EXHIBIT 10(i)(2)
Execution Copy
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of November 25, 2002 (as amended or
modified from time to time, this "Agreement"), is by and among Universal Forest
Products, Inc., a Michigan corporation (the "Company"), the Canadian Borrower,
the lenders party hereto from time to time (the "Lenders"), Bank One, NA, a
national banking association having its principal office in Chicago, Illinois,
as Agent, Wachovia Bank, N.A., as syndication agent (in such capacity, together
with its successors and assigns, the "Syndication Agent") and Standard Federal
Bank, N.A., as documentation agent (in such capacity, together with its
successors and assigns, the "Documentation Agent").
INTRODUCTION
The Borrowers desire to obtain a revolving credit facility, including
letters of credit, in the aggregate principal amount of $200,000,000 in order to
provide funds for working capital and general corporate purposes, with a
sub-limit for Canadian advances to the Canadian Borrower of $15,000,000 and for
bid-option loans of $75,000,000, and the Lenders are willing to establish such
credit facilities in favor of the Borrowers on the terms and conditions herein
set forth.
In consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Certain Definitions. As used herein the following terms shall have
the following respective meanings:
"Absolute Rate Bid-Option Loan" shall mean a Loan which pursuant to the
applicable Notice of Bid-Option Loan is made at the Bid-Option Absolute Rate.
"Acquisition" shall mean any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Company or any of its Subsidiaries directly or indirectly (i) acquires any going
business or all or substantially all of the assets of any firm, corporation,
partnership, limited liability company or other business entity or other Person,
or division thereof, whether through purchase of assets, merger or otherwise or
(ii) acquires (in one transaction or as the most recent transaction in a series
of transactions) at least a majority (in number of votes) of the Capital Stock
of any Person.
"Activated Aggregate Canadian Commitments" is defined in Section
2.1(d).
"Advance" shall mean any Loan and any Letter of Credit Advance.
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"Adjusted Leverage Ratio" shall mean, as of any date, the ratio of (a)
the Total Seasonally Adjusted Debt as of such date to (b) the Total Adjusted
Capitalization as of such date.
"Affiliate" when used with respect to any Person shall mean any other
Person which, directly or indirectly, controls or is controlled by or is under
common control with such Person. For purposes of this definition "control"
(including the correlative meanings of the terms "controlled by" and "under
common control with") with respect to any Person, shall mean possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
Capital Stock or by contract or otherwise. A Person shall be deemed to control
another Person if the controlling Person owns 10% or more of any class of Voting
Stock of the controlled Person.
"Agent" shall mean Bank One, NA in its capacity as contractual
representative of the Lenders pursuant to Article VII, and not in its individual
capacity as a Lender, and any successor Agent appointed pursuant to Article VII,
and for purposes of notices to the Agent from the Canadian Borrower, notices by
the Agent to Canadian Lenders under such sections and such other notices with
respect to the Canadian Borrower or Canadian Lenders as designated by the Agent
from time to time, Agent shall be deemed references to the Agent's Affiliate
Bank One Canada.
"Agent Payment Office" of the Agent shall mean, for each of the Agreed
Currencies, the office, branch, affiliate or correspondent bank of the Agent
specified from time to time by the Agent as the "Agent Payment Office" to the
Borrowers and the Lenders for such Agreed Currency.
"Aggregate Available Canadian Commitments" shall mean at any date of
determination with respect to all Canadian Lenders, an amount equal to the
Available Canadian Commitments of all Canadian Lenders on such date.
"Aggregate Available U.S. Commitments" shall mean as at any date of
determination with respect to all Lenders, an amount equal to the Available U.S.
Commitments of all Lenders on such date.
"Aggregate Syndicated Outstandings" shall mean as at any date of
determination with respect to any Lender, the Dollar Equivalent of the sum of
the aggregate unpaid principal amount of such Lender's Syndicated Loans on such
date and the amount of such Lender's Pro Rata Share of Letters of Credit and
Swingline Loans on such date and without duplication the amount of such Lender's
participation in other Syndicated Loans pursuant to Section 2.1(e) on such date.
"Agreed Currencies" shall mean (a) with respect to the Company, U.S.
Dollars; and (b) with respect to the Canadian Borrower, Canadian Dollars.
"Applicable Lending Office" shall mean, with respect to any Advance
made by any Lender or with respect to such Lender's Commitment, the Affiliate of
such Lender or the office or branch of such Lender or of any Affiliate of such
Lender located at the address specified as the applicable lending office for
such Lender set forth next to the name of such Lender in the signature pages
hereof or any other office or branch or Affiliate of such Lender or of any
Affiliate of such Lender hereafter selected and notified to the Borrowers and
the Agent by such Lender.
"Applicable Margin" shall mean, with respect to any Eurodollar Rate
Syndicated Loan, BA Rate Syndicated Loan, Letter of Credit fee under Section
2.5(b)(i) and facility fee under Section 2.5(a), as the case may be, the
applicable percentage set forth in the applicable table below based upon the
Adjusted
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Leverage Ratio, as adjusted on the date 50 days after the end of each
fiscal quarter of the Company and shall remain in effect until the next change
to be effected pursuant to this definition, based upon the Adjusted Leverage
Ratio as of the last day of the most recently ended fiscal quarter; provided,
however, (i) until the Applicable Margin is adjusted for the first time based on
the Adjusted Leverage Ratio as of the end of the first fiscal quarter ending
after the Effective Date, the Applicable Margin shall be set at Level III, and
(ii) upon the occurrence and during the continuance of any Default or Event of
Default, the Applicable Margin shall be the highest Applicable Margin set forth
in the table below:
<Table>
<Caption>
APPLICABLE MARGIN
---------------------------------------------------------
Eurodollar Rate Syndicated
BA Rate Syndicated
Level Adjusted Leverage Ratio Loan and Letter of Credit Fee Facility Fee
- ----- ------------------------------------- ----------------------------- -----------------
I < or = 0.35 to 1.0 70 basis points 17.5 basis points
II > 0.35 to 1.0 and < or = 0.425 to 1.0 80 basis points 20.0 basis points
III > 0.425 to 1.0 and < or = 0.50 to 1.0 102.5 basis points 22.5 basis points
IV > 0.50 to 1.0 and < or = 0.55 to 1.0 125 basis points 25.0 basis points
V > 0.55 to 1.0 140 basis points 35.0 basis points
</Table>
"Arranger" shall mean Banc One Capital Markets, Inc., a Delaware
corporation, and its successors.
"Assignment and Acceptance" is defined in Section 8.6(d).
"Available Canadian Commitment" shall mean at any date of determination
with respect to any Canadian Lender (after giving effect to the making and
payment of any Loans required on such date pursuant to Section 2.6(g)), the
lesser of (a) the excess, if any, of (i) the Dollar Equivalent of such Canadian
Lender's Canadian Commitment in effect on such date over (ii) the aggregate
Canadian Syndicated Loans of such Canadian Lender on such date and (b) the
Available U.S. Commitment of such Lender on such date.
"Available U.S. Commitment" shall mean at any date of determination
with respect to any Lender (after giving effect to the making and payment of any
Loans required on such date pursuant to Section 2.6(g)), an amount in Dollars
equal to the excess, of (a) the amount of such Lender's U.S. Commitment in
effect on such date over (b) the Aggregate Syndicated Outstandings of such
Lender on such date.
"BA Interest Period" shall mean, relative to any BA Rate Syndicated
Loan, the period beginning on (and including) the date on which such BA Rate
Syndicated Loan is made or continued to (but excluding) the date which is one,
two, three, or six months thereafter or such other period of time agreed to by
the Canadian Lenders, as the Canadian Borrower may elect under Section 2.6, and
each subsequent period commencing on the expiry of the immediately preceding BA
Interest Period and ending on the date one, two, three, or six months (or such
other period acceptable to the Canadian Borrower and the Canadian Lenders)
thereafter, as the Canadian Borrower may elect under Section 2.6, provided,
however, that (a) each BA Interest Period which would otherwise end on a day
which is not a Business Day shall end on the
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next succeeding Business Day, and (b) no BA Interest Period shall be permitted
which would end after the Termination Date.
"BA Rate" shall mean with respect to a BA Rate Syndicated Loan for the
relevant BA Interest Period, the sum of (a) the Applicable Margin plus (b) the
bid rate quoted by Bank One Canada for its own acceptances for the relevant BA
Interest Period as of the first day of such BA Interest Period.
"BA Rate Syndicated Loan" shall mean any Syndicated Loan which bears
interest at the BA Rate.
"Bank One" shall mean Bank One, NA, , a national banking association
having its principal office in Chicago, Illinois, in its individual capacity,
and its successors.
"Bank One Canada" shall mean Bank One, NA, Canada Branch and any other
successor or assignee thereof which is a branch or Affiliate of Bank One.
"Bid-Option Absolute Rate" shall mean, with respect to any Absolute
Rate Bid-Option Loan, the Bid-Option Absolute Rate, as defined in Section
2.2(d)(ii)(E), that is offered for such Loan.
"Bid-Option Auction" shall mean a solicitation of Bid-Option Quotes
setting forth Bid-Option Absolute Rates or Bid-Option Eurodollar Rate Margins,
as the case may be, pursuant to Section 2.2(b).
"Bid-Option Eurodollar Rate" shall mean the sum of (a) the Bid-Option
Eurodollar Rate Margin plus (b) the Eurodollar Base Rate.
"Bid-Option Eurodollar Rate Margin" shall mean, with respect to any
Eurodollar Rate Bid-Option Loan, the Bid-Option Eurodollar Rate Margin, as
defined in Section 2.2(d)(ii)(F), that is offered for such Loan.
"Bid-Option Interest Period" shall mean (a) with respect to each
Eurodollar Rate Bid Option Borrowing, the Eurodollar Rate Interest Period
applicable thereto, and (b) with respect to each Absolute Rate Bid Option
Borrowing, the period commencing on the date of such Borrowing and ending on the
date elected by the Company in the applicable Notice of Borrowing, which date
shall be not less than 15 days and not more than 180 days after the date of such
Bid-Option Loan; provided that:
(i) any such Interest Period that would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding
Business day; and
(ii) no such Interest Period that would end after the Termination
Date shall be permitted.
"Bid-Option Loan" shall mean a Loan which is made by a Lender pursuant
to a Bid-Option Auction.
"Bid-Option Note" shall mean a promissory note of the Company in
substantially the form of Exhibit A hereto evidencing the obligation of the
Company to repay Bid-Option Loans, as amended or modified from time to time and
together with any promissory note or notes issued in exchange or replacement
therefor.
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"Bid-Option Percentage" shall mean, with respect to any Lender, the
percentage of the aggregate outstanding principal amount of the Bid-Option Loans
of all the Lenders represented by the outstanding principal amount of the
Bid-Option Loans of such Lender.
"Bid-Option Quote" shall mean an offer by a Lender to make a Bid-Option
Loan in accordance with Section 2.2(d).
"Bid-Option Quote Request" shall mean a Bid-Option Quote Request in the
form referred to in Section 2.2(b).
"Borrowers" shall mean the Company and the Canadian Borrower.
"Borrowing" shall mean the aggregation of Advances made to the
Borrowers, or continuations and conversions of such Advances, made pursuant to
Article II on a single date and for a single Interest Period. A Borrowing may be
referred to for purposes of this Agreement by reference to the type of Loan
comprising the relating Borrowing, e.g., a "Floating Rate Borrowing" if such
Loans are Floating Rate Loans, a "Eurodollar Rate Syndicated Borrowing" if such
Loans are Eurodollar Rate Syndicated Loans, a "BA Rate Syndicated Borrowing" if
such Loans are BA Rate Syndicated Loans, an "Absolute Rate Bid-Option Borrowing"
if such Loans are Absolute Rate Bid-Option Loans, or a "Eurodollar Rate
Bid-Option Borrowing" if such Loans are Eurodollar Rate Bid-Option Loans.
Floating Rate Borrowings, BA Rate Syndicated Loans and Eurodollar Rate
Syndicated Borrowings may be similarly collectively referred to as "Syndicated
Borrowings", and Absolute Rate Bid-Option Borrowings and Eurodollar Rate
Bid-Option Borrowings may be collectively referred to as "Bid-Option
Borrowings".
"Business Day" shall mean (a) a day other than a Saturday, Sunday or
other day on which the Agent is not open to the public for carrying on
substantially all of its banking functions, (b) with respect to any Eurodollar
Rate Loan, a day which is both a Business Day and a day on which dealings in
U.S. Dollar deposits are carried out in the relevant interbank market and (c)
with respect to any BA Rate Syndicated Loan, a day on which commercial banks are
open for foreign exchange business in Canada and dealings in Canadian Dollars
are carried on in the applicable offshore foreign exchange interbank market or
other market in which disbursement of or payment in Canadian Dollars will be
made or received hereunder.
"Canadian Borrower" shall mean Universal Forest Products Nova Scotia
ULC, an unlimited liability company organized under the laws of Nova Scotia, or
such other Subsidiary of the Company which (i) is organized under the laws of
Canada or any political subdivision thereof, (ii) becomes the Canadian Borrower
pursuant to the terms of Section 8.1(d), and (iii) is approved by the Agent.
"Canadian Dollars" or "C$" shall mean the lawful currency of Canada.
"Canadian Lender" shall mean any Lender which has a Canadian
Commitment, provided that such Lender shall make its Canadian Loans through its
Applicable Lending Office designated on the signature pages hereto or otherwise
designated by such Lender from time to time as it Applicable Lending Office in
Canada.
"Canadian Commitment" shall mean, as to any Canadian Lender at any
time, its obligation to make Canadian Syndicated Loans to the Canadian Borrower
under Section 2.1(b) in an aggregate U.S. Dollar amount not to exceed at any
time the amount set forth opposite such Lender's name on the
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signature pages hereof under the heading "Canadian Commitment" or as otherwise
established pursuant to Section 8.6, as such amount may be modified from time to
time pursuant to the provisions hereof.
"Canadian Syndicated Loans" shall mean Syndicated Loans made to the
Canadian Borrower under Section 2.1(b).
"Capital Lease" of any Person shall mean any lease which, in accordance
with Generally Accepted Accounting Principles, is or should be capitalized on
the books of such Person.
"Capital Stock" shall mean (i) in the case of any corporation, all
capital stock and any securities exchangeable for or convertible into capital
stock and any warrants, rights or other options to purchase or otherwise acquire
capital stock or such securities or any other form of equity securities, (ii) in
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, (iii) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (iv) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distribution of assets of, the issuing
Person.
"Cash Equivalent" shall mean (i) cash in U.S. Dollars, (ii) cash in
Canadian Dollars, (iii) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or instrumentality thereof
having maturities of not more than six months from the date of acquisition, (iv)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Moody's, (v) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any Lender or with any domestic
commercial bank having capital and surplus in excess of $250,000,000 and a Keefe
Bank Watch Rating of "B" or better, (vi) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clauses (iii), (iv), and (v) above entered into with any financial institution
meeting the qualifications specified in clause (v) above, (vii) commercial paper
having one of the two highest ratings obtained from Moody's or S&P and in each
case maturing within six months after the date of acquisition and (viii)
investments in money market funds which invest substantially all their assets in
securities of the type described in clauses (i) through (vii) above.
"Change of Control" shall mean (i) the acquisition by any Person, or
two or more Persons acting in concert, of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934) of 25% or more of the outstanding shares of
voting Capital Stock of the Company, other than any such acquisition by Peter
Secchia, Carroll M. Shoffner or any Person wholly owned and controlled, free and
clear of any Liens, by Peter Secchia and/or Carroll M. Shoffner; (ii) any Person
or two or more Persons acting in concert shall have acquired, by contract or
otherwise, or shall have entered into a contract or arrangement that, upon
consummation, will result in its or their acquisition of the power to exercise,
directly or indirectly, a controlling influence over the management or policies
of the Company; (iii) Continuing Directors shall cease to constitute at least a
majority of the directors constituting the board of directors of the Company; or
(iv) the occurrence of any "Change of Control" or similar term as defined in any
agreement or instrument relating to the Senior Note Debt.
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"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations thereunder.
"Commitments" shall mean the Canadian Commitments and the U.S.
Commitments.
"Consolidated" or "consolidated" shall mean, when used with reference
to any financial term in this Agreement, the aggregate for two or more Persons
of the amounts signified by such term for all such Persons determined on a
consolidated basis in accordance with Generally Accepted Accounting Principles.
"Contingent Liabilities" of any Person shall mean, as of any date, all
obligations of such Person or of others for which such Person is contingently
liable, as obligor, guarantor, surety or in any other capacity, or in respect of
which obligations such Person assures a creditor against loss or agrees to take
any action to prevent any such loss (other than endorsements of negotiable
instruments for collection in the ordinary course of business), including
without limitation all reimbursement obligations of such Person in respect of
any letters of credit, surety bonds or similar obligations and all obligations
of such Person to advance funds to, or to purchase assets, property or services
from, any other Person in order to maintain the financial condition of such
other Person.
"Continuing Directors" shall mean as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the Effective Date or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Default" shall mean any of the events or conditions described in
Section 6.1 which will become an Event of Default with notice or lapse of time
or both.
"Defaulting Lender" shall mean any Lender that fails to make available
to the Agent such Lender's Loans required to be made hereunder or shall have not
made a payment required to be made to the Agent hereunder. Once a Lender becomes
a Defaulting Lender, such Lender shall continue as a Defaulting Lender until
such time as such Defaulting Lender makes available to the Agent the amount of
such Defaulting Lender's Loans and all other amounts required to be paid to the
Agent pursuant to this Agreement.
"Documentation Agent" is defined in the first paragraph of this
Agreement.
"Disqualified Stock" shall mean any Capital Stock that, by its terms
(or by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part.
"Domestic Subsidiary" shall mean each present and future Subsidiary of
the Company which is not a Foreign Subsidiary.
"EBIT" shall mean, for any period, Net Income for such period plus all
amounts deducted in determining such Net Income on account of (a) Total Interest
Expense and (b) income taxes, and (c) any one-time non-cash charges related to
Financial Accounting Standards 141 or 142, all as determined for the Company and
its Subsidiaries on a consolidated basis in accordance with Generally Accepted
Accounting Principles.
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"Effective Date" shall mean the effective date specified in the final
paragraph of this Agreement.
"Environmental Laws" at any date shall mean all provisions of law,
statute, ordinances, rules, regulations, judgments, writs, injunctions, decrees,
orders, awards and standards which are applicable to the Company or any
Subsidiary and promulgated by the government of the United States of America or
any foreign government or by any state, province, municipality or other
political subdivision thereof or therein or by any court, agency,
instrumentality, regulatory authority or commission of any of the foregoing
concerning the protection of, or regulating the discharge of substances into,
the environment.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations thereunder.
"ERISA Affiliate" shall mean, with respect to any Person, any trade or
business (whether or not incorporated) which, together with such Person or any
Subsidiary of such Person, would be treated as a single employer under Section
414 of the Code.
"Eurodollar Base Rate" applicable to any Eurodollar Interest Period
shall mean, the rate per annum obtained by dividing (a) the per annum rate of
interest determined by the Agent at which deposits in U.S. Dollars for such
Eurodollar Interest Period and in an aggregate amount comparable to (i) in the
case of Eurodollar Rate Syndicated Loans, the amount of the related Eurodollar
Rate Syndicated Loan to be made by the Agent in its capacity as a Lender
hereunder and (ii) in the case of Eurodollar Rate Bid-Option Loans, the
aggregate amount of the Eurodollar Rate Bid-Option Borrowing set forth in the
related Bid-Option Quote Request, are offered to the Agent by other prime banks
in the applicable interbank market selected by the Agent in its reasonable
discretion, at approximately 11:00 a.m. London time, on the second Business Day
prior to the first day of such Eurodollar Interest Period by (b) an amount equal
to one minus the stated maximum rate (expressed as a decimal) of all reserve
requirements including, without limitation, any marginal, emergency,
supplemental, special or other reserves, that is specified on the first day of
such Eurodollar Interest Period by the Board of Governors of the Federal Reserve
System (or any successor agency thereto) or any other governmental authority
(including any nation or government, any political subdivision thereof and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government) having jurisdiction with respect
thereto, for determining the maximum reserve requirement with respect to
eurocurrency funding (currently referred to as "Eurodollar liabilities" in
Regulation D of such Board) maintained by a member bank of such System or
otherwise with respect to determining reserves or similar amounts; all as
conclusively determined by the Agent, absent manifest error, such sum to be
rounded up, if necessary, to the nearest whole multiple of one sixteenth of one
percent (1/16 of 1%).
"Eurodollar Interest Period" shall mean, with respect to any Eurodollar
Rate Syndicated Loan, the period commencing on the day such Eurodollar Rate
Syndicated Loan is made or converted to a Eurodollar Rate Syndicated Loan and
ending on the date one, two, three or six months thereafter or such other period
of time agreed to by the Lenders, as the Company may elect under Section 2.6 or
2.9, and each subsequent period commencing on the last day of the immediately
preceding Eurodollar Interest Period and ending on the date one, two, three or
six months thereafter, as the Company may elect under Section 2.6 or 2.9, and
with respect to any Eurodollar Rate Bid-Option Loan, the period commencing on
the date of such Eurodollar Rate Bid-Option Loan and ending on a date between
one month and twelve months thereafter, as the Company may elect in the Notice
of Bid-Option Loan, provided, however, that (a) any Eurodollar Interest Period
which commences on the last Business Day of a calendar month (or on any day for
which there is no
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numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent calendar month,
(b) each Eurodollar Interest Period which would otherwise end on a day which is
not a Business Day shall end on the next succeeding Business Day or, if such
next succeeding Business Day falls in the next succeeding calendar month, on the
next preceding Business Day, and (c) no Eurodollar Interest Period which would
end after the Termination Date shall be permitted.
"Eurodollar Rate Loan" shall mean any Eurodollar Rate Bid-Option Loan
or Eurodollar Rate Syndicated Loan.
"Eurodollar Rate Bid-Option Loan" shall mean a Bid-Option Loan which
pursuant to the applicable Notice of Bid-Option Loan is made at the Bid-Option
Eurodollar Rate.
"Eurodollar Rate Syndicated Loan" shall mean any Syndicated Loan which
bears interest at the Syndicated Eurodollar Rate.
"Event of Default" shall mean any of the events or conditions described
in Section 6.1.
"Existing Letters of Credit" shall mean the letters of credit
outstanding on the Effective Date and listed on Schedule 1 hereto.
"Federal Funds Rate" shall mean, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Detroit
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Financial Contract" of a Person shall mean (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any Rate Hedging Agreement.
"Fixed Rate Loan" shall mean any Eurodollar Rate Syndicated Loan, any
BA Rate Syndicated Loan, or any Bid-Option Loan.
"Floating Rate" shall mean for any day, a rate per annum equal to (i)
with respect to Loans to the Company, the higher of the Prime Rate for such day
and the sum of the Federal Funds Effective Rate for such day plus 1/2% per annum
and (ii) with respect to Loans to the Canadian Borrower, the Prime Rate for such
day, in each case changing when and as the Prime Rate or the Federal Funds
Effective Rate changes, as applicable.
"Floating Rate Loan" shall mean any Syndicated Loan which bears
interest at the Floating Rate.
"Foreign Subsidiary" shall mean any Subsidiary incorporated or formed
in any jurisdiction other than any State of the United States of America.
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"Generally Accepted Accounting Principles" shall mean generally
accepted accounting principles in effect from time to time and applied on a
basis consistent with that reflected in the financial statements referred to in
Section 4.6.
"Guaranties" shall mean the guaranties entered into by each of the
Guarantors for the benefit of the Agent and the Lenders pursuant to Section
5.1(f) in substantially the form of Exhibit B hereto or other form approved by
the Agent, as amended or modified from time to time.
"Guarantor" shall mean (a) with respect to the Company, each present
and future Domestic Subsidiary of the Borrowers which is required to execute a
Guaranty pursuant to this Agreement, and each Person otherwise entering into a
Guaranty from time to time and (b) with respect to the Canadian Borrower, the
Company, each present and future Domestic Subsidiary of the Borrowers which is
required to execute a Guaranty pursuant to this Agreement, and each Person
otherwise entering into a Guaranty from time to time.
"Indebtedness" of any Person shall mean, as of any date, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person as lessee under any Capital Lease, (c) the unpaid purchase price for
goods, property or services acquired by such Person, except for accounts payable
and other accrued liabilities arising in the ordinary course of business which
are not materially past due, (d) all obligations of such Person to purchase
goods, property or services where payment therefor is required regardless of
whether delivery of such goods or property or the performance of such services
is ever made or tendered (generally referred to as "take or pay contracts"),
other than obligations incurred in the ordinary course of business, (e) all
obligations of such Person in respect of any Financial Contract (valued in an
amount equal to the highest termination payment, if any, that would be payable
by such Person upon termination for any reason on the date of determination),
(f) to the extent not included in the foregoing, obligations and liabilities
which would be classified as part of Total Debt, and (g) all obligations of
others similar in character to those described in clauses (a) through (f) of
this definition for which such Person is contingently liable, as obligor,
guarantor, surety or in any other capacity, or in respect of which obligations
such Person assures a creditor against loss or agrees to take any action to
prevent any such loss (other than endorsements of negotiable instruments for
collection in the ordinary course of business), including without limitation all
reimbursement obligations of such Person in respect of letters of credit, surety
bonds or similar obligations and all obligations of such Person to advance funds
to, or to purchase assets, property or services from, any other Person in order
to maintain the financial condition of such other Person.
"Intercreditor Agreement" shall mean the Intercreditor Agreement dated
as of November 13, 1998 among the Creditors (as defined therein) of the Company
and Bank One, NA (as successor by merger with Bank One, Michigan, formerly known
as NBD Bank), as Collateral Agent, as amended or modified from time to time,
under which agreement the Lenders, the Agent and the Senior Note Holders agree
to share equally and ratably in any proceeds realized from the enforcement of
any guarantees from the Company and any Subsidiaries of the Company and any
pledges of any Capital Stock of any Foreign Subsidiaries which guarantee or
secure, as the case may be, the Lender Obligations, the Senior Note Debt and the
other Subject Obligations, provided that such Intercreditor Agreement, and any
amendments or modifications thereto, shall be in form and substance acceptable
to the Required Lenders and the Agent.
"Interest Coverage Ratio" shall mean, as of the last day of any fiscal
quarter of the Company, the ratio of (a) EBIT to (b) Total Interest Expense, in
each case as calculated for the four consecutive fiscal quarters then ending,
all as determined in accordance with Generally Accepted Accounting Principles.
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"Interest Payment Date" shall mean (a) with respect to any Eurodollar
Rate Loan, BA Rate Syndicated Loan, or Bid-Option Loan, the last day of each
Interest Period with respect to such Eurodollar Rate Loan, BA Rate Syndicated
Loan, or Bid-Option Loan and, in the case of any Interest Period exceeding three
months, those days that occur during such Interest Period at intervals of three
months after the first day of such Interest Period, and (b) in all other cases,
the last Business Day of each March, June, September and December occurring
after the date hereof, commencing with the first such Business Day occurring
after the date of this Agreement.
"Interest Period" shall mean any Eurodollar Interest Period, BA
Interest Period, or Bid-Option Interest Period.
"Invitation for Bid-Option Quotes" shall mean an invitation for
Bid-Option Quotes in the form referred to in Section 2.2(c).
"Lender Obligations" shall mean all indebtedness, obligations and
liabilities, whether now owing or hereafter arising, direct, indirect,
contingent or otherwise, of the Borrowers to the Agent or any Lender pursuant to
the Loan Documents.
"Letters of Credit" shall mean (i) each Existing Letter of Credit
having a stated expiry date not later than the fifth Business Day before the
Termination Date and (ii) each standby letter of credit having a stated expiry
date not later than one year from the issuance thereof and in no event after the
fifth Business Day before the Termination Date issued by the Agent hereunder on
behalf of the Lenders for the account of the Company under an application and
related documentation acceptable to the Agent requiring, among other things,
immediate reimbursement by the Company to the Agent in respect of all drafts or
other demand for payment honored thereunder and all expenses paid or incurred by
the Agent relative thereto.
"Letter of Credit Advances" shall mean each Existing Letter of Credit
and each issuance of a Letter of Credit under Section 2.6 made pursuant to
Section 2.1 in which each Lender acquires a pro rata risk participation pursuant
to Section 2.6(f).
"Letter of Credit Documents" shall have the meaning ascribed thereto in
Section 3.3(b).
"Lien" shall mean any pledge, assignment, deed of trust, hypothecation,
mortgage, security interest, conditional sale or title retaining contract, or
any other type of lien, charge, encumbrance or other similar claim or right.
"Loan" shall mean any Syndicated Loan, Swingline Loan, or any
Bid-Option Loan, as the context may require.
"Loan Documents" shall mean this Agreement, the Notes, the Letter of
Credit Documents, the Guaranties, the Pledge Agreements, the Intercreditor
Agreement, any Rate Hedging Agreements between the Company or any of its
Subsidiaries and any Lender and any other agreement, instrument or document
executed at any time in connection with this Agreement.
"Material Adverse Effect" shall mean (i) a material adverse effect on
the property, business, operations, financial condition, liabilities, prospects
or capitalization of the Company and its Subsidiaries, taken as a whole or (ii)
a material adverse effect on the ability of a Borrower or any Guarantor to
perform its obligations under the Loan Documents.
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"Moody's" shall mean Moody's Investors Service, Inc.
"Multiemployer Plan" shall mean any "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA or Section 414(f) of the Code.
"Net Income" shall mean, for any period, the net income (or loss) of
the Company and its Subsidiaries on a consolidated basis for such period taken
as a single accounting period, determined in accordance with Generally Accepted
Accounting Principles; provided that in determining Net Income there shall be
excluded, without duplication: (a) the income of any Person (other than a
Subsidiary of the Company) in which any Person other than the Company or any of
its Subsidiaries has a joint interest or partnership interest or other ownership
interest, except to the extent of the amount of dividends or other distributions
actually paid to the Company or any of its Subsidiaries by such Person during
such period, (b) the loss of any Person (other than a Subsidiary of the Company)
in which any Person other than the Company or any of its Subsidiaries has a
joint interest or partnership interest or other ownership interest, except to
the extent such loss is funded by the Company or any of its Subsidiaries during
such period, (c) the income of any Person accrued prior to the date it becomes a
Subsidiary of the Company or is merged into or consolidated with the Company or
any of its Subsidiaries or that Person's assets are acquired by the Company or
any of its Subsidiaries, (d) the proceeds of any insurance policy, other than
proceeds of business interruption insurance to the extent included in net income
under Generally Accepted Accounting Principles and not excluded by any other
exclusion under this definition of Net Income, (e) gains or non-cash losses from
the sale, exchange, transfer or other disposition of property or assets not in
the ordinary course of business of the Company and its Subsidiaries and any
other income of the Company and its Subsidiaries which is not from their
continuing operations, and related tax effects in accordance with Generally
Accepted Accounting Principles, (f) any other extraordinary or non-recurring
gains or non-cash losses of the Company or its Subsidiaries, and related tax
effects in accordance with Generally Accepted Accounting Principles, and (g) the
income of any Subsidiary of the Company to the extent that the declaration or
payment of dividends or similar distributions by that Subsidiary of that income
is not at the time permitted by operation of the terms of its charter or of any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary.
"Net Mark-to-Market Exposure" of a Person shall mean, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Rate Hedging Agreements. "Unrealized losses"
means the fair market value of the cost to such Person of replacing such Rate
Hedging Agreement as of the date of determination (assuming the Rate Hedging
Agreement were to be terminated as of that date), and "unrealized profits" means
the fair market value of the gain to such Person of replacing such Rate Hedging
Agreement as of the date of determination (assuming such Rate Hedging Agreement
were to be terminated as of that date).
"Net Worth" shall mean, as of any date, the amount of any capital
stock, paid in capital and similar equity accounts plus (or minus in the case of
a deficit) the capital surplus and retained earnings of the Company and the
Subsidiaries and the amount of any foreign currency translation adjustment
account shown as a capital account of the Company and its Subsidiaries, all on a
consolidated basis in accordance with Generally Accepted Accounting Principles.
