Exhibit 10.22
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TERM LOAN AGREEMENT
dated as of July 31, 2002,
among
AWP LTD.,
VARIOUS FINANCIAL INSTITUTIONS and
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Administrative Agent,
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TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT (this "Agreement") dated as of July 31, 2002
is among AWP LTD., a Bermuda company, company number 32233, to be renamed APW
Ltd. (the "Borrower"), the financial institutions listed on the signature pages
hereof (together with their respective successors and assigns, collectively the
"Lenders" and individually each a "Lender"), and BANK OF AMERICA, NATIONAL
ASSOCIATION, as Administrative Agent (in such capacity, the "Administrative
Agent").
WHEREAS, on May 16, 2002 (the "Commencement Date"), APW Ltd., a Bermuda
company (to be renamed BQX Ltd.) ("Oldco") and its wholly owned indirect
subsidiary, Vero Electronics, Inc. (the "Debtors") filed with the United States
Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court")
a voluntary petition for relief under chapter 11 of title 11, United States Code
(the "Bankruptcy Code"); and
WHEREAS, on May 30, 2002, a proceeding was commenced pursuant to the
Companies Act 1981 with respect to Oldco in the Bermuda Supreme Court in
connection with a winding-up petition; and
WHEREAS, on May 30, 2002, the Bermuda court appointed Malcolm L.
Butterfield of KPMG Bermuda and Philip W. Wallace of KPMG, London, England as
joint provisional liquidators of Oldco;
WHEREAS, on July 23, 2002, the Bankruptcy Court entered a Confirmation
Order (as defined herein) confirming the Amended and Restated Plan of
Reorganization of the Debtors dated as of June 19, 2002 (as further amended,
modified or restated hereafter, the "Plan"); and
WHEREAS, pursuant to the terms of the Plan, all of the assets which
were to be retained by Reorganized APW (as defined the Plan) under the Plan
shall be and have been assigned by Oldco to Borrower and Borrower has accepted
the assignment of such assets, and all of the liabilities which were to be
retained by Reorganized APW under the Plan shall be and have been assigned by
Oldco to Borrower and Borrower has accepted the assignment of such liabilities;
WHEREAS, Oldco is indebted to the Lenders under (i) that certain
Amended and Restated Multicurrency Credit Agreement, dated May 15, 2001, among
the Borrower, certain financial institutions, Bank of America, N.A., as
administrative agent, JPMorgan Chase Bank, as documentation agent and Bank One
NA, as syndication agent, as amended (the "U.S. Pre-Petition Credit Agreement")
and (ii) collectively and without double counting (A) the Revolving Credit
Facilities, as amended and restated from time to time, with Royal Bank of
Scotland, PLC; (B) the Counter Indemnity Agreement, as amended and restated
dated as of April 26, 2001, with National Westminster Bank PLC; (C) the Payment
Agreement dated June 28, 2002 with National Westminster Bank PLC; (D) the
Multiline Facility Agreement, as amended and restated dated as of May 15, 2001,
with National Westminster Bank PLC; and (E) any loan note guaranties provided by
National Westminster Bank PLC pursuant to the deeds of adherence and release
entered into by Bank of America and National Westminster Bank PLC on or around
July 31, 2000 (together the "Pre-Petition U.K. Credit Agreement"; and together
with the U.S. Pre-Petition U.S. Credit Agreement, the "Pre-Petition Credit
Agreements");
WHEREAS pursuant to the Plan the indebtedness under the Pre-Petition
Credit Agreements shall be exchanged for certain Loans, as defined herein, and
certain equity interests in the Borrower;
NOW, THEREFORE, the U.S. Pre-Petition Credit Agreement is hereby
amended and restated in its entirety as follows and the parties further agree as
follows:
ARTICLE I
CERTAIN DEFINITIONS AND INTERPRETATION
1.1 Defined Terms. When used herein the following terms have the
following meanings (such meanings to be applicable to both the singular and
plural forms of the terms defined):
"Administrative Agent" means Bank of America in its capacity as
Administrative Agent for the Lenders hereunder and any successor
Administrative Agent arising under Section 10.9.
"Administrative Fee Letter" means the letter of the
Administrative Agent to the Borrower dated July 26, 2002.
"Affiliate" means, with respect to any Person, any other Person
which, directly or indirectly, controls, is controlled by or is under
common control with such Person. For purposes of this definition,
"control" (together with the correlative meanings of "controlled by"
and "under common control with") means possession, directly or
indirectly, of the power (a) to vote 5% or more of the securities (on a
fully diluted basis) having ordinary voting power for the directors or
managing general partners (or their equivalent) of such Person or (b)
to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by contract
or otherwise.
"Agent-Related Persons" means the Administrative Agent and any
successor agent arising under Section 10.9, together with their
respective Affiliates, and the officers, directors, employees, agents,
attorneys, consultants, and attorneys-in-fact of such Persons and
Affiliates.
"Agents" has the meaning specified in Section 10.1.
"Agreement" means this Term Agreement.
"Amendment and Confirmation" means the amendment and confirmation
in substantially the form of Exhibit.
"Applicable Margin" means:
(i) 3.50% with respect to Offshore Rate Loans; and
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(ii) 1.50% with respect to Base Rate Loans;
provided, however, that commencing with the first day of the fiscal
quarter of the first Interest Deferral, the Applicable Margin shall be
increased by 0.25% per annum.
"Assignee" has the meaning specified in Section 11.8(a).
"Assignment and Acceptance" has the meaning specified in Section
11.8(a).
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the reasonable
allocated cost of internal legal services and all reasonable
disbursements of internal counsel.
"Authorized Officer" means, with respect to the Borrower, those
of its officers whose signatures and incumbency shall have been
certified to the Lenders pursuant to Section 6.1(b)(v).
"Bank of America" means Bank of America, National Association, a
national banking association.
"Bankruptcy Code" has the meaning specified in the recitals.
"Bankruptcy Court" has the meaning specified in the recitals.
"Base Rate" means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate; and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank
of America as its "prime rate." (The "prime rate" is a rate set by Bank
of America based upon various factors including Bank of America's costs
and desired return, general economic conditions and other factors, and
is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate.) Any change in such
rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan in Dollars that bears interest
based on the Base Rate.
"Borrower" has the meaning specified in the preamble.
"Borrowing" means a borrowing hereunder consisting of Loans of
the same Type, and, in the case of Offshore Rate Loans, having the same
Interest Period.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial Lenders in London, England, Dallas, Texas
or New York, New York are authorized or required by law to close and
with respect to disbursements and payments with respect to Offshore
Rate Loans, a day on which dealings are carried on in the applicable
offshore Dollar interbank market.
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"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law,
in each case, regarding capital adequacy of any bank or of any
corporation controlling a bank.
"Capital Expenditures" means, for any period, the sum of
(a) the aggregate amount of all expenditures of the Borrower and
its Subsidiaries for fixed or capital assets made during such period
which, in accordance with GAAP, would be classified as capital
expenditures; and
(b) the aggregate amount of all Capitalized Lease Liabilities
incurred during such period.
"Capital Lease" means, with respect to any Person, any lease of
(or other agreement conveying the right to use) any real or personal
property which, in conformity with GAAP, is accounted for as a capital
lease on the balance sheet of such Person.
"Capitalized Lease Liabilities" means all monetary obligations of
the Borrower or any of its Subsidiaries under any leasing or similar
arrangement which, in accordance with GAAP, would be classified as
capitalized leases, and, for purposes of this Agreement and each other
Loan Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP, and the stated
maturity thereof shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which
such lease may be terminated by the lessee without payment of a
penalty.
"Cash Equivalent" means any of the following, to the extent owned
by the Borrower or any of its Subsidiaries, free and clear of all Liens
other than Liens created under the Collateral Documents or Permitted
Liens: (a) marketable direct obligations of the Government of the
United States or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the
Government of the United States having a maturity of not greater than
360 days from the date of issuance thereof, (b) overnight bank
deposits, bankers acceptances, certificates of deposit or time deposits
having a maturity of not greater than 360 days from the date of
issuance thereof with any commercial bank that is a Lender or a member
of the Federal Reserve System that issues (or the parent of which
issues) commercial paper rated as described in clause (c) and is
organized under the laws of the United States, any State thereof or the
District of Columbia and has combined capital and surplus of at least
$500,000,000, (c) commercial paper having a maturity of not greater
than 180 days from the date of issuance thereof in an aggregate amount
of no more than $2,500,000 per issuer outstanding at any time, issued
by any corporation organized under the laws of any State of the United
States and rated at least "Prime-1" (or the then equivalent grade) by
Moody's Investors Service, Inc. or "A-1" (or the then equivalent grade)
by Standard & Poor's Ratings Group, or (d) shares of money market
mutual or similar funds which invest only in assets satisfying the
requirements of clause (a) through (c) of this definition.
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"Cash Restructuring Expenses" means cash disbursements relating
to Restructuring Expenses incurred by the Borrower and its Subsidiaries
during any given period.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended.
"Chapter 11 Cases" means the chapter 11 cases of the Debtors
commenced May 16, 2002 in the Bankruptcy Court.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means all property, assets and/or rights on or in
which a Lien is now or hereafter granted by the Borrower or any of its
Subsidiaries to the Administrative Agent, the U.S. Collateral Agent or
the U.K. Collateral Agent (or to any agent, trustee or other party
acting on behalf of the Administrative Agent, the U.S. Collateral Agent
or the U.K. Collateral Agent) for the benefit of the Lenders, pursuant
to the Collateral Documents, and any other instruments or documents
provided for herein or therein or delivered hereunder or thereunder or
in connection herewith or therewith.
"Collateral Agent" means the U.S. Collateral Agent and/or the
U.K. Collateral Agent.
"Collateral Documents" shall mean the documents pursuant to which
Liens on Collateral are created for the benefit of the Administrative
Agent, the U.S. Collateral Agent or the U.K. Collateral Agent and the
Lenders including, without limitation, documents described in Section
4.3.
"Collateral Guarantor" means a Guarantor with respect to which
the Administrative Agent or a Collateral Agent has a security interest
(second in priority only to Prior Permitted Liens and as set forth in
the Intercreditor Agreement), in substantially all its assets.
"Commencement Date" means has the meaning specified in the
recitals.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit B.
"Confirmation Order" means the order of the Bankruptcy Court
dated July 23, 2002 confirming the Plan.
"Consolidated Interest Expense" means, for any period, the
consolidated interest expense of a Person and its Subsidiaries for such
period, as determined in accordance with GAAP and in any event
including, without duplication, all commissions, discounts and other
fees and charges owed with respect to letters of credit and banker's
acceptances, net costs under interest rate protection agreements, the
portion of any Capital Leases allocable to consolidated interest
expense and losses and discounts attributable to the sale of
receivables and related assets.
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"Consolidated Net Income" means, for any period, all amounts
which, in conformity with GAAP, would be included under net income on a
consolidated income statement of a Person and its Subsidiaries for such
period, exclusive of Affiliate equity earnings, inclusive of Affiliate
cash dividends (to the extent of Affiliate equity earnings).
"Contractual Obligation" means, relative to the Borrower or any
Subsidiary, any provision of any security issued by the Borrower or
such Subsidiary or of any Instrument or undertaking to which the
Borrower or such Subsidiary is a party or by which it or any of its
property is bound.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as
a single employer under Section 414(b) or 414(c) of the Code or Section
4001 of ERISA.
"Conversion/Continuation Date" means any date on which, under
Section 2.4, the Borrower (a) converts Loans of one Type to another
Type, or (b) continues Loans as Loans of the same Type, but with a new
Interest Period.
"Debentures" means the debentures dated on or about May 15, 2001
among certain companies listed on the attached Schedule 1.1 created in
favour of (a) Bank of America, N.A., as Security Trustee, and (b) Royal
Bank of Scotland Plc, as Security Trustee, as amended and supplemented.
"Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, whether or not
evidenced by bonds, debentures, notes or similar instruments, (b) all
obligations of such Person as lessee under Capital Leases which have
been recorded as liabilities on a balance sheet of such Person, (c) all
obligations of such Person to pay the deferred purchase price of
property or services (other than current accounts payable in the
ordinary course of business), (d) all indebtedness secured by a Lien on
the property of such Person, whether or not such indebtedness shall
have been assumed by such Person (it being understood that if such
Person has not assumed or otherwise become personally liable for any
such indebtedness, the amount of the Debt of such Person in connection
therewith shall be limited to the lesser of the face amount of such
indebtedness or the fair market value of all property of such Person
securing such indebtedness), (e) all obligations, contingent or
otherwise, with respect to the face amount of all letters of credit
(whether or not drawn) and banker's acceptances issued for the account
of such Person, (f) all obligations of such Person in respect of Swap
Contracts, (g) all Suretyship Liabilities of such Person, (h) any
liability under any so-called "synthetic lease" transaction entered
into by such Person, (i) all Debt (as defined above) of any partnership
in which such Person is a general partner, (j) the outstanding
principal amount then owed to investors in connection with the sale of
the accounts receivable of a Person or any Subsidiary of a Person and
(k) all obligations of such Person, contingent or otherwise, to
purchase, redeem, retire or otherwise acquire for value any capital
stock of such Person; provided, however, that neither the Valencia
Lease nor the principal amount of the Loan Notes shall constitute Debt
hereunder. The amount of the Debt of any Person in respect of Swap
Contracts shall be deemed to be the
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unrealized net loss position of such Person thereunder (determined for
each counterparty individually, but netted for all Swap Contracts
maintained with such counterparty).
"Debtors" has the meaning specified in the recitals.
"Default" means any event which if it continues uncured will,
with lapse of time or notice or lapse of time and notice, constitute an
Event of Default.
"Disclosure Schedule" means the Disclosure Schedule attached
hereto as Schedule 1.2.
"Dissolution Subsidiary" shall mean any dormant and inactive
subsidiary, with the majority of its assets consisting of
inter-affiliate receivables and investments, which are scheduled to be
dissolved as soon as practicable after Effective Date, as listed on
Item 1.1 to the Disclosure Schedule.
"Documents" means all documents as such term is defined in the
UCC, including bills of lading, warehouse receipts or other documents
of title, now owned or hereafter acquired by the Borrower or any
Collateral Guarantor.
"Dollar(s)" and the sign "$" mean lawful money of the United
States of America.
"Domestic Subsidiary" means a Subsidiary that is created or
organized in or under the law of the United States, any State thereof
or the Commonwealth of Puerto Rico.
"EBITDA" means, for any period, the sum of (a) Consolidated Net
Income for such period, plus (b) the aggregate amount deducted (or
minus the aggregate amount added) with respect to federal, state, local
and foreign income taxes in determining such Consolidated Net Income,
plus (c) Consolidated Interest Expense for such period (net of
consolidated interest income of a Person and its Subsidiaries for such
period), plus (d) depreciation and amortization for such period, plus
(e) to the extent deducted in determining Consolidated Net Income,
Reorganization Items for such period, plus (f) to the extent deducted
in determining Consolidated Net Income, Restructuring Expenses for such
period.
Items (b), (c), (d), and (e) above should be calculated excluding
any extraordinary and/or non-recurring gains or losses which have been
included in the calculation of Consolidated Net Income. Such items may
include, but are not limited to, any write down or impairment of assets
of any Person and its subsidiaries.
"Effective Date" means the date on which all conditions precedent
set forth in Section 6.1 are satisfied or waived by all Lenders (or, in
the case of Section 6.1(d), waived by any Person entitled to receive
such payment).
"Eligible Assignee" means (a) a financial institution organized
under the laws of the United States, or any state thereof, and having a
combined capital and surplus of at least $100,000,000; (b) a commercial
bank organized under the laws of any other country which is a member of
the Organization for Economic Cooperation and Development, or a
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political subdivision of any such country, and having a combined
capital and surplus of at least $100,000,000, provided that such
Lender is acting through a branch or agency located in the United
States; (c) a Person that is primarily engaged in the business of
commercial banking and that is (i) a Subsidiary of a Lender, (ii) a
Subsidiary of a Person of which a Lender is a Subsidiary, or (iii) a
Person of which a Lender is a Subsidiary; (d) another Lender; (e) any
other entity which is an "accredited investor" (as defined in
Regulation D under the Securities Act of 1933, as amended) which
extends credit or buys loans as one of its businesses, including but
not limited to, insurance companies, mutual funds and lease financing
companies; or (f) other lenders or institutional investors consented
to in writing in advance by the Majority Lenders. Neither the Borrower
nor any Subsidiary of the Borrower shall be an Eligible Assignee.
"Environmental Laws" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to
public health and safety and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, together
with the regulations thereunder, in each case as in effect from time to
time. References to sections of ERISA also refer to any successor
sections.
"Eurocurrency Reserve Percentage" means, for any day during any
Interest Period, the reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day,
whether or not applicable to any Lender, under regulations issued from
time to time by the Board of Governors of the Federal Reserve System
for determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) with
respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"). The Offshore Rate for each outstanding Offshore Rate
Loan shall be adjusted automatically as of the effective date of any
change in the Eurocurrency Reserve Percentage.
"Event of Default" means any of the events described in Section
9.1.
"Event of Loss" means, with respect to any property, any of the
following: (a) any loss, destruction or damage of such property; (b)
any pending or threatened institution of any proceedings for the
condemnation or seizure of such property or for the exercise of any
right of eminent domain; or (c) any actual condemnation, seizure or
taking, by exercise of the power of eminent domain or otherwise, of
such property, or confiscation of such property or the requisition of
the use of such property.
"Excess Cash Flow" means, for any Fiscal Year (commencing on or
after September 1, 2002), Consolidated Net Income plus depreciation and
amortization, minus capital expenditures (excluding the financed
portion thereof (including with proceeds of equity, debt, asset sales
or insurance)), plus other non-cash charges (including with respect to
taxes) and Interest Expense to the extent deducted in determining
Consolidated
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Net Income plus decreases or minus increases in Working Capital minus
Interest Expense paid in cash for such period, minus scheduled
principal payments paid in respect of Debt.
"Excluded Subsidiaries" means the Subsidiaries listed on Schedule
4.3.
"Exit Facility Credit Documents" means the Post-Petition Credit
Agreement, including all related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith,
and in each case as amended, modified, renewed, refunded, replaced or
refinanced from time to time (in whole or in part) including, without
limitation any and all agreements (whether pursuant to one or more
agreements) extending the maturity of, refinancing, replacing or
otherwise restructuring (but excluding any increase in the amount of
available borrowings thereunder except as permitted under Section
8.22(e)) all or any portion of the obligations under such agreements or
any successor or replacement agreement or agreements and whether by the
same and/or other agent, lender or group of lenders.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of New
York (including any such successor, "H.15(519)") on the preceding
Business Day opposite the caption "Federal Funds (Effective)"; or, if
for any relevant day such rate is not so published on any such
preceding Business Day, the rate for such day will be the arithmetic
mean as determined by the Administrative Agent of the rates for the
last transaction in overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the
Administrative Agent.
"Fiscal Quarter" means any fiscal quarter of a Fiscal Year.
"Fiscal Year" means the fiscal year of the Borrower and its
Subsidiaries, which period shall be the 12-month period ending on
August 31 of each year.
"Fixed Charge Coverage Ratio" means for any period, for the
Borrower and its Subsidiaries on a consolidated basis, the ratio of:
(a) EBITDA minus the aggregate amount of all expenditures of the
Borrower and its Subsidiaries for fixed or capital assets made during
such period which, in accordance with GAAP, would be classified as
capital expenditures minus payments on Capitalized Leases to (b)
Interest Expense plus scheduled principal payments on Debt.
"Foreign Guarantor" means each Foreign Subsidiary of the Borrower
listed on Schedule 1.3 as updated from time to time.
"Foreign Subsidiary" means any Subsidiary that is not created or
organized in or under the law of the United States, any state thereof
or the Commonwealth of Puerto Rico.
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
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"Funded Debt" of any Person at any date of determination means
the sum of all Debt described in clauses (a), (b), and (i) of the
definition of "Debt".
