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EXHIBIT 10.2
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SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of July 11, 1997
among
AMERISERVE FOOD DISTRIBUTION, INC.,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Administrative Agent,
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION,
as Documentation Agent,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Letter of Credit Issuing Lender
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
Arranged by
BANCAMERICA SECURITIES, INC.
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TABLE OF CONTENTS
Section Page
ARTICLE I DEFINITIONS ................................................... 1
1.1 Certain Defined Terms ........................................ 1
1.2 Other Interpretive Provisions ................................ 29
1.3 Accounting Principles ........................................ 29
ARTICLE II THE CREDITS .................................................. 30
2.1 Amounts and Terms of Commitments ............................. 30
(a) The Term A Credit ........................................ 30
(b) The Term B Credit ........................................ 30
(c) The Term C Credit ........................................ 30
(d) The Term D Credit ........................................ 30
(e) The Revolving Credit ..................................... 30
2.2 Loan Accounts ................................................ 31
2.3 Procedure for Borrowing ...................................... 31
2.4 Conversion and Continuation Elections ........................ 32
2.5 Voluntary Termination or Reduction of Commitments ............ 33
2.6 Optional Prepayments ......................................... 34
2.7 Mandatory Prepayments of Loans; Mandatory Commitment
Reductions ................................................. 34
2.8 Repayment .................................................... 36
(a) The Term A Credit ........................................ 36
(b) The Term B Credit ........................................ 37
(c) The Term C Credit ........................................ 38
(d) The Term D Credit ........................................ 39
(e) The Revolving Credit ..................................... 40
2.9 Interest ..................................................... 40
2.10 Fees ......................................................... 41
(a) Arrangement, Agency Fees ................................. 41
(b) Commitment Fees .......................................... 41
2.11 Computation of Fees and Interest ............................. 42
2.12 Payments by the Company ...................................... 42
2.13 Payments by the Lenders to the Administrative Agent .......... 42
2.14 Sharing of Payments, etc. .................................... 43
ARTICLE III THE LETTERS OF CREDIT ....................................... 44
3.1 The Letter of Credit Subfacility ............................. 44
3.2 Issuance, Amendment and Renewal of Letters of Credit ......... 45
3.3 Existing Letters of Credit; Risk Participations,
Drawings and Reimbursements ................................ 47
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Section Page
3.4 Repayment of Participations .................................. 49
3.5 Role of the Issuing Lender ................................... 49
3.6 Obligations Absolute ......................................... 50
3.7 Cash Collateral Pledge ....................................... 51
3.8 Letter of Credit Fees ........................................ 51
3.9 Uniform Customs and Practice ................................. 52
ARTICLE IV TAXES, YIELD PROTECTION AND ILLEGALITY ....................... 52
4.1 Taxes ........................................................ 52
4.2 Illegality ................................................... 53
4.3 Increased Costs and Reduction of Return ...................... 54
4.4 Funding Losses ............................................... 54
4.5 Inability to Determine Rates ................................. 55
4.6 Substitution of Affected Lender .............................. 55
4.7 Certificates of Lenders ...................................... 55
4.8 Survival ..................................................... 56
ARTICLE V COLLATERAL AND GUARANTY ....................................... 56
5.1 Collateral--Personal Property ................................ 56
5.2 Mortgages .................................................... 56
5.3 Guaranty ..................................................... 56
5.4 Company Stock ................................................ 56
5.5 Intercreditor Agreement ...................................... 56
ARTICLE VI CONDITIONS PRECEDENT ......................................... 57
6.1 Conditions of Restatement .................................... 57
(a) Credit Agreement and Notes ............................... 57
(b) Resolutions; Incumbency .................................. 57
(c) Organization Documents ................................... 57
(d) Legal Opinions ........................................... 57
(e) Certificate .............................................. 57
(f) Collateral Documents ..................................... 58
(g) Insurance Policies ....................................... 59
(h) Environmental Review ..................................... 59
(i) Other Documents .......................................... 59
6.2 Other Conditions to Effectiveness of Restatement ............. 59
(a) PFS Acquisition .......................................... 59
(b) Equity Contribution ...................................... 59
(c) Subordinated Debt ........................................ 60
(d) Accounts Receivables Securitization ...................... 60
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Section Page
(e) Post ..................................................... 60
(f) Existing Preferred Stock ................................. 60
(g) Indebtedness ............................................. 60
(h) Governmental Approvals ................................... 60
(i) Certificate .............................................. 60
(j) Purchase by Lenders ...................................... 60
6.3 Conditions to All Credit Extensions .......................... 61
(a) Notice, Application ...................................... 61
(b) Continuation of Representations and Warranties ........... 61
(c) No Existing Default ...................................... 61
ARTICLE VII REPRESENTATIONS AND WARRANTIES .............................. 61
7.1 Corporate Existence and Power ................................ 61
7.2 Corporate Authorization; No Contravention .................... 62
7.3 Governmental Authorization ................................... 62
7.4 Binding Effect ............................................... 62
7.5 Litigation ................................................... 62
7.6 No Default ................................................... 63
7.7 ERISA Compliance ............................................. 63
7.8 Use of Proceeds; Margin Regulations .......................... 63
7.9 Title to Properties .......................................... 63
7.10 Taxes ........................................................ 64
7.11 Financial Condition .......................................... 64
7.12 Environmental Matters ........................................ 65
7.13 Regulated Entities ........................................... 66
7.14 No Burdensome Restrictions ................................... 66
7.15 Copyrights, Patents, Trademarks and Licenses, etc. ........... 66
7.16 Subsidiaries ................................................. 66
7.17 Insurance .................................................... 66
7.18 Full Disclosure .............................................. 66
ARTICLE VIII AFFIRMATIVE COVENANTS ...................................... 67
8.1 Financial Statements ......................................... 67
8.2 Certificates; Other Information .............................. 68
8.3 Notices ...................................................... 69
8.4 Preservation of Corporate Existence, etc. .................... 70
8.5 Maintenance of Property ...................................... 70
8.6 Insurance .................................................... 70
8.7 Payment of Obligations ....................................... 70
8.8 Compliance with Laws ......................................... 71
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Section Page
8.9 Compliance with ERISA ........................................ 71
8.10 Inspection of Property and Books and Records ................. 71
8.11 Environmental Laws ........................................... 71
8.12 Hedging Agreements ........................................... 71
8.13 Use of Proceeds .............................................. 71
8.14 Further Assurances ........................................... 72
ARTICLE IX NEGATIVE COVENANTS ........................................... 72
9.1 Limitation on Liens .......................................... 72
9.2 Asset Dispositions, etc. ..................................... 74
9.3 Consolidations and Mergers ................................... 75
9.4 Loans and Investments ........................................ 75
9.5 Limitation on Indebtedness ................................... 76
9.6 Transactions with Affiliates ................................. 77
9.7 Use of Proceeds .............................................. 77
9.8 Contingent Obligations ....................................... 77
9.9 Joint Ventures ............................................... 78
9.10 Rental Obligations ........................................... 78
9.11 Restricted Payments .......................................... 78
9.12 Minimum Fixed Charge Coverage ................................ 79
9.13 Minimum Interest Coverage .................................... 79
9.14 Maximum Leverage ............................................. 80
9.15 ERISA ........................................................ 80
9.16 Modification of Certain Agreements ........................... 80
9.17 Negative Pledges, Restrictive Agreements, etc. ............... 80
9.18 Maximum Capital Expenditures ................................. 81
9.19 Change in Business ........................................... 81
9.20 Accounting Changes ........................................... 81
9.21 Restructuring Costs .......................................... 81
ARTICLE X EVENTS OF DEFAULT ............................................. 82
10.1 Event of Default ............................................. 82
(a) Non-Payment .............................................. 82
(b) Representation or Warranty ............................... 82
(c) Specific Defaults ........................................ 82
(d) Other Defaults ........................................... 82
(e) Cross-Default ............................................ 82
(f) Insolvency; Voluntary Proceedings ........................ 83
(g) Involuntary Proceedings .................................. 83
(h) ERISA .................................................... 83
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Section Page
(i) Monetary Judgments ....................................... 84
(j) Non-Monetary Judgments ................................... 84
(k) Change of Control ........................................ 84
(l) Impairment of Security, etc. ............................. 84
10.2 Remedies ..................................................... 84
10.3 Rights Not Exclusive ......................................... 85
ARTICLE XI THE AGENTS ................................................... 85
11.1 Appointment and Authorization ................................ 85
11.2 Delegation of Duties ......................................... 86
11.3 Liability of Administrative Agent ............................ 86
11.4 Reliance by Administrative Agent ............................. 86
11.5 Notice of Default ............................................ 87
11.6 Credit Decision .............................................. 87
11.7 Indemnification of Administrative Agent ...................... 87
11.8 Administrative Agent in Individual Capacity .................. 88
11.9 Successor Agent .............................................. 88
11.10 Withholding Tax .............................................. 88
11.11 Collateral Matters ........................................... 90
11.12 Documentation Agent .......................................... 91
ARTICLE XII MISCELLANEOUS ............................................... 91
12.1 Amendments and Waivers ....................................... 91
12.2 Notices ...................................................... 92
12.3 No Waiver; Cumulative Remedies ............................... 92
12.4 Costs and Expenses ........................................... 93
12.5 Company Indemnification ...................................... 93
12.6 Payments Set Aside ........................................... 93
12.7 Successors and Assigns ....................................... 94
12.8 Assignments, Participations, etc. ............................ 94
12.9 Confidentiality .............................................. 95
12.10 Set-off ...................................................... 96
12.11 Automatic Debits of Fees ..................................... 96
12.12 Notification of Addresses, Lending Offices, etc. ............. 97
12.13 Counterparts ................................................. 97
12.14 Severability ................................................. 97
12.15 No Third Parties Benefited ................................... 97
12.16 Governing Law and Jurisdiction ............................... 97
12.17 Waiver of Jury Trial ......................................... 97
12.18 Entire Agreement ............................................. 98
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SCHEDULES
Schedule 2.1 Commitments
Schedule 3.3 Existing Letters of Credit
Schedule 7.5 Litigation
Schedule 7.7 ERISA
Schedule 7.11 Permitted Obligations
Schedule 7.12 Environmental Matters
Schedule 7.15 Copyrights, Patents, Trademarks, Licenses and Related Matters
Schedule 7.16 Subsidiaries and Minority Interests
Schedule 7.17 Insurance Matters
Schedule 9.1 Permitted Liens
Schedule 9.4 Existing Investments
Schedule 9.5 Permitted Indebtedness
Schedule 9.8 Contingent Obligations
Schedule 12.2 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Note
Exhibit E Form of Legal Opinion of Wachtell, Lipton, Rosen & Katz
Exhibit F Form of Legal Opinion of Cassem, Tierney, Adams, Gotch and
Douglas
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Guaranty
Exhibit I Form of NEHC Guaranty
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SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
This SECOND AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of
July 11, 1997, among AmeriServe Food Distribution, Inc. (formerly known as Nebco
Evans Distribution, Inc.), a Nebraska corporation (the "Company"), the several
financial institutions from time to time party to this Agreement (collectively
the "Lenders"; individually each a "Lender"), Bank of America National Trust
and Savings Association, as letter of credit issuing bank, Bank of America
National Trust and Savings Association, as administrative agent for the Lenders,
and Donaldson, Lufkin & Jenrette Securities Corporation, as documentation agent.
WHEREAS, the Company, certain financial institutions, Bank of America
Illinois, as letter of credit issuing bank, and Bank of America National Trust
and Savings Association, as agent, are parties to an Amended and Restated Credit
Agreement dated as of March 26, 1997, as heretofore amended (as so amended the
"Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed to amend and restate the Existing
Credit Agreement so as to, among other things, (a) increase the amount of the
facilities, in part to finance the purchase of PFS, a division of PepsiCo, Inc.,
(b) amend the pricing, certain covenants and certain various other provisions of
the Existing Credit Agreement and (c) revise in certain respects the composition
of the lender group; and
WHEREAS, the parties hereto intend that this Agreement and the Loan
Documents executed in connection herewith not effect a novation of the
obligations of the Company under the Existing Credit Agreement and the "Loan
Documents" (as defined in the Existing Credit Agreement), but merely a
restatement, and where applicable, an amendment to the terms governing such
obligations;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the Existing Credit Agreement shall be amended and
restated to read in its entirety as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms. The following terms have the following
meanings:
Acquisition means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the
acquisition of all or substantially all of the assets of a Person, or of
any business or division of a Person, (b) the acquisition of in excess of
50% of the capital stock, partnership interests, membership interests or
equity of any Person, or otherwise causing any Person to
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become a Subsidiary, or (c) a merger or consolidation or any other
combination with another Person (other than a Person that is a Subsidiary)
provided that the Company or the Subsidiary is the surviving entity.
Acquisition EBITDA means for any four fiscal quarter period, if the
Company makes an Acquisition during such period, the EBITDA of such
acquired entity as if the Acquisition had taken place on the first day of
such period.
Adjusted EBITDA means as at the end of any fiscal quarter for the
four fiscal quarters (or, if shorter, the period from the Closing Date)
then ending (a) the Company's consolidated EBITDA plus (b) Receivables
Financing Costs deducted in the calculation of EBITDA plus (c) any cash
restructuring charges taken in the 1997, 1998, and 1999 fiscal years
related to the AmeriServ Acquisition or the PFS Acquisition which are
reflected in the operating expenses of the Company's income statement (but
not in excess of $15,000,000 in each of fiscal years 1997, 1998 and 1999)
plus (d) APA Cost Reductions for the four fiscal quarter period ended on
or before March 31, 1998 plus (e) Arby's EBITDA for any four fiscal
quarter period ended on or before December 31, 1997 plus (f) LTM EBITDA
for any four fiscal quarter period ended on or before March 31, 1998;
provided that for the purpose of the calculation of the Leverage Ratio
only, Acquisition EBITDA will be added in the calculation of Adjusted
EBITDA.
Adjusted Funded Debt means all Indebtedness plus the Invested Amount
of the Company and its Subsidiaries, excluding Indebtedness of the Company
to Subsidiaries or of Subsidiaries to the Company or other Subsidiaries;
provided, however, that cash and Cash Equivalent Investments shall be
subtracted from Indebtedness in the calculation of Adjusted Funded Debt at
any time on or before December 31, 1997.
Adjusted Interest Expense means Interest Expense plus Receivables
Financing Costs.
Administrative Agent means BofA in its capacity as agent for the
Lenders hereunder, and any successor agent arising under Section 11.9.
Administrative Agent's Payment Office means the address for payments
set forth on Schedule 12.2 hereto in relation to the Administrative Agent,
or such other address as the Administrative Agent may from time to time
specify.
Affected Lender means any Lender that has given notice to the
Company (which has not been rescinded) of (i) any obligation by the
Company to pay any amount pursuant to Section 4.1 or 4.3 or (ii) the
occurrence of any circumstances of the nature described in Section 4.2.
Affiliate means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another
Person if the controlling Person
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possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by
contract, or otherwise, or in the case of any Lender which is an
investment fund, any other fund which is advised by the same investment
advisor or an Affiliate thereof.
Agent-Related Persons means BofA and any successor Administrative
Agent arising under Section 11.9 and any successor letter of credit
issuing bank hereunder, together with their respective Affiliates
(including, in the case of BofA, the Arranger), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
Agents means the Administrative Agent and the Documentation Agent.
Agreement means this Credit Agreement.
AmeriServ Acquisition means the acquisition by the Company of the
stock of AmeriServ Food Company in January 1996.
APA Cost Reductions means those cost reductions described in the PFS
Acquisition Agreement, which shall be $8,325,000 for the four fiscal
quarter period ended September 30, 1997, $5,550,000 for the four fiscal
quarter period ended December 31, 1997 and $2,775,000 for the four fiscal
quarter period ended March 31, 1998.
Applicable Base Rate Margin means (a) initially, 1.25% in the case
of any Revolving Loan or Term A Loan, (b) 1.75% in the case of any Term B
Loan, (c) 2.00% in the case of any Term C Loan, (d) 2.25% in the case of
any Term D Loan and (b) on and after any date specified below on which the
Applicable Base Rate Margin is to be adjusted for Revolving Loans and Term
A Loans, the rate per annum set forth in the table below for the
applicable Loan opposite the applicable Leverage Ratio:
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Leverage Ratio Applicable Base Rate Margin for
Revolving Loans and Term A
Loans
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Less than 4.0 to 1.0 0%
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Less than 4.5 to 1.0 0.25%
but greater than or equal to 4.0 to 1.0
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Less than 5.0 to 1.0 0.375%
but greater than or equal to 4.5 to 1.0
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Less than 5.75 to 1.0 1.0%
but greater than or equal to 5.0 to 1.0
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Equal to or greater than 5.75 to 1.0 1.25%
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The Applicable Base Rate Margin shall be adjusted, to the extent
applicable, 45 days (or, in the case of the last calendar quarter of any
year, 90 days) after the end of each calendar quarter, based on the
Leverage Ratio as of the last day of such calendar quarter commencing with
the calendar quarter ending December 31, 1997; it being understood that if
the Company fails to deliver the financial statements as required by
subsection 8.1(a) or 8.1 (b), as applicable, and the related Compliance
Certificate required by subsection 8.2(b) by the 45th day (or, if
applicable, the 90th day) after any calendar quarter the Applicable Base
Rate Margin shall be 1.25% for any Revolving Loan or Term A Loan bearing
interest based on the Base Rate until such financial statements and
Compliance Certificate are delivered.
Applicable Offshore Rate Margin means (a) initially 2.50% in the
case of any Revolving Loan or Term A Loan, (B) 3.00% in the case of any
Term B Loan, (C) 3.25% in the case of any Term C Loan, (d) 3.50% in the
case of any Term D Loan and (e) on and after any date specified below on
which the Applicable Offshore Rate Margin is to be adjusted for Revolving
Loans and Term A Loan, the rate per annum set forth in the table below for
the applicable Loan opposite the applicable Leverage Ratio:
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Leverage Ratio Applicable Offshore Rate Margin
for Revolving Loans and Term A
Loans
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Less than 3.0 to 1.0 0.75%
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Less than 3.5 to 1.0 1.0%
but greater than or equal to 3.0 to 1.0
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Less than 4.0 to 1.0 1.25%
but greater than or equal to 3.5 to 1.0
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Less than 4.5 to 1.0 1.50%
but greater than or equal to 4.0 to 1.0
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Less than 5.0 to 1.0 1.875%
but greater than or equal to 4.5 to 1.0
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Less than 5.75 to 1.0 2.25%
but greater than or equal to 5.0 to 1.00
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Equal to or greater than 5.75 to 1.0 2.50%
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The Applicable Offshore Rate Margin shall be adjusted, to the extent
applicable, 45 days (or, in the case of the last calendar quarter of any
year, 90 days) after the end of each calendar quarter, based on the
Leverage Ratio as of the last day of such quarter commencing with the
calendar quarter ending December 31, 1997; it being understood that if the
Company fails to deliver the financial statements required by subsection
8.1(a) or 8.1(b), as applicable, and the related Compliance Certificate
required by subsection 8.2(b) by the 45th day (or, if applicable, the 90th
day) after any calendar quarter, the Applicable Offshore Rate Margin shall
be 2.50% for Revolving Loans and Term A Loans bearing interest based on
the Offshore Rate until such financial statements and Compliance
Certificate are delivered.
Approved Bank has the meaning specified in the definition of "Cash
Equivalent Investments".
Arby's EBITDA means $2,900,000 for the four fiscal quarter period
ended September 30, 1997, and $1,800,000 for the four fiscal quarter
period ended December 31, 1997.
Arranger means BancAmerica Securities, Inc., a Delaware corporation.
Assignee has the meaning specified in subsection 12.8(a).
Attorney Costs means and includes all fees and disbursements of any
law firm or other external counsel, the allocated cost of internal legal
services and all disbursements of internal counsel.
Bankruptcy Code means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. ss.101, et seq.).
Base Rate means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in
effect for such day as publicly announced from time to time by BofA in San
Francisco, California, as its "reference rate." (The "reference rate" is a
rate set by BofA based upon various factors including BofA's costs and
desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at,
above, or below such announced rate.)
Any change in the reference rate announced by BofA shall take effect
at the opening of business on the day specified in the public announcement
of such change.
Base Rate Loan means a Revolving Loan, a Term Loan A, a Term B Loan,
a Term C Loan or Term D Loan that bears interest based on the Base Rate or
an L/C Advance.
BofA means Bank of America National Trust and Savings Association, a
national banking association.
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Borrowing means a borrowing hereunder consisting of Revolving Loans
or Term Loans of the same Type made to the Company on the same day by the
Lenders under Article II, and, other than in the case of Base Rate Loans,
having the same Interest Period.
Borrowing Date means any date on which a Borrowing occurs under
Section 2.3.
Bridge Loan means the up to $350,000,000 of senior subordinated
increasing rate debt issued pursuant to the Securities Purchase Agreement
among DLJ Bridge Finance, Inc., BofA and the Company dated the date
hereof.
Business Day means any day other than a Saturday, Sunday or other
day on which commercial banks in San Francisco are authorized or required
by law to close and, if the applicable Business Day relates to any
Offshore Rate Loan, means such a day on which dealings are carried on in
the applicable offshore dollar interbank market.
Capital Adequacy Regulation means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law, in
each case, regarding capital adequacy of any bank or of any corporation
controlling a bank.
Capital Expenditures means all expenditures which, in accordance
with GAAP, would be required to be capitalized and shown on the
consolidated balance sheet of the Company, but (i) excluding expenditures
made in connection with the replacement, substitution or restoration of
assets to the extent financed (A) from insurance proceeds (or other
similar recoveries) paid on account of the loss of or damage to the assets
being replaced or restored or (B) with awards of compensation arising from
the taking by eminent domain or condemnation of the assets being replaced
and (ii) excluding expenditures incurred by the creation of Capitalized
Lease Obligations and financed thereby.
Capitalized Lease Obligations means all monetary obligations of the
Company or any of its Subsidiaries under any leasing or similar
arrangement which, in accordance with GAAP, would be classified as
capitalized leases, and, for purposes of this Agreement and each other
Loan Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP, and the stated
maturity thereof shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such
lease may be terminated by the lessee without payment of a penalty.
Cash Collateralize means to pledge and deposit with or deliver to
the Administrative Agent, for the benefit of the Agents, the Issuing
Lender and the Lenders, as additional collateral for the L/C Obligations,
cash or deposit account balances pursuant to documentation in form and
substance satisfactory to the
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Administrative Agent and the Issuing Lender (which documents are hereby
consented to by the Lenders). Derivatives of such term shall have a
corresponding meaning. The Company hereby grants the Administrative Agent,
for the benefit of the Agents, the Issuing Lender and the Lenders, a
security interest in all such cash and deposit account balances. Cash
collateral shall be maintained in blocked, interest bearing deposit
accounts at BofA.
Cash Equivalent Investments shall mean (i) securities issued or
directly and fully guaranteed or insured by the United States of America
or any agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than one year from the date of acquisition,
(ii) marketable direct obligations issued by any State of the United
States of America or any local government or other political subdivision
thereof rated (at the time of acquisition of such security) at least AA by
Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc. ("S&P") or the equivalent thereof by Moody's Investors
Service, Inc. ("Moody's") having maturities of not more than one year from
the date of acquisition, (iii) U.S. dollar denominated time deposits,
certificates of deposit and bankers' acceptances of (x) any Lender, (y)
any domestic commercial bank of recognized standing having capital and
surplus in excess of $250,000,000 or (z) any bank whose short-term
commercial paper rating (at the time of acquisition of such security) by
S&P is at least A-1 or the equivalent thereof (any such bank, an "Approved
Bank"), in each case with maturities of not more than six months from the
date of acquisition, (iv) commercial paper and variable or fixed rate
notes issued by any Lender or Approved Bank or by the parent company of
any Lender or Approved Bank and commercial paper and variable rate notes
issued by, or guaranteed by, any industrial or financial company with a
short-term commercial paper rating (at the time of acquisition of such
security) of at least A-1 or the equivalent thereof by S&P or at least P-1
or the equivalent thereof by Moody's, or guaranteed by any industrial
company with a long-term unsecured debt rating (at the time of acquisition
of such security) of at least AA or the equivalent thereof by S&P or at
least Aa or the equivalent thereof by Moody's and in each case maturing
within one year after the date of acquisition and (v) repurchase
agreements with any Lender or any primary dealer maturing within one year
from the date of acquisition that are fully collateralized by investment
instruments that would otherwise be Cash Equivalent Investments; provided
that the terms of such repurchase agreements comply with the guidelines
set forth in the Federal Financial Institutions Examination Council
Supervisory Policy -- Repurchase Agreements of Depository Institutions
With Securities Dealers and Others, as adopted by the Comptroller of the
Currency on October 31, 1985.
Change of Control means the failure of (a) Holberg or its
shareholders, or any thereof, to own directly or indirectly, in excess of
50% of the outstanding shares of voting stock of the Company; (b) the
failure of NEHC to own directly 100% of the outstanding shares of voting
stock of the Company (other than shares under stock options held by, or
issued under stock options to, directors, officers, employees and former
directors not in excess of 10% of the shares of voting stock of the
Company);
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or (c) Holberg Inc. or its shareholders as of the date hereof, or any
thereof, to own at least 50% of the outstanding shares of voting stock of
Holberg. For purposes of this definition, voting stock of a corporation
shall not include capital stock of such corporation if such stock has only
the minimal voting rights required by such corporation's jurisdiction of
organization with respect to any capital stock issued by such corporation.
Closing Date means the date on which all conditions precedent set
forth in Sections 6.1 and 6.2 are satisfied or waived by all Lenders.
Code means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
Collateral means any collateral granted to the Administrative Agent
for the benefit of the Agents, or the Lenders, to secure the Obligations
of the Company, or any Guarantor, under any Loan Document.
Collateral Documents means the Security Agreement, the Pledge
Agreement, the Subsidiary Pledge Agreement, the Trademark Security
Agreement and the NEHC Pledge Agreement.
Commitment means, as to each Lender, such Lender's Revolving
Commitment, Term A Commitment, Term B Commitment, Term C Commitment and
Term D Commitment, as applicable.