"Notes" shall mean the Revolving Credit Notes, the Swingline Loan Note
and the Bid-Option Notes.
"Notice of Bid-Option Loan" shall have the meaning set forth in Section
2.2(f).
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"Obligors" shall mean the Borrowers and the Guarantors.
"Overdue Rate" shall mean (a) in respect of principal of Floating Rate
Loans, a rate per annum that is equal to the sum of two percent (2%) per annum
plus the Floating Rate, (b) in respect of principal of Fixed Rate Loans, a rate
per annum that is equal to the sum of two percent (2%) per annum plus the per
annum rate in effect thereon until the end of the then current Interest Period
for such Loan and, thereafter, a rate per annum that is equal to the sum of two
percent (2%) per annum plus the Floating Rate, and (c) in respect of other
amounts payable by a Borrower hereunder (other than interest), a per annum rate
that is equal to the sum of two percent (2%) per annum plus the Floating Rate.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" shall mean Liens permitted by Section 5.2(d) hereof.
"Person" shall include an individual, a corporation, a limited
liability company, an association, a partnership, a trust or estate, a joint
stock company, an unincorporated organization, a joint venture, a trade or
business (whether or not incorporated), a government (foreign or domestic) and
any agency or political subdivision thereof, or any other entity.
"Plan" shall mean, with respect to any Person, any pension plan (other
than a Multiemployer Plan) subject to Title IV of ERISA or to the minimum
funding standards of Section 412 of the Code which has been established or
maintained by such Person, any Subsidiary of such Person or any ERISA Affiliate,
or by any other Person if such Person, any Subsidiary of such Person or any
ERISA Affiliate could have liability with respect to such pension plan.
"Pledge Agreements" shall mean each pledge agreement entered into by
the Company or any of its Subsidiaries at any time for the benefit of the Agent
and the Lenders pursuant to this Agreement, in form and substance satisfactory
to the Agent, under which any of the Capital Stock of any Foreign Subsidiary is
pledged to the Agent for the benefit of the Agent and the Lenders and subject to
any Intercreditor Agreement, as amended or modified from time to time.
"Prime Rate" shall mean (a) with respect to Loans to the Company, a
rate per annum equal to the prime rate of interest announced or established from
time to time by Bank One or its parent (which is not necessarily the lowest rate
charged to any customer), and (b) with respect to Loans to the Canadian
Borrower, a rate per annum equal to the prime rate announced or established from
time to time by Bank One Canada (which is not necessarily the lowest rate
charged to any customer) plus 1.25%, in each case changing when and as said
prime rate changes.
"Prior Credit Agreement" shall mean that certain Credit Agreement,
dated as of November 13, 1998, among the Company, the lenders party thereto, and
Bank One, NA, successor by merger to Bank One, Michigan, formerly known as NBD
Bank, as agent, as amended or modified from time to time.
"Pro Rata Share" shall mean, for each Lender, the ratio of such
Lender's Commitments to the aggregate Commitments of all Lenders, provided that
(a) with respect to U.S. Syndicated Loans, Letter of Credit Advances and
Swingline Loans and facility fees with respect to the U.S. Commitments and
Section 2.1(e), Pro Rata Share shall mean, for each Lender, the ratio such
Lender's U.S. Commitment bears to the aggregate U.S. Commitments of all Lenders,
and (b) with respect to Canadian Syndicated Loans, Pro Rata
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Share shall mean, for each Lender, the ratio such Lender's Canadian Commitment
bears to the aggregate Canadian Commitments of all Canadian Lenders.
"Prohibited Transaction" shall mean any non-exempt transaction
involving any Plan which is proscribed by Section 406 of ERISA or Section 4975
of the Code.
"Property" of a Person shall mean any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Rate Hedging Agreement" shall mean any transaction (including an
agreement with respect thereto) now existing or hereafter entered by the Company
or any of its Subsidiaries which is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
forward transaction, currency swap transaction, cross-currency rate swap
transaction, currency option or any other similar transaction (including any
option with respect to any of these transactions) or any combination thereof,
whether linked to one or more interest rates, foreign currencies, commodity
prices, equity prices or other financial measures.
"Reportable Event" shall mean a reportable event as described in
Section 4043(b) of ERISA including those events as to which the thirty (30) day
notice period is waived under Part 2615 of the regulations promulgated by the
PBGC under ERISA.
"Required Canadian Lenders" shall mean Canadian Lenders holding at
least 51% of the aggregate Canadian Commitments then outstanding (or at least
51% of the Canadian Syndicated Loans if the Canadian Commitments have been
terminated).
"Required Lenders" shall mean Lenders holding at least 51% of the
aggregate U.S. Commitments then outstanding (or at least 51% of the Advances if
the Commitments have been terminated).
"Revolving Credit Note" shall mean any promissory note of the Company
evidencing the Syndicated Loans, in substantially the form annexed hereto as
Exhibit C, as amended or modified from time to time and together with any
promissory note or notes issued in exchange or replacement therefor.
"Same Day Funds" shall mean (a) with respect to disbursements and
payments in U.S. Dollars, immediately available funds, and (b) with respect to
disbursements and payments in any Canadian Dollars, same day or other funds as
may be determined by the Agent to be customary in the place of disbursement or
payment for the settlement of international banking transactions in Canadian
Dollars.
"S&P" shall mean Standard and Poor's Ratings Services, a division of
The McGraw Hill Companies, Inc.
"Senior Note Debt" shall mean the Subject Obligations under the 7.5%
Senior Notes due May 5, 2004 issued by the Company pursuant to the Note
Agreement among the Company and the holders of such notes dated as of May 1,
1994, the 6.69% Series 1998-A Senior Notes, Tranche A, due December 21, 2005
issued by the Company pursuant to the Note Agreement among the Company and the
holders of such notes dated as of December 1, 1998, the 6.98% Series 1998-A
Senior Notes, Tranche B, due December 21, 2008 issued by the Company pursuant to
the Note Agreement among the Company and the holders of such notes dated as of
December 1, 1998, the 6.98% Series 1998-A Senior Notes, Tranche
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C, due December 21, 2008 issued by the Company pursuant to the Note Agreement
among the Company and the holders of such notes dated as of December 1, 1998 and
each "Successor Note Agreement", as that term is defined in the Intercreditor
Agreement, provided such Subject Obligations are permitted under this Agreement.
"Senior Note Holders" shall mean the holders of the Senior Note Debt.
"Significant Subsidiary" shall mean any one or more Subsidiaries which,
if considered in the aggregate as a single Subsidiary, would be a "significant
subsidiary" as defined in Rule 1-02 of Regulation S-X under the Securities
Exchange Act of 1934.
"Subject Obligations" is defined in the Intercreditor Agreement.
"Subsidiary" of any Person shall mean any other Person (whether now
existing or hereafter organized or acquired) in which (other than directors'
qualifying shares required by law) at least a majority of the Capital Stock of
each class having ordinary voting power or analogous rights (other than Capital
Stock which have such power or right only by reason of the happening of a
contingency), at the time as of which any determination is being made, are
owned, beneficially and of record, by such Person or by one or more of the other
Subsidiaries of such Person or by any combination thereof. Unless otherwise
specified, reference to "Subsidiary" shall mean a Subsidiary of the Company.
"Swingline Facility" shall have the meaning specified in Section
2.1(c).
"Swingline Loan" shall mean any loan evidenced by a Swingline Note and
made by the Agent to the Company pursuant to Section 2.1(c).
"Swingline Note" shall mean any promissory note of the Company
evidencing the Swingline Loans in substantially the form of Exhibit D hereto, as
amended or modified from time to time and together with any promissory note or
notes issued in exchange or replacement therefor.
"Syndicated Advance" shall mean any Syndicated Loan or any Letter of
Credit Advance.
"Syndicated Eurodollar Rate" shall mean, with respect to any Eurodollar
Rate Syndicated Loan for any Eurodollar Rate Interest Period or portion thereof,
the per annum rate that is equal to the sum of (a) the Applicable Margin, plus
(b) the Eurodollar Base Rate; which Syndicated Eurodollar Rate shall change
simultaneously with any change in such Applicable Margin.
"Syndicated Loan" shall mean any borrowing under Section 2.6 evidenced
by the Revolving Credit Notes and made pursuant to Section 2.1.
"Syndication Agent" is defined in the first paragraph of this
Agreement.
"Termination Date" shall mean the earlier to occur of (a) the date
three years after the date hereof and (b) the date on which the Commitments
shall be terminated pursuant to Section 2.4 or 6.2.
"Total Adjusted Capitalization" shall mean, as of any date, the sum of
Net Worth and Total Seasonally Adjusted Debt as of such date.
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"Total Debt" as of any date, shall mean, without duplication, all of
the following for the Company and its Subsidiaries on a consolidated basis: (a)
all Indebtedness for borrowed money and similar monetary obligations evidenced
by bonds, notes, debentures, acceptances, Capital Lease obligations or
otherwise, (b) all liabilities secured by any Lien existing on property owned or
acquired by the Company or any Subsidiary subject thereto, whether or not the
liability secured thereby shall have been assumed; (c) all reimbursement
obligations under outstanding letters of credit (to the extent an underlying
obligation is not accrued or included in Indebtedness), bankers' acceptances or
similar instruments in respect of drafts which (i) may be presented or (ii) have
been presented and have not yet been paid and are not included in clause (a)
above; (d) Net Mark-to-Market Exposure; and (e) all guarantees (other than
guarantees issued by the Borrowers in favor of Subsidiaries to support routine
trade accounts payable and operating lease obligations and excluding guaranties
by Subsidiaries of the Company of the Senior Note Debt) and other Contingent
Liabilities relating to indebtedness, obligations or liabilities of the type
described in the foregoing clauses (a), (b), (c) and (d).
"Total Interest Expense" shall mean, for any period, total interest and
related expense (including, without limitation, that portion of any Capital
Lease obligation attributable to interest expense in conformity with Generally
Accepted Accounting Principles, amortization of debt discount, all capitalized
interest, the interest portion of any deferred payment obligations, all
commissions, discounts and other fees and charges owed with respect to letter of
credit and bankers acceptance financing, the net costs and net payments under
any interest rate hedging, cap or similar agreement or arrangement, prepayment
charges, agency fees, administrative fees, commitment fees and capitalized
transaction costs allocated to interest expense) paid, payable or accrued during
such period, without duplication for any other period, with respect to all
outstanding Indebtedness of the Company and its Subsidiaries, all as determined
for the Company and its Subsidiaries on a consolidated basis for such period in
accordance with Generally Accepted Accounting Principles.
"Total Seasonally Adjusted Debt" shall mean, as of the end of any
fiscal quarter of the Company, the following appropriate amount for such fiscal
quarter end: (a) for any fiscal quarter ending in March or June, 85% of Total
Debt as of the end of such fiscal quarter, and (b) for any fiscal quarter ending
in September or December, 115% of Total Debt as of the end of such fiscal
quarter.
"Transferee" shall have the meaning specified in Section 8.6(i).
"Unfunded Benefit Liabilities" shall mean, with respect to any Plan as
of any date, the amount of the unfunded benefit liabilities determined in
accordance with Section 4001(a)(18) of ERISA.
"U.S. Commitment" shall mean, as to any U.S. Lender at any time, its
obligation to make Syndicated Loans to the Company under Section 2.1(a), and
risk participate in Swingline Loans and Letters of Credit, in an aggregate U.S.
Dollar Amount not to exceed at any time outstanding the U.S. Dollar amount set
forth opposite such Lender's name on the signature pages hereof under the
heading "U.S. Commitment" or as otherwise established pursuant to Section 8.6,
as such amount may be modified from time to time pursuant to the applicable
provisions hereof.
"U.S. Dollar Equivalent" shall mean, with respect to any currency, at
any date, the equivalent thereof in Dollars, calculated on the basis of the
arithmetical mean of the buy and sell spot rates of exchange of the
Administrative Agent for such other currency at 11:00 a.m., London time, on the
date on or as of which such amount is to be determined.
"U.S. Dollars" and "$" shall mean the lawful money of the United States
of America.
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"U.S. Lender" shall mean any Lender which has a U.S. Commitment.
"U.S. Syndicated Loans" shall mean Syndicated Loans made to the Company
under Section 2.1(a).
1.2 Other Definitions; Rules of Construction. As used herein, the terms
"Lenders", "Company", and "this Agreement" shall have the respective meanings
ascribed thereto in the introductory paragraph of this Agreement. Such terms,
together with the other terms defined in Section 1.1, shall include both the
singular and the plural forms thereof and shall be construed accordingly. Use of
the terms "herein", "hereof", and "hereunder" shall be deemed references to this
Agreement in its entirety and not to the Section or clause in which such term
appears. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided.
1.3 Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall (unless otherwise disclosed to the Lenders in writing at the
time of delivery thereof in the manner described in subsection (b) below) be
prepared, in accordance with Generally Accepted Accounting Principles (subject,
in the case of financial statements which are not fiscal year end statements, to
the absence of footnotes and year-end audit adjustments); provided that, if the
Company notifies the Agent that it wishes to amend any covenant in Article V to
eliminate the effect of any change in Generally Accepted Accounting Principles
(or if the Agent notifies the Company that the Required Lenders wish to amend
Article V for such purpose), then such Borrower's compliance with such covenants
shall be determined on the basis of Generally Accepted Accounting Principles in
effect immediately before the relevant change in Generally Accepted Accounting
Principles became effective until either such notice is withdrawn or such
covenant or any such defined term is amended in a manner satisfactory to such
Borrower and the Required Lenders. Except as otherwise expressly provided
herein, all references to a time of day shall be references to Detroit, Michigan
time. Notwithstanding anything herein, in any financial statements of the
Company or in Generally Accepted Accounting Principles to the contrary, for
purposes of calculating and determining compliance with the financial covenants
in Sections 5.2(a), (b) and (c), including defined terms used therein, any
Acquisitions made by the Company or any of its Subsidiaries including through
mergers or consolidations and including any related financing transactions,
during the period for which such financial covenants were calculated shall be
deemed to have occurred on the first day of the relevant period for which such
financial covenants were calculated on a pro forma basis acceptable to the
Agent.
(b) The Company shall deliver to the Lenders at the same time as the
delivery of any annual or quarterly financial statement under Section 5.1(d)
hereof (i) a description in reasonable detail of any material variation between
the application or other modification of accounting principles employed in the
preparation of such statement and the application or other modification of
accounting principles employed in the preparation of the immediately prior
annual or quarterly financial statements as to which no objection has been made
in accordance with the last sentence of subsection (a) above and (ii) reasonable
estimates of the difference between such statements arising as a consequence
thereof.
(c) To enable the ready and consistent determination of compliance with
the covenants set forth in Section 5.2 hereof, the Company will not change the
last day of its fiscal year from the last Saturday of December of each year, or
the last days of the first three fiscal quarters in each of its fiscal years
from the last Saturday in March, June and September of each year, respectively.
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ARTICLE II.
THE COMMITMENTS, THE SWINGLINE FACILITY AND THE ADVANCES
2.1 Commitments of the Lenders and the Swingline Facility.
(a) U.S. Syndicated Advances. Each U.S. Lender agrees, for itself
only, subject to the terms and conditions of this Agreement, to make U.S.
Syndicated Loans to the Company pursuant to Section 2.6 and Section 3.3 and to
participate in Letter of Credit Advances to the Company pursuant to Section 2.6
and Swingline Loans from time to time from and including the Effective Date to
but excluding the Termination Date not to exceed in aggregate principal amount
at any time outstanding the amount determined pursuant to Section 2.1(d).
(b) Canadian Syndicated Loans. Each Canadian Lender agrees, for
itself only, subject to the terms and conditions of this Agreement, to make
Canadian Syndicated Loans to the Canadian Borrower pursuant to Section 2.6 from
time to time from and including the Effective Date to but excluding the
Termination Date not to exceed in aggregate principal amount at any time
outstanding the amount determined pursuant to Section 2.1(d).
(c) Swingline Loans. (i) The Company may request the Agent to
make, and the Agent may, in its sole discretion, make Swingline Loans to the
Company from time to time on any Business Day during the period from the
Effective Date until the Termination Date in an aggregate principal amount not
to exceed at any time the lesser of (A) $20,000,000 (the "Swingline Facility")
and (B) the aggregate amount of U.S. Syndicated Advances that could be but are
not borrowed as of such date; provided, that the Agent shall not make a
Swingline Loan after it has received written notice from a Lender or the Company
referring to this Agreement and describing a Default or Event of Default and
stating that such notice is a "notice of default" and such Default or Event of
Default shall be continuing. Each U.S. Lender's U.S. Commitment shall be deemed
utilized by an amount equal to such Lender's Pro Rata Share of each Swingline
Loan for purposes of determining the amount of U.S. Syndicated Advances required
to be made by such Lender. Swingline Loans shall bear interest at a rate agreed
to by the Agent and the Company, provided that Swingline Loans shall bear
interest at the rate applicable to Floating Rate Loans at any time the Swingline
Loans are refunded by Floating Rate Loans or the U.S. Lenders are required to
purchase participations therein under Section 2.1(c)(iii). Within the limits of
the Swingline Facility, so long as the Agent, in its sole discretion, elects to
make Swingline Loans, the Company may borrow and reborrow under this Section
2.1(c)(i).
(ii) The Agent may at any time in its sole and absolute
discretion require that any Swingline Loan be refunded by a Floating Rate
Borrowing from the U.S. Lenders, and upon written notice thereof by the Agent to
such Lenders and the Company, the Company shall be deemed to have requested a
Floating Rate Borrowing in an amount equal to the amount of such Swingline Loan,
and such Floating Rate Borrowing shall be made to refund such Swing Line Loan.
Each such Lender shall be absolutely and unconditionally obligated to fund its
Pro Rata Share of such Floating Rate Borrowing or, if applicable, purchase a
participating interest in the Swingline Loans pursuant to Section 2.1(c)(iii)
and such obligation shall not be affected by any circumstance, including,
without limitation, (A) any set-off, counterclaim, recoupment, defense or other
right which such Lender has or may have against the Agent, or the Borrowers or
any of their Subsidiaries or anyone else for any reason whatsoever; (B) the
occurrence or continuance of a Default or an Event of Default, subject to
Section 2.1(c)(iii); (C)
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any Material Adverse Effect; (D) any breach of any Loan Document by any other
Lender, the Borrowers, or any Guarantor; or (E) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing
(including without limitation the Borrowers' failure to satisfy any conditions
contained in Article II or any other provision of this Agreement).
(iii) If Floating Rate Loans may not be made by the U.S.
Lenders as described in Section 2.1(c)(ii) due to any Event of Default pursuant
to Section 6.1(i) or if the U.S. Lenders are otherwise legally prohibited from
making Floating Rate Loans, then effective on the date each such Floating Rate
Loan would otherwise have been made, each U.S. Lender severally agrees that it
shall unconditionally and irrevocably, without regard to the occurrence of any
Default or Event of Default or any other circumstances, in lieu of deemed
disbursement of Loans, to the extent of such Lender's Commitment, purchase a
participating interest in the Swingline Loans by paying its participation
percentage thereof. Each such Lender will immediately transfer to the Agent, in
Same Day Funds, the amount of its participation. After such payment to the
Agent, each Lender shall share based on its Pro Rata Share in any interest which
accrues thereon and in all repayments thereof. If and to the extent that any
such Lender shall not have so made the amount of such participating interest
available to the Agent, such Lender and the Company severally agree to pay to
the Agent forthwith on demand such amount together with interest thereon, for
each day from the date of demand by the Agent until the date such amount is paid
to the Agent, at (A) in the case of the Company, the interest rate specified
above and (B) in the case of such Lender, the Federal Funds Rate for the first
five days after the date of demand by the Agent and thereafter at the interest
rate specified above.
(d) Limitation on Amount of Advances. Notwithstanding anything in
this Agreement to the contrary, (i) the U.S. Dollar Equivalent of the aggregate
principal amount of the U.S. Syndicated Loans, the Swingline Loans and the
Letters of Credit at any time outstanding to the Company shall not exceed the
aggregate U.S. Commitments of all Lenders as of the date any such Advance is
made, provided, however, that the U.S. Dollar Equivalent of the aggregate
Letters of Credit outstanding at any time shall not exceed $30,000,000 and the
U.S. Dollar Equivalent of the aggregate of Swingline Loans at any time
outstanding shall not exceed $20,000,000, (ii) the U.S. Dollar Equivalent of the
Pro Rata Share of the aggregate U.S. Syndicated Loans, the Swingline Loans and
the Letters of Credit of any U.S. Lender shall not exceed the U.S. Commitment of
such U.S. Lender, (iii) the U.S. Dollar Equivalent of the aggregate Canadian
Syndicated Loans of any Canadian Lender shall not exceed the Canadian Commitment
of such Canadian Lender, (iv) the U.S. Dollar Equivalent of the aggregate
Canadian Syndicated Loans of all Canadian Lenders will not exceed the amount of
the aggregate Canadian Commitments that the Canadian Borrower has designated to
the Agent as activated (the "Activated Aggregate Canadian Commitments"), and the
Canadian Borrower can activate or de-activate the Canadian Commitments at any
time provided that any such activation or de-activation shall be in increments
of $5,000,000 and shall not exceed $15,000,000 in aggregate amount, shall be
effective ten Business Days after notification by the Canadian Borrower to the
Agent and shall not reduce the Activated Aggregate Canadian Commitments below
the U.S. Dollar Equivalent of the aggregate Canadian Syndicated Loans of all
Canadian Lenders, and (v) the aggregate principal amount of the U.S. Syndicated
Loans, the Swingline Loans and the Letters of Credit will not exceed the
difference of the aggregate U.S. Commitments minus the amount of the Activated
Aggregate Canadian Commitments.
(e) Multicurrency Participation. Each U.S. Lender shall be deemed
to have unconditionally and irrevocably purchased from each Lender in its
capacity as a Canadian Lender, without recourse or warranty, an undivided
interest in and participation in each Canadian Syndicated Loan ratably in
accordance with such Lender's Pro Rata Share and each Lender in its capacity as
a Canadian Lender shall be deemed to have unconditionally and irrevocably
purchased from each U.S.
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Lender, without recourse or warranty, an undivided interest in and participation
in each U.S. Syndicated Loan ratably in accordance with such Lender's Pro Rata
Share, provided that payments for all such participations shall not be made
until required by the terms of the following sentence of this Section 2.1(e).
Upon the occurrence of an Event of Default under Sections 6.1(a) or (i), (i) all
Canadian Syndicated Loans shall be converted to and re-denominated in U.S.
Dollars equal to the U.S. Dollar Equivalent of each such Canadian Syndicated
Loan determined as of the date of such conversion, (ii) each of the U.S. Lenders
shall pay to the applicable Canadian Lenders not later than two (2) Business
Days following a request for payment from such Lender, in U.S. Dollars, an
amount equal to the undivided interest in and participation in the Canadian
Syndicated Loan purchased by such U.S. Lender pursuant to this Section 2.1(e),
and (iii) each of the Canadian Lenders shall pay to the applicable U.S. Lenders
not later than two (2) Business Days following a request for payment from such
Lender, in U.S. Dollars, an amount equal to the undivided interest in and
participation in the U.S. Syndicated Loan purchased by such Canadian Lenders
pursuant to this Section 2.1(e), it being the intent of the Lenders that
following such equalization payments, each Lender shall hold its Pro Rata Share
of the aggregate Syndicated Loans, Letters of Credit and Swingline Loans.
2.2 Bid-Option Loans.
(a) The Bid-Option. From the Effective Date to but excluding the
Termination Date, the Company may, as set forth in this Section 2.2, request the
Lenders to make offers to make Bid-Option Loans to the Company. Notwithstanding
anything herein to the contrary, no more than five requests for Bid-Option Loans
in the aggregate may be requested by the Company in any month. Each Lender may,
but shall have no obligation to, make such offers and the Company may, but shall
have no obligation to, accept any such offers, in the manner set forth in this
Section 2.2; furthermore, each Lender may limit the aggregate amount of
Bid-Option Loans when quoting rates for more than one Bid-Option Interest Period
in any Bid-Option Quote, provided that such limitation shall not be less than
the minimum amounts required hereunder for Bid-Option Loans and the Company may
choose among the Bid-Option Loans if such limitation is imposed; provided, that
the aggregate outstanding principal amount of Bid-Option Loans shall not at any
time exceed the lesser of (i) excess of (A) the aggregate amount of the U.S.
Commitments over (B) the sum of the aggregate outstanding principal amount of
Syndicated Advances and Swingline Loans or (ii) $75,000,000;
(b) Bid-Option Quote Request. When the Company wishes to request
offers to make Bid-Option Loans under this Section 2.2, it shall transmit to the
Agent by telex or telecopy a Bid-Option Quote Request substantially in the form
of Exhibit E hereto so as to be received no later than 11:00 a.m. Detroit time
(i) on the Business Day next preceding the date of the Loan proposed therein, in
the case of a Bid-Option Auction for Absolute Rate Bid-Option Loans, or (ii) the
fourth Business Day next preceding the date of the Loan proposed therein, in the
case of a Bid-Option Auction for Eurodollar Rate Bid-Option Loans specifying:
(A) the proposed date of the Bid-Option Loan, which shall be
a Business Day;
(B) the aggregate amount of such Bid-Option Loan, which shall
be a minimum of $3,000,000 or a larger multiple of $1,000,000;
(C) whether the Borrowing is to be an Absolute Rate
Bid-Option Borrowing or a Eurodollar Rate Bid-Option Borrowing; and
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(D) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period.
The Company may request offers to make Bid-Option Loans for more than one
Bid-Option Interest Period in a single Bid-Option Quote Request.
(c) Invitation for Bid-Option Quotes. Promptly upon receipt of a
Bid-Option Quote Request, the Agent shall send to the Lenders by telecopy (or
telephone promptly confirmed by telecopy) an Invitation for Bid-Option Quotes
substantially in the form of Exhibit F hereto, which shall constitute an
invitation by the Company to each such Lender to submit Bid-Option Quotes
offering to make the Bid-Option Loans to which such Bid-Option Quote Request
relates in accordance with this Section 2.2.
(d) Submission and Contents of Bid-Option Quotes. (i) Each Lender
may submit a Bid-Option Quote containing an offer or offers to make Bid-Option
Loans in response to any Invitation for Bid-Option Quotes. Each Bid-Option Quote
must comply with the requirements of this subsection (d) and must be submitted
to the Agent by telecopy (or by telephone promptly confirmed by telecopy) at its
office referred to in Section 8.2 not later than (A) 9:00 a.m. Detroit time on
the proposed date of the Borrowing, in the case of a Bid-Option Auction for
Absolute Rate Bid-Option Loans, or (B) 9:00 a.m. Detroit time on the third
Business Day prior to the proposed date of the Borrowing, in the case of a
Bid-Option Auction for Eurodollar Rate Bid-Option Loans; provided that
Bid-Option Quotes submitted by the Agent (or any Affiliate of the Agent) in the
capacity of a Lender may be submitted, and may only be submitted, if the Agent
or such Affiliate notifies the Company of the terms of the offer or offers
contained therein not later than (A) 8:45 a.m. Detroit time on the proposed date
of such Borrowing, in the case of a Bid-Option Auction for Absolute Rate
Bid-Option Loans or (B) 8:45 a.m. Detroit time on the third Business Day prior
to the proposed date of the Borrowing, in the case of a Bid-Option Auction for
Eurodollar Rate Bid-Option Loans. Subject to Section 3.8 and Article VI, any
Bid-Option Quote so made shall be irrevocable except with the written consent of
the Agent given on the instructions of the Company.
(ii) Each Bid-Option Quote shall be in substantially the form
of Exhibit G hereto, but may be submitted to the Agent by telephone with prompt
confirmation by delivery to the Agent of such written Bid-Option Quote, and
shall in any case specify:
(A) the proposed date of the Borrowing;
(B) the principal amount of the Bid-Option Loan for
which each such offer is being made, which principal amount (x) must be in a
minimum of $3,000,000 or a larger multiple of $1,000,000, and (y) may not exceed
the principal amount of the Bid-Option Loans for which offers were requested;
(C) whether the Bid-Option Loans for which the offers
are made are Absolute Rate Bid-Option Loans or Eurodollar Rate Bid-Option Loans,
which must match the type of Borrowing stated in the related Invitation for
Bid-Option Quotes;
(D) the Interest Period(s) for which each such
Bid-Option Absolute Rate or Bid-Option Eurodollar Rate Margin, as the case may
be, is offered;
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(E) in the case of a Bid-Option Auction for Absolute
Rate Bid-Option Loans, the rate of interest per annum (rounded to the nearest
1/1000 of 1%) (the "Bid-Option Absolute Rate") offered for each such Bid-Option
Loan;
(F) in the case of a Bid-Option Auction for Eurodollar
Rate Bid-Option Loans, the applicable margin, which may be positive or negative
(the "Bid-Option Eurodollar Rate Margin") expressed as a percentage (rounded to
the nearest 1/1000 of 1%), offered for each such Bid-Option Loan; and
(G) the identity of the quoting Lender.
(iii) Any Bid-Option Quote shall be disregarded if it:
(A) is not substantially in the form of Exhibit G hereto
(or submitted by telephone to the Agent with prompt written
confirmation to follow) or does not specify all of the information required by
clause (ii) of this subsection (d);
(B) contains qualifying, conditional or similar
language;
(C) proposes terms other than or in addition to those
set forth in the applicable Invitation for Bid-Option Quotes; or
(D) arrives after the time set forth in Section
2.2(d)(i);
provided that a Bid-Option Quote shall not be disregarded pursuant to clause (B)
or (C) above solely because it contains an indication that an allocation that
might otherwise be made to it pursuant to Section 2.2(g) would be unacceptable.
The Agent shall notify the Company of any disregarded Bid-Option Quote.
(e) Notice to Company. The Agent shall promptly notify the Company
of the terms of any Bid-Option Quote submitted by a Lender that is in accordance
with Section 2.2(d). Any Bid-Option Quote not made in accordance with Section
2.2(d) shall be disregarded by the Agent. The Agent's notice to the Company
shall specify (i) the aggregate principal amount of Bid-Option Loans for which
offers have been received for each Bid-Option Interest Period specified in the
related Bid-Option Quote Request, and (ii) the respective principal amounts and
respective Bid-Option Absolute Rates or Bid-Option Eurodollar Rate Margins, as
the case may be, so offered.
(f) Acceptance and Notice by Company. Not later than 11:00 a.m.
Detroit time on (i) the proposed date of a Borrowing, in the case of a
Bid-Option Auction for Absolute Rate Bid-Option Loans or (ii) the third Business
Day prior to the proposed date of the Borrowing, in the case of a Bid-Option
Borrowing for Eurodollar Rate Bid-Option Loans, the Company shall notify the
Agent of its acceptance or non-acceptance of the offers so notified to it
pursuant to subsection (e) of this Section and the Agent shall, promptly upon
receiving such notice from the Company, notify each Lender whose Bid-Option
Quote has been accepted. In the case of acceptance, such notice (a "Notice of
Bid-Option Loan") shall specify the aggregate principal amount of offers for the
applicable Interest Period(s) that have been accepted. The Company may accept
any Bid-Option Quote in whole or in part; provided that:
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(i) the aggregate principal amount of each Bid-Option Loan
may not exceed the applicable amount set forth in the related Bid-Option Quote
Request for the applicable Bid-Option Interest Period;
(ii) the principal amount of each Bid-Option Loan must be
$3,000,000 or a larger multiple of $1,000,000;
(iii) acceptance of offers may only be made on the basis of
ascending Bid-Option Absolute Rates or Bid-Option Eurodollar Rate Margins, as
the case may be; and
(iv) the Company may not accept any offer that is described
in Section 2.2(d)(iii) or that otherwise fails to comply with the requirements
of this Agreement.
