishay Europe, as amended (subject to the terms
hereof) from time to time.
"Borrowers" is defined in the preamble.
"Business Day" shall mean any day on which commercial banks are open for
domestic and international business (including dealings in foreign exchange) in
Detroit, London and New York, and if funds are to be paid or made available in
any Alternative Currency, on such day in the place where such funds are to be
paid or made available and, if the applicable Business Day relates to the
borrowing or payment of a Eurocurrency-based Advance denominated in Euros, on
which banks and foreign exchange markets are open for business in the city where
disbursements of or payments on such Advance are to be made which is a
Trans-European Business Day.
"Call Notices" shall have the meaning specified in Section 7.21 hereof.
3
"Capital Expenditures" shall mean, without duplication, any amounts paid
or accrued for a period in respect of any purchase or other acquisition for
value of fixed or capital assets net of the cash proceeds of any grant received
during such period by the Company or any of its Subsidiaries from the government
of Israel (or any agency or political subdivision thereof) under the Israeli
Capital Investment Act, up to the aggregate amount of capital additions in
Israel during such period; provided that, in no event shall Capital Expenditures
include amounts expended in respect of normal repair and maintenance of plant
facilities, machinery, fixtures and other like capital assets utilized in the
ordinary conduct of business (to the extent such amounts would not be
capitalized in preparing a balance sheet determined in accordance with GAAP).
"Collateral" shall mean all property or rights in which a security
interest, mortgage, lien or other encumbrance for the benefit of the Lenders is
or has been granted or arises or has arisen, under or in connection with this
Agreement, the other Loan Documents, or otherwise.
"Collateral Documents" shall mean the Security Agreements and the Pledge
Agreements, in each case as may be amended or otherwise modified from time to
time.
"Company" is defined in the Preamble.
"Consolidated" or "Consolidating" shall, when used with reference to any
financial information pertaining to (or when used as a part of any defined term
or statement pertaining to the financial condition of) Company and its
Subsidiaries mean the accounts of Company and its Subsidiaries determined on a
consolidated or consolidating basis, as the case may be, all determined as to
principles of consolidation and, except as otherwise specifically required by
the definition of such term or by such statements, as to such accounts, in
accordance with GAAP, applied on a consistent basis and consistent with the
financial statements, if any, as at and for the fiscal year ended December 31,
2002.
"Consolidated EBITDA" shall mean the EBITDA of the Company and its
Subsidiaries on a Consolidated basis.
"Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Covenant Compliance Report" shall mean the report to be furnished by the
Company to the Agent, substantially in the form attached hereto as Exhibit D, as
such exhibit may be amended or otherwise modified from time to time by the
Required Lenders, and certified by the chief financial officer of the Company
pursuant to Section 7.3(c), hereof, for the purpose of monitoring the Company's
and each Permitted Borrower's compliance herewith and to notify the Lenders of
the acquisition or creation of new Subsidiaries.
"Current Dollar Equivalent" shall mean, as of any applicable date of
determination, with respect to any Advance or Letter of Credit made, issued or
carried in an Alternative Currency, the amount of Dollars which is equivalent to
the then outstanding principal amount of such Advance or Letter of Credit at the
most favorable spot exchange rate determined by the Agent to be available to it
for the sale of Dollars for such Alternative Currency for delivery at
approximately 11:00 A.M. (Detroit time) two (2) Business Days after such date.
Alternative
4
Currency equivalents of Advances in Dollars (to the extent used herein) shall be
determined by Agent in a manner consistent herewith.
"Debt" shall mean, as of any applicable date of determination, all items
of indebtedness, obligation or liability of a Person, whether matured or
unmatured, liquidated or unliquidated, direct or indirect, absolute or
contingent, joint or several, that should be classified as liabilities on a
balance sheet and/or in accompanying footnotes in accordance with GAAP.
"Default" shall mean any event which, with the giving of notice or the
passage of time, or both, would constitute an Event of Default.
"Dollar Amount" shall mean (i) with respect to each Advance or Letter of
Credit made, issued or carried (or to be made, issued or carried) in Dollars,
the principal amount thereof and (ii) with respect to each Advance or Letter of
Credit made, issued or carried (or to be made or carried) in an Alternative
Currency, the amount of Dollars which is equivalent to the principal amount of
such Advance or Letter of Credit at the most favorable spot exchange rate
determined by the Agent to be available to it for the sale of Dollars for such
Alternative Currency at approximately 11:00 A.M. (Detroit time) two (2) Business
Days before such Advance or Letter of Credit is made or issued (or to be made or
issued), as such Dollar Amount may be adjusted from time to time pursuant to
Section 2.11 hereof. When used with respect to any Alternative Currency portion
of an Advance or Letter of Credit being repaid or remaining outstanding at any
time or with respect to any other sum expressed in an Alternative Currency,
"Dollar Amount" shall mean the amount of Dollars which is equivalent to the
principal amount of such Advance or Letter of Credit, or the amount so expressed
in such Alternative Currency, at the most favorable spot exchange rate
determined by the Agent to be available to it for the sale of Dollars for such
Alternative Currency at the relevant time. Alternative Currency amounts of
Advances made, carried or expressed in Dollars (to the extent used herein) shall
be determined by Agent in a manner consistent herewith.
"Dollars" and the sign "$" shall mean lawful money of the United States of
America.
"Domestic Advance" shall mean any Advance other than a Eurocurrency-based
Advance or any other Advance denominated in an Alternative Currency.
"Domestic Guaranty" shall mean that certain Amended and Restated Domestic
Guaranty delivered to Agent covering all Indebtedness outstanding from the
Company and the Permitted Borrowers executed and delivered as of the date hereof
(or to be executed and delivered by joinder) by the Company and each of the
Significant Domestic Subsidiaries, as amended or otherwise modified from time to
time.
"Domestic Permitted Borrower" shall mean any Permitted Borrower which is
not a Foreign Permitted Borrower.
"Domestic Subsidiary" shall mean any Subsidiary of the Company
incorporated or organized under the laws of the United States of America, or any
state or other political subdivision thereof or which is considered to be a
"disregarded entity" for purposes of Section 956 of the Internal Revenue Code,
in each case provided such Subsidiary is owned by the Company or a Domestic
Subsidiary; and "Domestic Subsidiaries" shall mean any or all of them.
5
"EBITDA" shall mean, of any Person, for any period, the Net Income of such
Person for such period adjusted (A) to include, if applicable, the Net Income of
any Person accrued during such period but prior to the date it became a
Subsidiary of the Company or was merged into or consolidated with the Company
(based on financial information reasonably satisfactory to the Agent), and (B)
to exclude, without duplication, the following items of income or expense to the
extent that such items are included in the calculation of such Net Income: (a)
Interest Expense, (b) any non-cash expenses and charges, (c) total income tax
expense, (d) depreciation expense, (e) the expense associated with amortization
of intangible and other assets, (f) non-cash provisions for reserves for
discontinued operations, (g) any extraordinary, unusual or non-recurring gains
or losses or charges or credits, (h) any gain or loss associated with the sale
or write-down of assets, (i) any gain or loss from or attributable to minority
interests and (j) any gain or loss accounted for by the equity method of
accounting (except in the case of income to the extent of the amount of cash
dividends or cash distributions paid to such Person or any Subsidiary of such
Person by the entity accounted for by the equity method of accounting).
"Effective Date" shall mean August 5, 2003, or such later date (but not
later than September 30, 2003) on which all of the conditions precedent set
forth in Sections 5.1 through 5.10 hereof have been satisfied, as confirmed in
writing by the Agent.
"EMU" shall mean Economic and Monetary Union as contemplated in the Treaty
on European Union.
"EMU Legislation" shall mean legislative measures of the European Council
(including European Council regulations) for the introduction of, changeover to
or operation of a single or unified European currency (whether known as the Euro
or otherwise), being in part the implementation of the third stage of EMU.
"Environmental Auditors" shall mean, when selected or retained by the
Company or the Agents, as the case may be hereunder, such counsel, engineering
or testing firms or other experienced, reputable environmental consultants
reasonably acceptable to the Required Lenders.
"Equity Offering" shall mean the issuance and sale for cash, on or after
the date hereof, by Company or any of its Subsidiaries of additional capital
stock or other equity interests.
"Equity Offering Adjustment" shall mean that amount to be added to the
minimum Tangible Net Worth required to be maintained under Section 7.4 hereof
consisting of an amount equal to seventy-five percent (75%) of each Equity
Offering conducted by the Company or any of its Subsidiaries, net of costs of
issuance, on and after July 1, 2003, on a cumulative basis; provided, however,
that in the case of each Equity Offering by a Subsidiary, the amount of the
Equity Offering Adjustment shall not exceed 75% of the amount, if any, by which
such Equity Offering increases Tangible Net Worth.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, or any successor act or code, and the regulations in effect from time
to time thereunder.
6
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) which is under common control with the Company within the meaning
of Section 4001 of ERISA or is part of a group which includes the Company and
would be treated as a single employer under Section 414 of the Internal Revenue
Code.
"Euro" or "Euro Unit" shall mean the currency unit of the Euro as defined
in the EMU Legislation.
"Eurocurrency Rate" shall mean with respect to each Eurocurrency-based
Advance carried in any Alternative Currency (and each Eurocurrency-Interest
Period pertaining thereto) the per annum interest rate determined by the Agent
(or, in case of Swing Line Advances, the Swing Line Bank) to be the offered rate
for deposits in such currency with a term comparable to such Interest Period
that appears on the applicable Telerate Page or the applicable British Bankers'
Association rate as reported by any generally recognized financial information
service, in each case as reported at approximately 11:00 a.m., London time, two
Business Days (or, in the case of a Eurocurrency-based Advance in Euros, on such
other date as is customary in the relevant offshore interbank market) prior to
the beginning of such Interest Period; provided, however, that if at any time
for any reason such offered rate for any such currency does not appear on a
Telerate Page or is not reported by any generally recognized financial
information service, "Eurocurrency Rate" shall mean, with respect to each such
Advance denominated in such currency, the per annum interest rate at which
deposits in the relevant currency are offered to Agent's Eurocurrency Lending
Office (or, in the case of Swing Line Advances, the Swing Line Bank's
Eurocurrency Lending Office) by other prime banks in the relevant offshore
interbank market in an amount comparable to the relevant Eurocurrency-based
Advance and for a period equal to the relevant Eurocurrency-Interest Period at
approximately 11:00 a.m. Detroit time two (2) Business Days prior to the first
day of such Eurocurrency-Interest Period.
"Eurocurrency-based Advance" shall mean any Advance (including a Swing
Line Advance) which bears interest at the Eurocurrency-based Rate.
"Eurocurrency-based Rate" shall mean a per annum interest rate which is
equal to the sum of the Applicable Margin (subject, if applicable, to adjustment
under Section 4.1 hereof), plus the quotient of:
(A) (a) in the case of Eurocurrency-based Advances carried
in Dollars, the Eurodollar Rate, or
(b) in the case of Eurocurrency-based Advances carried
in an Alternative Currency, the Eurocurrency Rate,
divided by
(B) a percentage equal to 100% minus the maximum rate on such
date at which Agent is required to maintain reserves on
`Eurocurrency Liabilities' as defined in and pursuant to
Regulation D of the Board of Governors of the Federal
Reserve System or, if such regulation or definition is
modified, and as long as Agent is required to maintain
reserves against a category of liabilities which
7
includes eurocurrency deposits or includes a category of
assets which includes eurocurrency loans, the rate at
which such reserves are required to be maintained on such
category,
all as conclusively determined by the Agent (absent manifest error), such sum to
be rounded upward, if necessary, to the nearest whole multiple of 1/100th of 1%.
"Eurocurrency-Interest Period" shall mean, (a) for Swing Line Advances
carried at the Eurocurrency-based Rate, an interest period of fourteen (14) days
or one month (or any lesser number of days agreed to in advance by Company or a
Permitted Borrower, Agent and the Swing Line Bank) and (b) for all other
Eurocurrency-based Advances, an interest period of one, two, three or six months
(or any lesser or greater number of days agreed to in advance by Company or a
Permitted Borrower, Agent and the Lenders) as selected by Company or such
Permitted Borrower, as applicable, for a Eurocurrency-based Advance pursuant to
Section 2.3 or 2.5 hereof, as the case may be.
"Eurocurrency Lending Office" shall mean, (a) with respect to the Agent,
Agent's office located at its Grand Caymans Branch or such other branch of
Agent, domestic or foreign, as it may hereafter designate as its Eurocurrency
Lending Office by written notice to Company, the Permitted Borrowers and the
Lenders and (b) as to each of the Lenders, its office, branch or affiliate
located at its address set forth on the signature pages hereof (or identified
thereon as its Eurocurrency Lending Office), or at such other office, branch or
affiliate of such Lender as it may hereafter designate as its Eurocurrency
Lending Office by written notice to Company and Agent.
"Eurodollar Rate" shall mean with respect to each Eurocurrency-based
Advance carried in Dollars (and each Eurocurrency-Interest Period pertaining
thereto) the per annum interest rate at which deposits in dollars are offered to
Agent's Eurocurrency Lending Office (or, in the case of Swing Line Advances, the
Swing Line Bank's Eurocurrency Lending Office) by other prime banks in the
eurocurrency market in an amount comparable to the relevant Eurocurrency-based
Advance and for a period equal to the relevant Eurocurrency-Interest Period at
approximately 11:00 a.m. Detroit time two (2) Business Days prior to the first
day of such Eurocurrency-Interest Period.
"Event of Default" shall mean any of the events specified in Section 9.1
hereof.
"Existing Letter of Credit" shall mean each letter of credit issued under
the Prior Credit Agreement, if any, which is outstanding on the Effective Date,
as set forth on Schedule 1.4 hereto.
"Federal Funds Effective Rate" shall mean, for any day, a fluctuating
interest rate per annum equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such transactions
received by Agent from three Federal funds brokers of recognized standing
selected by it.
8
"Fee Letter" shall mean the fee letter dated July 1, 2003 between the
Company and the Agent hereunder, as amended from time to time.
"Fees" shall mean the Agent's Fees, the Revolving Credit Facility Fee, the
Letter of Credit Fees, the Arrangers' Fee, and the other fees and charges
payable hereunder.
"Fixed Charge Coverage Ratio" shall mean, with respect to the Company and
its Consolidated Subsidiaries, as of any date of determination, a ratio, (i) the
numerator of which shall be equal to Consolidated EBITDA for the preceding four
fiscal quarters ending on the date of determination, minus Capital Expenditures
during such period and (ii) the denominator of which shall be the Interest
Expense of the Company and its Consolidated Subsidiaries for such period, in
each case determined in accordance with GAAP.
"Foreign Guaranty" shall mean that certain Foreign Guaranty dated March 2,
1998 covering all Indebtedness of the Foreign Permitted Borrowers hereunder (but
expressly excluding any Hedging Obligations) previously executed and delivered
(or to be executed and delivered by joinder) by the Significant Foreign
Subsidiaries as amended or otherwise modified from time to time.
"Foreign Permitted Borrower" shall mean any Permitted Borrower hereunder
which is a Foreign Subsidiary.
"Foreign Subsidiary" shall mean any of the Company's Subsidiaries, other
than a Domestic Subsidiary; and "Foreign Subsidiaries" shall mean any or all of
them.
"FPB Advance Notice" shall mean notice from the Company or the applicable
Foreign Permitted Borrower that such Foreign Permitted Borrower intends to
submit a Request for Advance (or for the issuance of a Letter of Credit) under
this Agreement.
"GAAP" shall mean generally accepted accounting principles in the United
States of America, as in effect from time to time, consistently applied.
"Governmental Obligations" means noncallable direct general obligations of
the United States of America or obligations the payment of principal of and
interest on which is unconditionally guaranteed by the United States of America.
"Granting Lender" shall mean a Lender which elects to grant to an SPFV the
option to fund all or any part of any Advance that such Lender would otherwise
be obligated to fund pursuant to this Agreement, in each case in accordance with
Section 13.8(c) hereof; provided, however, that notwithstanding the funding by
an SPFV of an Advance (or a portion thereof) hereunder, the Granting Lender
shall retain all of its rights and obligations under this Agreement with respect
to such Advance or otherwise.
"Guarantee Obligation" shall mean as to any Person (the "guaranteeing
person") any obligation of the guaranteeing person in respect of any obligation
of another Person (including, without limitation, any bank under any letter of
credit), the creation of which was induced by a reimbursement agreement,
guaranty agreement, keepwell agreement, purchase agreement, counterindemnity or
similar obligation issued by the guaranteeing person, in either case
9
guaranteeing or in effect guaranteeing any Debt, leases, dividends or other
obligations (the "primary obligations") of any other third Person (the "primary
obligor") in any manner, whether directly or indirectly, including, without
limitation, any obligation of the guaranteeing person, whether or not
contingent, (i) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (1) for the purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to purchase
property, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation or (iv) otherwise to assure or hold harmless
the owner of any such primary obligation against loss in respect thereof;
provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
maximum reasonably anticipated liability in respect thereof as determined by the
Company or Subsidiary, as applicable, in good faith.
"Guaranties" shall mean the Domestic Guaranty and the Foreign Guaranty,
and "Guaranty" shall mean any or all of them.
"Guarantor(s)" shall mean each Significant Subsidiary which is required by
the Lenders to guarantee the obligations of the Company and/or the Permitted
Borrowers hereunder and under the other Loan Documents.
"Hazardous Material" shall mean and include any hazardous, toxic or
dangerous waste, substance or material defined as such in (or for purposes of)
the Hazardous Material Laws.
"Hazardous Material Law(s)" shall mean all laws, codes, ordinances, rules,
regulations, orders, decrees and directives issued by any federal, state,
provincial, local, foreign or other governmental or quasi-governmental authority
or body (or any agency, instrumentality or political subdivision thereof)
pertaining to Hazardous Material on or about any facilities owned, leased or
operated by Company or any of its Subsidiaries, or any portion thereof
including, without limitation, those relating to soil, surface, subsurface
ground water conditions and the condition of the ambient air; and any state and
local laws and regulations pertaining to Hazardous Material and/or asbestos; any
so-called "superfund" or "superlien" law; and any other federal, state,
provincial, foreign or local statute, law, ordinance, code, rule, regulation,
order or decree regulating, relating to, or imposing liability or standards of
conduct concerning, any hazardous, toxic or dangerous waste, substance or
material, as now or at any time hereafter in effect.
"Hedging Obligation(s)" shall mean Interest Rate Protection Agreements and
any foreign currency exchange agreements (including without limitation foreign
currency hedges and swaps)
10
or other foreign exchange transactions, or any combination of such transactions
or agreements or any option with respect to any such transactions or agreements
entered into between Company and/or any of its Subsidiaries and a Lender or an
Affiliate of a Lender to manage existing or anticipated foreign exchange risk
and not for speculative purposes.
"Hereof", "hereto", "hereunder" and similar terms shall refer to this
Agreement in its entirety and not to any particular paragraph or provision of
this Agreement.
"Indebtedness" shall mean all indebtedness and liabilities whether direct
or indirect, absolute or contingent, owing by Company or any of the Permitted
Borrowers to the Lenders (or any of them) or to the Agent, in any manner and at
any time, under this Agreement or the Loan Documents, due or hereafter to become
due, now owing or that may hereafter be incurred by the Company, any of the
Permitted Borrowers or any of the Subsidiaries to, or acquired by, the Lenders
(or any of them) or by Agent, and all net obligations with respect to Hedging
Obligations entered into between Company and/or any of its Subsidiaries and a
Lender or an Affiliate of a Lender, any Special Letters of Credit, and any
judgments that may hereafter be rendered on such indebtedness or any part
thereof, with interest according to the rates and terms specified, or as
provided by law, and any and all consolidations, amendments, renewals,
replacements or extensions of any of the foregoing. For the purposes of Section
9.2(b), "Indebtedness" shall exclude any Hedging Obligations.
"Intercompany Loan" shall mean any loan (or advance in the nature of a
loan) by the Company or any Subsidiary to the Company or any Subsidiary,
provided that each such loan or advance to the Company or to a Subsidiary that
is an obligor on the Indebtedness shall be subordinated in right of payment and
priority to the Indebtedness of the Company or such Subsidiary, as applicable,
on terms and conditions satisfactory to Agent and the Required Lenders.
"Intercompany Loans, Advances or Investments" shall mean any Intercompany
Loan, and any advance or investment by the Company or any Subsidiary (including
without limitation any guaranty of obligations or indebtedness to third parties)
to or in the Company or any Subsidiary.
"Intercompany Notes" shall mean the promissory notes issued or to be
issued by any Subsidiary to Company or to any Significant Domestic Subsidiary to
evidence an Intercompany Loan.
"Interest Expense" shall mean, for any Person and with respect to any
period, the sum of the amount of interest paid or accrued in respect of such
period, determined in accordance with GAAP.
"Interest Period" shall mean (a) with respect to a Eurocurrency-based
Advance, a Eurocurrency-Interest Period commencing on the day a
Eurocurrency-based Advance is made, or on the effective date of an election of
the Eurocurrency-based Rate made under Section 2.3 hereof, as the case may be,
and (b) with respect to a Swing Line Advance carried at the Quoted Rate, an
interest period of one month (or any lesser number of days agreed to in advance
by Company or a Permitted Borrower, Agent and the Swing Line Bank); provided,
however that (i)
11
any Interest Period which would otherwise end on a day which is not a Business
Day shall end on the next succeeding Business Day, except that as to a
Eurocurrency-Interest Period, if the next succeeding Business Day falls in
another calendar month, such Eurocurrency-Interest Period shall end on the next
preceding Business Day, and (ii) when a Eurocurrency-Interest Period begins on a
day which has no numerically corresponding day in the calendar month during
which such Eurocurrency-Interest Period is to end, it shall end on the last
Business Day of such calendar month, and (iii) no Interest Period shall extend
beyond the Revolving Credit Maturity Date.
"Interest Rate Protection Agreement(s)" shall mean any interest rate,
swap, cap, floor, collar, forward rate agreement or other rate protection
transaction, or any combination of such transactions or agreements or any option
with respect to any such transactions or agreements now existing or hereafter
entered into by Company or any of its Subsidiaries to manage existing or
anticipated interest rate risk and not for speculative purposes.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated thereunder.
"Investment" shall mean any loan or advance by Company or any of its
Subsidiaries to, or any other loan, advance or investment by Company or any of
its Subsidiaries in, any Person (including without limitation, the Company or
any Subsidiary), without offset, reduction or other adjustment, whether such
loan, advance or investment shall be in the nature of an investment in shares of
stock or other capital or securities, general or limited partnership, limited
liability company or joint venture interests, evidences of indebtedness or
otherwise.
"Issuing Office" shall mean Agent's office located at One Detroit Center,
500 Woodward Avenue, Detroit, Michigan 48275 or such other office as Agent shall
designate in writing as its Issuing Office.
"Joinder Agreement" shall mean a joinder agreement in the form attached as
Exhibit A to the form of the Domestic Guaranty or to the form of the Foreign
Guaranty, to be executed and delivered by any Person required to be a Guarantor
pursuant to Section 7.16 of this Agreement.
"Joint Venture" shall mean any corporation, partnership, association,
joint stock company, limited liability company, partnership, business trust or
other combined enterprise, other than a Subsidiary, in which (or to which) the
Company or any of its Subsidiaries has made a loan, investment or advance or has
an ownership stake or interest, whether in the nature of Share Capital or
otherwise (but expressly excluding Permitted Investments) to fund a business
enterprise.
"Lender(s)" shall mean each of the Lenders signatory to this Agreement and
any assignee which becomes a Lender pursuant to Section 13.8(c) hereof, and
shall include, as applicable, the Swing Line Bank.
"Letter(s) of Credit" shall mean any standby letters of credit issued by
Agent at the request of or for the account of an Account Party or Account
Parties pursuant to Article 3 hereof, including without limitation any Existing
Letters of Credit.
12
"Letter of Credit Agreement" shall mean, in respect of each Letter of
Credit, the application and related documentation satisfactory to the Agent of
an Account Party or Account Parties requesting Agent to issue such Letter of
Credit, as amended from time to time.
"Letter of Credit Fees" shall mean the fees payable to Agent for the
accounts of the Lenders in connection with Letters of Credit pursuant to Section
3.4 hereof.
"Letter of Credit Maximum Amount" shall mean, as of any date of
determination, the lesser of: (a) One Hundred Million Dollars ($100,000,000) and
(b) the Revolving Credit Aggregate Commitment as of such date, minus the
aggregate principal amount of Advances outstanding as of such date under the
Revolving Credit and under the Swing Line, minus, in each case the Letter of
Credit Reserve in effect on such date.
"Letter of Credit Obligation(s)" shall mean the obligation of an Account
Party or Account Parties under this Agreement and each Letter of Credit
Agreement to reimburse the Agent for each payment made by the Agent under the
Letter of Credit issued pursuant to such Letter of Credit Agreement, together
with all other sums, fees, charges and amounts which may be owing to the Agent
under such Letter of Credit Agreement.
"Letter of Credit Payment" shall mean any amount paid or required to be
paid by the Agent in its capacity hereunder as issuer of a Letter of Credit as a
result of a draft or other demand for payment under any Letter of Credit.
"Letter of Credit Reserve" shall mean Five Million Dollars ($5,000,000),
as decreased by the Company with the Agent's approval.
"Leverage Ratio" shall mean, as of any date of determination, with respect
to the Company and its Consolidated Subsidiaries, the ratio of (a) Total Debt as
of such date to (b) Consolidated EBITDA for the four consecutive fiscal quarters
then ending.
"Lien" shall mean any pledge, assignment, hypothecation, mortgage,
security interest, deposit arrangement, option, trust receipt, conditional sale
or title retaining contract, sale and leaseback transaction, or any other type
of lien, charge or encumbrance, whether based on common law, statute or
contract.
"Loan Documents" shall mean collectively, this Agreement, the Letter of
Credit Agreements, the Guaranties, the Collateral Documents, Hedging Obligations
entered into between Company and/or any of its Subsidiaries and a Lender or an
Affiliate of a Lender, and any other documents, instruments or agreements
executed pursuant to or in connection with any such document, the Indebtedness
or this Agreement as such documents may be amended or otherwise modified from
time to time. For the purposes of Section 13.11, "Loan Documents" shall exclude
any Hedging Obligations.
"LYONs" shall mean the Liquid Yield Option Notes (LYONs)TM issued under
and pursuant to that certain Indenture dated as of June 4, 2001 between The Bank
of New York, as trustee, and the Company, as issuer.
13
"LYONs Reserve" shall mean zero, until the Additional Debt Issuance Date,
whereupon the LYONs Reserve shall mean One Hundred Sixty Million Dollars
($160,000,000), such reserve being reduced from time to time (but not below
zero) by twice the accreted amount of the LYONs that the Company prepays,
purchases, redeems or defeases from and after the Agent's consent to the
issuance of the New Convertible Subordinated Debt dated July 29, 2003 issued
under the Prior Credit Agreement, or that is converted into shares of the
Company's common stock, any such reductions of the LYONs Reserve becoming
effective on the date the Agent receives written evidence, satisfactory in form
and substance to the Agent, of such prepayment, purchase, redemption, defeasance
or conversion of the LYONs.
"Moody's" means Moody's Investors Service, Inc., its successors and
assigns, and, if such organization shall be dissolved or liquidated or shall no
longer perform the functions of a securities rating agency, "Moody's" shall be
deemed to refer to any other nationally recognized securities rating agency
designated by the Agent.
"Multiemployer Plan" shall mean any multiemployer plan within the meaning
of Section 4001(a)(3) of ERISA.
"National Currency Unit" shall mean a fraction or multiple of one Euro
Unit expressed in units of the former national currency of a Participating
Member State.
"Net Income" shall mean the net income (or loss) of a Person for any
period determined in accordance with GAAP.
"Net Income Adjustment" shall mean that amount to be added to the minimum
Tangible Net Worth required to be maintained under Section 7.4 hereof consisting
of fifty percent (50%) of Company's Consolidated Net Income for each of the
Company's fiscal quarters ending on or after September 30, 2003 (in each case,
only if a positive number), on a cumulative basis.
"New Convertible Subordinated Debt" means that certain new convertible
subordinated Debt of the Company in the amount of up to $500,000,000 to be
issued by the Company under an Indenture to be dated as of August 6, 2003
between the Company and Wachovia Bank, National Association, as Trustee on
substantially the terms and conditions contained in the Company's Offering
Memorandum relating to such debt dated July 31, 2003 (as determined in the
reasonable discretion of the Agent and confirmed by the Agent to the Company).
"Notes" shall mean the Revolving Credit Notes or the Swing Line Notes, or
any or all of the Revolving Credit Notes and the Swing Line Notes as the context
indicates, and in the absence of such indication, all such notes.
"Participating Member State" shall mean such country so described in any
EMU Legislation.
"PBGC" shall mean the Pension Benefit Guaranty Corporation under ERISA, or
any successor corporation.
14
"PDD Restructuring" shall mean that certain reorganization and
restructuring of the Company's power diodes division, to the extent consummated
on substantially the terms described in documentation delivered by the Company
to the Agent on July 30, 2003.
"Pension Plan" shall mean each employee pension benefit plan, as defined
in Section 3(2) of ERISA, of the Company or an ERISA Affiliate but only to the
extent such Pension Plan is subject to ERISA, as provided in Section 4 of ERISA,
and is subject to Section 412 of the Internal Revenue Code and Section 302 of
ERISA other than a Multiemployer Plan.
"Percentage" shall mean, with respect to any Lender, its percentage share,
as set forth on Schedule 1.1 hereto, of the Letters of Credit or the Revolving
Credit, as the context indicates, as such Schedule may be revised from time to
time by Agent in accordance with Section 13.8(d) hereof.
"Permitted Acquisition" shall mean any acquisition by the Company or any
of its Subsidiaries of assets, businesses or business interests or shares of
stock or other ownership interests of or in any Person, conducted while no
Default or Event of Default has occurred and is continuing hereunder (both
before and after giving effect thereto) in accordance with the following
requirements:
(a) Such acquisition is of a business or Person primarily engaged in a
line of business in which the Company or any Subsidiary is permitted
to engage under Section 8.1(b) hereof;
(b) The board of directors (or other Person(s) exercising similar
functions) of the seller of the assets or issuer of the shares of
stock or other ownership interests being acquired shall have
approved such transaction or recommended that such transaction be
approved;
(c) in the event that the value of such proposed new acquisition,
computed on the basis of total acquisition consideration paid or
incurred, or to be paid or incurred, by the Company or its
Subsidiaries with respect thereto, including all indebtedness which
is assumed or to which such assets, businesses or business or
ownership interests or shares, or any Person so acquired, is
subject, but excluding the value of any common shares transferred as
a part of such acquisition, shall be
(i) greater than or equal to Fifty Million Dollars ($50,000,000),
determined as of the date of such acquisition, then not less
than fifteen (15) nor more than ninety (90) days prior to the
date each such proposed acquisition is scheduled to be
consummated, the Company provides written notice thereof to
Agent, accompanied by (A) the term sheet, purchase agreement
and, when available, drafts of all material documents
pertaining to such proposed acquisition, (B) historical
financial information (including, but not limited to, income
statements, balance sheets and cash flows) covering either the
three most recent complete fiscal years of the acquisition
target prior to the effective date of the acquisition or the
entire credit history of the acquisition target, whichever
period is shorter, and the quarterly
15
financial statements of the acquisition target for the most
recent eight consecutive fiscal quarters (provided however
that, if the financial information referred to in this
subparagraph (B) is not available, Company shall furnish Agent
with financial information otherwise reasonably satisfactory
to the Required Lenders) and (C) Pro Forma Projected Financial
Information, or
(ii) less than Fifty Million Dollars ($50,000,000) but greater than
or equal to Ten Million Dollars ($10,000,000), then not less
than ten (10) Business Days after date each such proposed
acquisition has been consummated, the Company provides written
notice thereof to Agent (with certified copies of all material
documents pertaining to such acquisition);
whereupon Agent shall promptly upon its receipt thereof distribute copies of all
notices and other materials received from Company under this clause (c) to each
Lender; and
(d) within thirty (30) days after any such acquisition has been
completed, the Company, its Subsidiaries and any of the other
business entities involved in such acquisition shall execute or
cause to be executed, and provide or cause to be provided to Agent,
any Loan Documents required under Section 7.16 hereof.
"Permitted Borrower Addendum" shall mean an addendum substantially in the
form attached hereto as Exhibit H, to be executed and delivered by each
Permitted Borrower which becomes a party to this Agreement after the date
hereof, as such Exhibit may be amended from time to time.
"Permitted Borrower Sublimit" shall mean the maximum aggregate amount of
Advances and Letters of Credit (including Letter of Credit Obligations)
available at any time to each of the Permitted Borrowers hereunder, as set forth
on Schedule 1.6 hereof.
"Permitted Borrower(s)" shall mean Vishay Europe and Vishay Electronic,
together with each of Vishay Asia and Siliconix (but solely upon each of Vishay
Asia's and Siliconix's compliance with the requirements set forth in Section 2.1
hereof), and any 100% Subsidiary which, after the Effective Date and with the
prior written approval of the Lenders, becomes a party hereto pursuant to the
requirements of Section 2.1 hereof.
"Permitted Company Encumbrances" shall mean, in addition to Permitted
Encumbrances, those liens and encumbrances of the Company identified in Schedule
8.5, hereto.
"Permitted Currencies" shall mean Dollars or any Alternative Currency.
"Permitted Encumbrances" shall mean, with respect to any Person:
(e) liens for taxes not yet due and payable or which are being contested
in good faith by appropriate proceedings diligently pursued,
provided that such provision for the payment of all such taxes known
to such Person has been made on the books of such Person as may be
required by GAAP;
16
(b) mechanics', materialmen's, bankers', carriers', warehousemen's and
similar liens and encumbrances arising in the ordinary course of
business and securing obligations of such Person that are not
overdue for a period of more than 60 days or are being contested in
good faith by appropriate proceedings diligently pursued, provided
that in the case of any such contest (i) any proceedings commenced
for the enforcement of such liens and encumbrances shall have been
duly suspended; and (ii) such provision for the payment of such
liens and encumbrances has been made on the books of such Person as
may be required by GAAP;
(c) liens arising in connection with worker's compensation, unemployment
insurance, old age pensions (subject to the applicable provisions of
this Agreement) and social security benefits which are not overdue
or are being contested in good faith by appropriate proceedings
diligently pursued, provided that in the case of any such contest
(i) any proceedings commenced for the enforcement of such liens
shall have been duly suspended; and (ii) such provision for the
payment of such liens has been made on the books of such Person as
may be required by GAAP;
(d) (i) liens incurred in the ordinary course of business to secure the
performance of statutory obligations arising in connection with
progress payments or advance payments due under contracts with the
United States or any foreign government or any agency thereof
entered into in the ordinary course of business and (ii) liens
incurred or deposits made in the ordinary course of business to
secure the performance of statutory obligations, bids, leases, fee
and expense arrangements with trustees and fiscal agents and other
similar obligations (exclusive of obligations incurred in connection
with the borrowing of money, any lease-purchase arrangements or the
payment of the deferred purchase price of property), provided that
full provision for the payment of all such obligations set forth in
clauses (i) and (ii) has been made on the books of such Person as
may be required by GAAP; and
(e) any minor imperfections of title, including but not limited to
easements, covenants, rights-of-way or other similar restrictions,
which, either individually or in the aggregate do not materially
adversely affect the present or future use of the property to which
they relate, which would have a material adverse effect on the sale
or lease of such property, or which would render title thereto
unmarketable.
"Permitted Encumbrances of the Subsidiaries" shall mean, in addition to
Permitted Encumbrances, those liens and encumbrances of the Subsidiaries
identified in Schedule 8.5, hereto.
"Permitted Investments" shall mean:
(a) Governmental Obligations;
(b) Obligations of a state of the United States, the District of
Columbia or any possession of the United States, or any political
subdivision thereof, which are
17
described in Section 103(a) of the Internal Revenue Code and are
rated in any of the highest 3 major rating categories as determined
by at least one nationally recognized Rating Agency; or secured, as
to payments of principal and interest, by a letter of credit
provided by a financial institution or insurance provided by a bond
insurance company which itself or its debt is rated in the highest 3
major rating categories as determined by at least one Rating Agency;
(c) Banker's acceptances, commercial accounts, certificates of deposit,
or depository receipts issued by a bank, trust company, savings and
loan association, savings bank or other financial institution whose
deposits are insured by the Federal Deposit Insurance Corporation
and whose reported capital and surplus equal at least $500,000,000;
(d) commercial paper with a minimum rating of "A-1" (or better) by S&P
or "P-1" (or better) by Moody's, full faith and credit direct
obligations of the United States of America or, with respect to the
Foreign Subsidiaries, of the central government of the applicable
jurisdiction, or any agency thereof, certificates of deposit, and
other short term investments (each of a duration of one year or
less), maintained by the Company or any of its Subsidiaries
consistent with the present investment practices of such parties (as
classified in the current financial statements of such parties);
(e) Secured repurchase agreements against obligations itemized in
paragraph (a) above, and executed by a bank or trust company or by
members of the association of primary dealers or other recognized
dealers in United States government securities, the market value of
which must be maintained at levels at least equal to the amounts
advanced and repurchase agreements entered into with counterparties
having ratings in either of the highest two rating categories by
Moody's or S&P, or the highest rating category by Fitch Investor
Services, Duff & Phelps or Thompson Bank Watch and providing for
underlying securities to be held by a third party;
(f) Any fund or other pooling arrangement which exclusively purchases
and holds the investments itemized in (a) through (e) above; and
(g) other short term investments (excluding investments in Subsidiaries,
Affiliates or Joint Ventures) made or maintained by any Foreign
Subsidiary outside of the United States of America in the ordinary
course of its business, consistent with the present investment
practices of the Company and its Subsidiaries as of the date hereof
(generally, and as to the individual and aggregate amounts and other
terms thereof).