"Further Taxes" means any and all present or future taxes,
levies, assessments, imposts, duties, deductions, fees, withholdings or
similar charges (including, without limitation, net income taxes and
franchise taxes), and all liabilities with respect thereto, imposed by
any jurisdiction on account of Taxes or Other Taxes payable or paid
pursuant to Section 5.2.
"FX Trading Office" means Cayman USD Funding No. 5761 of Bank of
America, or such other of Bank of America's offices as Bank of America
may designate from time to time.
"GAAP" means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which except as provided in Section 1.3 are applicable to
the circumstances as of the date of determination.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guarantor" means (a) each Subsidiary of the Borrower listed on
Schedule 1.3 and (b) each other Person who executes or reaffirms a
Guaranty on or after the Effective Date.
"Guaranty" means any guaranty delivered in connection with this
Agreement by (a) a Foreign Guarantor in a form as shall be satisfactory
to the Agent or (b) the U.S. Guarantors substantially the forms
delivered in connection with the Pre-Petition Credit Agreements.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act;
(c) any crude oil, petroleum product or fraction thereof
(excluding gasoline and oil in motor vehicles, small amounts of
cleaners and similar items used in the ordinary course of business); or
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(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any Environmental
Law.
"Impermissible Change in Control" means at any time, any Person
or group of Persons acting in concert (other than the existing
equityholders on the Effective Date), which are unacceptable to the
Majority Lenders, have obtained control of more than 20% of the issued
and outstanding shares of voting stock of the Borrower.
"Indemnified Liabilities" has the meaning specified in Section
11.5.
"Indemnified Person" has the meaning specified in Section 11.5.
"Instrument" means any contract, agreement, letter of credit,
indenture, mortgage, document or writing (whether by formal agreement,
letter or otherwise) under which any obligation is evidenced, assumed
or undertaken, or any Lien (or right or interest therein) is granted or
perfected.
"Intercreditor Agreement" shall mean that Intercreditor
Agreement, dated as of even date herewith in substantially the form of
Exhibit E.
"Interest Deferral" has the meaning specified in Section 3.4.
"Interest Expense" means, for any period, the consolidated
interest expense of the Borrower and its Subsidiaries for such period,
as determined in accordance with GAAP and in any event including,
without duplication, interest on the Loan Notes paid by the Borrower or
any of its Subsidiaries, all commissions, discounts and other fees and
charges owed with respect to letters of credit and banker's
acceptances, net costs under interest rate protection agreements, the
portion of any Capital Leases allocable to consolidated interest
expense and losses and discounts attributable to the sale of
receivables and related assets, but excluding, to the extent included
therein, non-cash amortization expenses.
"Interest Payment Date" means, as to any Base Rate Loan, the last
Business Day of each calendar quarter and, as to any Offshore Rate
Loan, the last day of any Interest Period; provided, however, that if
any Interest Period exceeds three months, the date that falls three
months after the beginning of such Interest Period is also an Interest
Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan, or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two,
three or six months thereafter as selected by the Borrower in its
Notice of Conversion/Continuation, as the case may be; provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to
the following Business Day unless, in the case of an Offshore
Rate Loan, the result of such extension
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would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the
preceding Business Day;
(ii) any Interest Period pertaining to an Offshore Rate Loan
that begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such
Interest Period;
(iii) no Interest Period for any Loan shall extend beyond a
Principal Repayment Date, unless there are Base Rate Loans or
other Offshore Rate Loans with Interest Periods ending prior to
such Principal Repayment Date in amounts at least equal to the
amount of the payment scheduled on such Principal Repayment Date;
and
(iv) no Interest Period for any Loan shall extend beyond the
Termination Date.
"Investment" means, with respect to any Person: (a) any loan
or advance made by such Person to any other Person; and (b) any capital
contribution made by such Person to, or ownership or similar interest
held by such Person in, any other Person. The amount of any Investment
shall be the original principal or capital amount thereof less all
returns of principal or equity thereon (and without adjustment by
reason of the financial condition of such other Person) and shall, if
made by the transfer or exchange of property other than cash, be deemed
to have been made in an original principal or capital amount equal to
the fair market value of such property.
"Investment Property" means all of the Borrower's or a
Collateral Guarantor's right, title and interest in and to any and all:
(a) securities whether certificated or uncertificated; (b) securities
entitlements; (c) securities accounts; (d) commodity contracts; or (e)
commodity accounts.
"Lending Office" means, as to any Lender, the office or offices
of such Lender specified as its "Lending Office" or "Domestic Lending
Office" or "Offshore Lending Office", as the case may be, on Schedule
11.2, or such other office or offices as such Lender may from time to
time notify the Borrower and the Administrative Agent.
"Leverage Ratio" means on any date, for the Borrower and its
Subsidiaries on a consolidated basis the ratio of (a) Total Debt on
such date to (b) EBITDA for the twelve month period then ending.
"Lien" means, when used with respect to any Person, any interest
of any other Person in any real or personal property, asset or other
right owned or being purchased or acquired by such Person which secures
payment or performance of any obligation and shall include any
mortgage, lien, encumbrance, charge or other security interest of any
kind, whether arising by contract, as a matter of law, by judicial
process or otherwise.
12
"Loan" means a Loan deemed made by a Lender to the Borrower under
Section 2.1. A Loan may be a Base Rate Loan or an Offshore Rate Loan
(each a "Type" of Loan).
"Loan Documents" means this Agreement, any Notes, any Guaranty,
the Collateral Documents and all other documents delivered to the
Administrative Agent or any Lender in connection herewith including any
related fee letters.
"Loan Notes" means (a) Deed Constituting Floating Rate Unsecured
Loan Notes 2008, dated June 19, 1998, as amended, by Applied Power
Limited and National Westminster Bank PLC, (b) Deed Constituting
Floating Rate Unsecured Loan Notes 2003, dated October 13, 1998, as
amended, by APW Enclosure Systems Limited and National Westminister
Bank PLC, (c) Counter-Indemnity Agreement, dated on or about May 25,
2001, by and among APW and National Westminster Bank PLC, (d) the
Payment Agreement dated June 28, 2002 with National Westminister Bank,
PLC and (e) all notes, guaranties, pledges, and other agreements and
documents given or issued pursuant thereto or in connection therewith.
"Loan Party" means the Borrower and each Guarantor.
"Majority Lenders" means Lenders having an aggregate Pro Rata
Share of the Loans in excess of 50%.
"Margin Stock" means any "margin stock" as defined in Regulation
U of the Board of Governors of the Federal Reserve System.
"Material Adverse Effect" means, other than arising in connection
with the Chapter 11 Cases or as indicated in writing to the Lenders
prior to the date hereof, a material adverse effect on (a) the
financial condition, operations, business, assets or prospects of the
Borrower and its Subsidiaries taken as a whole, or (b) the ability of
the Borrower or any Guarantor to timely and fully perform any of its
payment or other material obligations under this Agreement, any Note or
any other Loan Document, or (c) the perfection or priority of the Liens
granted pursuant to the Collateral Documents, subject to the
Intercreditor Agreement.
"Minimum Amount" means, in respect of Loans comprising part of
the same Borrowing, or to be converted or continued under Section 2.4,
the amount of $1,000,000 or any integral multiple thereof.
"Net Issuance Proceeds" means, as to any issuance of debt or
equity by any Person, cash proceeds and non-cash proceeds received or
receivable by such Person in connection therewith, net of reasonable
out-of-pocket costs and expenses paid or incurred in connection
therewith in favor of any Person not an Affiliate of such Person, such
costs and expenses not to exceed 10% of the gross proceeds of such
issuance.
"Net Proceeds" means, (a) as to any disposition, proceeds in
cash, checks or other cash equivalent financial instruments as and when
received by such Person, net of: (i) the direct costs relating to such
disposition, excluding amounts payable to such Person or any
13
Affiliate of such Person, (ii) an estimate of cash Taxes paid or
payable by such Person within nine months of the disposition as a
direct result thereof and (iii) amounts required to be applied to
repay principal, interest and prepayment premiums and penalties on
purchase money liens or other Prior Permitted Liens on the asset which
is the subject of such Disposition; or (b) any proceeds paid on
account of any Event of Loss, net of (i) all money actually applied to
repair or reconstruct the taking, (ii) all of the costs and expenses
reasonably incurred in connection with the collection of such
proceeds, award or other payments, and (iii) any amounts retained by
or paid to parties having superior rights to such proceeds, awards or
other payments.
"Non-Collateral Guarantor" means a Guarantor with respect to
which the Administrative Agent does not have a security interest
(second in priority only to Prior Permitted Liens and as set forth in
the Intercreditor Agreement) in substantially all its assets.
"Non-U.S. Security Documents" means the Debentures and Security
Documents listed in Schedule 1.4 hereto.
"Note" means a promissory note of the Borrower payable to a
Lender in substantially the form of Exhibit A.
"Notice of Assignment and Acceptance" means a Notice of
Assignment and Acceptance substantially in the form of Exhibit B.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit C.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, the Borrower or any Guarantor
arising under any Loan Document, whether direct or indirect (including
those acquired by assignment), absolute or contingent, due or to become
due, now existing or hereafter arising and including interest that
accrues after the commencement of any proceeding under any debtor
relief laws by or against the Borrower, any Guarantor or any Subsidiary
or Affiliate thereof.
"Offshore Base Rate" means, for such Interest Period:
(a) the rate per annum (carried out to the fifth decimal place)
equal to the rate determined by Administrative Agent to be the offered
rate that appears on the page of the Telerate Screen that displays an
average British Bankers Association Interest Settlement Rate for
deposits in Dollars (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period, determined as
of approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period, or
(b) in the event the rate referenced in the preceding subsection
(a) does not appear on such page or service or such page or service
shall cease to be available, the rate per annum (carried out to the
fifth decimal place) equal to the rate determined by Administrative
Agent to be the offered rate on such other page or other service that
displays an average British Bankers Association Interest Settlement
Rate for deposits in
14
Dollars (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
(c) in the event the rates referenced in the preceding
subsections (a) and (b) are not available, the rate per annum
determined by Administrative Agent as the rate of interest at which
deposits in Dollars (for delivery on the first day of such Interest
Period) in same day funds in the approximate amount of the applicable
Offshore Rate Loan and with a term equivalent to such Interest Period
would be offered by its London Branch to major Lenders in the offshore
Dollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period.
"Offshore Rate" means for any Interest Period with respect to any
Offshore Rate Loan, a rate per annum determined by Administrative Agent
pursuant to the following formula (the determination of the
Eurocurrency Reserve Percentage and the Offshore Base Rate by
Administrative Agent shall be conclusive in the absence of manifest
error):
Offshore Rate = Offshore Base Rate
---------------------------------------
1.00 - Eurocurrency Reserve Percentage
"Offshore Rate Loan" means a Loan that bears interest based on
the Offshore Rate.
"Organic Document" means, relative to the Borrower or each of the
Guarantors, its certificate of incorporation, its by-laws, any other
constituent documents and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its capital stock or other
constituent documents.
"Other Taxes" means any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery, performance, enforcement or registration of, or
otherwise with respect to, this Agreement or any other Loan Documents.
"Outstanding Obligations" means, as of any date, and giving
effect to making any Loans and all payments, repayments and prepayments
made on such date, (a) when reference is made to all Lenders, the sum
of the aggregate outstanding principal amount of all Loans, and (b)
when reference is made to one Lender the sum of the aggregate
outstanding principal amount of all Loans made by such Lender.
"Participant" has the meaning specified in Section 11.8(d).
"PBGC" means the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to title IV of ERISA (other
than a multiemployer plan as defined
15
in section 4001(a)(3) of ERISA), and to which the Borrower or any
corporation, trade or business that is, along with the Borrower, a
member of a Controlled Group may have any liability, including any
liability by reason of having been a substantial employer within the
meaning of section 4063 of ERISA at any time during the preceding five
years, or by reason of being deemed to be a contributing sponsor under
section 4069 of ERISA.
"Permitted Liens" means:
(a) Liens for taxes or other governmental charges not at the time
delinquent or thereafter payable without penalty or being contested in
good faith by appropriate proceedings and, in each case, for which it
maintains adequate reserves;
(b) Liens arising in the ordinary course of business (such as (i)
Liens of carriers, warehousemen, mechanics and materialmen and other
similar Liens imposed by law and (ii) Liens incurred in connection with
worker's compensation, unemployment compensation and other types of
social security (excluding Liens arising under ERISA) or in connection
with surety and appeal bonds, bids, performance bonds and similar
obligations) for sums not overdue or being contested in good faith by
appropriate proceedings and not involving any deposits or advances or
borrowed money or the deferred purchase price of property or services,
and, in each case, for which it maintains adequate reserves;
(c) attachments, judgments and other similar Liens, for sums not
exceeding $2,000,000, arising in connection with court proceedings,
provided the execution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are being actively
contested in good faith and by appropriate proceedings;
(d) other Liens incidental to the conduct of the business of the
Borrower or a Subsidiary or the ownership of its property or assets,
including easements, rights of way, restrictions, minor defects or
irregularities in title and other similar Liens, which Liens were not
incurred in connection with the borrowing of money and do not, in any
case or in the aggregate, interfere in any material respect with the
ordinary conduct of the business of the Borrower or any Subsidiary;
(e) building restrictions, zoning laws and other statutes, laws,
rules, regulations, ordinances and restrictions, and any amendments
thereto, now or at any time hereafter adopted by any governmental
authority having jurisdiction; cash collateral pursuant to the Loan
Documents;
(f) Liens in favor of the Administrative Agent, any Collateral
Agent and the Lenders securing the obligations under the Loan
Documents;
(g) Prior Permitted Liens and Liens in favor of the Post-Petition
Agent and the Post-Petition Lenders securing the Post-Petition
Obligations;
(h) Liens granted to RBS and National Westminister Bank PLC
providing cash collateral in respect of foreign exchange facilities,
the provision of which is permitted by
16
this Agreement, provided that the maximum amount of cash collateral
outstanding at any time pursuant to this clause (i) shall not exceed
$1,000,000; and
(i) other Liens securing obligations permitted under Section
8.22(d) or Section 8.22(e).
"Person" means any natural person, corporation, partnership,
trust, limited liability company, incorporated or unincorporated
association, joint venture, joint stock company, government (or an
agency or political subdivision thereof) or other entity, whether
acting in an individual, fiduciary or other capacity.
"Plan" has the meaning specified in the recitals.
"Pledge Agreement" means that certain Amended and Restated Pledge
Agreement, dated as of May 16, 2002, among the Borrower, certain
Subsidiaries of the Borrower and the Post-Petition Agent, as amended or
modified from time to time.
"Post-Petition Agent" means Bank of America in its capacity as
Post-Petition Agent for the Lenders under the Post-Petition Credit
Agreement, any successor Post-Petition Agent and any other agent under
an Exit Facility Document.
"Post-Petition Credit Agreement" means the Post-Petition
Multicurrency Superpriority Credit Agreement dated as of May 16, 2002,
among the Borrower, the Financial Institutions Party Thereto, Bank of
America, N.A., as Post-Petition Agent and U.S. Collateral Agent, Royal
Bank of Scotland, plc, as Lead Arranger, Book Manager and U.K.
Collateral Agent and Oaktree Capital Management, LLC, as Lead Arranger
and Book Manager as such Agreement may be amended, modified,
supplemented, amended and restated, replaced or refinanced from time to
time so long as no such amendment, modification, supplement, amendment
and restatement, replacement or refinancing shall increase the
principal amount thereof except as permitted under Section 8.22(e).
"Post-Petition Obligations" means all advances to, and debts,
liabilities, obligations, covenants and duties of, the Borrower or any
Guarantor arising under the Exit Facility Credit Documents and any
document related thereto, whether direct or indirect (including those
acquired by assignment), absolute or continent, due or to become due,
now existing or hereafter arising and including interest that accrues
after the commencement of any proceeding under any debtor relief laws
by or against the Borrower, any Guarantor or any Subsidiary or
Affiliate thereof.
"Pounds Sterling" means lawful money of the United Kingdom.
"Pre-Petition Credit Agreement" has the meaning specified in the
recitals.
"Pre-Petition Obligations" means all obligations of the Borrower
under the Pre-Petition Credit Agreements.
"Pre-Petition U.K. Obligations" means all obligations of the
Borrower under the U.K. Pre-Petition Credit Agreements.
17
"Pre-Petition U.S. Obligations" means all obligations of the
Borrower under the U.S. Pre-Petition Credit Agreement.
"Principal Prepayment Date" has the meaning specified in Section
3.1.
"Prior Permitted Liens" means any and all valid, perfected
pre-Commencement Date Liens in existence as of the Commencement Date.
"Pro Rata Share" means, as to any Lender, at any time, the
percentage equivalent (expressed as a decimal, rounded to the ninth
decimal place) at such time of such Lender's Loans divided by the
combined Loans of all the Lenders).
"Proprietary Rights" means all of the Borrower's and its
Subsidiaries' now owned and hereafter arising or acquired: licenses,
franchises, permits, patents, patent rights, copyrights, works which
are the subject matter of copyrights, trademarks, service marks, trade
names, trade styles, patent, trademark and service mark applications,
and all licenses and rights related to any of the foregoing, including
those patents, trademarks, service marks, trade names and copyrights
set forth in the schedules to the Security Agreement, and all other
rights under any of the foregoing, all extensions, renewals, reissues,
divisions, continuations, and continuations-in-part of any of the
foregoing, and all rights to sue for past, present and future
infringement of any of the foregoing.
"RBS" means The Royal Bank of Scotland PLC.
"Release" means a "release", as such term is defined in CERCLA.
"Reorganization Items" means non-recurring expenses (including
professional fees) incurred in connection with the Chapter 11 Cases.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an
arbitrator or of a Governmental Authority, in each case applicable to
or binding upon the Person or any of its property or to which the
Person or any of its property is subject.
"Resource Conservation and Recovery Act" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, et seq., as in
effect from time to time.
"Restructuring Expenses" means GAAP and non GAAP restructuring
expenses incurred by the Borrower and its Subsidiaries during any
specified period.
"Same Day Funds" means immediately available funds.
"SEC" means the Securities and Exchange Commission.
"Security Agreement" means that certain Amended and Restated
Security Agreement, dated as of May 16, 2002 among the Borrower,
certain Subsidiaries of the Borrower and Bank of America, National
Association in its capacity as Administrative
18
Agent under the Pre-Petition Credit Agreement and as Post-Petition
Agent, as amended or modified from time to time.
"Security Documents" means the Security Agreement, the
Debentures, the Non-U.S. Security Documents and the Amendment and
Confirmation.
"Shared Collateral" shall have the meaning set forth in the
Intercreditor Agreement.
"Spot Rate" for a currency means the rate quoted by Bank of
America as the spot rate for the purchase by Bank of America of such
currency with another currency through its FX Trading Office at
approximately 11:00 a.m. (New York time) on the date two Business Days
prior to the date as of which the foreign exchange computation is made.
"Subsidiary" means, with respect to any Person, any corporation,
association, partnership, limited liability company or other business
entity of which such Person and/or its other Subsidiaries own, directly
or indirectly, more than 50% of the voting stock, membership interests
or other equity interests. Unless the context otherwise requires, each
reference to Subsidiaries herein shall be a reference to Subsidiaries
of the Borrower.
"Supermajority Lenders" means Lenders having an aggregate Pro
Rata Share of the Loans in excess of 85%.