(g) Allocation by Agent. If offers are made by two or more Lenders
with the same Bid-Option Absolute Rates or Bid-Option Eurodollar Rate Margins,
as the case may be, for a greater aggregate principal amount than the amount in
respect of which offers are accepted for the related Interest Period, the
principal amount of Bid-Option Loans in respect of which such offers are
accepted shall be allocated by the Agent among such Lenders as nearly as
possible (in such multiples, not greater than $100,000, as the Agent may deem
appropriate) in proportion to the aggregate principal amount of such offers.
Determinations by the Agent of the amounts of Bid-Option Loans shall be
conclusive in the absence of manifest error.
2.3 Effect on Commitments. Notwithstanding anything in this Agreement
to the contrary, the sum of the aggregate principal amount of all Syndicated
Loans, all Letter of Credit Advances (being the maximum amount available to be
drawn under the related Letters of Credit plus the amount of any draws under
Letters of Credit that have not been reimbursed), all Swingline Loans and all
Bid-Option Loans shall not at any time exceed the aggregate amount of the U.S.
Commitments of all Lenders. Each Lender's obligation to make its Pro Rata Share
of any subsequently requested Syndicated Loan or Letter of Credit Advance shall
not be affected by the making by such Lender of a Bid-Option Loan, and the
Lender which has outstanding Bid-Option Loans may be obligated to exceed its
Commitment, provided that, as stated above, the aggregate principal amount of
all Syndicated Loans, all Letters of Credit Advances, all Swingline Loans and
all Bid-Option Loans shall not at any time exceed the aggregate amount of the
U.S. Commitments of all Lenders.
2.4 Termination, Reduction and Increase of Commitments. (a) The Company
shall have the right to terminate or reduce the U.S. Commitments at any time and
from time to time at its option and the Canadian Borrower shall have the right
to terminate or reduce the Canadian Commitments at any time and from time to
time at its option, provided that (i) the relevant Borrower shall give three
days' prior written notice of such termination or reduction to the Agent
specifying the amount and effective date thereof, (ii) each partial reduction of
the U.S. Commitments shall be in a minimum amount of $10,000,000 and in an
integral multiple of $1,000,000 thereafter and shall reduce the U.S. Commitments
of all of the U.S. Lenders proportionately in accordance with their respective
U.S. Commitment, (iii) each partial reduction of the Canadian Commitments shall
be in a minimum amount of $5,000,000 and in an integral multiple of $1,000,000
thereafter and shall reduce the Canadian Commitments of all of the Canadian
Lenders proportionately in accordance with their respective Canadian Commitment,
(iv) no such termination or reduction shall be permitted with respect to any
portion of the Commitments as to which a request for a Borrowing pursuant to
Section 2.6 is then pending, (v) the U.S. Commitments may not be terminated if
any U.S. Syndicated Advances are then outstanding and may not be reduced below
the principal amount of U.S.
-23-
Syndicated Advances then outstanding and (vi) the Canadian Commitments may not
be terminated if any Canadian Syndicated Loans are then outstanding and may not
be reduced below the principal amount of Canadian Syndicated Loans then
outstanding.
The Commitments or any portion thereof terminated or reduced pursuant
to this Section 2.4(a), whether optional or mandatory, may not be reinstated.
The Company shall immediately prepay the U.S. Syndicated Advances to the extent
they exceed the reduced aggregate U.S. Commitments pursuant hereto and the
Canadian Borrower shall immediately prepay the Canadian Syndicated Loans to the
extent they exceed the reduced aggregate Canadian Commitments pursuant hereto,
and any reduction hereunder shall reduce the applicable Commitment amount of
each Lender proportionately in accordance with the respective applicable
Commitment amounts for each such Lender set forth on the signature pages hereof
next to the name of each such Lender.
(b) For purposes of this Agreement, a Letter of Credit
Advance (i) shall be deemed outstanding in an amount equal to the sum of the
maximum amount available to be drawn under the related Letter of Credit on or
after the date of determination and on or before the stated expiry date thereof
plus the amount of any draws under such Letter of Credit that have not been
reimbursed as provided in Section 3.3 and (ii) shall be deemed outstanding at
all times on and before such stated expiry date or such earlier date on which
all amounts available to be drawn under such Letter of Credit have been fully
drawn, and thereafter until all related reimbursement obligations have been paid
pursuant to Section 3.3. As provided in Section 3.3, upon each payment made by
the Agent in respect of any draft or other demand for payment under any Letter
of Credit, the amount of any Letter of Credit Advance outstanding immediately
prior to such payment shall be automatically reduced by the amount of each
Syndicated Loan deemed advanced in respect of the related reimbursement
obligation of the Company.
(c) With the prior consent of the Agent, the Company may
request to increase the Commitment in increments of $25,000,000, provided that
the Aggregate Commitment shall not exceed $250,000,000. Any such request to
increase the Commitments shall be deemed to be a certification by the Borrowers
that at the time of such request, there exists no Default or Event of Default
and the representations and warranties contained in Article IV are true and
correct as of such date or, if applicable only to a prior date, as of such prior
date. Any request from the Company to increase the Commitments shall be
implemented by one or more existing Lenders agreeing to increase their
Commitments (provided that no Lender shall have any obligation to increase its
Commitment) or by one or more new lenders agreeing to become a Lender hereunder
or by any combination of the foregoing, as determined by the Agent and the
Arranger in consultation with the Company. Prior to any such increase in the
Commitments becoming effective, the Agent shall have received:
(a) copies, certified by the secretary of the Company of their Board of
Directors' resolutions and of resolutions or actions of any other body
authorizing the increase in the Commitments and the confirmation and
ratification of the Loan Documents;
(b) a certificate, signed by the chief financial officer of the
Company, showing that after giving effect to the increase in the
Commitments, no Default or Event of Default shall occur and the
Borrowers shall be in compliance with all covenants in this Agreement;
(c) copies of all governmental and nongovernmental consents, approvals,
authorizations, declarations, registrations or filings required on the
part of the Borrowers in connection with the increase in the
Commitments, certified as true and correct in full
-24-
force and effect as of the date of the increase by a duly authorized
officer of each Borrower, or if none are required, a certificate of
such officer to that effect;
(d) a confirmation and ratification of all Loan Documents signed by the
Borrowers and the Guarantors and in form and substance satisfactory to
the Agent;
(e) evidence satisfactory to the Agent that no Material Adverse Effect
shall have occurred with respect to the Company and its Subsidiaries
since the most recent financial statements provided to the Lenders
hereunder; and
(f) such other documents and conditions as the Agent or its counsel may
have reasonably requested.
2.5 Fees. (a) The Company agrees to pay to the U.S. Lenders a facility
fee on the amount of the U.S. Commitments, whether used or unused, for the
period from the Effective Date to but excluding the Termination Date, at a rate
equal to the Applicable Margin per annum. Accrued facility fees shall be payable
quarterly in arrears on the last Business Day of each March, June, September and
December, commencing on the first such Business Day occurring after the date of
this Agreement, and on the Termination Date.
(b) The Company agrees (i) to pay to the U.S. Lenders a fee
at a rate equal to the Applicable Margin per annum, on the maximum amount
available to be drawn from time to time under each Letter of Credit for the
period from and including the date of issuance of such Letter of Credit (or from
and including the Effective Date in the case of Existing Letters of Credit) to
and including the termination of such Letter of Credit, which fees shall be
payable quarterly in arrears on the last Business Day of each March, June,
September and December and on the Termination Date, based upon the Applicable
Margin at the time each such quarterly installment is paid, and (ii) to pay an
additional fee to the Agent for its own account computed at the rate of 0.125%
per annum of such maximum amount for such period, which fees shall be payable
quarterly in arrears on the last Business Day of each March, June, September and
December and on the Termination Date. The Company further agrees to pay to the
Agent, on demand, such other customary administrative fees, charges and expenses
of the Agent in respect of the issuance, negotiation, acceptance, amendment,
transfer and payment of such Letter of Credit or otherwise payable pursuant to
the application and related documentation under which such Letter of Credit is
issued.
(c) The Borrowers agree to pay to the Agent and the Arranger
such fees for their services as Agent and Arranger under this Agreement in such
amounts as may from time to time be agreed upon by the Borrowers, the Agent, and
the Arranger.
2.6 Disbursement of Syndicated Advances. (a) A Borrower shall give the
Agent notice of its request for each Syndicated Advance in substantially the
form of Exhibit H hereto not later than 10:00 a.m. Detroit time (i) three
Business Days prior to the date such Advance is requested to be made if such
Borrowing is to be made as a Eurodollar Rate Syndicated Loan, (ii) three
Business Days prior to the day such Advance is requested to be made if such
Borrowing is to be made as a BA Rate Syndicated Loan, (iii) two Business Days
prior to the date any Letter of Credit Advance is requested to be made and (iv)
on the date such Syndicated Loan is requested to be made in all other cases,
which notice shall specify whether a Eurodollar Rate Syndicated Loan, Floating
Rate Loan, BA Rate Syndicated Loan, or a Letter of Credit Advance is requested
and, in the case of each requested Eurodollar Rate Syndicated Loan or BA Rate
Syndicated Loan, the Interest Period to be initially applicable to such Loan.
The Company shall give the Agent notice of its request for each Swingline Loan
in such form requested by the Agent not later than 11:00 a.m. Detroit time on
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the same Business Day such Swingline Loan is requested to be made. The Agent, on
the same day any such notice is given, shall provide notice of each such
requested U.S. Syndicated Loan to each U.S. Lender and of each such Canadian
Syndicated Loan to each Canadian Lender. Subject to the terms and conditions of
this Agreement, the proceeds of each such requested Syndicated Loan and
Swingline Loan shall be made available to each Borrower by depositing the
proceeds thereof, in Same Day Funds, in an account maintained and designated by
such Borrower at the applicable Agent Payment Office. Subject to the terms and
conditions of this Agreement, the Agent shall, on the date any Letter of Credit
Advance is requested to be made, issue the related Letter of Credit on behalf of
the Lenders for the account of the Company; provided, that the Agent shall not
issue, and shall not be required to issue, any Letter of Credit Advance after it
has received written notice from a Lender or the Company referring to this
Agreement and describing a Default or Event of Default and stating that such
notice is a "notice of default" and such Default or Event of Default shall be
continuing. Notwithstanding anything herein to the contrary, the Agent may
decline to issue any requested Letter of Credit on the basis that the
beneficiary, the purpose of issuance or the terms or the conditions of drawing
are unacceptable to it based upon any legal, policy or ethical concerns in its
reasonable discretion. Each U.S. Syndicated Loan shall be made in U.S. Dollars
from the U.S. Lenders in accordance with their Pro Rata Share and shall be
Eurodollar Rate Syndicated Loans or Floating Rate Loans. Each Canadian
Syndicated Loan shall be made in Canadian Dollars from the Canadian Lenders in
accordance with their Pro Rata Share and shall be BA Rate Syndicated Loans or
Floating Rate Loans.
(b) Subject to Section 2.6(g), each U.S. Lender, on the date
any U.S. Syndicated Loan is requested to be made, shall make its Pro Rata Share
of such U.S. Syndicated Loan available in Same Day Funds for disbursement to the
Company pursuant to the terms and conditions of this Agreement at the applicable
Agent Payment Office. Unless the Agent shall have received notice from any
Lender prior to the date such U.S. Syndicated Loan is requested to be made under
this Section 2.6 that such Lender will not make available to the Agent such U.S.
Lender's Pro Rata Share of such Loan, the Agent may assume that such Lender has
made such portion available to the Agent on the date such Loan is requested to
be made in accordance with this Section 2.6. If and to the extent such U.S.
Lender shall not have so made such Pro Rata Share available to the Agent, the
Agent may (but shall not be obligated to) make such amount available to the
Company, and such U.S. Lender agrees to pay to the Agent forthwith on demand
such amount together with interest thereon, for each day from the date such
amount is made available to the Company by the Agent until the date such amount
is repaid to the Agent, at a rate per annum equal to the Federal Funds Rate then
in effect for the first three Business Days and at the Floating Rate thereafter.
If such U.S. Lender shall pay such amount to the Agent together with interest,
such amount so paid shall constitute a U.S. Syndicated Loan by such Lender as
part of the related Borrowing for purposes of this Agreement. The failure of any
Lender to make its Pro Rata Share of any such Borrowing available to the Agent
shall not relieve any other Lender of its obligation to make available its Pro
Rata Share of such Loan on the date such Loan is requested to be made, but no
Lender shall be responsible for failure of any other Lender to make such Pro
Rata Share available to the Agent on the date of any such Loan.
(c) Each Canadian Lender, on the date any Canadian Syndicated
Loan is requested to be made, shall make such Canadian Syndicated Loan available
in Same Day Funds for disbursement to the Canadian Borrower pursuant to the
terms and conditions of this Agreement at the applicable Agent Payment Office.
Unless the Agent shall have received notice from a Canadian Lender prior to the
date such Canadian Syndicated Loan is requested to be made under this Section
2.6 that such Canadian Lender will not make available to the Agent such Canadian
Syndicated Loan, the Agent may assume that such Canadian Lender has made such
Canadian Syndicated Loan to the Agent on the date such Loan is requested to be
made in accordance with this Section 2.6. If and to the extent a Canadian Lender
shall not have so made such Canadian Syndicated Loan available to the Agent, the
Agent may (but shall not be obligated to) make such Loan available to the
Canadian Borrower, and such Canadian Lender agrees to pay to the Agent
-26-
forthwith on demand such amount together with interest thereon, for each day
from the date such amount is made available to the Canadian Borrower by the
Agent until the date such amount is repaid to the Agent, at a rate per annum
equal to the cost of funds rate determined by the Agent for the first three
Business Days and thereafter at the Floating Rate. If a Canadian Lender shall
pay such amount to the Agent together with interest, such amount so paid shall
constitute a Canadian Syndicated Loan by such Canadian Lender as part of the
related Borrowing for purposes of this Agreement.
(d) All Syndicated Loans shall be evidenced by the Revolving
Credit Notes and all Swingline Loans shall be evidenced by the Swingline Note,
and all such Loans shall be due and payable and bear interest as provided in
Article III. Each Lender is hereby authorized by the Borrowers to record on the
schedule attached to the Notes, or in its books and records, the date, amount
and type of each Loan and the duration of the related Interest Period (if
applicable), the amount of each payment or prepayment of principal thereon, and
the other information provided for on such schedule, which schedule or books and
records, as the case may be, shall constitute prima facie evidence of the
information so recorded, provided, however, that failure of any Lender to
record, or any error in recording, any such information shall not relieve a
Borrower of its obligation to repay the outstanding principal amount of the
Loans, all accrued interest thereon and other amounts payable with respect
thereto in accordance with the terms of the Notes and this Agreement. Subject to
the terms and conditions of this Agreement, the Company may borrow U.S.
Syndicated Loans and Swingline Loans under this Section 2.6 and under Section
3.3, prepay Syndicated Loans and Swingline Loans pursuant to Section 3.1 and
reborrow Syndicated Loans and Swingline Loans under this Section 2.6 and under
Section 3.3. Subject to the terms and conditions of this Agreement, the Canadian
Borrower may borrow Canadian Syndicated Loans under this Section 2.6, prepay
Canadian Syndicated Loans pursuant to Section 3.1 and reborrow Canadian
Syndicated Loans under this Section 2.6.
(e) All Bid-Option Loans shall be in U.S. Dollars and shall
be disbursed directly by the Lender making such Bid-Option Loan to the Company
by 1:30 p.m. Detroit time on the date such Bid-Option Loan is requested to be
made via wire transfer in Same Day Funds to Bank One, NA, 611 Woodward Avenue,
Detroit, Michigan 48226, ABA Number 072000326, Reference: Universal Forest
Products, Inc. confirm to Agency Administration, or as otherwise directed by the
Company.
(f) Nothing in this Agreement shall be construed to require
or authorize any Lender to issue any Letter of Credit, it being recognized that
the Agent has the sole obligation under this Agreement to issue Letters of
Credit on behalf of the Lenders, and the Commitment of each Lender with respect
to Letter of Credit Advances is expressly conditioned upon the Agent's
performance of such obligations. Upon such issuance by the Agent (or on the
Effective Date in the case of the Existing Letters of Credit), each Lender shall
automatically acquire a risk participation interest in such Letter of Credit
Advance based on its Pro Rata Share. If the Agent shall honor a draft or other
demand for payment presented or made under any Letter of Credit, the Agent shall
provide notice thereof to each Lender on the date such draft or demand is
honored unless the Company shall have satisfied its reimbursement obligation
under Section 3.3 by payment to the Agent on such date. Each Lender, on such
date, shall make its Pro Rata Share of the amount paid by the Agent available in
Same Day Funds at the applicable Agent Payment Office for the account of the
Agent. If and to the extent such Lender shall not have made such Pro Rata Share
available to the Agent, such Lender and the Company severally agree to pay to
the Agent forthwith on demand such amount together with interest thereon, for
each day from the date such amount was paid by the Agent until such amount is so
made available to the Agent at a per annum rate equal to the Federal Funds Rate.
If such Lender shall pay such amount to the Agent together with such interest,
such amount so paid shall constitute a Syndicated Loan by such Lender as part of
the Advance disbursed in respect of the reimbursement obligation of the Company
under Section 3.3 for purposes of this Agreement. The failure of any Lender to
make its Pro Rata Share of
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any such amount paid by the Agent available to the Agent shall not relieve any
other Lender of its obligation to make available its Pro Rata Portion of such
amount, but no Lender shall be responsible for failure of any other Lender to
make such Pro Rata Portion available to the Agent.
(g) If on any proposed date of an Advance the Canadian
Borrower has requested Canadian Syndicated Loans (the "Requested Canadian
Syndicated Loans"), (i) the Dollar Equivalent of the aggregate principal amount
of the Requested Canadian Syndicated Loans exceeds the Aggregate Available
Canadian Commitments on such date (before giving effect to the making and
payment of any Loans required to be made pursuant to this clause (g) on such
date) and (ii) the Dollar Equivalent of the amount of such excess is less than
or equal to the Aggregate Available U.S. Commitments of all Canadian Lenders
(before giving effect to the making and payment of any Loans pursuant to this
clause (g) on such date), each U.S. Lender shall make a U.S. Syndicated Loan to
the Company on such date, and the proceeds of such Loans shall be simultaneously
applied to repay outstanding U.S. Syndicated Loans of the Canadian Lenders, in
amounts such that, after giving effect to (1) such borrowings and repayments and
(2) the borrowing from the Canadian Lenders of the Requested Canadian Syndicated
Loans, the Aggregate Syndicated Outstandings of each Lender will equal (as
nearly as possible) its Pro Rata Share. To effect such borrowings and
repayments, (x) not later than 10:00 a.m., Detroit time, on such date, the
proceeds of such U.S. Syndicated Loans shall be made available by each U.S.
Lender to the Agent at its applicable Agent Payment Office in Same Day Funds and
the Agent shall apply the proceeds of such U.S. Syndicated Loans toward
repayment of outstanding U.S. Syndicated Loans of the Canadian Lenders and (y)
concurrently with the repayment of such outstanding U.S. Syndicated Loans of
such Canadian Lender on such date, (1) such Canadian Lenders shall, in
accordance with the applicable provisions hereof, make the Canadian Syndicated
Loans in an aggregate amount equal to the amount so requested (but not in any
event greater than the amount allowed under Section 2.1(d)) after giving effect
to the making and repayment of any Loans on such date and (2) the relevant
Borrower shall pay to the Agent for the account of the Lenders whose Loans to
such Borrower are paid on such date pursuant to this clause (g) all interest
accrued on the amounts repaid to the date of such repayment, together with any
amounts otherwise payable in connection with such repayment. If any borrowing of
U.S. Syndicated Loans is required pursuant to this clause (g), the Company shall
notify the Agent in the manner provided for U.S. Syndicated Loans in Section
2.6(a).
2.7 Conditions for First Disbursement. The obligation of each Lender to
make its first Advance hereunder is subject to receipt by each Lender and the
Agent of the following documents and completion of the following matters, in
form and substance reasonably satisfactory to the Agent:
(a) Charter Documents. Certificates of recent date of the
appropriate authority or official of each Obligor's respective state or province
of organization listing all charter documents of each Obligor, on file in that
office and certifying as to the good standing and corporate existence of such
Obligor, together with copies of such charter documents of such Obligor,
certified as of a recent date by such authority or official and certified as
true and correct as of the Effective Date by a duly authorized officer of such
Obligor, respectively;
(b) By-Laws and Corporate Authorizations. Copies of the
by-laws of each Obligor together with all authorizing resolutions and evidence
of other corporate and other action taken by such Obligor to authorize the
execution, delivery and performance by each Obligor of the Loan Documents to
which it is a party and the consummation by each Obligor of the transactions
contemplated hereby or thereby, certified as true and correct as of the
Effective Date by a duly authorized officer of each Obligor, respectively;
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(c) Incumbency Certificate. Certificates of incumbency of
each Obligor containing, and attesting to the genuineness of, the signatures of
those officers authorized to act on behalf of each Obligor in connection with
the Loan Documents to which it is a party and the consummation by each Obligor
of the transactions contemplated hereby, certified as true and correct as of the
Effective Date by a duly authorized officer of each Obligor;
(d) Legal Opinion. The favorable written opinions of U.S. and
Canadian counsel for the Obligors in the form of Exhibit I attached hereto;
(e) Consents, Approvals, Etc. Copies of all governmental and
nongovernmental consents, approvals, authorizations, declarations, registrations
or filings, if any, required on the part of the Obligors in connection with the
execution, delivery and performance of the Loan Documents or the transactions
contemplated hereby or as a condition to the legality, validity or
enforceability of the Loan Documents, certified as true and correct and in full
force and effect as of the Effective Date by a duly authorized officer of the
Obligors, or, if none are required, a certificate of such officer(s) to that
effect;
(f) Covenant Compliance Certificate. A covenant compliance
certificate in the form of Exhibit J attached hereto from the chief financial
officer or treasurer of the Company;
(g) Solvency Certificate. A solvency certificate in the form
of Exhibit K attached hereto from the chief financial officer or treasurer of
the Company;
(h) Intercreditor Agreement Acknowledgment. An acknowledgment
to the Intercreditor Agreement in the form attached as Exhibit A-1 to the
Intercreditor Agreement executed by the Agent for the Lenders, and each Lender
hereby authorizes the Agent to sign such acknowledgment on its behalf;
(i) Obligations under Prior Credit Agreement. Simultaneously
with disbursement of the first Advance hereunder, payment in full of all
principal of all promissory notes issued pursuant to the Prior Credit Agreement
and all accrued interest thereon through the Effective Date, together with
payment in full of all other indebtedness under the Prior Credit Agreement,
including without limitation the payment of all commitment and facility fees
accrued through the Effective Date under the Prior Credit Agreement, and on the
Effective Date all commitments to lend under the Prior Credit Agreement shall
terminate, and all parties hereto acknowledge and agree that this Agreement
replaces and refinances the Prior Credit Agreement and is a "Successor Bank
Credit Agreement" under the Intercreditor Agreement;
(j) Other Loan Documents. Executed copies of each of the
Notes, the Guaranties and Pledge Agreements, executed by each party thereto,
together with all original stock certificates, stock powers, legal opinions and
other documents required by the Agent in connection therewith;
(k) Due Diligence. Satisfactory results of all due diligence
required by the Lenders with respect to actual and potential litigation claims
against the Company and its Subsidiaries, including without limitation a review
of liability and insurance coverage; and
(l) Miscellaneous. Such other certificates and documents as
may be reasonably requested by the Agent.
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2.8 Further Conditions for Disbursement. The obligation of each Lender
to make any Advance (including its first Advance), or any continuation or
conversion under Section 2.9, is further subject to the satisfaction of the
following conditions precedent:
(a) The representations and warranties contained in Article
IV hereof and in any other Loan Document shall be true and correct in all
material respects on and as of the date such Advance is made, continued or
converted (both before and after such Advance is made, continued or converted)
as if such representations and warranties were made on and as of such date; and
(b) No Event of Default and no Default shall exist or shall
have occurred and be continuing on the date such Advance is made, continued or
converted (whether before or after such Advance is made, continued or
converted);
(c) In the case of any Letter of Credit Advance, at least two
Business Days prior to the date such Letter of Credit is to be issued, the
Company shall have delivered to the Agent an application for the related Letter
of Credit and other related documentation requested by and acceptable to the
Agent appropriately completed and duly executed on behalf of the Company.
Each Borrower shall be deemed to have made a representation and warranty to the
Lenders at the time of the making of, and the continuation or conversion of,
each Advance made to such Borrower to the effects set forth in clauses (a) and
(b) of this Section 2.8. For purposes of this Section 2.8, the representations
and warranties contained in Section 4.6 hereof shall be deemed made with respect
to the most recent financial statements delivered pursuant to Section
5.1(d)(iii).
2.9 Subsequent Elections as to Borrowings. The Company may elect (a) to
continue a Eurodollar Rate Syndicated Borrowing of one type, or a portion
thereof, as a Eurodollar Rate Syndicated Borrowing of the then existing type, or
(b) may elect to convert a Eurodollar Rate Syndicated Borrowing, or a portion
thereof, to a Eurodollar Rate Syndicated Borrowing of another type or (c) elect
to convert a Floating Rate Borrowing, or a portion thereof, to a Eurodollar Rate
Syndicated Borrowing, and the Canadian Borrower may elect (i) to continue a BA
Rate Borrowing of one type, or a portion thereof, as a BA Rate Borrowing of the
then existing type, or (ii) may elect to convert a BA Rate Borrowing, or a
portion thereof, to a BA Rate Borrowing of another type or (iii) elect to
convert a Floating Rate Borrowing, or a portion thereof, to a BA Rate Borrowing,
in each case by giving notice thereof to the Agent in substantially the form of
Exhibit L hereto not later than 10:00 a.m. Detroit time (A) three Business Days
prior to the date any such continuation of or conversion to a Eurodollar Rate
Syndicated Borrowing is to be effective, (B) three Business Days prior to the
date any such continuation of or conversion to a BA Rate Borrowing is to be
effective, and (C) the date such continuation or conversion is to be effective
in all other cases, provided that an outstanding Eurodollar Rate Syndicated
Borrowing and BA Rate Syndicated Loan may only be converted on the last day of
the then current Interest Period with respect to such Borrowing unless the
Company has paid break funding costs as set forth in Section 3.9, and provided,
further, if a continuation of a Borrowing as, or a conversion of a Borrowing to,
a Fixed Rate Borrowing is requested, such notice shall also specify the Interest
Period to be applicable thereto upon such continuation or conversion. The Agent,
on the day any such notice is given, shall provide notice of such election to
the Lenders. If a Borrower shall not timely deliver such a notice with respect
to any outstanding Fixed Rate Syndicated Borrowing, such Borrower shall be
deemed to have elected to convert such Fixed Rate Syndicated Borrowing to a
Floating Rate Borrowing on the last day of the then current Interest Period with
respect to such Borrowing.
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2.10 Limitation of Requests and Elections. Notwithstanding any other
provision of this Agreement to the contrary, if, upon receiving a request for a
Eurodollar Rate Syndicated Borrowing pursuant to Section 2.6, or a request for a
continuation of a Eurodollar Rate Syndicated Borrowing as a Eurodollar Rate
Syndicated Borrowing of the then existing type, or a request for conversion of a
Eurodollar Rate Syndicated Borrowing of one type to a Eurodollar Rate Syndicated
Borrowing of another type, or a request for a conversion of a Floating Rate
Borrowing to a Eurodollar Rate Syndicated Borrowing pursuant to Section 2.9, (a)
in the case of any Eurodollar Rate Syndicated Borrowing, deposits in U.S.
Dollars for periods comparable to the Interest Period elected by the Company are
not available to any Lender in the relevant interbank or secondary market and
such Lender has provided to the Agent and the Company a certificate prepared in
good faith to that effect, or (b) any Lender reasonably determines that the
Eurodollar Base Rate will not adequately and fairly reflect the cost to such
Lender of making, funding or maintaining the related Eurodollar Rate Syndicated
Loan and such Lender has provided to the Agent and the Company a certificate
prepared in good faith to that effect, or (c) by reason of national or
international financial, political or economic conditions or by reason of any
applicable law, treaty, rule or regulation (whether domestic or foreign) now or
hereafter in effect, or the interpretation or administration thereof by any
governmental authority charged with the interpretation or administration
thereof, or compliance by any Lender with any directive of such authority
(whether or not having the force of law), including without limitation exchange
controls, it is impracticable, unlawful or impossible for any Lender (i) to make
or fund the relevant Eurodollar Rate Syndicated Borrowing or (ii) to continue
such Eurodollar Rate Syndicated Borrowing as a Eurodollar Rate Syndicated
Borrowing of the then existing type or (iii) to convert a Loan to such a
Eurodollar Rate Syndicated Loan, and such Lender has provided to the Agent and
the Company a certificate prepared in good faith to that effect, then,
notwithstanding any other provision herein, (A) the Commitment of such Lender to
make or continue Eurodollar Rate Syndicated Borrowings or to convert Floating
Rate Loans to Eurodollar Rate Syndicated Loans shall forthwith be canceled until
such time as such Lender shall no longer be subject to such circumstances
preventing it from making or maintaining the affected Loans, and (B) such
Lender's Loans then outstanding as Eurodollar Rate Syndicated Loans, if any,
shall be converted automatically to Floating Rate Loans on the respective last
days of the then current Interest Periods with respect thereto or within such
earlier period as may be required by law. If any such conversion of a Eurodollar
Rate Syndicated Loan occurs on a day which is not the last day of the then
current Interest Period with respect thereto, the Company shall pay to such
Lender such amounts, if any, as may be required under Section 3.9.
2.11 Minimum Amounts; Limitation on Number of Borrowings. Except for
(a) Borrowings and conversions thereof which exhaust the entire remaining amount
of the Commitments, and (b) conversions or payments required pursuant to Section
3.1(c) or Section 3.8, each Syndicated Advance, each continuation or conversion
pursuant to Section 2.9 and each prepayment thereof shall be in a minimum amount
of $3,000,000 and in integral multiples of $1,000,000 or such lesser amount
agreed to by the Agent.
2.12 Notes. The Borrowers agree that, upon the request of the Agent or
any Lender, the Borrowers will execute and deliver to such Lender Notes for such
Lender, provided that the delivery of such Notes shall not be a condition
precedent to the making of any Advances.
2.13 Security and Collateral To secure or guarantee the payment when
due of all Lender Obligations, the Borrowers shall execute and deliver, or cause
to be executed and delivered, to the Lenders and the Agent Loan Documents
granting the following, subject to any Intercreditor Agreement:
(a) Pledges, pursuant to Pledge Agreements, of 65% of the
present and future Capital Stock of certain present and future Foreign
Subsidiaries and Guaranties of certain present and future Domestic Subsidiaries
such that, at all times, the Domestic Subsidiaries which are not Guarantors and
the Foreign Subsidiaries that do not have 65% of their Capital Stock pledged
pursuant to Pledge Agreements do
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not, if considered in the aggregate as a single Subsidiary, constitute a
Significant Subsidiary; and
(b) All other security and collateral described in the Pledge
Agreements.
ARTICLE III.
PAYMENTS AND PREPAYMENTS
3.1 Principal Payments. (a) Unless earlier payment is required under
this Agreement, the Company shall pay to the Lenders on the Termination Date the
entire outstanding principal amount of the Syndicated Loans.
(b) Unless earlier payment is required under this Agreement,
the Canadian Borrower shall pay to the Canadian Lenders on the Termination Date
the entire outstanding principal amount of the Canadian Syndicated Loans.
(c) Unless earlier payment is required under this Agreement,
the Company shall, on the maturity date of any Bid-Option Loan, pay to the
Lender providing such Bid-Option Loan the outstanding principal amount of such
Loan.
(d) If at any time the Dollar Equivalent of the aggregate
Canadian Syndicated Loans exceeds the Activated Aggregate Canadian Commitments,
upon the request of any Lender the Canadian Borrower shall prepay the Canadian
Syndicated Loans in an amount equal to or greater than such excess.
