EXECUTION COPY
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CREDIT AGREEMENT
among
GENERAL CHEMICAL INDUSTRIAL PRODUCTS INC.,
GENERAL CHEMICAL CANADA LTD.,
The Several Lenders
from Time to Time Parties Hereto,
THE CHASE MANHATTAN BANK,
as Administrative Agent,
THE CHASE MANHATTAN BANK OF CANADA,
as Canadian Administrative Agent,
THE BANK OF NOVA SCOTIA,
as Syndication Agent,
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Documentation Agent
Dated as of April 30, 1999
CHASE SECURITIES INC. and THE BANK OF NOVA SCOTIA, as Co-Arrangers
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TABLE OF CONTENTS
Pages
SECTION 1. DEFINITIONS AND INTERPRETATION ................................ 2
1.1 Defined Terms ............................................... 2
1.2 Other Definitional Provisions ...............................31
1.3 Conflict Between Credit Agreement and other Loan Documents...32
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS................................32
2.1 Commitments ................................................ 32
2.2 Procedure for Borrowing .....................................32
2.3 Canadian B/A Loans; Acceptances .............................34
2.4 Reallocation ................................................37
2.5 Canadian Borrower ...........................................38
2.6 Repayment of Loans; Evidence of Debt ........................38
2.7 Commitment Fee ..............................................40
2.8 Optional Termination or Reduction of Commitments ............40
2.9 Optional Prepayments; Mandatory Prepayments and
Commitment Reductions .....................................41
2.10 Conversion and Continuation Options .........................43
2.11 Minimum Amounts of Tranches .................................44
2.12 Interest Rates and Payment Dates ............................44
2.13 Computation of Interest and Fees ............................45
2.14 Inability to Determine Interest Rate.........................46
2.15 Pro Rata Treatment and Payments..............................46
2.16 Illegality...................................................48
2.17 Requirements of Law..........................................48
2.18 Taxes........................................................50
2.19 Indemnity....................................................52
2.20 Change of Lending Office.....................................53
2.21 Replacement of Lenders under Certain Circumstances...........53
SECTION 3. LETTERS OF CREDIT..............................................54
3.1. L/C Commitment..............................................54
3.2. Procedure for Issuance of Letters of Credit.................55
3.3. Fees, Commissions and Other Charges.........................55
3.4. L/C Participations..........................................55
3.5. Reimbursement Obligation of the Borrowers...................56
3.6. Obligations Absolute........................................57
3.7. Letter of Credit Payments...................................58
3.8. Application.................................................58
SECTION 4. REPRESENTATIONS AND WARRANTIES.................................58
4.1 Financial Condition..........................................58
4.2 No Change....................................................59
4.3 Corporate Existence; Compliance with Law.....................59
4.4 Corporate Power; Authorization; Enforceable Obligations......59
4.5 No Legal Bar.................................................60
4.6 No Material Litigation.......................................60
4.7 No Default...................................................60
4.8 Ownership of Property; Liens.................................60
4.9 Intellectual Property........................................61
4.10 Taxes.......................................................61
4.11 Federal Regulations.........................................61
4.12 ERISA; Canadian Benefit and Pension Plans...................61
4.13 Investment Company Act; Other Regulations...................62
4.14 Subsidiaries................................................62
4.15 Purpose of Loans............................................62
4.16 Environmental Matters.......................................62
4.17 Soda Ash Partners...........................................64
4.18 Solvency....................................................64
4.19 Labor Matters...............................................64
4.20 Accuracy of Information, etc................................64
4.21 Security Documents..........................................65
4.22 Year 2000...................................................65
4.23 Industrial Chemicals Business...............................65
4.24 Senior Indebtedness.........................................65
SECTION 5. CONDITIONS PRECEDENT...........................................66
5.1 Conditions to Effectiveness..................................66
5.2 Conditions to Initial Loans and Letters of Credit............68
5.3 Conditions to Each Extension of Credit.......................69
SECTION 6. AFFIRMATIVE COVENANTS..........................................70
6.1 Financial Statements.........................................70
6.2 Certificates; Other Information..............................71
6.3 Payment of Obligations.......................................72
6.4 Conduct of Business and Maintenance of Existence.............72
6.5 Maintenance of Property; Insurance...........................72
6.6 Inspection of Property; Books and Records; Discussions.......72
6.7 Notices......................................................73
6.8 Environmental Laws...........................................73
6.9 Further Assurances...........................................74
6.10 Additional Collateral.......................................74
6.11 GC Canada Senior Notes......................................77
6.12 Canadian Pension Plans and Benefit Plans....................77
6.13 Post-Closing Real Estate Matters............................77
SECTION 7. NEGATIVE COVENANTS ............................................78
7.1 Financial Condition Covenants................................78
7.2 Limitation on Indebtedness...................................79
7.3 Limitation on Liens..........................................81
7.4 Limitation on Guarantee Obligations...........................83
7.5 Limitation on Fundamental Changes............................83
7.6 Limitation on Sale of Assets ................................83
7.7 Amendments to Spin-Off Documents.............................84
7.8 Limitations on Restricted Payments...........................84
7.9 Limitation on Capital Expenditures...........................85
7.10 Limitation on Investments, Loans and Advances...............86
7.11 Limitations on Optional Payments and Modifications
of Agreements...............................................88
7.12 Limitation on Transactions with Affiliates..................89
7.13 Limitation on Sales and Leasebacks..........................90
7.14 Limitation on Changes in Fiscal Year........................90
7.15 Limitation on Negative Pledge Clauses.......................90
7.16 Limitation on Lines of Business.............................90
SECTION 8. EVENTS OF DEFAULT..............................................91
8.1 Events of Default............................................91
8.2 Certain Provisions Applicable to Letters of Credit...........94
8.3 Certain Waivers..............................................95
SECTION 9. THE AGENTS.....................................................95
9.1 Appointment..................................................95
9.2 Delegation of Duties.........................................95
9.3 Exculpatory Provisions.......................................96
9.4 Reliance by Administrative Agent.............................96
9.5 Notice of Default............................................96
9.6 Non-Reliance on Administrative Agent and Other Lenders.......97
9.7 Indemnification..............................................97
9.8 Administrative Agent in Its Individual Capacity..............98
9.9 Successor Administrative Agent...............................98
9.10 Canadian Administrative Agent...............................98
9.11 Documentation Agent and Syndication Agent...................99
SECTION 10. MISCELLANEOUS.................................................99
10.1 Amendments and Waivers......................................99
10.2 Notices....................................................100
10.3 No Waiver; Cumulative Remedies.............................102
10.4 Survival of Representations and Warranties.................102
10.5 Payment of Expenses and Taxes..............................102
10.6 Successors and Assigns; Participations and Assignments.....103
10.7 Adjustments; Set-off.......................................106
10.9 Severability ..............................................107
10.10 Integration ..............................................107
10.11 GOVERNING LAW.............................................107
10.12 Submission To Jurisdiction; Waivers.......................108
10.13 Acknowledgments...........................................108
10.14 WAIVERS OF JURY TRIAL.....................................109
10.15 Confidentiality...........................................109
10.16 Conversion of Currencies..................................109
ANNEX A PRICING GRID
SCHEDULES
Schedule I Lenders, Commitments and Addresses
Schedule II Subsidiaries of the Company
Schedule III Outstanding Indebtedness; Existing Liens
Schedule IV Existing Letters of Credit
Schedule V Canadian Benefit Plans and Canadian Pension Plans
Schedule VI Canadian Mortgaged Properties
EXHIBITS
Exhibit A-1 Form of Opinion of Debevoise & Plimpton
Exhibit A-2 Form of Opinion of Blake, Cassels & Graydon
Exhibit A-3 Form of Opinion of General Counsel of Company
Exhibit B Form of Compliance Certificate
Exhibit C Form of Assignment and Acceptance
Exhibit D Form of Confidentiality Agreement
Exhibit E-1 Form of Guarantee and Collateral Agreement
Exhibit E-2 Form of Canadian Guarantee and Collateral
Agreement
Exhibit E-3 Form of Canadian Mortgage
Exhibit F-1 Form of Revolving Credit Note
Exhibit F-2 Form of Canadian Revolving Credit Note
Exhibit G Form of U.S. Tax Compliance Certificate
Exhibit H Form of Acceptance
CREDIT AGREEMENT, dated as of April 30, 1999, among GENERAL
CHEMICAL INDUSTRIAL PRODUCTS INC., a Delaware corporation (the "Company"),
GENERAL CHEMICAL CANADA LTD., a Canadian corporation (the "Canadian Borrower"),
the several banks and other financial institutions from time to time parties to
this Agreement (the "Lenders"), THE CHASE MANHATTAN BANK, a New York banking
corporation, as administrative agent for the Lenders (in such capacity, the
"Administrative Agent"), THE CHASE MANHATTAN BANK OF CANADA, a Canadian
chartered bank, as Canadian administrative agent for the Lenders under the
Canadian Revolving Credit Facility (in such capacity, the "Canadian
Administrative Agent"), THE BANK OF NOVA SCOTIA, as syndication agent for the
Lenders (in such capacity, the "Syndication Agent"), and THE FIRST NATIONAL BANK
OF CHICAGO, as documentation agent for the Lenders (in such capacity, the
"Documentation Agent").
RECITALS
WHEREAS, pursuant to the Separation Agreement dated as of
April 15, 1999 (as amended, modified or supplemented from time to time in
accordance with subsection 7.7, the "Separation Agreement") between The General
Chemical Group Inc., a Delaware corporation ("Holdings"), and GenTek, Inc., a
Delaware corporation ("GenTek") which is a wholly-owned Subsidiary (such term
and the other capitalized terms used in these recitals having the meaning set
forth in this Agreement unless the context otherwise requires) of New Hampshire
Oak, a Delaware corporation ("Intermediate Holdings"), which is a wholly-owned
Subsidiary of Holdings, Holdings has agreed to separate and divide the existing
businesses of Holdings so that (a) the industrial chemicals businesses (the
"Industrial Chemicals Business") of Holdings shall be owned directly and
indirectly by the Company, and (b) the manufacturing and performance products
businesses of Holdings shall be owned directly and indirectly by GenTek;
WHEREAS, following the separation and division described in
the preceding paragraph (the "Separation") (a) Intermediate Holdings will
distribute to Holdings all of the Capital Stock of GenTek (the "NHO
Distribution") and (b) Holdings shall distribute, as a dividend to the holders
of the shares of its common stock, all of the Capital Stock of GenTek (the
transactions described in paragraph 1 above and this paragraph 2, all as more
particularly described in the Form 10 Filing, the "Spin-Off");
WHEREAS, pursuant to the Separation Agreement and in
connection with the Spin-Off, certain pre-existing indebtedness of Holdings, the
Company and GenTek and their respective Subsidiaries will be paid in full and
canceled and certain other transactions will be consummated (the Spin-Off and
the other transactions to be performed pursuant to and in connection with the
Spin-Off, the "Spin-Off Transactions");
WHEREAS, the Company has requested that the Lenders make
available to the Company an $85,000,000 five-year revolving credit facility (as
hereinafter defined, the "Revolving Credit Facility"), a portion of which will
be available to the Canadian Borrower as a revolving credit subfacility (the
"Canadian Revolving Credit Facility"), the proceeds of which will be used by the
Borrowers to finance working capital and general corporate purposes, including
financing permitted acquisitions and permitted investments and funding the
Spin-Off Transactions; and
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WHEREAS, the Lenders are willing to make available the
Revolving Credit Facility and the Canadian Revolving Credit Facility pursuant to
this Agreement upon the terms and conditions hereinafter set forth.
NOW THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATION
1.1 Defined Terms. As used in this Agreement, the following
terms shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Base CD Rate in effect on
such day plus 1% and (c) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. For purposes hereof: "Prime Rate" shall mean
the rate of interest per annum publicly announced from time to time by
Chase as its prime rate in effect at its principal office in New York
City (the Prime Rate not being intended to be the lowest rate of
interest charged by Chase in connection with extensions of credit to
debtors); "Base CD Rate" shall mean the sum of (a) the product of (i)
the Three-Month Secondary CD Rate and (ii) a fraction, the numerator of
which is one and the denominator of which is one minus the C/D Reserve
Percentage and (b) the C/D Assessment Rate; "Three-Month Secondary CD
Rate" shall mean, for any day, the secondary market rate for
three-month certificates of deposit reported as being in effect on such
day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board through the public information telephone
line of the Federal Reserve Bank of New York (which rate will, under
the current practices of the Board, be published in Federal Reserve
Statistical Release H.15(519) during the week following such day), or,
if such rate shall not be so reported on such day or such next
preceding Business Day, the average of the secondary market quotations
for three-month certificates of deposit of major money center banks in
New York City received at approximately 10:00 A.M., New York City time,
on such day (or, if such day shall not be a Business Day, on the next
preceding Business Day) by the Administrative Agent from three New York
City negotiable certificate of deposit dealers of recognized standing
selected by it; and "Federal Funds Effective Rate" shall mean, for any
day, 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 on the next succeeding 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 the day of such transactions received by the
Administrative Agent from three federal funds brokers of recognized
standing selected by it. If for any reason the Administrative Agent
shall have determined (which determination shall be conclusive absent
manifest error) that it is unable to ascertain the Base CD Rate or the
Federal Funds Effective Rate, or both, for any reason, including the
inability or failure of the Administrative Agent to obtain sufficient
quotations in accordance with the terms thereof, the ABR shall be
determined without regard to clause (b) or (c), or both, of the first
sentence of this definition, as
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appropriate, until the circumstances giving rise to such inability no
longer exist. Any change in the ABR due to a change in the Prime Rate,
the Three-Month Secondary CD Rate or the Federal Funds Effective Rate
shall be effective as of the opening of business on the effective day
of such change in the Prime Rate, the Three-Month Secondary CD Rate or
the Federal Funds Effective Rate, respectively.
"ABR Loans": Loans the rate of interest applicable to which
is based upon the ABR.
"Acceptance" and "B/A": a banker's acceptance or a depository
bill within the meaning of the Depository Bills and Notes Act (Canada),
in either case denominated in C$ issued by the Canadian Borrower and
accepted and, if applicable, purchased by a Canadian Revolving Credit
Lender in accordance with this Agreement.
"Acceptance Exposure": at any time, the aggregate face amount
of Canadian B/A Loans.
"Acceptance Reimbursement Obligations": the obligation of the
Canadian Borrower to reimburse the Canadian Revolving Credit Lenders
pursuant to subsections 2.3(h) and 2.3(i).
"Adjustment Date": as defined in the Pricing Grid.
"Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person. For
purposes of this definition, "control" of a Person means the power,
whether or not exercised, directly or indirectly, to direct or cause
the direction of the management and policies of such Person, whether by
contract or otherwise or through the direct or indirect ownership of
10% (or, for purposes of subsection 10.6, 50%) or more of any class of
Capital Stock of such Person.
"Agents": the collective reference to the Administrative
Agent, the Canadian Administrative Agent, the Documentation Agent and
the Syndication Agent.
"AGI": The Andover Group, Inc., a Delaware corporation.
"Agreement": this Credit Agreement, as amended, supplemented
or otherwise modified from time to time.
"Allocable Tax Obligations": (a) the Company's share (based on
the ratio of the book value of the Company and its Subsidiaries to the
book value of Holdings and its Subsidiaries (including the Company and
its Subsidiaries)) of any state or local taxes, other than taxes
imposed on or measured by income or receipts, that are imposed on
Holdings or Intermediate Holdings by virtue of Holdings or Intermediate
Holdings (as the case may be) (i) being incorporated in such state or
locality, (ii) having Capital Stock
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outstanding or (iii) owning the stock of the Company (but excluding
any taxes imposed on or attributable to any dividends received from
the Company), (b) any payments in respect of taxes required to be
made by Holdings under the Spin-Off Documents (less any refunds of
such taxes that are received by Holdings or Intermediate Holdings and
not repaid to the Company) and (c) any taxes of the Company or its
Subsidiaries that are measured by income and for which Holdings or
Intermediate Holdings is liable up to an amount not to exceed with
respect to such federal taxes, the amount of any such taxes that the
Company would have been required to pay on a consolidated basis if
the Company had filed a consolidated return on behalf of an affiliated
group (as defined in section 1504 of the Code) of which it was the
common parent, or with respect to such state, local and foreign taxes,
the amount of taxes that the Company would have been required to pay
if the Company and its eligible Subsidiaries had filed an unaffiliated,
combined or unitary return with respect to such state, local or
foreign taxes.
"Allocation Lender": either (a) an Affiliate of a Canadian
Revolving Credit Lender, which Affiliate has a Revolving Credit
Commitment or is the holder of Revolving Credit Loans, or (b) a
Canadian Revolving Credit Lender having such an Affiliate.
"Applicable Agent": (i) the Administrative Agent with respect
to the Revolving Credit Commitments and (ii) the Canadian
Administrative Agent with respect to the Canadian Revolving Credit
Commitments.
"Applicable Margin": for each Type of Loan, the rate per annum
set forth under the relevant column heading below:
Type Applicable Margin
Eurodollar Loans 2.75%
Canadian B/A Loans (Stamping Fee) 2.75
ABR Loans 1.50
Canadian Base Rate Loans 1.50
Canadian Prime Rate Loans 1.50
provided, that on and after the first Adjustment Date after December
31, 1999, the Applicable Margin will be determined pursuant to the
Pricing Grid.
"Applicable Percentage": (x) with respect to any Revolving
Credit Lender, the percentage of the Total Revolving Credit
Commitments represented by such Revolving Credit Lender's Revolving
Credit Commitment, or (y) with respect to any Canadian Revolving
Credit Lender, the percentage of the Total Canadian Revolving Credit
Commitments represented by such Canadian Revolving Credit Lender's
Canadian Revolving Credit Commitment.
"Application": an application, in such form as the relevant
Issuing Bank may specify from time to time, requesting such Issuing
Bank to open a Letter of Credit.
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"Asset Sale": (a) any Disposition of any assets or rights
other than sales of (i) inventory in the ordinary course of business
consistent with past practices and (ii) obsolete assets, and (b) any
issuance or sale by the Company or any of its Subsidiaries of Equity
Interests of any of the Company's Subsidiaries, in the case of either
clause (a) or (b), whether in a single transaction or a series of
related transactions (x) that have a fair market value in excess of
$2,000,000 or (y) for net proceeds in excess of $2,000,000.
Notwithstanding the foregoing, the following items shall not be deemed
to be Asset Sales: (A) a transfer of assets by (1) the Company to the
Canadian Borrower, a Subsidiary Guarantor or a Canadian Subsidiary
Guarantor, (2) a Subsidiary to the Company, the Canadian Borrower, a
Subsidiary Guarantor or a Canadian Subsidiary Guarantor or (3) a
Subsidiary (other than the Canadian Borrower) that is not a Subsidiary
Guarantor or a Canadian Subsidiary Guarantor to any Subsidiary that is
not a Subsidiary Guarantor or a Canadian Subsidiary Guarantor, (B) an
issuance of Equity Interests by (1) a Subsidiary to the Company, the
Canadian Borrower, a Subsidiary Guarantor or a Canadian Subsidiary
Guarantor or (2) a Subsidiary (other than the Canadian Borrower) that
is not a Subsidiary Guarantor or a Canadian Subsidiary Guarantor to
any other Subsidiary that is not a Subsidiary Guarantor or a Canadian
Subsidiary Guarantor, (C) a Lien that is permitted under subsection
7.3, (D) any Disposition constituting a Permitted Investment and (E)
any Disposition constituting a Mineral Rights Exchange.
"Assignee": as defined in subsection 10.6(c).
"Available Canadian Revolving Credit Commitment": as to any
Canadian Revolving Credit Lender at any time, an amount equal to the
excess, if any, of (a) such Lender's Canadian Revolving Credit
Commitment then in effect over (b) such Lender's Canadian Revolving
Extensions of Credit then outstanding.
"Available Revolving Credit Commitment": as to any Revolving
Credit Lender at any time, an amount equal to the excess, if any, of
(a) such Lender's Revolving Credit Commitment then in effect over (b)
such Lender's Revolving Extensions of Credit then outstanding.
"Board": the Board of Governors of the Federal Reserve System
and any successor thereto.
"Borrowers": the collective reference to the Company and the
Canadian Borrower; either of them, a "Borrower."
"Borrowing Date": any Business Day specified in a notice
pursuant to subsection 2.2, 2.3, 2.4 or 3.2 as a date on which a
Borrower requests the Lenders to make Loans hereunder or an Issuing
Bank to issue a Letter of Credit hereunder.
"Business": as defined in subsection 4.16.
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"Business Day": (i) for all purposes other than as covered by
clause (ii) below, a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by
law to close, (ii) with respect to notices and determinations in
connection with, and payments of principal and interest on, Eurodollar
Loans, any day which is a Business Day described in clause (i) (or
clause (iii) with respect to Eurodollar Loans made by a Canadian
Revolving Credit Lender) and which is also a day for trading by and
between banks in Dollar deposits in the interbank eurodollar market,
and (iii) with respect to the making of Canadian Revolving Credit Loans
or the issuance of Letters of Credit under the Canadian Revolving
Credit Commitment, any payment in respect thereof, or any other dealing
in Canadian Dollars pursuant to this Agreement, any day which is a
Business Day described in clause (i) and which is also not a Saturday,
Sunday or other day on which chartered banks in Toronto, Ontario are
authorized or required by law to close.
"C$ Prime Rate": on any day, the annual rate of interest equal
to the annual rate of interest published from time to time by the
Canadian Administrative Agent as its prime rate in effect at its
principal office in Toronto on such day for determining interest rates
on C$ denominated commercial loans in Canada.
"Canadian Administrative Agent": Chase Canada and its
successors, as administrative agent for the Canadian Revolving Credit
Lenders and as collateral agent for the Canadian Revolving Credit
Lenders under the Canadian Security Documents.
"Canadian B/A Loan": a Canadian Revolving Credit Loan
comprised of Acceptances. The principal amount of any Canadian B/A Loan
shall be deemed to be the aggregate face amount of the relevant
Acceptances.
"Canadian Base Rate Loan": a Canadian Revolving Credit Loan
denominated in $ which bears interest based upon the US Base Rate.
"Canadian Benefit Plans": all material employee benefit plans
of any nature or kind whatsoever that are not Canadian Pension Plans
and are maintained or contributed to by any Borrower or any of its
respective Subsidiaries, in each case covering employees in Canada.
"Canadian Borrower": as defined in the preamble to this
Agreement.
"Canadian Borrower Obligations": the unpaid principal of and
interest on (including, without limitation, interest accruing after the
maturity of the Loans, Acceptance Reimbursement Obligations and
Reimbursement Obligations and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Canadian Borrower,
whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding) the Loans made to the Canadian Borrower and
all other obligations and liabilities of the Canadian Borrower to the
Administrative Agent, the Canadian Administrative Agent or any Lender
(or, in the case of Interest Rate Protection
7
Arrangements or Currency Agreements, any Affiliate of any Lender),
whether direct or indirect, absolute or contingent, due or to become
due, or now existing or hereafter incurred, of the Canadian
Borrower which may arise under, out of, or in connection with,
this Agreement, any other Loan Document, the Letters of Credit,
any Interest Rate Protection Arrangement or Currency Agreement
entered into with any Lender or any Affiliate of any Lender
or any other document made, delivered or given in connection herewith
or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including, without
limitation, all fees, charges and disbursements of counsel to the
Administrative Agent, the Canadian Administrative Agent or to any
Lender that are required to be paid by the Canadian Borrower pursuant
hereto) or otherwise.
"Canadian Dollars" and "C$": lawful currency of Canada.
"Canadian Guarantee and Collateral Agreement": the Canadian
Guarantee and Collateral Agreement to be executed and delivered by the
Canadian Borrower and each Canadian Subsidiary Guarantor, substantially
in the form of Exhibit E-2, as the same may be amended, supplemented or
otherwise modified from time to time.
"Canadian Holdings": General Chemical Canada Holding Inc., an
Ontario corporation.
"Canadian Mortgaged Properties": the real properties listed on
Schedule VI (which shall include the Canadian Borrower's plant and
"settling ponds/basins" located in Amherstburg, Ontario), as to which
the Canadian Administrative Agent for the benefit of the Canadian
Revolving Credit Lenders shall be granted a Lien pursuant to the
Canadian Mortgages.
"Canadian Mortgages": each of the Charge/Mortgage of Land, the
Fixed and Floating Charge Debenture, the Pledge Agreement and the
related documents, in each case made by the Canadian Borrower and/or
the Canadian Subsidiary Guarantors in favor of, or for the benefit of,
the Canadian Administrative Agent for the benefit of the Canadian
Revolving Credit Lenders, substantially in the form of Exhibit E-3
(with such changes thereto as shall be advisable under the law of the
jurisdiction in which such mortgage is to be recorded), as the same may
be amended, supplemented or otherwise modified from time to time.
"Canadian Pension Plan": each plan which is considered to be a
pension plan for the purposes of any applicable pension benefits
standards statute and/or regulation in Canada established, maintained
or contributed to by any Borrower or any of its respective Subsidiaries
for its employees or former employees.
"Canadian Prime Rate Loan": a Canadian Revolving Credit Loan
denominated in C$ which bears interest at a rate based upon the C$
Prime Rate.
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"Canadian Revolving Credit Commitment": as to any Lender, the
obligation of such Lender, if any, to make Canadian Revolving Credit
Loans and participate in Letters of Credit issued under the Canadian
Revolving Credit Commitments in Dollars or Canadian Dollars, as
applicable, in an aggregate principal and/or face amount the Dollar
Equivalent Amount of which shall not exceed of the amount set forth
under the heading "Canadian Revolving Credit Commitment" opposite such
Lender's name on Schedule I, as the same may be changed from time to
time pursuant to the terms hereof. The Canadian Revolving Credit
Commitments shall be denominated in Dollars although extensions of
credit thereunder may be denominated in Dollars or Canadian Dollars as
provided in this Agreement.
"Canadian Revolving Credit Lender": each Lender which has a
Canadian Revolving Credit Commitment or which is the holder of Canadian
Revolving Credit Loans. Each Canadian Revolving Credit
Lender must be a Canadian Scheduled Lender.
"Canadian Revolving Credit Loans": as defined in subsection
2.1(b).
"Canadian Revolving Credit Percentage": as to any Canadian
Revolving Credit Lender at any time, the percentage which such Lender's
Canadian Revolving Credit Commitment then constitutes of the Total
Canadian Revolving Credit Commitments (or, at any time after the
Canadian Revolving Credit Commitments shall have expired or terminated,
the percentage which the aggregate principal amount of such Lender's
Canadian Revolving Credit Loans then outstanding constitutes of the
aggregate principal amount of the Canadian Revolving Credit Loans then
outstanding).
"Canadian Revolving Extensions of Credit": as to any Canadian
Revolving Credit Lender at any time, an amount equal to the Dollar
Equivalent Amount of the sum of (a) the aggregate principal amount of
all Canadian Revolving Credit Loans made by such Lender then
outstanding and (b) such Lender's Canadian Revolving Credit Percentage
of the L/C Obligations then outstanding under the Canadian Revolving
Credit Commitments.
"Canadian Schedule I Lender": each Canadian Revolving Credit
Lender that is a bank listed on Schedule I to the Bank Act (Canada), as
amended.
"Canadian Schedule II Lender": each Canadian Revolving Credit
Lender that is a bank listed on Schedule II to the Bank Act (Canada),
as amended.
"Canadian Scheduled Lender": a Canadian Schedule I Lender or a
Canadian Schedule II Lender.
"Canadian Security Documents": the collective reference to the
Canadian Guarantee and Collateral Agreement, the Canadian Mortgages and
all other documents or instruments hereafter delivered to or for the
benefit of the Canadian Administrative Agent and the Canadian Revolving
Credit Lenders granting a Lien on any asset or assets
9
of any Person to secure the obligations and liabilities of the Canadian
Borrower hereunder, under the Notes and/or under any of the other Loan
Documents or to secure any guarantee of any such obligations and
liabilities by any Canadian Subsidiary Guarantors.
"Canadian Subsidiary Guarantors": (a) NHO Canada, Canadian
Holdings and each Subsidiary of the Canadian Borrower 80% or more of
the common Equity Interests of which is owned directly or indirectly by
the Canadian Borrower, and (b) each other Subsidiary of Canadian
Holdings or the Canadian Borrower that becomes a party to the Canadian
Guarantee and Collateral Agreement.
"Capital Expenditures": as defined in subsection 7.9.
"Capital Stock": any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person
(other than a corporation) and any and all warrants, options or other
rights to purchase any of the foregoing.
"Cash": money, currency or a credit balance in a deposit
account, in each case which is free of Liens (except Liens in favor of
the Administrative Agent and the Canadian Administrative Agent and
Liens consisting of bankers' set-off rights).
"Cash Equivalents: (i) any evidence of Indebtedness with a
maturity of two years or less issued or directly and fully guaranteed
or insured by the United States of America, Canada (or any province
thereof) or any agency or instrumentality of any of the foregoing
(provided that the full faith and credit of the United States of
America or Canada, as applicable, is pledged in support thereof); (ii)
certificates of deposit or acceptances with a maturity of one year or
less of any Lender or any financial institution that is a member of the
Federal Reserve System (or is a chartered bank incorporated in Canada)
having combined capital and surplus and undivided profits of not less
than $500,000,000; (iii) master notes, loan participations and
commercial paper with a maturity of two years or less issued by any
Lender or any corporation (except an Affiliate or Subsidiary of the
Company) organized under the laws of any State of the United States or
the District of Columbia or under the laws of Canada (or any province
thereof) and rated at least A-1 by S&P or at least P-1 by Moody's; (iv)
repurchase agreements and reverse repurchase agreements relating to
marketable direct obligations issued or unconditionally guaranteed by
the United States Government or Canada (or any province therof) or
issued by any agency of the forgoing and backed by the full faith and
credit of the United States of America (or Canada, as applicable), in
each case maturing within one year from the date of acquisition;
provided that the terms of such agreements comply with the guidelines
set forth in the Federal Financial Agreements of Depository
Institutions With Securities Dealers and Others, as adopted by the
Comptroller of the Currency on October 31, 1985; (v) time deposits of
foreign banks having a combined capital and surplus of not less than
$500,000,000; (vi) repurchase agreements with nationally recognized
securities dealers having total capital funds in excess of
$100,000,000; provided that the terms of such agreements comply with
the
10
guidelines set forth in the Federal Financial Agreements of
Depository Institutions With Securities Dealers and Others, as adopted
by the Comptroller of the Currency on October 31, 1985; and (vii)
institutional money market funds investing principally in obligations
permitted in clauses (i)-(vi) above.
"C/D Assessment Rate": for any day as applied to any ABR Loan,
the annual assessment rate in effect on such day which is payable by a
member of the Bank Insurance Fund classified as well-capitalized and
within supervisory subgroup "B" (or a comparable successor assessment
risk classification) within the meaning of 12 C.F.R. 'SS' 327.3(d) (or
any successor provision) to the Federal Deposit Insurance Corporation
(or any successor) for such Corporation's (or such successor's)
insuring time deposits at offices of such institution in the United
States.
"C/D Reserve Percentage": for any day as applied to any ABR
Loan, that percentage (expressed as a decimal) which is in effect on
such day, as prescribed by the Board, for determining the maximum
reserve requirement for a Depositary Institution (as defined in
Regulation D of the Board) in respect of new non-personal time deposits
in Dollars of $100,000 or more having a maturity of 30 days or more.
"Change in Control": (i) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act), other than one or more
Permitted Holders in the aggregate or an ESOP, is or becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of more than 35% of the total voting power of
the Voting Stock of Holdings at any time that the Permitted Holders in
the aggregate "beneficially own" (as so defined), directly or
indirectly, in the aggregate a lesser percentage of the total voting
power of the Voting Stock of Holdings than such other person and do not
have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors of
Holdings (for the purposes of this clause (i), such other person shall
be deemed to beneficially own any Voting Stock of a specified
corporation held by a parent corporation, if such other person
beneficially owns (as so defined), directly or indirectly, more than
35% of the total voting power of the Voting Stock of such parent
corporation and the Permitted Holders in the aggregate beneficially own
(as so defined), directly or indirectly, in the aggregate a lesser
percentage of the total voting power of the Voting Stock of such parent
corporation and do not have the right or ability by voting power,
contract or otherwise to elect or designate for election a majority of
the board of directors of such parent corporation); (ii) during any
period of two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors of Holdings (together
with any new directors whose election by such Board of Directors or
whose nomination for election by the shareholders of Holdings was
approved by either (A) a vote of 66-2/3% of the directors of Holdings
then still in office who were either directors at the beginning of such
period or whose election or nomination for election was previously so
approved or (B) a vote of Permitted Holders who beneficially own,
directly or indirectly, a majority in the aggregate of the total voting
power of the Voting Stock of Holdings) cease for any reason to
constitute a majority of the Board of Directors of Holdings then in
office; or (iii) the occurrence of a "change of control" (however
denominated) under
11
and as defined in any credit agreement, indenture or similar
agreement to which Holdings or any of its Subsidiaries is a party
providing for commitments of credit in excess of $10,000,000, if
the occurrence of such change of control results in a default or event
of default under such credit agreement, indenture or similar agreement
pursuant to the terms thereof (and such default or event of default has
not been cured within any applicable period set forth in such credit
agreement, indenture or similar agreement), or the lenders, noteholders
or other creditors have a right to have their loans, notes or other
extensions of credit repaid or repurchased by the Company or such
Subsidiary prior to the stated maturity thereof by reason of such
change of control (and such repayment or repurchase has not occurred in
accordance with such credit agreement, indenture or similar agreement).
"Chase": The Chase Manhattan Bank.
"Chase Canada": The Chase Manhattan Bank of Canada.
"Closing Date": as defined in subsection 5.2.
"Code": the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral": all assets of the Loan Parties, now owned or
hereafter acquired, upon which a Lien is purported to be created by any
Security Document.
"Collateral Agent": Chase in its capacity as collateral agent
under the Security Documents (other than the Canadian Security
Documents).
"Commitment": as to any Lender, the sum of the Revolving
Credit Commitment and the Canadian Revolving Credit Commitment of such
Lender; the Revolving Credit Commitments and the Canadian Revolving
Credit Commitments, collectively, the "Commitments".