Commitment Fee Rate means (a) initially, 0.50% and (b) on and after
any date specified below on which the Commitment Fee Rate is to be
adjusted, the rate per annum set forth in the table below opposite the
applicable Leverage Ratio:
--------------------------------------------------------------------------
Leverage Ratio Commitment Fee Rate
--------------------------------------------------------------------------
Less than 3.0 to 1.0 0.25%
--------------------------------------------------------------------------
Less than 3.5 to 1.0 0.30%
but greater than or equal to 3.0 to 1.0
--------------------------------------------------------------------------
Less than 4.5 to 1.0 0.375%
but greater than or equal to 3.5 to 1.0
--------------------------------------------------------------------------
Equal to or greater than 4.5 to 1.0 0.50%
--------------------------------------------------------------------------
The Commitment Fee Rate shall be adjusted, to the extent applicable, 45
days (or, in the case of the last calendar quarter of any year, 90 days)
after the end of each
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16
calendar quarter, based on the Leverage Ratio as of the last day of such
calendar quarter commencing with the calendar quarter ending December 31,
1997; it being understood that if the Company fails to deliver the
financial statements required by subsection 8.1(a) or 8.1(b), as
applicable, and the related Compliance Certificate required by subsection
8.2(b) by the 45th day (or, if applicable, the 90th day) after any
calendar quarter, the Commitment Fee Rate shall be 0.50% until such
financial statements and Compliance Certificate are delivered.
Compliance Certificate means a certificate substantially in the form
of Exhibit C.
Computation Period means as at any fiscal quarter end, the period of
four consecutive quarters then ending or, if shorter, the period
commencing the Closing Date.
Consolidated Net Income means, with respect to the Company and its
Subsidiaries for any period, the net income (or loss) of the Company and
its Subsidiaries for such period.
Contingent Obligation means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend
(declared and not paid), letter of credit or other obligation (the
"primary obligations") of another Person (the "primary obligor"),
including any obligation of that Person (i) to purchase, repurchase or
otherwise acquire such primary obligations or any security therefor, (ii)
to advance or provide funds for the payment or discharge of any such
primary obligation, or to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency or
any balance sheet item, level of income or financial condition 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
holder of any such primary obligation against loss in respect thereof
(each, a "Guaranty Obligation"); (b) with respect to any Surety Instrument
(other than any Letter of Credit) issued for the account of that Person or
as to which that Person is otherwise liable for reimbursement of drawings
or payments; (c) to purchase any materials, supplies or other property
from, or to obtain the services of, another Person if the relevant
contract or other related document or obligation requires that payment for
such materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or other
property is ever made or tendered, or such services are ever performed or
tendered; or (d) in respect of any Hedging Agreement. The amount of any
Contingent Obligation shall, in the case of Guaranty Obligations, be
deemed equal to the stated or determinable amount of the primary
obligation in respect of which such Guaranty Obligation is made or, if not
stated or if indeterminable, the maximum reasonably anticipated liability
in respect thereof, and in the case of other
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Contingent Obligations, shall be equal to the maximum reasonably
anticipated liability in respect thereof.
Contractual Obligation means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or
agreement to which such Person is a party or by which it or any of its
property is bound.
Conversion/Continuation Date means any date on which, under Section
2.4, the Company (a) converts Loans of one Type to another Type, or (b)
continues as Loans of the same Type, but with a new Interest Period, Loans
having Interest Periods expiring on such date.
Corporate Allocations means the amount paid by the Company to
Holberg for managerial and administration services performed by Holberg
for the Company.
Credit Extension means and includes (a) the making of any Loans
hereunder, and (b) the Issuance of any Letters of Credit hereunder
(including the Existing Letters of Credit).
Default means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
DLJ means Donaldson, Lufkin & Jenrette Securities Corporation.
Documentation Agent means Donaldson, Lufkin & Jenrette Securities
Corporation in its capacity as documentation agent for the Lenders
hereunder.
Dollars, dollars and $ each mean lawful money of the United States.
EBITDA means, for any Computation Period, the sum of
(a) Consolidated Net Income of the Company for such period
excluding, to the extent reflected in determining such Consolidated Net
Income, extraordinary gains and losses for such period and non-recurring
gains and charges,
plus
(b) to the extent deducted in determining Consolidated Net Income,
Interest Expense, income tax expense, depreciation, depletion and
amortization for such period.
Effective Amount means (i) with respect to any Revolving Loans and
Term Loans on any date, the aggregate outstanding principal amount thereof
after giving effect to any Borrowings and prepayments or repayments of
Revolving Loans and
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Term Loans occurring on such date; and (ii) with respect to any
outstanding L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any Issuances of Letters
of Credit occurring on such date and any other changes in the aggregate
amount of the L/C Obligations as of such date, including as a result of
any reimbursements of outstanding unpaid drawings under any Letters of
Credit or any reductions in the maximum amount available for drawing under
Letters of Credit taking effect on such date.
Eligible Assignee means (i) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100,000,000; (ii) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a combined capital
and surplus of at least $100,000,000, provided that such bank is acting
through a branch or agency located in the country in which it is organized
or another country which is also a member of the OECD; (iii) a Person that
is primarily engaged in the business of commercial banking and that is (A)
a Subsidiary of a Lender, (B) a Subsidiary of a Person of which a Lender
is a Subsidiary, or (C) a Person of which a Lender is a Subsidiary and
(iv) as to the Term Loans, an "accredited investor" as such term is
defined in Rule 501(a) of Regulation D under the Securities Act of 1933,
as amended (other than the Company or an Affiliate of the Company).
Environmental Claims means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
Environmental Laws means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with
all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental, health, safety and
land use matters.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and regulations promulgated thereunder.
ERISA Affiliate means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
ERISA Event means (a) a Reportable Event with respect to a Pension
Plan; (b) the failure to make a required contribution to a Pension Plan if
such failure is sufficient to give rise to a Lien under Section 302(f) of
ERISA; (c) a withdrawal by the Company or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which
it was a substantial employer (as defined in
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Section 4001(a)(2) of ERISA) or a cessation of operations which is treated
as such a withdrawal under Section 4062(e) of ERISA; (d) a complete or
partial withdrawal by the Company or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (e) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A
of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (f) an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (g) the imposition of any liability
under Title IV of ERISA, other than PBGC premiums due but not delinquent
under Section 4007 of ERISA, upon the Company or any ERISA Affiliate.
Event of Default means any of the events or circumstances specified
in Section 8.1.
Excess Cash Flow means, for any period, without duplication, (a)
EBITDA for such period; plus (b) net cash extraordinary gains and
nonrecurring gains included in determining Consolidated Net Income for
such period; plus (c) decreases in Working Capital; less (d) increases in
Working Capital; less (e) the amount of cash income taxes deducted in
determining Consolidated Net Income for such period; less (f) the amount
of cash Interest Expense deducted in determining Consolidated Net Income
for such period; less (g) Capital Expenditures (less the amount of any
Indebtedness incurred to finance such Capital Expenditures other than the
Loans hereunder) permitted by Section 9.18 hereof (even if not expended
but without giving effect to any carry-over from a prior year); less (h)
scheduled amortization on the Term Loans or any other Indebtedness
actually paid during such period; less (i) the aggregate of all mandatory
prepayments of the Loans made during such period in accordance with
Section 2.7(c) (other than Section 2.7(c)(v)); less (j) net cash
extraordinary losses and non-recurring charges deducted in determining
Consolidated Net Income for such period; less (k) Restructuring Costs paid
by the Company during such period and not previously deducted in
determining EBITDA and not deducted in determining Consolidated Net Income
for such period; less (l) dividends paid in cash.
Exchange Act means the Securities and Exchange Act of 1934, and
regulations promulgated thereunder.
Existing Credit Agreement has the meaning specified in the recitals.
Existing Letters of Credit means the letters of credit described in
Schedule 3.3.
Federal Funds Rate means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite
the caption "Federal Funds (Effective)"; or,
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20
if for any relevant day such rate is not so published on any such
preceding Business Day, the rate for such day will be the arithmetic mean
as determined by the Administrative Agent of the rates for the last
transaction in overnight Federal funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers of Federal
funds transactions in New York City selected by the Administrative Agent.
Fee Letter has the meaning specified in subsection 2.10(a).
Fixed Charge Coverage Ratio means, for the Computation Period most
recently ended on or before such date, the ratio of (a) Adjusted EBITDA
for such Computation Period less (i) Capital Expenditures for such
Computation Period less (ii) cash taxes paid by the Company and its
Subsidiaries for such Computation Period, to (b) the sum of (i) Adjusted
Interest Expense for such Computation Period, (ii) cash dividends paid by
the Company during such Computation Period, (iii) the required
installments of principal of the Term Loans and (iv) principal
amortization of Capitalized Lease Obligations for such Computation Period.
FRB means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
GAAP means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature
and authority within the U.S. accounting profession); provided that for
the purpose of calculating any financial covenant or financial ratio, GAAP
shall mean such generally accepted accounting principles which are
applicable to the circumstances as of the date hereof and provided further
that upon a change in GAAP which would, if applicable, affect the
calculation of financial covenants or financial ratios, the parties shall
discuss the amendment of such covenants and ratios and the definition of
GAAP.
Governmental Authority means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary
or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
Guarantor means (a) NEHC; (b) as of the date hereof, each Subsidiary
listed on Schedule 7.16; and (c) thereafter, the Persons referred to in
clauses (a) and (b) and each other Person which from time to time executes
and delivers a counterpart of the Guaranty.
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Guaranty means the guaranty of the Guarantors (other than NEHC) in
substantially the form of Exhibit H.
Guaranty Obligation has the meaning specified in the definition of
Contingent Obligation.
Hedging Agreement means any agreement (including any master
agreement and any agreement, whether or not in writing, relating to any
single transaction) that is an interest rate swap agreement, basis swap,
forward rate agreement, commodity swap, commodity option, equity or equity
index swap or option, bond option, interest rate option, forward foreign
exchange agreement, rate cap, collar or floor agreement, currency swap
agreement, cross-currency rate swap agreement, swaption, currency option
or any other, similar agreement (including any option to enter into any of
the foregoing).
Holberg means Holberg Industries, Inc., a Delaware corporation.
Honor Date has the meaning specified in subsection 3.3(c).
Impermissible Qualification means, relative to the opinion or
certification of any independent public accountant as to any financial
statement of any Obligor, any qualification or exception to such opinion
or certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause
such Obligor to be in default of any of its obligations under Sections
9.12, 9.13 or 9.14.
Indebtedness of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than
trade payables entered into in the ordinary course of business on ordinary
terms); (c) all non-contingent reimbursement or payment obligations with
respect to Surety Instruments (it being understood that undrawn letters of
credit are contingent reimbursement obligations); (d) all obligations
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses; (e) all indebtedness created or arising
under any conditional sale or other title retention agreement, or incurred
as financing, in either case with respect to property acquired by the
Person (even though the rights and remedies of the seller or bank under
such agreement in the event of default are limited to repossession or sale
of such property); (f) all Capital Lease Obligations; (g) all net
obligations with respect
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to Hedging Agreements; (h) all indebtedness referred to in clauses (a)
through (g) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien upon or in property (including accounts and
contracts rights) owned by such Person, even though such Person has
not assumed or become liable for the payment of such Indebtedness; and
(i) all Guaranty Obligations in respect of indebtedness or obligations
of others of the kinds referred to in clauses (a) through (g) above.
Indemnified Obligations has the meaning specified in Section 12.5.
Indemnified Person has the meaning specified in Section 12.5.
Independent Auditor has the meaning specified in Section 8.1(b).
Initial Financial Projections means the ten-year projections
provided to the Lenders prior to the date hereof included in the
Information Memorandum dated June, 1997.
Insolvency Proceeding means (a) any case, action or proceeding
before any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the
benefit of creditors, composition, marshalling of assets for creditors, or
other, similar arrangement in respect of its creditors generally or any
substantial portion of its creditors; undertaken under U.S. federal, state
or foreign law, including the Bankruptcy Code.
Intercreditor Agreement means the Intercreditor Agreement dated as
of July 11, 1997 between the Administrative Agent and Norwest Bank
Minnesota, National Association as Trustee under the Pooling and Servicing
Agreement.
Interest Coverage Ratio means, for the Computation Period most
recently ended on or before such date, the ratio of (a) Adjusted EBITDA
for such Computation Period to (b) Adjusted Interest Expense for such
Computation Period.
Interest Expense means, for any period, the consolidated interest
expense of the Company and its Subsidiaries for such period including
interest expense related to Capitalized Lease Obligations.
Interest Payment Date means, as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and, as
to any Base Rate Loan, the last Business Day of each calendar quarter;
provided, however, that if any Interest Period for an Offshore Rate Loan
exceeds three months, the date that falls three months after the beginning
of such Interest Period is also an Interest Payment Date.
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Interest Period means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two, three
or six months thereafter as selected by the Company in its Notice of
Borrowing or Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to the
following 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 preceding Business Day;
(ii) 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 the calendar month at
the end of such Interest Period;
(iii) no Interest Period for any Revolving Loan shall extend
beyond the Revolving Termination Date; and
(iv) no Interest Period applicable to a Term A Loan, a Term B
Loan, a Term C Loan or a Term D Loan or portion of any thereof shall
extend beyond any date upon which is due any scheduled principal
payment in respect of the Term A Loans, Term B Loans, Term C Loans
or Term D Loans, as applicable, unless the aggregate principal
amount of Term A Loans, Term B Loans, Term C Loans or Term D Loans,
as applicable, represented by Base Rate Loans, or by Offshore Rate
Loans having Interest Periods that will expire on or before such
date, equals or exceeds the amount of such principal payment.
Invested Amount means, at any time, the outstanding principal amount
that is owed to holders (other than Subsidiaries of the Company) of
securities issued by, or loans to, the trust established under the Pooling
and Servicing Agreement or any other trust established with respect to a
Qualified Receivables Transaction.
IRS means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
Issuance Date has the meaning specified in subsection 3.1(a).
Issue means, with respect to any Letter of Credit, to incorporate
the Existing Letters of Credit into this Agreement, or to issue or to
extend the expiry of, or to renew or increase the amount of, such Letter
of Credit; and the terms "Issued," "Issuing" and "Issuance" have
corresponding meanings.
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Issuing Lender means BofA in its capacity as issuer of one or more
Letters of Credit hereunder, together with any replacement letter of
credit issuer arising under subsection 11.1(b) or Section 11.9.
Joint Venture means a single-purpose corporation, partnership,
limited liability company, joint venture or other similar legal
arrangement (whether created by contract or conducted through a separate
legal entity) now or hereafter formed by the Company or any of its
Subsidiaries with another Person in order to conduct a common venture or
enterprise with such Person. No Receivables Subsidiary or Special Purpose
Vehicle shall be considered a Joint Venture.
L/C Advance means each Lender's participation in any L/C Borrowing
in accordance with its Revolving Percentage.
L/C Amendment Application means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall
at any time be in use at the Issuing Lender, as the Issuing Lender shall
request.
L/C Application means an application form for issuances of standby
or commercial documentary letters of credit as shall at any time be in use
at the Issuing Lender, as the Issuing Lender shall request.
L/C Borrowing means an extension of credit resulting from a drawing
under any Letter of Credit which shall not have been reimbursed on the
date when made nor converted into a Borrowing of Revolving Loans under
subsection 3.3(c).
L/C Commitment means the commitment of the Issuing Lender to Issue,
and the commitment of the Lenders severally to participate in Letters of
Credit (including the Existing Letters of Credit) from time to time Issued
or outstanding under Article III, in an aggregate amount not to exceed on
any date the amount of $30,000,000, as the same shall be reduced as a
result of a reduction in the L/C Commitment pursuant to Section 2.5;
provided that the L/C Commitment is a part of the combined Commitments,
rather than a separate, independent commitment.
L/C Fee Rate means, at any time, the Applicable Offshore Rate Margin
for Revolving Loans; provided that each of the foregoing rates shall be
increased by 2% at any time an Event of Default exists.
L/C Obligations means, at any time, the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of all unreimbursed drawings under all Letters of Credit, including
all outstanding L/C Borrowings.
L/C-Related Documents means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of
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Credit, including any of the Issuing Lender's standard form documents for
letter of credit issuances.
Lender has the meaning specified in the introductory clause hereto.
References to the "Lenders" shall include BofA, including in its capacity
as Issuing Lender; for purposes of clarification only, to the extent that
BofA may have any rights or obligations in addition to those of the
Lenders due to its status as Issuing Lender, its status as such will be
specifically referenced.
Lending Office means, as to any Lender, the office or offices of
such Lender specified as its "Lending Office" or "Domestic Lending Office"
or "Offshore Lending Office", as the case may be, on Schedule 12.2, or
such other office or offices as such Lender may from time to time notify
the Company and the Agent.
Letters of Credit means the Existing Letters of Credit and any
letters of credit (whether standby letters of credit or commercial
documentary letters of credit) Issued by the Issuing Lender pursuant to
Article III.
Leverage Ratio means, as at any fiscal quarter end for the Company
and its Subsidiaries on a consolidated basis, the ratio of
(i) Adjusted Funded Debt as of such fiscal quarter end
to
(ii) Adjusted EBITDA.
Lien means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance,
lien (statutory or other) or preferential arrangement of any kind or
nature whatsoever in respect of any property (including those created by,
arising under or evidenced by any conditional sale or other title
retention agreement, the interest of a lessor under a capital lease, any
financing lease having substantially the same economic effect as any of
the foregoing, or the filing of any financing statement naming the owner
of the asset to which such lien relates as debtor, under the Uniform
Commercial Code or any comparable law) and any contingent or other
agreement to provide any of the foregoing, but not including the interest
of a lessor under an operating lease.
Loan means an extension of credit by a Lender to the Company under
Article II or Article III in the form of a Revolving Loan, Term Loan or
L/C Advance.
Loan Documents means this Agreement, any Notes, the Fee Letter, the
L/C-Related Documents, the Pledge Agreement, the Subsidiary Pledge
Agreements, the Guaranty, the NEHC Guaranty, the Security Agreement, the
Trademark Security Agreement, the Mortgages, and all other documents
delivered to the Agent or any Lender in connection herewith.
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LTM EBITDA means $94,000,000 for the four fiscal quarter period
ended September 30, 1997, $62,000,000 for the four fiscal quarter period
ended December 31, 1997 and $37,000,000 for the four fiscal quarter period
ended March 31, 1998.
Margin Stock means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of the Company or the
Company and its Subsidiaries taken as a whole; (b) a material impairment
of the ability of the Company, NEHC or any Subsidiary to perform under any
Loan Document and to avoid any Event of Default; or (c) a material adverse
effect upon the legality, validity, binding effect or enforceability
against the Company or any Subsidiary of any Loan Document.
Moody's has been specified in the definition of "Cash Equivalent
Investments".
Mortgage means a mortgage, leasehold mortgage, deed of trust or
similar document granting a Lien on real property in appropriate form for
filing or recording in the applicable jurisdiction and otherwise
reasonably satisfactory to the Administrative Agent.
Mortgaged Property means the real property subject to a Mortgage.
Multiemployer Plan means a "multiemployer plan", within the meaning
of Section 4001(a)(3) of ERISA, to which the Company or any ERISA
Affiliate may have any liability.
NEHC means Nebco Evans Holding Company, a Delaware corporation.
NEHC Guaranty means the guaranty of NEHC in substantially the form
of Exhibit I.
NEHC Pledge Agreement means the Pledge Agreement dated the date
hereof between NEHC and the Administrative Agent.
Net Cash Proceeds means
(a) with respect to the sale, transfer, or other disposition by
the Company or any Subsidiary of any asset (including any
stock of any Subsidiary), the aggregate cash proceeds
(including cash proceeds received by way of deferred payment
of principal pursuant to a note, installment receivable or
otherwise, but only as and when received) received by the
Company or any Subsidiary pursuant to such sale, transfer or
other disposition, net of (i) the direct costs relating to
such sale, transfer or
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other disposition (including, without limitation, sales
commissions and legal, accounting and investment banking
fees), (ii) taxes paid or payable as a result thereof (after
taking into account any available tax credits or deductions
and any tax sharing arrangements), (iii) amounts required to
be applied to the repayment of any Indebtedness secured by a
Lien on the asset subject to such sale, transfer or other
disposition (other than the Loans) and (iv) any reserve for
adjustment in respect of the sale price of such asset (until
such amount is available to the Company or the applicable
Subsidiary); and
(b) with respect to any issuance of equity securities or
Indebtedness, the aggregate cash proceeds received by the
Company or any Subsidiary pursuant to such issuance, net of
the direct costs relating to such issuance (including, without
limitation, sales and underwriter's commissions and legal,
accounting and investment banking fees).
Note means a promissory note executed by the Company in favor of a
Lender pursuant to subsection 2.2(b), in substantially the form of Exhibit
D.
Notice of Borrowing means a notice in substantially the form of
Exhibit A.
Notice of Conversion/Continuation means a notice in substantially
the form of Exhibit B.
Ob1igations means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
or any Subsidiary to any Lender, the Agent, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter
arising.
OECD has the meaning specified in the definition of "Eligible
Assignee".
Offshore Rate means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward to the next 1/16th of 1%) determined by
the Administrative Agent as follows:
Offshore Rate = LIBOR
----------------------------------------------
1.00 - Eurodollar Reserve Percentage
where,
Eurodollar Reserve Percentage means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
(whether or not applicable to any Lender) under regulations issued
from time to time by the FRB for
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determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) with
respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"); and
LIBOR means the rate of interest per annum determined by the Agent
as the rate at which dollar deposits in the approximate amount of
BofA's Offshore Rate Loan for such Interest Period would be offered
by BofA's Grand Cayman Branch, Grand Cayman B.W.I. (or such other
office as may be designated for such purpose by BofA), to major
banks in the offshore dollar interbank market at their request at
approximately 11:00 a.m. (New York City time) two Business Days
prior to the commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to all
Offshore Rate Loans then outstanding as of the effective date of any
change in the Eurodollar Reserve Percentage.
Offshore Rate Loan means a Loan that bears interest based on the
Offshore Rate.
Organization Documents means, for any corporation, the certificate
or articles of incorporation, the bylaws, any certificate of determination
or instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
Other Taxes means any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other
Loan Documents.
Participant has the meaning specified in subsection 12.8(d).
PBGC means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
Pension Plan means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA, other than a Multiemployer Plan, with
respect to which a Company or any ERISA Affiliate may have any liability.
Permitted Indebtedness has the meaning specified in Section 9.5.
Permitted Liens has the meaning specified in Section 9.1.
Person means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
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PFS means PFS, a division of the Seller.
PFS Acquisition means the acquisition of PFS by the Company pursuant
to the PFS Acquisition Agreement.
PFS Acquisition Agreement means the Asset Purchase Agreement between
PepsiCo, Inc. and NEHC dated May 23, 1997.
Plan means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company sponsors or maintains or to which the Company
makes, is making, or is obligated to make contributions and includes any
Pension Plan.
Pledge Agreement means the Amended and Restated Pledge Agreement
dated the date hereof between the Company and the Administrative Agent.
Pooling and Servicing Agreement means the Pooling and Servicing
Agreement dated as of July 1, 1997 among AmeriServe Funding Corporation,
AmeriServe Food Distribution, Inc., and Norwest Bank Minnesota, National
Association, as Trustee, as amended, amended and restated, supplemented or
otherwise modified from time to time.
Post means The Harry H. Post Company, a Colorado corporation.
Post Contribution means the contribution of all the capital stock of
Post to the Company.
Preferred Stock means preferred stock of the Company issued on terms
acceptable to the Required Lenders.
Purchase Money Note means a promissory note evidencing the
obligation of a Receivables Subsidiary to pay all or any portion of the
purchase price for Receivables and other Receivables Program Assets to the
Company or any other Receivables Seller in connection with a Qualified
Receivables Transaction, which note shall be repaid from cash available to
the maker of such note, other than (i) cash required to be held as
reserves pursuant to Receivables Documents, (ii) amounts paid in respect
of interest, principal and (iii) other amounts owing under Receivables
Documents and amounts paid in connection with the purchase of newly
generated Receivables.
Qualified Receivables Transaction means (i) the Receivables Bridge
Facility and (ii) any transaction or series of transactions that may be
entered into by the Company and/or any Subsidiary pursuant to which the
Company and/or any Subsidiary may sell, convey or otherwise transfer to a
Receivables Subsidiary (in the case of a transfer by the Company and/or
any other Receivables Seller) and any other Person (in the case of a
transfer by a Receivables Subsidiary), or may grant a security interest
in, any Receivables Program Assets (whether now existing or arising in the
future); provided that:
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(a) no portion of the indebtedness or any other obligations
(contingent or otherwise) of a Receivables Subsidiary or Special Purpose
Vehicle (i) is guaranteed by the Company or any other Receivables Seller
(excluding guarantees of obligations pursuant to Standard Securitization
Undertakings), (ii) is recourse to or obligates the Company or any other
Receivables Seller in any way other than pursuant to Standard
Securitization Undertakings or (iii) subjects any property or asset of the
Company or any other Receivables Seller, directly or indirectly,
contingently or otherwise, to the satisfaction of obligations incurred in
such transactions, other than pursuant to Standard Securitization
Undertakings;
(b) neither the Company nor any other Receivables Seller has any
material contract, agreement, arrangement or understanding with a
Receivables Subsidiary or a Special Purpose Vehicle (except in connection
with a Purchase Money Note or Qualified Receivables Transaction) other
than on terms no less favorable to the Company or such Receivables Seller
than those that might be obtained at the time from Persons that are not
affiliates of the Company, other than fees payable in the ordinary course
of business in connection with servicing accounts receivable; and
(c) the Company and the other Receivables Sellers do not have any
obligation to maintain or preserve the financial condition of a
Receivables Subsidiary or a Special Purpose Vehicle or cause such entity
to achieve certain levels of operating results.
Receivable Stated Amount means, with respect to a Receivables
Investor Instrument, the maximum amount of the funding commitment with
respect thereto.
Receivables means all rights of the Company or any other Receivables
Seller to payments (whether constituting accounts, chattel paper,
instruments, general intangibles or otherwise) arising from the sale of
goods, services or future services by the Company and/or a Receivables
Seller, and includes the right to payment of any interest or finance
charge and other obligations with respect thereto and any other rights to
payment recorded as a receivable.
Receivables Bridge Facility means the Receivables Documents in
effect at, or becoming effective contemporaneously with, the Closing Date.