"Suretyship Liability" means any agreement, undertaking or other
contractual arrangement by which any Person guarantees, endorses or
otherwise becomes or is contingently liable upon (by direct or indirect
agreement, contingent or otherwise, to provide funds for payment, to
supply funds to or otherwise to invest in a debtor, or otherwise to
assure a creditor against loss) any indebtedness, obligation or other
liability (including accounts payable) of any other Person (other than
by endorsements of instruments in the course of collection), or
guarantees the payment of dividends or other distributions upon the
shares of any other Person. The amount of any Person's obligation under
any Suretyship Liability shall (subject to any limitation set forth
therein) be deemed to be the principal amount of the indebtedness,
obligation or other liability guaranteed thereby.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity
index swap or option, bond, note or bill option, interest rate option,
forward foreign exchange transaction, cap, collar or floor transaction,
currency swap, cross-currency rate swap, swaption, currency option or
any other, similar transaction (including any option to enter into any
of the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the
case of each Lender and the Administrative Agent, respectively,
19
taxes imposed on or measured by its net income by the jurisdiction (or
any political subdivision thereof) under the laws of which such Lender
or the Administrative Agent, as the case may be, is organized or
maintains a lending office.
"Termination Date" means July 31, 2007.
"Tier-One Collateral Guarantor" means a Collateral Guarantor
organized in, and with all its assets located in, the United States,
England, Scotland or Ireland.
"Tier-Two Collateral Guarantor" means a Collateral Guarantor,
other than a Tier-One Collateral Guarantor.
"Total Debt" means at any particular time, all outstanding Debt
(including contingent obligations with respect to Debt of other
Persons) of the Borrower and its Subsidiaries on a consolidated basis.
"Two Thirds Lenders" means Lenders having an aggregate Pro Rata
Share of the Loans at least of 66 2/3%
"Type" has the meaning specified in the definition of "Loan".
"U.K. Collateral Agent" means RBS, in its capacity as U.K.
collateral agent under the Security Documents.
"U.K. Pre-Petition Credit Agreements" has its meaning specified
in the recitals.
"United States" or "U.S." means the United States of America, its
50 States, the District of Columbia and the Commonwealth of Puerto
Rico.
"U.S. Collateral Agent" means Bank of America in its capacity as
U.S. collateral agent under the Security Documents.
"U.S. Pre-Petition Credit Agreement" has the meaning specified in
the recitals.
"Valencia Lease" means Lease Agreement, dated as of September 15,
1998, between Assex XV Holdings Company, L.L.C. as Lessor, and Zero
Corporation n/k/a APW North America, Inc. as Lessee, as amended,
together with the Ground Lease, the Participation Agreement, the Loan
Agreement and the other Operative Documents, as amended (all as defined
in the Lease Agreement), relating to a synthetic lease of land and
improvements located at 28545 Livingston Avenue West, Valencia,
California
"Welfare Plan" means a "welfare plan", as such term is defined in
section 3(1) of ERISA.
"Working Capital" means consolidated current assets of the
Borrower and its Subsidiaries (excluding cash and Cash Equivalents)
minus consolidated current liabilities of the Borrower and its
Subsidiaries (excluding the current portion of any long term Debt
including loans under Exit Facility Credit Documents).
20
1.2 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision
of this Agreement; and Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means
"including without limitation."
(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means
"from and including"; the words "to" and "until" each mean "to
but excluding", and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and
(ii) references to any statute or regulation are to be construed as
including all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation
of this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are
cumulative and shall each be performed in accordance with their terms.
Unless otherwise expressly provided, any reference to any action of the
Administrative Agent or the Lenders by way of consent, approval or
waiver shall be deemed modified by the phrase "in its/their sole
discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the
Administrative Agent, the Borrower and the other parties, and are the
products of all parties. Accordingly, they shall not be construed
against the Lenders or the Administrative Agent merely because of the
Administrative Agent's or Lenders' involvement in their preparation.
1.3 Accounting Principles. References to financial statements include
notes thereto in accordance with GAAP; and accounting terms used but not defined
herein shall be construed in accordance with GAAP, and whenever the character or
amount of any asset or liability or item of income or expense is required to be
determined, or any consolidation or other accounting
21
computation is required to be made, for purposes hereof, such determination or
computation shall be made in accordance with GAAP; provided that such
determinations and computations with respect to financial covenants and ratios
hereunder shall be made in accordance with GAAP as in effect on the date hereof.
ARTICLE II
LOANS
2.1 Amounts of Loans. In partial exchange for the Pre-Petition U.S.
Obligations, each Lender shall be deemed to have made a Base Rate Loan in the
amount set forth in Schedule 2.1 hereto. Upon the effectiveness hereof, the
Pre-Petition U.K. Obligations shall be cancelled and the interests of the
Lenders thereunder shall be refinanced by the interests of such Lenders under
this Agreement. No additional loans shall be made under this Agreement, except
as provided in Section 3.4(c). The Loans shall be in Dollars.
2.2 Loan Accounts.
(a) The Loans made by each Lender shall be evidenced by one or
more loan accounts or records maintained by such Lender in the ordinary
course of business. The loan accounts or records or schedules, as the
case may be, maintained by the Administrative Agent and each Lender
shall be rebuttable presumptive evidence of the amount of the Loans
made by the Lenders to the Borrower and the interest and payments
thereon. Any failure so to record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower
hereunder to pay any amount owing with respect to the Loans.
(b) Upon the request of any Lender made through the
Administrative Agent, the Loans made by such Lender may be evidenced by
one or more Notes. Each such Lender may also endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made
by it and the amount of each payment of principal made by the Borrower
with respect thereto. Each such Lender is irrevocably authorized by the
Borrower to endorse its Note(s) and each Lender's record shall be
rebuttable presumptive evidence; provided, however, that the failure of
a Lender to make, or an error in making, a notation thereon with
respect to any Loan shall not limit or otherwise affect the obligations
of the Borrower hereunder or under any such Note to such Lender.
2.3 Procedure for Borrowing. The Loans shall be deemed made as Base
Rate Loans upon the entering of the Confirmation Order. No amount of any Loan,
which is repaid, may be reborrowed.
2.4 Conversion and Continuation Elections for Borrowing.
(a) The Borrower may, upon irrevocable written notice to the
Administrative Agent in accordance with Section 2.4(b):
22
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period,
in the case of Offshore Rate Loans, to convert any such Loans (or
any part thereof in an amount not less than the Minimum Amount)
into Loans of any other Type; or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any Loans having Interest Periods expiring on
such day (or any part thereof in an amount not less than the
Minimum Amount).
(b) The Borrower shall deliver a Notice of
Conversion/Continuation to be received by the Administrative Agent not
later than 8:30 a.m. (New York time) at least three Business Days in
advance of the Conversion/Continuation Date, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
continued;
(C) the Type of Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into Base
Rate Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Borrower has failed to select timely a new
Interest Period to be applicable to such Offshore Rate Loans, or if any
Default or Event of Default then exists, the Borrower shall be deemed
to have elected to convert such Offshore Rate Loans into Base Rate
Loans. If the Borrower has elected to continue its Offshore Rate Loans
or convert its Base Rate into Offshore Rate Loans in accordance with
the terms hereof but has failed to select a new Interest Period to be
applicable to Offshore Rate Loans prior to the third Business Day in
advance of the expiration date of the current Interest Period
applicable thereto, the Borrower shall be deemed to have elected a one
month Interest Period effective as of the expiration date of such
Interest Period.
(d) The Administrative Agent will promptly notify each Lender of
its receipt of a Notice of Conversion/Continuation, or, if no timely
notice is provided by the Borrower, the Administrative Agent will
promptly notify each Lender of the details of any automatic conversion.
All conversions and continuations shall be made ratably according to
the respective outstanding principal amounts of the Loans with respect
to which the notice was given.
(e) Unless the Majority Lenders otherwise agree, during the
existence of a Default or Event of Default, the Borrower may not elect
to have a Loan converted into or continued as an Offshore Rate Loan.
23
(f) After giving effect to any conversion or continuation of
Loans, there may not be more than six different Interest Periods in
effect in respect of all Loans together then outstanding.
ARTICLE III
PREPAYMENTS; PAYMENTS
3.1 Scheduled Prepayments. The Borrower shall repay the principal
amount of the Loans in the principal amounts on the following dates:
Date Amounts
------ ---------
October 31, 2004 $2,500,000
January 31, 2005 $2,500,000
April 30, 2005 $2,500,000
July 31, 2005 $2,500,000
October 31, 2005 $5,000,000
January 31, 2006 $5,000,000
April 30, 2006 $5,000,000
July 31, 2006 $5,000,000
October 31, 2006 $5,000,000
January 31, 2007 $5,000,000
April 30, 2007 $5,000,000
$55,000,000, plus all additional
July 31, 2007 principal pursuant to Section 3.4(c)
All outstanding Loans, including accrued interest and fees, shall be
repaid on July 31, 2007. All prepayments under Sections 3.2 and 3.3 shall be
applied to the above listed installments of Loans in inverse order of their
maturities. All prepayments, whether voluntary or mandatory, shall be subject to
Section 5.5.
3.2 Mandatory Prepayments. The following prepayments of Loans shall be
required; provided, that to the extent the Exit Facility Credit Documents
requires prepayments on the following events (and such prepayments are, in fact
made), the following prepayments of the Loans in this Section shall not be
required and provided, further, if after the prepayments under the Exit Facility
Credit Documents required upon any of the following events, the cash and Cash
24
Equivalents held by the Borrower and its Subsidiaries exceed $10,000,000, such
excess shall be applied to prepay the outstanding Loans.
(a) Net Proceeds of Disposition of Assets. Upon the disposition
of any assets (including any receipt of insurance proceeds upon an
Event of Loss, except to the extent reinvested within six months) of
the Borrower or any of its Subsidiaries, except sales of inventory in
the ordinary course of business, and dispositions less than $1,000,000
per disposition, but subject to a $5,000,000 aggregate limit during
the term of this Agreement, the Loans shall be prepaid by an aggregate
amount equal to 100% of the Net Proceeds raised by such disposition.
If the actual cash Taxes on any disposition paid within nine months of
receipt of Net Proceeds are less than the estimated tax component of
Net Proceeds, the Loans shall be prepaid by the excess of the
estimated tax component less the actual Taxes.
(b) Issuance of Equity. Immediately upon the issuance of equity
in the Borrower or any of its Subsidiaries other than with respect to
warrants and options (and any capital stock issued upon the exercise
of warrants or options) issued to the existing equity owners of Oldco
or Lenders under the Exit Facility Credit Documents, the Loans shall
be ratably reduced by an amount equal to the Net Issuance Proceeds
received in cash or Cash Equivalents.
(c) Excess Cash Flow. Upon the earlier of (x) the date on which
annual audited statements are required to be delivered pursuant to
Section 11.1(a) hereof (whether or not so delivered) and (y) the
delivery of the annual audit financial statements for each fiscal year
of the Borrower, the Loans shall be prepaid by the amount equal to 50%
of the Excess Cash Flow for such fiscal year. Each prepayment
hereunder shall be accompanied by a certificate signed by Borrower's
Chief Financial Officer certifying the manner in which Excess Cash
Flow was calculated, which certificate shall be in form and substance
reasonably satisfactory to the Majority Lenders. (For the avoidance of
doubt, the prepayment under this Section 3.2(c), giving effect to the
second proviso of Section 3.2, plus the prepayment out of Excess Cash
Flow made under the Exit Facility Credit Documents shall equal 50% of
Excess Cash Flow for the applicable fiscal year).
3.3 Optional Prepayments. The Borrower may, at any time or from time to
time, by giving the Administrative Agent irrevocable notice not later than (i)
8:30 a.m. (New York time) on the date of the proposed prepayment, in the case of
Base Rate Loans and (ii) 8:30 a.m. (New York time) three Business Days prior to
the proposed payment date, in the case of Offshore Rate Loans, ratably prepay
Loans in whole or in part, in amounts equal to the Minimum Amount. Such notice
of prepayment shall specify the date and amount of such prepayment and the
Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify
each Lender of its receipt of any such notice, and of such Lender's share of
such prepayment. If such notice is given by the Borrower, the Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein, together with accrued interest to
each such date on the amount prepaid and any amounts required pursuant to
Section 5.5. The Administrative Agent, in all instances, shall be entitled to
rely on such notice.
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3.4 Interest.
(a) Each Loan shall bear interest on the outstanding principal
amount thereof from the applicable Borrowing Date at a rate per annum
equal to the Offshore Rate or the Base Rate, as the case may be, plus the
Applicable Margin (and subject to the Borrower's right to convert to
other Types of Loans under Section 2.4).
(b) Subject to the following clause (c), interest on each Loan
shall be paid in arrears on each Interest Payment Date. Interest shall
also be paid on the date of any prepayment of Offshore Rate Loans for the
portion of the Loans so prepaid and upon payment (including prepayment)
in full thereof and, during the existence of any Event of Default,
interest shall be paid on demand of the Administrative Agent at the
request or with the consent of the Majority Lenders.
(c) The Borrower shall have the option, so long as no Event of
Default (it being understood that the deferral of an Interest Payment as
permitted under this Section 3.4(c) shall not constitute such an Event of
Default) has occurred and is continuing, to defer interest payments for
up to two fiscal quarters; provided, that, (i) the fiscal quarters shall
not be consecutive, (ii) the Borrower shall give notice to the
Administrative Agent prior to fifteen days before the end of the
applicable fiscal quarter, and (iii) interest during such fiscal quarter
shall accrue at the rate otherwise applicable plus 2% and shall be added
as additional principal to the Loans at the end of such fiscal quarter,
bearing interest payable as set forth for Loans under this Agreement and
with such additional principal being payable on the Termination Date.
(Any deferral of interest shall be called on "Interest Deferral").
Interest may not be deferred for any fiscal quarter ending after August
31, 2004 or for any fiscal quarter commencing after the first consecutive
six month period for which the Leverage Ratio was 3.5 to 1.0 or less.
(d) After maturity of any Loan (whether by acceleration or
otherwise) or upon the occurrence of any Event of Default (upon the
election of Majority Lenders), such Loan shall bear interest on the
unpaid principal amount thereof at a rate per annum equal to (i) for any
Base Rate Loan the sum of two percent (2%) plus the Base Rate plus the
Applicable Margin from time to time in effect; and (ii) for any Offshore
Rate Loan, the sum of three percent (3%) plus the rate of interest in
effect thereon at the time of such maturity until the end of the Interest
Period applicable thereto and, thereafter, at a rate per annum equal to
the sum of two percent (2%) plus the Base Rate plus the Applicable Margin
from time to time in effect.
3.5 Fees.
The Borrower shall pay the administrative fees, which fees shall include
the fees payable to the Collateral Agents pursuant to the Administrative Fee
Letter or any fee letters issued by the Collateral Agents.
Each of the fees and charges set forth in this Section 3.5 are
non-refundable.
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3.6 Computation of Fees and Interest.
All computations of interest, when calculated at the "prime rate", shall
be made on the basis of a 365/6 day year and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more interest being paid than if
computed on the basis of a 365-day year).
3.7 Payments by the Borrower.
(a) All payments to be made by the Borrower shall be made without
set-off, deduction, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Borrower shall be made in
Dollars to the Administrative Agent for the account of the Lenders at the
Administrative Agent's Payment Office. Such payments shall be made in
Same Day Funds, no later than 12:00 p.m. (New York time) on the date
specified herein. The Administrative Agent will promptly distribute to
each Lender its Pro Rata Share of such principal, interest, fees or other
amounts, in like funds as received. Any payment which is received by the
Administrative Agent later than 12:00 p.m. (New York time) shall be
deemed to have been received on the following Business Day and any
applicable interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than
a Business Day, such payment shall be made on the following Business Day,
and such extension of time shall in such case be included in the
computation of interest or fees, as the case may be.
(c) Unless the Administrative Agent receives notice from the
Borrower prior to the date on which any payment is due to the Lenders
that the Borrower will not make such payment in full as and when
required, the Administrative Agent may assume that the Borrower has made
such payment in full to the Administrative Agent on such date in
immediately available funds and the Administrative Agent may (but shall
not be so required), in reliance upon such assumption, distribute to each
Lender on such due date an amount equal to the amount then due such
Lender. If and to the extent the Borrower has not made such payment in
full to the Administrative Agent, each Lender shall repay to the
Administrative Agent on demand such amount distributed to such Lender,
together with interest thereon at the Federal Funds Rate for each day
from the date such amount is distributed to such Lender until the date
repaid.
3.8 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its applicable Pro Rata Share, such Lender shall
immediately (a) notify the Administrative Agent of such fact, and (b) purchase
from the other Lenders such participations in the Loans made by them as shall be
necessary to cause such purchasing Lender to share the excess payment pro rata
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Lender, such purchase shall
to that extent be rescinded and each other Lender shall repay to the purchasing
Lender the purchase price paid therefor, together with an amount equal to such
paying Lender's ratable share (according to the proportion of (i) the
27
amount of such paying Lender's required repayment to (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off, but subject to Section 11.10) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation. The Administrative
Agent will keep records (which shall be conclusive and binding in the absence of
manifest error) of participations purchased under this Section and will in each
case notify the Lenders following any such purchases or repayments.
ARTICLE IV
GUARANTIES AND COLLATERAL
4.1 Security Interests; Collateral. As security for the full and timely
payment and performance of all obligations of the Borrower hereunder and under
the other Loan Documents, now existing or hereafter arising, the Borrower and
each of its Subsidiaries (which is a Collateral Guarantor) have granted to the
Collateral Agents for the benefit of the Administrative Agent, the Collateral
Agents, and the Lenders a valid, binding, enforceable, duly perfected security
interest in the Collateral (second in priority only to Prior Permitted Liens and
as set forth in the Intercreditor Agreement).
4.2 Guaranties.
(a) Obligations of the Borrower. All obligations of the Borrower
shall be guaranteed by the Guarantors.
(b) Required Guaranties. All Domestic Subsidiaries of the
Borrower shall be required to be Guarantors. The Foreign Guarantors
listed on the attached Schedule 1.3 shall be required to be Guarantors.
Subject to Section 4.2(c), the Borrower shall, at the request of the
Administrative Agent or the Majority Lenders, cause each of its
Subsidiaries required to guarantee its Obligations pursuant to this
Section 4.2, to execute and deliver such guaranties and deliver such
evidence of authority, correctness of signatures and opinions of counsel
as the Administrative Agent or the Majority Lenders may from time to time
reasonably request. The Administrative Agent is authorized to release,
and shall release, without any further request for approval from the
Lender, any Guaranty of a Dissolution Subsidiary, upon the Borrower's
request, immediately prior to or any time after the commencement of a
members voluntary liquidation of such Dissolution Subsidiary or the
filing of an application to the U.K. Registrar of Companies to strike off
the relevant Dissolution Subsidiary, provided that such Dissolution
Subsidiary shall not have assets in excess of 50,000 Pounds Sterling at
the time thereof (exclusive of intragroup claims).
(c) Action with Non-Guarantors.
(i) Subject to clause (vi) below, neither the Borrower nor
any Collateral Guarantor shall purchase or acquire, or make any
commitment therefor,
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any capital stock, equity interest or other securities of, or any
interest in, any existing Affiliate (other than a Tier-One
Collateral Guarantor), or make or commit further to make any
capital contribution to, or any investment in, any existing
Affiliate (other than a Tier-One Collateral Guarantor).
(ii) Subject to clause (vi) below, neither the Borrower nor
any Guarantor shall make any loan, advance or extension of credit
to any Affiliate (other than the Borrower or a Tier One
Affiliate, it being understood that a payment or distribution is
made indirectly to the Borrower or a Tier-One Collateral
Guarantor if all the proceeds thereof are in fact received by the
Borrower or a Tier-One Collateral Guarantor).
(iii) Subject to clause (vi) below, neither the Borrower nor
any Guarantor shall transfer or sell any assets to any Affiliate
(other than payments under the Exit Facility Credit Documents and
payments hereunder and under the Loan Documents) if the effect of
such a transfer or sale would reduce the amount of (or impair the
security interest of the Agents) in the Collateral.