"Commitment Fee Rate": 1/2 of 1% per annum.
"Commitment Period": the period from and including the
Effective Date to the Termination Date.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Company within
the meaning of Section 4001 of ERISA or is part of a group which
includes the Company and which is treated as a single employer under
Section 414(b) or (c) of the Code.
"Company": as defined in the preamble to this Agreement.
"Company Obligations": the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of
the Loans and Reimbursement
12
Obligations and interest accruing after the filing of any petition
in bankruptcy, or the commencement of any insolvency, reorganization
or like proceeding, relating to the Company, whether or not a
claim for post-filing or post-petition interest is allowed in
such proceeding) the Loans made to the Company and all other
obligations and liabilities of the Company to the Administrative Agent,
the Canadian Administrative Agent or to any Lender (or, in the case of
Interest Rate Protection Arrangements or Currency Agreements, any
Affiliate of any Lender), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter
incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, the Letters of Credit, any Interest
Rate Protection Arrangement or Currency Agreement entered into with any
Lender or any Affiliate of any Lender or any other document made,
delivered or given in connection herewith or therewith, whether on
account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation, all fees,
charges and disbursements of counsel to the Administrative Agent, the
Canadian Administrative Agent or to any Lender that are required to be
paid by the Company pursuant hereto) or otherwise.
"Company Pro Forma Balance Sheet": as defined in subsection
4.1(b).
"Compliance Certificate": a certificate substantially in the
form of Exhibit B.
"Confidential Information Memorandum": the Confidential
Information Memorandum dated March 1999 prepared in connection with the
Facilities.
"Consolidated Cash Flow": for any period, the aggregate of (i)
Consolidated Net Income for such period plus (ii) Consolidated Interest
Expense deducted in computing such Consolidated Net Income plus (iii)
Consolidated Tax Expense deducted in computing such Consolidated Net
Income plus (iv) Consolidated Non-Cash Charges deducted in computing
such Consolidated Net Income minus (v) the net gain incurred in the
retirement of Indebtedness plus (vi) the net loss incurred in the
retirement of Indebtedness minus (vii) Consolidated Non-Cash Gains
included in computing such Consolidated Net Income minus (viii) cash
gains from sales of assets (other than inventory) to the extent
included in computing such Consolidated Net Income plus (ix) cash
losses from sales of assets (other than inventory) to the extent
deducted in computing such Consolidated Net Income.
"Consolidated Interest Expense": for any period, the aggregate
of the interest expense of the Company and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP,
including amortization of original issue discount and the interest
portion of any deferred payment obligations, excluding, to the extent
included in computing interest expense, any amortization or write-off
of debt issuance costs.
"Consolidated Net Income": for any period, net income of the
Company and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP, but excluding (i) any item
classified as an extraordinary, unusual or nonrecurring
13
gain, loss or charge, including, but not limited to, any such item
related to, or arising in connection with, the Spin-Off, (ii) any
amortization of deferred financing costs, (iii) all deferred
financing costs written off and premiums paid in connection with
any early extinguishment of Indebtedness and (iv) non-cash gains
or losses resulting from fluctuations in currency exchange rates.
"Consolidated Net Worth": as of the date of determination, all
items which in accordance with GAAP would be included under
shareholders' equity on a consolidated balance sheet of the Company and
its Subsidiaries at such date.
"Consolidated Non-Cash Charges": for any period, the aggregate
depreciation, amortization and other non-cash expenses of the Company
and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Non-Cash Gains": for any period, the aggregate
non-cash revenue items of the Company and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP.
"Consolidated Tangible Assets": as of any date of
determination, the total assets, less goodwill and other intangibles,
shown on the balance sheet of the Company and its Subsidiaries as of
the most recent date for which such a balance sheet has been delivered
pursuant to subsection 6.2(b), determined on a consolidated basis in
accordance with GAAP.
"Consolidated Tax Expense": for any period, the aggregate of
the U.S. federal, state and local income tax expense and foreign tax
expense of the Company and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
"Consolidated Total Indebtedness": as of the date of
determination, all Indebtedness and Guarantee Obligations of the
Company and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP, except that Indebtedness and Guarantee
Obligations of the Company and its Subsidiaries in respect of
reclamation bonds, performance bonds, letters of credit (other than
Letters of Credit) and surety bonds (in each of the foregoing cases,
except to the extent financed by Indebtedness under this Agreement)
required by the applicable statutes or laws of the relevant
jurisdiction or by relevant Government Authorities (or, in the case of
such letters of credit, issued for insurance purposes) shall be
excluded for purposes of determining Consolidated Total Indebtedness.
"Contract Period": the term of a B/A selected by the Canadian
Borrower in accordance with subsection 2.3 commencing on the Borrowing
Date, rollover date or conversion date, as the case may be, of such B/A
and expiring on a Business Day which shall be either 30 days, 60 days,
90 days or 180 days thereafter, in all cases subject to availability,
provided that no Contract Period shall extend beyond the Termination
Date.
14
"Contractual Obligation": as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
other undertaking to which such Person is a party or by which it or
any of its property is bound.
"CSI": Chase Securities Inc.
"Currency Agreement": with respect to any Person, any foreign
exchange contract, currency swap agreement or other similar agreement
or arrangement designed to protect such Person or any of its
Subsidiaries against fluctuations in currency values.
"Default": any of the events specified in Section 8, whether
or not any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.
"Designated Issuer": Chase Manhattan Bank Delaware, a
Delaware banking corporation, in its individual capacity.
"Discount Proceeds": for any B/A, an amount (rounded to the
nearest whole cent, and with one-half of one cent being rounded up)
calculated on the applicable Borrowing Date, rollover date or
conversion date, as the case may be, by multiplying:
(i) the face amount of the B/A; by
(ii) the quotient of one divided by the sum of one plus
the product of:
1. the Discount Rate (expressed as a decimal) applicable
to such B/A, and
2. a fraction, the numerator of which is the number of
days in the Contract Period of the B/A (inclusive of
the first day and exclusive of the last day) and the
denominator of which is 365.
with such quotient being rounded up or down to the fifth decimal place
and .000005 being rounded up.
"Discount Rate": with respect to any issue of B/As with the
same maturity date, (a) for a Canadian Revolving Credit Lender that is
a Canadian Schedule I Lender, (i) the average B/A discount rate for
the appropriate term as quoted on Reuters Screen CDOR Page determined
at or about 10:00 A.M. (Toronto time) on that day or (ii) if the
discount rate for a particular term is not quoted on Reuters Screen
CDOR Page, the arithmetic average of the actual discount rates for
bankers' acceptances for the appropriate term accepted by the Schedule
I Reference Banks at or about 10:00 A.M. (Toronto time) on that day
and (b) for a Canadian Revolving Credit Lender that is a Canadian
Schedule II Lender, the actual discount rates applicable to B/As for
the appropriate term accepted by Chase Canada but not to exceed the
actual rate of discount determined in accordance with clause (a) above
plus 0.10%.
15
"Disposition": with respect to any assets or rights, any
sale, lease, assignment, conveyance, transfer or other disposition
thereof (including, without limitation, by way of a sale and
leaseback).
"Dollar Equivalent Amount": with respect to (i) any Canadian
Revolving Credit Loan or Letter of Credit denominated in C$ or any B/A
or any payment obligation in respect thereof, the equivalent amount in
Dollars of such Canadian Revolving Credit Loan, Letter of Credit, B/A
or payment obligation as determined by the Canadian Administrative
Agent using the spot rate at which The Bank of Canada would, on such
date at or about 12:00 Noon (Toronto time), be prepared to sell a
similar amount of Canadian Dollars in Toronto (and if such date is not
a Business Day, on the immediately preceding Business Day) and (ii)
any amount denominated in Dollars, such amount in Dollars.
"Dollars" and "$": dollars in lawful currency of the United
States of America.
"Domestic Subsidiary": any Subsidiary organized under the
laws of the United States or any jurisdiction therein or thereof.
"Effective Date": as defined in subsection 5.1.
"Environmental Laws": any and all foreign, Federal, state,
provincial, local or municipal laws, rules, orders, regulations,
statutes, ordinances, codes, guidelines, decrees, requirements of any
Governmental Authority or other Requirements of Law (including common
law) regulating, relating to or imposing liability or standards of
conduct concerning protection of health, safety or the environment, as
now or may at any time hereafter be in effect.
"Equity Interests": Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital
Stock).
"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ESOP": an employee stock ownership plan for the benefit of
the Company's or a Subsidiary's employees.
"Eurocurrency Reserve Requirements": for any day as applied
to a Eurodollar Loan, the aggregate (without duplication) of the rates
(expressed as a decimal) of reserve requirements in effect on such day
(including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board or other
Governmental Authority having jurisdiction with respect thereto)
dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D
of the Board) maintained by a member bank of the Federal Reserve
System.
16
"Eurodollar Base Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, (a) in the case of
the Revolving Credit Loans, the rate per annum equal to the rate at
which Chase is offered Dollar deposits at or about 10:00 A.M., New
York City time, and (b) in the case of the Canadian Revolving Credit
Loans, the rate per annum equal to the rate at which Chase Canada is
offered Dollar deposits at or about 10:00 A.M., Toronto time, in each
case two Business Days prior to the beginning of such Interest Period
in the interbank eurodollar market where the eurodollar and foreign
currency and exchange options in respect of its Eurodollar Loans are
then being conducted for delivery on the first day of such Interest
Period for the number of days comprised therein and in an amount
comparable to the amount of its Eurodollar Loan to be outstanding
during such Interest Period.
"Eurodollar Loans": Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, (i) in the case of a
Eurodollar Loan made by a Canadian Revolving Credit Lender, the
Eurodollar Base Rate, and (ii) otherwise, a rate per annum determined
for such day in accordance with the following formula (rounded upward
to the nearest 1/100th of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar
Loans the then current Interest Periods with respect to all of which
begin on the same date and end on the same later date (whether or
not such Loans shall originally have been made on the same day).
"Event of Default": any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.
"Exchange Act": the Securities Exchange Act of 1934, as
amended.
"Excluded Issuer": any Subsidiary of the Company that is a
direct or indirect Subsidiary of a Foreign Subsidiary, a Foreign
Subsidiary Holding Company or Soda Ash Partners.
"Existing Credit Agreement": the Credit Agreement dated as
June 15, 1998 among Holdings, the lenders party thereto, Chase, as
administrative agent, and the other agents named therein.
"Extensions of Credit": the collective reference to the
Revolving Extensions of Credit and the Canadian Revolving Extensions
of Credit.
17
"Facility": each of (a) the Revolving Credit Commitments and
the extensions of credit made thereunder (the "Revolving Credit
Facility") and (b) the Canadian Revolving Credit Commitments and the
extensions of credit made thereunder (the "Canadian Revolving Credit
Facility").
"Federal Funds Effective Rate": as defined in the definition
of "ABR."
"Financing Lease": any lease of property, real or personal,
the obligations of the lessee in respect of which are required in
accordance with GAAP to be capitalized on a balance sheet of the
lessee.
"Foreign Subsidiary": any Subsidiary other than a Domestic
Subsidiary.
"Foreign Subsidiary Holding Company": any Domestic Subsidiary
that has no material assets other than the Capital Stock or other
securities of one or more Foreign Subsidiaries or other Foreign
Subsidiary Holding Companies, and other assets relating solely to an
ownership interest in such Capital Stock or other securities.
"Form 10 Filing": the Registration Statement on Form 10 (File
No. 001-14789), together with all Exhibits thereto, initially filed by
GenTek with the Securities and Exchange Commission on on January 27,
1999, as amended by Amendment No. 1 filed with the Securities and
Exchange Commission on March 22, 1999 and by Amendment No. 2 filed
with the Securities and Exchange Commission on April 8, 1999, with
respect to the Spin-Off.
"GAAP": generally accepted accounting principles in the
United States of America in effect from time to time.
"GC Canada Senior Notes": the 9.09% Senior Notes of the
Canadian Borrower due May 20, 1999 in the original principal amount of
$52,000,000, as the same may be amended, modified, supplemented,
replaced or refinanced from time to time.
"GenTek": as defined in the recitals hereto.
"GenTek Credit Facility": the Credit Agreement, dated as of
the date hereof, among GenTek, Noma Acquisition Corp., The Chase
Manhattan Bank, as administrative agent, the Lenders parties thereto
and the other agents parties thereto.
"Governmental Authority": any nation or government, any
state, province or other political subdivision thereof and any entity
(including the National Association of Insurance Commissioners or a
Minister of the Crown) exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.
"Guarantee and Collateral Agreement": the Guarantee and
Collateral Agreement to be executed and delivered by Intermediate
Holdings, the Company and each
18
Subsidiary Guarantor, substantially in the form of Exhibit E-1, as
the same may be amended, supplemented or otherwise modified from
time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another
Person (including, without limitation, any bank under any letter of
credit) to induce the creation of which the guaranteeing person has
issued a reimbursement, counterindemnity or similar obligation, in
either case guaranteeing or in effect guaranteeing any Indebtedness,
leases, dividends or other obligations (the "primary obligations") of
any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation
of the guaranteeing person, whether or not contingent, (i) to purchase
any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for
the purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the owner of
any such primary obligation against loss in respect thereof; provided,
however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount
equal to the stated or determinable amount of the primary obligation
in respect of which such Guarantee Obligation is made and (b) the
maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for
which such guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person's maximum reasonably anticipated
liability in respect thereof as determined by the Company in good
faith.
"Hazardous Materials": any hazardous materials, hazardous
wastes, hazardous constituents, pollutants, contaminants, waste or
hazardous or toxic substances defined or regulated as such in or under
any Environmental Law, and including, without limitation, petroleum
products (including crude oil or any fraction thereof), asbestos in
friable form, polychlorinated biphenyls, and urea formaldehyde
insulation.
"Holdings": as defined in the recitals to this Agreement.
"Indebtedness": of any Person at any date, (a) all
indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services (other than current trade
liabilities incurred in the ordinary course of business and payable in
accordance with customary practices), (b) any other indebtedness of
such Person which is evidenced by a note, bond, debenture or similar
instrument, (c) the face amount of all letters of credit issued for
the account of such Person and, without duplication, all drafts drawn
thereunder, (d) all obligations of such Person under Financing Leases,
(e) all
19
obligations of such Person in respect of acceptances issued or
created for the account of such Person and (f) the lesser of (i) all
liabilities secured by any Lien on any property owned by such Person
when such Person has not assumed or otherwise become liable for the
payment thereof and (ii) the fair market value of any such property;
provided that Indebtedness shall not be deemed to include any
indebtedness which has been "economically defeased" or "in-substance
defeased" within the meaning of and in accordance with Standard No. 76
of the Financial Accounting Standards Board.
"Industrial Chemicals Business": as defined in the recitals
to this Agreement.
"Insolvency": with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section
4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Interest Coverage Ratio": as at the last day of any fiscal
quarter of the Company, the Pro Forma Ratio of (a) Consolidated Cash
Flow for the period of four fiscal quarters ending on such day to (b)
Consolidated Interest Expense for the period of four fiscal quarters
ending on such day.
"Interest Payment Date": (a) as to any ABR Loan, Canadian
Prime Rate Loan or Canadian Base Rate Loan, the last day of each
March, June, September and December to occur while such Loan is
outstanding (or if such day is not a Business Day, the next succeeding
Business Day), (b) as to any Eurodollar Loan having an Interest Period
of three months or less, the last day of such Interest Period, (c) as
to any Eurodollar Loan having an Interest Period longer than three
months, each day which is three months, or a whole multiple thereof,
after the first day of such Interest Period and the last day of such
Interest Period, (d) as to any Loan (other than any ABR Loan, Canadian
Prime Rate Loan or Canadian Base Rate Loan or an Acceptance), the date
on which such Loan is converted into another Type of Loan or on which
any repayment or prepayment is made in respect thereof, (e) as to any
Revolving Credit Loan, the Termination Date or such earlier date as
the Revolving Credit Commitments shall terminate as provided herein
and (f) as to any Canadian Revolving Credit Loan, the Termination Date
or such earlier date as the Canadian Revolving Credit Commitments
shall terminate as provided herein.
"Interest Period": with respect to any Eurodollar Loan:
(i) initially, the period commencing on the borrowing
or conversion date, as the case may be, with respect to such
Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the relevant Borrower in its
notice of borrowing or notice of conversion, as the case may
be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such
Eurodollar Loan and ending one,
20
two, three or six months thereafter, as selected by the
relevant Borrower by irrevocable notice to the Applicable
Agent not less than three Business Days prior to the last
day of then current Interest Period with respect thereto;
provided that, each of the foregoing provisions relating to Interest
Periods is subject to the following:
(1) if any Interest Period would otherwise end on a day
that is not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless the
result of such extension would be to carry such Interest
Period into another calendar month in which event such
Interest Period shall end on the immediately preceding
Business Day;
(2) any Interest Period that would otherwise extend
beyond the Termination Date shall end on the Termination
Date;
(3) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(4) the relevant Borrower shall select Interest Periods
so as not to require a payment or prepayment of any
Eurodollar Loan during an Interest Period for such Loan.
"Interest Rate Protection Arrangement": as defined in the
definition of "Interest Rate Protection Obligations" below.
"Interest Rate Protection Obligations": the obligations of
any Person pursuant to any arrangement (an "Interest Rate Protection
Arrangement") with any other Person whereby, directly or indirectly,
such Person is entitled to receive from time to time periodic payments
calculated by applying either a floating or a fixed rate of interest
on a stated notional amount in exchange for periodic payments made by
such Person calculated by applying a fixed or a floating rate of
interest on the same notional amount and shall include without
limitation, interest rate swaps, caps, floors, collars and similar
agreements.
"Intermediate Holdings": as defined in the recitals hereto.
"Investment": as defined in subsection 7.10.
"IRS Ruling": the private letter ruling of the Internal
Revenue Service, dated March 16, 1999 and received by Holdings on
March 18, 1999, to the effect that the Spin-Off generally will be tax
free to Holdings and its shareholders, as more fully described in the
Form 10 Filing.
21
"Issuing Bank": (a) with respect to any Letter of Credit
issued under the Revolving Credit Commitments, Chase or any Affiliate
thereof, including the Designated Issuer, or any successor thereto,
each in its capacity as issuer of any such Letter of Credit, and (b)
with respect to any Letter of Credit issued under the Canadian
Revolving Credit Commitments, a Canadian Revolving Credit Lender to be
agreed upon by the Canadian Administrative Agent and the Canadian
Borrower, or any successor thereto, in such Lender's (or such
successor's, as the case may be) capacity as issuer of any such Letter
of Credit.
"L/C Commitment": $15,000,000, as such amount may be reduced
from time to time in accordance with this Agreement.
"L/C Fee Payment Date": the last day of each March, June,
September and December.
"L/C Obligations": at any time, an amount equal to the Dollar
Equivalent Amount of the sum of (a) the aggregate then undrawn and
unexpired amount of then outstanding Letters of Credit and (b) the
aggregate amount of drawings under Letters of Credit which have not
then been reimbursed pursuant to subsection 3.5(a).
"Lenders": as defined in the preamble to this Agreement.
"Letters of Credit": as defined in subsection 3.1(a).
"Leverage Ratio": as at the last day of any fiscal quarter of
the Company, the Pro Forma Ratio of (a) Consolidated Total
Indebtedness as at such day to (b) Consolidated Cash Flow for the
period of four fiscal quarters ending on such day.
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or
other security interest or any preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title
retention agreement and any Financing Lease having substantially the
same economic effect as any of the foregoing).
"Loan Documents": the collective reference to this Agreement,
the Notes, the Applications and the Security Documents.
"Loan Parties": Intermediate Holdings, the Borrowers and each
of their respective Subsidiaries party to a Loan Document.
"Loans": any loan made by any Lender pursuant to this
Agreement.
"Majority Facility Lenders": with respect to any Facility,
the holders of more than 50% of the aggregate unpaid principal amount
of the Total Revolving Extensions of Credit or Total Canadian
Revolving Extensions of Credit, as the case may be,
22
outstanding under such Facility (or prior to any termination of a
Facility, the holders of more than 50% of the Commitments under such
Facility).
"Management Agreement": the Amended and Restated Management
Agreement dated as of April 30, 1999 between Holdings and Latona
Associates Inc., as such agreement may be amended, supplemented or
otherwise modified or replaced from time to time in accordance with
subsection 7.11.
"Material Adverse Effect": a material adverse effect on (a)
the business, operations, property, condition (financial or otherwise)
or prospects of the Company and its Subsidiaries taken as a whole, or
(b) the validity or enforceability of this Agreement, any of the
Notes, any Application or any of the other Loan Documents or the
rights or remedies of the Administrative Agent, the Canadian
Administrative Agent or the Lenders hereunder or thereunder.
"Material Foreign Subsidiary": any Material Subsidiary
organized under the laws of any jurisdiction (other than the United
States or any jurisdiction therein).
"Material Subsidiary": at any date of determination, any
Subsidiary of the Company (i) the gross revenues of which aggregated
at least 5% of the aggregate gross revenues of the Company and its
Subsidiaries for the most recent period of twelve consecutive months
ending prior to such date or (ii) the book value of the assets of
which aggregated at least 10% of the aggregate book value of the
assets of the Company and its Subsidiaries as at the last day of the
most recently ended fiscal month of the Company.
"Maximum Canadian Revolving Credit Commitments": $60,000,000.
"Mineral Agreement": an agreement between the Company or a
Subsidiary of the Company and a customer of the Company or such
Subsidiary for the purpose of mining minerals pursuant to which the
Company or such Subsidiary contributes minerals leases to such Person,
or agrees to mine minerals for such Person, in the ordinary course of
business.
"Mineral Rights Exchange": any sale, conveyance, transfer or
other disposition, in the ordinary course of business of the Company
and its Subsidiaries, of leases, licenses or other interests in
mineral rights in exchange for other leases, licenses or interests in
mineral rights to be used by the Company and its Subsidiaries and
having an equivalent fair market value (taking into account the value
to the Company and its Subsidiaries of the location and quality of the
new mineral rights relative to the existing mineral rights).
"Moody's": Moody's Investors Services, Inc.
23
"Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) when used in respect of any Asset
Sale or Recovery Event by or with respect to the Company or any of its
Subsidiaries, the gross proceeds received by such Person in Cash and
Cash Equivalents (including payment in respect of deferred payment
obligations but only when received in the form of Cash and Cash
Equivalents), from such Asset Sale or Recovery Event less (i) all
legal, accounting, title, recording and transfer tax expenses,
commissions and other customary fees and expenses incurred, and all
other federal, state and local taxes assessed, in connection
therewith, (ii) the principal amount of, premium, if any, and interest
on, any Indebtedness (other than the Loans and L/C Obligations) which
is secured by the assets which are the subject of such Asset Sale or
Recovery Event and which is required to be repaid in connection with
such Asset Sale or Recovery Event and (iii) amounts to be provided by
such Person as a reserve, in accordance with GAAP, against any
liabilities associated with any such Asset Sale or Recovery Event and
retained by such Person after such Asset Sale or Recovery Event,
including, without limitation, pension and other post-employment
benefit liabilities and liabilities related to environmental matters
or against any indemnification obligations associated with such Asset
Sale or Recovery Event, provided that any such net proceeds received
by Soda Ash Partners or any Subsidiary of Soda Ash Partners shall
constitute Net Cash Proceeds only when and to the extent such net
proceeds are distributed to the Company, and (b) when used in respect
of the incurrence of Indebtedness by the Company or any of its
Subsidiaries, the gross proceeds received by such Person in Cash and
Cash Equivalents from such incurrence less all legal expenses,
commissions and other fees and expenses incurred or to be incurred in
connection therewith.
"NHO Canada": NHO Canada Holding, Inc., a Delaware
corporation.
"NHO Distribution": as defined in the recitals hereto.
"1998 10-K": Holdings' annual report on Form 10-K filed with
the Securities and Exchange Commission for its fiscal year ended
December 31, 1998.
"Non-Excluded Taxes": as defined in subsection 2.18.
"Notes": the collective reference to any promissory notes
evidencing the Loans.
"Obligations": the collective reference to the Canadian
Borrower Obligations and the Company Obligations.
"Participant": as defined in subsection 10.6(b).
"Participating Bank": as applicable, (a) any Revolving Credit
Lender (other than the applicable Issuing Bank) with respect to its
participating interest in each Letter of
24
Credit issued under the Revolving Credit Commitments; provided
that each Revolving Credit Lender (including the Issuing Bank,
if a Lender) shall be deemed to be a Participating Bank with
respect to any Letter of Credit issued by the Designated Issuer
and (b) any Canadian Revolving Credit Lender (other than the
applicable Issuing Bank) with respect to its participation
in each Letter of Credit issued under the Canadian Revolving
Credit Commitments.
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Permitted Acquisition": any acquisition made pursuant to
subsection 7.10(g).
"Permitted Designee": with respect to any Permitted Holder
(i) a spouse or a child (in the case of an individual) of such
Permitted Holder, (ii) any trust for the benefit of such Permitted
Holder or a spouse or child of such Permitted Holder, (iii) in the
event of the death or incompetence of such Permitted Holder, such
Permitted Holder's estate, heirs, executor, administrator, committee
or other court appointed representative, (iv) any foundation or not
for profit organization established by a Permitted Holder or (v) any
Person so long as a Permitted Holder is the "beneficial owner" (as
defined in clause (i) of the definition of "Change in Control") of at
least 51% of the Voting Stock of such Person.
"Permitted Holders": Paul M. Meister, Paul M. Montrone,
Richard R. Russell, John Kehoe, Jr. and their Permitted Designees.
"Permitted Investments": Investments permitted by subsection
7.10.
"Person": an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan which
is covered by ERISA and in respect of which the Company or a Commonly
Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Pledged Stock": as defined in the Guarantee and Collateral
Agreement.
"Pricing Grid": the pricing grid attached hereto as Annex A.
"Productive Assets": assets (including Capital Stock of a
Person that directly or indirectly owns assets) of a kind used or
usable in the Company's business, or related to such business, as
conducted on the date of the relevant Asset Sale or Recovery Event.
"Pro Forma Ratio": as used in the definitions of "Interest
Coverage Ratio", "Leverage Ratio", "Pricing Ratio" and "Senior
Leverage Ratio", the ratio indicated
25
determined using Consolidated Cash Flow, Consolidated
Interest Expense, Funded Debt and Consolidated Total Indebtedness,
as the case may be, each calculated (as provided herein as though
this Agreement had been effective at such time) for the
period indicated giving pro forma effect (as determined in good
faith by the Chief Financial Officer of the Company, based on
reasonable assumptions) to any of the following transactions that
shall have occurred after the beginning of such period as if such
transaction had occurred at the beginning of such period: (a) the
Spin-Off and the Refinancing Transactions; (b) any transaction
pursuant to which any Person becomes a Subsidiary of the Company or
the Company or any Subsidiary acquires all or substantially all of the
assets of any Person; or (c) any transaction of the type described in
the preceding clauses (a) and (b) by any Person that, since the
beginning of such period became a Subsidiary of the Company or was
merged with or into the Company or any Subsidiary of the Company.
"Properties": as defined in subsection 4.16.
"Quarterly Date": the last Business Day of each March, June,
September and December to occur while any Loan is outstanding.
"Reallocation Date": as defined in subsection 2.4(a).
"Reallocation Notice": as defined in subsection 2.4(a).
"Recovery Event": any settlement of or payment in excess of
$500,000 in any transaction or series of related transactions in
respect of any property or casualty insurance claim or any
condemnation proceeding relating to any asset of the Company or any of
its Subsidiaries.
"Redeemable Stock": any class or series of Capital Stock that
(i) by its terms or otherwise is required to be redeemed prior to May
15, 2004, (ii) is redeemable at the option of the holder thereof at
any time prior to May 15, 2004 or (iii) is exchangeable into any
Capital Stock described in clause (i) or (ii) above.
"Refinancing Transactions": the collective reference to (a)
the issue and sale of the Senior Subordinated Notes, (b) the
distribution by the Company to Holdings of a portion of the proceeds
of the issue and sale of the Senior Subordinated Notes, (c) the
initial borrowing hereunder by the Canadian Borrower and the repayment
in full of the GC Canada Senior Notes with the proceeds of such
borrowing, (d) the initial borrowing by GenTek under the GenTek Credit
Facility, (e) the loan by GenTek to GCC of the proceeds of such
borrowing and the repayment in full of outstanding amounts due
Holdings from GCC and (f) the repayment in full by Holdings (or the
applicable Subsidiary, as the case may be) of all amounts owing under,
and the termination of, the Existing Credit Agreement and all other
long-term Indebtedness of the Company and its Subsidiaries (other than
Indebtedness permitted to exist under subsection 7.2), and the
termination of all Liens thereunder (other than Liens permitted to
exist under subsection 7.3).
26
"Register": as defined in subsection 10.6(d).
"Regulation U": Regulation U of the Board as in effect from
time to time.
"Reimbursement Obligation": the obligation of each Borrower
to reimburse the Issuing Banks pursuant to subsection 3.5(a) for
amounts drawn under Letters of Credit.
"Reinvestment Deferred Amount": with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by the
Company or any of its Subsidiaries in connection therewith which are
not applied to reduce the Total Commitments pursuant to subsection
2.9(d) as a result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in
respect of which the Company has delivered a Reinvestment Notice.
"Reinvestment Notice": a written notice executed by a
Responsible Officer stating that no Event of Default has occurred and
is continuing and that the Company (directly or indirectly through a
Subsidiary) intends and expects to use all or a specified portion of
the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire
Productive Assets.
"Reinvestment Prepayment Amount": with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto
less any amount expended prior to the relevant Reinvestment Prepayment
Date to acquire Productive Assets.
"Reinvestment Prepayment Date": with respect to any
Reinvestment Event, the earlier of (a) the date occurring 360 days
after such Reinvestment Event and (b) the date on which the Company
shall have determined not to acquire Productive Assets with all or any
portion of the relevant Reinvestment Deferred Amount.
"Related Business": any business that is similar or
reasonably related to any business engaged in by the Company or any
Subsidiary, or any other business complementary or incidental thereto,
or a reasonably related development thereof.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of
Section 4241 of ERISA.
"Reportable Event": any of the events set forth in Section
4043(b) of ERISA, other than those events as to which the thirty day
notice period is waived under subsections .27, .28, .29, .30, .31,
.32, .34 or .35 of PBGC Reg. 'SS' 4043.
"Required Lenders": at any time, Lenders the Total Credit
Percentages of which aggregate more than 50%.
"Requirement of Law": as to any Person, the certificate of
incorporation and by-laws or other organizational or governing
documents of such Person, and any law,
27
treaty, rule or regulation or determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which such
Person or any of its property is subject.
"Responsible Officer": the chief executive officer, the
president or any vice president of a Borrower or Holdings or, with
respect to financial matters, the chief financial officer of a
Borrower or Holdings.
"Restricted Payments": as defined in subsection 7.8.
"Revolving Credit Commitment": as to any Lender, the
obligation of such Lender, if any, to make Revolving Credit Loans to
the Company and participate in Letters of Credit issued for the
account of the Company, in an aggregate principal and/or face amount
not to exceed the amount set forth under the heading "Revolving Credit
Commitment" opposite such Lender's name on Schedule I, as the same may
be changed from time to time pursuant to the terms hereof.
"Revolving Credit Lender": each Lender which has a Revolving
Credit Commitment or which is the holder of Revolving Credit Loans.
"Revolving Credit Loans": as defined in subsection 2.1(a).
"Revolving Credit Percentage": as to any Revolving Credit
Lender at any time, the percentage which such Lender's Revolving
Credit Commitment then constitutes of the Total Revolving Credit
Commitments (or, at any time after the Revolving Credit Commitments
shall have expired or terminated, the percentage which the aggregate
principal amount of such Lender's Revolving Credit Loans then
outstanding constitutes of the aggregate principal amount of the
Revolving Credit Loans then outstanding).
"Revolving Extensions of Credit": as to any Revolving Credit
Lender at any time, an amount equal to the sum of (a) the aggregate
principal amount of all Revolving Credit Loans made by such Lender
then outstanding, and (b) such Lender's Revolving Credit Percentage of
the L/C Obligations then outstanding under the Revolving Credit
Commitments.
"Schedule I Reference Banks": The Bank of Nova Scotia.
"Security Documents": the collective reference to the
Guarantee and Collateral Agreement, the Canadian Guarantee and
Collateral Agreement, the Canadian Mortgages and all other documents
or instruments hereafter delivered to or for the benefit of the
Administrative Agent, the Canadian Administrative Agent or the
Collateral Agent and the Lenders, including the Canadian Security
Documents, granting a Lien on any asset or assets of any Person to
secure the obligations and liabilities of the Borrowers hereunder,
under the Notes and/or under any of the other Loan Documents or to
secure any guarantee of any such obligations and liabilities.
28
"Senior Leverage Ratio": as at the last day of any fiscal
quarter of the Company, the Pro Forma Ratio of (a) Consolidated Total
Indebtedness, less the aggregate outstanding principal amount of (i)
the Senior Subordinated Notes (or Refinancing Indebtedness in respect
thereof, as the case may be) and (ii) any other Indebtedness permitted
under subsection 7.2 constituting "Pari Passu Debt" or "Subordinated
Debt" as defined in the Senior Subordinated Note Indenture as in
effect on the Closing Date, as at such day to (b) Consolidated Cash
Flow for the period of four fiscal quarters ending on such day.
"Senior Subordinated Note Indenture": the Indenture entered
into by the Company in connection with the issuance of the Senior
Subordinated Notes, together with all instruments and other agreements
entered into by the Company in connection therewith, as the same may
be amended, supplemented or otherwise modified from time to time in
accordance with subsection 7.12.
"Senior Subordinated Notes": the subordinated notes of the
Company issued on the Closing Date pursuant to the Senior Subordinated
Note Indenture.
"Separation": as defined in the recitals hereto.
"Separation Agreement": as defined in the recitals hereto.
"Single Employer Plan": any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.
"Soda Ash Parent Agreement": the Amended and Restated Parent
Guaranty and Transfer Agreement dated June 30, 1992 and executed by
New Hampshire Oak, Inc., ACI International Limited and TOSOH America,
Inc., as the same may be amended, modified or supplemented from time
to time.
"Soda Ash Partners": General Chemical (Soda Ash) Partners, a
Delaware general partnership.