Receivables Documents means (x) each and every receivables purchase
agreement, pooling and servicing agreement, series supplement thereto,
certificate purchase agreement, guaranty, Purchase Money Note, license
agreement, sublicense agreement, credit agreement, agreement to acquire
undivided interests or other agreement to transfer, or create a security
interest in, Receivables Program Assets, in each case as amended,
modified, supplemented or amended and restated and in effect from time to
time entered into by the Company, another Receivables Seller and/or a
Receivables Subsidiary, and (y) each other instrument, agreement and other
document entered into by the Company, any other Receivables Seller and/or
a Receivables Subsidiary relating to the transactions contemplated by the
items referred to in clause
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(x) above, in each case as amended, modified, supplemented or amended and
restated and in effect from time to time.
Receivables Financing Costs means any loss attributable to the sale
of Receivables Program Assets.
Receivables Investor Instruments means trust certificates, purchased
interests or any other securities, instruments or agreements evidencing an
interest in the Receivables Program Assets held by a Person other than the
Company and its Subsidiaries (excluding Receivables Subsidiaries).
Receivables Program Assets means (a) all Receivables which are
described as being transferred by the Company, another Receivables Seller
and/or a Receivables Subsidiary pursuant to the Receivables Documents, (b)
all Receivables Related Assets, and (c) all collections (including
recoveries) and other proceeds of the assets described in the foregoing
clauses.
Receivables Program Obligations means (a) notes, trust certificates,
undivided interests, partnership interests or other interests representing
the right to be paid a specified principal amount from the Receivables
Program Assets, and (b) related obligations of the Company, a Subsidiary
and/or a Special Purpose Vehicle (including, without limitation, rights in
respect of interest or yield, breach of warranty claims and expense
reimbursement and indemnity provisions). The Receivables Program
Obligations shall also include Purchase Money Notes and guarantees by the
Company of obligations pursuant to Standard Securitization Undertakings.
Receivables Related Assets means (i) any rights arising under the
documentation governing or relating to Receivables (including rights in
respect of liens securing such Receivables and other credit support in
respect of such Receivables), (ii) any collections and other proceeds of
such Receivables, (iii) any lockboxes or bank accounts, all documents,
instruments and agreements relating to such lockboxes or bank accounts,
and any amounts from time to time deposited therein, (iv) spread accounts,
trust accounts and other similar accounts (and any amounts on deposit
therein) established in connection with a Qualified Receivables
Transaction, (v) any warranty, indemnity, dilution and other intercompany
claim arising out of Receivables Documents and (vi) other assets
(including those contemplated by Receivables Documents) which are
customarily transferred or in respect of which security interests are
customarily granted in connection with asset securitization transactions
involving accounts receivable.
Receivables Seller means the Company and any Subsidiary of the
Company (other than a Receivables Subsidiary) which is a party to a
Receivables Document.
Receivables Subsidiary means a special purpose wholly-owned
subsidiary of the Company created in connection with the transactions
contemplated by a Qualified Receivables Transaction, which subsidiary
engages in no activities other than those
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incidental to such Qualified Receivables Transaction and which is
designated as a Receivables Subsidiary by the Company's Board of
Directors. Any such designation by the Board of Directors shall be
evidenced by filing with the Administrative Agent a certified copy of the
resolution of the Board of Directors of the Company giving effect to such
designation and an officers' certificate certifying, to the best of such
officer's knowledge and belief after consulting with counsel, that such
designation, and the transactions in which the Receivables Subsidiary will
engage, comply with the requirements of the definition of Qualified
Receivables Transaction.
Register has the meaning specified in Section 12.8.
Reportable Event means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such event
for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
Required Lenders means, at any time, Lenders having an aggregate
Total Percentage of 51% or more.
Requirement of Law means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or
of a Governmental Authority, in each case applicable to or binding upon
the Person or any of its property or to which the Person or any of its
property is subject.
Responsible Officer means the chief executive officer or the
president of the Company, or any other officer having substantially the
same authority and responsibility; or, with respect to compliance with
financial covenants, the chief financial officer or the treasurer of the
Company, or any other officer having substantially the same authority and
responsibility.
Restructuring Costs means any cash integration expenditures related
to the AmeriServ Acquisition or the PFS Acquisition incurred by the
Company reflected as (i) a non-operating expense in the Company's income
statement, (ii) a reduction of the restructuring reserve on the Company's
balance sheet, or (iii) restructuring charges taken in the years 1997,
1998, and 1999 to the extent added to Adjusted EBITDA pursuant to clause
(c) of the definition of "Adjusted EBITDA".
Revolving Commitment means, as to any Lender, the commitment of such
Lender to make Revolving Loans pursuant to subsection 2.1(e). The initial
amount of each Lender's Revolving Commitment is set forth on Schedule 2.1.
Revolving Loan has the meaning specified in Section 2.1, and may be
a Base Rate Loan or an Offshore Rate Loan (each a "Type" of Revolving
Loan).
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Revolving Percentage means, as to any Lender, the percentage which
(a) the amount of such Lender's Revolving Commitment is of (b) the
aggregate amount of all of the Lenders' Revolving Commitments.
Revolving Termination Date means the earlier to occur of:
(a) June 30, 2003; and
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
S&P has the meaning specified in the definition of "Cash Equivalent
Investments".
SEC means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
Seller means PepsiCo, Inc., a North Carolina corporation.
Security Agreement means the Amended and Restated Security Agreement
dated the date hereof between the Company, its Subsidiaries and the
Administrative Agent.
Senior Subordinated Notes means the senior subordinated notes due
July 15, 2007 in a principal amount not in excess of $500,000,000, with
subordination provisions no less favorable to the Lenders than the
subordination provisions described in the Preliminary Offering Memorandum
dated June 23, 1997, with an interest rate which will not require cash
interest payments in excess of 12% per annum and with no scheduled
principal payments prior to July 1, 2007.
Special Purpose Vehicle means a trust, partnership or other special
purpose Person established by the Company and/or its Subsidiaries to
implement a Qualified Receivables Transaction.
Standard Securitization Undertakings means representations,
warranties, covenants and indemnities entered into by the Company and/or
any Subsidiary which are reasonably customary in an accounts receivable
transaction.
Subordinated Debt means all unsecured Indebtedness of the Company
for money borrowed which is subordinated, upon terms reasonably
satisfactory to the Required Lenders, in right of payment to the payment
in full in cash of all Obligations.
Subsidiary of a Person means any corporation, association,
partnership, limited liability company, limited liability partnership,
joint venture or other business entity of which more than 50% of the
voting stock, membership interests or other equity
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interests (in the case of Persons other than corporations), is owned or
controlled directly or indirectly by the Person, or one or more of the
Subsidiaries of the Person, or a combination thereof. Unless the context
otherwise clearly requires, references herein to a "Subsidiary" refer to a
Subsidiary of the Company. No Special Purpose Vehicle will be considered a
"Subsidiary".
Subsidiary Pledge Agreement means the Amended and Restated Pledge
Agreement dated the date hereof between AmeriServ Food Company and the
Administrative Agent.
Supermajority Lenders means, at any time, Lenders having an
aggregate Total Percentage of 66-2/3% or more.
Surety Instruments means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, shipside bonds,
surety bonds and similar instruments.
Tax Sharing Agreement means that certain Tax Sharing Agreement
effective as of the first day of the 1989 consolidated return year between
Holberg and the Company as successor by merger to certain former
subsidiaries of the Company.
Taxes means any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, such taxes
(including income taxes or franchise taxes) as are imposed on or measured
by each Lender's net income by the jurisdiction (or any political
subdivision thereof) under the laws of which such Lender or the Agent, as
the case may be, is organized or maintains a lending office.
Term A Commitment means, as to any Lender, the commitment of such
Lender to make a Term A Loan pursuant to subsection 2.1(a). The amount of
each Lender's Term A Commitment is set forth on Schedule 2.1.
Term A Loan - see subsection 2.1(a).
Term A Percentage means, as to any Lender, the percentage which (a)
the Term A Commitment of such Lender (or, after the making of the Term A
Loans, the principal amount of such Lender's Term A Loan) is of (b) the
aggregate amount of Term A Commitments (or after the making of the Term A
Loans, the aggregate principal amount of all Term A Loans). The initial
amount of the Term A Loan Percentage for each Lender is set forth opposite
such Lender's name on Schedule 2.1.
Term B Commitment means, as to any Lender, the commitment of such
Lender to make a Term B Loan pursuant to subsection 2.1(b). The amount of
each Lender's Term B Commitment is set forth opposite such Lender's name
on Schedule 2.1.
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Term B Loan - see subsection 2.1(b).
Term B Percentage means, as to any Lender, the percentage which (a)
the Term B Commitment of such Lender (or, after the making of the Term B
Loans, the principal amount of such Lender's Term B Loan) is of (b) the
aggregate amount of Term B Commitments (or after the making of the Term B
Loans, the aggregate principal amount of all Term B Loans). The initial
amount of the Term B Loan Percentage for each Lender is set forth such
Lender's name on Schedule 2.1.
Term C Commitment means as to any Lender, the commitment of such
Lender to make a Term C Loan pursuant to subsection 2.1(c). The amount of
each Lender's Term C Commitment is set forth opposite such Lender's name
on Schedule 2.1.
Term C Loan - see subsection 2.1(c).
Term C Percentage means, as to any Lender, the percentage which (a)
the Term C Commitment of such Lender (or, after the making of the Term C
Loans, the aggregate amount of such Lender's Term C Loan) is of (b) the
aggregate amount of Term C Commitments (or after the making of the Term C
Loans, the aggregate principal amount of all Term C Loans). The initial
amount of the Term C Loan Percentage for each Lender is set forth opposite
such Lender's name on Schedule 2.1.
Term D Commitment means to any Lender, the commitment of such Lender
to make a Term D Loan pursuant to subsection 2.1(d). The amount of each
Lender's Term D Commitment is set forth in Schedule 2.1.
Term D Loan - see subsection 2.1(d).
Term D Percentage means, as to any Lender, the percentage which (a)
the Term D Commitment of, such Lender (or, after the making of the Term D
Loans, the aggregate amount of such Lender's Term D Loan) is of (a) the
aggregate amount of Term D Commitments (or after the making of the Term D
Loans, the aggregate principal amount of all Term D Loans). The initial
amount of the Term D Loan Percentage for each Lender is set forth opposite
such Lender's name on Schedule 2.1.
Term Loan means a Term A Loan, a Term B Loan, a Term C Loan or a
Term D Loan.
Total Percentage means, as to any Lender the percentage which
(a) the aggregate amount of (i) such Lender's Revolving Commitment plus
(ii) such Lender's Term A Commitment (or, after the making of the Term A
Loans, the outstanding principal amount of such Lender's Term A Loans)
plus (iii) such Lender's Term B Commitment (or, after the making of the
Term B Loans, the outstanding principal amount of such Lender's Term B
Loans) plus, (iv) such Lender's Term C Commitment (or, if after the making
of the Term C Loans, the outstanding principal amount of such Lender's
Term C Loans) plus (v) such Lender's Term D Commitment
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(or if after the making of the Term D Loans, the outstanding principal
amount of such Lender's Term D Loans) is of (b) the aggregate amount of
(i) the Revolving Commitments of all Lenders plus (ii) the Term A
Commitments of all Lenders (or, after the making of the Term A Loans, the
outstanding principal amount of all Term A Loans) plus (iii) the Term B
Commitments of all Lenders (or, after the making of the Term B Loans, the
outstanding principal amount of all Term B Loans), plus (iv) the Term C
Commitments of all Lenders (or, if after the making of the Term C Loans,
the outstanding principal amount of all Term C Loans) plus (v) the Term D
Commitments of all Lenders (or, if after the making of the Term D Loans,
the outstanding principal amount of all Term D Loans); provided that after
the Revolving Commitments have been terminated, "Total Percentage" shall
mean, as to any Lender, the percentage which the aggregate principal
amount of such Lender's Loans is of the aggregate principal amount of all
Loans. The initial Total Percentage for each Lender is set forth opposite
such Lender's name on Schedule 2.1.
Trademark Security Agreement means the Amended and Restated
Trademark Security Agreement dated the date hereof between AmeriServ Food
Company and the Administrative Agent.
Transportation Equipment Sale and Leaseback means the purchase,
sale and leaseback of transportation equipment subject to purchase orders
of PFS on the date hereof.
Type has the meaning specified in the definition of "Revolving
Loan."
UCP has the meaning specified in Section 3.9.
Unfunded Pension Liability means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of
that Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
United States and U.S. each means the United States of America.
Wholly-Owned Subsidiary means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of
each class having ordinary voting power, and 100% of the capital stock of
every other class, in each case, at the time as of which any determination
is being made, is owned, beneficially and of record, by the Company, or by
one or more of the other Wholly-Owned Subsidiaries, or both.
Working Capital means the excess of:
(a) (i) the consolidated current assets of the Company and its
Subsidiaries, less (ii) the amount of cash and cash equivalents included
in such consolidated current assets;
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over
(b) (i) consolidated current liabilities of the Company and its
Subsidiaries less, (ii) the amount of short-term Indebtedness (including
current maturities of long-term Indebtedness) of the Company and its
Subsidiaries included in such consolidated current liabilities.
1.2 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding", and
the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agents, the Company
and the
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other parties, and are the products of all parties. Accordingly, they shall not
be construed against the Lenders or the Agents merely because of the Agents' or
Lenders' involvement in their preparation.
1.3 Accounting Principles.
(a) Unless the context otherwise clearly requires, all accounting
terms not expressly defined herein shall be construed, and all financial
computations required under this Agreement shall be made, in accordance with
GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments. (a) The Term A Credit. Each Lender
severally agrees, on the terms and conditions set forth herein, to make a single
loan to the Company (each such loan, a "Term A Loan") on the Closing Date in an
amount not to exceed such Lender's Term A Percentage of $78,095,238.10. Amounts
borrowed as Term A Loans which are repaid or prepaid by the Company may not be
reborrowed. The Term A Commitments shall expire concurrently with the making of
the Term A Loans on the Closing Date.
(b) The Term B Credit. Each Lender severally agrees, on the terms
and conditions set forth herein, to make a single loan to the Company (each such
loan, a "Term B Loan") on the Closing Date in an amount not to exceed such
Lender's Term B Percentage of $42,301,587.30. Amounts borrowed as Term B Loans
which are repaid or prepaid by the Company may not be reborrowed. The Term B
Commitments shall expire concurrently with the making of the Term B Loans on the
Closing Date.
(c) The Term C Credit. Each Lender severally agrees, on the terms
and conditions set forth herein, to make a single loan to the Company (each such
loan, a "Term C Loan") on the Closing Date in an amount not to exceed such
Lender's Term C Percentage of $42,301,587.30. Amounts borrowed as Term C Loans
which are repaid or prepaid by the Company may not be reborrowed. The Term C
Commitments shall expire concurrently with the making of the Term C Loans on the
Closing Date.
(d) The Term D Credit. Each Lender severally agrees, on the terms
and conditions set forth herein, to make a single loan to the Company (each such
loan, a "Term D Loan") on the Closing Date in an amount not to exceed such
Lender's Term D Percentage of $42,301,587.30. Amounts borrowed as Term D Loans
which are repaid or prepaid by the Company may not be reborrowed. The Term D
Commitments shall expire concurrently with the making of the Term D Loans on the
Closing Date.
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(e) The Revolving Credit. Each Lender severally agrees, on the terms
and conditions set forth herein, to make loans to the Company (each such loan, a
"Revolving Loan"), from time to time on any Business Day during the period from
the Closing Date to the Revolving Termination Date, in an aggregate amount not
to exceed at any time outstanding such Lender's Revolving Percentage of
$150,000,000; provided that, after giving effect to any Borrowing of Revolving
Loans, the aggregate amount of all Revolving Loans plus the Effective Amount of
all L/C Obligations shall not exceed the Revolving Commitments. Within the
foregoing limits, and subject to the other terms and conditions hereof, the
Company may borrow under this subsection 2.1(e), prepay under Section 2.6 and
reborrow under this subsection 2.1(e).
2.2 Loan Accounts. (a) The Loans made by each Lender and the Letters of
Credit Issued by the Issuing Lender shall be evidenced by one or more accounts
or records maintained by such Lender or Issuing Lender, as the case may be, in
the ordinary course of business. The accounts or records maintained by the
Administrative Agent, the Issuing Lender and each Lender shall be rebuttable
presumptive evidence of the amount of the Loans made by the Lenders to the
Company and the Letters of Credit Issued for the account of the Company, and the
interest and payments thereon. Any failure so to record or any error in doing so
shall not, however, limit or otherwise affect the obligation of the Company
hereunder to pay any amount owing with respect to the Loans or any Letter of
Credit.
(b) Upon the request of any Lender made through the Administrative
Agent, the Loans made by such Lender may be evidenced by one or more Notes,
instead of loan accounts. Each such Lender shall endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it and
the amount of each payment of principal made by the Company with respect
thereto. Each such Lender is irrevocably authorized by the Company to endorse
its Note(s) and each Lender's record shall be conclusive absent manifest error;
provided, however, that the failure of a Lender to make, or an error in making,
a notation thereon with respect to any Loan shall not limit or otherwise affect
the obligations of the Company hereunder or under any such Note to such Lender.
2.3 Procedure for Borrowing. (a) Each Borrowing of Revolving Loans or Term
Loans shall be made upon the Company's irrevocable written notice delivered to
the Administrative Agent in the form of a Notice of Borrowing, which notice must
be received by the Administrative Agent (i) prior to 8:30 a.m. (San Francisco
time) three Business Days prior to the requested Borrowing Date, in the case of
Offshore Rate Loans; and (ii) prior to 8:30 a.m. (San Francisco time) on the
requested Borrowing Date, in the case of Base Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in an
aggregate minimum amount of $500,000 and, as to Revolving Loans, a
multiple of $100,000 provided, that if the amount of any unused
Commitment is less than $500,000, then the Company may borrow such
amount in Base Rate Loans;
32
40
(B) the requested Borrowing Date, which shall be a
Business Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to
such Loans included in such notice. If the Notice of Borrowing fails
to specify the duration of the Interest Period for any Borrowing
comprised of Offshore Rate Loans, such Interest Period shall be one
month.
(b) The Administrative Agent will promptly notify each Lender of its
receipt of any Notice of Borrowing and of the amount of such Lender's share of
that Borrowing based upon such Lender's Revolving Percentage, Term A Percentage,
Term B Percentage, Term C Percentage or Term D Percentage as the case may be.
(c) Each Lender will make the amount of its share of each Borrowing
available to the Administrative Agent for the account of the Company at the
Administrative Agent's Payment Office by 11:00 a.m. (San Francisco time) on the
Borrowing Date requested by the Company in funds immediately available to the
Administrative Agent. The proceeds of all such Loans will then be made available
to the Company by the Administrative Agent at such office by crediting the
account of the Company on the books of BofA with the aggregate of the amounts
made available to the Administrative Agent by the Lenders and in like funds as
received by the Administrative Agent or as otherwise set forth in the Notice of
Borrowing.
(d) After giving effect to any Borrowing, there may not be more than
twenty different Interest Periods in effect.
2.4 Conversion and Continuation Elections. (a) The Company may, upon
irrevocable written notice to the Administrative Agent in accordance with
subsection 2.4(b):
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the
case of any other Type of Loans, to convert any such Loans (or any part
thereof in an amount not less than $500,000, or, in the case of Revolving
Loans, that is in an integral multiple of $100,000 in excess thereof) into
Loans of any other Type; or
(ii) elect as of the last day of the applicable Interest
Period, to continue any Loans having Interest Periods expiring on such day
(or any part thereof in an amount not less than $500,000, or, in the case
of Revolving Loans, that is in an integral multiple of $100,000 in excess
thereof);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $500,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Company to continue such Loans as, and convert such Loans into, Offshore
Rate Loans shall terminate.
33
41
(b) The Company shall deliver a Notice of Conversion/Continuation to
be received by the Administrative Agent (i) not later than 8:30 a.m. (San
Francisco time) at least three Business Days in advance of the
Conversion/Continuation Date, if the Loans are to be converted into or continued
as Offshore Rate Loans; and (ii) not later than 8:30 a.m. (San Francisco time)
on the Conversion/Continuation Date, if the Loans are to be converted into Base
Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
renewed;
(C) the Type of Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Company has failed to timely select a new Interest
Period to be applicable to such Offshore Rate Loans, or if any Default or Event
of Default then exists, the Company shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Administrative Agent will promptly notify each Lender of its
receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Company, the Administrative Agent will promptly notify each
Lender of the details of any automatic conversion. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Loans with respect to which the notice was given held
by each Lender.
(e) Unless the Required Lenders otherwise agree, during the
existence of a Default or Event of Default, the Company may not elect to have a
Loan converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
there may not be more than twenty different Interest Periods in effect.
2.5 Voluntary Termination or Reduction of Commitments. The Company may,
upon not less than five Business Days' prior notice to the Administrative Agent,
terminate the Revolving Commitments, or permanently reduce the Revolving
Commitments by an aggregate minimum amount of $5,000,000 or any multiple of
$100,000 in excess thereof; unless, after giving effect thereto and to any
prepayments of Revolving Loans made on the effective date thereof, (a) the
Effective Amount of all Revolving Loans, and L/C Obligations together would
exceed the amount of the Revolving Commitments then in effect, or (b) the
Effective Amount of all L/C Obligations then outstanding would exceed the L/C
Commitment. Once reduced in accordance with this Section, the Revolving
Commitments
34
42
may not be increased. Any reduction of the Revolving Commitments shall be
applied to each Lender according to its Revolving Percentage. If and to the
extent specified by the Company in the notice to the Administrative Agent, some
or all of the reduction in the combined Revolving Commitments shall be applied
to reduce the L/C Commitment. All accrued commitment and letter of credit fees
to, but not including, the effective date of any reduction or termination of
Commitments, shall be paid on the effective date of such reduction or
termination.
2.6 Optional Prepayments. (a) Subject to Section 4.4, (i) the Company may,
from time to time, upon irrevocable written notice to the Administrative Agent
(which notice must be received by 8:30 a.m. (San Francisco time) on the day of
prepayment in the case of Base Rate Loans and 8:30 a.m. (San Francisco time) two
Business Days prior to the date of prepayment in the case of Offshore Rate
Loans), ratably prepay any Borrowing of Revolving Loans in whole or in part, in
an aggregate amount of $500,000 or a higher integral multiple of $100,000; and
(ii) the Company may, from time to time, upon not less than five Business Days'
irrevocable notice to the Administrative Agent, prepay any Borrowing of Term
Loans in whole or in part, in an aggregate amount of $1,000,000 or a higher
integral multiple of $100,000.
(b) Each notice of prepayment shall specify the date and amount of
such prepayment and the Loans to be prepaid. The Administrative Agent will
promptly notify each Lender of its receipt of any such notice and of such
Lender's share of such prepayment based upon such Lender's Revolving Percentage,
in the case of a prepayment of Revolving Loans, Term A Percentage, in the case
of a prepayment of Term A Loans, Term B Percentage in the case of a prepayment
of Term B Loans, Term C Percentage in the case of prepayment of Term C Loans and
Term D Percentage in the case of prepayment of Term D Loans. If any such notice
is given by the Company, the Company shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein, together with accrued interest to such date on the amount prepaid and
any amounts required pursuant to Section 4.4. Each prepayment of Revolving Loans
shall be applied to each Lender's Revolving Loans according to such Lender's
Revolving Percentage. Each prepayment of Term Loans shall be applied pro rata to
the Term Loans and as to any Term Loan, shall be applied to its unpaid
installments pro rata; provided that the Company may offer Lenders holding Term
B Loans, Term C Loans or Term D Loans the right to waive such prepayment. If any
Lender so elects, by notice to the Administrative Agent and the Company not
later than three Business Days after the date such notice is given, the portion
of any prepayment which would have been applied to such Lender's Term B Loans,
Term C Loans or Term D Loans, as applicable, shall be applied pro rata to the
remaining installments of the Term A Loans of all Lenders.
2.7 Mandatory Prepayments of Loans; Mandatory Commitment Reductions.
(a) If on any date the Effective Amount of L/C Obligations exceeds
the L/C Commitment, the Company shall Cash Collateralize on such date the
outstanding Letters of Credit in an amount equal to the excess of the maximum
amount then available to be drawn under the Letters of Credit over the Aggregate
L/C Commitment.
35
43
(b) Subject to Section 4.4, if on any date after giving effect to
any Cash Collateralization made on such date pursuant to the preceding sentence,
the Effective Amount of all Revolving Loans then outstanding plus the Effective
Amount of all L/C Obligations exceeds the Revolving Commitments, the Company
shall immediately, and without notice or demand, prepay the outstanding
principal amount of the Revolving Loans and L/C Advances by an amount equal to
the applicable excess.
(c) The Company (or, in the case of subsection (ii), if the
Administrative Agent is holding the proceeds of insurance as additional
Collateral pursuant to the terms of the Security Agreement, the Administrative
Agent upon the Company's instruction) shall make a prepayment of the Loans at
the following times and in the following amounts:
(i) Within 60 days after any sale, transfer or other disposition by
the Company or any Subsidiary of any asset outside the ordinary course of
its business (other than sales of Receivables Program Assets to the extent
the Invested Amount does not exceed $275,000,000 at any time outstanding,
the sale and leaseback of the Grand Rapids, Michigan distribution center
at any time prior to March 31, 1998 and sales in an amount not in excess
of $10,000,000 prior to January 11, 1998 in connection with the
Transportation Equipment Sale and Leaseback) and to a Person other than
the Company or a Subsidiary, in an amount equal to 100% of the Net Cash
Proceeds of such sale, transfer or other disposition to the extent the
aggregate of such Net Cash Proceeds from any such sale, transfer or
disposition exceeds $3,000,000 or from all such sales, transfers or
dispositions received after the date hereof exceeds $10,000,000.
(ii) Within 60 days after the receipt of any insurance proceeds (or
other similar recoveries) by the Company or any Subsidiary or by the
Administrative Agent (to the extent the Administrative Agent is holding
the insurance proceeds as additional Collateral pursuant to Section 6 of
the Security Agreement) from any casualty loss incurred by the Company or
any Subsidiary, in an amount equal to 100% of such insurance proceeds (or
other similar recoveries) net of any collection expenses; provided that no
such prepayment shall be required to the extent such proceeds are or,
within one year, will be used by the Company for the financing of the
replacement, substitution or restoration of the assets sustaining such
casualty loss.