"Permitted Securitization" shall mean the transfer or encumbrance of
certain foreign accounts receivable by any of the Foreign Subsidiaries to a
Special Purpose Subsidiary conducted in accordance with the following
requirements:
18
(a) The disposition of foreign accounts receivable will not result in
the aggregate principal amount of Debt at any time issued and
outstanding in respect of Permitted Securitizations being in excess
of Two Hundred Million Dollars ($200,000,000) in aggregate while the
Indebtedness remains outstanding;
(b) The Foreign Subsidiary disposing of foreign accounts receivable to a
Special Purpose Subsidiary pursuant to such Permitted Securitization
shall itself actually receive (substantially contemporaneously with
such disposition) cash in connection with any such Securitization
Transaction in an amount based on normal and customary advance rates
(and taking into account typical deductions for market-based,
arms-length Securitization Transactions);
(c) Each such disposition shall be without recourse to the Company or
its Domestic Subsidiaries and otherwise on normal and customary
terms and conditions for comparable asset-based Securitization
Transactions;
(d) Each such Securitization Transaction shall be structured on the
basis of the issuance of non-recourse (to the Company or its
Domestic Subsidiaries) Debt or other similar securities by a Special
Purpose Subsidiary;
(e) Both immediately before and immediately after each such disposition,
no Default or Event of Default (whether or not related to such
disposition) shall have occurred and be continuing; and
(f) Immediately prior to and immediately after conducting each such
Securitization Transaction, Company must have on its rated Senior
Debt a BB+ or better rating from S&P and a Ba1 rating or better from
Moody's.
"Permitted Transfer" shall mean (i) any disposition of inventory or worn
out or obsolete machinery, equipment or other such personal property in the
ordinary course of business, (ii) the transfer by Company or its Subsidiaries to
Vishay Israel or its wholly-owned direct subsidiaries existing under the laws of
Israel of machinery and equipment in an aggregate amount (valued on the basis of
the book value of such property on the date of transfer thereof) of up to Fifty
Million Dollars ($50,000,000) from and after the Effective Date (provided that
no Default or Event of Default has occurred and is continuing at the time of any
such transfer), and (iii) any transfers of intangible assets and share capital
pursuant to the PDD Restructuring (substantially as described in the materials
previously delivered to the Agent), provided that the Company comply with the
delivery of any required Collateral Documents under Section 7.16 hereof,
following such transfers.
"Permitted Transferee" shall mean a "Permitted Transferee" as defined in
the Company's current Certificate of Incorporation, and any subsequent amendment
of the definition of such term approved by the Required Lenders.
"Person" shall mean an individual, corporation, partnership, limited
liability company, trust, incorporated or unincorporated organization, joint
venture, joint stock company, or a government or any agency or political
subdivision thereof or other entity of any kind.
19
"Pledge Agreement(s)" shall mean the various stock pledge agreements,
including any nantissements, notarial deeds, pledges of financial instrument
accounts, or other local law pledges (and any of them) previously executed and
delivered, executed and delivered as of the Effective Date or to be executed or
delivered pursuant to Sections 7.16 and/or 7.18 hereof all, in favor of the
Agent, for and on behalf of the Lenders under this Agreement and, except with
respect to those Pledge Agreements executed by or covering the share capital of
a Significant Foreign Subsidiary, on behalf of any Lenders or their Affiliates
(or any of them) under any Hedging Obligations, in each case as amended or
otherwise modified from time to time.
"Prime Rate" shall mean the per annum interest rate established by Agent,
or in the case of Swing Line Advances carried at the Prime-based Rate, by the
Swing Line Bank, as its prime rate for its borrowers, as such rate may vary from
time to time, which rate is not necessarily the lowest rate on loans made by
Agent or the Swing Line Bank at any such time.
"Prime-based Advance" shall mean an Advance (including a Swing Line
Advance) which bears interest at the Prime-based Rate.
"Prime-based Rate" shall mean that rate of interest which is the greater
of (i) the Prime Rate or (ii) the Alternate Base Rate.
"Prior Credit Agreement" is defined in the Preamble.
"Pro Forma Projected Financial Information" shall mean, as to any proposed
acquisition, a statement executed by an Authorized Officer of the Company
(supported by reasonable detail) setting forth the total consideration to be
paid or incurred in connection with the proposed acquisition and, pro forma
combined projected financial information for the Company and its Consolidated
Subsidiaries and the acquisition target (if applicable), consisting of projected
opening balance sheets and covenant calculations as of the proposed effective
date of the acquisition or the closing date and as of the end of at least the
next succeeding three (3) fiscal years of Company following the acquisition and
projected statements of income, balance sheets and cash flow statements for each
of those years based on historical financial information prepared in accordance
with GAAP, including sufficient detail to permit calculation of the amounts and
the financial covenants described in Sections 7.4 through 7.6 hereof and
evidencing projected compliance therewith, as projected as of the effective date
of the acquisition and for those fiscal years and accompanied by (i) a statement
setting forth a calculation of the ratios and amounts so described and (ii) a
statement in reasonable detail specifying all material assumptions underlying
the projections.
"Prohibited Transaction" shall mean any transaction involving a Pension
Plan which constitutes a "prohibited transaction" under Section 406 of ERISA or
Section 4975 of the Internal Revenue Code.
"Quoted Rate" shall mean the rate of interest per annum offered by the
Swing Line Bank in its sole discretion with respect to a Swing Line Advance.
"Quoted Rate Advance" means any Swing Line Advance which bears interest at
the Quoted Rate.
20
"Rating Agency" shall mean Fitch Investor Services, Inc., S&P, or Moody's,
or any of their respective successors, or any other nationally recognized rating
agency, and "Rating Agencies" shall be the collective reference to any or all of
the foregoing.
"Reaffirmation(s) of Certain Loan Documents" shall mean the
Reaffirmation(s) of Certain Loan Documents, executed and delivered pursuant to
Section 5.3 by the Company, the Permitted Borrowers and certain Significant
Subsidiaries, substantially in the form of Exhibit J attached hereto.
"Refunded Swing Line Advance" is defined in Section 2.5(e) hereof.
"Register" is defined in Section 13.8(f) hereof.
"Remaining Siliconix Acquisition" shall mean the purchase or other
acquisition by Company or any of its Domestic Subsidiaries of all or any portion
of the shares of stock of Siliconix.
"Reportable Event" shall mean a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations promulgated thereunder, which is
material to the Company and its Subsidiaries, taken as a whole.
"Request for Advance" shall mean a Request for Revolving Credit Advance or
a Request for Swing Line Advance, or either of them, as the context may indicate
or otherwise require.
"Request for Revolving Credit Advance" shall mean a request for Revolving
Credit Advance issued by the Company or by a Permitted Borrower and
countersigned by the Company under Section 2.3(c) hereof, as the case may be, in
the form attached annexed hereto as Exhibit A-1, as such form may be amended or
otherwise modified from time to time.
"Request for Swing Line Advance" shall mean a request for Swing Line
Advance issued by the Company or by a Permitted Borrower and countersigned by
the Company under Section 2.5(c) hereof, in the form attached annexed hereto as
Exhibit A-2, as such form may be amended or otherwise modified from time to
time.
"Required Lenders" shall mean at any time Lenders holding 51% of the
aggregate principal amount of the Indebtedness then outstanding hereunder
(provided that, for purposes of determining Required Lenders hereunder,
Indebtedness outstanding under the Swing Line shall be allocated among the
Lenders based on their respective Percentages of the Revolving Credit) or, if no
Indebtedness is then outstanding, Lenders holding 51% of the Percentages.
"Revolving Credit" shall mean the revolving credit loans to be advanced to
the Company or a Permitted Borrower by the Lenders pursuant to Section 2 hereof,
in an aggregate amount (subject to the terms hereof), not to exceed, at any one
time outstanding, the Revolving Credit Aggregate Commitment.
"Revolving Credit Aggregate Commitment" shall mean Four Hundred Million
Dollars ($400,000,000) less the LYONs Reserve, and subject to any reduction or
termination of the Revolving Credit Aggregate Commitment under Section 2.15 or
9.2 hereof.
21
"Revolving Credit Facility Fee" shall mean the facility fee payable to
Agent for distribution to the Lenders pursuant to Section 2.13, hereof.
"Revolving Credit Maturity Date" shall mean the earlier to occur of (i)
May 1, 2007, as such date may be extended from time to time pursuant to Section
2.16 hereof, and (ii) the date on which the Revolving Credit Aggregate
Commitment shall be terminated pursuant to Section 2.15 or 9.2 hereof.
"Revolving Credit Notes" shall mean the revolving credit notes which may
be issued by Company or a Permitted Borrower at the request of a Lender pursuant
to Section 2.2(e) hereof in the form annexed to this Agreement as Exhibit B-1 or
Exhibit B-2, as the case may be, as such Notes may be amended, renewed, replaced
or extended from time to time.
"Securitization Transaction(s)" shall mean a transfer of, or grant of a
Lien on, foreign accounts receivable by any Foreign Subsidiary to a Special
Purpose Subsidiary or other special purpose or limited purpose entity and the
issuance (whether by such Special Purpose Subsidiary or other special purpose or
limited purpose entity or any other Person) of Debt or of any securities secured
directly or indirectly by interests in, or of trust or a comparable certificates
or other securities directly or indirectly evidencing interests in, such foreign
accounts receivable.
"Security Agreement(s)" shall mean the security agreements executed and
delivered by the Company and each Significant Domestic Subsidiary and any
security agreements executed by certain Significant Foreign Subsidiaries
incorporated under the laws of the United States of America, or a state,
territory, possession or other political subdivision thereof after Agent's
receipt of a FPB Advance Notice pursuant to the requirements of Section 7.16
hereof (whether by execution thereof or by execution of a joinder agreement
attached to the form of such security agreement) in favor of the Agent
substantially in the form of the security agreements previously delivered under
this Agreement, as amended or otherwise modified from time to time.
"Senior Debt" shall mean, with respect to the Company and its Consolidated
Subsidiaries, Total Debt, excluding Subordinated Debt.
"Shares", "share capital", "capital stock", "stock" and words of similar
import shall mean and refer to the equity capital interest under applicable law
of any Person in a corporation or other business entity, howsoever such interest
is created or arises, whether such capital consists of common stock, preferred
stock or preference shares, or other stock, and whether such capital is
evidenced by a certificate, share register entry or otherwise.
"Significant Domestic Subsidiary(ies)" shall mean, on the Effective Date,
the domestic Permitted Borrowers, those Domestic Subsidiaries identified as
Significant Domestic Subsidiaries on Schedule 6.6A hereto and thereafter shall
mean the Significant Domestic Subsidiaries as of the Effective Date and all
other Domestic Subsidiaries, whether existing as of the Effective Date or
created or acquired by the Company thereafter, except any Subsidiary:
(a) the total assets of which, on an individual basis, on any date of
determination, are less than $5,000,000; and
22
(b) which has, as of the most recent fiscal quarter then ending, for the
four preceding fiscal quarters, an EBITDA of less than $1,000,000;
provided however that, notwithstanding the foregoing, neither Siliconix nor any
of its Subsidiaries shall be considered a Significant Domestic Subsidiary
hereunder unless and until Siliconix becomes a 100% Subsidiary or until
Siliconix complies with Section 2.1 and/or Section 7.16 hereof.
"Significant Foreign Subsidiary(ies)" shall mean, on the Effective Date,
the foreign Permitted Borrowers, those Foreign Subsidiaries which have executed
and delivered a Foreign Guaranty on or prior to the Effective Date, as
identified on Schedule 6.6A hereto, and thereafter shall mean the Significant
Foreign Subsidiaries as of the Effective Date and all other Foreign
Subsidiaries, whether existing as of the Effective Date or created or acquired
by the Company thereafter, except any Subsidiary:
(a) the total assets of which, on an individual basis, on any date of
determination, are, excluding goodwill, less than $30,000,000; and
(b) which has, as of the most recent fiscal quarter then ending, for the
four preceding fiscal quarters, an EBITDA of less than $2,500,000;
provided however that, notwithstanding the foregoing, neither Vishay Israel nor
any of its Subsidiaries organized under the laws of Israel shall be considered a
Significant Foreign Subsidiary hereunder and no Subsidiary of Siliconix shall be
a Significant Foreign Subsidiary unless and until Siliconix becomes a
Significant Domestic Subsidiary.
"Significant Subsidiary(ies)" shall mean the Significant Domestic
Subsidiaries and the Significant Foreign Subsidiaries.
"Siliconix" shall mean Siliconix Incorporated, a Delaware corporation.
"SPFV" shall mean a special purpose funding vehicle utilized by a Granting
Lender pursuant to Section 13.8 hereof to fund all or any part of any Advance
that such Lender would otherwise be obligated to fund under this Agreement.
"Special Letters of Credit" shall mean letters of credit issued by Agent
(or, with respect to the letter of credit issued by Syndication Agent, or its
affiliates, described on Schedule 1.7 hereto, and any extensions or renewals
thereof) as an administrative convenience for the account of the Company or its
Subsidiaries on its own behalf and not on behalf (by risk participation or
otherwise) of the other Lenders, in an aggregate amount at any time outstanding
not to exceed the Letter of Credit Reserve in effect at such time, each such
letter of credit being in an undrawn amount of less than $750,000.
"Special Purpose Subsidiary" shall mean any wholly-owned direct or
indirect Subsidiary of the Company established for the sole purpose of
conducting a Permitted Securitization and otherwise established and operated in
accordance with customary industry practices.
23
"S&P" means Standard & Poor's Rating Services, a division of The
McGraw-Hill Companies, Inc., its successors and assigns, and, if such
organization shall be dissolved or liquidated or shall no longer perform the
functions of a securities rating agency, "S&P" shall be deemed to refer to any
other nationally recognized securities rating agency designated by the Agent.
"Stockholder's Equity" shall mean (i) legal capital consisting of common
or preferred stock, (ii) paid-in capital to the extent of the excess over par or
stated value paid for capital stock and that created by a corporate readjustment
and (iii) retained earnings consisting of cumulative Net Income reduced by
dividends declared or paid.
"Subordinated Debt" shall mean all Debt of the Company and its
Subsidiaries which has been subordinated in right of payment and priority to the
Indebtedness, in each case on terms and conditions reasonably satisfactory to
the Agent and the Required Lenders, including, without limitation, the
Subordinated Debt existing on the Effective Date and identified (as such) on
Schedule 8.13 hereto.
"Subsidiary(ies)" shall mean any corporation, association, joint stock
company, limited liability company, partnership or business trust of which more
than fifty percent (50%) of the outstanding voting stock or other ownership
interests is owned either directly or indirectly by Company or one or more of
its Subsidiaries or by Company and one or more of its Subsidiaries, or the
management of which is otherwise controlled, directly, or indirectly through one
or more intermediaries, or both, by Company and/or its Subsidiaries. "100%
Subsidiary(ies)" shall mean any of the Company's Subsidiaries whose stock (other
than directors' or qualifying shares to the extent required under applicable
law) or other ownership interests is owned 100% by any other 100% Subsidiary
and/or the Company, and shall also include Vishay Israel.
"Swing Line" shall mean the revolving credit loan to be advanced to the
Company or a Permitted Borrower by the Swing Line Bank pursuant to Section 2.5
hereof, in an aggregate amount (subject to the terms hereof) not to exceed, at
any one time outstanding, the Swing Line Maximum Amount.
"Swing Line Advance" shall mean an Advance made by Swing Line Bank to
Company or a Permitted Borrower pursuant to Section 2.5 hereof.
"Swing Line Bank" shall mean Comerica Bank, and its successors and
assigns.
"Swing Line Maximum Amount" shall mean Forty Million Dollars
($40,000,000).
"Swing Line Notes" shall mean the swing line notes which may be issued by
Company or a Permitted Borrower at the request of Swing Line Bank pursuant to
Section 2.5(a) hereof in the form annexed hereto as Exhibit C-1 or C?2, as the
case may be, as such Notes may be amended or supplemented from time to time, and
any notes issued in substitution, replacement or renewal thereof from time to
time.
"Syndication Agent" shall mean Fleet Securities, Inc., or its permitted
successors and/or assigns.
24
"Tangible Net Worth" shall mean, as of any date of determination, the
total common shareholders' equity of the Company and its Subsidiaries on a
Consolidated basis, together with the amount, if any, of preferred stock which
is classified as part of shareholders' equity, as reflected on the most recent
regularly prepared quarterly balance sheet of the Company and such Subsidiaries,
which balance sheet shall be prepared in accordance with GAAP, minus the book
amount of intangible assets including, without limitation, such items as
goodwill, trademarks, trade names, copyrights, patents, licenses and rights in
any intangible assets, and unamortized debt discount and expense, as of such
date determined in accordance with GAAP, but excluding the effects of the
currency translation adjustment and of the pension adjustment under the
additional minimum liability section of FASB 87.
"Total Debt" shall mean, with respect to the Company and its Consolidated
Subsidiaries, as of any date of determination, the sum, without duplication, of
(a) the aggregate outstanding principal amounts of (i) Advances of the Revolving
Credit and Swing Line outstanding as of such date and any Letter of Credit
Obligations outstanding as of such date, (ii) all other Debt of the Company and
its Subsidiaries as of such date for borrowed money or which is evidenced by
debentures, notes or other similar instruments, (iii) all other obligations of
the Company and its Subsidiaries as of such date to reimburse the issuers of
letters of credit issued for their account for each payment made by such issuers
under such letters of credit (iv) all capitalized lease obligations of the
Company and its Subsidiaries as of such date (v) all obligations of Company and
its Subsidiaries under conditional sale or other title retention agreements
relating to property or assets purchased and (vi) any Debt or off balance sheet
obligations issued pursuant to a Securitization Transaction (whether by a
Special Purpose Subsidiary or otherwise), all determined on a Consolidated
basis.
"Trans-European Business Day" shall mean a day when the Trans-European
Settlement System is open for business.
"Trans-European Settlement System" shall mean the Trans-European Automated
Real-time Gross Settlement Express Transfer System or any successor.
"Treaty on European Union" shall mean the Treaty of Maastricht (which was
signed at Maastricht on February 7, 1992 and came into force on November 1,
1993), as amended by the Treaty of Amsterdam (which was signed on October 2,
1997 and came into force on May 1, 1999) and the Treaty of Nice (which was
signed on February 26, 2001 and came into force on February 1, 2003).
"Vishay Asia" shall mean Vishay Intertechnology Asia Limited Pte., a
company organized under the laws of Singapore.
"Vishay Europe" shall mean Vishay Europe GmbH, a company organized under
the laws of the Federal Republic of Germany, formerly known as Vishay
Beteiligungs GmbH.
"Vishay Electronic" shall mean Vishay Electronic GmbH, a company organized
under the laws of the Federal Republic of Germany.
"Vishay Israel" shall mean Vishay Israel Limited, a corporation organized
under the laws of Israel and a Subsidiary of the Company.
25
1.2 Euro.
(a) Redenomination of Eurocurrency-based Advances and other Advances
into Euro Units.
(i) Each obligation under this Agreement of a party hereto which
(A) was originally denominated in the former national currency
of a Participating Member State, or (B) would otherwise have
been denominated in such former national currency prior to
such date shall be denominated in, or redenominated into, as
applicable, the Euro Unit in accordance with EMU Legislation
and applicable state law, provided that, if and to the extent
that any EMU Legislation provides that amounts denominated in
the euro unit or the National Currency Unit of a Participating
Member State, that are payable by crediting an account of the
creditor within that country, may be made in either Euro or
National Currency Units, each party to this Agreement shall be
entitled to pay or repay any such amounts in either the Euro
Unit or such National Currency Unit.
(ii) Subject to any EMU Legislation, references in this Agreement
to a minimum amount (or an integral multiple thereof) in a
National Currency Unit to be paid to or by a party hereto
shall be deemed to be a reference to such reasonably
comparable and convenient amount (or an integral multiple
thereof) in the Euro Unit as the Agent may from time to time
specify.
(b) Payments.
(i) All payments by any Borrower or any Lender of amounts
denominated in the Euro or a National Currency Unit of a
Participating Member State, shall be made in immediately
available, freely transferable, cleared funds to the account
of the Agent in the principal financial center in such
Participating Member State, as from time to time designated by
the Agent for such purpose.
(ii) All amounts payable by the Agent to any party under this
Agreement in the National Currency Unit of a Participating
Member State shall instead be paid in the Euro Unit.
(iii) Subject in the case of any Lender to Section 12.3 hereof, the
Agent shall not be liable to any party to this Agreement in
any way whatsoever for any delay, or the consequences of any
delay, in the crediting to any account of any amount
denominated in the Euro or a National Currency Unit of a
Participating Member State.
(iv) All references herein to the London interbank or other
national market with respect to any National Currency Unit of
a Participating Member State shall be deemed a reference to
the applicable markets and locations referred to in the
definition of "Business Day" in Section 1.1.
26
(c) Increased Costs. The Borrowers shall, from time to time upon demand
of any Lender (with a copy to the Agent), pay to such Lender the
amount of any cost or increased cost incurred by, or of any
reduction in any amount payable to or in the effective return on its
capital to, or of interest or other return foregone by, such Lender
or any holding company of such Lender as a result of the
introduction of, changeover to or operation of the Euro in a
Participating Member State, other than any such cost or reduction or
amount foregone reflected in any interest rate hereunder.
(d) Inconsistent Practice. If the basis of accrual of interest or fees
expressed in this Agreement with respect to the currency of any
state that becomes a Euro Member shall be inconsistent with any
convention or practice in the London interbank market for the basis
of accrual of interest or fees in respect of Euros, such convention
or practice shall replace such expressed basis effective as of and
from the date on which such state becomes a Euro Member; provided,
that if any Advance in the currency of such state is outstanding
immediately prior to such date, such replacement shall take effect,
with respect to such Advance, at the end of the then current
Interest Period.
(e) Unavailability of Euro. If the Agent at any time determines that:
(i) the Euro has ceased to be utilized as the basic accounting unit
of the European Community; (ii) for reasons affecting the market in
Euros generally, Euros are not freely traded between banks
internationally; or (iii) it is illegal, impossible or impracticable
for payments to be made hereunder in Euro, then the Agent may, in
its discretion declare (such declaration to be binding on all the
parties hereto) that any payment made or to be made thereafter
which, but for this provision, would have been payable in the Euro
shall be made in a component currency of the Euro or Dollars (as
selected by the Agent (the "Selected ---------- Currency") and the
amount to be so paid shall be calculated on the basis of the
equivalent of the Euro in the Selected Currency).
(f) Additional Changes at Agent's Discretion. This section and other
provisions of this Agreement relating to Euros and the National
Currency Units of Participating Member States shall be subject to
such further changes (including changes in interpretation or
construction) as the Agent may from time to time in its reasonable
discretion notify to the Borrowers and the Lenders to be necessary
or appropriate to reflect the changeover to the Euro in
Participating Member States.
2. REVOLVING CREDIT
2.1 Commitment. Subject to the terms and conditions of this Agreement
(including without limitation Section 2.3 hereof), each Lender severally and for
itself alone agrees to make Advances of the Revolving Credit in any one or more
of the Permitted Currencies to the Company or to any of the Permitted Borrowers
from time to time on any Business Day during the period from the Effective Date
until (but excluding) the Revolving Credit Maturity Date in an aggregate amount,
based on the Dollar Amount of any Advances outstanding in Dollars and the
Current Dollar Equivalent of any Advances outstanding in Alternative Currencies,
not to exceed
27
at any one time outstanding such Lender's Percentage of the Revolving Credit
Aggregate Commitment. Except as provided in Section 2.12 hereof, for purposes of
this Agreement, Advances in Alternative Currencies shall be determined,
denominated and redenominated as set forth in Section 2.11 hereof. Subject to
the terms and conditions set forth herein, advances, repayments and readvances
may be made under the Revolving Credit. Advances of the Revolving Credit shall
be subject to the following additional conditions and limitations:
(a) No Permitted Borrower shall be entitled to request an Advance of the
Revolving Credit or the Swing Line or the issuance of a Letter of
Credit hereunder until (i) it has become a party to this Agreement,
either by execution and delivery of this Agreement, or by execution
and delivery of a Permitted Borrower Addendum to this Agreement,
(ii) it has become a party to the applicable Guaranty either by
execution and delivery of such Guaranty or by execution and delivery
of a Joinder Agreement to such Guaranty, (iii) in the case of each
Domestic Permitted Borrower, it has become a party to the applicable
Security Agreement, (iv) in the case of the first Advance to a
Foreign Permitted Borrower after the Effective Date, the Company, or
such Foreign Permitted Borrower, has submitted to the Agent, not
less than 90 days prior to date of such Advance, a FPB Advance
Notice and (v) in the case of each Permitted Borrower, the Company
has encumbered and/or delivered (or caused to be encumbered and/or
delivered), as the case may be, pursuant to a Pledge Agreement those
shares of stock issued by such Permitted Borrower and owned
(directly or indirectly) by the Company which are required to be
encumbered and/or delivered under the Prior Credit Agreement or
Section 7.16 or 7.18 hereof, as applicable, and accompanied in each
case by authority documents, legal opinions and other supporting
documents as reasonably required by Agent and the Required Lenders
hereunder;
(b) No Subsidiary which is a Permitted Borrower as of the Effective Date
nor any Foreign Subsidiary which becomes a Permitted Borrower after
the Effective Date shall be entitled to request or maintain (or, in
the case of any Eurocurrency-based Advance, maintain beyond any
applicable Interest Period then in effect) an Advance of the
Revolving Credit or the Swing Line or the issuance of a Letter of
Credit hereunder if it ceases to be a 100% Subsidiary of the
Company. Notwithstanding the foregoing, however, Siliconix (if it
shall become a Permitted Borrower) shall be entitled to request (or
maintain) Advances of the Revolving Credit and the Swing Line and
the issuance of Letters of Credit hereunder so long as at least 80%
of its common shares are owned directly or indirectly by the
Company.
2.2 Accrual of Interest and Maturity; Evidence of Indebtedness. (a) The
Company hereby unconditionally promises to pay to the Agent for the account of
each Lender the then unpaid principal amount of each Revolving Credit Advance of
such Lender made to the Company and each Permitted Borrower, and each Permitted
Borrower hereby unconditionally promises to pay to the Agent for the account of
each Lender the then unpaid principal amount of each Revolving Credit Advance of
such Lender made to such Permitted Borrower, on the Revolving Credit Maturity
Date and on such other dates and in such other amounts as may be required from
time to time pursuant to this Agreement.
28
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Company and each
Permitted Borrower to the appropriate lending office of such Lender
resulting from each Revolving Credit Advance made by such lending
office of such Lender from time to time, including the amounts of
principal and interest payable thereon and paid to such Lender from
time to time under this Agreement.
(c) The Agent shall maintain the Register pursuant to Section 13.8(f),
and a subaccount therein for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount and
applicable Permitted Currency of each Revolving Credit Advance made
hereunder, the type thereof and each Interest Period applicable to
any Eurocurrency-based Advance, (ii) the amount of any principal or
interest due and payable or to become due and payable from the
Company or the applicable Permitted Borrower, as the case may be, to
each Lender hereunder in respect of the Revolving Credit Advances
and (iii) both the amount of any sum received by the Agent hereunder
from the Company or the applicable Permitted Borrower in respect of
the Revolving Credit Advances and each Lender's share thereof.
(d) The entries made in the Register and the accounts of each Lender
maintained pursuant to paragraphs (b) and (c) of this Section 2.1
shall absent manifest error, to the extent permitted by applicable
law, be conclusive evidence of the existence and amounts of the
obligations of the Company and the Permitted Borrowers therein
recorded; provided, however, that the failure of any Lender or the
Agent to maintain the Register or any such account, as applicable,
or any error therein, shall not in any manner affect the obligation
of each of the Company and each Permitted Borrower to repay the
Revolving Credit Advances (and all other amounts owing with respect
thereto) made to the Company or such Permitted Borrower by such
Lender in accordance with the terms of this Agreement.
(e) The Company agrees that, upon written request to the Administrative
Agent (with a copy to the Company) by any Lender, the Company and
each of the Permitted Borrowers will execute and deliver, to such
Lender, at the Company's (or such Permitted Borrower's) own expense,
a Revolving Credit Note of each of the Company and each of the
Permitted Borrowers evidencing the outstanding Revolving Credit
Advances owing to such Lender; provided, that the delivery of such
Revolving Credit Notes shall not be a condition precedent to the
Effective Date.
2.3 Requests for and Refundings and Conversions of Advances. Company or a
Permitted Borrower (with the countersignature of Company hereunder) may request
an Advance of the Revolving Credit, refund any such Advance in the same type of
Advance or convert any such Advance to any other type of Advance of the
Revolving Credit only after delivery to Agent of a Request for Revolving Credit
Advance executed by an Authorized Officer of Company or of such Permitted
Borrower (with the countersignature of an Authorized Officer of the Company),
subject to the following and to the remaining provisions hereof:
29
(a) each such Request for Revolving Credit Advance shall set forth the
information required on the Request for Advance form annexed hereto
as Exhibit A-1, including without limitation:
(i) the proposed date of such Advance, which must be a Business
Day;
(ii) whether such Advance is a refunding or conversion of an
outstanding Advance;
(iii) whether such Advance is to be a Prime-based Advance or a
Eurocurrency-based Advance, and, except in the case of a
Prime-based Advance, the first Interest Period applicable
thereto; and
(iv) in the case of a Eurocurrency-based Advance, the Permitted
Currency in which such Advance is to be made.
(b) each such Request for Revolving Credit Advance shall be delivered to
Agent by 12:00 noon (Detroit time) three (3) Business Days prior to
the proposed date of Advance, except in the case of a Prime-based
Advance, for which the Request for Advance must be delivered by
12:00 noon (Detroit time) on such proposed date;
(c) on the proposed date of such Advance, the Dollar Amount of the
principal amount of such requested Advance, plus the Dollar Amount
of the principal amount of any other Advances of the Revolving
Credit and of the Swing Line being requested on such date, plus the
principal amount of all other Advances of the Revolving Credit and
of the Swing Line then outstanding hereunder, in each case whether
to Company or the Permitted Borrowers (using the Current Dollar
Equivalent of any such Advances outstanding in any Alternative
Currency, determined pursuant to the terms hereof as of the date of
such requested Advance), plus the aggregate undrawn portion of any
Letters of Credit which shall be outstanding as of the date of the
requested Advance (based on the Dollar Amount of the undrawn portion
of any Letters of Credit denominated in Dollars and the Current
Dollar Equivalent of the undrawn portion of any Letters of Credit
denominated in any Alternative Currency), the aggregate face amount
of Letters of Credit requested but not yet issued (determined as
aforesaid) and the aggregate amount of all drawings made under any
Letter of Credit for which the Agent has not received full
reimbursement from the applicable Account Party (using the Current
Dollar Equivalent thereof for any Letters of Credit denominated in
any Alternative Currency), shall not exceed the Revolving Credit
Aggregate Commitment; provided however, that, in the case of any
Advance of the Revolving Credit being applied to refund an
outstanding Swing Line Advance, the aggregate principal amount of
Swing Line Advances to be refunded shall not be included for
purposes of calculating the limitation under this Section 2.3(c);
(d) in the case of a Permitted Borrower, on the proposed date of such
Advance, the principal amount of the Advance of the Revolving Credit
being requested by such Permitted Borrower (determined and tested as
aforesaid), plus the principal
30
amount of any other Advances of the Revolving Credit and of the
Swing Line being requested by such Permitted Borrower on such date,
plus the principal amount of any other Advances of the Revolving
Credit and all Advances of the Swing Line then outstanding to such
Permitted Borrower hereunder (determined as aforesaid), plus the
undrawn portion of any Letter of Credit which shall be outstanding
as of the date of the requested Advance for the account of such
Permitted Borrower, plus the aggregate face amount of Letters of
Credit requested but not yet issued for the account of such
Permitted Borrower (in each case determined as aforesaid), plus the
unreimbursed amount of any drawings under any Letters of Credit
(using the Current Dollar Equivalent thereof for any Letters of
Credit denominated in any Alternative Currency) issued for the
account of such Permitted Borrower, shall not exceed the applicable
Permitted Borrower Sublimit;
(e) in the case of a Prime-based Advance, the principal amount of the
initial funding of such Advance, as opposed to any refunding or
conversion thereof, shall be at least $10,000,000;
(f) in the case of a Eurocurrency-based Advance, the principal amount of
such Advance, plus the amount of any other outstanding Advance of
the Revolving Credit to be then combined therewith having the same
Applicable Interest Rate and Interest Period, if any, shall be at
least Fifteen Million Dollars ($15,000,000) or the equivalent
thereof in an Alternative Currency (or a larger integral multiple of
One Hundred Thousand Dollars ($100,000), or the equivalent thereof
in the applicable Alternative Currency) and at any one time there
shall not be in effect more than (x) for Advances to Company, ten
(10) Applicable Interest Rates and Interest Periods, and (y) for
Advances to each Permitted Borrower five (5) Applicable Interest
Rates and Interest Periods for each such currency;
(g) a Request for Revolving Credit Advance, once delivered to Agent,
shall not be revocable by Company or the Permitted Borrowers;
(h) each Request for Revolving Credit Advance shall constitute a
certification by the Company and the applicable Permitted Borrower,
if any, as of the date thereof that:
(i) both before and after such Advance, the obligations of the
Company and the Permitted Borrowers set forth in this
Agreement and the other Loan Documents to which such Persons
are parties are valid, binding and enforceable obligations of
the Company and the Permitted Borrowers, as the case may be;
(ii) all conditions to Advances of the Revolving Credit have been
satisfied, and shall remain satisfied to the date of such
Advance (both before and after giving effect to such Advance);
31
(iii) there is no Default or Event of Default in existence, and none
will exist upon the making of such Advance (both before and
after giving effect to such Advance);
(iv) the representations and warranties contained in this Agreement
and the other Loan Documents are true and correct in all
material respects and shall be true and correct in all
material respects as of the making of such Advance (both
before and after giving effect to such Advance); and
(v) the execution of such Request for Advance will not violate the
material terms and conditions of any material contract,
agreement or other borrowing of Company or the Permitted
Borrowers.
Agent, acting on behalf of the Lenders, may, at its option, lend
under this Section 2 upon the telephone request of an Authorized
Officer of Company or a Permitted Borrower and, in the event Agent,
acting on behalf of the Lenders, makes any such Advance upon a
telephone request, the requesting officer shall fax to Agent, on the
same day as such telephone request, a Request for Advance. Company
and Permitted Borrowers hereby authorize Agent to disburse Advances
under this Section 2.3 pursuant to the telephone instructions of any
person purporting to be a person identified by name on a written
list of persons authorized by the Company and delivered to Agent
prior to the date of such request to make Requests for Advance on
behalf of the Company and the Permitted Borrowers. Notwithstanding
the foregoing, the Company and each Permitted Borrower acknowledge
that Company and each such Permitted Borrower shall bear all risk of
loss resulting from disbursements made upon any telephone request.
Each telephone request for an Advance shall constitute a
certification of the matters set forth in the Request for Revolving
Credit Advance form as of the date of such requested Advance.
2.4 Disbursement of Advances.
(a) Upon receiving any Request for Revolving Credit Advance from Company
or a Permitted Borrower under Section 2.3 hereof, Agent shall
promptly notify each Lender by wire, telex or telephone (confirmed
by wire, telecopy or telex) of the amount and currency of such
Advance to be made and the date such Advance is to be made by said
Lender pursuant to its Percentage of such Advance. Unless such
Lender's commitment to make Advances of the Revolving Credit
hereunder shall have been suspended or terminated in accordance with
this Agreement, each such Lender shall make available the amount of
its Percentage of each Advance in immediately available funds in the
currency of such Advance to Agent, as follows:
(i) for Domestic Advances, at the office of Agent located at One
Detroit Center, Detroit, Michigan 48226, not later than 3:00
p.m. (Detroit time) on the date of such Advance; and
32
(ii) for Eurocurrency-based Advances, at the Agent's Correspondent
for the account of the Eurocurrency Lending Office of the
Agent, not later than 12 noon (the time of the Agent's
Correspondent) on the date of such Advance.
(b) Subject to submission of an executed Request for Revolving Credit
Advance by Company or a Permitted Borrower (with the
countersignature of the Company as aforesaid) without exceptions
noted in the compliance certification therein, Agent shall make
available to Company or to the applicable Permitted Borrower, as the
case may be, the aggregate of the amounts so received by it from the
Lenders in like funds and currencies:
(i) for Domestic Advances, not later than 4:00 p.m. (Detroit time)
on the date of such Advance by credit to an account of Company
or such Permitted Borrower maintained with Agent or to such
other account or third party as Company or such Permitted
Borrower may reasonably direct; and
(ii) for Eurocurrency-based Advances, not later than 4:00 p.m. (the
time of the Agent's Correspondent) on the date of such
Advance, by credit to an account of Company or such Permitted
Borrower maintained with Agent's Correspondent or to such
other account or third party as Company or such Permitted
Borrower may reasonably direct.