"Soda Ash Partnership Agreement": the Second Amended and
Restated Partnership Agreement of General Chemical (Soda Ash)
Partners, dated June 30, 1992 and executed by General Chemical
Corporation, the Andover Group, Inc and TOSOH Wyoming, Inc., setting
forth the respective rights and duties of the general partners of Soda
Ash Partners, as such agreement may be amended, supplemented, replaced
or otherwise modified from time to time in accordance with subsection
7.12.
"Solvent": when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "present fair
saleable value" of the assets of such Person will, as of such date,
exceed the amount of all "liabilities of such Person, contingent or
otherwise", as of such date, as such quoted terms are determined in
accordance with applicable federal and state laws governing
determinations of the
29
insolvency of debtors, (b) the present fair saleable value of the
assets of such Person will, as of such date, be greater than
the amount that will be required to pay the liability of such
Person on its debts as such debts become absolute and matured, (c)
such Person will not have, as of such date, an unreasonably small
amount of capital with which to conduct its business, and (d) such
Person will be able to pay its debts as they mature. For purposes of
this definition, (i) "debt" means liability on a "claim", and (ii)
"claim" means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured or (y) right to an equitable remedy for breach of
performance if such breach gives rise to a right to payment, whether
or not such right to an equitable remedy is reduced to judgment,
fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.
"Spin-Off": as defined in the recitals hereto.
"Spin-Off Documents": the collective reference to (i) the
Separation Agreement and (ii) the Ancillary Agreements (as defined in
the Separation Agreement as in effect on the date hereof), as the
same may be amended, modified or supplemented from time to time.
"Spin-Off Transactions": as defined in the recitals to this
Agreement.
"S&P": Standard & Poor's Ratings Services Group, a division
of The McGraw-Hill Companies, Inc.
"Stamping Fee": a fee payable in C$ by the Canadian Borrower
to the Canadian Administrative Agent for the benefit of a Canadian
Revolving Credit Lender with respect to the acceptance of a B/A,
calculated on the face amount of the B/A at the rate per annum equal
to the Applicable Margin for Canadian B/A Loans on the basis of the
number of days in the applicable Contract Period (inclusive of the
first day and exclusive of the last day) and a year of 365 days.
"Subsidiary": as to any Person, a corporation, partnership or
other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity are at the
time owned, or the management of which is otherwise controlled,
directly or indirectly through one or more intermediaries, or both, by
such Person. Unless otherwise qualified, all references to a
"Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Company, which shall include,
without limitation, Soda Ash Partners.
"Subsidiary Guarantor": each Domestic Subsidiary of the
Company (other than Soda Ash Partners) (a) 80% or more of the common
Equity Interests of which is owned by the Company, directly or
indirectly (other than indirectly through any Foreign
30
Subsidiary, any Foreign Subsidiary Holding Company or Soda Ash
Partners), (b) that is or becomes a party to the Guarantee and
Collateral Agreement or (c) that is designated by the Company as a
Subsidiary Guarantor and becomes a party to the Guarantee and
Collateral Agreement.
"Supply Partnership": any Person (a) in which the Company
beneficially owns Equity Interests and (b) which has been organized
for the purpose of toll manufacturing, marketing or selling industrial
chemical products, mining minerals and/or supplying energy, raw
materials or transportation services for the benefit of (x) the
Company and its Subsidiaries in the ordinary course of business, (y)
one or more of its customers or raw material (including energy)
suppliers and (z) if applicable, other Persons similarly situated as
the Company and its Subsidiaries with respect to such benefits.
"Termination Date": April 30, 2004.
"TOSOH": TOSOH Wyoming, Inc., a Delaware corporation.
"Total Canadian Revolving Credit Commitments": at any time,
the aggregate amount of the Canadian Revolving Credit Commitments then
in effect. The original amount of the Total Canadian Revolving Credit
Commitments as of the Effective Date is $60,000,000.
"Total Canadian Revolving Extensions of Credit": at any time,
the Dollar Equivalent Amount of the aggregate amount of the Canadian
Revolving Extensions of Credit of the Canadian Revolving Credit
Lenders outstanding at such time.
"Total Commitments": at any time, the aggregate amount of the
Revolving Credit Commitments and Canadian Revolving Credit Commitments
then in effect. The original amount of the Total Commitments as of the
Effective Date is $85,000,000.
"Total Credit Percentage": as to any Lender at any time, the
percentage of the aggregate Revolving Credit Commitments and Canadian
Revolving Credit Commitments then constituted by its Revolving Credit
Commitment and Canadian Revolving Credit Commitment (or, if the
Revolving Credit Commitments or Canadian Revolving Credit Commitments
have terminated or expired, the percentage of the aggregate Dollar
Equivalent Amount of outstanding Loans and interests in the
outstanding L/C Obligations then constituted by its outstanding Loans
and interests in outstanding L/C Obligations).
"Total Revolving Credit Commitments": at any time, the
aggregate amount of the Revolving Credit Commitments then in effect.
The original amount of the Total Revolving Credit Commitments as of
the Effective Date is $25,000,000.
31
"Total Revolving Extensions of Credit": at any time, the
aggregate amount of the Revolving Extensions of Credit of the
Revolving Credit Lenders outstanding at such time.
"Transferee": as defined in subsection 10.6(f).
"Type": as to any Revolving Credit Loan, its nature as an ABR
Loan or a Eurodollar Loan; and as to any Canadian Revolving Credit
Loan, its nature as a Canadian Prime Rate Loan, a Canadian Base Rate
Loan, a Eurodollar Loan or a Canadian B/A Loan.
"Uniform Customs": the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, as the same may be amended from time to time.
"US Base Rate": the rate of interest per annum in effect from
time to time that is equal to the greater of (a) the rate of interest
publicly announced by the Canadian Administrative Agent from time to
time as being its reference rate then in effect for determining
interests rates for commercial loans in Dollars made in Canada and (b)
the Federal Funds Effective Rate plus 1/2 of 1%.
"Voting Stock": Capital Stock of a Person normally entitled
to vote in the election of directors (or other persons exercising
similar functions) of such Person.
1.2 (a) Other Definitional Provisions. (a) Unless otherwise
specified therein, all terms defined in this Agreement shall have the defined
meanings when used in the Notes and the other Loan Documents or any certificate
or other document made or delivered pursuant hereto.
(b) As used herein and in the Notes and the other Loan
Documents, and any certificate or other document made or delivered pursuant
hereto, accounting terms relating to Holdings and its Subsidiaries not defined
in subsection 1.1 and accounting terms partly defined in subsection 1.1, to the
extent not defined, shall have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "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,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
32
1.3 Conflict Between Credit Agreement and other Loan
Documents . If there is any conflict between this Agreement and any other Loan
Document, this Agreement and such other Loan Document shall be interpreted and
construed, if possible, so as to avoid or minimize such conflict but, to the
extent (and only to the extent) of such conflict, this Agreement shall prevail
and control.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Commitments. (a) (i) Subject to the terms and conditions
hereof, each Revolving Credit Lender severally agrees to make revolving credit
loans denominated in Dollars ("Revolving Credit Loans") to the Company from time
to time during the Commitment Period in an aggregate principal amount at any one
time outstanding which, when added to such Lender's Revolving Credit Percentage
of then outstanding L/C Obligations under the Revolving Credit Commitments, does
not exceed the amount of such Lender's Revolving Credit Commitment. During the
Commitment Period the Company may use the Revolving Credit Commitments by
borrowing, prepaying the Revolving Credit Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof.
(ii) The Revolving Credit Loans may from time to time be (A)
Eurodollar Loans, (B) ABR Loans or (C) a combination thereof, as determined by
the Company and notified to the Administrative Agent in accordance with
subsections 2.2 and 2.10, provided that no Loan shall be made as a Eurodollar
Loan after the day that is one month prior to the Termination Date.
(b) (i) Subject to the terms and conditions hereof, each
Canadian Revolving Credit Lender severally agrees to make revolving credit loans
denominated in Dollars or Canadian Dollars ("Canadian Revolving Credit Loans")
to the Canadian Borrower from time to time during the Commitment Period in an
aggregate principal amount having a Dollar Equivalent Amount at any one time
outstanding which, when added to such Lender's Canadian Revolving Credit
Percentage of then outstanding L/C Obligations under the Canadian Revolving
Credit Commitments, does not exceed the amount of such Lender's Canadian
Revolving Credit Commitment. During the Commitment Period the Canadian Borrower
may use the Canadian Revolving Credit Commitments by borrowing, prepaying the
Canadian Revolving Credit Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof.
(ii) The Canadian Revolving Credit Loans may from time to
time be (A) Canadian Base Rate Loans, (B) Eurodollar Loans, (C) Canadian Prime
Rate Loans, (D) Canadian B/A Loans or (E) a combination thereof, as determined
by the Canadian Borrower and notified to the Canadian Administrative Agent in
accordance with subsections 2.2, 2.3 and 2.10, provided that no Canadian B/A
Loan may be made after the day that is 30 days prior to the Termination Date.
2.2 Procedure for Borrowing. (a) The Company may borrow under
the Revolving Credit Commitments during the Commitment Period on any Business
Day, provided that the Company shall give the Administrative Agent irrevocable
notice (which notice must be
33
received by the Administrative Agent prior to 11:00 A.M., New York City time,
(i) three Business Days prior to the requested Borrowing Date, if all or any
part of the requested Revolving Credit Loans are to be initially Eurodollar
Loans or (ii) one Business Day prior to the requested Borrowing Date,
otherwise), specifying (A) the amount to be borrowed, (B) the requested
Borrowing Date, (C) whether the borrowing is to be of Eurodollar Loans,
ABR Loans or a combination thereof and (D) if the borrowing is to be entirely
or partly of Eurodollar Loans, the amounts of such Type of Loan and the
lengths of the initial Interest Periods therefor. Each borrowing under the
Revolving Credit Commitments shall be in an amount equal to (x) in the case of
ABR Loans, $1,000,000 or a whole multiple thereof (or, if then Available
Revolving Credit Commitments are less than $1,000,000, such lesser amount) and
(y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of
$1,000,000 in excess thereof. Upon receipt of any such notice from the Company,
the Administrative Agent shall promptly notify each Revolving Credit Lender
thereof. Each Revolving Credit Lender will make the amount of its pro rata share
of each borrowing available to the Administrative Agent for the account of the
Company at the office of the Administrative Agent specified in subsection 10.2
prior to 12:00 Noon, New York City time, on the Borrowing Date requested by the
Company in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Company by the Administrative Agent
crediting the account of the Company on the books of such office with the
aggregate of the amounts made available to the Administrative Agent by the
Revolving Credit Lenders and in like funds as received by the Administrative
Agent.
(b) The Canadian Borrower may borrow under the Canadian
Revolving Credit Commitments during the Commitment Period on any Business Day,
provided that the Canadian Borrower shall give the Canadian Administrative Agent
irrevocable notice (which notice must be received by the Canadian Administrative
Agent prior to 11:00 A.M., Toronto time, (i) three Business Days prior to the
requested Borrowing Date, if all or any part of the requested Canadian Revolving
Credit Loans are to be initially Eurodollar Loans, (ii) two Business Days prior
to the requested Borrowing Date, if all or any part of the requested Canadian
Revolving Credit Loans are to be initially Canadian B/A Loans or (iii) one
Business Day prior to the requested Borrowing Date, otherwise), specifying (A)
the amount to be borrowed, (B) the requested Borrowing Date, (C) whether the
borrowing is to be of Canadian B/A Loans, Canadian Prime Rate Loans, Eurodollar
Loans, Canadian Base Rate Loans or a combination thereof, (D) whether the
requested Loans are to be denominated in Dollars or Canadian Dollars and (E) if
the borrowing is to be entirely or partly by way of Canadian B/A Loans, the
aggregate face amount of such B/As and the lengths of the initial Contract
Periods therefor. Each borrowing under the Canadian Revolving Credit Commitments
shall be in an amount equal to (w) in the case of Canadian Base Rate Loans,
$1,000,000 or a whole multiple thereof (or, if then Available Canadian Revolving
Credit Commitments are less than $1,000,000, such lesser amount), (x) in the
case of Canadian Prime Rate Loans, C$1,000,000 or a whole multiple thereof (or,
if the then Available Canadian Revolving Credit Commitments are less than
C$1,000,000, such lesser amount), (y) in the case of Eurodollar Loans,
$5,000,000 or a whole multiple of $1,000,000 in excess thereof (or, if the then
Available Canadian Revolving Credit Commitments are less than $5,000,000, such
lesser amount) and (z) in the case of Canadian B/A Loans, C$5,000,000 or a whole
multiple of C$1,000,000 in excess thereof (or, if the then Available Canadian
Revolving Credit Commitments are less than C$5,000,000, such lesser amount).
Upon receipt of any such notice from the Canadian Borrower, the Canadian
Administrative Agent shall promptly notify
34
each Canadian Revolving Credit Lender thereof. Each Canadian Revolving Credit
Lender will make the amount of its pro rata share of each borrowing available
to the Canadian Administrative Agent for the account of the Canadian Borrower
at the office of the Canadian Administrative Agent specified in subsection
10.2 prior to 12:00 Noon, Toronto time, on the Borrowing Date requested
by the Canadian Borrower in funds immediately available to the Canadian
Administrative Agent. Such borrowing will then be made available to the
Canadian Borrower by the Canadian Administrative Agent crediting the
account of the Canadian Borrower on the books of such office with the
aggregate of the amounts made available to the Canadian Administrative Agent
by the Canadian Revolving Credit Lenders and in like funds as received by
the Canadian Administrative Agent. Notwithstanding the foregoing, Canadian B/A
Loans shall be made in accordance with the provisions of subsection 2.3.
2.3 Canadian B/A Loans; Acceptances. (a) Subject to the terms
and conditions of this Agreement, the Canadian Borrower may request a Canadian
B/A Loan by presenting drafts for acceptance and purchase as B/As by the
Canadian Revolving Credit Lenders.
(b) No Contract Period with respect to a B/A shall extend
beyond the Termination Date.
(c) To facilitate availment of the Canadian B/A Loans, the
Canadian Borrower hereby appoints each Canadian Revolving Credit Lender as its
attorney to sign and endorse on its behalf, in handwriting or by facsimile or
mechanical signature as and when deemed necessary by such Canadian Revolving
Credit Lender, blank forms of B/As substantially in the form of Exhibit H. In
this respect, it is each Canadian Revolving Credit Lender's responsibility to
maintain an adequate supply of blank forms of B/As for acceptance under this
Agreement. The Canadian Borrower recognizes and agrees that all B/As signed
and/or endorsed on its behalf by a Canadian Revolving Credit Lender as required
hereunder shall bind the Canadian Borrower as fully and effectually as if signed
in the handwriting of and duly issued by the proper signing officers of the
Canadian Borrower. Each Canadian Revolving Credit Lender is hereby authorized to
issue such B/As endorsed in blank in such face amounts as may be determined by
such Canadian Revolving Credit Lender; provided that the aggregate amount
thereof is equal to the aggregate amount of B/As required by the Canadian
Borrower to be accepted and purchased by such Canadian Revolving Credit Lender.
No Canadian Revolving Credit Lender shall be liable for any damage, loss or
other claim arising by reason of any loss or improper use of any such instrument
except the gross negligence or wilful misconduct of the Canadian Revolving
Credit Lender or its officers, employees, agents or representatives. Each
Canadian Revolving Credit Lender shall maintain a record with respect to B/As
(a) received by it from the Canadian Administrative Agent in blank hereunder,
(b) voided by it for any reason, (c) accepted and purchased by it hereunder, and
(d) canceled at their respective maturities. Each Canadian Revolving Credit
Lender further agrees to retain such records in the manner and for the statutory
periods provided in the various provincial or federal statutes and regulations
which apply to such Canadian Revolving Credit Lender. Each Canadian Revolving
Credit Lender agrees to provide such records to the Canadian Borrower at the
Canadian Borrower's expense upon request. On request by or on behalf of the
Canadian Borrower, a Canadian Revolving Credit Lender shall cancel all forms of
B/A which have been pre-signed or pre-endorsed on behalf of the Canadian
35
Borrower and which are held by the said Canadian Revolving Credit Lender and are
not required to be issued in accordance with the Canadian Borrower's irrevocable
notice.
(d) Drafts of the Canadian Borrower to be accepted as B/As
hereunder shall be signed as set forth in this subsection 2.3. Notwithstanding
that any Person whose signature appears on any B/A may no longer be an
authorized signatory for any of the Canadian Revolving Credit Lenders or the
Canadian Borrower at the date of issuance of a B/A, such signature shall
nevertheless be valid and sufficient for all purposes as if such authority had
remained in force at the time of such issuance and any such B/A so signed shall
be binding on the Canadian Borrower.
(e) Promptly following receipt of a notice of borrowing,
notice of rollover or notice of conversion by way of B/As, in accordance with
subsection 2.2(b), 2.3(h) or 2.3(k), as applicable, the Canadian Administrative
Agent shall so advise the Canadian Revolving Credit Lenders and shall advise
each Canadian Revolving Credit Lender of the aggregate face amount of the B/As
to be accepted by it and the applicable Contract Period (which shall be
identical for all Canadian Revolving Credit Lenders). The aggregate face amount
of the B/As to be accepted by a Canadian Revolving Credit Lender shall be an
integral multiple of C$100,000 and such face amount shall be in each Canadian
Revolving Credit Lender's Applicable Percentage of such Canadian B/A Loan;
provided, that the Canadian Administrative Agent may, in its sole discretion,
increase or reduce any Canadian Revolving Credit Lender's portion of such B/A to
the nearest C$100,000.
(f) Upon acceptance of a B/A by a Canadian Revolving Credit
Lender, such Canadian Revolving Credit Lender shall purchase, or arrange for a
resident of Canada under the Income Tax Act (Canada) to purchase, each B/A from
the Canadian Borrower at the Discount Rate for such Canadian Revolving Credit
Lender applicable to such B/A accepted by it and provide to the Canadian
Administrative Agent the Discount Proceeds for the account of the Canadian
Borrower. The Stamping Fee payable by such Canadian Borrower to a Canadian
Revolving Credit Lender under subsection 2.12 in respect of each B/A accepted by
such Canadian Revolving Credit Lender shall be set off against the Discount
Proceeds payable by the Canadian Revolving Credit Lender under this subsection
2.3.
(g) Each Canadian Revolving Credit Lender may at any time and
from time to time hold, sell, rediscount or otherwise dispose of any or all B/As
accepted and purchased by it.
(h) With respect to each Canadian B/A Loan which is
outstanding hereunder, at or before 11:00 a.m. (Toronto time) two Business Days
before the maturity date of such B/As, the Canadian Borrower shall notify the
Canadian Administrative Agent at the Canadian Administrative Agent's address set
forth in subsection 10.2 by irrevocable telephone notice, followed by a notice
of rollover on the same day, if the Canadian Borrower intends to issue B/As on
such maturity date to provide for the payment of such maturing B/As. If the
Canadian Borrower fails to notify the Canadian Administrative Agent of its
intention to issue B/As on such maturity date, the Canadian Borrower shall
provide on the maturity date of such B/As payment to the Canadian Administrative
Agent on behalf of the Canadian Revolving Credit Lenders of an amount equal to
the aggregate face amount of such B/As. If the Canadian Borrower fails to
36
make such payment, such maturing B/As shall be deemed to have been converted on
their maturity date into a Canadian Prime Rate Loan in an amount equal to the
face amount of such B/As.
(i) The Canadian Borrower waives presentment for payment and
any other defense to payment of any amounts due to a Canadian Revolving Credit
Lender in respect of a B/A accepted and purchased by it pursuant to this
Agreement which might exist solely by reason of such B/A being held, at the
maturity thereof, by such Canadian Revolving Credit Lender in its own right and
the Canadian Borrower agrees not to claim any days of grace if such Canadian
Revolving Credit Lender as holder sues the Canadian Borrower on the B/A for
payment of the amount payable by the Canadian Borrower thereunder. On the
specified maturity date of a B/A, or such earlier date as may be required or
permitted pursuant to the provisions of this Agreement, the Canadian Borrower
shall pay the Canadian Revolving Credit Lender that has accepted and purchased
such B/A the full face amount of such B/A and after such payment, the Canadian
Borrower shall have no further liability in respect of such B/A and such
Canadian Revolving Credit Lender shall be entitled to all benefits of, and be
responsible for all payments due to third parties under, such B/A.
(j) If any Event of Default shall occur and be continuing and
the Loans are accelerated pursuant to Section 8, the Canadian Borrower shall, on
the Business Day it receives notice from the Canadian Administrative Agent,
deposit in an account with the Canadian Administrative Agent for the benefit of
the Canadian Revolving Credit Lenders, an amount in cash equal to its Acceptance
Exposure as of such date. Such deposit shall be held by the Canadian
Administrative Agent as collateral for the payment and performance of the
Canadian Borrower Obligations. So long as such Event of Default is continuing,
the Canadian Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits in Cash Equivalents, which
investments shall be made at the option and sole discretion of the Canadian
Administrative Agent, such deposits shall not bear interest. Interest or
profits, if any, on such investments shall accumulate in such account. Moneys in
such account shall automatically be applied by the Canadian Administrative Agent
to reimburse the applicable Canadian Revolving Credit Lenders for Acceptance
Exposure and, if the maturity of the Loans has been accelerated, to satisfy the
Canadian Borrower Obligations. All remaining amounts on deposit shall be
returned to the Canadian Borrower within three Business Days after all Events of
Default have been cured or waived.
(k) The Canadian Borrower shall have the right at any time
upon irrevocable notice to the Canadian Administrative Agent not later than
11:00 A.M., Toronto time, two Business Days prior to conversion, to convert
Canadian Prime Rate Loans to Canadian B/A Loans, subject to the following
conditions:
(i) each conversion shall be made pro rata among the Canadian
Revolving Credit Lenders in accordance with the respective principal
amounts of the Canadian Prime Rate Loans comprising the converted
Loans;
37
(ii) if less than all of the outstanding principal amount of
Canadian Prime Rate Loans shall be converted, the aggregate principal
amount converted shall not be less than C$5,000,000;
(iii) each conversion shall be effected by each Canadian
Revolving Credit Lender's converting the applicable principal amount
of its applicable Canadian Prime Rate Loans into Canadian B/A Loans
having Discount Proceeds equal to such principal amount, and accrued
interest on any Prime Rate Loans being converted shall be paid by the
Canadian Borrower at the time of conversion;
(iv) all Acceptances to be issued as a result of the
conversion of the Canadian Prime Rate Loans shall be issued in
accordance with the provisions of this subsection 2.3; and
(v) Canadian Prime Rate Loans may not be converted into
Canadian B/A Loans if a Default or an Event of Default has occurred
and is continuing and the Canadian Administrative Agent has determined
that such conversion is not appropriate.
(l) At the option of the Canadian Borrower and any Canadian
Revolving Credit Lender, Acceptances under this Agreement to be accepted by such
Canadian Revolving Credit Lender may be issued in the form of depository bills
for deposit with The Canadian Depository for Securities Limited pursuant to the
Depository Bills and Notes Act (Canada). All depository bills so issued shall be
governed by the provisions of this subsection 2.3.
2.4 Reallocation. (a) The Borrowers may, from time to time
during the Commitment Period (but not more than once per calendar quarter),
temporarily reduce, in whole or in part, or increase, the Canadian Revolving
Credit Commitments by giving an irrevocable joint written notice (each, a
"Reallocation Notice") to the Canadian Administrative Agent and the
Administrative Agent at least ten (10) Business Days prior to the day (which day
shall be a Business Day) specified in such notice as the effective date for such
reduction or increase in the Canadian Revolving Credit Commitments, which day
shall (unless otherwise agreed by all of the Canadian Revolving Credit Lenders
in their sole discretion) be the first Business Day of the next following
calendar quarter (the "Reallocation Date"). Any reductions or increases in the
Canadian Revolving Credit Commitments shall take effect on the Reallocation
Date. Each reduction or increase in the Canadian Revolving Credit Commitments
shall result in an automatic corresponding increase or reduction in the
Revolving Credit Commitments; provided that (A) the amount of the Canadian
Revolving Credit Commitments shall not, at any time, (i) be reduced to an amount
that is less than the Total Canadian Revolving Extensions of Credit at such time
or (ii) exceed the Maximum Canadian Revolving Credit Commitments, and (B) the
amount of the Revolving Credit Commitments shall not, at any time, (i) be
reduced to an amount that is less than the Total Revolving Extensions of Credit
at such time or (ii) exceed the Total Commitments as of the Effective Date, as
the Total Commitments may, from time to time, be permanently reduced or canceled
in accordance with subsection 2.8 or 2.9 and (C) the sum of the Revolving Credit
Commitments and the Canadian Revolving Credit Commitments shall not, at any
time, exceed the Total Commitments as of the Effective Date, as the Total
Commitments may, from
38
time to time, be permanently reduced or canceled in accordance with subsection
2.8 or 2.9. Any amount of the Canadian Revolving Credit Commitments
reallocated under this subsection 2.4 as Revolving Credit Commitments
will not be available to the Canadian Borrower, and any amount of
the Revolving Credit Commitments reallocated under this subsection 2.4 as
Canadian Revolving Credit Commitments will not be available to the Company,
unless and until such amounts are reallocated back to the Canadian Revolving
Credit Commitments or the Revolving Credit Commitments, as the case may be, in
accordance with the terms and conditions of this subsection 2.4.
(b) The ability of the Borrowers to reallocate the Revolving
Credit Commitments and the Canadian Revolving Credit Commitments in accordance
with this subsubsection 2.4 shall be subject to the conditions that (A) the
representations and warranties set forth in each Loan Document shall be true and
correct in all material respects on and as of the date of such reallocation with
the same effect as though made on and as of such date, except to the extent that
such representations and warranties expressly relate to an earlier date and (B)
at the time of and immediately following such reduction or increase, no Event of
Default or Default shall have occurred and be continuing. Each Reallocation
Notice shall specify the amount (expressed in Dollars) of any reduction or
increase in the Canadian Revolving Credit Commitments and the corresponding
increase or reduction in the Revolving Credit Commitments. Each reallocation
requested under this subsection 2.4 shall be in a minimum aggregate principal
amount of $5,000,000 (or, if less, the remaining amount of the Total Canadian
Revolving Credit Commitments) and in integral multiples of $1,000,000. Each
reduction or increase in the Canadian Revolving Credit Commitments under this
subsection 2.4 shall be made ratably among the Canadian Revolving Credit Lenders
based on their respective Canadian Revolving Credit Commitments. Each reduction
or increase in the Revolving Credit Commitments under this subsection 2.4 shall
be made ratably among the Revolving Credit Lenders based on their respective
Revolving Credit Commitments. The Canadian Administrative Agent or the
Administrative Agent, as the case may be, shall promptly after receiving a
Reallocation Notice notify each Canadian Revolving Credit Lender or Revolving
Credit Lender, as the case may be, of the amount of its Canadian Revolving
Credit Commitment or Revolving Credit Commitment, as the case may be, to be
reallocated and the date of such reallocation.
2.5 Canadian Borrower. Notwithstanding anything in this
Agreement or in any other Loan Document to the contrary, wherever in this
Agreement or any other Loan Document a representation or warranty, indemnity,
covenant or other obligation is expressed to be given or made by or imposed upon
the Canadian Borrower, such representation, warranty, indemnity, covenant or
obligation shall in each case not impose on the Canadian Borrower any obligation
to give financial assistance by way of loan, guarantee, the giving of security,
the payment of money or otherwise within the meaning of Section 44 of the Canada
Business Corporations Act to or for the benefit of any person other than a
holding body corporate as referred to in clause 44(2)(c) of the Canada Business
Corporations Act.
2.6 Repayment of Loans; Evidence of Debt. (a) The Company
hereby unconditionally promises to pay to the Administrative Agent for the
account of the appropriate Revolving Credit Lender the then unpaid principal
amount of each Revolving Credit Loan of such Revolving Credit Lender on the
Termination Date (or such earlier date on which the Loans
39
become due and payable pursuant to Section 8 or the Revolving Credit
Commitments are otherwise terminated). The Canadian Borrower hereby
unconditionally promises to pay to the Canadian Administrative Agent
for the account of the appropriate Canadian Revolving Credit Lender the
then unpaid principal amount of each Canadian Revolving Credit Loan of
such Canadian Revolving Credit Lender on the Termination Date (or
such earlier date on which the Loans became due and payable pursuant
to Section 8 or the Canadian Revolving Credit Commitments are otherwise
terminated). Each Borrower hereby further agrees to pay interest on the unpaid
principal amount of the Loans from time to time outstanding from the date hereof
until payment in full thereof at the rates per annum, and on the dates, set
forth in subsection 2.12.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of each Borrower to such
Lender resulting from each Loan of such Lender 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) (i) The Administrative Agent, on behalf of the Company,
shall maintain the Register pursuant to subsection 10.6(d), and a subaccount
therein for each Lender, in which shall be recorded (A) the amount of each Loan
made hereunder and any Note evidencing such Loan, the Type thereof and each
Interest Period applicable thereto, (B) the amount of any principal or interest
due and payable or to become due and payable from the Company to each Lender
hereunder and (C) both the amount of any sum received by the Administrative
Agent hereunder from the Company and each Lender's share thereof.
(ii) The Canadian Administrative Agent, on behalf of the
Canadian Borrower, shall maintain the Register pursuant to subsection 10.6(d),
and a subaccount therein for each Canadian Revolving Credit Lender, in which
shall be recorded (A) the amount of each Canadian Revolving Credit Loan made
hereunder and any Note evidencing such Loan, the Type thereof and each Contract
Period (if any) applicable thereto, (B) the amount of any principal or interest
due and payable or to become due and payable from the Canadian Borrower to each
Canadian Revolving Credit Lender hereunder and (C) both the amount of any sum
received by the Canadian Administrative Agent hereunder from the Canadian
Borrower and each Canadian Revolving Credit Lender's share thereof.
(d) The entries made in the Register and the accounts of each
Lender maintained pursuant to subsection 2.6(b) shall, to the extent permitted
by applicable law and in the absence of manifest error, be prima facie evidence
of the existence and amounts of the obligations of each Borrower therein
recorded; provided, however, that the failure of any Lender, the Administrative
Agent or the Canadian Administrative Agent to maintain the Register or any such
account, or any error therein, shall not in any manner affect the obligation of
either Borrower to repay (with applicable interest) the Loans made to such
Borrower by such Lender in accordance with the terms of this Agreement.
(e) Each Borrower agrees that, upon the request to the
Applicable Agent by any Lender, such Borrower will execute and deliver to such
Lender a promissory note of such Borrower evidencing any Loans of such Lender,
substantially in the forms of Exhibit F-1 in the
40
case of Revolving Credit Loans or F-2 in the case of Canadian Revolving
Credit Loans, with appropriate insertions as to date and principal amount.
2.7 Commitment Fee. (a) (i) Subject to subsection
2.15(b)(ii), the Company agrees to pay to the Administrative Agent for the
account of each Revolving Credit Lender a commitment fee in Dollars for the
period from and including the first day of the Commitment Period to the
Termination Date, computed at the Commitment Fee Rate on and after the Effective
Date, on the average daily amount of the Available Revolving Credit Commitment
of such Lender during the period for which payment is made, payable quarterly in
arrears on the last day of each March, June, September and December and on the
Termination Date or such earlier date as the Revolving Credit Commitments shall
terminate as provided herein, commencing on the first of such dates to occur
after the Effective Date.
(ii) Subject to subsection 2.15(b)(ii), the Canadian Borrower
agrees to pay to the Canadian Administrative Agent for the account of each
Canadian Revolving Credit Lender a commitment fee in Dollars for the period from
and including the first day of the Commitment Period to the Termination Date,
computed at the Commitment Fee Rate on and after the Effective Date, on the
average daily amount of the Available Canadian Revolving Credit Commitment of
such Lender during the period for which payment is made, payable quarterly in
arrears on the last day of each March, June, September and December and on the
Termination Date or such earlier date as the Canadian Revolving Credit
Commitments shall terminate as provided herein, commencing on the first of such
dates to occur after the Effective Date.
(b) The Company agrees to pay to the Agents the fees in the
amounts and on the dates from time to time agreed to in writing by Holdings or
the Company and the respective Agents.
2.8 Optional Termination or Reduction of Commitments . The
Company shall have the right, upon not less than five Business Days' notice to
the Administrative Agent, to terminate the Total Commitments or, from time to
time, to reduce the amount of the Total Commitments, provided that (i) in the
event of a partial reduction of the Total Commitments, such notice shall specify
how such reduction is to be applied to the Total Revolving Credit Commitments
and the Total Canadian Revolving Credit Commitments, and (ii) no such
termination or reduction shall be permitted if, after giving effect thereto and
to any prepayments of the Loans made on the effective date thereof, (A) the
aggregate principal amount of the Revolving Credit Loans then outstanding, when
added to the then outstanding L/C Obligations under the Revolving Credit
Commitments, would exceed the Revolving Credit Commitments then in effect or (B)
the Dollar Equivalent Amount of the aggregate principal amount of the Canadian
Revolving Credit Loans then outstanding, when added to the then outstanding L/C
Obligations under the Canadian Revolving Credit Commitments, would exceed the
Canadian Revolving Credit Commitments then in effect. Any such partial reduction
of the Total Commitments, the Total Revolving Credit Commitments and/or the
Total Canadian Revolving Credit Commitments shall be in an amount equal to
$1,000,000 or a whole multiple thereof and shall reduce permanently the Total
Commitments and, subject to any reallocation permitted under subsection 2.4, the
Revolving Credit Commitments or the Canadian Revolving Credit Commitments, as
applicable, then in effect.
41
2.9 Optional Prepayments; Mandatory Prepayments and
Commitment Reductions. (a) Each Borrower may on the last day of any Interest
Period with respect thereto, in the case of Eurodollar Loans, on the last day of
any Contract Period with respect thereto, in the case of Canadian B/A Loans, or
at any time and from time to time, in the case of ABR Loans, Canadian Base Rate
Loans and Canadian Prime Rate Loans, prepay the Loans, in whole or in part,
without premium or penalty, upon at least three Business Days' irrevocable
notice in the case of Eurodollar Loans, upon at least two Business Days'
irrevocable notice in the case of Canadian B/A Loans, and upon at least one
Business Day's irrevocable notice in the case of ABR Loans, Canadian Base Rate
Loans and Canadian Prime Rate Loans, to the Applicable Agent, specifying the
date and amount of prepayment and whether the prepayment is of (i) Revolving
Credit Loans, Canadian Revolving Credit Loans or a combination thereof and (ii)
Eurodollar Loans, ABR Loans, Canadian B/A Loans, Canadian Base Rate Loans,
Canadian Prime Rate Loans or a combination thereof, and, if of a combination
thereof, the amount allocable to each. Upon receipt of any such notice the
Applicable Agent shall promptly notify each affected Lender thereof. If any such
notice is given, the amount specified in such notice shall be due and payable on
the date specified therein, together with any amounts payable pursuant to
subsection 2.19.