(iii) Concurrently with the receipt of any Net Cash Proceeds from
any issuance of Indebtedness of the Company or any of its Subsidiaries
(other than Permitted Indebtedness), in an amount equal to 100% of such
Net Cash Proceeds.
(iv) Concurrently with the receipt of any Net Cash Proceeds from any
issuance of equity securities of the Company or any Subsidiary (including
a Public Offering, but excluding the issuance of shares of common stock of
the Company pursuant to any employee, officer or director stock option
program, benefit plan or compensation program), in an amount equal to 50%
of such Net Cash Proceeds.
(v) Within 90 days after the end of each fiscal year, in an amount
equal to 75 % (or after the aggregate principal amount of the Term Loans
is less than
36
44
$157,500,000, 50%) of Excess Cash Flow for such fiscal year (rounded to
the nearest, or if there is no nearest the next highest, integral multiple
of $10,000).
All prepayments of Loans pursuant to this Section 2.7 shall be applied ratably
to the Term A Loans, the Term B Loans, the Term C Loans and the Term D Loans.
The prepayment of any Term Loan pursuant to this Section 2.7(c) shall be applied
to its installments pro rata except that any prepayment pursuant to clause (iii)
shall be applied to the installments of any Term Loan in the inverse order of
their maturities; provided that the Company may offer Lenders holding Term B
Loans, Term C Loans or Term D Loans the right to waive such mandatory
prepayment. If any such Lender so elects, by notice to the Administrative Agent
and the Company not later than five Business Days after such notice is given,
50% of the portion of any prepayment which would have been applied to such
Lender's Term B Loans, Term C Loans or Term D Loans shall be applied pro rata to
the remaining installments of the Term A Loans of all Lenders (except that any
prepayment pursuant to clause (iii) shall be applied to such installments in the
inverse order of their maturities) and the remaining portion of such prepayment
shall be retained by the Company. Once all of the Term Loans have been paid in
full (or the Term A Loans have been paid in full and the Lenders holding Term B
Loans, Term C Loans or Term D Loans have declined such prepayment), any
prepayment pursuant to this Section 2.7 shall be applied to the Revolving Loans;
and the Revolving Loan Commitments shall be correspondingly reduced.
2.8 Repayment. (a) The Term A Credit. Subject to Sections 2.6 and 2.7, the
Company shall repay the Term A Loans in quarterly installments on the last day
of each calendar quarter, commencing on September 30, 1998 in the amount set
forth opposite the following dates:
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
09/30/98 $ 813,492.06
--------------------------------------------------------------------
12/31/98 $ 813,492.06
--------------------------------------------------------------------
03/31/99 $ 813,492.06
--------------------------------------------------------------------
06/30/99 $ 813,492.06
--------------------------------------------------------------------
09/30/99 $4,067,460.32
--------------------------------------------------------------------
12/31/99 $4,067,460.32
--------------------------------------------------------------------
03/31/00 $4,067,460.32
--------------------------------------------------------------------
06/30/00 $4,067,460.32
--------------------------------------------------------------------
09/30/00 $4,880,952.38
--------------------------------------------------------------------
12/31/00 $4,880,952.38
--------------------------------------------------------------------
03/31/01 $4,880,952.38
--------------------------------------------------------------------
37
45
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
06/30/01 $4,880,952.38
--------------------------------------------------------------------
09/30/01 $4,880,952.38
--------------------------------------------------------------------
12/31/01 $4,880,952.38
--------------------------------------------------------------------
03/31/02 $4,880,952.38
--------------------------------------------------------------------
06/30/02 $4,880,952.38
--------------------------------------------------------------------
09/30/02 $4,880,952.38
--------------------------------------------------------------------
12/31/02 $4,880,952.38
--------------------------------------------------------------------
03/31/03 $4,880,952.38
--------------------------------------------------------------------
06/30/03 $4,880,952.38
--------------------------------------------------------------------
(b) The Term B Credit. Subject to Sections 2.6 and 2.7, the Company
shall repay the Term B Loans in quarterly installments on the last day of each
calendar quarter, commencing on September 30, 1998 in the amount set forth
opposite the following dates:
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
09/30/98 $ 105,753.97
--------------------------------------------------------------------
12/31/98 $ 105,753.97
--------------------------------------------------------------------
03/31/99 $ 105,753.97
--------------------------------------------------------------------
06/30/99 $ 105,753.97
--------------------------------------------------------------------
09/30/99 $ 105,753.97
--------------------------------------------------------------------
12/31/99 $ 105,753.97
--------------------------------------------------------------------
03/31/00 $ 105,753.97
--------------------------------------------------------------------
06/30/00 $ 105,753.97
--------------------------------------------------------------------
09/30/00 $ 105,753.97
--------------------------------------------------------------------
12/31/00 $ 105,753.97
--------------------------------------------------------------------
03/31/01 $ 105,753.97
--------------------------------------------------------------------
06/30/01 $ 105,753.97
--------------------------------------------------------------------
09/30/01 $ 105,753.97
--------------------------------------------------------------------
38
46
--------------------------------------------------------------------
12/31/01 $ 105,753.97
--------------------------------------------------------------------
03/31/02 $ 105,753.97
--------------------------------------------------------------------
06/30/02 $ 105,753.97
--------------------------------------------------------------------
09/30/02 $ 105,753.97
--------------------------------------------------------------------
12/31/02 $ 105,753.97
--------------------------------------------------------------------
03/31/03 $ 105,753.97
--------------------------------------------------------------------
06/30/03 $ 105,753.97
--------------------------------------------------------------------
09/30/03 $10,046,626.98
--------------------------------------------------------------------
12/31/03 $10,046,626.98
--------------------------------------------------------------------
03/31/04 $10,046,626.98
--------------------------------------------------------------------
06/30/04 $10,046,626.98
--------------------------------------------------------------------
(c) The Term C Credit. Subject to Sections 2.6 and 2.7, the Company
shall repay the Term C Loans in quarterly installments on the last day of each
calendar quarter commencing September 30, 1998 in the amount set forth opposite
the following dates;
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
09/30/98 $ 105,753.97
--------------------------------------------------------------------
12/31/98 $ 105,753.97
--------------------------------------------------------------------
03/31/99 $ 105,753.97
--------------------------------------------------------------------
06/30/99 $ 105,753.97
--------------------------------------------------------------------
09/30/99 $ 105,753.97
--------------------------------------------------------------------
12/31/99 $ 105,753.97
--------------------------------------------------------------------
03/31/00 $ 105,753.97
--------------------------------------------------------------------
06/30/00 $ 105,753.97
--------------------------------------------------------------------
09/30/00 $ 105,753.97
--------------------------------------------------------------------
12/31/00 $ 105,753.97
--------------------------------------------------------------------
03/31/01 $ 105,753.97
--------------------------------------------------------------------
06/30/01 $ 105,753.97
--------------------------------------------------------------------
39
47
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
09/30/01 $ 105,753.97
--------------------------------------------------------------------
12/31/01 $ 105,753.97
--------------------------------------------------------------------
03/31/02 $ 105,753.97
--------------------------------------------------------------------
06/30/02 $ 105,753.97
--------------------------------------------------------------------
09/30/02 $ 105,753.97
--------------------------------------------------------------------
12/31/02 $ 105,753.97
--------------------------------------------------------------------
03/31/03 $ 105,753.97
--------------------------------------------------------------------
06/30/03 $ 105,753.97
--------------------------------------------------------------------
09/30/03 $ 105,753.97
--------------------------------------------------------------------
12/31/03 $ 105,753.97
--------------------------------------------------------------------
03/31/04 $ 105,753.97
--------------------------------------------------------------------
06/30/04 $ 105,753.97
--------------------------------------------------------------------
09/30/04 $ 9,940,873.02
--------------------------------------------------------------------
12/31/04 $ 9,940,873.02
--------------------------------------------------------------------
03/31/05 $ 9,940,873.02
--------------------------------------------------------------------
06/30/05 $ 9,940,873.02
--------------------------------------------------------------------
(d) The Term D Credit. Subject to Sections 2.6 and 2.7, the Company
shall repay the Term D Loans in quarterly installments on the last day of each
calendar quarter, commencing on September 30, 1998 in the amount set forth
opposite the following dates;
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
09/30/98 $ 105,753.97
--------------------------------------------------------------------
12/31/98 $ 105,753.97
--------------------------------------------------------------------
03/31/99 $ 105,753.97
--------------------------------------------------------------------
06/30/99 $ 105,753.97
--------------------------------------------------------------------
09/30/99 $ 105,753.97
--------------------------------------------------------------------
12/31/99 $ 105,753.97
--------------------------------------------------------------------
40
48
--------------------------------------------------------------------
Date Amount
--------------------------------------------------------------------
03/31/00 $ 105,753.97
--------------------------------------------------------------------
06/30/00 $ 105,753.97
--------------------------------------------------------------------
09/30/00 $ 105,753.97
--------------------------------------------------------------------
12/31/00 $ 105,753.97
--------------------------------------------------------------------
03/31/01 $ 105,753.97
--------------------------------------------------------------------
06/30/01 $ 105,753.97
--------------------------------------------------------------------
09/30/01 $ 105,753.97
--------------------------------------------------------------------
12/31/01 $ 105,753.97
--------------------------------------------------------------------
03/31/02 $ 105,753.97
--------------------------------------------------------------------
06/30/02 $ 105,753.97
--------------------------------------------------------------------
09/30/02 $ 105,753.97
--------------------------------------------------------------------
12/31/02 $ 105,753.97
--------------------------------------------------------------------
03/31/03 $ 105,753.97
--------------------------------------------------------------------
06/30/03 $ 105,753.97
--------------------------------------------------------------------
09/30/03 $ 105,753.97
--------------------------------------------------------------------
12/31/03 $ 105,753.97
--------------------------------------------------------------------
03/31/04 $ 105,753.97
--------------------------------------------------------------------
06/30/04 $ 105,753.97
--------------------------------------------------------------------
09/30/04 $ 105,753.97
--------------------------------------------------------------------
12/31/04 $ 105,753.97
--------------------------------------------------------------------
03/31/05 $ 105,753.97
--------------------------------------------------------------------
06/30/05 $ 105,753.97
--------------------------------------------------------------------
09/30/05 $ 9,835,119.05
--------------------------------------------------------------------
12/31/05 $ 9,835,119.05
--------------------------------------------------------------------
03/31/06 $ 9,835,119.05
--------------------------------------------------------------------
06/30/06 $ 9,835,119.05
--------------------------------------------------------------------
41
49
(e) The Revolving Credit. The Company shall pay to the
Administrative Agent, for the account of the Lenders, on the Revolving
Termination Date the aggregate principal amount of all Revolving Loans
outstanding on such date.
2.9 Interest. (a) Each Revolving Loan and Term Loan shall bear interest on
the outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to the Offshore Rate or the Base Rate, as the case may be
(and subject to the Company's right to convert to other Types of Loans under
Section 2.4), plus the Applicable Offshore Rate Margin or Applicable Base Rate
Margin, as the case may be.
(b) Interest on each Revolving Loan and Term Loan shall be paid in
arrears on each Interest Payment Date. Interest shall also be paid on the date
of any prepayment of Loans under Section 2.6 or 2.7 for the portion of the Loans
so prepaid and upon payment (including prepayment) in full thereof and, during
the existence of any Event of Default, interest shall be paid on demand of the
Agent at the request or with the consent of the Required Lenders.
(c) Notwithstanding subsection (a) of this Section, while any Event
of Default exists or after acceleration, the Company shall pay interest (after
as well as before entry of judgment thereon to the extent permitted by law) on
the principal amount of all outstanding Loans, at a rate per annum which is
determined by adding 2% per annum to the Applicable Base Rate Margin or
Applicable Offshore Rate Margin then in effect for such Loans; provided,
however, that, on and after the expiration of any Interest Period applicable to
any Offshore Rate Loan outstanding on the date of occurrence of such Event of
Default or acceleration, the principal amount of such Loan shall, during the
continuation of such Event of Default or after acceleration, bear interest at a
rate per annum equal to the Base Rate plus the Applicable Base Rate Margin then
in effect plus 2%.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Lender hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Lender would be contrary to the provisions of
any law applicable to such Lender limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Lender, and in such
event the Company shall pay such Lender interest at the highest rate permitted
by applicable law.
2.10 Fees. In addition to certain fees described in Section 3.8:
(a) Arrangement, Agency Fees. The Company shall pay to the Agents
for each Agent's own account and the Arranger's own account, the fees as
required by the letter agreement ("Fee Letter") between the Company and the
Arranger and Agents dated June 11, 1997, as amended.
(b) Commitment Fees. The Company shall pay to the Administrative
Agent for the account of each Lender a commitment fee equal to the applicable
Commitment Fee Rate times the average daily unused portion of such Lender's
Revolving Commitment, computed
42
50
on a quarterly basis in arrears on the last Business Day of each calendar
quarter. For purposes of calculating utilization under this subsection, the
Commitments shall be deemed used to the extent of the Effective Amount of
Revolving Loans then outstanding, plus the Effective Amount of L/C Obligations
then outstanding. Such commitment fee shall accrue from the Closing Date to the
Revolving Termination Date and shall be due and payable quarterly in arrears on
the last Business Day of each fiscal quarter commencing on the first such date
after the date hereof through the Revolving Termination Date, with the final
payment to be made on the Revolving Termination Date; provided that, in
connection with any reduction or termination of Commitments under Section 2.5 or
Section 2.7, the accrued commitment fee calculated for the period ending on such
date shall also be paid on the date of such reduction or termination, with the
following quarterly payment being calculated on the basis of the period from
such reduction or termination date to such quarterly payment date. The
commitment fees provided in this subsection shall accrue at all times after the
above-mentioned commencement date, including at any time during which one or
more conditions in Article VI are not met.
2.11 Computation of Fees and Interest. (a) All computations of interest
for Base Rate Loans when the Base Rate is determined by BofA's "reference rate"
shall be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed. All other computations of fees and interest shall be made
on the basis of a 360-day year and actual days elapsed (which results in more
interest being paid than if computed on the basis of a 365-day year). Interest
and fees shall accrue during each period during which interest or such fees are
computed from the first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Administrative
Agent shall be conclusive and binding on the Company and the Lenders in the
absence of manifest error.
2.12 Payments by the Company. (a) All payments to be made by the Company
shall be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Company shall be made to the
Administrative Agent for the account of the Lenders at the Administrative
Agent's Payment Office, and shall be made in dollars and in immediately
available funds, no later than 11:00 a.m. (San Francisco time) on the date
specified herein. The Administrative Agent will promptly distribute to each
Lender its Revolving Percentage of any portion of such payment related to the
Revolving Loans, its Term A Percentage of any portion of such payment relating
to the Term Loans, its Term B Percentage of any portion of such payment relating
to the Term B Loans, its Term C Percentage of any portion of such payment
relating to the Term C Loan and its Term D Percentage of any portion of such
payment relating to the Term D Loan. Any payment received by the Administrative
Agent later than 2:00 p.m. (San Francisco time) shall be deemed to have been
received on the following Business Day and any applicable interest or fee shall
continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
43
51
(c) Unless the Administrative Agent receives notice from the Company
prior to the date on which any payment is due to the Lenders that the Company
will not make such payment in full as and when required, the Administrative
Agent may assume that the Company has made such payment in full to the
Administrative Agent on such date in immediately available funds and the
Administrative Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Company has not made such
payment in full to the Administrative Agent, each Lender shall repay to the
Administrative Agent on demand such amount distributed to such Lender, together
with interest thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Lender until the date repaid.
2.13 Payments by the Lenders to the Administrative Agent. (a) Unless the
Administrative Agent receives notice from a Lender on or prior to the Closing
Date or, with respect to any Borrowing after the Closing Date, at least one
Business Day prior to the date of such Borrowing, that such Lender will not make
available as and when required hereunder to the Administrative Agent for the
account of the Company the amount of that Lender's Revolving Percentage, Term A
Percentage, Term B Percentage, Term C Percentage or Term D Percentage as
applicable, the Administrative Agent may assume that each Lender has made such
amount available to the Administrative Agent in immediately available funds on
the Borrowing Date and the Administrative Agent may (but shall not be so
required), in reliance upon such assumption, make available to the Company on
such date a corresponding amount. If and to the extent any Lender shall not have
made its full amount available to the Administrative Agent in immediately
available funds and the Administrative Agent in such circumstances has made
available to the Company such amount, that Lender shall on the Business Day
following such Borrowing Date make such amount available to the Administrative
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Administrative Agent submitted to any Lender with
respect to amounts owing under this subsection (a) shall be conclusive, absent
manifest error. If such amount is so made available, such payment to the
Administrative Agent shall constitute such Lender's Loan on the date of
Borrowing for all purposes of this Agreement. If such amount is not made
available to the Administrative Agent on the Business Day following the
Borrowing Date, the Administrative Agent will notify the Company of such failure
to fund and, upon demand by the Administrative Agent, the Company shall pay such
amount to the Administrative Agent for the Administrative Agent's account,
together with interest thereon for each day elapsed since the date of such
Borrowing, at a rate per annum equal to the interest rate applicable at the time
to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date
shall not relieve any other Lender of any obligation hereunder to make a Loan on
such Borrowing Date, but no Lender shall be responsible for the failure of any
other Lender to make the Loan to be made by such other Lender on any Borrowing
Date.
2.14 Sharing of Payments, etc. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share of such payment
(determined in accordance with the provisions of this Agreement),
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such Lender shall immediately (a) notify the Administrative Agent of such fact,
and (b) purchase from the other Lenders such participations in the Loans made by
them as shall be necessary to cause such purchasing Lender to share the excess
payment pro rata with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from the purchasing
Lender, such purchase shall to that extent be rescinded and each other Lender
shall repay to the purchasing Lender the purchase price paid therefor, together
with an amount equal to such paying Lender's ratable share (according to the
proportion of (i) the amount of such paying Lender's required repayment to (ii)
the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Company agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 12.10 hereof) with respect to such participation as fully as if such
Lender were the direct creditor of the Company in the amount of such
participation. The Administrative Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Lenders following
any such purchases or repayments.
ARTICLE III
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacility. (a) On the terms and conditions set
forth herein (i) the Issuing Lender agrees, (A) from time to time on any
Business Day during the period from the Closing Date to the Revolving
Termination Date to issue Letters of Credit for the account of the Company, and
to amend or renew Letters of Credit previously issued by it, in accordance with
subsections 3.2(c) and 3.2(d), and (B) to honor drafts under the Letters of
Credit; and (ii) the Lenders severally agree to participate in Letters of Credit
Issued for the account of the Company; provided, that the Issuing Lender shall
not be obligated to Issue, and no Lender shall be obligated to participate in,
any Letter of Credit if as of the date of Issuance of such Letter of Credit (the
"Issuance Date") (1) the Effective Amount of all L/C Obligations plus the
Effective Amount of all Revolving Loans exceeds the combined Revolving
Commitments, (2) the participation of any Lender in the Effective Amount of all
L/C Obligations plus the Effective Amount of the Revolving Loans of such Lender
exceeds such Lender's Revolving Commitment, or (3) the Effective Amount of L/C
Obligations exceeds the L/C Commitment. Within the foregoing limits, and subject
to the other terms and conditions hereof, the Company's ability to obtain
Letters of Credit shall be fully revolving, and, accordingly, the Company may,
during the foregoing period, obtain Letters of Credit to replace Letters of
Credit which have expired or which have been drawn upon and reimbursed.
(b) The Issuing Lender is under no obligation to Issue any Letter of
Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain
the Issuing Lender from
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Issuing such Letter of Credit, or any Requirement of Law applicable to the
Issuing Lender or any request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over the
Issuing Lender shall prohibit, or request that the Issuing Lender refrain
from, the Issuance of letters of credit generally or such Letter of Credit
in particular or shall impose upon the Issuing Lender with respect to such
Letter of Credit any restriction, reserve or capital requirement (for
which the Issuing Lender is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon the Issuing Lender any
unreimbursed loss, cost or expense which was not applicable on the Closing
Date and which the Issuing Lender in good faith deems material to it;
(ii) the Issuing Lender has received written notice from any
Lender, the Administrative Agent or the Company, on or prior to the
Business Day prior to the requested date of Issuance of such Letter of
Credit, that one or more of the applicable conditions contained in Article
VI is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (A)
more than 365 days after the date of Issuance, unless the Required Lenders
have approved such expiry date in writing, or (B) after the Revolving
Termination Date, unless all of the Lenders have approved such expiry date
in writing;
(iv) the expiry date of any requested Letter of Credit is
prior to the maturity date of any financial obligation to be supported by
the requested Letter of Credit;
(v) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance acceptable to the
Issuing Lender, or the Issuance of a Letter of Credit shall violate any
applicable policies of the Issuing Lender;
(vi) any standby Letter of Credit is for the purpose of
supporting the issuance of any letter of credit by any other Person,
except the Letter of Credit dated January 25, 1996 for the benefit of
Provident Bank in the amount of $516,750;
(vii) such Letter of Credit is in a face amount less than
$25,000 or denominated in a currency other than Dollars; or
(viii) it is not a standby letter of credit.
3.2 Issuance, Amendment and Renewal of Letters of Credit. (a) Each Letter
of Credit shall be issued upon the irrevocable written request of the Company
received by the Issuing Lender (with a copy sent by the Company to the
Administrative Agent) at least four days (or such shorter time as the Issuing
Lender may agree in a particular instance in its sole discretion) prior to the
proposed date of issuance. Each such request for issuance of a Letter of Credit
shall be by facsimile, confirmed immediately in an original writing, in the form
of an L/C Application, and shall specify in form and detail satisfactory to the
Issuing Lender: (i) the proposed date of issuance of the Letter of Credit (which
shall be a Business Day); (ii) the face amount of the Letter of Credit; (iii)
the expiry date of the Letter of Credit; (iv) the
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name and address of the beneficiary thereof; (v) the documents to be presented
by the beneficiary of the Letter of Credit in case of any drawing thereunder;
(vi) the full text of any certificate to be presented by the beneficiary in case
of any drawing thereunder; and (vii) such other matters as the Issuing Lender
may require.
(b) At least two Business Days prior to the Issuance of any Letter
of Credit, the Issuing Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
the L/C Application or L/C Amendment Application from the Company and, if not,
the Issuing Lender will provide the Administrative Agent with a copy thereof.
Unless the Issuing Lender has received notice on or before the Business Day
immediately preceding the date the Issuing Lender is to issue a requested Letter
of Credit from the Administrative Agent (A) directing the Issuing Lender not to
issue such Letter of Credit because such issuance is not then permitted under
subsection 3.1(a) as a result of the limitations set forth in clauses (1)
through (3) thereof or subsection 3.1(b)(ii); or (B) that one or more conditions
specified in Article VI are not then satisfied; then, subject to the terms and
conditions hereof, the Issuing Lender shall, on the requested date, issue a
Letter of Credit for the account of the Company in accordance with the Issuing
Lender's usual and customary business practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Lender will, upon the
written request of the Company received by the Issuing Lender (with a copy sent
by the Company to the Administrative Agent) at least five days (or such shorter
time as the Issuing Lender may agree in a particular instance in its sole
discretion) prior to the proposed date of amendment, amend any Letter of Credit
issued by it. Each such request for amendment of a Letter of Credit shall be
made by facsimile, confirmed immediately in an original writing, made in the
form of an L/C Amendment Application and shall specify in form and detail
satisfactory to the Issuing Lender: (i) the Letter of Credit to be amended; (ii)
the proposed date of amendment of the Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such other
matters as the Issuing Lender may require. The Issuing Lender shall be under no
obligation to amend any Letter of Credit if: (A) the Issuing Lender would have
no obligation at such time to issue such Letter of Credit in its amended form
under the terms of this Agreement; or (B) the beneficiary of any such Letter of
Credit does not accept the proposed amendment to the Letter of Credit. No Lender
shall be obligated to participate in any amended Letter of Credit if such Lender
would have no obligation at such time to participate in such Letter of Credit in
its amended form under the terms of this Agreement if such Letter of Credit were
newly issued pursuant to Section 3.1. The Administrative Agent will promptly
notify the Lenders of the receipt by it of any L/C Application or L/C Amendment
Application.
(d) The Issuing Lender and the Lenders agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, at the option
of the Company and upon the written request of the Company received by the
Issuing Lender (with a copy sent by the Company to the Administrative Agent) at
least five days (or such shorter time as the Issuing Lender may agree in a
particular instance in its sole discretion) prior to the proposed date of
notification of renewal, the Issuing Lender shall be entitled to authorize the
automatic renewal of any Letter of Credit issued by it. Each such request for
renewal of a
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Letter of Credit shall be made by facsimile, confirmed immediately in an
original writing, in the form of an L/C Amendment Application, and shall specify
in form and detail satisfactory to the Issuing Lender: (i) the Letter of Credit
to be renewed; (ii) the proposed date of notification of renewal of the Letter
of Credit (which shall be a Business Day); (iii) the revised expiry date of the
Letter of Credit; and (iv) such other matters as the Issuing Lender may require.
The Issuing Lender shall be under no obligation so to renew any Letter of Credit
if: (A) the Issuing Lender would have no obligation at such time to issue or
amend such Letter of Credit in its renewed form under the terms of this
Agreement; or (B) the beneficiary of any such Letter of Credit does not accept
the proposed renewal of the Letter of Credit. No Lender shall be obligated to
participate in any renewal of any Letter of Credit if such Lender would have no
obligation at such time to participate in such Letter of Credit in its renewed
form under the terms of this Agreement if such Letter of Credit were newly
issued pursuant to Section 3.1. If any outstanding Letter of Credit shall
provide that it shall be automatically renewed unless the beneficiary thereof
receives notice from the Issuing Lender that such Letter of Credit shall not be
renewed, and if at the time of renewal the Issuing Lender would be entitled to
authorize the automatic renewal of such Letter of Credit in accordance with this
subsection 3.2(d) upon the request of the Company but the Issuing Lender shall
not have received any L/C Amendment Application from the Company with respect to
such renewal or other written direction by the Company with respect thereto, the
Issuing Lender shall nonetheless be permitted to allow such Letter of Credit to
renew, and the Company and the Lenders hereby authorize such renewal, and,
accordingly, the Issuing Lender shall be deemed to have received an L/C
Amendment Application from the Company requesting such renewal.