(e) If at any time the Dollar Equivalent of the aggregate
Syndicated Loans, Swingline Loans and Letters of Credit exceeds the aggregate
U.S. Commitments, upon the request of any Lender the Borrowers shall prepay the
Advances in an amount equal to or greater than such excess.
(f) The Company may at any time and from time to time
optionally prepay all or a portion of the Loans without premium in the case of
Syndicated Loans, provided that (i) in the case of the prepayment of Fixed Rate
Loans, the Company shall provide five Business Days notice to the Agent, and
(ii) in the case of the prepayment of Fixed Rate Loans prior to the last day of
the then current Interest Period with respect to such Loan, the Company shall
pay the Lenders for any funding losses and loss of profits incurred by the
Lenders as a result of any prepayment of such Loans.
3.2 Interest Payments. Each Borrower shall pay interest to the Lenders
on the unpaid principal amount of each Loan made to it (other than Bid-Option
Loans, for which the interest shall be payable directly to the Lender providing
such Bid-Option Loan as described in clauses (b) and (c) below), for the period
commencing on the date such Loan is made until such Loan is paid in full, on
each Interest Payment Date and at maturity (whether at stated maturity, by
acceleration or otherwise), and thereafter on demand, at the following rates per
annum:
(a) With respect to Syndicated Loans:
(i) During such periods that such Loan is a Floating
Rate Loan, the Floating Rate.
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(ii) During such periods that such Loan is a Eurodollar
Rate Syndicated Loan, the Syndicated Eurodollar Rate applicable to such Loan for
each related Eurodollar Interest Period.
(iii) During such periods that such Loan is a BA Rate
Syndicated Loan, the BA Rate applicable to such Loan for each related BA
Interest Period.
(b) With respect to Absolute Rate Bid-Option Loans, the
Bid-Option Absolute Rate quoted for such Loan by the Lender making such Loan.
(c) With respect to each Eurodollar Rate Bid-Option Loan, the
Bid-Option Eurodollar Rate.
(d) With respect to Swingline Loans, the rate agreed to by
the Agent and the Company, provided that Swingline Loans shall bear interest at
the rate applicable to Floating Rate Loans at any time the Swingline Loans are
refunded by Floating Rate Loans or the Lenders are required to purchase
participations therein under Section 2.1(c)(iii).
Notwithstanding anything to the contrary contained in this Agreement, during the
continuance of a Default or Event of Default the Required Lenders may, at their
option, by notice to the Borrowers (which notice may be revoked at the option of
the Required Lenders notwithstanding any provision of Section 8.1 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no
Advance may be made as or converted into a Fixed Rate Loan or, at the end of any
existing Interest Period, continued as a Fixed Rate Loan. Notwithstanding
anything to the contrary contained in this Agreement, during the continuance of
an Event of Default the Required Lenders may, at their option, by notice to the
Borrowers (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.1 requiring unanimous consent of the
Lenders to changes in interest rates), declare that each Borrower pay interest
on demand at the Overdue Rate on the outstanding principal amount of any Loan
owing by it and any other amount payable by it hereunder (other than interest),
provided that, during the continuance of an Event of Default under Section
6.1(i), the Overdue Rate as described above shall be applicable without any
election or action on the part of the Agent or any Lender.
3.3 Letter of Credit Reimbursement Payments. (a)(i) The Company agrees
to pay to the Lenders, on the day on which the Agent shall honor a draft or
other demand for payment presented or made under any Letter of Credit, an amount
equal to the amount paid by the Agent in respect of such draft or other demand
under such Letter of Credit and all expenses paid or incurred by the Agent
relative thereto. Unless the Company shall have made such payment to the Lenders
on such day, upon each such payment by the Agent, the Agent shall be deemed to
have disbursed to the Company for whose benefit the Letter of Credit was issued,
and the Company shall be deemed to have elected to satisfy its reimbursement
obligation by, a Syndicated Loan bearing interest at the Floating Rate for the
account of the Lenders in an amount equal to the amount so paid by the Agent in
respect of such draft or other demand under such Letter of Credit. Such
Syndicated Loan shall be disbursed notwithstanding any failure to satisfy any
conditions for disbursement of any Loan set forth in Article II hereof and, to
the extent of the Syndicated Loan so disbursed, the reimbursement obligation of
the Company under this Section 3.3 shall be deemed satisfied; provided, however,
that nothing in this Section 3.3 shall be deemed to constitute a waiver of any
Default or Event of Default caused by the failure to the conditions for
disbursement or otherwise.
(ii) If, for any reason (including without limitation as
a result of the occurrence of an Event of Default with respect to the Company
pursuant to Section 6.1(i)), Floating Rate
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Loans may not be made by the Lenders as described in Section 3.3(a)(i), then (A)
the Company agrees that each reimbursement amount not paid pursuant to the first
sentence of Section 3.3(a)(i) shall bear interest, payable on demand by the
Agent, at the interest rate then applicable to Floating Rate Loans, and (B)
effective on the date each such Floating Rate Loan would otherwise have been
made, each Lender severally agrees that it shall unconditionally and
irrevocably, without regard to the occurrence of any Default or Event of
Default, in lieu of deemed disbursement of loans, to the extent of such Lender's
Commitment, purchase a participating interest in each reimbursement amount. Each
Lender will immediately transfer to the Agent, in Same Day Funds, the amount of
its participation. Each Lender shall share, based on its Pro Rata Share, in any
interest which accrues thereon and in all repayments thereof. If and to the
extent that any Lender shall not have so made the amount of such participating
interest available to the Agent, such Lender and the Company severally agree to
pay to the Agent forthwith on demand such amount together with interest thereon,
for each day from the date of demand by the Agent until the date such amount is
paid to the Agent, at (x) in the case of the Company, the interest rate then
applicable to Floating Rate Loans and (y) in the case of such Lender, the
Federal Funds Rate.
(b) The reimbursement obligation of the Company under this
Section 3.3 shall be absolute, unconditional and irrevocable and shall remain in
full force and effect until all obligations of the Company to the Lenders
hereunder shall have been satisfied, and such obligations of the Company shall
not be affected, modified or impaired upon the happening of any event, including
without limitation, any of the following, whether or not with notice to, or the
consent of, the Company:
(i) Any lack of validity or enforceability of any Letter
of Credit or any documentation relating to any Letter of Credit or to any
transaction related in any way to such Letter of Credit (the "Letter of Credit
Documents");
(ii) Any amendment, modification, waiver, consent, or
any substitution, exchange or release of or failure to perfect any interest in
collateral or security, with respect to any of the Letter of Credit Documents;
(iii) The existence of any claim, setoff, defense or
other right which the Company may have at any time against any beneficiary or
any transferee of any Letter of Credit (or any Persons or entities for whom any
such beneficiary or any such transferee may be acting), the Agent or any Lender
or any other Person or entity, whether in connection with any of the Letter of
Credit Documents, the transactions contemplated herein or therein or any
unrelated transactions;
(iv) Any draft or other statement or document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect;
(v) Payment by the Agent to the beneficiary under any
Letter of Credit against presentation of documents which do not comply with the
terms of the Letter of Credit, including failure of any documents to bear any
reference or adequate reference to such Letter of Credit;
(vi) Any failure, omission, delay or lack on the part of
the Agent or any Lender or any party to any of the Letter of Credit Documents to
enforce, assert or exercise any right, power or remedy conferred upon the Agent,
any Lender or any such party under this Agreement or any of the Letter of Credit
Documents, or any other acts or omissions on the part of the Agent, any Lender
or any such party;
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(vii) Any other event or circumstance that would, in the
absence of this clause, result in the release or discharge by operation of law
or otherwise of the Company from the performance or observance of any
obligation, covenant or agreement contained in this Section 3.3.
No setoff, counterclaim, reduction or diminution of any obligation or any
defense of any kind or nature which the Company has or may have against the
beneficiary of any Letter of Credit shall be available hereunder to the Company
against the Agent or any Lender. Nothing in this Section 3.3 shall limit the
liability, if any, of the Lenders to the Company pursuant to Section 8.5.
3.4 Applicable Lending Office; Payment Method. (a) Each Lender will
book its Loans at the appropriate Applicable Lending Office listed on
administrative information sheets provided to the Agent (or as established by
the Agent from time to time in the case of Bank One, which shall be Bank One
Canada in the case of Loans to the Canadian Borrower) in connection herewith or
such other Applicable Lending Office designated by such Lender in accordance
with the final sentence of this Section 3.4(a). All terms of this Agreement
shall apply to any such Applicable Lending Office and the Loans and any Notes
issued hereunder shall be deemed held by each Lender for the benefit of any such
Applicable Lending Office. Each Lender may, by written notice to the Agent and
the Borrowers, designate replacement or additional Applicable Lending Office
through which Loans will be made by it and for whose account Loan payments are
to be made.
(b) All payments to be made by the Company hereunder will be
made to the Agent at its applicable Agent Payment Office for the account of the
Lenders in U.S. Dollars and in Same Day Funds not later than 1:00 p.m. (Detroit
time) on the date on which such payment shall be due. All payments to be made by
the Canadian Borrower with respect to Canadian Syndicated Loans hereunder will
be made to the Agent at its applicable Agent Payment Office the account of the
Canadian Lenders in Canadian Dollars and in Same Day Funds not later than 1:00
p.m. (Toronto time) on the date on which such payment shall be due. Payments
received after 1:00 p.m. at the place for payment shall be deemed to be payments
made prior to 1:00 p.m. at the place for payment on the next succeeding Business
Day. The Borrowers hereby authorize the Agent to charge their respective
accounts with the Agent in order to cause timely payment of amounts due
hereunder to be made (subject to sufficient funds being available in such
account for that purpose).
(c) At the time of making each such payment, each Borrower
shall, subject to the other terms and conditions of this Agreement, specify to
the Agent that Borrowing or other obligation of such Borrower hereunder to which
such payment is to be applied. In the event that such Borrower fails to so
specify the relevant obligation or if an Event of Default shall have occurred
and be continuing, the Agent may apply such payments as it may determine in its
sole discretion to obligations of such Borrower to the Lenders arising under the
Loan Documents.
(d) On the day such payments are deemed received, the Agent
shall remit to the Lenders their Pro Rata Share of such payments in Same Day
Funds, to the Lenders at their respective Applicable Lending Offices.
3.5 No Setoff or Deduction. Subject to Section 3.11, all payments of
principal of and interest on the Loans and other amounts payable by the
Borrowers hereunder shall be made by the Borrowers without setoff or
counterclaim, and free and clear of, and without deduction or withholding for,
or on account of, any present or future taxes, levies, imposts, duties, fees,
assessments, or other charges of whatever nature, imposed by any governmental
authority, or by any department, agency or other political subdivision or taxing
authority, unless required by applicable laws. If any such taxes, levies,
imposts, duties, fees, assessments, or
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other charges are required to be withheld from any amounts payable hereunder
with respect to any Advance, the amounts so payable shall be increased to the
extent necessary to yield to the payee thereof the interest or any such other
amounts payable hereunder at the rates and in the amounts specified in this
Agreement.
3.6 Payment on Non-Business Day; Payment Computations. Except as
otherwise provided in this Agreement to the contrary, whenever any installment
of principal of, or interest on, any Loan outstanding hereunder or any other
amount due hereunder becomes due and payable on a day which is not a Business
Day, the maturity thereof shall be extended to the next succeeding Business Day
and, in the case of any installment of principal, interest shall be payable
thereon at the rate per annum determined in accordance with this Agreement
during such extension. Computations of interest and other amounts due under this
Agreement shall be made on the basis of a year of 360 days for the actual number
of days elapsed, including the first day but excluding the last day of the
relevant period. For the purposes of the Interest Act (Canada) hereunder (i)
whenever interest payable pursuant to this Agreement is calculated with respect
to any monetary obligation relating to Loans to the Canadian Borrower on the
basis of a period other than a calendar year (the "Calculation Period"), each
rate of interest determined pursuant to such calculation expressed as an annual
rate is equivalent to such rate as so determined, multiplied by the actual
number of days in the calendar year in which the same is to be ascertained and
divided by the number of days in the Calculation Period; (ii) the principle of
deemed reinvestment of interest with respect to any monetary obligation relating
to Loans in Canadian Dollars shall not apply to any interest calculation under
this agreement, and (iii) the rates of interest with respect to any monetary
obligation relating to Loans to the Canadian Borrower stipulated in this
Agreement are intended to be nominal rates and not effective rates or yields.
3.7 Additional Costs. (a) If the adoption of or any change in any law,
treaty, rule or regulation (whether domestic or foreign) applicable to any
Lender or the Agent, or in any interpretation, application or administration
thereof by any governmental authority charged with the interpretation or
administration thereof, or compliance by any Lender or the Agent with any
directive of any such authority (whether or not having the force of law) made
subsequent to the Effective Date, shall (i) affect the basis of taxation of
payments to any Lender or the Agent of any amounts payable by a Borrower under
this Agreement (other than taxes imposed on the overall net income of the Lender
or the Agent, by the jurisdiction, or by any political subdivision or taxing
authority of any such jurisdiction, in which any Lender or the Agent, as the
case may be, has its principal office or is otherwise advancing or booking any
Loan hereunder), or (ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by any Lender or the Agent, as the case may
be, or (iii) shall impose any other condition with respect to this Agreement,
the Commitments, the Notes or the Advances, and the result of any of the
foregoing is to increase the cost to any Lender or the Agent, as the case may
be, of making, funding or maintaining any Fixed Rate Loan or to reduce the
amount of any sum receivable by any Lender or the Agent, thereon, then such
Borrower shall pay to such Lender or the Agent, as the case may be, from time to
time, upon request by such Lender (with a copy of such request to be provided to
the Agent) or the Agent, additional amounts sufficient to compensate such Lender
or the Agent, as the case may be, for such increased cost or reduced sum
receivable to the extent, such Lender or the Agent, as the case may be, is not
compensated therefor in the computation of the interest rate applicable to such
Loan. Each Lender or the Agent, as the case may be, seeking compensation
hereunder shall deliver to such Borrower a statement setting forth such
increased cost or reduced sum receivable as such Lender or the Agent, as the
case may be, has calculated in good faith. Such statement as to the amount of
such increased cost or reduced sum receivable, prepared in good faith and in
reasonable detail by such Lender or the Agent, as the case may be, and submitted
by such Lender or the Agent, as the case may be, to such Borrower, shall be
conclusive and binding for all purposes absent manifest error in computation.
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(b) If the adoption of or any change in any law, treaty, rule
or regulation (whether domestic or foreign) applicable to any Lender or the
Agent, but applicable to banks or financial institutions generally, or in any
interpretation or administration thereof by any governmental authority charged
with the interpretation, application or administration thereof, or compliance by
any Lender or the Agent with any directive of any such authority (whether or not
having the force of law), including any risk-based capital guidelines made
subsequent to the Effective Date, affects the amount of capital required or
expected to be maintained by such Lender or the Agent (or any corporation
controlling such Lender or the Agent) and such Lender or the Agent, as the case
may be, determines that the amount of such capital is increased by or based upon
the existence of such Lender's or the Agent's obligations hereunder to any
Borrower and such increase has the effect of reducing the rate of return on such
Lender's or the Agent's (or such controlling corporation's) capital as a
consequence of such obligations hereunder to a level below that which such
Lender or the Agent (or such controlling corporation) could have achieved but
for such circumstances (taking into consideration its policies with respect to
capital adequacy) by an amount deemed by such Lender or the Agent to be
material, then such Borrower shall pay to such Lender or the Agent, as the case
may be, from time to time, upon request by such Lender (with a copy of such
request to be provided to the Agent) or the Agent, additional amounts sufficient
to compensate such Lender or the Agent (or such controlling corporation) for any
reduced rate of return which such Lender or the Agent reasonably determines to
be allocable to the existence of such Lender's or the Agent's obligations
hereunder. Each Lender or the Agent, as the case may be, seeking compensation
hereunder shall deliver to each such Borrower a statement setting forth such
increased cost or reduced sum receivable as such Lender or the Agent, as the
case may be, has calculated in good faith. Such statement as to the amount of
such compensation, prepared in good faith and in reasonable detail by such
Lender or the Agent, as the case may be, and submitted by such Lender or the
Agent to such Borrower, shall be conclusive and binding for all purposes absent
manifest error in computation.
(c) Each Lender will promptly notify the affected Borrower
and the Agent of any event of which it has actual knowledge occurring after the
date hereof which will entitle to such Lender to compensation pursuant to this
Section 3.7 and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Lender, be otherwise disadvantageous to
such Lender or contrary to its policies.
3.8 Illegality and Impossibility. In the event that any applicable law,
treaty, rule or regulation (whether domestic or foreign) now or hereafter in
effect and whether or not presently applicable to any Lender, or any
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof, or compliance by any Lender
with any directive of such authority (whether or not having the force of law),
including without limitation exchange controls, shall make it unlawful or
impossible for any Lender to maintain any Fixed Rate Loan under this Agreement
or shall make it impracticable, unlawful or impossible for, or shall in any way
limit or impair the ability of, a Borrower to make or any Lender to receive any
payment under this Agreement at the place specified for payment hereunder, or to
freely convert any amount paid into U.S. Dollars at market rates of exchange or
to transfer any amount paid or so converted to the address of its principal
office specified in Section 8.2, such Borrower shall upon receipt of notice
thereof from such Lender, repay in full the then outstanding principal amount of
each Fixed Rate Loan so affected, together with all accrued interest thereon to
the date of payment and all amounts owing to such Lender under Section 3.9, (a)
on the last day of the then current Interest Period applicable to such Loan if
such Lender may lawfully continue to maintain such Loan to such day, or (b)
immediately if such Lender may not continue to maintain such Loan to such day.
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3.9 Indemnification. If a Borrower makes any payment of principal with
respect to any Fixed Rate Loan on any other date than the last day of an
Interest Period applicable thereto (whether pursuant to Section 3.8 or Section
6.2 or otherwise), or if a Borrower fails to borrow or continue any Fixed Rate
Loan, or convert any Floating Rate Loan to a Fixed Rate Loan, after notice has
been given to the Lenders in accordance with Section 2.6 or 2.9, as applicable,
such Borrower shall reimburse each Lender on demand for any resulting net loss
or expense incurred by each such Lender after giving credit for any earnings or
other quantifiable financial benefit to such Lender from such Lender's
investment or other amounts prepaid or not reborrowed, including without
limitation any loss incurred in obtaining, liquidating or employing deposits
from third parties, whether or not such Lender shall have funded or committed to
fund such Loan. A statement as to the amount of such loss or expense, prepared
in good faith and in reasonable detail by such Lender and submitted by such
Lender to such Borrower, shall be conclusive and binding for all purposes absent
manifest error in computation. Calculation of all amounts payable to such Lender
under this Section 3.9 shall be made as though such Lender shall have actually
funded or committed to fund the relevant Fixed Rate Loan through the purchase of
an underlying deposit in an amount equal to the amount of such Loan and having a
maturity comparable to the related Interest Period; provided, however, that such
Lender may fund any Fixed Rate Loan in any manner it sees fit and the foregoing
assumption shall be utilized only for the purpose of calculation of amounts
payable under this Section 3.9.
3.10 Substitution of Lender. If (a) the obligation of any Lender to
make or maintain Eurodollar Rate Syndicated Loans has been suspended pursuant to
Section 3.8 or 2.10 when not all Lenders obligations have been suspended, (b)
any Lender has demanded compensation under Section 3.7 or (c) any Lender is a
Defaulting Lender, the Borrowers shall have the right, if no Default or Event of
Default then exists, to replace such Lender (a "Replaced Lender") with one or
more other Lenders (collectively, the "Replacement Lender") acceptable to the
Agent, provided that (i) at the time of any replacement pursuant to this Section
3.10, the Replacement Lender shall enter into one or more Assignment and
Acceptances, pursuant to which the Replacement Lender shall acquire the
Commitments and outstanding Advances and other obligations of the Replaced
Lender and, in connection therewith, shall pay to the Replaced Lender in respect
thereof an amount equal to the sum of (A) the amount of principal of, and all
accrued interest on, all outstanding Loans of the Replaced Lender, (B) the
amount of all accrued, but theretofore unpaid, fees owing to the Replaced Lender
under Section 2.3 and (C) the amount which would be payable by the Borrowers to
the Replaced Lender pursuant to Section 3.9 if the Borrowers prepaid at the time
of such replacement all of the Loans of such Replaced Lender outstanding at such
time and (ii) all obligations of the Borrowers then owing to the Replaced Lender
(other than those specifically described in clause (i) above in respect of which
the assignment purchase price has been, or is concurrently being, paid) shall be
paid in full to such Replaced Lender concurrently with such replacement. Upon
the execution of the respective Assignment and Acceptances, the payment of
amounts referred to in clauses (i) and (ii) above and, if so requested by the
Replacement Lender, delivery to the Replacement Lender of the appropriate Note
or Notes, if any, executed by the Borrowers, the Replacement Lender shall become
a Lender hereunder and the Replaced Lender shall cease to constitute a Lender
hereunder. The provisions of this Agreement (including without limitation
Sections 3.9 and 8.5) shall continue to govern the rights and obligations of a
Replaced Lender with respect to any Advances made or any other actions taken by
such Lender while it was a Lender. Nothing herein shall release any Defaulting
Lender from any obligation it may have to the Borrowers, the Agent or any other
Lender.
3.11 Taxes. (a) At least five Business Days prior to the first date on
which interest or fees are payable hereunder for the account of any U.S. Lender,
each U.S. Lender that is not incorporated under the laws of the United States of
America or a state thereof agrees that it will deliver to each of the Company
and the Agent two duly completed copies of United States Internal Revenue
Service Form W-
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8BEN or W-8ECI and Form W-8 or W-9 and any additional forms necessary for
claiming complete exemption from United States withholding taxes (or any
successor or substitute forms), certifying in either case that such U.S. Lender
is entitled to receive payments under this Agreement and the Loans without
deduction or withholding of any United States federal income taxes. Each U.S.
Lender which so delivers a Form W-8BEN or W-8ECI and a Form W-8 or W-9 and any
additional forms necessary for claiming complete exemption from United States
withholding taxes (or any successor or substitute forms) further undertakes to
deliver to each of the Company and the Agent two additional copies of such forms
(or any successor or substitute forms) on or before the date that such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Company
or the Agent to the extent it may lawfully do so, in each case certifying that
such U.S. Lender is entitled to receive payments under this Agreement and the
Loans without deduction or withholding of any United States federal income
taxes, unless an event (including without limitation any change in treaty, law
or regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such U.S. Lender from duly completing and delivering any such form with
respect to it and such U.S. Lender advises the Company and the Agent that it is
not capable of receiving payments without any deduction or withholding of United
States federal income tax.
(b) Each Canadian Lender that is created or organized under
the laws of a jurisdiction other than Canada or a Province thereof making
Canadian Syndicated Loans shall deliver, or have its Applicable Lending Office
to be used to make Canadian Syndicated Loans deliver, to the Borrowers and the
Agent on the Effective Date (or on the date on which such Canadian Lender or
such Applicable Lending Office becomes a Lender hereunder), evidence that either
(i) such Canadian Lender or its Applicable Lending Office is an authorized
foreign bank and that any payments received by such Canadian Lender or its
Applicable Lending Office under the Canadian Syndicated Loans is in respect of
such entity's Canadian banking business, all for the purposes of subsection
112(13.3) of the Income Tax Act (Canada), or (ii) the Minister of National
Revenue is satisfied that payments made to such Lender hereunder are not subject
to Canadian withholding taxes pursuant to Regulation 805(2) of the Income Tax
Act (collectively, "Evidence of Canadian Tax Exemption"). In addition, from time
to time after the Effective Date (or the date on which such Canadian Lender
becomes a Lender hereunder) upon the reasonable request of the Borrowers or the
Agent, each such Canadian Lender further agrees to deliver to the Borrowers and
the Agent further Evidence of Canadian Tax Exemption, unless any change in
treaty, law, regulation or official interpretation thereof prevents such Lender
from duly providing same. Notwithstanding anything in this Section 3.11 to the
contrary, the Borrowers shall not have any obligation to pay any withholding
taxes or to indemnify any Canadian Lender for any withholding taxes to the
extent that such taxes result from the failure of such Lender to comply with its
obligations under this paragraph.
(c) If any governmental authority of any jurisdiction asserts
a claim that the Agent did not properly withhold tax from amounts paid to or for
the account of any Lender (because the appropriate form was not delivered or was
not properly executed, or because such Lender failed to notify the 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 Agent fully for all amounts paid, directly or indirectly, by the
Agent as tax or otherwise, including penalties and interest, and including any
taxes imposed by any jurisdiction on the amounts payable to the Agent under this
Section, together with all costs and expenses (including attorney costs). The
obligations of the Lenders under this subsection shall survive the payment of
all Loans.
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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants to the Agent and the Lenders
that:
4.1 Corporate Existence and Power. It is a corporation duly organized,
validly existing and in good standing under the laws of the state, province or
other political subdivision of its jurisdiction of incorporation or
organization, as the case may be, and is duly qualified to do business, and is
in good standing, in all additional jurisdictions where such qualification is
necessary under applicable law, except where the failure to be so qualified
would not have a Material Adverse Effect. It has all requisite corporate and
other power to own or lease the properties used in its business and to carry on
its business as now being conducted and as proposed to be conducted, and to
execute and deliver this Agreement and the other Loan Documents to which it is a
party and to engage in the transactions contemplated by the Loan Documents.
4.2 Corporate Authority. The execution, delivery and performance by it
of the Loan Documents to which it is a party have been duly authorized by all
necessary corporate action and are not in contravention of any material law,
rule or regulation, or any judgment, decree, writ, injunction, order or award of
any arbitrator, court or governmental authority, or of the terms of its charter
or by-laws, or of any material contract or undertaking to which it is a party or
by which it or its property is bound or affected and do not result in the
imposition of any Lien except for Permitted Liens.
4.3 Binding Effect. The Loan Documents to which it is a party are the
legal, valid and binding obligations of it enforceable against it in accordance
with their respective terms; except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to creditors' rights and except that the remedy of specific performance
and injunctive and other forms of equitable relief are subject to equitable
defenses and to the discretion of the court before which any proceedings may be
brought.
4.4 Subsidiaries. Schedule 4.4 hereto correctly sets forth the
corporate name, jurisdiction of organization and ownership of each Subsidiary of
the Company. Each Subsidiary and each Person becoming a Subsidiary of the
Company after the date hereof is and will be duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization and is
and will be duly qualified to do business in each additional jurisdiction where
such qualification is or may be necessary under applicable law, except where the
failure to be so qualified would not have a Material Adverse Effect. Each
Subsidiary of the Company has and will have all requisite corporate power to own
or lease the properties used in its business and to carry on its business as now
being conducted and as proposed to be conducted. All outstanding shares of
Capital Stock of each Subsidiary of the Company have been and will be validly
issued and are and will be fully paid and nonassessable and, except as otherwise
indicated in Schedule 4.4 hereto or disclosed in writing to the Agent from time
to time, are and will be owned, beneficially and of record, by the Company or
another Subsidiary of the Company free and clear of any Liens.
4.5 Litigation and Contingent Obligations. Except as set forth in
Schedule 4.5 hereto, there is no action, suit or proceeding pending or, to the
best of the Company's knowledge, threatened against or affecting the Company or
any of its Subsidiaries before or by any court, governmental authority or
arbitrator, which is reasonably likely to result either individually or
collectively, in a Material Adverse Effect and, to the best of the Company's
knowledge, there is no basis for any such action, suit or proceeding. Other than
any liability incident to any litigation, arbitration or proceeding which (i)
could not reasonably be
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expected to have a Material Adverse Effect or (ii) is set forth on Schedule 4.5,
neither the Company nor any of its Subsidiaries has any material contingent
obligations not provided for or disclosed in the financial statements referred
to in Section 4.6.
4.6 Financial Condition. The consolidated balance sheet of the Company
and its Subsidiaries and the consolidated statements of income, and cash flows
of the Company and its Subsidiaries for the fiscal year ended December 29, 2001
and reported on by Arthur Andersen LLP, independent certified public
accountants, and the interim consolidated balance sheet and interim consolidated
statements of income and cash flows of the Company and its Subsidiaries, as of
or for the six month period ended on June 29, 2002, copies of which have been
furnished to the Lenders, fairly present, and the financial statements of the
Company and its Subsidiaries delivered pursuant to Section 5.1(d) will fairly
present the consolidated financial position of the Company and its Subsidiaries
as at the respective dates thereof, and the consolidated results of operations
of the Company and its Subsidiaries for the respective periods indicated, all in
accordance with Generally Accepted Accounting Principles consistently applied
(subject, in the case of said interim statements, to year-end audit
adjustments). There has been no Material Adverse Effect since the date of the
consolidated balance sheet of the Company delivered to the Lenders prior to the
Effective Date.
4.7 Use of Loans. The Borrowers will use the proceeds of the Loans for
their working capital requirements and general corporate purposes. Neither the
Company nor any of its Subsidiaries extends or maintains, in the ordinary course
of business, credit for the purpose, whether immediate, incidental, or ultimate,
of buying or carrying margin stock (within the meaning of Regulations T, U or X
of the Board of Governors of the Federal Reserve System), and no part of the
proceeds will be used in violation of Regulations T, U or X or any other law or
regulation. After applying the proceeds of each Loan, such margin stock will not
constitute more than 25% of the value of the assets (either of any Borrower
alone or of the Company and its Subsidiaries on a consolidated basis) that are
subject to any provisions of this Agreement that may cause the Loans to be
deemed secured, directly or indirectly, by such margin stock.
4.8 No Conflict; Consents, Etc. Neither the execution and delivery by
any Borrower of the Loan Documents to which it is a party, nor the consummation
of the transactions therein contemplated, nor compliance with the provisions
thereof will violate (i) any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on any Borrower or any of their Subsidiaries
or (ii) each Borrower's or any Subsidiary's articles or certificate of
incorporation, articles or certificate of organization, by-laws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which either Borrower or any of their
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in, or
require, the creation or imposition of any Lien in, of or on the Property of the
Company or a Subsidiary pursuant to the terms of any such indenture, instrument
or agreement. Except for such consents, approvals, authorizations, declarations,
registrations or filings delivered by the Borrower pursuant to Section 2.7(j),
if any, each of which is in full force and effect, no consent, approval or
authorization of or declaration, registration or filing with any governmental
authority or any nongovernmental Person, including without limitation any
creditor, lessor or stockholder of any Borrower or Guarantor, is required on the
part of any Borrower or Guarantor in connection with the execution, delivery and
performance of the Loan Documents, or the transactions contemplated hereby or as
a condition to the legality, validity or enforceability of the Loan Documents.
The Company and its Subsidiaries have complied with all applicable statutes,
rules, regulations, orders and restrictions of any domestic or foreign
government or any instrumentality or agency thereof having jurisdiction over the
conduct of their respective businesses or the ownership of their respective
properties if failure to comply therewith could reasonably be expected to have a
Material Adverse Effect.
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4.9 Taxes. The Company and its Subsidiaries have filed all material tax
returns (federal, state and local) required to be filed and have paid all taxes
shown thereon to be due, including interest and penalties, or have established
adequate financial reserves on their respective books and records for payment
thereof except where the failure to file such returns, pay such taxes or
establish such reserves would not have a Material Adverse Effect.
4.10 Title to Properties. Except as otherwise disclosed in the latest
balance sheet delivered pursuant to this Agreement, the Company or one or more
of its Subsidiaries have good and marketable fee simple title to all of the real
property, and a valid and indefeasible ownership interest in all of the other
properties and assets reflected in said balance sheet or subsequently acquired
by the Company or any such Subsidiary material to the business or financial
condition of the Company and its Subsidiaries taken as a whole, except for title
defects that do not have a Material Adverse Effect. All of such properties and
assets are free and clear of any Lien, except for Permitted Liens. The Company
and each of its Subsidiaries owns, or is licensed to use, all patents,
trademarks, trade names, service marks, copyrights, technology, know-how and
processes necessary for the conduct of its business as currently conducted and
as contemplated to be conducted (the "Intellectual Property"), and the use of
such Intellectual Property by the Company and each of its Subsidiaries does not
infringe on the rights of any Person. The Pledge Agreements grant a first
priority, perfected and enforceable lien and security interest on 65% of the
Capital Stock of certain Foreign Subsidiaries owned by the Company or any
Guarantor to the extent that 65% of the Capital Stock of such Foreign
Subsidiaries is required to be pledged by Section 2.13.