(b) (i) If, at any time during the Commitment Period, the
Total Revolving Extensions of Credit exceed the Total Revolving Credit
Commitments then in effect, the Company shall, without notice or demand,
immediately repay the Revolving Credit Loans in an aggregate principal amount
equal to such excess, together with interest accrued to the date of such payment
or prepayment and any amounts payable under subsection 2.19. To the extent that
after giving effect to any prepayment of the Revolving Credit Loans required by
the preceding sentence, the Total Revolving Extensions of Credit exceed the
Total Revolving Credit Commitments then in effect, the Company shall, without
notice or demand, immediately cash collateralize the then outstanding L/C
Obligations under the Revolving Credit Commitments in an amount equal to such
excess in accordance with paragraph (f) below.
(ii) If, at any time during the Commitment Period, the Total
Canadian Revolving Extensions of Credit exceed the aggregate Canadian Revolving
Credit Commitments then in effect, the Canadian Borrower shall, without notice
or demand, immediately repay the Canadian Revolving Credit Loans (other than
Canadian B/A Loans) in an aggregate principal amount equal to such excess,
together with interest accrued to the date of such payment or prepayment and any
amounts payable under subsection 2.19. To the extent that after giving effect to
any prepayment of the Canadian Revolving Credit Loans required by the preceding
sentence, the Total Canadian Revolving Extensions of Credit exceed the Total
Canadian Revolving Credit Commitments then in effect, the Canadian Borrower
shall, without notice or demand, immediately cash collateralize the then
outstanding L/C Obligations under the Canadian Revolving Credit Commitments and
Acceptance Exposure in an amount equal to such excess in accordance with
paragraph (f) below.
(c) If any Capital Stock or Indebtedness shall be issued or
incurred by the Company or any of its Subsidiaries (other than Indebtedness
permitted to be incurred under subsection 7.2 as in effect on the Closing Date,
including Indebtedness the proceeds of which are used to finance Permitted
Acquisitions), an amount equal to (i) in the case of issuances of Capital Stock,
50%, and (ii) in the case of incurrences of Indebtedness, 100%, of the Net Cash
Proceeds
42
thereof shall be applied on the date of such issuance or incurrence
toward the permanent reduction of the Total Commitments as set forth in
subsection 2.9(e).
(d) If on any date the Company or any of its Subsidiaries
shall receive Net Cash Proceeds from any Asset Sale or Recovery Event then (i)
unless a Reinvestment Notice shall be delivered in respect thereof, such Net
Cash Proceeds shall be applied on such date toward the permanent reduction of
the Total Commitments as set forth in subsection 2.9(e) or (ii) if a
Reinvestment Notice has been delivered in respect thereof, on each Reinvestment
Prepayment Date, an amount equal to the Reinvestment Prepayment Amount with
respect to the relevant Reinvestment Event shall be applied toward the permanent
reduction of the Total Commitments as set forth in subsection 2.9(e).
Notwithstanding the foregoing, all Net Cash Proceeds in excess of $30,000,000
received in any fiscal year shall be applied toward the permanent reduction of
the Total Commitments as set forth in subsection 2.9(e).
(e) (i) Total Commitment reductions made pursuant to this
subsection 2.9 shall be applied to reduce the Total Revolving Credit Commitments
and the Total Canadian Revolving Credit Commitments in any order designated by
the Company, subject to any reallocation permitted under subsection 2.4.
(ii) Any such reduction of the Total Revolving Credit
Commitments shall be accompanied by prepayment of the Revolving Credit Loans to
the extent, if any, that the Total Revolving Extensions of Credit exceed the
amount of the Total Revolving Credit Commitments as so reduced, provided that if
the aggregate principal amount of Revolving Credit Loans then outstanding is
less than the amount of such excess (because L/C Obligations under the Revolving
Credit Commitments constitute a portion thereof), the Company shall, to the
extent of the balance of such excess, replace outstanding Letters of Credit
and/or deposit an amount in cash in a cash collateral account established with
the Administrative Agent for the benefit of the Lenders in accordance with
paragraph (f) below. The application of any prepayment pursuant to this
subsection shall be made first to ABR Loans and second to Eurodollar Loans. Each
prepayment of the Revolving Credit Loans under this subsection 2.9(e)(ii)
(except in the case of Revolving Credit Loans that are ABR Loans) shall be
accompanied by accrued interest to the date of such prepayment on the amount
prepaid and any amounts payable under subsection 2.19.
(iii) Any such reduction of the Total Canadian Revolving
Credit Commitments shall be accompanied by prepayment of the Canadian Revolving
Credit Loans (other than Canadian B/A Loans) to the extent, if any, that the
Total Canadian Revolving Extensions of Credit exceed the amount of the Total
Canadian Revolving Credit Commitments as so reduced, provided that if the
aggregate principal amount of Canadian Revolving Credit Loans (other than
Canadian B/A Loans) then outstanding is less than the amount of such excess
(because Canadian B/A Loans or L/C Obligations under the Canadian Revolving
Credit Commitments constitute a portion thereof), the Canadian Borrower shall,
to the extent of the balance of such excess, replace outstanding Letters of
Credit, terminate outstanding Acceptances and/or deposit an amount in cash in a
cash collateral account established with the Canadian Administrative Agent for
the benefit of the Canadian Revolving Credit Lenders in accordance with
paragraph (f) below. Each prepayment of the Loans under this subsection 2.9
(e)(iii) shall be accompanied by accrued
43
interest to the date of such prepayment on the amount prepaid and any amounts
payable under subsection 2.19.
(f) The cash collateralization of L/C Obligations and
Acceptance Reimbursement Obligations shall be accomplished by the applicable
Borrower's depositing an amount equal to such L/C Obligations or Acceptance
Reimbursement Obligations, as the case may be, in a cash collateral account
opened by the Applicable Agent. This account shall bear interest which shall, so
long as no Event of Default has occurred and is continuing, be payable to the
applicable Borrower (and, if an Event of Default shall have occurred, such
interest shall remain in such account until such Event of Default ceases to
exist or the Applicable Agent has applied such interest to payment of the
Company Obligations or the Canadian Borrower Obligations, as the case may be).
Neither Borrower shall have any right to withdraw any amount from such cash
collateral account; provided that, so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, the Applicable Agent
shall, at the request of the applicable Borrower, from time to time, release an
amount of cash collateral equal to the excess of all cash collateral then on
deposit in such cash collateral account over the then applicable outstanding L/C
Obligations and Acceptance Reimbursement Obligations and accrued interest
thereon. Each Borrower hereby grants to the Applicable Agent, for the benefit of
the applicable Issuing Banks and the applicable Participating Banks, a security
interest in such cash collateral (in whatever form) and the proceeds thereof to
secure all such L/C Obligations. Amounts held in such cash collateral account
shall be applied by the Applicable Agent to the payment of such L/C Obligations
and Acceptance Reimbursement Obligations. Each Borrower shall execute and
deliver to the Applicable Agent, for the account of the applicable Issuing Banks
and Participating Banks, such further documents and instruments as the
Applicable Agent may reasonably request to evidence the creation and perfection
of such security interest in such cash collateral account.
(g) If, on any Quarterly Date, the outstanding balance of the
Total Canadian Revolving Extensions of Credit exceeds 105% of the Canadian
Revolving Credit Commitments (as a result of the fluctuation of currency values
or otherwise), the Canadian Borrower shall immediately repay the aggregate
outstanding Canadian Revolving Credit Loans (other than Canadian B/A Loans) to
the extent required to eliminate such excess. If any such excess remains after
repayment in full of such Canadian Revolving Credit Loans, the Canadian Borrower
shall provide cash collateral for the L/C Obligations under the Canadian
Revolving Credit Commitments and Acceptance Exposure in the manner set forth in
subsections 2.3(j) and 2.10(f), as applicable, to the extent required to
eliminate such excess.
2.10 Conversion and Continuation Options. (a) Either Borrower
may elect from time to time to convert Eurodollar Loans to ABR Loans, in the
case of the Company, or Canadian Base Rate Loans, in the case of the Canadian
Borrower, by giving the Applicable Agent at least two Business Days' prior
irrevocable notice of such election, provided that any such conversion of
Eurodollar Loans may only be made on the last day of an Interest Period with
respect thereto. Either Borrower may elect from time to time to convert ABR
Loans, in the case of the Company, or Canadian Base Rate Loans, in the case of
the Canadian Borrower, to Eurodollar Loans by giving the Applicable Agent at
least three Business Days' prior irrevocable notice of such election. Any such
notice of conversion to Eurodollar Loans shall specify the
44
length of the initial Interest Period or Interest Periods therefor. Upon
receipt of any such notice the Applicable Agent shall promptly notify
each affected Lender thereof. All or any part of outstanding Eurodollar
Loans and ABR Loans, in the case of the Company, or Canadian Base Rate Loans,
in the case of the Canadian Borrower, may be converted as provided
herein, provided that (i) no Loan may be converted into a Eurodollar Loan
under a particular Facility when any Event of Default has occurred and is
continuing and the Applicable Agent has or the Majority Facility Lenders
under such Facility have determined not to permit such conversions and
(ii) no Loan under a particular Facility may be converted into a Eurodollar Loan
after the date that is one month prior to the final scheduled termination or
maturity date of such Facility.
(b) Any Eurodollar Loans may be continued as such upon the
expiration of then current Interest Period with respect thereto by the relevant
Borrower giving notice to the Applicable Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in subsection 1.1,
of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan under a particular Facility may be continued as
such (i) when any Event of Default has occurred and is continuing and the
Applicable Agent has or the Majority Facility Lenders under such Facility have
determined not to permit such continuations or (ii) after the date that is one
month prior to the final scheduled termination or maturity date of such Facility
and provided, further, that if the relevant Borrower shall fail to give any
required notice as described above in this paragraph or if such continuation is
not permitted pursuant to the preceding proviso such Loans shall be
automatically converted to ABR Loans, in the case of the Company, or Canadian
Base Rate Loans, in the case of the Canadian Borrower, on the last day of such
then expiring Interest Period.
(c) Canadian B/A Loans and Canadian Prime Rate Loans may be
converted and continued as provided in subsection 2.3.
2.11 Minimum Amounts of Tranches. All borrowings, conversions
and continuations of Loans hereunder and all selections of Interest Periods and
Contract Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Loans comprising each Eurodollar Tranche shall be equal to $5,000,000 or
a whole multiple of $1,000,000 in excess thereof and the aggregate amount of any
Canadian B/A Loans having identical Contract Periods commencing on the same date
shall be equal to C$5,000,000 or a whole multiple of C$1,000,000 in excess
thereof.
2.12 Interest Rates and Payment Dates. (a) Each Eurodollar
Loan shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such day
plus the Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per annum
equal to the ABR plus the Applicable Margin.
(c) Each Acceptance shall be subject to a Stamping Fee
payable on the date of acceptance thereof.
45
(d) Each Canadian Base Rate Loan shall bear interest at a
rate per annum equal to the US Base Rate plus the Applicable Margin.
(e) Each Canadian Prime Rate Loan shall bear interest at a
rate per annum equal to the Canadian Prime Rate plus the Applicable Margin.
(f) If all or a portion of (i) the principal amount of any
Loan, (ii) any interest payable thereon or (iii) any commitment fee or other
amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum which is (x) in the case of overdue principal, the rate that
would otherwise be applicable thereto pursuant to the foregoing provisions of
this subsection plus 2% (or, in the case of overdue Acceptance Reimbursement
Obligations, the rate that would be applicable to Canadian Prime Rate Loans plus
2%) or (y), to the extent permitted by applicable law, in the case of overdue
interest, commitment fee or other amount due in Dollars, the rate described in
paragraph (b) or (d) of this subsection for the applicable Facility (or, if
there is no applicable Facility, for the Revolving Credit Facility) plus 2%, in
each case from the date of such non-payment until such amount is paid in full
(as well after as before judgment), or (z) to the extent permitted by applicable
law, in the case of overdue interest, commitment fee or other amount due in
Canadian Dollars, the rate described in paragraph (e) of this subsection plus
2%, in each case from the date of such non-payment until such amount is paid in
full (as well after as before judgment); provided that, for purposes of this
subsection 2.12(f), any amount secured by mortgages on real property, if
required by the Interest Act (Canada), shall bear interest at the same rate as
such principal or interest amount not in arrears.
(g) Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (f) of this
subsection shall be payable from time to time on demand.
2.13 Computation of Interest and Fees. (a) Commitment fees,
commissions and interest shall be calculated on the basis of a 360-day year for
the actual days elapsed, except that, with respect to ABR Loans the rate of
interest on which is calculated on the basis of the Prime Rate, Canadian Prime
Rate Loans and Canadian Base Rate Loans, interest thereon shall be calculated on
the basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed. The Applicable Agent shall as soon as practicable notify the relevant
Borrower and the affected Lenders of each determination of a Eurodollar Rate.
Any change in the interest rate on a Loan resulting from a change in the ABR,
the Canadian Prime Rate, the US Base Rate or the Eurocurrency Reserve
Requirements shall become effective as of the opening of business on the day on
which such change becomes effective. The Applicable Agent shall as soon as
practicable notify the affected Borrower and the affected Lenders of the
effective date and the amount of each such change in interest rate.
(b) Each determination of an interest rate by the
Administrative Agent or the Canadian Administrative Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrowers and
the Lenders in the absence of manifest error. The Administrative Agent shall, at
the request of the Company, deliver to the Company a statement
46
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to subsection 2.12(a).
(c) For purposes of the Interest Act (Canada), whenever any
interest under this Agreement is calculated using an annual rate based on a
period which is less than the actual number of days in a year (the "Lesser
Period"), such rate determined pursuant to such calculation, when expressed as
an annual rate, is equivalent to (i) the applicable rate based on such Lesser
Period, (ii) multiplied by the actual number of days in the calendar year in
which the period for which such interest is payable ends, and (iii) divided by
the number of days in such Lesser Period. The rates of interest specified in
this Agreement are nominal rates and all interest payments and computations are
to be made without allowance or deduction for deemed reinvestment of interest.
2.14 Inability to Determine Interest Rate. If prior to the
first day of any Interest Period:
(a) the Applicable Agent shall have determined (which
determination shall be conclusive and binding upon the relevant
Borrower) that, by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining
the Eurodollar Rate for such Interest Period, or
(b) the Applicable Agent shall have received notice from the
Majority Facility Lenders in respect of the relevant Facility that the
Eurodollar Rate determined or to be determined for such Interest
Period will not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period,
the Applicable Agent shall give telecopy or telephonic notice thereof to the
relevant Borrower and the relevant Lenders as soon as practicable thereafter. If
such notice is given (x) any Eurodollar Loans under the relevant Facility
requested to be made on the first day of such Interest Period shall be made as
ABR Loans, (y) any Loans under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans under
such Facility shall be converted to or continued as ABR Loans, in the case of
the Company, or Canadian Base Rate Loans, in the case of the Canadian Borrower,
and (z) any outstanding Eurodollar Loans under such Facility shall be converted,
on the first day of such Interest Period, to ABR Loans, in the case of the
Company, or Canadian Base Rate Loans, in the case of the Canadian Borrower.
Until such notice has been withdrawn by the Applicable Agent, no further
Eurodollar Loans under such Facility shall be made or continued as such, nor
shall the relevant Borrower have the right to convert Loans under such Facility
to Eurodollar Loans.
2.15 Pro Rata Treatment and Payments. (a) Each borrowing by a
Borrower from the Lenders hereunder, each payment by a Borrower on account of
any commitment fee hereunder and any reduction of the Commitments of the Lenders
shall be made pro rata according to the respective Revolving Credit Commitment
Percentages or Canadian Revolving Credit Commitment Percentages, as the case may
be, of the relevant Lenders. Each payment
47
(other than prepayments) on account of principal of and interest on the Loans,
each payment in respect of fees payable hereunder and each payment in respect
of Reimbursement Obligations and Acceptance Reimbursement Obligations shall be
applied to the amounts of such obligations owing to the Lenders pro rata
according to the respective amounts then due and owing to the Lenders,
except to the extent otherwise required by clause (ii) of subsection
2.15(b), by subsection 2.18 or by subsection 2.21. All payments (including
prepayments) to be made by the Company hereunder, whether on account of
principal, interest, fees or otherwise, shall be made without set off
or counterclaim and shall be made prior to 12:00 Noon, New York City time, on
the due date thereof to the Administrative Agent, for the account of the
Lenders, at the Administrative Agent's office specified in subsection 10.2, in
Dollars and in immediately available funds, and all payments (including
prepayments) to be made by the Canadian Borrower hereunder, whether on account
of principal, interest, fees or otherwise, shall be made without setoff or
counterclaim and shall be made prior to 12:00 Noon, Toronto time, on the date
thereof to the Canadian Administrative Agent, for the account of the Lenders, at
the Canadian Administrative Agent's office specified in subsection 10.2, in
Dollars or Canadian Dollars, as required by the Loan Documents, and in
immediately available funds. Each of the Administrative Agent and the Canadian
Administrative Agent shall distribute such payments to the Lenders promptly upon
receipt in like funds as received. If any payment hereunder (other than payments
on the Eurodollar Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day, and,
with respect to payments of principal, interest thereon shall be payable at then
applicable rate during such extension. If any payment on a Eurodollar Loan
becomes due and payable on a day other than a Business Day, the maturity thereof
shall be extended to the next succeeding Business Day unless the result of such
extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business Day. In
the case of any extension of any payment of principal pursuant to the preceding
two sentences, interest thereon shall be payable at the then applicable rate
during such extension.
(b) Unless an Applicable Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to such
Applicable Agent, such applicable Agent may assume that such Lender is making
such amount available to such Applicable Agent, and such Applicable Agent may,
in reliance upon such assumption, make available to the applicable Borrower a
corresponding amount. If such amount is not made available to such Applicable
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to such Applicable Agent, on demand, such amount with interest thereon at a rate
equal to (i) in the case of amounts to be made available in Dollars, the daily
average Federal Funds Effective Rate for the period until such Lender makes such
amount immediately available to such Applicable Agent, and (ii) in the case of
amounts to be made available in Canadian Dollars, the Canadian Administrative
Agent's reasonable estimate of its average daily cost of funds. A certificate of
such Applicable Agent submitted to any Lender with respect to any amounts owing
under this subsection shall be conclusive in the absence of manifest error. If
such Lender's share of such borrowing is not made available to such Applicable
Agent by such Lender (any such Lender, a "Non-Funding Lender") within three
Business Days of such Borrowing Date, (i) the Applicable Agent shall also be
entitled to recover such amount with interest thereon at the rate per annum
applicable to ABR Loans (in the case of amounts to be made available in Dollars)
or to Canadian
48
Prime Rate Loans (in the case of amounts to be made available in Canadian
Dollars), on demand, from the applicable Borrower, (ii) the commitment
fee of such Non-Funding Lender referred to in subsection 2.7 shall not accrue
during the period commencing on such Borrowing Date and ending on the date on
which such Non-Funding Lender makes available to the Applicable Agent its share
of such borrowing and (iii) the Company shall have the right to replace such
Non-Funding Lender in accordance with subsection 2.21.
(c) Each obligation of the Loan Parties under the Loan
Documents related to any Loans or Letters of Credit denominated in Dollars
(including reimbursement obligations, interest, fees and commissions) shall be
paid in Dollars. Each obligation of the Loan Parties under the Loan Documents
related to any Loans or Letters of Credit denominated in Canadian Dollars
(including reimbursement obligations, interests, fees and commissions) shall be
paid in Canadian Dollars.
2.16 Illegality. (a) Notwithstanding any other provision
herein, if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof by any central bank or other Governmental
Authority shall make it unlawful for any Lender to make or maintain Eurodollar
Loans as contemplated by this Agreement (i) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert ABR Loans, in the case of the Company, or Canadian Base Rate Loans, in
the case of the Canadian Borrower, to Eurodollar Loans shall forthwith be
canceled; provided that any request by the relevant Borrower pursuant to
subsection 2.2 or 2.10 for a Eurodollar Loan shall, as to such Lender, be deemed
to be a request for an ABR Loan, in the case of the Company, or a Canadian Base
Rate Loan, in the case of the Canadian Borrower, and (ii) such Lender's Loans
then outstanding as Eurodollar Loans, if any, shall be converted automatically
to ABR Loans, in the case of the Company, or Canadian Base Rate Loans, in the
case of the Canadian Borrower, on the respective last days of then current
Interest Periods with respect to such Loans or within such earlier period as
required by law. If any such conversion of a Eurodollar Loan occurs on a day
which is not the last day of then current Interest Period with respect thereto,
the relevant Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to subsection 2.19.
(b) Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by any central bank or other Governmental Authority shall
make it unlawful for any Lender to create or maintain Acceptances as
contemplated by this Agreement (i) the commitment of such Lender hereunder to
accept drafts, purchase Acceptances, continue Acceptances as such and convert
Canadian Prime Rate Loans to Acceptances shall forthwith be canceled and (ii)
the full face amount of such Lender's then outstanding Acceptances, if any,
shall be converted automatically to Canadian Prime Rate Loans on the respective
maturities thereof, or within such earlier period as required by law.
2.17 Requirements of Law. (a) If the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
by any central bank or other Governmental Authority or compliance by any Lender
with any request or directive (whether or
49
not having the force of law) from any central bank or other Governmental
Authority made subsequent to the date hereof (or, if later, the date on
which such Lender becomes a Lender):
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Letter of Credit, any
Application or any Eurodollar Loan made by it, or change the basis of
taxation of payments to such Lender in respect thereof (except for
Non-Excluded Taxes and changes in the rate of net income taxes, branch
profits taxes or franchise taxes imposed in lieu of net income taxes
of such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate; or
(iii) shall impose on such Lender any other condition
(excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender reasonably deems to be material, of making,
converting into, continuing or maintaining Eurodollar Loans or issuing or
participating in Letters of Credit or to reduce any amount receivable hereunder
in respect thereof, then, in any such case, the relevant Borrower shall promptly
pay such Lender, within 15 days after receipt by such Borrower of a certificate
referred to in the second succeeding sentence, any additional amounts necessary
to compensate such Lender for such increased cost or reduced amount receivable.
If any Lender becomes entitled to claim any additional amounts pursuant to this
subsection, it shall promptly notify the relevant Borrower, through the
Applicable Agent, of the event by reason of which it has become so entitled. A
certificate as to any additional amounts payable pursuant to this subsection
(setting forth in reasonable detail the calculation of such amounts) submitted
by such Lender, through the Applicable Agent, to the relevant Borrower shall be
conclusive in the absence of manifest error. This covenant shall survive for one
hundred eighty (180) days after the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
(b) If any Lender shall have determined that the adoption of
or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof by any Governmental Authority or
compliance by such Lender or any corporation controlling such Lender with any
request, guideline or directive regarding capital adequacy (whether or not
having the force of law) from any Governmental Authority made subsequent to the
date hereof (or, if later, the date on which such Lender becomes a Lender) does
or shall have the effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder or under any
Letter of Credit to a level below that which such Lender or such corporation
could have achieved but for such change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
by an amount reasonably deemed by such Lender to be material, then from time to
time, after
50
submission by such Lender to the applicable Borrower (with a copy to the
Applicable Agent) of a written request therefor (setting forth in reasonable
detail the calculation of amounts to be paid hereunder as a result thereof),
such Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction.
2.18 Taxes. (a) All payments made by the Borrowers under this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes or branch profits taxes or franchise taxes
imposed in lieu of net income taxes imposed on any Agent or any Lender as a
result of a present or former connection between such Agent or such Lender and
the jurisdiction of the Governmental Authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from such Agent or such Lender having executed,
delivered or performed its obligations or received a payment under, or enforced,
this Agreement or any other Loan Document). If any such non-excluded taxes,
levies, imposts, duties, charges, fees deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to any Agent or any
Lender hereunder, the amounts so payable to such Agent or such Lender shall be
increased to the extent necessary to yield to such Agent or such Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement and the
Notes, provided, however, that the Borrowers shall be entitled to deduct and
withhold any Non-Excluded Taxes and neither Borrower shall not be required to
increase any such amounts payable to any Revolving Credit Lender that fails to
comply with the requirements of paragraph (b) of this subsection. Each Lender
shall promptly notify the Company of a change in such Lender's tax status that
would require a Borrower to withhold and/or pay any amounts under this paragraph
(a). Whenever any Non-Excluded Taxes are payable by a Borrower, as promptly as
possible thereafter such Borrower shall send to the Applicable Agent for its own
account or for the account of such Agent or Lender, as the case may be, a
certified copy of an original official receipt received by such Borrower showing
payment thereof. If a Borrower fails to pay any Non-Excluded Taxes when due to
the appropriate taxing authority or fails to remit to the Applicable Agent the
required receipts or other required documentary evidence within 30 days of
written request therefor by any Agent or such Lender and the date such receipt
or evidence first becomes available to such Borrower, such Borrower shall
indemnify the Agents and the Lenders for any incremental taxes, interest or
penalties that may become payable by any Agent or any Lender as a result of any
such failure. The agreements in this subsection shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
(b) Each Revolving Credit Lender that is not a United States
person as defined in Section 7701(a)(30) of the Code shall:
(X) (1) before the first payment date after it becomes a
party to this Agreement deliver to the Company and the Administrative
Agent two duly completed copies of (A) Internal Revenue Service Form
W-8BEN, in the case of a Lender claiming treaty benefits with respect
to payments under this Agreement and any Notes, or Internal
51
Revenue Service Form W-8ECI, in the case of a Lender claiming
payments under this Agreement and any Notes are effectively
connected with the conduct of a trade or business within the
United States, or successor applicable form, as the case may
be, and covering all amounts receivable by it under this Agreement
and any Notes, together with such other forms, documentation
or certifications as may be necessary to establish an available
exemption from deduction or withholding of U.S. federal income
taxes with respect to payments under this Agreement and any Notes;
(ii) deliver to the Company and the Administrative Agent two
further copies of any such form or certification on or before the date
that any such form, documentation or certification expires or becomes
obsolete and after the occurrence of any event requiring a change in
the most recent form previously delivered by it to the Company; and
(iii) obtain such extensions of time for filing and file such
forms, documentation or certifications as may reasonably be requested
by the Company or the Administrative Agent; and
(Y) in the case of any such Lender that is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code and that cannot
comply with the requirements of subsection 2.18(b)(X) above, (i)
represent to the Company (for the benefit of the Company and the
Agents) that it is not a bank within the meaning of Section
881(c)(3)(A) of the Code, (ii) agree to furnish to the Company on or
before the date of any payment by the Company, with a copy to the
Administrative Agent, (A) a certificate substantially in the form of
Exhibit H (any such certificate a "U.S. Tax Compliance Certificate")
and (B) two accurate and complete original signed copies of Internal
Revenue Service Form W-8BEN, or successor applicable form certifying
to such Lender's legal entitlement at the date of such certificate to
an exemption from U.S. withholding tax under the provisions of Section
871(h) or 881(c) of the Code with respect to payments to be made under
this Agreement and any Notes (and to deliver to the Company and the
Administrative Agent two further copies of such form on or before the
date it expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recently provided form, and, if
necessary, obtain any extensions of time reasonably requested by the
Company or the Administrative Agent for filing and completing such
forms), and (iii) agree, to the extent legally entitled to do so, upon
reasonable request by the Company, to provide to the Company (for the
benefit of the Company and the Agents) such other forms, documentation
or certification as may be reasonably required in order to establish
the legal entitlement of such Lender to an exemption from withholding
with respect to payments under this Agreement and any Notes;
unless in any such case any change in treaty, law or regulation has occurred
after the date on which such Lender becomes a Lender under this Agreement which
renders all such forms inapplicable or which would prevent such Lender from duly
completing and delivering any such form with respect to it and such Lender so
advises the Company and the Administrative Agent. Such Lender shall certify (i)
in the case of a Lender claiming treaty benefits with respect
52
payments under this Agreement and any Notes, or in the case of a Lender claiming
amounts receivable by it under this Agreement any Notes are effectively
connected with the conduct of a trade or business within the United States, that
it is entitled to receive payments under this Agreement and any Notes without
deduction or withholding of any United States federal income taxes and (ii) that
it is entitled to an exemption from United States backup withholding tax. Each
Person that shall become a Lender or a Participant pursuant to subsection 10.6
shall, upon the effectiveness of the related transfer, be required to provide
all of the forms, documentation and certifications required pursuant to this
subsection, provided that in the case of a Participant such Participant shall
furnish all such required forms, documentation and certifications to the Lender
from which the related participation shall have been purchased, and such Lender
shall in turn furnish all such required forms, documentation and certifications
to the Borrowers and the Administrative Agent, together with such other forms
(including, without limitation, Internal Revenue Service Form W-8IMY),
documentation or certifications as may be necessary to establish an available
exemption from deduction or withholding of U.S. federal income taxes on payments
under this Agreement and any Notes.
(c) If any Lender, the Administrative Agent or the Canadian
Administrative Agent shall become aware in its sole and good faith judgment that
it is entitled to receive a refund in respect of Non-Excluded Taxes as to which
it has received additional amounts from either Borrower pursuant to subsection
2.18(a), it shall promptly notify such Borrower of the availability of such
refund and within 30 days after receipt of a request by such Borrower, apply for
such refund at such Borrower's expense. If any Lender, the Administrative Agent
or the Canadian Administrative Agent receives a refund in respect of
Non-Excluded Taxes as to which it has received additional amounts from either
Borrower pursuant to subsection 2.18(a), it shall promply repay such refund to
such Borrower, provided, however, that if any Lender, the Administrative Agent
or the Canadian Administrative Agent receives a refund which it must
subsequently return to the applicable taxing authority after such Borrower has
already been repaid, such Borrower agrees to promptly return the amount of such
repayment to the Lender, the Administrative Agent or the Canadian Administrative
Agent.
(d) For the purposes of this subsection 2.18 and subsection
2.17, a change in treaty, law, rule or regulation shall not include (i) the
ratification or entry into force of the income tax treaty between the United
States and Luxembourg or (ii) the new United States withholding regulations
(Treasury Decision 8734 and Treasury Decision 8804) which become effective on
January 1, 2000.
2.19 Indemnity. Each Borrower agrees to indemnify each Lender
and to hold each Lender harmless from any reasonably foreseeable loss or expense
which such Lender may sustain or incur caused by (a) default by such Borrower in
making a borrowing of, conversion into or continuation of Eurodollar Loans after
such Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by such Borrower in making any
prepayment after such Borrower has given a notice thereof in accordance with the
provisions of this Agreement or (c) the making of a payment or prepayment of
Eurodollar Loans on a day which is not the last day of an Interest Period with
respect thereto. Such indemnification shall include an amount equal to the
excess, if any, of (i) the amount of interest
53
which would have accrued on the amount so prepaid, or not so borrowed, converted
or continued, for the period from the date of such prepayment or of such failure
to borrow, convert or continue to the last day of such Interest Period (or, in
the case of a failure to borrow, convert or continue, the Interest Period that
would have commenced on the date of such failure) in each case at the applicable
rate of interest for such Loans provided for herein (excluding, however, the
Applicable Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. This covenant shall survive
the termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.
2.20 Change of Lending Office. Each Lender agrees that, upon
the occurrence of any event giving rise to the operation of Section 2.17 or
2.18(a) with respect to such Lender, it will, if requested by a Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event, including avoiding the need
for, or reducing the amounts of, additional costs of the Borrower pursuant to
subsection 2.17 or 2.18(a); provided, that such designation is made on terms
that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this subsection shall affect or postpone any of the
obligations of either Borrower or the rights of any Lender pursuant to
subsection 2.17 or 2.18(a).
2.21 Replacement of Lenders under Certain Circumstances. Each
Borrower shall be permitted to replace any Lender (a) which requests
reimbursement for amounts owing pursuant to Section 2.17 or 2.18, (b) which
defaults in its obligation to make Loans or create Acceptances hereunder or (c)
if such Lender or its affiliated Allocation Lender shall be unable, for any
reason, to permit the Borrowers to effect a reallocation in accordance with
subsection 2.4; provided that (i) such replacement does not conflict with any
Requirement of Law, (ii) no Event of Default shall have occurred and be
continuing at the time of such replacement, (iii) prior to any such replacement,
such Lender shall not have designated a different lending office under
subsection 2.20 so as to eliminate the continued need for payment of amounts
owing pursuant to Section 2.17 or 2.18, (iv) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement, (v) such Borrower shall
be liable to such replaced Lender under subsection 2.19 if any Eurodollar Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) if the Lender to be replaced has an
Acceptance Exposure and is to be replaced on any day other than the last day of
the applicable Contract Period, such Borrower shall cash collateralize such
Acceptance Exposure in a manner acceptable to such Lender, (vii) the replacement
financial institution, if not already a Lender, shall be reasonably satisfactory
to the Administrative Agent, (viii) the replaced Lender shall be obligated to
make such replacement in accordance with the provisions of subsection 10.6
(provided that such Borrower shall be obligated to pay the registration and
processing fee referred to therein), (ix) until such time as such replacement
shall be consummated, such Borrower shall pay all additional amounts (if any)
required pursuant to subsection 2.17 or 2.18, as the case may be, (x) any such
replacement shall not be deemed to be a waiver of any rights which the
Borrowers, the Administrative Agent, the
54
Canadian Administrative Agent or any other Lender shall have against the
replaced Lender and (xi) any Lender may be replaced only if its affiliated
Allocation Lender also is replaced in accordance with this subsection 2.21, and
any replacement financial institution in respect of such Allocation Lender shall
assume, or such financial institution together with its Affiliate shall assume
on a pro rata basis, each of the Commitments of such replaced Allocation
Lenders.