(iv) Subject to clause (vi) below, no Guarantor shall
declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on
account of any shares of any class of its capital stock, or
purchase, redeem, or otherwise acquire for value any shares of
its capital stock or any warrants, rights or options to acquire
such shares, now or hereafter outstanding, unless all such
payments or distributions are made directly or indirectly to the
Borrower or a Tier-One Collateral Guarantor (it being understood
that a payment or distribution is made indirectly to the Borrower
or Tier-One Collateral Guarantor if all the proceeds thereof are
in fact received by the Borrower or a Tier-One Collateral
Guarantor); provided, that such payments and distributions may
also be made by a Non-Collateral Guarantor directly or indirectly
to a Non-Collateral Guarantor or a Tier-Two Collateral Guarantor
directly or indirectly to a Tier-Two Collateral Guarantor.
(v) Subject to clause (vi) below, neither the Borrower nor
any Collateral Guarantor shall make any payments on Debt to any
Affiliate other than payments to the Borrower or a Tier-One
Collateral Guarantor and payments under the Exit Facility Credit
Documents and payments hereunder and under the Loan Documents.
(vi) Notwithstanding the foregoing, the Borrower and the
Guarantors may (A) make loans under clauses (i)-(v) to any
Affiliate, (B) make capital contributions under clauses (i)-(v)
to any Affiliate, but only to the extent required to comply with
minimum equity maintenance or debt/equity ratio (or similar)
requirements applicable to such Affiliate, and/or (C) transfer
assets under clauses (i)-(v) to any Affiliate, but only to the
extent that such assets are obsolete or no longer required in the
operation of the business of the applicable transferor as
confirmed by the board of directors (or equivalent governing
body) of such transferor, and provided that the aggregate amount
of loans, capital contributions
29
and value of assets transferred pursuant to this clause (vi)
shall not exceed $5,000,000 at any one time outstanding.
4.3 Collateral Documents. Concurrently with or prior to the Effective
Date, the Borrower shall execute and deliver and cause each of its Subsidiaries,
(other than the Excluded Subsidiaries) to execute and deliver to the
Administrative Agent, for the benefit of the Lenders, Amendment and
Confirmation.
4.4 Further Assurances. If any Guaranty is limited in amount and if the
applicable Guarantor would be legally permitted to deliver a Guaranty in a
greater amount (or in an unlimited amount), at the request of the Administrative
Agent (as directed in writing by the Majority Lenders), it will deliver a
replacement Guaranty, evidences of authority, evidences of correctness of
signatures and opinions of counsel reasonably satisfactory to the Majority
Lenders. The Borrower agrees that, upon request of the Administrative Agent (as
directed in writing by the Majority Lenders), the Borrower shall promptly
deliver or cause to be delivered to the Administrative Agent (as Collateral
Agent) or to the other Collateral Agent (as appropriate), in due form for
transfer, all chattel paper, instruments, securities and documents of title, if
any, at any time representing all or any of the Collateral. The Borrower agrees
that, upon request of the Administrative Agent (as directed in writing by the
Majority Lenders), the Borrower shall forthwith execute and deliver or cause to
be executed and delivered to the Administrative Agent (as Collateral Agent), in
due form for filing or recording (and pay the cost of filing or recording the
same in all public offices deemed necessary by the Administrative Agent), such
further assignment agreements, security agreements, pledge agreements,
instruments, consents, waivers, financing statements, stock or bond powers,
searches, releases, and other documents, and do such other acts and things, all
as the Administrative Agent (as directed in writing by the Majority Lenders) may
from time to time reasonably requests (a) to ensure that (i) the obligations of
the Borrower hereunder and under the other Loan Documents are secured by
substantially all assets of the Borrower and guaranteed by all Subsidiaries
(including, promptly upon the acquisition or creation thereof, any Subsidiary
created or acquired after the date hereof but excluding the Excluded
Subsidiaries) and (ii) the obligations of the Borrower under the Loan Documents
are secured by substantially all of the assets of each Subsidiary other than the
Excluded Subsidiaries, (b) to perfect and maintain the validity, effectiveness
and priority of the Liens intended to be created under the Intercreditor
Agreement and the Security Documents and (c) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Administrative Agent and
the Lenders the rights granted or now or hereafter intended to be granted to the
Administrative Agent and the Lenders under any Loan Document or under any other
document executed in connection therewith. The Borrower agrees that, upon entry
of the Confirmation Order, no further actions or filings are required to create
or perfect the Liens of the Administrative Agent for the benefit of the Lenders
other than the appropriate delivery, filing and/or recordation of the Collateral
Documents and the Intercreditor Agreement. If at any time a Subsidiary required
to be a Guarantor shall not be a Guarantor or any Guarantor shall not have
delivered the Collateral Documents required hereunder or any of the
circumstances described in Section 9.1 below shall have arisen, such Subsidiary
shall take all action reasonably required by the Administrative Agent to become
a Guarantor and to provide Collateral.
4.5 Transfer of Assets. The Borrower shall not, and shall not permit, any
Subsidiary, to sell, lease or transfer assets in which the Administrative Agent
or any Collateral Agent has a
30
perfected security interest to the Borrower, a Subsidiary or an Affiliate, if
the effect is to cause the Administrative Agent or any Collateral Agent to no
longer have a valid perfected security interest (second in priority only to
Prior Permitted Liens and as set forth in the Intercreditor Agreement), except
as otherwise permitted by Section 4.2(c).
4.6 Collateral Matters.
(a) A Collateral Agent is authorized (but not obligated) on
behalf of all the Lenders, without the necessity of any notice to or
further consent from the Lenders, from time to time to take any action
with respect to any Collateral or the Collateral Documents which, in its
sole judgment, may be necessary or otherwise advisable to perfect and
maintain perfected the security interest in and Liens upon the Collateral
granted pursuant to the Collateral Documents.
(b) The Lenders irrevocably authorize the pertinent Collateral
Agent, at its option and in its discretion, to release any Lien granted
to or held by such Collateral Agent upon any Collateral (i) constituting
property sold or to be sold or disposed of as part of or in connection
with any disposition permitted hereunder; (ii) constituting property in
which the Borrower or any Subsidiary owned no interest at the time the
Lien was granted or at any time thereafter; (iii) constituting property
leased to the Borrower or any Subsidiary under a lease which has expired
or been terminated in a transaction permitted under this Agreement; (iv)
consisting of an instrument evidencing Indebtedness or other debt
instrument, if the indebtedness evidenced thereby has been paid in full;
or (v) if approved, authorized or ratified in writing by the Majority
Lenders. Upon request by the Administrative Agent at any time, the
Majority Lenders will confirm in writing a Collateral Agent's authority
to release particular types or items of Collateral pursuant to this
subsection 4.6(b), provided that the absence of any such confirmation for
whatever reason shall not affect a Collateral Agent's rights under this
Section 4.6.
ARTICLE V
PRIORITY OF PAYMENTS, TAXES, YIELD PROTECTION AND ILLEGALITY
5.1 Apportionment, Application and Reversal of Payments. Principal and
interest payments shall be apportioned among the Lenders Pro Rata. All payments
shall be remitted to the Administrative Agent. All proceeds of Collateral
received by the Administrative Agent shall be applied by the Administrative
Agent in the following order after receipt thereof:
First, to pay any fees, indemnities or expense
reimbursements then due to the Administrative Agent or the
Collateral Agents from the Borrower under this Agreement and the
Loan Documents, including but not limited to, any such fees,
indemnities or expense reimbursements incurred (a) in connection
with the administration, sale or disposition of any Collateral,
and (b) the administration and enforcement of this Agreement and
the other Loan Documents, to the extent that such costs and
expenses shall not have been reimbursed to the Administrative
Agent or the Collateral Agents and relate to the Obligations;
31
Second, to pay any fees, indemnities or expense
reimbursements then due to the Lenders from the Borrower;
Third, to pay interest;
Fourth, to pay or prepay principal of Loans;
Fifth, to the payment of any other Obligation of any Lender
by the Borrower; and
Sixth, to the Borrower.
Notwithstanding anything to the contrary contained in this Agreement, unless so
directed by the Borrower, or unless an Event of Default has occurred and is
continuing, neither the Administrative Agent nor any Lender shall apply any
payments which it receives to any Offshore Rate Loan, except (a) on the
expiration date of the Interest Period applicable to any such Offshore Rate
Loan, or (b) in the event, and only to the extent, that there are no outstanding
Base Rate Loans and, in any event, the Borrower shall pay Offshore Rate breakage
losses in accordance with Section 5.5. In the absence of a direction by the
Borrower with respect to an application, or upon the occurrence of any Event of
Default, the Administrative Agent and the Lenders (per the written direction of
Majority Lenders) shall have the continuing and exclusive right to apply and
reverse and reapply any and all such proceeds and payments to any portion of the
Obligations. Notwithstanding any provision of this Agreement to the contrary,
the Administrative Agent, in all instances, shall be entitled to rely on the
direction of the Borrower or the Majority Lenders (as the case may be) with
respect to the application of any such proceeds.
5.2 Taxes.
(a) Any and all payments by the Borrower to each Lender or the
Administrative Agent under this Agreement and any other Loan Document
shall be made free and clear of, and without deduction or withholding
for, any Taxes. In addition, the Borrower shall pay all Other Taxes and
Further Taxes.
(b) If the Borrower shall be required by law to deduct or
withhold any Taxes, Other Taxes or Further Taxes from or in respect of
any sum payable hereunder to any Lender or the Administrative Agent,
then:
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section) such Lender or the Administrative Agent, as
the case may be, receives and retains an amount equal to the sum
it would have received and retained had no such deductions or
withholdings been made;
(ii) the Borrower shall make such deductions and
withholdings;
32
(iii) the Borrower shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Borrower shall also pay to each Lender or the
Administrative Agent for the account of such Lender, at the time
interest is paid, Further Taxes in an amount that the respective
Lender specifies as necessary to preserve the after-tax yield the
Lender would have received if such Taxes, Other Taxes or Further
Taxes had not been imposed.
(c) The Borrower agrees to indemnify and hold harmless each Lender
and the Administrative Agent for the full amount of (i) Taxes, (ii) Other
Taxes, and (iii) Further Taxes in the amount that the respective Lender
reasonably specifies as necessary to preserve the after-tax yield such
Lender would have received if such Taxes, Other Taxes or Further Taxes
had not been imposed, and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes, Other Taxes or Further Taxes were correctly or
legally asserted. Payment under this indemnification shall be made within
30 days after the date a Lender or the Administrative Agent makes written
demand therefor.
(d) Within 30 days after the date of any payment by the Borrower of
Taxes, Other Taxes or Further Taxes, the Borrower shall furnish to each
Lender or the Administrative Agent the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment
satisfactory to such Lender or the Administrative Agent.
(e) If the Borrower is required to pay additional amounts to any
Lender or the Administrative Agent pursuant to Section 5.2(b) or (c) then
such Lender shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its Lending Office
so as to eliminate any such additional payment by the Borrower which may
thereafter accrue, if such change in the sole judgment of such Lender is
not otherwise disadvantageous to such Lender.
5.3 Illegality.
(a) If any Lender determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for any Lender or its applicable Lending
Office to make Offshore Rate Loans (including Offshore Rate Loans in any
Applicable Currency), then, on notice thereof by the Lender to the
Borrower through the Administrative Agent, any obligation of that Lender
to make Offshore Rate Loans shall be suspended until the Lender notifies
the Administrative Agent and the Borrower that the circumstances giving
rise to such determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
Offshore Rate Loan, the Borrower shall, upon its receipt of notice of
such fact and demand from such Lender (with a copy to the Administrative
Agent), prepay in full such Offshore Rate Loans of that Lender then
outstanding, together with interest accrued thereon and amounts required
33
under Section 5.5, either on the last day of the Interest Period thereof,
if the Lender may lawfully continue to maintain such Offshore Rate Loans
to such day, or immediately, if the Lender may not lawfully continue to
maintain such Offshore Rate Loan. If the Borrower is required to so
prepay any Offshore Rate Loan, then concurrently with such prepayment,
the Borrower shall borrow from the affected Lender, in the Dollar
Equivalent amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Borrower may elect,
by giving notice to the Lender through the Administrative Agent that all
Loans which would otherwise be made by the Lender as Offshore Rate Loans
shall be instead Base Rate Loans.
(d) Before giving any notice to the Administrative Agent under
this Section, the affected Lender shall designate a different Lending
Office with respect to its Offshore Rate Loans if such designation will
avoid the need for giving such notice or making such demand and will not,
in the judgment of the Lender, be illegal or otherwise disadvantageous to
the Lender.
5.4 Increased Costs and Reduction of Return.
(a) If any Lender determines that, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation after the date hereof or (ii) the compliance by that Lender
with any guideline or request from any central bank or other Governmental
Authority after the date hereof (whether or not having the force of law),
there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining any Offshore Rate Loans, then the
Borrower shall be liable for, and shall from time to time, within 10 days
after demand (with a copy of such demand to be sent to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender,
additional amounts as are sufficient to compensate such Lender for such
increased costs.
(b) If any Lender shall have determined that (i) the introduction
after the date hereof of any Capital Adequacy Regulation, (ii) any change
after the date hereof in any Capital Adequacy Regulation, (iii) any
change after the Effective Date in the interpretation or administration
of any Capital Adequacy Regulation by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or (iv) compliance by such Lender (or its Lending Office) or any
corporation controlling the Lender with any Capital Adequacy Regulation
adopted after the Effective Date, affects or would affect the amount of
capital required or expected to be maintained by such Lender or any
corporation controlling such Lender and (taking into consideration such
Lender's or such corporation's policies with respect to capital adequacy
and such Lender's desired return on capital) determines that the amount
of such capital is increased as a consequence of its loans, credits or
obligations under this Agreement, then, upon demand of such Lender to the
Borrower through the Administrative Agent, the Borrower shall pay to the
Lender, from time to time as specified by the Lender, additional amounts
sufficient to compensate the Lender for such increase.
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5.5 Funding Losses. The Borrower shall reimburse each Lender and hold
each Lender harmless from any loss or expense which the Lender may sustain or
incur as a consequence of:
(a) the failure of the Borrower to make on a timely basis any
payment of principal of any Offshore Rate Loan;
(b) the failure of the Borrower to continue or convert a Loan after
the Borrower has given a Notice of Conversion/Continuation;
(c) the failure of the Borrower to make any prepayment of any Loan
in accordance with any notice delivered under Section 3.2;
(d) the prepayment (including pursuant to Sections 3.2 or 3.3) or
other payment (including after acceleration thereof) of any Offshore Rate
Loan on a day that is not the last day of the relevant Interest Period;
or
(e) the automatic conversion of any Offshore Rate Loan to a Base
Rate Loan on a day that is not the last day of the relevant Interest
Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained.
5.6 Inability to Determine Rates. If the Majority Lenders determine that
for any reason adequate and reasonable means do not exist for determining the
Offshore Rate for any requested Interest Period with respect to a proposed
Offshore Rate Loan, or that the Offshore Rate for any requested Interest Period
with respect to a proposed Offshore Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Administrative Agent
will promptly so notify the Borrower and each Lender. Thereafter, the obligation
of the Lenders to make or maintain Offshore Rate Loans hereunder shall be
suspended until the Administrative Agent upon the instruction of the Majority
Lenders revokes such notice in writing. Upon receipt of such notice, the
Borrower may revoke any Notice of Conversion/Continuation then submitted by it.
If the Borrower does not revoke such Notice, the Lenders shall make, convert or
continue the Loans, as proposed by the Borrower, in the amount specified in the
applicable notice submitted by the Borrower, but such Loans shall be made,
converted or continued as Base Rate Loans instead of Offshore Rate Loans.
5.7 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article V shall deliver to the Borrower (with a copy to
the Administrative Agent) a certificate setting forth in reasonable detail the
amount payable to such Lender hereunder and such certificate shall be conclusive
and binding on the Borrower in the absence of manifest error. In determining the
amount payable to the Lender pursuant to this Article V, each Lender shall act
reasonably and in good faith and will, to the extent the increased costs or
reductions in amounts received or receivable relate to such Lender's loans in
general (including the Loans) and are not specifically attributable to the Loans
and other amounts due hereunder, use averaging and attribution methods which are
reasonable and which cover all loans similar to the Loans made by such Lender.
35
5.8 Substitution of Lenders. Upon the receipt by the Borrower from any
Lender (an "Affected Lender") of a claim for compensation under Section 5.2, 5.3
or 5.4, the Borrower may: (i) request the Affected Lender to cooperate with the
Borrower in its efforts to obtain a replacement lender or financial institution
satisfactory to the Borrower to acquire and assume all or a ratable part of all
of such Affected Lender's Loans (a "Replacement Lender"); (ii) request one more
of the other Lenders to acquire and assume all or part of such Affected Lender's
Loans; or (iii) designate a Replacement Lender. Any such designation of a
Replacement Lender under clause (i) or (iii) shall be subject to the prior
written consent of the Administrative Agent (which consent shall not be
unreasonably withheld).
5.9 Survival. The agreements and obligations of the Borrower in this
Article V shall survive the payment of all other Obligations.
ARTICLE VI
CONDITIONS PRECEDENT
6.1 Conditions Precedent. This amendment and restatement shall become
effective on the date (the "Effective Date"), which date shall occur on or
before August 9, 2002, on which each of the following conditions precedent are
satisfied:
(a) Confirmation Order. The Administrative Agent shall have
received a copy certified by the Secretary of the Borrower of the
Confirmation Order entered by the Bankruptcy Court, which shall not have
been vacated, stayed, revised, modified or amended.
(b) Documents. The Administrative Agent shall have received all of
the following, each duly executed (or duly agreed where provided) and
dated the Effective Date (or such earlier date as shall be satisfactory
to the Administrative Agent and each Lender), in form and substance
satisfactory to the Majority Lenders, and each in sufficient number of
signed counterparts to provide one for each Lender:
(i) Term Loan Agreement. This Agreement executed by the
Borrower, the Administrative Agent and the Lenders.
(ii) Amendment and Confirmation. The Amendment and
Confirmation executed by the Borrower and its Subsidiaries (other
than the Excluded Subsidiaries).
(iii) Intercreditor Agreement. The Intercreditor Agreement,
which provides among other things, for the Obligations hereunder to
be secured by a security interest in the Collateral (second in
priority only to Prior Permitted Liens and as set forth in the
Intercreditor Agreement).
(iv) Organizational Documents and Resolutions of Borrower.
Certified copies of organizational documents of the Borrower and
resolutions of the Board of Directors of the Borrower authorizing
or ratifying the execution, delivery and
36
performance by the Borrower of this Agreement and the other documents
provided for in this Agreement to be executed by the Borrower.
(v) Incumbency and Signatures of Borrower. A certificate of the
Secretary, an Assistant Secretary or a comparable officer of the Borrower
certifying the names of the officer, officers or other authorized
representatives of the Borrower authorized to sign this Agreement and the
other documents provided for in this Agreement to be executed by the
Borrower, together with a sample of the true signature of each such
officer or authorized representative (it being understood that the
Administrative Agent and each Lender may conclusively rely on such
certificate until formally advised by a like certificate of any changes
therein).
(vi) Resolutions of Guarantors. With respect to the Guarantors,
certified copies of resolutions of the Board of Directors of each
Guarantor authorizing or ratifying the execution, delivery and
performance by such Guarantor of its Guaranty and the other documents
provided for in this Agreement to be executed by such Guarantor.
(vii) Incumbency and Signatures of Guarantors. With respect to
Guarantors, a certificate of the Secretary, an Assistant Secretary or a
comparable officer of each Guarantor certifying the names of the officer,
officers or other authorized representatives of such Guarantor authorized
to sign the documents provided for in this Agreement to be executed by
such Guarantor, together with a sample of the true signature of each such
officer or authorized representative (it being understood that the
Administrative Agent and each Lender may conclusively rely on such
certificate until formally advised by a like certificate of any changes
therein).
(viii) Opinions of Counsel for the Borrower and the Guarantors. The
opinions of counsel to the Borrower and the Guarantors in the forms of
Exhibit F and Exhibit G.
(ix) Insurance Certificate. A certificate of insurance of the
Borrower listing all insurance policies, or certificates of the Borrower
and its Subsidiaries including naming the Collateral Agent as loss payees
and all Lenders as additional insureds, in form and substance
satisfactory to the Majority Lenders.