(c) Agent shall deliver the documents and papers received by it for the
account of each Lender to such Lender or upon its order. Unless
Agent shall have been notified by any Lender prior to the date of
any proposed Advance that such Lender does not intend to make
available to Agent such Lender's Percentage of such Advance, Agent
may assume that such Lender has made such amount available to Agent
on such date and in such currency, as aforesaid and may, in reliance
upon such assumption, make available to Company or to the applicable
Permitted Borrower, as the case may be, a corresponding amount. If
such amount is not in fact made available to Agent by such Lender,
as aforesaid, Agent shall be entitled to recover such amount on
demand from such Lender. If such Lender does not pay such amount
forthwith upon Agent's demand therefor, the Agent shall promptly
notify Company, and Company or the applicable Permitted Borrower
shall pay such amount to Agent. Agent shall also be entitled to
recover from such Lender or Company or the applicable Permitted
Borrower, as the case may be, but without duplication, interest on
such amount in respect of each day from the date such amount was
made available by Agent to Company or such Permitted Borrower, as
the case may be, to the date such amount is recovered by Agent, at a
rate per annum equal to:
(i) in the case of such Lender, for the first two (2) Business
Days such amount remains unpaid, with respect to Domestic
Advances, the Federal Funds Effective Rate, and with respect
to Eurocurrency-based Advances, Agent's aggregate marginal
cost (including the cost of maintaining any required reserves
or deposit insurance and of any fees, penalties, overdraft
33
charges or other costs or expenses incurred by Agent as a
result of such failure to deliver funds hereunder) of carrying
such amount and thereafter, at the rate of interest then
applicable to such Revolving Credit Advances; and
(ii) in the case of Company or such Permitted Borrower, the rate of
interest then applicable to such Advance of the Revolving
Credit.
The obligation of any Lender to make any Advance of the Revolving
Credit hereunder shall not be affected by the failure of any other
Lender to make any Advance hereunder, and no Lender shall have any
liability to the Company or any of its Subsidiaries, the Agent, any
other Lender, or any other party for another Lender's failure to
make any loan or Advance hereunder.
2.5 (a) Swing Line Advances. The Swing Line Bank shall, on the terms and
subject to the conditions hereinafter set forth (including without limitation
Section 2.5(c) hereof), make one or more advances in Dollars or in any
Alternative Currency (each such advance being a "Swing Line Advance") to Company
or any of the Permitted Borrowers (provided that any such Permitted Borrower has
become a party to this Agreement, either by execution and delivery of this
Agreement, or by complying with the terms and conditions set forth in Section
2.1(a) hereof), from time to time on any Business Day during the period from the
date hereof to (but excluding) the Revolving Credit Maturity Date in an
aggregate amount, based on the Dollar Amount of any such Advances outstanding in
Dollars and the Current Dollar Equivalent of any such Advances outstanding in
Alternative Currencies, not to exceed at any time outstanding the Swing Line
Maximum Amount. Swing Line Bank shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Company and each
of the Permitted Borrowers to Swing Line Bank resulting from each Swing Line
Advance of such Lender from time to time, including the amounts of principal and
interest payable thereon and paid to such Lender from time to time. The entries
made in such account or accounts of Swing Line Bank shall, to the extent
permitted by applicable law, be conclusive evidence, absent manifest error, of
the existence and amounts of the obligations of the Company and the Permitted
Borrower therein recorded; provided, however, that the failure of Swing Line
Bank to maintain such account, as applicable, or any error therein, shall not in
any manner affect the obligation of each of the Company and each Permitted
Borrower to repay the Swing Line Advances (and all other amounts owing with
respect thereto) made to the Company or such Permitted Borrower by Swing Line
Bank in accordance with the terms of this Agreement. Advances, repayments and
readvances under the Swing Line may be made, subject to the terms and conditions
of this Agreement. Each Swing Line Advance shall mature and the principal amount
thereof shall be due and payable by Company or the applicable Permitted Borrower
on the last day of the Interest Period applicable thereto (if any) and in the
case of any Prime-based Advance, on the Revolving Credit Maturity Date.
The Company agrees that, upon the written request of Swing Line Bank (with
a copy concurrently delivered to the Agent), the Company and each of the
Permitted Borrowers will execute and deliver to Swing Line Bank Swing Line Notes
of each of the Company and each of the Permitted Borrowers; provided, that the
delivery of such Swing Line Notes shall not be a condition precedent to the
Effective Date.
34
(b) Accrual of Interest. Each Swing Line Advance shall, from time to
time after the date of such Advance, bear interest at its Applicable
Interest Rate. The amount and date of each Swing Line Advance, its
Applicable Interest Rate, its Interest Period, if any, and the
amount and date of any repayment shall be noted on Swing Line Bank's
account maintained pursuant to Section 2.5(a), which records will be
conclusive evidence thereof, absent manifest error; provided,
however, that any failure by the Swing Line Bank to record any such
information shall not relieve Company or the applicable Permitted
Borrower of its obligation to repay the outstanding principal amount
of such Advance, all interest accrued thereon and any amount payable
with respect thereto in accordance with the terms of this Agreement
and the other Loan Documents.
(c) Requests for Swing Line Advances. Company or a Permitted Borrower
(with the countersignature of the Company) may request a Swing Line
Advance only after delivery to Swing Line Bank (with a copy
concurrently delivered to Agent) of a Request for Swing Line Advance
executed by an Authorized Officer of Company or such Permitted
Borrower, subject to the following and to the remaining provisions
hereof:
(i) each such Request for Swing Line Advance shall set forth the
information required on the Request for Advance form annexed
hereto as Exhibit A-2, including without limitation:
(A) the proposed date of such Swing Line Advance, which must
be a Business Day;
(B) whether such Swing Line Advance is to be a Prime-based
Advance, a Eurocurrency-based Advance or a Quoted Rate
Advance;
(C) the duration of the Interest Period applicable thereto;
and
(D) in the case of a Eurocurrency-based Advance, the
Permitted Currency in which such Advance is to be made.
(ii) the Dollar Amount of the principal amount of such requested
Swing Line Advance, plus the aggregate principal amount of all
other Swing Line Advances then outstanding hereunder
(including any other Swing Line Advances requested to be made
on such date) whether to Company or to any of the Permitted
Borrowers (using the Current Dollar Equivalent of any such
Advances outstanding in any Alternative Currency, determined
pursuant to the terms hereof as of the date of such requested
Advance) shall not exceed the Swing Line Maximum Amount;
(iii) as of the proposed date of such Swing Line Advance, the Dollar
Amount of the principal amount of such requested Swing Line
Advance, plus the aggregate principal amount of all other
Swing Line Advances and all Advances of the Revolving Credit
then outstanding hereunder (including
35
any Revolving Credit Advances or other Swing Line Advances
requested to be made on such date) whether to Company or to
any of the Permitted Borrowers (using the Current Dollar
Equivalent of any such Advances outstanding in any Alternative
Currency, determined pursuant to the terms hereof as of the
date of such requested Advance), and the aggregate undrawn
portion of any Letters of Credit which shall be outstanding as
of the date of the requested Swing Line Advance (based on the
Dollar Amount of the undrawn portion of any Letters of Credit
denominated in Dollars and the Current Dollar Equivalent of
the undrawn portion of any Letters of Credit denominated in
any Alternative Currency), plus the aggregate face amount of
Letters of Credit requested but not yet issued (determined as
aforesaid), plus the unreimbursed amount of any draws under
Letters of Credit (using the Current Dollar Equivalent thereof
for any Letters of Credit denominated in any Alternative
Currency) shall not exceed the Revolving Credit Aggregate
Commitment;
(iv) in the case of any Permitted Borrower, as of the proposed date
of such Swing Line Advance, the principal amount of the
requested Swing Line Advance to such Permitted Borrower
(determined as aforesaid), plus the aggregate principal amount
of any other Swing Line Advances and all other Advances then
outstanding to such Permitted Borrower hereunder (including,
without duplication, Revolving Credit Advances or Swing Line
Advances requested to be made on such date) determined as
aforesaid, plus the aggregate undrawn portion of any Letters
of Credit which shall be outstanding as of the date of the
requested Swing Line Advance for the account of such Permitted
Borrower, plus the aggregate face amount of any Letters of
Credit requested but not yet issued for the account of such
Permitted Borrower hereunder (in each case determined as
aforesaid), plus the unreimbursed amount of any drawings under
any Letters of Credit (using the Current Dollar Equivalent
thereof for any Letters of Credit denominated in any
Alternative Currency) issued for the account of such Permitted
Borrower, shall not exceed the applicable Permitted Borrower
Sublimit;
(v) in the case of a Prime-based Advance, the principal amount of
the initial funding of such Advance, as opposed to any
refunding or conversion thereof, shall be at least One Hundred
Thousand Dollars ($100,000);
(vi) in the case of a Eurocurrency-based Advance or a Quoted Rate
Advance, the principal amount of such Advance, the principal
amount of such Swing Line Advance plus the amount of any other
outstanding Advance of the Swing Line to be then combined
therewith having the same Applicable Interest Rate and
Interest Period, if any, shall be, at least Two Hundred Fifty
Thousand Dollars ($250,000), or the equivalent thereof in an
Alternative Currency (or a larger integral multiple of One
Hundred Thousand Dollars ($100,000), or the equivalent thereof
in the applicable Alternative Currency), and at any one time
there shall not be in effect
36
more than (x) for Advances in Dollars, Five (5) Applicable
Interest Rates and Interest Periods, and (y) for Advances in
any Alternative Currency (other than eurodollars), two (2)
Applicable Interest Rates and Interest Periods for each such
currency;
(vii) each such Request for Swing Line Advance shall be delivered to
the Swing Line Bank (with a copy concurrently delivered to
Agent) (x) for each Advance in Dollars, by 2:00 p.m. (eastern
time) (or such other time as Swing Line Bank shall specify to
Company or the applicable Permitted Borrower) on the proposed
date of the Advance and (y) for each Advance in any
Alternative Currency, by 10:00 a.m. (eastern time) two (2)
Business Days prior to the proposed date of Advance;
(viii) each Request for Swing Line Advance, once delivered to Swing
Line Bank, shall be irrevocable by Company, and shall
constitute and include a certification by the Company as of
the date thereof that:
(A) both before and after such Swing Line Advance, the
obligations of the Company set forth in this Agreement
and the Loan Documents, are valid, binding and
enforceable obligations of the Company;
(B) all conditions to the making of Swing Line Advances
have been satisfied (both before and after giving
effect to such Advance);
(C) both before and after the making of such Swing Line
Advance, there is no Default or Event of Default in
existence; and
(D) both before and after such Swing Line Advance, the
representations and warranties contained in this
Agreement and the other Loan Documents are true and
correct in all material respects.
(ix) At the option of the Swing Line Bank, subject to revocation by
Swing Line Bank at any time and from time to time, the Company
may utilize the Swing Line Bank's "Sweep to Loan" automated
system for obtaining Swing Line Advances. Each time a Swing
Line Advance is made using the "Sweep to Loan" system, the
Company shall be deemed to have certified to the Swing Line
Bank and the Lenders each of the matters set forth in clause
(viii) of this Section. Swing Line Bank may revoke the
Company's privilege to use the "Sweep to Loan" system at any
time and from time to time for any reason, and, immediately
upon any such revocation, the "Sweep to Loan" system shall no
longer be available to the Company for the funding of Swing
Line Advances hereunder (or otherwise) and regular procedures
set forth for the making of Swing Line Advances shall be
deemed immediately to apply. If the Swing Line Bank makes any
Swing Line Advances such that (i) the total amount of the
Advances and outstanding Letters of Credit exceeds the
Revolving Credit Aggregate Commitment or (ii) the total of
Swing Line Advances exceeds
37
the Swing Line Maximum Amount as a result, in either case, of
the Company's use of the "Sweep to Loan" system, no Lender
shall be required to participate in any such excess Swing Line
Advances.
(d) Disbursement of Swing Line Advances. Unless otherwise notified in
writing by Agent promptly following each receipt of Request for
Swing Line Advance hereunder, Swing Line Bank may assume that all
conditions precedent to the disbursement of such requested Swing
Line Advance have been satisfied, including without limitation that
no Default or Event of Default has occurred and is continuing and
that the entirety of the Swing Line Maximum Amount less any
outstanding Swing Line Advances is available hereunder (provided
that Agent shall have no responsibility whatsoever to Swing Line
Bank or to any other Lender to give any notice hereunder, except as
set forth in Section 12.12 of this Agreement), and subject to the
proper submission of an executed Request for Swing Line Advance by
Company or a Permitted Borrower without exceptions noted in the
compliance certification therein and to the other terms and
conditions hereof, Swing Line Bank shall make available to Company
or the applicable Permitted Borrower the amount so requested, in
like funds and currencies, not later than:
(i) for Prime-based Advances or Quoted Rate Advances, not later
than 5:00 p.m. (eastern time) on the date of such Advance by
credit to an account of Company or the applicable Permitted
Borrower maintained with the Swing Line Bank or with Agent or
to such other account or third party as Company or the
Permitted Borrower may reasonably direct in writing; and
(ii) for Eurocurrency-based Advances, not later than 4:00 p.m. (the
time of the office of Swing Line Bank funding such Advance) on
the date of such Advance, by credit to an account of Company
or the Permitted Borrower maintained with the Swing Line
Bank's or the Agent's Correspondent or to such other account
or third party as Company or the applicable Permitted Borrower
may reasonably direct.
Swing Line Bank shall promptly notify Agent of any Swing Line
Advance by telephone, telex or telecopier.
(e) Refunding of or Participation Interest in Swing Line Advances.
(i) Acting through Agent (which shall, subject to the terms
hereof, comply with the Swing Line Bank's request), the Swing
Line Bank, at any time in its sole and absolute discretion,
may on behalf of the Company or the applicable Permitted
Borrower (each of which hereby irrevocably directs the Swing
Line Bank and the Agent to act on its behalf) request each of
the Lenders (including the Swing Line Bank in its capacity as
a Lender) to make an Advance of the Revolving Credit to each
of Company and the applicable Permitted Borrowers, for each
Permitted Currency in which Swing Line Advances are
outstanding to such party, in an amount (in the
38
applicable Permitted Currency, determined in accordance with
Section 2.11(b) hereof) equal to such Lender's Percentage of
the principal amount of the aggregate Swing Line Advances
outstanding in each Permitted Currency to each such party on
the date such notice is given (the "Refunded Swing Line
Advances"); provided however that Swing Line Advances which
are carried at the Quoted Rate or the Eurocurrency-based Rate
which are converted to Revolving Credit Advances at the
request of the Swing Line Bank at a time when no Default or
Event of Default has occurred and is continuing, shall not be
subject to Section 11.1 and no losses, costs or expenses may
be assessed by the Swing Line Bank against the Company, a
Permitted Borrower or the other Banks as a consequence of such
conversion. In the case of each Refunded Swing Line Advance
outstanding in Dollars, the applicable Advance of the
Revolving Credit used to refund such Swing Line Advance shall
be a Prime-based Advance. In the case of each Refunded Swing
Line Advance outstanding in any Alternative Currency, the
applicable Advance of the Revolving Credit used to refund such
Swing Line Advance shall be an Advance in the applicable
Alternative Currency, with an Interest Period of one month (or
any lesser number of days selected by Agent in consultation
with the Lenders). In connection with the making of any such
Refunded Swing Line Advances or the purchase of a
participation interest in Swing Line Advances under Section
2.5(e)(ii) hereof, the Swing Line Bank shall retain its claim
against the Company or the applicable Permitted Borrower for
any unpaid interest or fees in respect thereof. Unless any of
the events described in Section 9.1(j) hereof shall have
occurred (in which event the procedures of subparagraph (ii)
of this Section 2.5(e) shall apply) and regardless of whether
the conditions precedent set forth in this Agreement to the
making of an Advance of the Revolving Credit are then
satisfied, but subject to Section 2.5(e)(iii), each Lender
shall make the proceeds of its Advance of the Revolving Credit
available to the Agent for the benefit of the Swing Line Bank
at the office of the Agent specified in Section 2.4(a) hereof
prior to 11:00 a.m. Detroit time (for Domestic Advances) on
the Business Day next succeeding the date such notice is
given, and, in the case of any Eurocurrency-based Advance,
prior to 2:00 p.m. Detroit time on the third Business Day
following the date such notice is given, in each case in
immediately available funds in the applicable Permitted
Currency. The proceeds of such Advances of the Revolving
Credit shall be promptly delivered by Agent to the Swing Line
Bank for application to repay the Refunded Swing Line Advances
in accordance with the terms and conditions of this Agreement.
(ii) If, prior to the making of an Advance of the Revolving Credit
pursuant to subparagraph (i) of this Section 2.5(e), one of
the events described in Section 9.1(j) hereof shall have
occurred, each Lender will, on the date such Advance of the
Revolving Credit was to have been made, purchase from the
Swing Line Bank an undivided participating interest in each
Refunded Swing Line Advance in an amount equal to its
Percentage of
39
such Refunded Swing Line Advance. Each Lender within the time
periods specified in Section 2.5(e)(i) hereof, as applicable,
shall immediately transfer to the Swing Line Bank, in
immediately available funds in the applicable Permitted
Currency of such Swing Line Advance, the amount of its
participation and upon receipt thereof the Swing Line Bank
will deliver to such Lender a participation certificate
evidencing such participation.
(iii) Each Lender's obligation to make Advances of the Revolving
Credit and to purchase participation interests in accordance
with clauses (i) and (ii) of this Section 2.5(e) shall be
absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (i) any set-off,
counterclaim, recoupment, defense or other right which such
Lender may have against Swing Line Bank, the Company, the
Permitted Borrowers or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of any Default
or Event of Default; (iii) any adverse change in the condition
(financial or otherwise) of the Company, any Permitted
Borrower or any other Person; (iv) any breach of this
Agreement by the Company, any Permitted Borrower or any other
Person; (v) any inability of the Company or the Permitted
Borrowers to satisfy the conditions precedent to borrowing set
forth in this Agreement on the date upon which such Advance is
to be made or such participating interest is to be purchased;
(vi) the termination of the Revolving Credit Aggregate
Commitment hereunder; or (vii) any other circumstance,
happening or event whatsoever, whether or not similar to any
of the foregoing. If any Lender does not make available to the
Agent or the Swing Line Bank, as applicable the amount
required pursuant to clause (i) or (ii) above, as the case may
be, the Agent or the Swing Line Bank, as the case may be,
shall be entitled to recover such amount on demand from such
Lender, together with interest thereon for each day from the
date of non-payment until such amount is paid in full (x) for
the first two (2) Business Days such amount remains unpaid, at
the Federal Funds Effective Rate for Advances in Dollars
(other than eurodollars) and for Eurocurrency-based Advances,
the Agent's marginal cost (including the cost of maintaining
any required reserves or deposit insurance and of any fees,
penalties, overdraft charges or other costs or expenses
incurred by Agent as a result of such failure to deliver funds
hereunder) of carrying such amount and (y) thereafter, at the
rate of interest then applicable to such Swing Line Advances.
The obligation of any Lender to make available its pro rata
portion of the amounts required pursuant to clause (i) or (ii)
above shall not be affected by the failure of any other Lender
to make such amounts available, and no Lender shall have any
liability to the Company or any Permitted Borrower, the Agent,
the Swing Line Bank, or any other Lender or any other Person
for another Lender's failure to make the amounts required
under clause (i) or (ii) available.
40
Notwithstanding the foregoing, however, no Lender shall be
required to make any Revolving Credit Advance to refund a
Swing Line Advance or to purchase a participation in a Swing
Line Advance (including without limitation any Swing Line
Advance funded under the "Sweep to Loan" system) if, prior to
the making of the Swing Line Advance, the Swing Line Bank had
received written notice that an Event of Default had occurred
and was continuing, or that the conditions to the making of
such Swing Line Advances had not been satisfied; provided,
however that the obligation of the Lenders to make such
Revolving Credit Advances or to purchase participations in
Swing Line Advances shall be reinstated upon the date which
such Event of Default has been waived by the Required Lenders
or all Lenders, as applicable.
2.6 Prime-based Interest Payments. Interest on the unpaid balance of all
Prime-based Advances of the Revolving Credit and all Swing Line Advances carried
at the Prime-based Rate from time to time outstanding shall accrue from the date
of such Advance to the Revolving Credit Maturity Date (and until paid), at a per
annum interest rate equal to the Prime-based Rate, and shall be payable in
immediately available funds (a) with respect to Swing Line Advances, quarterly
commencing on the first day of the calendar quarter next succeeding the calendar
quarter during which the initial Swing Line Advance is made and on the first day
of each calendar quarter thereafter, and (b) with respect to Advances of the
Revolving Credit, quarterly commencing on the first day of the calendar quarter
next succeeding the calendar month during which the initial Advance of the
Revolving Credit is made and on the first day of each calendar quarter
thereafter. Interest accruing at the Prime-based Rate shall be computed on the
basis of a 360 day year and assessed for the actual number of days elapsed, and
in such computation effect shall be given to any change in the interest rate
resulting from a change in the Prime-based Rate on the date of such change in
the Prime-based Rate.
2.7 Eurocurrency-based Interest Payments and Quoted Rate Interest
Payments.
(a) Interest on each Eurocurrency-based Advance of the Revolving Credit
and all Swing Line Advances carried at the Eurocurrency-based Rate
shall accrue at its Applicable Interest Rate and shall be payable in
immediately available funds on the last day of the Interest Period
applicable thereto (and, if any Interest Period shall exceed three
months, then on the last Business Day of the third month of such
Interest Period, and at three month intervals thereafter). Interest
accruing at the Eurocurrency-based Rate shall be computed on the
basis of a 360 day year (except that any such Advances made in
Sterling or any other Alternative Currency with respect to which
applicable law or market custom so requires shall be calculated
based on a 365 day year, or as otherwise required under applicable
law or market custom) and assessed for the actual number of days
elapsed from the first day of the Interest Period applicable thereto
to but not including the last day thereof. Interest due on a
Eurocurrency-based Advance made in an Alternative Currency shall be
paid in such Alternative Currency.
(b) Interest on each Quoted Rate Advance of the Swing Line shall accrue
at its Quoted Rate and shall be payable in immediately available
funds on the last day
41
of the Interest Period applicable thereto. Interest accruing at the
Quoted Rate shall be computed on the basis of a 360 day year (except
that any such Advances made in any Alternative Currency with respect
to which applicable law or market custom so requires shall be
calculated based on a 365 day year, or as otherwise required under
applicable law or market custom) and assessed for the actual number
of days elapsed from the first day of the Interest Period applicable
thereto to, but not including the last day thereof.
(c) If the basis of accrual of interest or fees expressed in this
Agreement with respect to the National Currency Unit of a
Participating Member State shall be inconsistent with any convention
or practice in the London interbank market or other applicable
interbank market, as the case may be, for the basis of accrual of
interest or fees with respect to the Euro, such convention or
practice shall replace such expressed basis, effective as of and
from the date on which such country becomes a Participating Member
State; provided that if any Eurocurrency-based Advance in the
currency of such country is outstanding immediately prior to such
date, such replacement shall take effect, with respect to such
Advance, at the end of the then current Interest Period.
2.8 Interest Payments on Conversions. Notwithstanding anything to the
contrary in the preceding sections, all accrued and unpaid interest on any
Advance converted pursuant to Section 2.3 hereof shall be due and payable in
full on the date such Advance is converted.
2.9 Interest on Default. In the event and so long as any Event of Default
under Section 9.1(a) or 9.1(b) shall exist, interest shall be payable daily on
all Eurocurrency-based Advances of the Revolving Credit, Swing Line Advances
carried at the Eurocurrency-based Rate and Quoted Rate Advances from time to
time outstanding at a per annum rate equal to the Applicable Interest Rate plus
three percent (3%) for the remainder of the then existing Interest Period, if
any, and at all other such times, with respect to Prime-based Advances from time
to time outstanding, at a per annum rate equal to the Prime-based Rate plus
three percent (3%), and, with respect to Eurocurrency-based Advances thereof in
any Alternative Currency from time to time outstanding, (i) at a per annum rate
calculated by the Agent, whose determination shall be conclusive absent manifest
error, on a daily basis, equal to three percent (3%) above the interest rate per
annum at which one (1) day deposits (or, if such amount due remains unpaid for
more than three (3) Business Days, then for such other period of time as the
Agent may elect which shall in no event be longer than six (6) months) in the
relevant eurocurrency in the amount of such overdue payment due to the Agent are
offered by the Agent's Eurocurrency Lending Office for the applicable period
determined as provided above, or (ii) if at any such time such deposits are not
offered by Eurocurrency Lending Office, then at a rate per annum equal to three
percent (3%) above the rate determined by the Agent to be its aggregate marginal
cost (including the cost of maintaining any required reserves or deposit
insurance) of carrying the amount of such Eurocurrency-based Advance.
2.10 Prepayment. (a) Company or the Permitted Borrowers may prepay all or
part of the outstanding balance of any Prime-based Advance(s) of the Revolving
Credit at any time, provided that the amount of any partial prepayment shall be
at least One Million Dollars ($1,000,000) and, after giving effect to any such
partial prepayment, the aggregate balance of
42
Prime-based Advance(s) of the Revolving Credit remaining outstanding, if any,
shall be at least Five Million Dollars ($5,000,000). Subject to Section 11.1
hereof, Company or the Permitted Borrowers may prepay all or part of any
Eurocurrency-based Advance (subject to not less than two (2) Business Days'
notice to Agent) provided that the amount of any such partial prepayment shall
be at least One Million Dollars ($1,000,000), or the Current Dollar Equivalent
thereof in an Alternative Currency, and, after giving effect to any such partial
prepayment, the unpaid portion of such Advance which is refunded or converted
under Section 2.3 hereof shall be at least Fifteen Million Dollars ($15,000,000)
or the Current Dollar Equivalent thereof in an Alternative Currency.
(b) Company may prepay all or part of the outstanding balance of any
Swing Line Advance carried at the Prime-based Rate at any time,
provided that, unless the "Sweep to Loan" system shall be in effect
hereunder, the amount of any partial prepayment shall be at least
Twenty Five Thousand Dollars ($25,000) and, after giving effect to
any such partial prepayment, the aggregate balance of such Swing
Line Advances remaining outstanding, if any, shall be at least One
Hundred Thousand Dollars ($100,000). Subject to Section 11.1 hereof,
Company may prepay all or part of any Swing Line Advances carried at
the Eurocurrency-based Rate or Quoted Rate (subject to not less than
two (2) Business Days' notice to Swing Line Bank and Agent) only on
the last day of the Interest Period therefor, provided that the
amount of any such partial payment shall be at least Twenty Five
Thousand Dollars ($25,000) and, after giving effect to any such
partial prepayment, the unpaid portion of such Advance which is
refunded or converted under Section 2.5(c) hereof shall be at least
Two Hundred Fifty Thousand Dollars ($250,000).
(c) Any prepayment made in accordance with this Section shall be subject
to Section 11.1 hereof, but otherwise without premium, penalty or
prejudice to the right to readvance under the terms of this
Agreement.
2.11 Determination, Denomination and Redenomination of Alternative
Currency Advances. Whenever, pursuant to any provision of this Agreement:
(a) an Advance of the Revolving Credit or a Swing Line Advance is
initially funded, as opposed to any refunding or conversion thereof,
in an Alternative Currency, the amount to be advanced hereunder will
be the equivalent in such Alternative Currency of the Dollar Amount
of such Advance;
(b) an existing Advance of the Revolving Credit or a Swing Line Advance
denominated in an Alternative Currency is to be refunded, in whole
or in part, with an Advance denominated in the same Alternative
Currency, the amount of the new Advance shall be continued in the
amount of the Alternative Currency so refunded;
(c) an existing Advance of the Revolving Credit denominated in an
Alternative Currency is to be converted, in whole or in part, to an
Advance denominated in another Alternative Currency, the amount of
the new Advance shall be that
43
amount of the Alternative Currency of the new Advance which may be
purchased, using the most favorable spot exchange rate determined by
Agent to be available to it for the sale of Dollars for such other
Alternative Currency at approximately 11:00 a.m. (Detroit time) two
(2) Business Days prior to the last day of the Eurocurrency Interest
Period applicable to the existing Advance, with the Dollar Amount of
the existing Advance, or portion thereof being converted; and
(d) an existing Advance of the Revolving Credit denominated in an
Alternative Currency is to be converted, in whole or in part, to an
Advance denominated in Dollars, the amount of the new Advance shall
be the Dollar Amount of the existing Advance, or portion thereof
being converted (determined as aforesaid).
2.12 Prime-based Advance in Absence of Election or Upon Default. If, (a)
as to any outstanding Eurocurrency-based Advance of the Revolving Credit, or any
Swing Line Advance carried at the Eurocurrency-based Rate, Agent has not
received payment of all outstanding principal and accrued interest on the last
day of the Interest Period applicable thereto, or does not receive a timely
Request for Advance meeting the requirements of Section 2.3 or 2.5(c) hereof
with respect to the refunding or conversion of such Advance, or (b) if any
Advance denominated in an Alternative Currency or any deemed Advance under
Section 3.6 hereof in respect of a Letter of Credit denominated in an
Alternative Currency cannot be refunded or made, as the case may be, in such
Alternative Currency by virtue of Section 11.3 hereof, or (c) subject to Section
2.9 hereof, if on such day a Default or an Event of Default shall have occurred
and be continuing, then the principal amount thereof which is not then prepaid
in the case of a Eurocurrency-based Advance shall, absent a contrary election of
the Required Lenders, be converted automatically to a Prime-based Advance and
the Agent shall thereafter promptly notify Company of said action. If a
Eurocurrency-based Advance converted hereunder is payable in an Alternative
Currency, the Prime-based Advance shall be in an amount equal to the Dollar
Amount of such Eurocurrency-based Advance at such time and the Agent and the
Lenders shall use said Prime-based Advance to fund payment of the Alternative
Currency obligation, all subject to the provisions of Section 2.14 hereof. The
Company and the Permitted Borrowers, if applicable, shall reimburse the Agent
and the Lenders on demand for any costs incurred by the Agent or any of the
Lenders, as applicable, resulting from the conversion pursuant to this Section
2.12 of Eurocurrency-based Advances payable in an Alternative Currency to
Prime-based Advances.
2.13 Revolving Credit Facility Fee. From the Effective Date to the
Revolving Credit Maturity Date, the Company shall pay to the Agent, for
distribution to the Lenders (as set forth below), a Revolving Credit Facility
Fee determined by multiplying the Applicable Fee Percentage per annum times the
Revolving Credit Aggregate Commitment then applicable under Section 2.15 hereof
(whether used or unused) then in effect without giving effect to any reductions
therein based on the amount of the LYONs Reserve, computed on a daily basis. The
Revolving Credit Facility Fee shall be payable quarterly in arrears commencing
October 1, 2003 (in respect of the prior calendar quarter or portion thereof),
and on the first day of each calendar quarter thereafter and on the Revolving
Credit Maturity Date, and shall be computed on the basis of a year of three
hundred sixty (360) days and assessed for the actual number of days elapsed.
Whenever any payment of the Revolving Credit Facility Fee shall be due on a day
which is not a Business Day, the date for payment thereof shall be extended to
the next Business Day. Upon
44
receipt of such payment Agent shall make prompt payment to each Lender of its
share of the Revolving Credit Facility Fee based upon its respective Percentage.
2.14 Currency Appreciation; Mandatory Reduction of Indebtedness.
(a) Revolving Credit Aggregate Commitment. If at any time and for any
reason, the aggregate principal amount of all Advances of the
Revolving Credit hereunder to the Company and to the Permitted
Borrowers made in Dollars and the aggregate Current Dollar
Equivalent of all Advances of the Revolving Credit outstanding
hereunder to the Company and to the Permitted Borrowers in any
Alternative Currency as of such time, plus the aggregate principal
amount of Swing Line Advances outstanding hereunder as of such time
(determined as aforesaid), plus the aggregate undrawn portion of any
Letters of Credit which shall be outstanding (based on the Dollar
Amount of the undrawn portion of any Letters of Credit denominated
in Dollars and the Current Dollar Equivalent of the undrawn portion
of any Letters of Credit denominated in any Alternative Currency),
plus the face amount of all Letters of Credit requested but not yet
issued (determined as aforesaid), plus the unreimbursed amount of
any draws under any Letters of Credit (using the Current Dollar
Equivalent thereof for any Letters of Credit denominated in any
Alternative Currency), as of such time exceeds the Revolving Credit
Aggregate Commitment (as used in this clause (a), the "Excess"), the
Company and the Permitted Borrowers shall:
(i) immediately repay that portion of such Indebtedness then
carried as a Prime-based Advance, if any, by the Dollar Amount
of such Excess, and/or reduce any pending request for an
Advance in Dollars on such day by the Dollar Amount of the
Excess, to the extent thereof; and
(ii) on the last day of each Interest Period of any
Eurocurrency-based Advance outstanding as of such time, until
the necessary reductions of Indebtedness under this Section
2.14(a) have been fully made, repay the Indebtedness carried
in such Advances and/or reduce any requests for refunding or
conversion of such Advances submitted (or to be submitted) by
the Company or the applicable Permitted Borrower in respect of
such Advances, by the amount in Dollars or the applicable
Alternative Currency, as the case may be, of the Excess, to
the extent thereof.
Compliance with this Section 2.14(a) shall be tested on a daily or
other basis satisfactory to Agent in its sole discretion, provided
that, so long as no Default or Event of Default has occurred and is
continuing, at any time while the aggregate Advances of the
Revolving Credit available to be borrowed hereunder (based on the
Revolving Credit Aggregate Commitment then in effect) equal or
exceed Fifty Million Dollars ($50,000,000), compliance with this
Section 2.14(a) shall be tested as of the last day of each calendar
quarter. Notwithstanding the foregoing, upon the occurrence and
during the continuance of any Default or Event of Default, or if any
Excess remains after recalculating said Excess based on ninety-five
percent (95%) of the Current Dollar Equivalent of any Advances or
Letters of
45
Credit denominated in Alternative Currencies (and one hundred
percent (100%) of any Advances or Letters of Credit denominated in
Dollars), Company and the Permitted Borrowers shall be obligated
immediately to reduce the foregoing Indebtedness hereunder by an
amount sufficient to eliminate such Excess.
(b) Permitted Borrower Sublimit. If at any time and for any reason with
respect to any Permitted Borrower, the aggregate principal amount
(tested in the manner set forth in clause (a) above) of all Advances
of the Revolving Credit and of the Swing Line outstanding hereunder
to such Permitted Borrower, plus the aggregate undrawn portion of
any Letters of Credit, plus the face amount of any Letters of Credit
requested but not yet issued, plus the unreimbursed amount of any
drawings under any Letters of Credit to or for the account of such
Permitted Borrower (tested in the manner set forth in clause (a)
above), which Advances and Letters of Credit are made or issued, or
to be made or issued, in Dollars and ninety percent (90%) of the
aggregate Current Dollar Equivalent of all such Advances and Letters
of Credit (including unreimbursed draws) hereunder for the account
of such Permitted Borrower in any Alternative Currency as of such
time, exceeds the applicable Permitted Borrower Sublimit (as used in
this clause (b), the "Excess"), then in each case, such Permitted
Borrower shall
(i) immediately repay that portion of the Indebtedness outstanding
to such Permitted Borrower then carried as a Prime-based
Advance, if any, by the Dollar Amount of such Excess, and/or
reduce on such day any pending request for an Advance in
Dollars submitted by such Permitted Borrower by the Dollar
Amount of such Excess, to the extent thereof; and
(ii) on the last day of each Interest Period of any
Eurocurrency-based Advance outstanding to such Permitted
Borrower as of such time, until the necessary reductions of
Indebtedness under this Section 2.14(b) have been fully made,
repay such Indebtedness carried in such Advances and/or reduce
any requests for refunding or conversion of such Advances
submitted (or to be submitted) by such Permitted Borrower in
respect of such Advances, by the amount in Dollars or the
applicable Alternative Currency, as the case may be, of such
Excess, to the extent thereof.
Provided that no Default or Event of Default has occurred and is continuing,
each Permitted Borrower's compliance with this Section 2.14(b) shall be tested
as of the last day of each calendar quarter or, upon the written request of the
Company from time to time, as of the last day of each calendar month, provided
the Company furnishes Agent with current monthly financial statements complying
with the requirements set forth in subparagraphs (i) and (ii) of Section 7.3(c)
hereof. Upon the occurrence and during the continuance of any Default or Event
of Default, compliance with this Section 2.14(b) shall be tested on a daily or
other basis satisfactory to Agent in its sole discretion.
