$300,000,000
CREDIT AGREEMENT
dated as of June 29, 1999
among
DIMON INCORPORATED
As Borrower
-----------
THE LENDERS NAMED HEREIN
as Lenders
----------
NATIONSBANK, N.A.
as Administrative Agent
-----------------------
BANC OF AMERICA SECURITIES LLC
as Lead Arranger
----------------
FIRST UNION NATIONAL BANK
as Syndication Agent
--------------------
and
COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A.,
"RABOBANK INTERNATIONAL," NEW YORK BRANCH
as Managing Agent
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TABLE OF CONTENTS
ARTICLE I GENERAL DEFINITIONS.................................1
Section 1.1 Definitions..................................1
Section 1.2 Other Interpretative Provisions.............19
Section 1.3 Accounting Terms and
Determinations...................................20
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES.................21
Section 2.1 The Advances.................................21
Section 2.2 Evidence of Debt.............................21
Section 2.3 Making the Advances..........................22
Section 2.4 Conversion and Continuation
Elections....................................23
Section 2.5 Termination, Reduction or Increase
of Commitments...............................24
Section 2.6 Prepayments..................................26
Section 2.7 Repayment of the Obligations.................28
Section 2.8 Extension of Termination Date................28
Section 2.9 Interest.....................................29
Section 2.10 Fees........................................30
Section 2.11 Payments and Computations...................30
Section 2.12 Sharing of Payments, Etc....................31
Section 2.13 Limitation of Interest......................31
Section 2.14 Use of Proceeds.............................32
ARTICLE III YIELD PROTECTION, INTEREST RATE...................32
Section 3.1 Additional Interest on Eurodollar
Rate Advances................................32
Section 3.2 Interest Rate Determination and
Protection...................................32
Section 3.3 Increased Costs..............................34
Section 3.4 Illegality...................................34
Section 3.5 Taxes........................................35
Section 3.6 Funding Losses...............................37
Section 3.7 Certificates of Lenders......................38
Section 3.8 Replacement of a Lender......................38
Section 3.9 Survival.....................................39
ARTICLE IV CONDITIONS PRECEDENT..............................39
Section 4.1 Conditions of Initial Borrowing..............39
Section 4.2 Conditions to All Borrowings.................42
ARTICLE V REPRESENTATIONS AND WARRANTIES.....................42
Section 5.1 Corporate Existence and Power................42
Section 5.2 Corporate and Governmental
Authorization; Contravention.................43
Section 5.3 Binding Effect...............................43
Section 5.4 Financial Information........................43
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Section 5.5 Litigation...................................44
Section 5.6 Marketable Title.............................44
Section 5.7 Filings......................................44
Section 5.8 Regulation U.................................44
Section 5.9 Subsidiaries and Affiliates..................45
Section 5.10 Solvency....................................45
Section 5.11 ERISA Compliance............................45
Section 5.12 Taxes.......................................45
Section 5.13 Environmental Matters.......................45
Section 5.14 Regulated Entities..........................46
Section 5.15 No Burdensome Restrictions..................46
Section 5.16 Labor Relations.............................46
Section 5.17 Copyrights, Patents, Trademarks
and Licenses, etc...........................47
Section 5.18 Compliance With Laws........................47
Section 5.19 Broker's Fees; Transaction Fees.............47
Section 5.20 Full Disclosure.............................47
Section 5.21 Year 2000 Compliance........................48
ARTICLE VI FINANCIAL COVENANTS...............................48
Section 6.1 Consolidated Working Capital.................48
Section 6.2 Minimum Consolidated Tangible Net
Worth.......................................48
Section 6.3 Consolidated Fixed Charge Coverage
Ratio........................................49
Section 6.4 Consolidated Leverage Ratio..................49
Section 6.5 Consolidated Total Senior Debt to
Borrowing Base Ratio.........................49
Section 6.6 Calculations.................................49
ARTICLE VII AFFIRMATIVE COVENANTS............................50
Section 7.1 Information..................................50
Section 7.2 Payment of Obligations.......................53
Section 7.3 Maintenance of Property; Insurance...........54
Section 7.4 Conduct of Business and Maintenance
of Existence.................................54
Section 7.5 Compliance with Laws.........................54
Section 7.6 Accounting; Inspection of Property,
Books and Records............................54
Section 7.7 Additional Guarantors........................55
Section 7.8 ERISA........................................55
Section 7.9 Year 2000 Compliance.........................55
ARTICLE VIII NEGATIVE COVENANTS..............................55
Section 8.1 Restriction on Liens.........................55
Section 8.2 Debt.........................................57
Section 8.3 Guarantees...................................58
Section 8.4 Consolidations, Mergers and Sale of
Assets.......................................58
Section 8.5 Acquisitions and Investments.................59
Section 8.6 Transactions with Other Persons..............61
Section 8.7 Transactions with Affiliates.................62
Section 8.8 Compliance with ERISA........................62
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Section 8.9 Change in Structure..........................62
Section 8.10 Restrictions on Negative Pledges............62
Section 8.11 Limitation on Dividend
Restrictions................................63
Section 8.12 Payments of Subordinated Debt
Securities..................................63
Section 8.13 Maximum Uncommitted Inventories.............63
ARTICLE IX EVENTS OF DEFAULT.................................63
Section 9.1 Events of Default............................63
Section 9.2 Remedies.....................................66
ARTICLE X ADMINISTRATIVE AGENT, SYNDICATION AGENT AND
MANAGING AGENT.............................................67
Section 10.1 Authorization and Action....................67
Section 10.2 Administrative Agent's Reliance,
etc.........................................67
Section 10.3 NationsBank, FUNB, Rabobank and
Affiliates..................................68
Section 10.4 Lender Credit Decision......................68
Section 10.5 Indemnification.............................68
Section 10.6 Successor Administrative Agent..............69
Section 10.7 Notice of Default...........................69
Section 10.8 Administrative Agent's Fee..................69
ARTICLE XI MISCELLANEOUS.....................................70
Section 11.1 Notices....................................70
Section 11.2 No Waivers.................................70
Section 11.3 Expenses; Indemnity........................70
Section 11.4 Amendments, etc............................71
Section 11.5 Successors and Assigns.....................72
Section 11.6 Right of Set-off...........................75
Section 11.7 CONSENT TO JURISDICTION....................75
Section 11.8 VIRGINIA LAW...............................76
Section 11.9 Counterparts; Effectiveness................76
Section 11.10 WAIVER OF JURY TRIAL.......................76
Section 11.11 Termination of Existing Credit
Agreement..................................77
Section 11.12 Confidentiality............................77
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SCHEDULES AND EXHIBITS
----------------------
Schedule 1.1 - Applicable Margin Calculation
Schedule 2.10 - Commitment Fee Calculation
Schedule 5.5 - Litigation
Schedule 5.9 - List of Subsidiaries and Affiliates
Schedule 5.13 - Environmental Matters
Schedule 5.17 - Intellectual Property Matters
Schedule 8.1 - Existing Liens
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Subsidiary Guaranty
Exhibit C - Form of Promissory Note
Exhibit D - Form of Notice of Borrowing
Exhibit E - Form of Notice of
Continuation/Conversion
Exhibit F - Opinion of Counsel to the Borrower and
the Guarantors
Exhibit G - Form of New Commitment Agreement
Exhibit H - Form of Borrowing Base Certificate
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is entered into as of June
29, 1999 by and among DIMON INCORPORATED, a Virginia
corporation ("Borrower"), the lenders listed on the
signature pages hereof (each, a "Lender" and
collectively, together with their successors and
permitted assigns, the "Lenders"), NATIONSBANK, N.A., a
national banking association ("NationsBank"), as
administrative agent for the Lenders hereunder (in such
capacity, the "Administrative Agent"), FIRST UNION
NATIONAL BANK ("FUNB"), as Syndication Agent for the
Lenders hereunder (in such capacity, the "Syndication
Agent"), and COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK INTERNATIONAL," NEW YORK
BRANCH ("Rabobank"), as managing agent for the Lenders
hereunder (in such capacity, the "Managing Agent").
ARTICLE I
---------
GENERAL DEFINITIONS
-------------------
Section 1.1 Definitions.
The following terms, as used herein, shall have the following
meanings:
"Acquisition" shall mean any transaction, or any series of
related transactions, by which the Borrower and/or any of its
Subsidiaries directly or indirectly (a) acquires any ongoing
business or all or substantially all of the assets of any Person
or division thereof, whether through purchase of assets, merger
or otherwise, (b) acquires (in one transaction or as the most
recent transaction in a series of transactions) control of at
least a majority in ordinary voting power of the securities of
a Person which have ordinary voting power for the election of
directors or (c) otherwise acquires control of a 50% or more
ownership interest in any such Person.
"Additional Commitment" means, with respect to any lender
which executes a New Commitment Agreement in accordance with
Section 2.5(d), the commitment of such Lender in an aggregate
principal amount up to the amount specified in such New Commitment
Agreement to make Advances in accordance with the provisions of
Section 2.1.
"Administrative Agent" shall mean NationsBank or any
successor administrative agent appointed pursuant to Article X.
"Advance" shall mean an advance by a Lender to the Borrower
pursuant to Article II, and refers to a Base Rate Advance or a
Eurodollar Rate Advance (each of which shall be a "Type" of Advance).
"Advances on Tobacco" means loans, advances and extensions of
credit made by the Borrower or any of its Subsidiaries to growers
and other suppliers of tobacco (including Affiliates) and tobacco
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growers' cooperatives, whether short-term or long-term, in the
ordinary course of business to finance the growing or processing
of tobacco.
"Affiliate" shall mean, as to any Person, any other Person
which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. A Person shall be
deemed to control another Person if the controlling Person
possesses, directly or indirectly, the power to direct or cause
the direction of the management and policies of the other Person,
whether through the ownership of voting securities, by contract or
otherwise. Without limitation, any beneficial owner of ten percent
(10%) or more of the equity of a Person shall, for the purposes of
this Agreement, be deemed to control the other Person.
"Aggregate Commitment" shall mean the combined Commitments of
the Lenders in the amount of Three Hundred Million Dollars
($300,000,000), as such amount may be increased or reduced from
time to time pursuant to this Agreement.
"Agreement" shall mean this Credit Agreement, together with
all Schedules and Exhibits hereto, each as amended, modified or
supplemented from time to time in accordance with the terms hereof.
"Applicable Lending Office" shall mean, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case
of a Eurodollar Rate Advance.
"Applicable Margin" shall mean (a) with respect to each Base
Rate Advance, zero percent (0%) per annum, and (b) with respect to
each Eurodollar Rate Advance, (i) 2.50% per annum (which includes
the Borrowing Base Premium) from the Closing Date through the date
on which the Administrative Agent first receives the officer's
certificate to be furnished by the Borrower pursuant to Section 7.1(c)
of this Agreement, and (ii) thereafter, the rate per annum derived
from the formula set forth on Schedule 1.1 attached hereto. The
Applicable Margin with respect to both Base Rate Advances and
Eurodollar Rate Advances shall be increased upon the occurrence
and during the continuance of an Event of Default (including after the
acceleration of the Obligations), by an additional two percent (2%)
per annum.
"Approved Accounting Firm" shall mean PricewaterhouseCoopers LLP
or any other independent public accountants selected by the Borrower
and satisfactory to the Required Lenders.
"Asset Sale" shall have the meaning given to such term in the
Senior Indenture.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an Eligible Assignee and
consented to by the Borrower and the Administrative Agent, in
substantially the form of Exhibit A hereto or such other form as
shall be accepted by the Administrative Agent.
"BAS" shall mean Banc of America Securities LLC, and its
successors.
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"Base Rate" shall mean, for any period, a fluctuating interest
rate per annum as shall be in effect from time to time, which rate
per annum shall at all times be equal to the highest of:
(i) the rate of interest announced publicly by
NationsBank in Charlotte, North Carolina, from time to time,
as NationsBank's prime rate; or
(ii) one half of one percent (1/2 of 1%) per annum
above the latest three-week moving average of secondary market
morning offering rates in the United States for three-month
certificates of deposit of major United States money center
banks, such three-week moving average being determined weekly
on each Monday (or, if any such day is not a Business Day, on
the next succeeding Business Day) for the three-week period
ending on the previous Friday by NationsBank on the basis of
such rates reported by certificate of deposit dealers to and
published by the Federal Reserve Bank of New York or, if such
publication shall be suspended or terminated, on the basis of
quotations for such rates received by NationsBank from three
New York certificate of deposit dealers of recognized standing
selected by NationsBank, in either case adjusted to the
nearest one sixteenth of one percent (1/16 of 1%) or, if
there is no nearest one sixteenth of one percent (1/16 of 1%),
to the next higher one sixteenth of one percent (1/16 of 1%);
or
(iii) one half of one percent (1/2 of 1%) per
annum above the Federal Funds Rate.
"Base Rate Advance" shall mean an Advance which bears interest
as provided in Section 2.9(a).
"Borrower" shall mean DIMON Incorporated, a Virginia
corporation, and its successors.
"Borrowing" shall mean a borrowing consisting of Advances of
the same Type made on the same day by the Lenders, and in the case
of Eurodollar Rate Advances, with the same Interest Period. All
Advances made as, Converted to, or Continued as, the same Type and
(in the case of Eurodollars Advances) with the same Interest Period
on the same day shall be deemed to constitute a single Borrowing
until paid, prepaid or next Converted or Continued.
"Borrowing Base" means, as of any day, the sum of (a) 80% of
Eligible Receivables, plus (b) 80% of total Advances on Tobacco,
plus (c) 80% of Committed Inventories constituting Eligible
Inventory, plus (d) 50% of Uncommitted Inventories constituting
Eligible Inventory, in each case as set forth in the most recent
Borrowing Base Certificate delivered to the Administrative Agent
and the Lenders in accordance with the terms of Section 7.1(d).
"Borrowing Base Certificate" shall have the meaning assigned
to such term in Section 7.1(d).
"Borrowing Base Premium" shall have the meaning assigned to
such term in Schedule 1.1.
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"Brazilian Tax Assessment" shall mean that certain assessment
imposed on the Borrower by the Brazilian taxing authorities for
calendar years 1988 through 1992, in an amount, together with all
interest and penalties, not exceeding $21,277,000 as of June 30,
1998, as more fully described in Note Q to the Borrower's
consolidated financial statements for the fiscal year ended
June 30, 1998 and incorporated into the Borrower's 1998 Annual
Report.
"Business Day" shall mean a day of the year on which banks
are not required or authorized to close in Charlotte, North
Carolina or New York City and, if the applicable Business Day
relates to any Eurodollar Rate Advances, on which dealings in
Dollars are carried on in the London interbank market.
"Calculation Period" shall mean as of the last day of any
fiscal quarter the four fiscal-quarter period of the Borrower
ending on such date.
"Capital Lease" shall mean a lease that should be capitalized
on a balance sheet of the lessee prepared in accordance with GAAP.
"Change of Control" means such time as:
(i) any Person or group (within the meaning of Section
13(d) or 14(d) of the Securities Exchange Act) has become,
directly or indirectly, the beneficial owner, by way of
merger, consolidation or otherwise, of 30% or more of the
voting power of the Voting Stock of the Borrower on a
fully-diluted basis, after giving effect to the conversion
and exercise of all outstanding warrants, options and other
securities of the Borrower convertible into or exercisable
for Voting Stock of the Borrower (whether or not such
securities are then currently convertible or exercisable);
or
(ii) the sale, lease or transfer of all or substantially
all of the consolidated assets of the Borrower to any Person
or group; or
(iii) during any period of two consecutive calendar
years, individuals who at the beginning of such period
constituted the Board of Directors of the Borrower, together
with any new members of such Board of Directors whose election
by such Board of Directors or whose nomination for election
by the stockholders of the Borrower was approved by a vote of
a majority of the members of such Board of Directors then still
in office who either were directors at the beginning of such
period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a
majority of the directors of the Borrower then in office; or
(iv) the Borrower consolidates with or merges with or
into another Person or any Person consolidates with, or merges
with or into, the Borrower (in each case, whether or not in
compliance with the terms of this Agreement), in any such event
pursuant to a transaction in which immediately after the
consummation thereof Persons owning a majority of the Voting
Stock of the Borrower immediately prior to such consummation
shall cease to own a majority of the Voting Stock of the
Borrower; or
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(v) the occurrence of a "Change of Control" under and
as defined in the Subordinated Indenture.
"Closing Date" shall mean June 29, 1999, the date as of which
this Agreement and the other Loan Documents were executed and
delivered by the parties hereto.
"Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"Commitment" shall have the meaning set forth in Section 2.1.
"Commitment Percentage" shall mean, as to any Lender, the
percentage equivalent of such Lender's Commitment divided by the
Aggregate Commitment.
"Committed Inventories" shall mean tobacco inventories for
which the Borrower has received a Confirmed Order.
"Confirmed Order" shall mean an order by a customer not an
Affiliate of the Borrower which has been accepted in the ordinary
course of business by representatives of the Borrower or an
Affiliate of the Borrower and recorded on the inventory records of
such Affiliate or the Borrower.
"Consolidated Net Capital Expenditures" shall mean, for any
fiscal period of the Borrower, the greater of (i) the difference
between (a) all expenditures by the Borrower and its Subsidiaries
during such period for the acquisition or leasing of any fixed
assets or improvements, or for replacements, substitutions or
additions thereto, which have a useful life of more than one year
(such fixed assets or improvements referred to as "Capital
Assets") and which are or should be reflected on the Borrower's
consolidated statement of cash flows for such period as
capital expenditures in accordance with GAAP less (b) the net
cash proceeds received by the Borrower and its Subsidiaries
during such period from the sale of Capital Assets and (ii)
zero.
"Consolidated EBIT" shall mean, for any fiscal period of
the Borrower, the sum (without duplication) of (i) Consolidated
Net Income of the Borrower for such period, plus (ii) the
Consolidated Income Tax Expense deducted in determining such
Consolidated Net Income, plus (iii) the Consolidated Interest
Expense deducted in determining such Consolidated Net Income,
minus (iv) any extraordinary items of gain included in
Consolidated Net Income for such period, determined for
the Borrower and its Subsidiaries on a consolidated
basis in accordance with GAAP.
"Consolidated EBITDA" shall mean, for any fiscal
period of the Borrower, the sum of (i) Consolidated
EBIT for such period, plus (ii) the aggregate amount of
the Borrower's depreciation expense and amortization
expense for such period to the extent deducted in
determining Consolidated Net Income, in each case
determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" shall
mean, at any date, the ratio of (a) the sum of (i)
Consolidated EBITDA for the Calculation Period ending
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on such date, minus (ii) Consolidated Income Tax
Expense for such Calculation Period, minus (iii)
Consolidated Net Capital Expenditures for such
Calculation Period, plus (iv) Consolidated Rental
Expense for such Calculation Period to (b) the sum of
(i) scheduled payments of principal of the Borrower's
Consolidated Funded Debt during such Calculation Period
(including, without limitation, the principal component
of scheduled payments under Capital Leases), plus (ii)
Consolidated Interest Expense for such Calculation
Period, plus (iii) the amount of dividends,
distributions, stock repurchases and stock redemptions
paid in cash by the Borrower or any of its Subsidiaries
(other than any such dividend, distribution, stock
repurchase or stock redemption payments made to the
Borrower or any of its Subsidiaries) during such
Calculation Period, plus (iv) Consolidated Rental
Expense for such Calculation Period, in each case
determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Funded Debt" shall mean, at any
date, all liabilities of the Borrower and its
Subsidiaries that are or should be reflected at such
date on the Borrower's consolidated balance sheet as
long-term debt and current maturities of long-term debt
in accordance with GAAP.
"Consolidated Income Tax Expense" shall mean, for
any fiscal period of the Borrower, the Borrower's
income tax expense for such period, determined for the
Borrower and its Subsidiaries on a consolidated basis
in accordance with GAAP.
"Consolidated Interest Expense" shall mean, for
any fiscal period of the Borrower, the Borrower's
interest expense for such period (including, without
limitation, the interest component of payments under
Capital Leases), determined for the Borrower and its
Subsidiaries on a consolidated basis in accordance with
GAAP.
"Consolidated Leverage Ratio" shall mean, at any
date, the ratio of (a) Consolidated Total Debt to (b)
the sum of (i) Consolidated Net Worth, plus (ii)
Consolidated Total Debt.
"Consolidated Net Income" shall mean, for any
fiscal period of the Borrower, the Borrower's net
income (or net loss) for such period, determined for
the Borrower and its Subsidiaries on a consolidated
basis in accordance with GAAP.
"Consolidated Net Worth" shall mean, at any date,
(a) the Borrower's total stockholders' equity at such
date, without giving effect to (i) the effect of
foreign currency translation adjustments under
Financial Accounting Standards Board Statement No. 52,
"Foreign Currency Translation", (ii) the effect of the
adjustments to the value of the Borrower's investments
in debt and equity securities under Financial
Accounting Standards Board Statement No. 115,
"Accounting For Certain Investments In Debt And Equity
Securities", and (iii) the effect of the cost of post
retirement benefits to employees of the Borrower under
Financial Accounting Standards Board Statement No. 106,
"Employer's Accounting for Postretirement Benefits
Other Than Pensions", minus (b) any write-up of the
Borrower's assets subsequent to June 30, 1999,
determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
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"Consolidated Rental Expense" shall mean, for any
fiscal period of the Borrower, the Borrower's rental
expense under Operating Leases for such period,
determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Tangible Net Worth" shall mean, at
any date, the sum of (i) Consolidated Net Worth, minus
(ii) the amount of the Borrower's intangible assets at
such date, including, without limitation, goodwill
(whether representing the excess of cost over book
value of assets acquired, or otherwise), capitalized
expenses, patents, trademarks, tradenames, copyrights,
franchises, licenses and deferred charges (such as,
without limitation, unamortized costs and costs of
research and development), all determined for the
Borrower and its Subsidiaries on a consolidated basis
in accordance with GAAP.
"Consolidated Total Assets" shall mean, at any
date, the Borrower's total assets, as determined for
the Borrower and its Subsidiaries on a consolidated
basis in accordance with GAAP.
"Consolidated Total Debt" shall mean, at any date,
the aggregate amount of all Debt which creates
Consolidated Interest Expense, whether or not such
interest is deferred.
"Consolidated Total Senior Debt" shall mean, at
any date, the aggregate principal amount of (a) short-
term bank debt, (b) outstanding Advances, (c) the
Senior Debt Securities, (d) current maturities of long-
term debt, (e) customer advances and (f) other senior
Debt, in each case as determined for the Borrower and
its Subsidiaries on a consolidated basis in accordance
with GAAP.
"Consolidated Total Senior Debt to Borrowing Base
Ratio" shall mean, at any date, the ratio of (a)
Consolidated Total Senior Debt to (b) the Borrowing
Base.
"Consolidated Working Capital" shall mean, at any
date, the amount by which the Borrower's current assets
exceed its current liabilities at such date, determined
on a consolidated basis for the Borrower and its
Subsidiaries in accordance with GAAP.
"Continue", "Continuation" and "Continued" shall
each refer to the continuation of a Borrowing comprised
of Eurodollar Rate Advances for a subsequent Interest
Period upon the expiration of the preceding Interest
Period pursuant to Section 2.4.
"Convert", "Conversion" and "Converted" shall each
refer to a conversion of Advances of one Type into
Advances of another Type pursuant to Section 2.4 or
Section 3.2.
"Covenant Defeasance" shall mean an election by
the Borrower under the Senior Indenture to release the
obligations of the Borrower under the Senior Debt
Securities with respect to certain covenants set forth
in the Senior Indenture.
"Debt" of any Person shall mean, at any date,
without duplication, (i) all obligations of such Person
for borrowed money, (ii) all obligations of such Person
evidenced by bonds, debentures, notes or other similar
instruments, (iii) all obligations of such Person to
pay the deferred purchase price of property or services
(except trade accounts payable arising in the ordinary
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course of business), (iv) all obligations of such
Person as lessee under Capital Leases, (v) all
obligations of such Person to purchase securities or
other property which arise out of or in connection with
the sale of the same or substantially similar
securities or property, (vi) all non-contingent
obligations of such Person to reimburse any other
Person in respect of amounts paid under letters of
credit, surety and appeal bonds and performance bonds
or similar instruments assuring any other Person of the
performance of any act or acts or the payment of any
obligation, (vii) all obligations of others secured by
a Lien on any asset of such Person, whether or not such
obligation is assumed by such Person and (viii) the
principal portion of all obligations of such Person
under any synthetic lease or other similar off-balance
sheet financing product.
"Default" shall mean any condition or event
specified in Section 9.1 which with the giving of
notice or lapse of time or both would, unless cured or
waived, become an Event of Default.
"Dollars" and "$" the sign shall each mean the
lawful currency of the United States of America.
"Domestic Lending Office" shall mean, with respect
to each Lender, its office located at its address set
forth on the signature pages hereof (or identified on
the signature pages hereof as its Domestic Lending
Office) or such other office as such Lender may
hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Administrative Agent.