(e) The Issuing Lender may, at its election (or as required by the
Administrative Agent at the direction of the Required Lenders), deliver any
notices of termination or other communications to any Letter of Credit
beneficiary or transferee, and take any other action as necessary or
appropriate, at any time and from time to time, in order to cause the expiry
date of such Letter of Credit to be a date not later than the Revolving
Termination Date.
(f) This Agreement shall control in the event of any conflict with
any L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Lender will also deliver to the Administrative
Agent, concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or amendment
to or renewal of a Letter of Credit.
3.3 Existing Letters of Credit; Risk Participations, Drawings and
Reimbursements. (a) On and after the Closing Date, the Existing Letters of
Credit shall be deemed for all purposes, including for purposes of the fees to
be collected pursuant to subsections 3.8(a) and 3.8(c), and reimbursement of
costs and expenses to the extent provided herein, Letters of Credit outstanding
under this Agreement and entitled to the benefits of this Agreement and the
other Loan Documents, and shall be governed by the applications and agreements
pertaining thereto and by this Agreement. Each Lender shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from the Issuing
Lender on the Closing
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Date a participation in each such Letter of Credit and each drawing thereunder
in an amount equal to the product of (i) such Lender's Revolving Percentage
times (ii) the maximum amount available to be drawn under such Letter of Credit
and the amount of such drawing, respectively. For purposes of subsection 2.1(e)
and subsection 2.10(b), the Existing Letters of Credit shall be deemed to
utilize pro rata the Commitment of each Lender.
(b) Immediately upon the Issuance of each Letter of Credit in
addition to those described in subsection 3.3(a), each Lender shall be deemed
to, and hereby irrevocably and unconditionally agrees to, purchase from the
Issuing Lender a participation in such Letter of Credit and each drawing
thereunder in an amount equal to the product of (i) the Revolving Percentage of
such Lender, times (ii) the maximum amount available to be drawn under such
Letter of Credit and the amount of such drawing, respectively. For purposes of
subsection 2.1(e), each Issuance of a Letter of Credit shall be deemed to
utilize the Commitment of each Lender by an amount equal to the amount of such
participation.
(c) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the Issuing Lender will
promptly notify the Company. The Company shall reimburse the Issuing Lender
prior to 10:00 a.m. (San Francisco time), on each date that any amount is paid
by the Issuing Lender under any Letter of Credit (each such date, an "Honor
Date"), in an amount equal to the amount so paid by the Issuing Lender. In the
event the Company fails to reimburse the Issuing Lender for the full amount of
any drawing under any Letter of Credit by 10:00 a.m. (San Francisco time) on the
Honor Date, the Issuing Lender will promptly notify the Administrative Agent and
the Administrative Agent will promptly notify each Lender thereof, and the
Company shall be deemed to have requested that Revolving Loans consisting of
Base Rate Loans be made by the Lenders to be disbursed on the Honor Date under
such Letter of Credit, subject to the amount of the unutilized portion of the
Revolving Commitment and subject to the conditions set forth in Section 6.3. Any
notice given by the Issuing Lender or the Agent pursuant to this subsection
3.3(c) may be oral if immediately confirmed in writing (including by facsimile);
provided that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(d) Each Lender shall upon any notice pursuant to subsection 3.3(e)
make available to the Administrative Agent for the account of the Issuing Lender
an amount in Dollars and in immediately available funds equal to its Revolving
Percentage of the amount of the drawing, whereupon the participating Lenders
shall (subject to subsection 3.3(e)) each be deemed to have made a Revolving
Loan consisting of a Base Rate Loan to the Company in that amount. If any Lender
so notified fails to make available to the Administrative Agent for the account
of the Issuing Lender the amount of such Lender's Revolving Percentage of the
amount of the drawing by no later than 12:00 noon (San Francisco time) on the
Honor Date, then interest shall accrue on such Lender's obligation to make such
payment, from the Honor Date to the date such Lender makes such payment, at a
rate per annum equal to the Federal Funds Rate in effect from time to time
during such period. The Administrative Agent will promptly give notice of the
occurrence of the Honor Date, but failure of the Administrative Agent to give
any such notice on the Honor Date or in sufficient time to enable any Lender to
effect such payment on such date shall not relieve such Lender from its
obligations under this Section 3.3.
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(e) With respect to any unreimbursed drawing that is not converted
into Revolving Loans consisting of Base Rate Loans to the Company in whole or in
part, because of the Company's failure to satisfy the conditions set forth in
Section 6.3 or for any other reason, the Company shall be deemed to have
incurred from the Issuing Lender an L/C Borrowing in the amount of such drawing,
which L/C Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at a rate per annum equal to the Base Rate plus the
Applicable Base Rate Margin plus 2% per annum, and each Lender's payment to the
Issuing Lender pursuant to subsection 3.3(d) shall be deemed payment in respect
of its participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under this
Section 3.3.
(f) Each Lender's obligation in accordance with this Agreement to
make the Revolving Loans or L/C Advances, as contemplated by this Section 3.3,
as a result of a drawing under a Letter of Credit, shall be absolute and
unconditional and without recourse to the Issuing Lender and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
Issuing Lender, the Company or any other Person for any reason whatsoever; (ii)
the occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Revolving Loans under this Section 3.3 is subject to
the conditions set forth in Section 6.3.
3.4 Repayment of Participations. (a) Upon (and only upon) receipt by the
Agent for the account of the Issuing Lender of immediately available funds from
the Company (i) in reimbursement of any payment made by the Issuing Lender under
the Letter of Credit with respect to which any Lender has paid the
Administrative Agent for the account of the Issuing Lender for such Lender's
participation in the Letter of Credit pursuant to Section 3.3 or (ii) in payment
of interest thereon, the Administrative Agent will pay to each Lender, in the
same funds as those received by the Administrative Agent for the account of the
Issuing Lender, the amount of such Lender's Revolving Percentage of such funds,
and the Issuing Lender shall receive the amount of the Revolving Percentage of
such funds of any Lender that did not so pay the Agent for the account of the
Issuing Lender.
(b) If the Administrative Agent or the Issuing Lender is required at
any time to return to the Company, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of the
payments made by the Company to the Administrative Agent for the account of the
Issuing Lender pursuant to subsection 3.4(a) in reimbursement of a payment made
under the Letter of Credit or interest or fee thereon, each Lender shall, on
demand of the Administrative Agent, forthwith return to the Agent or the Issuing
Lender the amount of its Revolving Percentage of any amounts so returned by the
Administrative Agent or the Issuing Lender plus interest thereon from the date
such demand is made to the date such amounts are returned by such Lender to the
Administrative Agent or the Issuing Lender, at a rate per annum equal to the
Federal Funds Rate in effect from time to time.
3.5 Role of the Issuing Lender. (a) Each Lender and the Company agree
that, in paying any drawing under a Letter of Credit, the Issuing Lender shall
not have any
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responsibility to obtain any document (other than any sight draft and
certificates expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document.
(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Lender shall be liable
to any Lender for: (i) any action taken or omitted in connection herewith at the
request or with the approval of the Lenders (including the Required Lenders, as
applicable); (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
(c) The Company hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not,
preclude the Company's pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the Issuing Lender, shall be liable or responsible for any of the
matters described in clauses (i) through (vii) of Section 3.6; provided,
however, anything in such clauses to the contrary notwithstanding, that the
Company may have a claim against the Issuing Lender, and the Issuing Lender may
be liable to the Company, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by the Company which
the Company proves were caused by the Issuing Lender's willful misconduct or
gross negligence or the Issuing Lender's willful failure to pay under any Letter
of Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing: (i) the Issuing
Lender may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary; and (ii) the Issuing Lender shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
3.6 Obligations Absolute. The obligations of the Company under this
Agreement and any L/C-Related Document to reimburse the Issuing Lender for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Revolving Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(i) any lack of validity or enforceability of this Agreement
or any L/C-Related Document;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of the Company in
respect of any Letter of Credit or any other amendment or waiver of or any
consent to departure from all or any of the L/C-Related Documents;
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(iii) the existence of any claim, set-off, defense or other
right that the Company may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Lender or
any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by the L/C-Related Documents or any
unrelated transaction;
(iv) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under any Letter of Credit;
(v) any payment by the Issuing Lender under any Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of any Letter of Credit; or any payment
made by the Issuing Lender under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of any Letter of
Credit, including any arising in connection with any Insolvency
Proceeding;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any other guarantee, for all or any of the obligations of
the Company in respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance
that might otherwise constitute a defense available to, or a discharge of,
the Company or a guarantor.
3.7 Cash Collateral Pledge. Upon (i) the request of the Agent, (A) if the
Issuing Lender has honored any full or partial drawing request on any Letter of
Credit and such drawing has resulted in an L/C Borrowing hereunder, or (B) if,
as of the Revolving Termination Date, any Letters of Credit may for any reason
remain outstanding and partially or wholly undrawn, or (ii) the occurrence of
the circumstances described in subsection 2.7(a) requiring the Company to Cash
Collateralize Letters of Credit, then, the Company shall immediately Cash
Collateralize the Obligations in an amount equal to the L/C Obligations.
3.8 Letter of Credit Fees. (a) The Company shall pay to the Administrative
Agent for the account of each of the Lenders a letter of credit fee with respect
to the Letters of Credit equal to L/C Fee Rate of the average daily maximum
amount available to be drawn of the outstanding Letters of Credit, computed on a
quarterly basis in arrears on the last Business Day of each calendar quarter
based upon Letters of Credit outstanding for that quarter as calculated by the
Administrative Agent. Such letter of credit fees shall be due and payable
quarterly in arrears on the last Business Day of each calendar quarter during
which Letters of Credit are outstanding, commencing on the first such quarterly
date to occur after the Closing Date, through the Revolving Termination Date (or
such later date upon which the
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outstanding Letters of Credit shall expire), with the final payment to be made
on the Revolving Termination Date (or such later expiration date).
(b) The Company shall pay to the Issuing Lender a letter of credit
fronting fee for each Letter of Credit Issued after the Closing Date by the
Issuing Lender equal to the rate set forth in the Fee Letter on the face amount
(or increased face amount, as the case may be) of such Letter of Credit. Such
Letter of Credit fronting fee shall be due and payable on each date of Issuance
of a Letter of Credit.
(c) The Company shall pay to the Issuing Lender from time to time on
demand the normal issuance, presentation, amendment and other processing fees,
and other standard costs and charges, of the Issuing Lender relating to letters
of credit as from time to time in effect.
3.9 Uniform Customs and Practice. The Uniform Customs and Practice for
Documentary Credits as published by the International Chamber of Commerce
("UCP") most recently at the time of issuance of any Letter of Credit shall
(unless otherwise expressly provided in the Letters of Credit) apply to the
Letters of Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes. (a) Any and all payments by the Company to each Lender or the
Administrative Agent under this Agreement and any other Loan Document shall be
made free and clear of, and without deduction or withholding for, any Taxes. In
addition, the Company shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless each Lender
and the Administrative Agent for the full amount of Taxes or Other Taxes
(including any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section) paid by the Lender or the Administrative Agent and
any liability (including penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. Payment under this indemnification
shall be made within 30 days after the date the Lender or the Administrative
Agent makes written demand therefor.
(c) If the Company shall be required by law to deduct or withhold
any Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Lender or the Administrative Agent, then:
(i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section) such Lender or the Administrative Agent, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions or withholdings been made;
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(ii) the Company shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in accordance
with applicable law; and
(iv) the Company shall also pay to each Lender or the
Administrative Agent for the account of such Lender, at the time interest
is paid, all additional amounts which the respective Lender specifies as
necessary to preserve the after-tax yield the Lender would have received
if such Taxes or Other Taxes had not been imposed.
The Company shall not, however, be required to pay any amounts pursuant to
clause (i) of the preceding sentence to any Lender or the Issuing Lender, as the
case may be, organized under the laws of a jurisdiction outside of the United
States, unless such Lender or the Issuing Lender, as the case may be, has
provided to the Company, within sixty (60) days after the receipt by such Lender
or the Issuing Lender of a written request therefor, either (x) a facially
complete Internal Revenue Service Form 4224, Form 1001 or Form W-8 or other
applicable form, certificate or document prescribed by the Internal Revenue
Service of the United States certifying as to such Lender's or the Issuing
Lender's entitlement to an exemption from, or reduction of, United States
withholding tax on payments to be made hereunder or under any other Loan
Document or in respect of any Letter of Credit or tax on payments to made
hereunder or thereunder or (y) a letter stating that such Lender or the Issuing
Lender is unable lawfully to provide a properly completed and executed Form 4224
or Form 1001.
(d) Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes, the Company shall furnish the Administrative Agent the
original or a certified copy of a receipt evidencing payment thereof, or other
evidence of payment satisfactory to the Agent.
(e) If the Company is required to pay additional amounts to any
Lender or the Administrative Agent pursuant to subsection (c) of this Section,
then such Lender shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its Lending Office so as
to eliminate any such additional payment by the Company which may thereafter
accrue, if such change in the judgment of such Lender is not otherwise
disadvantageous to such Lender.
4.2 Illegality. (a) If any Lender determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Lender or its applicable Lending Office to make
Offshore Rate Loans, then, on notice thereof by the Lender to the Company
through the Administrative Agent, any obligation of that Lender to make Offshore
Rate Loans shall be suspended until the Lender notifies the Administrative Agent
and the Company that the circumstances giving rise to such determination no
longer exist.
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(b) If a Lender determines that it is unlawful to maintain any
Offshore Rate Loan, the Company shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to the Administrative Agent), prepay in
full such Offshore Rate Loans of that Lender then outstanding, together with
interest accrued thereon and amounts required under Section 4.4, either on the
last day of the Interest Period thereof, if the Lender may lawfully continue to
maintain such Offshore Rate Loans to such day, or immediately, if the Lender may
not lawfully continue to maintain such Offshore Rate Loan. If the Company is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Company shall borrow from the affected Lender, in the amount of
such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Lender through the Administrative Agent that all Loans which would
otherwise be made by the Lender as Offshore Rate Loans shall be instead Base
Rate Loans.
(d) Before giving any notice to the Administrative Agent under this
Section, the affected Lender shall designate a different Lending Office with
respect to its Offshore Rate Loans if such designation will avoid the need for
giving such notice or making such demand and will not, in the judgment of the
Lender, be illegal or otherwise disadvantageous to the Lender.
4.3 Increased Costs and Reduction of Return. (a) If any Lender determines
that, due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation or (ii) the compliance by that Lender
with any guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law), there shall be any increase
in the cost to such Lender of agreeing to make or making, funding or maintaining
any Offshore Rate Loan or participating in Letters of Credit, or, in the case of
the Issuing Lender, any increase in the cost to the Issuing Lender of agreeing
to issue, issuing or maintaining any Letter of Credit or of agreeing to make or
making, funding or maintaining any unpaid drawing under any Letter of Credit,
then the Company shall be liable for, and shall from time to time, upon demand
(with a copy of such demand to be sent to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender, additional amounts as are
sufficient to compensate such Lender for such increased costs.
(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
the Lender (or its Lending Office) or any corporation controlling the Lender
with any Capital Adequacy Regulation, affects or would affect the amount of
capital required or expected to be maintained by the Lender or any corporation
controlling the Lender and (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy and such Lender's
desired return on capital) that the amount of such capital is increased as a
consequence of its Commitments, loans, credits or obligations under this
Agreement, then, upon demand of such Lender to the Company through the
Administrative Agent, the Company shall pay to the Lender, from time
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to time as specified by the Lender, additional amounts sufficient to compensate
the Lender (or such corporation) for such increase.
4.4 Funding Losses. The Company shall reimburse each Lender and hold each
Lender harmless from any loss or expense which the Lender may sustain or incur
as a consequence of:
(a) the failure of the Company to make on a timely basis any payment
of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or convert a Loan
after the Company has given (or is deemed to have given) a Notice of Borrowing
or a Notice of Conversion/Continuation;
(c) the failure of the Company to make any prepayment in accordance
with any notice delivered under Section 2.6;
(d) the prepayment (including pursuant to Section 2.7) or other
payment (including after acceleration thereof) of an Offshore Rate Loan on a day
that is not the last day of the relevant Interest Period; or
(e) the automatic conversion under Section 2.4 of any Offshore Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Company to the Lenders under this Section and
under subsection 4.3(a), each Offshore Rate Loan made by a Lender (and each
related reserve, special deposit or similar requirement) shall be conclusively
deemed to have been funded at the LIBOR used in determining the Offshore Rate
for such Offshore Rate Loan by a matching deposit or other borrowing in the
interbank eurodollar market for a comparable amount and for a comparable period,
whether or not such Offshore Rate Loan is in fact so funded.
4.5 Inability to Determine Rates. If the Administrative Agent determines
that for any reason adequate and reasonable means do not exist for determining
the Offshore Rate for any requested Interest Period with respect to a proposed
Offshore Rate Loan, or that the Offshore Rate applicable pursuant to subsection
2.9(a) for any requested Interest Period with respect to a proposed Offshore
Rate Loan does not adequately and fairly reflect the cost to the Lenders of
funding such Loan the Administrative Agent will promptly so notify the Company
and each Lender. Thereafter, the obligation of the Lenders to make or maintain
Offshore Rate Loans, hereunder shall be suspended until the Administrative Agent
revokes such notice in writing. Upon receipt of such notice, the Company may
revoke any Notice of Borrowing or Notice of Conversion/Continuation then
submitted by it. If the Company does not revoke such Notice, the Lenders shall
make, convert or continue the Loans, as proposed by the Company, in the amount
specified in the applicable notice submitted by the Company, but
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such Loans shall be made, converted or continued as Base Rate Loans instead of
Offshore Rate Loans.
4.6 Substitution of Affected Lender. At any time any Lender is an Affected
Lender, the Company may replace such Affected Lender as a party to this
Agreement with one or more other bank(s) or financial institution(s)
satisfactory to the Agent (and upon notice from the Company such Affected Lender
shall assign pursuant to an Assignment and Acceptance Agreement, and without
recourse or warranty, its Commitments, if any, its Loans, its Note, its
participation in Letters of Credit, if any, and all of its other rights and
obligations hereunder to such replacement bank(s) or other financial
institution(s) for a purchase price equal to the sum of the principal amount of
the Loans so assigned, all accrued and unpaid interest thereon, its ratable
share of all accrued and unpaid non-use fees and Letter of Credit fees, any
amounts payable under Section 4.4 as a result of such Lender receiving payment
of any Eurodollar Loan prior to the end of an Interest Period therefor and all
other obligations owed to such Affected Lender hereunder).
4.7 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article IV shall deliver to the Company (with a copy to
the Administrative Agent) a certificate setting forth in reasonable detail the
amount payable to the Lender hereunder and such certificate shall be conclusive
and binding on the Company in the absence of manifest error.
4.8 Survival. The agreements and obligations of the Company in this
Article IV shall survive the payment of all other Obligations.
ARTICLE V
COLLATERAL AND GUARANTY
5.1 Collateral--Personal Property. The Obligations shall be secured by a
first lien and security interest, subject only to Permitted Liens, in all
personal property of the Company and the Guarantors (other than NEHC) to the
Security Agreement, covering the Company's and such Guarantor's presently
existing and after-acquired Inventory, Accounts Receivable, General Intangibles,
Equipment, and the other collateral more particularly described therein and in
all stock owned by the Company and its Subsidiaries pursuant to the Pledge
Agreement and the Subsidiary Pledge Agreement; provided, however, that (i) the
Company will pledge not more than 65% of the stock owned in foreign Subsidiaries
and (ii) the Obligations shall not be secured by Receivables Program Assets
transferred to a Receivables Subsidiary with respect to a Qualified Receivables
Transaction.
5.2 Mortgages. The Obligations shall be secured by a first lien and
security interest, subject to Permitted Liens, in all owned real property of the
Company and its Subsidiaries (except foreign Subsidiaries) pursuant to the
Mortgages.
5.3 Guaranty. The Obligations shall be guaranteed by the Guarantors
pursuant to the Guaranty and the NEHC Guaranty. The Company shall cause each
Subsidiary hereafter
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acquired (other than a foreign Subsidiary) to become a Guarantor and to become a
party to the Security Agreement and, if it owns stock, the Subsidiary Pledge
Agreement.
5.4 Company Stock. The Obligations shall be secured by a first lien and
security interest in the stock of the Company pursuant to the NEHC Pledge
Agreement.
5.5 Intercreditor Agreement. The Lenders and other parties hereto hereby
authorize and direct the Administrative Agent to enter into the Intercreditor
Agreement. All of the parties to this Agreement hereby agree to be bound by the
Intercreditor Agreement as if they were parties thereto. No Lender or other
party hereto shall assign any of its rights or obligations under this Agreement
to any other Person unless such other Person shall have agreed in writing to be
bound by the terms of the Intercreditor Agreement as if such Person were a party
thereto.
ARTICLE VI
CONDITIONS PRECEDENT
6.1 Conditions of Restatement. The amendment and restatement of the
Existing Credit Agreement and the obligation of each Lender to make its initial
Credit Extension hereunder is subject to the condition that the Administrative
Agent shall have received on or before the date of the initial Credit Extension
all of the following, in form and substance satisfactory to the Administrative
Agent and each Lender, and in sufficient copies for each Lender:
(a) Credit Agreement and Notes. This Agreement and the Notes
executed by each party thereto;
(b) Resolutions: Incumbency.
(i) Copies of the resolutions of the board of directors of the
Company and each Subsidiary that may become party to a Loan Document
authorizing the transactions contemplated hereby, certified as of the
Closing Date by the Secretary or an Assistant Secretary of such Person; and
(ii) A certificate of the Secretary or Assistant Secretary of
the Company, and each Subsidiary that may become party to a Loan Document
certifying the names and true signatures of the officers of the Company or
such Subsidiary authorized to execute, deliver and perform, as applicable,
this Agreement, and all other Loan Documents to be delivered by it
hereunder;
(c) Organization Documents. Each of the articles or certificate of
incorporation and the bylaws of the Company and each Subsidiary party to any
Loan Document as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary of the Company or such Subsidiary as of the Closing Date.
(d) Legal Opinions.
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(i) Opinions of Wachtell, Lipton, Rosen & Katz and Cassem,
Tierney, Adams, Gotch and Douglas, counsel to the Company and its
Subsidiaries and addressed to the Agents and the Lenders, substantially in
the form of Exhibits E and F;
(ii) To the extent required by the Administrative Agent,
opinions of local counsel to the Company and its Subsidiaries with respect
to the Mortgages in form satisfactory to the Administrative Agent.
(e) Certificate. A certificate signed by a Responsible Officer,
dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article
VII are true and correct on and as of such date, as though made on and
as of such date;
(ii) no Default or Event of Default exists or would result
from the Credit Extension; and
(iii) there has occurred since the date of the applicable
fiscal year end financial statement referred to in Section 7.11 no event or
circumstance that has resulted or could reasonably be expected to result in
a Material Adverse Effect.
(f) Collateral Documents. The Collateral Documents (excluding
Mortgages of leased property), executed by the Company or the applicable
Guarantor, in appropriate form for recording, where necessary, together with:
(i) copies of all UCC-1 and UCC-3 statements filed, registered
or recorded to perfect the security interests of the Administrative Agent
for the benefit of the Lenders, together with other evidence satisfactory
to the Administrative Agent that there has been filed, registered or
recorded all financing statements and other filings, registrations and
recordings necessary and advisable to perfect the Liens of the
Administrative Agent for the benefit of the Lenders in accordance with
applicable law;
(ii) written advice relating to such Liens and judgment
searches as the Administrative Agent shall have requested, and such
termination statements or other documents as may be necessary to confirm
that the Collateral is subject to no other Liens in favor of any Persons
(other than Permitted Liens);
(iii) all certificates and instruments representing the pledged
Collateral, together with stock transfer powers executed in blank with
signatures guaranteed as the Administrative Agent or the Lenders may
specify;
(iv) evidence that all other actions necessary or, in the
opinion of the Administrative Agent or the Lenders, desirable to perfect
and protect the first priority security interest created by the Collateral
Documents have been taken;
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(v) funds sufficient to pay any filing or recording tax or
fee in connection with any and all UCC-1 and UCC-3 financing statements
and the Mortgages;
(vi) with respect to the owned Mortgaged Property, an A.L.T.A.
1992 (or other form acceptable to the Administrative Agent and the Lenders)
mortgagee policy of title insurance or a binder issued by a title insurance
company satisfactory to the Administrative Agent and the Lenders insuring
(or undertaking to insure, in the case of a binder) that the Mortgage
creates and constitutes a valid first Lien against the Mortgaged Property
in favor of the Administrative Agent, subject only to exceptions acceptable
to the Administrative Agent and the Lenders, such endorsements and
affirmative insurance as the Administrative Agent or any Lender may
reasonably request together with copies of all title exception documents;
(vii) evidence that the Administrative Agent has been named as
loss payee under all policies of casualty insurance, and as additional
insured under all policies of liability insurance, required by the
Mortgage;
(viii) current ALTA surveys and surveyor's certification as to
all owned real property in respect of which there is delivered a Mortgage,
or as may be reasonably required by the Administrative Agent, each in form
and substance satisfactory to the Administrative and the Lenders;
(ix) proof of payment of all title insurance premiums,
documentary stamp or intangible taxes, recording fees and mortgage taxes
payable in connection with the recording of any Mortgage or the issuance of
the title insurance policies (whether due on the Closing Date or in the
future) including sums due in connection with any future advances;
(x) evidence that all other actions necessary or, in the
opinion of the Administrative Agent or the Lenders, desirable to perfect
and protect the first priority Lien created by the Collateral Documents,
and to enhance the Administrative Agent's ability to preserve and protect
its interests in and access to the Collateral, have been taken;
(g) Insurance Policies. Standard lenders' payable endorsements with
respect to the insurance policies or other instruments or documents evidencing
insurance coverage on the properties of the Company in accordance with Section
8.6;
(h) Environmental Review. Copies of all pertinent environmental due
diligence of Pilko & Associates; and
(i) Other Documents. Such other approvals, opinions, documents or
materials as the Administrative Agent or any Lender may reasonably request.
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6.2 Other Conditions to Effectiveness of Restatement. The amendment and
restatement of the Existing Credit Agreement shall be subject, in addition to
the conditions set forth in Section 6.1, to the following conditions:
(a) PFS Acquisition. The PFS Acquisition shall have occurred
pursuant to the terms of the PFS Acquisition Agreement without material
amendment or waiver and NEHC shall have assigned its rights under the PFS
Acquisition Agreement to the Company.