2.15 Optional Reduction or Termination of Revolving Credit Aggregate
Commitment. Provided that no Default or Event of Default has occurred and is
continuing, the Company may upon at least five (5) Business Days' prior written
notice to the Agent, permanently reduce the
46
Revolving Credit Aggregate Commitment in whole at any time, or in part from time
to time, without premium or penalty, provided that: (i) each partial reduction
of the Revolving Credit Aggregate Commitment shall be in an aggregate amount
equal to Twenty Million Dollars ($20,000,000) or a larger integral multiple of
One Million Dollars ($1,000,000); (ii) each reduction shall be accompanied by
the payment of the Revolving Credit Facility Fee, if any, accrued to the date of
such reduction; (iii) the Company or any Permitted Borrower, as applicable,
shall prepay in accordance with the terms hereof the amount, if any, by which
the aggregate unpaid principal amount of Advances (using the Current Dollar
Equivalent of any such Advance outstanding in any Alternative Currency) of the
Revolving Credit, plus the aggregate principal amount of Swing Line Advances
outstanding hereunder (using the Current Dollar Equivalent of any such Advance
outstanding in an Alternative Currency), plus the aggregate undrawn amount of
outstanding Letters of Credit (using the Current Dollar Equivalent thereof for
any Letters of Credit denominated in any Alternative Currency), plus the
unreimbursed amount of any draws under any Letters of Credit (determined as
aforesaid), exceeds the amount of the Revolving Credit Aggregate Commitment as
so reduced, together with interest thereon to the date of prepayment; (iv) if
the termination or reduction of the Revolving Credit Aggregate Commitment
requires the prepayment of a Eurocurrency-based Advance or a Quoted Rate
Advance, the termination or reduction may be made only on the last Business Day
of the then current Interest Period applicable to such Eurocurrency-based
Advance or such Quoted Rate Advance; and (v) no reduction shall reduce the
Revolving Credit Aggregate Commitment to an amount which is less than the
aggregate undrawn amount of any Letters of Credit outstanding at such time.
Reductions of the Revolving Credit Aggregate Commitment and any accompanying
prepayments of Advances of the Revolving Credit shall be distributed by Agent to
each Lender in accordance with such Lender's Percentage thereof, and will not be
available for reinstatement by or readvance to the Company or any Permitted
Borrower, and any accompanying prepayments of Advances of the Swing Line shall
be distributed by Agent to the Swing Line Bank and will not be available for
reinstatement by or readvance to the Company. Any reductions of the Revolving
Credit Aggregate Commitment hereunder shall reduce each Lender's portion thereof
proportionately (based on the applicable Percentages), and shall be permanent
and irrevocable. Any payments made pursuant to this Section shall be applied
first to outstanding Prime-based Advances under the Revolving Credit, next to
Swing Line Advances carried at the Prime-based Rate, next to Eurocurrency-based
Advances of the Revolving Credit and then to Swing Line Advances carried at the
Eurocurrency-based Rate or the Quoted Rate.
2.16 Extensions of Revolving Credit Maturity Date. (a) Provided that no
Default or Event of Default has occurred and is continuing, Company may, by
written notice to Agent and each Lender (which notice shall be irrevocable and
which shall not be deemed effective unless actually received by Agent and each
Lender) prior to April 30 but not before March 31st of 2004 (provided in no
event shall the Company request an extension of the Revolving Credit Maturity
Date beyond the first put date for the New Convertible Subordinated Debt),
request that the Lenders extend the then applicable Revolving Credit Maturity
Date to a date that is one year later than the Revolving Credit Maturity Date
then in effect (such request, a "Request").
(b) Each Lender shall, within 30 days of receipt of such request, notify
the Agent in writing whether such Lender consents to the extension
of the Revolving Credit Maturity Date, such consent to be in the
sole discretion of such Lender. If any Lender does not so notify the
Agent of its decision within such 30 day period,
47
such Lender shall be deemed to have not consented to such request of
the Borrower.
(c) The Agent shall promptly notify the Company whether the Lenders have
consented to such request. If the Agent does not so notify the
Company within 30 days of the Agent's receipt such Request, the
Agent shall be deemed to have notified the Company that the Lenders
have not consented to the Company's request.
(d) Each Lender which elects not to extend the Revolving Credit Maturity
Date or fails to so notify the Agent of such consent (a
"Non-Consenting Lender") hereby agrees that if any other Lender or
financial institution acceptable to the Company and the Agents
offers to purchase such Non-Consenting Lender's Percentage of the
Revolving Credit Aggregate Commitment within 180 days after receipt
of the related Request for a purchase price equal to the sum of all
amounts then owing with respect to the outstanding Advances (and
participations in any Swing Line Advances or any Letters of Credit)
and all other amounts accrued for the account of such Non-Consenting
Lender, such Non-Consenting Lender will promptly assign, sell and
transfer all of its right, title, interest and obligations with
respect to the foregoing to such other Lender or financial
institution pursuant to and on the terms specified in the form of
Assignment Agreement attached hereto as Exhibit E. Before assigning
to a financial institution other than a Lender pursuant to this
clause (d), each Lender that has elected to extend the Revolving
Credit Maturity Date (a "Consenting Lender") shall have the right,
but not any obligation, pro rata with all other Consenting Lenders
which elect to purchase a pro rata share of such non-consenting
Lender's Percentage of the Revolving Credit Aggregate Commitment
(and participations in Swing Line Advances and Letters of Credit) to
purchase each such Non-Consenting Lender's Percentage thereof
pursuant to this clause (d). The Consenting Lenders which elect to
exercise their purchase options hereunder shall by mutual agreement
determine the amount of each Non-Consenting Lender's Percentage of
the Revolving Credit Aggregate Commitment being purchased by each
Consenting Lender, provided that if there is any dispute among the
Consenting Lenders such purchase shall be based upon a pro rata
sharing of each Non-Consenting Lender's Percentage thereof. Only if
the Consenting Lenders have determined not to purchase all of the
Non-Consenting Lender's Revolving Credit Aggregate Commitment may
financial institutions other than a Consenting Lender then purchase
such Non-Consenting Lender's Revolving Credit Aggregate Commitment.
(e) Except as set forth in subparagraph (f) hereof, notwithstanding
anything herein to the contrary, the Revolving Credit Maturity Date
will not be extended unless all Lenders have consented to the
extension or if another Lender or financial institution has
purchased each such Non-Consenting Lender's Revolving Credit
Aggregate Commitment pursuant to the terms of clause (d) above.
(f) In the event, after giving effect to any assignments to Consenting
Lenders under Section 2.16(d) hereof or otherwise, Lenders holding
eighty percent (80%) or
48
more of the Percentages (the "Approving Percentages") have consented
to an extension of the Revolving Credit Maturity Date hereunder,
such extension shall become effective, notwithstanding that all of
the Lenders have failed to approve such extension in accordance with
this Section 2.16, so long as Company, within forty five (45) days,
reduces the Revolving Credit Aggregate Commitment to an amount not
greater than the product of the Approving Percentages times the
Revolving Credit Aggregate Commitment then in effect and repays the
Indebtedness then outstanding hereunder (and, if necessary causes
any outstanding Letters of Credit to be terminated or discharged) to
the extent such Indebtedness exceeds the Revolving Credit Aggregate
Commitment as so reduced, such that the entire Indebtedness
outstanding to the Non-Consenting Lenders shall have been paid and
discharged in full. Reductions may be made without regard to the
notice provisions set forth in Section 2.15 hereof, but shall
otherwise comply with said Section 2.15, except that any amounts
repaid by the Company against the Indebtedness pursuant to this
subparagraph (f) shall be first applied to the Indebtedness
outstanding to the Non-Consenting Lenders still holding Indebtedness
hereunder at such time, with any remaining amounts applied in
accordance with Section 2.15 hereof and the Percentages held by such
Non-Consenting Lenders shall be reallocated to the Consenting
Lenders (giving effect to any assignments, as aforesaid), pro rata,
based on the Percentages then in effect and Agent shall distribute
to the remaining Lenders a revised Schedule 1.1 reflecting such
reallocated Percentages.
2.17 Application of Advances. Advances of the Revolving Credit (including
Swing Line Advances) shall be available, subject to the terms hereof, to fund
working capital needs, or other general corporate purposes of the Company and
the Permitted Borrowers.
3. LETTERS OF CREDIT.
3.1 Letters of Credit. Subject to the terms and conditions of this
Agreement, Agent shall through the Issuing Office, at any time and from time to
time from and after the date hereof until thirty (30) days prior to the
Revolving Credit Maturity Date, upon the written request of an Account
Party(ies) accompanied by a duly executed Letter of Credit Agreement and such
other documentation related to the requested Letter of Credit as the Agent may
require, issue Letters of Credit for the account of such Account Party(ies), in
an aggregate amount for all Letters of Credit issued hereunder at any one time
outstanding not to exceed the Letter of Credit Maximum Amount. Each Letter of
Credit shall be in a minimum face amount of Five Hundred Thousand Dollars
($500,000) and each Letter of Credit (including any renewal thereof) shall
expire on the earlier to occur of (x) 1 year from the date of issuance and (y)
not later than ten (10) Business Days prior to the Revolving Credit Maturity
Date in effect on the date of issuance thereof. The submission of all
applications in respect of and the issuance of each Letter of Credit hereunder
shall be subject in all respects to the Uniform Customs and Practices for
Documentary Credits of the International Chamber of Commerce, 1993 Revisions,
ICC Publication No. 500, or, if applicable, ISP 98, and any successor
documentation thereto, as selected by the Agent. In the event of any conflict
between this Agreement and any Letter of Credit Document other than a Letter of
Credit, this Agreement shall control.
49
3.2 Conditions to Issuance. No Letter of Credit shall be issued at the
request and for the account of any Account Party(ies) unless, as of the date of
issuance of such Letter of Credit:
(a) the face amount of the Letter of Credit requested (based on the
Dollar Amount of the undrawn portion of any Letter of Credit
denominated in Dollars and the Current Dollar Equivalent of the
undrawn portion of any Letter of Credit denominated in any
Alternative Currency), plus the face amount of all other Letters of
Credit of all Account Parties requested on such date, plus the
aggregate undrawn portion of all other Letters of Credit of all
Account Parties as of such date, plus the face amount of all Letters
of Credit of all Account Parties requested but not yet issued as of
such date, plus the unreimbursed amount of any draws under Letters
of Credit of all Account Parties (in each case, determined as
aforesaid), does not exceed the Letter of Credit Maximum Amount;
(b) the face amount of the Letter of Credit requested, plus the face
amount of all other Letters of Credit of all Account Parties
requested on such date, plus the aggregate undrawn portion of all
other Letters of Credit of all Account Parties as of such date, plus
the face amount of all Letters of Credit of all Account Parties
requested but not yet issued as of such date, plus the unreimbursed
amount of any drawings under Letters of Credit of all Account
Parties as of such date, (in each case determined as aforesaid),
plus the aggregate principal amount of all Advances outstanding
under the Revolving Credit and the Swing Line, including any
Advances requested to be made on such date (determined on the basis
of the Current Dollar Equivalent of any Advances denominated in any
Alternative Currency, and the Dollar Amount of any Advances in
Dollars), do not exceed the then applicable Revolving Credit
Aggregate Commitment;
(c) whenever the Account Party is a Permitted Borrower, the face amount
of the Letter of Credit requested by such Permitted Borrower, plus
the face amount of all other Letters of Credit requested by such
Permitted Borrower on such date, plus the aggregate undrawn portion
of all other outstanding Letters of Credit issued for the account of
such Permitted Borrower (in each case determined as aforesaid), plus
the unreimbursed amount of any drawings under Letters of Credit
(using the Current Dollar Equivalent thereof for any such Letters of
Credit denominated in any Alternative Currency) issued for the
account of such Permitted Borrower, plus the aggregate outstanding
principal amount of all Advances of the Revolving Credit and of the
Swing Line to such Permitted Borrower, including any Advances
requested to be made on such date (in each case determined as
aforesaid), do not exceed the applicable Permitted Borrower
Sublimit;
(d) whenever the Account Party is a Permitted Borrower, it shall not be
entitled to request a Letter of Credit hereunder until it has
complied in all respects with the provisions of Section 2.1(a) or
(b) hereof, as applicable;
(e) the obligations of Company and the Guarantors set forth in this
Agreement and the other Loan Documents are valid, binding and
enforceable obligations of Company and Guarantors and the valid,
binding and enforceable nature of this
50
Agreement and the other Loan Documents has not been disputed by
Company or the Guarantors;
(f) the representations and warranties contained in this Agreement and
the other Loan Documents are true in all material respects as if
made on such date, and both immediately before and immediately after
issuance of the Letter of Credit requested, no Default or Event of
Default exists;
(g) the execution of the Letter of Credit Agreement with respect to the
Letter of Credit requested will not violate the terms and conditions
of any contract, agreement or other borrowing of the relevant
Account Party;
(h) the Account Party requesting the Letter of Credit shall have
delivered to Agent at its Issuing Office, not less than three (3)
Business Days prior to the requested date for issuance (or such
shorter time as the Agent, in its sole discretion, may permit), the
Letter of Credit Agreement related thereto, together with such other
documents and materials as may be required pursuant to the terms
thereof, and the terms of the proposed Letter of Credit shall be
satisfactory to Agent;
(i) no order, judgment or decree of any court, arbitrator or
governmental authority shall purport by its terms to enjoin or
restrain Agent from issuing the Letter of Credit requested, or any
Lender from taking an assignment of its Percentage thereof pursuant
to Section 3.6 hereof, and no law, rule, regulation, request or
directive (whether or not having the force of law) shall prohibit or
request that Agent refrain from issuing, or any Lender refrain from
taking an assignment of its Percentage of, the Letter of Credit
requested or letters of credit generally;
(j) there shall have been no introduction of or change in the
interpretation of any law or regulation that would make it unlawful
or unduly burdensome for the Agent to issue or any Lender to take an
assignment of its Percentage of the requested Letter of Credit, no
suspension of or material limitation on trading on the New York
Stock Exchange or any other national securities exchange, no
declaration of a general banking moratorium by banking authorities
in the United States, Michigan or the respective jurisdictions in
which the Lenders, the applicable Account Party and the beneficiary
of the requested Letter of Credit are located, and no establishment
of any new restrictions on transactions involving letters of credit
or on banks materially affecting the extension of credit by banks;
and
(k) Agent shall have received the issuance fees required in connection
with the issuance of such Letter of Credit pursuant to Section 3.4
hereof.
Each Letter of Credit Agreement submitted to Agent pursuant hereto shall
constitute the certification by the Company and any other Account Party of the
matters set forth in Section 3.2 (a) through (g) hereof. The Agent shall be
entitled to rely on such certification without any duty of inquiry.
3.3 Notice. Agent shall give notice, substantially in the form attached as
Exhibit F, to each Lender of the issuance of each Letter of Credit, not later
than three (3) Business Days after
51
issuance of each Letter of Credit, specifying the amount thereof and the amount
of such Lender's Percentage thereof.
3.4 Letter of Credit Fees. Company shall pay to the Agent for distribution
to the Lenders in accordance with their Percentages, letter of credit fees as
follows:
(a) A non-refundable per annum letter of credit fee with respect to the
undrawn amount of each Letter of Credit issued pursuant hereto
(based on the Dollar Amount of any Letters of Credit denominated in
Dollars and the Current Dollar Equivalent of any Letters of Credit
denominated in any Alternative Currency) in the amount of the
Applicable Fee Percentage (determined with reference to Schedule 4.1
to this Agreement).
(b) A letter of credit facing fee in the amount specified in the Fee
Letter to be retained by Agent for its own Account.
(c) If any change in any law or regulation or in the interpretation
thereof by any court or administrative or governmental authority
charged with the administration thereof shall either (i) impose,
modify or cause to be deemed applicable any reserve, special
deposit, limitation or similar requirement against letters of credit
issued or participated in by, or assets held by, or deposits in or
for the account of, Agent or any Lender or (ii) impose on Agent or
any Lender any other condition regarding this Agreement, the Letters
of Credit or any participations in such Letters of Credit, and the
result of any event referred to in clause (i) or (ii) above shall be
to increase the cost or expense to Agent or such Lender of issuing
or maintaining or participating in any of the Letters of Credit
(which increase in cost or expense shall be determined by the
Agent's or such Lender's reasonable allocation of the aggregate of
such cost increases and expenses resulting from such events), then,
upon demand by the Agent or such Lender, as the case may be, the
Company shall, within thirty (30) days following demand for payment,
pay to Agent or such Lender, as the case may be, from time to time
as specified by the Agent or such Lender, additional amounts which
shall be sufficient to compensate the Agent or such Lender for such
increased cost and expense, together with interest on each such
amount from ten days after the date demanded until payment in full
thereof at the Prime-based Rate. A certificate as to such increased
cost or expense incurred by the Agent or such Lender, as the case
may be, as a result of any event mentioned in clause (i) or (ii)
above, submitted to the Company, shall be conclusive evidence,
absent manifest error, as to the amount thereof.
(d) All payments by the Company or the Permitted Borrowers to the Agent
or the Lenders under this Section 3.4 shall be made in Dollars and
in immediately available funds at the Issuing Office or such other
office of the Agent as may be designated from time to time by
written notice to the Company and the Permitted Borrowers by the
Agent. The fees described in clause (a) and (b) above shall be
nonrefundable under all circumstances, shall be payable quarterly in
advance (or such lesser period, if applicable, for Letters of Credit
issued with stated expiration dates of less than three months) upon
the issuance of each such Letter of Credit,
52
and shall be calculated on the basis of a 360 day year and assessed
(on a quarterly basis as aforesaid) as of the beginning of each
quarter as of which such Letter of Credit is outstanding commencing
on the date of issuance thereof, for the actual number of days from
the beginning of such quarter to the earlier of the beginning of the
next quarter or the stated expiration thereof.
3.5 Other Fees. In connection with the Letters of Credit, and in addition
to the Letter of Credit Fees, the Company and any other applicable Account
Party(ies) shall pay, for the sole account of the Agent, standard documentation,
administration, payment and cancellation charges assessed by Agent or the
Issuing Office, at the times, in the amounts and on the terms set forth or to be
set forth from time to time in the standard fee schedule of the Issuing Office
in effect from time to time and delivered to the relevant Account Party(ies).
3.6 Drawings and Demands for Payment Under Letters of Credit.
(a) The Company and each other applicable Account Party agree to pay to
the Agent, on the day on which the Agent shall honor a draft or
other demand for payment presented or made under any Letter of
Credit, an amount equal to the amount paid by the Agent in respect
of such draft or other demand under such Letter of Credit and all
expenses paid or incurred by the Agent relative thereto. Unless the
Company or the other applicable Account Party shall have made such
payment to the Agent on such day, upon each such payment by the
Agent, the Agent shall be deemed to have disbursed to the Company or
the other applicable Account Party, and the Company or the other
applicable Account Party shall be deemed to have elected to
substitute for its reimbursement obligation, with respect to Letters
of Credit denominated in Dollars, a Prime-based Advance of the
Revolving Credit and, with respect to Letters of Credit denominated
in any Alternative Currency, a Eurocurrency-based Advance of the
Revolving Credit in the applicable Alternative Currency with an
Interest Period, commencing three (3) Business Days following the
date of Agent's payment pursuant to the applicable Letter of Credit,
of one month (or, if unavailable, such other Interest Period as
selected by Agent in its sole discretion), in each case for the
account of the Lenders in an amount equal to the amount so paid by
the Agent in respect of such draft or other demand under such Letter
of Credit. Such Prime-based Advance or Eurocurrency-based Advance
shall be deemed disbursed notwithstanding any failure to satisfy any
conditions for disbursement of any Advance set forth in Section 2
hereof and, to the extent of the Advances so disbursed, the
reimbursement obligation of the Company or the other applicable
Account Party under this Section 3.6 shall be deemed satisfied,
provided that, with respect to any such Eurocurrency-based Advance
deemed to have been made hereunder, Company or the applicable
Permitted Borrower shall also be obligated to pay to the Agent, for
Agent's sole account, interest on the aggregate amount paid by the
Agent under the applicable draft or other demand for payment at
Agent's aggregate marginal cost (including the cost of maintaining
any required reserves or deposit insurance and of any fees,
penalties, overdraft charges or other costs or expenses incurred by
Agent as a result of such failure to deliver funds hereunder) of
carrying such amount plus the Applicable Margin then in effect for
Eurocurrency-based Advances, from the date
53
of Agent's payment pursuant to any Letter of Credit to the date of
the commencement of the Interest Period for the applicable
Eurocurrency-based Advance deemed to have been made, as aforesaid,
such interest (the "Gap Interest") to be due and payable on the last
day of the initial Interest Period established for such deemed
Advance.
(b) If the Agent shall honor a draft or other demand for payment
presented or made under any Letter of Credit, the Agent shall
provide notice thereof to the Company and the other applicable
Account Party on the date such draft or demand is honored, and to
each Lender on such date unless the Company or other applicable
Account Party shall have satisfied its reimbursement obligation
under Section 3.6(a) hereof by payment to the Agent on such date.
The Agent shall further use reasonable efforts to provide notice to
the Company or other applicable Account Party prior to honoring any
such draft or other demand for payment, but such notice, or the
failure to provide such notice, shall not affect the rights or
obligations of the Agent with respect to any Letter of Credit or the
rights and obligations of the parties hereto, including without
limitation the obligations of the Company or other applicable
Account Party under Section 3.6(a) hereof.
(c) Upon issuance by the Agent of each Letter of Credit hereunder, each
Lender shall automatically acquire a pro rata participation interest
in such Letter of Credit and each related Letter of Credit Payment
based on its respective Percentage. Each Lender, on the date a draft
or demand under any Letter of Credit is honored (or the next
succeeding Business Day if the notice required to be given by Agent
to the Lenders under Section 3.6(b) hereof is not given to the
Lenders prior to 2:00 p.m. (Detroit time) on such date of draft or
demand) or three (3) Business Days thereafter in respect of draws or
demands under Letters of Credit issued in any Alternative Currency,
shall make its Percentage of the amount paid by the Agent, and not
reimbursed by the Company or other applicable Account Party on such
day, available in the applicable Permitted Currency and in
immediately available funds at the principal office of the Agent for
the account of the Agent. If and to the extent such Lender shall not
have made such pro rata portion available to the Agent, such Lender,
the Company and any other applicable Account Party severally agree
to pay to the Agent forthwith on demand such amount together with
interest thereon, for each day from the date such amount was paid by
the Agent until such amount is so made available to the Agent at a
per annum rate equal to the interest rate applicable during such
period to the related Advance deemed to have been disbursed under
Section 3.6(a) in respect of the reimbursement obligation of the
Company and any other applicable Account Party, as set forth in
Section 2.4(c)(i) or 2.4(c)(ii) hereof, as the case may be. If such
Lender shall pay such amount to the Agent together with such
interest, such amount so paid shall be deemed to constitute an
Advance by such Lender disbursed in respect of the reimbursement
obligation of the Company or other applicable Account Party under
Section 3.6(a) hereof for purposes of this Agreement, effective as
of the dates applicable under said Section 3.6(a). The failure of
any Lender to make its pro rata portion of any such amount paid by
the Agent available to the Agent shall not relieve any other Lender
of its obligation to
54
make available its pro rata portion of such amount, but no Lender
shall be responsible for failure of any other Lender to make such
pro rata portion available to the Agent. Furthermore, in the event
of the failure by Company or the Permitted Borrowers to pay the Gap
Interest required under the proviso to Section 3.6(a) hereof, each
of the Lenders shall pay to Agent, within one Business Day following
receipt from Agent of written request therefor, its pro rata portion
of said Gap Interest, excluding any portion thereof attributable to
the Applicable Margin.
Notwithstanding the foregoing however, no Lender shall acquire a pro rata
risk participation in a Letter of Credit or related Letter of Credit Payment if
the Agent had obtained actual knowledge that an Event of Default had occurred
and was continuing at the time of the issuance of such Letter of Credit;
provided, however that each Lender shall acquire a pro rata risk participation
in such Letter of Credit and the related Letter of Credit Payment upon the date
on which such Event of Default is waived by the Required Lenders or all Lenders,
as applicable.
(d) Nothing in this Agreement shall be construed to require or authorize
any Lender to issue any Letter of Credit, it being recognized that
the Agent shall be the sole issuer of Letters of Credit under this
Agreement.
3.7 Obligations Irrevocable. The obligations of Company and any other
Account Party to make payments to Agent or the Lenders with respect to Letter of
Credit Obligations under Section 3.6 hereof, shall be unconditional and
irrevocable and not subject to any qualification or exception whatsoever,
including, without limitation:
(a) Any lack of validity or enforceability of any Letter of Credit or
any documentation relating to any Letter of Credit or to any
transaction related in any way to any Letter of Credit (the "Letter
of Credit Documents");
(b) Any amendment, modification, waiver, consent, or any substitution,
exchange or release of or failure to perfect any interest in
collateral or security, with respect to or under any of the Letter
of Credit Documents;
(c) The existence of any claim, setoff, defense or other right which the
Company or any other Account Party may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any
persons or entities for whom any such beneficiary or any such
transferee may be acting), the Agent or any Lender or any other
person or entity, whether in connection with any of the Letter of
Credit Documents, the transactions contemplated herein or therein or
any unrelated transactions;
(d) Any draft or other statement or document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate
in any respect;
(e) Payment by the Agent to the beneficiary under any Letter of Credit
against presentation of documents which do not comply with the terms
of such Letter of
55
Credit, including failure of any documents to bear any reference or
adequate reference to such Letter of Credit;
(f) Any failure, omission, delay or lack on the part of the Agent or any
Lender or any party to any of the Letter of Credit Documents to
enforce, assert or exercise any right, power or remedy conferred
upon the Agent, any Lender or any such party under this Agreement,
any of the other Loan Documents or any of the Letter of Credit
Documents, or any other acts or omissions on the part of the Agent,
any Lender or any such party; or
(g) Any other event or circumstance that would, in the absence of this
Section 3.7, result in the release or discharge by operation of law
or otherwise of Company or any other Account Party from the
performance or observance of any obligation, covenant or agreement
contained in Section 3.6 hereof.
No setoff, counterclaim, reduction or diminution of any obligation or any
defense of any kind or nature which Company or any other Account Party has or
may have against the beneficiary of any Letter of Credit shall be available
hereunder to Company or any other Account Party against the Agent or any Lender.
Nothing contained in this Section 3.7 shall be deemed to prevent Company or the
other Account Parties, after satisfaction in full of the absolute and
unconditional obligations of Company and any other Account Parties hereunder,
from asserting in a separate action any claim, defense, set off or other right
which they (or any of them) may have against Agent or any Lender.
3.8 Risk Under Letters of Credit. (a) In the administration and handling
of Letters of Credit and any security therefor, or any documents or instruments
given in connection therewith, Agent shall have the sole right to take or
refrain from taking any and all actions under or upon the Letters of Credit.
(b) Subject to other terms and conditions of this Agreement, Agent shall
issue the Letters of Credit and shall hold the documents related
thereto in its own name and shall make all collections thereunder
and otherwise administer the Letters of Credit in accordance with
Agent's regularly established practices and procedures and, except
pursuant to Section 12.3 hereof, Agent will have no further
obligation with respect thereto. In the administration of Letters of
Credit, Agent shall not be liable for any action taken or omitted on
the advice of counsel, accountants, appraisers or other experts
selected by Agent with due care and Agent may rely upon any notice,
communication, certificate or other statement from Company, any
Account Party, beneficiaries of Letters of Credit, or any other
Person which Agent believes to be authentic. Agent will, upon
request, furnish the Lenders with copies of Letter of Credit
Agreements, Letters of Credit and documents related thereto.
(c) In connection with the issuance and administration of Letters of
Credit and the assignments hereunder, Agent makes no representation
and shall have no responsibility with respect to (i) the obligations
of Company or any Account Party or the validity, sufficiency or
enforceability of any document or instrument given
56
in connection therewith, or the taking of any action with respect to
same, (ii) the financial condition of, any representations made by,
or any act or omission of, Company, any other applicable Account
Party or any other Person, or (iii) any failure or delay in
exercising any rights or powers possessed by Agent in its capacity
as issuer of Letters of Credit in the absence of its gross
negligence or willful misconduct. Each of the Lenders expressly
acknowledges that they have made and will continue to make their own
evaluations of Company's and the Account Parties' creditworthiness
without reliance on any representation of Agent or Agent's officers,
agents and employees.
(d) If at any time Agent shall recover any part of any unreimbursed
amount for any draw or other demand for payment under a Letter of
Credit, or any interest thereon, Agent shall receive same for the
pro rata benefit of the Lenders in accordance with their respective
Percentages and shall promptly deliver to each Lender its share
thereof, less such Lender's pro rata share of the costs of such
recovery, including court costs and attorney's fees. If at any time
any Lender shall receive from any source whatsoever any payment on
any such unreimbursed amount or interest thereon in excess of such
Lender's Percentage of such payment, such Lender will promptly pay
over such excess to Agent, for redistribution in accordance with
this Agreement.
3.9 Indemnification. (a) The Company and each other Account Party hereby
indemnifies and agrees to hold harmless the Lenders and the Agent, and their
respective officers, directors, employees and agents, from and against any and
all claims, damages, losses, liabilities, costs or expenses of any kind or
nature whatsoever which the Lenders or the Agent or any such person may incur or
which may be claimed against any of them by reason of or in connection with any
Letter of Credit, and neither any Lender nor the Agent or any of their
respective officers, directors, employees or agents shall be liable or
responsible for: (i) the use which may be made of any Letter of Credit or for
any acts or omissions of any beneficiary in connection therewith; (ii) the
validity, sufficiency or genuineness of documents or of any endorsement thereon,
even if such documents should in fact prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (iii) payment by the Agent to the
beneficiary under any Letter of Credit against presentation of documents which
do not comply with the terms of any Letter of Credit (unless such payment
resulted from the gross negligence or willful misconduct of the Agent); (iv) 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; or (v) any other event or circumstance whatsoever arising in connection
with any Letter of Credit; provided, however, that Company and any other Account
Parties shall not be required to indemnify the Lenders and the Agent and such
other persons, and the Agent shall be liable to the Company and any other
Account Parties to the extent, but only to the extent, of any direct, as opposed
to consequential or incidental, damages suffered by Company and any other
Account Parties which were caused by the Agent's gross negligence, willful
misconduct or wrongful dishonor of any Letter of Credit after the presentation
to it by the beneficiary thereunder of a draft or other demand for payment and
other documentation strictly complying with the terms and conditions of such
Letter of Credit.
57
(b) It is understood that in making any payment under a Letter of Credit
the Agent will rely on documents presented to it under such Letter
of Credit as to any and all matters set forth therein without
further investigation and regardless of any notice or information to
the contrary. It is further acknowledged and agreed that Company or
other Account Party may have rights against the beneficiary or
others in connection with any Letter of Credit with respect to which
Agent or the Lenders are alleged to be liable and it shall be a
condition of the assertion of any liability of Agent or the Lenders
by the Company or any other Account Party under this Section that
Company or the other applicable Account Party shall
contemporaneously pursue all remedies in respect of the alleged loss
against such beneficiary and any other parties obligated or liable
in connection with such Letter of Credit and any related
transactions.
3.10 Right of Reimbursement. Each Lender agrees to reimburse the Agent on
demand, pro rata in accordance with its respective Percentage, for (i) the
reasonable out-of-pocket costs and expenses of the Agent to be reimbursed by
Company or any other Account Party pursuant to any Letter of Credit Agreement or
any Letter of Credit, to the extent not reimbursed by Company or any other
Account Party and (ii) any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, fees, reasonable out-of-pocket
expenses or disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against Agent (in its capacity as issuer of any
Letter of Credit) in any way relating to or arising out of this Agreement, any
Letter of Credit, any documentation or any transaction relating thereto, or any
Letter of Credit Agreement, to the extent not reimbursed by Company or any
Account Party, except to the extent that such liabilities, losses, costs or
expenses were incurred by Agent as a result of Agent's gross negligence or
willful misconduct or by the Agent's wrongful dishonor of any Letter of Credit
after the presentation to it by the beneficiary thereunder of a draft or other
demand for payment and other documentation strictly complying with the terms and
conditions of such Letter of Credit.
3.11 Existing Letters of Credit. Each Existing Letter of Credit shall be
deemed for all purposes of this Agreement to be a Letter of Credit, and each
application or other documentation submitted in connection with each Existing
Letter of Credit shall be deemed for all purposes of this Agreement to be a
Letter of Credit Agreement. On the date of execution of this Agreement, the
Agent shall be deemed automatically to have sold and transferred, and each other
Lender shall be deemed automatically, irrevocably, and unconditionally to have
purchased and received from the Agent, without recourse or warranty, an
undivided interest and participation (on the terms set forth herein), to the
extent of such other Lender's Percentage, in each Existing Letter of Credit and
the applicable Letter of Credit Obligations with respect thereto and any
security therefor or guaranty pertaining thereto. Letter of Credit Fees paid
under the Prior Credit Agreement shall not be recalculated, redistributed or
reallocated by Agent to the Lenders; provided that the Company shall pay to any
new Lenders becoming parties hereto on the Effective Date (or any existing
Lender increasing its Percentage on such date) a special letter of credit fee on
the Existing Letters of Credit, calculated on the basis of the Letter of Credit
Fees which would be applicable to such Existing Letters of Credit if issued on
the Effective Date (but in the case of any existing Lender, computed only to the
extent of the applicable increase in its Percentage) for the period from the
Effective Date to the expiration date of such Existing Letters of Credit.
58
4. MARGIN ADJUSTMENTS.
4.1 Margin Adjustments. Adjustments to the Applicable Margin and the
Applicable Fee Percentages, based on Schedule 4.1, shall be implemented on a
quarterly basis as follows: such adjustments shall be given prospective effect
only, effective as to all Advances outstanding hereunder and as to each
Applicable Fee Percentage, upon the date of delivery of the financial statements
under Sections 7.3(b) and 7.3(c) hereunder, in each case establishing
applicability of the appropriate adjustment, in each case with no retroactivity
or claw-back.
4.2 Margins. In the event Company fails timely to deliver the financial
statements required under Section 7.3(b) or 7.3(c), then from the date delivery
of such financial statements was required until such financial statements are
delivered, the margins and fee percentages shall be at the highest level on the
Pricing Matrix attached to this Agreement as Schedule 4.1.
5. CONDITIONS.
The obligations of Lenders to make Advances or to issue Letters of Credit,
pursuant to this Agreement are subject to the following conditions, provided
however that Sections 5.1 through 5.9 below shall only apply to the initial
Advances or Letters of Credit hereunder:
5.1 Execution of this Agreement and the other Loan Documents. The Company
and the Permitted Borrowers shall have executed and delivered to the Agent for
the account of each Lender, this Agreement (including all schedules, exhibits,
certificates, opinions, financial statements and other documents to be delivered
pursuant hereto) and the other Loan Documents, and, this Agreement and the other
Loan Documents shall be in full force and effect.
5.2 Corporate Authority. Agents shall have received (i) certified copies
of resolutions of the Board of Directors of the Company, the Permitted
Borrowers, Vishay Asia and each of the Significant Subsidiaries party to any
Loan Document evidencing approval of the form of this Agreement and each of the
other Loan Documents to which such Person is a party and authorizing the
execution and delivery thereof and, if applicable, the borrowing of Advances and
requesting of Letters of Credit hereunder; (ii) (A) certified copies of the
Company's, the Permitted Borrowers, Vishay Asia and the Significant
Subsidiaries' articles of incorporation and bylaws or other constitutional
documents certified as true and complete as of a recent date by the appropriate
official of the jurisdiction of incorporation of each such entity (or, if
unavailable in such jurisdiction, by a responsible officer of such entity); and
(B) a certificate of good standing from the state or other jurisdictions of the
Company's incorporation, and from the applicable states of incorporation or
other jurisdictions of the Permitted Borrowers, Vishay Asia, the Significant
Subsidiaries and from every state or other jurisdiction in which the Company,
the Permitted Borrowers, Vishay Asia or any of such Significant Subsidiaries is
qualified to do business, if issued by such jurisdictions, subject to the
limitations (as to qualification and authorization to do business) contained in
Section 6.1, hereof.
5.3 Collateral Documents and Guaranties.
(a) The Agent shall have received the Domestic Guaranty, an amended and
restated Pledge Agreement (pledging the share capital of each of the
Significant Domestic Subsidiaries) executed by the Company and
certain of the Significant Domestic
59
Subsidiaries as well as stock certificates and blank stock powers
for all shares subject to such Pledge Agreement;
(b) The Agent shall have received a Reaffirmation of Certain Loan
Documents or such new or updated Pledge Agreements and/or Guaranties
as the Agent determines necessary executed by the Foreign Permitted
Borrowers, Vishay Asia and the other Significant Foreign
Subsidiaries in connection with those Pledge Agreements and the
Foreign Guaranties as previously executed and delivered to Agent;
and
(c) Company and each of the Significant Domestic Subsidiaries shall have
previously executed and delivered the Security Agreement or joined
thereto and any documents (including, without limitation, financing
statements, amendments to financing statements and assignments of
financing statements) required to be filed in connection with the
Security Agreement to create, in favor of the Agent (for and on
behalf of the Lenders), a perfected security interest in the
Collateral thereunder shall have been delivered to the Agent in a
proper form for filing in each office in each jurisdiction listed in
Schedule 5.3, or other office, as the case may be; provided,
however, (i) that the Company shall have a period of ninety days
following the Effective Date to deliver, or cause to be delivered,
documentation satisfactory to the Agent to perfect the security
interest and lien in patents, trademarks and other intellectual
property and proprietary rights, and (ii) that the Company shall
have a period of thirty days following the Effective Date to
deliver, or cause to be delivered, the joinders of Vishay Infared
Components, Inc., Vishay Cera-mite, Inc., Vishay BLH, Inc., and
Vishay Transducers Ltd. to the Security Agreement and any related
documents required to perfect a security interest in the Collateral
thereunder.
5.4 Representations and Warranties -- All Parties. The representations and
warranties made by the Company, each of the Significant Subsidiaries or any
other party to any of the Loan Documents under this Agreement or any of the
other Loan Documents (excluding the Agents and the Lenders), and the
representations and warranties of any of the foregoing which are contained in
any certificate, document or financial or other statement furnished at any time
hereunder or thereunder or in connection herewith or therewith shall have been
true and correct in all material respects when made and shall be true and
correct in all material respects on and as of the date of the making of the
initial Advance hereunder.
