EXHIBIT 10.1
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
AMONG
THE SHAW GROUP INC.,
AS THE BORROWER,
BANC ONE CAPITAL MARKETS, INC.,
AS LEAD ARRANGER AND
SOLE BOOK RUNNER
BANK ONE, NA,
AS A LENDER, AS ISSUER AND AS AGENT
AND
U.S. BANK NATIONAL ASSOCIATION,
AS SYNDICATION AGENT AND AS A LENDER
CREDIT LYONNAIS NEW YORK BRANCH,
AS DOCUMENTATION AGENT AND AS A LENDER
UNION PLANTERS BANK, N.A.,
AS CO-AGENT AND AS A LENDER
THE OTHER LENDERS SIGNATORY HERETO
$350,000,000 FACILITY
TABLE OF CONTENTS
<Table>
ARTICLE I DEFINITIONS.........................................................1
ARTICLE II THE CREDITS.......................................................18
2.1 Commitments......................................................18
2.2 Required Payments, Termination...................................21
2.3 Ratable Loans....................................................22
2.4 Types of Advances................................................22
2.5 Commitment Fee, Reductions in Aggregate Commitment...............22
2.6 Minimum Amount of Each Advance...................................22
2.7 Optional Principal Payments......................................22
2.8 Method of Selecting Types and Interest Periods for New Advances..23
2.9 Conversion and Continuation of Outstanding Advances..............23
2.10 Change in Interest Rate, etc.....................................24
2.11 Rates Applicable After Default...................................24
2.12 Method of Payment................................................25
2.13 Noteless Agreement, Evidence of Indebtedness.....................25
2.14 Telephonic Notices...............................................26
2.15 Interest Payment Dates, Interest and Fee Basis...................26
2.16 Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions............................................27
2.17 Lending Installations............................................27
2.18 Non-Receipt of Funds by the Agent................................27
2.19 Facility LCs.....................................................27
2.20 Replacement of Lender............................................32
ARTICLE III YIELD PROTECTION; TAXES..........................................33
3.1 Yield Protection.................................................33
3.2 Changes in Capital Adequacy Regulations..........................34
3.3 Availability of Types of Advances................................35
3.4 Funding Indemnification..........................................35
3.5 Taxes............................................................35
3.6 Lender Statements; Survival of Indemnity.........................37
3.7 Effect of Yield Protection.......................................38
ARTICLE IV CONDITIONS PRECEDENT..............................................38
4.1 Effectiveness....................................................38
4.2 Each Credit Extension............................................40
4.3 Reaffirmations of Warranties.....................................40
ARTICLE V REPRESENTATIONS AND WARRANTIES.....................................41
5.1 Existence and Standing...........................................41
5.2 Authorization and Validity.......................................41
5.3 No Conflict; Government Consent..................................41
5.4 Financial Statements.............................................42
5.5 Material Adverse Change..........................................42
5.6 Taxes............................................................42
5.7 Litigation and Contingent Obligations............................42
5.8 Subsidiaries.....................................................42
5.9 ERISA............................................................43
5.10 Accuracy of Information..........................................43
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<Table>
5.11 Regulation U, T and X...........................................43
5.12 Material Agreements.............................................43
5.13 Compliance With Laws............................................43
5.14 Ownership of Properties.........................................43
5.15 Plan Assets; Prohibited Transactions............................43
5.16 Environmental Matters...........................................44
5.17 Investment Company Act..........................................44
5.18 Public Utility Holding Company Act..............................44
5.19 No Default......................................................44
5.20 Post-Retirement Benefits........................................44
5.21 Insurance.......................................................44
5.22 Solvency........................................................44
5.23 Bond Obligations................................................45
ARTICLE VI COVENANTS........................................................45
6.1 Financial Reporting.............................................45
6.2 Use of Proceeds.................................................47
6.3 Notice of Default...............................................47
6.4 Conduct of Business; Books and Records..........................47
6.5 Taxes...........................................................47
6.6 Insurance.......................................................48
6.7 Compliance with Laws............................................48
6.8 Maintenance of Properties.......................................48
6.9 Inspection......................................................48
6.10 Dividends.......................................................48
6.11 Indebtedness....................................................49
6.12 Merger..........................................................50
6.13 Sale of Assets..................................................50
6.14 Investments and Acquisitions....................................50
6.15 Liens...........................................................51
6.16 Affiliates......................................................52
6.17 Prepayment of Other Indebtedness................................52
6.18 Sale of Accounts................................................52
6.19 Contingent Obligations..........................................53
6.20 Letters of Credit...............................................53
6.21 Financial Contracts.............................................53
6.22 Financial Covenants.............................................53
6.23 Subsidiaries....................................................54
6.24 Acquisitions....................................................54
6.25 Limitation on Leases............................................55
6.26 Intentionally Omitted...........................................55
6.27 Payment on LYONs................................................55
6.28 LYONs Interest Expense..........................................55
6.29 LYONs Indenture.................................................55
ARTICLE VII DEFAULTS........................................................55
</Table>
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<Table>
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES..................58
8.1 Acceleration; Facility LC Collateral Account.....................58
8.2 Amendments.......................................................59
8.3 Preservation of Rights...........................................60
ARTICLE IX GENERAL PROVISIONS................................................61
9.1 Survival of Representations......................................61
9.2 Governmental Regulation..........................................61
9.3 Headings.........................................................61
9.4 Entire Agreement.................................................61
9.5 Several Obligations; Benefits of this Agreement..................61
9.6 Expenses; Indemnification........................................61
9.7 Numbers of Documents.............................................62
9.8 Accounting.......................................................62
9.9 Severability of Provisions.......................................62
9.10 Nonliability of Lenders..........................................62
9.11 Confidentiality..................................................63
9.12 Nonreliance......................................................63
9.13 Disclosure.......................................................63
9.14 Interest.........................................................63
9.15 Excess Share Certificates........................................64
9.16 Survival of Prior Agreements.....................................64
9.17 Guarantor's Acknowledgment and Consent...........................65
ARTICLE X THE AGENT..........................................................65
10.1 Appointment; Nature of Relationship..............................65
10.2 Powers...........................................................66
10.3 General Immunity.................................................66
10.4 No Responsibility for Loans, Recitals, etc.......................66
10.5 Action on Instructions of Lenders................................66
10.6 Employment of Agents and Counsel.................................67
10.7 Reliance on Documents; Counsel...................................67
10.8 Agent's Reimbursement and Indemnification........................67
10.9 Notice of Default................................................68
10.10 Rights as a Lender............................................68
10.11 Lender Credit Decision........................................68
10.12 Successor Agent...............................................68
10.13 Agent's Fee...................................................69
10.14 Delegation to Affiliates......................................69
10.15 Execution of Collateral Documents.............................69
10.16 Collateral Releases...........................................69
10.17 Agents........................................................69
ARTICLE XI SETOFF; RATABLE PAYMENTS..........................................69
11.1 Setoff...........................................................69
11.2 Ratable Payments.................................................70
</Table>
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<Table>
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS................70
12.1 Successors and Assigns...........................................70
12.2 Participations...................................................70
12.3 Assignments......................................................71
12.4 Dissemination of Information.....................................72
12.5 Tax Treatment....................................................73
ARTICLE XIII NOTICES.........................................................73
13.1 Notices..........................................................73
13.2 Change of Address................................................73
ARTICLE XIV COUNTERPARTS.....................................................73
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL......73
15.1 CHOICE OF LAW....................................................73
15.2 CONSENT TO JURISDICTION..........................................74
15.3 WAIVER OF JURY TRIAL.............................................74
</Table>
PRICING SCHEDULE
EXHIBIT 2.13(iv) NOTE
EXHIBIT 4.1(v) FORM OF GUARANTOR'S SOLVENCY CERTIFICATE8
EXHIBIT 4.1(vii) LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
EXHIBIT 6.1(iv) COMPLIANCE CERTIFICATE
EXHIBIT 12.3.1 ASSIGNMENT AGREEMENT
SCHEDULE 4.1(xxv) COVENANT COMPLIANCE CALCULATION
SCHEDULE 5.7 LITIGATION AND CONTINGENT OBLIGATIONS
SCHEDULE 5.8 SUBSIDIARIES
SCHEDULE 5.12 MATERIAL AGREEMENTS
SCHEDULE 5.14 OWNERSHIP OF PROPERTIES; ENCUMBRANCES
SCHEDULE 5.23 BOND OBLIGATIONS
SCHEDULE 6.11(ii) INDEBTEDNESS AND LIENS
SCHEDULE 6.14(ii) SUBSIDIARIES AND OTHER INVESTMENTS
SCHEDULE 6.19(v) CONTINGENT OBLIGATIONS
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This Second Amended and Restated Agreement, dated as of February 28,
2002 (the "Effective Date"), is entered into by and among THE SHAW GROUP INC., a
Louisiana corporation (the "Borrower"), the Subsidiaries of the Borrower listed
on the signature pages hereto as Guarantors (together with each other Person who
subsequently becomes a Guarantor, collectively the "Guarantors"), the banks and
other financial institutions listed on the signature pages hereto under the
caption "Lenders" (together with each other Person who becomes a Lender,
collectively the "Lenders"), BANK ONE, NA, individually as a Lender ("Bank One")
and as administrative agent for the other Lenders (in such capacity together
with any other Person who becomes the agent, the "Agent"), U.S. BANK NATIONAL
ASSOCIATION, formerly known as Firstar Bank, N.A., individually as a Lender and
as syndication agent (the "Syndication Agent"), CREDIT LYONNAIS NEW YORK BRANCH,
individually as a Lender and as documentation agent (the "Documentation Agent")
and UNION PLANTERS BANK, N.A., individually as a Lender and as Co-Agent (the
"Co-Agent" and together with the Agent, the Documentation Agent and the
Syndication Agent the "Agents").