"Domestic Subsidiary" shall mean any Subsidiary of
the Borrower which is not a Foreign Subsidiary.
"Eligible Assignee" shall mean (i) a commercial
bank organized under the laws of the United States, or
any state thereof, and having a combined capital and
surplus of at least $100,000,000; (ii) a commercial
bank organized under the laws of any other country
which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a
combined capital and surplus of at least $100,000,000,
provided that such bank is acting through a branch or
agency located in the United States; (iii) a Lender or
any Affiliate of a Lender; and (iv) any other Person
approved by the Administrative Agent and the Borrower;
provided, however, that no Person who is a nonresident
alien or a foreign entity for United States income tax
purposes (except a commercial bank of the type
described in clause (ii) above), may be an Eligible
Assignee unless each Note to be acquired by such Person
is reissued in registered form prior to transfer.
"Eligible Inventory" means, as of any date of
determination and without duplication, the lower of the
aggregate book value (based on an average cost
valuation, consistently applied in accordance with GAAP
principles) or fair market value of all raw materials
and finished goods inventory owned by the Borrower or
any of its Material Domestic Subsidiaries less
appropriate reserves determined in accordance with GAAP
but excluding in any event (i) inventory subject to a
Lien that is not a Permitted Lien, (ii) inventory which
is not in good condition or fails to meet standards for
sale or use imposed by governmental agencies,
departments or divisions having regulatory authority
over such goods, (iii) inventory which is not useable
- -8-
(122)
or salable and (iv) inventory which fails to meet such
other specifications and requirements as may from time
to time be established by the Administrative Agent in
its reasonable discretion.
"Eligible Receivables" means, as of any date of
determination and without duplication, the aggregate
book value of all accounts receivable, receivables, and
obligations for payment created or arising from the
sale of inventory or the rendering of services in the
ordinary course of business (collectively, the
"Receivables"), owned by or owing to the Borrower or
any of its subsidiaries, net of allowances and reserves
for doubtful or uncollectible accounts and sales
adjustments consistent with such Person's internal
policies and in any event in accordance with GAAP, but
excluding in any event (i) any Receivable which is
subject to a Lien that is not a Permitted Lien, (ii)
Receivables which are more than 90 days past due (net
of reserves for bad debts in connection with any such
Receivables), (iii) 50% of the book value of any
Receivable not otherwise excluded by clause (ii) above
but owing from an account debtor which is the account
debtor on any existing Receivable then excluded by such
clause (ii), unless the exclusion by such clause (ii)
is a result of a legitimate dispute by the account
debtor and the applicable Receivable is no more than 90
days past due, (iv) Receivables owing by an account
debtor which is not solvent or is subject to any
bankruptcy or insolvency proceeding of any kind, (v)
Receivables which are contingent or subject to offset,
deduction, counterclaim, dispute or other defense to
payment, in each case to the extent of such offset,
deduction, counterclaim, dispute or other defense, (vi)
Receivables for which any direct or indirect Subsidiary
or any Affiliate is the account debtor and (vii)
Receivables which fail to meet such other
specifications and requirements as may from time to
time be established by the Administrative Agent in its
reasonable discretion.
"Environmental Claim" shall mean any claim,
however asserted, by any Governmental Authority or
other Person alleging potential liability or
responsibility for violation of any Environmental Law
or for release into or injury to the environment or
threat to public health, personal injury (including
sickness, disease or death), property damage, natural
resources damage, or otherwise alleging liability or
responsibility for damages (punitive or otherwise),
cleanup, investigation, removal, remedial or response
costs, litigation costs, restitution, civil or criminal
penalties, injunctive relief, or other type of relief,
resulting from or based upon (a) the presence,
placement, discharge, emission or release (including
intentional and unintentional, negligent and non-
negligent, sudden or non-sudden, accidental or non-
accidental placement, spills, leaks, discharges,
emissions, releases or threatened releases) of any
Hazardous Material at, in, or from property, whether or
not owned by the Borrower or any of its subsidiaries,
or (b) any other circumstances forming the basis of any
violation, or alleged violation, of any Environmental
Law.
"Environmental Law" shall mean any federal, state
or local law, statute, ordinance, code, rule,
regulation, decree, order, judgment, or principles of
common law relating to (i) releases or threatened
releases of Hazardous Materials or materials containing
Hazardous Materials; (ii) the manufacture, handling,
transport, use, treatment, storage or disposal of
Hazardous Materials or materials containing Hazardous
Materials; or (iii) otherwise relating to the
environment or to the protection of human health.
- -9-
(123)
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time, and
the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" shall mean any Person who for
purposes of Title IV of ERISA would, together with the
Borrower or any of its Subsidiaries, be treated as
members of the same "controlled group" within the
meaning of Section 4001(a)(14) of ERISA.
"ERISA Event" shall mean (i) a Reportable Event,
unless the 30-day notice requirement with respect
thereto has been waived by the PBGC; (ii) the provision
by the administrator of any Plan of a notice of intent
to terminate such Plan, pursuant to Section 4041(a)(2)
of ERISA (including any such notice with respect to a
plan amendment referred to in Section 4041(e) of
ERISA); (iii) the cessation of operations at a facility
in the circumstances described in Section 4062(e) of
ERISA; (iv) the withdrawal by the Borrower or an ERISA
Affiliate from a Multiemployer Plan during a plan year
for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (v) the failure by the
Borrower or any ERISA Affiliate to make a payment to a
Plan required under Section 302(f)(1) of ERISA, which
Section imposes a lien for failure to make required
payments; (vi) the adoption of an amendment to a Plan
requiring the provision of security to such Plan,
pursuant to Section 307 of ERISA; or (vii) the
institution by the PBGC of proceedings to terminate a
Plan, pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition which might
constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, a Plan.
"Eurocurrency Liabilities" shall have the meaning
assigned to that term in Regulation D of the Federal
Reserve Board, as in effect from time to time.
"Eurodollar Lending Office" shall mean, with
respect to each Lender, its office, branch or affiliate
located at its address set forth on the signature pages
hereof (or identified on the signature pages hereof as
its Eurodollar Lending Office) or such other office,
branch or affiliate of such Lender as it may hereafter
designate as its Eurodollar Lending Office by notice to
the Borrower and the Administrative Agent.
"Eurodollar Rate" shall mean, for any Interest
Period for each Eurodollar Rate Advance comprising part
of the same Borrowing, an interest rate per annum equal
to the average (rounded upward to the nearest whole
multiple of 1/16 of 1% per annum, if such average is
not such a multiple) of the rate per annum at which
deposits in Dollars are offered by the principal office
of each of the Reference Lenders to prime banks in the
London interbank market at 11:00 A.M. (London, England
time) two Business Days before the first day of such
Interest Period in an amount substantially equal to
such Reference Lender's Eurodollar Rate Advance
comprising part of such Borrowing and for a period
equal to such Interest Period. The Eurodollar Rate for
any Interest Period for each Eurodollar Rate Advance
comprising part of the same Borrowing shall be
determined by the Administrative Agent on the basis of
applicable rates furnished to and received by the
Administrative Agent from the Reference Lenders two
Business Days before the first day of such Interest
Period, subject, however, to the provisions of Section
3.2.
- -10-
(124)
"Eurodollar Rate Advance" shall mean an Advance
which bears interest is provided in Section 2.9(b).
"Eurodollar Rate Reserve Percentage", of any
Lender for any Interest Period for any Eurodollar Rate
Advance, shall mean the reserve percentage applicable
during such Interest Period (or if more than one such
percentage shall be so applicable, the daily average of
such percentages for those days in such Interest Period
during which any such percentage shall be so
applicable) under regulations issued from time to time
by the Federal Reserve Board for determining the
maximum reserve requirement (including, without
limitation, any emergency, supplemental or other
marginal reserve requirement) for such Lender with
respect to liabilities or assets consisting of or
including Eurocurrency Liabilities having a term equal
to such Interest Period.
"Event of Default" shall have the meaning set
forth in Section 9.1; provided that any requirement for
notice or lapse of time or both shall have been
satisfied.
"Excess Proceeds" shall have the meaning given to
such term in the Senior Indenture.
"Exempt Asset Sale" shall have the meaning given
to such term in the Senior Indenture.
"Existing Credit Agreement" shall have the meaning
given to such term in Section 4.1(c).
"FUNB" shall mean First Union National Bank and
its successors.
"Federal Funds Rate" shall mean, for any period, a
fluctuating interest rate per annum equal for each day
during such period 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 the Administrative
Agent from three federal funds brokers of recognized
standing selected by it.
"Federal Reserve Board" shall mean the Board of
Governors of the Federal Reserve System, or any
successor thereto.
"Fee Letter" shall mean the fee letter agreement,
dated April 6, 1999, among the Borrower, NationsBank
and BAS.
"Foreign Subsidiary" shall mean any Subsidiary of
the Borrower (i) which is organized under the laws of
any jurisdiction outside of the United States of
America, (ii) which conducts the major portion of its
business outside of the United States of America and
(iii) all or substantially all of the property and
assets of which are located outside of the United
States of America.
"GAAP" shall mean generally accepted accounting
principles in the United States, as set forth from time
to time in the opinions and pronouncements of the
Accounting Principles Board and the American Institute
of Certified Public Accountants and statements and
- -11-
(125)
pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable
stature and authority within the accounting
profession), which are applicable to the circumstances
as of the date of determination; provided, however,
that, in the event any changes are mandated by any of
the accounting authorities noted above, such changes
shall be included in GAAP as applicable to the Borrower
(and its Subsidiaries) only from and after such date as
the Borrower and the Required Lenders shall have
amended this Agreement to the extent necessary to
reflect any such changes in the financial covenants set
forth in Article VI hereto (and any related defined
terms).
"Governmental Authority" shall mean any nation or
government, any state or other political subdivision
thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising
executive, legislative, judicial, regulatory or
administrative functions of or pertaining to
government, and any corporation or other entity owned
or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
"Guarantee" shall mean, with respect to any
Person, any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing, or
making such Person contingently liable for, any Debt or
other obligation of any other Person and, without
limiting the generality of the foregoing, includes any
obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of)
such Debt or other obligation (whether arising by
virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or
services, to take-or-pay, or to maintain financial
statement conditions or otherwise), (ii) entered into
for the purpose of assuring in any other manner the
obligee of such Debt or other obligation of the payment
thereof or to protect such obligee against loss in
respect thereof (in whole or in part) or (iii) to
reimburse any bank or other Person in respect of
amounts paid or payable under letters of credit surety
and appeal bonds and performance bonds or similar
instruments assuring any other Person of the
performance of any act or acts or the payment of any
obligation; provided, that the term "Guarantee" shall
not include endorsements for collection or deposit in
the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Guarantors" shall mean, collectively, each
Domestic Subsidiary of the Borrower which becomes a
party to the Subsidiary Guaranty pursuant to Section
7.7 hereof.
"Hazardous Materials" shall mean (i) those
substances defined in or regulated as toxic or
hazardous under the following federal statutes and
their state counterparts, as well as the statutes'
implementing regulations, as amended from time to time:
the Hazardous Materials Transportation Act; the
Resource Conservation and Recovery Act; the
Comprehensive Environmental Response, Compensation and
Liability Act; the Clean Water Act; the Safe Drinking
Water Act; the Toxic Substances Control Act; the
Federal Insecticide, Fungicide and Rodenticide Act; the
Federal Food, Drug, and Cosmetic Act; and the Clean Air
Act; and (ii) any pollutant, contaminant or other
substance with respect to which a Governmental
Authority requires environmental investigation,
monitoring, reporting or remediation.
- -12-
(126)
"Hostile Acquisition" shall mean any Acquisition
involving a tender offer or proxy contest that has not
been recommended or approved by the board of directors
of the Person that is the subject of the Acquisition
prior to the first public announcement or disclosure
relating to such Acquisition.
"Insolvency Proceeding" shall mean (a) any case,
action or proceeding before any court or other
Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors, or (b)
any general assignment for the benefit of creditors,
composition, marshaling of assets for creditors or
other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors;
in the case of each of clauses (a) and (b), undertaken
under U.S. federal, state or foreign law, including the
Bankruptcy Reform Act of 1978 (12 U.S.C. 101, et
seq.), as amended.
"Insufficiency" shall mean, with respect to any
Plan, the amount, if any, of its unfunded benefit
liabilities, as defined in Section 4001(a)(18) of
ERISA.
"Interest Period" shall mean, for each Eurodollar
Rate Advance comprising part of the same Borrowing, the
period commencing on the date of such Advance or the
date of the Conversion of any Base Rate Advance into a
Eurodollar Rate Advance or of the Continuation of a
Eurodollar Rate Advance and ending on the last day of
the period selected by the Borrower pursuant to the
provisions below and, thereafter, each subsequent
period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of
the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest
Period shall be one, two, three or six months, in each
case as the Borrower may, upon notice received by the
Administrative Agent not later than 11:00 A.M.
(Charlotte, North Carolina time) on the second Business
Day prior to the first day of such Interest Period,
select; provided, that:
(i) no Interest Period may extend
beyond the Termination Date;
(ii) Interest Periods commencing on the
same date for Advances comprising part of the same
Borrowing shall be of the same duration;
(iii) whenever the last day of any
Interest Period would otherwise occur on a day
other than a Business Day, the last day of such
Interest Period shall be extended to occur on the
next succeeding Business Day; provided, that if
such extension would cause the last day of such
Interest Period to occur in the next following
calendar month, the last day of such Interest
Period shall occur on the next preceding Business
Day; and
(iv) there shall not be more than five
(5) Interest Periods under this Agreement in
effect at any time.
"Investment" shall mean, with respect to any
Person, any investment by that Person in any other
Person, whether by means of the purchase or other
acquisition of any stock, evidence of indebtedness or
other security of such Person, the making of any loan,
advance, guarantee or contribution of capital to such
Person, or the purchase of any other debt or equity
participation or interest in such Person, in each case
- -13-
(127)
other than an Acquisition. Each Investment shall be
valued as of the date made; provided that any
Investment or portion of an Investment consisting of
Debt shall be valued at the outstanding principal
balance thereof as of the date of determination.
"IRS" shall mean the Internal Revenue Service, an
agency of the United States government, or any
successor thereto.
"Legal Defeasance" shall mean an election by the
Borrower under the Senior Indenture to discharge the
obligations of the Borrower and the guarantors of the
Senior Debt Securities under or in respect of the
Senior Debt Securities.
"Lender" shall have the meaning assigned to such
term in the heading hereof.
"Lien" shall mean any mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit
arrangement, encumbrance, lien (statutory or other) or
preference, priority or other security interest or
preferential arrangement of any kind or nature
whatsoever (including those created by, arising under
or evidenced by any conditional sale or other title
retention agreement, the interest of a lessor under a
Capital Lease, any financing lease having substantially
the same economic effect as any of the foregoing, or
the filing of any financing statement naming the owner
of the asset to which such lien relates as debtor,
under the UCC or any comparable law) and any contingent
or other agreement to provide any of the foregoing, but
not including the interest of a lessor under an
Operating Lease.
"Loan Documents" shall mean a collective reference
to this Agreement, the Notes, the Subsidiary Guaranty,
the Fee Letter, each Notice of Borrowing, each Notice
of Continuation/Conversion and all documents delivered
to the Administrative Agent, the Syndication Agent, the
Managing Agent or the Lenders in connection therewith.
"Managing Agent" shall mean Rabobank.
"Margin Stock" shall mean margin stock, as such
term is defined in Regulation T, U or X of the Federal
Reserve Board.
"Material Adverse Effect" shall mean (a) a
material adverse change in, or a material adverse
effect, at such time or in the future, in or upon the
operations, business, properties or condition
(financial or otherwise) of the Borrower and its
Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Borrower or any
Guarantor to perform its obligations under any Loan
Document to which it is a party; or (c) a material
adverse effect upon the legality, validity, binding
effect or enforceability of any Loan Document.
"Material Domestic Subsidiary" shall mean any
Subsidiary of the Borrower which is organized under the
laws of the United States, any state thereof or the
District of Columbia and would constitute a
"significant subsidiary" of the Borrower as defined in
Rule 1.02 of Regulation S-X promulgated by the
- -14-
(128)
Securities and Exchange Commission except that for
purposes of this definition all references in such Rule
1.02 to "ten percent (10%)" shall be deemed to be
references to "five percent (5%)".
"Material Foreign Subsidiary" shall mean each
Foreign Subsidiary which constitutes a "significant
subsidiary" as such term is defined in Rule 1.02 of
Regulation S-X promulgated by the Securities and
Exchange Commission.
"Material Subsidiary" shall mean, collectively,
each of the Material Domestic Subsidiaries and the
Material Foreign Subsidiaries.
"Multiemployer Plan" shall mean a "multiemployer
plan" (as defined in Section 4001(a)(3) of ERISA) to
which the Borrower, any Subsidiary of the Borrower or
any ERISA Affiliate is or has been obligated to
contribute.
"NationsBank" shall mean NationsBank, N.A., and
its successors.
"Net Proceeds" shall have the meaning given to
such term in the Senior Indenture.
"New Commitment Agreement" shall have the meaning
given to such term in Section 2.5(d).
"Note" shall mean a promissory note of the
Borrower payable to the order of any Lender, in
substantially the form of Exhibit C hereto, evidencing
the aggregate indebtedness of the Borrower to such
Lender resulting from the Advances made by such Lender.
"Notice of Borrowing" shall mean a notice from the
Borrower to the Administrative Agent substantially in
the form of Exhibit D.
"Notice of Continuation/Conversion" shall mean a
notice from the Borrower to the Administrative Agent
substantially in the form of Exhibit E.
"Obligations" shall mean all present and future
indebtedness, liabilities and obligations of the
Borrower and each of the Guarantors owing to the
Administrative Agent, any Lender, or any Person
entitled to indemnification pursuant to Section 11.3,
or any of their respective successors, permitted
transferees or permitted assigns, arising under or in
connection with this Agreement, the Notes, the
Subsidiary Guaranty, the Fee Letter or any other Loan
Document.
"Operating Lease" shall mean any lease which is
not a Capital Lease.
"Other Taxes" shall have the meaning set forth in
Section 3.5(b).
"Payment Office" shall mean the office of the
Administrative Agent set forth on the Administrative
Agent's signature page to this Agreement.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any successor thereto.
- -15-
(129)
"Permitted Liens" shall mean the Liens referred to
in clauses (a) through (m) of Section 8.1.
"Person" shall mean an individual, a corporation,
a partnership, a limited liability company, an
association, a trust or any other entity or
organization, including a government or political
subdivision or an agency or instrumentality thereof.
"Plan" shall mean any "employee pension benefit
plan" (as defined in section 3(2) of ERISA) maintained
by or on behalf of the Borrower or any ERISA Affiliate
or to which the Borrower or any ERISA Affiliate is
obligated to contribute for any employees or former
employees of the Borrower or any ERISA Affiliate and
which is subject to the provisions of Title IV Of ERISA
(including a Multiemployer Plan).
"Pro Forma Basis" means, with respect to any
transaction, that such transaction shall be deemed to
have occurred as of the first day of the four fiscal-
quarter period ending as of the last day of the most
recent fiscal quarter preceding the date of such
transaction with respect to which the Administrative
Agent and the Lenders shall have received the financial
statements referred to in Section 7.1(a) or (b), as
applicable. As used herein, "transaction" means (i) any
incurrence, assumption or retirement of Debt as
referred to in Section 8.2, (ii) any corporate merger
or consolidation as referred to in Section 8.4, (iii)
any Acquisition as referred to in Section 8.5(a), (iv)
any Investment as referred to in Section 8.5(n) or (v)
any increase in the Aggregate Commitment as referred to
in Section 2.5(d). With respect to any transaction of
the type described in clause (i) above regarding Debt
which has a floating or formula rate, the implied rate
of interest for such Debt for the applicable period for
purposes of this definition shall be determined by
utilizing the rate which is or would be in effect with
respect to such Debt as at the relevant date of
determination.
"Rabobank" shall mean Cooperatieve Centrale
Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, and its successors.
"Reference Lenders" shall mean NationsBank, FUNB
and Rabobank and each such other Lender as may be
appointed pursuant to Section 11.5(j).
"Register" shall have the meaning given such term
in Section 11.5(c).
"Reportable Event" means any of the reportable
events described in Section 4043 of ERISA.
"Requirement of Law" shall mean, as to any Person,
any law (statutory or common), treaty, rule or
regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or
binding upon the Person or any of its property or to
which the Person or any of its property is subject.
"Required Lenders" shall mean at any time, a
minimum of four Lenders holding greater than 66 % of
- -16-
(130)
the aggregate unpaid principal amount of the Notes or,
if no Advances are at the time outstanding hereunder, a
minimum of four Lenders having greater than 66 % of the
Aggregate Commitment.
"Responsible Officer" shall mean any of the
president, chief executive officer, chief financial
officer, chief accounting officer, treasurer, executive
vice presidents or senior vice presidents of the
Borrower.
"Securities Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
"Senior Debt Securities" shall mean any one of the
8 7/8% Senior Notes Due 2006, in an aggregate principal
amount of $125,000,000, issued by the Borrower pursuant
to the Senior Indenture, as such Senior Debt Securities
may be supplemented, amended or otherwise modified from
time to time.
"Senior Indenture" shall mean that certain
Indenture, dated as of May 29, 1996, by and among the
Borrower, as issuer, and Crestar Bank, as trustee, as
supplemented, amended or otherwise modified from time
to time.
"Solvent" shall mean, as to the Borrower or any
Guarantor at any time, that (i) each of the fair value
and the present fair saleable value of such Person's
assets (including any rights of subrogation or
contribution to which such Person is entitled, under
any of the Loan Documents or otherwise) is greater than
such Person's debts and other liabilities (including
contingent, matured and unliquidated debts and
liabilities) and the maximum estimated amount required
to pay such debts and liabilities as such debt and
liabilities mature or otherwise become payable; (ii)
such Person is able and expects to be able to pay its
debts and other liabilities (including, without
limitation, contingent, unmatured and unliquidated
debts and liabilities) as they mature; and (iii) such
Person does not have unreasonably small capital to
carry on its business as conducted and as proposed to
be conducted.
"Split-Dollar Agreement" shall mean an agreement
between the Borrower or any of its Subsidiaries and an
employee of the Borrower or such Subsidiary (or one or
more affiliates of such employee that shall be the
owner of the policy of life insurance referred to
below), pursuant to which the Borrower or such
Subsidiary shall agree to fund non-scheduled premiums
under a policy of insurance on the life of such
employee and such employee (or such affiliate or
affiliates) shall agree to reimburse the Borrower or
such Subsidiary for such non-scheduled premiums upon
the termination of such agreement.
"Split-Dollar Assignment" shall mean a collateral
assignment executed and delivered in connection with a
Split-Dollar Program by an employee of the Borrower or
one of its Subsidiaries (or one or more affiliates of
such employee that shall be the owner of the policy of
life insurance referred to below), by which such
employee (or such affiliate or affiliates), as
collateral security for such employee's (or such
affiliate's or affiliates') obligations under the Split-
Dollar Agreement executed and delivered in connection
with such Split-Dollar Program, assigns to the Borrower
or such Subsidiary the policy of insurance on the life
of such employee contemplated by such Split-Dollar
Agreement.
- -17-
(131)
"Split-Dollar Program" shall mean an arrangement,
established under a Split-Dollar Agreement between the
Borrower or any of its Subsidiaries and an employee
thereof (or one or more affiliates of such employee),
whereby the Borrower or such Subsidiary establishes a
split-dollar life insurance program for the benefit of
such employee and agrees to pay non-scheduled premiums
under the life insurance policy issued in connection
therewith, subject to the obligation of such employee
(or such affiliate or affiliates) to reimburse the
aggregate amount of such nonscheduled premiums upon the
termination of such program.
"Subordinated Debt Securities" shall mean any one
of the 6 1/4% Convertible Subordinated Debentures due
March 31, 2007, in an original aggregate principal
amount of $140,000,000, issued by the Borrower pursuant
to the Subordinated Indenture (of which original
principal amount, $73,328,440 is outstanding as of the
Closing Date), as such Subordinated Debt Securities may
be supplemented, amended or otherwise modified from
time to time.
"Subordinated Indenture" shall mean that certain
Indenture, dated as of April 1, 1997, by and among the
Borrower and LaSalle National Bank, as trustee, as
supplemented, amended or otherwise modified from time
to time.
"Subsidiary" shall mean any corporation or other
entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the
board of directors or other persons performing similar
functions are at the time directly or indirectly owned
by the Borrower.
"Subsidiary Guaranty" shall mean that certain
continuing guaranty required to be executed and
delivered by each Material Domestic Subsidiary and, if
required by Section 7.7, each other Domestic
Subsidiary, in substantially the form of Exhibit B
attached hereto, guaranteeing all of the Obligations,
subject to the limitations set forth therein, as
hereafter amended, modified or supplemented.
"Syndication Agent" shall mean FUNB.
"Taxes" shall have the meaning set forth in
Section 3.5(a).