4.11 ERISA. The Company, its Subsidiaries, their ERISA Affiliates and
their respective Plans are in substantial compliance in all material respects
with those provisions of ERISA and of the Code which are applicable with respect
to any Plan. No Prohibited Transaction and no Reportable Event has occurred with
respect to any such Plan which would cause an Event of Default. Neither the
Company, any of its Subsidiaries nor any of their ERISA Affiliates is an
employer with respect to any Multiemployer Plan. The Company, its Subsidiaries
and their ERISA Affiliates have met the minimum funding requirements under ERISA
and the Code with respect to each of their respective Plans, if any, and have
not incurred any liability to the PBGC, other than premiums which are not yet
due and payable. The execution, delivery and performance of the Loan Documents
does not constitute a Prohibited Transaction. There is no material unfunded
benefit liability, determined in accordance with Section 4001(a)(18) of ERISA,
with respect to any Plan of the Company, its Subsidiaries or their ERISA
Affiliates.
4.12 Environmental and Safety Matters. Except as disclosed on Schedule
4.12 hereto, the Company and each Subsidiary of the Company is in substantial
compliance with all material federal, state and local laws, ordinances and
regulations relating to safety and industrial hygiene or to the environmental
condition, including without limitation all material Environmental Laws in
jurisdictions in which the Company or any such Subsidiary owns or operates, or
has owned or operated, a facility or site, or arranges or has arranged for
disposal or treatment of hazardous substances, solid waste, or other wastes,
accepts or has accepted for transport any hazardous substances, solid wastes or
other wastes or holds or has held any interest in real property or otherwise. No
written demand, claim, notice, suit, suit in equity, action, administrative
action, investigation or inquiry whether brought by any governmental authority,
private Person or otherwise, arising under, relating to or in connection with
any Environmental Laws is pending or, to the best of the Company's actual
knowledge, threatened against the Company or any such Subsidiary, any real
property in which the Company or any such Subsidiary holds or has held an
interest or any past or present operation of the Company or any such Subsidiary
which could have a Material Adverse Effect. As of the date hereof, except as
disclosed in Schedule 4.12 hereto, neither the Company nor any Subsidiary of the
Company (a) is the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to
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a release of any toxic substances, radioactive materials, hazardous wastes or
related materials into the environment, or (b) has received any notice of any
toxic substances, radioactive materials, hazardous waste or related materials
in, or upon any of its properties in violation of any Environmental Laws. As to
the matters disclosed in Schedule 4.12 hereto, none could have a Material
Adverse Effect. No release, threatened release or disposal of hazardous waste,
solid waste or other wastes is occurring or has occurred on, under or to any
real property in which the Company or any of its Subsidiaries holds any interest
or performs any of its operations, in violation of any Environmental Law which
could have a Material Adverse Effect.
4.13 Material Agreements. Neither the Company nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Company nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
4.14 Compliance With Laws. The Company and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective property except for any failure
to comply with any of the foregoing which could not reasonably be expected to
have a Material Adverse Effect.
4.15 Plan Assets; Prohibited Transactions. Neither Borrower is an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. Section
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and neither the execution of this Agreement nor the making of
Advances hereunder gives rise to a Prohibited Transaction.
4.16 Investment Company Act. Neither Borrower nor any Subsidiary is an
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
4.17 Public Utility Holding Company Act. Neither Borrower nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
4.18 Insurance. The certificate signed by the chief financial officer
or treasurer of the Company, that attests to the existence and adequacy of, and
summarizes, the property and casualty insurance program carried by the Company
with respect to itself and its Subsidiaries and that has been furnished by the
Company to the Agent and the Lenders, is complete and accurate. This summary
includes the insurer's or insurers' name(s), policy number(s), expiration
date(s), amount(s) of coverage, type(s) of coverage, exclusion(s), and
deductibles. This summary also includes similar information, and describes any
reserves, relating to any self-insurance program that is in effect.
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ARTICLE V.
COVENANTS
5.1 Affirmative Covenants. Each Borrower covenants and agrees that,
until the Termination Date and thereafter until irrevocable payment in full of
the principal of and accrued interest on the Advances and the performance of all
other obligations of the Obligors under the Loan Documents, unless the Required
Lenders shall otherwise consent in writing, it shall, and shall cause each of
its Subsidiaries to:
(a) Preservation of Corporate Existence, Etc. Do or cause to
be done all things necessary to preserve, renew and keep in full force and
effect its legal existence, except to the extent permitted by Section 5.2(e) or
5.2(f), and its qualification as a foreign corporation in good standing in each
jurisdiction in which such qualification is necessary under applicable law,
other than where failure to so qualify will not have a Material Adverse Effect.
(b) Compliance with Laws, Etc. Comply in all material
respects with all applicable laws, rules, regulations and orders of any
governmental authority, whether federal, state, local or foreign (including
without limitation ERISA, the Code and Environmental Laws), in effect from time
to time, and pay and discharge promptly when due all taxes, assessments and
governmental charges or levies imposed upon it or upon its income, revenues or
property, before the same shall become delinquent or in default, as well as all
lawful claims for labor, materials and supplies or otherwise, which, if unpaid,
might give rise to Liens upon such properties or any portion thereof, except (i)
to the extent that payment of any of the foregoing is then being contested in
good faith by appropriate legal proceedings or (ii) to the extent that failure
to pay any of the foregoing or comply with any of the foregoing relates solely
to Subsidiaries which are not wholly-owned Subsidiaries of the Company or
Guarantors and if all such non wholly-owned Subsidiaries do not, if considered
in the aggregate as a single Subsidiary, constitute a Significant Subsidiary and
such failure could not have a Material Adverse Effect (but the Company shall
provide notice to the Agent of the occurrence of any such failure to comply or
failure to pay described in this proviso).
(c) Maintenance of Properties; Insurance. Maintain, preserve
and protect all property that is material to the conduct of the business of the
Company or any of its Subsidiaries and keep such property in good repair,
working order and condition and from time to time make, or cause to be made all
needful and proper repairs, renewals, additions, improvements and replacements
thereto necessary in order that the business carried on in connection therewith
may be properly conducted at all times in accordance with customary and prudent
business practices for similar businesses; and, maintain in full force and
effect insurance with responsible and reputable insurance companies or
associations in such amounts, on such terms and covering such risks, as is
usually carried by companies engaged in similar businesses and owning similar
properties similarly situated and maintain in full force and effect public
liability insurance, insurance against claims for Personal injury or death or
property damage occurring in connection with any of its activities or any
properties owned, occupied or controlled by it, in such amount as it shall
reasonably deem necessary.
(d) Reporting Requirements. Furnish to the Lenders and the
Agent the following:
(i) Promptly and in any event within three calendar days
after becoming aware of the occurrence of any Event of Default or Default and
promptly and in any event within thirty calendar days after the commencement of
any litigation against, by or affecting the Company or any of its Subsidiaries
which could reasonably be expected to have a Material Adverse Effect, and any
material developments therein, written notice thereof together with a statement
of the chief financial officer of the Company setting forth details of such
Event of Default or Default or such litigation and the action which the Company
or such Subsidiary, as the case may be, has taken and proposes to take with
respect thereto;
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(ii) 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, the consolidated balance sheet of the Company and its
Subsidiaries as of the end of such quarter, and the related consolidated
statements of income and cash flow for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter, setting forth in
each case in comparative form the corresponding figures for the corresponding
date or period of the preceding fiscal year, all in reasonable detail and duly
certified (subject to year-end audit adjustments) by the chief financial officer
of the Company as having been prepared in accordance with Generally Accepted
Accounting Principles, together with a certificate of the chief financial
officer of the Company stating (A) that no Event of Default or Default has
occurred and is continuing or, if an Event of Default or Default has occurred
and is continuing, a statement setting forth the details thereof and the action
which the Company has taken and proposes to take with respect thereto, and (B)
that a computation (which computation shall accompany such certificate and shall
be in reasonable detail) showing compliance with Section 5.2(a), (b), and (c);
(iii) 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
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such fiscal year and the related consolidated statements of income and cash flow
of the Company and its Subsidiaries for such fiscal year, with a customary audit
report of Ernst & Young LLP or other nationally recognized independent certified
public accountants selected by the Company, without qualifications unacceptable
to the Agent, together with a certificate of the chief financial officer of the
Company stating (A) that no Event of Default or Default has occurred and is
continuing or, if an Event of Default or Default has occurred and is continuing,
a statement setting forth the details thereof and the action which the Company
has taken and proposes to take with respect thereto, and (B) that a computation
(which computation shall accompany such certificate and shall be in reasonable
detail) showing compliance with Section 5.2(a), (b), and (c);
(iv) As soon as available and in any event within 90
days after the beginning of each fiscal year of the Company, a budget and
forecast for such fiscal year in form and substance reasonably satisfactory to
the Agent;
(v) Promptly after the sending or filing thereof, copies
of all reports, proxy statements and financial statements which the Company
sends to or files with any of its security holders or any securities exchange or
the Securities and Exchange Commission or any successor agency thereof;
(vi) Promptly and in any event within 10 Business Days
after receiving or becoming aware thereof (A) a copy of any notice of intent to
terminate any Plan of the Company, its Subsidiaries or any ERISA Affiliate filed
with the PBGC, (B) a statement of the chief financial officer of the Company
setting forth the details of the occurrence of any Reportable Event with respect
to any such Plan, (C) a copy of any notice that the Company, any of its
Subsidiaries or any ERISA Affiliate may receive from the PBGC relating to the
intention of the PBGC to terminate any such Plan or to appoint a trustee to
administer any such Plan, (D) a copy of any notice of failure to make a required
installment or other payment within the meaning of Section 412(n) of the Code or
Section 302(f) of ERISA with respect to any such Plan, or (E) any management
letter or comparable analysis received by the Company from its auditors; and
(vii) Promptly, such other information respecting the
business, properties, operations or condition, financial or otherwise, of the
Company or any of its Subsidiaries as any Lender or the Agent may from time to
time reasonably request.
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(e) Accounting; Access to Records, Books, Etc. Maintain a
system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in accordance
with Generally Accepted Accounting Principles and to comply with the
requirements of this Agreement and, at any reasonable time and from time to time
with prior notice to the Company, permit any Lender or the Agent or any agents
or representatives thereof to examine and make copies of and abstracts from the
records and books of account of, and visit the properties of, the Company and
its Subsidiaries, and to discuss the affairs, finances and accounts of the
Company and its Subsidiaries with its directors, officers, employees and
independent auditors, provided that representatives of the Company selected by
the Company are present during any such visit or discussion, and by this
provision the Company does hereby authorize such Persons to discuss such
affairs, finances and accounts with any Lender or the Agent subject to the above
terms and conditions. The Company shall send a written notification to its
auditors informing them at each time the Company engages any auditors that it is
the primary intent of the Company for the auditors' accounting services to
benefit or influence the Lenders and the Agent.
(f) Guaranties and Pledge Agreements. Cause each Person that
is or becomes a Guarantor from time to time promptly to execute and deliver a
Guaranty to the Lenders and execute or cause the appropriate Guarantor to
execute, additional Pledge Agreements or amendments to existing Pledge
Agreements to grant the liens and security interests required under Section 2.13
hereof, in each case together with the other documentation relating to such
Guaranty or Pledge Agreement similar to that required to be delivered by or on
behalf of the Obligors under Section 2.7.
(g) Further Assurances. Will, and will cause each Guarantor
to, execute and deliver within 30 days after request therefor by the Required
Lenders or the Agent, all further instruments and documents and take all further
action that may be necessary or desirable, in order to give effect to, and to
aid in the exercise and enforcement of the rights and remedies of the Lenders
and the Agent under, the Loan Documents. In addition, the Company agrees to
deliver to the Agent and the Lenders from time to time upon the acquisition or
creation of any Subsidiary not listed in Schedule 4.4 hereto supplements to
Schedule 4.4 such that such Schedule, together with such supplements, shall at
all times accurately reflect the information provided for thereon.
5.2 Negative Covenants. Until the Termination Date and thereafter until
irrevocable payment in full of the principal of and accrued interest on the
Advances, and the performance of all other obligations of the Obligors under
Loan Documents, each Borrower agrees that, unless the Required Lenders shall
otherwise consent in writing, it shall not, and shall not permit any of its
Subsidiaries to:
(a) Leverage Ratio. Permit or suffer the Adjusted Leverage
Ratio to be greater than 0.60 to 1.0 at any time.
(b) Interest Coverage Ratio. Permit or suffer the Interest
Coverage Ratio to be less than 2.5 to 1.0 as of the end of any fiscal quarter.
(c) Net Worth. Permit or suffer the Net Worth at any time to
be less than $220,000,000, plus 50% of Consolidated net income of the Company
and its Subsidiaries for the fiscal quarter of the Company ending in December,
2002 and each fiscal year of the Company ending thereafter, provided that if
such Consolidated net income of the Company and its Subsidiaries is negative for
the fiscal quarter ending in December, 2002 or any fiscal year thereafter, as
the case may be, the amount added for such fiscal quarter or year shall be zero
and it shall not reduce the amount added for any other fiscal year, and plus 75%
of the net proceeds from the sale or other issuance of any Capital Stock of the
Company.
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(d) Liens. Create, incur or suffer to exist any Lien on any
of the assets, rights, revenues or property, real, personal or mixed, tangible
or intangible, whether now owned or hereafter acquired, of the Company or any of
its Subsidiaries, other than:
(i) Liens for taxes not delinquent or for taxes being
contested in good faith by appropriate proceedings and as to which adequate
financial reserves have been established on its books and records;
(ii) Liens (other than any Lien imposed by ERISA)
created and maintained in the ordinary course of business which are not material
in the aggregate, which would not have a Material Adverse Effect and which
constitute (A) pledges or deposits under worker's compensation laws,
unemployment insurance laws or similar legislation, (B) good faith deposits in
connection with bids, tenders, contracts or leases to which the Company or any
of its Subsidiaries is a party for a purpose other than borrowing money or
obtaining credit, including rent security deposits, (C) liens imposed by law,
such as those of carriers, warehousemen and mechanics, if payment of the
obligation secured thereby is not yet due, (D) Liens securing taxes, assessments
or other governmental charges or levies not yet subject to penalties for
nonpayment, and (E) pledges or deposits to secure public or statutory
obligations of the Company or any of its Subsidiaries, or surety, customs or
appeal bonds to which the Company or any of its Subsidiaries is a party;
(iii) Liens affecting real property which constitute
minor survey exceptions or defects or irregularities in title, minor
encumbrances, easements or reservations of, or rights of others for, rights of
way, sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning or other restrictions as to the use of such real property,
provided that all of the foregoing, in the aggregate, do not at any time
materially detract from the value of said properties or materially impair their
use in the operation of the businesses of the Company and its Subsidiaries taken
as a whole;
(iv) Each Lien described in Schedule 5.2(d) hereto may
be suffered to exist upon the same terms as those existing on the date hereof,
including extensions, renewals and replacements thereof so long as such
extension, renewal or replacement does not increase the principal amount of the
Indebtedness secured or extend such Lien to any other property, assets, rights
or revenues;
(v) (A) any Lien on equipment to secure any rights
granted with respect to such equipment in connection with the provision of all
or a part of the purchase price of such equipment created contemporaneously
with, or within 180 days after such acquisition, or (B) any Lien in property
existing in such property at the time of acquisition thereof, whether or not the
debt secured thereby is assumed by the Company or a Subsidiary, (C) any Lien
existing in the property of a corporation at the time such corporation is merged
into or consolidated with the Company or a Subsidiary or at the time of a sale,
lease, or other disposition of the properties of a corporation or firm as an
entirety or substantially as an entirety to the Company or a Subsidiary, or (D)
any Lien on any other fixed assets of the Company or any of its Subsidiaries;
provided, in the case of (A), (B), (C) and (D), no such Liens shall exceed the
fair market value of the related property, not more than one such Lien shall
encumber such property at any one time and the aggregate outstanding
Indebtedness secured by all such Liens does not exceed an amount equal to 15% of
Net Worth;
(vi) Liens granted by any Subsidiary in favor of the
Company or any other Subsidiary;
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(vii) The interest or title of a lessor under any lease
otherwise permitted under this Agreement with respect to the property subject to
such lease to the extent performance of the obligations of the Company or its
Subsidiary thereunder is not delinquent; and
(viii) Liens on up to 65% of the present and future
Capital Stock of Foreign Subsidiaries to the extent required to be pledged under
Section 2.13 hereof, provided that such Liens secure only the Lender
Obligations, the Senior Note Debt and the other Subject Obligations and are
subject to an Intercreditor Agreement.
(e) Merger; Etc. Merge or consolidate or amalgamate with any
other Person or take any other action having a similar effect, provided,
however, (i) a Subsidiary of the Company may merge with the Company, provided
that the Company shall be the surviving corporation, (ii) a Subsidiary of the
Company may merge, consolidate or amalgamate with another Subsidiary of the
Company, and (iii) the Company or any Subsidiary may merge, consolidate or
amalgamate with any other Person in connection with an Acquisition, provided
that such Acquisition is permitted by Section 5.2(h) and satisfies the
conditions described therein and the Company or such Subsidiary shall be the
surviving corporation.
(f) Disposition of Assets; Etc. Sell, lease, license,
transfer, assign or otherwise dispose of any material portion of its business,
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether in one or a series of transactions, other than inventory
sold in the ordinary course of business upon customary credit terms and sales of
scrap or obsolete material or equipment, provided, however, that this Section
5.2(f) shall not prohibit any such sale, lease, license, transfer, assignment or
other disposition if the aggregate book value (disregarding any write-downs of
such book value other than ordinary depreciation and amortization) of all of the
business, assets, rights, revenues and property disposed of after the date of
this Agreement shall be less than 10% of such aggregate book value of the
Consolidated total assets of the Company and its Subsidiaries as of the most
recently ended fiscal year, and if immediately after such transaction, no
Default or Event of Default shall exist or shall have occurred and be
continuing. Notwithstanding the foregoing, (i) any Subsidiary may sell, lease,
transfer or otherwise dispose of its assets to the Company or any Guarantor,
(ii) the Company or any Subsidiary may sell, lease, transfer or otherwise
dispose of its fixed assets in excess of the limitation set forth above so long
as such sale is not all or substantially all of its fixed assets and the
proceeds of such sale are used to purchase other property of a similar nature of
at least equivalent value within 180 days of such sale or (iii) the Company or
any Subsidiary may sell, lease, transfer or otherwise dispose of its assets in
excess of the limitation set forth above so long as the proceeds of such sale
are used to prepay Advances and permanently reduce the Commitments by such
amount.
(g) Nature of Business. Make or suffer any substantial change
in the nature of its business from that engaged in on the date hereof or engage
in any other businesses other than those in which it is engaged on the date
hereof, which are directly related to the businesses in which it is engaged in
on the date hereof or which are not material in the aggregate.
(h) Investments, Loans and Advances. Purchase or otherwise
acquire any Capital Stock of or other ownership interest in, or debt securities
of or other evidences of Indebtedness of, any other Person; nor acquire all or
any material portion of the assets of any Person; nor make any other
Acquisition; nor make any loan or advance of any of its funds or property or
make any other extension of credit to, or make any investment or acquire any
interest whatsoever in, any other Person; nor permit any Subsidiary to do any of
the foregoing; other than (i) extensions of trade credit made in the ordinary
course of
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business on customary credit terms and commission, travel, relocation and
similar advances made to officers and employees in the ordinary course of
business, (ii) investments, loans and advances in and to the Company or any
Guarantor, (iii) investments in Cash Equivalents, and (iv) Acquisitions,
provided each of the following conditions is satisfied: (A) there is no Default
or Event of Default either before or after such Acquisition, (B) the
representations and warranties contained in this Agreement shall be true and
correct as if made on and as of the date such Acquisition is consummated, both
before and after giving effect thereto, (C) if such Acquisition involves the
acquisition of Capital Stock, the consummation of such Acquisition has been
recommended by the board of directors and management of the target of such
Acquisition, and (D) if the total consideration, cash or non-cash, paid or
payable for such Acquisition is greater than $25,000,000, prior to the
consummation of such Acquisition, the Company shall deliver a satisfactory pro
forma covenants compliance certificate to the Agent and the target of such
Acquisition is in the same line of business as conducted by the Company as of
the Effective Date or a line of business similar thereto or that supports such
business, (v) other investments, loans and advances described on Schedule 5.2(h)
hereto, and (vi) other investments, loans and advances in aggregate outstanding
amount not to exceed an amount equal to 15% of Net Worth.
(i) Negative Pledge Limitation. Enter into any agreement with
any Person other than the Agent and the Lenders pursuant hereto which prohibits
or limits the ability of the Company or any of its Subsidiaries to create,
incur, assume or suffer to exist any Lien upon any of its assets, rights,
revenues or property, real, Personal or mixed, tangible or intangible, whether
now owned or hereafter acquired, except for Permitted Liens or other
restrictions contained in security agreements securing Indebtedness permitted
hereby to the extent such provisions restrict the transfer of the property
subject to such security agreements.
(j) Indebtedness and Contingent Liabilities of
Non-Guarantors. Create, incur, assume or in any manner become liable in respect
of or suffer to exist, any Indebtedness or Contingent Liabilities of any
Subsidiaries that are not Guarantors other than (i) the Canadian Syndicated
Loans and (ii) such other Indebtedness or Contingent Liabilities in aggregate
outstanding amount not to exceed an amount equal to 10% of Net Worth.
(k) Dividends and Other Restricted Payments Make, pay,
declare or authorize any dividend, payment or other distribution in respect of
any class of its Capital Stock or any dividend, payment or distribution in
connection with the redemption, purchase, retirement or other acquisition,
directly or indirectly, of any shares of its Capital Stock if a Default or Event
of Default exists or would be caused thereby. The Company will not issue any
Disqualified Stock.
(l) Transactions with Affiliates. Make any payment to, or
sell, lease, transfer or otherwise dispose of any of its properties or assets
to, or purchase any property or assets from, or enter into or make or amend any
transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliates (each of the foregoing, an
"Affiliate Transaction") unless such Affiliate Transaction is on terms that are
no less favorable to the Company or the relevant Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Subsidiary with an unrelated Person.
(m) Financial Contracts. Enter into or remain a party to any
Financial Contract for purposes of financial speculation, provided that hedging
by the Company or any of its Subsidiaries of their own interest rate or foreign
currency exposure shall not be deemed financial speculation.
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5.3 Additional Covenants. If at any time a Borrower shall enter into or
be a party to any instrument or agreement, including all such instruments or
agreements in existence as of the date hereof and all such instruments or
agreements entered into after the date hereof, relating to or amending any
provisions applicable to any of its Indebtedness which in the aggregate,
together with any related Indebtedness, exceeds $17,500,000, which includes
covenants or defaults not substantially provided for in this Agreement or more
favorable to the lender or lenders thereunder than those provided for in this
Agreement, then such Borrower shall promptly so advise the Agent and the
Lenders. Thereupon, if the Agent or the Required Lenders shall request, upon
notice to such Borrower, the Agent and the Lenders shall enter into an amendment
to this Agreement or an additional agreement (as the Agent may request),
providing for substantially the same covenants and defaults as those provided
for in such instrument or agreement to the extent required and as may be
selected by the Agent.
ARTICLE VI.
DEFAULT
6.1 Events of Default. The occurrence of any one of the following
events or conditions shall be deemed an "Event of Default" hereunder unless
waived by the Required Lenders pursuant to Section 8.1:
(a) Nonpayment of Principal. A Borrower shall fail to pay
when due any principal of the Advances or any reimbursement obligation under
Section 3.3; or
(b) Nonpayment of Interest. A Borrower shall fail to pay when
due any interest or any fees or any other amount payable hereunder and such
failure shall remain unremedied for three Business Days; or
(c) Misrepresentation. Any representation or warranty made by
a Borrower or any Guarantor in this Agreement, any other Loan Document or any
other certificate, report, financial statement or other document furnished by or
on behalf of a Borrower or any Guarantor in connection with this Agreement shall
prove to have been incorrect in any material respect when made or deemed made;
or
(d) Certain Covenants. A Borrower shall fail to perform or
observe any term, covenant or agreement contained in Section 5.1(d)(i) or 5.2
hereof; or
(e) Other Defaults. A Borrower or any Guarantor shall fail to
perform or observe any other term, covenant or agreement contained in this
Agreement or any other Loan Document, and any such failure shall remain
unremedied for 30 calendar days (or 10 days in the case of any failure to
perform or observe the covenants contained in Sections 5.2(d)(ii), (iii) or
(iv)) after notice thereof shall have been given to such Borrower or such
Guarantor, as the case may be, by the Agent; or
(f) Cross Default. The Company or any of its Subsidiaries
shall fail to pay any part of the principal of, the premium, if any, or the
interest on, or any other payment of money due under any of its Indebtedness
(other than Indebtedness hereunder), beyond any period of grace provided with
respect thereto, which individually or together with other such Indebtedness as
to which any such failure exists has an aggregate outstanding principal amount
in excess of $5,000,000; or if the Company or any of its Subsidiaries fails to
perform or observe any other term, covenant or agreement contained in any
agreement, document or instrument evidencing or securing any such Indebtedness
having such aggregate outstanding principal amount, or under which any such
Indebtedness was issued or created, beyond any period of grace, if any,
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provided with respect thereto, or any other event shall occur or condition
exist, the effect of which failure to observe or perform or the occurrence of
such event or condition is to cause, or to permit the holder or holders of such
Indebtedness to cause, such Indebtedness to become due prior to its stated
maturity or declared to be due and payable or required to be prepaid or
repurchased prior to the stated maturity thereof; provided, however, that an
Event of Default shall not be deemed to have occurred under this Section 6.1(f)
if any of the foregoing events occurs only with respect to Subsidiaries which
are not wholly owned Subsidiaries of the Company or Guarantors and if all such
non wholly owned Subsidiaries do not, if considered in the aggregate as a single
Subsidiary, constitute a Significant Subsidiary but the Company shall provide
notice to the Agent of the occurrence of any such event described in this
proviso; or
(g) Judgments. One or more judgments or orders for the
payment of money in an aggregate amount of $5,000,000 shall be rendered against
the Company or any of its Subsidiaries, or any other judgment or order (whether
or not for the payment of money) shall be rendered against or shall affect the
Company or any of its Subsidiaries which causes or could cause a Material
Adverse Effect, and either (i) such judgment or order shall have remained
unsatisfied or uninsured for a period of 30 days and the Company or such
Subsidiary shall not have taken action necessary to stay enforcement thereof by
reason of pending appeal or otherwise, prior to the expiration of the applicable
period of limitations for taking such action or, if such action shall have been
taken, a final order denying such stay shall have been rendered, or (ii)
enforcement proceedings shall have been commenced by any creditor upon any such
judgment or order; provided, however, that an Event of Default shall not be
deemed to have occurred under this Section 6.1(g) if any of the foregoing events
occurs only with respect to Subsidiaries which are not wholly owned Subsidiaries
of the Company or Guarantors and if all such non wholly owned Subsidiaries do
not, if considered in the aggregate as a single Subsidiary, constitute a
Significant Subsidiary; or
(h) ERISA. The occurrence of a Reportable Event that results
in or could result in liability in excess of $5,000,000 of the Company, any
Subsidiary of the Company or their ERISA Affiliates to the PBGC or to any Plan
and such Reportable Event is not corrected within thirty (30) days after the
occurrence thereof; or the occurrence of any Reportable Event which could
constitute grounds for termination of any Plan of the Company, its Subsidiaries
or their ERISA Affiliates by the PBGC or for the appointment by the appropriate
United States District Court of a trustee to administer any such Plan and such
Reportable Event is not corrected within thirty (30) days after the occurrence
thereof; or the filing by the Company, any Subsidiary of the Company or any of
their ERISA Affiliates of a notice of intent to terminate a Plan or the
institution of other proceedings to terminate a Plan; or the Company, any
Subsidiary of the Company or any of their ERISA Affiliates shall fail to pay
when due any liability to the PBGC or to a Plan; or the PBGC shall have
instituted proceedings to terminate, or to cause a trustee to be appointed to
administer, any Plan of the Company, its Subsidiaries or their ERISA Affiliates;
or any Person engages in a Prohibited Transaction with respect to any Plan which
results in or could result in liability of the Company, any Subsidiary of the
Company, any of their ERISA Affiliates, any Plan of the Company, its
Subsidiaries or their ERISA Affiliates or fiduciary of any such Plan; or failure
by the Company, any Subsidiary of the Company or any of their ERISA Affiliates
to make a required installment or other payment to any Plan within the meaning
of Section 302(f) of ERISA or Section 412(n) of the Code that results in or
could result in liability in excess of $5,000,000 of the Company, any Subsidiary
of the Company or any of their ERISA Affiliates to the PBGC or any Plan; or the
withdrawal of the Company, any of its Subsidiaries or any of their ERISA
Affiliates from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(9a)(2) of ERISA; or the Company, any of its
Subsidiaries or any of their ERISA Affiliates becomes an employer with respect
to any Multiemployer Plan without the prior written consent of the Required
Lenders; provided, however, that this Section 6.1(h) shall apply only to events
or occurrences which, when aggregated with all other events and occurrences
described in this Section 6.1(h), could result in liability to the Company or
its Subsidiaries greater than $5,000,000; or
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(i) Insolvency, Etc. The Company or any of its Subsidiaries
shall be dissolved or liquidated (or any judgment, order or decree therefor
shall be entered), or shall generally not pay its debts as they become due, or
shall admit in writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors, or shall institute, or there
shall be instituted against the Company or any of its Subsidiaries, any
proceeding or case seeking to adjudicate it a bankrupt or insolvent or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief or protection of debtors or seeking the
entry of an order for relief, or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
assets, rights, revenues or property, and, if such proceeding is instituted
against the Company or such Subsidiary and is being contested by the Company or
such Subsidiary, as the case may be, in good faith by appropriate proceedings,
such proceeding shall remain undismissed or unstayed for a period of 60 days; or
the Company or such Subsidiary shall take any action (corporate or other) to
authorize or further any of the actions described above in this subsection;
provided, however, that an Event of Default shall not be deemed to have occurred
under this Section 6.1(i) if any of the foregoing events occurs only with
respect to Subsidiaries which are not wholly owned Subsidiaries of the Company
or Guarantors and if all such non wholly owned Subsidiaries do not, if
considered in the aggregate as a single Subsidiary, constitute a Significant
Subsidiary; or
(j) Change of Control. The occurrence of any Change of
Control; or
(k) Guaranties. Any Guaranty shall fail to remain in full
force or effect or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of any Guaranty, or any Guarantor shall fail to
comply with any of the terms or provisions of any Guaranty to which it is a
party, or any Guarantor shall deny that it has any further liability under any
Guaranty to which it is a party, or shall give notice to such effect; or
(l) Pledge Agreements. Any Pledge Agreement shall for any
reason fail to create a valid and perfected first priority security interest in
any collateral purported to be covered thereby, or any Pledge Agreement shall
fail to remain in full force or effect or any action shall be taken to
discontinue or to assert the invalidity or unenforceability of any Pledge
Agreement, or any Obligor shall fail to comply with any of the terms or
provisions of any Pledge Agreement.