WHEREAS, the Borrower, the Agent and Banc One Capital Markets, Inc., as
Lead Arranger and Sole Book Runner are parties to that certain Credit Agreement
dated July 14, 2000 (as amended, the "July Credit Agreement"); and
WHEREAS, the July Credit Agreement was amended and restated by that
certain Amended and Restated Credit Agreement dated as of the Effective Date (as
defined therein), by and among the Borrower, the Guarantors signatory thereto,
the Lenders signatory thereto and the Agents (the "First Amendment" and,
collectively with the July Credit Agreement, the "Original Amended and Restated
Credit Agreement"); and
WHEREAS, the parties to the Original Amended and Restated Credit
Agreement desire to amend and restate the Original Amended and Restated Credit
Agreement in order to increase the Commitments, add additional Lenders, replace
certain lenders, and to amend certain other provisions of the Original Amended
and Restated Credit Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Accounts" has the meaning stated in the Illinois Uniform Commercial
Code in effect from time to time.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the Effective Date, by which the Borrower
or any of its Subsidiaries (i) acquires from a third party that is not a
Subsidiary any going concern business or all or substantially all of the
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assets of any firm, corporation or limited liability company that is not a
Subsidiary, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires from a third party that is not
a Subsidiary (in one transaction or as the most recent transaction in a series
of transactions) at least a majority (in number of votes) of the securities of a
corporation that is not a Subsidiary which have ordinary voting power for the
election of directors (other than securities having such power only by reason of
the happening of a contingency) or a majority (by percentage or voting power) of
the outstanding ownership interests of a partnership or limited liability
company that is not a Subsidiary.
"Advance" means a borrowing hereunder, (i) in respect of any Loan other
than a Swing Line Loan, (x) made by the Lenders on the same Borrowing Date, or
(y) converted or continued by the Lenders on the same date of conversion or
continuation, consisting, in either case, of the aggregate amount of the several
Loans of the same Type and, in the case of Eurodollar Loans, for the same
Interest Period, and (ii) in respect of a Swing Line Loan, a borrowing made by
the Swing Line Lender.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One, NA in its capacity as contractual
representative of the Lenders pursuant to Article X, and not in its individual
capacity as a Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the total of the Revolving Credit
Commitment of all the Lenders (including the Swing Line Lender's Swing Line
Commitment), and the Facility LC Commitment of all of the Lenders, in each case,
as reduced from time to time pursuant to the terms hereof, which aggregate
amounts as of the Effective Date are a maximum of $350,000,000.
"Aggregate Facility LC Commitment" means the sum of all of the Lenders'
Facility LC Commitments, which totals a maximum of $350,000,000 as of the
Effective Date.
"Aggregate Revolving Credit Commitment" means the sum of all of the
Lenders' Revolving Credit Commitments, which, subject to the limitations of the
Aggregate Commitment, total a maximum of $350,000,000 as of the Effective Date,
reducing from time to time as set forth herein, or as the same may be increased
pursuant to Section 2.1.1(b) hereof.
"Aggregate Outstanding Credit Exposure" means, at any time, the
aggregate of the Outstanding Credit Exposure of all the Lenders (including the
Swing Line Lender).
"Agreement" means this credit agreement, as it may be renewed,
extended, amended, restated or modified and in effect from time to time.
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"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the sum
of the Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Fee Rate" means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the unused portion of the Aggregate
Commitment at such time as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Arranger" means Banc One Capital Markets, Inc., a Delaware
corporation, and its successors.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the President, Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer of the Borrower,
Corporate Comptroller, Treasurer, General Counsel or Senior Vice President.
"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Bank One" means Bank One, NA, in its individual capacity, and its
successors and assigns.
"Borrower" means The Shaw Group Inc., a Louisiana corporation, and its
successors and assigns.
"Borrowing Date" means a date on which a Credit Extension is made
hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means a day (other than a Saturday or Sunday) on which
banks generally are open in Chicago, Illinois for the conduct of substantially
all of their commercial lending activities and on which dealings in United
States dollars are carried on in the London interbank market.
"Calculation Period" means a four quarter period ending on the date of
the Borrower's fiscal quarter end or fiscal year end for which the relevant
calculation is being made.
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"Capital Expenditures" means, without duplication, any expenditures for
any purchase or other acquisition of any asset which would be classified as a
fixed or capital asset on a consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with Agreement Accounting Principles.
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Cash Equivalent Investments" means (i) short-term obligations of, or
fully guaranteed by, the United States of America, (ii) commercial paper rated
A-1 or better by S&P or P-1 or better by Moody's, (iii) demand deposit accounts
maintained in the ordinary course of business, (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000, (v) investments in
Eurodollars not in excess of $5,000,000 in the aggregate at any one time
outstanding, issued by any bank or trust company having capital, surplus and
undivided profits aggregating at least $100,000,000 and whose long term
certificates of deposit are, at the time of acquisition thereof by Borrower or
any Subsidiary, rated A-1 or better by Standard & Poor's Ratings Group or P-1 or
better by Moody's Investor Service, Inc., and (vi) investments by Foreign
Subsidiaries in short term investments, in connection with the cash management
programs of such Foreign Subsidiaries, provided the total of such investments
does not exceed $10,000,000 at any one time outstanding; provided in each case
that the same provides for payment of both principal and interest (and not
principal alone or interest alone) and is not subject to any contingency
regarding the payment of principal or interest.
"Change" has the meaning specified in Section 3.2.
"Change in Control" means an event or series of events by which (a) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act
as in effect on the Effective Date or related persons constituting a "group" (as
such term is used in Rule 13d-5 under the Exchange Act in effect on the
Effective Date) is or becomes or has the absolute, unconditional right to become
the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, as in effect on the Effective Date), directly or indirectly, of 25% or more
of the total voting power of the voting stock of the Borrower; (b) the Borrower
consolidates with or merges into another Person or conveys, transfers or leases
all or substantially all of its assets to any Person, or any Person consolidates
with, or merges into, the Borrower in a transaction not otherwise permitted
hereunder; (c) the Borrower conveys, transfers or leases all or substantially
all of its assets to any Person; (d) the stockholders of the Borrower approve
any plan of liquidation or dissolution of the Borrower; or (e) during any period
of twelve consecutive months, individuals who, at the beginning of such period,
constituted the board of directors of the Borrower (together with any new
director whose election by the Borrower's board of directors or whose nomination
for election by the Borrower's stockholders was approved by a vote of at least a
majority of the directors then still in office who either were directors at the
beginning of such period or whose
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election or nomination for election was previously so approved) cease for any
reason (other than due to death or disability) to constitute a majority of the
board of directors of the Borrower then in office.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral" means the accounts, inventory, intellectual property,
contracts, general intangibles, stock and all other items described as
collateral in any of the Collateral Documents, plus all proceeds thereof, but
excluding all real estate, PP&E.