SECTION 3. LETTERS OF CREDIT
3.1. L/C Commitment. (a) Subject to the terms and conditions
hereof, each Issuing Bank, in reliance on the agreements of the Lenders set
forth in subsection 3.4(a), agrees to issue letters of credit ("Letters of
Credit") for the account of a Borrower on any Business Day during the Commitment
Period in such form as may be approved from time to time by such Issuing Bank
and the Applicable Agent; provided that no Issuing Bank shall have any
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the sum of the L/C Obligations under the Revolving Credit
Commitments and the L/C Obligations under the Canadian Revolving Credit
Commitments would exceed the L/C Commitment, (ii) the aggregate Available
Revolving Credit Commitments would be less than zero or (iii) the aggregate
Available Canadian Revolving Credit Commitments would be less than zero.
(b) Letters of Credit issued for the account of the Company
shall be issued under the Revolving Credit Commitments, and Letters of Credit
issued for the account of the Canadian Borrower shall be issued under the
Canadian Revolving Credit Commitments. Each Letter of Credit issued under the
Revolving Credit Commitments shall be denominated in Dollars and each Letter of
Credit issued under the Canadian Revolving Credit Commitments shall be
denominated in Dollars or Canadian Dollars. Each Letter of Credit shall expire
no later than the earlier of (i) 365 days after its date of issuance and (ii)
five Business Days prior to the Termination Date, provided that any Letter of
Credit with a one-year term may provide for an annual renewal (which shall in no
event extend beyond the date referred to in clause (ii) above) if such renewal
is consented to by the applicable Issuing Bank and all conditions precedent to
the issuance of Letters of Credit are met at the time of such renewal.
(c) Each Letter of Credit shall be subject to the Uniform
Customs and, to the extent not inconsistent therewith, (i) if such Letter of
Credit is issued under the Revolving Credit Commitments, the laws of the State
of New York and (ii) if such Letter of Credit is issued under the Canadian
Revolving Credit Commitments, the laws of the Province of Ontario.
(d) No Issuing Bank shall at any time be obligated to issue
any Letter of Credit hereunder if such issuance would conflict with, or cause
such Issuing Bank or any Participating Bank to exceed any limits imposed by, any
applicable Requirement of Law.
(e) The letters of credit listed on Schedule IV shall be
deemed to be Letters of Credit issued under this Agreement on the Closing Date.
55
3.2. Procedure for Issuance of Letters of Credit. A Borrower
may from time to time request that an Issuing Bank issue a Letter of Credit by
delivering to such Issuing Bank (with a copy to the Applicable Agent) at its
address for notices specified herein an Application therefor, completed to the
satisfaction of such Issuing Bank and such Applicable Agent, and such other
certificates, documents and other papers and information as such Issuing Bank
may reasonably request. Upon receipt of any Application, such Issuing Bank will
process such Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall an Issuing Bank be required to issue any Letter
of Credit earlier than three Business Days after its receipt of the Application
therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Letter of Credit
to the beneficiary thereof or as otherwise may be agreed by such Issuing Bank
and the applicable Borrower. The Issuing Bank shall furnish a copy of such
Letter of Credit to the applicable Borrower and to each applicable Participating
Bank promptly following the issuance thereof.
3.3. Fees, Commissions and Other Charges. (a) Each Borrower
will pay a fee on all outstanding Letters of Credit issued for the account of
such Borrower at a per annum rate equal to the Applicable Margin then in effect
with respect to Eurodollar Loans under the Revolving Credit Facility, shared
ratably among the Revolving Credit Lenders or Canadian Revolving Credit Lenders,
as the case may be, and payable quarterly in arrears on each L/C Fee Payment
Date after the issuance date. In addition, each Borrower shall pay to the
applicable Issuing Lender for its own account a fronting fee on all outstanding
Letters of Credit issued for the account of such Borrower of 1/8 of 1% per
annum, payable quarterly in arrears on each L/C Fee Payment Date after the
Issuance Date.
(b) In addition to the foregoing fees and commissions, each
Borrower shall pay or reimburse each Issuing Bank for such normal and customary
costs and expenses as are incurred or charged by such Issuing Bank in issuing,
effecting payment under, amending or otherwise administering any Letter of
Credit issued for the account of such Borrower; provided that such costs and
expenses are not paid by such Borrower under subsections 2.19, 3.5 and/or 10.5
of this Agreement.
3.4. L/C Participations. (a) Each Issuing Bank irrevocably
agrees to grant and hereby grants to each applicable Participating Bank, and, to
induce the Issuing Banks to issue Letters of Credit hereunder, each
Participating Bank irrevocably agrees to accept and purchase and hereby accepts
and purchases from each applicable Issuing Bank, on the terms and conditions
hereinafter stated, for such Participating Bank's own account and risk an
undivided interest equal to such Participating Bank's Applicable Percentage in
the relevant Issuing Bank's obligations and rights under each Letter of Credit
issued by it hereunder in accordance with the terms hereof and the amount of
each draft paid by such Issuing Bank thereunder. Each Participating Bank
unconditionally and irrevocably agrees with each applicable Issuing Bank that,
if a draft is paid under any Letter of Credit for which such Issuing Bank is not
reimbursed in full by the applicable Borrower in accordance with the terms of
this Agreement, such Participating Bank shall pay to such Issuing Bank upon
demand at such Issuing Bank's address
56
for notices specified herein an amount equal to such Participating Bank's
Applicable Percentage of the amount of such draft, or any part thereof, which is
not so reimbursed.
(b) If any amount required to be paid by any Participating
Bank to an Issuing Bank pursuant to paragraph in respect of any unreimbursed
portion of any payment made by such Issuing Bank under any Letter of Credit is
paid to such Issuing Bank after the date such payment is due, such Participating
Bank shall pay to such Issuing Bank on demand an amount equal to the product of
(i) such amount, times (ii) (a) the daily average Federal funds rate, as quoted
by such Issuing Bank, with respect to Letters of Credit issued under the
Revolving Credit Commitments and (b) the average daily cost of funds as quoted
by such Issuing Bank with respect to Letters of Credit issued under the Canadian
Revolving Credit Commitments, in each case during the period from and including
the date such payment is required to the date on which such payment is
immediately available to such Issuing Bank, times (iii) a fraction the numerator
of which is the number of days that elapse during such period and the
denominator of which is 360. A certificate of an Issuing Bank submitted to
any Participating Bank with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error.
(c) Whenever, at any time after an Issuing Bank has made
payment under any Letter of Credit and has received from any Participating Bank
its pro rata share of such payment in accordance with subsection 3.4(a), such
Issuing Bank receives any payment related to such Letter of Credit (whether
directly from the Borrowers or otherwise, including proceeds of collateral
applied thereto by such Issuing Bank), or any payment of interest on account
thereof, such Issuing Bank will distribute to such Participating Bank its pro
rata share thereof; provided, however, that in the event that any such payment
received by an Issuing Bank shall be required to be returned by such Issuing
Bank, such Participating Bank shall return to such Issuing Bank the portion
thereof previously distributed by such Issuing Bank to it.
3.5. Reimbursement Obligation of the Borrowers. (a) Each
Borrower agrees to reimburse each Issuing Bank which has issued a Letter of
Credit for the account of such Borrower on each date on which such Issuing Bank
notifies such Borrower of the date and amount of a draft presented under any
Letter of Credit and paid by such Issuing Bank for the amount of such draft so
paid and any stamp taxes, fees, charges or other costs or expenses incurred by
such Issuing Bank in connection with such payment. Each such payment shall be
made to such Issuing Bank at its address for notices specified herein in lawful
money of the United States of America or of Canada, as the case may be, and in
immediately available funds.
(b) Subject to paragraph (c) immediately below, interest
shall be payable on any and all amounts remaining unpaid by the applicable
Borrower under this Section from the date such amounts become payable (whether
at stated maturity, by acceleration or otherwise) until payment in full at the
rate which would be payable on any outstanding (i) ABR Loans under the Revolving
Credit Facility which were then overdue in the case of Letters of Credit
denominated in Dollars and issued under the Revolving Credit Facility, (ii)
Canadian Prime Rate Loans under the Canadian Revolving Credit Facility which are
then overdue in the case of Letters of Credit denominated in Canadian Dollars
and (iii) Canadian Base Rate Loans under the Canadian Revolving Credit Facility
which are then overdue in the case of Letters of Credit denominated in Dollars
and issued under the Canadian Revolving Credit Facility.
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(c) So long as each of the conditions precedent specified in
subsection 5.3 is satisfied at such time, each drawing under any Letter of
Credit shall constitute a request by the applicable Borrower to the Applicable
Agent for a borrowing pursuant to subsection 2.2 of ABR Loans under the
Revolving Credit Facility or Canadian Prime Rate Loans or Canadian Base Rate
Loans under the Canadian Revolving Credit Facility, as the case may be, in an
amount equal to the lesser of (i) the then aggregate Available Revolving Credit
Commitments or the Available Canadian Revolving Credit Commitments, as the case
may be, and (ii) the amount of such drawing. The Borrowing Date with respect to
such borrowing shall be the date of such drawing. Each Revolving Credit Lender
or Canadian Revolving Credit Lender, as the case may be, will make the amount of
its pro rata share of such borrowing available to the Applicable Agent at its
office specified in subsection 10.2 by the close of business on such Borrowing
Date (if such Lender receives notice of such borrowing in sufficient time to
fund its portion of such borrowing on such Date, and otherwise on the next
Business Day) in funds immediately available to the Applicable Agent. Such funds
will then be made available by the Applicable Agent to the relevant Issuing Bank
in satisfaction of the applicable Borrower's obligation to reimburse such
Issuing Bank pursuant to clause (a) above. All ABR Loans deemed to be made
pursuant to this paragraph (c) shall constitute Revolving Credit Loans for all
purposes of this Agreement, and all Canadian Prime Rate Loans and Canadian Base
Rate Loans deemed made pursuant to this paragraph (c) shall constitute Canadian
Revolving Credit Loans for all purposes of this Agreement.
3.6. Obligations Absolute. (a) Each Borrower's obligations
under this Section 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any set-off, counterclaim or defense to
payment which the Borrowers may have or have had against any Issuing Bank or any
beneficiary of a Letter of Credit.
(b) Each Borrower also agrees with each Issuing Bank that
such Issuing Bank shall not be responsible for, and such Borrower's
Reimbursement Obligations under subsection 3.5(a) shall not be affected by,
among other things, (i) the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or (ii) any dispute between or among the
Borrowers and any beneficiary of any Letter of Credit or any other party
to which such Letter of Credit may be transferred or any (iii) claims
whatsoever of either Borrower against any beneficiary of such Letter of
Credit or any such transferee.
(c) No Issuing Bank shall be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit, except for
errors or omissions caused by the Issuing Bank's gross negligence or willful
misconduct.
(d) Each Borrower agrees that any action taken or omitted by
an Issuing Bank under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York (in the case of Letters of Credit
Issued under the Revolving Credit Facility) or the Uniform Customs, as published
from time to time by the International Chamber of Commerce (in the case of
Letters of Credit Issued
58
under the Canadian Revolving Credit Facility), shall be binding on such Borrower
and shall not result in any liability of such Issuing Bank to such Borrower.
3.7. Letter of Credit Payments. If any draft shall be
presented for payment under any Letter of Credit, the relevant Issuing Bank
shall promptly notify the applicable Borrower of the date and amount thereof.
The responsibility of any Issuing Bank to such Borrower in connection with any
draft presented for payment under any Letter of Credit shall, in addition to any
payment obligation expressly provided for in such Letter of Credit, be limited
to determining that the documents (including each draft) delivered under such
Letter of Credit in connection with such presentment are in conformity with the
requirements of such Letter of Credit.
3.8. Application. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Section 3, the provisions of this Section 3 shall apply.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, each Borrower hereby represents and warrants to the Agents and each
Lender that:
4.1 Financial Condition. (a) The combined balance sheets of
the Industrial Chemicals Business as at December 31, 1998 and December 31, 1997
and the combined statements of operations, changes in equity (deficit) and cash
flows for the fiscal years ended on December 31, 1998, December 31, 1997 and
December 31, 1996, reported on by Deloitte & Touche LLP, copies of which have
heretofore been furnished to each Lender, present fairly in all material
respects the consolidated financial condition of the Industrial Chemicals
Business as at such dates, and the consolidated results of its operations and
its changes in equity (deficit) and consolidated cash flows for the fiscal years
then ended.
(b) The combined pro forma balance sheet of the Industrial
Chemicals Business as of December 31, 1998 (the "Company Pro Forma Balance
Sheet"), certified by a Responsible Officer, a copy of which has heretofore been
furnished to each Lender, presents fairly in all material respects the combined
financial condition of the Industrial Chemicals Business as of December 31, 1998
after giving effect to the Spin-Off Transactions.
(c) The unaudited consolidated balance sheets of the Canadian
Borrower and its consolidated Subsidiaries as at December 31, 1998 and December
31, 1997 and the consolidated statements of operations, changes in equity
(deficit) and cash flows for the fiscal years ended on December 31, 1998 and
December 31, 1997, copies of which have heretofore been furnished to each
Lender, present fairly in all material respects the consolidated financial
condition of the Canadian Borrower and its consolidated Subsidiaries as at such
dates, and the consolidated results of their operations and their changes in
equity (deficit) and consolidated cash flows for the fiscal years then ended.
59
(d) All financial statements referred to in the preceding
paragraphs (a), (b) and (c), including the related schedules and notes thereto,
have been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by such accountants or Responsible Officer,
as the case may be, and as disclosed therein and, in the case of unaudited
financial statements, except for the absence of footnotes thereto). Neither the
Company nor any of its consolidated Subsidiaries had, at the date of the Company
Pro Forma Balance Sheet and after giving effect to the Spin-Off Transactions,
any material Guarantee Obligation, contingent liability or liability for taxes,
or any long-term lease or unusual forward or long-term commitment, including,
without limitation, any interest rate or foreign currency swap or exchange
transaction, except as reflected in the Company Pro Forma Balance Sheet or in
the notes thereto. Except as disclosed in the 1998 10-K, the Confidential
Information Memorandum or the Form 10 Filing during the period from December 31,
1998 to and including the date hereof there has been no sale, transfer or other
disposition by the Company or any of its consolidated Subsidiaries of any
material part of its business or property and no purchase or other acquisition
of any business or property (including any capital stock of any other Person)
material in relation to the consolidated financial condition of the Company and
its consolidated Subsidiaries at December 31, 1998.
4.2 No Change. Since December 31, 1998 there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect.
4.3 Corporate Existence; Compliance with Law. Each of the
Company and its Subsidiaries (other than any non-Domestic Subsidiary which is
not a Material Foreign Subsidiary) (a) is duly organized, validly existing and,
if applicable, in good standing under the laws of the jurisdiction of its
organization, (b) has the power and authority, and the legal right, to own and
operate its property, to lease the property it operates as lessee and to conduct
the business in which it is currently engaged, (c) is duly qualified as a
foreign corporation, if applicable, and, if applicable, in good standing under
the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification except to
the extent that the failure to be so qualified and in good standing could not,
in the aggregate, reasonably be expected to have a Material Adverse Effect and
(d) is in compliance with all Requirements of Law except to the extent that the
failure to comply therewith could not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.
4.4 Corporate Power; Authorization; Enforceable Obligations.
Each Loan Party has the power and authority, and the legal right, to make,
deliver and perform the Loan Documents to which it is a party and (in the case
of each Borrower) to borrow hereunder and have the Letters of Credit issued for
its account and has taken all necessary action (in the case of each Borrower) to
authorize the borrowings and the issuance of the Letters of Credit for its
account on the terms and conditions of this Agreement and the Applications and
(in the case of each Loan Party) to authorize the execution, delivery and
performance of the Loan Documents to which it is a party. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
borrowings hereunder or with the execution, delivery, performance, validity or
enforceability of the Loan Documents. This Agreement has been, and each other
Loan Document will be, duly executed and delivered on behalf of the Loan Parties
party thereto. This Agreement constitutes,
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and each other Loan Document when executed and delivered will constitute, a
legal, valid and binding obligation of the Loan Parties party thereto
enforceable against such Loan Parties in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
4.5 No Legal Bar. (a) The execution, delivery and performance
of the Loan Documents, the borrowings hereunder and the use of the proceeds
thereof, after giving effect to the Spin-Off Transactions, will not violate any
Requirement of Law or material Contractual Obligation of the Company or of any
of its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of its or their respective properties or revenues
pursuant to any such Requirement of Law or Contractual Obligation, other than
any violations or Liens that, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(b) As of the Closing Date (i) all governmental and
third-party approvals necessary or advisable in connection with the Spin-Off
Transactions, the financing contemplated in connection therewith and the
continuing operations of the Company and its Subsidiaries have been obtained,
other than any approvals that, if not obtained, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect,
and (ii) all applicable waiting periods have expired without any action being
taken or threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the Spin-Off Transactions or the
financing thereof.
4.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrowers, threatened by or against the Company or any
of its Subsidiaries or against any of its or their respective properties or
revenues (a) with respect to any of the Loan Documents or any of the
transactions contemplated hereby or (b) which could reasonably be expected to
have a Material Adverse Effect.
4.7 No Default. Neither the Company nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect which could reasonably be expected to have a Material
Adverse Effect. No Default or Event of Default has occurred and is continuing.
4.8 Ownership of Property; Liens. Each of the Company and its
Subsidiaries has (or upon the consummation of the Spin-Off Transactions will
have) good record and insurable title (and, with respect to real property
located in Canada, good and marketable title) in fee simple to, or a valid
leasehold interest in, all its material real property, and good title to, or a
valid leasehold interest in, all its other material property, and none of their
respective property is subject to any Lien except as permitted by subsection
7.3.
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4.9 Intellectual Property. The Company and each of its
Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, technology, know-how and processes necessary for the conduct of its
business as currently conducted except for those the failure to own or license
which could not reasonably be expected to have a Material Adverse Effect (the
"Intellectual Property"). No claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor do the
Borrowers know of any valid basis for any such claim, in each case, other than
those claims which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. The use of such Intellectual
Property by the Borrowers and their Subsidiaries does not infringe on the rights
of any Person, except for such claims and infringements that, in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.
4.10 Taxes. Each of the Company and its Subsidiaries has
filed or caused to be filed all U.S. federal income tax returns and all other
material tax returns which, to the knowledge of the Company, are required to be
filed and has paid all taxes shown to be due and payable on said returns or on
any assessments made against it or any of its property and all other taxes, fees
or other charges imposed on it or any of its property by any Governmental
Authority (other than those not yet delinquent, those with respect to which the
failure to pay could not reasonably be expected to have a Material Adverse
Effect and those the amount or validity of which are currently being contested
in good faith by appropriate proceedings diligently conducted and with respect
to which reserves in conformity with GAAP have been provided on the books of the
Company or its Subsidiaries, as the case may be); no tax Lien has been filed or
registered, and, to the knowledge of the Company, no claim is being asserted,
with respect to any such tax, fee or other charge.
4.11 Federal Regulations. No part of the proceeds of any
Loans will be used for "purchasing" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation U or for any
purpose which violates the provisions of the Regulations of the Board. If
requested by any Lender or the Administrative Agent, each Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form U-1 referred to in Regulation U.
4.12 ERISA; Canadian Benefit and Pension Plans. Other than
the Reportable Events resulting from the Spin-Off Transactions, neither a
Reportable Event nor an "accumulated funding deficiency" (within the meaning of
Section 412 of the Code or Section 302 of ERISA) has occurred and is continuing
on the date on which this representation is made or deemed made with respect to
any Single Employer Plan, and each Plan has complied in all material respects
with the applicable provisions of ERISA and the Code. No termination of a Single
Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen and remains in effect against the assets of the Company or any Commonly
Controlled Entity, as of each date on which this representation is made or
deemed made. The present value of all accrued benefits under each Single
Employer Plan (based on those assumptions used to fund such Plans) did not, as
of the last annual valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by an
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amount in excess of $19,000,000. Neither the Company nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any Multiemployer Plan, and
neither the Company nor any Commonly Controlled Entity would become subject to
any liability under ERISA if the Company or any such Commonly Controlled Entity
were to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. No such Multiemployer Plan is in Reorganization or Insolvent.
Notwithstanding the foregoing, there shall be no breach of the representations
set forth in this subsection 4.12 unless the amount of any liability of the
Company or any Commonly Controlled Entity which arises or which could reasonably
be expected to arise in connection with the matters giving rise to such breach,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect
(b) Schedule V sets forth, as of the Closing Date, all
Canadian Benefit Plans (other than, for greater certainty, universal plans
created by and to which the Borrowers and their respective Subsidiaries are
obligated to contribute by statute) and Canadian Pension Plans adopted by the
Borrowers and their respective Subsidiaries. The Canadian Pension Plans are duly
registered under the Income Tax Act (Canada) and all other applicable laws which
require registration and no event has occurred which is reasonably likely to
cause the loss of such registered status. All material obligations of the
Borrowers and their respective Subsidiaries (including fiduciary, funding,
investment and administration obligations) required to be performed in
connection with the Canadian Pension Plans and the funding agreements therefor
have been performed in a timely fashion. There have been no improper withdrawals
or applications of the assets of the Canadian Pension Plans or the Canadian
Benefit Plans. There are no outstanding disputes concerning the assets of the
Canadian Pension Plans or the Canadian Benefit Plans which could reasonably be
expected to have a Material Adverse Effect. On a solvency basis (using actuarial
methods and assumptions which are consistent with the valuations last filed with
the applicable Governmental Authorities and which are consistent with generally
accepted actuarial principles), none of the Canadian Pension Plans is
under-funded by more than $8,000,000.
4.13 Investment Company Act; Other Regulations. Neither
Borrower is an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
Neither Borrower is subject to regulation under any Federal or State statute or
regulation which limits its ability to incur Indebtedness.
4.14 Subsidiaries. Schedule II sets forth all the
Subsidiaries of the Company as of the Closing Date.
4.15 Purpose of Loans. The proceeds of the Loans and Letters
of Credit shall be used by each Borrower for working capital and general
corporate purposes of such Borrower, including financing Permitted Acquisitions
and Permitted Investments (and refinancing existing indebtedness in connection
with the Spin-Off Transactions).
4.16 Environmental Matters. To the best knowledge of the
Borrowers, the facilities and properties owned, leased or operated by the
Company or any of its Subsidiaries (the
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"Properties") do not contain any Hazardous Materials in amounts or
concentrations which constitute or constituted a violation of any Environmental
Law except in either case insofar as such violations in the aggregate could not
reasonably be expected to have a Material Adverse Effect.
(b) To the best knowledge of the Borrowers, the Properties
and all operations at the Properties are in compliance with all applicable
Environmental Laws except for instances of noncompliance that individually or in
the aggregate could not reasonably be expected to have a Material Adverse
Effect, and there is no contamination at, under or about the Properties nor any
violation of any Environmental Law with respect to the Properties or the
business operated by the Company or any of its Subsidiaries (the "Business")
which in the aggregate could reasonably be expected to have a Material Adverse
Effect.
(c) Neither the Company nor any of its Subsidiaries has
received any written notice of violation, alleged violation, non-compliance,
liability or potential liability regarding environmental matters or compliance
with Environmental Laws with regard to any of the Properties or the Business,
nor do the Borrowers have knowledge that any such notice will be received or is
being threatened except insofar as such notice or threatened notice, or any
aggregation thereof, does not involve a matter or matters that could reasonably
be expected to have a Material Adverse Effect.
(d) To the best knowledge of the Borrowers, no Hazardous
Materials have been transported or disposed of from the Properties in violation
of any Environmental Law, nor have any Hazardous Materials been generated,
treated, stored or disposed of at, on or under any of the Properties in
violation of any applicable Environmental Law except insofar as any such
violation or liability referred to in this paragraph, or any aggregation
thereof, could not reasonably be expected to have a Material Adverse Effect.
(e) No judicial proceeding or governmental or administrative
action is pending or, to the knowledge of the Borrowers, threatened, under any
Environmental Law to which the Company or any Subsidiary is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business except insofar
as such proceeding, action, decree, order or other requirement, or any
aggregation thereof, could not reasonably be expected to have a Material Adverse
Effect.
(f) To the best knowledge of the Borrowers, there has been no
release or threat of release of Hazardous Materials at or from the Properties,
or arising from or related to the operations of the Company or any Subsidiary in
connection with the Properties or otherwise in connection with the Business, in
violation of or in amounts or in a manner that could reasonably give rise to
liability under Environmental Laws except insofar as any such violation or
liability referred to in this paragraph, or any aggregation thereof, could not
reasonably be expected to have a Material Adverse Effect.
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4.17. Soda Ash Partners. Except as set forth in the Soda Ash
Partnership Agreement and the Soda Ash Parent Agreement, there are no
outstanding subscriptions, warrants, calls, options, rights (including
unsatisfied preemptive rights), commitments or agreements by which the Company
or any of its Subsidiaries, including Soda Ash Partners, is bound that permit or
entitle any Person to purchase or otherwise receive from or to be issued any
partnership interest in Soda Ash Partners or any security or obligation of any
kind convertible into any shares of partnership capital of Soda Ash Partners,
nor is Soda Ash Partners subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of its partnership capital.
4.18 Solvency. Each Borrower, individually and together with
its Subsidiaries, is Solvent.
4.19 Labor Matters. There are no strikes or other labor
disputes against the Company or any of its Subsidiaries pending or, to the
knowledge of the Borrowers, threatened that in the aggregate could reasonably be
expected to have a Material Adverse Effect. Hours worked by and payment made to
employees of the Company and its Subsidiaries have not been in violation of the
Fair Labor Standards Act or any other applicable Requirement of Law dealing with
such matters that in the aggregate could reasonably be expected to have a
Material Adverse Effect. All payments due from the Company or any of its
Subsidiaries on account of employee income taxes (including source deductions),
employment insurance, workers safety and insurance, employers' health tax,
vaction pay, employee health and welfare insurance and other social security or
statutory obligations that in the aggregate could reasonably be expected to have
a Material Adverse Effect if not paid have been paid or accrued as a liability
on the books of the Company or the relevant Subsidiary, and to the extent
required by GAAP.
4.20 Accuracy of Information, etc. None of this Agreement,
any other Loan Document, the Confidential Information Memorandum, the Form 10
Filing or any other document, certificate, information or statement furnished to
the Administrative Agent, the Canadian Administrative Agent or the Lenders or
any of them, by or on behalf of any Loan Party for use in connection with the
transactions contemplated by this Agreement or the other Loan Documents,
contained as of the date such statement, information, document or certificate
was so furnished (or, in the case of the Confidential Information Memorandum, as
of the date of this Agreement), any untrue statement of a material fact or, all
such material taken as a whole, omitted to state a material fact necessary in
order to make the statements contained herein or therein not misleading. The
projections and pro forma financial information contained in the materials
referenced above are based upon good faith estimates and assumptions believed by
management of the Company to be reasonable at the time made, it being recognized
by the Lenders that such financial information as it relates to future events is
not to be viewed as fact and that actual results during the period or periods
covered by such financial information may differ from the projected results set
forth therein by a material amount. There is no fact known to the Company that
could reasonably be expected to have a Material Adverse Effect that has not been
expressly disclosed herein, in the other Loan Documents, in the Confidential
Information Memorandum, the Form 10 Filing or in any other documents,
certificates and statements furnished to the Administrative Agent and the
Lenders for use in connection with the transactions contemplated hereby and by
the other Loan Documents.
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4.21 Security Documents. (a) The Guarantee and Collateral
Agreement is effective to create in favor of the Administrative Agent, for the
benefit of the Lenders, a legal, valid and enforceable security interest (or
hypothec, if applicable) in the Collateral described therein (other than the
Collateral described in subsection 3.2(l) thereof) and proceeds thereof. In the
case of the Pledged Stock described in the Guarantee and Collateral Agreement,
when stock certificates representing such Pledged Stock are delivered to the
Administrative Agent, and in the case of the other Collateral described in the
Guarantee and Collateral Agreement, when financing statements in appropriate
form are filed in the offices specified in the Guarantee and Collateral
Agreement, the Guarantee and Collateral Agreement shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral and the proceeds thereof, as security for
the Company Obligations (as defined in the Guarantee and Collateral Agreement),
in each case prior and superior in right to any other Person (except, in the
case of Collateral other than Pledged Stock, Liens permitted by subsection 7.3).
(b) Each of the Canadian Security Documents is effective to
create in favor of the Canadian Administrative Agent, for the benefit of the
Canadian Revolving Credit Lenders, a legal, valid and enforceable security
interest (or hypothec, if applicable) in the Collateral described therein and
proceeds thereof. Upon completion of the actions set forth in each Canadian
Security Document, such Canadian Security Document, shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral and the proceeds thereof, as security for
the Canadian Borrower Obligations, in each case prior and superior in right to
any other Person (except Liens permitted by subsection 7.3).
4.22 Year 2000. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (i) the Company's and its
Subsidiaries' material computer systems and material equipment containing
embedded microchips (including systems and equipment supplied by others) and the
testing of all such material systems and equipment, as so reprogrammed, are
expected by the Company to be completed by June 30, 1999, and (ii) the Company's
and its Subsidiaries' other computer systems and equipment containing embedded
microchips, and the testing of such systems and equipment, as so reprogrammed,
are expected by the Company to be completed by December 15, 1999. The cost to
the Company of such reprogramming and testing and of the reasonably foreseeable
consequences of year 2000 to the Company (including, without limitation,
reprogramming errors) will not result in a Default or a Material Adverse Effect.
Except for such of the reprogramming referred to in the preceding sentence as
may be necessary, the computer and management information systems of the Company
and its Subsidiaries are and, with ordinary course upgrading and maintenance,
will continue for the term of this Agreement to be able to interpret dates after
December 31, 1999.
4.23 Industrial Chemicals Business. On the Closing Date
(after giving effect to the Spin-Off Transactions), (a) the Industrial Chemicals
Business will be conducted by the Company and its Subsidiaries, and (b) the
Company and its Subsidiaries will be conducting no business other than the
Industrial Chemicals Business.
4.24 Senior Indebtedness. The Company Obligations constitute
"Senior Indebtedness" of the Company under and as defined in the Senior
Subordinated Note Indenture.
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SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Effectiveness. The effectiveness of this
Agreement is subject to the satisfaction of the following conditions precedent
(the date of effectiveness, the "Effective Date"):
(a) Loan Documents. The Administrative Agent shall have
received (i) this Agreement, executed and delivered by a duly
authorized officer of each Borrower, (ii) each Security Document,
executed and delivered by a duly authorized officer of each Loan
Party, and (iii) for the account of each relevant Lender, Notes
conforming to the requirements hereof and executed by a duly
authorized officer of the applicable Borrower.
(b) Related Agreements. The Administrative Agent shall have
received, with a copy for each Lender, true and correct copies,
certified as to authenticity by the Company, of the Spin-Off
Documents, the Soda Ash Partnership Agreement, the Management
Agreement and such other documents or instruments as may be reasonably
requested by the Administrative Agent, including, without limitation,
a copy of any debt instrument, security agreement or other material
contract to which the Company or its Subsidiaries may be a party.
(c) Corporate Proceedings of each Loan Party. The
Administrative Agent shall have received, with a counterpart for each
Lender, a copy of the resolutions (or comparable authorizing
document), in form and substance satisfactory to the Administrative
Agent, of the Board of Directors (or comparable governing body) of
each Loan Party authorizing (i) the execution, delivery and
performance of the Loan Documents to which it is a party, and (ii) the
granting by it of the Liens created pursuant to the Security
Documents, certified by the Secretary or an Assistant Secretary of
such Loan Party as of the Effective Date, which certificate shall be
in form and substance reasonably satisfactory to the Administrative
Agent and shall state that the resolutions thereby certified have not
been amended, modified, revoked or rescinded.
(d) Loan Party Incumbency Certificate. The Administrative
Agent shall have received, with a counterpart for each Lender, a
certificate of each Loan Party, dated the Effective Date, as to the
incumbency and signature of the officers of such Loan Party executing
any Loan Document reasonably satisfactory in form and substance to the
Administrative Agent, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of such Loan Party.
(e) Actions to Perfect Liens; Items Related to Canadian
Mortgages. (i) Each of the Administrative Agent and the Canadian
Administrative Agent shall be reasonably satisfied that all filings,
recordings, registrations and other actions (including actions
required under Canadian law), including, without limitation, the
filing of duly executed financing statements on form UCC-1, the
payment of all applicable filing and recording fees and expenses and
the delivery of stock certificates, necessary or, in the opinion of
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the Administrative Agent and the Canadian Administrative Agent,
desirable to perfect, preserve and protect the Liens created by the
Security Documents are in proper form for filing, registration,
recordation and completion, as applicable.
(ii) Except with respect to the matters to be completed after
the Closing Date in accordance with subsection 6.13, the Canadian
Administrative Agent shall have received (x) a title opinion from
counsel for the Canadian Borrower in respect of the Canadian Mortgaged
Properties reasonably satisfactory in form and substance to the
Canadian Administrative Agent and (y) evidence satisfactory to the
Canadian Administrative Agent that counterparts of the Canadian
Mortgages have been registered in all places to the extent necessary or
desirable, in the judgment of the Canadian Administrative Agent, to
create a valid and enforceable first priority Lien (subject to Liens
permitted pursuant to subsection 7.3) on each Canadian Mortgaged
Property in favor of the Canadian Administrative Agent for the benefit
of the Canadian Revolving Credit Lenders (or in favor of such other
trustee as may be required or desired under local law).
(f) Lien Searches. The Administrative Agent and the Canadian
Administrative Agent shall have received the results of a recent
search by a Person reasonably satisfactory to the Administrative Agent
and the Canadian Administrative Agent of the Uniform Commercial Code,
judgment and tax lien filings (and equivalent searches under Canadian
law) which may have been filed with respect to personal property of
the Holdings and its Subsidiaries, and such search shall reveal no
Liens other than Liens permitted by subsection 7.3 or otherwise
satisfactory to the Lenders.
(g) Financial Statements. The Lenders shall have received the
financial statements of the Company and the Canadian Borrower referred
to in subsection 4.1.
(h) Solvency. The Administrative Agent shall have received a
solvency opinion from an independent valuation firm reasonably
satisfactory to the Administrative Agent, in form and substance
satisfactory to the Lenders, as to the Solvency of the Company and its
Subsidiaries after giving effect to the Spin-Off and the other
transactions contemplated hereby.