6.2 Remedies. (a) Upon the occurrence and during the continuance of any
Event of Default, the Agent upon being directed to do so by the Required
Lenders, shall by notice to the Borrowers (i) terminate the Commitments or (ii)
declare the outstanding principal of, and accrued interest on, the Notes and
Advances and all other amounts owing under this Agreement to be immediately due
and payable, or (iii) demand immediate delivery of cash collateral, and the
Borrowers agree to deliver such cash collateral upon demand, in an amount equal
to the maximum amount that may be available to be drawn at any time prior to the
stated expiry of all outstanding Letters of Credit, or any one or more of the
foregoing, whereupon the Commitments shall terminate forthwith and all such
amounts, including cash collateral, shall become immediately due and payable,
provided that in the case of any event or condition described in Section 6.1(i)
with respect to the Borrowers, the Commitments shall automatically terminate
forthwith and all such amounts, including cash collateral, shall automatically
become immediately due and payable without notice; in all cases without demand,
presentment, protest, diligence, notice of dishonor or other formality, all of
which are hereby expressly waived. Such cash collateral delivered in respect of
outstanding Letters of Credit shall be deposited in a special cash collateral
account to be held by the Agent as collateral security for the payment and
performance of the Borrowers' obligations under this Agreement to the Lenders
and the Agent.
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(b) The Agent upon being directed to do so by the Required
Lenders, shall, in addition to the remedies provided in Section 6.2(a), exercise
and enforce any and all other rights and remedies available to it or the
Lenders, whether arising under the Loan Documents or under applicable law, in
any manner deemed appropriate by the Agent, including suit in equity, action at
law, or other appropriate proceedings, whether for the specific performance (to
the extent permitted by law) of any covenant or agreement contained in the Loan
Documents or in aid of the exercise of any power granted in the Loan Documents.
(c) Upon the occurrence and during the continuance of any
Event of Default, each Lender may at any time and from time to time exercise any
of its rights of set off or bankers lien that it may possess by common law or
statute without prior notice to the Borrowers, provided that each Lender may
also set off against any deposit whether or not it is then matured. Each Lender
agrees to promptly notify the Borrowers after any such setoff and application,
provided that the failure to give such notice shall not effect the validity of
such setoff and application. The rights of such Lender under this Section 6.2(c)
are in addition to other rights and remedies which such Lender may have.
(d) All proceeds of any realization on the collateral
pursuant to the Pledge Agreements and any payments received by the Agent or any
Lender pursuant to the Guaranties subsequent to and during the continuance of
any Event of Default, subject to any Intercreditor Agreement, shall be allocated
and distributed by the Agent as follows:
(i) First, to the payment of all reasonable costs and
expenses, including without limitation all reasonable attorneys' fees, of the
Agent in connection with the enforcement of the Pledge Agreement and the
Guaranties and otherwise administering this Agreement;
(ii) Second, to the payment of all fees required to be
paid under any Loan Document including facility fees, owing to the Lenders and
Agent pursuant to the Lender Obligations on a pro rata basis in accordance with
the Lender Obligations consisting of fees owing to the Lenders and Agent under
the Lender Obligations, for application to payment of such liabilities;
(iii) Third, to the Lenders and Agent on a pro rata
basis in accordance with the Lender Obligations consisting of interest owing to
the Lenders and Agent under the Lender Obligations, and obligations and
liabilities relating to Rate Hedging Agreements owing to the Lenders and the
Agent under the Lender Obligations for application to payment of such
liabilities;
(iv) Fourth, to the Lenders and the Agent on a pro rata
basis in accordance with the Lender Obligations consisting of principal
(including without limitation any cash collateral for any outstanding Letters of
Credit), for application to payment of such liabilities;
(v) Fifth, to the payment of any and all other amounts
owing to the Lenders and the Agent and secured by the Pledge Agreements on a pro
rata basis in accordance with the total amount of such Indebtedness owing to
each of the Lenders and the Agent, for application to payment of such
liabilities; and
(vi) Sixth, to the applicable Borrower, their
Subsidiaries or such other Person as may be legally entitled thereto.
For the purposes of the above payments and distributions, the full amount of
Lender Obligations on account of any Letter of Credit then outstanding but not
drawn upon shall be deemed to be then due and owing.
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Amounts distributable to the Lenders or Agent on account of such Lender
Obligations under such Letters of Credit shall be deposited in a separate
collateral account in the name of and under the control of the Agent and held by
the Agent first as security for such Letter of Credit Lender Obligations and
then as security for all other Lender Obligations and the amount so deposited
shall be applied to the Letter of Credit Lender Obligations at such times and to
the extent that such Letter of Credit Lender Obligations become absolute
liabilities and if and to the extent that the Letter of Credit Lender
Obligations fail to become absolute Lender Obligations because of the expiration
or termination of the underlying Letters of Credit without being drawn upon then
such amounts shall be applied to the remaining Lender Obligations in the order
provided in this Section 6.2(d). The Company hereby grants to the Agent, for the
benefit of the Lenders and Agent, a lien and security interest in all such funds
deposited in such separate collateral account, as security for all the Lender
Obligations as set forth above.
(e) Notwithstanding anything herein to the contrary, no
payments of principal, interest or fees delivered to the Agent for the account
of any Defaulting Lender shall be delivered by the Agent to such Defaulting
Lender. Instead, such payments shall, for so long as such Defaulting Lender
shall be a Defaulting Lender, be held by the Agent, and the Agent is hereby
authorized and directed by all parties hereto to hold such funds in escrow and
apply such funds as follows:
(i) First, if applicable to any payments due from such
Defaulting Lender to the Agent, and
(ii) Second, Loans required to be made by such
Defaulting Lender on any borrowing date to the extent such Defaulting Lender
fails to make such Loans.
Notwithstanding the foregoing, upon the termination of all Commitments and the
payment and performance of all of the Advances and other obligations owing
hereunder (other than those owing to a Defaulting Lender), any funds then held
in escrow by the Agent pursuant to the preceding sentence shall be distributed
to each Defaulting Lender, pro rata in proportion to amounts that would be due
to each Defaulting Lender but for the fact that it is a Defaulting Lender.
ARTICLE VII.
THE AGENT AND THE LENDERS
7.1 Appointment; Nature of Relationship. Bank One, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
VII. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of the term "secured party" as defined in the Uniform Commercial
Code and (iii) is acting as an independent contractor, the rights and duties of
which are limited to those expressly set forth in this Agreement and the other
Loan Documents. Each of the Lenders hereby agrees to assert no claim against the
Agent on any agency theory or any other theory of liability for breach of
fiduciary duty, all of which claims each Lender hereby waives.
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7.2 Powers. The Agent shall have and may exercise such powers under the
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
7.3 General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrowers, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
7.4 No Responsibility for Loans, Recitals, etc. Neither the Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into, or verify (a) any statement, warranty
or representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any Obligor under any Loan Document, including, without
limitation, any agreement by an Obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article II; (d) the
existence or possible existence of any Default or Event of Default; (e) the
validity, enforceability, effectiveness, sufficiency or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith;
(f) the value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of any Borrower or any
Guarantor of any of the Lender Obligations or of any such Borrowers' or any such
Guarantor's respective Subsidiaries. The Agent shall have no duty to disclose to
the Lenders information that is not required to be furnished by the Borrowers to
the Agent at such time, but is voluntarily furnished by the Borrowers to the
Agent (either in its capacity as Agent or in its individual capacity).
7.5 Action on Instructions of Lenders. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
7.6 Employment of Agents and Counsel. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
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7.7 Reliance on Documents; Counsel. The Agent shall be entitled to rely
upon any notice, consent, certificate, affidavit, letter, telegram, statement,
paper or document believed by it to be genuine and correct and to have been
signed or sent by the proper Person or Persons, and, in respect to legal
matters, upon the opinion of counsel selected by the Agent, which counsel may be
employees of the Agent.
7.8 Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrowers for which the Agent is entitled to reimbursement by
the Borrowers under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of the Loan
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including, without limitation, for any such
amounts incurred by or asserted against the Agent in connection with any dispute
between the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms of the Loan Documents or of any such other
documents, provided that no Lender shall be liable for any of the foregoing to
the extent any of the foregoing is found in a final non-appealable judgment by a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of the Agent. The obligations of the Lenders under this
Section 7.8 shall survive payment of the Lender Obligations and termination of
this Agreement.
7.9 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder unless
the Agent has 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". In the event that the Agent receives such a
notice, the Agent shall give prompt notice thereof to the Lenders.
7.10 Rights as a Lender. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with a Borrower or
any of its Subsidiaries in which such Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person.
7.11 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrowers and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
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7.12 Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrowers, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrowers and the Lenders, a successor Agent, provided that, if no
Default or Event of Default has occurred and is continuing, such appointment
shall be made in consultation with the Borrowers. If no successor Agent shall
have been so appointed by the Required Lenders within thirty days after the
resigning Agent's giving notice of its intention to resign, then the resigning
Agent may appoint, on behalf of the Borrowers and the Lenders, a successor
Agent. Notwithstanding the previous sentence, the Agent may at any time without
the consent of the Borrowers or any Lender, appoint any of its Affiliates which
is a commercial bank as a successor Agent hereunder. If the Agent has resigned
or been removed and no successor Agent has been appointed, the Lenders may
perform all the duties of the Agent hereunder and the Borrowers shall make all
payments in respect of the Lender Obligations to the applicable Lender and for
all other purposes shall deal directly with the Lenders. No successor Agent
shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article VII shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 7.12, then the term "Prime Rate" as used in this Agreement shall mean
the base rate, prime rate or other analogous rate of the new Agent.
7.13 Delegation to Affiliates. The Borrowers and the Lenders agree that
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under the Loan Documents.
7.14 Sharing of Payments. The Lenders agree among themselves that, in
the event that any Lender shall obtain payment in respect of any Advance or any
other obligation owing to the Lenders under this Agreement (other than payments
received pursuant to Section 3.7, payments of principal or interest on
Bid-Option Loans at a time when no Event of Default or Default is continuing,
pro rata payments of principal or interest to all Canadian Lenders on Canadian
Syndicated Loans at a time when no Event of Default or Default is continuing and
pro rata payments of principal or interest to all U.S. Lenders on U.S.
Syndicated Loans at a time when no Event of Default or Default is continuing)
through the exercise of a right of set-off, banker's lien, counterclaim or
otherwise in excess of its ratable share of payments received by all of the
Lenders on account of the Advances and other obligations (or if no Advances are
outstanding, ratably according to the respective amounts of the Commitments),
such Lender shall promptly purchase from the other Lenders participations in
such Advances and other obligations in such amounts, and
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make such other adjustments from time to time, as shall be equitable to the end
that all of the Lenders share such payment in accordance with such ratable
shares. The Lenders further agree among themselves that if payment to a Lender
obtained by such Lender through the exercise of a right of set-off, banker's
lien, counterclaim or otherwise as aforesaid shall be rescinded or must
otherwise be restored, each Lender which shall have shared the benefit of such
payment shall, by repurchase of participations theretofore sold, return its
share of that benefit to each Lender whose payment shall have been rescinded or
otherwise restored. The Borrowers agree that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including set-off, banker's lien or counterclaim, with respect to
such participation as fully as if such Lender were a holder of such Advance or
other obligation in the amount of such participation. The Lenders further agree
among themselves that, in the event that amounts received by the Lenders and the
Agent hereunder are insufficient to pay all such obligations or insufficient to
pay all such obligations when due, the fees and other amounts owing to the Agent
in such capacity shall be paid therefrom before payment of obligations owing to
the Lenders under this Agreement. Except as otherwise expressly provided in this
Agreement, if any Lender or the Agent shall fail to remit to the Agent or any
other Lender an amount payable by such Lender or the Agent to the Agent or such
other Lender pursuant to this Agreement on the date when such amount is due,
such payments shall be made together with interest thereon for each date from
the date such amount is due until the date such amount is paid to the Agent or
such other Lender at a rate per annum equal to the rate at which borrowings are
available to the payee in its overnight federal funds market. It is further
understood and agreed among the Lenders and the Agent that if the Agent or any
Lender shall engage in any other transactions with the Borrowers and shall have
the benefit of any collateral or security therefor which does not expressly
secure the obligations arising under this Agreement except by virtue of a
so-called dragnet clause or comparable provision, the Agent or such Lender shall
be entitled to apply any proceeds of such collateral or security first in
respect of the obligations arising in connection with such other transaction
before application to the obligations arising under this Agreement.
7.15 Execution of Collateral Documents. The Lenders hereby empower and
authorize the Agent to execute and deliver to the Obligors on their behalf the
Pledge Agreements and all related documents or instruments as shall be necessary
or appropriate to effect the purposes of the Pledge Agreements. The Lenders
further empower and authorize the Agent to execute and deliver on their behalf
the Intercreditor Agreement and all related documents or instruments as shall be
necessary or appropriate to effect the purposes of the Intercreditor Agreement,
provided that the form of the Intercreditor Agreement has been approved by the
Required Lenders, and each Lender shall be bound by the terms and provisions of
the Intercreditor Agreement so executed by the Agent.
7.16 Collateral Releases. The Lenders hereby empower and authorize the
Agent to execute and deliver to the Obligors on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of collateral which shall be permitted by the terms hereof, including
without limitation any collateral held under the Pledge Agreements which is
permitted to be sold under the terms of this Agreement, or of any other Loan
Document or which shall otherwise have been approved by the Required Lenders
(or, if required, all of the Lenders) in writing.
7.17 Co-Agents, Syndication Agent, Documentation Agent, etc. Neither
any of the Lenders identified in this Agreement or otherwise as a "co-agent" nor
the Syndication Agent nor the 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
such Lenders shall have or be deemed to have a fiduciary relationship with any
Lender. Each Lender hereby makes the same acknowledgments with respect to such
Lenders as it makes with respect to the Agent in Section 7.11.
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ARTICLE VIII.
MISCELLANEOUS
8.1 Amendments, Etc. (a) No amendment, modification, termination or
waiver of any provision of this Agreement nor any consent to any departure
therefrom shall be effective unless the same shall be in writing and signed by
the Borrowers and the Required Lenders and, to the extent any rights or duties
of the Agent may be affected thereby, the Agent, and to the extent the
obligations of the Canadian Lenders are affected thereby, the Required Canadian
Lenders, provided, however, that no such amendment, modification, termination,
waiver or consent shall, without the consent of the Agent and each Lender
affected, (i) authorize or permit the extension of time for, or any reduction of
the amount of, any payment of the principal of, or interest on, the Notes or any
Letter of Credit reimbursement obligation, or any fees or other amount payable
hereunder, (ii) except as provided herein, increase the respective Commitment of
any Lender or modify the provisions of this Section regarding the taking of any
action under this Section or the definition of Required Lenders or Required
Canadian Lenders, (iii) provide for the discharge of any Guarantor except as a
result of a transaction otherwise permitted by this Agreement, or (iv) provide
for the release of all or substantially all of the collateral subject to the
Pledge Agreements except as a result of a transaction otherwise permitted by
this Agreement.
(b) Any such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
(c) Notwithstanding anything herein to the contrary, no
Defaulting Lender shall be entitled to vote (whether to consent or to withhold
its consent) with respect to any amendment, modification, termination or waiver
of any provision of this Agreement or any departure therefrom or any direction
from the Lenders to the Agent, and, for purposes of determining the Required
Lenders at any time when any Lender is in default under this Agreement, the
Commitments and Advances of such defaulting Lenders shall be disregarded.
(d) In addition to the above, the Company may change the
Canadian Borrower (provided that it qualifies as a Canadian Borrower under the
provisions of the definitions of those terms) hereto at any time upon (i) the
execution and delivery by the Company, the existing Canadian Borrower, the new
Canadian Borrower and the Agent of a joinder and assumption agreement in form
satisfactory to the Agent providing for such Subsidiary to become the Canadian
Borrower, (ii) the execution and delivery by the Company of a Guaranty, or the
confirmation of the existing Guaranty, with respect to such new Canadian
Borrower, (iii) the delivery to the Agent of such legal opinions, resolutions
and corporate documents as requested by the Agent, (iv) the delivery of such
other documents with respect thereto as the Agent shall reasonably request and
(v) the written approval of the Agent.
8.2 Notices. (a) Except as otherwise provided in Section 8.2(c) hereof,
all notices and other communications hereunder shall be sent to the Borrowers at
2801 East Beltline NE, Grand Rapids, Michigan 49505, Attention: Chief Financial
Officer, Facsimile No. 616-364-3136, to the Agent and the Lenders at the
respective addresses and numbers for notices set forth on the signatures pages
hereof, or to such other address as may be designated by the Borrowers, the
Agent or any Lender by notice to the other parties hereto. All notices and other
communications shall be deemed to have been given at the time of actual delivery
thereof to such address, or if sent by certified or registered mail, postage
prepaid, to such address, on the third day after the date of mailing, or if
deposited prepaid with Federal Express or other nationally
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recognized overnight delivery service prior to the deadline for next day
delivery, on the Business Day next following such deposit, provided, however,
that notices to the Agent shall not be effective until received.
(b) Notices by any Borrower to the Agent with respect to
terminations or reductions of the Commitments pursuant to Section 2.4, requests
for Advances pursuant to Section 2.6, requests for continuations or conversions
of Loans pursuant to Section 2.9 and notices of prepayment pursuant to Section
3.1 shall be irrevocable and binding on such Borrower.
(c) Any notice to be given by the Borrowers to the Agent
pursuant to Sections 2.6 or 2.9 and any notice to be given by the Agent or any
Lender hereunder, may be given by telephone, and all such notices given by the
Borrowers must be immediately confirmed in writing in the manner provided in
Section 8.2(a). Any such notice given by telephone shall be deemed effective
upon receipt thereof by the party to whom such notice is to be given.
8.3 No Waiver By Conduct; Remedies Cumulative. No course of dealing on
the part of the Agent or any Lender, nor any delay or failure on the part of the
Agent or any Lender in exercising any right, power or privilege hereunder shall
operate as a waiver of such right, power or privilege or otherwise prejudice the
Agent's or such Lender's rights and remedies hereunder; nor shall any single or
partial exercise thereof preclude any further exercise thereof or the exercise
of any other right, power or privilege. No right or remedy conferred upon or
reserved to the Agent or any Lender under this Agreement or the Loan Documents
is intended to be exclusive of any other right or remedy, and every right and
remedy shall be cumulative, and in addition to every other right or remedy
granted thereunder or now or hereafter existing under any applicable law. Every
right and remedy granted by the Loan Documents or by applicable law to the Agent
or any Lender may be exercised from time to time and as often as may be deemed
expedient by the Agent or any Lender and, unless contrary to the express
provisions of the Loan Documents, irrespective of the occurrence or continuance
of any Default or Event of Default.
8.4 Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of the Borrowers or any
Guarantor made herein, in any Guaranty or in any certificate, report, financial
statement or other document furnished by or on behalf of the Borrowers or any
Guarantor in connection with this Agreement shall be deemed to be material and
to have been relied upon by the Lenders, notwithstanding any investigation
heretofore or hereafter made by any Lender or on such Lender's behalf, and those
covenants and agreements of the Borrowers set forth in Sections 3.7, 3.9 and 8.5
hereof shall survive the repayment in full of the Advances and the termination
of the Commitments for a period of one year from such repayment or termination.
8.5 Expenses. (a) The Borrowers agree to pay, or reimburse the Agent
for the payment of, on demand, (i) the reasonable fees and expenses of counsel
to the Agent, including without limitation the reasonable fees and expenses of
Dickinson Wright PLLC in connection with the preparation, execution, delivery
and administration of the Loan Documents and the consummation of the
transactions contemplated hereby, and in connection with advising the Agent as
to its rights and responsibilities with respect thereto, and in connection with
any amendments, waivers or consents in connection therewith, and (ii) all stamp
and other taxes and fees payable or determined to be payable in connection with
the execution, delivery, filing or recording of the Loan Documents and the
consummation of the transactions contemplated hereby, and any and all
liabilities with respect to or resulting from any delay in paying or omitting to
pay such taxes or fees, and (iii) all reasonable costs and expenses of the Agent
and any Lender (including without limitation reasonable fees and expenses of
counsel, including without limitation counsel who are employees of the Agent or
any Lender, and whether incurred through negotiations, legal proceedings or
otherwise) in
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connection with any Default or Event of Default or the enforcement of, or the
exercise or preservation of any rights under, the Loan Documents, and (iv) all
reasonable costs and expenses of the Agent and the Arranger, whether incurred
prior to or subsequent to the Effective Date, in investigation, preparation,
negotiation, documentation, syndication, administration and collection, for the
account of the Borrowers, including without limitation expenses of and fees for
advisors and professionals engaged by the Agent or the Arranger, and (v) all
reasonable costs and expenses of the Agent and the Lenders (including reasonable
fees and expenses of counsel) in connection with any action or proceeding
relating to a court order, injunction or other process or decree restraining or
seeking to restrain the Agent from paying any amount under, or otherwise
relating in any way to, any Letter of Credit and any and all costs and expenses
which any of them may incur relative to any payment under any Letter of Credit.
(b) The Company hereby indemnifies and agrees to hold
harmless the Lenders and the Agent, and their respective officers, directors,
employees, agents and advisors, harmless from and against any and all claims,
damages, losses, liabilities, costs or expenses of any kind or nature whatsoever
which the Lenders or the Agent or any such Person may incur or which may be
claimed against any of them by reason of or in connection with any Letter of
Credit, and neither any Lender nor the Agent or any of their respective
officers, directors, employees or agents shall be liable or responsible for: (i)
the use which may be made of any Letter of Credit or for any acts or omissions
of any beneficiary in connection therewith; (ii) the validity, sufficiency or
genuineness of documents or of any endorsement thereon, even if such documents
should in fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (iii) payment by the Agent to the beneficiary under any
Letter of Credit against presentation of documents which do not comply with the
terms of any Letter of Credit, including failure of any documents to bear any
reference or adequate reference to such Letter of Credit; (iv) any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit;
or (v) any other event or circumstance whatsoever arising in connection with any
Letter of Credit; provided, however, that the Company shall not be required to
indemnify the Lenders and the Agent and such other Persons, and the Agent shall
be liable to the Company to the extent, but only to the extent, of any direct,
as opposed to consequential or incidental, damages suffered by the Company which
were caused by (A) the Agent's wrongful dishonor of any Letter of Credit after
the presentation to it by the beneficiary thereunder of a draft or other demand
for payment and other documentation strictly complying with the terms and
conditions of such Letter of Credit, to the extent, but only to the extent, that
such dishonor constitutes gross negligence or willful misconduct of the Agent as
determined by a final non-appealable order of a court of competent jurisdiction,
or (B) the Agent's payment to the beneficiary under any Letter of Credit against
presentation of documents which do not comply with the terms of the Letter of
Credit, to the extent, but only to the extent, that such payment constitutes
gross negligence or willful misconduct of the Agent as determined by a final
non-appealable order of a court of competent jurisdiction. It is understood that
in making any payment under a Letter of Credit the Agent will rely on documents
presented to it under such Letter of Credit as to any and all matters set forth
therein without further investigation and regardless of any notice or
information to the contrary, and such reliance and payment against documents
presented under a Letter of Credit substantially complying with the terms
thereof shall not be deemed gross negligence or willful misconduct of the Agent
in connection with such payment.
(c) Each Borrower agrees to indemnify each Lender, the Agent
and each of their respective officers, directors, employees, agents and advisors
(collectively, the "Indemnified Parties") and hold each Indemnified Party
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind at any time, including, without limitation, the reasonable
fees and disbursements of counsel, which may be incurred by any Indemnified
Party in connection with any investigative, administrative or judicial
proceeding (whether or not such Indemnified Party shall be designated a party
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thereto) (collectively, the "Indemnified Liabilities") at any time relating to
(whether before or after the execution of this Agreement) any of the following:
(i) any actual or proposed use of the Advances hereunder
by the Borrower or any of its Subsidiaries or any transaction financed or to be
financed in whole or in part, directly or indirectly, with the proceeds of any
Advance;
(ii) the entering into and performance of this Agreement
and any other Loan Document by any of the Indemnified Parties (including any
action brought by or on behalf of the Borrower as the result of any
determination by any Lender not to make any Advance);
(iii) any investigation, litigation or proceeding
related to any Acquisition or proposed Acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person or to
the issuance of, or any other matter relating to, any Subordinated Debt, whether
or not any Indemnified Party is a party thereto;
(iv) any investigation, litigation or proceeding related
to any environmental cleanup, audit, compliance or other matter relating to any
release by such Borrower or any of its Subsidiaries of any hazardous material or
any violations of Environmental Laws; or
(v) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of any
hazardous material (including any losses, liabilities, damages, injuries, costs,
expenses or claims asserted or arising under any Environmental Law), regardless
of whether caused by, or within the control of, the Borrower or such Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the activities of the Indemnified
Party on the property of the Borrower conducted subsequent to a foreclosure on
such property by any Indemnified Party or by reason of the relevant Indemnified
Party's gross negligence or willful misconduct or breach of this Agreement, and
if and to the extent that the foregoing undertaking may be unenforceable for any
reason, the Borrower hereby agrees to make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law. The Borrower shall be obligated to indemnify
the Indemnified Parties for all Indemnified Liabilities subject to and pursuant
to the foregoing provisions, regardless of whether the Borrower or any of its
Subsidiaries had knowledge of the facts and circumstances giving rise to such
Indemnified Liability.
Provided that no Indemnified Party shall have the right to be
indemnified hereunder for its own gross negligence or willful misconduct as
determined by a final, non-appealable judgment of a court of competent
jurisdiction.
8.6 Successors and Assigns. (a) This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns, provided that the Borrowers may not, without the prior consent of
the Lenders, assign their respective rights or obligations hereunder or under
the Loan Documents and the Lenders shall not be obligated to make any Advance
hereunder to any entity other than the Borrowers.
(b) Any Lender may sell to any financial institution or
institutions, and such financial institution or institutions may further sell, a
participation interest (undivided or divided) in, the Loans and such Lender's
rights and/or obligations under the Loan Documents, and to the extent of that
participation interest such participant or participants shall have the same
rights and benefits against the Borrowers under
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Section 3.7, 3.9 and 6.2(c) as it or they would have had if such participant or
participants were the Lender making the Loans to the Borrowers hereunder,
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unmodified and fully effective and enforceable against such Lender, (ii)
such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender shall remain the holder of
its Notes and Advances for all purposes of this Agreement, (iv) the Borrowers,
the Agent and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement, (v) such Lender shall not grant to its participant (other than any
participant which is an Affiliate of such Lender) any rights to consent or
withhold consent to any action taken by such Lender or the Agent under this
Agreement other than action requiring the consent of all of the Lenders
hereunder, and (vi) no participant shall be entitled to receive any greater
amount pursuant to Sections 3.5, 3.7, 3.9 or 6.2(c) than the transferor Lender
would have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such participant had no
such transfer occurred.
(c) The Agent from time to time in its sole discretion may
appoint agents for the purpose of servicing and administering this Agreement and
the transactions contemplated hereby and enforcing or exercising any rights or
remedies of the Agent provided under the Loan Documents or otherwise. In
furtherance of such agency, the Agent may from time to time direct that the
Borrowers provide notices, reports and other documents contemplated by this
Agreement (or duplicates thereof) to such agent. Each Borrower hereby consents
to the appointment of such agent and agrees to provide all such notices, reports
and other documents and to otherwise deal with such agent acting on behalf of
the Agent in the same manner as would be required if dealing with the Agent
itself.
(d) Each Lender may, with the prior consent of the Borrowers
(which consent may not be unreasonably withheld or delayed and shall not be
required upon the occurrence and during the continuance of any Event of Default
or if such assignment is to another Lender or an Affiliate of a Lender) and the
Agent, assign to one or more banks or other entities all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Commitment, the Advances owing to it and the Note or Notes
held by it); provided, however, that (i) each such assignment shall be of a
uniform, and not a varying, percentage of all rights and obligations, (ii)
except in the case of an assignment of all of a Lender's rights and obligations
under this Agreement, (A) the amount of the Commitment of the assigning Lender
being assigned pursuant to each such assignment (determined as of the date of
the Assignment and Acceptance with respect to such assignment) shall in no event
be less than $5,000,000, and in integral multiples of $1,000,000 thereafter, or
such lesser amount as to which the Borrowers and the Agent may consent, and (B)
after giving effect to each such assignment (unless the assignment is for the
entire amount of such Lender's Commitment), the amount of the Commitment of the
assigning Lender shall in no event be less than $5,000,000 or such lesser amount
as to which the Borrowers and the Agent may consent, (iii) the parties to each
such assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance in the form of Exhibit M
hereto (an "Assignment and Acceptance"), together with any Note or Notes subject
to such assignment and a processing and recordation fee of $3,500, and (iv) any
Lender may without the consent of the Borrowers or the Agent, and without paying
any fee, assign or sell a participation interest to any Affiliate of such Lender
that is a bank or financial institution all or a portion of its rights and
obligations under this Agreement. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in such Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder and (y) the Lender assignor thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations
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under this Agreement (and, in the case of an Assignment and Acceptance covering
all of the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto).
(e) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrowers or the performance or observance by the Borrowers of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.6 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
this Agreement as are delegated to the Agent by the terms hereof, together with
such powers and discretion as are reasonably incidental thereto; and (vi) such
assignee agrees that it will perform and assume in accordance with their terms
all of the obligations that by the terms of this Agreement and the other Loan
Documents are required to be performed or assumed by it as a Lender.
(f) The Agent shall maintain at its address designated on the
signature pages hereof a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Lenders and the Commitment of, and principal amount of the Loans owing to,
each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and the
Borrowers, the Agent and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrowers or
any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(g) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee, together with any Note or Notes subject
to such assignment, the Agent shall, if such Assignment and Acceptance has been
completed, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Borrowers. Within five Business Days after its receipt of such
notice, the Borrowers, at their own expense, shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note to the order of
such assignee in an amount equal to the Commitment assumed by it pursuant to
such Assignment and Acceptance and, if the assigning Lender has retained a
Commitment hereunder, a new Note to the order of the assigning Lender in an
amount equal to the Commitment retained by it hereunder. Such new Note or Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note or Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of Exhibit M hereto.
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(h) The Borrowers shall not be liable for any costs or
expenses of any Lender in effectuating any participation or assignment under
this Section 8.6.
(i) The Lenders may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.6, disclose to the assignee or participant or proposed assignee or participant
(each a "Transferee") any information relating to any Borrower or its
Subsidiaries; provided that each Transferee agrees to be bound by the terms of
Section 8.16.
(j) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in, or assign,
all or any portion of its rights under this Agreement (including, without
limitation, the Loans owing to it and the Note or Notes held by it) in favor of
any Federal Reserve Lender in accordance with Regulation A of the Board of
Governors of the Federal Reserve System; provided that such creation of a
security interest or assignment shall not release such Lender from its
obligations under this Agreement.
8.7 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
8.8 Governing Law. This Agreement is a contract made under, and shall
be governed by and construed in accordance with, the law of the State of
Michigan applicable to contracts made and to be performed entirely within such
State and without giving effect to choice of law principles of such State.
8.9 Table of Contents and Headings. The table of contents and the
headings of the various subdivisions hereof are for the convenience of reference
only and shall in no way modify any of the terms or provisions hereof.
8.10 Construction of Certain Provisions. If any provision of this
Agreement refers to any action to be taken by any Person, or which such Person
is prohibited from taking, such provision shall be applicable whether such
action is taken directly or indirectly by such Person, whether or not expressly
specified in such provision.
8.11 Integration and Severability. The Loan Documents embody the entire
agreement and understanding among the Borrowers and the Agent and the Lenders,
and supersede all prior agreements and understandings, relating to the subject
matter hereof. In case any one or more of the obligations of the Borrowers under
the Loan Documents shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
obligations of the Borrowers shall not in any way be affected or impaired
thereby, and such invalidity, illegality or unenforceability in one jurisdiction
shall not affect the validity, legality or enforceability of the obligations of
the Borrowers under the Loan Documents in any other jurisdiction.
8.12 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any such covenant, the fact that it would be permitted by an exception to, or
would be otherwise within the limitations of, another covenant shall not avoid
the occurrence of a Default or an Event of Default if such action is taken or
such condition exists.