"Collateral Documents" means, collectively, any and all documents
executed as security for the Obligations, as the same may be amended and as the
same are ratified by that certain Ratification of Collateral Documents,
including without limitation the following documents: (i) security and pledge
agreement executed by Borrower and the Guarantors creating (A) a first and prior
lien in favor of the Agent for the ratable benefit of the Lenders on all of such
Persons' Accounts, Inventory, General Intangibles, the proceeds and products
thereof and all other personal property, including, without limitation, all
inter-company notes and receivables and (B) a first and prior lien in favor of
the Agent for the ratable benefit of the Lenders on, among other collateral, all
of the issued and outstanding shares of the Borrower's or such Guarantor's
Domestic Subsidiaries and 66% of the issued and outstanding shares of the
Borrower's or such Guarantor's foreign Subsidiaries that are owned by Borrower
or a Domestic Subsidiary, together with any security and pledge agreement to be
executed by the Borrower or any Guarantor and delivered to the Agent pursuant to
Section 6.24 hereof, (ii) the Guaranty, (iii) Uniform Commercial Code financing
statements executed by the Borrower and the Guarantors relating to the above
described security and pledge agreements, (iv) stock powers executed in blank by
the Borrower and any Guarantor, as applicable, relating to the shares of stock
of its Subsidiaries pledged by the above described security and pledge
agreements, and (v) stock certificates for all of Borrowers' and its
Subsidiaries' shares of stock pledged by the above described security and pledge
agreements.
"Collateral Shortfall Amount" has the meaning specified in Section 8.1.
"Commitment" means, for each Lender, the Revolving Credit Commitment
and the Facility LC Commitment for such Lender.
"Consolidated Interest Expense" means, for any Person, with reference
to any period, the actual interest expense of such Person and its Subsidiaries
calculated on a consolidated basis for such period excluding any amortization of
financing fees incurred in connection with this Agreement and excluding any non
cash interest expense related to the LYONs.
"Consolidated Net Income" means, for any Person, with reference to any
period, the net income (or loss) of such Person and its Subsidiaries calculated
according to Agreement Accounting Principles on a consolidated basis for such
period, excluding any such net income attributable to any Investment in any
Person that is not a Subsidiary except to the extent of cash distributions from
such Person to the Borrower or its Subsidiaries.
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"Consolidated Net Worth" means at any time the consolidated
stockholders' equity of the Borrower and its Subsidiaries calculated on a
consolidated basis as of such time plus any preferred stock of the Borrower and
its Subsidiaries to the extent it has not been redeemed for indebtedness, as
determined in accordance with Agreement Accounting Principles.
"Consolidated Total Debt" means at any time, all Indebtedness, and all
Contingent Obligations that are interest bearing or to which interest is
attributable or to which interest accrues, including guarantees and Financial
Letters of Credit.
"Consolidated Total Net Cash" means the sum of accounts in accordance
with Agreement Accounting Principles classified as (i) cash or cash equivalents,
(ii) marketable securities, or (iii) other cash equivalent investments, minus
consolidated total debt.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any limited recourse or recourse
note or other obligation, comfort letter, operating agreement, take-or-pay
contract or the obligations of any such Person as general partner of a
partnership with respect to the liabilities of the partnership, but excluding
contingent liabilities in respect of Performance Letters of Credit.
"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
of its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Conversion/Continuation Notice" has the meaning specified in Section
2.9.
"Corporate Base Rate" means a rate per annum equal to the corporate
base rate of interest announced by the Agent from time to time, changing when
and as said corporate base rate changes.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC hereunder.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Default" means an event described in Article VII.
"Domestic Subsidiary" means every Subsidiary of Borrower that is formed
under the laws of the United States of America or any state.
"EBITDA" means, for any Person for any period, the consolidated Net
Income of such Person for that period plus, to the extent deducted from revenues
in determining Consolidated Net Income, (i) Consolidated Interest Expense, (ii)
expense for taxes paid or accrued, (iii)
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depreciation, (iv) amortization and (v) extraordinary non-recurring losses,
minus, to the extent included in Consolidated Net Income, extraordinary
non-recurring gains, all calculated on a consolidated basis.
"Effective Date" has the meaning given in the preamble hereto.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
(i) the protection of the environment, (ii) the effect of the environment on
human health, (iii) emissions, discharges or releases of pollutants,
contaminants, hazardous substances or wastes into surface water, ground water or
land, or (iv) the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, hazardous
substances or wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the rate determined by the Agent to be the rate at
which the Agent offers to place deposits in U.S. dollars with first class banks
in the London interbank market or, at Agent's election, as appear on Reuters
Screen FRBD as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, in the approximate amount of the Agent's relevant
Eurodollar Loan and having a maturity equal to such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin; provided, that in no event shall the Eurodollar Rate
exceed the Highest Lawful Rate. The Eurodollar Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another
document is specifically referenced.
"Facility LC" has the meaning specified in Section 2.19.1.
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"Facility LC Application" has the meaning specified in Section 2.19.3.
"Facility LC Collateral Account" has the meaning specified in Section
2.19.11.
"Facility LC Commitment" means the Commitment of each Lender to
participate in Facility LCs issued by the Issuer in the amount not exceeding
that set forth opposite its signature below or as set forth in any assignment
executed pursuant to Section 12.3.1, as modified from time to time pursuant to
the terms hereof.
"Facility Termination Date" means July 14, 2003 or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, (ii) any agreements, devices or
arrangements providing for payments related to fluctuations of interest rates,
exchange rates, forward rates or commodity prices, including, but not limited
to, interest rate swap or exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, or (iii) any other similar contract.
"Financial Letter of Credit" means a Letter of Credit qualifying as a
"financial guarantee-type letter of credit" under 12 CFR Part 3, Appendix A,
Section 3(b)(1)(i) or any successor U.S. Comptroller of the Currency regulation
and issued by an Issuing Bank under the terms of this Agreement.
"Fixed Charge Coverage Ratio" has the meaning specified in Section
6.22.2.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes; provided, that in no event
shall the Floating Rate exceed the Highest Lawful Rate.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided
in Section 2.11, bears interest at the Floating Rate.
-8-
"Foreign Subsidiary" means any Subsidiary of Borrower that is organized
under the laws of any jurisdiction other than the United States of America or a
state thereof.
"General Intangibles" has the meaning stated in the Illinois Uniform
Commercial Code in effect from time to time including, without limitation, all
contract rights, rights to receive payments of money, chooses in action, causes
of action, judgments, tax refunds and tax refund claims, patents, trademarks,
trade names, copyrights, licenses, franchises, computer programs, software,
goodwill, customer and supplier contracts, interests in general or limited
partnerships, joint ventures or limited liability companies, reversionary
interests in pension and profit sharing plans and reversionary, beneficial and
residual interests in trusts, leasehold interests in real or personal property,
rights to receive rentals of real or personal property and guarantee and
indemnity claims.
"Guarantors" means collectively all of the Borrower's Domestic
Subsidiaries as of the Effective Date and any other Domestic Subsidiary of
Borrower that shall become a guarantor hereunder pursuant to Section 6.23.
"Guaranty" means that certain Guaranty dated as of July 14, 2000
executed by the Guarantors in favor of the Agent, for the ratable benefit of the
Lenders, as ratified by that certain Ratification of Guaranty dated as of the
Effective Date, and each guaranty executed pursuant to Section 6.23 hereof, as
each of such may be amended or modified and in effect from time to time.
"Highest Lawful Rate" means, with respect to each Lender, the maximum
nonusurious interest rate, if any, that at any time or from time to time may be
contracted for, taken, reserved, charged or received on the Notes or on other
Indebtedness under laws applicable to such Lender which are presently in effect
or, to the extent allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
"Indebtedness" of a Person means, without duplication, such Person's
(i) obligations for borrowed money, (ii) obligations representing the deferred
purchase price of Property or services (other than accounts payable arising in
the ordinary course of such Person's business payable on terms customary in the
trade in the applicable jurisdiction), (iii) obligations, whether or not
assumed, secured by Liens or payable out of the proceeds or production from
Property now or hereafter owned or acquired by such Person, (iv) obligations
which are evidenced by notes, acceptances, or other instruments, (v) obligations
of such Person to purchase or repurchase securities, accounts or other Property
arising out of or in connection with the sale of the same or substantially
similar securities or Property, (vi) Capitalized Lease Obligations, (vii)
liabilities under other financings or so-called "synthetic" lease transactions,
(viii) net, mark to market obligations owing under any swaps, hedging
agreements, puts, calls, collars, or similar derivative instruments or
agreements, (ix) reimbursement obligations in respect of Financial Letters of
Credit and (x) any other obligation for borrowed money which in accordance with
Agreement Accounting Principles would be shown as a liability on the
consolidated balance sheet of such Person.