"Termination Date" shall mean the earlier to occur
of (i) June 29, 2001 or such later anniversary thereof
as the Commitments may have extended by the Lenders
pursuant to Section 2.8, or (ii) the date of
termination in whole of the Aggregate Commitment
pursuant to Section 2.5 or 9.2.
"UCC" shall mean the Uniform Commercial Code as in
effect in the Commonwealth of Virginia from time to
time.
"Uncommitted Inventories" shall mean tobacco
inventories for which the Borrower has not received a
Confirmed Order.
- -18-
(132)
"Unutilized Commitment" shall mean, with respect
to each Lender as of any date, an amount equal to (i)
the Commitment of such Lender as of such date, minus
(ii) the aggregate principal amount of such Lender's
Advances outstanding on such date.
"Voting Stock" shall mean, at any time, all
classes of capital stock of the Borrower then
outstanding and normally entitled to vote in the
election of directors.
"Wholly Owned Subsidiary" of any Person means a
Subsidiary of such Person all of the outstanding
capital stock or other ownership interests of which
(other than directors' qualifying shares) shall at the
time be owned by such Person or by one or more Wholly
Owned Subsidiaries of such Person or, in the case of
Subsidiaries that are not organized under the laws of
the United States of America, one of the fifty states
thereof or the District of Columbia, by one or more
nominees of such Person.
"Withdrawal Liability" shall have the meaning
given such term under Part 1 of Subtitle E of Title IV
of ERISA.
Section 1.2 Other Interpretative Provisions.
(a) Defined Terms. Unless otherwise
specified herein or therein, all terms defined in
this Agreement shall have the defined meanings
when used in any certificate or other document
made or delivered pursuant hereto. The meaning of
defined terms shall be equally applicable to the
singular and plural forms of the defined terms.
Terms (including uncapitalized terms) not
otherwise defined herein and that are defined in
the UCC shall have the meanings therein described.
(b) This Agreement. The words "hereof",
"herein", "hereunder" and words of similar import
when used in this Agreement shall refer to this
Agreement as a whole and not to any particular
provision of this Agreement; and, Section,
Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) Certain Common Terms.
(i) The term "documents" includes
any and all instruments, documents,
agreements, certificates, indentures, notices
and other writings, however evidenced.
(ii) The term "including" is not
limiting and means including without
limitation.
(d) Performance; Time. Whenever any
performance obligation hereunder (other than a
payment obligation) shall be stated to be due or
required to be satisfied on a day other than a
Business Day, such performance shall be made or
satisfied on the next succeeding Business Day. In
the computation of periods of time from a
specified date to a later specified date, the word
"from" means "from and including"; the words "to"
and "until" each mean "to but excluding", and the
word "through" means "to and including". If any
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(133)
provision of this Agreement refers to any action
taken or to be taken by any Person, or which such
Person is prohibited from taking, such provision
shall be interpreted to encompass any and all
means, direct or indirect, of taking, or not
taking, such action.
(e) Contracts. Unless otherwise expressly
provided herein, references to agreements and
other contractual instruments shall be deemed to
include all subsequent amendments and other
modifications thereto, but only to the extent such
amendments and other modifications are not
prohibited by the terms of any Loan Document.
(f) Laws. References to any statute or
regulation are to be construed as including all
statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting
the statute or regulation.
(g) Captions. The captions and headings of
this Agreement are for convenience of reference
only and shall not affect the interpretation of
this Agreement.
(h) Independence of Provisions. The parties
acknowledge that this Agreement and other Loan
Documents may use several different limitations,
tests or measurements to regulate the same or
similar matters, and that such limitations, tests
and measurements are cumulative and must each be
performed, except as expressly stated to the
contrary in this Agreement.
Section 1.3 Accounting Terms and Determinations.
(a) Unless otherwise specified herein, all
accounting terms used herein shall be interpreted,
all accounting determinations hereunder shall be
made, and all financial statements required to be
delivered hereunder shall be prepared in
accordance with GAAP as in effect from time to
time, applied on a basis consistent (except for
changes concurred in by the Borrower's Approved
Accounting Firm) with the audited consolidated
financial statements of the Borrower and its
Subsidiaries for the fiscal year ended June 30,
1998; provided, that if any change in GAAP after
June 30, 1998 in itself materially affects the
calculation of any financial covenant in
Article VI, the Borrower may by notice to the
Administrative Agent, or the Administrative Agent
(at the request of the Required Lenders) may by
notice to the Borrower, require that such covenant
thereafter be calculated in accordance with GAAP
as in effect, and applied by the Borrower,
immediately before such change in GAAP occurs. If
such notice is given, the compliance certificates
delivered pursuant to Section 7.1 after such
change occurs shall be accompanied by
reconciliations of the difference between the
calculations set forth therein and a calculation
made in accordance with GAAP as in effect from
time to time after such change occurs.
(b) References herein to "fiscal year" and
"fiscal quarter" refer to such fiscal periods of
the Borrower unless the context clearly indicates
otherwise.
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(134)
ARTICLE II
----------
AMOUNTS AND TERMS OF THE ADVANCES
---------------------------------
Section 2.1 The Advances.
Each Lender severally agrees, on the terms and
conditions hereinafter set forth, to make Advances to
this Borrower from time to time on any Business Day
during the period from the Closing Date until the
Termination Date in an aggregate amount not to exceed
at any time outstanding the amount set forth on such
Lender's signature page hereto under the heading
"Commitment," as such amount may be increased pursuant
to Section 2.5(d) or Section 2.8, reduced pursuant to
Section 2.5 or increased or reduced as a result of one
or more assignments pursuant to Section 11.5 (such
amount, as increased or reduced, hereinafter referred
to as such Lender's "Commitment"); provided, however,
that after giving effect to any Borrowing, the
aggregate principal amount of all outstanding
Borrowings shall not exceed the Aggregate Commitment.
Each Borrowing shall consist of Advances of the same
Type made on the same day by the Lenders ratably
according to their respective Commitment Percentages.
Within the limits of each Lender's Commitment, and
subject to the other terms and conditions of this
Agreement, the Borrower may borrow, prepay pursuant to
Section 2.6 and reborrow pursuant to this Section 2.1.
Section 2.2 Evidence of Debt.
(a) The Advances made by each Lender
pursuant to its Commitment shall be evidenced by a
Note payable to the order of that Lender in an
amount equal to its Commitment and, in accordance
with the provisions of this Section 2.2, by the
books and records of the Administrative Agent and
the Lenders.
(b) Each Lender shall maintain an account or
accounts evidencing each Advance made by such
Lender to the Borrower from time to time,
including the amounts of principal and interest
payable and paid to such Lender from time to time
under this Agreement.
(c) The Administrative Agent shall maintain
the Register pursuant to Section 11.5(c), and a
subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i)
the amount, type and Interest Period of each such
Advance hereunder, (ii) the amount of any
principal or interest due and payable or to become
due and payable to each Lender hereunder and (iii)
the amount of any sum received by the
Administrative Agent hereunder from or for the
account of the Borrower and each Lender's share
thereof.
(d) The entries made in the accounts,
Register and subaccounts maintained pursuant to
subsection (c) of this Section 2.2 (and, if
consistent with the entries of the Administrative
Agent, subsection (b)) shall be prima facie
evidence of the existence and amounts of the
obligations of the Borrower therein recorded;
provided, however, that any error or omission in
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(135)
such account, such Register or such subaccount, as
applicable, shall not in any manner affect the
obligation of the Borrower to repay the Advances
made by such Lender in accordance with the terms
hereof.
Section 2.3 Making the Advances.
(a) Each Borrowing shall be made upon the
Borrower's prior written notice delivered to the
Administrative Agent in accordance with Section
11.1 in the form of a Notice of Borrowing (which
notice of Borrowing must be received by the
Administrative Agent prior to 11:00 A.M.
(Charlotte, North Carolina time) (x) three
Business Days prior to the requested date of the
Borrowing, in the case of a Borrowing comprised of
Eurodollar Rate Advances; and (y) on the
requested, date of the Borrowing, in the case of a
Borrowing comprised of Base Rate Advances, and
shall be irrevocable upon receipt by the
Administrative Agent), specifying:
(i) the amount of the Borrowing,
which shall be in an aggregate minimum
principal amount of Ten Million Dollars
($10,000,000) or any integral multiple of One
Million Dollars ($1,000,000) in excess
thereof;
(ii) the requested Business Day on
which the Borrowing is to be made;
(iii) whether the Borrowing is
to be comprised of Eurodollar Rate Advances,
or Base Rate Advances; and
(iv) in the case of a Borrowing
comprised of Eurodollar Rate Advances, the
duration of the Interest Period applicable to
such Borrowing. If the Notice of Borrowing
shall fail to specify the duration of the
Interest Period for any Borrowing comprised
of Eurodollar Rate Advances, such Interest
Period shall be one month.
(b) Upon receipt of the Notice of Borrowing,
the Administrative Agent shall promptly notify
each Lender thereof and of the amount of such
Lender's Advance.
(c) Each Lender will make the amount of its
Advance available to the Administrative Agent
through such Lender's Applicable Lending Office
for the account of the Borrower at the
Administrative Agent's Payment Office by 1:00 P.M.
(Charlotte, North Carolina time) on the date for
such Borrowing requested by the Borrower in funds
immediately available to the Administrative Agent
in Dollars. Subject to the requirements of
Article IV, the proceeds of all such Borrowings
will then be made available to the Borrower by the
Administrative Agent at such office by crediting
the account of the Borrower on the books of the
Administrative Agent with the aggregate of the
amounts made available to the Administrative Agent
by the Lenders and in like funds as received by
the Administrative Agent.
(d) Unless the Administrative Agent shall
have received notice from a Lender prior to the
date of any Borrowing that such Lender will not
make available to the Administrative Agent the
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(136)
amount of such Lender's Advance, the
Administrative Agent may (but shall not be
required to) assume that such Lender has made such
amount available to the Administrative Agent on
the date of such Borrowing in accordance with
Section 2.3(c), and the Administrative Agent may,
in reliance upon such assumption, make available
to the Borrower on such date a corresponding
amount. If and to the extent that such Lender
shall not have so made such amount available to
the Administrative Agent, such Lender and the
Borrower severally agree to repay to the
Administrative Agent forthwith on demand such
corresponding amount, together with interest
thereon, for each day from the date such amount is
made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at
(i) in the case of the Borrower, the interest rate
applicable at the time to the Advances comprising
such Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate on each such day.
If such Lender shall repay to the Administrative
Agent such corresponding amount, such amount so
repaid shall constitute such Lender's Advance as
part of such Borrowing for purposes of this
Agreement.
(e) The failure of any Lender to make its
Advance in connection with any Borrowing shall not
relieve any other Lender of its obligation, if
any, hereunder to make its Advance on the date of
such Borrowing, but no Lender shall be responsible
for the failure of any other Lender to make the
Advance to be made by such other Lender on the
date of any Borrowing.
(f) Unless the Required Lenders shall
otherwise agree, during the existence of a Default
or an Event of Default, the Borrower may not elect
to have a Borrowing be made as, or Converted into
or Continued as, a Borrowing comprised of
Eurodollar Rate Advances.
Section 2.4 Conversion and Continuation Elections.
(a) The Borrower may, upon written notice to
the Administrative Agent in accordance with
Section 2.4(b):
(i) elect to Convert on any
Business Day any Borrowing comprised of Base
Rate Advances (or any part thereof in an
aggregate minimum principal amount of
$10,000,000 or any integral multiple of
$1,000,000 in excess thereof) into a
Borrowing comprised of Eurodollar Rate
Advances; or
(ii) elect to Convert on the last
day of the applicable Interest Period any
Borrowing comprised of Eurodollar Rate
Advances having Interest Periods maturing on
such day (or any part thereof in an aggregate
minimum principal amount of $10,000,000 or
any integral multiple of $1,000,000 in excess
thereof) into a Borrowing comprised of Base
Rate Advances; or
(iii) elect to Continue on the
last day of the applicable Interest Period
any Borrowing comprised of Eurodollar Rate
Advances having Interest Periods maturing on
such day (or any part thereof in an aggregate
minimum principal amount of $10,000,000 or
any integral multiple of $1,000,000 in excess
thereof).
- -23-
(137)
(b) The Borrower shall deliver a Notice of
Continuation/Conversion in accordance with Section
11.1 (which Notice of Continuation/Conversion must
be received by the Administrative Agent not later
than 11:00 A.M. (Charlotte, North Carolina time)
at least (x) three Business Days in advance of the
date of Conversion or Continuation, as applicable,
if the Advances are to be Converted into or
Continued as Eurodollar Rate Advances; and (y) on
the date of Conversion if the Advances are to be
Converted into Base Rate Advances, and shall be
irrevocable upon receipt by the Administrative
Agent), specifying:
(i) the proposed date of
Conversion or Continuation, as applicable;
(ii) the aggregate amount of the
Borrowing or part thereof to be Converted or
Continued;
(iii) the nature of the
proposed Conversion or Continuation; and
(iv) except in the case of the
Conversion of Eurodollar Rate Advances into
Base Rate Advances, the duration of the
requested Interest Period.
(c) If upon the expiration of any Interest
Period applicable to a Borrowing comprised of
Eurodollar Rate Advances, the Borrower has failed
to select timely a new Interest Period to be
applicable to such Borrowing, the Borrower shall
be deemed to have elected to Convert such
Borrowing into a Borrowing comprised of Base Rate
Advances effective as of the expiration of such
current Interest Period.
(d) Upon receipt of a Notice of Continua
tion/Conversion, the Administrative Agent will
thereafter promptly notify each Lender thereof,
or, if no timely notice is provided by the
Borrower with respect to a Borrowing comprised of
Eurodollar Rate Advances subject to an expiring
Interest Period, the Administrative Agent will
promptly notify each Lender of the automatic
Conversion of such Advances to Base Rate Advances.
Section 2.5 Termination, Reduction or Increase
of Commitments.
(a) Voluntary Termination or Reduction. The
Borrower may, upon not less than three Business
Days' prior notice to the Administrative Agent,
terminate the Aggregate Commitment or permanently
reduce the Aggregate Commitment by an aggregate
minimum amount of $10,000,000 or any integral
multiple of $1,000,000 in excess thereof;
provided, that, no such reduction or termination
shall be permitted if, after giving effect thereto
and to any prepayments of the Borrowings made on
the effective date thereof, the then-outstanding
principal amount of the Borrowings would exceed
the amount of the Aggregate Commitment then in
effect and, provided, further, that once reduced
in accordance with this Section 2.5, the Aggregate
Commitment may not be increased.
- -24-
(138)
(b) Mandatory Reduction. On any date that
the Advances are required to be prepaid and the
Commitments are required to be reduced pursuant to
the terms of Section 2.6(b), the Aggregate
Commitment automatically shall be permanently
reduced (without duplication) by the amount of
such required prepayment and reduction.
(c) General. Any reduction of the Aggregate
Commitment shall be applied to each Lender's
Commitment in accordance with such Lender's
Commitment Percentage. All commitment fees
accrued to, but not including, the effective date
of any reduction or termination of the Aggregate
Commitment shall be paid on the effective date of
such reduction or termination.
(d) Increase in Aggregate Commitment. The
Borrower shall have the right, upon at least ten
(10) Business Days' prior written notice to the
Administrative Agent at any time on or after the
Closing Date and prior to the Termination Date,
but not more than once per annum, to increase the
Aggregate Commitment by up to $100,000,000;
subject, however, in any such case, to
satisfaction of the following conditions
precedent:
(i) no Default or Event of Default
shall have occurred and be continuing on the
date on which such Aggregate Commitment
increase is to become effective;
(ii) both before and after giving effect
to such Aggregate Commitment increase on a
Pro Forma Basis, the Borrower shall be in
compliance with each of the financial
covenants set forth in Article VI of this
Agreement;
(iii) the representations and
warranties set forth in Article V of this
Agreement shall be true and correct in all
material respects on and as of the date on
which such Aggregate Commitment increase is
to become effective;
(iv) such Aggregate Commitment increase
shall be an integral multiple of $10,000,000
and shall in no event be less than
$25,000,000;
(v) after giving effect to such
Aggregate Commitment increase, the Aggregate
Commitment shall not exceed $400,000,000;
(vi) such requested Aggregate Commitment
increase shall be effective on such date only
to the extent that, on or before such date,
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(139)
the Administrative Agent shall have received
and accepted from one or more Eligible
Assignees an agreement in the form of Exhibit
G hereto (each such agreement a "New
Commitment Agreement"), with respect to the
Additional Commitment of such Lender;
(vii) receipt by each Lender that
funds a portion of the Additional Commitment
of a duly executed promissory note in the
amount of such Lenders' aggregate Commitment;
and
(viii) on or before the date on which
such Aggregate Commitment increase is to
become effective, the Administrative Agent
shall have received, for its own account, an
administrative fee of $3,500 to be paid by
the Borrower in connection with such
increase.
(e) Adjustments of Commitment Percentages.
Upon the effectiveness of the increase in the
Aggregate Commitment pursuant to subsection (d),
the Commitment Percentage of each Lender shall be
automatically adjusted so that, after giving
effect to such adjustment, the Commitment
Percentage of each Lender (other than a Lender
whose Commitment shall have been increased in
connection with such increase in the Aggregate
Commitment) multiplied by the Aggregate Commitment
shall, before and after giving effect to such
increase, be equal.
(f) Adjustments of Outstanding Advances. If
and when any adjustment is made to the Commitment
Percentage of any Lender pursuant to subsection
(e) at any time when any Advances are outstanding,
the Borrower, the Administrative Agent and the
Lenders will use all commercially reasonable
efforts to assign and assume outstanding Advances
to conform the respective amounts thereof held by
each Lender to the respective Commitment
Percentages as so adjusted, it being understood
that the parties hereto shall use commercially
reasonable efforts to avoid prepayment or
assignment of any Advance that is a Eurodollar
Rate Advance on a day other than the last day of
the Interest Period applicable thereto.
Section 2.6 Prepayments.
(a) Optional. Subject to Section 3.4, the
Borrower may, at any time or from time to time,
upon at least three (3) Business Days' notice with
respect to Borrowings comprised of Eurodollar Rate
Advances, and same Business Day's notice with
respect to Borrowings comprised of Base Rate
Advances, to the Administrative Agent received by
11:00 A.M. (Charlotte, North Carolina time),
ratably prepay Borrowings in whole or in part, in
amounts of $10,000,000 or any integral multiple of
$1,000,000 in excess thereof, together with
interest thereon and (in the case of a prepayment
of any Borrowings comprised of Eurodollar Rate
Advances on a day that is not the last day of the
Interest Period applicable thereto) any cost, loss
or expense specified in Section 3.6. Such notice
of prepayment shall specify the date and amount of
such prepayment and whether such prepayment is of
Borrowings comprised of Base Rate Advances, or
Borrowings comprised of Eurodollar Rate Advances,
or any combination thereof. Such notice shall not
thereafter be revocable by the Borrower and the
Administrative Agent will promptly notify each
Lender thereof and of the amount of such Lender's
Commitment Percentage of such prepayment. If such
notice is given by the Borrower, the Borrower
shall make such prepayment and the payment amount
specified in such notice shall be due and payable
on the date specified therein, together with
accrued interest to each such date on the amount
prepaid and (in the case of a prepayment of any
Borrowings comprised of Eurodollar Rate Advances
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(140)
on a day that is not the last day of the Interest
Period applicable thereto) any amounts required
pursuant to Section 3.6.
(b) Mandatory. In the event that Borrower
or any of its Subsidiaries intends to make any
Asset Sale (other than an Exempt Asset Sale) that
would involve an aggregate sale price (including
cash and non-cash consideration) in excess of 10%
of Consolidated Total Assets as of the most recent
fiscal year end with respect to which the
Administrative Agent and the Lenders shall have
received the financial statements referred to in
Section 7.1(a)(i):
(i) the Borrower will give the
Administrative Agent, not later than the date
of such Asset Sale, written notice thereof
specifying the manner in which the Borrower
intends to apply the Net Proceeds of such
Asset Sale, and, in the event that the
Borrower elects to make a voluntary
prepayment, repurchase, redemption or
retirement of any of the Senior Debt
Securities with any of such Net Proceeds,
then, at the request of the Required Lenders,
the Borrower shall simultaneously pay or
prepay the outstanding Advances, if any, and
reduce the Commitments, in the amount
specified by the Required Lenders, such
amount in any event not to exceed the amount
equal to the percentage of the Net Proceeds
applied or to be applied to such voluntary
prepayment, repurchase, redemption or
retirement of Senior Debt Securities obtained
by dividing (1) the then current Aggregate
Commitment by (2) the sum of (x) the
aggregate then outstanding principal amount
of all Senior Debt Securities plus (y) the
then current Aggregate Commitment; and
(ii) if the Borrower shall not
previously have made any payment or
prepayment of the Advances with the Net
Proceeds of such Asset Sale pursuant to the
terms of clause (i) above, the Borrower will
give the Administrative Agent, not later than
the date which is 250 days after the date of
such Asset Sale, written notice specifying
the amount of the Net Proceeds of such Asset
Sale which, on the date which is 270 days
after the date of such Asset Sale, are
expected by the Borrower to become Excess
Proceeds, then, at the request of the
Required Lenders, the Borrower shall,
simultaneously with the purchase of any
Senior Debt Securities pursuant to the Senior
Indenture, pay or prepay the outstanding
Advances, if any, and reduce the Commitments,
in the amount specified by the Required
Lenders, such amount in any event not to
exceed the amount equal to the percentage of
the Net Proceeds of such Asset Sale exceeding
$10,000,000.00 obtained by dividing (1) the
then current Aggregate Commitment by (2) the
sum of (x) the aggregate then outstanding
principal amount of all Senior Debt
Securities plus (y) the Aggregate Commitment;
and
The Administrative Agent hereby agrees to promptly
notify each of the Lenders of receipt by the
Administrative Agent of any notice from the
Borrower pursuant to this Section 2.6(b).
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(141)
Payments and prepayments pursuant to this Section
2.6(b) shall be applied, first to Base Rate
Advances and then to Eurodollar Rate Advances in
direct order of Interest Period maturities.
(c) General. All prepayments of Advances
shall be subject to Section 3.6 but otherwise
without premium or penalty and shall be
accompanied by accrued interest on the principal
amount being prepaid to the date of prepayment and
all other amounts due and payable hereunder with
respect to such Loans.
Section 2.7 Repayment of the Obligations.
The Borrower shall repay in full the aggregate
outstanding Obligations on the Termination Date.
Section 2.8 Extension of Termination Date.
(a) The Borrower may request an extension of
the initial Termination Date, or if previously
extended, the then-applicable Termination Date,
for an additional twelve (12) month period in the
case of each such extension by delivering an
irrevocable written notice to the Administrative
Agent, accompanied by projections prepared by the
Borrower with respect to such extension period
containing such information as may be reasonably
requested by the Administrative Agent (which
notice, together with such projections, shall
promptly be forwarded by the Administrative Agent
to the Lenders), not more than one hundred twenty
(120) nor less than ninety (90) days prior to the
anniversary of the Closing Date that precedes the
then-effective Termination Date by one year (any
such request, an "Extension Request"). Upon
receipt of such Extension Request, each Lender
shall respond to the Borrower and the
Administrative Agent in writing no later than
sixty (60) days prior to such anniversary of the
Closing Date, either irrevocably consenting to
such Extension Request or declining to extend such
Lender's Commitment. Any determination by any
Lender to consent to an extension of the
Termination Date shall be in its sole and absolute
discretion and, subject to receipt by the Borrower
and the Administrative Agent of such consent,
there shall be no obligation on the part of any
Lender hereunder, whether express or implied, to
extend the Termination Date. Any Lender which
fails to respond by the date set forth above shall
be deemed to have declined the Extension Request.
Upon receipt of the written consent to such
Extension Request by the Borrower and the
Administrative Agent from Lenders holding 100% of
the Aggregate Commitment, the Administrative Agent
shall notify the Borrower and the Lenders that the
Termination Date has been extended for an
additional twelve (12) month period.
(b) In the event any Lender shall fail to
consent to an Extension Request within the time
provided in paragraph (a) above (each such Lender,
a "Non-Extending Lender"), the Borrower may obtain
one or more other Lenders or, with the consent of
the Administrative Agent, one or more other
Eligible Assignees willing to replace such Non-
Extending Lender (each such Eligible Assignee, a
"Replacement Lender"); provided, that, any
replacement must occur on or prior to the
anniversary of the Closing Date that precedes the
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(142)
then-effective Termination Date by one year. Any
Non-Extending Lender that is being replaced shall
assign its Advances and its Commitment hereunder
to any Replacement Lender upon not less than five
(5) days' prior written notice from the Borrower
in accordance with the assignment procedure set
forth in Section 11.5 hereof; provided that the
Borrower shall pay the administrative fee for such
assignment to the Administrative Agent specified
in Section 11.5. Upon receipt of duly executed
Assignment and Acceptances with respect to the
Commitments and outstanding Advances of each Non-
Extending Lender and the satisfaction of the
conditions set forth therein and in Section 11.5,
the Administrative Agent shall notify the Borrower
and the Lenders that the Termination Date has been
extended for an additional twelve (12) month
period.