(b) Equity Contribution. At least $130,000,000 in proceeds shall be
contributed to the Company pursuant to a common equity contribution.
(c) Subordinated Debt. The Company shall have available to it not
less than $350,000,000 or more than $500,000,000 less underwriting spreads and
other associated fees in proceeds from the Bridge Loan on terms and conditions
satisfactory to the Administrative Agent or the Senior Subordinated Notes,
substantially on the terms described in the Preliminary Offering Memorandum
dated June 23, 1997.
(d) Accounts Receivables Securitization. Concurrently with the
initial Loan, the Company shall have received not less than $200,000,000 in
proceeds from the Receivables Bridge Facility or another Qualified Receivables
Transaction.
(e) Post. The stock of Post shall have been contributed to AmeriServ
Food Company.
(f) Existing Preferred Stock. The existing preferred stock of the
Company shall have been converted to common stock.
(g) Indebtedness. All indebtedness for borrowed money (other than
capitalized leases and industrial revenue bonds not in excess of $350,000) of
the Company, PFS and the Subsidiaries of the Company shall have been paid in
full and all related Liens shall have been released.
(h) Governmental Approvals. All governmental, shareholder and third
party consents, including Hart-Scott-Rodino clearance, and approvals necessary
in connection with the PFS Acquisition and the Post Contribution, the financings
and equity issuances contemplated hereby and the continued operations of the
business of the Company and its Subsidiaries shall have been obtained and be in
full force and effect, and all applicable waiting periods shall have expired
without any action being taken or threatened by any competent authority which
would restrain, prevent or otherwise impose adverse conditions upon the PFS
Acquisition, the Post Contribution or the financing thereof, in each case except
for such governmental and third party approvals which the failure to obtain
would not, individually or in the aggregate, have a Material Adverse Effect.
(i) Certificate. Company shall have delivered a Certificate of its
Chief Financial Officer to the effect that all the conditions set forth in
Sections 6.2(a) - (h) above shall have been accomplished.
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(j) Purchase by Lenders. The Lenders shall have purchased and sold
appropriate amounts of the outstanding Loans under the Existing Credit
Agreement, to cause each Lender to hold its Term A Percentage, Term B
Percentage, Term C Percentage, Term D Percentage and Revolving Percentage of the
appropriate Loans, after giving effect to this amendment and restatement. Each
Lender, which shall have its Total Percentage reduced to zero, shall have no
further obligations under the Existing Credit Agreement or this Agreement. If
any Lender shall suffer a loss as a result of the effectiveness of such purchase
or sale being during an Interest Period, the Company shall reimburse such Lender
the amount of such loss. Each such Lender shall furnish the Company with a
certificate setting forth the basis for determining the amount to be paid to it
under this Section.
(k) Revolving Loans. After giving effect to the PFS Acquisition, no
Revolving Loans will be outstanding.
6.3 Conditions to All Credit Extensions. The obligation of each Lender to
make any Revolving Loan to be made by it (including its initial Revolving Loan)
or to continue or convert any Revolving Loan under Section 2.4 and the
obligation of the Issuing Lender to Issue any Letter of Credit (including the
initial Letter of Credit) is subject to the satisfaction of the following
conditions precedent on the relevant Borrowing Date, Conversion/Continuation
Date or Issuance Date:
(a) Notice, Application. The Administrative Agent shall have
received (with, in the case of the initial Revolving Loan only, a copy for each
Lender) a Notice of Borrowing or a Notice of Conversion/Continuation, as
applicable, or in the case of any Issuance of any Letter of Credit, the Issuing
Lender and the Administrative Agent shall have received an L/C Application or
L/C Amendment Application, as required under Section 3.2;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VII shall be true and correct on and
as of such Borrowing Date or Conversion/Continuation Date with the same effect
as if made on and as of such Borrowing Date or Conversion/Continuation Date
(except to the extent such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct as of such earlier
date); and
(c) No Existing Default. No Default or Event of Default shall exist
or shall result from such Borrowing or continuation or conversion.
Each Notice of Borrowing, L/C Application or L/C Amendment Application submitted
by the Company hereunder shall constitute a representation and warranty by the
Company hereunder, as of the date of each such notice and as of each Borrowing
Date, or Issuance Date, as applicable, that the conditions in this Section 6.3
are satisfied.
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ARTICLE VII
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to each Agent and each Lender that:
7.1 Corporate Existence and Power. The Company and each of its
Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;
(c) is duly qualified as a foreign corporation and is licensed and
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 or license; and
(d) is in compliance with all Requirements of Law; except, in each
case referred to in clause (c) or clause (d), to the extent that the failure to
do so could not reasonably be expected to have a Material Adverse Effect.
7.2 Corporate Authorization; No Contravention. The execution, delivery and
performance by the Company and its Subsidiaries of this Agreement and each other
Loan Document to which such Person is party, have been duly authorized by all
necessary corporate action, and do not and will not:
(a) contravene the terms of any of that Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which such Person is a party or any order, injunction, writ or
decree of any Governmental Authority to which such Person or its property is
subject; or
(c) violate any Requirement of Law.
7.3 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Company or
any of its Subsidiaries of this Agreement or any other Loan Document.
7.4 Binding Effect. This Agreement and each other Loan Document to which
the Company or any of its Subsidiaries is a party constitute the legal, valid
and binding obligations of the Company and any of its Subsidiaries to the extent
it is a party thereto, enforceable against such Person in accordance with their
respective terms, except as
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enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
7.5 Litigation. Except as specifically disclosed in Schedule 7.5, there
are no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of the Company, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the Company, or its
Subsidiaries or any of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) would reasonably be expected to have a Material Adverse Effect.
No injunction, writ, temporary restraining order or any order of any nature has
been issued by any court or other Governmental Authority purporting to enjoin or
restrain the execution, delivery or performance of this Agreement or any other
Loan Document, or directing that the transactions provided for herein or therein
not be consummated as herein or therein provided.
7.6 No Default. No Default or Event of Default exists or would result from
the incurring of any Obligations by the Company. As of the Closing Date, neither
the Company nor any Subsidiary is in default under or with respect to any
Contractual Obligation in any respect which, individually or together with all
such defaults, could reasonably be expected to have a Material Adverse Effect,
or that would, if such default had occurred after the Closing Date, create an
Event of Default under subsection 10.1(e).
7.7 ERISA Compliance. Except as specifically disclosed in Schedule 7.7:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of the
Company, nothing has occurred which would cause the loss of such qualification.
The Company and each ERISA Affiliate has made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any amortization period pursuant to Section 412 of the Code
has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
the Company nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any liability under Title IV of
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ERISA with respect to any Pension Plan (other than premiums due and not
delinquent under Section 4007 of ERISA); (iv) neither the Company nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect
to a Multiemployer Plan; and (v) neither the Company nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) or
ERISA.
7.8 Use of Proceeds: Margin Regulations. The proceeds of the Loans are to
be used solely for the purposes set forth in and permitted by Section 8.12 and
Section 9.7. Neither the Company nor any Subsidiary is generally engaged in the
business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
7.9 Title to Properties. The Company and each Subsidiary have good record
and marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of their respective
businesses, except for such defects in title as could not, individually or in
the aggregate, have a Material Adverse Effect. As of the Closing Date, the
property of the Company and its Subsidiaries is subject to no Liens, other than
Permitted Liens.
7.10 Taxes. The Company and its Subsidiaries have filed all federal and
other material tax returns and reports required to be filed, and have paid all
federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment against the Company or
any Subsidiary that would, if made, have a Material Adverse Effect.
7.11 Financial Condition. (a) (i) The audited consolidated financial
statements of the Company and its Subsidiaries dated December 28, 1996, and the
related consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal year ended on that date and (ii) the unaudited
consolidated financial statements of the Company and its Subsidiaries dated
March 29, 1997, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal quarter ended on that date:
(A) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject in the case of the March 29, 1997 statements to ordinary,
good faith year end audit adjustments;
(B) fairly present the financial condition of the Company and
its Subsidiaries as of the date thereof and results of operations for the
period covered thereby; and
(C) except as specifically disclosed in Schedule 7.11, show all
material indebtedness and other liabilities, direct or contingent, of the
Company and its
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consolidated Subsidiaries as of the date thereof, including liabilities for
taxes, material commitments and Contingent Obligations.
(b) (i) The audited financial statements of Post dated December 28,
1996, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal year ended on that date and
(ii) the unaudited financial statements of Post dated March 29, 1997, and the
related consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal quarter ended on that date:
(A) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject in the case of the March 29, 1997 statements to ordinary,
good faith year end audit adjustments;
(B) fairly present the financial condition of Post as of the
date thereof and results of operations for the period covered thereby; and
(C) except as specifically disclosed in Schedule 7.11, show all
material indebtedness and other liabilities, direct or contingent, of Post
as of the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(c) The audited consolidated financial statements of PFS dated
December 28, 1994, December 27, 1995, and December 25, 1996, and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for the fiscal years ended on those dates:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein;
(ii) fairly present the financial condition of PFS as of
the date thereof and results of operations for the period covered
thereby; and
(iii) except as specifically disclosed in Schedule 7.11, show
all material indebtedness and other liabilities, direct or contingent, of
PFS as of the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(d) The pro forma consolidated closing balance sheet of the Company
and its Subsidiaries dated as of March 29, 1997:
(i) after giving effect to the PFS Acquisition, the Post
Contribution, the repayment of indebtedness described in Section 6.2(g),
the financings and equity contributions described in Section 6.2 and any
transaction adjustments as provided in the PFS Acquisition Agreement or
related to the PFS Acquisition, fairly presents the financial condition of
the Company and its Subsidiaries as of the date thereof; and
(ii) except as specifically disclosed in Schedule 7.11,
after giving effect to the PFS Acquisition, to the Post Contribution, the
repayment of indebtedness
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described in Section 6.2(g), the financing and equity contributions
described in Section 6.2 and any transaction adjustments as provided in the
PFS Acquisition Agreement or related to the PFS Acquisition shows all
material indebtedness and other liabilities, direct or contingent, of the
Company and its consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent Obligations.
(e) The Initial Financial Projections delivered to the Agents and
the Lenders prior to the execution of this Agreement were prepared by the
Company in good faith and based upon historical financial information and
assumptions the Company deems reasonable and appropriate in light of current
circumstances.
(f) Since the dates of the financial statements referred to in
subsections (a)-(d) above, there has been no Material Adverse Effect.
7.12 Environmental Matters. The Company conducts in the ordinary course of
business a review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties, and as a result
thereof the Company has reasonably concluded that, except as specifically
disclosed in Schedule 7.12, such Environmental Laws and Environmental Claims
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
7.13 Regulated Entities. None of the Company, any Person controlling the
Company, or any Subsidiary, is an "Investment Company" within the meaning of the
Investment Company Act of 1940. The Company is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other federal
or state statute or regulation limiting its ability to incur Indebtedness.
7.14 No Burdensome Restrictions. Neither the Company nor any Subsidiary is
a party to or bound by any Contractual Obligation, or subject to any restriction
in any Organization Document, or any Requirement of Law, which, in the absence
of a default thereunder, could reasonably be expected to have a Material Adverse
Effect.
7.15 Copyrights, Patents, Trademarks and Licenses. etc. The Company or its
Subsidiaries own or are licensed or otherwise have the right to use all of the
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of the Company, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Company or any
Subsidiary infringes upon any rights held by any other Person. Except as
specifically disclosed in Schedule 7.15, no claim or litigation regarding any of
the foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of the Company, proposed, which, in either case,
could reasonably be expected to have a Material Adverse Effect.
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7.16 Subsidiaries. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in part (a) of Schedule 7.16 hereto and
has no equity investments in any other corporation or entity other than those
specifically disclosed in part (b) of Schedule 7.16.
7.17 Insurance. Except as specifically disclosed in Schedule 7.17, the
properties of the Company and its Subsidiaries are insured with insurance
companies not Affiliates of the Company rated at least "A" by A.M. Best Company,
in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Company or such Subsidiary operates.
7.18 Full Disclosure. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Company to the Lenders prior to the Closing Date), contains any
untrue statement of a material fact or omits any material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time when made
or delivered.
7.19 PFS Acquisition Agreement. The representations and warranties
contained in the PFS Acquisition Agreement (a true and correct copy of which PFS
Acquisition Agreement, together with all schedules and exhibits thereto, has
been delivered to the Lenders), are true and correct in all respects except
where the failure to be so true and correct, upon consummation of the PFS
Acquisition, could not reasonably be expected to have a Material Adverse Effect.
As of the date of the PFS Acquisition, (i) the Company shall have taken all
necessary corporate actions to authorize the PFS Acquisition; and (ii) no
representation made by the Company in any notices or filings with the
shareholders of the Company, with the SEC or any applicable state securities
commissions or with any governmental authority, including, without limitation,
any representations concerning any agreement with, or financing provided by, the
Lenders, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they are
made, not misleading as of the time when made or delivered. Notwithstanding the
foregoing, all representations made in this Section 7.19 with respect to
representations of the Seller, shall be made only to the best of the Company's
knowledge.
ARTICLE VIII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Lenders waive compliance in
writing:
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8.1 Financial Statements. The Company shall deliver to the Administrative
Agent, in form and detail satisfactory to the Administrative Agent and the
Required Lenders, with sufficient copies for each Lender:
(a) as soon as available and in any event within 45 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Company, (i) consolidated balance sheet of the Company and its
Subsidiaries as of the end of such fiscal quarter, (ii) consolidated
statement of earnings and cash flow of the Company and its Subsidiaries
for such fiscal quarter and for the period commencing at the end of the
previous fiscal year and ending with the end of such fiscal quarter
setting forth in each case a comparison of the results with the
corresponding fiscal quarter of the previous year, certified by the chief
financial officer of the Company and (iii) to the extent prepared by the
Company, summary financial reports by division;
(b) as soon as available and in any event within 90 days after the
end of each fiscal year of the Company, a copy of the annual audit report
for such fiscal year for the Company and its Subsidiaries, including
therein consolidated balance sheet of the Company and its Subsidiaries as
of the end of such fiscal year and consolidated statement of earnings and
cash flow of the Company and its Subsidiaries for such fiscal year,
together with, in comparative form, the figures for the previous fiscal
year, certified (without any Impermissible Qualification) in a manner
reasonably acceptable to the Administrative Agent and the Required Lenders
by independent public accountants reasonably acceptable to the
Administrative Agent and the Required Lenders (the "Independent Auditor");
and
(c) as soon as available and in any event by January 31 of each
year, for the three year period commencing on the first day of that Fiscal
Year, the following pro forma projected financial information, each
certified as true and correct by the president or chief financial officer
of the Company to the best of such officer's knowledge: (i) the Company's
pro forma balance sheets prepared in accordance with GAAP for the next
three fiscal years, and (ii) projected pro forma statements of earnings
and cash flows and other operating information for the Company which
information presents fairly, on a pro forma basis, the balance sheets of
the Company and the Company's best good faith estimate and projections of
the Company's financial position and results of operations as of the dates
and for the periods indicated.
8.2 Certificates; Other Information. The Company shall furnish to the
Administrative Agent, with sufficient copies for each Lender:
(a) concurrently with the delivery of the financial statements
referred to in subsection 8.1(b), a certificate of the Independent Auditor
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate or that the computation of compliance with the financial ratios and
restrictions contained in Sections 9.10 through 9.15, 9.18 and 9.21 provided to
the Lenders and the Administrative Agent does not fairly present the information
set forth therein;
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(b) concurrently with the delivery of the financial statements
referred to in subsections 8.1(a) and (b), a Compliance Certificate executed by
a Responsible Officer and, concurrently with respect to the financial statements
referred to in subsection 8.1(b), a certificate executed by a Responsible
Officer setting forth the calculation of Excess Cash Flow for the fiscal year
then ended;
(c) annually, a schedule of insurance carried by the Company and its
Subsidiaries including the amounts of such insurance, deductibles and risks
covered;.
(d) promptly, (i) if the Company has capital stock that is publicly
traded, copies of all financial statements and reports that the Company sends to
its shareholders, and (ii) copies of all financial statements and regular,
periodical or special reports (including Forms 10K, 10Q and 8K) that the Company
or any Subsidiary may file with the SEC; and
(e) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the
Administrative Agent, at the request of any Lender, may from time to time
reasonably request.
8.3 Notices. The Company shall promptly notify the Administrative Agent
and each Lender:
(a) of the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that the Company reasonably
expects will become a Default or Event of Default;
(b) of any matter that has resulted or may result in a Material
Adverse Effect, including (i) breach or non-performance of, or any default
under, a Contractual Obligation of the Company or any Subsidiary; (ii) any
dispute, litigation, investigation, proceeding or suspension between the Company
or any Subsidiary and any Governmental Authority; or (iii) the commencement of,
or any material development in, any litigation or proceeding affecting the
Company or any Subsidiary, including pursuant to any applicable Environmental
Laws;
(c) of the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event more than 10 days after such
event), and deliver to the Administrative Agent and each Lender a copy of any
notice with respect to such event that is filed with a Governmental Authority
and any notice delivered by a Governmental Authority to the Company or any ERISA
Affiliate with respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability
of any Pension Plan;
(iii) the adoption of, or the commencement of contributions
to, any Plan subject to Section 412 of the Code by the Company or any
ERISA Affiliate;
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(iv) the adoption of any amendment to a Plan subject to Section
412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability;
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries;
(e) of the occurrence of any material labor dispute;
(f) of the occurrence of an "Early Amortization Event", as defined
in the Pooling and Servicing Agreement; or
(g) any event which will give rise to a prepayment pursuant to
Section 2.7(c).
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary proposes to take with respect thereto and at what time. Each notice
under subsection 8.3(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been (or
foreseeably will be) breached or violated.
8.4 Preservation of Corporate Existence, etc. The Company shall, and shall
cause each Subsidiary to:
(a) preserve and maintain in lull force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation except in connection with transactions permitted by Section 9.3
and sales of assets permitted by Section 9.2;
(b) preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
or desirable in the normal conduct of its business except in connection with
transactions permitted by Section 9.3 and sales of assets permitted by Section
9.2;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation or non-renewal of which
could reasonably be expected to have a Material Adverse Effect.
8.5 Maintenance of Property. The Company shall maintain, and shall cause
each Subsidiary to maintain, and preserve all its property which is used or
useful in its business in good working order and condition, ordinary wear and
tear excepted, and make all necessary repairs thereto and renewals and
replacements thereof except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
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8.6 Insurance. The Company shall maintain, and shall cause each Subsidiary
to maintain, with financially sound and reputable independent insurers,
insurance with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons.
8.7 Payment of Obligations. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due arid payable, all
its respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the Company or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien
upon its property; and
(c) all indebtedness, as and when due and payable, but subject to
any subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
8.8 Compliance with Laws. The Company shall comply, and shall cause each
Subsidiary to comply, in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
8.9 Compliance with ERISA. The Company shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; and (c) make all required contributions to
any Plan subject to Section 412 of the Code.
8.10 Inspection of Property and Books and Records. The Company shall
maintain and shall cause each Subsidiary to maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall permit, and shall cause each Subsidiary to permit, representatives
and independent contractors of the Administrative Agent or any Lender at the
expense of the Administrative Agent or Lender, as the case may be, to visit and
inspect any of their respective properties, to examine their respective
corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective directors, officers, and independent public accountants, all at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Company; provided,
however, when an Event of Default exists the Administrative Agent or any Lender
may do any of the
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foregoing at the expense of the Company at any time during normal business hours
and without advance notice, otherwise the expenses of only one field audit by
the Administrative Agent per year shall be paid by the Company.
8.11 Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws.
8.12 Use of Proceeds. The Company shall use the proceeds of the Loans to
repay existing Indebtedness, fund the PFS Acquisition and pay related fees and
expenses and to provide for working capital, capital expenditures and other
general corporate purposes not in contravention of any Requirement of Law or of
any Loan Document.
8.13 Further Assurances. Promptly upon the written request of the
Administrative Agent, or the Required Lenders, the Company shall, and shall
cause each Subsidiary to, execute, acknowledge, deliver, record, re-record,
file, re-file, register and re-register, any and all such further acts, deeds,
conveyances, security agreements, mortgages, assignments, estoppel certificates,
financing statements and continuations thereof, termination statements, notices
of assignment, transfers, certificates, assurances and other instruments the
Administrative Agent or the Required Lenders as the case may be, may reasonably
request from time to time in order (a) to ensure that (i) the Obligations are
secured by substantially all assets of the Company and (ii) the Obligations are
secured by substantially all of the assets of each Subsidiary (including,
promptly upon the acquisition or creation thereof, any Subsidiary created or
acquired after the date hereof), (b) to perfect and maintain the validity,
effectiveness and priority of any of the Loan Documents and the Liens intended
to be created thereby, and (c) to better assure, convey, grant, assign,
transfer, preserve, protect and confirm to the Administrative Agent and the
Lenders the rights granted or now or hereafter intended to be granted to the
Administrative Agent and the Lenders under any Loan Documents or under any other
document executed in connection therewith. Contemporaneously with the execution
and delivery of any document referred to above, the Company shall, and shall
cause each Subsidiary to, deliver all resolutions, opinions and corporate
documents as the Administrative Agent or the Required Lenders may reasonably
request to confirm the enforceability of such document and the perfection of the
security interest created thereby, if applicable.
8.14 INTENTIONALLY LEFT BLANK
8.15 Post-Closing Real Estate Matters. Within 90 days after the date
hereof the Company shall deliver to the Administrative Agent the following:
(a) unless otherwise agreed to by the Supermajority Lenders,
consents from the Landlord of each leased property to be subject to a Mortgage
in form and substance reasonably satisfactory to the Administrative Agent;
(b) unless otherwise agreed to by the Supermajority Lenders, the
Mortgages;
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(c) unless otherwise agreed to by the Supermajority Lenders, UCC
financing statements related to the Mortgages;
(d) unless otherwise agreed to by the Supermajority Lenders, with
respect to the Mortgaged Property, an A.L.T.A. 1992 (or other form acceptable to
the Administrative Agent and the Supermajority Lenders) mortgagee policy of
title insurance issued by a title insurance company satisfactory to the
Administrative Agent and the Supermajority Lenders insuring that the Mortgage
creates and constitutes at valid first Lien against the Mortgaged Property in
favor of the Administrative Agent, subject only to exceptions acceptable to the
Administrative Agent and the Supermajority Lenders, such endorsements and
affirmative insurance as the Administrative Agent or the Supermajority Lenders
may reasonably request;
(e) copies of all documents creating exceptions to title reflected
in the title policies delivered pursuant to (d) above; and
(f) to the extent required by the Administrative Agent, opinions of
local counsel in form and substance satisfactory to the Administrative Agent.
The Lenders and the Company hereby acknowledge and agree that (a) the Company
has previously granted to the Administrative Agent (and has obtained landlord
consents for) leasehold mortgages on certain of the distribution centers leased
by AmeriServ Food Company prior to its acquisition by the Company in January
1996 (such leased distribution centers being collectively referred to herein as
the "AmeriServ Food Company Distribution Centers"); and (b) the obligations of
the Company under this Section 8.15 shall be applicable only to the leased real
property acquired by the Company in connection with the PFS Acquisition, and the
Company has no obligation to grant to Administrative Agent any additional
leasehold mortgages with respect to the AmeriServ Food Company Distribution
Centers.
ARTICLE IX
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Lenders waive compliance in
writing:
9.1 Limitation on Liens. The Company shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, make, create, incur, assume or
suffer to exist any Lien upon or with respect to any part of its property,
whether now owned or hereafter acquired, other than the following ("Permitted
Liens"):
(a) any Lien existing on property of the Company or any Subsidiary
on the Closing Date and set forth in Schedule 9.1 securing Indebtedness
outstanding on such date;
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secured by any and all such purchase money security interests shall not at any
tune exceed, together with Indebtedness permitted under subsection 9.5(d),
$1,500,000;
(k) Liens securing obligations in respect of capital leases on
assets subject to such leases, provided that such capital leases are otherwise
permitted hereunder;
(l) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated by
the FRB, and (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution;
(m) other Liens to secure obligations, so long as the aggregate
amount secured by such Liens does not exceed $2,000,000 at any time;
(n) Liens on Receivables Program Assets; and
(o) Liens on assets of foreign Subsidiaries securing Indebtedness
not in excess of $10,000,000 at any time outstanding.
9.2 Asset Dispositions, etc. The Company will not, and will not permit any
of its Subsidiaries to, sell, transfer, lease, contribute or otherwise convey,
or grant options, warrants or other rights with respect to, all or any
substantial part of its assets (including accounts receivable and capital stock
of Subsidiaries) to any Person, unless
(a) such sale, transfer, lease, contribution or conveyance is in the
ordinary course of its business or is permitted by Section 9.3, is a sale and
leaseback made prior to March 31, 1998 of the Company's property in Grand
Rapids, Michigan and is on commercially reasonable terms or is a sale and
leaseback in an amount not in excess of $10,000,000 made prior to January 11,
1998 in connection with the Transportation Equipment Sale and Leaseback;
(b) with respect to any sale, transfer, lease, contribution or
conveyance which is not made in connection with the acquisition of assets by the
Company, the net book value of such assets, together with the net book value of
all other assets sold, transferred, leased, contributed or conveyed otherwise
than in the ordinary course of business by the Company or any of its
Subsidiaries pursuant to this clause since the Closing Date, does not exceed
$10,000,000;
(c) with respect to any sale, transfer, lease, contribution or
conveyance which is made in connection with the acquisition of assets by the
Company, the net book value of such assets does not exceed the net book value of
the assets acquired by the Company in connection with any such acquisition;
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(d) such sale, transfer, lease, contribution or conveyance is of
obsolete or unuseful Equipment and the aggregate proceeds of all such sales,
transfers, leases, contributions or conveyance of such Equipment is $1,000,000
or less in any fiscal year;
(e) such sale, transfer, lease, contribution or conveyance shall be
of Receivables Program Assets pursuant to a Qualified Receivables Transaction to
a Receivables Subsidiary, and the Invested Amount with respect thereto shall not
exceed $300,000,000; or
(f) such sale, transfer, lease, contribution or conveyance shall be
of Receivables Program Assets pursuant to a Qualified Receivables Transaction by
a Receivables Subsidiary to a Special Purpose Vehicle, and the Invested Amount
with respect thereto shall not exceed $300,000,000.