5.5 Compliance with Certain Documents and Agreements. The Company and the
Significant Subsidiaries (and any of their respective Subsidiaries or
Affiliates) shall have each performed and complied with all agreements and
conditions contained in this Agreement, the other Loan Documents, or any
agreement or other document executed hereunder or thereunder and required to be
performed or complied with by each of them (as of the applicable date) and none
of such parties shall be in default in the performance or compliance with any of
the terms or provisions hereof or thereof.
5.6 Opinion of Counsel. The Company, the Permitted Borrowers and the
Significant Subsidiaries, to the extent applicable, shall furnish the opinions
of counsel listed on Schedule 5.6
60
hereto, such opinions to be substantially in the form of the opinions of counsel
previously delivered under the Prior Credit Agreement, with such changes as
shall be acceptable to Agent.
5.7 Certificates. The Agent shall have received a the following
certificates: (a) a certificate of an Authorized Officer, dated the date of the
making of the initial Advances or the issuance of the initial Letters of Credit
hereunder stating that the conditions of paragraphs 5.4, 5.5, 5.9, and 5.11
hereof have been fully satisfied, (b) casualty and liability insurance
certificates for the Company and each Significant Domestic Subsidiary in form
and substance acceptable to the Agent, and (c) insurance disclosure certificates
for the Company and each Significant Domestic Subsidiary in form and substance
acceptable to the Agent.
5.8 Payment of Agent's and Other Fees. Company shall have paid to Agent,
for distribution to the Lenders under the Prior Credit Agreement (based on the
Percentages in effect under the Prior Credit Agreement) the Facility Fee accrued
under the Prior Credit Agreement to the Effective Date of this Agreement. In
addition, Company shall have paid to the Agents (for Agents' sole accounts), the
Agent's Fees and all costs and expenses required hereunder, and any related
Letter of Credit Fees as required under Section 3.11 hereof.
5.9 New Convertible Subordinated Debt. The Additional Debt Issuance Date
shall have occurred and the Company shall have received the proceeds of the New
Convertible Subordinated Debt in an amount not less than $400,000,000, and in
connection therewith, the Company shall have delivered to Agent copies of any
documents related thereto which the Agent may reasonably request, including
copies of all notices for prepayment or redemption issued in order for the
Company to prepay or redeem the outstanding General Semiconductor Notes.
5.10 Other Documents and Instruments. The Agents shall have received, with
a photocopy for each Lender, such other instruments and documents as the
Required Lenders may reasonably request in writing in connection with the making
of Advances or the issuing of any Letters of Credit hereunder, and all such
instruments and documents shall be satisfactory in form and substance to the
Agents and the Required Lenders.
5.11 Continuing Conditions. The obligations of the Lenders to make any of
the Advances or loans or of the Agent to issue any Letters of Credit under this
Agreement, including but not limited to the initial Advances of the Revolving
Credit or the Swing Line hereunder, shall be subject to the following continuing
conditions:
(a) No Default or Event of Default shall have occurred and be continuing
as of the making of the proposed Advance (both before and after
giving effect thereto);
(b) The representations and warranties contained in this Agreement and
the other Loan Documents are true and correct in all material
respects as of the making of the applicable Advance; and
(c) There shall have been no material adverse change in the condition
(financial or otherwise), properties, business, results or
operations of the Company and its Subsidiaries (taken as a whole)
from December 31, 2002 (or any subsequent December 31st, if the
Agent determines, with the concurrence of the Required Lenders,
based on the Company's financial statements for such subsequent
fiscal
61
year that no material adverse change has occurred during such year,
such determination being made solely for purposes of determining the
applicable date under this paragraph) to the date of the proposed
Advance hereunder.
6. REPRESENTATIONS AND WARRANTIES
Company and the Permitted Borrowers represent and warrant and such
representations and warranties as applicable shall be deemed to be continuing
representations and warranties during the entire life of this Agreement:
6.1 Corporate Existence. The Company and each of the Significant
Subsidiaries is duly organized and validly existing in good standing under the
laws of the applicable jurisdiction of organization, charter or incorporation;
the Company and each of the Significant Subsidiaries is duly qualified and
authorized to do business in each jurisdiction where the character of its assets
or the nature of its activities makes such qualification necessary, except where
such failure to qualify and be authorized to do business will not have a
material adverse impact on the Company and its Subsidiaries, taken as a whole.
6.2 Due Authorization -- Company. Execution, delivery and performance of
this Agreement, the other Loan Documents, and any other documents and
instruments required under or in connection with this Agreement, and extensions
of credit to the Company are within its corporate or other organizational
powers, have been duly authorized, are not in contravention of law or the terms
of the Company's certificate of incorporation or bylaws or other organic
documents, and, except as have been previously obtained or as referred to in
Section 6.15, below, do not require the consent or approval, material to the
transactions contemplated by this Agreement, or the Loan Documents, of any
governmental body, agency or authority.
6.3 Due Authorization -- Significant Subsidiaries. Execution, delivery and
performance of this Agreement, the other Loan Documents, and any other documents
and instruments required under or in connection with this Agreement by each of
the Significant Subsidiaries, and extensions of credit to Permitted Borrowers,
are (or will be, on the applicable date of delivery of such Loan Documents)
within their respective corporate or other organizational powers, have been (or
will be, as aforesaid) duly authorized, are not (or will not be, as aforesaid)
in contravention of law or the terms of their articles of incorporation or
bylaws or other organic documents of the parties thereto, as applicable, and,
except as have been previously obtained (or as referred to in Section 6.15,
below), do not (or will not, as aforesaid) require the consent or approval,
material to the transactions contemplated by this Agreement, or the other Loan
Documents, of any governmental body, agency or authority.
6.4 Title to Material Property. Each of the Company and each of the
Significant Subsidiaries has good and valid title to the property owned by it,
which property (individually or in the aggregate) is material to the business or
operations of the Company and its Subsidiaries, taken as a whole, excluding
imperfections in title not material to the ownership, use and/or enjoyment of
any such property.
62
6.5 Encumbrances. There are no security interests in, Liens, mortgages or
other encumbrances on and no financing statements on file with respect to any
property of Company or any of the Subsidiaries, except for those Liens permitted
under Section 8.5 hereof.
6.6 Subsidiaries. As of the Effective Date, there are no directly or
indirectly owned Subsidiaries of the Company, except for those Subsidiaries
identified in Schedule 6.6, attached hereto.
6.7 Taxes. The Company and its Subsidiaries each has filed on or before
their respective due dates, all federal, state and foreign tax returns which are
required to be filed or has obtained extensions for filing such tax returns and
is not delinquent in filing such returns in accordance with such extensions and
has paid all taxes which have become due pursuant to those returns or pursuant
to any assessments received by any such party, as the case may be, to the extent
such taxes have become due, except (a) where the failure to file tax returns or
pay taxes shall not have a material adverse effect on the Company and its
Subsidiaries taken as a whole, or (b) to the extent such tax payments are being
actively contested in good faith by appropriate proceedings and with respect to
which adequate provision has been made on the books of the Company or its
Subsidiaries, as applicable, as may be required by GAAP.
6.8 No Defaults. There exists no default under the provisions of any
instrument evidencing any permitted Debt of the Company or its Subsidiaries or
connected with any of the Permitted Company Encumbrances or the Permitted
Encumbrances of the Subsidiaries, or of any agreement relating thereto, except
where such default would not have a material adverse effect on the Company and
its Subsidiaries taken as a whole and would not violate this Agreement or any of
the other Loan Documents according to the terms thereof.
6.9 Compliance with Laws. The Company and its Significant Subsidiaries
each has complied with all applicable laws, including without limitation,
Hazardous Material Laws, to the extent that failure to comply therewith would
materially interfere with the conduct of the business of the Company or any of
its Subsidiaries taken as a whole, or would have a material adverse effect upon
Company or any of its Subsidiaries taken as a whole, or upon any property
(whether personal or real) owned by any of them.
6.10 Enforceability of Agreement and Loan Documents. (a) This Agreement
and each of the other Loan Documents to which the Company is a party, including
without limitation, all other certificates, agreements and documents executed
and delivered by Company under or in connection herewith or therewith have each
been duly executed and delivered by duly Authorized Officers of the Company and
constitute the valid and binding obligations of the Company, enforceable in
accordance with their respective terms, except as enforcement thereof may be
limited by applicable bankruptcy, reorganization, insolvency, moratorium or
similar laws affecting the enforcement of creditor's rights generally and by
general principles of equity (whether enforcement is sought in a proceeding in
equity or at law).
(b) This Agreement and each of the other Loan Documents to which any of
the Subsidiaries is a party, and all certificates, documents and
agreements executed in connection herewith or therewith by the
Subsidiaries have each been duly executed and delivered by duly
Authorized Officers of the applicable Subsidiary
63
and constitute the valid and binding obligations of the
Subsidiaries, enforceable in accordance with their respective terms,
except as enforcement thereof may be limited by applicable
bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by
general principles of equity (whether enforcement is sought in a
proceeding in equity or at law).
6.11 Non-contravention -- Company. The execution, delivery and performance
of this Agreement and the other Loan Documents and any other documents and
instruments required under or in connection with this Agreement by the Company
are not in contravention of the terms of any indenture, material agreement or
material undertaking to which the Company is a party or by which it or its
properties are bound or affected, except to the extent such terms have been
waived or are not material to the transactions contemplated by this Agreement
and the other Loan Documents or to the financial performance of the Company and
its Subsidiaries, taken as a whole.
6.12 Non-contravention -- Other Parties. The execution, delivery and
performance of this Agreement, those other Loan Documents signed by any of the
Subsidiaries, and any other documents and instruments required under or in
connection with this Agreement by any of the Subsidiaries are not in
contravention of the terms of any indenture, material agreement or material
undertaking to which any of the Subsidiaries is a party or by which it or its
properties are bound or affected, except to the extent such terms have been
waived or are not material to the transactions contemplated by this Agreement
and the other Loan Documents or to the financial performance of the Company and
its Subsidiaries, taken as a whole.
6.13 No Litigation -- Company. There is no suit, action, proceeding,
including, without limitation, any bankruptcy proceeding, or governmental
investigation pending against or, to the best knowledge of the Company,
threatened or otherwise affecting the Company (other than any suit, action or
proceeding in which the Company is the plaintiff and in which no counterclaim or
cross-claim against Company has been filed), nor has the Company or any of its
officers or directors been subject to any suit, action, proceeding or
governmental investigation as a result of which any such officer or director is
or may be entitled to indemnification by Company, except as otherwise disclosed
in Schedule 6.13 attached hereto and except for miscellaneous suits, actions and
proceedings which (i) do not have a reasonable likelihood of being adversely
determined or (ii) have a reasonable likelihood of being adversely determined
but, if resolved adversely to the Company would not in the aggregate have a
material adverse effect on the Company and its Subsidiaries, taken as a whole.
Except as so disclosed, there is not outstanding against the Company any
judgment, decree, injunction, rule, or order of any court, government,
department, commission, agency, instrumentality or arbitrator, nor, to the best
knowledge of the Company, is the Company in violation of any applicable law,
regulation, ordinance, order, injunction, decree or requirement of any
governmental body or court where such judgment, decree, injunction, rule, order
or violation would have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
6.14 No Litigation -- Other Parties. There is no suit, action, proceeding
(other than any suit, action or proceeding in which any such party is the
plaintiff and in which no counterclaim or cross-claim against any such party has
been filed), including, without limitation,
64
any bankruptcy proceeding, or governmental investigation pending against or, to
the best knowledge of the Company, threatened or otherwise affecting any of the
Subsidiaries nor has any such party or any of its officers or directors been
subject to any suit, action, proceeding or governmental investigation as a
result of which any such officer or director is or may be entitled to
indemnification by such party, except as otherwise disclosed in Schedule 6.14
attached hereto and except for miscellaneous suits, actions and proceedings
which (i) do not have a reasonable likelihood of being adversely determined, or
(ii) have a reasonable likelihood of being adversely determined but, if resolved
adversely to such party, would not in the aggregate have a material adverse
effect on the Company and its Subsidiaries, taken as a whole. Except as so
disclosed, there is not outstanding against any such party any judgment, decree,
injunction, rule, or order of any court, government, department, commission,
agency, instrumentality or arbitrator nor, to the best knowledge of the Company,
is any such party in violation of any applicable law, regulation, ordinance,
order, injunction, decree or requirement of any governmental body or court where
such judgment, decree, injunction, rule or order or violation would have a
material adverse effect on the Company and its Subsidiaries, taken as a whole.
6.15 Consents, Approvals and Filings, Etc. Except as have been previously
obtained, no authorization, consent, approval, license, qualification or formal
exemption from, nor any filing, declaration or registration with, any court,
governmental agency or regulatory authority or any securities exchange or any
other person or party (whether or not governmental) is required in connection
with the execution, delivery and performance: (i) by the Company, of this
Agreement, any of the other Loan Documents to which it is a party, or any other
documents or instruments to be executed and/or delivered by the Company in
connection therewith or herewith; (ii) by each of the Subsidiaries, of this
Agreement, the other Loan Documents to which it is a party or any other
documents or instruments to be executed and/or delivered by the Subsidiaries in
connection therewith or herewith; and (iii) by Company or any of its
Subsidiaries, of the liens, pledges, mortgages, security interests or other
encumbrances granted, conveyed or otherwise established (or to be granted,
conveyed or otherwise established) by or under this Agreement or other Loan
Documents, except for such filings to be made concurrently herewith as are
required by the Collateral Documents to perfect liens in favor of the Agent and
the Lenders. All such authorizations, consents, approvals, licenses,
qualifications, exemptions, filings, declarations and registrations which have
previously been obtained or made, as the case may be, are in full force and
effect and are not the subject of any attack, or to the knowledge of the
Company, threatened attack (in any material respect) by appeal or direct
proceeding or otherwise.
6.16 Agreements Affecting Financial Condition. Neither the Company, nor
any of its Subsidiaries is, as of the Effective Date, party to any agreement or
instrument or subject to any charter or other corporate restriction which
materially adversely affects the financial condition or operations of the
Company and its Subsidiaries, taken as a whole.
6.17 No Investment Company; No Margin Stock. Neither the Company, nor any
of its Subsidiaries is engaged principally, or as one of its important
activities, directly or indirectly, in the business of extending credit for the
purpose of purchasing or carrying margin stock. None of the Letters of Credit
and none of the proceeds of any of the Advances will be used by Company or any
of the Subsidiaries to purchase or carry margin stock or will be made available
by the Company or any of the Subsidiaries in any manner to any other Person to
enable or assist such
65
Person in purchasing or carrying margin stock. Terms for which meanings are
provided in Regulation U of the Board of Governors of the Federal Reserve System
or any regulations substituted therefor, as from time to time in effect, are
used in this paragraph with such meanings. Neither the Company, nor any of its
Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
6.18 ERISA. Neither a Reportable Event which is material to the Company
and its Subsidiaries, taken as a whole, nor an Accumulated Funding Deficiency
(herein as defined in Section 412 of the Internal Revenue Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Pension Plan. Each
Pension Plan has complied in all material respects with the applicable
provisions of ERISA and the Internal Revenue Code and any applicable regulations
thereof (and, if applicable, any comparable foreign law provisions), except to
the extent that any noncompliance, individually or in the aggregate, would not
have a material adverse effect upon the Company and its Subsidiaries, taken as a
whole. No termination of a Pension Plan has occurred, and no Lien in favor of
the PBGC or a Pension Plan has arisen, during such five-year period. Neither the
Company nor any ERISA Affiliate has had a complete or partial withdrawal from
any Multiemployer Plan within the five year period prior to the date of this
Agreement, nor does the Company or any ERISA Affiliate presently intend to
completely or partially withdraw from any Multiemployer Plan. To the best of
Company's knowledge, no such Multiemployer Plan is in bankruptcy or
reorganization or insolvent. There is no pending or, to the best of Company's
knowledge, threatened litigation or investigation questioning the form or
operation of any Pension Plan, nor, to the best of the Company's knowledge, is
there any basis for any such litigation or investigation which if adversely
determined could have a material adverse effect upon the Company and its
Subsidiaries, taken as a whole, as of the valuation date most closely preceding
the date of this Agreement.
6.19 Environmental Matters and Safety Matters. Except as set forth on
Schedule 6.19: (a) The Company and each Subsidiary is in compliance with all
federal, state, provincial and local laws, ordinances and regulations relating
to safety and industrial hygiene or the environment, including without
limitation all applicable Hazardous Materials Laws in jurisdictions in which the
Company or any such Subsidiary owns or operates, a facility or site, or arranges
for disposal or treatment of Hazardous Materials, solid waste, or other wastes,
accepts for transport any Hazardous Materials, solid wastes or other wastes or
holds any interest in real property or otherwise, except for matters which,
individually or in the aggregate, would not have a material adverse effect upon
the financial condition or business of the Company and its Subsidiaries, taken
as a whole.
(b) All federal, state, provincial, local and foreign permits, licenses
and authorizations required for present or (to the best of the
Company's knowledge) past use of the facilities and other properties
or activities of the Company and each Subsidiary have been obtained,
are presently in effect, and there is and has been full compliance
with all such permits, licenses or authorizations, except, in all
cases, where the failure to comply with the foregoing would not have
a material adverse effect on the Company and its Subsidiaries taken
as a whole.
66
(c) No demand, claim, notice, suit (in law or equity), action,
administrative action, investigation or inquiry (including, without
limitation, the listing of any property by any domestic or foreign
governmental entity which identifies sites for remedial, clean-up or
investigatory action) whether brought by any governmental authority,
private person or entity or otherwise, arising under, relating to or
in connection with any applicable Hazardous Materials Laws is
pending or, to the best of the Company's knowledge, threatened
against the Company or any of its Subsidiaries in connection with
any real property in which the Company or any such Subsidiary holds
or, to the best of the Company's knowledge, has held an interest or
any present or, to the best of the Company's knowledge, past
operation of the Company or any such Subsidiary, except for such
matters which, individually or in the aggregate, would not have a
material adverse effect on the financial condition or business of
the Company and its Subsidiaries, taken as a whole.
(d) Neither the Company nor any of its Subsidiaries whether with respect
to present or, to the best of the Company's knowledge, past
operations or properties, (i) is, to the best of the Company's
knowledge, the subject of any federal or state investigation
evaluating whether any remedial action is needed to respond to a
release of any Hazardous Materials into the environment, (ii) has
received any notice of any Hazardous Materials in, or upon any of
its properties in violation of any applicable Hazardous Materials
Laws, or (iii) knows of any basis for any such investigation or
notice under, or the existence of a violation of, Hazardous
Materials Laws except for such matters which, individually or in the
aggregate, would not have a material adverse effect on the financial
condition or business of the Company and its Subsidiaries, taken as
a whole.
(e) No release, threatened release or disposal of Hazardous Materials,
solid waste or other wastes is occurring or has occurred on, under
or to any real property in which the Company or any of its
Subsidiaries holds any interest or performs any of its operations,
in violation of any applicable Hazardous Materials Laws, except for
any such matters which, individually or in the aggregate, would not
have a material adverse effect on the financial condition or
business of the Company and its Subsidiaries, taken as a whole.
6.20 Accuracy of Information. Each of the Company's audited or unaudited
financial statements furnished to Agents and the Lenders by the Company prior to
the date of this Agreement, is complete and correct in all material respects and
fairly presents the financial condition of the Company and its Subsidiaries,
taken as a whole, and the results of their operations for the periods covered
thereby; any projections of operations for future years previously furnished by
Company to Agents or the Lenders have been prepared as the Company's good faith
estimate of such future operations, taking into account all relevant facts and
matters known to Company; since December 31, 2002 there has been no material
adverse change in the financial condition of the Company or its Subsidiaries,
taken as a whole; neither the Company, nor any of its Subsidiaries has any
contingent obligations (including any liability for taxes) not disclosed by or
reserved against in the December 31, 2002 balance sheet which is likely to have
a material adverse effect on the Company and its Subsidiaries, taken as a whole.
67
7. AFFIRMATIVE COVENANTS
Company and each of the Permitted Borrowers covenants and agrees that it
will, and, as applicable, it will cause its Subsidiaries (excluding any Special
Purpose Subsidiaries and, for purposes of Section 7.1, any Subsidiary that is
not a Significant Subsidiary) to, so long as any of the Lenders are committed to
make any Advances or issue any Letters of Credit under this Agreement and
thereafter so long as any Indebtedness remains outstanding under this Agreement:
7.1 Preservation of Existence, Etc.
Except as otherwise specifically permitted hereunder, preserve and
maintain its corporate existence and such of its rights, licenses, and
privileges as are material to the business and operations conducted by it; and
qualify and remain qualified to do business in each jurisdiction in which such
qualification is material to the business and operations or ownership of
properties, in each case of the Company and its Subsidiaries, taken as a whole.
7.2 Keeping of Books. Keep proper books of record and account in which
full and correct entries shall be made of all of its financial transactions and
its assets and businesses so as to permit the presentation of the Consolidated
financial statements of the Company prepared in accordance with GAAP.
7.3 Reporting Requirements. Furnish Agent with copies for each Lender:
(a) as soon as possible, and in any event within five (5) calendar days
after becoming aware of the occurrence of each Default or Event of
Default, a written statement of the chief financial officer of the
Company (or in his/her absence, another Authorized Officer of the
Company) setting forth details of such Event of Default or event and
the action which the Company has taken or has caused to be taken or
proposes to take or cause to be taken with respect thereto;
(b) as soon as available, and in any event within one hundred twenty
(120) days after and as of the end of each of Company's fiscal
years, a detailed Consolidated audit report of Company certified to
by independent certified public accountants satisfactory to Lenders
together with an unaudited Consolidating report of Company and its
Subsidiaries certified by the chief financial officer of Company (or
in his/her absence, another Authorized Officer of the Company) as to
consistency (with prior financial reports and accounting periods),
accuracy and fairness of presentation, and a Covenant Compliance
Report;
(c) as soon as available, and in any event within sixty (60) days after
and as of the end of each of the first three quarters of each year,
a Consolidated and Consolidating balance sheet and a statement of
profit and loss and surplus reconciliation of Company and its
Subsidiaries certified by the chief financial officer of Company (or
in his/her absence, another Authorized Officer of the Company) as to
consistency (with prior financial reports and accounting periods),
accuracy and fairness of presentation, and a Covenant Compliance
Report.
68
(d) as soon as possible, and in any event within five (5) calendar days
after becoming aware (i) of any material adverse change in the
financial condition of the Company, any of its Significant
Subsidiaries or any of the Permitted Borrowers, a certificate of the
chief financial officer of Company (or in his/her absence, another
Authorized Officer of the Company) setting forth the details of such
change or (ii) of the taking by the Internal Revenue Service or any
foreign taxing jurisdiction of a tax position (verbal or written)
which could have a material adverse effect upon the Company or any
of its Subsidiaries (or any such tax position taken by the Company
or any of its Subsidiaries) setting forth the details of such
position and the financial impact thereof;
(e) (i) as soon as available, the Company's 8-K, 10-Q and 10-K Reports
filed with the federal Securities and Exchange Commission, and in
any event, with respect to the 10-Q Report, within sixty (60) days
of the end of each of the Company's fiscal quarters, and with
respect to the 10-K Report, within one hundred twenty (120) days
after the end of each of Company's fiscal years; and (ii) as soon as
available, copies of all filings, reports or other documents filed
by the Company or any of its Subsidiaries with the federal
Securities and Exchange Commission or, as the Agent may reasonably
request, other federal regulatory or taxing agencies or authorities
in the United States, or comparable agencies or authorities in
England, Canada, France, Germany, the Netherlands or Israel, or any
stock exchanges in such jurisdictions;
(f) promptly as issued, all press releases, notices to shareholders and
all other material communications transmitted by the Company or any
of its Subsidiaries to the Company's stockholders generally, and
promptly following a Permitted Securitization, copies of the
principal transaction documents relating to such Permitted
Securitization;
(g) together with the financial statements delivered pursuant to Section
7.3(b) hereof, annual financial projections for the Company and its
Significant Subsidiaries covering the period at least through
Revolving Credit Maturity Date then in effect and otherwise in form
and content reasonably acceptable to the Agent and the Lenders;
(h) provide Agent (i) within 60 days of the end of each fiscal quarter,
with written evidence of the Moody's and S&P rating on the Company's
rated Senior Debt, and (ii) with written notice to Agent of any
changes in the Moody's or S&P rating on the Company's rated Senior
Debt within five (5) days of such change, and if such written notice
states that the rating by S&P has fallen below BB+ or the rating by
Moody's has fallen below Ba1, such written notice shall be
accompanied by an executed copy of the Reaffirmation of Security
Agreement in the form attached hereto as Exhibit L if any Liens have
been released pursuant to Section 13.21 hereof.
69
(i) promptly, and in form reasonably satisfactory to Agent and the
requesting Lender or Lenders, such other information as Agent or any
of the Lenders (acting through Agent) may request from time to time.
7.4 Tangible Net Worth. Maintain, on a Consolidated basis, as of the last
day of each fiscal quarter, beginning with the fiscal quarter ending June 30,
2003, Tangible Net Worth in an amount not less than Eight Hundred Fifty Million
Dollars ($850,000,000), plus the sum of the Net Income Adjustment and the Equity
Offering Adjustment.
7.5 Leverage Ratio. Maintain, as of the last day of each fiscal quarter
during the periods specified below, a Leverage Ratio of not more than the
following amounts during the periods specified below:
----------------------------------------------------------------
Period Ratio
----------------------------------------------------------------
Effective Date through December 30, 2003 3.50
----------------------------------------------------------------
December 31, 2003 through December 30, 2004 3.25
----------------------------------------------------------------
December 31, 2004 and thereafter 3.00
----------------------------------------------------------------
7.6 Fixed Charge Coverage Ratio. Maintain, as of the last day of each
fiscal quarter, a Fixed Charge Coverage Ratio of not less than 2.5 to 1.0.
7.6A Senior Debt Ratio. Maintain, as of the last day of each fiscal
quarter ending during the periods specified below, for the four fiscal quarters
then ending, a ratio of Senior Debt to Consolidated EBITDA of not more than the
following amounts during the periods specified below:
----------------------------------------------------------------
Period Ratio
----------------------------------------------------------------
Effective Date through December 30, 2003 1.75
----------------------------------------------------------------
December 31, 2003 and thereafter 1.50
----------------------------------------------------------------
7.7 Inspections. Permit Agent and each Lender, through their authorized
attorneys, accountants and representatives to examine Company's and each of the
Subsidiaries' books, accounts, records, ledgers and assets and properties of
every kind and description wherever located at all reasonable times during
normal business hours, upon oral or written request of Agent; and permit Agent
and each Lender or their authorized representatives, at reasonable times and
intervals, to visit all of its offices, discuss its financial matters with its
officers and independent certified public accountants, and by this provision
Company authorizes such accountants to discuss the finances and affairs of
Company and its Subsidiaries (provided that Company is given an opportunity to
participate in such discussions) and examine any of its or their books and other
corporate records. An examination of the records or properties of Company or any
of its Subsidiaries may require revealment of proprietary and/or confidential
data and information, and the Agent and each of the Lenders agrees upon request
of the inspected party to execute a confidentiality agreement (satisfactory to
Agent or the inspecting Lender, as the case may be, and such party) on behalf of
the Agent or such inspecting Lender and all parties making such inspections or
examinations under its authorization; provided however that such confidentiality
agreement shall not prohibit Agent from revealing such information to Lenders or
prohibit the inspecting Lender from revealing such information to Agent or
another Lender.
70
7.8 Taxes. Pay and discharge all taxes and other governmental charges, and
all material contractual obligations calling for the payment of money, before
the same shall become overdue, unless and to the extent only that such payment
is being contested in good faith by appropriate proceedings and is adequately
reserved for, as may be required by GAAP on its books, or where the failure to
pay any such matter would not have a material adverse effect on the Company and
its Subsidiaries, taken as a whole.
7.9 Further Assurances. Execute and deliver or cause to be executed and
delivered within a reasonable time following Agent's request, and at the
Company's expense, such other documents or instruments as Agent may reasonably
require to effectuate more fully the purposes of this Agreement or the other
Loan Documents.
7.10 Insurance. Maintain insurance coverage on its physical assets and
against other business risks in such amounts and of such types as are
customarily carried by companies similar in size and nature, and in the event of
acquisition of additional property, real or personal, or of occurrence of
additional risks of any nature, increase such insurance coverage in such manner
and to such extent as prudent business judgment and then current practice would
dictate; and with all said policies or copies thereof, including all
endorsements thereon and those required hereunder, to be deposited with the
Agent. In the case of all policies covering any Collateral, all such insurance
policies shall provide that the loss payable thereunder shall be payable to
Company and its Domestic Subsidiaries, as applicable, and the Agent for the
benefit of the Lenders (Agent as lender loss payee) as their respective
interests may appear. Upon the request of Agent or any Lender, certificates
evidencing such policies shall be delivered to Agent or such Lender, as the case
may be.
7.11 Indemnification. With respect to the Company, indemnify and save each
Agent and the Lenders harmless from all reasonable loss, cost, damage, liability
or expenses, including reasonable attorneys' fees and disbursements, incurred by
each of the Agents and the Lenders by reason of an Event of Default or enforcing
the obligations of the Company or the Permitted Borrowers under this Agreement,
or the other Loan Documents, or in the prosecution or defense of any action or
proceeding concerning any matter growing out of or connected with this
Agreement, or any of the other Loan Documents or any mortgage, stock pledge or
security agreement released by Agents or the Lenders from time to time
hereunder, or relating in any way to the imposition (or attempted imposition) on
Agents or Lenders (or any of them) of any liability for the violation of or
non-compliance by any Person (or purported violation or
71
non-compliance) with Hazardous Material Laws, other than in any case resulting
from the gross negligence or willful misconduct of Agents or the Lenders; and,
with respect to each of the Permitted Borrowers, indemnify and save each Agent
and the Lenders harmless from all reasonable loss, cost, damage, liability or
expenses, including reasonable attorneys' fees and disbursements, incurred by
each of the Agents and the Lenders with respect to a Permitted Borrower by
reason of an Event of Default or enforcing the obligations of the Permitted
Borrowers under this Agreement, or the other Loan Documents or in the
prosecution or defense of any action or proceeding concerning any matter growing
out of or connected with this Agreement, or any of the other Loan Documents or
any mortgage, stock pledge or security agreement released by Agents or the
Lenders from time to time hereunder, or relating in any way to the imposition
(or attempted imposition) on Agents or Lenders (or any of them) of any liability
for the violation of or non-compliance by any Person (or purported violation or
non-
72
compliance) with Hazardous Material Laws, other than in any case resulting from
the gross negligence or willful misconduct of Agents or the Lenders.
7.12 Governmental and Other Approvals. Apply for, obtain and/or maintain
in effect, as applicable, all material authorizations, consents, approvals,
licenses, qualifications, exemptions, filings, declarations and registrations
(whether with any court, governmental agency, regulatory authority, securities
exchange or otherwise) which are necessary in connection with the execution,
delivery and performance: (i) by the Company, of this Agreement, the Loan
Documents, or any other documents or instruments to be executed and/or delivered
by the Company in connection therewith or herewith; and (ii) by each of the
Significant Subsidiaries, of this Agreement and the Loan Documents.
7.13 Compliance with Contractual Obligations and Laws. Comply in all
material respects with all Contractual Obligations, and with all applicable
laws, rules, regulations and orders of any governmental authority, whether
federal, state, local or foreign (including without limitation Hazardous
Materials Laws), in effect from time to time, except to the extent that failure
to comply therewith could not reasonably be expected to have, individually or in
the aggregate, a material adverse effect on the business, operations, property
or financial or other condition of the Company and the Permitted Borrowers and
their respective Subsidiaries, taken as a whole, and could not reasonably be
expected to materially adversely affect the ability of the Company or any of the
Significant Subsidiaries to perform their respective obligations under any of
the Loan Documents to which they are a party.
7.14 ERISA. Comply in all material respects with all requirements imposed
by ERISA as presently in effect or hereafter promulgated or the Internal Revenue
Code (or comparable laws in applicable jurisdictions outside the United States
of America relating to foreign pension plans) and promptly notify Lenders upon
the occurrence of any of the following events:
(a) the termination of any Pension Plan pursuant to Subtitle C of Title
IV of ERISA or otherwise (other than any defined contribution plan
not subject to Section 412 of the Code and any Multiemployer Plan);
(b) the appointment of a trustee by a United States District Court to
administer any Pension Plan pursuant to ERISA;
(c) the commencement by the PBGC, or any successor thereto, of any
proceeding to terminate any Pension Plan;
(d) the failure of the Company or any ERISA Affiliate to make any
payment in respect of any Pension Plan required under Section 412 of
the Internal Revenue Code;
(e) the withdrawal of the Company or any ERISA Affiliate from any
Multiemployer Plan;
(f) the occurrence of an Accumulated Funding Deficiency or a Reportable
Event; or
73
(g) the occurrence of a Prohibited Transaction which could have a
material adverse effect upon the Company and its Subsidiaries, taken
as a whole.
7.15 Environmental Matters.
(a) (i) Not permit any of its property (whether real or personal, or any
portion thereof) to be involved in the use, generation, manufacture,
storage, disposal or transportation of Hazardous Material, except in
compliance with Hazardous Material Laws, and (ii) keep and maintain
all of its other property (whether real or personal, and any portion
thereof) in compliance with, and shall not cause or permit any
activity at or condition of the Collateral, or any of its other
property (whether real or personal, or any portion thereof) to be in
violation of any Hazardous Material Laws, unless the failure to
comply therewith or violation thereof will not materially adversely
affect the Company and its Subsidiaries, taken as a whole.
(b) Promptly notify the Agent in writing of: (i) any and all
enforcement, cleanup, removal or other governmental or regulatory
actions instituted or completed pursuant to any applicable Hazardous
Material Laws; (ii) any and all claims made by any Person against
the Company, any of its Subsidiaries, or the Permitted Borrowers, or
any of its other property (whether real or personal, or any portion
thereof) relating to damage, contribution, cost recovery,
compensation, loss or injury resulting from any Hazardous Material
which could reasonably be expected to have a material adverse effect
on the Company and its Subsidiaries, taken as a whole; and (iii)
Company's discovery of any occurrence or condition on any real
property or fixtures constituting a part of, adjoining or in the
vicinity of any of its property that could cause any such property
(or any part thereof) to be subject to any material restrictions on
the ownership, occupancy, transferability or use thereof under any
Hazardous Material Laws. The Agent, on behalf of the Lenders, shall
have the right to join and participate in, as a party if it or they
so elect, any legal proceedings or actions initiated in connection
with any of the matters described in subparagraphs (b) (i) or (b)
(ii), above, and the Company agrees to pay the Agent's reasonable
attorneys fees in connection therewith.
(c) Take any material remedial action as may be required under
applicable law in response to the presence of any Hazardous Material
on, under, or about any of its property (whether real or personal,
or any part thereof), and, pursuant thereto, may enter into
settlement agreements, consent decrees, or other compromises in
respect of any of the matters described in subparagraphs (b) (i)
through (iii), above, provided that, in each case, Company has given
Lenders not less than thirty (30) days prior written notice thereof,
except, however, in the event remedial action is necessary on an
emergency basis or is required by any governmental authority with
jurisdiction over the Company or its Subsidiaries, in which case the
Company shall provide Lenders with reasonable notice promptly
thereafter.
74
(d) Agent may retain (on its own behalf and on behalf of the Lenders,
but at Company's sole expense) such Environmental Auditors as
reasonably necessary to evaluate and/or confirm Company's
environmental responses, reports or other matters, including
Company's compliance with Hazardous Material Laws generally, under
this Section 7.15, or elsewhere herein.