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"Interest Period" means, with respect to a Eurodollar Advance, a period
of seven (7) days, or one, two, three or six months commencing on a Business Day
selected by the Borrower pursuant to this Agreement. Such Interest Period shall
end on the day which corresponds numerically to such date one, two, three or six
months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on
the immediately preceding Business Day. Notwithstanding the foregoing, the
Eurodollar Rate for Interest Periods longer than seven (7) days will not be made
available until the earlier of (i) Agent's determination that syndication of the
Aggregate Commitment is complete or (ii) ninety (90) days following the
Effective Date, unless Agent in its sole discretion determines otherwise.
"Inventory" has the meaning stated in the Illinois Uniform Commercial
Code in effect from time to time, including, without limitation, all goods held
for sale or lease, or furnished or to be furnished under contracts of service,
or consumed in the applicable party's business, raw materials, intermediates,
work in process, packaging materials, finished goods, semi-finished inventory,
scrap inventory, manufacturing supplies and spare parts (to the extent not
covered by purchase money liens of manufacturers), all such goods that have been
returned to or repossessed by or on behalf of the Borrower, and all such goods
released to the Borrower or to third parties under trust receipts or similar
documents.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than Accounts arising
in the ordinary course of business on terms customary in the trade in the
applicable jurisdiction) or contribution of capital by such Person; stocks,
bonds, mutual funds, partnership interests, notes, debentures or other
securities owned by such Person; any deposit accounts and certificate of deposit
owned by such Person; and structured notes, derivative financial instruments and
other similar instruments or contracts owned by such Person.
"Issuer" means Bank One or any Lender (or any subsidiary or affiliate
designated by Bank One) in its capacity as issuer of Facility LCs hereunder.
"LC Fee" is defined in Section 2.19.4.
"LC Obligations" means, at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs outstanding at
such time, plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations.
"LC Payment Date" has the meaning specified in Section 2.19.5.
"LYONs" has the meaning specified in Section 6.11(ix).
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
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"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on the signature pages hereof or on a Schedule or otherwise selected by such
Lender or the Agent pursuant to Section 2.17.
"Letter of Credit" of a Person means a letter of credit which is issued
upon the application of such Person or upon which such Person is an account
party or for which such Person is in any way liable.
"Leverage Ratio" has the meaning specified in Section 6.22.1.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's loan made
pursuant to Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, the Collateral Documents, the
Facility LC Applications and any Notes issued pursuant to Section 2.13, all
documents required under Article IV, and all other documents and instruments
executed in connection with this Agreement.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party, or (iii) the validity or enforceability of any of the Loan
Documents or the rights or remedies of the Agent, the LC Issuer or the Lenders
thereunder.
"Material Indebtedness" has the meaning specified in Section 7.5.
"Material Subsidiary" shall mean a Subsidiary of Borrower having: (i)
assets of $500,000 or more or (ii) annual cash flow of $500,000 or more.
"Modify" and "Modification" have the meaning specified in Section
2.19.1.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Non-U.S. Lender" has the meaning specified in Section 3.5(iv).
"Note" means any promissory note issued at the request of a Lender
pursuant to Section 2.13(iv) in the form of Exhibit 2.13(iv).
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, Swing Line Loans, all Reimbursement Obligations, Rate
Hedging Obligations all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the
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Borrower to the Lenders or to any Lender, the Agent, the Issuer or any
indemnified party arising under the Loan Documents.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Outstanding Credit Exposure" means (i) as to any Lender at any time,
the sum of (x) the aggregate principal amount of its Loans outstanding at such
time, plus (y) an amount equal to its Pro Rata Share of the LC Obligations at
such time, and (ii) as to the Swing Line Lender only, at any time, the aggregate
principal amount of outstanding Swing Line Loans at such time.
"Other Taxes" has the meaning specified in Section 3.5(ii).
"Participants" has the meaning specified in Section 12.2.1.
"Payment Date" means the last Business Day of each month of March,
June, September and December from and including the Effective Date through and
including the Facility Termination Date.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Performance Letter of Credit" means a Letter of Credit qualifying as a
"performance-based standby letter of credit" under 12 CFR Part 3, Appendix A,
Section 3(b)(2)(i) or any successor U.S. Comptroller of the Currency regulation
and issued by an Issuing Bank under the terms of this Agreement.
"Permitted Business" means the businesses of Borrower and its
Subsidiaries carried on as of the Effective Date and any businesses, services or
activities incident or related thereto.
"Permitted Business Investments" means:
(i) loans and other extensions of credit to officers,
directors and employees of Borrower or any Subsidiary
for travel, entertainment, moving and similar
expenses or advances made in direct furtherance and
in the ordinary course of the business of Borrower or
the Subsidiaries, provided that the aggregate
principal amount of loans and other extensions of
credit made pursuant to this clause (i) does not
exceed $1,500,000 at any one time outstanding;
(ii) loans to employees for signing bonuses in the
ordinary course of business of Borrower and its
Subsidiaries;
(iii) Investments in joint ventures operating a Permitted
Business not to exceed 5% of Borrower's Consolidated
Net Worth unless such Investment could reasonably be
expected to have a Material Adverse Effect;
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(iv) Loans and other extensions of credit to an officer of
employee of Borrower or a Subsidiary extended in
connection with hiring that Person that is the
functional equivalent of a signing bonus and is to be
forgiven over time if said Person continues his or
her employment;
(v) Investments by Foreign Subsidiaries in other Foreign
Subsidiaries;
(vi) Investments by Borrower in Domestic Subsidiaries and
Investments by Domestic Subsidiaries in Borrower; and
(vii) Investments by Borrower in Foreign Subsidiaries,
which Investments are effected after July 14, 2000,
such Investments not to exceed $10,000,000 in the
aggregate outstanding at any one time, and to be
evidenced by a promissory note or other similar
document that is pledged to the Agent as Collateral;
(viii) Investments by Subsidiaries in Borrower; and
"Permitted Financial Investments" means the following kinds of
instruments:
(i) receivables arising from the sale of goods and
services in the ordinary course of business of
Borrower or any Subsidiaries;
(ii) currency or commodity price hedging agreements, using
customary ISDA swap documentation or comparable
documentation, entered into with a Lender for the
purpose of hedging actual exposure on the currency or
commodity price risks of its business and not
speculation;
(iii) Capital Stock or obligations or securities received
in settlement of debts (created in the ordinary
course of business) owing to Borrower or any
Subsidiary; and
(iv) Investments in Capital Stock of publicly traded
companies provided the aggregate Investment therein
does not ever exceed $10,000,000 if Consolidated
Total Net Cash is at least $75,000,000; otherwise the
aggregate Investment thereon shall not exceed
$2,500,000.
"Permitted Indebtedness" shall mean without duplication (i) deferred
taxes and other expenses incurred in the ordinary course of business; (ii)
Indebtedness of a Domestic Subsidiary to Borrower or another Domestic
Subsidiary; (iii) Indebtedness of a Foreign Subsidiary to a Foreign Subsidiary;
(iv) Indebtedness of Borrower to a Domestic Subsidiary or a Foreign Subsidiary,
so long as such Indebtedness is subordinated to all of Borrower's or its
Subsidiaries' Indebtedness to Lenders pursuant to the Subordination Agreement;
and (v) Indebtedness constituting the net obligations of a Person as of the date
of a required calculation under currency or commodity hedging agreements entered
into with one of the Lenders in the ordinary course of business and not for the
purposes of speculation.
"Permitted Liens" means any of the following:
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(i) Liens for taxes, assessments or governmental charges
or levies on its Property if the same shall not at
the time be delinquent or thereafter can be paid
without penalty, or are being contested in good faith
and by appropriate proceedings and for which adequate
reserves in accordance with Agreement Accounting
Principles shall have been set aside on its books;
(ii) Liens imposed by law, such as carriers',
warehousemen's and mechanics' liens and other similar
liens arising in the ordinary course of business
which secure payment of obligations not more than 60
days past due or which are being contested in good
faith by appropriate proceedings and for which
adequate reserves shall have been set aside on its
books;
(iii) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance,
old age pensions, or other social security or
retirement benefits, or similar legislation;
(iv) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations
of a like nature, in each case in the ordinary course
of business;
(v) utility easements, building and zoning restrictions,
minor defects or irregularities in title and such
other encumbrances or charges against real property
as are of a nature generally existing with respect to
properties of a similar character and which do not in
any material way adversely affect the marketability
of the same or interfere with the use thereof in the
business of the Borrower or its Subsidiaries;
(vi) judgment and attachment liens not giving rise to a
Default or liens created by or existing from any
litigation or legal proceeding that are being
contested in good faith by appropriate proceedings,
promptly instituted and diligently conducted, and for
which adequate reserves have been made to the extent
required by Agreement Accounting Principles in
respect of a claim not to exceed $500,000;
(vii) liens in favor of collecting or payor banks having a
right of setoff, revocation, refund or chargeback in
favor of collecting or payor banks with respect to
money or instruments of the Borrower or any of its
Subsidiaries on deposit with or in possession of such
bank; and
(viii) customary set off rights and related financial
settlement procedures under Rate Hedging Obligations
entered into for the purpose of hedging and not for
speculation;
provided, that the term "Permitted Liens" shall not include any Lien securing
Indebtedness.