9.3 Consolidations and Mergers. The Company shall not, and shall not
suffer or permit any Subsidiary to, merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except:
(a) any Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one or
more Subsidiaries; provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation and if any transaction shall be between
a Guarantor and a Subsidiary which is not a Guarantor, the Guarantor shall be
the continuing or surviving corporation;
(b) any Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise) to the Company or another Wholly-Owned
Subsidiary, which wholly-owned Subsidiary is a Guarantor if the selling
Subsidiary is a Guarantor; or
(c) so long as no Default has occurred and is continuing, or would
occur after giving effect thereto, the Company or any of its Subsidiaries may
purchase all or substantially all of the assets of any Person, or acquire such
Person by merger, if such acquisition is approved by the Administrative Agent
and all the Lenders; or
(d) as permitted by Section 9.2.
9.4 Loans and Investments. The Company shall not purchase or acquire, or
suffer or permit any Subsidiary to purchase or acquire, or make any commitment
therefor, any capital stock, equity interest, or any obligations or other
securities of, or any interest in, any Person, or make or commit to make any
Acquisitions, or make or commit to make any advance, loan, extension of credit
or capital contribution to or any other investment in, any Person including any
Affiliate of the Company, except for:
(a) investments in Cash Equivalents Investments;
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(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) in the ordinary course of business extensions of credit by the
Company to any of its Subsidiaries or by any of its Subsidiaries to another of
its Subsidiaries;
(d) until such time as a Default shall have occurred and be
continuing, loans and advances to Holberg made on or after the Closing Date not
to exceed $5,000,000 at any time outstanding; provided that upon the occurrence
of such a Default, any outstanding loans and advances permitted by this clause
(d) must be immediately repaid in full;
(e) investments in a Receivables Subsidiary, consisting of
Receivables Program Assets and Purchase Money Notes in payment for Receivables
Program Assets;
(f) investments by a Receivables Subsidiary in a Special Purpose
Vehicle;
(g) (i) Acquisitions (other than those permitted under Section
9.3(c)) and investments in amounts (including cash paid and Indebtedness assumed
or refinanced) aggregating not in excess of $25,000,000 for any single
acquisition or series of related acquisitions or $60,000,000 in the aggregate
after the date hereof, so long as, in the case of an Acquisition, (A) the entity
acquired had a positive operating income for the 12 months prior to the
Acquisition, (B) the entity acquired engaged only in lines of business in which
the Company is engaged, (C) in the case of a stock Acquisition, the Acquisition
is approved by the Board of Directors of the acquired entity, and (D) giving
effect to the Acquisition (x) the Company would have been in compliance with all
covenants hereof as if such Acquisition took place on the first day of the
fiscal quarter period ending at the end of the last fiscal quarter as
demonstrated by a certificate of a Responsible Officer delivered prior to such
Acquisition and (y) at least $50,000,000 of the Revolving Commitments remain
unused, and (ii) existing investments listed on Schedule 9.4; and
(h) loans and advances to employees not to exceed $3,000,000 at any
time outstanding.
9.5 Limitation on Indebtedness. The Company shall not, and shall not
suffer or permit any Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, other than the following ("Permitted Indebtedness"):
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 9.8;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 9.5;
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(d) Indebtedness secured by Liens permitted by subsection 9.1(j) in
an aggregate amount outstanding not to exceed $1,500,000.
(e) Subordinated Debt (including without limitation the Subordinated
Debt identified in Schedule 9.5 ("Original Indebtedness") of the Disclosure
Schedule);
(f) Indebtedness with respect to any assets acquired by the Company
or any of its Subsidiaries (or assets owned by Subsidiaries the stock of which
is acquired by the Company or any of its Subsidiaries) in existence at the time
of the acquisition of such assets or stock, which Indebtedness was not incurred
in contemplation of the acquisition; provided that such Indebtedness does not in
an aggregate amount outstanding exceed $5,000,000;
(g) Capitalized Lease Obligations not in excess of $40,000,000
created in any one fiscal year and not in excess of $75,000,000 at any time
outstanding;
(h) Other notes payable to vendors not in excess of $2,000,000 at
any time outstanding;
(i) The Bridge Loan or, if the Bridge Loan is repaid with the
proceeds of the Senior Subordinated Notes, the Senior Subordinated Notes;
(j) Indebtedness of foreign Subsidiaries not in excess of
$10,000,000 at any time outstanding;
(k) Other Indebtedness not in excess of $2,000,000 at any time
outstanding;
(l) Receivables Program Obligations, pursuant to a Qualified
Receivables Transaction.
9.6 Transactions with Affiliates. The Company will not, and will not
permit any of its Subsidiaries to, enter into, or cause, suffer or permit to
exist any arrangement or contract with any of its other Affiliates (a) unless
such arrangement or contract is fair and equitable to the Company or such
Subsidiary and is an arrangement or contract of the kind which would be entered
into by a prudent Person in the position of the Company or such Subsidiary with
a Person which is not one of its Affiliates, it being understood that any
Qualified Receivables Transaction shall be deemed to satisfy this clause (a);
(b) except (i) the arrangement between Holberg and the Company under the Tax
Sharing Agreement, and (ii) the insurance arrangement between NEHC and its
Subsidiaries and an affiliate of Holberg, the fees with respect to which shall
not exceed the usual and customary fees for such services; (c) except
arrangements or contracts which provide for investments in Affiliates of the
Company or any of its Subsidiaries to the extent such investments are permitted
pursuant to Section 9.4 provided, however, that unless an Event of Default shall
have occurred and be continuing, Corporate Allocations permitted under Section
9.11 can be paid; (d) transactions between the Company or its Subsidiaries on
the one hand and DLJ or its Affiliates on the other hand involving the provision
of financial, investment banking, lending, management, consulting or
underwriting services by DLJ or its Affiliates; provided that the fees payable
to DLJ or its Affiliates do not exceed the usual and customary fees of DLJ or
its Affiliates, as the case
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may be, for such services or the usual and customary fees of other New York
investment banking firms for such services; or (e) transactions between the
Company and Holberg involving the provision of financial, management or
consulting services in connection with acquisitions provided that (i) the fees
payable by the Company for such services do not exceed the usual and customary
fees for such services (it being agreed that a payment of $4,000,000 with
respect to PFS Acquisition and related transactions shall be permitted) and (ii)
the payment of any such fees shall be subject to the consent of the
Administrative Agent or, if in excess of $2,000,000 in any fiscal year, the
Required Lenders.
9.7 Use of Proceeds. The Company shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the Loan proceeds or any Letter of Credit,
directly or indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or
otherwise refinance indebtedness of the Company or others incurred to purchase
or carry Margin Stock, (iii) to extend credit for the purpose of purchasing or
carrying any Margin Stock or (iv) to acquire any security in any transaction
that is subject to Section 13 or 14 of the Exchange Act.
9.8 Contingent Obligations. The Company shall not, and shall not suffer or
permit any Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Hedging Agreements entered into in the ordinary course of
business as bona fide hedging transactions;
(c) Contingent Obligations of the Company and its Subsidiaries
existing as of the Closing Date and listed in Schedule 9.8;
(d) other Contingent Obligations so long as the aggregate amount of
such Contingent Obligations outstanding at any one time does not exceed
$1,000,000;
(e) Receivables Program Obligations; and
(f) guarantees of the Obligations and the Senior Subordinated Notes.
9.9 Joint Ventures. The Company shall not, and shall not suffer or permit
any Subsidiary to enter into any Joint Venture, other than in the ordinary
course of business and other than as permitted by Section 9.4(g).
9.10 Rental Obligations. The Company will not, and will not permit any of
its Subsidiaries to, enter into at any time any arrangement which does not
create a Capitalized Lease Liability and which involves the leasing by the
Company or any of its Subsidiaries from any lessor of any real or personal
property (or any interest therein), except arrangements which, together with all
other such arrangements which shall then be in effect, will not require the
payment of an aggregate amount of rentals by the Company and its Subsidiaries in
excess of (excluding escalations resulting from a rise in the consumer price or
similar index) $50,000,000 for any fiscal year; provided, however, that any
calculation made
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for purposes of this section shall exclude any amounts required to be expended
for maintenance and repairs, insurance, taxes, assessments, and other similar
charges.
9.11 Restricted Payments. On and at all times after the Closing Date:
(a) the Company will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any class
of capital stock (now or hereafter outstanding) of the Company or on any
warrants, options or other rights with respect to any shares of any class
of capital stock (now or hereafter outstanding) of the Company (other than
dividends or distributions payable in its common stock or warrants to
purchase its common stock or splitups or reclassifications of its stock
into additional or other shares of its common stock) or apply, or permit
any of its Subsidiaries to apply, any of its funds, property or assets to
the purchase, redemption, sinking fund or other retirement of, or agree or
permit any of its Subsidiaries to purchase or redeem, any shares of any
class of capital stock (now or hereafter outstanding) of the Company, or
warrants, options or other rights with respect to any shares of any class
of capital stock (now or hereafter outstanding) of the Company;
(b) the Company will not, and will not permit any of its
Subsidiaries to
(i) other than repayments of the Bridge Loan with proceeds of
Senior Subordinated Notes, make any payment or prepayment of principal of,
or make any payment of interest on, any Subordinated Debt on any day other
than the stated, scheduled date for such payment or prepayment set forth
in the documents and instruments memorializing such Subordinated Debt, or
which would violate the subordination provisions of such Subordinated
Debt; or
(ii) redeem, purchase or defease any Subordinated Debt;
(c) except as otherwise permitted under this Section 9.11, the
Company will not make any payment to NEHC or Holberg, including without
limitation, in respect of Corporate Allocations and will not make any payment
with respect to annual management fees; and
(d) the Company will not, and will not permit any Subsidiary to,
make any deposit for any of the foregoing purposes;
provided, however, that, unless immediately before or after giving effect
thereto, any Event of Default shall have occurred and be continuing, the Company
may declare, pay or make payments in respect of
(i) Corporate Allocations during any fiscal year of the
Company in an aggregate amount not to exceed $4,000,000 in any fiscal
year;
(ii) Payments with respect to the insurance arrangements
permitted pursuant to Section 9.6(b)(ii);
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(iii) Payments permitted pursuant to Section 9.6(e);
(iv) Payments under the Tax Sharing Agreement;
(v) commencing after five and one half years after the date of
this Agreement, payments of dividends so long as (A) the amounts of such
payments do not exceed $13,000,000 in any fiscal year after the date
hereof, and (B) the Company would be in pro forma compliance w1th all
covenants hereunder, as if such dividends were paid on the last day of the
last fiscal quarter ended before such proposed payment; and
(vi) fees and expenses not to exceed $2,500,000 incurred by
NEHC in connection with its issuance of the Senior Discount Notes due
2007.
9.12 Minimum Fixed Charge Coverage. The Company will not permit the Fixed
Charge Coverage Ratio for any Computation Period ending on or after December 31,
1997 to be less than 1.10 to 1.0.
9.13 Minimum Interest Coverage. The Company will not permit the Interest
Coverage Ratio for any Computation Period to be less than the ratio set forth
below opposite the period in which such Computation Period ends:
Period Ratio
------ -----
December 31, 1997 through March 31, 1998 1.35 to 1.0
April 1, 1998 through March 31, 2000 1.50 to 1.0
April 1, 2000 through March 31, 2001 1.75 to 1.0
April 1, 2001 through March 31, 2002 2.00 to 1.0
April 1, 2002 through March 31, 2003 2.25 to 1.0
April 1, 2003 and thereafter 2.50 to 1.0
9.14 Maximum Leverage. The Company will not permit the Leverage Ratio at
any time to exceed the following ratios during the following periods:
Period Ratio
------ -----
September 30, 1997 through June 30, 1998 6.95 to 1.0
July 1, 1998 through March 31, 1999 6.75 to 1.0
April 1, 1999 through March 31, 2000 6.50 to 1.0
April 1, 2000 through March 31, 2001 5.75 to 1.0
April 1, 2001 through March 31, 2002 5.25 to 1.0
April 1, 2002 through March 31, 2003 4.75 to 1.0
April 1, 2003 and thereafter 4.25 to 1.0
9.15 ERISA. The Company shall not, and shall not suffer or permit any of
its ERISA Affiliates to: (a) engage in a prohibited transaction or violation
of the fiduciary responsibility rules with respect to any Plan which has
resulted or could reasonably expected
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to result in liability of the Company in an aggregate amount in excess of
$5,000,000 or (b) engage in a transaction that could be subject to Section 4069
or 4212(c) of ERISA.
9.16 Modification of Certain Agreements. The Company will not consent to
any amendment, supplement or other modification of any of the terms or
provisions contained in, or applicable to, the Tax Sharing Agreement or any
document or instrument evidencing or applicable to any Subordinated Debt, other
than any amendment, supplement or other modification which extends the date or
reduces the amount of any required repayment or redemption.
9.17 Negative Pledges, Restrictive Agreements, etc. The Company will not,
and will not permit any of its Subsidiaries to, enter into any agreement
(excluding this Agreement, any other Loan Document and any agreement governing
any Indebtedness permitted either by clause (c) or clause (i) of Section 9.5 as
in effect on the Closing Date or by either of clause (d) or clause (f) of
Section 9.5 as to the assets financed with the proceeds of such Indebtedness)
prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets (other than Receivables Program Assets), whether now owned or
hereafter acquired, or the ability of the Company or any Subsidiary to amend or
otherwise modify this Agreement or any other Loan Document; or
(b) the ability of any Subsidiary (other than a Receivables
Subsidiary) to make any payments, directly or indirectly, to the Company by way
of dividends, advances, repayments of loans or advances, reimbursements of
management and other intercompany charges, expenses and accruals or other
returns on investments, or any other agreement or arrangement which restricts
the ability of any Subsidiary (other than a Receivables Subsidiary) to make any
payment, directly or indirectly, to the Company.
9.18 Maximum Capital Expenditures. The Company will not permit the
aggregate amount of all Capital Expenditures made by the Company and its
Subsidiaries in the period from the Closing Date through December 31, 1998, to
exceed $50,000,000, and in any fiscal year thereafter, to exceed $22,000,000;
provided, that the Company may, in addition to the foregoing, make Capital
Expenditures of up to $8,000,000 on or before March 31, 1998 in respect of the
sale and leaseback of the Grand Rapids, Michigan distribution center; provided,
further, that the Company may, in addition to the foregoing, make Capital
Expenditures of up to $10,000,000 on or before January 11, 1998 in respect of
the Transportation Equipment Sale and Leaseback and provided, further, that if
the Company and its Subsidiaries do not expend the full amount scheduled to be
permitted in any period, the amount not so expended may be carried over for
expenditures in the next fiscal year but not after such next fiscal year.
9.19 Change in Business. The Company shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business substantially
different from those lines of business carried on by the Company and its
Subsidiaries on the date hereof.
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9.20 Accounting Changes. The Company shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
the Company or of any Subsidiary.
9.21 Restructuring Costs. The Company shall not, and shall not suffer or
permit any Subsidiary to, incur Restructuring Costs in excess of the following
amounts in the following periods:
Period Amount
------ ------
Closing Date through December 31, 1998 $55,000,000
January 1, 1999 through December 31, 1999 $20,000,000
January 1, 2000 through December 31, 2000 $ 5,000,000
Each year thereafter $ 3,000,000;
provided, however, that if the Company and its Subsidiaries do not incur the
full amount of restructuring costs scheduled to be permitted in any such period,
the amount not so incurred may be carried over for incurrence in the next period
but not after such next period.
9.22 Receivables Facility. The Company and its Subsidiaries shall not
amend or modify, or permit the amendment or modification of, any provision of a
Receivables Document if, as a result of such amendment or modification:
(a) a Receivables Subsidiary would not be required to apply all
funds available to it (after giving effect to the allocation of funds to
reserves required under the terms of the Receivables Documents and to the
payment of interest, principal and other amounts owed under the
Receivables Documents) to pay the purchase price for Receivables
(including any deferred portion of the purchase price);
(b) the degree of recourse to the Company or its Subsidiaries under
or in the respect of the Receivables Documents is increased in any
material respect; or
(c) the Invested Amount with respect thereto shall exceed
$300,000,000.
Notwithstanding anything to the contrary contained in this Section, any
changes to the Receivables Documents which relate to the Company's and/or any
other Receivables Seller's servicing or origination of Receivables Program
Assets shall be permitted.
ARTICLE X
EVENTS OF DEFAULT
10.1 Event of Default. Any of the following shall constitute an "Event of
Default":
(a) Non-Payment. The Company fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan or of any L/C Obligation
or (ii) within 5
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days after the same becomes due, any interest, fee or any other amount payable
hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by
the Company, NEHC, or any Subsidiary made or deemed made herein, in any other
Loan Document, or which is contained in any certificate, document or financial
or other statement by the Company, NEHC, any Subsidiary or any Responsible
Officer, furnished at any time under this Agreement, or in or under any other
Loan Document, is incorrect in any material respect on or as of the date made
or deemed made; or
(c) Specific Defaults. The Company fails to perform or observe any
term, covenant or agreement contained in any of Section 8.1, 8.2, 8.3 or 8.9 or
in Article IX; or
(d) Other Defaults. The Company, any Subsidiary party thereto or
NEHC fails to perform or observe any other term or covenant contained in this
Agreement or any other Loan Document, and such default shall continue unremedied
for a period of 20 days after the date upon which written notice thereof is
given to the Company by the Administrative Agent or any Lender; or
(e) Cross-Default. NEHC, the Company or any Subsidiary (other than a
Receivables Subsidiary) (i) fails to make any payment (including any mandatory
prepayment or redemption) in respect of any Indebtedness or Contingent
Obligation having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than $5,000,000 when due
(whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) and such failure continues after the applicable grace or notice
period, if any, specified in the relevant document on the date of such failure;
or (ii) fails to perform or observe any other condition or covenant, or any
other event shall occur or condition exist, under any agreement or instrument
relating to any such Indebtedness or Contingent Obligation, and such failure
continues after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure if the effect of such failure,
event or condition is to cause, or to permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a trustee
or agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause such Indebtedness to be declared to be due and payable prior to its stated
maturity, or such Contingent Obligation to become payable or cash collateral in
respect thereof to be demanded or; or
(f) Insolvency; Voluntary Proceedings. The Company, NEHC or any
Subsidiary other than a Receivables Subsidiary (i) ceases or fails to be
solvent, or generally fails to pay, or admits in writing its inability to pay,
its debts as they become due, subject to applicable grace periods, if any,
whether at stated maturity or otherwise; (ii) voluntarily ceases to conduct its
business in the ordinary course; (iii) commences any Insolvency Proceeding with
respect to itself; or (iv) takes any action to effectuate or authorize any of
the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company, NEHC or any Subsidiary
other than a Receivables
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Subsidiary, or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial part of the Company's, NEHC's
or any Subsidiary's properties, and any such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or similar
process shall not be released, vacated or fully bonded within 60 days after
commencement, filing or levy; (ii) the Company, NEHC or any Subsidiary other
than a Receivables Subsidiary admits the material allegations of a petition
against it in any Insolvency Proceeding, or an order for relief (or similar
order under non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the
Company, NEHC or any Subsidiary other than a Receivables Subsidiary acquiesces
in the appointment of a receiver, trustee, custodian, conservator, liquidator,
mortgagee in possession (or agent therefor), or other similar Person for itself
or a substantial portion of its property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Company under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $5,000,000
unless the ERISA Event is a contribution failure sufficient to give rise to a
Lien under Section 302(f) of ERISA in which case the dollar liability threshold
does not apply; the aggregate amount of Unfunded Pension Liability among all
Pension Plans at any time exceeds $5,000,000; or (iii) the Company or any ERISA
Affiliate shall fail to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $5,000,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company, NEHC or any Subsidiary other than a Receivables Subsidiary involving in
the aggregate a liability (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage) as to any single or
related series of transactions, incidents or conditions, of $1,000,000 or more,
and the same shall remain unsatisfied, unvacated and unstayed pending appeal for
a period of 10 days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is
entered against the Company, NEHC or any Subsidiary which does or would
reasonably be expected to have a Material Adverse Effect, and there shall be any
period of 10 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(k) Change of Control. There occurs any Change of Control or any "Change
of Control" or like event as defined in any other indenture or other agreement
or instrument pursuant to which Indebtedness or equity is issued or Receivables
are sold by NEHC, the Company or any Subsidiary; or
(l) Impairment of Security, etc. Any Loan Document, or any Lien granted
thereunder, shall (except in accordance with its terms), in whole or in part,
terminate, cease to be effective or cease to be the legally valid, binding and
enforceable obligation of the Company, NEHC or any Subsidiary party thereto; the
Company, NEHC, or any Subsidiary shall, directly or indirectly, contest in any
manner such effectiveness, validity, binding nature
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or enforceability; or any Lien securing any Liability shall, in whole or in
part, cease to be a perfected first priority Lien; provided, however, no Event
of Default hereunder shall exist to the extent (A) the failure of such Lien to
remain effective is due solely to the negligence of the Agent or the Lenders or
(B) the failure to maintain perfection of such Lien is due solely to the failure
of the Agent to file appropriate Uniform Commercial Code continuation
statements.
10.2 Remedies. If any Event of Default occurs, the Administrative Agent
shall, at the request of, or may, with the consent of, the Required Lenders,
(a) declare the commitment of each Lender to make Loans and any
obligation of the Issuing Lender to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is
or at any time thereafter may become available for drawing under any outstanding
Letters of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, and
declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Company; and
(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 10.1 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each
Lender to make Loans and any obligation of the Issuing Lender to Issue Letters
of Credit shall automatically terminate and the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable without further act of the Administrative
Agent, the Issuing Lender or any Lender.
10.3 Rights Not Exclusive. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE XI
THE AGENTS
11.1 Appointment and Authorization. (a) Each Lender hereby irrevocably
(subject to Section 11.9) appoints, designates and authorizes the Administrative
Agent to take such
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action on its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere in this Agreement or in any
other Loan Document, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the
Administrative Agent have or be deemed to have 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.
(b) The Issuing Lender shall act on behalf of the Lenders with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Administrative Agent may
agree at the request of the Required Lenders to act for such Issuing Lender with
respect thereto; provided, however, that the Issuing Lender shall have all of
the benefits and immunities (i) provided to the Administrative Agent in this
Article XI with respect to any acts taken or omissions suffered by the Issuing
Lender in connection with Letters of Credit Issued by it or proposed to be
Issued by it and the application and agreements for letters of credit pertaining
to the Letters of Credit as fully as if the term "Administrative Agent," as used
in this Article XI, included the Issuing Lender with respect to such acts or
omissions and (ii) as additionally provided in this Agreement with respect to
the Issuing Lender.
11.2 Delegation of Duties. The Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through agents,
employees 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 agent or
attorney-in-fact that it selects with reasonable care.
11.3 Liability of Administrative Agent. None of the Agent-Related Persons
shall (i) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct) or (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by the Company or any
Subsidiary or Affiliate of the Company, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan Document, or
the validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of the Company or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall 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 the Company or any
of the Company's Subsidiaries or Affiliates.
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11.4 Reliance by Administrative Agent. (a) The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, statement 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 counsel to the Company), independent accountants and
other experts selected by 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 and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
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 or any other Loan Document in accordance with a request or
consent of the Required Lenders (or the Supermajority Lenders or all Lenders as
required herein) and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 6.1, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Administrative Agent to such Lender
for consent, approval, acceptance or satisfaction, or required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lender unless
such Lender has provided written notice to the Agent of its lack of consent,
approval or satisfaction.
11.5 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,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Lenders,
unless the Administrative Agent shall have received written 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 of default." The
Administrative Agent will promptly notify the Lenders of its receipt of any such
notice. The Administrative Agent shall take such action with respect to such
Default or Event of Default as may be requested by the Required Lenders in
accordance with Article X; provided, however, that unless and until the
Administrative Agent has received any such request, the Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable or in the best interest of the Lenders.
11.6 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Administrative Agent hereinafter taken, including any review of the
affairs of the Company and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition
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and creditworthiness of the Company and its Subsidiaries, and all applicable
bank regulatory laws relating to the transactions contemplated hereby, and made
its own decision to enter into this Agreement and to extend credit to the
Company hereunder. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person 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 investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company.
Except for notices, reports and other documents expressly herein required to be
furnished to the Lenders by the Administrative Agent, the Administrative Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of the Company which may come
into the possession of any of the Agent-Related Persons.
11.7 Indemnification of Administrative Agent. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand the Agent-Related Persons (to the extent not reimbursed by or on
behalf of the Company and without limiting the obligation of the Company to do
so), pro rata, from and against any and all Indemnified Obligations; provided,
however, that no Lender shall be liable for the payment to the Agent-Related
Persons of any portion of such Indemnified Obligations resulting solely from
such Person's gross negligence or willful misconduct. Without limitation of the
foregoing, each Lender shall reimburse the Administrative Agent upon demand for
its ratable share of any costs or out-of-pocket expenses (including Attorney
Costs) incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein, to the
extent that the Administrative Agent is not reimbursed for such expenses by or
on behalf of the Company. The undertaking in this Section shall survive the
payment of all Obligations hereunder and the resignation or replacement of the
Administrative Agent.
11.8 Administrative Agent in Individual Capacity. BofA and its Affiliates
may make loans to, issue letters of credit for the account of, accept deposits
from, acquire equity interests in and generally engage in any kind of banking,
trust, financial advisory, underwriting or other business with the Company and
its Subsidiaries and Affiliates as though BofA were not the Administrative Agent
or BofA were not the Issuing Lender hereunder and without notice to or consent
of the Lenders. The Lenders acknowledge that, pursuant to such activities, BofA
or its Affiliates may receive information regarding the Company or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Company or such Subsidiary) and acknowledge that the
Administrative Agent shall be under no obligation to provide such information to
them. With respect to its Loans, BofA shall have the same rights and powers
under this Agreement as any other Lender and may exercise the same as though it
were not the Administrative Agent or the Issuing Lender.