(c) If the Borrower does not replace each
Non-Extending Lender with one or more Replacement
Lenders assuming all of the Advances and
Commitments of such Non-Extending Lenders by the
anniversary of the Closing Date that precedes the
then-Effective Termination Date by one year, the
Termination Date shall not be extended beyond its
then-existing date unless the Borrower, the
Administrative Agent and each of the Lenders
(other than any Non-Extending Lenders) shall
otherwise agree; provided that, the Non-Extending
Lenders shall not be bound by any such agreement.
Section 2.9 Interest.
The Borrower shall pay interest on the unpaid
principal amount of each Advance made by each Lender
from the date of such Advance until such principal
amount shall be paid in full, at the following rates
per annum:
(a) Base Rate Advance. During such periods
as such Advance is a Base Rate Advance, a rate per
annum at all times equal to the sum of the Base
Rate in effect from time to time plus the
Applicable Margin, payable in arrears
(i) quarterly on the last day of each calendar
quarter during such periods, (ii) on the date such
Base Rate Advance shall be Converted or paid in
full and (iii) on the Termination Date.
(b) Eurodollar Rate Advances. During such
periods as such Advance is a Eurodollar Rate
Advance, a rate per annum at all times during each
Interest Period for such Advance equal to the sum
of the Eurodollar Rate for such Interest Period
for such Advance plus the Applicable Margin,
payable in arrears (i) on the last day of such
Interest Period, (ii) if any Interest Period
exceeds three months, on the last day of each
three month period comprising such Interest
Period, (iii) on the date such Eurodollar Rate
Advance shall be paid in full and (iv) on the
Termination Date.
(c) Interest After Default. While any Event
of Default exists (including after the
acceleration of the Obligations), in addition to
paying accrued interest on the outstanding
Advances, the Borrower shall pay interest on the
amount of all other outstanding Obligations
(including accrued but unpaid interest to the
extent permitted by law) at a rate per annum equal
to the Base Rate plus the Applicable Margin then
in effect for Base Rate Advances. While any Event
of Default exists (including after the
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acceleration of the Obligations), the Borrower
shall pay interest on all of the Obligations upon
demand of the Administrative Agent and interest
shall continue to accrue on the unpaid Obligations
after as well as before entry of judgment thereon
to the extent permitted by law.
Section 2.10 Fees.
The Borrower agrees to pay to the Administrative
Agent, for the account of each Lender, a commitment fee
on the average daily Unutilized Commitment of such
Lender, from the date hereof in the case of each Lender
named on the signature pages to this Agreement and from
the effective date specified in the Assignment and
Acceptance or the New Commitment Agreement, as
applicable, pursuant to which it became a Lender in the
case of each other Lender, until the Termination Date,
payable quarterly on the last day of each calendar
quarter during the term of such Lender's Commitment,
commencing on June 30, 1999, and ending on the
Termination Date, at the rate equal to (i) from the
Closing Date through the date on which the
Administrative Agent first receives the officer's
certificate to be furnished by the Borrower pursuant to
Section 7.1(c) of this Agreement, the per annum rate
determined by reference to Category 3 on Schedule 2.10,
and (ii) thereafter, the rate determined by reference
to the formula set forth on Schedule 2.10. The
commitment fees provided in this Section 2.10 shall
accrue at all times after the date hereof, including
any time during which one or more conditions in Article
IV are not met.
Section 2.11 Payments and Computations.
(a) The Borrower shall make each payment
hereunder and under the Notes not later than 11:00
A.M. (Charlotte, North Carolina time) on the day
when due in Dollars to the Administrative Agent at
its Payment Office in same day funds. The
Administrative Agent will promptly thereafter
cause to be distributed like funds relating to the
payment of principal or interest or fees ratably
in accordance with such Lender's Commitment
Percentage (other than amounts payable pursuant to
Article III) to the Lenders for the account of
their respective Applicable Lending Offices, and
like funds relating to the payment of any other
amount payable to any Lender to such Lender for
the account of its Applicable Lending Office, in
each case to be applied in accordance with the
terms of this Agreement.
(b) The Borrower hereby authorizes each
Lender, if and to the extent payment owed to such
Lender is not made by the Borrower pursuant to the
terms hereof, when due hereunder or under the Note
held by such Lender, to charge from time to time
against any or all of the Borrower's accounts with
such Lender any amount so due.
(c) All computations of interest based on
the Base Rate shall be made by the Administrative
Agent on the basis of a year of 365 or 366 days,
as the case may be, and all computations of
interest based on the Eurodollar Rate or the
Federal Funds Rate and of fees shall be made by
the Administrative Agent, and all computations of
interest pursuant to Section 3.1 shall be made by
a Lender, on the basis of a year of 360 days, in
each case for the actual number of days (including
the first day but excluding the last day)
occurring in the period for which such interest or
fees are payable. Each determination by the
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Administrative Agent (or, in the case of Section
3.1, by a Lender) of an interest rate hereunder
shall be conclusive and binding for all purposes,
absent manifest error.
(d) Whenever any payment hereunder or under
the Notes shall be stated to be due on a day other
than a Business Day, such payment shall be made on
the next succeeding Business Day, and such
extension of time shall in such case be included
in the computation of payment of interest or fees,
as the case may be.
(e) Unless the Administrative Agent shall
have received notice from the Borrower prior to
the date on which any payment is due to the
Lenders hereunder that the Borrower will not make
such payment in full, the Administrative Agent may
assume that the Borrower has made such payment in
full to the Administrative Agent on such date, and
the Administrative Agent may (but shall not be
required to), in reliance upon such assumption,
cause to be distributed to each Lender on such due
date an amount equal to the amount then due such
Lender. If and to the extent the Borrower shall
not have so made such payment in full to the
Administrative Agent, each Lender shall repay to
the Administrative Agent forthwith on demand such
amount distributed to such Lender together with
interest thereon, for each day from the date such
amount is distributed to such Lender until the
date such Lender repays; such amount to the
Administrative Agent, at the Federal Funds Rate as
in effect for each such day.
Section 2.12 Sharing of Payments, Etc.
If any Lender shall obtain any payment (whether
voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the
Advances made by it (other than pursuant to Article
III) in excess of its ratable share of payments on
account of the Advances obtained by all the Lenders,
such Lender shall forthwith purchase from the other
Lenders such participations in the Advances made by
them as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of
them; provided, that if all or any portion of such
excess payment is thereafter recovered from such
purchasing Lender, such Purchase from each Lender shall
be rescinded and such Lender shall repay to the
purchasing Lender the purchase price to the extent of
such recovery together with an amount equal to such
Lender's ratable share (according to the proportion of
(i) the amount of such Lender's required repayment to
(ii) the total amount so recovered from the purchasing
Lender) of any interest or other amount paid or payable
by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant
to this Section 2.12 may, to the fullest extent
permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such
participation as fully as if such Lender were the
direct creditor of the Borrower in the amount of such
participation.
Section 2.13 Limitation of Interest.
It is the intention of the parties hereto that
each of the Lenders shall conform strictly to usury
laws applicable to it, if any. Accordingly, if the
transactions with the Lenders contemplated hereby would
be usurious under applicable law, if any, then, in that
event, notwithstanding anything to the contrary in the
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Notes, this Agreement or any other Loan Document it is
agreed as follows: (i) the aggregate of all
consideration which constitutes interest under
applicable law that is contracted for, taken, reserved,
charged or received by the Lenders under any Note, this
Agreement or under any other Loan Document shall under
no circumstances exceed the maximum amount allowed by
such applicable law and any excess shall be canceled
automatically, and if theretofore paid, shall at the
option of any Lender be credited by such Lender on the
principal amount of the Obligations owed to such Lender
by the Borrower or refunded by such Lender to the
Borrower, and (ii) in the event that the maturity of
any Note or other Obligation payable to any Lender is
accelerated or in the event of any required or
permitted prepayment, then such consideration that
constitutes interest under law applicable to any Lender
may never include more than the maximum amount allowed
by such applicable law and all interest in excess of
such lawful amount, if any, payable to any Lender under
this Agreement or otherwise shall be canceled
automatically as of the date of such acceleration or
prepayment and, if theretofore paid, shall, at the
option of any Lender be credited by such Lender on the
principal amount of the Obligations owed to such Lender
by the Borrower or refunded by such Lender to the
Borrower.
Section 2.14 Use of Proceeds.
The proceeds of all Advances made hereunder shall
be used by the Borrower (i) for its working capital and
general corporate purposes, including Acquisitions
permitted by this Agreement and (ii) to refinance
certain existing Debt of the Borrower on the Closing
Date.
ARTICLE III
-----------
YIELD PROTECTION, INTEREST RATE DETERMINATION, TAXES, ETC.
- ----------------------------------------------------------
Section 3.1 Additional Interest on Eurodollar
Rate Advances.
The Borrower shall pay to each Lender, so long as
such Lender shall be required under regulations of the
Federal Reserve Board to maintain reserves with respect
to liabilities or assets consisting of or including
Eurocurrency Liabilities, additional interest on the
unpaid principal amount of each Eurodollar Rate
Advance, from the date of such Advance until such
principal amount is paid in full, at an interest rate
per annum equal at all times to the remainder obtained
by subtracting (i) the Eurodollar Rate for each
Interest Period for such Eurodollar Rate Advance from
(ii) the rate obtained by dividing such Eurodollar Rate
by a percentage equal to 100% minus the Eurodollar Rate
Reserve Percentage of such Lender for such Interest
Period, payable on each date on which interest is
payable on such Eurodollar Rate Advance. Such
additional interest shall be determined by such Lender
and notified to the Borrower through the Administrative
Agent.
Section 3.2 Interest Rate Determination and
Protection.
(a) Each Reference Lender agrees to furnish
to the Administrative Agent timely information for
the purpose of determining each Eurodollar Rate.
If any one of the Reference Lenders shall not
furnish such timely information to the
Administrative Agent for the purpose of
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determining any such Eurodollar Rate, the
Administrative Agent shall determine such
Eurodollar Rate on the basis of timely information
furnished by the two remaining Reference Lenders.
(b) The Administrative Agent shall give
prompt notice to the Borrower and the Lenders of
the applicable interest rate determined by the
Administrative Agent for purposes of Section
2.9(a) or (b), and the applicable rate, if any,
furnished by each Reference Lender for the purpose
of determining the applicable interest rate under
Section 2.9(b).
(c) If more than one of the Reference
Lenders fails to furnish timely information to the
Administrative Agent for determining the
Eurodollar Rate for any Eurodollar Rate Advances,
(i) the Administrative Agent shall
forthwith notify the Borrower and the Lenders
that the interest rate cannot be determined
for such Eurodollar Rate Advances,
(ii) each outstanding Eurodollar
Rate Advance will automatically, on the last
day of the then-existing Interest Period
therefor, Convert into a Base Rate Advance,
and
(iii) the obligation of the
Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify
the Borrower and the Lenders that the
circumstances causing such suspension no
longer exist.
(d) If, with respect to any Eurodollar Rate
Advances, the Required Lenders notify the
Administrative Agent that the Eurodollar Rate for
any Interest Period for such Advances will not
equal or exceed the cost to such Required Lenders
of making, funding or maintaining their respective
Eurodollar Rate Advances for such Interest Period,
the Administrative Agent shall forthwith so notify
the Borrower and the Lenders, whereupon
(i) each Eurodollar Rate Advance
will automatically, on the last day of the
then-existing Interest Period therefor,
Convert into a Base Rate Advance, and
(ii) the obligation of the Lenders
to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify
the Borrower and the Lenders that the
circumstances causing such suspension no
longer exist.
(e) On the date on which the aggregate
unpaid principal amount of any Eurodollar Rate
Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to
less than $10,000,000, such Advances shall
automatically Convert into Base Rate Advances, and
thereafter, for purposes of prepayment pursuant to
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(147)
Section 2.6 and Conversion pursuant to Section
2.4, all outstanding Base Rate Advances shall be
deemed to be part of one Borrowing.
Section 3.3 Increased Costs.
(a) If, due to either (i) the introduction
of or any change (other than any change by way of
imposition or increase of reserve requirements
included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law
or regulation, in each case, after the Closing
Date, or (ii) the compliance with any guideline
or request from any Governmental Authority
(whether or not having the force of law) made
after the Closing Date, there shall be any
increase in the cost to any Lender of agreeing to
make or making, funding or maintaining Eurodollar
Rate Advances (except as otherwise provided in
Sections 3.1 and 3.5 hereof), then the Borrower
shall, within three days after demand by such
Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative
Agent for the account of such Lender additional
amounts sufficient to compensate such Lender for
such increased cost.
(b) If any Lender determines that compliance
with any law or regulation enacted or promulgated
after the Closing Date or any guideline or request
made after the Closing Date from any Governmental
Authority (whether or not having the force of law
and except as otherwise provided in Section 3.5
hereof) affects or would affect the amount of
capital required or expected to be maintained by
such Lender or any corporation controlling such
Lender and that the amount of such capital is
increased by or based upon the existence of such
Lender's commitment to lend hereunder and other
commitments of this type, then, upon demand by
such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay,
within three days after demand, to the
Administrative Agent for the account of such
Lender, from time to time as specified by such
Lender, additional amounts sufficient to
compensate such Lender or such corporation in the
light of such circumstances, to the extent that
such Lender reasonably determines such increase in
capital to be allocable to the existence of such
Lender's commitment to lend hereunder.
Section 3.4 Illegality.
Notwithstanding any other provision of this
Agreement, if any Lender shall notify the
Administrative Agent that the introduction of or any
change in or in the interpretation of any law or
regulation, in each case, after the Closing Date, makes
it unlawful, or any Governmental Authority asserts that
it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or to fund or maintain
Eurodollar Rate Advances hereunder, (i) the obligation
of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension
no longer exist and (ii) the Borrower shall forthwith
prepay in full all Eurodollar Rate Advances of all
Lenders then outstanding, together with interest
accrued thereon, unless the Borrower, within five
Business Days of notice from the Administrative Agent,
Converts all Eurodollar Rate Advances of all Lenders
then outstanding into Base Rate Advances in accordance
with Section 2.4.
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Section 3.5 Taxes.
(a) Any and all payments by the Borrower
hereunder or under the Notes shall be made, in
accordance with Section 2.11 free and clear of and
without deduction for any and all present or
future taxes, levies, imposts, deductions, charges
or withholdings, and all liabilities with respect
thereto, excluding in the case of each Lender and
the Administrative Agent, taxes imposed on or
measured by all or part of its net income, and
franchise taxes imposed on it, by the jurisdiction
under the laws of which such Lender or the
Administrative Agent (as the case may be) is
organized or any political subdivision thereof or,
in the case of each Lender, by the jurisdiction of
such Lender's Applicable Lending Office or any
political subdivision thereof (all such non-
excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable
hereunder or under any Note to any Lender or the
Administrative Agent, (i) the sum payable shall be
increased as may be necessary so that after making
all required deductions (including deductions
applicable to additional sums payable under this
Section 3.5) such Lender or the Administrative
Agent (as the case may be) receives an amount
equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall
make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant
taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Borrower agrees to pay
any present or future stamp, documentary or
intangibles taxes or any other similar taxes,
charges or levies which arise from any payment
made hereunder or under the Notes or from the
execution, delivery or registration of, or
otherwise with respect to, this Agreement, the
Notes or any of the other Loan Documents
(hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Lender
and the Administrative Agent for the full amount
of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this
Section 3.5) paid by such Lender or the
Administrative Agent (as the case may be) and any
liability (including penalties, interest and
expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes
were correctly or legally asserted. This
indemnification shall be made within thirty (30)
days from the date such Lender or the
Administrative Agent (as the case may be) makes
written demand therefor. The Administrative Agent
or any Lender claiming indemnification pursuant to
this Section 3.5(c) shall make written demand
therefor no later than one (1) year after the
earlier of (i) the date on which such Lender or
the Administrative Agent makes payment of such
Taxes or Other Taxes and (ii) the date on which
the appropriate Governmental Authority makes
written demand on such Lender or the
Administrative Agent for payment of such Taxes or
Other Taxes.
(d) If a Lender or the Administrative Agent
shall become entitled to claim a refund, credit or
reduction in respect of Taxes or Other Taxes as to
which it has been indemnified by the Borrower, or
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(149)
with respect to which the Borrower has made
payments pursuant to this Section 3.5, such Lender
or the Administrative Agent shall, within ninety
(90) days after receipt of a written request by
the Borrower and at Borrower's sole expense, make
an appropriate filing or claim with the
appropriate Governmental Authority to obtain or
use such refund, credit or reduction. Upon a
written request of the Borrower, each Lender or
the Administrative Agent shall use reasonable
efforts to cooperate with the Borrower in
determining whether or not the Administrative
Agent or such Lender is entitled to such a refund,
credit or reduction. If a Lender or the
Administrative Agent receives a refund or realizes
the benefit of a credit or reduction in respect of
any such Taxes or other Taxes (whether or not as a
result of a filing or claim made pursuant to the
first sentence of this paragraph), such Lender or
the Administrative Agent shall within ninety (90)
days from the date of such receipt or realization
pay over the amount of such refund, credit or
reduction to the Borrower (but only to the extent
of indemnity payments made or other amounts paid
by the Borrower under this Section 3.5 with
respect to such Taxes or Other Taxes), net of all
reasonable out-of-pocket expenses of such Lender
or the Administrative Agent and without interest
(other than interest paid by the relevant
Governmental Authority with respect to such
refund, credit or reduction); provided that the
Borrower (upon the written request of such Lender
or the Administrative Agent) agrees to repay the
amount paid over to the Borrower to such Lender or
the Administrative Agent (together with any
interest payable to the relevant Governmental
Authority) in the event such Lender or the
Administrative Agent is required to repay such
refund, credit or reduction to such Governmental
Authority.
(e) Within forty-five (45) days after the
date of any payment of Taxes by the Borrower, the
Borrower will furnish to the Administrative Agent,
at its address referred to in Section 11.1, the
original or a certified copy of a receipt (if any)
evidencing payment thereof.
(f) Each Lender that is a non-resident alien
or is organized under the laws of a jurisdiction
outside the United States, on or prior to the date
of its execution and delivery of this Agreement
(or, in the case of any Person becoming a Lender
after the Closing Date, on or prior to the
effective date of the Assignment and Acceptance
pursuant to which it becomes a Lender), from time
to time thereafter if requested in writing by the
Borrower, and upon any change in designation of
the Lender's Applicable Lending Office (but only
so long as such Lender remains lawfully able to do
so), shall provide each of the Borrower and the
Administrative Agent (i) if such Lender is not a
bank within the meaning of Section 881(c)(3)(A) of
the Code, a duly completed original U.S. Treasury
Department Form W-8 (or successor form) certifying
that such Lender is not a United States citizen or
resident (or that such Lender is filing for a
foreign corporation, partnership, estate or trust)
and providing the name and address of the Lender,
together with a certificate representing that it
is not a bank within the meaning of Section
881(c)(3)(A) of the Code and is not a ten percent
(10%) shareholder (within the meaning of Section
871(h)(3)(B) of the Code) with respect to the
Borrower, or (ii) if such Lender is a bank within
the meaning of Section 881(c)(3)(A) of the Code, a
duly completed original U.S. Treasury Department
Form W-8 BEN or Form W-8 ECI (or successor form),
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(150)
whichever is applicable, properly claiming
complete exemption from United States withholding
tax on payments by the Borrower pursuant to this
Agreement and under the Notes.
(g) The Borrower shall not be required to
indemnify any Lender or the Administrative Agent,
or to pay any other amount to any such Lender, in
respect of any Tax pursuant to this Section 3.5 to
the extent that: (i) in the case of a Lender that
is a non-resident alien or is organized under the
laws of a jurisdiction outside the United States,
the obligation to make such indemnification or to
pay such other amount would not have arisen but
for a failure by such non-resident Lender to
comply with the provisions of Section 3.5(f),
unless such failure is due to a change in law
occurring subsequent to the date on which a form
originally was required to be provided; provided,
however, that should a Lender be subject to
withholding Tax because of such failure, the
Borrower shall take such steps (at Lender's
expense) as the Lender shall reasonably request in
writing to assist the Lender to recover such Tax;
or (ii) such Tax was applicable on the date such
Lender or Administrative Agent became a party to
this Agreement or, with respect to payments to a
new Applicable Lending Office, the date such
Lender designated such Applicable Lending Office;
provided, however, that this clause (ii) shall not
apply to any Lender or new Applicable Lending
Office that becomes a Lender or Applicable Lending
Office as a result of an assignment or designation
made at the request of the Borrower, and provided
further that this clause (ii) shall not apply to
the extent the indemnity payment or other amount
any transferee Lender, or a Lender through a new
Applicable Lending Office, would be entitled to
receive does not exceed the indemnity payment or
other amount that the Lender making the
assignment, or making the designation of such new
Applicable Lending Office, would have been
entitled to receive in the absence of such
assignment or designation.
(h) Subject to Section 3.8, in the event
that a Lender that originally provided such form
as may be required under Section 3.5(f) thereafter
ceases to qualify for complete exemption from
United States withholding tax, such Lender may
assign its interest under this Agreement to any
Eligible Assignee in accordance with Section 11.5
and such Eligible Assignee shall be entitled to
the same benefits under this Section 3.5 as the
assignor provided that the rate of United States
withholding tax (and the rate of any Taxes or
Other Taxes) applicable to such Eligible Assignee
shall not exceed the rate then applicable to the
assignor.
Section 3.6 Funding Losses.
The Borrower agrees to reimburse each Lender and
to hold each Lender harmless from any loss or expense
(including loss of anticipated profits) which the
Lender may sustain or incur as a consequence of:
(a) the failure of the Borrower to borrow,
or to Continue or Convert to a Borrowing comprised
of Eurodollar Rate Advances after the Borrower has
given (or is deemed to have given) a Notice of
Borrowing or a Notice of Continuation/Conversion;
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(b) the failure of the Borrower to make any
prepayment after the Borrower has given a notice
in accordance with Section 2.6;
(c) the payment or prepayment (including
pursuant to Section 2.6) of a Borrowing comprised
of Eurodollar Rate Advances on a day which is not
the last day of the Interest Period with respect
thereto; or
(d) the Conversion of any Borrowing
comprised of Eurodollar Rate Advances to a
Borrowing comprised of Base Rate Advances on a day
that is not the last day of the respective
Interest Period;
including any such loss or expense arising from the
liquidation or reemployment of funds obtained by it to
maintain its Eurodollar Rate Advances hereunder or from
fees payable to terminate the deposits from which such
funds were obtained. Solely for purposes of
calculating amounts payable by the Borrower to the
Lenders under this Section 3.6 and under Section
3.3(a), each Eurodollar Rate Advance made by a Lender
(and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been
funded at the Eurodollar Rate used in determining the
rate of interest for such Eurodollar Rate Advance by a
matching deposit or other borrowing in the London
interbank market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate
Advance is in fact so funded.
Section 3.7 Certificates of Lenders.
(a) Any Lender claiming reimbursement or
compensation pursuant to this Article III shall
deliver to the Borrower (with a copy to the
Administrative Agent) a certificate setting forth
in reasonable detail the amount payable to such
Lender hereunder and such certificate shall be
prima facie evidence of the amount of compensation
due to such Lender in the absence of manifest
error.
(b) Prior to giving such certificate to the
Administrative Agent pursuant to Sections 3.1,
3.3, or 3.5, or notifying the Administrative Agent
pursuant to Section 3.4 that such Lender is unable
to make Eurodollar Advances, the affected Lender
shall designate a different Applicable Lending
Office if such designation would eliminate the
need to give such certificate or certification and
would not, in the judgment of such Lender, be
illegal or otherwise disadvantageous to such
Lender.
(c) Any Lender claiming reimbursement or
compensation pursuant to Section 3.3 shall deliver
the demand required by Section 3.3(a) or (b), as
applicable, in the form of the certificate
described in paragraph (a) no later than one (1)
year after such Lender obtains knowledge of such
additional cost, and if any Lender fails to give
notice to the Borrower within such period, the
Borrower shall have no obligation to pay any
amount accrued prior to the date which is one year
prior to delivery of such certificate.
Section 3.8 Replacement of a Lender.
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If the Borrower shall: (i) as a result of the
requirements of Sections 3.1, 3.3 or 3.5, be required
to pay any Lender the additional interest referred to
in such Section 3.1, the additional costs referred to
in such Section 3.3 or the Taxes or Other Taxes
referred to in such Section 3.5, which interests, costs
or taxes are not imposed by all of the other Lenders,
and the Borrower deems such additional amounts to be
material; (ii) as a result of the requirements of
Section 3.4, be required to prepay all Eurodollar Rate
Advances; or (iii) as a result of the failure of any
Lender to make available to the Administrative Agent
the amount of such Lenders Advance, be required to
repay to the Administrative Agent such corresponding
amount pursuant to Section 2.3(d) hereof, then, in each
case, the Borrower may obtain one or more other Lenders
or, with the consent of the Administrative Agent, one
or more other Eligible Assignees willing to replace
such Lender, and such Lender shall execute and deliver
to such Eligible Assignee an Assignment and Acceptance
with respect to such Lender's entire interest under
this Agreement and the Notes, and upon the execution by
such Eligible Assignee of such Assignment and
Acceptance and compliance with the requirements of
Section 11.5 hereof, such Eligible Assignee shall
succeed to all of such Lender's rights and duties under
this Agreement. If the Borrower exercises its election
under this Section 3.8 to replace a Lender, the
Borrower shall pay the administrative fee payable to
the Administrative Agent under Section 11.5 hereof.