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"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"Purchasers" has the meaning specified in Section 12.3.1.
"Qualified Stock" means, with respect to any Person, any common stock
of such Person or a Subsidiary of such Person.
"Rate Hedging Agreement" means an agreement, device or arrangement
entered into with any Lender providing for payments which are related to
fluctuations of interest rates, exchange rates or forward rates, including, but
not limited to, dollar-denominated or cross-currency interest rate exchange
agreements, forward currency exchange agreements, interest rate cap or collar
protection agreements, forward rate currency or interest rate options, puts and
warrants.
"Rate Hedging Obligation" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Hedging Agreements, and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any Rate Hedging Agreement.
"Refunded Swing Line Loans" has the meaning specified in Section
2.1.2(ii).
"Regulations U, T and X" means the corresponding regulation of the
Board of Governors of the Federal Reserve System as from time to time in effect
and any successor or other regulation or official interpretation of said Board
of Governors, and all official rulings and interpretations thereunder or
thereof.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.19 to reimburse the
Issuer for amounts paid by the Issuer in respect of any one or more drawings
under Facility LCs.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA
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that it be notified within 30 days of the occurrence of such event, provided,
however, that a failure to meet the minimum funding standard of Section 412 of
the Code and of Section 302 of ERISA shall be a Reportable Event regardless of
the issuance of any such waiver of the notice requirement in accordance with
either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Reports" has the meaning specified in Section 9.6.
"Required Lenders" means Lenders in the aggregate having at least 51%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 51% of the aggregate Outstanding
Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Credit Commitment" means, for each Lender, the obligation of
such Lender to make Revolving Credit Loans, other than Swing Line Loans, to
Borrower in an amount not exceeding the amount set forth opposite its signature
below or as set forth in any assignment executed pursuant to Section 12.3.1, as
modified from time to time pursuant to the terms hereof.
"Revolving Credit Loan" means a loan made under Section 2.1 or Section
2.2, but shall not include a participation in a Facility LC.
"Schedule" refers to a specific schedule to this Agreement, unless
another document is specifically referenced.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Obligations" means the Obligations.
"Shaw EBITDA" means, for any period, EBITDA for the Borrower and its
Subsidiaries. For purposes of calculating the Leverage Ratio only, in
calculation of Shaw EBITDA, (i) for any Acquisition permitted hereunder by
Borrower or a Subsidiary of any Person or assets during a Calculation Period for
which EBITDA is calculated (a) the EBITDA of said Person or assets for the
trailing twelve (12) months immediately preceding the Acquisition shall be
included in the first such calculation with respect to said Person or assets and
(b) in any subsequent calculation, to the extent such Person or asset's EBITDA
is not consolidated with Borrower's under Agreement Accounting Principles for a
full Calculation Period, the actual EBITDA of such Person or assets for the most
recent period prior to the time it was acquired by Borrower or a Subsidiary
shall be added to the EBITDA of Borrower to reach a total of a full Calculation
Period's EBITDA for such Person or assets being a part of the calculation of
Borrower's EBITDA; and (ii) Shaw EBITDA shall be reduced by EBITDA attributable
to any assets sold during the applicable Calculation Period.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
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"Standby Facility LC" means Facility LC which is issued as a standby
letter of credit.
"Subordination Agreement" means the Intercompany Subordination among
the Borrower, all Foreign Subsidiaries and Domestic Subsidiaries and the Agent
dated as of July 14, 2000.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the
Borrower and its Subsidiaries, Property which (i) represents more than 10% of
the consolidated assets of the Borrower and its Subsidiaries as would be shown
in the consolidated financial statements of the Borrower and its Subsidiaries as
at the beginning of the twelve-month period ending with the month in which such
determination is made, or (ii) is responsible for more than 10% of the
consolidated net sales or of the consolidated net income of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause (i)
above.
"Swing Line Commitment" means the Swing Line Lender's obligation to
make Swing Line Loans pursuant to Section 2.1.2.
"Swing Line Lender" means Bank One in its capacity as provider of the
Swing Line Loans.
"Swing Line Loan" or "Swing Line Loans" has the meaning specified in
Section 2.1.2.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes.
"Transferee" has the meaning specified in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
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"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1 Commitments.
2.1.1 Loan Commitment.
(a) From and including the Effective Date and prior
to the Facility Termination Date, each Lender severally
agrees, on the terms and conditions set forth in this
Agreement, to (A) make Loans to the Borrower and (B)
participate in Facility LCs issued upon the request of the
Borrower, provided that, after giving effect to the making of
each such Loan and the issuance of each such Facility LC, (i)
such Lender's Outstanding Credit Exposure shall not exceed its
Revolving Credit Commitment; (ii) the total Facility LCs
outstanding shall not exceed the Aggregate Facility LC
Commitment; (iii) the total Revolving Credit Loan outstanding
shall not exceed the Aggregate Revolving Credit Commitment;
and (iv) the Aggregate Outstanding Credit Exposure shall not
exceed the Aggregate Commitment. Subject to the terms of this
Agreement, the Borrower may borrow, repay and reborrow at any
time prior to the Facility Termination Date. All Commitments
shall expire on the Facility Termination Date. The Issuer will
issue Facility LCs hereunder on the terms and conditions set
forth in Section 2.19.
(b) The Borrower may, at its option and subject to
the conditions described in this Section, increase the
Aggregate Commitment one time by increasing the Aggregate
Revolving Credit Commitment to an amount equal to the sum of
the Aggregate Revolving Credit Commitment on the date
immediately preceding the date on which the increase occurs
plus Fifty Million and No/100 Dollars ($50,000,000), or such
lesser amount as the Borrower may specify in the Commitment
Increase Notice. Borrower may exercise its option to so
increase the Aggregate Revolving Credit Commitment only if the
following conditions are satisfied:
(i) no Default or Unmatured Default exists
hereunder, and the Borrower shall have delivered a
certificate to Agent from an officer of Borrower
stating that no Default or Unmatured Default exists;
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(ii) the representations and warranties of
the Borrower contained in Article V shall be true and
correct except to the extent any such representation
or warranty is stated to relate solely to an earlier
date, in which case such representation or warranty
shall have been true and correct on such earlier
date;
(iii) the Guarantors shall have consented to
such increase in writing; and
(iv) the Borrower shall execute new Notes
evidencing the increased Commitments of the Lenders,
at the Lenders' request.
Notwithstanding the foregoing, after giving effect to this Section, (i)
the Aggregate Commitment will not exceed $400,000,000, and (ii) the
terms and conditions hereof shall remain substantially the same as on
the Effective Date. Further, none of the Lenders are obligated to
increase their Commitments to comply with this Section, and no Lender's
Commitment will be increased without written consent from such Lender.
2.1.2 Swing Line Commitment.
(i) Subject to the terms and conditions
hereof, the Swing Line Lender agrees at any time and
from time to time on and after the Effective Date and
prior to the Facility Termination Date, to make Swing
Line loans (each a "Swing Line Loan" and
collectively, the "Swing Line Loans") to the Borrower
in an aggregate principal amount at any one time
outstanding not to exceed $10,000,000, which Swing
Line Loans (x) shall be made and maintained pursuant
to one or more Advances comprised of Floating Rate
Advances and which shall not be entitled to be
converted into Eurodollar Advances, (y) shall be made
in the minimum amount of $100,000 (or if less, in the
aggregate amount of the remaining unused portion of
the Aggregate Revolving Credit Commitment), and (z)
may be repaid and, so long as no Default or Unmatured
Default exists hereunder, reborrowed, at the option
of the Borrower, in accordance with the provisions
hereof. Swing Line Loans shall constitute "Loans" for
all purposes hereunder, except they shall be held by
the Swing Line Lender (subject to Section 2.1.2(ii)
below) and, only for purposes of calculating the
commitment fee under Section 2.5, shall not be
considered a utilization of the Commitment of any
Lender hereunder. Notwithstanding the foregoing, the
Aggregate Outstanding Credit Exposure shall not
exceed the Aggregate Commitment.