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11.9 Successor Agent. The Administrative Agent may, and at the request of
the Required Lenders shall, resign as Administrative Agent upon 30 days' notice
to the Lenders. If the Administrative Agent resigns under this Agreement, the
Required Lenders shall appoint from among the Lenders a successor agent for the
Lenders. If no successor agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Company, a successor agent from among
the Lenders. Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor agent and the retiring Agent's appointment, powers and
duties as Administrative Agent shall be terminated. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article XI and Sections 12.4 and 12.5 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. If no successor agent has accepted
appointment as Administrative Agent by the date which is 30 days following a
retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above. Notwithstanding the foregoing, however, BofA may
not be removed as the Administrative Agent at the request of the Required
Lenders unless BofA shall also simultaneously be replaced as "Issuing Lender"
hereunder pursuant to documentation in form and substance reasonably
satisfactory to BofA.
11.10 Withholding Tax. (a) If any Lender is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Lender claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code or if any Lender claims exemption from withholding tax pursuant
to Section 871(h) or 881(c) of the Code, such Lender agrees with and in favor of
the Administrative Agent, to deliver to the Administrative Agent:
(i) if such Lender claims an exemption from, or a reduction
of, withholding tax under a United States tax treaty, properly completed
IRS Form 1001 before the payment of any interest in the first calendar
year and before the payment of any interest in each third succeeding
calendar year during which interest may be paid under this Agreement;
(ii) if such Lender claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form 4224 before
the payment of any interest is due in the first taxable year of such
Lender and in each succeeding taxable year of such Lender during which
interest may be paid under this Agreement, and IRS Form W-9;
(iii) in the case of any Lender that is exempt from
withholding tax pursuant to Section 881(h) or 881(c) of the Code, properly
completed IRS Form W-8 or any applicable successor form before the payment
of any interest is due; and
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(iv) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption from,
or reduction of, United States withholding tax.
Such Lender agrees to promptly notify the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of the Company to such Lender, such Lender agrees
to notify the Administrative Agent of the percentage amount in which it is no
longer the beneficial owner of Obligations of the Company to such Lender. To the
extent of such percentage amount, the Administrative Agent will treat such
Lender's IRS Form 1001 as no longer valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Administrative Agent sells, assigns, grants
a participation in, or otherwise transfers all or part of the Obligations of the
Company to such Lender, such Lender agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any interest payment
to such Lender an amount equivalent to the applicable withholding tax after
taking into account such reduction. If the forms or other documentation required
by subsection (a) of this Section are not delivered to the Administrative Agent,
then the Administrative Agent may withhold from any interest payment to such
Lender not providing such forms or other documentation an amount equivalent to
the applicable withholding tax.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Administrative Agent did
not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered, was not properly executed, or
because such Lender failed to notify the Administrative Agent of a change in
circumstances which rendered the exemption from, or reduction of, withholding
tax ineffective, or for any other reason) such Lender shall indemnify the
Administrative Agent fully for all amounts paid, directly or indirectly, by the
Administrative Agent as tax or otherwise, including penalties and interest, and
including any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Lenders under this subsection
shall survive the payment of all Obligations and the resignation or replacement
of the Administrative Agent.
11.11 Collateral Matters.
(a) The Administrative Agent is authorized on behalf of all the
Lenders; without the necessity of any notice to or further consent from the
Lenders, from time to time to take any action with respect to any Collateral or
the Loan Documents which may be
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necessary to perfect and maintain perfected the security interest in and Liens
upon the Collateral granted pursuant to the Loan Documents.
(b) The Lenders irrevocably authorize the Administrative Agent, at
its option and in its discretion, to release any Lien granted to or held by the
Administrative Agent upon any Collateral (i) upon termination of the Commitments
and payment in full of all Loans and all other obligations known to the
Administrative Agent and payable under this Agreement or any other Loan
Document; (ii) constituting property sold or to be sold or disposed of as part
of or in connection with any disposition permitted hereunder; (iii) constituting
property in which the Company or any Subsidiary owned no interest at the time
the Lien was granted or at any time thereafter; (iv) constituting property
leased to the Company or any Subsidiary under a lease which has expired or been
terminated in a transaction permitted under this Agreement or is about to expire
and which has not been, and is not intended by the Company or such Subsidiary to
be, renewed or extended; (v) consisting of an instrument evidencing Indebtedness
or other debt instrument, if the indebtedness thereby has been paid in full; or
(vi) if approved, authorized or ratified in writing by the Required Lenders or,
if required by Section 12.1(e), all the Lenders. Upon request by the
Administrative Agent at any time, the Lenders will confirm in writing the
Administrative Agent's authority to release particular types or items of
Collateral pursuant to this subsection 11.11(b).
11.12 Documentation Agent. No Lender identified as a "Documentation Agent"
shall have any right, power, obligation, liability, responsibility or duty under
this Agreement other than those applicable to all Lenders as such. Without
limiting the foregoing, none of the Lenders so identified as a "Documentation
Agent" shall have or be deemed to have any fiduciary responsibility with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders so identified and decided to enter into this Agreement or in
taking or not taking action hereunder.
ARTICLE XII
MISCELLANEOUS
12.1 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement, any other Loan Document or the Intercreditor Agreement, and no
consent with respect to any departure by the Company, NEHC or any applicable
Subsidiary therefrom, shall be effective unless the same shall be in writing and
signed by the Required Lenders (or by the Administrative Agent at the written
request of the Required Lenders) and the Company and acknowledged by the
Administrative Agent, and then any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however, that no such waiver, amendment, or consent shall, unless in
writing and signed by all the Lenders and the Company and acknowledged by the
Administrative Agent, do any of the following:
(a) increase or extend the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 10.2);
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(b) reduce the amount of, postpone or delay any date fixed by this
Agreement or any other Loan Document for any payment or prepayment of principal,
interest, fees or other amounts due to the Lenders (or any of them) hereunder or
under any other Loan Document or amend the application of payments with respect
thereto;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (ii) below) any fees or other amounts
payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Lenders or any of
them to take any action hereunder;
(e) release all or any substantial part of the Collateral or release
any Guarantor;
(f) extend any Letter of Credit expiration date to a date beyond the
Revolving Termination Date; or
(g) amend this Section, or Section 2.14, or any provision herein
providing for consent or other action by all Lenders;
and, provided further that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Lender in addition to the Required Lenders or
all the Lenders, as the case may be, affect the rights or duties of the Issuing
Lender under this Agreement or any L/C-Related Document relating to any Letter
of Credit Issued or to be Issued by it, (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition to
the Required Lenders or all the Lenders, as the case may be, affect the rights
or duties of the Administrative Agent under this Agreement or any other Loan
Document, and (iii) the Fee Letters may be amended, or rights or privileges
thereunder waived, in a writing executed by the parties thereto and; provided,
further, that, at the Company's request, the Administrative Agent shall, without
the consent of any Lender, release the security interest of the Administrative
Agent and the Lenders in any property subject to Capitalized Lease Obligations
permitted under Section 9.5(g).
12.2 Notices. (a) All notices, requests and other communications shall be
in writing (including, unless the context expressly otherwise provides, by
facsimile transmission, provided that any matter transmitted by the Company by
facsimile (i) shall be immediately confirmed by a telephone call to the
recipient at the number specified on Schedule 12.2 and (ii) shall be followed
promptly by delivery of a hard copy original thereof) and mailed, faxed or
delivered to the address or facsimile number specified for notices on Schedule
12.2; or, as directed to the Company or the Administrative Agent, to such other
address as shall be designated by such party in a written notice to the other
parties, and as directed to any other party, at such other address as shall be
designated by such party in a written notice to the Company and the
Administrative Agent.
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(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Article II, III or XI shall not be effective until actually
received by the Administrative Agent, and notices to the Issuing Lender pursuant
to Article III shall not be effective until actually received by the Issuing
Lender at the address specified for the Issuing Lender on Schedule 12.2.
(c) Any agreement of the Administrative Agent and the Lenders herein
to receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Company. The Administrative Agent and the
Lenders shall be entitled to rely on the authority of any Person purporting to
be a Person authorized by the Company to give such notice and the Administrative
Agent and the Lenders shall not have any liability to the Company or other
Person on account of any action taken or not taken by the Administrative Agent
or the Lenders in reliance upon such telephonic or facsimile notice. The
obligation of the Company to repay the Loans and L/C Obligations shall not be
affected in any way or to any extent by any failure by the Administrative Agent
and the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Administrative Agent and the Lenders of a
confirmation which is at variance with the terms understood by the
Administrative Agent and the Lenders to be contained in the telephonic or
facsimile notice.
12.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder, 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.
12.4 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Administrative
Agent and Issuing Lender) and DLJ (including in its capacity as Documentation
Agent) within five Business Days after demand for all costs and expenses
incurred by BofA (including in its capacity as Administrative Agent and Issuing
Lender) and DLJ (including in its capacity as Documentation Agent) in connection
with the development, preparation, delivery, administration and execution of,
and any amendment, supplement, waiver or modification to (in each case, whether
or not consummated), this Agreement, any Loan Document and any other documents
prepared in connection herewith or therewith, and the consummation of the
transactions contemplated hereby and thereby, including reasonable Attorney
Costs incurred by BofA (including in its capacity as Administrative Agent and
Issuing Lender) and DLJ (including in its capacity as Documentation Agent) with
respect thereto; and
(b) pay or reimburse the Administrative Agent, the Arranger and each
Lender within five Business Days after demand for all costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or any other Loan Document
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during the existence of an Event of Default or after acceleration of the Loans
(including in connection with any "workout" or restructuring regarding the
Loans, and including in any Insolvency Proceeding or appellate proceeding).
12.5 Company Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Company shall indemnify and hold the Agent-Related
Persons, and each Lender and each of its respective officers, directors,
employees, counsel, agents and attorneys-in-fact (each, an "Indemnified Person")
harmless from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, charges, expenses and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time (including at any time following repayment of the Loans, the termination of
the Letters of Credit and the termination, resignation or replacement of any
Agent or replacement of any Lender) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this Agreement
or any document contemplated by or referred to herein, or the transactions
contemplated hereby, or any action taken or omitted by any such Person under or
in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding or
appellate proceeding) related to or arising out of this Agreement or the Loans
or Letters of Credit or the use of the proceeds thereof, whether or not any
Indemnified Person is a party thereto (all the foregoing, collectively, the
"Indemnified Obligations"); provided, that the Company shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Obligations
resulting solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
12.6 Payments Set Aside. To the extent that the Company makes a payment to
the Administrative Agent or the Lenders, or the Administrative Agent or the
Lenders exercise their right of set-off, and such payment or the proceeds of
such set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent
of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its pro rata
share of any amount so recovered from or repaid by the Administrative Agent,
which had previously been received by such Lender.
12.7 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Administrative Agent and each Lender.
12.8 Assignments, Participations, etc. (a) Any Lender may, with the
written consent of the Company at all times other than during the existence of
an Event of Default and the Administrative Agent, which consents shall not be
unreasonably withheld, at any time assign and delegate to one or more Eligible
Assignees (provided that no written consent of the
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Company, or the Administrative Agent shall be required in connection with an
assignment and delegation by BofA or DLJ or in connection with any assignment
and delegation by a Lender to an Eligible Assignee that is an Affiliate of such
Lender) (each an "Assignee") all, or any part of all, of the Loans, the
Revolving Commitment, the L/C Obligations and the other rights and obligations
of such Lender hereunder, in a minimum amount of $5,000,000 (provided that no
minimum amount shall be applicable to any assignment and delegation to an
existing Lender or an Affiliate of a Lender or to an assignment of the entire
remaining amount of the Loans and Commitment of a Lender) provided, however,
that the Company and the Administrative Agent may continue to deal solely and
directly with such Lender in connection with the interest so assigned to an
Assignee until (i) written notice of such assignment, together with payment
instructions, addresses and related information with respect to the Assignee,
shall have been given to the Company and the Administrative Agent by such Lender
and the Assignee; (ii) such Lender and its Assignee shall have delivered to the
Company and the Agent an Assignment and Acceptance substantially in the form of
Exhibit G ("Assignment and Acceptance"), together with any Note or Notes subject
to such assignment, (iii) the assignor Lender or Assignee has paid to the
Administrative Agent a processing fee in the amount of $3,000 and (iv) the
information in the Assignment and Acceptance is recorded in the Register
pursuant to subsection (d) hereof.
(b) From and after the date that the Administrative Agent notifies
the assignor Lender that it has received (and provided its consent with respect
to) an executed Assignment and Acceptance and payment of the above-referenced
processing fee and it has recorded the information in the Register, (i) the
Assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, shall have the rights and obligations of a Lender under the Loan
Documents and (ii) the assignor Lender shall, to the extent that rights and
obligations hereunder and under the other Loan Documents have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.
(c) Within five Business Days after its receipt of notice by the
Administrative Agent that it has received an executed Assignment and Acceptance
and payment of the processing fee (and provided that it consents to such
assignment in accordance with subsection 12.8(a)), the Company shall execute and
deliver to the Administrative Agent, new Notes evidencing such Assignee's
assigned Loans and Commitment and, if the assignor Lender has retained a portion
of its Loans and its Commitments, replacement Notes in the principal amount of
the Loans retained by the assignor Lender (such Notes to be in exchange for, but
not in payment of, the Notes held by such Lender). Immediately upon each
Assignee making its processing fee payment under the Assignment and Acceptance,
this Agreement shall be deemed to be amended to the extent, but only to the
extent, necessary to reflect the addition of the Assignee and the resulting
adjustment of the Commitments arising therefrom. The Commitment allocated to
each Assignee shall reduce such Commitments of the assigning Lender pro tanto.
(d) The Company hereby designates the Administrative Agent to serve
as the Company's agent, solely for purposes of this Section 12.8(d), to maintain
a register (the
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"Register") on which it will record the Commitments from time to time of each of
the Lenders, the address and any U.S. federal taxpayers identification number of
each Lender, the Loans made by each of the Lenders and each repayment in respect
of the principal amount of the Loans of each Lender. Failure to make any such
recordation, or any error in such recordation shall not affect Lender's
obligations in respect of such Loans. With respect to any Lender, the transfer
of the Commitments of such Lender and the rights to the principal of, and
interest on, any Loan made pursuant to such Commitments shall not be effective
until such transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Commitments and loans and prior to such
recordation all amounts owing to the transferor with respect to such Commitments
and Loans shall remain owing to the transferor. The registration of assignment
or transfer of all or part of any Commitments and Loans shall be recorded by the
Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Acceptance pursuant to this Section 12.8. Coincident with the delivery of such
an Assignment and Acceptance to the Administrative Agent for acceptance and
registration of assignment or transfer of all or part of a Loan, or as soon
thereafter as practicable, the assigning or transferor Lender shall surrender
the Note evidencing such Loan, and thereupon one or more new Notes in the same
aggregate principal amount shall be issued to the assigning or transferor Lender
and/or the new Lender. The Company agrees to indemnify the Administrative Agent
from and against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its duties under this Section 12.8(d).
(e) Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Lender and the other interests of
that Lender (the "originating Lender") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii) the
Company, the Issuing Lender and the Administrative Agent shall continue to deal
solely and directly with the originating Lender in connection with the
originating Lender's rights and obligations under this Agreement and the other
Loan Documents and (iv) no Lender shall transfer or grant any participating
interest under which the Participant has rights to approve any amendment to, or
any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment, consent or waiver would require
unanimous consent of the Lenders as described in the first proviso to Section
12.1. In the case of any such participation, the Participant shall be entitled
to the benefit of Sections 4.1, 4.3 and 12.5 as though it were also a Lender
hereunder, and if amounts outstanding under this Agreement are due and unpaid,
or shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set-off 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.
(f) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and
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interest in this Agreement and the Note held by it in favor of any Federal
Reserve Bank in accordance with Regulation A of the FRB or U.S. Treasury
Regulation 31 CFR Section 203.14, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.
12.9 Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Company and provided to it by the Company or any Subsidiary, or
by the Administrative Agent on such Company's or Subsidiary's behalf, under this
Agreement or any other Loan Document, and neither it nor any of its Affiliates
shall use any such information other than in connection with or in enforcement
of this Agreement and the other Loan Documents or in connection with other
business now or hereafter existing or contemplated with the Company or any
Subsidiary; except to the extent such information (i) was or becomes generally
available to the public other than as a result of disclosure by the Lender, or
(ii) was or becomes available on a non-confidential basis from a source other
than the Company, provided that such source is not bound by a confidentiality
agreement with the Company known to the Lender; provided, however, that any
Lender may disclose such information (A) at the request or pursuant to any
requirement of the National Association of Insurance Commissioners or any
Governmental Authority to which the Lender is subject or in connection with an
examination of such Lender by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the Agent, any
Lender or their respective Affiliates may be party; (E) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document; (F) to such Lender's independent auditors and other
professional advisors; (G) to any Participant or Assignee, actual or potential,
provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Lenders hereunder; (H) as to any
Lender or its Affiliate, as expressly permitted under the terms of any other
document or agreement regarding confidentiality to which the Company or any
Subsidiary is party or is deemed party with such Lender or such Affiliate; and
(I) to its Affiliates.
12.10 Set-off. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Company, any such notice being waived by the Company
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held by, and other indebtedness at any time owing by, such Lender to or for the
credit or the account of the Company against any and all Obligations owing to
such Lender, now or hereafter existing, irrespective of whether or not the Agent
or such Lender shall have made demand under this Agreement or any Loan Document
and although such Obligations may be contingent or unmatured. Each Lender agrees
promptly to notify the Company and the Administrative Agent after any such
set-off and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application.
99
106
12.11 Automatic Debits of Fees. With respect to any commitment fee,
arrangement fee, letter of credit fee or other fee, or any other cost or expense
(including Attorney Costs) due and payable to the Administrative Agent, the
Issuing Lender, BofA or the Arranger under the Loan Documents, the Company
hereby irrevocably authorizes BofA to debit any deposit account of the Company
with BofA in an amount such that the aggregate amount debited from all such
deposit accounts does not exceed such fee or other cost or expense. If there are
insufficient funds in such deposit accounts to cover the amount of the fee or
other cost or expense then due, such debits will be reversed (in whole or in
part, in BofA's sole discretion) and such amount not debited shall be deemed to
be unpaid. No such debit under this Section shall be deemed a set-off.
12.12 Notification of Addresses, Lending Offices, etc. Each Lender shall
notify the Administrative Agent in writing of any changes in the address to
which notices to the Lender should be directed, of addresses of any Lending
Office, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as the Agent shall
reasonably request.
12.13 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
12.14 Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
12.15 No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of the Company, the Lenders, the
Agents and the Agent-Related Persons, and their permitted successors and
assigns, and no other Person shall be a direct or indirect legal beneficiary of,
or have any direct or indirect cause of action or claim in connection with, this
Agreement or any of the other Loan Documents.
12.16 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
ILLINOIS; PROVIDED THAT THE AGENT, THE LENDERS AND THE BORROWER SHALL RETAIN ALL
RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENTS AND THE LENDERS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENTS AND THE LENDERS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
100
107
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE AGENTS AND
THE LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
12.17 Waiver of Jury Trial. THE COMPANY, THE LENDERS AND THE AGENTS EACH
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
LENDERS AND THE AGENTS EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL
BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
12.18 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Lenders and the Agents, and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written, relating to
the subject matter hereof and thereof.
101
108
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.
AMERISERVE FOOD DISTRIBUTION, INC.
By: /s/ Donald J. Rogers
-----------------------------------------
Donald J. Rogers
Title: CFO
109
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Administrative
Agent
By: /s/ William J. Stafeil
-----------------------------------------
William J. Stafeil
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Issuing Lender
By: /s/ William J. Stafeil
-----------------------------------------
William J. Stafeil
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as a Lender
By: /s/ William J. Stafeil
-----------------------------------------
William J. Stafeil
Title: Vice President
110
CREDIT LYONNAIS CHICAGO BRANCH,
as a Lender
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title: Vice President
111
CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC.
As: Attorney-in-Fact and on behalf of First
Allmerica Financial Life Insurance
Company
By: /s/ John W. Fraser
-----------------------------------------
Name: John W. Fraser
Title: Managing Director
112
ORIX USA Corporation, as a Lender
By: /s/ Hiroyuki Miyauchi
-----------------------------------------
Hiroyuki Miyauchi
Title: Executive Vice President
113
TRANSAMERICA BUSINESS CREDIT
CORPORATION, as a Lender
By: /s/ Terrell W. Harm
-----------------------------------------
Title: Vice President
114
PRIME INCOME TRUST, as a Lender
By: /s/ Rafael Scolari
-----------------------------------------
Rafael Scolari
Title: V.P. Portfolio Manager
115
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., NEW YORK BRANCH, as a Lender
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title: Joint General Manager
116
FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
Management Inc., as attorney in
fact
By: /s/ Stephen M. [ILLEGIBLE]
-----------------------------------------
Title: Managing Director
117
NATEXIS BANQUE, as a Lender
By: /s/ G. K. DOOLEY
-----------------------------------------
Kevin Dooley
Title: Vice President
By: /s/ William C. Maier
-----------------------------------------
WILLIAM C. MAIER
Title: VP-GROUP MANAGER
118
ROYALTON COMPANY, as a Lender
By: Pacific Investment Management
Company, as its Investment Advisor
By: /s/ Raymond Kennedy
-----------------------------------------
Raymond Kennedy
Title: Vice President
Address:
Royalton Company
c/o Pacific Investment Management
Company
840 Newport Beach, CA 92658
Attn: Raymond Kennedy
Telephone: (714) 717-7363
Facsimile: (714) 640-3419
119
THE DAI-ICHI KANGYO BANK, LTD.,
CHICAGO BRANCH, as a Lender
By: /s/ Mikio Nishimura
-----------------------------------------
Mikio Nishimura
Title: General Manager
120
THE MITSUBISHI TRUST AND BANKING
CORPORATION, CHICAGO BRANCH
as a Lender
By: /s/ Masaaki Yamagishi
-----------------------------------------
Masaaki Yamagishi
Title: Chief Manager
121
BankBoston, N.A.
as a Lender
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title: Division Executive
122
FLEET NATIONAL BANK,
as a Lender
By: /s/
-----------------------------------------
Title: Senior Vice President
123
VAN KAMPEN AMERICAN CAPITAL PRIME RATE
INCOME TRUST, as a Lender
By: /s/ Jeffrey W. Maillet
-----------------------------------------
Jeffrey W. Maillet
Title: Sr. Vice Pres. - Portfolio Mgr.
124
METROPOLITAN LIFE INSURANCE COMPANY,
as a Lender
By: /s/ James R. [ILLEGIBLE]
-----------------------------------------
Title: Assistant Vice President
125
CHRISTIANIA BANK OG KREDITKASSE
ASA, as a Lender
By: /s/ William S. Phillips /s/ Peter M. Dodge
------------------------------------------
William S. Phillips Peter M. Dodge
Title: Vice President First Vice President
126
NATIONAL WESTMINSTER BANK PLC,
as a Lender
By: /s/ Stefanie Warner - Grise
-----------------------------------------
Title: Vice President
127
BANK ONE, WISCONSIN, as a Lender
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title: V.P.
128
SOUTHERN PACIFIC THRIFT &
LOAN ASSOCIATION, as a Lender
By: /s/ Charles W. Martocano
-----------------------------------------
Title: Senior Vice President
129
HELLER FINANCIAL, INC., as a Lender
By: /s/ Linda W. Wolf
-----------------------------------------
Title: S V P
130
BANK OF TOKYO - MITSUBISHI TRUST
COMPANY, as a Lender
By: /s/ [illegible]
-----------------------------------------
Title: Vice President
131
NORTHERN LIFE INSURANCE COMPANY
By: ING Capital Advisors, Inc.,
as Investment Advisor
By: /s/ Michael D. Hatley
-----------------------------------------
Michael D. Hatley
Title: Vice President & Portfolio Manager
132
OCTAGON CREDIT INVESTORS LOAN
PORTFOLIO (a Unit of The Chase
Manhattan Bank), as a Lender
By: /s/ Ronald W. Stewart
-----------------------------------------
Ronald W. Stewart
Title: Managing Director
133
MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, as a Lender
By: /s/ John B. Wheeler
-----------------------------------------
Title: Managing Director
134
THE FIRST NATIONAL BANK OF CHICAGO,
as a Lender
By: /s/ J. Bowne
-----------------------------------------
Title: Authorized Agent
135
THE FUJI BANK, LIMITED,
as a Lender
By: /s/ Tetsuo Kamatsu
-----------------------------------------
Tetsuo Kamatsu (K-219)
Title: Joint General Manager
136
THE SUMITOMO BANK, LIMITED,
CHICAGO BRANCH, as a Lender
By: /s/ John H. Kemper
-----------------------------------
Title: Senior Vice President
137
PILGRIM AMERICA PRIME RATE TRUST,
as a Lender
By: /s/ Michael J. Bacevich
-----------------------------------
Michael J. Bacevich
Title: Vice President
138
DEEPROCK & COMPANY, as a Lender
By: Eaton Vance Management
as Investment Advisor
/s/ Payson F. Swaffield
---------------------------------------------
Name: Payson F. Swaffield
Title: Vice President
139
KZH-ING-I CORPORATION
By: /s/ Virginia Conway
-----------------------------------------
Title: Authorized Agent
140
KZH-SOLEIL CORPORATION,
as a Lender
By: /s/ Virginia Conway
-----------------------------------------
Title: Authorized Agent
141
KZH - CRESCENT CORPORATION,
as a Lender
By: /s/ Virginia Conway
-----------------------------------------
Title: Authorized Agent
142
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.
AMERISERVE FOOD DISTRIBUTION, INC.
By: /s/ Donald J. Rogers
-----------------------------------------
Donald J. Rogers
Title: VP
143
DONALDSON LUFKIN & JENRETTE
SECURITIES CORPORATION, as
Documentation Agent
By: /s/ [ILLEGIBLE]
-----------------------------------------
Title:
---------------------------------------
144
CRESCENT - MACH I PARTNERS, L.P.
by: TCW Asset Management Company,
its investment manager
By: /s/ Justin L. Driscoll
-----------------------------------------
Justin L. Driscoll
Title: Senior Vice President
145
Continental Assurance Company
Separate Account (E)
By: TCW Asset Management Company
as Attorney-in-Fact
By: /s/ Mark L. Gold
-----------------------------------------
Name: Mark L. Gold
Title: Managing Director
By: /s/ Justin L. Discoll
-----------------------------------------
Name: Justin L. Discoll
Title: Senior Vice President
146
PPM AMERICA, INC., as attorney in
fact, on behalf of Jackson National
Life Insurance Company
By: /s/ Michael [ILLEGIBLE]
-----------------------------------------
Title: Managing Director