Section 3.9 Survival.
The agreements and obligations of the Borrower in
this Article III shall survive the payment of all other
Obligations and the termination of this Agreement.
ARTICLE IV
-----------
CONDITIONS PRECEDENT
--------------------
Section 4.1 Conditions of Initial Borrowing.
The obligation of each Lender to make its initial
Advance hereunder is subject to the satisfaction, prior
to or simultaneously with the making of such Advance,
of the following conditions:
(a) This Agreement. The Administrative
Agent shall have received, on or before the
Closing Date, counterparts of this Agreement
executed by the Borrower, the Syndication Agent,
the Managing Agent and each of the Lenders in the
manner specified in Section 11.9 hereof, in
sufficient numbers so that each Lender shall
retain a counterpart thereof.
(b) Other Documents. The Administrative
Agent shall have received, on or before the
Closing Date, the following, each dated as of such
date, in form and substance satisfactory to the
Administrative Agent and in sufficient copies
(except for the Notes) for each Lender:
- -39-
(153)
(i) Notes. The Notes, payable to
the order of each of the Lenders, duly
executed by the Borrower;
(ii) Resolutions; Incumbency.
(A) copies of the
resolutions of the board of directors of
the Borrower approving and authorizing
the execution, delivery and performance
by the Borrower of this Agreement and
the other Loan Documents to be delivered
by the Borrower hereunder, and
authorizing the borrowings hereunder,
certified as of the Closing Date by the
secretary or an assistant secretary of
the Borrower; and
(B) a certificate of the
secretary or assistant secretary of the
Borrower certifying the names and true
signatures of the officers of the
Borrower authorized to execute, deliver
and perform, as applicable, this
Agreement and all other Loan Documents
to be delivered hereunder;
(iii) Articles of
Incorporation; By-Laws and Good Standing.
Each of the following documents:
(A) the articles or
certificate of incorporation of the
Borrower and of each Guarantor as in
effect on the Closing Date, certified by
the Secretary of State (or similar,
applicable Governmental Authority) of
the state of incorporation of the
Borrower and of each Guarantor as of a
recent date and by the secretary or
assistant secretary of the Borrower and
of such Guarantor as of the Closing
Date, and the bylaws of the Borrower and
of each Guarantor as in effect on the
Closing Date, certified by the secretary
or assistant secretary of the Borrower
and of such Guarantor as of the Closing
Date; and
(B) a good standing
certificate as of a recent date for the
Borrower and each Guarantor from the
Secretary of State (or similar,
applicable Governmental Authority) of
its state of incorporation and each
state where the Borrower or such
Guarantor is qualified to do business as
a foreign corporation;
(iv) Legal Opinions. A favorable
opinion of Hunton & Williams, counsel to the
Borrower and the Guarantors, addressed to the
Administrative Agent and the Lenders,
substantially in the form of Exhibit F
hereto;
(v) Certificate. A certificate
signed by the chief executive officer, chief
financial officer or treasurer of the
Borrower stating that:
- -40-
(154)
(A) the representations
and warranties contained in Article V
are true and correct on and as of such
date, as though made on and as of such
date;
(B) no Default or Event
of Default exists; and
(C) except as for
changes in the financial condition and
results of operations reflected in the
financial statements filed with the
Borrower's Form 10-Q for the third
quarter of 1999, since June 30, 1998, no
event or circumstance has occurred that
has resulted or could reasonably be
expected to result in a material adverse
change in, or a material adverse effect,
at such time or in the future, in or
upon the operations, business,
properties or condition (financial or
otherwise) of the Borrower and its
Subsidiaries taken as a whole; and
(vi) Other Documents. Such other
approvals, opinions, documents or materials
as the Administrative Agent, or the Required
Lenders through the Administrative Agent, may
request.
(c) Termination of Existing Credit
Agreement. Concurrently with the execution and
delivery of this Agreement, each of the lenders
(other than any Lender hereunder) which is party
to that certain Credit Agreement, dated as of June
27, 1997, by and among the Borrower, the Lenders
listed therein, the Administrative Agent, FUNB as
the Syndication Agent and Rabobank and Societe
Generale, as Co-Agents thereunder, as amended by
that certain Amendment No. 1 dated as of May 6,
1998, as amended by that certain Amendment No. 2
dated as of February 12, 1999 and as further
amended by that certain Amendment No. 3 dated as
of April 30, 1999 (as amended, the "Existing
Credit Agreement"), shall have received, or waived
in writing, timely notice of the termination of
such credit agreement as of the effective date of
this Agreement provided for in Section 11.9 and
all obligations (if any) thereunder shall have
been paid in full.
(d) Year 2000 Problem. The Administrative
Agent and the Lenders shall be satisfied that (i)
the Borrower and its Subsidiaries are taking all
necessary and appropriate steps to ascertain the
extent of, and to quantify and successfully
address, business and financial risks facing the
Borrower and its Subsidiaries as a result of what
is commonly referred to as the "Year 2000 Problem"
(i.e., the inability of certain computer
applications to recognize correctly and perform
date-sensitive functions involving certain dates
prior to and after December 31, 1999) and (ii) the
Borrower's and its Subsidiaries' material computer
applications will, on a timely basis, adequately
address the Year 2000 Problem in all material
respects.
(e) Payment of Fees. The Borrower shall
have paid to (i) the Administrative Agent, for
disbursement to the Lenders, such amounts as are
due and payable by the Borrower to the Lenders on
the Closing Date as agreed upon among the Borrower
and the Lenders, and (ii) the Administrative
Agent, for itself and for disbursement to BAS,
- -41-
(155)
such amounts as are payable to the Administrative
Agent and BAS on the Closing Date pursuant to the
Fee Letter.
Section 4.2 Conditions to All Borrowings.
The obligation of each Lender to make any Advance
to be made by it hereunder (including its initial
Advance) is subject to the satisfaction of the
following conditions precedent on the relevant
borrowing date:
(a) Notice of Borrowing. The Administrative
Agent shall have received a Notice of Borrowing
(with, in the case of the initial Borrowing only,
a copy for each Lender);
(b) Continuation of Representations and
Warranties. The representations and warranties
made by the Borrower contained in Article V shall
be true and correct on and as of the date of such
Borrowing, with the same effect as if made on and
as of the date of such Borrowing (except to the
extent such representations and warranties
expressly refer to an earlier date, in which case
they shall be true and correct as of such earlier
date);
(c) No Existing Default. No Default or
Event of Default shall exist or shall result from
such Borrowing; and
(d) Senior Indenture. At any time that the
aggregate principal amount of all outstanding
Borrowings shall exceed $240,000,000, the Borrower
shall have provided detailed calculations (in form
and substance reasonably satisfactory to the
Administrative Agent) evidencing compliance with
Section 4.11 of the Senior Indenture.
Each Notice of Borrowing submitted by the Borrower
hereunder shall constitute a representation and
warranty by the Borrower hereunder, as of the date of
each such notice and as of the date of each Borrowing,
that the conditions in Section 4.2 are satisfied.
ARTICLE V
---------
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the
Administrative Agent, the Syndication Agent, Managing
Agent and each of the Lenders that:
Section 5.1 Corporate Existence and Power.
Each of the Borrower and its Subsidiaries is a
corporation duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its
organization, and has all corporate powers and all
material governmental licenses, authorizations,
consents and approvals required to carry on its
business as now conducted. Each of the Borrower and
its Subsidiaries is duly qualified as a foreign
- -42-
(156)
corporation, licensed and in good standing in each
jurisdiction where qualification or licensing is
required by the nature of its respective business or
the character and location of its respective property,
business or customers and in which the failure so to
qualify or be licensed, as the case may be, in the
aggregate, could have a Material Adverse Effect.
Section 5.2 Corporate and Governmental
Authorization; Contravention.
The execution, delivery and performance by each of
the Borrower and the Guarantors of the Loan Documents
to which it is a party are within its corporate power,
have been duly authorized by all necessary corporate
action, require no action by or in respect of, or
filing with, any Governmental Authority and do not and
will not contravene, or constitute (with or without the
giving of notice or lapse of time or both) a default
under, any provision of applicable law as now in effect
or of the articles of incorporation or by-laws of the
Borrower or any Guarantor as now in effect or of any
material agreement, judgment, injunction, order, decree
or other instrument now binding upon or affecting the
Borrower or such Guarantor or result in the creation or
imposition of any Lien on any of their respective
assets.
Section 5.3 Binding Effect.
This Agreement and the Notes each constitutes a
valid and binding agreement of the Borrower and the
Subsidiary Guaranty constitutes a valid and binding
obligation of each of the Guarantors, in each case
enforceable against such Person in accordance with its
respective terms, except as (i) the enforceability
hereof and thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by
equitable principles of general applicability.
Section 5.4 Financial Information.
(a) The consolidated balance sheet of the
Borrower and its Subsidiaries as of June 30, 1998
and the related consolidated statements of income,
cash flows and stockholders' equity for the fiscal
year then ended, reported on by
PricewaterhouseCoopers LLP and set forth in the
Borrower's 1998 Form 10-K, a copy of which has
been delivered to each of the Lenders, fairly
present, in conformity with GAAP, the consolidated
financial position of the Borrower and its
Subsidiaries as of such date and the consolidated
results of operations and cash flows for such
fiscal year. The Borrower and its Subsidiaries
did not, as of June 30, 1998, have any material
contingent obligation, contingent liability or
liability for taxes, long-term lease or unusual
forward or long-term commitment, which is not
reflected in any of such financial statements or
notes thereto.
(b) The unaudited consolidated balance sheet
of the Borrower and its Subsidiaries as of March
31, 1999 and the related unaudited consolidated
statements of income, cash flows and stockholders'
equity for the nine months then ended, set forth
in the Borrower's Quarterly Report for the fiscal
quarter ended March 31, 1999 as filed with the
Securities and Exchange Commission on Form 10-Q, a
copy of which has been delivered to each of the
Lenders, fairly present, in conformity with GAAP
applied on a basis consistent with the financial
- -43-
(157)
statements referred to in paragraph (a), the
consolidated financial position of the Borrower
and its Subsidiaries as of such date and the
consolidated results of operations and cash flows
for such nine-month period (subject to normal year-
end adjustments).
(c) Except as for changes in the financial
condition and results of operations reflected in
the financial statements filed with the Borrower's
Form 10-Q for the third quarter of 1999, since
June 30, 1998, no event or circumstance has
occurred that has resulted or could reasonably be
expected to result in a Material Adverse Effect.
Section 5.5 Litigation.
Except as set forth on Schedule 5.5, (i) no
summons, complaint or other similar pleading has been
served on the Borrower or any of its Subsidiaries in
connection with any action, suit or proceeding, and
(ii) to the knowledge of the Borrower, there is no
action, suit or proceeding pending or threatened
against, or affecting, the Borrower or any of its
Subsidiaries, before any Governmental Authority, in the
case of clause (i) or (ii) in which there is a
reasonable possibility of an adverse decision which
could have a Material Adverse Effect or which in any
manner questions the validity of this Agreement, the
Notes or any Subsidiary Guaranty and there is no basis
known to the Borrower for any such action, suit or
proceeding.
Section 5.6 Marketable Title.
The Borrower and each of its Material Subsidiaries
has good and marketable title to all its material
properties and assets subject to no Lien, except
Permitted Liens.
Section 5.7 Filings.
All actions by or in respect of, and all filings
with, any Governmental Authority required in connection
with the execution, delivery and performance of this
Agreement, the Notes and the Subsidiary Guaranty, or
necessary for the validity or enforceability thereof or
for the protection of the rights and interests of the
Administrative Agent and each of the Lenders
thereunder, will, prior to the date of delivery
thereof, have been duly taken or made, as the case may
be, and will at all times thereafter remain in full
force and effect.
Section 5.8 Regulation U.
The proceeds of the Advances will be used by the
Borrower only for the purposes set forth in Section
2.14 hereof. None of the proceeds of any Advance will
be used, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock or for the
purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry Margin
Stock or for any other purpose which might constitute
the Advances a "purpose credit" within the meaning of
Regulations T, U and X issued by the Federal Reserve
Board.
- -44-
(158)
Section 5.9 Subsidiaries and Affiliates.
Schedule 5.9 sets forth a correct list of each
Subsidiary and Affiliate of the Borrower and the
percentage of ownership of the Borrower with respect to
each such entity. Such Schedule correctly identifies
all Material Subsidiaries.
Section 5.10 Solvency.
The Borrower and each of the Guarantors, if any,
is Solvent.
Section 5.11 ERISA Compliance.
(a) No Reportable Event has occurred and is
continuing with respect to any Plan; (b) the PBGC has
not instituted proceedings to terminate any Plan; (c)
neither the Borrower, any Subsidiary of the Borrower,
any ERISA Affiliate, nor any duly-appointed
administrator of a Plan (i) has incurred any liability
to the PBGC with respect to any Plan other than for
premiums not yet due or payable, or (ii) has instituted
or intends to institute proceedings to terminate any
Plan under Sections 4041 or 4041A of ERISA or withdraw
from any Multiemployer Plan; (d) no "accumulated
funding deficiency" (as defined in ERISA Section 302 or
Code Section 412) exists with respect to any Plan,
whether or not waived; (e) each "employee benefit plan"
(as defined in Section 3(3) of ERISA) maintained or
contributed to by or on behalf of the Borrower and its
Subsidiaries has been administered substantially and
funded in accordance with its terms and with all
provisions of the Code and ERISA applicable thereto;
and (f) the Borrower and its Subsidiaries have not
incurred any liability with respect to any welfare plan
(as defined in ERISA Section 3(1)) or for "welfare
benefits" (as defined in Code Section 419) that is not
reflected on the financial statements of the Borrower
and its Subsidiaries which would have a Material
Adverse Effect.
Section 5.12 Taxes.
The Borrower and each of its Subsidiaries have
filed all federal and other material tax returns and
reports required to be filed, and have paid all federal
and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or
their respective properties, income or assets otherwise
due and payable, except those which are being contested
in good faith by appropriate proceedings and for which
adequate reserves have been provided in accordance with
GAAP and, with the exception of the Brazilian Tax
Assessment, no notice of lien has been filed or
recorded with respect to the Borrower, any of its
Subsidiaries or any of their respective properties.
There is no proposed tax assessment against the
Borrower or any of its Subsidiaries which would, if the
assessment were made, have a Material Adverse Effect.
Section 5.13 Environmental Matters.
(a) The on-going operations of the Borrower
and each of its Subsidiaries comply in all
respects with all Environmental Laws, except such
non-compliance which would not (if enforced in
accordance with applicable law) result in
liability in excess of $2,000,000 in the
aggregate.
- -45-
(159)
(b) Except as specifically disclosed in
Schedule 5.13, the Borrower and each of its
Subsidiaries have obtained all licenses, permits,
authorizations and registrations required under
any Environmental Law ("Environmental Permits")
and necessary for their respective ordinary course
operations, no Governmental Authority responsible
for such Environmental Permits has threatened to
revoke, refuse to reissue or materially limit such
Environmental Permits, and the Borrower and each
of its Subsidiaries are in compliance with all
material terms and conditions of such
Environmental Permits.
(c) Except as specifically disclosed in
Schedule 5.13, none of the Borrower, any of its
Subsidiaries or any of their respective present
assets or operations, is subject to, any
outstanding written order from, or agreement with,
any Governmental Authority, nor subject to any
judicial or docketed administrative proceeding,
respecting any Environmental Law, Environmental
Claim or Hazardous Material.
(d) Except as specifically disclosed in
Schedule 5.13, there are no Hazardous Materials or
other conditions or circumstances existing with
respect to any assets, or arising from operations
prior to the Closing Date, of the Borrower, any of
its Subsidiaries or any of their respective
predecessors that would reasonably be expected to
give rise to Environmental Claims with a potential
liability to the Borrower and its Subsidiaries in
excess of $1,000,000 in the aggregate for any such
condition, circumstance or assets. In addition,
(i) to the knowledge of the Borrower, neither the
Borrower nor any of its Subsidiaries has any
underground storage tanks (x) that are not
properly registered or permitted under applicable
Environmental Laws, or (y) that are leaking or
disposing of Hazardous Materials, and (ii) to the
extent required by applicable Environmental Law,
the Borrower and its Subsidiaries have notified
all of their employees of the existence, if any,
of any health hazard arising from the conditions
of their employment and have met all material
notification requirements under all Environmental
Laws.
Section 5.14 Regulated Entities.
None of the Borrower, any Person controlling the
Borrower, or any Subsidiary of the Borrower, is (a) an
"Investment Company" within the meaning of the
Investment Company Act of 1940; or (b) subject to
regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act, the Interstate Commerce
Act, any state public utilities code, or any other
federal or state statute or regulation limiting its
ability to incur Debt.
Section 5.15 No Burdensome Restrictions.
Neither the Borrower nor any of its Subsidiaries
is a party to or bound by any contract or agreement, or
subject to any charter or corporate restriction, or any
Requirement of Law, which could reasonably be expected
to have a Material Adverse Effect.
Section 5.16 Labor Relations.
- -46-
(160)
There are no strikes, lockouts or other labor
disputes against the Borrower or any of its
Subsidiaries, or, to the best of the Borrower's
knowledge, threatened against or affecting the Borrower
or any of its Subsidiaries that reasonably could be
expected to have a Material Adverse Effect, and no
significant unfair labor practice complaint is pending
against the Borrower or any of its Subsidiaries or, to
the knowledge of the Borrower, threatened against any
of them before any Governmental Authority, if
determined adversely to the Borrower or any of its
Subsidiaries, that reasonably could be expected to have
a Material Adverse Effect.
Section 5.17 Copyrights, Patents, Trademarks and
Licenses, etc.
The Borrower or its Subsidiaries own or are
licensed or otherwise have the right to use all of the
patents, trademarks, service marks, trade names,
copyrights, contractual franchises, authorizations and
other rights that are reasonably necessary for the
operation of their respective businesses, without
conflict with the rights of any other Person. To the
knowledge of the Borrower, no slogan or other
advertising device, product, process, method,
substance, part or other material now employed, or now
contemplated to be employed, by the Borrower or any of
its Subsidiaries infringes upon any rights held by any
other Person; except as specifically disclosed in
Schedule 5.17, no claim or litigation regarding any of
the foregoing is pending or, to the knowledge of the
Borrower, threatened, and no patent, invention, device,
application, principle or any statute, law, rule,
regulation, standard or code is pending or, to the
knowledge of the Borrower, proposed, which, in either
case, could reasonably be expected to have a Material
Adverse Effect.
Section 5.18 Compliance With Laws.
The Borrower and each of its Subsidiaries are in
compliance with all applicable Requirements of Law
except where the failure to comply could not reasonably
be expected to have a Material Adverse Effect.
Section 5.19 Broker's Fees; Transaction Fees.
Neither the Borrower nor any of the its
Subsidiaries has any obligation to any Person in
respect of any finder's, broker's or investment
banker's fee in connection with the transactions
contemplated hereby, except as provided in the Fee
Letter.
Section 5.20 Full Disclosure.
All information heretofore furnished by any
Responsible Officer of the Borrower to the
Administrative Agent or any Lender for purposes of or
in connection with this Agreement or any transaction
contemplated hereby was, when furnished, and all such
information hereafter furnished by the Borrower to the
- -47-
(161)
Administrative Agent or any Lender will be, true,
accurate and complete in every material respect or
based on reasonable estimates on the date as of which
such information is stated or certified. None of such
information omits any material fact known by the
Borrower that is required to be stated therein or
necessary to make the statements made therein, in light
of the circumstances under which they are made, not
misleading as of the time when made or delivered. The
Borrower has disclosed to the Lenders in writing any
and all facts known by the Borrower that could have or
cause a Material Adverse Effect.
Section 5.21 Year 2000 Compliance.
The Borrower has (i) initiated a review and
assessment of all areas within its and each of its
Subsidiaries' businesses and operations (including
those affected by suppliers, vendors and customers)
that could be adversely affected by the "Year 2000
Problem" (that is, the risk that computer applications
may not be able to recognize and properly perform date-
sensitive functions after December 31, 1999), (ii)
developed a plan and timeline for addressing the Year
2000 Problem on a timely basis, and (iii) to date,
implemented that plan in accordance with that
timetable. Based on the foregoing, the Borrower
believes that all computer applications (including
those of its suppliers, vendors and customers) that are
material to its or any of its Subsidiaries' business
and operations are reasonably expected on a timely
basis to be able to perform properly date-sensitive
functions for all dates before and after January 1,
2000 (that is, be "Year 2000 Compliant"), except to the
extent that a failure to do so could not reasonably be
expected to have a Material Adverse Effect.
ARTICLE VI
----------
FINANCIAL COVENANTS
-------------------
The Borrower agrees that so long as any Advance or
any other Obligation shall remain unpaid or any Lender
shall have a Commitment hereunder, the Borrower shall,
unless the Required Lenders otherwise consent in
writing:
Section 6.1 Consolidated Working Capital.
Maintain Consolidated Working Capital, calculated
on the last day of each fiscal quarter, of not less
than $400,000,000.
Section 6.2 Minimum Consolidated Tangible Net
Worth.
Maintain Consolidated Tangible Net Worth,
calculated on the last day of each fiscal quarter
beginning on the date on which the Administrative Agent
first receives the officer's certificate to be
furnished by the Borrower pursuant to Section 7.1(c) of
this Agreement, greater than or equal to the "Minimum
Compliance Level". The "Minimum Compliance Level"
shall equal the sum of (a) $165,000,000 plus (b) upon
the conversion of any Subordinated Debt Securities into
stock of the Borrower, an amount equal to the aggregate
principal amount of Subordinated Debt Securities so
converted plus (c) as of the last day of each fiscal
year, from and including the fiscal year ending June
30, 1999, by an amount equal to 55% of Consolidated Net
Income (inclusive of extraordinary gains and without
reduction for extraordinary losses) for such fiscal
year. The foregoing increases in the Minimum
Compliance Level shall be cumulative, and no reduction
shall be made on account of any Consolidated Net Income
of less than zero for any fiscal year.
- -48-
(162)
Section 6.3 Consolidated Fixed Charge Coverage
Ratio.
Maintain a Consolidated Fixed Charge Coverage
Ratio, calculated on the last day of each fiscal
quarter of not less than the ratio set forth opposite
such date:
Calendar Year March 31 June 30 September 30 December 31
1999 1.10 to 1.00 1.10 to 1.00 1.10 to 1.00
2000 1.10 to 1.00 1.15 to 1.00 1.15 to 1.00 1.15 to 1.00
2001 1.15 to 1.00 1.20 to 1.00 1.20 to 1.00 1.20 to 1.00
thereafter 1.20 to 1.00
Section 6.4 Consolidated Leverage Ratio.
Maintain a Consolidated Leverage Ratio, calculated
on the last day of each fiscal quarter ending on the
dates set forth below, of not more than the ratio set
forth opposite such date:
Calendar Year March 31 June 30 September 30 December 31
1999 0.725 to 1.00 0.725 to 1.00 0.70 to 1.00
2000 0.70 to 1.00 0.675 to 1.00 0.675 to 1.00 0.65 to 1.00
thereafter 0.65 to 1.00
Section 6.5 Consolidated Total Senior Debt to
Borrowing Base Ratio.
Maintain a Consolidated Total Senior Debt to
Borrowing Base Ratio, calculated on the last day of
each fiscal quarter ending on the dates set forth
below, of not more than the ratio set forth opposite
such date:
Calendar Year March 31 June 30 September 30 December 31
1999 1.20 to 1.00 1.20 to 1.00 1.20 to 1.00
2000 1.10 to 1.00 1.10 to 1.00 1.10 to 1.00 1.10 to 1.00
thereafter 1.00 to 1.00
Section 6.6 Calculations.
For purposes of calculating the financial
covenants contained in Section 6.2 and Section 6.3 of
this Article VI, the Borrower shall be permitted to
exclude during the appropriate Calculation Periods the
effect of one-time restructuring and other asset
impairment charges incurred during the fiscal quarters
ending March 31, 1999 and June 30, 1999 in an aggregate
amount not to exceed $26,000,000.
- -49-
(163)
ARTICLE VII
-----------
AFFIRMATIVE COVENANTS
---------------------
The Borrower agrees that so long as any Advance or
any other Obligation shall remain unpaid or any Lender
shall have a Commitment hereunder, unless the Required
Lenders otherwise consent in writing:
Section 7.1 Information.