(x) Exit Facility. A copy of the Exit Facility Credit Agreement
duly executed by the parties thereto.
(xi) Compliance Certificate. A Compliance Certificate of the
Borrower evidencing the Borrower is in compliance with the provisions of
this Agreement and certifying that no Material Adverse Effect has
occurred since August 31, 2001, other than as disclosed in writing to the
Lenders prior to the date hereof and with respect to the Chapter 11
Cases.
37
(xii) Other Documents. Such other approvals, opinions,
documents or materials as the Administrative Agent or any Lender
may request.
(c) Consents, etc. Certified copies of all documents evidencing any
necessary corporate action, consents and governmental approvals (if any)
required for the execution, delivery and performance of the Loan
Documents by the Borrower.
(d) Payment of Fees. Evidence of payment by the Borrower of all
amounts due under the Administrative Fee Letter.
(e) Other. Such other documents as the Administrative Agent or any
Lender may reasonably request.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Agreement, the Borrower
represents and warrants to the Administrative Agent and the Lenders as follows:
7.1 Organization, Etc. Each of the Borrower and its Subsidiaries is a
corporation, limited liability company or limited partnership duly organized,
validly existing and in good standing (or similar concept under applicable law)
under the laws of the jurisdiction of its organization. Each of the Borrower and
each of its Subsidiaries is duly qualified to do business, and is in good
standing, in all other jurisdictions where failure to so qualify would have a
Material Adverse Effect. Each of the Borrower and each of its Subsidiaries has
all requisite corporate power, limited liability company power or limited
partnership power, as applicable, to own or lease the properties used in its
business and to carry on its business as now being conducted. Each of the
Borrower and each of its Subsidiaries has full power and authority to conduct
its business as proposed to be conducted, and to execute and deliver the Loan
Documents to which it is a party and to engage in the transactions contemplated
thereby.
7.2 Authorization; No Conflict. Upon entry of the Confirmation Order by
the Bankruptcy Court the execution and delivery of this Agreement, the
borrowings and incurrence of the other Obligations hereunder, the execution and
delivery of the other Loan Documents, and the performance by each Loan Party of
its obligations under each Loan Document to which it is a party (including the
granting of Liens to the Administrative Agent for the benefit of the Lenders)
are within each of the Loan Party's powers, have been duly authorized by all
necessary action, have received all necessary governmental and regulatory
approval, and do not and will not contravene or conflict with, or result in the
creation or imposition of a lien under, any provision of law or of the charter
or by-laws or similar documents of such Loan Party or of any agreement,
instrument, order or decree that is binding upon such Loan Party.
7.3 Validity and Binding Nature. Upon entry of the Confirmation Order by
the Bankruptcy Court each Loan Document to which it is a party constitutes the
legal, valid, and binding obligations of each Loan Party enforceable against
such Loan Party in accordance with its respective terms, except to the extent
enforceability thereof is limited by bankruptcy,
38
insolvency or other laws relating to, or affecting the enforcement of,
creditors' rights in general, and by general principles of equity.
7.4 Financial Statements.
(a) All balance sheets, all statements of earnings, stockholders'
equity and cash flow, and all other financial information which have been
furnished by or on behalf of Oldco to the Lender, including (i) the
audited consolidated balance sheet at August 31, 2001 and the related
audited consolidated statements of earnings, stockholders' equity and
cash flow, for the Fiscal Year then ended, of Oldco and its Subsidiaries,
certified by PriceWaterhouse Coopers and (ii) the unaudited consolidated
balance sheet dated May 31, 2002 and the related unaudited consolidated
statements of earnings and cash flow, for the Fiscal Quarter then ended,
of Oldco and its Subsidiaries, as appearing in the report on Form 10-Q
for such Fiscal Quarter filed by Oldco with the U.S. Securities and
Exchange Commission, have been prepared in accordance with GAAP
consistently applied, except where not applicable thereto or as otherwise
disclosed therein, throughout the periods involved and present fairly
(subject to normal year-end adjustments, if applicable) the financial
condition of Oldco and its Subsidiaries as at the dates thereof and the
results of their operations for the periods then ended. Oldco and its
Subsidiaries did not have as of such dates any material contingent
liability or liabilities for taxes, long-term leases or unusual forward
or long-term commitments which are not reflected in the financial
statements described above, and which, in accordance with GAAP, should
have been reflected in such financial statements.
(b) With respect to any representation and warranty which is deemed
to be made after the date hereof by the Borrower, the balance sheet and
statements of earnings, shareholders' equity and cash flow, which as of
such date shall most recently have been furnished by or on behalf of the
Borrower to the Lenders for the purposes of or in connection with this
Agreement shall have been prepared in accordance with GAAP consistently
applied (except as disclosed therein), and shall present fairly the
consolidated financial condition of the corporations covered thereby as
at the dates thereof for the periods then ended, subject, in the case of
quarterly financial statements, to normal year-end audit adjustments.
7.5 No Material Adverse Effect. Other than arising as a result of the
commencement of the Chapter 11 Cases and as indicated in writing to the Lenders
prior to the date hereof, since August 31, 2001, there has been no event or
occurrence that has had or is reasonably likely to have a Material Adverse
Effect.
7.6 Litigation and Contingent Liabilities. Other than the Chapter 11
Cases, to the best of the Borrower's knowledge, no litigation (including,
without limitation, derivative actions), arbitration proceedings or governmental
or regulatory proceedings are pending or threatened against the Borrower or any
Subsidiary of the Borrower that would, if adversely determined, be reasonably
likely to have a Material Adverse Effect, except as set forth in Item 7.6 of the
Disclosure Schedule. Other than any liability incident to such litigation or
proceedings, neither the Borrower nor any Subsidiary has any contingent
liabilities, except as provided for or
39
disclosed in the financial statements referred to in Section 7.4, which would if
adversely determined be reasonably likely to have a Material Adverse Effect.
7.7 Liens. None of the assets of the Borrower or any of its Subsidiaries
is subject to any Lien, except Permitted Liens.
7.8 Subsidiaries. Item 7.8 of the Disclosure Schedule correctly sets
forth the name, jurisdiction of organization, and ownership of each Subsidiary
of the Borrower. Such Subsidiaries and each Person becoming a Subsidiary of the
Borrower after the date hereof is and will be a corporation, limited liability
company or limited partnership duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and each Subsidiary
of the Borrower is and will be duly qualified to do business in each other
jurisdiction where failure to so qualify would have a Material Adverse Effect.
The Subsidiaries located in England, Scotland and Ireland, which are not
delivering Non-US Security Documents, are dormant and such Subsidiaries as a
whole do not have assets aggregating in excess of 500,000 Pounds Sterling.
7.9 Pension and Welfare Plans. During the twelve-consecutive-month period
prior to the date of the execution and delivery of this Agreement or the making
of any Loan hereunder, no steps have been taken to terminate any Pension Plan,
and no contribution failure has occurred with respect to any Pension Plan
sufficient to give rise to a lien under Section 302(f) of ERISA. No condition
exists or event or transaction has occurred with respect to any Pension Plan
which could result in the incurrence by the Borrower or any of it Subsidiaries
of any material liability, fine or penalty. Except as set forth in the pension
and welfare plan footnote in the audited financial statements referred to in
Section 7.4, neither the Borrower nor any of the Subsidiaries have any
contingent liability with respect to any post-retirement benefit under a Welfare
Plan, other than liability for continuation coverage described in Part 6 of
subtitle B of title I of ERISA.
7.10 Regulated Industry. Neither the Borrower nor any of its Subsidiaries
is (a) an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended,
or (b) 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.
7.11 Regulations T, U and X. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock, and no proceeds of any Loan will be used for the purpose, whether
immediate, incidental or ultimate, of purchasing or carrying any Margin Stock or
maintaining or extending credit to others for such purpose except as permitted
under Section 7.10. The Borrower and its Subsidiaries do not hold Margin Stock
having a value in excess of 25% of the assets of the Borrower and its
Subsidiaries taken as a whole.
7.12 Taxes. Each of the Borrower and its Subsidiaries, has filed all
federal and all other material tax returns and reports required by law to have
been filed by it and has paid all taxes and governmental charges thereby shown
to be owing, except any such taxes or charges
40
which are being diligently contested in good faith by appropriate proceedings
and for which adequate reserves shall have been set aside on its books.
7.13 Environmental and Safety Matters. None of the matters disclosed on
Item 7.13 of the Disclosure Schedule has had or is reasonably likely to have a
Material Adverse Effect. Except as disclosed in Item 7.13 of the Disclosure
Schedule:
(a) The Borrower and each of its Subsidiaries is in substantial
compliance with all federal, state and local laws, ordinances and
regulations relating to safety and industrial hygiene or to environmental
condition, including, without limitation, all Environmental Laws in
jurisdictions in which the Borrower or any Subsidiary owns or operates,
or has owned or operated, a facility or site, or arranges or has arranged
for disposal or treatment of Hazardous Material, accepts or has accepted
for transport any Hazardous Material or holds or has held any interest in
real property or otherwise.
(b) No demand, claim, notice, suit, suit in equity, action,
administrative action, investigation or inquiry, whether brought by any
governmental authority, private person or entity or otherwise, arising
under, relating to or in connection with any Environmental Laws is
pending or, to the best of the Borrower's knowledge, after due
investigation, threatened against the Borrower or any of its
Subsidiaries, any real property in which the Borrower or any such
Subsidiary holds or has held an interest or any past or present operation
of the Borrower or any Subsidiary.
(c) Neither the Borrower nor any of its Subsidiaries
(i) is, to the best of the Borrower's knowledge, after
due investigation, the subject of any federal or state
investigation evaluating whether any remedial action is needed to
respond to a Release of any Hazardous Material into the
environment,
(ii) has received any notice of any Hazardous Material
in or upon any of its properties in violation of any Environmental
Laws, or
(iii) knows of any basis for any such investigation,
notice or violation.
(d) No Release, threatened Release or disposal of Hazardous
Material is occurring or has occurred on, under or to any real property
in which the Borrower or any of its Subsidiaries holds any interest or
performs any of its operations in violation of any Environmental Law.
7.14 Compliance with Law. Except as disclosed in Item 7.14 of the
Disclosure Schedule, each of the Borrower and each of its Subsidiaries is in
compliance with all statutes, judicial and administrative orders, permits and
governmental rules and regulations which are material to its business or the
non-compliance with which has had or is reasonably likely to have a Material
Adverse Effect.
7.15 Information. All information heretofore or contemporaneously
herewith furnished by the Borrower or any of its Subsidiaries to any Lender for
purposes of or in
41
connection with this Agreement and the transactions contemplated hereby is, and
all information hereafter furnished by or on behalf of the Borrower or any of
its Subsidiaries to any Lender pursuant hereto or in connection herewith will
be, true and accurate in every material respect on the date as of which such
information is dated or certified, and such information, taken as a whole, does
not and will not omit to state any material fact necessary to make such
information, taken as a whole, not misleading.
7.16 Ownership of Properties. Item 7.16 of the Disclosure Schedule
correctly sets forth for all real property held by the Borrower and its
Subsidiaries the location and owner. Each of the Borrower and each of its
Subsidiaries owns good and marketable title to or holds valid leasehold
interests in all of its material properties and assets, real and personal, of
any nature whatsoever, free and clear of all Liens except Permitted Liens and
except as set forth in Item 7.16 of the Disclosure Schedule; none of the
Borrower or any of its Subsidiaries are in default beyond the expiration of any
applicable grace period of any material obligation under any leases creating any
of their leasehold interests in real property, and none of such property is
subject to any Lien except Permitted Liens.
7.17 Patents, Trademarks, Etc. Each of the Borrower and each of its
Subsidiaries owns or licenses and possesses all such patents, patent rights,
trademarks, trademark rights, trade names, trade name rights, service marks,
service mark rights and copyrights as the Borrower considers necessary for the
conduct of the businesses of the Borrower and such Subsidiaries as now conducted
without, individually or in the aggregate, any infringement upon rights of other
persons which would be reasonably likely to have a Material Adverse Effect.
7.18 Insurance. The Borrower and each of its Subsidiaries maintain with
responsible insurance companies insurance (including insurance against claims
and liabilities arising out of the manufacture or distribution of any products)
with respect to their properties and businesses against such casualties and
contingencies and of such types and in such amounts as is customary in the case
of similar businesses, except as disclosed in Item 7.18 of the Disclosure
Schedule.
7.19 Intercompany Debt. All Debt of the Borrower or any Subsidiary to
the Borrower or any Subsidiary is subordinated to the Obligations pursuant to a
subordination agreement in substantially the form attached as Exhibit O.
7.20 Secured Obligations.
(a) On and after the Effective Date, the provisions of the Loan
Documents and the Collateral Documents and the Confirmation Order are
effective to create in favor of the Administrative Agent and the
Collateral Agent, for the benefit of the Lenders, legal, valid and
perfected Liens on and security interests (having the priority provided
for herein, in the Confirmation Order and in the Intercreditor Agreement)
in all right, title and interest in the Collateral expressed to be
secured by the Collateral Documents, enforceable against each Loan Party
that owns an interest in such Collateral.
(b) The Intercreditor Agreement is in full force and effect and
have not been vacated, reversed, modified, amended or stayed without the
prior written consent of the Majority Lenders.
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7.21 Investment Business. Neither the Borrower nor any of its
Subsidiaries carries on, or will carry on, any activities, other than
performance of the Obligations, which would constitute the carrying on of
investment business in or from within Bermuda.
ARTICLE VIII
COVENANTS
Until all obligations of the Borrower hereunder are paid in full, the
Borrower agrees that, unless at any time the Majority Lenders shall otherwise
expressly consent in writing, it will and will cause each of its Subsidiaries
to:
8.1 Reports, Certificates and Other Information. Furnish to the
Administrative Agent and each Lender:
(a) Audit Report. Promptly when available and in any event within
90 days after the close of each Fiscal Year:
(i) a copy of the annual audit report of the Borrower
and its Subsidiaries for such Fiscal Year, including therein
consolidated balance sheet of the Borrower and its Subsidiaries
as of the end of such Fiscal Year and consolidated statements of
earnings and cash flow of the Borrower and its Subsidiaries for
such Fiscal Year certified, without qualification as to going
concern or scope, by independent auditors of recognized national
standing selected by the Borrower and reasonably acceptable to
the Majority Lenders, and
(ii) consolidating balance sheets of the Borrower and
its Subsidiaries as of the end of such Fiscal Year and a
consolidating statement of earning and statement of cash flows
for the Borrower and its Subsidiaries for such Fiscal Year,
certified by the Chief Financial Officer or Treasurer of the
Borrower.
(b) Interim Reports.
(i) Promptly when available and in any event within 45
days after the end of each Fiscal Quarter consolidated balance
sheets of the Borrower and its Subsidiaries as of the end of such
Fiscal Quarter, consolidated statements of earnings and a
consolidated statement of cash flow for such Fiscal Quarter and
for the period beginning with the first day of such Fiscal Year
and ending on the last day of such Fiscal Quarter of the Borrower
and its Subsidiaries, with comparable information at the close of
and for the corresponding portion of such prior Fiscal Year,
together with a certificate of the Chief Financial Officer or the
Treasurer of the Borrower to the effect that such financial
statements fairly present the financial condition and results of
operations of the Borrower and its Subsidiaries of the date and
periods indicated (subject to normal year-end adjustments).
(ii) Promptly when available and in any event within 30
days after the end of each calendar month, consolidated balance
sheet of the Borrower and its
43
Subsidiaries as of the end of such month, consolidated statements of
earnings and a consolidated statement of cash flow for such month and
for the period beginning with the first day of such Fiscal Year and
ending on the last day of such month of the Borrower and its
Subsidiaries, together with a certificate of the chief financial
officer or the Treasurer of the Borrower to the effect that such
financial statements fairly represent the financial condition and
results of operations of the Borrower and its Subsidiaries as of the
date and periods indicated (subject to normal year-end adjustments).
(c) Compliance Certificate. Concurrently with each set of financial
statements delivered pursuant to Section 8.1(a) and 8.1(b), a Compliance
Certificate executed by the Chief Financial Officer or the Treasurer of the
Borrower, calculating compliance with Section 8.6(a).
(d) RESERVED.
(e) Comparison Reports. On or before the first Thursday that is on or
following the 15/th/ day of each month, the actual cash receipts and
disbursements for the previous month with a comparison report explaining
variances between projections and actual results.
(f) Forecast. Within 30 days after end of each fiscal quarter, a
consolidated income statement, balance sheet and cash flow forecast for the
following eight fiscal quarters on a quarter by quarter basis.
(g) Reports to SEC. Promptly upon the filing or sending thereof, a
copy of any annual, periodic or special report or registration statement
(inclusive of exhibits thereto) filed by the Borrower or any of its
Subsidiaries with the SEC or any securities exchange, and any press
releases or other statements concerning material changes or developments in
the business of the Borrower or any of its Subsidiaries.
(h) Notice of Default and Other Matters. Immediately upon becoming
aware of any of the following, written notice describing the same and the
steps being taken by the Borrower or any of its Subsidiaries affected
thereby with respect thereto: (i) the occurrence of an Event of Default or
a Default; (ii) any litigation, arbitration or governmental investigation
or proceeding not previously disclosed by the Borrower to the Lenders which
has been instituted or, to the knowledge of the Borrower, is threatened
against the Borrower or any of its Subsidiaries or to which any of the
properties of any thereof is subject which, if adversely determined, is
reasonably likely to have a Material Adverse Effect; (iii) the institution
of any steps by the Borrower, any of its Subsidiaries or any other Person
to terminate any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is sufficient to give rise
to a lien under Section 302(f) of ERISA, or the taking of any action with
respect to a Pension Plan which could result in the requirement that the
Borrower or any of its Subsidiaries furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event with respect to
any Pension Plan which could result in the incurrence by the Borrower of
any material liability, fine or penalty, or any material increase in the
contingent liability of the
44
Borrower with respect to any post-retirement Welfare Plan benefit; and
(iv) any other event or occurrence which has had or is reasonably likely
to have a Material Adverse Effect, including, without limitation, any
labor dispute or WARN Act or related liability.
(i) Subsidiaries. Promptly upon the formation of any subsidiary,
notice of such fact.
(j) Net Proceeds. Promptly upon receipt of any Net Proceeds or
Net Issuance Proceeds requiring a prepayment under Section 5.1, a
certificate of an Authorized Officer calculating such Net Proceeds or Net
Issuance Proceeds and the required prepayment, in such detail as
reasonably acceptable to the Administrative Agent.
(k) Other Information. From time to time such other information
concerning the Borrower and its Subsidiaries as any Lender, the
Administrative Agent or any representative thereof may reasonably
request.
8.2 Books, Records and Inspections. Keep, and cause each of its
Subsidiaries to keep, its books and records reflecting all of its business
affairs and transactions in accordance with sound business practices sufficient
to allow the preparation of financial statements in accordance with GAAP; and
permit, and cause each of its Subsidiaries to permit, any Lender or the
Administrative Agent or any representative thereof, at reasonable times and on
reasonable notice, to visit any or all of its offices, to discuss its financial
matters with its officers and the independent auditors (and the Borrower hereby
authorizes such independent auditor to discuss such financial matters with any
Lender or the Administrative Agent or any representative thereof), and to
examine (and, at the Borrower's or such Subsidiary's expense, make copies of)
any of its books or other corporate records.
8.3 Insurance. Maintain, and cause each of its Subsidiaries to maintain,
with responsible and financially-sound insurance companies or associations,
insurance in such amounts and covering such risks as is usually maintained by
companies engaged in similar businesses and owning similar properties similarly
situated; and deliver annually after the Effective Date to the Administrative
Agent a certificate as to such insurance.