(ii) If any Swing Line Loan is not repaid
when due, the Swing Line Lender shall give notice to
the Agent to request each Lender, including the Swing
Line Lender, to make a Loan as a Floating Rate
Advance in an amount equal to the product of such
Lender's Pro Rata Share times the outstanding
principal balance of such Swing Line Loan (the
"Refunded Swing Line Loan") outstanding on the date
such notice is
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given; provided that the provision of this subsection
shall not affect the obligation of the Borrower to
prepay Swing Line Loans in accordance with Section
2.2. Unless the Commitments shall have expired or
terminated, each Lender shall make the proceeds of
such Loan available to the Agent for the account of
the Swing Line Lender on the next Business Day
following such request, in immediately available
funds. The proceeds of such Loans shall be
immediately applied to repay the Refunded Swing Line
Loan.
(iii) At any time before or after a Default
or Unmatured Default, if the Commitments shall have
expired or be terminated while any Swing Line Loan is
outstanding, each Lender, at the sole option of the
Swing Line Lender shall either (A) notwithstanding
the expiration or termination of the Commitments,
make a Loan as a Floating Rate Advance, which such
Loan shall be deemed a "Loan" for all purposes of
this Agreement and the other Loan Documents, or
(B) be deemed, without further action by any Person,
to have purchased from the Swing Line Lender a
participation in such Swing Line Loan, in either case
in an amount equal to the product of such Lender's
Pro Rata Share times the outstanding principal
balance of such Swing Line Loan. The Agent shall
notify each such Lender of the amount of such Loan or
participation, and such Lender will transfer to the
Agent for the account of the Swing Line Lender on the
next Business Day following such notice, in
immediately available funds, the amount of such Loan
or participation.
(iv) If any such Lender shall not have so
made its Loan or its percentage participation
available to the Agent pursuant to this Section
2.1.2, such Lender agrees to pay interest thereon for
each day from such date until the date such amount is
paid at the lesser of (x) the Federal Funds Effective
Rate for such day for the first three days and
thereafter the interest rate applicable to the Loan,
and (y) the Highest Lawful Rate. Whenever, at any
time after the Agent has received from any Lender
such Lender's Loan or participating interest in a
Swing Line Loan, the Agent receives any payment on
account thereof, the Agent will pay to such Lender
its participating interest in such amount
(appropriately adjusted, in the case of interest
payments, to reflect the period of time during which
such Lender's Loan or participating interest was
outstanding and funded), which payment shall be
subject to repayment by such Lender if such payment
received by the Agent is required to be returned.
Each Revolving Credit Lender's obligation to make the
Loans or purchase such participating interests
pursuant to this Section 2.1.2 shall be absolute and
unconditional and shall not be affected by any
circumstance, including, without limitation, (A) any
set-off, counterclaim, recoupment, defense or other
right which such Lender or any other Person may have
against the Swing Line Lender, the Agent or any other
Person for any reason whatsoever; (B) the occurrence
or continuance of a Default or an Unmatured Default
or the termination of the Commitments; (C) the
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occurrence of any Material Adverse Effect; (D) any
breach of this Agreement by the Borrower or any other
Lender; or (E) any other circumstance, happening or
event whatsoever, whether or not similar to any of
the foregoing. Each Swing Line Loan, once so
participated by any Lender, shall cease to be a Swing
Line Loan with respect to that amount for purposes of
this Agreement, but shall continue to be a Loan.
2.2 Required Payments, Termination. The Borrower shall make the
following mandatory payments:
(i) The Aggregate Outstanding Credit Exposure and all
other unpaid Obligations shall be paid in full by the Borrower
on the Facility Termination Date;
(ii) Each Swing Line Loan shall be paid in full on
the fifth Business Day from the date such Swing Line Loan was
made by the Swing Line Lender;
(iii) Notwithstanding anything to the contrary
contained in this Agreement or in any other Loan Document, the
Aggregate Outstanding Credit Exposure shall not exceed the
Aggregate Commitment. The Lenders shall never be required to
make any Advance or issue or participate in any Facility LC,
and the Swing Line Lender shall never be required to make any
Swing Line Loan, that would cause the Aggregate Outstanding
Credit Exposure to exceed the Aggregate Commitment, and no
Lender shall be required to make any Advance or issue or
participate in any Facility LC that would cause such Lender's
Outstanding Credit Exposure to exceed its individual, total
Commitment. If the Aggregate Outstanding Credit Exposure
exceeds the Aggregate Commitment, the Borrower shall
immediately repay the principal of the Revolving Credit Loans
in an amount equal to such excess. If after giving effect to
any such principal repayment there shall be in existence a
Collateral Shortfall Amount, Borrower shall immediately pay to
the Agent such Collateral Shortfall Amount in immediately
available funds, which funds shall be held in the Facility LC
Collateral Shortfall Account.
(iv) Upon the sale of any other asset, including
stock in any of Borrower's Subsidiaries allowed under Section
6.13, for $5,000,000 or more in cash proceeds, the entire
amount of the net cash proceeds resulting therefrom shall be
applied to reduce the outstanding principal balance under the
Revolving Credit Loans, and the Aggregate Revolving Credit
Commitment and the Aggregate Commitment shall both be
automatically and permanently reduced by such amount and the
Revolving Credit Commitment of each Lender shall automatically
reduce by its Pro Rata Share thereof, provided if, at the time
of such sale, the Leverage Ratio, after giving effect to such
sale and paydown, is less than 2.5 to 1.0, there shall be no
such reduction of the Aggregate Commitment or the Aggregate
Revolving Credit Commitment. Any non-cash proceeds received
from such sale shall be pledged as additional Collateral.
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2.3 Ratable Loans. Each Advance hereunder, other than Advance of Swing
Line Loans, shall consist of Loans made from the several Lenders ratably
according to their Pro Rata Shares.
2.4 Types of Advances. The Advances (other than Advances made in
respect of a Swing Line Loan which must be Floating Rate Advances) may be
Floating Rate Advances or Eurodollar Advances, or a combination thereof,
selected by the Borrower in accordance with Section 2.8 and Section 2.9.
2.5 Commitment Fee, Reductions in Aggregate Commitment.
(i) The Borrower agrees to pay to the Agent for the
account of each Lender according to its Pro Rata Share a
commitment fee as determined by the Pricing Schedule on the
average daily unborrowed portion of Aggregate Commitment
payable quarterly in arrears to the Lenders (including the
Agent). The Borrower may permanently reduce the Aggregate
Commitment in whole, or in part ratably among the Lenders in
integral multiples of $10,000,000 (and any such reduction will
reduce the Aggregate Revolving Credit Commitment and the
Aggregate Facility LC Commitment pro tanto), upon at least
three Business Day's written notice to the Agent, which notice
shall specify the amount of any such reduction and which of
the Aggregate Revolving Credit Commitment or the Aggregate
Facility LC Commitment is being reduced, provided, however,
that (i) the amount of the Aggregate Commitment may not be
reduced below the Aggregate Outstanding Credit Exposure; (ii)
the amount of the Aggregate Revolving Credit Commitment shall
not be reduced below the amount of outstanding Revolving
Credit Loans, and, (iii) the Aggregate Facility LC Agreement
shall not be reduced below the amount of the LC Obligations.
All accrued commitment fees shall be payable on the effective
date of any termination of the obligations of the Lenders to
make Credit Extensions hereunder.
(ii) The Aggregate Commitment, the Aggregate
Revolving Credit Commitment, and the corresponding Commitments
of each Lender shall be automatically and permanently reduced
to the extent and in the manner set forth in Section 2.2(iv).
2.6 Minimum Amount of Each Advance. Each Eurodollar Advance shall be in
the minimum amount of $10,000,000 (and in multiples of $500,000 if in excess
thereof), and each Floating Rate Advance other than those constituting Swing
Line Loans, shall be in the minimum amount of $5,000,000 (and in multiples of
$500,000 if in excess thereof), provided, however, that any Floating Rate
Advance may be in the amount of the remaining unused portion of the Aggregate
Revolving Credit Commitment.
2.7 Optional Principal Payments. The Borrower may from time to time pay
or prepay, without penalty or premium, all outstanding Floating Rate Advances,
or, in a minimum aggregate amount of $1,000,000 or any integral multiple of
$100,000 in excess thereof, any portion of the outstanding Floating Rate
Advances upon one Business Day's prior notice to the Agent. The Borrower may
from time to time pay or prepay, subject to the payment of any
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funding indemnification amounts required by Section 3.4 but without penalty or
premium, all outstanding Eurodollar Advances, or, in a minimum aggregate amount
of $5,000,000 or any integral multiple of $1,000,000 in excess thereof, any
portion of the outstanding Eurodollar Advances upon three Business Days' prior
notice to the Agent.