The Borrower shall deliver or cause to be
delivered to each of the Lenders:
(a) Annual Reports. (i) As soon as
available and in any event within 90 days
after the end of each fiscal year of the
Borrower, a consolidated balance sheet of the
Borrower and its Subsidiaries as of the end
of such fiscal year and the related
consolidated statement of cash flows and the
consolidated statements of income and
stockholders' equity for such fiscal year,
setting forth in each case in comparative
form the figures for the previous fiscal
year, all in reasonable detail and
accompanied by an opinion on such
consolidated statements by an Approved
Accounting Firm which opinion shall state
that such consolidated financial statements
present fairly the consolidated financial
position of the Borrower and its Subsidiaries
as of the date of such financial statements
and their consolidated results of their
operations and cash flows for the period
covered by such financial statements in
conformity with GAAP applied on a consistent
basis (except for changes in the application
of which such accountants concur) and shall
not contain any "going concern" or like
qualification or exception or qualifications
arising out of the scope of the consolidated
audit;
(ii) As soon as available and in any
event within 90 days after the end of each
fiscal year, a consolidated and consolidating
balance sheet of the Borrower and its
Subsidiaries and the related consolidated and
consolidating statements of income, cash
flows and stockholders' equity for such
fiscal year, setting forth (in the case of
consolidating statements) separate figures
for U.S. and non-US tobacco and flower
operations and fully consolidated operations
and (in the case of consolidated statements)
the consolidated figures in comparative form
for the Borrower's previous fiscal year, all
certified (subject to normal year-end audit
adjustments) as complete and correct in all
material respects by the Borrower's chief
financial officer, treasurer or chief
accounting officer;
(b) Quarterly Reports. As soon as available
and in any event within 45 days after the end of
each of the first three fiscal quarters, a
consolidated and consolidating balance sheet of
the Borrower and its Subsidiaries and the related
consolidated and consolidating statements of
income, cash flows and stockholders' equity for
the portion of the Borrower's fiscal year ended at
the end of such quarter, setting forth (in the
case of consolidating statements) separate figures
for U.S. and non-US tobacco and flower operations
- -50-
(164)
and fully consolidated operations and (in the case
of consolidated statements) the consolidated
figures in comparative form for the corresponding
portion of the Borrower's previous fiscal year,
all certified (subject to normal year-end audit
adjustments) as complete and correct in all
material respects by the Borrower's chief
financial officer, treasurer or chief accounting
officer;
(c) Officer's Certificates. Simultaneously
with the delivery of the financial statements
referred to in paragraphs (a) and (b) above, (i) a
certificate of the Borrower's chief financial
officer, treasurer or chief accounting officer (A)
setting forth in reasonable detail the
calculations required to establish whether the
Borrower was in compliance with the requirements
of Article VI and (B) stating that the Borrower
was in compliance with Sections 8.1, 8.2, 8.3 and
8.5, each on the date of such financial
statements; and (ii) a certificate of the
Borrower's chief financial officer, treasurer or
chief accounting officer (A) stating whether there
exists on the date of such certificate any Default
or Event of Default and, if any Default or Event
of Default then exists, setting forth the details
thereof and the action which the Borrower is
taking or proposes to take with respect thereto
and (B) stating whether, since the date of the
most recent previous delivery of financial
statements pursuant to paragraphs (a) or (b) of
this Section, any event has occurred that would
have a Material Adverse Effect and, if so, the
nature of such Material Adverse Effect;
(d) Borrowing Base Certificates. Within 45
days after the end of each fiscal quarter, a
certificate as of the end of the immediately
preceding fiscal quarter, substantially in the
form of Exhibit H and certified by a Responsible
Officer of the Borrower to be true and correct as
of the date thereof (a "Borrowing Base
Certificate").
(e) Accountant's Certificates.
Simultaneously with the delivery of each set of
financial statements referred to in paragraph (a)
above, a statement of the Approved Accounting Firm
that reported on such statements (i) stating that
their audit examination has included the reading
of this Agreement and the Notes as they relate to
financial or accounting matters, (ii) whether
anything has come to their attention to cause them
to believe that there existed on the date of such
statements any Default or Event of Default and
(iii) confirming the calculations set forth in the
officer's certificate delivered simultaneously
therewith pursuant to paragraph (c) above;
(f) Notice of Default. Forthwith upon the
occurrence of any Default or Event of Default,
notice of such Default or Event of Default in the
form of a certificate of the Borrower's chief
financial officer, treasurer or chief accounting
officer setting forth the details thereof and the
action which the Borrower is taking or proposes to
take with respect thereto;
(g) Notice of Litigation. Promptly upon, but
in no event later than fifteen (15) days after a
Responsible Officer becoming aware thereof,
written notice of the commencement of, or of a
material threat of the commencement of, an action,
suit or proceeding against the Borrower or any of
its Subsidiaries, whether or not the claim shall
be covered by insurance, which could have a
Material Adverse Effect or which in any manner
- -51-
(165)
questions the validity of this Agreement, the
Notes, the Subsidiary Guaranty or any of the other
transactions contemplated hereby or thereby, a
notice setting forth the nature of such pending or
threatened action, suit or proceeding and such
additional information as the Administrative
Agent, at the request of any Lender, may
reasonably request;
(h) Press Releases. Promptly upon issuance
thereof, copies of all press releases and other
statements made available generally by the
Borrower or its Material Subsidiaries to the
public concerning material developments in the
results of operations, financial condition,
business or prospects of the Borrower or its
Material Subsidiaries;
(i) Accountant's Reports. Promptly upon
receipt thereof, (x) each report submitted to the
Borrower by its Approved Accounting Firm
concerning its accounting practices and systems
and any final comment letter submitted by such
accountants to management in connection with the
annual audit of the Borrower by its Approved
Accounting Firm and (y) copies of each report
material to the financial condition or operations
of the Borrower submitted to a Responsible Officer
of the Borrower or any of its Material
Subsidiaries by independent public accountants in
connection with any annual, interim or special
audit made by them of the books of the Borrower or
any of its Material Subsidiaries;
(j) Shareholder Communications. Promptly
upon the mailing thereof to the Borrower's
shareholders, copies of all financial statements,
reports and proxy statements so mailed;
(k) SEC Filings. Promptly upon the filing
thereof, copies of all registration statements
(other than the exhibits thereto and any
registration statements on Form S-8 or its
equivalent) and annual, quarterly or periodic
reports which the Borrower shall have filed with
the Securities and Exchange Commission;
(l) Schedule Update. From time to time such
information as is necessary so that each of
Schedule 5.9, Schedule 5.13 and Schedule 5.17 is
accurate and complete;
(m) Additional Information. From time to
time such additional information regarding the
financial position, results of operations or
business of the Borrower or any Material
Subsidiary as the Administrative Agent, at the
request of any Lender, may reasonably request;
(n) Notices to Holders of Senior Debt
Securities. Simultaneously with delivery thereof,
copies of all written notices as the Borrower
shall send to the holders of the Senior Debt
Securities;
(o) Environmental Matters. Promptly upon,
but in no event later than fifteen (15) days after
a Responsible Officer becoming aware thereof,
written notice of (i) any and all enforcement,
cleanup, removal or other governmental or
regulatory actions instituted, completed or
threatened against the Borrower or any of its
Subsidiaries or any of their respective properties
- -52-
(166)
pursuant to any applicable Environmental Laws,
(ii) all other Environmental Claims, and (iii) any
environmental or similar condition on any real
property adjoining or in the vicinity of the
property of the Borrower or any Subsidiary that
could reasonably be anticipated to cause such
property or any part thereof to be subject to any
restrictions on the ownership, occupancy,
transferability or use of such property under any
Environmental Laws;
(p) ERISA. Promptly and in any event within
fifteen (15) days after
(i) a Responsible Officer or any
ERISA Affiliate knows or has reason to know
that any ERISA Event has occurred, a
statement of the chief executive officer,
chief financial officer or treasurer of the
Borrower describing such ERISA Event and the
action, if any, which the Borrower or such
ERISA Affiliate proposes to take with respect
thereto;
(ii) receipt thereof by the
Borrower or any ERISA Affiliate, copies of
each notice from the PBGC stating its
intention to terminate any Plan or to have a
trustee appointed to administer any Plan;
(iii) receipt thereof by the
Borrower or any ERISA Affiliate from the
sponsor of a Multiemployer Plan, a copy of
each notice received by the Borrower or any
ERISA Affiliate concerning (x) the imposition
of withdrawal liability by a Multiemployer
Plan, or (y) the reorganization or
termination, within the meaning of Title IV
of ERISA, of any Multiemployer Plan and such
notice shall include the estimated amount of
withdrawal liability incurred or which may be
incurred by the Borrower or any ERISA
Affiliate in connection with such event
described in clause (x) or (y) above; and
(q) Rating Change. Promptly upon receipt of
notice thereof by a Responsible Officer, a written
notice of the issuance of any rating of, or any
change in the rating of, the Borrower's senior
unsecured debt affecting the calculation of the
Applicable Margin or of the commitment fees due
pursuant to Section 2.10 hereof or any other
issuance or change in the public rating of any
other obligations of the Borrower or any of its
Material Subsidiaries.
Section 7.2 Payment of Obligations.
The Borrower and each of its Material Subsidiaries
shall pay and discharge, as the same shall become due
and payable, (i) all of their respective obligations
and liabilities in an amount exceeding $500,000,
including all claims or demands of materialmen,
mechanics, carriers, warehousemen, landlords and other
like Persons which, in any such case, if unpaid, might
by law give rise to a Lien upon any of their properties
or assets, and (ii) all lawful taxes, assessments and
charges or levies made upon their properties or assets
by any Government, except where any of the items in
clause (i) or (ii) of this Section 7.2 may be
diligently contested in good faith by appropriate
- -53-
(167)
proceedings, and the Borrower or such Subsidiary shall
have set aside on its books, if required under GAAP,
appropriate reserves for the accrual of any such items.
Section 7.3 Maintenance of Property; Insurance.
The Borrower and each of its Material
Subsidiaries shall keep all property useful and
necessary in their respective businesses in good
working order and condition, subject to ordinary wear
and tear, shall maintain (either in the Borrower's name
or in such Material Subsidiary's own name) with
financially sound and reputable insurance companies,
insurance on all their respective properties in at
least such amounts and against at least such risks (and
with such risk retentions) as are usually insured
against by companies engaged in the same or a similar
business in similar locations and shall furnish to the
Administrative Agent upon request by the Administrative
Agent or the Required Lenders full information as to
the insurance carried.
Section 7.4 Conduct of Business and Maintenance
of Existence.
The Borrower and, subject to the provisions of
Section 8.4, each of its Material Subsidiaries shall
continue to engage in business of the same general type
as now conducted by the Borrower or such Material
Subsidiary. The Borrower shall, and, subject to Section
8.4, shall cause each Material Subsidiary to, take all
reasonable action to preserve, renew and keep in full
force and effect its respective corporate existence and
its respective rights, privileges and franchises to the
extent such rights, privileges and franchises remain
material to the normal conduct of its business.
Section 7.5 Compliance with Laws.
The Borrower and each Subsidiary shall comply in
all material respects with all Requirements of Law
(including, without limitation, ERISA and the rules and
regulations thereunder and Environmental Laws), except
where the necessity of compliance therewith is
contested in good faith by appropriate proceedings or
non-compliance could not be reasonably expected to have
a Material Adverse Effect.
Section 7.6 Accounting; Inspection of Property,
Books and Records.
The Borrower and each Subsidiary shall keep proper
books of records and accounts in which full, true and
correct entries in conformity with GAAP shall be made
of all dealings and transactions in relation to their
respective businesses and activities; the Borrower
shall maintain its fiscal reporting period on a June 30
fiscal year, and each Subsidiary (other than a Foreign
Subsidiary) shall maintain its respective fiscal
reporting period on the present basis; and the
Borrower shall permit, and shall cause each Subsidiary
to permit, upon three (3) days, prior written notice to
the Borrower, representatives of any Lender to visit
and inspect any of their respective properties, to
examine and make abstracts from any of their respective
books and records and to discuss their respective
affairs, finances and accounts with their officers,
employees and independent public accountants, all at
such reasonable times and as often as may reasonably be
desired; provided that no such notice shall be required
if a Default or Event of Default has occurred and is
continuing.
- -54-
(168)
Section 7.7 Additional Guarantors.
(a) In the event that any Subsidiary of the
Borrower or any other Person becomes a Material
Domestic Subsidiary after the Closing Date,
whether pursuant to an acquisition, merger or
transfer of assets permitted or consented to by
the Required Lenders under Section 8.4 hereof,
through internal growth or otherwise, the Borrower
shall, at the request of the Administrative Agent,
cause each such Material Domestic Subsidiary to
become a party to the Subsidiary Guaranty, and to
deliver all relevant documentation with respect
thereto of the types described in Section 4.1(b)
with respect to such Subsidiary.
(b) At such time as the value of the total
assets (as determined in accordance with GAAP) of
all Domestic Subsidiaries (other than Material
Domestic Subsidiaries) exceeds 20% of Consolidated
Total Assets, the Borrower shall, at the request
of the Administrative Agent, cause each such
Domestic Subsidiary to become a party to the
Subsidiary Guaranty, and to deliver all relevant
documentation with respect thereto of the types
described in Section 4.1(b) with respect to such
Subsidiary.
Section 7.8 ERISA.
The Borrower shall make, and cause each of its
Subsidiaries and ERISA Affiliates to make, prompt
payments of contributions required by the terms of each
plan and to meet the minimum funding standards
applicable thereto.
Section 7.9 Year 2000 Compliance.
The Borrower will promptly notify the
Administrative Agent in the event it discovers or
determines that any computer application (including
those of its suppliers, vendors and customers) that is
material to its or any of its Subsidiaries' business
and operations will not be Year 2000 Compliant, except
to the extent that such failure could not reasonably be
expected to have a Material Adverse Effect
ARTICLE VIII
------------
NEGATIVE COVENANTS
------------------
The Borrower agrees that so long as any Advance or
any other Obligation shall remain unpaid or any Lender
shall have a Commitment hereunder, unless the Required
Lenders otherwise consent in writing:
Section 8.1 Restriction on Liens.
- -55-
(169)
The Borrower shall not, and shall not permit any
Material Subsidiary to, create, assume or suffer to
exist any Lien on any property or asset now owned or
hereafter acquired by the Borrower or such Material
Subsidiary or assign or otherwise subordinate any
present right, or subordinate any future right
subsequent to the acquisition thereof, to receive
assets, except:
(a) Liens existing on the Closing Date and
set forth on Schedule 8.1, which Liens secure Debt
outstanding on the Closing Date in an aggregate
principal amount not exceeding $50,000,000;
(b) purchase money Liens on any capital
asset of the Borrower or a Material Subsidiary if
such purchase money Lien attaches to such capital
asset concurrently with the acquisition thereof
and if the Debt secured thereby does not exceed
the lesser of the cost or fair market value as of
the time of acquisition of the asset covered
thereby by the Borrower or such Material
Subsidiary; provided, that the aggregate amount of
debt (excluding any Debt permitted under clause
(a) above), secured by all such Liens does not
exceed $15,000,000 in the aggregate at any one
time outstanding; and provided further, that no
such Lien shall extend to or cover any property or
asset of the Borrower or such Material Subsidiary
other than the related property or asset
(including accessions thereto and proceeds
thereof, to the extent provided in the security
agreement creating such Lien);
(c) Liens not securing Debt which are
incurred in the ordinary course of business in
connection with workers' compensation,
unemployment insurance, old-age pensions, social
security and public liability laws and similar
legislation;
(d) Liens securing the performance of bids,
tenders, leases, contracts (other than for the
repayment of Debt), statutory obligations, and
other obligations of like nature, incurred as an
incident to and in the ordinary course of
business;
(e) Liens securing taxes, assessments or
charges or levies of any Governmental Authority or
the claims of growers, materialmen, mechanics,
carriers, warehousemen, landlords and other like
Persons; provided, that (i) with respect to Liens
securing taxes, such taxes are not yet due and
payable, (ii) with respect to Liens securing
claims or demands of growers, materialmen,
mechanics, carriers, warehousemen, landlords and
the like, such Liens are inchoate and unfiled and
no other action has been taken to enforce the same
and (iii) with respect to taxes, assessments or
charges or levies of any Governmental Authority
secured by such Liens, payment thereof is not at
the time required by Section 7.2;
(f) zoning restrictions, easements,
licenses, reservations, covenants, conditions,
waivers, restrictions on the use of property or
other minor encumbrances or irregularities of
title which do not materially impair the use of
any material property in the operation of the
business of the Borrower or any Material
Subsidiary or the value of such property for the
purpose of such businesses or which are being
contested in good faith by appropriate
proceedings;
- -56-
(170)
(g) attachment, judgment or similar Liens
arising in connection with court proceedings and
the Brazilian Tax Assessment; provided, that the
execution or other enforcement of such Liens is
effectively stayed, the claims secured thereby are
being actively contested in good faith by
appropriate proceedings and the Borrower or such
Material Subsidiary shall have set aside on its
books, if required by GAAP, appropriate reserves
for such Liens;
(h) any Lien existing on any asset of any
Person at the time such Person becomes a Material
Subsidiary and not created in contemplation of
such event;
(i) any Lien on any asset of any Person
existing at the time such Person is merged or
consolidated with or into the Borrower or a
Material Subsidiary and not created in
contemplation of such event;
(j) any Lien existing on any asset prior to
the acquisition thereof by the Borrower or a
Material Subsidiary and not created in
contemplation of such event;
(k) Liens given to secure Debt owing to life
insurance companies (or affiliates thereof)
issuing life insurance policies in connection with
Split-Dollar Programs, incurred to finance non-
scheduled premiums paid by the Borrower or its
Subsidiaries under such policies pursuant to
Split-Dollar Agreements executed in connection
with the Split-Dollar Program which Debt does not
exceed $10,000,000 in the aggregate, provided that
in connection with any Split-Dollar Program such
Liens shall be limited to the Borrower's right,
title and interest in and to (i) the Split-Dollar
Agreement and the Split-Dollar Assignment executed
in connection with such Split-Dollar Program and
(ii) the policy of life insurance assigned to the
Borrower as collateral pursuant to such
Split-Dollar Assignment;
(l) any Lien arising out of the refinancing,
extension, renewal or refunding of any Debt
secured by any Lien permitted by any of the
foregoing paragraphs of this Section 8.1;
provided, that the principal amount of such Debt
is not increased and such Debt is not secured by
any additional assets; and
(m) Liens not otherwise permitted by the
foregoing paragraphs of this Section 8.1 securing
Debt in an aggregate principal amount at any time
outstanding not to exceed $500,000.
Section 8.2 Debt.
(a) The Borrower shall not create, assume or
suffer to exist any Debt (i) that is secured by
any Lien that is not permitted by Section 8.1 or
(ii) in the case of any Debt for borrowed money
incurred or assumed after the Closing Date, if on
the date of incurrence or assumption of such Debt
after giving effect on a Pro Forma Basis to the
incurrence or assumption of such Debt and to the
concurrent retirement of any other Debt of the
Borrower or any of its Subsidiaries, a Default or
Event of Default would exist hereunder; provided,
- -57-
(171)
however, that the Borrower may renew, refinance or
extend any Debt originally permitted to be
incurred pursuant to this paragraph (a) so long as
such renewed, refinanced or extended Debt is on
terms and conditions no less favorable to the
Borrower than the Debt originally issued
(including, without limitation, any shortening of
the final maturity or average life to maturity or
requiring any payment to be made sooner than
originally scheduled or any increase in the
interest rate applicable thereto or any change to
any subordination provision thereof).
(b) The Borrower shall not permit any
Subsidiary to create, assume or suffer to exist
any Debt other than (i) purchase money Debt to the
extent secured by Liens permitted by Section 8.1
and (ii) additional Debt, including Debt arising
under any Guarantee permitted by Section 8.3,
which in the aggregate does not exceed (x)
$60,000,000 for Domestic Subsidiaries, and (y)
$600,000,000 for Foreign Subsidiaries; provided,
however, that this Section 8.2(b) shall not permit
the incurrence or assumption of any Debt if on the
date of incurrence or assumption of such Debt
after giving effect on a Pro Forma Basis to the
incurrence or assumption of such Debt and to the
concurrent retirement of any other Debt of the
Borrower or any of its Subsidiaries, a Default or
Event of Default would exist hereunder.
Section 8.3 Guarantees.
The Borrower shall not, and shall not permit any
Subsidiary to, create, assume or suffer to exist any
Guarantee, other than (i) Guarantees which are incurred
in the ordinary course of business for the purpose of
carrying unsold tobacco inventories held against
Confirmed Orders, (ii) other Guarantees incurred in the
ordinary course of business so long as the aggregate
outstanding amount of all obligations Guaranteed under
this clause (ii) does not at any time exceed
$200,000,000, (iii) Guarantees of the Guarantors
pursuant to the Subsidiary Guaranty and (iv) Guarantees
of the Guarantors of the Borrower's obligations under
the Senior Indenture and the Senior Debt Securities.
Section 8.4 Consolidations, Mergers and Sale of
Assets.
The Borrower shall not, and shall not permit any
Material Subsidiary to, consolidate or merge with or
into any other Person or sell, lease or otherwise
transfer all or any substantial part of its assets to
any other Person, except that:
(a) the Borrower may merge with another
Person if (i) the Borrower is the corporation
surviving such merger and (ii) immediately after
giving effect to such merger on a Pro Forma Basis,
no Default or Event of Default shall have occurred
and be continuing;
(b) any Material Subsidiary may merge with
or into, or sell, lease or otherwise transfer all
or any substantial part of its assets to the
Borrower or to a Material Domestic Subsidiary
(determined immediately thereafter) if, in
connection with any such merger (i) either the
Borrower or such Material Domestic Subsidiary is
- -58-
(172)
the surviving corporation and (ii) immediately
after giving effect to such merger, sale, lease or
other transfer on a Pro Forma Basis, no Default or
Event of Default shall have occurred and be
continuing;
(c) any Material Foreign Subsidiary may
merge into or sell, lease or otherwise transfer
all or substantially all of its assets to any
other Foreign Subsidiary in which the Borrower,
directly or indirectly, shall retain a
proportionate equity interest equal to or greater
than the equity interest of the Borrower in the
merging Subsidiary if immediately after giving
effect to such merger, sale, lease or other
transfer on a Pro Forma Basis, no Default or Event
of Default shall have occurred and be continuing;
(d) any Material Subsidiary may merge with
another Person in connection with an Acquisition
permitted by Section 8.5 if (i) such Material
Subsidiary is the surviving corporation and (ii)
following such Acquisition, the Borrower shall
retain, directly or indirectly, a proportionate
equity interest in such Material Subsidiary equal
to or greater than the Borrower's equity interest
immediately prior to such Acquisition;
(e) the Borrower may complete the orderly
liquidation of its interests in Korean American
Tobacco Company; and
(f) the Borrower or any Material Subsidiary
may transfer its interests in any Foreign
Subsidiary to one or more Wholly Owned
Subsidiaries of the Borrower or such Material
Subsidiary.
Section 8.5 Acquisitions and Investments.
The Borrower shall not, and shall not permit any
Subsidiary to, directly or indirectly, make any
Acquisition or Investment, or enter into any agreement
to make any Acquisition or Investment, except for:
(a) In addition to any Investments otherwise
permitted by this Section 8.5, any Acquisition
(other than a Hostile Acquisition) or Investment
for consideration consisting of cash or cash
equivalents, common stock of the Borrower (valued
at the market value thereof as of the date of the
issuance thereof), other securities or properties
of the Borrower or any Subsidiary (valued in good
faith by the Board of Directors of the Borrower),
the assumption of any Debt (valued at the
principal amount thereof), any other consideration
(valued in good faith by the board of directors of
the Borrower) or any combination of the foregoing;
provided that the aggregate value of all such
consideration for all Acquisitions and Investments
of the Borrower and its Subsidiaries made during
any fiscal year shall not exceed 10% of
Consolidated Tangible Net Worth as of the most
recent fiscal year end with respect to which the
Administrative Agent and the Lenders shall have
received the financial statements referred to in
Section 7.1(a)(i); provided further that in the
case of any Acquisition involving an aggregate
purchase price (including cash and non-cash
consideration) in excess of $10,000,000, the
Borrower shall have delivered to the
Administrative Agent a certificate of the
- -59-
(173)
Borrower's chief financial officer, treasurer or
chief accounting officer containing calculations
that demonstrate that after giving effect to such
Acquisition on a Pro Forma Basis, the Borrower is
in compliance with the financial covenants set
forth in Article VI.