8.4 Compliance with Law; Payment of Taxes and Liabilities. (a) Comply,
and cause each Subsidiary to comply, in all material respects with all
applicable laws, rules, regulations and orders (including the requirements
imposed in connection with the confirmation and consummation of the Plan); and
(b) pay, and cause each Subsidiary to pay, prior to delinquency, all taxes and
other governmental charges against it or any of its property arising after the
Commencement Date; provided, however, that the foregoing shall not require the
Borrower or any Subsidiary to pay or discharge any such tax, charge or claim so
long as it shall contest the validity thereof in good faith by appropriate
proceedings and shall set aside on its books adequate reserves with respect
thereto, no Lien shall be imposed to secure payment of such obligation (other
than Permitted Liens) and the failure to pay or discharge any such tax, charge
or claim could not have a Material Adverse Effect.
8.5 Maintenance of Existence, Etc. Maintain and preserve, and (subject to
Section 8.7) cause each of its Subsidiaries to maintain and preserve, (a) its
existence and good standing in the
45
jurisdiction of its organization and (b) its foreign qualification in each other
jurisdiction where the nature of its business makes such qualification necessary
(except in those instances in which the failure to be qualified or in good
standing will not have a Material Adverse Effect).
8.6 Financial Ratios and Restrictions.
(a) Financial Covenants:
(i) The Borrower and its Subsidiaries shall have EBITDA
(A) as at the end of each fiscal month through August 31, 2003
for the twelve fiscal months then ending and (B) as at the end
of each fiscal quarter thereafter, for the four fiscal quarters
then ending, of not less than the amounts set forth on Schedule
8.6(a)(i).
(ii) The Borrower shall not permit the consolidated
Capital Expenditures for the Borrower and its Subsidiaries (A)
computed as at the end of each fiscal quarter on a cumulative
basis from June 1, 2002 to the end of such fiscal quarter
through August 31, 2003 and (B) for each fiscal year ending on
or after August 31, 2004, to exceed the amount set forth in
Schedule 8.6(a)(ii).
(iii) The Borrower shall have revenue amounts for itself
and its Subsidiaries (A) as at any month end on or prior to
August 31, 2003 for the three months then ending and (B) as at
any fiscal quarter end thereafter for the four fiscal quarter
period then ending, not less than the amount set forth in
Schedule 8.6(a)(iii).
(iv) The Borrower shall not permit its Fixed Charge
Coverage Ratio (A) as at any fiscal month end on or prior to
August 31, 2003 for the twelve months then ending and (B) as at
any fiscal quarter end thereafter for such quarter to be less
than the ratio set forth in Schedule 8.6(a)(iv) for the four
fiscal quarters then ending set forth in said Schedule.
(v) The Borrower shall not permit its Leverage Ratio (A)
as at any fiscal month end on or prior to August 31, 2003 for
the twelve months then ending and (B) as at any fiscal quarter
end thereafter for the four fiscal quarters then ending to be
greater than the amount set forth in Schedule 8.6(a)(v);
provided, that if the Leverage Ratio listed in Schedule
8.6(a)(v) is negative because EBITDA is a negative number, then
the Borrower shall cause the ratio to be a positive amount, or a
negative amount less (i.e. further from zero) than the number
listed on such Schedule.
(vi) The Borrower shall not permit the Cash Restructuring
Expenses for it and its Subsidiaries for the period from the
date hereof through August 31, 2003 to exceed $15,000,000. The
Borrower and its Subsidiaries shall not incur any Cash
Restructuring Expenses after August 31, 2003.
(b) Adjustments. In connection with any sale of assets permitted
by this Agreement or consented to by the Majority Lenders and assuming
application of Net
46
Proceeds as required hereunder, the covenants under this Section 8.6
shall be adjusted, with the amount of such adjustment determined by
mutual agreement of the Majority Lenders and the Borrower.
8.7 Mergers, Consolidations and Purchases. Not, and not permit any of
its Subsidiaries to, be a party to any merger or consolidation, or purchase or
otherwise acquire all or a substantial portion of the business or, assets of, or
any stock of any class of, or any partnership or joint venture interest in, any
other Person, except for any such merger or consolidation, by any such
Subsidiary into or with the Borrower or into or with any wholly-owned Subsidiary
of the Borrower that has been authorized by Majority Lenders. Notwithstanding
the foregoing, no Guarantor may merge or consolidate unless the surviving
corporation is a Guarantor or the Borrower. No merger or consolidation will be
permitted if the result would be that a perfected Lien in Collateral shall no
longer be perfected.
8.8 Commercial Paper. Not, and not permit any of its Subsidiaries to,
create, incur, assume or suffer to exist or otherwise become or be liable in
respect of any Debt with respect to unsecured commercial paper.
8.9 Liens. Not, and not permit any of its Subsidiaries to, create or
permit to exist any Lien on any of its real or personal properties, assets or
rights of whatsoever nature, whether now owned or hereafter acquired, except
Permitted Liens.
8.10 Reserved.
8.11 Maintenance of Property. Maintain, and cause each of its
Subsidiaries to maintain, its properties which are material to the conduct of
its business in good working order and condition (ordinary wear and tear
excepted).
8.12 Employee Benefit Plans. Maintain, and cause each of its
Subsidiaries to maintain, each Pension Plan in compliance in all material
respects with all applicable Requirements of Law and regulations.
8.13 Business Activities. Not make any substantial change in the nature
of the business of the Borrower and its Subsidiaries, taken as a whole, from
that engaged in on the date of this Agreement.
8.14 Environmental Matters.
(a) Environmental Obligations. (i) Comply, and cause each of its
Subsidiaries to comply, in a reasonable manner with any applicable
Federal or state judicial or administrative order requiring the
performance at any real property owned, operated, or leased by the
Borrower or any such Subsidiary of activities in response to any Release
or threatened Release of any Hazardous Material, except for the period of
time that the Borrower or such Subsidiary is diligently in good faith
contesting such order; (ii) use and operate, and cause each such
Subsidiary to use and operate, all of its facilities and properties in
material compliance with all Environmental Laws; (iii) keep, and cause
each such Subsidiary to keep, all necessary permits, approvals,
certificates, licenses and other authorizations relating to environmental
matters in effect and remain in material
47
compliance therewith; (iv) handle, and cause each such Subsidiary to
handle, all Hazardous Materials in material compliance with all
applicable Environmental Laws; and (v) not, and not permit any such
Subsidiary to, commence disposal of any Hazardous Material into or onto
any real property owned, operated or leased by the Borrower or any of its
Subsidiaries nor allow any Lien imposed pursuant to any Environmental Law
to attach to any such real property.
(b) Environmental Information. Within 60 days of receipt thereof,
notify the Administrative Agent of the receipt by the Borrower or any of
its Subsidiaries of any written claim, demand, proceeding, action or
notice of liability by any Person arising out of or relating to the
Release or threatened Release of any Hazardous Material, except for any
release or threatened release with respect to which the maximum liability
of the Borrower and its Subsidiaries is reasonably expected to be less
than $1,000,000; and within 60 days of any Release, threatened Release,
or disposal of any Hazardous Material reported to any governmental
regulatory authority at any real property owned, operated or leased by
the Borrower or any of its Subsidiaries notify the Administrative Agent
of such release, threat of release or disposal, except for any release,
threat of release or disposal with respect to which the maximum liability
of the Borrower and its Subsidiaries is reasonably expected to be less
than $1,000,000.
8.15 Unconditional Purchase Obligations. Not, and not permit any of its
Subsidiaries to, enter into or be a party to any contract for the purchase of
materials, supplies or other property or services, if such contract requires
that payment be made by it regardless of whether or not delivery is ever made of
such materials, supplies or other property or services.
8.16 Inconsistent Agreements. Not, and not permit any of its
Subsidiaries to, enter into any agreement containing any provision which would
be violated or breached by any borrowing by the Borrower hereunder or by the
performance by the Borrower or any of its Subsidiaries of any of its obligations
hereunder.
8.17 Transactions with Affiliates. Not, and not permit any Subsidiary
to, enter into or permit to exist any transaction, arrangement or contract with
any of its Affiliates or any officer or director of the Borrower or any
Affiliate which is on terms less favorable than would be available from a Person
which is not an Affiliate. Nothing in this Section 8.17 shall prohibit any
transaction expressly permitted by Section 4.2(c), Section 8.7, Section 8.20(a)
or Section 8.21.
8.18 The Borrower's and Subsidiaries' Stock. Except pursuant to
transactions permitted by Section 8.7, not take any action, or permit any of its
Subsidiaries to take any action, which will, so long as any shares of capital
stock or indebtedness of any corporation which is a Subsidiary at the date of
this Agreement are owned by the Borrower or any Subsidiary, result in a decrease
in the percentage of the outstanding shares in capital stock of such corporation
owned at the date of this Agreement by the Borrower and its Subsidiaries.
8.19 Restrictive Agreements. Not, nor will it permit any of its
Subsidiaries to, enter into any agreement (excluding this Agreement and the Exit
Facility Credit Documents) (a) which would restrict the ability of any such
Subsidiary to pay or make dividends or distributions in cash or kind, to make
loans, advances or other payments of whatsoever nature, or to make transfers or
48
distributions of all or any part of its assets, in each case to the Borrower or
to any corporation as to which such Subsidiary is a Subsidiary; or (b) which
would require the consent or waiver of any third party to any amendment to this
Agreement or any other Loan Document.
8.20 Sales of Assets. Not, and shall not permit any of its Subsidiaries
to, except in the ordinary course of its business and/or as permitted under
Section 4.2(c), sell, transfer, convey or lease all or a substantial part of its
assets, or sell or assign with or without recourse any receivables, except for:
(a) any such sale, transfer, conveyance, lease or assignment of or
by any U.S. Subsidiary that is a Collateral Guarantor to another U.S.
Subsidiary that is a Collateral Guarantor, or by a Foreign Subsidiary to
a Foreign Subsidiary that is a Collateral Guarantor to another Foreign
Subsidiary that is a Collateral Guarantor;
(b) so long as no Event of Default or Default exists or would
result therefrom, any sale, transfer, conveyance or lease of any obsolete
equipment for cash provided that the aggregate book value (disregarding
any write-downs of such book value other than ordinary depreciation and
amortization) of all assets disposed of by the Borrower and its
Subsidiaries pursuant to this clause (b) does not exceed $5,000,000 in
the aggregate. The Administrative Agent or the U.S. Collateral Agent
shall, at the request of the Borrower and without any requirement for
approval from the Lenders, release any Lien on Collateral sold pursuant
to Section 8.20(b). In connection with any action permitted under this
clause (b), the Borrower will deliver a certificate, signed by the Chief
Financial Officer of the Borrower to the Administrative Agent or the U.S.
Collateral Agent calculating compliance with this clause (b); and
8.21 Loans and Investments. Not purchase or acquire, or suffer or permit
any Subsidiary to purchase or acquire, or make any commitment therefor, any
capital stock, equity interest, or any obligations or other securities of, or
any interest in, any other Person, or make or commit to make any advance, loan,
extension of credit or capital contribution to or any other investment in, any
Person including any Affiliate of the Borrower, except for:
(a) the Guaranties;
(b) the Exit Facility Credit Documents;
(c) investments in Cash Equivalents;
(d) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in
the ordinary course of business;
(e) Loans by the Borrower to, and investments by the Borrower in,
any of its Subsidiaries or by any of its Subsidiaries in another of its
Subsidiaries, except as prohibited under Article IV;
(f) loans and investments permitted under Section 4.2(c);
(g) transactions permitted under Section 8.7; and
49
(h) transactions contemplated under the Bill of Sale, Assignment
and Assumption Agreement, dated as of July 31, 2002, between Oldco and
the Borrower.
8.22 Limitation on Debt and Subsidiary Debt. Not, and shall not suffer
or permit any Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to any
Debt of the Borrower and Subsidiaries other than:
(a) Post-Petition Obligation; provided however that the principal
amount thereof shall not exceed $110,000,000 under any circumstances
except as permitted pursuant to sub paragraph (e) of this Section 8.22;
(b) the Obligations;
(c) Debt to RBS or National Westminister Bank PLC in connection
with any foreign exchange facilities or BACS facilities not to exceed
$1,000,000;
(d) Debt under Capital Leases existing on the date hereof and
listed on Schedule 8.22(d);
(e) additional Debt not to exceed $15,000,000 at any time
outstanding; and
(f) Debt to the Borrower or a Subsidiary to the extent the loan by
the Borrower or Subsidiary would be permitted under Section 8.21.
8.23 Restricted Payments. Not, and shall not suffer or permit any
Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock, or purchase, redeem or otherwise
acquire for value any shares of its capital stock or any warrants, rights or
options to acquire such shares, now or hereafter outstanding; except that:
(a) the Subsidiaries of the Borrower may pay dividends to the
Borrower and the Guarantors;
(b) dividends of $42,000 semiannually may be paid on the preferred
stock of McLean Midwest Corporation; and
(c) cash payments to redeem warrants representing the right to
receive fractional shares of capital stock of the Borrower pursuant to
the Plan.
8.24 Loan Notes. Not make any payment on the Loan Notes or reimburse the
guarantor with respect thereto.
50
ARTICLE IX
EVENTS OF DEFAULT AND THEIR EFFECT
9.1 Events of Default. Each of the following shall constitute an Event of
Default under this Agreement:
(a) Non-Payment of Loans, etc. Default in the payment when due of the
principal of any Loan; or default, and continuance thereof for five
Business Days, in the payment when due of any interest on any Loan or any
fees or other amounts payable by the Borrower hereunder.
(b) Non-Payment of Other Indebtedness for Borrowed Money. Default in
the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any other Debt of, or guaranteed by, the
Borrower or any of its Subsidiaries in excess in the aggregate of
$2,000,000; or default in the performance or observance of any obligation
or condition with respect to any such other indebtedness in excess in the
aggregate of $2,000,000 if the effect of such default is to accelerate the
maturity of any such indebtedness or to permit the holder or holders
thereof, or any trustee or agent for such holders, to cause such
indebtedness to become due and payable prior to its expressed maturity.
(c) Representations and Warranties. Any representation or warranty
made by the Borrower or any Subsidiary of the Borrower herein or in any
Loan Document is breached, or is false or misleading, in any material
respect, or any schedule, certificate, financial statement, report, notice
or other writing furnished by the Borrower to the Administrative Agent or
any Lender is false or misleading in any material respect on the date as of
which the facts therein set forth are stated or certified.
(d) Non-Compliance with Certain Covenants. Failure by the Borrower to
comply with or to perform any provision of Section 8.1(h), Section 8.6
through 8.9, 8.16, or 8.18 through 8.24.
(e) Non-Compliance with Other Covenants. Failure by the Borrower or
any Subsidiary to comply with or to perform any other provision of this
Agreement or any other Loan Document (and not constituting an Event of
Default under any of the other provisions of this Article IX) and
continuance of such failure for thirty days.
(f) Pension Plans. (i) Institution of any steps by the Borrower or any
other Person to terminate a Pension Plan if as a result of such termination
the Borrower or any Subsidiary could be required to make a contribution to
such Pension Plan, or could incur a liability or obligation to such Pension
Plan, in excess of $1,000,000, or (ii) a contribution failure occurs with
respect to any Pension Plan sufficient to give rise to a Lien under section
302(f) of ERISA.
(g) Bankruptcy, Insolvency, etc. The Borrower or any of the
Subsidiaries of the Borrower (other than any Dissolution Subsidiary)
becomes insolvent or generally fails to pay, or admits in writing its
inability to pay, debts as they become due; or the Borrower
51
or any such Subsidiaries (other than any Dissolution Subsidiary) applies
for, consents to or acquiesces in the appointment of a trustee, receiver or
other custodian for the Borrower or such Subsidiary (other than any
Dissolution Subsidiary) or any property thereof, or makes a general
assignment for the benefit of creditors; or, in the absence of such
application, consent or acquiescence, a trustee, receiver or other
custodian is appointed for the Borrower or any of the Subsidiaries of the
Borrower (other than any Dissolution Subsidiary) or for a substantial part
of its property and is not discharged within 30 days; or any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution or liquidation proceeding
(except the voluntary dissolution, not under any bankruptcy or insolvency
law, of a Subsidiary), is commenced in respect of the Borrower or any of
the Subsidiaries of the Borrower, and, if such case or proceeding is not
commenced by such Subsidiary, it is consented to or acquiesced in by such
Subsidiary or remains for 30 days undismissed or an order for relief is
entered in any such involuntary bankruptcy; or the Borrower or any
Subsidiary of the Borrower takes any corporate action to authorize, or in
furtherance of, any of the foregoing.
(h) Judgments. Final judgments which exceed an aggregate of $2,000,000
(excluding any portion thereof which is covered by insurance maintained
with a responsible insurance company which has accepted a tender of defense
and indemnification without reservation of rights) shall be rendered
against the Borrower or any of the Subsidiaries of the Borrower and shall
not have been discharged or vacated or had execution thereof stayed pending
appeal within 30 days after entry or filing of such judgments.
(i) Invalidity of Loan Documents, etc. Any Loan Document shall cease
to be in full force and effect; or the Borrower or any Subsidiary (or any
Person by, through or on behalf of the Borrower or any Subsidiary) shall
contest in any manner the validity, binding nature or enforceability of any
Loan Document (including, without limitation, the Intercreditor Agreement).
(j) Confirmation Order. The Confirmation Order shall be vacated,
modified, or otherwise altered or stayed after the Effective Date and the
effect thereof shall be adverse to the rights of the Lenders hereunder or
under any of the Loan Documents in the opinion of the Majority Lenders or
to the rights of the Administrative Agent hereunder or under any of the
Loan Documents in the opinion of the Administrative Agent.
(k) Guaranty. The obligations of any Guarantor under any Guaranty
shall cease to be in full force and effect or such Guarantor shall contest
in any manner the validity, binding nature or enforceability of its
Guaranty, other than in respect of the full and indefeasible payment of the
Obligations.
(l) Collateral.
(i) Any provision of any Collateral Document shall for any reason
(except as a result of any action or inaction on the part of any
Lender or Administrative Agent) cease to be valid and binding on or
enforceable against the
52
Borrower or any Subsidiary party thereto or the Borrower or any
Subsidiary shall so state in writing or bring an action to limit its
obligations or liabilities thereunder; or
(ii) Any Collateral Document or Collateral Documents shall for
any reason (except as a result of any action or inaction on the part
of any Lender or Administrative Agent or pursuant to the terms
thereof) cease to create a valid security interest in the Collateral
purported to be covered thereby or such security interest shall for
any reason cease to be a perfected security interest (second in
priority only to Prior Permitted Liens and as set forth in the
Intercreditor Agreement), if the effect thereof is to cause Collateral
having an aggregate value in excess of $2,000,000 to no longer be
covered by a perfected security interest with such priority.
(m) Impermissible Change of Control. An Impermissible Change in
Control shall have occurred.
9.2 Effect of Event of Default. If any Event of Default described in
Section 9.1(g) shall occur, all Loans and all interest and other amounts due
hereunder shall become immediately due and payable, all without presentment,
demand or notice of any kind (all of which are hereby expressly waived by the
Borrower); and, in the case of any other Event of Default, the Administrative
Agent may with the consent of the Majority Lenders, and shall upon written
request of the Majority Lenders, declare all Loans and all interest and other
amounts due hereunder to be due and payable, whereupon all Loans and all
interest and other amounts due hereunder shall become immediately due and
payable, all without presentment, demand or notice of any kind (all of which are
hereby expressly waived by the Borrower). The Administrative Agent shall
promptly advise the Borrower and each Lender of any such declaration, but
failure to do so shall not impair the effect of such declaration.