7.16 Significant Subsidiaries.
(a) With respect to the share capital (or other ownership interests) of
each Person which is a Significant Foreign Subsidiary on the
Effective Date, within 120 days following the Effective Date (or 180
days in the case of Vishay Asia or General Semiconductor of Taiwan),
the Company shall execute or cause to be executed, and delivered to
the Agent a Pledge Agreement encumbering subject to Section 7.17
hereof with a first priority Lien, 65% of the share capital (or
other ownership interests) of each such Significant Foreign
Subsidiary, but only with respect to, and only to the extent of,
share capital or other ownership interests that is directly owned by
the Company and/or one or more of the Domestic Subsidiaries, to
secure the Indebtedness of the Company and the Domestic Permitted
Borrowers;
(b) (i) With respect to each Person which becomes a Significant Domestic
Subsidiary subsequent to the Effective Date, cause such new
Significant Domestic Subsidiary to execute and deliver to the Agent
(x) a Joinder Agreement whereby such Significant Domestic Subsidiary
becomes obligated as a Guarantor under the Domestic Guaranty and (y)
except where Liens for the benefit of the Agent and the Lenders are
not required on certain Collateral under the terms of Section 13.21
hereof, a Joinder Agreement whereby such Significant Domestic
Subsidiary becomes obligated under the applicable Security
Agreement, such documents to be executed and delivered within thirty
days of the date such Person becomes a Significant Subsidiary and
(ii) with respect to each Person which becomes a Significant Foreign
Subsidiary subsequent to the Effective Date or is a Significant
Foreign Subsidiary on the Effective Date, and is also a Significant
Foreign Subsidiary on the date of Agent's receipt of the applicable
FPB Advance Notice, (a) a Joinder Agreement whereby such Significant
Foreign Subsidiary becomes obligated as a Guarantor under the
Foreign Guaranty and (b) if such Significant Foreign Subsidiary is
incorporated under the laws of the United States of America, a
Security Agreement or a Joinder Agreement whereby such Significant
Foreign Subsidiary becomes obligated under the applicable Security
Agreement, as the case may be, such documents to be executed and
delivered within eighty days of the Agent's receipt of a FPB Advance
Notice; and
(c) (i) With respect to the share capital (or other ownership interests)
of each Person which becomes a Significant Foreign Subsidiary
subsequent to the Effective Date, within sixty days of the date such
Person becomes a Significant Foreign Subsidiary, the Company shall
execute, or cause to be executed, and deliver to the Agent a Pledge
Agreement encumbering subject to Section 7.17 hereof, with a first
priority Lien, 65% of the share capital (or other ownership
interests) of each such Significant Foreign Subsidiary, but only
with respect to, and only to the
75
extent of, share capital that is directly owned by the Company
and/or one or more Domestic Significant Subsidiaries, to secure the
Indebtedness of the Company and the Domestic Permitted Borrowers;
and (ii) with respect to the share capital (or other ownership
interests) of each Person which becomes a Significant Foreign
Subsidiary subsequent to the Effective Date, and with respect to
each Person which is a Significant Foreign Subsidiary on the
Effective Date and which also is a Significant Foreign Subsidiary on
the date of Agent's receipt of the applicable FPB Notice, within
eighty days of the Agent's receipt of a FPB Advance Notice, the
Company shall execute, or cause to be executed, and deliver to the
Agent a Pledge Agreement encumbering subject to Section 7.17 hereof,
with a first priority Lien on 65% of the share capital of each such
Significant Foreign Subsidiary, but only with respect to, and only
to the extent of, share capital that is directly owned by the
Company and/or one or more Domestic Subsidiaries, to secure the
Indebtedness of the Company and the Domestic Permitted Borrowers and
100% of the share capital of each such Significant Foreign
Subsidiary to the extent owned, directly or indirectly, by the
Company to secure the Indebtedness of the Foreign Permitted
Borrowers hereunder; and
(d) With respect to the share capital (or other ownership interests) of
each Person, which becomes a Significant Domestic Subsidiary
subsequent to the Effective Date, within thirty days of the date
such Person becomes a Significant Domestic Subsidiary, the Company
shall execute, or cause to be executed, and deliver to the Agent a
stock pledge encumbering, 100% of the share capital (or other
ownership interests) of each such Significant Domestic Subsidiary to
the extent owned, directly or indirectly, by the Company to secure
the Indebtedness of the Company and the Permitted Borrowers.
All Collateral Documents delivered pursuant to this Section shall be in
form satisfactory to the Agent and the Required Lenders, in their reasonable
discretion, together with such supporting documentation, including without
limitation financing statements, acknowledgments, stock powers, registrations
and like documents, corporate authority items, certificates and opinions of
counsel, as reasonably required by the Agent and the Required Lenders and the
Company shall take, or cause to be taken, such steps as are necessary or
advisable under applicable law to perfect the liens granted under clauses (a)
through (d) hereof.
7.17 Foreign Subsidiaries Security. (a) If, following a change in the
relevant sections of the Internal Revenue Code or the regulations, published
rulings, notices or other official pronouncements issued or promulgated
thereunder, counsel for the Company and the Permitted Borrowers acceptable to
the Required Lenders does not within 30 days after a request from the Agent or
the Required Lenders deliver evidence, in form and substance mutually
satisfactory to the Required Lenders and the Company, that, with respect to each
Significant Foreign Subsidiary whose entire share capital, to the extent owned,
directly or indirectly, by the Company has not been encumbered in favor of the
Lenders (i) a pledge of 66-2/3 % or more of the total combined voting power of
all classes of capital stock of such Foreign Subsidiary entitled to vote and
(ii) the entering into a guaranty in substantially the form of the Domestic
Guaranty by such Significant Foreign Subsidiary, in either such case would cause
such Significant Foreign Subsidiary's United States parent for Federal income
tax purposes to include in income all or a portion of the
76
undistributed earnings of such Significant Foreign Subsidiary as determined for
Federal income tax purposes, then in the case of a failure to deliver the
evidence described in clause (i) above, that portion of such Significant Foreign
Subsidiary's outstanding capital stock so issued by such Significant Foreign
Subsidiary not theretofore pledged pursuant to a Pledge Agreement shall, to the
extent owned, directly or indirectly, by the Company, be pledged to the Agent
for the benefit of the Lenders pursuant to a Pledge Agreement (or another pledge
agreement in substantially similar form, if needed) and, in the case of failure
to deliver the evidence described in clause (ii) above, such Significant Foreign
Subsidiary shall execute and deliver the Domestic Guaranty (or another guaranty
in substantially the same form, if needed), in each case to the extent that
entering into a Pledge Agreement or such Guaranty is permitted under the laws of
the respective foreign jurisdiction and all such documents delivered pursuant to
this Section 7.17 shall be satisfactory to the Required Lenders, provided,
however, that absent the occurrence and continuance of a Default or an Event of
Default, any pledge or Domestic Guaranty made or provided pursuant to this
Section 7.17 may be removed if counsel for the Company and the Permitted
Borrowers subsequently delivers evidence reasonably satisfactory to Agent and
the Required Lenders that such pledge or Domestic Guaranty would cause such
Significant Foreign Subsidiary's United States parent for Federal income tax
purposes to include all or a portion of the undistributed earnings of such
Significant Foreign Subsidiary, it being understood that the parties intend that
the share capital of any Foreign Subsidiary shall not be required to be pledged
and no Foreign Subsidiary shall be required to issue a Guaranty if and to the
extent that such Guaranty or Pledge Agreement would cause the Company or any
Domestic Subsidiary to be required to include in income (for Federal income tax
purposes) all or a portion of the undistributed earnings of such Foreign
Subsidiary.
(b) Upon written notice received from the Company that it wishes to
change its tax election with respect to a Subsidiary treated under
this Agreement as a Domestic Subsidiary by virtue of its status as a
disregarded entity under Section 956 of the Internal Revenue Code,
such that the Subsidiary, following such election, would be
considered as a Foreign Subsidiary hereunder, Agent and Lenders
agree (at Company's sole expense), so long as no Default or Event of
Default shall have occurred and be continuing, to enter into such
amendments or supplements to and/or releases of the Collateral
Documents as may be necessary to prevent such Foreign Subsidiary's
United States parent for federal income tax purposes from being
required to include in income all or a portion of the undistributed
earnings of such Foreign Subsidiary.
7.18 Siliconix. Upon the purchase or other acquisition of any additional
shares of stock of Siliconix, shall cause such shares to be encumbered as
security for the Indebtedness of the Company and the Permitted Borrowers
according to the terms of the applicable Pledge Agreement; and within thirty
(30) days of the date on which Siliconix shall become a 100% Subsidiary, cause
Siliconix to become a party, by execution of Joinder Agreements, to the Domestic
Guaranty and to the applicable Security Agreement in each case according to the
requirements set forth in Section 7.16 hereof.
7.19 Security and Defense of Collateral. Except while Liens for the
benefit of the Agent and the Lenders are not required on certain Collateral
under the terms of Section 13.21 hereof, take such actions as the Agent or the
Required Lenders may from time to time reasonably request to establish and
maintain first perfected security interests in and Liens on all of its
77
Collateral in favor of the Agent on behalf of the Lenders, subject only to Liens
permitted under Section 8.5 hereof; and defend the Collateral from any Liens
other than Liens permitted by Section 8.5.
7.20 Vishay Israel. Within forty-five (45) days following the end of each
fiscal year ending after the Effective Date, cause Vishay Israel to request from
Israel's Comptroller of Foreign Exchange authorization to increase the limit on
the Pledge Agreement executed and delivered by Vishay Israel encumbering the
shares of Vishay Europe, to the extent of any increases after the Effective Date
in the amount of Vishay Israel's investment in Vishay Europe and as soon as
reasonably practicable following receipt of such approval, execute and deliver
an amendment in form satisfactory to the Agent and the Required Lenders, in
their reasonable discretion, together with such supporting documentation,
including without limitation corporate authority items, certificates and
opinions of counsel, as reasonably required by the Agent and the Required
Lenders and the Company shall take, or cause to be taken, such steps as are
necessary or advisable under applicable law to perfect the liens granted under
such Pledge Agreement as amended thereby.
7.21 Prepayment of General Semiconductor Notes. Issue such notices of
prepayment or redemption ( the "Call Notices") to the holders of the General
Semiconductor Notes (or any trustee or other representative) as may be necessary
to allow the Company or its applicable Subsidiary to prepay or redeem, in their
entirety, all of the issued and outstanding General Semiconductor Notes
according to the terms thereof; and use certain of the proceeds of the New
Convertible Subordinated Debt (net of reasonable and customary costs and
expenses of issuance) to redeem, defease or otherwise prepay within 45 days of
the date of issuance of the Call Notices all outstanding principal, premium and
interest on the General Semiconductor Notes.
7.22 Use of Proceeds. Use the Advances of the Revolving Credit made to the
Company or any Permitted Borrower solely for general corporate purposes,
including without limitation working capital and acquisitions. None of the
proceeds of the Advances made under this Agreement will be used in violation of
any applicable law or regulation including, without limitation, Regulation U of
the Board of Governors of the Federal Reserve System.
8. NEGATIVE COVENANTS
Company and each of the Permitted Borrowers covenant and agree that, so
long as any of the Lenders are committed to make any Advances or issue any
Letters of Credit under this Agreement and thereafter so long as any
Indebtedness remains outstanding, it will not, and it will not allow its
Subsidiaries excluding, for purposes of Section 8.2, any Subsidiary that is not
a Significant Subsidiary, a Guarantor or any party obligated under any Security
Agreement or Pledge Agreement, to:
8.1 Capital Structure, Business Objects or Purpose. Except as otherwise
specifically permitted under this Agreement,
(a) purchase, acquire or redeem any of its capital stock (whether in
connection with the conversion of any Debt to stock or otherwise),
except for (i) non-vested stock granted to participants under the
Vishay Stock Plan (ii) repurchases by the
78
Company of its common stock in an aggregate amount, from and after
August 31, 2000, not to exceed five percent (5%) of Tangible Net
Worth (determined, in the case of each such repurchase of shares, on
the date of repurchase), and (iii) repurchases by Siliconix of its
common stock prior to the time that Siliconix becomes a Significant
Subsidiary, provided, however, that both before and after giving
effect to each such repurchase, no Default or Event of Default has
occurred and is continuing; and
(b) make any material change in its capital structure or in its general
business objects or purpose or enter into any business, directly or
through any Subsidiary except for those businesses in which the
Company and its Subsidiaries are engaged on the date of this
Agreement or other businesses in the electronic components industry
or which are directly related thereto which could reasonably be
expected to have a material adverse effect on (i) the Company and
the Subsidiaries taken as a whole or (ii) the rights or interests of
the Agent and Lenders hereunder.
8.2 Limitations on Fundamental Changes. Enter into any transaction of
merger, consolidation or amalgamation, or purchase or otherwise acquire or
become obligated for the purchase of all or substantially all of the assets,
business interests or shares of capital stock of any Person or in any other
manner effectuate an expansion of present business of the Company and its
Subsidiaries by acquisition or liquidate, wind up or dissolve itself (or suffer
any liquidation or dissolution), or convey, sell, lease, assign, transfer or
otherwise dispose of, all, substantially all or any part of its property,
business or assets, or make any material change in its present method of
conducting business, except:
(a) any Subsidiary may be merged or consolidated with or into the
Company (so long as Company shall be the continuing or surviving
corporation); any Domestic Subsidiary may be merged or consolidated
with or into any 100% Domestic Subsidiary (so long as such 100%
Domestic Subsidiary shall be the continuing or surviving
corporation); and any Foreign Subsidiary may be merged or
consolidated with or into any 100% Domestic Subsidiary or into any
100% Foreign Subsidiary (excluding Vishay Israel) so long as such
100% Domestic Subsidiary or such 100% Foreign Subsidiary shall be
the continuing or surviving corporation);
(b) any Subsidiary may sell, lease, transfer or otherwise dispose of any
or all of its assets (upon voluntary liquidation or otherwise) to
the Company;
(c) any Domestic Subsidiary may sell, lease, transfer or otherwise
dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to any other Domestic Subsidiary which is a 100%
Subsidiary and any Foreign Subsidiary may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to any Domestic Subsidiary or to any other
Foreign Subsidiary (excluding Vishay Israel), provided that such
Subsidiary is a 100% Subsidiary;
79
(d) any Person other than a Subsidiary may merge or consolidate with and
into the Company or any 100% Subsidiary (excluding Vishay Israel) so
long as (i) the Company or such 100% Subsidiary shall be the
surviving corporation and (ii) immediately before and immediately
after giving effect to such merger or consolidation, no Default or
Event of Default shall have occurred and be continuing;
(e) Permitted Transfers and any Permitted Securitization;
(f) other sales, transfers or other dispositions of any assets of the
Company and its Subsidiaries from and after the Effective Date in an
aggregate amount not to exceed (i) 15% of Tangible Net Worth in any
fiscal year and (ii) 20% of Tangible Net Worth for any period of
three consecutive fiscal years (or portion thereof) beginning with
fiscal year 2001, determined on the basis of Tangible Net Worth for
the fiscal quarter ending immediately prior to the date of
determination; and
(g) Permitted Acquisitions and, provided that no Default or Event of
Default has occurred and is continuing at the time of such
reorganization and restructuring, the PDD Restructuring.
8.3 Guaranties. Guarantee, endorse, or otherwise become liable for or upon
the obligations of others, except by endorsement of cash items for deposit in
the ordinary course of business and except for (i) the Guaranties, (ii)
guaranties by the Company of Hedging Obligations entered into by any Foreign
Subsidiary or of reimbursement obligations in respect of Special Letters of
Credit issued for the account of any Subsidiary, and (iii) guaranties of
indebtedness as set forth on Schedule 8.3 attached hereto or as permitted under
clauses (d), (e), (f) or (g) of Section 8.7 hereof and (iv) customary clean up
call provisions under any Permitted Securitization.
8.4 Debt. Become or remain obligated for any Debt for borrowed money, or
for any Debt incurred in connection with the acquisition of any property, real
or personal, tangible or intangible, except:
(a) Indebtedness to Lenders (or their Affiliates) hereunder, including
without limitation, Hedging Obligations and Special Letters of
Credit;
(b) Debt not otherwise permitted hereunder which is in existence as of
the Effective Date and disclosed on Schedule 8.4 attached hereto,
and any renewals or refinancing of such Debt in amounts not
exceeding the scheduled amounts (less any required amortization
according to the terms thereof), on terms no less favorable to the
Company and its Subsidiaries than in effect on the Effective Date
and otherwise in compliance with this Agreement, regardless of any
less favorable terms which may result from changes in market rates;
(c) current unsecured trade, utility or non-extraordinary accounts
payable arising in the ordinary course of business and any unsecured
letters of credit undertaken by such parties in the ordinary course
of business outside the United States of
80
America (and necessary under local customs and practices) to support
such accounts payable;
(d) purchase money Debt for fixed assets (including capitalized leases
or other non-cancelable leases having a term of 12 months or
longer), provided that the aggregate amount of all such purchase
money Debt outstanding at any time shall not exceed seven and
one-half percent (7.5%) of Tangible Net Worth;
(e) any Debt assumed pursuant to an acquisition conducted in compliance
with this Agreement, provided that such Debt was not entered into,
extended or renewed in contemplation of such acquisition and
provided further that the aggregate amount of all such Debt at any
time outstanding shall not exceed six percent (6%) of Tangible Net
Worth;
(f) Debt to third parties issued by any Foreign Subsidiary of the
Company in an aggregate amount at any time outstanding not to exceed
$55,000,000; provided that such Debt be issued and at all times
maintained on a pari passu basis with the Indebtedness, if any, of
such Foreign Subsidiary, or on a basis subordinate thereto, and
pursuant to documentation containing covenants not more restrictive
in the aggregate than the covenants contained in this Agreement (as
determined by the Agent and Required Lenders in their reasonable
discretion) and provided further, however, that immediately before
and immediately after such Debt is incurred, and giving effect
thereto, no Default or Event of Default has occurred and is
continuing (it being understood that for purposes of this Section
8.4(f), the granting of Liens which are permitted under Section 8.5
hereof shall not be deemed to constitute the entry into more
restrictive covenants or to be other than on a pari passu basis);
(g) Intercompany Loans, but only to the extent permitted under the other
applicable terms and limitations of this Agreement, including but
not limited to Section 8.7 hereof;
(h) unsecured Debt issued under Rule 144A of the Securities Act of 1933
or pursuant to a private placement in an aggregate amount for all
such Debt issued under this subparagraph (but without giving effect
to any repayments or principal reductions thereof) not to exceed Two
Hundred Million Dollars ($200,000,000); provided that such Debt be
issued and all times maintained on a basis subordinate hereto, and
pursuant to documentation containing covenants not more restrictive
in the aggregate than the covenants contained in this Agreement (as
determined by the Agent and the Required Lenders in their reasonable
discretion); provided further, however, that immediately before and
immediately after such Debt is incurred, and giving effect thereto,
no Default or Event of Default has occurred and is continuing; and
provided further that prior to or concurrently with the issuance of
such Debt, the Revolving Credit Aggregate Commitment is permanently
reduced by an amount equal to not less than 75% of the proceeds of
such Debt, net of normal and customary expenses of issuance payable
to third parties;
81
(i) any reimbursement obligations arising in connection with the letters
of credit described in Schedule 8.3 attached hereto; and
(j) the BCc Replacement Financing, the New Convertible Subordinated Debt
and any other Subordinated Debt disclosed on Schedule 8.13 attached
hereto.
8.5 Liens. Permit or suffer any Lien to exist on any of its properties,
real, personal or mixed, tangible or intangible, whether now owned or hereafter
acquired, except:
(a) Liens in favor of the Agent, as security for the Indebtedness
hereunder, and, including without limitation, any Indebtedness under
any Hedging Obligations or to secure Special Letters of Credit;
(b) purchase money security interests in fixed assets to secure purchase
money Debt permitted under Section 8.4(d) hereof, provided that such
security interest is created substantially contemporaneously with
the acquisition of such fixed assets and does not extend to any
property other than the fixed assets so financed;
(c) any lien securing third-party indebtedness assumed pursuant to any
Permitted Acquisition conducted in compliance with this Agreement,
provided that such lien is limited to the property so acquired and
was not entered into, extended or renewed in contemplation of such
acquisition;
(d) Permitted Company Encumbrances and Permitted Encumbrances of the
Subsidiaries;
(e) Liens securing Debt of a Foreign Subsidiary (and not supported by a
guaranty or a similar obligation by the Company or any Domestic
Subsidiary) for overdraft or similar credit facilities permitted
under clause (f) of Section 8.4 hereof encumbering cash or cash
equivalents owned by any Foreign Subsidiary that do not exceed, in
the aggregate, Thirty Million Dollars ($30,000,000);
(f) Liens securing Debt otherwise permitted hereunder, provided that the
aggregate principal amount of all such Debt which is secured by a
Lien shall not exceed Five Million Dollars ($5,000,000); and
(g) any Lien encumbering property interests, rights or proceeds which
are subject of a transfer or encumbrance pursuant to a Permitted
Securitization.
8.6 Dividends. Declare or pay any dividends on or make any other
distribution with respect to (whether by reduction of Stockholders' Equity or
otherwise) any shares of its capital stock, except for stock dividends and
except for (a) cash dividends by any 100% Subsidiary to the Company or any other
100% Subsidiary which has executed a Guaranty hereunder, (b) dividends paid in
cash or in kind by any Subsidiary which is not a 100% Subsidiary or by any Joint
Venture, provided that such dividends are paid to each holder of share capital
therein (including Company or any of its other Subsidiaries) on a pro rata basis
(based on the relative amounts of share capital held by each such holder) and
provided further that such dividends are paid to the Company or its other
Subsidiaries on substantially the same (or better) terms as (and
82
contemporaneously with) any dividends paid to Persons other than the Company and
its Subsidiaries, (c) cash dividends by Vishay Europe which are reinvested in
Vishay Europe by its shareholders in compliance with Section 8.7 hereof and (d)
cash dividends by Vishay Electronic which are reinvested in Vishay Electronic by
Vishay Europe in compliance with Section 8.7, hereof.
8.7 Investments. Make or allow to remain outstanding any investment
(whether such investment shall be of the character of investment in shares of
stock, evidences of indebtedness or other securities or otherwise) in, or any
loans or advances to, any Person, firm, corporation or other entity or
association, other than:
(a) Company's and its Subsidiaries' equity ownership interests in the
Subsidiaries as of the Effective Date;
(b) Additional cash investment in Vishay Europe by its shareholders or
in Vishay Electronic by Vishay Europe, which is applied by Vishay
Europe or Vishay Electronic, as the case may be, concurrently with
such investment to reduce its Indebtedness under this Agreement, in
substantially the amount of such additional investment;
(c) The existing investments, loans and/or advances in or to
Subsidiaries set forth or referred to on Schedule 8.7 hereto, in
addition to any other matters set forth in this Section 8.7;
(d) Intercompany Loans, Advances, or Investments made on or after the
Effective Date hereunder to Company, or by Company or any Subsidiary
to Company or any 100% Subsidiary (excluding Vishay Israel),
provided that any Intercompany Loan included therein be evidenced by
and funded under an Intercompany Note encumbered pursuant to a
Pledge Agreement and further provided that both before and after
giving effect to any such loans, advances or investments, no Default
or Event of Default has occurred and is continuing under this
Agreement;
(e) Intercompany Loans, Advances or Investments made on or after the
Effective Date by Company or any Subsidiary to Vishay Israel or to
any Subsidiary which does not constitute a 100% Subsidiary other
than Siliconix (provided that any Intercompany Loan included therein
be evidenced by and funded under an Intercompany Note encumbered
pursuant to a Pledge Agreement), provided that at the time any such
loan, advance or investment is made (before and after giving effect
thereto) no Default or Event of Default has occurred and is
continuing and provided further that the aggregate amount of all
such loans, advances and investments shall not exceed, at any time
outstanding, 10% of Tangible Net Worth;
(f) Intercompany Loans to Siliconix, but only to the extent evidenced by
and funded under an Intercompany Note encumbered pursuant to a
Pledge Agreement, provided that both before and after giving effect
to any such loans, advances or
83
investments, no Default or Event of Default has occurred and is
continuing under this Agreement;
(g) loans, advances or investments made on or after the Effective Date
(without regard to any repayment of such loans, advances or
investments, other than the repayment of capital or principal) to
any Joint Venture or other Person, including without limitation
guaranties by the Company or any Subsidiary (valued on the basis of
the aggregate amount of indebtedness covered by a guaranty) of
third-party indebtedness of any such Joint Venture or other Person,
which loans, advances or investments are not otherwise permitted
under this Section 8.7, in an aggregate amount at any time
outstanding not to exceed seven and one-half percent (7.5%) of
Tangible Net Worth;
(h) the Remaining Siliconix Acquisition, subject to the terms and
conditions of this Agreement;
(i) investments, whether by acquisition of shares of Capital Stock,
indebtedness or other obligations or security of, any Person (other
than a Subsidiary or an Affiliate) which is a customer of the
Company or any Subsidiary, which investment was made in exchange for
amounts owed by such customer to the Company or any Subsidiary (and
incurred in the ordinary course of business) or as an advance on the
provision of goods and services in the ordinary course of business;
(j) Hedging Obligations and guaranties by the Company of Hedging
Obligations entered into by any Foreign Subsidiary;
(k) Permitted Investments; and
(l) Investments in any Subsidiary (including, without limitation, any
Special Purpose Subsidiary) from and after the date hereof
consisting of (x) dispositions of specific foreign accounts
receivable made pursuant to any Permitted Securitization and the
resultant Debt issued by a Special Purpose Subsidiary to another
Subsidiary as part of such Permitted Securitization, in each case to
the extent constituting Investments hereunder; and (y) the
repurchase or replacement from and after the date hereof of accounts
receivable pursuant to any representations or warranties or clean up
call provisions included in such Permitted Securitization in
accordance with the definition thereof.
In valuing any investments, loans and advances for the purpose of applying the
limitations set forth in this Section 8.7 (except as otherwise expressly
provided herein), such investments, loans and advances shall be taken at the
original cost thereof, without allowance for any subsequent write-offs or
appreciation or depreciation therein, but less any amount repaid or recovered on
account of capital or principal.
8.8 Accounts Receivable. Sell or assign any account, note or trade
acceptance receivable, except to Agent on behalf of the Lenders, and except the
sale or assignment of foreign accounts receivable pursuant to any Permitted
Securitization.
84
8.9 Transactions with Affiliates. Enter into any transaction with any of
its or their stockholders or officers or its or their affiliates, except in the
ordinary course of business and on terms not less favorable than would be usual
and customary in similar transactions between Persons dealing at arm's length
and except for (i) transactions otherwise permitted by this Agreement and (ii)
transactions between the Company and any 100% owned Subsidiary (other than
Vishay Israel or its Israeli Subsidiaries) or between any 100% owned Subsidiary
and any other 100% owned Subsidiary (other than Vishay Israel or its Israeli
Subsidiaries).
8.10 Operations of Vishay Israel. Permit the normal manufacturing or other
operations of Vishay Israel (or of Company or any of its other Subsidiaries
conducted in Israel) to be interrupted, stopped or delayed for any period of
fourteen (14) consecutive days, excluding regularly scheduled vacations and
holidays in the ordinary course of such operations.
8.11 Prohibition Against Certain Restrictions. (a) Enter into or otherwise
become subject to any agreement or arrangement (excluding this Agreement and
excluding any such agreement by a Special Purpose Subsidiary pursuant to a
Permitted Securitization, but only to the extent such agreement applied only to
such Special Purpose Subsidiary) with any lender or other third party (i) which
prohibits, restricts or otherwise limits the ability of Company to make loans,
advances or investments to its Subsidiaries or which prohibits, restricts or
otherwise limits the ability of any Subsidiary to make loans, advances or
investments in any other Subsidiary (ii) which prohibits, restricts or otherwise
limits the ability of any Subsidiary to declare or pay any dividends on or make
any other distribution with respect to any shares of its capital stock, or (iii)
which prohibits, restricts or otherwise limits the execution, delivery or
performance by Company or any Subsidiary of any guaranty, indemnity or similar
undertaking in favor of Agent or the Lenders.
(b) Except in connection with Liens permitted by Section 8.5, to the
extent of the property encumbered by such Liens, enter into any
agreement, document or instrument which would restrict or prevent
Company and its Subsidiaries from granting Agent on behalf of
Lenders liens upon, security interests in and pledges of their
respective assets which are senior in priority to all other Liens.
8.12 Amendment of the BCc Acquisition Documents. Amend, modify or
otherwise alter (or suffer to be amended, modified or altered) any of the
material terms and conditions of the BCc Acquisition Documents in any respect
which is materially adverse to the Company, as determined by Company in its
reasonable discretion, without the prior written approval of Agent and the
Required Lenders; provided that promptly following any amendment to any of such
documents, Company shall provide Agent with copies of such amendments, for
distribution to the Lenders.
8.13 Amendment of Subordinated Debt and Other Debt Documents and Permitted
Securitizations. Amend, modify or otherwise alter (or suffer to be amended,
modified or altered) any of the terms and conditions of those documents or
instruments evidencing or otherwise related to any Debt set forth on Schedule
8.13 or any other Subordinated Debt (including the New Convertible Subordinated
Debt) or any Permitted Securitization, except for those amendments,
modifications or other alterations which could not reasonably be determined to
have a material adverse effect on (a) the business, operations, property or
condition (financial or
85
otherwise) of the Company and its Subsidiaries, taken as a whole, (b) the
ability of the Company or any of its Subsidiaries to perform their respective
obligations under this Agreement or any other Loan Document to which any of them
is a party, or (c) the validity or enforceability of this Agreement or any of
the other Loan Documents or the rights or remedies of the Agent or the Lenders
hereunder or thereunder, or except as may be approved by Agent and the Required
Lenders.
8.14 Payment or Prepayment of Other Debts. Prepay, purchase, redeem or
defease the New Subordinated Convertible Debt, any Subordinated Debt or any
other Debt set forth on Schedule 8.13 (whether in connection with the conversion
of any such Debt or otherwise), except for (a) prepayment, purchase, redemption
or defeasance of the LYONs, including the redemption of the LYONs at the option
of the holders thereof pursuant to their terms on June 4, 2004 and June 4, 2006,
(b) the prepayment of all outstanding principal, premium and interest on those
certain notes issued under and pursuant to that certain Indenture dated as of
December 14, 1999 between The Bank of New York, as trustee and General
Semiconductor, Inc., as issuer (the "General Semiconductor Notes"), and (c) the
conversion of the BCC Replacement Financing into stock pursuant to the put
rights relating thereto; and except for regularly scheduled payments of
interest, make any payments, prepayments or purchase, redeem or otherwise
defease the BCc Replacement Financing in cash or cash equivalents, prior to the
Revolving Credit Maturity Date.
9. DEFAULTS
9.1 Events of Default. Any of the following events is an "Event of
Default":
(a) non-payment when due of the principal or interest of any Advance in
accordance with the terms thereof or of any reimbursement obligation
under Section 3.6 hereof, and in the case of interest payments,
continuance thereof for three (3) days;
(b) default in the payment of any money by Company or any of the
Permitted Borrowers under this Agreement (other than as set forth in
subsection (a), above) or the other Loan Documents, and continuance
thereof for three (3) days of the date the same is due and payable;
(c) default in the observance or performance of any of the other
conditions, covenants or agreements set forth in this Agreement or
any of the other Loan Documents by any party thereto (provided that,
with respect to the covenants set forth in Sections 7.8, 7.10, 7.12,
7.13 and 7.14 hereof, such event has continued for thirty (30)
consecutive days) or the occurrence of any other default or Event of
Default, as the case may be hereunder or thereunder;
(d) any representation or warranty made by Company or any of the
Permitted Borrowers herein or in any instrument submitted pursuant
hereto or by any other party to the Loan Documents proves untrue in
any material adverse respect when made; provided that, with respect
to any misrepresentation or breach of warranty arising subsequent to
the date hereof under Sections 6.7, 6.8, 6.13 through 6.15 and 6.18
of this Agreement solely by virtue of the nature of the
representations
86
and warranties hereunder as continuing, (i) as to Section 6.8,
hereof, any applicable cure period existing in respect of such
matters shall have expired and (ii) as to the remaining Sections of
this Agreement specified in this subparagraph (d), such
misrepresentation or breach of warranty hereunder shall have
continued for a period of thirty (30) consecutive days;
(e) any provision of any Guaranty, or any Collateral Document shall at
any time for any reason (other than in accordance with its terms or
the terms of this Agreement) cease to be valid and binding and
enforceable against the Company or the Significant Subsidiaries, as
applicable, or the validity, binding effect or enforceability
thereof shall be contested by any Person, or the Company or any of
the Significant Subsidiaries shall deny that it has any or further
liability or obligation under any Guaranty, or any Collateral
Document, as applicable, or any Guaranty, or any Collateral Document
shall be terminated, invalidated or set aside or in any way cease to
give or provide to the Lenders and the Agent the benefits purported
to be created thereby;
(f) default in the payment of any other obligation of Company, its
Significant Subsidiaries, any Guarantor or any Person obligated
under a Security Agreement or Pledge Agreement for borrowed money in
excess of Ten Million Dollars ($10,000,000) (or the equivalent
thereof in an Alternative Currency), individually or in the
aggregate; or default in the observance or performance of any
conditions, covenants or agreements related or given with respect to
any other obligations for borrowed money in an aggregate amount in
excess of Ten Million Dollars ($10,000,000) (or the equivalent
thereof in an Alternative Currency), which is sufficient to permit
the holder thereof to accelerate the maturity of such obligation;
(g) the rendering of any judgment or judgments for the payment of money
in excess of the sum of Ten Million Dollars ($10,000,000) (or the
Alternative Currency equivalent thereof) in the aggregate against
Company, any of its Significant Subsidiaries, any Guarantor, or any
Person obligated under a Security Agreement or Pledge Agreement, and
such judgments shall remain unpaid, unvacated, unbonded or unstayed
by appeal or otherwise for a period of thirty (30) consecutive days,
except as covered by adequate insurance with a reputable carrier and
an action is pending in which an active defense is being made with
respect thereto;
(h) any Person shall engage in any Prohibited Transaction involving any
Pension Plan, (ii) any Accumulated Funding Deficiency, whether or
not waived, shall exist with respect to any Pension Plan or any Lien
in favor of the PBGC or a Pension Plan shall arise on the assets of
the Company or any ERISA Affiliate, (iii) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or
to terminate, any Single Employer Plan, (iv) any Single Employer
Plan shall terminate for purposes of Title IV of ERISA or (v) the
Company or any ERISA Affiliate shall, or in the reasonable opinion
of the Required Lenders is likely to,
87
incur any liability in connection with a withdrawal from, or the
insolvency, bankruptcy or reorganization of, a Multiemployer Plan
and in each case in clauses (i) through (v) above, (x) a period of
sixty (60) days, or more, has elapsed from the occurrence of such
event or condition and (y) such event or condition, together with
all other such events or conditions, if any, could reasonably be
expected to subject the Company or any of its Subsidiaries to any
tax, penalty or other liabilities in the aggregate material in
relation to the business, operations, property or financial or other
condition of the Company and its Subsidiaries taken as a whole;
(i) (A) any one Person or group of Persons acting in concert shall
acquire or control, directly or indirectly, whether by ownership,
proxy, voting trust or otherwise, twenty percent (20%) or more of
the voting power of the issued and outstanding stock of Company,
other than (x) any Person or group of Persons beneficially owning,
directly or indirectly, as of the date hereof capital stock of the
Company with twenty percent (20%) or more of such voting power or
(y) any Permitted Transferee; or (B) individuals who constitute the
Continuing Directors cease for any reason to constitute at least a
majority of the Company's directors (for purposes of this Section
9.1(i)(B), "Continuing Director" means any director who is currently
a director and any director who is nominated or elected by a
majority of Continuing Directors who are then directors);
(j) If a creditors' committee shall have been appointed for the business
of Company, any of its Significant Subsidiaries, any Guarantor or
any Person obligated under a Security Agreement or Pledge Agreement;
or if Company, any Significant Subsidiary, any Guarantor or any
Person obligated under a Security Agreement or Pledge Agreement
shall have made a general assignment for the benefit of creditors or
shall have been adjudicated bankrupt, or shall have filed a
voluntary petition in bankruptcy or for reorganization or to effect
a plan or arrangement with creditors or shall fail to pay its debts
generally as such debts become due in the ordinary course of
business (except as contested in good faith and for which adequate
reserves are made in such party's financial statements); or shall
file an answer to a creditor's petition or other petition filed
against it, admitting the material allegations thereof for an
adjudication in bankruptcy or for reorganization; or shall have
applied for or permitted the appointment of a receiver or trustee or
custodian for any of its property or assets; or such receiver,
trustee or custodian shall have been appointed for any of its
property or assets (otherwise than upon application or consent of
Company, any Significant Subsidiary, any Guarantor or any Person
obligated under a Security Agreement or Pledge Agreement) and such
appointment has not been dismissed or stayed within thirty (30) days
from the date of appointment or if an order for relief or otherwise
approving any petition for reorganization of Company, any
Significant Subsidiary, any Guarantor or any Person obligated under
a Security Agreement or Pledge Agreement shall be entered; or if an
involuntary petition is filed against Company, any Significant
Subsidiary, any Guarantor or any Person obligated under a Security
Agreement or Pledge Agreement and shall not be dismissed or stayed
within thirty (30) days from the date of filing thereof; and
88
(k) if any "Fundamental Change" shall have occurred as defined in that
certain Indenture entered into by the Company in connection with the
New Convertible Subordinated Debt without giving effect to any
amendments thereto or modifications thereof subsequent to the
Effective Date.
9.2 Exercise of Remedies. If an Event of Default has occurred and is
continuing hereunder: (a) the Agent shall, if directed to do so by the Required
Lenders, declare any commitment of the Lenders to extend credit hereunder
immediately terminated; (b) the Agent shall, if directed to do so by the
Required Lenders, declare the entire unpaid Indebtedness immediately due and
payable, without presentment, notice or demand, all of which are hereby
expressly waived by Company and the Permitted Borrowers; (c) upon the occurrence
of any Event of Default specified in Section 9.1(j) above, and notwithstanding
the lack of any declaration by Agent under the preceding clause (a) or (b), the
Lenders' commitments to extend credit hereunder shall immediately and
automatically terminate and the entire unpaid Indebtedness shall become
automatically due and payable without presentment, notice or demand; (d) the
Agent shall, upon being directed to do so by the Required Lenders, demand
immediate delivery of cash collateral, and the Company and each Account Party
agree to deliver such cash collateral upon demand, in an amount equal to the
maximum amount that may be available to be drawn at any time prior to the stated
expiry of all outstanding Letters of Credit; and (e) the Agent shall, if
directed to do so by the Required Lenders or the Lenders, as applicable (subject
to the terms hereof), exercise any remedy permitted by this Agreement, the other
Loan Documents or law.