(i) Business Plan. The Lenders shall have received a
certificate of a Responsible Officer of the Company confirming that
there has been no material change to the detailed business plan for
each fiscal year from 1999 through and including 2003 and the written
analysis of the business and prospects of each Borrower and its
Subsidiaries through the Termination Date previously delivered to the
Lenders.
(j) Environmental Report. The Administrative Agent shall have
received a Phase I environmental audit with respect to Soda Ash
Partner's Amherstburg and Green River chemical plants from an
independent environmental consulting firm reasonably satisfactory to
the Administrative Agent, in form and substance satisfactory to the
Lenders.
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(k) Conditions to Spin-Off. The Separation shall have been
completed and each of the other conditions to the consummation of the
Spin-Off set forth in Section 3.06 of the Separation Agreement (other
than the completion of the Refinancing Transactions and the NHO
Distribution) shall have been satisfied, including, but not limited
to, the condition that the IRS Ruling shall not have been withdrawn or
modified and shall be in full force and effect.
(l) Ratings Letter. The Administrative Agent shall have
received a copy of a letter from S&P or Moody's, as the case may be,
addressed to the Company and confirming that the Facilities have been
assigned a rating of at least B+ by S&P or at least B1 by Moody's.
(m) Insurance. The Administrative Agent shall have received
insurance certificates satisfying the requirements of subsection
5.2(b) of the Guarantee and Collateral Agreement, subsection 6.2(2) of
the Canadian Guarantee and Collateral Agreement and subsection 13(4)
of the Fixed and Floating Charge Debenture.
5.2 Conditions to Initial Loans and Letters of Credit. The
obligation of each Lender to make its initial Loans and the obligation of each
Issuing Lender to issue its initial Letter of Credit are subject to the
satisfaction, immediately prior to or concurrently with the making of such Loans
or the issuance of such Letter of Credit, as the case may be, of the following
conditions precedent (the date of the initial Extensions of Credit, the "Closing
Date"):
(a) Effective Date. The conditions set forth in subsection
5.1 shall have been satisfied in accordance with the terms hereof.
(b) Consummation of Spin-Off. Concurrently with the initial
borrowing hereunder by the Canadian Borrower, the Refinancing
Transactions shall be completed and thereupon the NHO Distribution
shall be effected and the Spin-Off shall be consummated, in all
material respects in accordance with the Form 10 Filing and the
Separation Agreement, and neither the Form 10 Filing nor the
Separation Agreement shall have been amended in any manner which has
had a material adverse effect on the structure or syndication of, or
the credit analysis with respect to, the Facilities without the
consent of the Administrative Agent. Upon the consummation of the
Spin-Off, the corporate and capital structure of Holdings and each
Loan Party shall be, in all material respects, as set forth in the
Form 10 Filing.
(c) Legal Opinions. The Administrative Agent shall have
received, with a counterpart for each Lender, the following executed
legal opinions:
(i) the executed legal opinion of Debevoise & Plimpton,
special counsel to the Borrowers and the other Loan Parties,
substantially in the form of Exhibit A-1;
69
(ii) the executed legal opinion of Blake, Cassels & Graydon,
special counsel to the Canadian Borrower and the other Loan Parties,
substantially in the form of Exhibit A-2;
(iii) the executed legal opinion of Michael R. Herman,
General Counsel of the Company, substantially in the form of Exhibit
A-3;
(iv) the executed legal opinion of local counsel in New
Jersey, in form and substance satisfactory to the Administrative
Agent; and
(v) the executed legal opinion of Kirwin Partners, in form
and substance satisfactory to the Canadian Administrative Agent, with
respect to the Canadian Mortgaged Properties.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative
Agent may reasonably require.
(d) Fees. The Administrative Agent, the Canadian
Administrative Agent, the Syndication Agent, the Documentation Agent
and the Lenders shall have received all fees to be received from, or
reimbursed to them by, Holdings or the Borrowers on the Closing Date.
5.3 Conditions to Each Extension of Credit. The agreement of
each Lender and each Issuing Bank to make any extension of credit requested to
be made by it on any date (including, without limitation, its initial extension
of credit) is subject to the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrowers and the other
Loan Parties in or pursuant to the Loan Documents shall be true and
correct in all material respects on and as of such date as if made on
and as of such date (except for changes permitted by this Agreement
and except that representations and warranties originally made as of a
specified date shall be true and correct as of such specified date).
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
extensions of credit requested to be made on such date.
Each borrowing by a Borrower hereunder, each issuance of a Letter of Credit
hereunder and the effectiveness of this Agreement under subsection 5.1, shall
constitute a representation and warranty by each Borrower as of the date of such
extension of credit or such initial effectiveness under subsection 5.1, as the
case may be, that the conditions contained in this subsection 5.3 have been
satisfied. No event shall be deemed an extension of credit unless such event
results in an increase in the total principal amount of Loans outstanding or in
the total face amount of Letters of Credit outstanding.
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SECTION 6. AFFIRMATIVE COVENANTS
The Borrowers hereby agree that, so long as the Commitments
remain in effect, any Note or any Letter of Credit remains outstanding and
unpaid or any other amount is owing to any Lender, the Administrative Agent or
the Canadian Administrative Agent hereunder, each Borrower (or, in the case of
subsection 6.13, the Canadian Borrower) shall and (except in the case of
delivery of financial information, reports and notices and the matters set forth
in subsection 6.13) shall cause each of its Subsidiaries to:
6.1 Financial Statements. Furnish to each Lender:
(a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Company, a copy of the
consolidated balance sheet of the Company, and the related
consolidated statements of operations, changes in equity (deficit) and
cash flows for such year, setting forth in each case in compare form
the figures for the previous year, reported on, without a "going
concern" or like qualification or exception, or qualification arising
out of the scope of the audit, by Deloitte & Touche LLP or other
independent certified public accountants of nationally recognized
standing;
(b) as soon as available, but in any event not later than 60
days after the end of each of the first three quarterly periods of
each fiscal year of the Company (commencing with the second quarterly
period of the 1999 fiscal year), the unaudited consolidated balance
sheet of the Company and its consolidated Subsidiaries as at the end
of such quarter and the related unaudited consolidated statements of
operations, changes in equity (deficit) and cash flows for such
quarter and the portion of the fiscal year through the end of such
quarter, setting forth in each case in compare form the figures for
the previous year, certified by a Responsible Officer as being fairly
stated in all material respects (subject to normal year-end audit
adjustments) and as having been prepared in accordance with GAAP
applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such officer and disclosed
therein); and
(c) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Canadian Borrower, a copy of
the consolidated balance sheet of the Canadian Borrower as at the end
of such year and the related consolidated statements of operations,
changes in equity (deficit) and cash flows for such year, setting
forth in each case in compare form the figures for the previous year;
and
(d) as soon as available, but in any event not later than 60
days after the end of each of the first three quarterly periods of
each fiscal year of the Canadian Borrower (commencing with the second
quarterly period of the 1999 fiscal year), the unaudited consolidated
balance sheet of the Canadian Borrower and its consolidated
Subsidiaries as at the end of such quarter and the related unaudited
consolidated statements of operations, changes in equity (deficit) and
cash flows for such quarter and the portion of the fiscal year through
the end of such quarter, setting forth in each case in comparative
form the figures for the previous year, certified by a Responsible
Officer as being fairly
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stated in all material respects (subject to normal year-end audit
adjustments) and as having been prepared in accordance with GAAP
applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such officer and disclosed
therein).
All such financial statements shall present fairly in all material respects the
consolidated financial condition of each of the Company and the Canadian
Borrower and their respective consolidated Subsidiaries as at the applicable
dates, and the consolidated results of their operations, their changes in equity
(deficit) and their consolidated cash flows for the periods reflected therein,
and shall be prepared in reasonable detail and in accordance with GAAP applied
consistently throughout the periods reflected therein and with prior periods
(except as approved by such accountants or officer, as the case may be, and
disclosed therein).
6.2 Certificates; Other Information. Furnish to each Lender:
(a) concurrently with the delivery of the financial
statements referred to in subsection 6.1(a), a certificate of the
independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefor
such accountants obtained no knowledge of any Default or Event of
Default, except as specified in such certificate;
(b) concurrently with the delivery of the financial
statements referred to in subsections 6.1(a) and 6.1(b), a Compliance
Certificate, executed by a Responsible Officer, (i) demonstrating
compliance with the covenants contained in subsections 7.1, 7.2(g),
7.2(j), 7.6, 7.8, 7.9, 7.10(g) and 7.10(i), (ii) setting forth
calculations of the Interest Coverage Ratio, the Leverage Ratio and
the Senior Leverage Ratio as of the last day of the most recent fiscal
quarter covered by such financial statements and (iii) stating that,
to the best of such Responsible Officer's knowledge, the Company
during such period has observed or performed all of its covenants and
other agreements, and satisfied every condition, contained in this
Agreement and in the other Loan Documents to which it is a party to be
observed, performed or satisfied by it, and that such Officer has
obtained no knowledge of any Default or Event of Default except as
specified in such certificate;
(c) within five days after the same are filed, copies of all
financial statements and reports which Holdings, Intermediate Holdings
or the Company may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental Authority; and
promptly, all press releases and other written statements made
available generally by Holdings, Intermediate Holdings, the Company or
any of its Subsidiaries to the public concerning material developments
in the business of the Company or any of its Subsidiaries;
(d) promptly upon receipt thereof, copies of all reports
submitted to the Company by its independent certified public
accountants in connection with each annual, interim or special audit
of the financial statements of the Company made by such accountants,
including, without limitation, the comment letter submitted by such
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accountants to management in connection with their annual audit; and
the Company agrees to obtain such a letter in connection with each of
its annual audits;
(e) if requested by the Administrative Agent, promptly after
the filing thereof by a Borrower or any of its Subsidiaries with any
applicable Governmental Authority, copies of each annual and other
return, report or valuation with respect to each Canadian Pension
Plan; and
(f) promptly, such additional financial and other information
as any Lender may from time to time reasonably request.
6.3 Payment of Obligations. Pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, all its material obligations of whatever nature, except where the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings diligently conducted and reserves in conformity with GAAP with
respect thereto have been provided on the books of the Company or its
Subsidiaries, as the case may be.
6.4 Conduct of Business and Maintenance of Existence.
Continue to engage in business primarily of the same general types as now
conducted by it or in any Related Business and preserve, renew and keep in full
force and effect the corporate existence of each Borrower and each Material
Subsidiary; and take all reasonable action to maintain all rights, privileges
and franchises necessary or desirable in the normal conduct of its business,
except as otherwise permitted pursuant to subsection 7.5, and comply with all
Contractual Obligations and Requirements of Law except to the extent that
failure to maintain such rights, privileges and franchises and to comply with
Contractual Obligations and Requirements of Law could not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance. Keep all material
property useful and necessary in its business in good working order and
condition; maintain with financially sound and reputable insurance companies
insurance (to the extent available at commercially reasonable rates) on all its
property in at least such amounts and against at least such risks as are usually
insured against in the same general area by companies engaged in the same or a
similar business; and furnish to each Lender, upon written request, full
information as to the insurance carried.
6.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and correct entries
in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities; and permit
representatives of any Lender upon reasonable prior notice and at reasonable
times to visit and inspect any of its properties and examine and make abstracts
from any of its books and records at any reasonable time and as often as may
reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Company and its Subsidiaries with officers
and employees of the Company and its Subsidiaries and with its independent
certified public accountants (each Lender will, in accordance with subsection
10.15, maintain the confidentiality of all information obtained by it pursuant
to this subsection 6.6).
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6.7 Notices. Promptly give notice to the Administrative
Agent, the Canadian Administrative Agent and each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any default or event of default under any Contractual
Obligation of Holdings or any or any of its Subsidiaries which if not
cured could reasonably be expected to have a Material Adverse Effect;
(c) any litigation, investigation or proceeding affecting
Holdings or any of its Subsidiaries (i) which is reasonably likely to
involve a payment of $10,000,000 or more not covered by insurance,
(ii) in which injunctive or similar relief reasonably likely to have a
Material Adverse Effect is reasonably likely to be obtained or (iii)
which if not cured or if adversely determined, as the case may be,
could reasonably be expected to have a Material Adverse Effect;
(d) (i) the following events, as soon as possible and in any
event within 30 days after the Company knows or has reason to know
thereof: (x) the occurrence or expected occurrence of any Reportable
Event (other than Reportable Events resulting from the Spin-Off
Transactions) with respect to any Plan, a failure to make any required
contribution to a Plan, the creation of any Lien in favor of the PBGC
or a Plan or any withdrawal from, or the termination, Reorganization
or Insolvency of, any Multiemployer Plan or (y) the institution of
proceedings or the taking of any other action by the PBGC or the
Company or any Commonly Controlled Entity or any Multiemployer Plan
with respect to the withdrawal from, or the terminating,
Reorganization or Insolvency of, any Plan and (ii) (w) any failure to
make a contribution to any Canadian Pension Plan required by the terms
of such plan or applicable law, in a timely manner, (x) any
termination of any Canadian Pension Plan, (y) any material direction,
order, notice, ruling or opinion that the Borrowers or any of their
Subsidiaries shall receive from from any applicable Governmental
Authority indicating that any Canadian Pension Plan is in default
under any applicable law, together with a copy thereof, and (z) if
requested by the Administrative Agent, a copy of any actuarial report
prepared in respect of any Canadian Pension Plan; and
(e) any development or event known to the Company which could
reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Company proposes to take with respect thereto.
6.8 Environmental Laws. (a) Comply with, and ensure
compliance by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply with and maintain, and ensure that all
tenants and subtenants obtain and comply with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
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applicable Environmental Laws, except for such instances of noncompliance that,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(b) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws, except for instances in which the obligation to comply or to conduct such
investigations, studies, sampling, testing or remedial actions is being
contested in good faith before a court or administrative body of competent
jurisdiction or in which the failure to so comply or to conduct such activities
in the aggregate could not reasonably be expected to have a Material Adverse
Effect.
6.9 Further Assurances. At any time and from time to time,
upon the Administrative Agent's request and at the expense of the Company,
promptly and duly execute and deliver or cause to be executed and delivered any
and all further instruments and documents and take such further action as the
Administrative Agent may reasonably request to effect the purpose of the
Security Documents, including, without limitation, the filing of any financing
or continuation statements under the Uniform Commercial Code or other applicable
laws in effect in any jurisdiction.
6.10 Additional Collateral. (a) With respect to any property
acquired after the Closing Date by the Company or any Subsidiary Guarantor
(other than (x) any property described in paragraph (b), (c), (d), (e), (f) or
(g) below, (y) any property subject to a Lien expressly permitted by subsection
7.3(g) and (z) property acquired by any Foreign Subsidiary) as to which the
Administrative Agent, for the benefit of the Lenders, does not have a perfected
Lien, promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement or such other documents as
the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a security interest in
such property and (ii) take all actions necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a perfected first priority
security interest in such property, including the filing of Uniform Commercial
Code financing statements in such jurisdictions as may be required by the
Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent.
(b) With respect to any fee interest in any real property
having a value (together with improvements thereof) of at least $500,000
acquired after the Closing Date by the Company or any Subsidiary Guarantor
(other than (x) any such real property subject to a Lien expressly permitted by
Section 7.3(g) and (z) real property acquired by any Foreign Subsidiary),
promptly (i) execute and deliver a first priority mortgage or deed of trust, as
applicable, in favor of the Administrative Agent, for the benefit of the
Lenders, covering such real property, (ii) if requested by the Administrative
Agent, provide the Lenders with (x) title and extended coverage insurance
covering such real property in an amount at least equal to the purchase price of
such real property (or such other amount as shall be reasonably specified by the
Administrative Agent) as well as a current ALTA survey thereof, together with a
surveyor's certificate and (y) any consents or estoppels reasonably deemed
necessary or advisable by the Administrative Agent in connection with such
mortgage or deed of trust, each of the foregoing in form and substance
reasonably
75
satisfactory to the Administrative Agent and (iii) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(c) With respect to any new Subsidiary (other than a Foreign
Subsidiary or Foreign Subsidiary Holding Company) created or acquired after the
Closing Date (which, for the purposes of this paragraph, shall include any
existing Subsidiary that ceases to be a Foreign Subsidiary or that becomes a
Subsidiary described in clause (a) of the definition of "Subsidiary Guarantor"),
by the Company or any Subsidiary Guarantor, promptly (i) execute and deliver to
the Administrative Agent such amendments to the Guarantee and Collateral
Agreement as the Administrative Agent deems necessary or advisable to grant to
the Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary which is
owned by the Company or any Subsidiary Guarantor, (ii) deliver to the
Administrative Agent the certificates representing such Capital Stock, together
with undated stock powers, in blank, executed and delivered by a duly authorized
officer of the Company or such Subsidiary Guarantor, as the case may be, (iii)
if 80% or more of the Equity Interests of such new Subsidiary are owned,
directly or indirectly (other than indirectly through any Foreign Subsidiary) by
the Company or any Subsidiary Guarantor, cause such new Subsidiary (A) to become
a party to the Guarantee and Collateral Agreement and (B) to take such actions
necessary or reasonably advisable to grant to the Administrative Agent for the
benefit of the Lenders a perfected first priority security interest in the
Collateral described in the Guarantee and Collateral Agreement with respect to
such new Subsidiary, including, without limitation, the filing of Uniform
Commercial Code financing statements in such jurisdictions as may be required by
the Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent, and (iv) if requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance reasonably satisfactory to
the Administrative Agent.
(d) With respect to any new Foreign Subsidiary or Foreign
Subsidiary Holding Company (other than any Excluded Issuer) created or acquired
after the Closing Date by the Company or any Subsidiary Guarantor, promptly (i)
execute and deliver to the Administrative Agent such amendments to the Guarantee
and Collateral Agreement as the Administrative Agent deems necessary or
advisable in order to grant to the Administrative Agent, for the benefit of the
Lenders, a perfected first priority security interest in the Capital Stock of
such new Foreign Subsidiary which is owned by the Company or any Subsidiary
Guarantor (provided that in no event shall more than 65% of the total
outstanding Capital Stock of any such new Subsidiary be required to be so
pledged), (ii) deliver to the Administrative Agent the certificates representing
such Capital Stock, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the Company or such Subsidiary
Guarantor, as the case may be, and take such other action as may be necessary
or, in the opinion of the Administrative Agent, desirable under applicable law
to perfect the Lien of the Administrative Agent thereon, and (iii) if requested
by the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
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(e) With respect to any property acquired after the Closing
Date by the Canadian Borrower or any Canadian Subsidiary Guarantor (other than
any property subject to a Lien expressly permitted by subsection 7.3(g)) as to
which the Canadian Administrative Agent, for the benefit of the Canadian
Revolving Credit Lenders, does not have a perfected Lien, promptly (i) execute
and deliver to the Canadian Administrative Agent such amendments to the Canadian
Guarantee and Collateral Agreement or such other documents as the Canadian
Administrative Agent deems necessary or advisable to grant to the Canadian
Administrative Agent, for the benefit of the Canadian Revolving Credit Lenders,
a security interest in such property and (ii) take all actions necessary or
advisable to grant to the Canadian Administrative Agent, for the benefit of the
Canadian Revolving Credit Lenders, a perfected first priority security interest
(or hypothec, if applicable) in such property, including filings and other
actions as may be required by the Canadian Guarantee and Collateral Agreement or
by law or as may be requested by the Canadian Administrative Agent.
(f) With respect to any fee or similar ownership interest in
any real property having a value (together with improvements thereof) of at
least $500,000 or the equivalent amount thereof in Canadian Dollars acquired
after the Closing Date by the Canadian Borrower or any of its Subsidiaries
(other than any such real property subject to a Lien expressly permitted by
Section 7.3(g)), promptly (i) execute and deliver a first priority mortgage,
deed of trust or hypothec, as applicable, in favor of the Canadian
Administrative Agent, for the benefit of the Canadian Revolving Credit Lenders,
or in favor of the Canadian Revolving Credit Lenders (if such real property is
located in the Province of Quebec) covering such real property, (ii) if
requested by the Canadian Administrative Agent, provide the Canadian Revolving
Credit Lenders with (x) title and extended coverage insurance covering such real
property in an amount at least equal to the purchase price of such real property
(or such other amount as shall be reasonably specified by the Canadian
Administrative Agent) as well as a current as-built survey thereof, together
with a surveyor's certificate, and (y) any consents or estoppels reasonably
deemed necessary or advisable by the Canadian Administrative Agent in connection
with such mortgage, deed of trust or hypothec, each of the foregoing in form and
substance reasonably satisfactory to the Canadian Administrative Agent, and
(iii) if requested by the Canadian Administrative Agent, deliver to it legal
opinions relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the Canadian
Administrative Agent.
(g) With respect to any new Subsidiary created or acquired
after the Closing Date (which, for the purposes of this paragraph, shall include
any existing Subsidiary that becomes a Subsidiary described in clause (a) of the
definition of "Canadian Subsidiary Guarantor") by the Canadian Borrower or any
Canadian Subsidiary Guarantor, promptly (i) execute and deliver to the Canadian
Administrative Agent such amendments to the Canadian Guarantee and Collateral
Agreement as the Canadian Administrative Agent deems necessary or advisable in
order to grant to the Canadian Administrative Agent, for the benefit of the
Canadian Revolving Credit Lenders, a perfected first priority security interest
in the Capital Stock of such new Subsidiary which is owned by the Canadian
Borrower or any Canadian Subsidiary Guarantor, (ii) if 80% or more of the Equity
Interests of such new Subsidiary are owned by the Canadian Borrower or any
Canadian Subsidiary Guarantor, cause such new Subsidiary (A) to
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become a party to the Canadian Guarantee and Collateral Agreement, (B) to comply
with the terms and provisions of the Canadian Guarantee and Collateral Agreement
with respect to the registration of shares of such Capital Stock and the
delivery to the Canadian Administrative Agent of certificates representing such
Capital Stock, and (C) to take such other actions as may be necessary or
advisable to grant to the Canadian Administrative Agent, for the benefit of the
Canadian Revolving Credit Lenders, a perfected first priority security interest
in the Collateral described in the Canadian Guarantee and Collateral Agreement
with respect to such new Subsidiary, and (iii) if requested by the Canadian
Administrative Agent, deliver to the Canadian Administrative Agent legal
opinions relating to the matters described above, which opinions shall be in
form and substance reasonably satisfactory to the Canadian Administrative Agent.
6.11 GC Canada Senior Notes. Cause the GC Canada Senior
Notes to be redeemed in full on or prior to May 15, 1999 and notify the
Administrative Agent of such redemption promptly following the occurrence
thereof.
6.12 Canadian Pension Plans and Benefit Plans. (a) For each
Canadian Pension Plan existing on the Effective Date, ensure that such plan
retains its registered status (except to the extent that the Borrowers shall
have given notice of the termination of such plan in accordance with subsection
6.7(d)) under and is administered in a timely manner in all respects in
accordance with the applicable pension plan text, funding agreement, the Income
Tax Act (Canada) and all other applicable laws.
(b) For each Canadian Pension Plan hereafter adopted by the
Borrowers and their Subsidiaries which is required to be registered under the
Income Tax Act (Canada) or any other applicable laws, use its best efforts to
seek and receive confirmation in writing from the applicable Governmental
Authorities to the effect that such plan is unconditionally registered under the
Income Tax Act (Canada) and such other applicable laws.
(c) For each Canadian Pension Plan and Canadian Benefit Plan
hereafter adopted by the Borrowers and their Subsidiaries, in a timely fashion
perform in all material respects all obligations (including fiduciary, funding,
investment and administration obligations) required to be performed in
connection with such plan and the funding media therefor.
6.13 Post-Closing Real Estate Matters. (a) Use its best
efforts to obtain, deliver and register, on or prior to May 21, 1999, at its
sole expense, discharges of claims for lien and orders vacating certificates of
action, as mutually agreed upon by the Canadian Administrative Agent and the
Canadian Borrower on the Closing Date, and deliver evidence, in form and
substance reasonably satisfactory to the Canadian Administrative Agent, that
such claims for lien and certificates of action have been discharged and
vacated.
(b) Within 60 days following the Closing Date, deliver to the
Canadian Administrative Agent an up-to-date survey for each of the Canadian
Mortgaged Properties prepared, signed and sealed by an Ontario Land Surveyor,
setting out bearings, boundaries and dimensions of the lands, front, rear and
side yard dimensions and setbacks, the location of monuments and the buildings
on the lands, the location of entrances to and exits from the lands,
78
all rights-of-way and easements referable to the lands, any encroachments over
the locations and the location of all fences on or separating the lands from
adjacent lands, together with a surveyor's certificate setting out the area of
the lands, or as otherwise reasonably acceptable to the Canadian Administrative
Agent.
(c) On or prior to June 4, 1999 (subject to the customary
cooperation of all relevant third parties), cause to be delivered to the
Canadian Administrative Agent a summary of all off-title search results with
respect to the Canadian Mortgaged Properties as reasonably requested by the
Canadian Administrative Agent.
(d) Within 60 days following the Closing Date, cause to be
delivered to the Canadian Administrative Agent with respect to the Canadian
Mortgaged Property known as the "settling ponds/basins" located in Amherstburg,
Ontario, the items listed in subsection 5.1(e)(ii).
(e) Within 150 days following the Closing Date, obtain and
deliver to the Canadian Administrative Agent a title opinion of Kirwin &
Partners in form and substance satisfactory to the Canadian Administrative Agent
in respect of each of the Canadian Mortgaged Properties, including, without
limitation, confirmation that: (i) subject to (x) the items (a) through (f) set
forth in paragraph (2) of the opinion of Kirwin & Partners delivered on the
Closing Date pursuant to subsection 5.2(c)(v) and item (h) set forth in such
paragraph (2) (unless the Canadian Borrower has failed to use best efforts to
eliminate the exception set forth in such item (h)) and (y) Liens permitted
pursuant to subsection 7.3, the Canadian Borrower has good and marketable title
in fee simple to the Canadian Mortgaged Properties and that no part thereof has
been forfeited to the Crown and (ii) to the extent records are available from
the applicable governmental agency, each of the corporate owners in the chain of
title was validly subsisting during its period of ownership.
(f) Undertake to execute and deliver additional security
documents, together with legal opinions in respect thereof, in form and
substance as reasonably requested by counsel to the Canadian Administrative
Agent, in order to perfect the Liens granted on property of the Canadian
Borrower under the Canadian Security Documents to the extent that such property
is located outside of Ontario, within 10 Business Days of receipt of such
request by the Canadian Borrower.
SECTION 7. NEGATIVE COVENANTS
Each Borrower hereby agrees that, so long as the Revolving
Credit Commitments and the Canadian Revolving Credit Commitments remain in
effect, any Loans, any Letter of Credit or Reimbursement Obligations remains
outstanding and unpaid or any other amount is owing to any Lender, the
Administrative Agent or the Canadian Administrative Agent hereunder, such
Borrower shall not, and (except with respect to subsection 7.1) shall not permit
any of its Subsidiaries to, directly or indirectly:
7.1 Financial Condition Covenants.
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(a) Senior Leverage Ratio. Permit the Senior Leverage Ratio
as at the last day of any fiscal quarter of the Company occurring
during any period set forth below to be greater than the ratio set
forth below opposite such period:
Period Senior Leverage Ratio
July 1, 1999 - December 31, 1999 2.50 : 1.00
January 1, 2000 - December 31, 2000 2.25 : 1.00
January 1, 2001 - December 31, 2001 2.00 : 1.00
January 1, 2002 - December 31, 2002 2.00 : 1.00
January 1, 2003 - Termination Date 2.00 : 1.00.
(b) Leverage Ratio. Permit the Leverage Ratio as at the last
day of any fiscal quarter of the Company occurring during any period
set forth below to be greater than the ratio set forth below opposite
such period:
Period Leverage Ratio
July 1, 1999 - December 31, 1999 5.40 : 1.00
January 1, 2000 - December 31, 2000 5.25 : 1.00
January 1, 2001 - December 31, 2001 5.00 : 1.00
January 1, 2002 - December 31, 2002 5.00 : 1.00
January 1, 2003 - Termination Date 5.00 : 1.00.
(c) Interest Coverage Ratio. Permit the Interest Coverage
Ratio as at the last day of any fiscal quarter of the Company
occurring during any period set forth below to be less than the ratio
set forth below opposite such period:
Period Interest Coverage Ratio
July 1, 1999 - December 31, 1999 1.60 : 1.00
January 1, 2000 - December 31, 2000 1.75 : 1.00
January 1, 2001 - December 31, 2001 2.00 : 1.00
January 1, 2002 - December 31, 2002 2.25 : 1.00
January 1, 2003 - Termination Date 2.25 : 1.00.
7.2 Limitation on Indebtedness. Create, incur, assume or
suffer to exist any Indebtedness, except:
(a) (i) Indebtedness of the Borrowers under this Agreement
and (ii) Indebtedness of the Company in respect of the Senior
Subordinated Notes in an aggregate principal amount not to exceed
$100,000,000;
(b) subject to subsection 6.11, Indebtedness of the Canadian
Borrower under the GC Canada Senior Notes in an aggregate principal
amount not to exceed $52,000,000 as long as such Indebtedness is fully
defeased or cash collateralized;
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(c) Indebtedness of the Company to any Subsidiary and of any
Subsidiary to the Company or any other Subsidiary; provided that any
such Indebtedness of a Subsidiary (other than the Canadian Borrower,
any Subsidiary Guarantor or any Canadian Subsidiary Guarantor) to the
Company, a Subsidiary Guarantor or a Canadian Subsidiary Guarantor
shall be evidenced by a non-negotiable senior promissory note having
terms reasonably satisfactory to the Administrative Agent;
(d) Indebtedness of a Person which becomes a Subsidiary after
the date hereof, provided that (i) such Indebtedness existed at the
time such corporation became a Subsidiary and was not created in
anticipation thereof and (ii) immediately after giving effect to the
acquisition of such Person by the Company, no Default or Event of
Default shall have occurred and be continuing;
(e) (i) Interest Rate Protection Obligations of the Company
entered into to hedge actual interest rate exposure and not for
speculative purposes to the extent that the notional principal amount
thereof does not exceed the amount of Indebtedness being hedged, (ii)
Interest Rate Protection Obligations of the Canadian Borrower entered
into to hedge actual interest rate exposure and not for speculative
purposes to the extent that the notional principal amount thereof does
not exceed the amount of Indebtedness being hedged and (iii) Guarantee
Obligations (x) by Subsidiaries of the Company in respect of the
Company's obligations described in the preceding clause (i) and (y) by
the Company or any Subsidiary of the Canadian Borrower's obligations
described in the preceding clause (ii) as long as the aggregate amount
of such Guarantee Obligations described in this clause (iii) (as
measured by the relevant swap termination values) does not exceed
$2,500,000;
(f) Indebtedness under Currency Agreements; provided that in
the case of Currency Agreements which relate to Indebtedness, such
Currency Agreements do not increase the Indebtedness of the Company or
the Canadian Borrower outstanding other than as a result of
fluctuations in foreign currency exchange rates or by reason of fees,
indemnities and compensation payable thereunder;
(g) Indebtedness of the Company or any of its Subsidiaries
incurred to finance the acquisition of fixed or capital assets
(whether pursuant to a loan, a Financing Lease or otherwise) in an
aggregate principal amount at any time outstanding not exceeding as to
the Company and its Subsidiaries the greater of (x) $15,000,000 and
(y) 5% of Consolidated Tangible Assets;
(g-1) obligations of the Company or any Subsidiary under
energy or commodity hedge, exchange or similar agreements entered into
in the ordinary course of business for the purpose of hedging the risk
to the Company and its Subsidiaries of fluctuations in the cost of
natural gas, other energy inputs or commodities used in the ordinary
course of business of the Company and its Subsidiaries;
81
(h) Indebtedness of the Company or any of its Subsidiaries at
any time outstanding incurred in the ordinary course of business in
respect of reclamation bonds, performance bonds, letters of credit and
surety bonds provided by the Company or any of its Subsidiaries
required by and in compliance with the applicable statutes or laws of
the relevant jurisdiction or by relevant Governmental Authorities;
(i) Indebtedness outstanding on the date hereof and listed on
Schedule III and, until the Closing Date, Indebtedness outstanding
under the Existing Credit Agreement;
(j) Indebtedness of the Company or any of its Subsidiaries
not otherwise permitted under this subsection 7.2 in an aggregate
principal amount not to exceed $25,000,000 at any time outstanding;
and
(k). any Indebtedness ("Refinancing Indebtedness") incurred
in connection with the extension, renewal, substitution, refinancing
or replacement of any Indebtedness referred to in clauses (a)(ii) and
(b) through (i) above; provided that (i) the principal amount of such
Refinancing Indebtedness does not exceed the aggregate principal
amount of, plus accrued interest on, the Indebtedness being extended,
renewed, substituted, refinanced or replaced, plus the reasonable
amount of fees, underwriting discount, premiums and all other costs
and expenses reasonably incurred in connection therewith, (ii) such
Refinancing Indebtedness does not require an increase in amortization
payments payable by the Company or its Subsidiaries at any time prior
to May 15, 2004, (iii) such Refinancing Indebtedness contains terms
which, taken as a whole, are not less favorable to the Company and its
Subsidairies than the terms of the Indebtedness being extended,
renewed, substituted, refinanced or replaced and (iv) the only
obligors on the applicable Refinancing Indebtedness are the obligors
on the Indebtedness being refinanced unless otherwise permitted by
subsections 7.2 and 7.4.