(b) Investments in direct obligations of, or
obligations Guaranteed as to principal and
interest by, the United States government or any
agency or instrumentality thereof maturing in one
year or less from the date of acquisition thereof;
(c) Investments in deposits in (including
money market funds of), or certificates of
deposits or bankers' acceptances of, (i) any bank
or trust company organized under the laws of the
United States or any state thereof having capital
and surplus in excess of $100,000,000, (ii) any
international bank organized under the laws of any
country which is a member of the OECD or a
political subdivision of any such country, and
having a combined capital and surplus of at least
$100,000,000, or (iii) leading banks in a country
where the Borrower or the Subsidiary making such
Investment does business; provided, that all such
Investments mature within 270 days of the date of
such Investment; and provided, further, that all
Investments pursuant to clause (iii) above are (A)
solely of funds generated in the ordinary course
of business by operations of Foreign Subsidiaries
in the country where such Investment is made, and
(B) denominated in the currency of the country in
which such Investment is made or in Dollars;
(d) Investments in commercial paper maturing
within 270 days and having one of the two highest
ratings of either Standard & Poor's Corporation,
Moody's Investors Service, Inc. or Fitch
Investors' Service, Inc.;
(e) Investments in money market funds (other
than those referred to in paragraph (c) above)
that have assets in excess of $2,000,000,000, are
managed by recognized and responsible institutions
and invest solely in obligations of the types
referred to in paragraphs (b) (c)(i) and (ii) and
(d) above;
(f) Investments in Persons evidencing the
deferred purchase price receivable of assets sold,
leased or otherwise transferred in accordance with
Section 8.4;
(g) Investments in the Borrower and any
Material Domestic Subsidiary (determined
immediately after such Investment);
(h) loans and advances in the ordinary
course of its business to officers and employees
of the Borrower or any Subsidiary of the Borrower
in an aggregate outstanding principal amount not
to exceed $3,000,000;
(i) loans and advances to growers and other
suppliers of tobacco (including Affiliates) in the
ordinary course of its business in an aggregate
outstanding principal amount consistent with past
practice of the Borrower;
(j) Guarantees permitted by Sections 8.2 and
8.3;
- -60-
(174)
(k) Investments in (i) direct noncallable
obligations of, or obligations Guaranteed as to
principal and interest by the United States
government or any agency or instrumentality
thereof, without regard to the maturity of such
obligations, and (ii) depository receipts issued
by a bank (as defined in Section 3(a)(2) of the
Securities Act of 1933) as custodian with respect
to any obligation of the United States government
referred to in clause (i) above and held by such
bank for the account of the holder of such
depository receipt, or with respect to any
specific payment of principal or interest on any
obligation of the United States government which
is so specified and held, provided that (except as
required by law) such custodian is not authorized
to make any deduction from the amount payable to
the holder of such depository receipts from any
amount received by the custodian in respect of the
United States government obligations or the
specific payment of principal or interest of the
United States government obligations evidenced by
such depository receipts, where the sole purpose
of such Investments is either the Legal Defeasance
or the Covenant Defeasance of the outstanding
Senior Debt Securities, as provided in the Senior
Indenture;
(l) Investments made by any Foreign
Subsidiary in the ordinary course of such Person's
business, in connection with the financing of
international trading transactions, in export
notes, trade credit assignments, bankers'
acceptances guarantees and instruments of a
similar nature issued by (i) any commercial bank
or trust company (or any Affiliate thereof)
organized under the laws of the United States or
any state having capital and surplus in excess of
$100,000,000 or (ii) any international bank
organized under the laws of any country which is a
member of the OECD or a political subdivision of
any such country, and having a combined capital
and surplus of at least $100,000,000;
(m) Investments by the Borrower in the
Senior Debt Securities in connection with any
purchase of the Senior Debt Securities by the
Borrower, as required or permitted by the Senior
Indenture, and otherwise permitted under this
Agreement;
(n) Investments by the Borrower in the
Subordinated Debt Securities in connection with
any conversion or purchase of the Subordinated
Debt Securities by the Borrower, as required or
permitted by the Subordinated Indenture, and
otherwise permitted under this Agreement; provided
that the Borrower shall make no such Investment
(other than a conversion of the Subordinated Debt
Securities into stock of the Borrower) unless
immediately after giving effect thereto on a Pro
Forma Basis, no Default or Event of Default shall
have occurred and be continuing;
(o) Transfers of interests in Foreign
Subsidiaries to the extent permitted under Section
8.4(f); and
(p) Investments by a Foreign Subsidiary in
any other Foreign Subsidiary.
Section 8.6 Transactions with Other Persons.
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(175)
The Borrower shall not enter into any agreement
with any Person whereby the Borrower shall agree to any
restriction on the Borrower's right to amend or waive
any of the provisions of this Agreement.
Section 8.7 Transactions with Affiliates.
The Borrower shall not, and shall not permit any
Material Subsidiary to, enter into any transaction with
any Affiliate of the Borrower or any such Material
Subsidiary, except (a) as expressly permitted by this
Agreement, or (b) in the ordinary course of business
and pursuant to the reasonable requirements of the
business of the Borrower or such Material Subsidiary,
provided that such transaction is upon fair and
reasonable terms no less favorable to the Borrower or
such Material Subsidiary than would obtain in a
comparable arm's-length transaction with a Person not
an Affiliate of the Borrower or such Material
Subsidiary.
Section 8.8 Compliance with ERISA.
The Borrower shall not, and shall not permit any
Subsidiary or any ERISA Affiliate to, (a) terminate any
Plan or withdraw from any Multiemployer Plan so as to
result in any liability to the Borrower or any of its
Subsidiaries in excess of $2,500,000, either singly or
in the aggregate, (b) enter into any "prohibited
transaction" (as defined in Section 4975 of the Code
and in Section 406 of ERISA) which results in any
liability to the Borrower or any of its Subsidiaries in
excess of $2,500,000, either singly or in the
aggregate, (c) cause any occurrence of any Reportable
Event which results in any, liability to the Borrower
or any of its Subsidiaries in excess of $2,500,000,
either singly or in the aggregate, or (d) allow or
suffer to exist any other event or condition known to
the Borrower or any of its Subsidiaries which results
in any liability to the Borrower or any of its
Subsidiaries in excess of $2,500,000, either singly or
in the aggregate, with respect to an "employee benefit
plan" (as defined in Section 3(3) of ERISA), including
a Plan.
Section 8.9 Change in Structure.
Except as expressly permitted by this Agreement,
the Borrower shall not, and shall not permit any
Material Subsidiary to, make any changes in its equity
capital structure (including in the terms of its
outstanding stock) that would reduce or impair the
consolidated equity capital of the Borrower and its
Material Subsidiaries immediately thereafter, or amend
its certificate of incorporation or by-laws in any
respect which is adverse to the interests of the
Lenders, provided that, nothing herein shall limit or
impair the right or ability of the Borrower or any of
its Subsidiaries to issue stock.
Section 8.10 Restrictions on Negative Pledges.
The Borrower shall not, and shall not permit any
Material Subsidiary to, enter into any indenture,
agreement, instrument or other arrangement (other than
the Senior Indenture) that (or modify any indenture,
agreement, instrument or other arrangement such that
it), directly or indirectly, prohibits or restrains, or
has the effect of prohibiting or restraining, or
imposes materially adverse conditions upon, the
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(176)
granting of Liens by the Borrower or any Material
Subsidiary of the Borrower to the Administrative Agent
for the benefit of the Lenders.
Section 8.11 Limitation on Dividend
Restrictions.
The Borrower shall not, and shall not permit any
Subsidiary to, enter into any agreement or otherwise
become subject to any arrangement (except as may be
required or imposed by any Requirement of Law in the
case of a Foreign Subsidiary) which restricts or
prohibits, in any manner whatsoever, the payment of
dividends or any similar distribution from any
Subsidiary to the Borrower or between or among the
Subsidiaries.
Section 8.12 Payments of Subordinated Debt
Securities.
If any Default or Event of Default has occurred
and is continuing or would be directly or indirectly
caused as a result thereof, the Borrower shall not, and
shall not permit any Subsidiary to, make (or give any
notice with respect thereto) any payment or prepayment
or redemption or acquisition for value of (including
without limitation, by way of depositing money or
securities with the trustee with respect thereto before
due for the purpose of paying when due), refund,
refinance or exchange of any Indebtedness (including
interest and fees) arising under the Subordinated
Indenture and the Subordinated Debt Securities;
provided that the Borrower shall at all times be
permitted to convert the Subordinated Debt Securities
into stock of the Borrower as required or permitted by
the Subordinated Indenture, and otherwise permitted
under this Agreement.
Section 8.13 Maximum Uncommitted Inventories.
The Borrower shall not permit the Uncommitted
Inventories to exceed $175,000,000.
ARTICLE IX
----------
EVENTS OF DEFAULT
-----------------
Section 9.1 Events of Default.
Any one or more of the following events shall
constitute an event of default hereunder ("Events of
Default"):
(a) Non-Payment. The Borrower shall fail to
pay (i) when due, any amount of principal of any
Advance, (ii) within three (3) days after the same
shall become due, any interest or fee payable
hereunder or pursuant to any other Loan Document
or (iii) within three (3) days after written
demand therefor from the Administrative Agent or
any Lender, any other amount payable hereunder or
pursuant to any other Loan Document; or
(b) Specific Covenants. The Borrower shall
fail to observe or perform any covenant contained
in Articles VI, VII or VIII; provided, that, with
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(177)
respect to a failure to observe or perform the
covenants set forth in Sections 7.1(g), 7.1(k),
7.1(l), 7.3, or 7.6, such failure shall continue
for fifteen (15) days or more after written notice
thereof to the Borrower from the Administrative
Agent or any Lender; or
(c) Other Covenants. The Borrower shall
fail to observe or perform any covenant or
agreement contained in this Agreement or any other
Loan Document (other than those covered by Section
9.1(a) or (b)) for thirty (30) days or more after
written notice thereof has been given to the
Borrower by the Administrative Agent or the
Required Lenders; or
(d) Representation or Warranty. Any
representation, warranty, certification or
statement made by the Borrower or any Material
Subsidiary in this Agreement, any other Loan
Document or in any certificate, financial
statement or other document delivered pursuant
hereto or thereto shall prove to have been
incorrect in any material respect when made or
deemed to have been made; or
(e) Cross-Default. Without limiting the
terms of Section 9.1(n) or Section 9.1(o), the
Borrower or any of its Subsidiaries (i) shall fail
to make any payment in respect of any Debt when
due (beyond the period of grace, if any, and
whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise)
which Debt is in an aggregate principal amount of
$10,000,000 or more; or (ii) shall fail to perform
or observe any other condition or covenant, or any
other event shall occur or condition exist, under
any agreement or instrument relating to any such
Debt, and such failure shall continue after the
applicable grace or notice period, if any,
specified in the document relating thereto if the
effect of such failure, event or condition is to
cause, or to permit the holder or holders of such
Debt or beneficiary or beneficiaries of such Debt
(or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause,
such Debt to be declared to be due and payable
prior to its stated maturity or cash collateral in
respect thereof to be demanded; or
(f) Insolvency; Voluntary Proceeding. The
Borrower or any of its Material Subsidiaries shall
(i) generally fail to pay, or admit in writing its
inability to pay, its debts as they become due,
subject to applicable grace periods, if any,
whether at stated maturity or otherwise;
(ii) commence any Insolvency Proceeding with
respect to itself; or (iii) take any action to
effectuate or authorize any of the foregoing or
the Borrower or any of its Material Subsidiaries
shall voluntarily cease to conduct its business in
the ordinary course except, in the case of
Material Subsidiaries, as expressly permitted by
the terms of Section 8.4 of this Agreement; or
(g) Involuntary Proceeding. (i) Any
involuntary Insolvency Proceeding shall be
commenced or filed against the Borrower or any of
its Material Subsidiaries, or any writ, judgment,
warrant of attachment, execution or similar
process, shall be issued or levied against all or
a substantial part of the Borrower or any of its
Subsidiaries' assets, and any such proceeding or
petition shall not be dismissed, or such writ,
judgment, warrant of attachment, execution or
similar process shall not be released, vacated or
fully bonded within sixty (60) days after
- -64-
(178)
commencement, filing or levy; (ii) the Borrower or
any of its Material Subsidiaries shall admit the
material allegations of a petition against it in
any Insolvency Proceeding, or an order for relief
(or similar order under non-U.S. law) shall be
ordered in any Insolvency Proceeding; or (iii) the
Borrower or any of its Material Subsidiaries shall
acquiesce in the appointment of a receiver,
trustee, custodian, conservator, liquidator,
mortgagee in possession (or agent therefor), or
other similar Person for itself or a substantial
portion of its assets or business; or
(h) ERISA Event. Any ERISA Event shall have
occurred with respect to a Plan and, thirty (30)
days after notice thereof shall have been given to
the Borrower by the Administrative Agent or any
Lender, (i) such ERISA Event shall still exist and
(ii) the sum (determined as of the date of
occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency
of any and all other Plans with respect to which
an ERISA Event shall have occurred and then exist
(or, in the case of a Plan with respect to which
an ERISA Event described in clauses (iii) through
(vi) of the definition of ERISA Event shall have
occurred and then exist, the liability related
thereto) exceeds $2,500,000; or
(i) Withdrawal Liability. The Borrower, any
of its Subsidiaries or any ERISA Affiliate shall
have been notified by the sponsor of a
Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount
which, when aggregated with all other amounts
required to be paid to Multiemployer Plans by the
Borrower, any of its Subsidiaries or any ERISA
Affiliate as Withdrawal Liability (determined as
of the date of such notification), exceeds
$2,500,000; or
(j) Monetary Judgments. One or more non-
interlocutory judgments, non-interlocutory orders,
decrees or arbitration awards shall be entered
against the Borrower or any of its Subsidiaries
involving in the aggregate, a liability (not fully
covered by independent third-party insurance) as
to any single transaction or series of related
transactions, incidents or conditions, of
$10,000,000 or more, and the same shall remain
unsatisfied, unvacated and unstayed pending appeal
for a period of forty-five (45) days after the
entry thereof; or
(k) Non-Monetary Judgments. Any non-
monetary judgment, order or decree shall be
rendered against the Borrower or any of its
Subsidiaries which, individually or collectively
with other non-monetary judgments, orders or
decrees, does or would reasonably be expected to
have a Material Adverse Effect, and the same shall
remain unsatisfied, unvacated and unstayed pending
appeal for a period of forty-five (45) days after
the entry thereof; or
(l) Change of Control. There shall occur
any Change of Control; or
(m) Guarantor Defaults. Any of the
Guarantors shall fail in any material respect to
perform or observe any term, covenant or agreement
in the Subsidiary Guaranty and such failure shall
not be remedied within any applicable cure period
set forth therein; or the Subsidiary Guaranty
shall for any reason be partially (including with
respect to future advances) or wholly revoked or
- -65-
(179)
invalidated, or otherwise cease to be in full
force and effect, or any of the Guarantors shall
contest in any manner the validity or
enforceability thereof or deny that it has any
further liability or obligation thereunder; or
(n) Senior Debt Securities. The occurrence
and continuation of any Event of Default under and
as defined in the Senior Indenture; or
(o) Subordinated Debt Securities. The
occurrence and continuation of any Event of
Default under and as defined in the Subordinated
Indenture; or
(p) Material Adverse Effect. There shall
occur a Material Adverse Effect as determined by
the Required Lenders and such condition shall
continue fifteen (15) days or more after written
notice thereof to the Borrower from the
Administrative Agent or the Required Lenders.
Section 9.2 Remedies.
If any Event of Default occurs and is continuing,
the Administrative Agent shall, at the request of, or
may, with the consent of, the Required Lenders:
(a) declare the Commitment of each Lender to
make Advances to be terminated, whereupon such
Commitments shall forthwith be terminated;
(b) declare the unpaid principal amount of
all the Notes, all interest accrued and unpaid
thereon, and all other Obligations payable
hereunder or under any other Loan Document to be
immediately due and payable, without presentment,
demand, protest or other notice of any kind, all
of which are hereby expressly waived by the
Borrower; and
(c) exercise on behalf of itself and the
Lenders all rights and remedies available to it
and the Lenders under the Loan Documents or
applicable law;
provided, however, that upon the occurrence of any
event specified in paragraph (f) or (g) of Section 9.1
above, the obligation of each Lender to make Advances
shall automatically terminate and the unpaid principal
amount of the Notes and all interest and other
Obligations as aforesaid shall automatically become due
and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby
expressly waived by the Borrower, or any further act of
the Administrative Agent or any Lender.
- -66-
(180)
ARTICLE X
-----------
ADMINISTRATIVE AGENT, SYNDICATION AGENT AND
-------------------------------------------
MANAGING AGENT
--------------
Section 10.1 Authorization and Action.
Each Lender hereby appoints and authorizes the
Administrative Agent to take such action as agent on
its behalf and to exercise such powers under this
Agreement and each other Loan Document as are delegated
to the Administrative Agent by the terms hereof and
thereof, together with such powers as are reasonably
incidental thereto. As to any matters not expressly
provided for by this Agreement and the other Loan
Documents (including, without limitation, enforcement
or collection of the Notes and the Subsidiary
Guaranty), the Administrative Agent shall not be
required to exercise any discretion or take any action,
but shall be required to act or to refrain from acting
(and shall be fully protected in so acting or
refraining from acting) upon the instructions of the
Required Lenders, and such instructions shall be
binding upon all Lenders and all holders of Notes;
provided, that the Administrative Agent shall not be
required to take any action which exposes the
Administrative Agent to personal liability or which is
contrary to this Agreement, any other Loan Document or
applicable law. The Administrative Agent agrees to
give to each Lender prompt notice of each notice given
to it by the Borrower pursuant to the terms of this
Agreement. The Syndication Agent and the Managing
Agent, in their respective capacities as such, shall
not have any duties or obligations whatsoever under
this Agreement, the Notes, the Subsidiary Guaranty or
any of the other Loan Documents.
Section 10.2 Administrative Agent's Reliance,
etc.
Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be
liable for any action taken or omitted to be taken by
it or them under or in connection with this Agreement,
except for its or their own gross negligence or willful
misconduct as determined in a final, nonappealable
judgment by a court of competent jurisdiction. Without
limitation of the generality of the foregoing, the
Administrative Agent: (i) may treat the payee of any
Note as the holder thereof until the Administrative
Agent receives and accepts an Assignment and Acceptance
entered into by the Lender who is the payee of the Note
and an Eligible Assignees as assignee as provided
herein; (ii) may consult with legal counsel (including
counsel for the Borrower), independent public
accountants and other experts selected by it and shall
not be liable for any action taken or omitted to be
taken, in good faith by it in accordance with the
advice of such counsel, accountants or experts; (iii)
makes no warranty or representation to any Lender and
shall not be responsible to any Lender for any
statements, warranties or representations (whether
written or oral) made in or in connection with this
Agreement or any other Loan Document; (iv) shall not
have any duty to ascertain or to inquire as to the
performance or observance of any of the terms,
covenants or conditions of this Agreement or any other
Loan Document on the part of the Borrower or any
Guarantor or to inspect the property (including the
books and records) of the Borrower or any Guarantor;
(v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or
document furnished pursuant hereto; and (vi) shall
incur no liability under or in respect of this
Agreement or any other Loan Document by acting upon any
notice, consent, certificate or other instrument or
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(181)
writing (which may be by telecopier, telegram, cable or
telex) believed by it to be genuine and signed or sent
by the proper party or parties.
Section 10.3 NationsBank, FUNB, Rabobank and
Affiliates.
With respect to its Commitment, the Advances made
by it and the Note issued to it, each of NationsBank,
FUNB and Rabobank shall have the same rights and powers
under this Agreement as any other Lender and may
exercise the same as though it were not the
Administrative Agent, Syndication Agent or a Managing
Agent, as appropriate; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated,
include NationsBank, FUNB and Rabobank in their
individual capacities. NationsBank, FUNB and Rabobank
and their respective Affiliates may accept deposits
from, lend money to, act as trustee under indentures
for, and generally engage in any kind of business with,
the Borrower, the Guarantors, any of their Subsidiaries
or Affiliates and any Person who may do business with
or own securities of the Borrower, the Guarantors, or
any such Subsidiaries or Affiliates, all as if
NationsBank were not the Administrative Agent, FUNB
were not the Syndication Agent and Rabobank was not the
Managing Agent and without any duty to account therefor
to the Lenders.
Section 10.4 Lender Credit Decision.
Each Lender acknowledges that it has,
independently and without reliance upon the
Administrative Agent or any other Lender and based on
the financial statements referred to in Section 5.4 and
such other documents and information as it has deemed
appropriate, made its own credit analysis and decision
to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without
reliance upon the Administrative Agent any other Lender
and based on such documents and information as it shall
deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under
this Agreement.
Section 10.5 Indemnification.
The Lenders agree to indemnify the Administrative
Agent (to the extent not reimbursed by the Borrower),
ratably according to the respective Commitment
Percentages of each Lender from and against any and all
liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against the
Administrative Agent in any way relating to or arising
out of this Agreement or any of the other Loan
Documents or any action taken or omitted by the
Administrative Agent under this Agreement or any of the
other Loan Documents; provided that no Lender shall be
liable to the Administrative Agent for any portion of
such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses
or disbursements to the extent that any of the
foregoing is found in a final, nonappealable judgment
by a court of competent jurisdiction to have resulted
from the Administrative Agent's gross negligence or
willful misconduct. Without limitation of the
foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand for its
Commitment Percentage of any out-of-pocket expenses
(including counsel fees) incurred by the Administrative
Agent in connection with the preparation, execution,
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(182)
delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this
Agreement or any of the other Loan Documents, to the
extent that the Administrative Agent is not reimbursed
for such expenses by the Borrower.
Section 10.6 Successor Administrative Agent.
The Administrative Agent may resign at any time
by giving written notice thereof to the Lenders and the
Borrower and may be removed at any time with cause by
the Required Lenders. Upon any such resignation or
removal, the Required Lenders shall have the right to
appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so
appointed by the Required Lenders, and shall have
accepted such appointment, within 30 days after the
retiring Administrative Agent gives notice of
resignation or the Required Lenders, removal of the
retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent, which shall
be a Lender or a commercial bank organized or licensed
under the laws of the United States of America or of
any state thereof and having a combined capital and
surplus of at least $500,000,000. Upon the acceptance
of any appointment as Administrative Agent hereunder by
a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and
become vested with all the rights and duties of the
retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its
duties and obligations hereunder and under each of the
other Loan Documents. After any retiring
Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article X
shall continue to inure to its benefit as to any
actions taken or omitted to be taken by it while it was
Administrative Agent hereunder.
Section 10.7 Notice of Default.
The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Event
of Default or Default unless the Administrative Agent
has received notice from a Lender or the Borrower or
any Guarantor referring to this Agreement, describing
such Default or Event of Default and stating that such
notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the
Administrative Agent shall give prompt notice thereof
to the Lenders. The Administrative Agent shall take
such action with respect to any such Default or Event
of Default as shall be reasonably directed by the
Required Lenders, provided that, unless and until the
Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from
taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best
interests of the Lenders subject to the requirements of
this Agreement that certain actions be taken only with
the consent of a specified percentage of the Lenders.
Section 10.8 Administrative Agent's Fee.
The Borrower shall pay the Administrative Agent a
fee in such amounts and at such times as previously
agreed upon by the Administrative Agent and the
Borrower pursuant to the Fee Letter.
- -69-
(183)
ARTICLE XI
-----------
MISCELLANEOUS
-------------
Section 11.1 Notices.
All notices and other communications provided for
hereunder shall be in writing (including telecopier,
provided, however that any telecopied notices or
communications shall be confirmed by delivery of the
manually-signed original of any such notice or
communication by first-class mail, postage prepaid,
postmarked no later than five (5) Business Days after
the date of any such telecopied notice or
communication) and mailed, or delivered, if to the
Borrower, at its address at 512 Bridge Street,
Danville, Virginia 24543, Attention: James A. Cooley,
Senior Vice President and Chief Financial Officer,
Telecopier No. (804) 791-0349; if to any Lender, at its
address for notices specified on its signature page
hereto or its notice address specified in the
Assignment and Acceptance pursuant to which it became a
Lender; if to the Administrative Agent, at its address
at NationsBank, N.A., 901 Main Street, TX1-492-14-11,
Dallas, Texas 75202, Attention: Agency Services,
Telecopier No. (214) 290-9437; or, as to each party, at
such other address as shall be designated by such party
in a written notice to the other parties. All such
notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be
effective when deposited in the mails postage prepaid,
confirmed by electronic confirmation, delivered to the
telegraph company, confirmed by telex answerback or
delivered to the cable company, respectively, except
that notices and communications to the Administrative
Agent pursuant to Articles II, III or X shall not be
effective until received by the Administrative Agent.
Section 11.2 No Waivers.
No failure or delay by the Administrative Agent or
any Lender in exercising any right, power or privilege
hereunder or under any Note shall operate as a waiver
thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof
or the exercise or any other right, power or privilege.
The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies
provided by law.
Section 11.3 Expenses; Indemnity.