9.3 Rights Cumulative. No delay or failure of Agent and/or Lenders in
exercising any right, power or privilege hereunder shall affect such right,
power or privilege, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof, or the exercise of any other power, right
or privilege. The rights of Lenders under this Agreement are cumulative and not
exclusive of any right or remedies which Lenders would otherwise have.
9.4 Waiver by Company and Permitted Borrowers of Certain Laws; JURY
WAIVER. To the extent permitted by applicable law, Company and each of the
Permitted Borrowers hereby agree to waive, and do hereby absolutely and
irrevocably waive and relinquish the benefit and advantage of any valuation,
stay, appraisement, extension or redemption laws now existing or which may
hereafter exist, which, but for this provision, might be applicable to any sale
made under the judgment, order or decree of any court, on any claim for interest
on any principal of any Advance, AND FURTHER HEREBY IRREVOCABLY AGREE TO WAIVE
THE RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY AND ALL ACTIONS OR PROCEEDINGS IN
WHICH AGENT OR THE LENDERS (OR ANY OF THEM), ON THE ONE HAND, AND THE COMPANY OR
ANY OF THE PERMITTED BORROWERS, ON THE OTHER HAND, ARE PARTIES, WHETHER OR NOT
SUCH ACTIONS OR PROCEEDINGS ARISE OUT OF THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS, OR OTHERWISE. These waivers have been voluntarily given, with full
knowledge of the consequences thereof.
9.5 Waiver of Defaults. No Event of Default shall be waived by the Lenders
except in a writing signed by an officer of the Agent in accordance with Section
13.11 hereof. No single or partial exercise of any right, power or privilege
hereunder, nor any delay in the exercise
89
thereof, shall preclude any other or further exercise of the Lenders' rights by
Agent. No waiver of any Event of Default shall extend to any other or further
Event of Default. No forbearance on the part of the Agent in enforcing any of
the Lenders' rights shall constitute a waiver of any of their rights. Company
and the Permitted Borrowers expressly agree that this Section may not be waived
or modified by the Lenders or Agent by course of performance, estoppel or
otherwise.
10. PAYMENTS, RECOVERIES AND COLLECTIONS.
10.1 Payment Procedure.
(a) All payments by Company and/or by any of the Permitted Borrowers of
principal of, or interest on, Advances of the Revolving Credit or
the Swing Line or of Letter of Credit Obligations or Fees shall be
made without setoff or counterclaim on the date specified for
payment under this Agreement not later than 11:00 a.m. (Detroit
time) in Dollars in immediately available funds to Agent, for the
ratable account of the Lenders, at Agent's office located at One
Detroit Center, Detroit, Michigan 48226, in respect of Domestic
Advances or Fees payable in Dollars. Payments made in respect of any
Advance in any Alternative Currency or any Fees payable in any
Alternative Currency shall be made in such Alternative Currency in
immediately available funds for the account of Agent's Eurocurrency
Lending Office, at the Agent's Correspondent, for the ratable
account of the Lenders, not later than 11:00 a.m. (the time of
Agent's Correspondent). Upon receipt of each such payment, the Agent
shall make prompt payment to each Lender, or, in respect of
Eurocurrency-based Advances, such Lender's Eurocurrency Lending
Office, in like funds and currencies, of all amounts received by it
for the account of such Lender.
(b) Unless the Agent shall have been notified by the Company prior to
the date on which any payment to be made by the Company or any of
the Permitted Borrowers is due that the Company or such Permitted
Borrower does not intend to remit such payment, the Agent may, in
its discretion, assume that the Company or such Permitted Borrower
has remitted such payment when so due and the Agent may, in reliance
upon such assumption, make available to each Lender on such payment
date an amount equal to such Lender's share of such assumed payment.
If the Company or any of the Permitted Borrowers has not in fact
remitted such payment to the Agent, each Lender shall forthwith on
demand repay to the Agent in the applicable currency the amount of
such assumed payment made available to such Lender, together with
the interest thereon, in respect of each day from and including the
date such amount was made available by the Agent to such Lender to
the date such amount is repaid to the Agent at a rate per annum
equal to (i) for Prime-based Advances, the Federal Funds Effective
Rate, as the same may vary from time to time, and (ii) with respect
to Eurocurrency-based Advances, Agent's aggregate marginal cost
(including the cost of maintaining any required reserves or deposit
insurance and of any fees, penalties, overdraft charges or other
costs or expenses incurred by Agent) of carrying such amount.
90
(c) Whenever any payment to be made hereunder (other than payments in
respect of any Eurocurrency-based Advance or a Quoted Rate Advance)
shall otherwise be due on a day which is not a Business Day, such
payment shall be made on the next succeeding Business Day and such
extension of time shall be included in computing interest, if any,
in connection with such payment. Whenever any payment of principal
of, or interest on, a Eurocurrency-based Advance or a Quoted Rate
Advance shall be due on a day which is not a Business Day the date
of payment thereof shall be extended to the next succeeding Business
Day unless as a result thereof it would fall in the next calendar
month, in which case it shall be shortened to the next preceding
Business Day and, in the case of a payment of principal, interest
thereon shall be payable for such extended or shortened time, if
any.
(d) All payments to be made by the Company or the Permitted Borrowers
under this Agreement (including without limitation payments under
the Swing Line) shall be made without set-off or counterclaim, as
aforesaid, and without deduction for or on account of any present or
future withholding or other taxes of any nature imposed by any
governmental authority or of any political subdivision thereof or
any federation or organization of which such governmental authority
may at the time of payment be a member, unless Company or any of the
Permitted Borrowers, as the case may be, is compelled by law to make
payment subject to such tax. In such event, Company and such
Permitted Borrower shall:
(i) pay to the Agent for Agent's own account and/or, as the case
may be, for the account of the Lenders (and, in the case of
any Swing Line Advances, pay to the Swing Line Bank which
funded such Advances) such additional amounts as may be
necessary to ensure that the Agent and/or such Lender or
Lenders receive a net amount in the applicable Permitted
Currency equal to the full amount which would have been
receivable had payment not been made subject to such tax; and
(ii) remit such tax to the relevant taxing authorities according to
applicable law, and send to the Agent such certificates or
certified copy receipts as the Agent or any Lender shall
reasonably require as proof of the payment by the Company or
such Permitted Borrower of any such taxes payable by the
Company or such Permitted Borrower.
As used herein, the terms "tax", "taxes" and "taxation" include all
taxes, levies, imposts, duties, charges, fees, deductions and
withholdings and any restrictions or conditions resulting in a
charge together with interest (and any taxes payable upon the
amounts paid or payable pursuant to this Section 10.1) thereon and
fines and penalties with respect thereto which may be imposed by
reason of any violation or default with respect to the law regarding
such tax, assessed as a result of or in connection with the
transactions in any Alternative Currency hereunder, or the payment
and/or receipt of funds in any Alternative Currency hereunder, or
the payment or delivery of funds into or out of any jurisdiction
other than the United
91
States (whether assessed against Company, the Permitted Borrower,
Agent or any of the Lenders).
10.2 Application of Proceeds. Subject to the Collateral Documents, but
notwithstanding anything to the contrary in this Agreement or other Loan
Document, after an Event of Default, the proceeds of any Collateral, together
with any offsets, voluntary payments by the Company or the Permitted Borrowers
or others and any other sums received or collected in respect of the
Indebtedness, shall be applied, first, to payment of principal and interest of
outstanding Advances, any reimbursement obligations under Section 3.6 hereof and
any net obligations with respect to Hedging Obligations entered into between the
Company or its Subsidiaries and a Lender or an affiliate of a Lender, on a pro
rata basis, next, to any other Indebtedness on a pro rata basis, and then, if
there is any excess, to the Company or the Permitted Borrowers, as the case may
be. The application of such proceeds and other sums to the outstanding
Indebtedness hereunder shall be based on each Lender's Percentage of the
aggregate Indebtedness.
10.3 Pro-rata Recovery. If any Lender shall obtain any payment or other
recovery (whether voluntary, involuntary, by application of offset or otherwise)
on account of principal of, or interest on, any of the outstanding Advances (or
on account of its participation in any Letter of Credit) in excess of its pro
rata share of payments then or thereafter obtained by all Lenders upon principal
of and interest on all outstanding Advances (or such participation), such Lender
shall purchase from the other Lenders such participations in the outstanding
Advances (or subparticipations in the Letters of Credit) held by them as shall
be necessary to cause such purchasing Lender to share the excess payment or
other recovery ratably in accordance with the Percentages of the Revolving
Credit with each of them; provided, however, that if all or any portion of the
excess payment or other recovery is thereafter recovered from such purchasing
holder, the purchase shall be rescinded and the purchase price restored to the
extent of such recovery, but without interest.
10.4 Set Off. Upon the occurrence and during the continuance of any Event
of Default, each Lender may at any time and from time to time, without notice to
the Company but subject to the provisions of Section 10.3 hereof, (any
requirement for such notice being expressly waived by the Company) set off and
apply against any and all of the obligations of the Company or any Permitted
Borrower now or hereafter existing under this Agreement, whether owing to such
Lender or any other Lender or the Agent, any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of the Company or such Permitted Borrower and any property of the
Company or such Permitted Borrower from time to time in possession of such
Lender, irrespective of whether or not such deposits held or indebtedness owing
by such Lender may be contingent and unmatured and regardless of whether any
Collateral then held by Agent or any Lender is adequate to cover the
Indebtedness, provided, however, that a Lender may not set off and apply against
any obligations of the Company or any Domestic Permitted Borrower any deposits
or property of, or other indebtedness owing to, or for the credit or account of
any Foreign Permitted Borrower. Promptly following any such setoff, such Lender
shall give written notice to Agent and to Company and the applicable Permitted
Borrower of the occurrence thereof. Each of the Company and each Permitted
Borrower hereby grants to the Lenders and the Agent a lien on and security
interest in all such deposits, indebtedness and property as collateral
92
security for the payment and performance of all of the obligations of the
Company and the Permitted Borrowers under this Agreement. The rights of each
Lender under this Section 10.4 are in addition to the other rights and remedies
(including, without limitation, other rights of setoff) which such Lender may
have.
11. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS.
11.1 Reimbursement of Prepayment Costs. If Company or any Permitted
Borrower makes any payment of principal with respect to any Eurocurrency-based
Advance or Quoted Rate Advance on any day other than the last day of the
Interest Period applicable thereto (whether voluntarily, by acceleration, or
otherwise), or if Company or any Permitted Borrower converts or refunds (or
attempts to convert or refund) any such Advance on any day other than the last
day of the Interest Period applicable thereto; or if Company or any Permitted
Borrower fails to borrow, refund or convert into any Eurocurrency-based Advance
or Quoted Rate Advance after notice has been given by Company or such Permitted
Borrower to Agent in accordance with the terms hereof requesting such Advance,
or if Company or any Permitted Borrower fails to make any payment of principal
or interest in respect of a Eurocurrency-based Advance or Quoted Rate Advance
when due, Company and the applicable Permitted Borrower shall reimburse Agent
for itself and/or on behalf of any Lender, as the case may be, on demand for any
resulting loss, cost or expense incurred (excluding the loss of any Applicable
Margin) by Agent and Lenders, as the case may be as a result thereof, including,
without limitation, any such loss, cost or expense incurred in obtaining,
liquidating, employing or redeploying deposits from third parties, whether or
not Agent and Lenders, as the case may be, shall have funded or committed to
fund such Advance. Such amount payable by Company to Agent for itself and/or on
behalf of any Lender, as the case may be, may include, without limitation, an
amount equal to the excess, if any, of (a) the amount of interest which would
have accrued on the amount so prepaid, or not so borrowed, refunded or
converted, for the period from the date of such prepayment or of such failure to
borrow, refund or convert, through the last day of the relevant Interest Period,
at the applicable rate of interest for said Advance(s) provided under this
Agreement, over (b) the amount of interest (as reasonably determined by Agent
and Lenders, as the case may be) which would have accrued to Agent and Lenders,
as the case may be, on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank eurocurrency market.
Calculation of any amounts payable to any Lender under this paragraph shall be
made as though such Lender shall have actually funded or committed to fund the
relevant Advance through the purchase of an underlying deposit in an amount
equal to the amount of such Advance and having a maturity comparable to the
relevant Interest Period; provided, however, that any Lender may fund any
Eurocurrency-based Advance or Quoted Rate Advance, as the case may be, in any
manner it deems fit and the foregoing assumptions shall be utilized only for the
purpose of the calculation of amounts payable under this paragraph. Upon the
written request of Company, Agent and Lenders shall deliver to Company a
certificate setting forth the basis for determining such losses, costs and
expenses, which certificate shall be conclusively presumed correct, absent
manifest error.
11.2 Eurocurrency Lending Office. For any Advance to which the
Eurocurrency-based Rate is applicable, if Agent or a Lender, as applicable,
shall designate a Eurocurrency Lending Office which maintains books separate
from those of the rest of Agent or
93
such Lender, Agent or such Lender, as the case may be, shall have the option of
maintaining and carrying the relevant Advance on the books of such Eurocurrency
Lending Office.
11.3 Availability of Alternative Currency. The Agent and the Lenders shall
not be required to make any Advance in an Alternative Currency if, at any time
prior to making such Advance, the Agent or the Required Lenders (after
consultation with Agent) shall determine, in its or their sole discretion, that
(i) deposits in the applicable Alternative Currency in the amounts and
maturities required to fund such Advance will not be available to the Agent and
the Lenders; (ii) a fundamental change has occurred in the foreign exchange or
interbank markets with respect to the applicable Alternative Currency
(including, without limitation, changes in national or international financial,
political or economic conditions or currency exchange rates or exchange
controls); or (iii) it has become otherwise materially impractical for the Agent
or the Lenders, as applicable, to make such Advance in the applicable
Alternative Currency. The Agent or the applicable Lender, as the case may be,
shall promptly notify the Company and Lenders of any such determination.
11.4 Refunding Advances in Same Currency. If pursuant to any provisions of
this Agreement, the Company or any of the Permitted Borrowers repays one or more
Advances and on the same day borrows an amount in the same currency, the Agent
(or the Swing Line Bank, in the case of a Swing Line Advance) shall apply the
proceeds of such new borrowing to repay the principal of the Advance or Advances
being repaid and only an amount equal to the difference (if any) between the
amount being borrowed and the amount being repaid shall be remitted by the Agent
to the Company or such Permitted Borrower, or by the Company or such Permitted
Borrower to the Agent, as the case may be.
11.5 Circumstances Affecting Eurocurrency-based Rate Availability. If with
respect to any Interest Period, Agent or the Required Lenders (after
consultation with Agent) shall determine that, by reason of circumstances
affecting the foreign exchange and interbank markets generally, deposits in
eurodollars or in any applicable Alternative Currency, as the case may be, in
the applicable amounts are not being offered to the Agent or such Lenders for
such Interest Period, then Agent shall forthwith give notice thereof to the
Company and the Permitted Borrowers. Thereafter, until Agent notifies Company
and the Permitted Borrowers that such circumstances no longer exist, (i) the
obligation of Lenders to make Eurocurrency-based Advances (other than in any
applicable Alternative Currency with respect to which deposits are available, as
required hereunder), and the right of Company and the Permitted Borrowers to
convert an Advance to or refund an Advance as a Eurocurrency-based Advance, as
the case may be (other than in any applicable Alternative Currency with respect
to which deposits are available, as required hereunder), shall be suspended, and
(ii) the Company and the Permitted Borrowers shall repay in full (or cause to be
repaid in full) the then outstanding principal amount of each such
Eurocurrency-based Advance covered hereby in the applicable Permitted Currency,
together with accrued interest thereon, any amounts payable under Sections 11.1
and 11.8 hereof, and all other amounts payable hereunder on the last day of the
then current Interest Period applicable to such Advance. Upon the date for
repayment as aforesaid and unless Company notifies Agent to the contrary within
two (2) Business Days after receiving a notice from Agent pursuant to this
Section, such outstanding principal amount shall be converted to a Prime-based
Advance as of the last day of such Interest Period.
94
11.6 Laws Affecting Eurocurrency-based Advance Availability. If, after the
date of this Agreement, the introduction of, or any change in, any applicable
law, rule or regulation or in the interpretation or administration thereof by
any governmental authority charged with the interpretation or administration
thereof, or compliance by any of the Lenders (or any of their respective
Eurocurrency Lending Offices) with any request or directive (whether or not
having the force of law) of any such authority, shall make it unlawful or
impossible for any of the Lenders (or any of their respective Eurocurrency
Lending Offices) to honor its obligations hereunder to make or maintain any
Advance with interest at the Eurocurrency-based Rate, or in an Alternative
Currency, such Lender shall forthwith give notice thereof to Company and to
Agent. Thereafter, (a) the obligations of Lenders to make Eurocurrency-based
Advances or Advances in any such Alternative Currency and the right of Company
or any Permitted Borrower to convert an Advance into or refund an Advance as a
Eurocurrency-based Advance or as an Advance in any such Alternative Currency
shall be suspended and thereafter Company and the Permitted Borrowers may select
as Applicable Interest Rates or as Alternative Currencies only those which
remain available and which are permitted to be selected hereunder, and (b) if
any of the Lenders may not lawfully continue to maintain an Advance to the end
of the then current Interest Period applicable thereto as a Eurocurrency-based
Advance or in such Alternative Currency, the applicable Advance shall
immediately be converted to a Prime-based Advance (in the Dollar Amount thereof)
and the Prime-based Rate shall be applicable thereto for the remainder of such
Interest Period. For purposes of this Section, a change in law, rule,
regulation, interpretation or administration shall include, without limitation,
any change made or which becomes effective on the basis of a law, rule,
regulation, interpretation or administration presently in force, the effective
date of which change is delayed by the terms of such law, rule, regulation,
interpretation or administration.
11.7 Increased Cost of Eurocurrency-based Advances. If the adoption after
the date of this Agreement of, or any change after the date of this Agreement
in, any applicable law, rule or regulation of or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by Agent or any of the Lenders (or any of their respective Eurocurrency Lending
Offices) with any request or directive (whether or not having the force of law)
made by any such authority, central bank or comparable agency after the date
hereof:
(a) shall subject any of the Lenders (or any of their respective
Eurocurrency Lending Offices) to any tax, duty or other charge with
respect to any Advance or shall change the basis of taxation of
payments to any of the Lenders (or any of their respective
Eurocurrency Lending Offices) of the principal of or interest on any
Advance or any other amounts due under this Agreement in respect
thereof (except for changes in the rate of tax on the overall net
income of any of the Lenders or any of their respective Eurocurrency
Lending Offices imposed by the jurisdiction in which such Lender's
principal executive office or Eurocurrency Lending Office is
located); or
(b) shall impose, modify or deem applicable any reserve (including,
without limitation, any imposed by the Board of Governors of the
Federal Reserve System), special deposit or similar requirement
against assets of, deposits with or for the account of, or credit
extended by, any of the Lenders (or any of their
95
respective Eurocurrency Lending Offices) or shall impose on any of
the Lenders (or any of their respective Eurocurrency Lending
Offices) or the foreign exchange and interbank markets any other
condition affecting any Advance;
and the result of any of the foregoing is to increase the costs to any of the
Lenders of maintaining any part of the Indebtedness hereunder as a
Eurocurrency-based Advance or as an Advance in any Alternative Currency or to
reduce the amount of any sum received or receivable by any of the Lenders under
this Agreement in respect of a Eurocurrency-based Advance or any Advance in an
Alternative Currency, whether with respect to Advances to Company or to any of
the Permitted Borrowers, then such Lender shall promptly notify Agent (or, in
the case of a Swing Line Advance, shall notify Company and the applicable
Permitted Borrower directly, with a copy of such notice to Agent), and Agent (or
such Lender, as aforesaid) shall promptly notify Company and Permitted Borrowers
of such fact and demand compensation therefor and, within fifteen (15) days
after such notice, Company agrees to pay to such Lender such additional amount
or amounts as will compensate such Lender or Lenders for such increased cost or
reduction. Agent will promptly notify Company and the Permitted Borrowers of any
event of which it has knowledge which will entitle Lenders to compensation
pursuant to this Section, or which will cause Company or Permitted Borrowers to
incur additional liability under Sections 11.1 and 11.8 hereof, provided that
Agent shall incur no liability whatsoever to the Lenders, Company or Permitted
Borrowers in the event it fails to do so. A certificate of Agent (or such
Lender, if applicable) setting forth the basis for determining such additional
amount or amounts necessary to compensate such Lender or Lenders shall be
conclusively presumed to be correct save for manifest error. For purposes of
this Section, a change in law, rule, regulation, interpretation, administration,
request or directive shall include, without limitation, any change made or which
becomes effective on the basis of a law, rule, regulation, interpretation,
administration, request or directive presently in force, the effective date of
which change is delayed by the terms of such law, rule, regulation,
interpretation, administration, request or directive.
11.8 Indemnity. The Company will indemnify Agent and each of the Lenders
against any loss or expense (but excluding loss of any Applicable Margin) which
may arise or be attributable to the Agent's and each Lender's obtaining,
liquidating or employing deposits or other funds acquired to effect, fund or
maintain the Advances (a) as a consequence of any failure by the Company or any
of the Permitted Borrowers to make any payment when due of any amount due
hereunder in connection with a Eurocurrency-based Advance, (b) due to any
failure of the Company or any Permitted Borrower to borrow, refund or convert on
a date specified therefor in a Request for Advance or (c) due to any payment,
prepayment or conversion of any Eurocurrency-based Advance on a date other than
the last day of the Interest Period for such Advance. Such loss or expense shall
be calculated based upon the present value, as applicable, of payments due from
the Company or such Permitted Borrower with respect to a deposit obtained by the
Agent or any of the Lenders in order to fund such Advance to the Company or to
such Permitted Borrower. The Agent's and each Lender's, as applicable,
calculations of any such loss or expense shall be furnished to the Company and
shall be conclusive, absent manifest error.
11.9 Judgment Currency. The obligation of the Company and Permitted
Borrowers to make payments of the principal of and interest on the outstanding
Advances and any other amounts payable hereunder in the currency specified for
such payment herein shall not be
96
discharged or satisfied by any tender, or any recovery pursuant to any judgment,
which is expressed in or converted into any other currency, except to the extent
that such tender or recovery shall result in the actual receipt by each of the
Lenders of the full amount of the particular Permitted Currency expressed to be
payable herein. The Agent (or the Swing Line Bank, as applicable) shall, using
all amounts obtained or received from the Company and from Permitted Borrowers
pursuant to any such tender or recovery in payment of principal of and interest
on the outstanding Advances, promptly purchase the applicable Permitted Currency
at the most favorable spot exchange rate determined by the Agent to be available
to it. The obligation of the Company and the Permitted Borrowers to make
payments in the applicable Permitted Currency shall be enforceable as an
alternative or additional cause of action solely for the purpose of recovering
in the applicable Permitted Currency the amount, if any, by which such actual
receipt shall fall short of the full amount of the Permitted Currency expressed
to be payable herein.
11.10 Capital Adequacy and Other Increased Costs. In the event that after
the Effective Date the adoption of or any change in any applicable law, treaty,
rule or regulation (whether domestic or foreign) now or hereafter in effect and
whether or not presently applicable to any Lender or Agent, or any
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof, or compliance by any Lender
or Agent with any guideline, request or directive of any such authority (whether
or not having the force of law), including any risk based capital guidelines,
affects or would affect the amount of capital required or expected to be
maintained by such Lender or Agent (or any corporation controlling such Lender
or Agent) and such Lender or Agent, as the case may be, determines that the
amount of such capital is increased by or based upon the existence of such
Lender's or Agent's obligations or Advances hereunder and such increase has the
effect of reducing the rate of return on such Lender's or Agent's (or such
controlling corporation's) capital as a consequence of such obligations or
Advances hereunder to a level below that which such Lender or Agent (or such
controlling corporation) could have achieved but for such circumstances (taking
into consideration its policies with respect to capital adequacy) by an amount
deemed by such Lender or Agent to be material (collectively, "Increased Costs"),
then Agent or such Lender shall notify the Company, and thereafter the Company
shall pay to such Lender or Agent, as the case may be, from time to time, upon
request by such Lender or Agent, additional amounts sufficient to compensate
such Lender or Agent (or such controlling corporation) for any increase in the
amount of capital and reduced rate of return which such Lender or Agent
reasonably determines to be allocable to the existence of such Lender's or
Agent's obligations or Advances hereunder; provided, however that the Company
shall not be obligated to reimburse any Lender for any Increased Costs pursuant
to this Section 11.10 unless such Lender notifies Company and the Agent within
180 days after such affected Lender has obtained actual knowledge of such
Increased Costs (but in any event within 365 days after such affected Lender is
required to comply with the applicable change in law). A statement as to the
amount of such compensation, prepared in good faith and in reasonable detail by
such Lender or Agent, as the case may be, shall be submitted by such Lender or
by Agent to the Company, reasonably promptly after becoming aware of any event
described in this Section 11.10 and shall be conclusive, absent manifest error
in computation.
11.11 Substitution of Lenders. If (a) the obligation of any Lender to make
Eurocurrency-based Advances has been suspended pursuant to Section 11.5 or 11.6
or (b) any
97
Lender has demanded compensation under Section 11.1 or 11.7, (in each case, an
"Affected Lender"), then Company shall have the right (subject to Section 13.8
hereof), with the assistance of the Agent, to seek a substitute lender or
lenders (which may be one or more of the Lenders (the "Purchasing Lender" or
"Purchasing Lenders") to purchase the Advances of the Revolving Credit and
assume the commitments (including without limitation its participations in Swing
Line Advances and Letters of Credit) under this Agreement of such Affected
Lender. The Affected Lender shall be obligated to sell its Advances of the
Revolving Credit and assign its commitments to such Purchasing Lender or
Purchasing Lenders within fifteen days after receiving notice from Company
requiring it to do so, at an aggregate price equal to the outstanding principal
amount thereof, plus unpaid interest accrued thereon up to but excluding the
date of the sale. In connection with any such sale, and as a condition thereof,
Company shall pay to the Affected Lender all fees accrued for its account
hereunder to but excluding the date of such sale, plus, if demanded by the
Affected Lender within ten Business Days after such sale, (i) the amount of any
compensation which would be due to the Affected Lender under Section 11.1 if
Company (or the applicable Permitted Borrower) has prepaid the outstanding
Eurocurrency-based Advances of the Affected Lender on the date of such sale and
(ii) any additional compensation accrued for its account under Sections 3.4,
11.7 and 11.10 to but excluding said date. Upon such sale, the Purchasing Lender
or Purchasing Lenders shall assume the Affected Lender's commitment, and the
Affected Lender shall be released from its obligations hereunder to a
corresponding extent. If any Purchasing Lender is not already one of the
Lenders, the Affected Lender, as assignor, such Purchasing Lender, as assignee,
Company and the Agent, with the required consent of the Swing Line Bank shall
enter into an Assignment Agreement pursuant to Section 13.8 hereof, whereupon
such Purchasing Lender shall be a Lender party to this Agreement, shall be
deemed to be an assignee hereunder and shall have all the rights and obligations
of a Lender with a Percentage equal to its ratable share of the then applicable
Revolving Credit Aggregate Commitment. In connection with any assignment
pursuant to this Section 11.11, Company or the Purchasing Lender shall pay to
the Agent the administrative fee for processing such assignment referred to in
Section 13.8.
12. AGENTS
12.1 Appointment of Agent. Each Lender appoints and authorizes the Agent
to act on behalf of such Lender under the Loan Documents and appoints and
authorizes the Agent to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Agent, as the case may be, by the
terms hereof and thereof, together with such powers as may be reasonably
incidental thereto. Each Lender agrees (which agreement shall survive any
termination of this Agreement) to reimburse Agent for all reasonable
out-of-pocket expenses (including in-house and outside attorneys' fees) incurred
by Agent hereunder or in connection herewith or with an Event of Default or in
enforcing the obligations of Company or any of the Permitted Borrowers under
this Agreement or the other Loan Documents or any other instrument executed
pursuant hereto (to the extent of Agent's powers hereunder or thereunder, as
aforesaid), and for which Agent is not reimbursed by Company or such Permitted
Borrower, pro rata according to such Lender's Percentage, but excluding any such
expenses resulting from the gross negligence or willful
98
misconduct of such Agent, as applicable. Agent shall not be required to take any
action under the Loan Documents, or to prosecute or defend any suit in respect
of the Loan Documents, unless indemnified to their respective satisfaction by
the Lenders against loss, costs, liability and expense (excluding liability
resulting from its gross negligence or willful misconduct). If any indemnity
furnished to Agent shall become impaired, it may call for additional indemnity
and cease to do the acts indemnified against until such additional indemnity is
given.
12.2 Deposit Account with Agent. Each of Company and the Permitted
Borrowers hereby authorizes Agent to charge its general deposit account, if any,
maintained with Agent for the amount of any principal, interest, or other
amounts or costs due under this Agreement when the same becomes due and payable
under the terms of this Agreement.
12.3 Exculpatory Provisions. The Agent agrees to exercise its rights and
powers, and to perform its duties, as an agent hereunder and under the other
Loan Documents in accordance with its usual customs and practices in bank-agency
transactions, but only upon and subject to the express terms and conditions of
this Section 12 (and no implied covenants or other obligations shall be read
into this Agreement against the Agent); neither the Agent nor any of its
directors, officers, employees or agents shall be liable to any Lender for any
action taken or omitted to be taken by it or them under this Agreement or any
document executed pursuant hereto, or in connection herewith or therewith,
except for its or their own willful misconduct or gross negligence, nor be
responsible for any recitals or warranties herein or therein, or for the
effectiveness, enforceability, validity or due execution of this Agreement or
any document executed pursuant hereto, or any security thereunder, or to make
any inquiry respecting the performance by Company, any of its Subsidiaries or
any of the Permitted Borrowers of its obligations hereunder or thereunder. Agent
shall not have, or be deemed to have, a fiduciary relationship with any Lender
by reason of this Agreement. Agent shall be entitled to rely upon advice of
counsel concerning legal matters and upon any notice, consent, certificate,
statement or writing which it believes to be genuine and to have been presented
by a proper person.
12.4 Successor Agent. The Agent may resign as such at any time upon at
least 30 days prior notice to Company and all Lenders. If Agent at any time
shall resign or if a vacancy shall occur in the office of the Agent for any
other reason, Required Lenders shall, by written instrument, appoint a successor
Agent (consisting of any other Lender or financial institution satisfactory to
such Required Lenders) which shall thereupon become Agent hereunder and shall be
entitled to receive from the prior agent such documents of transfer and
assignment as such successor agent may reasonably request. Such successor Agent
shall succeed to all of the rights and obligations of the retiring agent as if
originally named. The retiring agent shall duly assign, transfer and deliver to
such successor Agent all moneys at the time held by the retiring agent hereunder
after deducting therefrom its expenses for which it is entitled to be
reimbursed. Upon such succession of any such successor agent, the retiring agent
shall be discharged from its duties and obligations hereunder, except for its
gross negligence or willful misconduct arising prior to its retirement
hereunder, and the provisions of this Section 12 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 an agent hereunder.
12.5 Loans by Agent. The Agent shall have the same rights and powers with
respect to the credit extended by it as any Lender and may exercise the same as
if it were not an agent hereunder, and the term "Lender" and, when appropriate,
"holder" shall include the Agent in its individual capacity.
99
12.6 Credit Decisions. Each Lender acknowledges that it has, independently
of Agents and each other Lender and based on the financial statements of
Company, the Permitted Borrowers and the Subsidiaries and such other documents,
information and investigations as it has deemed appropriate, made its own credit
decision to extend credit hereunder from time to time. Each Lender also
acknowledges that it will, independently of Agents and each other Lender and
based on such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any document executed pursuant hereto.
12.7 Notices by Agent. Agent shall give prompt notice to each Lender of
its receipt of each notice or request required or permitted to be given to Agent
by Company or a Permitted Borrower pursuant to the terms of this Agreement and
shall promptly distribute to the Lenders any reports received from the Company
or any of its Subsidiaries or any of the Permitted Borrowers under the terms
hereof, or other material information or documents received by Agent, in its
capacity Agent, from the Company, its Subsidiaries or the Permitted Borrowers.
12.8 Agent's Fees. Until the Indebtedness has been repaid and discharged
in full and no commitment to fund any loan hereunder is outstanding, the Company
shall pay to the Agent, as applicable, an agency fee(s) set forth (or to be set
forth from time to time) in the Fee Letter on the terms set forth therein. The
Agent's Fees described in this Section 12.8 shall not be refundable under any
circumstances.
12.9 Nature of Agency. The appointment of Agent as Agent is for the
convenience of Lenders, Company and the Permitted Borrowers in making Advances
of the Revolving Credit or any other Indebtedness of Company or the Permitted
Borrowers hereunder, collecting fees, and principal and interest on the
Indebtedness, and otherwise administering this Agreement and the other Loan
Documents according to the express terms hereof and thereof. No Lender is
purchasing any Indebtedness from Agents (or either of them) and this Agreement
is not intended to be a purchase or participation agreement (except to the
extent of risk participations acquired pursuant to Section 3.6(c) hereof).
12.10 Authority of Agent to Enforce This Agreement. Each Lender, subject
to the terms and conditions of this Agreement (including, without limitation,
any required approval or direction of the Required Lenders or the Lenders, as
applicable, to be obtained by or given to the Agent hereunder), authorizes the
Agent with full power and authority as attorney-in-fact to institute and
maintain actions, suits or proceedings for the collection of the Indebtedness
and enforcement of this Agreement and the other Loan Documents and to file such
proofs of debt or other documents as may be necessary to have the claims of the
Lenders allowed in any proceeding relative to the Company, any of its
Subsidiaries, any of the Permitted Borrowers or its creditors or affecting its
properties, and to take such other actions which Agent considers to be necessary
or desirable for the protection, collection and enforcement of the Indebtedness,
this Agreement or the other Loan Documents, but in each case only to the extent
of any required approval or direction of the Required Lenders or the Lenders, as
applicable, obtained by or given to the Agent hereunder.
100
12.11 Indemnification. The Lenders agree to indemnify each of the Agents
in their respective capacities as such, to the extent not reimbursed by the
Company or the Permitted Borrowers, pro rata according to their respective
Percentages, from and against any and all claims, liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, and reasonable
out-of-pocket expenses or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against the Agents in any way
relating to or arising out of this Agreement or any of the other Loan Documents
or any action taken or omitted to be taken or suffered in good faith by the
Agents, or either of them, as the case may be, hereunder, provided that no
Lender shall be liable to Agent or Syndication Agent, as the case may be, for
any portion of any of the foregoing items resulting from the gross negligence or
willful misconduct of such agent, or any of its officers, employees, directors
or agents. For purposes of this Section 12.11, "Agent" shall be deemed to
include Comerica Bank in its capacity as Swing Line Bank.
12.12 Knowledge of Default. It is expressly understood and agreed that
Agent (whether in the capacity of Swing Line Bank or otherwise) shall be
entitled to assume that no Default or Event of Default has occurred and is
continuing, unless the officers of Agent immediately responsible for matters
concerning this Agreement shall have actual (rather than constructive) knowledge
of such occurrence or shall have been notified in writing by Company or a Lender
that the Company or such Lender considers that a Default or an Event of Default
has occurred and is continuing, and specifying the nature thereof. Upon
obtaining actual knowledge of any Default or Event of Default as described
above, the Agent shall promptly, but in any event within three (3) Business Days
after obtaining actual knowledge thereof, notify each Lender of such Default or
Event of Default and the action, if any, the Agent proposes be taken with
respect thereto.
12.13 Agent's Authorization; Action by Lenders. Except as otherwise
expressly provided herein, whenever the Agent is authorized and empowered
hereunder on behalf of the Lenders to give any approval or consent, or to make
any request, or to take any other action, on behalf of the Lenders (including
without limitation the exercise of any right or remedy hereunder or under the
other Loan Documents), the Agent shall be required to give such approval or
consent, or to make such request or to take such other action only when so
requested in writing by the Required Lenders or the Lenders, as applicable
hereunder. Action that may be taken by Required Lenders or all of the Lenders,
as the case may be (as provided for hereunder), may be taken (i) pursuant to a
vote at a meeting (which may be held by telephone conference call) as to which
all of the Lenders have been given reasonable advance notice (subject to the
requirement that amendments, waivers or consents under Section 13.11 hereof be
made in writing by the Required Lenders or all the Lenders, as applicable), or
(ii) pursuant to the written consent of the requisite Percentages of the Lenders
as required hereunder, provided that all of the Lenders are given reasonable
advance notice of the requests for such consent.
12.14 Enforcement Actions by the Agent. Except as otherwise expressly
provided under this Agreement or in any of the other Loan Documents and subject
to the terms hereof, Agent will take such action, assert such rights and pursue
such remedies under this Agreement and the other Loan Documents as the Required
Lenders or all of the Lenders, as the case may be (as provided for hereunder),
shall direct. Except as otherwise expressly provided in any of the Loan
Documents, Agent will not (and will not be obligated to) take any action, assert
any rights or pursue any remedies under this Agreement or any of the other Loan
Documents in violation or
101
contravention of any express direction or instruction of the Required Lenders or
all of the Lenders, as the case may be (as provided for hereunder). Agent may
refuse (and will not be obligated) to take any action, assert any rights or
pursue any remedies under this Agreement or any of the other Loan Documents in
the absence of the express written direction and instruction of the Required
Lenders or all of the Lenders, as the case may be (as provided for hereunder).