7.3 Limitation on Liens. Create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, except for:
(a) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings diligently conducted,
provided that (i) adequate reserves with respect thereto are
maintained on the books of the Company or its Subsidiaries, as the
case may be, in conformity with GAAP and (ii) such Liens remain
unfiled or unregistered, as the case may be;
(b) any carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens incidental to construction,
maintenance, use or operation arising in the ordinary course of
business which (i) secure amounts not overdue for a period of more
than 60 days or (ii) are being contested in good faith by appropriate
proceedings diligently conducted and which do not exceed $1,000,000 in
the aggregate at any time;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security
legislation; and any attachment, judgment or similar
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Lien unless the writ, judgment or other process it secures shall not,
within 60 days after the entry thereof, have been discharged or the
execution thereof stayed pending appeal, or shall not have been
discharged within 60 days after the expiration of any such stay;
(d) (i) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business and (ii) purchase-money Liens on inventory incurred in the
ordinary course of business and Liens on inventory held by third
parties on consignment or a similar basis, in each case incurred in
the ordinary course of business, provided that the aggregate fair
market value of all inventory at any time subject to Liens described
in this clause (ii) shall not exceed $5,000,000;
(e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which exist
on the date hereof or which, in the aggregate, are not substantial in
amount and which do not in any case materially detract from the value
of the property subject thereto or materially interfere with the
ordinary conduct of the business of the Company or such Subsidiary;
(f) (i) until the Closing Date, Liens securing Indebtedness
under the Existing Credit Agreement, and (ii) Liens in existence on
the date hereof listed on Schedule III, provided that no such Lien is
spread to cover any additional property after the Closing Date and
that the amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness of the Company and its
Subsidiaries permitted by subsection 7.2(g) incurred in the ordinary
course of business to finance the acquisition of fixed or capital
assets, provided that (i) such Liens shall be created within 180 days
after the acquisition of such fixed or capital assets, (ii) such Liens
do not at any time encumber any property other than the property
financed by such Indebtedness, (iii) the amount of Indebtedness
secured thereby is not increased and (iv) the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 80% of
the fair value (as determined in good faith by the Company and
evidenced by a certificate of a Responsible Officer) of such property
at the time it was acquired;
(h) Liens on the property or assets of a corporation which
becomes a Subsidiary after the date hereof securing Indebtedness
permitted by subsection 7.2(d), provided that (i) such Liens existed
at the time such corporation became a Subsidiary and were not created
in anticipation thereof, (ii) any such Lien is not spread to cover any
property or assets of such corporation after the time such corporation
becomes a Subsidiary (except after-acquired property to the extent
such Lien includes after-acquired property) and (iii) the amount of
Indebtedness secured thereby is not increased;
(i) Liens created pursuant to the Security Documents;
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(j) Liens securing Refinancing Indebtedness permitted by
subsection 7.2(k) provided that (i) such Liens cover only the property
securing the Indebtedness being refinanced and (ii) the principal
amount of Indebtedness secured thereby is not increased, except as
permitted by subsection 7.2(k); and
(k) other Liens (other than on property constituting
Collateral) securing up to $15,000,000 of obligations.
7.4 Limitation on Guarantee Obligations. Create, incur,
assume or suffer to exist any Guarantee Obligation, unless such obligation would
be permitted to be incurred as Indebtedness of such Person pursuant to
subsection 7.2.
7.5 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, except:
(a) (i) any Subsidiary of the Company may be merged or
consolidated with or into the Company (provided that the Company shall
be the continuing or surviving corporation), (ii) any Subsidiary of
the Company may be merged, consolidated or amalgamated with or into a
Subsidiary Guarantor or a Canadian Subsidiary Guarantor (provided that
a Subsidiary Guarantor or a Canadian Subsidiary Guarantor shall be the
continuing or surviving corporation or, if such Subsidiary is the
Canadian Borrower, that the Canadian Borrower shall be the continuing
or surviving corporation) and (iii) any Subsidiary of the Company
(other than the Canadian Borrower) that is not a Subsidiary Guarantor
or a Canadian Subsidiary Guarantor may be merged, consolidated or
amalgamated with or into another Subsidiary that is not a Subsidiary
Guarantor or a Canadian Subsidiary Guarantor;
(b) (i) any Subsidiary may sell, lease, transfer or otherwise
dispose of all or substantially all of its assets (upon voluntary
liquidation or otherwise) to the Company, the Canadian Borrower, a
Subsidiary Guarantor or a Canadian Subsidiary Guarantor and (ii) any
Subsidiary of the Company (other than the Canadian Borrower) that is
not a Subsidiary Guarantor or a Canadian Subsidiary Guarantor may
sell, lease, transfer or otherwise dispose of all or substantially all
of its assets (upon voluntary liquidation or otherwise) to another
Subsidiary that is not a Subsidiary Guarantor or a Canadian Subsidiary
Guarantor; and
(c) in order to consummate an acquisition permitted by
subsection 7.10(g), the Company or a Subsidiary may be merged with the
acquired company as long as the surviving company is (i) the Company
(if the Company consummates any such transaction) or the Canadian
Borrower (if the Canadian Borrower consummates any such transaction)
or (ii) otherwise, a Subsidiary Guarantor or a Canadian Subsidiary
Guarantor.
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7.6 Limitation on Sale of Assets. Consummate any Asset Sale
except for the Disposition of assets and rights whose aggregate book value shall
not exceed 15% of the aggregate book value of the consolidated assets of the
Company and its Subsidiaries as of the Closing Date (after giving effect to the
Spin-Off Transactions) during the term of this Agreement; provided that (i) the
requirements of subsection 2.9(d) are complied with in connection therewith and
(ii) at least 80% of the consideration received by the Company or the applicable
Subsidiary, as the case may be, pursuant to such Asset Sale is in the form of
cash or Cash Equivalents.
7.7 Amendments to Spin-Off Documents. Amend, supplement or
otherwise modify the terms and conditions of the Spin-Off Documents (other than
the Management Agreement) except for any such amendment, supplement or
modification that could not reasonably be expected to have a Material Adverse
Effect or materially adversely affect the ability of the Loan Parties to perform
their respective obligations under the Loan Documents.
7.8 Limitations on Restricted Payments. Declare or pay any
dividend (other than dividends payable solely in common stock of the Person
making such dividend) on, or make any payment on account of, or set apart assets
for a sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any Capital Stock of the Company or any
Subsidiary, whether now or hereafter outstanding, or make any other distribution
in respect thereof, either directly or indirectly, whether in cash or property
or in obligations of the Company or any Subsidiary (collectively, "Restricted
Payments"), except that:
(a) (i) any Subsidiary may make Restricted Payments to the
Company, the Canadian Borrower, any Subsidiary Guarantor or any
Canadian Subsidiary Guarantor, (ii) the Company and the Canadian
Borrower may make Restricted Payments to any Subsidiary Guarantor or
any Canadian Subsidiary Guarantor, (iii) the Company may make
Restricted Payments to the Canadian Borrower, (iv) the Canadian
Borrower may make Restricted Payments to the Company, (v) any
Subsidiary (other than the Canadian Borrower) that is not a Subsidiary
Guarantor or a Canadian Subsidiary Guarantor may make Restricted
Payments to any other Subsidiary that is not a Subsidiary Guarantor or
a Canadian Subsidiary Guarantor and (vi) Soda Ash Partners may make
Restricted Payments pursuant to the Soda Ash Partnership Agreement;
(b) so long as no Default or Event of Default shall have
occurred and be continuing, the Company may pay dividends to
Intermediate Holdings as long as Intermediate Holdings concurrently
pays such dividends to Holdings in order to permit Holdings to purchase
Holdings' common stock or common stock options from present or former
officers or employees of Holdings, the Company or any Subsidiary upon
the death, disability or termination of employment of such officer or
employee, provided, that the aggregate amount of payments under this
paragraph (b) after the date hereof (net of any proceeds received by
Holdings and contributed to the Company after the date hereof in
connection with resales of any common stock or common stock options so
purchased) shall not exceed $8,000,000;
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(c) the Company may pay dividends to Intermediate Holdings to
be used directly by Intermediate Holdings, or paid by Intermediate
Holdings to Holdings and used by Holdings, to (i) pay Holdings' costs
(including all professional fees and expenses) incurred to comply with
its reporting obligations under federal or state laws, including any
reports filed with respect to the Securities Act, Exchange Act or the
respective rules and regulations promulgated thereunder, (ii) make
payments in respect of Holdings' directors and officers insurance
coverage, (iii) make payments in respect of indemnification obligations
under any Contractual Obligation or Requirement of Law owing to (x)
directors and officers of Holdings or (y) to employees or other Persons
to the extent, in the case of this clause (y), such payments relate to
services performed by any such Person on behalf of the Company and its
Subsidiaries, (iv) pay all reasonable fees and expenses payable by it
and relating to the Industrial Chemicals Business in connection with
the Spin-Off, (v) pay amounts due pursuant to the Management Agreement,
(vi) pay any amounts payable under the Spin-Off Documents, (vi) pay the
Allocable Tax Obligations and (vii) pay Holdings' and Intermediate
Holdings' other operational and corporate overhead expenses incurred in
the ordinary course of business to the extent such expenses relate to
acting as a holding company for the Company and its Subsidiaries or to
the operation of the Company and its Subsidiaries; and
(d) in addition to the Restricted Payments otherwise permitted
under this subsection 7.8, the Company shall be permitted to make (i)
so long as the Leverage Ratio reflected on the most recent Compliance
Certificate delivered pursuant to subsection 6.2(b) is less than 3.50
to 1.00, (x) Restricted Payments in an amount not to exceed the
aggregate Net Cash Proceeds, to the extent not required to be applied
to reduce the Total Commitments pursuant to subsection 2.9(c), received
by the Company from any issue and sale (other than to a Subsidiary of
the Company) of Equity Interests of the Company or capital contribution
to the Company, less the aggregate amount of (A) any Investments made
pursuant to subsection 7.10(g-1) and (B) any Capital Expenditures made
pursuant to subsection 7.9(c)(i), and (y) in any fiscal quarter of the
Company, Restricted Payments not exceeding in the aggregate 50% of
Consolidated Net Income for the four preceding fiscal quarters less the
aggregate amount of any Capital Expenditures made pursuant to
subsection 7.9(c)(ii), and (ii) additional Restricted Payments in an
aggregate amount not to exceed $5,000,000 during the term of this
Agreement.
7.9 Limitation on Capital Expenditures. Make or commit to
make (by way of the acquisition of securities of a Person or otherwise) any
expenditure in respect of the purchase or other acquisition of fixed or capital
assets (excluding any such asset acquired in connection with normal replacement
and maintenance programs properly charged to current operations) ("Capital
Expenditures") except (a) from the proceeds of any Reinvestment Deferred Amount,
(b) for expenditures in connection with the acquisition of mineral leases not
exceeding $5,000,000 in the aggregate during the term of this Agreement, (c) so
long as the Leverage Ratio reflected on the most recent Compliance Certificate
delivered pursuant to subsection 6.2(b) is less than 3.50 to 1.00, (i) Capital
Expenditures in an amount not to exceed the aggregate Net Cash Proceeds, to the
extent not required to be applied to reduce the Total Commitments pursuant to
subsection 2.9(c), received by the Company from any issue and sale (other than
to a Subsidiary of the
86
Company) of Equity Interests of the Company or capital contribution to the
Company, less the aggregate amount of (A) any Investments made pursuant to
subsection 7.10(g-1) and (B) any Restricted Payments made pursuant to subsection
7.8(d)(i)(x), and (ii) in any fiscal quarter of the Company, Capital
Expenditures in an amount not exceeding in the aggregate 50% of Consolidated Net
Income for the four preceding fiscal quarters less the aggregate amount of any
Restricted Payments made pursuant to subsection 7.8(d)(i)(y), and (d) for
expenditures in the ordinary course of business not exceeding, in the aggregate
for the Company and its Subsidiaries during any period set forth below, the sum
of (i) the amount set forth opposite such period below:
Period Amount
July 1, 1999 - December 31, 1999 $20,000,000
January 1, 2000 - December 31, 2000 $19,000,000
January 1, 2001 - December 31, 2001 $19,000,000
January 1, 2002 - December 31, 2002 $17,000,000
January 1, 2003 - Termination Date $15,000,000
and (ii) beginning with the period from January 1, 2000 to December 31, 2000,
any portion of such amount that was not so expended in any prior period
(provided that Capital Expenditures made pursuant to this clause (d) during any
period shall be deemed made, first, in respect of amounts permitted for such
period as provided in the chart above and, second, in respect of amounts carried
over from the prior period); provided that, for purposes of applying this
subsection 7.9, the amount of any Capital Expenditures made by Soda Ash Partners
shall be deemed to be in an amount equal to 51% of such amount.
7.10 Limitation on Investments, Loans and Advances. Make any
advance, loan, extension of credit or capital contribution to, or purchase any
stock, bonds, notes, debentures or other securities of or any assets
constituting a business unit of, or make any other investment in, any Person
(each of the foregoing an "Investment"), except:
(a) extensions of trade credit in the ordinary course of
business;
(b) Investments in Cash and Cash Equivalents;
(c) loans and advances to employees of the Company or its
Subsidiaries for travel, entertainment and relocation expenses in the
ordinary course of business;
(d) (i) Investments of the Company and its Subsidiaries in
Subsidiaries of the Company as such investments are in effect on the
date hereof and (ii) loans and advances by Subsidiaries of the Company
to the Company;
(e) (i) Investments by the Company in the Canadian Borrower,
a Subsidiary Guarantor or a Canadian Subsidiary Guarantor, (ii)
Investments by Subsidiaries of the Company in the Company, the
Canadian Borrower, a Subsidiary Guarantor or a Canadian Subsidiary
Guarantor and (iii) Investments by Subsidiaries of the Company (other
than
87
the Canadian Borrower) that are not Subsidiary Guarantors or
Canadian Subsidiary Guarantors in other Subsidiaries that are not
Subsidiary Guarantors or Canadian Subsidiary Guarantors;
(f) Investments in the Capital Stock or the assets of Soda
Ash Partners; provided that, except in the case of an Investment
required pursuant to a capital call under the Soda Ash Partnership
Agreement, at the time of the making of such Investment no Default or
Event of Default shall have occurred and be continuing or shall result
therefrom;
(g) Investments consisting of the acquisition of all or
substantially all of the assets of, or a majority of the common Equity
Interests of, a Person or division or line of business of a Person if
immediately after giving effect thereto (i) no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, (ii) the Company shall be in compliance, on a pro forma
basis after giving effect to such acquisition, with the covenants
contained in subsection 7.1 recomputed as at the last day of the most
recently ended fiscal quarter of the Company as if such acquisition
had occurred on the first day of each relevant period for testing such
compliance, and the Company shall have delivered to the Administrative
Agent, a certificate of its chief financial officer to such effect
accompanied by all relevant financial information for such
acquisition, (iii) if such acquisition is of assets other than Capital
Stock, the acquiring Person shall be a Grantor under the Guarantee and
Collateral Agreement (and/or other applicable Security Documents) and
(iv) if such acquisition is of Equity Interests of another Person,
such other Person shall become a Subsidiary Guarantor or a Canadian
Subsidiary Guarantor, as the case may be; provided that (x) no
acquisition may be made of the Capital Stock of any public company
unless the Board of Directors (or other governing body) of such
company approves such acquisition at the time it is commenced and (y)
the aggregate consideration paid (including, without limitation, (A)
the amount of cash paid in connection with each such acquisition, (B)
the value (as determined for purposes of each such acquisition in
accordance with the applicable acquisition agreement) of all Capital
Stock of the Company and its Subsidiaries issued in connection with
each such acquisition and (C) the principal amount (or, if less, the
accreted value) at the time of each such acquisition of all
Indebtedness assumed by the Company or its Subsidiaries with respect
thereto) by the Company and its Subsidiaries in respect of all
acquisitions made pursuant to this subsection 7.10(g) during the term
of this Agreement shall not exceed $10,000,000;
(g-1) in addition to the Investments otherwise permitted under
this subsection 7.10, so long as the Leverage Ratio reflected on the
most recent Compliance Certificate delivered pursuant to subsection
6.2(b) is less than 3.50 to 1.00, Investments in an amount not to
exceed the aggregate Net Cash Proceeds, to the extent not required to
be applied to reduce the Total Commitments pursuant to subsection
2.9(c), received by the Company from any issue and sale (other than to
a Subsidiary of the Company) of Equity Interests of the Company or
capital contribution to the Company, less the aggregate amount of (A)
any Restricted Payments made pursuant to subsection 7.8(d)(i)(x) and
(B) any Capital Expenditures made pursuant to subsection 7.9(c)(i);
88
(g-2) any Investment in any Supply Partnership in an
aggregate amount at any time outstanding not to exceed 10% of
Consolidated Tangible Assets;
(g-3) any Investment pursuant to a Mineral Agreement;
(g-4) securities or other Investments received in settlement
of debts created in the ordinary course of business and owing to the
Company or any Subsidiary, or as a result of foreclosure, perfection or
enforcement of any Lien, or in satisfaction of judgments, including in
connection with any bankruptcy proceeding or other reorganization of
another Person;
(g-5) Investments in prepaid expenses, negotiable instruments
held for collection and lease, utility and workers' compensation,
performance and other similar deposits;
(g-6) Investments in connection with any Currency Agreements,
Interest Rate Protection Arrangements or energy or commodity hedge,
exchange or similar agreements, provided, in each case, that such
agreement, arrangement, hedge or exchange is otherwise permitted under
subsection 7.2;
(g-7) promissory notes received as a portion of the
consideration for any Asset Sale consummated in accordance with
subsection 7.6;
(h) Capital Expenditures made pursuant to and in accordance
with subsection 7.9; and
(i) in addition to the Investments otherwise permitted by
this subsection 7.10, Investments not to exceed in the aggregate at
any time outstanding the greater of $10,000,000 and 5% of Consolidated
Tangible Assets, if immediately after giving effect thereto (i) no
Default or Event of Default shall have occurred and be continuing or
would result therefrom, and (ii) the Company shall be in compliance on
a pro forma basis after giving effect to such Investment, with the
covenants contained in subsection 7.1 recomputed as at the last day of
the most recently ended fiscal quarter of the Company as if such
Investment had occurred on the first day of each relevant period for
testing such compliance, and the Company shall have delivered to the
Administrative Agent, a certificate of its chief financial officer to
such effect accompanied by all relevant financial information for such
acquisition; provided that no acquisition may be made of the Capital
Stock of any public company unless the Board of Directors (or other
governing body) of such company approves such acquisition at the time
it is commenced.
7.11 Limitations on Optional Payments and Modifications of
Agreements.(a) Make any optional payment or prepayment on or redemption,
defeasance or purchase of any Indebtedness or Guarantee Obligations, in each
case, which are subordinated to any Obligations (or, if applicable, any
guarantee thereof), except, so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, in connection with the
extension, renewal,
89
substitution, refinancing or replacement of any such Indebtedness with
Refinancing Indebtedness (as defined in and to the extent permitted by
subsection 7.2(k)), (b) amend, modify or change, or consent or agree to any
amendment, modification or change to, any of the terms of any Indebtedness which
is subordinated to any of the Obligations (or any guarantee thereof) in any
material respect or in any way that is materially adverse to the interests of
the Lenders or the Company, (c) amend, modify or change, or consent to any
amendment, modification or change to (i) any of the terms of the Soda Ash
Partnership Agreement that is materially adverse to the interests of the Lenders
or the Borrowers or their Subsidiaries or the Management Agreement in any
material respect or in any way that is in the aggregate materially adverse to
the interests of the Lenders or the Borrowers or (ii) any of the terms of the
Security Documents, except pursuant to the terms thereof. The Company shall
provide the Administrative Agent and each Lender with prior written notice of
(i) any payment, prepayment, redemption, defeasance or purchase of any
Indebtedness or Guarantee Obligation pursuant to clause (a) above and (ii) any
amendment, modification or change to any of the terms of any Indebtedness of the
Company and its Subsidiaries or of any agreement referred to in clause (c)
above.
(b) Notwithstanding paragraph (a) above, (i) make or offer to
make any payment, prepayment, repurchase or redemption of or otherwise defease
or segregate funds with respect to the Senior Subordinated Notes, provided that
the Company may make regularly scheduled payments of interest on the Senior
Subordinated Notes, (ii) consent to any amendment, modification or change to the
Senior Subordinated Notes of the Senior Subordinated Note Indenture which
adversely affects the Lenders or (iii) designate any Indebtedness (other than
obligations of the Loan Parties pursuant to the Loan Documents) as "Designated
Senior Indebtedness" for the purposes of the Senior Subordinated Note Indenture.
7.12 Limitation on Transactions with Affiliates. Enter into
any transaction, including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service, with any Affiliate unless
such transaction is (a) otherwise permitted under this Agreement or, in the case
of any of the Spin-Off Transactions, described in the Form 10 Filing, (b) in the
ordinary course of the Company's or such Subsidiary's business and (c) upon fair
and reasonable terms in the aggregate no less favorable to the Company or such
Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person which is not an Affiliate; provided that (i)
the Company may enter into the Management Agreement and renewals, modifications,
replacements or amendments of such agreement permitted by subsection 7.11, (ii)
the Company and its Subsidiaries may enter into the Spin-Off Documents and
renewals, modifications, replacements or amendments thereof permitted by
subsection 7.7 and (iii) the restrictions set forth in this subsection 7.12
shall not apply to (1) transactions pursuant to the Management Agreement or any
Spin-Off Document, (2) any employment or separation agreement, collective
bargaining agreement, benefit plan, program or arrangement, related trust
agreement or any other similar arrangement for or with an employee, officer or
director entered into by the Company or any Subsidiary in the ordinary course of
business, (3) sales of soda ash, calcium chloride and other products to GenTek
and its Subsidiaries pursuant to agreements in existence on the Closing Date,
(4) payments of indemnification or contribution required by any Contractual
Obligation or Requirement of Law and made to any directors, officers, employees
or agents of the Company or any Subsidiary as determined in good faith by
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the Board of Directors of the Company or such Subsidiary, (5) any Restricted
Payment otherwise permitted under subsection 7.8, (6) any payment of
compensation, or any issuance, grant or award of stock, options, other equity
related interests or other securities to employees, officers or directors in the
ordinary course of business and (7) any transaction in the ordinary course of
business between the Company or any Subsidiary and any Affiliate that is a joint
venture or similar entity (including a supply partnership and Mineral Agreement)
in which the Company and/or a Subsidiary has an Investment and which is
primarily engaged in a Related Business.
7.13 Limitation on Sales and Leasebacks. Enter into any
arrangement with any Person providing for the leasing by the Company or any
Subsidiary of real or personal property which has been or is to be sold or
transferred by the Company or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Company or such
Subsidiary, except as otherwise permitted under subsection 7.2(g).
7.14 Limitation on Changes in Fiscal Year. Permit the fiscal
year of the Company to end on a day other than December 31, unless this
Agreement shall have been amended as necessary to restore the parties hereto as
nearly as possible to their respective positions prior to such change in fiscal
year.
7.15 Limitation on Negative Pledge Clauses. Enter into with
any Person any agreement which prohibits or limits the ability of the Company or
any of its Subsidiaries to create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired, other than (a) this Agreement and the other Loan Documents, (b) any
agreement of any Person which becomes a Subsidiary of the Company or to which
the Company or any Subsidiary becomes subject after the date hereof in
connection with a Permitted Acquisition, which agreement was not created in
anticipation thereof, including, but not limited to, any such agreement
governing acquired Indebtedness permitted under subsection 7.2(d), provided that
any agreement so permitted in accordance with this clause (b) shall apply only
to the property or assets acquired, directly or indirectly, by the Company
pursuant to such Permitted Acquisition, (c) agreements that restrict in a
customary manner the subletting, assignment or transfer of any property or asset
that is subject to a lease, license or similar contract, or the assignment or
transfer of any lease, license or other contract, (d) customary provisions
restricting dispositions of real property interests set forth in any easement or
similar agreements, (e) agreements in connection with the sale or disposition of
any assets of the Company or the sale or disposition of a Subsidiary (or any of
its property or assets), in any such case as permitted under this Agreement,
pending the closing of such sale or disposition, (f) any industrial revenue
bonds, purchase money mortgages or Financing Leases permitted by this Agreement
(in which cases, any prohibition or limitation shall only be effective against
the assets financed thereby) and (g) agreements governing Indebtedness permitted
to be incurred pursuant to subsection 7.2 which contain only restrictions
customary for such type of Indebtedness, including agreements creating Liens
permitted to be incurred pursuant to subsection 7.3, provided that, in the case
of any agreement described in this clause (g), such agreement does not prohibit
or limit in any manner the ability of Intermediate Holdings, the Company or any
of its
91
Subsidiaries to create, incur, assume or suffer to exist any Lien securing any
Obligations on any Collateral.
7.16 Limitation on Lines of Business. Enter into any
significant business, either directly or through any Subsidiary, except for
those businesses which are primarily of the same general types as those in which
the Company and its Subsidiaries are engaged on the date of this Agreement or
which are Related Businesses.
SECTION 8. EVENTS OF DEFAULT
8.1 Events of Default. If any of the following events shall
occur and be continuing:
(a) The applicable Borrower shall fail to pay any principal
of any Loan or any Reimbursement Obligation or Acceptance
Reimbursement Obligation when due in accordance with the terms
thereof; or the Borrowers shall fail to pay any interest on any Loan,
or any other amount payable on account thereof hereunder, within three
Business Days after any such interest or other amount becomes due in
accordance with the terms thereof; or
(b) Any representation or warranty made or deemed made by
either Borrower or any other Loan Party herein or in any other Loan
Document or which is contained in any certificate, document or
financial or other statement furnished by it at any time under or in
connection with this Agreement or any such other Loan Document shall
prove to have been incorrect or misleading in any material respect on
or as of the date made or deemed made; or
(c) Either Borrower or any other Loan Party shall default in
the observance or performance of any agreement contained in subsection
6.11 or Section 7 hereof (other than subsections 7.3 and 7.7); or
(d) Either Borrower or any other Loan Party shall default in
the observance or performance of any other agreement contained in this
Agreement or any other Loan Document (other than as provided in
paragraphs (a) through (c) of this Section), and such default shall
continue unremedied for a period of 30 days after written notice to
the Company by the Administrative Agent; or
(e) The Company or any of its Subsidiaries shall (i) default
in any payment of principal of or interest on any Indebtedness (other
than the Loans, the Reimbursement Obligations and the Acceptance
Reimbursement Obligations) or in the payment of any Guarantee
Obligation, aggregating $5,000,000 or more, beyond the period of grace
(not to exceed 30 days), if any, provided in the instrument or
agreement under which such Indebtedness or Guarantee Obligation was
created; or (ii) default in the observance or performance of any other
agreement or condition following any applicable grace periods
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relating to any Indebtedness or Guarantee Obligation referred to in
clause (i) immediately above or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
shall occur or condition exist, the effect of which default or other
event or condition is to cause, or to permit the holder or holders of
any Indebtedness referred to in clause (i) immediately above or
beneficiary or beneficiaries of such Guarantee Obligation referred to
in clause (i) immediately above (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with
the giving of notice, lapse of time or both if required, such
Indebtedness to become due prior to its stated maturity or such
Guarantee Obligation to become payable, provided, however, that if the
default described in this clause (ii) is cured, the Event of Default
under this clause (ii) shall be simultaneously cured; or
(f) (i) (A) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of
the Code) involving any Plan, (B) any "accumulated funding deficiency"
(as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan or any Lien in favor of the PBGC or a
Plan shall arise on the assets of the Company or any Commonly
Controlled Entity, (C) a Reportable Event shall occur with respect to,
or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Single
Employer Plan, which Reportable Event or commencement of proceedings
or appointment of a trustee is, in the reasonable opinion of the
Required Lenders, likely to result in the termination of such Plan for
purposes of Title IV of ERISA, (D) any Single Employer Plan shall
terminate for purposes of Title IV of ERISA, (E) the Company or any
Commonly Controlled Entity shall, or in the reasonable opinion of the
Required Lenders is likely to, incur any liability in connection with
a withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (F) any other similar event or condition shall
occur or exist with respect to a Plan; and in each case in clauses (A)
through (F) above, such event or condition, together with all other
such events or conditions, if any, could reasonably be expected to
have a Material Adverse Effect; or
(ii) (A) a Borrower or any of its Subsidiaries fails to remit
in a timely manner any amount payable to a Canadian Pension Plan, (B) a
Borrower or any of its Subsidiaries receives, directly or indirectly,
payment of any amount from a Canadian Pension Plan, (C) any Canadian
Pension Plan is terminated, wound up or otherwise ceases to be
registered under the Income Tax Act (Canada) or the applicable
provincial pension benefits standards legislation, or (D) any other
similar event or condition shall occur or exist with respect to a
Canadian Pension Plan; and in each case in clauses (A) through (D)
above, such event or condition, together with all other such events or
conditions, if any, could reasonably be expected to have a Material
Adverse Effect; or
(g) One or more judgments or decrees shall be entered against
Holdings or any of its Subsidiaries involving in the aggregate a
liability (to the extent not paid or covered by insurance less any
applicable and customary retention or deductible) of $5,000,000 or
more, and all such judgments or decrees shall not have been vacated,
discharged, stayed or bonded pending appeal within 60 days from the
entry thereof; or
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(h) (i) Any of the Security Documents shall cease, for any
reason, to be in full force and effect (other than pursuant to the
terms hereof or thereof), or either Borrower or any other Loan Party
which is a party to any of the Security Documents shall so assert in
writing or (ii) the Lien created by any of the Security Documents on
any material portion of the Collateral shall cease to be enforceable
and of the same effect and priority purported to be created thereby
and, if such condition is correctable, such condition is not corrected
within 30 days; or
(i) Any guarantee under the Guarantee and Collateral
Agreement or the Canadian Guarantee and Collateral Agreement shall
cease for any reason to be in full force and effect (other than
pursuant to the terms hereof or thereof) or any Loan Party shall so
assert in writing; or
(j) A Change in Control shall have occurred; or
(k) Holdings shall cease to own legally and beneficially 100%
of each class of Capital Stock of Intermediate Holdings free of Liens;
Intermediate Holdings shall cease to own legally and beneficially 100%
of each class of Capital Stock of the Company free of Liens (except
for Liens created pursuant to the Security Documents); the Company
shall cease to beneficially own 100% of each class of Capital Stock of
the Canadian Borrower free of Liens (except for Liens created pursuant
to the Security Documents); or the Company shall cease to beneficially
own at least 51% of the economic interest in, or shall cease to be the
sole managing partner of, Soda Ash Partners; or
(l) the Senior Subordinated Notes shall cease, for any
reason, to be validly subordinated to the Company Obligations, as
provided in the Senior Subordinated Note Indenture, or any Loan Party,
any Affiliate of any Loan Party, the trustee in respect of the Senior
Subordinated Notes or the holders of at least 25% in aggregate
principal amount of the Senior Subordinated Notes shall so assert and,
in the event of such assertion by the trustee or such holders, the
Company does not within 30 days thereof deliver to the Administrative
Agent an opinion of counsel (such counsel to be reasonably
satisfactory to the Administrative Agent) stating that the
subordination provisions of the Senior Subordinated Note Indenture are
legal, valid and binding; or
(m) (i) The Company, NHO Canada, Canadian Holdings, the
Canadian Borrower or any of the Company's Material Subsidiaries shall
commence any case, proceeding or other action (A) under any existing
or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking
to have an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or
other similar official for it or for all or any substantial part of
its assets, or the Company, NHO Canada, Canadian Holdings, the
Canadian Borrower or any of the Company's Material Subsidiaries shall
make a general assignment for the benefit of its creditors; or (ii)
there shall be
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commenced against the Company, NHO Canada, Canadian Holdings, the
Canadian Borrower or any of the Company's Material Subsidiaries any
case, proceeding or other action of a nature referred to in clause (i)
above which (A) results in the entry of an order for relief or any
such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall
be commenced against the Company, NHO Canada, Canadian Holdings, the
Canadian Borrower or any of the Company's Material Subsidiaries any
case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order
for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof;
or (iv) the Company, NHO Canada, Canadian Holdings, the Canadian
Borrower or any of the Company's Material Subsidiaries shall take any
action in furtherance of, or indicating its consent to, approval of,
or acquiescence in, any of the acts set forth in clause (i), (ii), or
(iii) above; or (v) the Company, NHO Canada, Canadian Holdings, the
Canadian Borrower or any of the Company's Material Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due;
then, and in any such event:
(A) if such event is an Event of Default specified in clause
(i) or (ii) of paragraph (m) of this subsection 8.1 with respect to either
Borrower, automatically the Revolving Credit Commitments and the Canadian
Revolving Credit Commitments shall immediately terminate and the Loans hereunder
(with accrued interest thereon) and all other amounts owing under this Agreement
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder, and all face amounts of Acceptances not drawn
upon, expired, demanded or matured, in accordance with subsection 2.3(j)) shall
immediately become due and payable; and
(B) if such event is any other Event of Default specified in
this subsection 8.1, any or all of the following actions may be taken: (i) with
the consent of the Required Lenders, the Administrative Agent and/or the
Canadian Administrative Agent may, or upon the request of the Required Lenders,
the Administrative Agent and/or the Canadian Administrative Agent shall, by
notice to the Borrowers declare the Revolving Credit Commitments and the
Canadian Revolving Credit Commitments to be terminated forthwith, whereupon the
Revolving Credit Commitments and the Canadian Revolving Credit Commitments shall
immediately terminate and (ii) with the consent of the Required Lenders, the
Administrative Agent and/or the Canadian Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent and/or the Canadian
Administrative Agent shall, by notice to the Borrowers, declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing on account
thereof under this Agreement and the other Loan Documents (including, without
limitation, all amounts of L/C Obligations, whether or not the beneficiaries of
the then outstanding Letters of Credit shall have presented the documents
required thereunder, and all face amounts of Acceptances not drawn upon,
expired, demanded or matured, in accordance with subsection 2.3(j)) to be due
and payable forthwith, whereupon the same shall immediately become due and
payable.
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8.2 Certain Provisions Applicable to Letters of Credit. With
respect to all Letters of Credit issued from the account of a Borrower with
respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to subsection 8.1, such Borrower shall at such time
deposit in a cash collateral account opened by the Applicable Agent an amount
equal to the aggregate then undrawn and unexpired amount of such Letters of
Credit. Each Borrower hereby grants to each Applicable Agent, for the benefit of
the applicable Issuing Banks and the applicable Participating Banks, a security
interest in such cash collateral to secure all obligations of such Borrower in
respect of such Letters of Credit under this Agreement and the other Loan
Documents. Amounts held in such cash collateral account shall be applied by the
Applicable Agent to the payment of drafts drawn under such Letters of Credit,
and the unused portion thereof after all such Letters of Credit shall have
expired or been fully drawn upon, if any, shall be applied to repay other
obligations of such Borrower hereunder and under the Notes. After all such
Letters of Credit shall have expired or been fully drawn upon, all Reimbursement
Obligations shall have been satisfied and all other obligations of the Borrowers
hereunder and under the Notes shall have been paid in full, the balance, if any,
in such cash collateral account shall be returned to the applicable Borrower.