8.13 Interest Rate Limitation. Notwithstanding any provisions of this
Agreement or the Notes, in no event shall the amount of interest paid or agreed
to be paid by the Borrowers exceed an amount
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computed at the highest rate of interest permissible under applicable law. If,
from any circumstances whatsoever, fulfillment of any provision of this
Agreement or the Notes at the time performance of such provision shall be due,
shall involve exceeding the interest rate limitation validly prescribed by law
which a court of competent jurisdiction may deem applicable hereto, then, ipso
facto, the obligations to be fulfilled shall be reduced to an amount computed at
the highest rate of interest permissible under applicable law, and if for any
reason whatsoever any Lender shall ever receive as interest an amount which
would be deemed unlawful under such applicable law such interest shall be
automatically applied to the payment of principal of such Lender's Advances
outstanding hereunder (whether or not then due and payable) and not to the
payment of interest, or shall be refunded to the Borrowers if such principal and
all other obligations of the Borrowers to such Lender have been paid in full.
8.14 Acknowledgments. Each Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) none of the Agent or any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Agent and the Lenders, on the one hand, and the Borrower, on the other hand,
in connection herewith or therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Lenders or among the Borrower and the Lenders.
8.15 Submission To Jurisdiction; Waivers. Each Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action
or proceeding relating to this Agreement and the other Loan Documents to which
it is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of any United States federal
or Michigan state court sitting in Detroit, Michigan and appellate courts from
any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
Borrower at the address specified in Section 8.2, or at such other address of
which the Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding referred
to in this subsection any special, exemplary, punitive or consequential damages.
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8.16 Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrowers pursuant to this Agreement
in confidence, except for disclosure (i) to its Affiliates and to other Lenders
and their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or Affiliate or to a Transferee, (iii) to
regulatory officials, (iv) to any Person as requested pursuant to or as required
by law, regulation, or legal process, (v) to any Person in connection with any
legal proceeding to which such Lender is a party, (vi) to such Lenders' direct
or indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii)
permitted by Section 8.6(i).
8.17 WAIVER OF JURY TRIAL. THE LENDERS AND THE AGENT AND THE
BORROWERS, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM
MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF ANY
LOAN DOCUMENT OR ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF EITHER OF THEM. NEITHER ANY LENDER, THE
AGENT NOR THE BORROWERS SHALL SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE,
ANY SUCH ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN
WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL NOT
BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY ANY PARTY
HERETO EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY SUCH PARTY.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
UNIVERSAL FOREST PRODUCTS, INC.
By:
-----------------------------------------
Print Name:
---------------------------------
Its:
----------------------------------------
UNIVERSAL FOREST PRODUCTS NOVA SCOTIA
ULC
By:
-----------------------------------------
Print Name:
--------------------------------
Its:
----------------------------------------
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Address for Notices: BANK ONE, NA, as a Lender and as Agent
611 Woodward Avenue By:
Detroit, Michigan 48226 ------------------------------------
Attention: Thomas Gamm
e-mail address: Print Name:
thomas_gamm@bankone.com ----------------------------
Facsimile No.: 313-226-0855
Telephone No.: 313-225-2531 Its:
-----------------------------------
U.S. Commitment: $25,000,000
Canadian Commitment: $5,000,000
APPLICABLE LENDING OFFICE IN CANADA:
Address for Notices: BANK ONE, NA, CANADA BRANCH
161 Bay Street
Suite 4240 By:
Toronto Ontario M5J 2S1 ------------------------------------
Attention:
-------------------- Print Name:
Telephone: (416) 365-8262 -----------------------------
Telecopy: (416) 363-7574
Its:
------------------------------------
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Address for Notices: WACHOVIA BANK, NA, as a Lender and as
Syndication Agent
191 Peachtree Street, NE By:
Atlanta, GA 30303 ---------------------------------
Attention: Shawn Janko
Print Name:
-------------------------
Facsimile No.: 404-332-4136 Its:
Telephone No.: 404-332-5884 ---------------------------------
e-mail address: shawn.janko@wachovia.com
U.S. Commitment: $22,500,000
Canadian Commitment: $0
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Address for Notices: STANDARD FEDERAL BANK, NA, as a
Lender and as Documentation Agent
125 Ottawa Ave. N.W., Suite 270 By:
Grand Rapids, MI 49503 ---------------------------------
Attention: Brian Janssen
Print Name:
-------------------------
Facsimile No.: 616-776-7770 Its:
Telephone No.: 616-776-3826 --------------------------------
e-mail address: brian.janssen@abnamro.com
U.S. Commitment: $20,000,000
Canadian Commitment: $0
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Address for Notices: BANK OF MONTREAL
115 South LaSalle, 17W
Chicago, IL 60603
By:
-----------------------------------
Attention: Betty Rutherford Print Name:
---------------------------
Facsimile No.: 312-765-8105 Its:
Telephone No.: 312-461-7223 ----------------------------------
e-mail address:
U.S. Commitment: $18,500,000
Canadian Commitment: $5,000,000
APPLICABLE LENDING OFFICE IN CANADA:
Address for Notices: BANK OF MONTREAL
100 King Street West
Toronto, Ontario M5X 1A1 By:
-----------------------------------
Attention: Francois Archambault Print Name:
---------------------------
Facsimile No.: 312-750-1790 Its:
Telephone No.: 312-750-4334 ----------------------------------
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Address for Notices: COMERICA BANK
500 Woodward Avenue, 9th Floor By:
Detroit, MI 48226 ---------------------------------
Attention: Jeffrey J. Judge
Print Name:
-------------------------
Facsimile No.: 313-222-9514
Its:
Telephone No.: 313-222-3801 --------------------------------
e-mail address: jjjudge@comerica.com
U.S. Commitment: $18,500,000
Canadian Commitment: $5,000,000
APPLICABLE LENDING OFFICE IN CANADA:
Address for Notices: COMERICA BANK, CANADA BRANCH
200 Bay Street, Ste. 2210, S. Tower
Toronto, Ontario M5J 2J2 By:
---------------------------------
Attention: Robert Rosen Print Name:
-------------------------
Facsimile No.: 416-367-2460 Its:
Telephone No.:416-367-3113 --------------------------------
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Address for Notices: KEYBANK NATIONAL ASSOCIATION
127 Public Square By:
Cleveland, OH 44114 --------------------------------
Attention: Mary K. Young
Print Name:
Facsimile No.: 216-689-4981 ------------------------
Telephone No.: 216-689-4443
e-mail address: mary_k_young@keybank.com Its:
-------------------------------
U.S. Commitment: $18,500,000
Canadian Commitment: $0
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Address for Notices: NATIONAL CITY BANK
1001 South Worth By:
Birmingham, MI 48009-6943 --------------------------------
Attention: Michael Hinz
e-mail address: Print Name:
michael.hinz@nationalcity.com ------------------------
Facsimile No.: 248-901-2033
Telephone No.: 248-901-2139 Its:
-------------------------------
U.S. Commitment: $17,000,000
Canadian Commitment: $0
-75-
Address for Notices: BANK OF AMERICA
555 California Street, 12th Floor By:
San Francisco, CA 94104-1503 ---------------------------------
Attention: Kevin F. Sullivan
Print Name:
Facsimile No.: 415-622-4585 -------------------------
Telephone No.: 415-622-4567
e-mail address: Its:
kevin.f.sullivan@bankofamerica.com --------------------------------
U.S. Commitment: $15,000,000
Canadian Commitment: $0
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Address for Notices: FIFTH THIRD BANK
111 Lyon Street, N.W. By:
Grand Rapids, MI 49503 --------------------------------
Attention: Robert Jamula
Print Name:
------------------------
Facsimile No.: 616-771-4641
Telephone No.: 616-771-5516 Its:
e-mail address: robert.jamula@53.com -------------------------------
U.S. Commitment: $15,000,000
Canadian Commitment: $0
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Address for Notices: HUNTINGTON NATIONAL BANK
50 Monroe Avenue NW By:
Grand Rapids, MI 49506 --------------------------------
Attention: Steven Gerow
Print Name:
------------------------
Facsimile No.: 616-771-6285
Telephone No.: 616-235-8138 Its:
e-mail address: -------------------------------
steven.gerow@huntington.com
U.S. Commitment: $15,000,000
Canadian Commitment: $0
-78-
Address for Notices: PROVIDENT BANK
618 Kenmoor SE, Ste. 110 By:
Grand Rapids, MI 49546 --------------------------------
Attention: Donald Van Dine
Print Name:
------------------------
Facsimile No.: 616-575-5810
Telephone No.: 616-575-5700 Its:
e-mail address: -------------------------------
donald.vandine@providentbank.com
U.S. Commitment: $15,000,000
Canadian Commitment: $0
-79-
EXHIBIT A
BID-OPTION NOTE
November 25, 2002
Detroit, Michigan
For value received, Universal Forest Products, Inc., a Michigan
corporation (the "Company"), unconditionally promises to pay to the order of
__________________________________ (the "Lender"), the unpaid principal amount
of each Bid-Option Loan made by the Lender to the Company pursuant to the Credit
Agreement referred to below, on the last day of the Interest Period relating to
such Loan. The Company further promises to pay interest on the aggregate unpaid
principal amount of such Bid-Option Loans on the dates and at the rates
negotiated as provided in the Credit Agreement. All such payments of principal
and interest with respect to Bid-Option Loans shall be made in U.S. Dollars in
Same Day Funds at the Agent's principal office in Detroit, Michigan.
The Lender is hereby authorized by the Company to record on
the schedule attached to this Bid-Option Note, or on its books and records, the
date, amount and type of each Bid-Option Loan, the duration of the related
Interest Period (if applicable), the amount of each payment or prepayment of
principal thereon and the other information provided for on such schedule, which
schedule or such books and records, as the case may be, shall constitute prima
facie evidence of the information so recorded, provided, however, that any
failure by the Lender to record any such information shall not relieve the
Company of its obligation to repay the outstanding principal amount of such
Bid-Option Loans, all accrued interest thereon and any amount payable with
respect thereto in accordance with the terms of this Bid-Option Note and the
Credit Agreement.
The Company and each endorser or guarantor hereof waives
demand, presentment, protest, diligence, notice of dishonor and any other
formality in connection with this Bid-Option Note. Should the indebtedness
evidenced by this Bid-Option Note or any part thereof be collected in any
proceeding or be placed in the hands of attorneys for collection, the Company
agrees to pay, in addition to the principal, interest and other sums due and
payable hereon, all costs of collecting this Bid-Option Note, including
attorneys' fees and expenses (including without limitation allocated costs and
expenses of attorneys who are employees of the Lender).
This Bid-Option Note evidences one or more Bid-Option Loans made under
the Credit Agreement, dated as November , 2002, as amended, supplemented or
otherwise modified from time to time (the "Credit Agreement"), by and among the
Company, the Canadian Borrower, the lenders party thereto from time to time
(including the Lender), Bank One, NA, as Agent, Wachovia Bank, N.A., as
Syndication Agent, and Standard Federal Bank, N.A., as Documentation Agent, to
which reference is hereby made for a statement of the circumstances under which
this Bid-Option Note is subject to prepayment and under which its due date may
be accelerated. Capitalized terms used but not defined in this Bid-Option Note
shall have the respective meanings ascribed thereto in the Credit Agreement.
This Bid-Option Note is made under, and shall be governed by and
construed in accordance with, the laws of the State of Michigan applicable to
contracts made and to be performed entirely within such State and without giving
effect to choice of law principles of such State.
UNIVERSAL FOREST PRODUCTS, INC.
By:
--------------------------------------
Print Name:
------------------------------
Its:
-------------------------------------
BID-OPTION NOTE
-2-
Schedule to Bid-Option Note, dated November ________, 2002,
payable by Universal Forest Products, Inc. to the order of ________________
<Table>
<Caption>
Principal
Trans- Amount of Type of Amount Principal Notation
action Bid-Option Bid-Option Interest Interest Paid Or Balance Made
Date Loan Loan* Rate Period Prepaid Outstanding By
- ------ ---------- ---------- --------- --------- ----------- ----------- --------
</Table>
* A - Bid-Option Absolute Rate
E - Bid-Option Eurocurrency Rate
BID-OPTION NOTE
-3-
EXHIBIT B
GUARANTY AGREEMENT
PARTIES
THIS GUARANTY AGREEMENT, dated as of November 25, 2002 (this
"Guaranty"), is made by UNIVERSAL FOREST PRODUCTS, INC., a Michigan corporation
(the "Company"), UNIVERSAL FOREST PRODUCTS INDIANA LIMITED PARTNERSHIP, a
Michigan limited partnership ("Universal Indiana"), UNIVERSAL FOREST PRODUCTS
TEXAS LIMITED PARTNERSHIP, a Michigan limited partnership ("Universal Texas"),
UNIVERSAL FOREST PRODUCTS HOLDING COMPANY, INC., a Michigan corporation
("Universal Holding"), UNIVERSAL FOREST PRODUCTS WESTERN DIVISION, INC., a
Michigan corporation ("Universal Western"), SHOFFNER HOLDING COMPANY, INC., a
Michigan corporation ("Shoffner Holding"), UNIVERSAL FOREST PRODUCTS EASTERN
DIVISION, INC., a Michigan corporation ("Universal Eastern"), UNIVERSAL FOREST
PRODUCTS SHOFFNER LLC, a Michigan limited liability company ("Shoffner LLC"),
UNIVERSAL TRUSS, INC., a Michigan corporation ("Universal Truss"), UNIVERSAL
FOREST PRODUCTS RECLAMATION CENTER, INC., a Michigan corporation ("Universal
Reclamation"), UNIVERSAL FOREST PRODUCTS OF MODESTO L.L.C., a Michigan limited
liability company ("Universal Modesto"), TRESSTAR, LLC, a Michigan limited
liability company ("Tresstar"), UFP VENTURES, INC., a Michigan corporation ("UFP
Ventures"), CONSOLIDATED BUILDING COMPONENTS, INC., a Pennsylvania corporation
("Consolidated Building"), UFP REAL ESTATE, INC., a Michigan corporation ("UFP
Real Estate"), SYRACUSE REAL ESTATE, LLC, a Michigan limited liability company
("Syracuse Real Estate"), and UFP VENTURES II, INC., a Michigan corporation
("UFP Ventures II", and together with the Company, Universal Indiana, Universal
Texas, Universal Holding, Universal Western, Shoffner Holding, Universal
Eastern, Shoffner LLC, Universal Truss, Universal Reclamation, Universal
Modesto, Tresstar, UFP Ventures, Consolidated Building, UFP Real Estate, and
Syracuse Real Estate, collectively referred to as the "Guarantors") in favor of
each of the Lenders as defined below.
RECITALS
A. The Company and the Canadian Borrower (collectively referred to as
the "Borrowers", and individually as a "Borrower"), the lenders party thereto
from time to time (such lenders, together with any other lenders now or
hereafter parties to the Credit Agreement as defined below, collectively
referred to as the "Banks"), Bank One, NA, as agent for the Banks (in such
capacity, together with any successor agent, the "Agent"), Wachovia Bank, N.A.,
as Syndication Agent, and Standard Federal Bank, N.A., as Documentation Agent,
have executed a Credit Agreement dated as November 25, 2002 (as amended or
modified from time to time, and together with any agreement executed in
replacement therefor or otherwise refinancing such credit agreement, the "Credit
Agreement"), and the Borrowers have issued their promissory notes pursuant to
the Credit Agreement (as amended or modified from time to time and together with
any promissory note or notes issued in exchange or replacement therefor or
otherwise issued pursuant to the Credit Agreement, the "Notes", and the Credit
Agreement, the Notes and all other agreements and instruments among the
Borrowers, the Agent and the Banks, or any of them, executed in connection
therewith, including without limitation any Rate Hedging Agreements relating to
the Credit Agreement, whether now or hereafter executed, and any supplements or
modifications thereof and any agreements or instruments issued in exchange or
replacement therefor, collectively referred to as the "Agreements").
B. Pursuant to the terms of the Agreements the Banks have agreed to
make certain extensions of credit to the Borrowers.
C. Each Guarantor, other than the Company, is a Domestic Subsidiary of
the Company or the Canadian Borrower, the Canadian Borrower, the Company, and
the other Guarantors are engaged in related businesses, and the Guarantors have
derived or will derive substantial direct and indirect benefit from the making
of the extensions of credit by the Banks.
D. The obligation of the Banks to make or continue to make certain
extensions of credit under the Credit Agreement are conditioned upon, among
other things, the execution and delivery by the Guarantors of this Guaranty, and
the extensions of credit under the Credit Agreement were made in reliance upon
the issuance of this Guaranty.
AGREEMENT
In consideration of the premises and to induce the Banks to make loans,
extend credit or make other financial accommodations, and to continue to keep
such credit and other financial accommodations available to the Borrowers, each
Guarantor hereby agrees with and for the benefit of the Banks as follows:
1. Defined Terms. As used in this Guaranty, terms defined in the first
paragraph of this Guaranty and in the recital paragraphs are used herein as
defined therein, and the following terms shall have the following meanings:
"Cumulative Guarantors" shall mean the Guarantors and all
other future guarantors of the Liabilities.
"Lenders" shall mean the Banks and the Agent and their
successors and assigns.
"Liabilities" shall mean (i) with respect to the Guarantors
other than the Company, all indebtedness, obligations and liabilities of the
Borrowers to any of the Lenders in connection with or pursuant to the
Agreements, including without limitation, all principal, interest (including but
without limitation interest which, but for the filling of a bankruptcy petition,
would have accrued on the principal amount of the Liabilities), charges, fees
and all costs and expenses, including without limitation reasonable fees and
expenses of counsel, in each case whether now existing or hereafter arising,
direct or indirect (including without limitation any participation interest
acquired by any Lender in such indebtedness, obligations and liabilities of the
Borrowers to any other person), absolute or contingent, joint and/or several,
secured or unsecured, arising by operation of law or otherwise, and (ii) with
respect to the Company, all indebtedness, obligations and liabilities of the
Canadian Borrower to any of the Lenders in connection with or pursuant to the
Agreements, including without limitation, all principal, interest (including but
without limitation interest which, but for the filling of a bankruptcy petition,
would have accrued on the principal amount of the Liabilities), charges, fees
and all costs and expenses, including without limitation reasonable fees and
expenses of counsel, in each case whether now existing or hereafter arising,
direct or indirect (including
GUARANTY AGREEMENT
-2-
without limitation any participation interest acquired by any Lender in such
indebtedness, obligations and liabilities of the Canadian Borrower to any other
person), absolute or contingent, joint and/or several, secured or unsecured,
arising by operation of law or otherwise.
All other capitalized terms used but not defined herein shall have the
meanings ascribed thereto in the Credit Agreement.
2. Guarantee. (a) Each Guarantor hereby guarantees to the Lenders,
irrevocably, absolutely and unconditionally, as primary obligor and not as
surety only, the prompt and complete payment of the Liabilities.
(b) All payments to be made under this Guaranty (except
pursuant to paragraph (c) below) shall be made to each Lender pro rata in
accordance with the unpaid amount of Liabilities held by each Lender at the time
of such payment.
(c) The Guarantors agree to make prompt payment, on demand, of
any and all reasonable costs and expenses incurred by any Lender in connection
with enforcing the obligations of any of the Guarantors hereunder including
without limitation the reasonable fees and disbursements of counsel.
3. Consents to Renewals, Modifications and other Actions and Events.
This Guaranty and all of the obligations of the Guarantors hereunder shall
remain in full force and effect without regard to and shall not be released,
affected or impaired by: (a) any amendment, assignment, transfer, modification
of or addition or supplement to the Liabilities or any Agreement; (b) any
extension, indulgence, increase in the Liabilities or other action or inaction
in respect of any of the Agreements or otherwise with respect to the
Liabilities, or any acceptance of security for, or other guaranties of, any of
the Liabilities or Agreements, or any surrender, release, exchange, impairment
or alteration of any such security or guaranties including without limitation
the failing to perfect a security interest in any such security or abstaining
from taking advantage of or realizing upon any other guaranties or upon any
security interest in any such security; (c) any default by any Borrower under,
or any lack of due execution, invalidity or unenforceability of, or any
irregularity or other defect in, any of the Agreements; (d) any waiver by any
Lender or any other person of any required performance or otherwise of any
condition precedent or waiver of any requirement imposed by any of the
Agreements, any other guaranties or otherwise with respect to the Liabilities;
(e) any exercise or non-exercise of any right, remedy, power or privilege in
respect of this Guaranty, any other guaranty or any of the Agreements; (f) any
sale, lease, transfer or other disposition of the assets of any Borrower or any
consolidation or merger of any Borrower with or into any other person,
corporation, or entity, or any transfer or other disposition of any shares of
capital stock of any Borrower; (g) any bankruptcy, insolvency, reorganization or
similar proceedings involving or affecting any Borrower or any other guarantor
of the Liabilities; (h) the release or discharge of any Borrower from the
performance or observance of any agreement, covenant, term or condition under
any of the Liabilities or contained in any of the Agreements, of any Cumulative
Guarantor or of this Guaranty, by operation of law or otherwise; or (i) any
other cause whether similar or dissimilar to the foregoing which, in the absence
of this provision, would release, affect or impair the obligations, covenants,
agreements or duties of any Guarantor hereunder or constitute a defense hereto,
including without limitation any act or omission by any Lender or any other
person which increases the scope of any Guarantor's risk; and in each case
described in this paragraph whether or not any Guarantor shall have notice or
knowledge of any of the foregoing, each
GUARANTY AGREEMENT
-3-
of which is specifically waived by each Guarantor. Each Guarantor warrants to
the Lenders that it has adequate means to obtain from the Borrowers on a
continuing basis information concerning the financial condition and other
matters with respect to the Borrowers and that it is not relying on any Lender
to provide such information either now or in the future.
4. Waivers, Etc. Each Guarantor unconditionally waives: (a) notice of
any of the matters referred to in Paragraph 3 above; (b) all notices which may
be required by statute, rule of law or otherwise to preserve any rights of any
Lender, including, without limitation, notice to the Guarantors of default,
presentment to and demand of payment or performance from any Borrower and
protest for non-payment or dishonor; (c) any right to the exercise by any Lender
of any right, remedy, power or privilege in connection with any of the
Agreements; (d) any requirement of diligence or marshaling on the part of any
Lender; (e) any requirement that any Lender, in the event of any default by any
Borrower, first make demand upon or seek to enforce remedies against, such
Borrower or any other Cumulative Guarantor before demanding payment under or
seeking to enforce this Guaranty; (f) any right to notice of the disposition of
any security which any Lender may hold from any Borrower or otherwise and any
right to object to the commercial reasonableness of the disposition of any such
security; and (g) all errors and omissions in connection with any Lender's
administration of any of the Liabilities, any of the Agreements or any other
Cumulative Guarantor, or any other act or omission of any Lender which changes
the scope of such Guarantor's risk. The obligations of each Guarantor hereunder
shall be complete and binding forthwith upon the execution of this Guaranty by
it and subject to no condition whatsoever, precedent or otherwise, and notice of
acceptance hereof or action in reliance hereon shall not be required.
5. Nature of Guaranty; Payments. This Guaranty is an absolute,
unconditional, irrevocable and continuing guaranty of payment and not a guaranty
of collection, and is wholly independent of and in addition to other rights and
remedies of any Lender with respect to any Borrower, any collateral, any
Cumulative Guarantor or otherwise, and it is not contingent upon the pursuit by
any Lender of any such rights and remedies, such pursuit being hereby waived by
each Guarantor. The obligations of each Guarantor hereunder shall be continuing
and shall continue (irrespective of any statute of limitations otherwise
applicable) and cover and include all the Liabilities of the Borrowers accruing
or in the process of accruing to the Lenders before the Lenders deliver to the
Guarantors a release of this Guaranty, which is in writing, refers specifically
to this Guaranty, and is signed by a President, a Senior Vice President, or a
Vice President of each Lender. Nothing shall discharge or satisfy the liability
of any Guarantor hereunder except the full and irrevocable payment and
performance of all of the Liabilities and the expiration or termination of all
the Agreements. All payments to be made by the Guarantors hereunder shall be
made without set-offs or counterclaim, and each Guarantor hereby waives the
assertion of any such set-offs or counterclaims in any proceeding to enforce its
obligations hereunder. All payments to be made by each Guarantor hereunder shall
also be made without deduction or withholding for, or on account of, any present
or future taxes or other similar charges of whatsoever nature, provided that if
any Guarantor is nevertheless required by law to make any deduction or
withholding, such Guarantor shall pay to the Lenders such additional amounts as
may be necessary to ensure that the Lenders shall receive a net sum equal to the
sum which it would have received had no such deduction or withholding been made.
Each Guarantor agrees that, if at any time all or any part of any payment
previously applied by any Lender to any of the Liabilities must be returned by
such Lender for any reason, whether by court order, administrative order, or
settlement and whether as a "voidable preference", "fraudulent conveyance" or
otherwise, each Guarantor remains liable for the full amount returned as if such
amount had
GUARANTY AGREEMENT
-4-
never been received by such Lender, notwithstanding any termination of this
Guaranty or any cancellation of any of the Agreements and the Liabilities and
all obligations of each Guarantor hereunder shall be reinstated in such case.
6. Evidence of Liabilities. Each Lender's books and records showing the
Liabilities shall be admissible in any action or proceeding, shall be binding
upon each Guarantor for the purpose of establishing the Liabilities due from the
Borrowers and shall constitute prima facie proof, absent manifest error, of the
Liabilities of the Borrowers to such Lender, as well as the obligations of each
Guarantor to such Lender.
7. Subordination, Subrogation, Contribution, Etc. Each Guarantor agrees
that all present and future indebtedness, obligations and liabilities of any
Borrower to such Guarantor shall be fully subordinate and junior in right and
priority of payment to any indebtedness of such Borrower to the Lenders, and no
Guarantor shall have any right of subrogation, contribution (including but
without limitation the contribution and subrogation rights granted below),
reimbursement or indemnity whatsoever nor any right of recourse to security for
the debts and obligations of such Borrower unless and until all Liabilities
shall have been paid in full, such payment is not subject to any possibility of
revocation or rescission and all Agreements have expired or been terminated.
Subject to the preceding sentence, if any Guarantor makes a payment in respect
of the Liabilities it shall be subrogated to the rights of the payee against the
relevant Borrower with respect to such payment and shall have the rights of
contribution set forth below against all other Cumulative Guarantors and each
Guarantor agrees that all other Cumulative Guarantors shall have the rights of
contribution against it set forth below. If any Guarantor makes a payment in
respect of the Liabilities that is smaller in proportion to its Payment Share
(as hereinafter defined) than such payments made by the other Cumulative
Guarantors are in proportion to the amounts of their respective Payment Shares,
such Guarantor shall, when permitted by the first sentence of this Section 7,
pay to the other Guarantors an amount such that the net payments made by the
Cumulative Guarantors in respect of the Liabilities shall be shared among the
Cumulative Guarantors pro rata in proportion to their respective Payment Shares.
If any Guarantor receives any payment by way of subrogation that is greater in
proportion to the amount of its Payment Share than the payments received by the
other Cumulative Guarantors are in proportion to the amounts of their respective
Payment Shares, such Guarantor shall, when permitted by the first sentence of
this Section 7, pay to the other Cumulative Guarantors an amount such that the
subrogation payments received by the Guarantors shall be shared among the
Cumulative Guarantors pro rata in proportion to their respective Payment Shares.
For purposes of this Guaranty, the "Payment Share" of any Cumulative
Guarantor shall be the sum of (a) the aggregate proceeds of the Liabilities
received by such Guarantor (and, if received subject to a repayment obligation,
remaining unpaid on the Determination Date, as hereinafter defined), plus (b)
the product of (i) the aggregate Liabilities remaining unpaid on the date such
Liabilities become due and payable in full, whether by stated maturity,
acceleration or otherwise (the "Determination Date") reduced by the amount of
such Liabilities attributed to all of the Cumulative Guarantors pursuant to
clause (a) above, times (ii) a fraction, the numerator of which is such
Guarantor's net worth on the effective date of this Guaranty (determined as of
the end of the immediately preceding fiscal reporting period of the Guarantor),
and the denominator of which is the aggregate net worth of all of the Cumulative
Guarantors, determined for each Cumulative Guarantor on the respective effective
date of the guaranty signed by such Cumulative Guarantor.
GUARANTY AGREEMENT
-5-
8. Assignment by Lenders. Each Lender shall have the right to assign
and transfer this Guaranty to any assignee of any portion of the Liabilities.
Each Lender's successors and assigns hereunder shall have the right to rely upon
and enforce this Guaranty.
9. Joint and Several Obligations. The obligations of the Guarantors
hereunder and all other Cumulative Guarantors shall be joint and several and
each Guarantor shall be liable for all of the Liabilities to the extent provided
herein regardless of any other Cumulative Guarantors, and each Lender shall have
the right, in its sole discretion to pursue its remedies against any Guarantor
without the need to pursue its remedies against any other Cumulative Guarantor,
whether now or hereafter in existence, or against any one or more Cumulative
Guarantors separately or against any two or more jointly, or against some
separately and some jointly.
10. Representations and Warranties. Each Guarantor hereby represents
and warrants to the Lenders that:
(a) the execution, delivery and performance by the Guarantor
of this Guaranty are within its corporate, company, or partnership powers, have
been duly authorized by all necessary corporate, company, or partnership action,
require no action by or in respect of, or filing with, any governmental body,
agency or official, and do not contravene or constitute a default under, any
provision of applicable law or regulation or of the articles of incorporation,
articles of organization, certificate of limited partnership or other charter
documents or bylaws, operating agreement or partnership agreement of such
Guarantor, or of any agreement, judgment, injunction, order, decree or other
instrument binding upon such Guarantor, or result in the creation or imposition
of any lien, security interest or other charge or encumbrance on any asset of
such Guarantor;
(b) this Guaranty constitutes a legal, valid and binding
agreement of each Guarantor, enforceable against the Guarantor in accordance
with its terms;
(c) as of the date hereof, each of the following is true and
correct for each Guarantor, assuming value is given to the rights of
contribution and subrogation as described in Section 7 hereof: (i) the fair
saleable value and the fair valuation of such Guarantor's property is greater
than the total amount of its liabilities (including contingent liabilities) and
greater than the amount that would be required to pay its probable aggregate
liability on its existing debts as they become absolute and matured, (ii) each
Guarantor's capital is not unreasonably small in relation to its current and/or
contemplated business or other undertaken transactions, and (iii) each Guarantor
does not intend to incur, or believe that it will incur, debt beyond its ability
to pay such debts as they become due; and
(d) the Canadian Borrower, the Company, and the other
Guarantors are engaged as an integrated group in the business of providing
related services; that the integrated operation requires financing on such a
basis that credit supplied to the Borrowers can be made available from time to
time to various subsidiaries of the Borrowers, as required for the continued
successful operation of the integrated group as a whole; and that each Guarantor
has requested the Lenders to continue to lend and to make credit available to
the Borrowers for the purpose of financing the integrated operations of the
Borrowers and their subsidiaries, including each Guarantor other than the
Company, with each Guarantor expecting to derive benefit, direct or
GUARANTY AGREEMENT
-6-
indirectly, from the loans and other credit extended by the Lenders to the
Borrowers, both in such Guarantor's separate capacity and as a member of the
integrated group, inasmuch as the successful operation and condition of each
Guarantor is dependent upon the continued successful performance of the
functions of the integrated group as a whole. Each of the Guarantors hereby
determines and agrees that the execution, delivery and performance of this
Guaranty are necessary and convenient to the conduct, promotion or attainment of
the business of such Guarantor and in furtherance of the corporate purposes of
such Guarantor.
11. Binding on Successors and Assigns. This Guaranty shall be the
valid, binding and enforceable obligation of the Guarantors and their successors
and assigns.
12. Indemnity. As a separate, additional and continuing obligation,
each Guarantor unconditionally and irrevocably undertakes and agrees with each
Lender that, should the Liabilities not be recoverable from any Guarantor as
guarantor under this Guaranty for any reason whatsoever (including, without
limitation, by reason of any provision of any of the Liabilities or the
Agreements being or becoming void, unenforceable, or otherwise invalid under any
applicable law) then, notwithstanding any knowledge thereof by any Lender at any
time, each Guarantor as original and independent obligor, upon demand by the
Lenders, will make payment to the Lenders of the Liabilities by way of a full
indemnity.