2.8 Method of Selecting Types and Interest Periods for New Advances.
2.8.1 Loans. The Borrower shall select the Type of Advance
and, in the case of each Eurodollar Advance, the Interest Period
applicable thereto from time to time. The Borrower shall give the Agent
irrevocable notice (a "Borrowing Notice") not later than 11:00 a.m.
Chicago time on the Borrowing Date of each Floating Rate Advance and
three Business Days before the Borrowing Date for each Eurodollar
Advance, specifying:
(i) the Borrowing Date, which shall be a
Business Day, of such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance,
the Interest Period applicable thereto.
The Agent shall promptly notify each Lender of the receipt of a
Borrowing Notice. Not later than 2:00 p.m. Chicago time on each
Borrowing Date, each Lender shall make available its Loan or Loans in
funds immediately available in Chicago to the Agent at its address
specified pursuant to Article XIII. The Agent will make the funds so
received from the Lenders available to the Borrower at the Agent's
aforesaid address. The Borrower shall be entitled to have a maximum of
five separate Eurodollar Advances hereunder for all Loans outstanding
at any one time.
2.8.2 Swing Line Loans. Whenever the Borrower requires an
Advance under the Swing Line Loans, it shall give written notice
thereof (or telephonic notice promptly confirmed in writing) to the
Swing Line Lender not later than 11:00 a.m. Chicago, Illinois time on
the date of such Advance. Each notice shall be irrevocable and shall
specify the aggregate principal amount of such Advance and the
Borrowing Date of such Advance (which shall be a Business Day). No
later than 2:00 p.m. Chicago, Illinois time on the requested Date, the
Swing Line Lender shall make available to the Borrower in immediately
available funds the amount of such Advance at the Borrower's general
deposit account maintained with the Swing Line Bank, or as otherwise
directed by the Borrower.
2.9 Conversion and Continuation of Outstanding Advances. Floating Rate
Advances shall continue as Floating Rate Advances unless and until such Floating
Rate Advances are converted into Eurodollar Advances pursuant to this Section
2.9 or are repaid in accordance with Section 2.2 or Section 2.7. Each Eurodollar
Advance shall continue as a Eurodollar Advance until the end of the then
applicable Interest Period therefor, at which time such Eurodollar Advance shall
be automatically converted into a Floating Rate Advance unless (x) such
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Eurodollar Advance is or was repaid in accordance with Section 2.7 or (y) the
Borrower shall have given the Agent a Conversion/Continuation Notice (as defined
below) requesting that, at the end of such Interest Period, such Eurodollar
Advance continue as a Eurodollar Advance for the same or another Interest
Period. Subject to the terms of Section 2.6, the Borrower may elect from time to
time to convert all or any part of a Floating Rate Advance into a Eurodollar
Advance. The Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of a Floating Rate Advance
into a Eurodollar Advance or continuation of a Eurodollar Advance not later than
10:00 a.m. Chicago time at least three Business Days prior to the date of the
requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business
Day, of such conversion or continuation,
(ii) the aggregate amount and Type of the Advance
which is to be converted or continued, and
(iii) the amount of such Advance which is to be
converted into or continued as a Eurodollar Advance and the
duration of the Interest Period applicable thereto.
Advances under the Swing Line Loan shall at all times remain Floating Rate
Advances, and may not be converted into Eurodollar Advances.
2.10 Change in Interest Rate, etc. Each Floating Rate Advance shall
bear interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is automatically converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9, to but
excluding the date it is paid or is converted into a Eurodollar Advance (and on
which date, if a conversion has occurred, the Eurodollar Rate is charged), at a
rate per annum equal to the Floating Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as a Floating Rate Advance
will take effect simultaneously with each change in the Alternate Base Rate or
Applicable Margin, as applicable. Each Eurodollar Advance shall bear interest on
the outstanding principal amount thereof from and including the first day of the
Interest Period applicable thereto to the last day of such Interest Period at
the interest rate determined by the Agent as applicable to such Eurodollar
Advance based upon the Borrower's selections under Section 2.8 and Section 2.9
and otherwise in accordance with the terms hereof. Changes in the rate of
interest on that portion of any Advance maintained as a Eurodollar Advance will
take effect simultaneously with each change in the Applicable Margin regardless
of whether such date falls during an existing Interest Period. No Interest
Period may end after the Facility Termination Date.
2.11 Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.8 or Section 2.9, during the continuance of a
Default or Unmatured Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no
Advance may be made as, converted into or continued as a Eurodollar Advance.
During the continuance of a Default the Required Lenders may, at their option,
by notice to the Borrower
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(which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that (i) each Eurodollar Advance
shall bear interest for the remainder of the applicable Interest Period at the
lesser of (x) the Eurodollar Rate calculated by adding the Applicable Margin for
Level VI (as set forth on the Pricing Schedule) plus 2% per annum and (y) the
Highest Lawful Rate, (ii) each Floating Rate Advance shall bear interest at a
rate per annum equal to the lesser of (x) the Floating Rate calculated by adding
the Applicable Margin for Level VI plus 2% per annum and (y) the Highest Lawful
Rate and (iii) the LC Fee shall be calculated by using the Applicable Margin for
Level VI increased by 2% per annum, provided that, during the continuance of a
Default under Section 7.6 or Section 7.7, the interest rates set forth in
clauses (i) and (ii) above and the increase in the LC Fee set forth in clause
(iii) above shall be applicable to all Credit Extensions without any election or
action on the part of the Agent or any Lender.
2.12 Method of Payment. All payments of the Obligations hereunder shall
be made, without setoff, deduction, or counterclaim, in immediately available
funds to the Agent at the following address: Bank One, NA, One Banc One Plaza,
11th Floor, Chicago, Illinois 60670 (or by wire transfer to the Agent in
accordance with Agent's written instructions), or at any other Lending
Installation of the Agent specified in writing by the Agent to the Borrower, by
noon (local time) on the date when due and shall (except in the case of
Reimbursement Obligations for which the Issuer has not been fully indemnified by
the Lenders, or as otherwise specifically required hereunder) be applied ratably
by the Agent among the Lenders. Each payment delivered to the Agent for the
account of any Lender shall be delivered promptly by the Agent to such Lender in
the same type of funds that the Agent received at its address specified pursuant
to Article XIII or at any Lending Installation specified in a notice received by
the Agent from such Lender. The Agent is hereby authorized to charge the account
of the Borrower maintained with Bank One for each payment of principal,
interest, Reimbursement Obligations and fees as it becomes due hereunder. Each
reference to the Agent in this Section 2.12 shall also be deemed to refer, and
shall apply equally, to the Issuer, in the case of payments required to be made
by the Borrower to the Issuer pursuant to Section 2.19.6.
2.13 Noteless Agreement, Evidence of Indebtedness.
(i) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from
each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid to such
Lender from time to time hereunder.
(ii) The Agent shall also maintain accounts in which
it will record (a) the amount of each Loan made hereunder, the
Type thereof and the Interest Period with respect thereto, (b)
the amount of any principal or interest due and payable or to
become due and payable from the Borrower to each Lender
hereunder, (c) the original stated amount of each Facility LC
and the amount of LC Obligations outstanding at any time, and
(d) the amount of any sum received by the Agent hereunder from
the Borrower and each Lender's share thereof.
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(iii) The entries maintained in the accounts
maintained pursuant to Section 2.13(i) and Section 2.13(ii)
above shall be prima facie evidence of the existence and
amounts of the Obligations therein recorded, provided,
however, that the failure of the Agent or any Lender to
maintain such accounts or any error therein shall not in any
manner affect the obligation of the Borrower to repay the
Obligations in accordance with their terms.
(iv) Any Lender may request that its Loans be
evidenced by a promissory note (a "Note"). In such event, the
Borrower shall prepare, execute and deliver to such Lender a
Note payable to the order of such Lender in the form of
Exhibit 2.13(iv) attached hereto. Thereafter, the Loans
evidenced by such Note and interest thereon shall at all times
(including after any assignment pursuant to Section 12.3) be
represented by one or more Notes payable to the order of the
payee named therein or any assignee pursuant to Section 12.3,
except to the extent that any such Lender or assignee
subsequently returns any such Note for cancellation and
requests that such Loans once again be evidenced as described
in Section 2.13(i) and Section 2.13(ii) above.