Notwithstanding the foregoing, the effect as an Event of Default of any event
described in Section 9.1 may be waived by the written concurrence of the
Majority Lenders; provided that in the case of a waiver of an Event of Default
described in Section 9.1(k) (Guaranty) or 9.1(l) (Collateral) above, such waiver
shall not release the Borrower or any Subsidiary from its further assurance
obligations under Section 4.4, compliance with which shall be a condition of any
such waiver; and provided further that the effect as an Event of Default of any
event described in Sections 9.1(a) and (g) may be waived only by the written
concurrence of all the Lenders; and provided further that the effect as an Event
of Default of any event, arising under a provision which would require the
consent of Supermajority Lenders to amend under Section 11.1, may be waived only
by the written concurrence of the Supermajority Lenders; and provided further
that the effect as an Event of Default of any event arising under a provision
which would require the consent of all the Lenders, may be waived only by the
written concurrence of all the Lenders. In the event of such a declaration, the
Administrative Agent and the Collateral Agents (in each case upon the written
direction of the Majority Lenders) further may exercise the remedies provided in
the Loan Documents and/or applicable law.
53
ARTICLE X
THE ADMINISTRATIVE AGENT AND COLLATERAL AGENTS
10.1 Appointment and Authorization; Administrative Agent; Collateral
Agents. Each Lender hereby irrevocably (subject to Section 10.9) appoints,
designates and authorizes each of the Administrative Agent and the Collateral
Agents (collectively, the "Agents") to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agents
shall not have any duties or responsibilities, except those expressly set forth
herein, nor shall the Agents have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agents.
Without limiting the generality of the foregoing sentence, the use of the term
"agent" in this Agreement with reference to the Agents is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used merely as a
matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties. Except as
expressly otherwise provided in this Agreement, the Agents shall have and may
use their sole discretion with respect to exercising or refraining from
exercising any discretionary rights or refraining from taking any actions which
the Agents are expressly entitled or directed to take or assert under this
Agreement and the other Loan Documents, including the refraining from the
exercise of remedies pursuant to Section 9.2 (or otherwise), and any action so
taken or not taken shall be deemed consented to by the Lenders.
10.2 Delegation of Duties. The Agents may execute any of their duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agents shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
10.3 Liability of Agents. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by the Borrower or any Subsidiary or
Affiliate of the Borrower, or any officer thereof, contained in this Agreement
or in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agents under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Borrower or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any
54
other Loan Document, or to inspect the properties, books or records of the
Borrower or any of the Borrower's Subsidiaries or Affiliates.
10.4 Reliance by Agents; Rights to Specific Indemnification.
(a) The Agents shall be entitled to conclusively rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel
(including counsel to the Borrower), independent accountants and other
experts selected by the Agents. Notwithstanding any other provision of this
Agreement or any other Loan Documents to the contrary, each Agent shall be
fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Majority Lenders or the Supermajority Lenders
as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Notwithstanding any other provision of
this Agreement or any other Loan Document to the contrary, each Agent shall
in all cases be fully protected in acting, or in refraining from acting,
under this Agreement or any other Loan Document in accordance with a
request or consent of the Majority Lenders or the Supermajority Lenders and
such request and any action taken or failure to act pursuant thereto shall
be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 9.1, each Lender that has executed this Agreement
shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter either sent by an Agent to
such Lender for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory
to the Lender.
10.5 Notice of Default. The Agents shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, except, in the case
of the Administrative Agent, with respect to defaults in the payment of
principal, interest and fees required to be paid to the Administrative Agent for
the account of the Lenders, unless the Administrative Agent shall have received
written notice from a Lender or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". The Administrative Agent will notify the Lenders of its
receipt of any such notice. Subject in all respects to the provisions of this
Article X (including, without limitation, the provisions of Section 10.4(a)
hereof), the Agents shall take such action with respect to such Default or Event
of Default as may be requested by the Majority Lenders in accordance with
Article IX; provided, however, that unless and until any Agent has received any
such request, the Agent shall not be obligated to take any action with respect
to such Default or Event of Default.
10.6 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by any Agent hereinafter taken, including any review of the affairs of the
Borrower and its Subsidiaries, shall be deemed
55
to constitute any representation or warranty by any Agent-Related Person to any
Lender. Each Lender represents to the Agents that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Borrower and its Subsidiaries, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to the Borrower hereunder. Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower. Except for notices, reports and other
documents expressly herein required to be furnished to the Lenders by the
Agents, the Agents shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of the
Borrower which may come into the possession of any of the Agent-Related Persons.
10.7 Indemnification of Agents. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower to do so), pro
rata, from and against any and all Indemnified Liabilities; provided, however,
that no Lender shall be liable for the payment to the Agent-Related Persons of
any portion of such Indemnified Liabilities that are determined in a final
non-appealable decision of a court of competent jurisdiction to have resulted
from such Person's gross negligence or willful misconduct. Without limitation of
the foregoing, each Lender shall reimburse each Agent upon demand for its
ratable share of any reasonable costs or reasonable out-of-pocket expenses
(including reasonable Attorney Costs) incurred by such Agent in connection with
the preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not promptly reimbursed for such expenses by or
on behalf of the Borrower. The undertaking in this Section shall survive the
repayment of all Obligations hereunder, any foreclosure under, or modification,
release or discharge of, any of the Collateral Documents, the termination of
this Agreement and the resignation or replacement of such Agent.
10.8 Bank of America and RBS in Individual Capacity. Bank of America and
its Affiliates and RBS and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its Subsidiaries and Affiliates as
though Bank of America were not the Administrative Agent or one of the
Collateral Agents hereunder and as if RBS was not a Collateral Agent hereunder,
and without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates or RBS or its
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality
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obligations in favor of the Borrower or such Subsidiary) and acknowledge that
neither Bank of America nor RBS nor the Administrative Agent or any of the
Collateral Agents shall be under any obligation to provide such information to
them.
10.9 Successor Agents. The Agents may, and at the request of the Majority
Lenders shall, resign as Administrative Agent or Collateral Agent, as
applicable, upon 30 days' notice to the Lenders. If any Agent resigns under this
Agreement, the Majority Lenders shall appoint from among the Lenders a successor
agent for the Lenders. If no successor agent is appointed prior to the effective
date of the resignation of an Agent, such Agent may appoint, after consulting
with the Lenders and the Borrower, a successor agent from among the Lenders.
Upon the acceptance of its appointment as successor agent hereunder, such
successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Administrative Agent" or "Collateral Agent" (as the
case may be) shall mean such successor agent and the retiring Agent's
appointment, powers and duties as Administrative Agent or Collateral Agent, as
applicable, shall be terminated. After any retiring Agent's resignation
hereunder as Administrative Agent or Collateral Agent, as applicable, the
provisions of this Article X shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent or Collateral
Agent, as applicable, under this Agreement. If no successor agent has accepted
appointment as Administrative Agent or Collateral Agent, as applicable, by the
date which is 30 days following delivery of a retiring Administrative Agent's
notice of resignation, the retiring Administrative Agent's or Collateral Agent,
as applicable, resignation shall nevertheless thereupon become effective and the
Lenders shall perform all of the duties of the Agent hereunder until such time,
if any, as the Majority Lenders appoint a successor agent as provided for above.
10.10 Withholding Tax.
(a) If any Lender is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Lender claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code,
such Lender agrees with and in favor of the Administrative Agent, to
deliver to the Administrative Agent:
(i) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form W-8BEN on or before the
payment of any interest in the first calendar year and before the
payment of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(ii) if such Lender claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year
of such Lender and in each succeeding taxable year of such Lender
during which interest may be paid under this Agreement; and
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(iii) if such Lender is a foreign partnership or other
intermediary and its partners claim an exemption from, or a reduction
of, withholding tax under a United States tax treaty or if its
partners claim that interest paid under this Agreement is exempt from
Untied States withholding tax because it is effectively connected with
the conduct with a United States trade or business, two properly
completed and executed copies of IRS Form W-8IMY on or before the
payment of any interest in the first calendar year and before the
payment of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(iv) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from,
or reduction of, United States withholding tax.
Such Lender agrees to promptly notify the Administrative Agent of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.
(b) If any Lender claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such
Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of the Borrower to such Lender, such Lender
agrees to notify the Administrative Agent of the percentage amount in which
it is no longer the beneficial owner of Obligations of the Borrower to such
Lender. To the extent of such percentage amount, the Administrative Agent
will treat such Lender's IRS Form W-8BEN as no longer valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form W-8ECI with the Administrative Agent sells, assigns,
grants a participation in, or otherwise transfers all or part of the
Obligations of the Borrower to such Lender, such Lender agrees to undertake
sole responsibility for complying with the withholding tax requirements
imposed by Sections 1441 and 1442 of the Code.
(d) If any Lender is a foreign partnership or other intermediary and
its partners claim exemption from, or reduction of, withholding tax under a
United States tax treaty by providing IRS Form W-8BEN or its partners claim
exemption from United States withholding tax by filing IRS Form W-8ECI, and
any of its partners sell, assign, grant a participation in, or otherwise
transfer all or part of the Obligations of the Borrower to such Lender,
such Lender agrees to notify the Administrative Agent of the percentage
amount in which the partner is no longer the beneficial owner of
Obligations of the Borrower to such Lender. To the extent of such
percentage amount, the Administrative Agent will treat such partner's IRS
Form W-8BEN or W-8ECI as no longer valid.
(e) If any Lender is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any interest
payment to such Lender an amount equivalent to the applicable withholding
tax after taking into account such reduction. However, if the forms or
other documentation required by Section 10.10(a) are not delivered to the
Administrative Agent, then the Administrative Agent may withhold from any
interest payment to such Lender not providing such forms or other
documentation an
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amount equivalent to the applicable withholding tax imposed by Sections
1441 and 1442 of the Code, without reduction.
(f) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Administrative Agent
did not properly withhold tax from amounts paid to or for the account of
any Lender (because the appropriate form was not delivered, was not
properly executed, or because such Lender failed to notify the
Administrative Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any
other reason) such Lender shall indemnify the Administrative Agent fully
for all amounts paid, directly or indirectly, by the Administrative Agent
as tax or otherwise, including penalties and interest, and including any
taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, together with all costs and
expenses (including Attorney Costs). The obligation of the Lenders under
this Section 10.10(f) shall survive the payment of all Obligations and the
resignation or replacement of the Administrative Agent.
ARTICLE XI
MISCELLANEOUS
11.1 Amendments and Waivers.
(a) No delay on the part of the Administrative Agent, either
Collateral Agent, or any Lender in the exercise of any right, power or
remedy shall operate as a waiver thereof, nor shall any single or partial
exercise by any of them of any right, power or remedy preclude other or
further exercise thereof, or the exercise of any other right, power or
remedy. No right or remedy herein conferred upon the Lenders or the Agents
is intended to be exclusive of any other right or remedy contained herein
or in any other Loan Document, and every such right or remedy shall be
cumulative and shall be in addition to every other such right or remedy
contained herein or therein or now or hereafter existing at law or in
equity or by statute or otherwise.
(b) Except to the extent that a greater percentage of approval is
required pursuant to the other provisions of this Agreement (including the
other provisions of this Section 11.1), no amendment, modification or
waiver of any provision of this Agreement or the Notes shall in any event
be effective unless the same shall be in writing and signed and delivered
by the Borrower and the Majority Lenders, and then any such amendment,
modification, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
(c) No amendment, modification, waiver, consent or forbearance of any
provisions of this Agreement or the Notes in relation to, and no decision
relating to Sections 8.9 or 8.22 or the definitions of "Post-Petition
Credit Agreement" or "Exit Facility Credit Documents" (if the effect of any
such definitional change would permit an increase in the principal amount
of the Post-Petition Credit Agreement or the Exit
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Facility Credit Documents) or the definition of "Permitted Liens" shall be
effective unless the same shall be in writing and signed and delivered by
the Supermajority Lenders, and then any such amendment, modification,
waiver, forbearance, or consent shall be effective only in the specific
instance and for the specific purpose for which it is given. No amendment,
modification, waiver, consent or forbearance of any provision of the
Intercreditor Agreement shall be effective, unless the same shall be in
writing and signed and delivered by the Supermajority Lenders, and then any
such amendment, modification, waiver, forbearance, or consent shall be
effective only in the specific instance and for the specific purpose for
which it is given.
(d) No amendment, modification, waiver or consent shall modify any
Section explicitly requiring Supermajority Lenders' action or action by a
greater percentage of Lenders without the consent of the Supermajority
Lenders or such greater percentage of Lenders, as the case may be.
(e) No release of Collateral shall be permitted except with the
consent of Two-Thirds Lenders; provided, however, consistent with, but not
in limitation of the provisions of the Intercreditor Agreement, in the
event of any conflict between the provisions of this clause (e) and the
provisions of the Intercreditor Agreement, the provisions of the
Intercreditor Agreement shall govern, and, provided, further, that the
Administrative Agent is authorized and directed to release security
interests and liens in Collateral as provided under Section 8.20(b) as in
effect on the date hereof.
(f) Notwithstanding any other provision of this Agreement or any other
Loan Document to the contrary, in each of the following cases, without the
consent of all Lenders directly affected thereby, no amendment,
modification, waiver or consent shall:
(i) increase the amount of the Loans,
(ii) extend any date for payment of principal of, on interest
on, the Loans or any fees hereunder,
(iii) reduce the principal amount of, the rate of interest
thereon or any fees payable hereunder or amend the definition of
"Termination Date" or the "Effective Date,"
(iv) release any material Guarantor except for the release of a
Guarantor in connection with any sale of such Guarantor or
substantially all its assets as permitted under Section 8.20,
(v) modify the definition of "Supermajority Lenders," "Majority
Lenders" or "Two Thirds Lenders,"
(vi) release the Borrower from any of its obligations under
Article IX,
(vii) amend this Section 11.1(f).
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(g) Notwithstanding any other provision of this Agreement or any other
Loan Document to the contrary, no provision of Article X or other provision
of this Agreement affecting the Agent in its capacity as such shall be
amended, modified or waived without the consent of such Agent.
11.2 Notices.
(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by the Borrower by facsimile (i) shall be immediately confirmed
by a telephone call to the recipient at the number specified on Schedule
11.2, and (ii) shall be followed promptly by delivery of a hard copy
original thereof) and mailed, faxed or delivered, to the address or
facsimile number specified for notices on Schedule 11.2; or, as directed to
the Borrower or the Administrative Agent, to such other address as shall be
designated by such party in a written notice to the other parties, and as
directed to any other party, at such other address as shall be designated
by such party in a written notice to the Borrower and the Administrative
Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered
for overnight (next-day) delivery, or transmitted in legible form by
facsimile machine, respectively, or if mailed, upon the third Business Day
after the date deposited into the U.S. mail, or if delivered, upon
delivery; except that notices pursuant to Article II, shall not be
effective until actually received by the Administrative Agent.
(c) Any agreement of the Administrative Agent and the Lenders herein
to receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Borrower. The Administrative Agent
and the Lenders shall be entitled to rely on the authority of any Person
purporting to be a Person authorized by the Borrower to give such notice
and the Administrative Agent and the Lenders shall not have any liability
to the Borrower or other Person on account of any action taken or not taken
by the Administrative Agent or the Lenders in reliance upon such telephonic
or facsimile notice. The obligation of the Borrower to repay the Loans
shall not be affected in any way or to any extent by any failure by the
Administrative Agent and the Lenders to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Administrative Agent
and the Lenders of a confirmation which is at variance with the terms
understood by the Administrative Agent and the Lenders to be contained in
the telephonic or facsimile notice.
11.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
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11.4 Costs, Expenses and Taxes. The Borrower agrees to pay on demand, (a)
all reasonable out-of-pocket costs and expenses of each Agent (including the
fees and charges of counsel for each Agent, of local counsel, if any, who may be
retained by said counsel and the reasonable fees and expenses of financial
advisors to each Agent) in connection with the administration of this Agreement,
the other Loan Documents and all other documents provided for herein or
delivered or to be delivered hereunder or in connection herewith (including any
amendment, supplement or waiver to any Loan Document), and (b) all costs and
expenses (including reasonable attorneys' fees (including the allocable costs of
internal legal services and all disbursements of internal counsel), court costs
and other legal expenses of the Agents and each of the Lenders and the
reasonable fees and expenses of financial advisors to each Agent) incurred by
any Agent and each Lender in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement, the
other Loan Documents or any other documents during the existence of an Event of
Default or after acceleration (including in connection with any "workout" or
restructuring regarding the Loans, and including in any Insolvency Proceeding or
appellate proceeding). In addition, the Borrower agrees to pay, and to save each
Agent and the Lenders harmless from all liability for, (a) any stamp or other
taxes which may be payable in connection with the execution and delivery of this
Agreement, the borrowings hereunder, the issuance of the Notes or the execution
and delivery of any other Loan Document or any other document provided for
herein or delivered or to be delivered hereunder or in connection herewith and
(b) any fees of the Borrower's auditors in connection with any exercise by any
Agent and the Lenders of their rights pursuant to Section 8.2. All obligations
provided for in this Section 11.4 shall survive repayment of the Loans,
cancellations of the Notes and any termination of this Agreement.
11.5 Borrower Indemnification. The Borrower shall indemnify, defend and
hold the Agent-Related Persons, and each Lender and each of their respective
officers, directors, employees, counsel, agents, consultants and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, charges, expenses and disbursements (including Attorney
Costs) of any kind or nature whatsoever which may at any time (including at any
time following repayment of the Loans and the termination, resignation or
replacement of each Agent or replacement of any Lender) be imposed on, incurred
by or asserted against any such Person in any way relating to or arising out of
this Agreement or any document contemplated by or referred to herein, or the
transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with respect
to any investigation, litigation or proceeding (including any insolvency
proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or the use of the proceeds thereof, whether or not any Indemnified
Person is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided, that the Borrower shall have no obligation hereunder to
any Indemnified Person with respect to Indemnified Liabilities that are
determined in a final, non-appealable decision of a court of competent
jurisdiction to have resulted solely from the gross negligence or willful
misconduct of such Indemnified Person. The agreements in this Section shall
survive payment of all other Obligations. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, the Borrowers hereby
jointly and severally agree to make the maximum contribution to the payment and
satisfaction of the Indemnified Liabilities that is permitted under applicable
law. All obligations provided for in this Section 11.5 shall survive repayment
of the Loans, cancellation of the Notes, any foreclosure under, or any
modification,
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release or discharge of, any or all of the Collateral Documents and any
termination of this Agreement.
11.6 Payments Set Aside. To the extent that the Borrower makes a payment to
the Administrative Agent or the Lenders, or the Administrative Agent or the
Lenders exercise their right of set-off, and such payment or the proceeds of
such set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent
of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its pro rata
share of any amount so recovered from or repaid by the Administrative Agent.
11.7 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Administrative Agent and each Lender.
11.8 Assignments, Participations, Etc.
(a) Any Lender may at any time assign and delegate to one or more
Eligible Assignees (each an "Assignee") all, or any ratable part of all, of
the Loans, the other rights and obligations of such Lender hereunder, in a
minimum amount of the lesser of (i) $5,000,000 or (ii) the full amount of
the Loans, and the other rights and obligations of such Lender; provided,
however, that the Borrower and the Administrative Agent may continue to
deal solely and directly with such Lender in connection with the interest
so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, shall have been given to the Borrower and the
Administrative Agent by such Lender and the Assignee; (ii) such Lender and
its Assignee shall have delivered to the Borrower and the Administrative
Agent an Assignment and Acceptance in the form of Exhibit H ("Assignment
and Acceptance"), requiring, among other things, that any Assignee agree to
be bound by the Intercreditor Agreement and (iii) the assignor Lender or
Assignee has paid to the Administrative Agent a processing fee in the
amount of $3,500.
(b) From and after the date that the Administrative Agent notifies the
assignor Lender that it has received an executed Assignment and Acceptance
and payment of the above-referenced processing fee, (i) the Assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment
and Acceptance, shall have the rights and obligations of a Lender under the
Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have
been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under the Loan Documents.
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(c) Immediately upon each Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Loans arising
therefrom. The Loans allocated to each Assignee shall reduce such Loans of
the assigning Lender pro tanto.