In the event Agent fails, within a commercially reasonable time, to take such
action, assert such rights, or pursue such remedies as the Required Lenders or
all of the Lenders, as the case may be (as provided for hereunder), shall direct
in conformity with this Agreement, the Required Lenders or all of the Lenders,
as the case may be (as provided for hereunder), shall have the right to take
such action, to assert such rights, or pursue such remedies on behalf of all of
the Lenders unless the terms hereof otherwise require the consent of all the
Lenders to the taking of such actions (in which event all of the Lenders must
join in such action). Except as expressly provided above or elsewhere in this
Agreement or the other Loan Documents, no Lender (other than the Agent, acting
in its capacity as Agent) shall be entitled to take any enforcement action of
any kind under any of the Loan Documents.
12.15 Collateral Matters.
(a) The Agent is authorized on behalf of all the Lenders, without the
necessity of any notice to or further consent from the Lenders, from
time to time to take any action with respect to any Collateral or
the Collateral Documents which may be necessary to perfect and
maintain a perfected security interest in and Liens upon the
Collateral granted pursuant to the Loan Documents.
(b) The Lenders agree to release, and hereby irrevocably authorize the
Agent to release, (x) any Lien granted to or held by the Agent upon
any Collateral (i) upon termination of the Revolving Credit
Aggregate Commitment and payment in full of all Indebtedness payable
under this Agreement and under any other Loan Document; or (ii)
constituting property sold or to be sold or disposed of as part of
or in connection with any express disposition permitted hereunder;
(y) the Guaranty of any Subsidiary, but only in connection with the
sale of all of the share capital of such Subsidiary and only to the
extent that such sale is expressly permitted hereunder, and (z) any
Lien granted to or held by the Agent upon any Collateral or any
Guaranty issued hereunder, but only if and to the extent (i)
required to be released under Section 7.17(b) hereof, or (ii)
approved, authorized or ratified in writing by the Required Lenders,
or all the Lenders, as the case may be, as provided in Section
13.11. Upon request by the Agent at any time, the Lenders will
confirm in writing the Agent's authority to release particular types
or items of Collateral pursuant to this Section 12.15(b).
12.16 Syndication Agent and Documentation Agents. Each of the following
Lenders (or their affiliates) have been designated by the Company as a
"Documentation Agent" under this Agreement: Wachovia Bank, National Association,
Bank of America, N.A. and J.P. Morgan Chase Bank. Fleet Securities, Inc. has
been designated by the Company as "Syndication Agent" under this Agreement. Bank
Leumi has been designated a "Managing Agent" under this Agreement. Other than
their respective rights and remedies as Lenders hereunder, such Documentation
Agents, the Managing Agent and the Syndication Agent shall have no
102
administrative, collateral or other rights or responsibilities, provided,
however, that each such Documentation Agent and Syndication Agent shall be
entitled to the benefits afforded to the Agents under Sections 12.5, 12.6 and
12.11 hereof.
13. MISCELLANEOUS
13.1 Accounting Principles. Where the character or amount of any asset or
liability or item of income or expense is required to be determined or any
consolidation or other accounting computation is required to be made for the
purposes of this Agreement, it shall be done in accordance with GAAP.
13.2 Consent to Jurisdiction. Each of the Company and the Permitted
Borrowers hereby irrevocably submits to the non-exclusive jurisdiction of any
United States Federal or Michigan state court sitting in Detroit in any action
or proceeding arising out of or relating to this Agreement or any of the other
Loan Documents and each of the Company and the Permitted Borrowers hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in any such United States Federal or Michigan state
court. Each of the Permitted Borrowers irrevocably appoints the Company as its
agent for service of process. Each of the Company and the Permitted Borrowers
irrevocably consents to the service of any and all process in any such action or
proceeding brought in any court in or of the State of Michigan by the delivery
of copies of such process to the Company at its address specified on the
signature page hereto or by certified mail directed to such address. Nothing in
this Section shall affect the right of the Lenders and the Agent to serve
process in any other manner permitted by law or limit the right of the Lenders
or the Agent (or any of them) to bring any such action or proceeding against the
Company or the Permitted Borrowers or any of its or their property in the courts
of any other jurisdiction. Each of the Company and the Permitted Borrowers
hereby irrevocably waives any objection to the laying of venue of any such suit
or proceeding in the above described courts.
13.3 Law of Michigan. This Agreement has been delivered at Detroit,
Michigan, and shall be governed by and construed and enforced in accordance with
the laws of the State of Michigan. Whenever possible each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
13.4 Interest. In the event the obligation of the Company or any of the
Permitted Borrowers to pay interest on the principal balance of the outstanding
Advances is or becomes in excess of the maximum interest rate which the Company
or any Permitted Borrower is permitted by law to contract or agree to pay,
giving due consideration to the execution date of this Agreement, then, in that
event, the rate of interest applicable with respect to any Lender's Percentage
of the Revolving Credit, as applicable, shall be deemed to be immediately
reduced to such maximum rate and all previous payments in excess of the maximum
rate shall be deemed to have been payments in reduction of principal and not of
interest.
103
13.5 Closing Costs; Other Costs. Company shall pay or reimburse Agents for
their own accounts or on behalf of the Lenders for payment of, on demand (a) all
closing costs and expenses, including, by way of description and not limitation,
in-house and outside attorney fees and advances, appraisal and accounting fees,
title and lien search fees, and required travel costs, incurred by Agents (and
either of them) in connection with the commitment, consummation and closing of
the loans contemplated hereby, or in connection with any refinancing or
restructuring of the loans or advances provided under this Agreement or the
other Loan Documents, or any amendment thereof or waiver or consent with respect
thereto requested by Company; and (b) all stamp and other taxes and fees payable
or determined to be payable (by either of the Agents or any Lender) in
connection with the execution, delivery, filing or recording of this Agreement
and the Loan Documents and the consummation of the transactions contemplated
hereby, and any and all liabilities with respect to or resulting from any delay
in paying or omitting to pay such taxes or fees. Furthermore, all reasonable
costs and expenses, including without limitation attorney fees, and costs and
expenses to Environmental Auditors retained by Agent hereunder, incurred by
Agents (and either of them) in revising, preserving, protecting, exercising or
enforcing any of its or any of the Lenders' rights against Company or any of the
Permitted Borrowers, or otherwise incurred by Agents and by the Lenders (using a
single law firm retained by Agent, with the approval of the Required Lenders) in
connection with any Event of Default or the enforcement of the loans (whether
incurred through negotiations, legal proceedings or otherwise), including by way
of description and not limitation, such charges in any court or bankruptcy
proceedings or arising out of any claim or action by any person against Agents
(and either of them) or any Lender which would not have been asserted were it
not for the Agents' or such Lender's relationship with Company and the Permitted
Borrowers hereunder or otherwise, shall also be paid by Company and the
Permitted Borrowers. All of said amounts required to be paid by Company
hereunder and not paid forthwith upon demand, as aforesaid, shall bear interest,
from the date incurred to the date payment is received by Agents, as applicable,
at the Prime-based Rate, plus three percent (3%).
13.6 Notices. Except as otherwise expressly set forth in this Agreement,
all notices and other communications provided to any party hereto under this
Agreement or any other Loan Document shall be in writing and shall be given by
personal delivery, by mail, by reputable overnight courier, by telex or by
facsimile and addressed or delivered to it at its address set forth on the
Administrative Detail forms on file with the Agent or at such other address as
may be designated by such party in a notice to the other parties that complies
as to delivery with the terms of this Section 13.6. Any notice, if personally
delivered or if mailed and properly addressed with postage prepaid and sent by
registered or certified mail, shall be deemed given when received or when
delivery is refused; any notice, if given to a reputable overnight courier and
properly addressed, shall be deemed given two (2) Business Days after the date
on which it was sent, unless it is actually received sooner by the named
addressee; and any notice, if transmitted by telex or facsimile, shall be deemed
given when received (answer back confirmed in the case of telexes and receipt
confirmed in the case of telecopies). Agents may, but, except as specifically
provided herein, shall not be required to, take any action on the basis of any
notice given to it by telephone, but the giver of any such notice shall promptly
confirm such notice in writing or by telex or facsimile, and such notice will
not be deemed to have been received until such confirmation is deemed received
in accordance with the provisions of this Section set forth above. If such
telephonic notice conflicts with any such confirmation, the terms of such
telephonic notice shall control.
104
13.7 Further Action. Company and the Permitted Borrowers, from time to
time, upon written request of Agents will make, execute, acknowledge and deliver
or cause to be made, executed, acknowledged and delivered, all such further and
additional instruments, and take all such further action, as may be required to
carry out the intent and purpose of this Agreement, and to provide for Advances
under this Agreement, according to the intent and purpose herein and therein
expressed.
13.8 Successors and Assigns; Assignments and Participations.
(a) This Agreement shall be binding upon and shall inure to the benefit
of Company and the Permitted Borrowers and the Lenders and their
respective successors and assigns.
(b) The foregoing shall not authorize any assignment by Company or any
of the Permitted Borrowers, of its rights or duties hereunder, and
no such assignment shall be made (or effective) without the prior
written approval of the Lenders.
(c) The Company, Permitted Borrowers and Agents acknowledge that each of
the Lenders may at any time and from time to time, subject to the
terms and conditions hereof (including Section 13.14 hereof), (i)
assign or grant participations in such Lender's rights and
obligations hereunder and under the other Loan Documents to any
commercial bank, savings and loan association, insurance company,
pension fund, mutual fund, commercial finance company or other
similar financial institution, the identity of which institution is
approved by Company and the Agent, such approval not to be
unreasonably withheld or delayed; provided, however, that (x) the
approval of Company shall not be required upon the occurrence and
during the continuance of a Default or Event of Default and (y) the
approval of Company and Agent shall not be required for any such
sale, transfer, assignment or participation to the Affiliate of an
assigning Lender, any other Lender or any Federal Reserve Bank and
(ii) grant to an SPFV the option to fund all or any part of any
Advance that the Granting Lender would otherwise be obligated to
fund pursuant to this Agreement; provided, however, that (A) nothing
herein shall constitute a commitment by any SPFV to fund any
Advance, but if an SPFV elects not to fund all or any part of an
Advance hereunder, the Granting Lender shall be obligated to fund
such Advance pursuant to the terms hereof; (B) the funding of any
Advance by an SPFV hereunder shall be credited against the
applicable commitment of the Granting Lender to fund such Advance to
the same extent as, and as if, such Advance were funded by such
Granting Lender and any payments in respect of an Advance (or
portion thereof) previously funded by any SPFV shall be paid, for
the account of such SPFV, to its Granting Lender, as agent for such
SPFV; (C) each SPFV shall have all the rights that a Lender making
such Advances or any portion thereof would have had under this
Agreement (provided that each SPFV shall have granted to its
Granting Lender an irrevocable power of attorney to deliver and
receive all communications and notices under this Agreement and the
other Loan Documents and to exercise on behalf of such SPFV all such
SPFV's voting rights under this Agreement) and no additional Note or
other instrument shall be required to
105
evidence the Advances or portion thereof funded by any SPFV, each
related Granting Lender being deemed to hold its Note as agent for
such SPFV to the extent of the Advances or portion thereof funded by
such SPFV; (D) Company and Agent agree that no SPFV shall be liable
for any indemnity or payment under this Agreement for which a
Granting Lender would otherwise be liable so long as, and to the
extent, the Granting Lender provides such indemnity or makes such
payment, as the case may be; and (E) an SPFV may, at any time and
without paying any processing fee therefor, assign or participate
all or a portion of its interest in any Advances to the Granting
Lender or to any financial institutions providing liquidity and/or
credit support to or for the account of SPFV to support the funding
or maintenance of Advances (provided that the rights of any such
assignee or participant shall be subject to and limited as set forth
in this clause (ii) of Section 13.8(c)). The Company and each of
Permitted Borrowers authorize each Lender to disclose to any
prospective assignee or participant, once approved by Company and
Agent and to any assignee under an assignment not required to be
approved by the Company pursuant to clauses (x) and (y) of the first
proviso of this Section 13.8(c) and to an SPFV (and on a
confidential basis to any Rating Agency, commercial paper dealer or
provider of any surety or guaranty to such SPFV), any and all
financial information in such Lender's possession concerning the
Company and such Permitted Borrower which has been delivered to such
Lender pursuant to this Agreement; provided that each such
prospective participant shall execute a confidentiality agreement
consistent with the terms of Section 13.13 hereof. Clause (ii), the
definition of "Granting Lender," and the immediately preceding
sentence of this Section 13.8(c) may not be amended without the
prior written consent of each Granting Lender, all or any part of
whose Advances are being funded by an SPFV at the time of any such
amendment; and each party hereto agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date
that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any
SPFV, it will not, on the basis of any claim or matter arising under
or in connection with or otherwise relating to this Agreement,
institute against, or join any other person in instituting against
such SPFV any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under the laws of the United States of
America or any state or political subdivision thereof.
(d) Each assignment by a Lender of any portion of its rights and/or
obligations hereunder and under the other Loan Documents, other than
assignments to such Lender's Affiliates or to a Federal Reserve Bank
under Section 13.8(c)(ii) hereof, shall be made pursuant to an
Assignment Agreement ("Assignment Agreement") substantially (as
determined by Agent), in the form attached hereto as Exhibit E (with
appropriate insertions acceptable to Agent) and shall be subject to
the terms and conditions hereof, and to the following restrictions:
(i) each partial assignment shall be made as an assignment of a
part of all of the assigning Lender's rights and obligations
hereunder;
106
(ii) each assignment shall be in a minimum amount of the lesser of
(x) Five Million Dollars ($5,000,000) and (y) the entire
remaining amount of assigning Lender's interest in the
Revolving Credit (and participations in any outstanding
Letters of Credit); provided however that, after giving effect
to such assignment, in no event shall the entire remaining
amount (if any) of assigning Lender's interest in the
Revolving Credit (and participations in any outstanding
Letters of Credit) be less than $5,000,000;
(iii) no assignment shall be effective unless Agent has received
from the assignee (or from the assigning Lender) an assignment
fee of $3,500 for each such assignment.
In connection with any assignment subject to this Section 13.8(d),
Company, each of the Permitted Borrowers and Agents shall be
entitled to continue to deal solely and directly with the assigning
Lender in connection with the interest so assigned until the Agent
shall have received a notice of assignment duly executed by the
assigning Lender and an Assignment Agreement (with respect thereto)
duly executed by the assigning Lender and each assignee; and (y) the
assigning Lender shall have delivered to the Agent the original of
each Note, if any, issued to such Lender, held by the assigning
Lender under this Agreement. From and after the date on which the
Agents shall notify Company and the Lender which has accepted an
assignment subject to this Section 13.8(d) that the foregoing
conditions shall have been satisfied and all consents (if any)
required shall have been given, the assignee thereunder shall be
deemed to be a party to this Agreement. To the extent that rights
and obligations hereunder shall have been assigned to such assignee
as provided in such notice of assignment (and Assignment Agreement),
such assignee shall have the rights and obligations of a Lender
under this Agreement and the other Loan Documents (including without
limitation the right to receive fees payable hereunder in respect of
the period following such assignment). In addition, the assigning
Lender, to the extent that rights and obligations hereunder shall
have been assigned by it as provided in such notice of assignment
(and Assignment Agreement), but not otherwise, shall relinquish its
rights and be released from its obligations under this Agreement and
the other Loan Documents. Schedule 1.1 to this Agreement shall be
deemed to be amended to reflect the applicable new Percentages of
the Lenders (including the assignee Lender), taking into account
such assignment.
(e) Each Lender agrees that any participation agreement permitted
hereunder shall comply with all applicable laws and shall be subject
to the following restrictions (which shall be set forth in the
applicable participation agreement):
(i) such Lender shall remain the holder of its interest in the
Indebtedness hereunder, notwithstanding any such
participation;
107
(ii) except as expressly set forth in this Section 13.8(e) with
respect to rights of setoff and the benefits of Section 11
hereof, a participant shall have no direct rights or remedies
hereunder;
(iii) such Lender shall retain the sole right and responsibility to
enforce the obligations of the Company and Permitted Borrowers
relating to this Agreement and the other Loan Documents,
including, without limitation, the right to proceed against
any Guarantors, or cause Agent to do so (subject to the terms
and conditions hereof), and the right to approve any
amendment, modification or waiver of any provision of this
Agreement without the consent of the participant, except in
the case of participations granted to an Affiliate of such
Lender and except for those matters covered by Section
13.11(a) through (e) and (h) hereof (provided that a
participant may exercise approval rights over such matters
only on an indirect basis, acting through such Lender, and
Company, Permitted Borrowers, Agent and the other Lenders may
continue to deal directly with such Lender in connection with
such Lender's rights and duties hereunder).
Company and each of the Permitted Borrowers each agrees that each
participant shall be deemed to have the right of setoff under
Section 10.4 hereof in respect of its participation interest in
amounts owing under this Agreement and the other Loan Documents to
the same extent as if the Indebtedness were owing directly to it as
a Lender under this Agreement, shall be subject to the pro rata
recovery provisions of Section 10.3 hereof and shall be entitled to
the benefits of Section 11 hereof. The amount, terms and conditions
of any participation shall be as set forth in the participation
agreement between the issuing Lender and the Person purchasing such
participation, and the Company, the Permitted Borrowers, the Agents
and the other Lenders shall not have any responsibility or
obligation with respect thereto, or to any Person to whom any such
participation may be issued. No such participation shall relieve any
issuing Lender of any of its obligations under this Agreement or any
of the other Loan Documents, and all actions hereunder shall be
conducted as if no such participation had been granted.
(f) The Agent shall maintain at its principal office a copy of each
Assignment Agreement delivered to it and a register (the "Register")
for the recordation of the names and addresses of the Lenders, the
Percentages of such Lenders and the principal amount of each type of
Advance owing to each such Lender from time to time. The entries in
the Register shall be conclusive evidence, absent manifest error,
and the Company, the Permitted Borrowers, the Agent, and the Lenders
may treat each Person whose name is recorded in the Register as the
owner of the Advances recorded therein for all purposes of this
Agreement. The Register shall be available for inspection by the
Company, the Permitted Borrowers or any Lender upon reasonable
notice to the Agent and a copy of such information shall be provided
to any such party on their prior written request. The Agent shall
give prompt written notice to the Company of the making of any entry
in the Register or any change in such entry.
108
(g) Nothing in this Agreement, or the other Loan Documents, expressed or
implied, is intended to or shall confer on any Person other than the
respective parties hereto and thereto and their successors and
assignees and participants permitted hereunder and thereunder any
benefit or any legal or equitable right, remedy or other claim under
this Agreement, or the other Loan Documents.
13.9 Indulgence. No delay or failure of Agents and the Lenders in
exercising any right, power or privilege hereunder shall affect such right,
power or privilege nor shall any single or partial exercise thereof preclude any
other or further exercise thereof, or the exercise of any other right, power or
privilege. The rights of Agents and the Lenders hereunder are cumulative and are
not exclusive of any rights or remedies which Agents and the Lenders would
otherwise have.
13.10 Counterparts. This Agreement may be executed in several
counterparts, and each executed copy shall constitute an original instrument,
but such counterparts shall together constitute but one and the same instrument.
13.11 Amendment and Waiver. No amendment or waiver of any provision of
this Agreement or any other Loan Document, or consent to any departure by the
Company or the Permitted Borrowers therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Lenders (or
signed by the Agent at the direction of the Required Lenders), and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that (X) no amendment,
waiver or consent shall increase the Percentage or the stated commitment amounts
applicable to any Lender unless approved, in writing, by the affected Lender and
(Y) no amendment, waiver or consent shall, unless in writing and signed by all
the Lenders, do any of the following: (a) increase the Revolving Credit
Aggregate Commitment to an amount greater than $400,000,000, (b) reduce the
principal of, or interest on, the Advances or any Fees or other amounts payable
hereunder, (c) postpone any date fixed for any payment of principal of, or
interest on, the outstanding Advances or any Fees or other amounts payable
hereunder, (d) waive any Event of Default specified in Section 9.1(a) or (b)
hereof, (e) release or defer the granting or perfecting of a lien or security
interest in any Collateral or release any guaranty or similar undertaking
provided by any Person or modify any indemnity provided to the Lenders,
hereunder or under the other Loan Documents, except as shall be otherwise
expressly provided in this Agreement or any other Loan Document, (f) take any
action which requires the signing of all Lenders pursuant to the terms of this
Agreement or any other Loan Document, (g) change the aggregate unpaid principal
amount of the outstanding Advances which shall be required for the Lenders or
any of them to take any action under this Agreement or any other Loan Document,
(h) change this Section 13.11, or (i) change the definition of "Required
Lenders", "Interest Periods", "Alternative Currencies", "Permitted Borrower" or
"Percentage"; and provided further, however, that no amendment, waiver or
consent hereunder shall, unless in writing and signed (x) by the Agent, in
addition to all the Lenders, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, whether in its capacity as Agent or the
issuing bank or (y) by the Swing Line Bank, in addition to all the Lenders,
affect the rights or duties of the Swing Line Bank under this Agreement or any
other Loan Documents, in its capacity as Swing Line Bank. All references in this
Agreement to "Lenders" or "the Lenders" shall refer to all Lenders, unless
expressly stated to refer to "Required Lenders.
109
13.12 Taxes and Fees. Should any tax (other than a tax based upon the net
income of any Lender or Agents (or either of them) by any jurisdiction where a
Lender or Agent is located), recording or filing fee become payable in respect
of this Agreement or any of the other Loan Documents or any amendment,
modification or supplement hereof or thereof, the Company and each of the
Permitted Borrowers agree to pay the same together with any interest or
penalties thereon and agree to hold the Agent and the Lenders harmless with
respect thereto.
13.13 Confidentiality. Each Lender agrees that without the prior consent
of Company, it will not disclose (other than to its employees or to employees of
any of its Affiliates, to another Lender or to any of their respective auditors
or counsel) any information with respect to the Company or any of its
Subsidiaries or any of the Permitted Borrowers which is furnished pursuant to
the terms and conditions of this Agreement or any of the other Loan Documents or
which is designated (in writing) by Company or any of the Permitted Borrowers to
be confidential; provided that any Lender may disclose any such information (a)
as has become generally available to the public or has been lawfully obtained by
such Lender from any third party under no duty of confidentiality to the Company
or such Permitted Borrower known to such Lender after reasonable inquiry, (b) as
may be required or appropriate in any report, statement or testimony submitted
to, or in respect of any inquiry by, any municipal, state or federal regulatory
body having or claiming to have jurisdiction over such Lender, including the
Board of Governors of the Federal Reserve System of the United States or the
Federal Deposit Insurance Corporation or similar organizations (whether in the
United States or elsewhere) or their successors, (c) as may be required or
appropriate in respect of any summons or subpoena or in connection with any
litigation, (d) in order to comply with any law, order, regulation or ruling
applicable to such Lender, and (e) to any permitted transferee or assignee or to
any approved participant of, or with respect to, an interest in this Agreement
and the other Loan Documents, as aforesaid, and (f) with respect to the "tax
treatment" and "tax structure," in each case, within the meaning of I.R.C.
Regulation Section 1.6011-4, of the transactions contemplated hereby and all
materials of any kind (including opinions or other tax analyses) that are
provided to Agent or such Bank relating to such tax treatment and tax structure,
to the extent required to be disclosed pursuant to such regulation or the
Internal Revenue Code, provided that with respect to any document or similar
item that in either case contains information concerning the tax treatment or
tax structure of the transaction as well as other information, this sentence
shall only apply to such portions of the document or similar item that relate to
the tax treatment or tax structure of the transactions contemplated hereby.
13.14 Withholding Taxes. If any Lender is not incorporated under the laws
of the United States or a state thereof, such Lender shall deliver to the Agent
and the Company promptly upon becoming a Lender hereunder and from time to time
as reasonably requested by the Company (but in any event prior to the initial
payment of interest hereunder) two executed copies of (i) Internal Revenue
Service Form W-8 BEN or applicable successor form specifying the applicable tax
treaty between the United States and the jurisdiction of such Lender's domicile
which provides for the exemption from withholding on interest payments to such
Lender, (ii) Internal Revenue Service Form W-8 ECI or applicable successor form
evidencing that the income to be received by such Lender hereunder is
effectively connected with the conduct of a trade or business in the United
States or (iii) other evidence satisfactory to the Agent that such Lender is
exempt from United States income tax withholding with respect to such income;
provided, however, that such Lender shall not be required to deliver to Agent
the aforesaid forms
110
or other evidence with respect to (i) Advances to any Foreign Subsidiary which
is or becomes a Permitted Borrower hereunder or (ii) with respect to Advances to
the Company or any Domestic Subsidiary which subsequently becomes a Permitted
Borrower hereunder, if such Lender has assigned its interest in the Revolving
Credit (including any outstanding Advances thereunder and participations in
Letters of Credit issued hereunder) and any Notes issued to it by the Company,
or any Domestic Subsidiary (if any) which subsequently becomes a Permitted
Borrower hereunder, to an Affiliate which is incorporated under the laws of the
United States or a state thereof, and so notifies the Agent. Such Lender shall
amend or supplement any such form or evidence as required to insure that it is
accurate, complete and non-misleading at all times. Promptly upon notice from
the Agent of any determination by the Internal Revenue Service that any payments
previously made to such Lender hereunder were subject to United States income
tax withholding when made, such Lender shall pay to the Agent the excess of the
aggregate amount required to be withheld from such payments over the aggregate
amount actually withheld by the Agent. In addition, from time to time upon the
reasonable request and at the sole expense of the Company or the Permitted
Borrowers, each Lender and each of the Agents shall (to the extent it is able to
do so based upon applicable facts and circumstances), complete and provide the
Company or the Permitted Borrowers with such forms, certificates or other
documents as may be reasonably necessary to allow the Company or the Permitted
Borrowers, as applicable, to make any payment under this Agreement or the other
Loan Documents without any withholding for or on the account of any tax under
Section 10.1(d) hereof (or with such withholding at a reduced rate), provided
that the execution and delivery of such forms, certificates or other documents
does not adversely affect or otherwise restrict the right and benefits
(including without limitation economic benefits) available to such of the Lender
or the Agents, as the case may be, under this Agreement or any of the other Loan
Documents, or under or in connection with any transactions not related to the
transactions contemplated hereby.
13.15 ERISA Restrictions. To the extent any Advance hereunder is funded by
or on behalf of an insurance company, bank, or other Person deemed to hold
assets of any employee benefit plan subject to ERISA or other plan as defined in
and subject to the prohibited transaction provisions of Section 4975 of the
Internal Revenue Code pursuant to applicable Department of Labor regulations
(the "Plan Asset Regulations"), or any such plan acting on its own behalf, such
insurance company, bank, entity or plan warrants and represents that at least
one of the following statements is an accurate representation as to each source
of funds (a "Source") to be used by such insurance company, bank, entity or plan
to fund the Advance(s) hereunder:
(a) the Source consists of plan assets subject to the discretionary
authority or control of an in-house asset manager ("INHAM") as such
term is defined in Section IV(a) of Prohibited Transaction Class
Exemption 96-23 (issued April 10, 1996) ("PTCE 96-23"), and the
funding of the Advance(s) hereunder is exempt under the provisions
of PTCE 96-23; or
(b) the Source is an "insurance company general account" as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 (issued July 12, 1995) ("PTCE 95-60"), and the funding of the
Advance(s) hereunder is exempt under the provisions of PTCE 95-60;
or
111
(c) the Source is either (x) an insurance company pooled separate
account, within the meaning of Prohibited Transaction Class
Exemption 90-1 (issued January 29, 1990) ("PTCE 90-1") or (y) a bank
collective investment fund, within the meaning of Prohibited
Transaction Class Exemption 91-38 (issued July 12, 1991) ("PTCE
91-38") and, except as such insurance company or bank has disclosed
to the Company in writing pursuant to this paragraph (ii), no plan
or group of plans maintained by the same employer or employee
organization, beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; and, in either such case, all records necessary to establish
the availability of each exemption by reason thereof will be
maintained and made available as required by the terms of such
exemption; or
(d) the Source is an "investment fund" (within the meaning of Part V of
Prohibited Transaction Class Exemption 84-14 (issued March 13, 1984)
(the "QPAM Exemption")) managed by a "qualified professional asset
manager" ("QPAM") within the meaning of Part V of the QPAM
exemption) which has been identified pursuant to this paragraph
(iii), such that the funding of the Advance(s) by or on behalf of
such investment fund is exempt from the application of the
prohibited transaction rules of ERISA and Section 4975 of the
Internal Revenue Code, provided that no party to the transactions
described in this Agreement and no affiliate (within the meaning of
Section V(c)(1) of the QPAM Exemption) of such party has, or at any
time during the immediately preceding year exercised, the authority
to appoint or terminate the identified QPAM as manager of the assets
of any employee benefit plan that has an interest in such investment
fund (which plans have been identified pursuant to this paragraph
(iii)) or to negotiate the terms of said QPAM's management agreement
on behalf of any such identified plan; or
(e) the Source is a "governmental plan" as defined in Title 1, Section
3(32) of ERISA; or
(f) the Source is one or more "employee benefit plans" (or other plan as
defined in and subject to Section 4975 of the Internal Revenue Code)
or a separate account, trust fund, or other entity comprised of one
or more such plans (determined after giving effect to the Plan Asset
Regulations) each of which has been identified to the Company in
writing pursuant to this paragraph (v); or
(g) the Source does not include assets of any employee benefit plan or
other plan, other than a plan exempt from coverage under ERISA and
from the prohibited transactions of Section 4975 of the Internal
Revenue Code.
13.16 Effective Date. This Agreement shall become effective upon the
Effective Date, and shall remain effective until the Indebtedness has been
repaid and discharged in full and no commitment to extend any credit hereunder
remains outstanding. Those Permitted Borrowers not signatories to this Agreement
on the Effective Date shall become obligated hereunder (and shall be deemed
parties to this Agreement) upon the execution and delivery, according to the
terms and conditions set forth in Section 2.1 hereof, of the Permitted Borrower
Addendum.
112
13.17 Severability. In case any one or more of the obligations of the
Company or any of the Permitted Borrowers under this Agreement, or any of the
other Loan Documents shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
obligations of the Company or such Permitted Borrower shall not in any way be
affected or impaired thereby, and such invalidity, illegality or
unenforceability in one jurisdiction shall not affect the validity, legality or
enforceability of the obligations of the Company or such Permitted Borrower
under this Agreement or any of the other Loan Documents in any other
jurisdiction.
13.18 Table of Contents and Headings; Construction of Certain Provisions.
The table of contents and the headings of the various subdivisions hereof are
for convenience of reference only and shall in no way modify or affect any of
the terms or provisions hereof. If any provision of this Agreement or any of the
other Loan Documents refers to any action to be taken by any Person, or which
such Person is prohibited from taking, such provision shall be applicable
whether such action is taken directly or indirectly by such Person, whether or
not expressly specified in such provision.
13.19 Independence of Covenants. Each covenant hereunder shall be given
independent effect (subject to any exceptions stated in such covenant) so that
if a particular action or condition is not permitted by any such covenant
(taking into account any such stated exception), the fact that it would be
permitted by an exception to, or would be otherwise within the limitations of,
another covenant shall not avoid the occurrence of a Default or an Event of
Default if such action is taken or such condition exists.
13.20 Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of the Company or any
party to any of the Loan Documents made herein or in any of the other Loan
Documents or in any certificate, report, financial statement or other document
furnished by or on behalf of the Company, any such party in connection with this
Agreement or any of the other Loan Documents shall be deemed to have been relied
upon by the Lenders, notwithstanding any investigation heretofore or hereafter
made by any Lender or on such Lender's behalf, and those covenants and
agreements of the Company and the Permitted Borrowers set forth in Section 11.8
hereof (together with any other indemnities of the Company or the Permitted
Borrowers contained elsewhere in this Agreement or in any of the other Loan
Documents and of Lenders set forth in Sections 12.1, 12.12 and 13.13 hereof
shall, notwithstanding anything to the contrary contained in this Agreement,
survive the repayment in full of the Indebtedness and the termination of any
commitments to make Advances hereunder.
13.21 Lien Release and Revival. Agent, on behalf of the Lenders, shall be
entitled to retain a first perfected security interest in and Liens on all
Collateral until the occurrence of the following events: (a) the Debt issued
pursuant to the BCc Replacement Refinancing has been converted into equity, and
(b) the rated Senior Debt of the Company (following such conversion) has a
rating of BB+ or better from S&P and a rating of Ba1 or better from Moody's.
Upon the occurrence of the events specified in subsections (a) and (b), as
aforesaid, and so long as no Default or Event of Default shall have occurred and
be continuing, the Agent, on behalf of the Lenders, shall release its security
interest in and Liens on Collateral (excluding any pledge of or Lien on any
equity interests of the Company or any of its Subsidiaries and any Lien on
113
Intercompany Notes), and shall promptly file appropriate UCC-3 termination
statements evidencing such release in all applicable jurisdictions. If, at any
time after the Agent's initial release of Liens, the Company is no longer in
compliance with the condition specified in subsection (b) above, the grant of
Lien and other obligations of the Company and its Subsidiaries under the
Security Agreements, to the extent previously released, shall again
automatically be effective without any further action or consent on the part of
the Company, any Subsidiary or any party thereto. In addition, the Company and
each Subsidiary hereby irrevocably authorizes the Agent at any time and from
time to time to re-file in any filing office in any UCC jurisdiction any
financing statements and amendments thereto that (x) indicate any or all of the
Collateral upon which the Company and its Subsidiaries have granted a Lien, and
(y) provide any other information required by Part 5 of Article 9 of the Uniform
Commercial Code, upon the Company's failure to satisfy, at any time, the
requirements set forth in subsection (b) above. The Company and its Subsidiaries
shall provide the Agent with any information it may require in order to prepare
and re-file such financing statements. Following such re-filing, the Agent, on
behalf of the Lenders, shall have a first perfected security interest in and
Lien on all Collateral. In addition, upon the Company's failure to satisfy, at
any time, the requirements set forth in subsection (b) above, Company hereby
agrees that it will, and will cause its Subsidiaries to, execute such additional
documentation, including Security Agreements or Reaffirmation of Security
Agreements as Agent or the Required Lenders shall reasonably require to ensure
the Agent's Lien on all Collateral.
13.22 Complete Agreement; Amendment and Restatements. This Agreement, the
Notes (if issued), any Requests for Advance or Letters of Credit hereunder, the
other Loan Documents and any agreements, certificates, or other documents given
to secure the Indebtedness, contain the entire agreement of the parties hereto,
and none of the parties hereto shall be bound by anything not expressed in
writing. This Agreement constitutes an amendment and restatement of the Prior
Credit Agreement, which Prior Credit Agreement is fully superseded and amended
and restated in its entirety hereby; provided, however, that the Indebtedness
governed by the Prior Credit Agreement shall remain outstanding and in full
force and effect and provided further that this Agreement does not constitute a
novation of such Indebtedness.
[SIGNATURES FOLLOW ON SUCCEEDING PAGES]
114
WITNESS the due execution hereof as of the day and year first above
written.
COMPANY: AGENT:
VISHAY INTERTECHNOLOGY, INC. COMERICA BANK, As Agent
By: /s/ Richard N. Grubb By: /s/
---------------------------- ---------------------------------
Its: Executive Vice President, Its: Vice President
Chief Financial Officer and One Detroit Center
Director 500 Woodward Avenue
63 Lincoln Highway Detroit, Michigan 48226
Malvern, Pennsylvania 19355 Attention: Corporate Finance
PERMITTED BORROWERS:
VISHAY EUROPE GmbH
By: /s/ Richard N. Grubb
----------------------------
Its: Vice President
VISHAY ELECTRONIC GmbH
By: /s/ Richard N. Grubb
----------------------------
Its: Vice President
115
COMERICA BANK, individually, as
Swing Line Bank and as Issuing Bank
By: /s/
---------------------------------
Its: Vice President
--------------------------------
FLEET NATIONAL BANK
By: /s/
---------------------------------
Its: Director
--------------------------------
JP Morgan Chase Bank
By: Robert M. Stanchak
---------------------------------
Its: Vice President
--------------------------------
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/
---------------------------------
Its: Director
--------------------------------
BANK OF AMERICA N.A.
By: /s/
--------------------------------
Its: Principal
-------------------------------
BANK LEUMI USA
By: /s/ /s/
---------------------------------
Its: AVP SVP
--------------------------------
BANK HAPOALIM B.M.,
NEW YORK BRANCH
By: /s/ Boaz Dan
---------------------------------
Its: First Vice President
--------------------------------
By: /s/ Maxie Levy
---------------------------------
Its: Vice President
--------------------------------
KEYBANK NATIONAL ASSOCIATION
By: /s/
---------------------------------
Its: Vice President
--------------------------------
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By: /s/ K. Ossolinski
---------------------------------
Its: Vice President
--------------------------------
THE BANK OF NOVA SCOTIA
By: /s/
---------------------------------
Its: Managing Director
--------------------------------
WESTLB AG, New York Branch
By: /s/ Salvator Battinelli
---------------------------------
Its: Managing Director
--------------------------------
By: /s/ Pascal Kabemba
---------------------------------
Its: Associate Director
--------------------------------
ISRAEL DISCOUNT BANK OF NEW YORK
By: /s/ Stephen R. Shapiro
---------------------------------
Its: FVP
--------------------------------
By: /s/ Mel Altman
---------------------------------
Its: OP
--------------------------------