13. Cumulative Rights and Remedies, Etc. The obligations of each
Guarantor under this Guaranty are continuing obligations and a new cause of
action shall arise in respect of each default hereunder. No course of dealing on
the part of any Lender, nor any delay or failure on the part of any Lender in
exercising any right, power or privilege hereunder, shall operate as a waiver of
such right, power, or privilege or otherwise prejudice the Lenders' rights and
remedies hereunder; nor shall any single or partial exercise thereof preclude
any further exercise thereof or the exercise of any other right, power or
privilege. No right or remedy conferred upon or reserved to any Lender under
this Guaranty is intended to be exclusive of any other right or remedy, and
every right and remedy shall be cumulative and in addition to every other right
or remedy given hereunder or now or hereafter existing under any applicable law.
Every right and remedy given by this Guaranty or by applicable law to the
Lenders may be exercised from time to time and as often as may be deemed
expedient by any Lender.
14. Severability. If any one or more provisions of this Guaranty should
be invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected, impaired, prejudiced or disturbed thereby, and any provision
hereunder found partially unenforceable shall be interpreted to be enforceable
to the fullest extent possible. If at any time all or any portion of the
obligation of any Guarantor under this Guaranty would otherwise be determined by
a court of competent jurisdiction to be invalid, unenforceable or avoidable
under Section 548 of the federal Bankruptcy Code or under any fraudulent
conveyance or transfer laws or similar applicable law of any jurisdiction, then
notwithstanding any other provisions of this Guaranty to the contrary such
obligation or portion thereof of such Guarantor under this Guaranty shall be
limited to the greatest of (i) the value of any quantified economic benefits
accruing to such Guarantor as a result of this Guaranty, (ii) an amount equal to
95% of the excess on the date the relevant Liabilities were incurred of the
present fair saleable value of the assets of such Guarantor over the amount of
all liabilities of such Guarantor, contingent or otherwise, and (iii) the
maximum amount of which this Guaranty is determined to be enforceable.
GUARANTY AGREEMENT
-7-
15. Merger; Amendments. This Guaranty is intended as a final expression
of the subject matter hereof and is also intended as a complete and exclusive
statement of the terms hereof. Each Guarantor's liability hereunder is
independent of and in addition to its liability under any other guaranty
previously of subsequently executed. No course of dealing, course of performance
or trade usage, and no parole evidence of any nature, shall be used to
supplement or modify any terms hereof, nor are there any conditions to the full
effectiveness of this Guaranty. None of the terms and provisions of this
Guaranty may be waived, altered, modified or amended in any way except by an
instrument in writing executed by duly authorized officers of each Lender and
the Guarantors.
16. Consent to Jurisdiction. Notwithstanding the place where any
Liability originates or arises, or is to be repaid, any suit, action or
proceeding arising out of or relating to this Guaranty, any of the Agreements,
or any borrowing made in connection with any of the Agreements, may be
instituted in any court of the United States of America or the State of
Michigan, sitting in the City of Detroit, State of Michigan, and each Guarantor
hereby irrevocably waives any objection which it may have or hereafter have to
the laying of the venue of any such suit, action or proceeding and any claim
that any such suit, action or proceeding has been brought in an inconvenient
forum; and each Guarantor hereby irrevocably submits his person and property to
the jurisdiction of any such court in any such suit, action or proceeding. Each
Guarantor hereby consents to the service of process in any suit, action or
proceeding of the nature referred to in this Section 16 by the mailing of a copy
thereof by registered or certified mail, postage prepaid, or personally
delivering a copy thereof to such Guarantor, at the address set forth under its
signature below, or at such other address as such Guarantor may hereafter
specify to the Lenders in writing. Nothing in this Section 16 shall affect the
right of any Lender to serve process in any other manner permitted by law or
limit the right of the Lenders to bring proceedings against any Guarantor or any
of its property in the courts of any other jurisdiction in which it is subject
to service of process. To the extent that any Guarantor now or hereafter may be
entitled, in any jurisdiction in which proceedings may at any time be commenced
with respect to this Guaranty or the transactions contemplated hereby, to claim
itself or its revenues, assets or properties any immunity (including, without
limitation, immunity from service of process, jurisdiction, suit, judgment,
counterclaim, enforcement of or execution on a judgment, attachment prior to the
judgment, attachment in aid of execution of a judgment or other legal process),
and to the extent that in any such jurisdiction there may be attributed any such
immunity (whether or not claimed), such Guarantor hereby irrevocably undertakes
not to claim and hereby irrevocably waives any such immunity to the fullest
extent permitted by law. Each Guarantor irrevocably and generally consents in
respect of any proceedings to the giving of any relief or the issue of any
process in connection with those proceedings including, without limitation, the
making, enforcement or execution against any assets whatsoever of any order or
judgment which may be made or given in those proceedings.
17. Governing Law; Headings. This Guaranty shall be governed by and
construed in accordance with the laws of the State of Michigan without giving
effect to the choice of law principles of such state. The headings of the
various paragraphs hereof are for the convenience of reference only and shall in
no way modify any of the terms or provisions hereof.
18. Notices. Any notice, demand, consent or request given or made to
each Guarantor by any Lender shall be deemed to have been duly given or made if
sent in writing (including telecommunications) to such Guarantor to the address
or telex or telecopy number set forth below the name of such Guarantor on the
signature page hereof, or at such other address or telex or telecopy number as
such Guarantor may hereafter
GUARANTY AGREEMENT
-8-
specify to the Lenders in writing. All notices or other communications sent by
means of telecopy, telex or other wire transmission shall be made with request
for assurance of receipt in a manner typical with respect to communications of
that type. Written notices or other communications shall be deemed delivered
upon receipt if delivered by hand or by telecopy, three business days after
mailing if mailed, or one business day after deposit with an overnight courier
service if delivered by overnight courier. Notices or other communications
delivered by hand shall be deemed delivered upon receipt.
19. WAIVER OF JURY TRIAL. THE LENDERS, IN ACCEPTING THIS GUARANTY, AND
THE GUARANTORS, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM
MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS
GUARANTY OR ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED BY THIS GUARANTY OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY OF THEM. NEITHER THE LENDERS NOR THE
GUARANTORS SHALL SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH
ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL NOT BE
DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY ANY OF THE
LENDERS OR THE GUARANTORS EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY ALL OF
THEM. THIS GUARANTY IS FREELY AND VOLUNTARILY GIVEN TO THE LENDERS BY THE
GUARANTORS WITHOUT ANY DURESS OR COERCION, AND AFTER EACH GUARANTOR HAS EITHER
CONSULTED WITH COUNSEL OR BEEN GIVEN AN OPPORTUNITY TO DO SO. EACH GUARANTOR HAS
CAREFULLY AND COMPLETELY READ ALL OF THE TERMS AND PROVISIONS OF THIS GUARANTY
AND OF EACH AGREEMENT.
GUARANTY AGREEMENT
-9-
EXECUTED and effective as of the day and year first above written.
UNIVERSAL FOREST PRODUCTS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS INDIANA
LIMITED PARTNERSHIP
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS TEXAS LIMITED
PARTNERSHIP
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS HOLDING
COMPANY, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
GUARANTY AGREEMENT
-10-
UNIVERSAL FOREST PRODUCTS WESTERN
DIVISION, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
SHOFFNER HOLDING COMPANY, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS EASTERN
DIVISION, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS SHOFFNER LLC
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
GUARANTY AGREEMENT
-11-
UNIVERSAL TRUSS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST RECLAMATION CENTER,
INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UNIVERSAL FOREST PRODUCTS OF MODESTO
L.L.C.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
TRESSTAR, LLC
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
GUARANTY AGREEMENT
-12-
UFP VENTURES, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
CONSOLIDATED BUILDING COMPONENTS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UFP REAL ESTATE, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
SYRACUSE REAL ESTATE, LLC
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
UFP VENTURES II, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
-----------------------------
GUARANTY AGREEMENT
-13-
Address for each Guarantor:
2801 Beltline NE
Grand Rapids, MI 49505
Telecopy No.: 616-361-7534
GUARANTY AGREEMENT
-14-
EXHIBIT C
REVOLVING CREDIT NOTE
$______________ November 25, 2002
Detroit, Michigan
FOR VALUE RECEIVED,____________, a___________ (the "Company"), hereby
unconditionally promises to pay to the order of ___________________ (the
"Lender"), at the principal banking office of the Agent in Detroit, Michigan in
[U.S.] [Canadian] Dollars and in Same Day Funds, the principal sum of
__________________ [U.S.] [Canadian] Dollars ([C]$______________) or such lesser
amount as is recorded on the schedule attached hereto, or in the books and
records of the Lender, on the Termination Date; and to pay interest on the
unpaid principal balance hereof from time to time outstanding, in like money and
funds, for the period from the date hereof until the Syndicated Loans evidenced
hereby shall be paid in full, at the rates per annum and on the dates provided
in the Credit Agreement referred to below.
The Lender is hereby authorized by the Company to record on the
schedule attached to this Revolving Credit Note, or on its books and records,
the date, amount and type of each Syndicated Loan, the duration of the related
Interest Period (if applicable), the amount of each payment or prepayment of
principal thereon and the other information provided for on such schedule, which
schedule or such books and records, as the case may be, shall constitute prima
facie evidence of the information so recorded, provided, however, that any
failure by the Lender to record any such information shall not relieve the
Company of its obligation to repay the outstanding principal amount of such
Syndicated Loans, all accrued interest thereon and any amount payable with
respect thereto in accordance with the terms of this Revolving Credit Note and
the Credit Agreement.
The Company and each endorser or guarantor hereof waives demand,
presentment, protest, diligence, notice of dishonor and any other formality in
connection with this Revolving Credit Note. Should the indebtedness evidenced by
this Revolving Credit Note or any part thereof be collected in any proceeding or
be placed in the hands of attorneys for collection, the Company agrees to pay,
in addition to the principal, interest and other sums due and payable hereon,
all costs of collecting this Revolving Credit Note, including attorneys' fees
and expenses (including without limitation allocated costs and expenses of
attorneys who are employees of the Lender).
This Revolving Credit Note evidences one or more Syndicated Loans made
under a Credit Agreement, dated as of November 25, 2002 (as amended or modified
from time to time, the "Credit Agreement"), by and among the Company, the other
Borrower, the lenders party thereto from time to time (including the Lender),
Bank One, NA, as Agent, Wachovia Bank, N.A., as Syndication Agent, and Standard
Federal Bank, N.A., as Documentation Agent, to which reference is hereby made
for a statement of the circumstances under which this Revolving Credit Note is
subject to prepayment and under which its due date may be accelerated.
Capitalized terms used but not defined in this Revolving Credit Note shall have
the respective meanings assigned to them in the Credit Agreement.
This Revolving Credit Note is made under, and shall be governed by and
construed in accordance with, the laws of the State of Michigan in the same
manner applicable to contracts made and to be performed entirely within such
State and without giving effect to choice of law principles of such State.
----------------------------------------
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
REVOLVING CREDIT NOTE
-2-
Schedule to Revolving Credit Note, dated
November_____, 2002, made by________________
in favor of _________
<Table>
<Caption>
Principal
Amount
Trans- Principal Type Interest Paid, Pre- Principal
action Amount of of Interest Period (if paid or Balance Notation
Date Loan Loan* Rate applicable) Converted Outstanding Made by
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
</Table>
- -----------
* E - Syndicated Eurodollar Rate
F - Floating Rate
B - BA Rate
REVOLVING CREDIT NOTE
-3-
EXHIBIT D
SWINGLINE NOTE
$_____________ November 25, 2002
Detroit, Michigan
FOR VALUE RECEIVED, Universal Forest Products, Inc., a Michigan
corporation (the "Company"), hereby promises to pay to the order of Bank One, NA
(the "Agent"), at the principal banking office of the Agent in Detroit, Michigan
in U.S. Dollars and in Same Day Funds, the principal sum of _______U.S. Dollars
($________ ), or such lesser amount as is recorded on the schedule attached
hereto or in the books and records of the Agent, on the Termination Date or such
earlier date as the Agent may require in its sole discretion; and to pay
interest on the unpaid principal balance hereof from time to time outstanding,
in like money and funds, for the period from the date hereof until the Swingline
Loans evidenced hereby shall be paid in full, at the rates per annum and on the
dates provided in the Credit Agreement referred to below.
The Agent is hereby authorized by the Company to record on the schedule
attached to this Swingline Note, or on its books and records, the date and the
amount of each Swingline Loan, the applicable interest rate and type and the
duration of the related Interest Period (if applicable), the amount of each
payment or prepayment of principal thereon, and the other information provided
for on such schedule, which schedule or such books and records, as the case may
be, shall constitute prime facie evidence of the information so recorded,
provided, however, that any failure by the Agent to record any such notation
shall not relieve the Company of its obligation to repay the outstanding
principal amount of this Swingline Note, all accrued interest hereon and any
amount payable with respect hereto in accordance with the terms of this
Swingline Note and the Credit Agreement.
The Company and each endorser or guarantor hereof waives presentment,
protest, notice of dishonor and any other formality in connection with this
Swingline Note. Should the indebtedness evidenced by this Swingline Note or any
part thereof be collected in any proceeding or be placed in the hands of
attorneys for collection, the Company agrees to pay, in addition to the
principal, interest and other sums due and payable hereon, all costs of
collection of this Swingline Note, including attorneys' fees and expenses.
This Swingline Note evidences Swingline Loans made under a Credit
Agreement, dated as of November 25, 2002 (as amended or modified from time to
time, the "Credit Agreement"), by and among the Company, the Canadian Borrower,
the lenders party thereto from time to time (including the Lender), the Agent,
Wachovia Bank, N.A., as Syndication Agent, and Standard Federal Bank, N.A., as
Documentation Agent, to which reference is hereby made for a statement of the
circumstances under which this Swingline Note is subject to prepayment and under
which its due date may be accelerated. Capitalized terms used but not defined in
this Swingline Note shall have the respective meanings assigned to them in the
Credit Agreement.
This Swingline Note is made under, and shall be governed by and
construed in accordance with, the laws of the State of Michigan in the same
manner applicable to contracts made and to be performed entirely within such
State and without giving effect to choice of law principles of such State.
UNIVERSAL FOREST PRODUCTS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
SWINGLINE NOTE
-2-
Schedule to Swingline Note dated November__, 2002
made by Universal Forest
Products, Inc.
in favor of Bank One, NA
<Table>
<Caption>
Principal Principal
Transaction Amount of Applicable Interest Amount Paid Balance Notation
Date Loan Interest Rate Period or Prepaid Outstanding Made By
- ------------- ------------- ------------- ------------- ------------- ------------- -------------
</Table>
SWINGLINE NOTE
-3-
EXHIBIT E
BID-OPTION QUOTE REQUEST
[Date]
Bank One, NA,
as Agent for the Lenders
611 Woodward Avenue
Detroit, Michigan 48226
Attention:______________
Universal Forest Products, Inc., a Michigan corporation (the
"Company"), hereby requests offers to make Bid-Option Loans comprising the
Bid-Option Borrowing(s) described below pursuant to Section 2.2(b) of the Credit
Agreement, dated as of November __, 2002, as amended, supplemented or otherwise
modified (the "Credit Agreement"), by and among the Company, the Canadian
Borrower, Bank One, NA, as Agent, Wachovia Bank, N.A., as Syndication Agent, and
Standard Federal Bank, N.A., as Documentation Agent. Capitalized terms used but
not defined herein shall have the respective meanings ascribed thereto in the
Credit Agreement.
Date of Bid-Option Borrowing(s): ________, ____
Type of Bid-Option Borrowing(s): ____________ [Absolute Rate]
[Eurodollar Rate]
Aggregate Amount of each Bid-Option Borrowing: (a) *
----------------
(b)
----------------
(c)
----------------
Interest Period: (a) **
-------------
(b)
-------------
(c)
-------------
UNIVERSAL FOREST PRODUCTS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
*Must be (a) $3,000,000 or a larger multiple of $1,000,000.
**Must comply with the definition of the term "Bid-Option Interest Period."
EXHIBIT F
INVITATION FOR BID-OPTION QUOTES
[Date]
To: [Name of Lender]
Attention: ____________________
Reference is made to the Credit Agreement, dated as of November , 2002,
as amended, supplemented or otherwise modified (the "Credit Agreement"), by and
among Universal Forest Products, Inc. (the "Company"), the Canadian Borrower,
the lenders party thereto from time to time, Bank One, NA, as Agent, Wachovia
Bank, N.A., as Syndication Agent, and Standard Federal Bank, N.A., as
Documentation Agent. Capitalized terms used but not defined herein shall have
the respective meanings ascribed thereto in the Credit Agreement.
Pursuant to Section 2.2(c) of the Credit Agreement, Bank One, NA, as
Agent, is pleased on behalf of the Company to invite you to submit Bid-Option
Quotes to the Company for the Bid-Option Borrowing(s) described below.
Date of Bid-Option Borrowing(s): ________, ____
Type of Bid-Option Borrowing(s): [Absolute Rate] [Eurodollar Rate]
Aggregate Amount of Each
Bid-Option Borrowing: Interest Period:
------------------------ ----------------
(a) (a)
-------------------- ----------------
(b) (b)
-------------------- ----------------
(c) (c)
-------------------- ----------------
Please respond to this invitation by no later than 9:00 a.m.
(Detroit time) on _________________, _____.*
BANK ONE, NA, as Agent
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
* The proposed date of Borrowing in the case of Absolute Rate Bid-Option
Borrowings. The third Business Day prior to the proposed date of Borrowing
in the case of Eurodollar Rate Bid-Option Borrowings.
EXHIBIT G
BID-OPTION QUOTE
[Date]
Bank One, NA, as Agent
611 Woodward Avenue
Detroit, Michigan 48226
Attention:_____________
Reference is made to the Credit Agreement, dated as of November __,
2002, as amended, supplemented or otherwise modified (the "Credit Agreement"),
by and among Universal Forest Products, Inc. (the "Company"), the Canadian
Borrower, the lenders party thereto from time to time (including the Lender),
Bank One, NA, as Agent, Wachovia Bank, N.A., as Syndication Agent, and Standard
Federal Bank, N.A., as Documentation Agent. Capitalized terms used but not
defined herein shall have the respective meanings ascribed thereto in the Credit
Agreement.
In response to your Invitation for Bid-Option Quotes dated____________,
________,________________ (the "Lender"), hereby makes the following offer[s] to
make [a] Bid-Option Loan[s]:
1. Quoting Lender:
-----------------------------
Contact Person:
-----------------------------
2. Date of proposed Borrowing: , *
---------- -------
3. Quotes:
<Table>
<Caption>
Bid-Option Absolute
Type of Bid-Option Rate or Bid-Option
Loans: Absolute Rate Principal Eurodollar Rate Interest
or Eurodollar Rate** Amount*** Margin**** Period *****
-------------------- --------- ------------------- ------------
(a)
----------------------- --------- ------------------- -----------
(b)
----------------------- --------- ------------------- -----------
(c)
----------------------- --------- ------------------- -----------
</Table>
4. The aggregate amount of Bid-Option Loans which may be accepted by
the Company pursuant to this Bid-Option Quote shall not exceed $_____________.
The Lender acknowledges and agrees that this Bid-Option Quote (a) is
irrevocable and (b), subject to the terms and conditions of the Credit
Agreement, obligates it to make a Bid-Option Loan for which any quote is
accepted, in whole or in part.
[Name of Lender]
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
* As specified in the related Invitation for Bid-Option Quotes.
** As specified in the related Invitation for Bid-Option Quotes.
*** The principal amount (a) must be $3,000,000 or a larger multiple of
$1,000,000 and (b) may not exceed the aggregate amount of the related
Bid-Option Borrowing specified in the related Invitation for Bid-Option
Quotes.
**** Specify rate of interest per annum (rounded up to the nearest 1/1000th
of 1%) or applicable margin, which may be positive or negative,
expressed as a percentage (rounded up to the nearest 1/1000th of 1%),
as the case may be.
***** As specified in the related Invitation for Bid-Option Quotes.
BID-OPTION QUOTE
-2-
EXHIBIT H
REQUEST FOR SYNDICATED ADVANCE
To each Lender party to
the referenced Credit Agreement
c/o Bank One, NA, as Agent for the Lenders
611 Woodward Avenue
Detroit, Michigan 48226
Attention:____________________
_____________, a _______________ (the "Borrower") hereby requests a
[insert Syndicated Loan, or Letter of Credit Advance] pursuant to Section 2.6 of
the Credit Agreement, dated as of November __, 2002 (as amended or modified from
time to time, the "Credit Agreement"), among the Borrowers, the lenders party
thereto from time to time, Bank One, NA, as Agent, Wachovia Bank, N.A., as
Syndication Agent, and Standard Federal Bank, N.A., as Documentation Agent.
[A Syndicated Loan is requested to be made in the amount of
[C]$____________, to be made on ____________, _____ and evidenced by the
Borrower's Revolving Credit Notes. Such Loan shall be a [insert Eurodollar Rate
Syndicated Loan, BA Rate Syndicated Loan, or Floating Rate Loan] and the initial
Interest Period, if such requested Loan is a Eurodollar Rate Syndicated Loan or
a BA Rate Syndicated Loan, shall be [insert permitted Interest Period].]
[Such Letter of Credit Advance shall be made by the issuance by the
Agent of its Letter of Credit for the account of the Borrower in the maximum
stated amount of $___________ to and for the benefit of ________________ with a
stated expiry date of _________________, _____, and containing the further terms
and conditions set forth in the attached letter of credit application to the
Agent.]
In support of this request, the Borrower hereby represents and warrants
to the Agent and the Lenders that:
1. The representations and warranties contained in the Credit Agreement
are true and correct in all material respects on and as of the date hereof, and
will be true and correct in all material respects on the date such Advance is
made (both before and after such Advance is made), as if such representations
and warranties were made on and as of such dates.
2. No Event of Default or Default has occurred and is continuing or
will exist on the date such Advance is made and such Advance shall not cause an
Event of Default or Default.
Acceptance of the proceeds of such Advance by the Borrower shall be deemed to be
a further representation and warranty that the representations and warranties
made herein are true and correct in all material respects at the time such
proceeds are disbursed.
Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Credit Agreement.
By:
-------------------------------------
Print Name:
-----------------------
Its:
------------------------------
Dated: ,
---------------- ----
REQUEST FOR SYNDICATED ADVANCE
-2-
EXHIBIT J
COMPLIANCE CERTIFICATE
To: The Lenders party to the
Credit Agreement described below
This Compliance Certificate is furnished pursuant to that certain
Credit Agreement dated as of November __, 2002 (as amended, modified, renewed or
extended from time to time, the "Credit Agreement") among Universal Forest
Products, Inc., a Michigan corporation (the "Company"), the Canadian Borrower,
the lenders party thereto from time to time, Bank One, NA, as Agent, Wachovia
Bank, N.A., as Syndication Agent, and Standard Federal Bank, N.A., as
Documentation Agent. Unless otherwise defined herein, capitalized terms used in
this Compliance Certificate have the meanings ascribed thereto in the Credit
Agreement.
THE UNDERSIGNED CERTIFIES THAT:
1. I am the duly elected [Chief Financial Officer or Treasurer] of the
Company.
2. I have reviewed the terms of the Credit Agreement and I have made,
or have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company and its Subsidiaries during the
accounting period covered by the attached financial statements.
3. The representations and warranties made by the Company contained in
each Loan Document are true and correct as though made on and as of the date
hereof.
4. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
an Event of Default or Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Compliance Certificate, except as set forth below.
5. Schedule I attached hereto sets forth financial data and
computations evidencing the Company's compliance with certain covenants of the
Credit Agreement, all of which data and computations are true, complete and
correct.
6. Schedule II attached hereto sets forth the various reports and
deliveries which are required at this time under the Credit Agreement and the
other Loan Documents and the status of compliance.
Described below are the exceptions, if any, to paragraph 4 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking, or proposes to
take with respect to each such condition or event:
1
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
The foregoing certifications, together with the computations set forth
in Schedule I and the various reports and deliveries set forth in Schedule II
hereto and the financial statements delivered with this Certificate in support
hereof, are made and delivered on _______________, 200__.
----------------------------------
Print Name:
-----------------------
Title:
----------------------------
2
SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of _________, ____ with
provisions of Section 5.2 of
the Credit Agreement
3
SCHEDULE II TO COMPLIANCE CERTIFICATE
Reports and Deliveries Currently Due
4
EXHIBIT K
SOLVENCY CERTIFICATE
This Certificate is made and delivered to Bank One, NA, as Agent, in
connection with the Credit Agreement dated as of November , 2002 (the "Credit
Agreement") among Universal Forest Products, Inc., a Michigan corporation (the
"Company"), the Canadian Borrower, the lenders party thereto from time to time
(the "Lenders"), Bank One, NA, as Agent for the Lenders (the "Agent"), Wachovia
Bank, N.A., as Syndication Agent, and Standard Federal Bank, N.A., as
Documentation Agent, and all other Loan Documents. Terms used but not defined
herein shall have the meanings ascribed thereto in the Credit Agreement.
Pursuant to the Credit Agreement, and acting solely in my capacity as
an officer of the Company and not in my individual capacity I hereby certify as
follows:
1. I am the duly elected, qualified and acting chief financial
officer of the Company and I have been responsible for acting
on behalf of the Company and each Subsidiary in connection
with the negotiation and consummation of the Loan Documents.
In connection with these negotiations, I have been responsible
for, among other things, reviewing the affairs of the Company
and the Subsidiaries.
2. I have further, for purposes hereof, reviewed the assets and
liabilities of the Company and the Subsidiaries, after giving
effect to the transactions contemplated by the Loan Documents.
In particular:
A. I have reviewed the financial statements referred to
in Section 4.6 of the Credit Agreement.
B. With respect to contingent and off-balance sheet
liabilities included in the liabilities of the
Company and its Subsidiaries, I have consulted with
the appropriate officers and employees of the Company
and its Subsidiaries and outside counsel of the
Company concerning pending and threatened litigation
and other contingent liabilities of the Company and
its Subsidiaries.
On the basis of the review and analysis described above, I have
concluded that:
I. (i) Immediately after the consummation of the Loan Documents and
transactions to occur on the date hereof and immediately following the making of
the Advances on the date hereof and after giving effect to the application of
the proceeds of such Advances, (a) the fair value of the assets of the Company
and the Subsidiaries on a consolidated basis, at a fair valuation, will exceed
the debts and liabilities, subordinated, contingent or otherwise, of the Company
and the Subsidiaries on a consolidated basis; (b) the present fair saleable
value of the assets of the Company and the Subsidiaries on a consolidated basis
will be greater than the amount that will be required to pay the probable
liability of the Company and the Subsidiaries on a consolidated basis on their
debts and other liabilities, subordinated, contingent or otherwise, as such
debts and other liabilities become absolute and matured; (c) the Company and the
Subsidiaries on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) the Company and the
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(ii) The Company does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.
II. To the best of my knowledge, none of the Company or the
Subsidiaries has executed any Loan Document or any documents mentioned therein
or made any transfer or incurred any obligation thereunder or in connection
therewith with actual intent to hinder, defraud or delay either present or
future creditors.
Executed and delivered on November_______, 2002.
UNIVERSAL FOREST PRODUCTS, INC.
By:
-------------------------------------
Print Name:
-----------------------
Title:
----------------------------
-2-
EXHIBIT L
REQUEST FOR CONTINUATION OR
CONVERSION OF SYNDICATED LOAN
[Date]
To each Lender party
to the referenced Credit Agreement
c/o Bank One, NA,
as Agent for the Lenders
611 Woodward Avenue
Detroit, Michigan 48226
Attention:_______________________
_________,a________, a (the "Company"), hereby requests that [C]
$______________ of the principal amount of the Syndicated Loan originally made
on ____________, ____, which Syndicated Loan is currently a [insert type of
Loan], be continued as or converted to, as the case may be, a [insert type of
Loan requested] on ______________, ____. If such Loan is requested to be
converted to a Eurodollar Rate Syndicated Loan or a BA Rate Syndicated Loan, the
Company hereby elects an Interest Period for such Loan of [insert permitted
Interest Period].
In support of this request, the Company hereby represents and warrants
to the Agent and the Lenders that:
1. The representations and warranties contained in the Credit Agreement
are true and correct in all material respects on and as of the date hereof, and
will be true and correct in all material respects on the date such Loan is
[continued][converted] (both before and after such Loan is
[continued][converted]), as if such representations and warranties were made on
and as of such dates.
2. No Event of Default or Default has occurred and is continuing or
will exist on the date such Loan is [continued][converted] (whether before or
after such Loan is [continued][converted]).
Acceptance of the proceeds of such [continued][converted] Loan by the Company
shall be deemed to be a further representation and warranty that the
representations and warranties made herein are true and correct in all material
respects at the time of such [continuation] [conversion].
Capitalized terms used but not defined herein shall have the respective
meanings assigned to them in the Credit Agreement, dated as of November __,
2002, among the Company, the other Borrower, the lenders party thereto from time
to time (the "Lenders"), Bank One, NA, as Agent, Wachovia Bank, N.A., as
Syndication Agent, and Standard Federal Bank, N.A., as Documentation Agent.
----------------------------------------
By:
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Print Name:
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Its:
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REQUEST FOR CONTINUATION OR
CONVERSION OF SYNDICATED LOAN
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EXHIBIT M
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of November __, 2002
(as amended or modified from time to time, the "Credit Agreement") among
Universal Forest Products, Inc., a Michigan corporation, the Canadian Borrower,
the lenders party thereto from time to time, Bank One, NA, as Agent, Wachovia
Bank, N.A., as Syndication Agent, and Standard Federal Bank, N.A., as
Documentation Agent. Terms defined in the Credit Agreement are used herein with
the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:
1. The Assignor hereby sells and assigns (without recourse) to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement as of the date hereof equal to the interest specified on Schedule 1 of
all outstanding rights and obligations under the Credit Agreement. After giving
effect to such sale and assignment, the Assignee's Commitments will be as set
forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Credit Agreement
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Borrower or the
performance or observance by any Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Note or Notes held by the Assignor and requests that the
Agent exchange such Note or Notes for a new Note or Notes payable to the order
of the Assignee in an amount equal to the Commitments assumed by the Assignee
pursuant hereto and the Assignor in an amount equal to the Commitments retained
by the Assignor under the Credit Agreement, respectively, as specified on
Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.6 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon the Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iii) appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers and discretion under the Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers and discretion as are reasonably incidental thereto; (iv) agrees that it
will perform in accordance with their terms all of the obligations that by the
terms of the Credit Agreement are required to be performed by it as a Lender;
and (v) if the Assignee is organized under the laws of a jurisdiction outside
the United States, attaches the forms prescribed by the Internal Revenue Service
of the United States certifying as to the Assignee's status for purposes of
determining exemption from United States withholding taxes with respect to all
payments to be made to the Assignee under the Credit Agreement and the Notes or
such other documents as are necessary to indicate that all such payments are
subject to such taxes at a rate reduced by an applicable tax treaty.
4. Following the execution of this Assignment and Acceptance, it will
be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1.
5. Upon such acceptance and recording by the Agent, as of the Effective
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and be bound by the terms and provisions
applicable to a Lender under the Loan Documents (including without limitation
the Intercreditor Agreement) and (ii) the Assignor shall, to the extent provided
in this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after the
Effective Date, the Agent shall make all payments under the Credit Agreement and
the Notes in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and commitment fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes for periods
prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Michigan.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.
ASSIGNMENT AND ACCEPTANCE
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SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE
[___________________, as Assignor, and _________________, as Assignee]
Amount of Assignor's Commitment assigned to Assignee: $_____________
Effective Date: ______________
_________________________, as Assignor
By:
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Its:
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__________________________, as Assignee
By:
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Its:
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Address for Notices:
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Attention: _____________
Facsimile No.: ______________
Telephone No.: ______________
Commitment amount of the Assignee after
giving effect to this Assignment and
Acceptance:
$
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Consented to and accepted this__ day
of _______________, ____
BANK ONE, NA, as Agent
By:
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Print Name:
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Its:
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[BORROWER]
By:
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Print Name:
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Its:
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