(d) Any Lender may at any time sell to one or more commercial Lenders
or other Persons (a "Participant") participating interests in any Loans of
that Lender and the other interests of that Lender (the "Originating
Lender") hereunder and under the other Loan Documents; provided, however,
that (i) the Originating Lender's obligations under this Agreement shall
remain unchanged, (ii) the Originating Lender shall remain solely
responsible for the performance of such obligations, (iii) the Borrower and
the Administrative Agent shall continue to deal solely and directly with
the Originating Lender in connection with the Originating Lender's rights
and obligations under this Agreement and the other Loan Documents, and (iv)
no Lender shall transfer or grant any participating interest under which
the Participant has rights to approve any amendment to, or any consent or
waiver with respect to, this Agreement or any other Loan Document, except
to the extent such amendment, consent or waiver would require unanimous
consent of the Lenders as described in Section 10.1. In the case of any
such participation, the Participant shall be entitled to the benefit of
Sections 5.2, 5.4 and 11.5 as though it were also a Lender hereunder
provided that all amounts payable by the Borrower hereunder shall be
determined as if such Originating Lender had not sold such participation.
If amounts outstanding under this Agreement are due and unpaid, or shall
have been declared or shall have become due and payable upon the occurrence
of an Event of Default, each Participant shall be deemed to have the right
of set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Lender
may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
11.9 Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Borrower and provided to it by the Borrower or any of its
Subsidiaries, or by the Agent on the Borrower's or Subsidiary's behalf, under
this Agreement or any other Loan Document, and neither it nor any of its
Affiliates shall use any such information other than in connection with or in
enforcement of this Agreement and the other Loan Documents or in connection with
other business now or hereafter existing or contemplated with the Borrower or
any of its Subsidiaries; except to the extent such information (i) was or
becomes generally available to the public other than as a result of disclosure
by the Lender, or (ii) was or becomes available on a non-confidential basis from
a source other than the Borrower, provided that such source is not bound by a
confidentiality agreement with the
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Borrower known to the Lender; provided, however, that any Lender may disclose
such information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Lender is subject or in connection with an
examination of such Lender by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable requirement of law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the
Administrative Agent, any Lender, or their respective Affiliates may be party;
(E) to the extent reasonably required in connection with the exercise of any
remedy hereunder or under any other Loan Document; (F) to such Lender's
independent auditors and other professional advisors; (G) to any Participant or
Assignee, actual or potential, or such Lender's direct or indirect contractual
counterparties in swap agreements or to legal counsel, accountants and other
professional advisors to such counterparties provided that such Person agrees in
writing to keep such information confidential to the same extent required of the
Lenders hereunder; (H) as to any Lender or its Affiliate, as expressly permitted
under the terms of any other document or agreement regarding confidentiality to
which the Borrower or any of its Subsidiaries is party or is deemed party with
such Lender or such Affiliate; and (I) to its Affiliates.
11.10 Set-off. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Borrower, any such notice being waived by the
Borrower to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final)
(including deposits in other currencies in amounts determined at the Spot Rate
on the date of set-off) at any time held by, and other indebtedness at any time
owing by, such Lender to or for the credit or the account of the Borrower
against any and all Obligations owing to such Lender, now or hereafter existing,
irrespective of whether or not the Administrative Agent or such Lender shall
have made demand under this Agreement or any Loan Document and although such
Obligations may be contingent or unmatured. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off and
application made by such Lender; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application.
11.11 Notification of Addresses, Lending Offices, Etc. Each Lender shall
notify the Administrative Agent in writing of any changes in the address to
which notices to the Lender should be directed, of addresses of any Lending
Office, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as the Administrative
Agent shall reasonably request.
11.12 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
11.13 Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
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11.14 No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of the Borrower, the Lenders, the
Administrative Agent and the Agent-Related Persons and other Indemnified
Parties, and their permitted successors and assigns, and no other Person shall
be a direct or indirect legal beneficiary of, or have any direct or indirect
cause of action or claim in connection with, this Agreement or any of the other
Loan Documents.
11.15 Nonliability of Lenders. The relationship between the Borrower on the
one hand and the Lenders and the Administrative Agent on the other hand shall be
solely that of borrower and lender (and agent for the lenders). Neither any
Agent nor any Lender shall have any fiduciary responsibility to the Borrower.
Neither any Agent nor any Lender undertakes any responsibility to the Borrower
to review or inform the Borrower of any matter in connection with any phase of
the Borrower's business or operations. The Borrower agrees that neither any
Agent nor any Lender shall have liability to the Borrower (whether sounding in
tort, contract or otherwise) for losses suffered by the Borrower in connection
with, arising out of, or in any way related to the transactions contemplated and
the relationship established by the Loan Documents, or any act, omission or
event occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted solely from the gross negligence or willful misconduct of the party
from which recovery is sought. Neither any Agent nor any Lender shall have any
liability with respect to, and the Borrower hereby waives, releases and agrees
not to sue for, any special, indirect or consequential damages suffered by the
Borrower or any of its Subsidiaries in connection with, arising out of, or in
any way related to the Loan Documents or the transactions contemplated thereby.
11.16 Power of Attorney. The Borrower appoints the Collateral Agents, and
each other Person whom a Collateral Agent may from time to time designate, as
the Borrower's attorney and agent-in-fact with power (which appointment and
power, being coupled with an interest, is irrevocable until all Loans and other
obligations hereunder are paid and performed in full and this Agreement is
terminated), without notice to any Borrower, to:
(a) At such time or times while an Event of Default exists, as a
Collateral Agent or said agent, in its discretion, may determine in the
name of such Borrower or the Collateral Agent (i) endorse the Borrower's
name on any checks, notes, drafts or any other items of payment relating to
and/or proceeds of the Collateral which come into the possession of the
Collateral Agent or any Lender or under the Collateral Agent's or any
Lender's control and apply such payment or proceeds to the Loans and other
obligations hereunder, (ii) endorse the Borrower's name on any chattel
paper, document, instrument, invoice, freight bill, bill of lading or
similar document or agreement in the Collateral Agent's or any Lender's
possession relating to Accounts, Inventory or any other Collateral, (iii)
use the information recorded on or contained in any data processing
equipment and computer hardware and software to which the Borrower has
access relating to Accounts, Inventory or other Collateral, (iv) use the
Borrower's stationery and sign the name of the Borrower to verifications of
Accounts and notices thereof to Account Borrowers and (v) if not done by
the Borrower, do all acts and things determined by the Majority Lenders to
be necessary to fulfill the Borrower's obligations under this Agreement;
and
66
(b) At such time or times while an Event of Default exists, as a
Collateral Agent or said agent, in its discretion (with the consent of the
Majority Lenders), may determine, in the name of such Borrower or the
Collateral Agent (i) demand payment of the Accounts, (ii) enforce payment
of the Receivables, by legal proceedings or otherwise, (iii) exercise all
of such Borrower's rights and remedies with respect to the collection of
the Accounts and other Collateral, (iv) settle, adjust, compromise, extend
or renew the Accounts, (v) settle, adjust or compromise any legal
proceedings brought to collect the Accounts, (vi) if permitted by
applicable law, sell or assign the Accounts or other Collateral upon such
terms for such amounts and at such time or times as the Collateral Agent
may deem advisable, (vii) discharge and release the Accounts or other
Collateral, (viii) prepare, file and sign the Borrower's name on any proof
of claim in bankruptcy or similar document against any Account Debtor, (ix)
prepare, file and sign the Borrower's name on any notice of lien,
assignment or satisfaction of lien or similar document in connection with
the Receivables or other Collateral and (x) do all acts and things
necessary, in the Collateral Agent's discretion (as confirmed in writing by
the Majority Lenders), to obtain repayment of the Loans and other
obligations hereunder.
11.17 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE
ADMINISTRATIVE AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
11.18 Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS
OR THE BORROWERS (OR ANY OF THEM) MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF
THE STATE OF ILLINOIS OR OF THE UNITED STATES DISTRICT COURT OF THE NORTHERN
DISTRICT OF ILLINOIS. EACH BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS AND UNITED STATES
DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT
RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, OR BY PERSONAL SERVICE WITHIN OR OUTSIDE OF THE STATE OF NEW YORK.
BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
11.19 Waiver of Jury Trial. THE ADMINISTRATIVE AGENT, COLLATERAL AGENTS,
THE LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHTS THEY MAY HAVE TO A
67
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR
ACTION OF THE ADMINISTRATIVE AGENT, THE LENDERS OR THE BORROWER. BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO
WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
ADMINISTRATIVE AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT AND EACH SUCH
OTHER LOAN DOCUMENT.
11.20 Judgment. If, for the purposes of obtaining judgment in any court, it
is necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of exchange used shall be that at which
in accordance with normal banking procedures the Administrative Agent could
purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of the Borrower
in respect of any such sum due from it to the Administrative Agent and the
Lenders hereunder or under the other Loan Documents shall, notwithstanding any
judgment in a currency (the "Judgment Currency") other than that in which such
sum is denominated in accordance with the applicable provisions of this
Agreement (the "Agreement Currency"), be discharged only to the extent that on
the Business Day following receipt by the Administrative Agent of any sum
adjudged to be so due in the Judgment Currency, the Administrative Agent may in
accordance with normal banking procedures purchase the Agreement Currency with
the Judgment Currency. If the amount of the Agreement Currency so purchased is
less than the sum originally due to the Administrative Agent and the Lenders in
the Agreement Currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or the
Person to whom such obligation was owing against such loss. If the amount of the
Agreement Currency so purchased is greater than the sum originally due to the
Administrative Agent and the Lenders in such currency, the Administrative Agent
agrees to return the amount of any excess to the Borrower (or to any other
Person who may be entitled thereto under applicable law).
11.21 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Borrower,
the Lenders and the Administrative Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
68
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective duly authorized officers and delivered at
Chicago, Illinois as of the day and year first above written.
AWP LTD.
By:____________________________________
Name:
Title:
BANK OF AMERICA, NATIONAL
ASSOCIATION, as Administrative Agent and
as a Lender
By:____________________________________
Name:
Title:
BNP PARIBAS
By:____________________________________
Name:
Title:
GRAND STREET HOLDINGS 1, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:____________________________________
Name:
Title:
Term Loan Agreement
GRAND STREET HOLDINGS 2, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:____________________________________
Name:
Title:
GRAND STREET HOLDINGS 3, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:____________________________________
Name:
Title:
GRAND STREET HOLDINGS 4, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:____________________________________
Name:
Title:
GRAND STREET HOLDINGS 5, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:____________________________________
Name:
Title:
Term Loan Agreement
GRAND STREET HOLDINGS 6, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:_________________________________
Name:
Title:
GRAND STREET HOLDINGS 7, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:_________________________________
Name:
Title:
GRAND STREET HOLDINGS 8, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:_________________________________
Name:
Title:
GRAND STREET HOLDINGS 9, LLC by
Oaktree Capital Management, LLC, its
Managing Member
By:_________________________________
Name:
Title:
Term Loan Agreement
GSC RECOVERY II, L.P.
By: GSC Recovery II GP, L.P., its
general partner
By: GSC RII, LLC, its general partner
By: GSCP (NJ) Holdings, L.P., its
sole member
By: GSCP (NJ), Inc., its general partner
By:____________________________________________
Name:
Title:
GSC RECOVERY IIA, L.P.
By: GSC Recovery IIA GP, L.P., its
general partner
By: GSC RII, LLC, its general partner
By: GSCP (NJ) Holdings, L.P., its sole
member
By: GSCP (NJ), Inc., its general partner
By:____________________________________________
Name:
Title:
JPMORGAN CHASE BANK
By:____________________________________________
Name:
Title:
Term Loan Agreement
OCM OPPORTUNITIES FUND III, L.P. by
Oaktree Capital Management, LLC, its
General Partner
By:_________________________________
Name:
Title:
O'CONNOR DISTRESSED TRADING
MASTER LTD., by UBS O'Connor LLC,
its investment advisor
By:_________________________________
Name:
Title:
PERRY PRINCIPALS, L.L.C.
By:_________________________________
Name:
Title:
ROYAL BANK OF SCOTLAND, PLC
By:_________________________________
Name:
Title:
SOCIETE GENERALE
By:_________________________________
Name:
Title:
Term Loan Agreement
U.S. BANK NATIONAL ASSOCIATION
By:_________________________________
Name:
Title:
WILLIAM E. SIMON & SONS SPECIAL
SITUATIONS PARTNERS II, L.P.
By:_________________________________
Name:
Title:
Term Loan Agreement
ARTICLE I CERTAIN DEFINITIONS AND INTERPRETATION ........................... 2
1.1 Defined Terms ...................................................... 2
1.2 Other Interpretive Provisions ...................................... 21
1.3 Accounting Principles .............................................. 21
ARTICLE II LOANS ............................................................ 22
2.1 Amounts of Loans ................................................... 22
2.2 Loan Accounts ...................................................... 22
2.3 Procedure for Borrowing ............................................ 22
2.4 Conversion and Continuation Elections for Borrowing ................ 22
ARTICLE III PREPAYMENTS; PAYMENTS ............................................ 24
3.1 Scheduled Prepayments .............................................. 24
3.2 Mandatory Prepayments .............................................. 24
3.3 Optional Prepayments ............................................... 25
3.4 Interest ........................................................... 26
3.5 Fees ............................................................... 26
3.6 Computation of Fees and Interest ................................... 27
3.7 Payments by the Borrower ........................................... 27
3.8 Sharing of Payments, Etc ........................................... 27
ARTICLE IV GUARANTIES AND COLLATERAL ........................................ 28
4.1 Security Interests; Collateral ..................................... 28
4.2 Guaranties ......................................................... 28
4.3 Collateral Documents ............................................... 30
4.4 Further Assurances ................................................. 30
4.5 Transfer of Assets ................................................. 30
4.6 Collateral Matters ................................................. 31
ARTICLE V PRIORITY OF PAYMENTS, TAXES, YIELD PROTECTION AND ILLEGALITY ..... 31
5.1 Apportionment, Application and Reversal of Payments ................ 31
5.2 Taxes .............................................................. 32
5.3 Illegality ......................................................... 33
5.4 Increased Costs and Reduction of Return ............................ 34
5.5 Funding Losses ..................................................... 35
5.6 Inability to Determine Rates ....................................... 35
Term Loan Agreement
i
5.7 Certificates of Lenders ............................................ 35
5.8 Substitution of Lenders ............................................ 36
5.9 Survival ........................................................... 36
ARTICLE VI CONDITIONS PRECEDENT .............................................. 36
6.1 Conditions Precedent ............................................... 36
ARTICLE VII REPRESENTATIONS AND WARRANTIES .................................... 38
7.1 Organization, Etc .................................................. 38
7.2 Authorization; No Conflict ......................................... 38
7.3 Validity and Binding Nature ........................................ 38
7.4 Financial Statements ............................................... 39
7.5 No Material Adverse Effect ......................................... 39
7.6 Litigation and Contingent Liabilities .............................. 39
7.7 Liens .............................................................. 40
7.8 Subsidiaries ....................................................... 40
7.9 Pension and Welfare Plans .......................................... 40
7.10 Regulated Industry ................................................. 40
7.11 Regulations T, U and X ............................................. 40
7.12 Taxes .............................................................. 40
7.13 Environmental and Safety Matters ................................... 41
7.14 Compliance with Law ................................................ 41
7.15 Information ........................................................ 41
7.16 Ownership of Properties ............................................ 42
7.17 Patents, Trademarks, Etc ........................................... 42
7.18 Insurance .......................................................... 42
7.20 Secured Obligations ................................................ 42
7.21 Investment Business ................................................ 43
ARTICLE VIII COVENANTS ......................................................... 43
8.1 Reports, Certificates and Other Information ........................ 43
8.2 Books, Records and Inspections ..................................... 45
8.3 Insurance .......................................................... 45
8.4 Compliance with Law; Payment of Taxes and Liabilities .............. 45
8.5 Maintenance of Existence, Etc ...................................... 45
8.6 Financial Ratios and Restrictions .................................. 46
Term Loan Agreement
ii
8.7 Mergers, Consolidations and Purchases .......................................... 47
8.8 Commercial Paper ............................................................... 47
8.9 Liens .......................................................................... 47
8.10 Reserved ....................................................................... 47
8.11 Maintenance of Property ........................................................ 47
8.12 Employee Benefit Plans ......................................................... 47
8.13 Business Activities ............................................................ 47
8.14 Environmental Matters .......................................................... 47
8.15 Unconditional Purchase Obligations ............................................. 48
8.16 Inconsistent Agreements ........................................................ 48
8.17 Transactions with Affiliates ................................................... 48
8.18 The Borrower's and Subsidiaries' Stock ......................................... 48
8.19 Restrictive Agreements ......................................................... 48
8.20 Sales of Assets ................................................................ 49
8.21 Loans and Investments .......................................................... 49
8.22 Limitation on Debt and Subsidiary Debt ......................................... 50
8.23 Restricted Payments ............................................................ 50
8.24 Loan Notes ..................................................................... 50
ARTICLE IX EVENTS OF DEFAULT AND THEIR EFFECT ............................................ 51
9.1 Events of Default .............................................................. 51
9.2 Effect of Event of Default ..................................................... 53
ARTICLE X THE ADMINISTRATIVE AGENT AND COLLATERAL AGENTS ................................ 54
10.1 Appointment and Authorization; Administrative Agent; Collateral Agents ......... 54
10.2 Delegation of Duties ........................................................... 54
10.3 Liability of Agents ............................................................ 54
10.4 Reliance by Agents; Rights to Specific Indemnification ......................... 55
10.5 Notice of Default .............................................................. 55
10.6 Credit Decision ................................................................ 55
10.7 Indemnification of Agents ...................................................... 56
10.8 Bank of America and RBS in Individual Capacity ................................. 56
10.9 Successor Agents ............................................................... 57
10.10 Withholding Tax ................................................................ 57
Term Loan Agreement
iii
ARTICLE XI MISCELLANEOUS .................................................... 59
11.1 Amendments and Waivers ............................................. 59
11.2 Notices ............................................................ 61
11.3 No Waiver; Cumulative Remedies ..................................... 61
11.4 Costs, Expenses and Taxes .......................................... 62
11.5 Borrower Indemnification ........................................... 62
11.6 Payments Set Aside ................................................. 63
11.7 Successors and Assigns ............................................. 63
11.8 Assignments, Participations, Etc ................................... 63
11.9 Confidentiality .................................................... 64
11.10 Set-off ............................................................ 65
11.11 Notification of Addresses, Lending Offices, Etc .................... 65
11.12 Counterparts ....................................................... 65
11.13 Severability ....................................................... 65
11.14 No Third Parties Benefited ......................................... 66
11.15 Nonliability of Lenders ............................................ 66
11.16 Power of Attorney .................................................. 66
11.17 Governing Law ...................................................... 67
11.18 Forum Selection and Consent to Jurisdiction ........................ 67
11.19 Waiver of Jury Trial ............................................... 67
11.20 Judgment ........................................................... 68
11.21 Entire Agreement ................................................... 68
Term Loan Agreement
iv
SCHEDULES
Schedule 1.1 Companies Parties to Debenture
Schedule 1.2 Disclosure Schedule
Item 1.1 Dissolution Subsidiaries
Item 7.6 Litigation
Item 7.8 Subsidiaries
Item 7.13 Environmental Matters
Item 7.14 Compliance with Laws
Item 7.16 Ownership of Properties
Item 7.18 Insurance
Schedule 1.3 Guarantors
Schedule 1.4 Non-U.S. Security Documents
Schedule 2.1 Allocations of Loans
Schedule 4.3 Excluded Subsidiaries
Schedule 8.6 Financial Covenants
Schedule 8.22 Debt Under Capital Leases
Schedule 11.2 Lending Offices
EXHIBITS
Exhibit A Form of Note
Exhibit B Form of Assignment and Acceptance Agreement
Exhibit C Form of Notice of Conversion / Continuation
Exhibit D Form of Compliance Certificate
Exhibit E Form of Intercreditor Agreement
Exhibit F Form of Opinion of Counsel to Borrower
Exhibit G Form of Opinion of Counsel to Guarantors
Exhibit H Form of Subordination Agreement
Exhibit I Form of Amendment and Confirmation
v