(a) The Borrower agrees to pay on demand (i) all
reasonable out-of-pocket costs and expenses of the
Administrative Agent, including fees and disbursements
of special counsel for the Administrative Agent, in
connection with the preparation and administration of
this Agreement and the Notes, any waiver or consent
hereunder and thereunder or any amendment hereof or
thereof or any Default or alleged Default hereunder and
thereunder and (ii) if an Event of Default occurs, all
reasonable out-of-pocket expenses incurred by the
Administrative Agent or any Lender, including
reasonable fees and disbursements of counsel (including
staff counsel), in connection with such Event of
Default and collection and other enforcement
proceedings resulting therefrom.
- -70-
(184)
(b) In addition to any other indemnity provided
for herein or in any other Loan Document, the Borrower
hereby indemnifies the Administrative Agent, the
Syndication Agent, the Managing Agent and each Lender
and their respective shareholders, directors, agents,
officers, subsidiaries and affiliates (each, an
"Indemnified Party") from and against any and all
liabilities, obligations, claims, losses, damages,
penalties, actions, judgments, suits, costs, expenses
or disbursements of any kind or nature whatsoever
(including, without limitation, reasonable fees and
expenses of counsel) which may be imposed on, incurred
by, or asserted against any Indemnified Party in, or in
connection with the preparation for a defense of, any
litigation, proceeding or investigation or claim
instituted or conducted by any Governmental Authority
or any other Person (other than the Borrower) with
respect to any aspect of, or any transaction
contemplated by, or referred to in, or any matter
related to, this Agreement or any of the other Loan
Documents contemplated hereby, whether or not any
Indemnified Party is a party thereto, except to the
extent that any of the foregoing is found in a final,
nonappealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence
or willful misconduct of such Indemnified Party or the
violation by such Indemnified Party of any latter
regulation in the conduct of its business.
Additionally, the Borrower hereby indemnifies the
Indemnified Parties and agrees to defend and hold the
Indemnified Parties harmless from and against any and
all losses, damages (including, without limitation,
consequential damages), costs, claims, liabilities,
actions, judgments, actions, suits, disbursements,
obligations, claims, penalties, fees, injuries or
expenses of whatever kind or nature (including, without
limitation, reasonable counsel fees and costs), which
any Indemnified Party may sustain or incur in
connection with any Environmental Claim asserted
against any Indemnified Party in connection with or
relating to (i) the Borrower's or any of its
Subsidiaries, premises, including, without limitation,
any real or other property now or formerly owned,
operated, leased or used by the Borrower, any of its
Subsidiaries or any of their respective predecessors;
or (ii) the Borrower's, any of its Subsidiaries, or any
of their respective predecessors, operations, whether
such operations took place before or after the date of
this Agreement, except to the extent that any of the
foregoing is found in a final, nonappealable judgment
by a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of such
Indemnified Party. The indemnification in this Section
11.3 shall survive termination of this Agreement and
the other documents executed in connection herewith as
well as the payment of all Notes.
Section 11.4 Amendments, etc.
Any provision of this Agreement, the Notes or any
other Loan Document (other than the Fee Letter, which
may be amended only in accordance with the terms
thereof) may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the
Borrower and the Required Lenders (or the
Administrative Agent with the consent of the Required
Lenders) and, if the rights or duties of the
Administrative Agent are affected thereby, by the
Administrative Agent; provided, that no such amendment
or waiver shall, unless signed by all the Lenders, (a)
increase or extend the Commitment of any Lender or
subject any Lender to any additional obligation, (b)
reduce the principal of or rate of interest on any
Advance or any fees payable hereunder, (c) postpone the
date fixed for any payment of principal of or interest
on any Advance or any fees payable hereunder, (d)
change the provisions of this Section 11.4, the
definition of "Required Lenders", or otherwise change
the percentage of Lenders required to take any action
- -71-
(185)
hereunder or under the Loan Documents, (e) release the
Borrower from its Obligations, or (f) except in
connection with a disposition of the stock or assets of
a Guarantor permitted pursuant to the terms of this
Agreement (or otherwise consented to by the Required
Lenders), release all or substantially all of the
Guarantors from their obligations under the Subsidiary
Guaranty.
Section 11.5 Successors and Assigns.
(a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the
parties hereto and their respective successors and
assigns, except that the Borrower may not assign
or otherwise transfer any of its rights or
delegate any of its duties under this Agreement
and that no Lender may assign or otherwise
transfer any of its rights hereunder, except as
specifically provided herein.
(b) Each Lender may (and, so long as no
Event of Default has occurred and is continuing,
at the election of the Borrower given pursuant to
Section 3.8 any Lender shall) assign to one or
more Eligible Assignees all or a portion of its
rights and obligations under this Agreement
(including, without limitation, all or a portion
of its Commitment and the Advances owing to it),
with the consent of the Administrative Agent and
the Borrower, which consent shall not unreasonably
be withheld or delayed; provided, that (i) each
such assignment shall be of a constant, and not a
varying, percentage of all rights and obligations
of such Lender under the Advances made by such
Lender and the Commitment held by such Lender,
(ii) unless waived in writing by the
Administrative Agent and the Borrower, the amount
of the Commitment of an assigning Lender being
assigned pursuant to each such assignment
(determined as of the date of the Assignment and
Acceptance with respect to such assignment) shall
in no event be less than $5,000,000 and shall be
an integral multiple of $1,000,000, except that in
the case of an assignment to an existing Lender
the amount of the Commitment being assigned may be
less than $5,000,000 if the assigning Lender is
assigning its entire Commitment or is retaining a
Commitment of not less than $5,000,000, and (iii)
each such assignment shall be to an Eligible
Assignee. Prior to effecting any such assignment,
the assigning Lender shall give the Administrative
Agent reasonable notice of its intent to do so,
requesting that the Administrative Agent seek the
consent of the Borrower required by this Section
11.5(b) and demonstrating that, if such consent is
obtained, the proposed assignment will otherwise
conform to the requirements of this Section
11.5(b). The Administrative Agent shall, as
promptly as is reasonably practicable after
receipt of such notice, notify such Lender whether
such consent has been obtained. If such consent
has been obtained, the parties to such assignment
shall execute and deliver to the Administrative
Agent an Assignment and Acceptance, together with
any Note subject to such assignment and an
administrative fee of $3,500, no later than five
(5) Business Days prior to the effective date of
any such assignment. Upon such execution,
delivery and acceptance, from and after the
effective date specified in each Assignment and
Acceptance, (x) the assignee thereunder shall be a
party hereto and, to the extent that rights and
obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have
the rights and obligations of a Lender hereunder
and (y) the assignor thereunder shall, to the
extent that rights and obligations hereunder have
been assigned by it pursuant to such Assignment
and Acceptance, relinquish its rights and be
- -72-
(186)
released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance
covering all or the remaining portion of an
assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a
party hereto).
(c) The Administrative Agent shall maintain
at its address referred to in Section 11.1 a copy
of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation
of the names and addresses of the Lenders and the
Commitment of, and principal amount of the
Advances owing to, each Lender from time to time
(the "Register"). The entries in the Register
shall be conclusive and binding for all purposes,
absent manifest error, and the Borrower, the
Administrative Agent, the Syndication Agent, the
Managing Agent and the Lenders may treat each
Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this
Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any
reasonable time and from time to time upon
reasonable prior notice.
(d) By executing and delivering an
Assignment and Acceptance, the Lender assignor
thereunder and the assignee thereunder confirm to
and agree with each other and the other parties
hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning
Lender makes no representation or warranty and
assumes no responsibility with respect to any
statements, warranties or representations made in
or in connection with this Agreement or any of the
other Loan Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency
or value of this Agreement or any of the other
Loan Documents; (ii) such assigning Lender makes
no representation or warranty and assumes no
responsibility with respect to the financial
condition of the Borrower or any of the Guarantors
or the performance or observance by the Borrower
or any of the Guarantors of any of its
Obligations; (iii) such assignee confirms that it
has received a copy of this Agreement, together
with copies of the financial statements referred
to in Section 5.4 and such other documents and
information as it has deemed appropriate to make
its own credit analysis and decision to enter into
such Assignment and Acceptance; (iv) such assignee
will, independently and without reliance upon the
Administrative Agent, such assigning Lender or any
other Lender and based on such documents and
information as it shall deem appropriate at the
time, continue to make its own credit decisions in
taking or not taking action under, this Agreement;
(v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and
authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such
powers, under this Agreement as are delegated to
the Administrative Agent by the terms hereof,
together with such powers as are reasonably
incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their
terms all of the obligations which by the terms of
this Agreement are required to be performed by it
as a Lender.
(e) Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an
assignee representing that it is an Eligible
Assignee, together with any Note subject to such
assignment, the Administrative Agent shall, if
such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit A
hereto (or such other form as shall be acceptable
to the Administrative Agent), (i) accept such
Assignment and Acceptance, (ii) record the
- -73-
(187)
information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.
Within five Business Days after its receipt of
such notice, the Borrower, at its own expense,
shall execute and deliver to the Administrative
Agent in exchange for the surrendered Note a new
Note payable to such Eligible Assignee in an
amount equal to the outstanding principal balance
of the ratable Commitment assigned to it pursuant
to such Assignment and Acceptance, and, if the
assigning Lender has retained a portion of the
Commitment hereunder, a new Note payable to the
assigning Lender in an amount equal to the ratable
portion of the Commitment retained by it
hereunder, as the case may be. Such new Note
shall be in an aggregate principal amount equal to
the aggregate Commitment of such surrendered Note,
shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be
in substantially the form of Exhibit A, hereto.
(f) Each Lender may sell participations to
one or more banks or (other entities in or to all
or a portion of its rights and obligations under
this Agreement (including, without limitation, all
or a portion of its Commitment, the Advances owing
to it and the Note held by it); provided, however,
that (i) such Lender's obligations under this
Agreement (including, without limitation, the
Commitment to the Borrower hereunder) shall remain
unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender
shall remain the holder of any such Note for all
purposes of this Agreement, (iv) the Borrower, the
Administrative Agent and the other Lenders shall
continue to deal solely and directly with such
Lender in connection with such Lender's rights and
obligations under this Agreement, and (v) such
Lender shall notify the Administrative Agent of
any such sale promptly after the making thereof,
specifying the purchaser and the interest
purchased, and the Administrative Agent shall
forward a copy of such notice to the Borrower.
Notwithstanding any other provision of this
Agreement, no sale or existence of any
participation shall increase any amount payable by
the Borrower pursuant to Article III hereof.
(g) Any Lender may, in connection with any
assignment or participation or proposed assignment
or participation pursuant to this Section 11.5,
disclose to the assignee or participant or
proposed assignee or participant, any information
relating to the Borrower and the Subsidiaries
furnished to such Lender by or on behalf of the
Borrower or the Subsidiaries; provided that, prior
to any such disclosure, the assignee or
participant or proposed assignee or participant
shall agree to preserve the confidentiality of any
confidential information relating to the Borrower
and its Subsidiaries received by it from such
Lender in a writing containing substantially the
terms of Section 11.12.
(h) Notwithstanding any other provision set
forth in this Agreement which may be to the
contrary, any Lender may at any time (i) assign
all or any portion of its rights and obligations
under this Agreement (including, without
limitation, all or any portion of its Commitment,
the Advances owing to it and the Note held by it)
to any Affiliate of such Lender, subject to the
proviso of the definition of "Eligible Assignee"
(with written notice to the Borrower and the
Administrative Agent) and (ii) create a security
interest in all or any portion of its rights under
this Agreement (including, without limitation, the
- -74-
(188)
Advances owing to it and the Note held by it) in
favor of any Federal Reserve Bank in accordance
with Regulation A of the Federal Reserve Board.
(i) The Administrative Agent and the
Borrower may, for all purposes of this Agreement,
treat any Lender as the holder of any Note drawn
to its order (and owner of the Advances evidenced
thereby) until written notice of assignment,
transfer or participation shall have been received
by them.
(j) If any Reference Lender assigns or
otherwise transfers its Note other than pursuant
to paragraph (h) above to any unaffiliated
institution, the Administrative Agent shall, in
consultation with the Borrower, appoint another
Lender to act as a Reference Lender hereunder;
provided that in no event shall there be more than
three (3) Reference Lenders at any given time.
Section 11.6 Right of Set-off.
Upon (i) the occurrence and during the continuance
of any Event of Default and (ii) the making of the
request or the granting of the consent specified by
Section 9.2 to authorize the Administrative Agent to
declare the Notes due and payable, each Lender is
hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and
apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and
other indebtedness at any time owing by such Lender to
or for the credit or the account of the Borrower
against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement and the
other Loan Documents, whether or, not such Lender shall
have made any demand under this Agreement and although
such obligations may be contingent and unmatured. Each
Lender agrees promptly to notify the Borrower after any
such set-off and application made by such Lender,
provided that the failure to give such notice shall not
affect the validity of such set-off and application.
The rights of each Lender under this Section 11.6 are
in addition to other rights and remedies (including,
without limitation, other rights; of set-off) which
such Lender may have.
Section 11.7 CONSENT TO JURISDICTION.
(a) THE BORROWER, IN RESPECT OF ITSELF AND
ITS PROPERTIES, REPRESENTS THAT IT IS SUBJECT TO
(AND HEREBY IRREVOCABLY SUBMITS TO) THE NON-
EXCLUSIVE JURISDICTION OF ANY COURT IN THE STATE
OF NORTH CAROLINA IN MECKLENBURG COUNTY, OR OF THE
UNITED STATES FOR THE WESTERN DISTRICT OF NORTH
CAROLINA, IN RESPECT OF ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE NOTES, AND THE BORROWER
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF
ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH COURT. THE BORROWER
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY
OBJECTION TO THE LAYING OF THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
- -75-
(189)
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORM.
(b) THE BORROWER IRREVOCABLY CONSENTS TO
PROCESS BEING SERVED IN ANY SUIT, ACTION OR
PROCEEDING OF THE NATURE REFERRED TO IN PARAGRAPH
(a) OF THIS SECTION 11.7 BY MAILING A COPY THEREOF
BY REGISTERED OR CERTIFIED AIR MAIL, POSTAGE
PREPAID, RETURN RECEIPT REQUESTED, TO THE ADDRESS
OF THE BORROWER SPECIFIED IN OR DESIGNATED
PURSUANT TO SECTION 11.1. THE BORROWER
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, ALL CLAIM
OF ERROR BY REASON OF ANY SUCH SERVICE AND AGREES,
TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO
UNDER APPLICABLE LAW, THAT SAID SERVICE (A) SHALL
BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF
PROCESS UPON THE BORROWER IN ANY SUCH SUIT, ACTION
OR PROCEEDING AND (B) SHALL BE TAKEN AND HELD TO
BE VALID PERSONAL SERVICE UPON AND PERSONAL
DELIVERY TO THE BORROWER.
The foregoing provisions shall not limit the right
of any Lender, the Administrative Agent or any other
party hereto to serve process in any other manner
permitted by law or limit the right of any Lender, the
Administrative Agent or other party hereto to bring any
suit, action or proceeding or to obtain execution on
any judgment rendered in any suit, action or proceeding
in any other appropriate jurisdiction or in any other
matter.
Section 11.8 VIRGINIA LAW.
THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF VIRGINIA.
Section 11.9 Counterparts; Effectiveness.
This Agreement may be signed in any number of
counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto
were upon the same instrument. This Agreement shall
become effective when the Administrative Agent shall
have received (i) counterparts hereof signed by all
parties and (ii) the fees referred to in Section
4.1(d). In the case of the Lenders only, such
execution may be evidenced by the execution and
delivery of signature pages by facsimile transmission
to the Administrative Agent together with a letter
addressed to the Administrative Agent confirming that
the original executed signature pages will be delivered
to the Administrative Agent by a reputable overnight
courier service.
Section 11.10 WAIVER OF JURY TRIAL.
TO THE FULLEST EXTENT PERMITTED BY LAW, EACH OF
THE BORROWER, THE ADMINISTRATIVE AGENT, THE SYNDICATION
- -76-
(190)
AGENT, THE MANAGING AGENT AND THE LENDERS HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 11.11 Termination of Existing Credit
Agreement.
By joining in the execution and delivery of this
Agreement, each of the Lenders who is a party to the
Existing Credit Agreement hereby irrevocably waives all
requirements for prior notice of the termination of its
respective commitments thereunder and hereby agrees
with the Borrower that the Existing Credit Agreement
shall terminate on the effective date of this Agreement
provided for in Section 11.9 and shall be of no
further force or effect thereafter (except for any
indemnification provisions thereof which shall survive
in accordance with the terms of such agreement).
Section 11.12 Confidentiality.
The Administrative Agent, the Syndication Agent,
the Managing Agent and the Lenders agree to keep
confidential (and to cause their respective affiliates,
officers, directors, employees, agents and
representatives to keep confidential) all information,
materials and documents furnished to the Administrative
Agent, the Syndication Agent, the Managing Agent or any
such Lender by or on behalf of the Borrower or any
Subsidiary (whether before or after the Closing Date)
which relates to the Borrower or any Subsidiary (the
"Information"). Notwithstanding the foregoing, the
Administrative Agent, the Syndication Agent, the
Managing Agent and each Lender shall be permitted to
disclose Information (i) to its affiliates, officers,
directors, employees, agents and representatives in
connection with its participation in any of the
transactions evidenced by this Agreement or any other
Loan Documents or the administration of this Agreement
or any other Loan Documents; (ii) to the extent
required by applicable laws and regulations or by any
subpoena or similar legal process, or requested by any
Governmental Authority; (iii) to the extent such
Information (A) becomes publicly available other than
as a result of a breach of this Agreement or any
agreement entered into pursuant to clause (iv) below,
(B) becomes available to the Administrative Agent, the
Syndication Agent, the Managing Agent or such Lender on
a non-confidential basis from a source other than the
Borrower or any Subsidiary or (C) was available to the
Administrative Agent, the Syndication Agent, the
Managing Agent or such Lender on a non-confidential
basis prior to its disclosure to the Administrative
Agent, the Syndication Agent, the Managing Agent or
such Lender by the Borrower or any Subsidiary; (iv) to
any assignee or participant (or prospective assignee or
participant) so long as such assignee or participant
(or prospective assignee or participant) first
specifically agrees in a writing furnished to and for
the benefit of the Borrower to be bound by the terms of
this Section 11.12; or (v) to the extent that the
Borrower shall have consented in writing to such
disclosure. Nothing set forth in this Section 11.12
shall obligate the Administrative Agent, the
Syndication Agent, the Managing Agent or any Lender to
return any materials furnished by the Borrower or any
Subsidiary.
- -77-
(191)
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed by their respective
authorized officers as of the day and year first above
written.
"BORROWER"
DIMON INCORPORATED
/s/ James A. Cooley
By________________________________
Name: James A. Cooley
Title: Senior Vice President
and Chief Financial Officer
and
/s/ Ritchie L. Bond
By_______________________________
Name: Ritchie L. Bond
Title: Senior Vice President
and Treasurer
ADDRESS FOR NOTICES:
512 Bridge Street
P.O. Box 681
Danville, Virginia 24543
Telecopier No.: (804) 791-0415
(192)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
ADMINISTRATIVE AGENT: NATIONSBANK, N.A., as
Administrative Agent
By: /s/ William F. Sweeney
By________________________________
Name: William F. Sweeney
Title: Principal
SYNDICATION AGENT: FIRST UNION NATIONAL BANK,
as Syndication Agent
By: /s/ Susan K. Doyle
By________________________________
Name: Susan K. Doyle
Title: Senior Vice President
MANAGING AGENT: COOPERATIEVE CENTRALE
RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK
INTERNATIONAL," NEW YORK BRANCH,
as Managing Agent
By: /s/ Theodore W. Cox
By________________________________
Name: Theodore W. Cox
Title: Vice President
By: /s/ Ian Reece
By________________________________
Name: Ian Reece
Title: Senior Credit Officer
(193 - 195)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
"LENDERS"
COMMITMENT NATIONSBANK, N.A.
$85,000,000.00
By: /s/ William F. Sweeney
By________________________________
Name: William F. Sweeney
Title: Principal
Domestic and Eurodollar Lending
Offices
901 Main Street
TX1-492-14-11
Dallas, Texas 75202
Attn: Molly Oxford, Corporate Credit
Services
Telecopier No.: (214) 290-9437
Address for Notices
901 Main Street
TX1-492-14-11
Dallas, Texas 75202
Attn: Molly Oxford, Corporate Credit
Services
Telecopier No.: (214) 290-9437
(196)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: CRESTAR BANK
$17,500,000.00
By: /s/ C. Gray Key
By________________________________
Name: C. Gray Key
Title: Vice President
Domestic and Eurodollar Lending
Offices
1001 Semmes Avenue
Richmond, Virginia 23224
Attention: John Cary
Telecopier No.: (804) 319-1736
Address for Notices
919 East Main Street
Richmond, Virginia 23219
Attention: Gray Key
Telecopier No.: (804) 782-5413
(197)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: FIRST UNION NATIONAL BANK
$75,000,000.00
By: /s/ Susan K. Doyle
By________________________________
Name: Susan K. Doyle
Title: Senior Vice President
Domestic and Eurodollar Lending
Offices
201 South Jefferson Street (VA-7441)
Roanoke, Virginia 24011
Attention: Ms. Susan K. Doyle
Telecopier No.: (540) 561-5262
Address for Notices
First Union National Bank
201 South Jefferson Street (VA-7441)
Roanoke, Virginia 24011
Attention: Ms. Susan K. Doyle
Telecopier No.: (540) 561-5262
(198)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: COOPERATIEVE CENTRALE RAIFFEISEN-
$60,000,000.00 BOERENLEENBANK B.A., "RABOBANK
INTERNATIONAL," NEW YORK BRANCH
By: /s/ Theodore W. Cox
By________________________________
Name: Theodore W. Cox
Title: Vice President
By: /s/ Ian Reece
By________________________________
Name: Ian Reece
Title: Senior Credit Officer
Domestic and Eurodollar Lending
Offices
10 Exchange Place, 16th Floor
Jersey City, New Jersey 07302
Attention: Swati Wadnerkar
Telecopier No.: (201) 499-5326
Address for Notices
245 Park Avenue
New York, New York 10167
Attention: Corporate Services Department
Telecopier No.: (212) 818-0233
With a copy to:
1201 West Peachtree Street,
Suite 3450
Atlanta, Georgia 30309
Attention: Mr. Theodore Cox
Telecopier No.: (404) 877-9150
(199)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: WACHOVIA BANK, N.A.
$15,000,000.00
By: /s/ Keith A. Sherman
By________________________________
Name: Keith A. Sherman
Title: Senior Vice President
Domestic and Eurodollar Lending
Offices
NC-37202
P.O. Box 37202
Winston Salem, North Carolina 27150
Attention: Mr. Greg Asbelle
Telecopier No.: (336) 732-3257
Address for Notices
227 Fayetteville Street Mall
P.O. Box 27886
Raleigh, North Carolina 27601
Attention: Mr. Keith A. Sherman
Telecopier No.: (919) 755-7806
(200)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: ABN AMRO BANK N.V. NEW YORK
BRANCH
$25,000,000.00
By: /s/ Ronald C. Spurga
By________________________________
Name: Ronald C. Spurga
Title: Vice President
By: /s/ Shameem Quadree
By________________________________
Name: Shameem Quadree
Title: Assistant Vice President
Domestic and Eurodollar Lending
Offices
500 Park Avenue
Commodities Department
New York, New York 10022
Attention: Mr. Shameem Quadree
Telecopier No.: (212) 446-4164
Address for Notices
500 Park Avenue
Commodities Department
New York, New York 10022
Attention: Mr. Christopher Plumb
Telecopier No.: (212) 688-5815
(201)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: DEUTSCHE BANK AG - AMSTERDAM
BRANCH
$15,000,000.00
By: /s/ Guy R. Fransen/
/s/ H.J. van der Heiden
By________________________________
Name: Guy R. Fransen/
H.J. van der Heiden
Title: Relationship Manager/Director
Domestic and Eurodollar Lending Offices
Herengracht 450-454
1017 CA Amsterdam
Attention: Mr. Boris Brummelhuis
Telecopier No.: 31-20-555-4552
Address for Notices
Herengracht 450-454
1017 CA Amsterdam
Attention: Mr. Guy R. Fransen
Telecopier No.: 31-20-555-4552
(202)
[Signature Page to Credit Agreement dated as of June
29, 1999 among DIMON Incorporated, as Borrower,
NationsBank, N.A., as Administrative Agent, First Union
National Bank, as Syndication Agent, and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
International," New York Branch, as Managing Agent, and
the lenders listed on the signature pages thereof, as
Lenders]
COMMITMENT: NATEXIS BANQUE
$7,500,000.00
By: /s/ Stephen A. Jendras/Alain Loisy
By________________________________
Name: Stephen A. Jendras/Alain Loisy
Title: Vice President/Senior Vice President
Domestic and Eurodollar Lending Offices
645 Fifth Avenue, 20th Floor
Commodities Department
New York, New York 10022
Attention: Mr. Terry Bethel
Telecopier: (212) 872-5045
Address for Notices
645 Fifth Avenue, 20th Floor
Commodities Department
New York, New York 10022
Attention: Mr. Stephen A. Jendras
Telecopier: (212) 872-5045
(203)