Each Borrower shall execute and deliver to the Applicable Agent, for the account
of the applicable Issuing Banks and the applicable Participating Banks, such
further documents and instruments as the Applicable Agent may request to
evidence the creation and perfection of such security interest in such cash
collateral account.
8.3 Certain Waivers. Except as expressly provided above in
this Section, presentment, demand, protest and all other notices of any kind
with respect to matters set forth in this Section are hereby expressly waived.
SECTION 9. THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates
and appoints Chase as the Administrative Agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes Chase, as the Administrative Agent for such Lender, to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein and in the other Loan
Documents, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against the Administrative Agent. The Designated Issuer in its capacity as such
shall be entitled to the same rights under this Section 9 as accrue to the
Administrative Agent as if it were named in place of the Administrative Agent.
In acting as Collateral Agent Chase shall be entitled to the rights and benefits
of, and subject to the obligations set forth for, the Administrative Agent in
this Section 9, mutatis mutandis, which Section is hereby incorporated by
reference, mutatis mutandis, in each of the Security Documents.
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9.2 Delegation of Duties. The Administrative Agent may
execute any of its duties under this Agreement and the other Loan Documents by
or through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrowers or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the Notes or any
other Loan Document or for any failure of either Borrower to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of either Borrower.
9.4 Reliance by Administrative Agent. The Administrative
Agent shall be entitled to rely, and shall be fully protected in relying, upon
any Note, writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the Borrowers),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Required
Lenders as it deems appropriate against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the Notes and the other Loan
Documents if acting in accordance with a request of the Required Lenders as it
deems appropriate, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Notes.
9.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender or the Company referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice
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of default". In the event that the Administrative Agent receives such a notice,
the Administrative Agent shall promptly give notice thereof to the Lenders.
The Administrative Agent shall take such action with respect to such Default
or Event of Default, or any acceleration of any amounts due hereunder, 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, Event of
Default or acceleration as it shall deem advisable in the best interests of
the relevant Lenders. To the extent that, as a result of the exercise by it
of any remedies with respect to any Collateral, the Administrative Agent shall
receive or realize any amounts, it shall distribute such amounts ratably among
the Lenders by reference to the aggregate amounts accrued and unpaid that are
outstanding under the Agreement and the other Loan Documents and owing to the
respective Lenders (after deducting and applying any amounts then owing to the
Administrative Agent or on account of expenses of the Administrative Agent
previously paid by any Lender), and if the portion to be so distributed to any
Lenders shall exceed the sum then due and payable to such Lenders, such excess
shall be held by the Administrative Agent in a collateral account for such
Lenders.
9.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act by the
Administrative Agent hereafter taken, including any review of the affairs of any
Loan Party, shall be deemed to constitute any representation or warranty by the
Administrative Agent to any Lender. Each Lender represents to the Administrative
Agent that it has, independently and without reliance upon the Administrative
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Company and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon the Administrative Agent 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 analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Borrowers. Each Lender acknowledges and agrees to
comply with the provisions of subsection 10.6 applicable to such Lender. Except
for notices, reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent hereunder, the Administrative Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of either Borrower which
may come into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
9.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrowers and without limiting the obligation of the Borrowers and the other
Loan Parties to do so), ratably according to their respective Total Credit
Percentages in effect on the date on which indemnification is sought
98
under this subsection (or, if indemnification is sought after the date upon
which the Revolving Credit Commitments and Canadian Revolving Credit
Commitments shall have terminated and the Loans shall have been paid in full,
ratably in accordance with their Total Credit Percentages immediately prior
to such date), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Loans) be imposed on, incurred by or
asserted against the Administrative Agent in any way relating to or arising
out of this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing;
provided that no Lender shall be liable for the payment of any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Administrative
Agent's gross negligence or willful misconduct. The obligations to indemnify
an Issuing Lender shall be ratable among the Revolving Credit Lenders, in the
case of the Revolving Credit Commitments, or the Canadian Revolving Credit
Lenders, in the case of the Canadian Revolving Credit Commitments, in accordance
with their respective Applicable Percentages (or, if the Commitments have been
terminated, the outstanding principal amount of their respective Total
Extensions of Credit). The agreements in this subsection shall survive the
payment of the Loans and all other amounts payable hereunder.
9.8 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrowers and the other
Loan Parties as though the Administrative Agent were not the Administrative
Agent hereunder and under the other Loan Documents. With respect to its Loans
made or renewed by it and any Note issued to it and with respect to any Letter
of Credit issued or participated in by it, the Administrative Agent shall have
the same rights and powers under this Agreement and the other Loan Documents as
any Lender and may exercise the same as though it were not the Administrative
Agent, and the terms "Lender" and "Lenders" shall include the Administrative
Agent in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent
may resign as Administrative Agent upon 30 days' notice to the Lenders and the
Company. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Majority Facility Lenders
with respect to the Revolving Credit Facility shall appoint from among the
Revolving Credit Lenders a successor agent for such Lenders, which successor
agent shall be approved by the Company (such approval not to be unreasonable
withheld), whereupon such successor agent shall succeed to the rights, powers
and duties of the Administrative Agent, and the term "Administrative Agent"
shall mean such successor agent effective upon such appointment and approval,
and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loan. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this subsection
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and the other Loan
Documents.
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9.10 Canadian Administrative Agent. Each Canadian Revolving
Credit Lender hereby irrevocably designates and appoints Chase Canada as the
Canadian Administrative Agent under this Agreement and the other Loan Documents,
and each such Canadian Revolving Credit Lender irrevocably authorizes Chase
Canada, as Canadian Administrative Agent for such Lender, to take such action on
its behalf under the provisions of the Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Canadian Administrative Agent by the terms of this Agreement and the
other Loan Documents, together with such other provisions as are reasonably
incidental thereto. Each Canadian Revolving Credit Lender and the Borrowers
hereby agree and confirm that the provisions of this Section 9 shall apply to
Chase Canada as the Canadian Administrative Agent upon the same terms and
subject to the same conditions as apply to Chase in acting as Administrative
Agent and as Collateral Agent in this Section 9, mutatis mutandis; provided that
any successor Canadian Administrative Agent shall be a bank with an office in
Toronto, Canada having a combined capital and surplus of at least $500,000,000
or an Affiliate of any such bank which is also a Canadian Revolving Credit
Lender.
9.11 Documentation Agent and Syndication Agent. Neither the
Documentation Agent nor the Syndication Agent shall have any rights or
obligations under the Loan Documents in their capacities as such.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement or any
other Loan Document, nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions of this
subsection. The Required Lenders may, or, with the written consent of the
Required Lenders, the Administrative Agent and the Canadian Administrative Agent
may, from time to time, (a) enter into with the Borrowers and the other Loan
Parties written amendments, supplements or modifications hereto and to the other
Loan Documents for the purpose of adding any provisions to this Agreement or the
other Loan Documents or changing in any manner the rights of the Lenders or of
the Borrowers and the other Loan Parties hereunder or thereunder or (b) waive,
on such terms and conditions as the Required Lenders or the Administrative
Agent, as the case may be, may specify in such instrument, any of the
requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall:
(i) (x) reduce the amount or extend the scheduled date of
maturity of any Loan or any Reimbursement Obligation or any Acceptance
Reimbursement Obligation or of any scheduled installment thereof, or
(y) reduce the stated rate of any interest or fee payable hereunder or
extend the scheduled date of any payment thereof or increase the
amount or (z) extend the expiration date of any Lender's Revolving
Credit Commitment or Canadian Revolving Credit Commitment, in each
case, without the written consent of each Lender directly affected
thereby;
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(ii) amend, modify or waive any provision of subsection 9.5
or this subsection 10.1 or reduce the percentage specified in the
definition of Required Lenders, or consent to the assignment or
transfer by any Loan Party of any of its rights and obligations under
this Agreement and the other Loan Documents (other than pursuant to a
transaction permitted by subsection 7.5), in each case, without the
written consent of all the Lenders;
(iii) release the Company, the Canadian Borrower, any
Subsidiary Guarantor, any Canadian Subsidiary Guarantor or any other
Loan Party that is a Material Subsidiary from its obligations under
any Security Document or release all or substantially all of the
Collateral, in either case without the consent of each Lender, in each
case except as expressly permitted hereby or by the other Loan
Documents;
(iv) amend, modify or waive any provision of Section 9
without the written consent of the then Administrative Agent and, if
affected thereby, the Canadian Administrative Agent and the Designated
Issuer;
(v) amend, modify or waive the order of application of
prepayments specified in subsection 2.9(e) without the written consent
of the Majority Facility Lenders under each Facility adversely
affected thereby;
(vi) amend, modify or waive the provisions of Section 3, any
Letter of Credit or any L/C Obligation without the written consent of
each relevant Issuing Lender; or
(vii) amend the first two sentences of subsection 2.15(a)
without the written consent of each Lender adversely affected thereby.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Borrowers, the
Lenders, the Administrative Agent, the Canadian Administrative Agent and all
future holders of the Notes. In the case of any waiver, the Borrowers, the
Lenders, the Administrative Agent and the Canadian Administrative Agent shall be
restored to their former position and rights hereunder and under the outstanding
Notes and any other Loan Documents, and any Default or Event of Default waived
shall be deemed to be cured and not continuing; but no such waiver shall extend
to any subsequent or other Default or Event of Default, or impair any right
consequent thereon.
10.2 Notices. All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or four days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received (provided it is also mailed), addressed as follows in the case of the
Borrowers, the Administrative Agent and the Canadian Administrative Agent, and
as set forth in Schedule I in the case of the other parties hereto, or to such
other address as may be hereafter notified by the respective parties hereto and
any future holders of the Notes:
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The Company: General Chemical Industrial Products Inc.
90 East Halsey Road
Parsippany, New Jersey 07054
Attention: Chief Financial Officer
Telecopy: (973) 515-1997
The Canadian Borrower: General Chemical Canada Ltd.
201 City Center Drive, 11th Floor
Mississauga, Ontario, Canada L5B 3A3
Attention: President
Telecopy: (905) 896-9365
with a copy to:
The General Chemical Group Inc.
90 East Halsey Road
Parsippany, New Jersey 07054
Attention: General Counsel
Telecopy: (973) 515-3244
The Administrative Agent: The Chase Manhattan Bank
270 Park Avenue, 38th Floor
New York, New York 10017
Attention: Elizabeth Swerz
Telecopy: (212) 270-7939
with a copy to: The Chase Manhattan Bank
c/o The Loan and Agency Services Group
One Chase Manhattan Plaza
New York, New York 10081
Attention: Dan Fischer
Telecopy: (212) 552-5777
The Canadian Administrative
Agent: The Chase Manhattan Bank of Canada
1 First Canadian Place
100 King Street West
Toronto, Ontario M5X 1A4
Attention: Funding Officer
Vice President
Telecopy: 416-216-4162
416-216-4161
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The Issuing Banks: Chase Manhattan Bank Delaware
1201 North Market Street
8th Floor
Wilmington, Delaware 19801
Attention: Michael Handago
Telecopy: (302) 428-3390
The Chase Manhattan Bank
270 Park Avenue, 38th Floor
New York, New York 10017
Attention: Elizabeth Swerz
Telecopy: (212) 270-7939
provided that any notice, request or demand to or upon the Administrative Agent,
the Issuing Banks or the Lenders pursuant to subsection 2.2, 2.3, 2.4, 2.8, 2.9,
2.10 or 3.2 shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Administrative Agent, the
Canadian Administrative Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All
representations and warranties made hereunder, in the other Loan Documents and
in any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the extensions of credit hereunder.
10.5 Payment of Expenses and Taxes. The Borrowers agree (a)
to pay or reimburse the Administrative Agent, the Canadian Administrative Agent
and the Issuing Banks for all their reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation and execution of, and
any amendment, supplement or modification to, this Agreement and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, the Canadian
Administrative Agent and the Issuing Banks in the amounts agreed to with such
counsel, (b) to pay or reimburse the Issuing Banks, the Administrative Agent,
the Canadian Administrative Agent and, if a Default or an Event of Default shall
have occurred and be continuing, each Lender for all their reasonable
out-of-pocket costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan Documents and
any such other documents, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, to the Canadian
Administrative Agent, to the Issuing Banks and, if a
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Default or an Event of Default shall have occurred and be continuing, to the
several Lenders, (c) to pay, indemnify, and hold each Lender, the Issuing Banks,
the Administrative Agent and the Canadian Administrative Agent harmless from,
any and all recording and filing fees and any and all liabilities with respect
to, or resulting directly from any delay not caused by the Administrative Agent,
the Canadian Administrative Agent, any Issuing Bank or the Lenders in paying,
stamp, excise and other documentary taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of,
or consummation or administration of any of the transactions contemplated by,
or any amendment, supplement or modification of, or any waiver or consent under
or in respect of, this Agreement, the other Loan Documents and any such other
documents, and (d) to pay, indemnify, and hold each Lender, the Issuing Banks,
the Administrative Agent and the Canadian Administrative Agent and each of
their officers, directors, employees and agents harmless from and against any
and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, out-of-pocket expenses or disbursements of any kind
or nature whatsoever incurred in connection with the execution, delivery,
enforcement, performance and administration of this Agreement, the other Loan
Documents and any such other documents, including, without limitation, any of
the foregoing relating to the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of Holdings, any of
its Subsidiaries or any of the Properties (all the foregoing in this clause
(d), collectively, the "indemnified liabilities"), provided, that the Borrowers
shall have no obligation hereunder to the Administrative Agent, the Canadian
Administrative Agent, any Issuing Bank, any Lender with respect to indemnified
liabilities arising from (i) the gross negligence or willful misconduct of the
Administrative Agent, the Canadian Administrative Agent, such Issuing Bank
or any such Lender (ii) legal proceedings commenced against the Administrative
Agent, the Canadian Administrative Agent, any Issuing Bank or any such Lender
by any security holder or creditor thereof arising out of and based upon rights
afforded any such security holder or creditor solely in its capacity as such or
(iii) legal proceedings commenced against the Administrative Agent, the Canadian
Administrative Agent, any Issuing Bank or any Lender by the Borrowers or any of
their Affiliates, in which the Borrowers or such Affiliate is the prevailing
party (unless the Administrative Agent, the Canadian Administrative Agent, such
Issuing Bank or such Lender is also a prevailing party, in which case the
indemnification obligations of the Borrowers hereunder shall be adjusted to
reflect the relative recoveries and faults of the parties to such litigation).
The Borrowers shall have no obligation under this subsection 10.5 for the
consequential damages of the Administrative Agent, the Canadian Administrative
Agent, any Issuing Bank any Lender. The agreements in this subsection shall
survive repayment of the Loans, and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments.
This Agreement shall be binding upon and inure to the benefit of the Borrowers,
the Lenders, the Issuing Banks, the Administrative Agent, the Canadian
Administrative Agent, all future holders of the Loans and their respective
successors and assigns, except that a Borrower may not assign or transfer any of
its rights or obligations under this Agreement (except in a transaction
permitted by subsection 7.5) without the prior written consent of each Lender.
104
(b) Any Lender may, in the ordinary course of its business
and in accordance with applicable law, at any time sell to one or more banks or
other entities ("Participants") participating interests in any Loan owing to
such Lender, any Note held by such Lender, any Revolving Credit Commitment,
Canadian Revolving Credit Commitment or L/C Commitment of such Lender or any
other interest of such Lender hereunder and under the other Loan Documents. In
the event of any such sale by a Lender of a participating interest to a
Participant, such Lender's obligations under this Agreement to the other parties
to this Agreement shall remain unchanged, such Lender shall remain solely
responsible for the performance thereof, such Lender shall remain the holder of
any such Note for all purposes under this Agreement and the other Loan
Documents, and the Borrowers, the Administrative Agent and the Canadian
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents; provided that such Lender shall reserve solely unto
itself, and shall not grant to any Participant, any part or all of its right to
agree to the amendment, modification or waiver of any of the terms of this
Agreement or other Loan Document or any document related thereto, except for any
such amendment, modification or waiver that would reduce the principal of, or
interest on the Loans, participating interests in the Letters of Credit or any
fees payable hereunder, in each case subject to such participation, or postpone
the date of the final maturity of, or any scheduled date fixed for payment of
interest on, the Loans, any Reimbursement Obligation or any Acceptance
Reimbursement Obligation, in each case to the extent subject to such
participation. Each Borrower agrees that if amounts outstanding under this
Agreement are due or unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each Participant
shall, to the maximum extent permitted by applicable law, be deemed to have the
right of setoff in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement or any Note, provided
that, in purchasing such participating interest, such Participant shall be
deemed to have agreed to share with the Lenders the proceeds thereof as provided
in subsection 10.7(a) as fully as if it were a Lender hereunder. Each Borrower
also agrees that each Participant shall be entitled to the benefits of
subsections 2.17, 2.18 and 2.19 with respect to its participation in the
Commitments and the Loans outstanding from time to time as if it were a Lender;
provided that, in the case of subsection 2.18, such Participant shall have
complied with the requirements of said subsection as if it were a Lender, except
with respect to the furnishing of forms, documentation and certifications, in
which case such Participant shall have complied with the requirements of
subsection 2.18(b), and provided, further, that no Participant shall be entitled
to receive any greater amount pursuant to any such subsection than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred by such transferor Lender to such Participant
had no such transfer occurred.
(c) Any Lender may, in accordance with applicable law, at any
time and from time to time assign to any Lender or any Affiliate thereof, or,
with the consent of the Company, the applicable Issuing Banks and the
Administrative Agent (which in each case shall not be unreasonably withheld), to
an additional bank, fund (as long as such fund invests in bank loans) or other
financial institution (an "Assignee") all or any part of its rights and
obligations under this Agreement pursuant to an Assignment and Acceptance,
substantially in the form of Exhibit
105
C, executed by such Assignee, such assigning Lender (and, in the case of an
Assignee that is not then a Lender or an Affiliate thereof, by the Company,
the applicable Issuing Banks and the Administrative Agent) and delivered to
the Administrative Agent (which shall deliver a copy to the Canadian
Administrative Agent) for its acceptance and recording in the Register. Any
such assignment by any Lender to any Person which is not then a Lender or an
Affiliate thereof shall be in a minimum aggregate amount equal to at least
$5,000,000 (or the Dollar Equivalent Amount with respect thereto) (or, if
less, all of a Lender's interest under this Agreement), unless otherwise
agreed by the Company and the Administrative Agent, and, after giving effect
to any such assignment, the assigning Lender and its Affiliates shall have
Commitments of at least $5,000,000, unless otherwise agreed by the Company
and the Administrative Agent. Interests under the Canadian Revolving
Credit Commitments may be assigned only to Canadian Scheduled Lenders.
Notwithstanding any other provision of this subsection 10.6, (i) no Canadian
Schedule I Lender having both a Revolving Credit Commitment and a Canadian
Revolving Credit Commitment shall be permitted to assign any portion of its
interests under this Agreement unless, after giving effect to such assignment,
such Lender shall be able to comply with a reallocation of Commitments pursuant
to subsection 2.4, (ii) no Lender may assign any portion of its interests under
this Agreement unless, after giving effect to such assignment, such Lender,
together with its affiliated Allocation Lender, shall be able to comply with a
reallocation of Commitments pursuant to subsection 2.4 and (iii) no Assignee
shall receive any assignment of rights and obligations under this Agreement
unless, after giving effect to such assignment, such Assignee (or such Assignee
together with a Lender that is an Affiliate thereof) shall be able to comply
with a reallocation of Commitments pursuant to subsection 2.4. Upon such
execution, delivery, acceptance and recording, from and after the effective date
determined pursuant to such Assignment and Acceptance, (x) the Assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
with a Revolving Credit Commitment and/or Canadian Revolving Credit Commitments
as set forth therein, and (y) the assigning Lender thereunder shall, to the
extent provided in such Assignment and Acceptance, be 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 assigning Lender shall cease to be a
party hereto). Notwithstanding any provision of this subsection to the contrary,
the consent of the Company to an assignment shall not be required at any time
when an Event of Default under paragraph (a) or (n) of subsection 8.1 shall have
occurred and be continuing.
(d) Each of the Administrative Agent and the Canadian
Administrative Agent shall maintain at its address referred to in subsection
10.2 a copy of each Assignment and Acceptance delivered to it and a register
(the "Register") for the recordation of the names and addresses of the Lenders
and the Commitment of, and principal amount of the Loans owing to, each Lender
from time to time. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrowers, the Administrative Agent, the
Canadian Administrative Agent and the Lenders may treat each Person whose name
is recorded in the Register as the owner of the Loans and any Notes evidencing
such Loans recorded therein for all purposes of this Agreement. Any assignment
of any Loan, whether or not evidenced by a Note, shall be effective only upon
appropriate entries with respect thereto being made in the Register (and each
Note shall expressly so provide). Any assignment or transfer of all or part of a
Loan evidenced by a
106
Note shall be registered on the Register only upon surrender for registration
of assignment or transfer of the Note evidencing such Loan, accompanied by
a duly executed Assignment and Acceptance; thereupon one or more new Notes
in the same aggregate principal amount shall be issued to the designated
Assignee, and the old Notes shall be returned by the Administrative Agent
to the Company marked "cancelled". The Register shall be available for
inspection by the Borrowers or any Lender at any reasonable time and from time
to time upon reasonable prior notice. It is understood that the Canadian
Administrative Agent shall be required to maintain the Register only with
respect to the Canadian Revolving Credit Commitments and the Administrative
Agent may, but shall not be required to, maintain the Register with respect to
Canadian Revolving Credit Commitments and extensions of credit thereunder.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an Assignee (and, in the case of an Assignee that is
not then a Lender or an Affiliate thereof, by the Company, the applicable
Issuing Banks and the Administrative Agent) together with payment to the
Administrative Agent of a registration and processing fee of $3,500 (which the
fee shall not be payable in connection with an assignment by a Lender to an
Affiliate thereof), the Administrative Agent shall (i) promptly accept such
Assignment and Acceptance and (ii) on the effective date determined pursuant
thereto record the information contained therein in the Register and give notice
of such acceptance and recordation to the Borrowers. On or prior to such
effective date, the applicable Borrower, at its own expense, upon request, shall
execute and deliver to the Administrative Agent or the Canadian Administrative
Agent, as the case may be (in exchange for the Notes of the assigning Lender),
new Notes to the order of such Assignee in an amount equal to the Revolving
Credit Commitment and/or Canadian Revolving Credit Commitment, as the case may
be, assumed or acquired by it pursuant to such Assignment and Acceptance and, if
the assigning Lender has retained a Revolving Credit Commitment and/or Canadian
Revolving Credit Commitment, as the case may be, upon request, new Notes to the
order of the assigning Lender in an amount equal to the Revolving Credit
Commitment and/or Canadian Revolving Credit Commitment, as the case may be,
retained by it hereunder. Such new Notes shall be dated the Effective Date and
shall otherwise be in the form of the Notes replaced thereby.
(f) Each Borrower authorizes each Lender to disclose to any
Participant or Assignee (each, a "Transferee") and any prospective Transferee,
subject to the provisions of subsection 10.15, any and all financial information
in such Lender's possession concerning the Borrowers and their Affiliates which
has been delivered to such Lender by or on behalf of the Borrowers pursuant to
this Agreement or which has been delivered to such Lender by or on behalf of the
Borrowers in connection with such Lender's credit evaluation of the Borrowers
and their Affiliates prior to becoming a party to this Agreement.
(g) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this subsection concerning assignments of
Loans and Notes relate only to absolute assignments and that such provisions do
not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law.
107
10.7 Adjustments; Set-off. Except to the extent that this
Agreement and the other Loan Documents provide for payments to be allocated to a
particular Lender or to the Lenders under a particular Facility, if any Lender
(a "Benefitted Lender") shall at any time receive any payment of all or part of
the Obligations owing to it, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in subsection 8.1(n), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of such other Lender's Obligations, such Benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Obligations, or shall provide such
other Lenders with the benefits of any such collateral, or the proceeds thereof,
as shall be necessary to cause such Benefitted Lender to share the excess
payment or benefits of such collateral or proceeds ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders
provided by law so long as a Default or an Event of Default shall have occurred
and be continuing, each Lender shall have the right, without prior notice to the
Borrowers, any such notice being expressly waived by each Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by either
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of such Borrower. Each Lender agrees
promptly to notify the applicable Borrower and the Administrative Agent 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.
10.8 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Company and the
Administrative Agent.
10.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan
Documents represent the agreement of the Borrowers, the Agents, the Issuing
Banks and the Lenders with respect to the subject matter hereof, and there are
no promises, undertakings, representations or warranties by
108
the Agents, the Issuing Banks or any Lender relative to subject matter hereof
not expressly set forth or referred to herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (UNLESS EXPRESSLY STATED OTHERWISE IN A LOAN DOCUMENT) AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(UNLESS EXPRESSLY STATED OTHERWISE IN A LOAN DOCUMENT) SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. Each Borrower
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action
or proceeding relating to this Agreement and the other Loan Documents
to which it is a party, or for recognition and enforcement of any
judgement in respect thereof, to the non-exclusive general
jurisdiction of the Courts of the State of New York, the courts of the
United States of America for the Southern District of New York, and
appellate courts from any thereof and the courts of the Province of
Ontario;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to such Borrower at its address set forth in subsection 10.2
or at such other address of which the Administrative Agent or the
Canadian Administrative Agent, as the case may be, shall have been
notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or
proceeding referred to in this subsection any special, exemplary,
punitive or consequential damages; provided that any such waiver shall
not apply with respect to claims arising from the gross negligence or
willful misconduct of the Administrative Agent, the Canadian
Administrative Agent, any Issuing Bank or any Lender.
10.13 Acknowledgments. Each Borrower hereby acknowledges
109
that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent, the Canadian
Administrative Agent nor any Lender has any fiduciary relationship
with or duty to either Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent, the Canadian Administrative
Agent and Lenders, on one hand, and the Borrowers, on the other hand,
in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrowers and the
Lenders.
10.14 WAIVERS OF JURY TRIAL. EACH BORROWER, THE
ADMINISTRATIVE AGENT, THE CANADIAN ADMINISTRATIVE AGENT, THE ISSUING BANKS AND
THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
10.15 Confidentiality. Each Lender agrees to keep
confidential all non-public information provided to it by either Borrower or any
Loan Party pursuant to this Agreement or any Loan Document or in connection with
the transactions contemplated by this Agreement or any Loan Document that is
designated by a Borrower in writing as confidential; provided that nothing
herein shall prevent any Lender from disclosing any such information (i) to the
Administrative Agent, the Canadian Administrative Agent or any other Lender,
(ii) to any Transferee which executes a Confidentiality Agreement substantially
in the form of Exhibit D hereto, (iii) to its employees, directors, agents,
attorneys, accountants and other professional advisors, (iv) upon the request or
demand of any Governmental Authority (including, without limitation, the
National Association of Insurance Commissioners) having jurisdiction over such
Lender, (v) in response to any order of any court or other Governmental
Authority or as may otherwise be required pursuant to any Requirement of Law,
(vi) which has been publicly disclosed other than in breach by such Lender of
this Agreement, (vii) in connection with the exercise of any remedy hereunder,
(viii) in connection with periodic regulatory examinations, (ix) in connection
with any litigation to which such Lender may be a party, (x) to any direct or
indirect contractual counterparty in swap agreements or such contractual
counterparty's professional advisor (so long as such contractual counterparty or
professional advisor to such contractual counterparty (A) has been approved in
writing by the Company and (B) agrees in a writing enforceable by the Company to
be bound by the provisions of this subsection 10.15) and (xi) if, prior to such
information having been so provided or obtained, such information was already in
the Administrative Agent's, the Canadian Administrative Agent's, or a Lender's
possession on a nonconfidential basis without a duty of confidentiality to such
Borrower or any Loan Party being violated.
110
10.16 Conversion of Currencies. (a) If, for the purpose of
obtaining judgment in any court, it is necessary to convert a sum due hereunder
or under any other Loan Document in Dollars or Canadian Dollars into another
currency, the parties hereto agree, to the fullest extent that they may legally
and effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent or the
Canadian Administrative Agent, as the case may be, could purchase Dollars or
Canadian Dollars, as the case may be, with such other currency in New York, New
York or Toronto, Canada, as the case may be, on the Business Day immediately
preceding the day on which final judgment is given.
(b) The obligation of each Borrower in respect of any sum due
to the Administrative Agent, the Canadian Administrative Agent, any Lender or
any Issuing Bank hereunder or under any other Loan Document in Dollars shall, to
the extent permitted by applicable law, notwithstanding any judgment in a
currency other than Dollars, be discharged only to the extent that on the
Business Day following receipt of any sum adjudged to be so due in the judgment
currency the Administrative Agent, the Canadian Administrative Agent, such
Lender or such Issuing Bank may in accordance with normal banking procedures
purchase Dollars in the amount originally due to the Administrative Agent, the
Canadian Administrative Agent, such Lender or such Issuing Bank with the
judgment currency. If the amount of Dollars so purchased is less than the sum
originally due to the Administrative Agent, the Canadian Administrative Agent,
such Lender or such Issuing Bank, the applicable Borrower agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the
Administrative Agent, the Canadian Administrative Agent, such Lender or such
Issuing Bank against the resulting loss, and if the amount of Dollars so
purchased exceeds the sum originally due to such Person in Dollars, such Person
shall permit such excess to the Company.
(c) The obligation of each Borrower in respect of any sum due
to the Canadian Administrative Agent, the Administrative Agent, any Canadian
Revolving Credit Lender or any Issuing Bank hereunder or under any other Loan
Document in Canadian Dollars shall, to the extent permitted by applicable law,
notwithstanding any judgment in a currency other than Canadian Dollars, be
discharged only to the extent that on the Business Day following receipt of any
sum adjudged to be so due in the judgment currency the Canadian Administrative
Agent, the Administrative Agent, such Canadian Revolving Credit Lender or such
Issuing Bank may in accordance with normal banking procedures purchase Canadian
Dollars in the amount originally due to the Canadian Administrative Agent, the
Administrative Agent, such Canadian Revolving Credit Lender or such Issuing Bank
with the judgment currency. If the amount of Canadian Dollars so purchased is
less than the sum originally due to the Canadian Administrative Agent, the
Administrative Agent, such Canadian Revolving Credit Lender or such Issuing
Bank, each Borrower agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify the Canadian Administrative Agent, the
Administrative Agent, such Canadian Revolving Credit Lender or such Issuing Bank
against the resulting loss.
111
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
GENERAL CHEMICAL INDUSTRIAL
PRODUCTS INC.
By: ___________________________________
Title:
GENERAL CHEMICAL CANADA LTD.
By: ___________________________________
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent, as an
Issuing Bank and as a Lender
By: ___________________________________
Title:
THE CHASE MANHATTAN BANK OF
CANADA, as Canadian Administrative
Agent and as a Lender
By: ___________________________________
Title:
CHASE MANHATTAN BANK DELAWARE,
as an Issuing Bank
By: ___________________________________
Title:
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THE BANK OF NOVA SCOTIA, as
Syndication Agent and as a
Lender
By: ___________________________________
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Documentation Agent and as a
Lender
By: ___________________________________
Title:
Annex A
PRICING GRID FOR LOANS AND COMMITMENT FEES
- --------------------------------------------------------------------------------------------------------------------
Applicable Margin for
Applicable Margin for ABR Loans, Canadian Base
Eurodollar Loans Rate Loans and Canadian
Pricing Ratio and Stamping Fee Prime Rate Loans Commitment Fee Rate
- --------------------------------------------------------------------------------------------------------------------
> 5.25 3.25% 2.00% .500%
- --------------------------------------------------------------------------------------------------------------------
> 4.75 < 5.25 3.00 1.75 .500
-
- --------------------------------------------------------------------------------------------------------------------
> 4.25 < 4.75 2.75 1.50 .500
-
- --------------------------------------------------------------------------------------------------------------------
> 3.75 < 4.25 2.50 1.25 .500
-
- --------------------------------------------------------------------------------------------------------------------
3.75 2.25 1.00 .500
- --------------------------------------------------------------------------------------------------------------------
Changes in the Applicable Margin and Commitment Fee Rate resulting from changes
in the Pricing Ratio (as defined below) shall become effective on the date (the
"Adjustment Date") on which financial statements are delivered to the Lenders
pursuant to subsection 6.1 (but in any event not later than the 60th day after
the end of each of the first three quarterly periods of each fiscal year or the
90th day after the end of each fiscal year, as the case may be), beginning with
the financial statements delivered for the fiscal quarter ending December 31,
1999, and shall remain in effect until the next change to be effected pursuant
to this paragraph. If any financial statements referred to above are not
delivered within the time periods specified above, then, until such financial
statements are delivered, the Pricing Ratio as at the end of the fiscal period
that would have been covered thereby shall for the purposes of this definition
be deemed to be greater than 5.25 to 1. In addition, at all times while an Event
of Default shall have occurred and be continuing, the Pricing Ratio shall for
the purposes of this definition be deemed to be greater than 5.25 to 1. Each
determination of the Pricing Ratio pursuant to this definition shall be made
with respect to the period of four consecutive fiscal quarters of the Company
ending at the end of the period covered by the relevant financial statements.
"Pricing Ratio" means, as at the last day of any fiscal quarter of the Company,
the Pro Forma Ratio of (a) Funded Debt as at such day to (b) Consolidated Cash
Flow for the period of four fiscal quarters ending on such day.
"Funded Debt" means, as to any Person, all Indebtedness of such Person that
matures more than one year from the date of its creation or matures within one
year from such date but is renewable or extendible, at the option of such
Person, to a date more than one year from such date or arises under a revolving
credit or similar agreement that obligates the lender or lenders to extend
credit during a period of more than one year from such date, including all
current maturities and current
sinking fund payments in respect of such Indebtedness whether or not required
to be paid within one year from the date of its creation and, in the case of
a Borrower, Indebtedness in respect of the Loans. Notwithstanding anything
in the foregoing to the contrary, Funded Debt shall exclude Indebtedness and
Guarantee Obligations of a Person in respect of reclamation bonds, performance
bonds, letters of credit and surety bonds required by the applicable statutes
or laws of the relevant jurisdiction or by relevant Government Authorities
(or, in the case of such letters of credit, issued for insurance purposes).