2.14 Telephonic Notices. The Borrower hereby authorizes the Lenders and
the Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
2.15 Interest Payment Dates, Interest and Fee Basis. Interest accrued
on each Floating Rate Advance shall be payable on the last day of each calendar
month, commencing with the first such date to occur after the Effective Date, on
any date on which the Floating Rate Advance is prepaid, whether due to
acceleration or otherwise, and at maturity. Interest accrued on that portion of
the outstanding principal amount of any Floating Rate Advance converted into a
Eurodollar Advance on a day other than the last day of any calendar month shall
be payable on the date of conversion. Interest accrued on each Eurodollar
Advance shall be payable in arrears on the last day of its applicable Interest
Period, on any date on which the Eurodollar Advance is prepaid, whether by
acceleration or otherwise, and at maturity. Interest accrued on each Eurodollar
Advance having an Interest Period longer than three months shall also be payable
on the last day of each three-month interval during such Interest Period, and
upon any prepayment. Interest on Floating Rate Advances shall be calculated for
actual days elapsed on the basis of a 365/366-day year. Interest on Eurodollar
Advances, commitment fees and LC Fees shall be calculated for actual days
elapsed on the basis of a 360-day year. Interest shall be payable for the day an
Advance is made but not for the day of any payment on the amount paid if payment
is received prior to noon (local time) at the place of payment. If any payment
of principal of or interest on an Advance shall become due on a day which is not
a Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such
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extension of time shall be included in computing interest in connection with
such payment. Notwithstanding the foregoing, the Borrower will pay to the Agent,
for the account of each Lender, interest at the applicable rate in accordance
with Section 2.11.
2.16 Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Conversion/Continuation Notice, and repayment notice received
by it hereunder. Promptly after notice from the Issuer, the Agent will notify
each Lender of the contents of each request for issuance of a Facility LC
hereunder. The Agent will notify each Lender of the interest rate applicable to
each Eurodollar Advance promptly upon determination of such interest rate and
will give each Lender prompt notice of each change in the Alternate Base Rate.
2.17 Lending Installations. Each Lender may book its Loans and its
participation in any LC Obligations and the Issuer may book the Facility LCs at
any Lending Installation selected by such Lender or the Issuer, as the case may
be, and may change its Lending Installation from time to time. All terms of this
Agreement shall apply to any such Lending Installation and the Loans, Facility
LCs, participations in LC Obligations and any Notes issued hereunder shall be
deemed held by each Lender or the Issuer, as the case may be, for the benefit of
any such Lending Installation. Each Lender and the Issuer may, by written notice
to the Agent and the Borrower in accordance with Article XIII, designate
replacement or additional Lending Installations through which Loans will be made
by it or Facility LCs will be issued by it and for whose account Loan payments
or payments with respect to Facility LCs are to be made.
2.18 Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (x) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
2.19 Facility LCs.
2.19.1 Issuance. The Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue commercial and standby
(both payment or financial and performance) letters of credit (each, a
"Facility LC") and to renew, extend, increase, decrease or otherwise
modify each Facility LC ("Modify," and each such action a
"Modification"), from time to time from and including the Effective
Date and prior to the Facility Termination Date upon the request of the
Borrower; provided that immediately
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after each such Facility LC is issued or Modified, (i) the aggregate
amount of the outstanding LC Obligations shall not exceed the Aggregate
Facility LC Commitment and (ii) the Aggregate Outstanding Credit
Exposure shall not exceed the Aggregate Commitment. No Facility LC
issued on or after the Effective Date shall have an expiry date later
than the earlier of (x) the fifth Business Day prior to the Facility
Termination Date and (y) one year after its issuance; provided that any
Facility LC may provide for the renewal thereof for additional one-year
periods (which shall in no event extend beyond the fifth Business Day
prior to the Facility Termination Date).
2.19.2 Participations. Immediately upon the issuance or
Modification by the Issuer of a Facility LC in accordance with this
Section 2.19, the Issuer shall be deemed, without further action by any
party hereto, to have unconditionally and irrevocably sold to each
Lender, and each Lender shall be deemed, without further action by any
party hereto, to have unconditionally and irrevocably purchased from
the Issuer, an undivided interest and participation in such Facility LC
(and each Modification thereof and the related LC Obligations in
proportion to its Pro Rata Share), the Obligations of the Borrower in
respect thereof, and the liability of the Issuer thereunder, in an
amount equal to the full amount of such Facility LC multiplied by such
Lender's Commitment percentage under the Facilities.
2.19.3 Notice. Subject to Section 2.19.1, the Borrower shall
give the Issuer notice prior to 10:00 a.m. (Chicago time) at least five
Business Days prior to the proposed date of issuance or Modification of
each Facility LC, specifying the beneficiary, the proposed date of
issuance (or Modification) and the expiry date of such Facility LC, and
describing the proposed terms of such Facility LC and the nature of the
transactions proposed to be supported thereby, including whether such
shall be a Standby Facility LC. Upon receipt of such notice, the Issuer
shall promptly notify the Agent, and the Agent shall promptly notify
each Lender, of the contents thereof and of the amount of such Lender's
participation in such proposed Facility LC. The issuance or
Modification by the Issuer of any Facility LC shall, in addition to the
conditions precedent set forth in Article IV (the satisfaction of which
the Issuer shall have no duty to ascertain), be subject to the
conditions precedent that such Facility LC shall be satisfactory to the
Issuer and that the Borrower shall have executed and delivered such
application agreement and/or such other instruments and agreements
relating to such Facility LC as the Issuer shall have reasonably
requested (each, a "Facility LC Application"). In the event of any
conflict between the terms of this Agreement and the terms of any
Facility LC Application, the terms of this Agreement shall control.
2.19.4 LC Fees.
(a) The Borrower shall pay to the Agent, for the
account of the Lenders ratably in accordance with their
respective Pro Rata Shares, a fee on each Standby Facility LC
at a per annum rate equal to the Applicable Fee Rate in the
Pricing Schedule attached hereto (depending upon whether such
Standby Facility LC is a financial or a performance Facility
LC, to be determined by the Issuer, after the issuance of
which Facility LC the Issuer shall notify the Lenders of such
determination) multiplied times the outstanding amount of such
Standby Facility
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LC available for drawing, such fee to be payable in quarterly
arrears to the Agent for the ratable benefit of the Lenders
(including the Issuer), plus (without duplication of the fees
provided for in connection with the Fronting Fee (as defined
below)), documentation and processing charges and other
standard costs of issuance (such fee an "LC Fee"). The
Borrower shall also pay to the Agent to be distributed to the
Issuer on a quarterly basis (x) a fronting fee (the "Fronting
Fee") calculated from the issuance date to the expiry date
(including any extension or modification), and equal to .125%
per annum multiplied times the face amount of such Standby
Facility LC, and (y) documentary and processing charges in
connection with the issuance or Modification of and draws
under Facility LCs in accordance with the Issuer's standard
schedule for such charges as in effect from time to time with
respect to the issuance, amendment, cancellation, negotiation
or transfer of each Letter of Credit and each drawing made
thereunder.
(b) The Borrower shall pay to the Agent, for the
account of the Lenders, ratably in accordance with their
respective Pro Rata Shares, a fee on each Commercial Facility
LC, at a per annum rate equal to the Applicable Margin in the
Pricing Schedule attached hereto multiplied by the face amount
of such Commercial Facility LC, such fee to be payable
quarterly in arrears to the Agent for the ratable benefit of
the Lenders (including the Issuer), plus (without duplication
of the fees provided for in connection with the Commercial
Fronting Fee (as defined below)), documentation and processing
charges and other standard costs of issuance (such fee a
"Commercial LC Fee"). The Borrower shall also pay to the Agent
to be distributed to the Issuer on a quarterly basis (x) a
fronting fee (the "Commercial Fronting Fee") calculated from
the issuance date to the expiry date (including any extension
or modification) and equal to .125% per annum multiplied by
the face amount of such Commercial Facility LC, and (y)
documentary and processing charges in connection with the
issuance of Modification of and draws under Facility LCs in
accordance with the Issuer's standard schedule for such
charges as in effect from time to time with respect to the
issuance, amendment, cancellation, negotiation or transfer of
each Letter of Credit and each drawing made thereunder.
2.19.5 Administration, Reimbursement by Lenders. Upon receipt
from the beneficiary of any Facility LC of any demand for payment under
such Facility LC, the Issuer shall notify the Agent and the Agent shall
promptly notify the Borrower and each other Lender as to the amount to
be paid by the Issuer as a result of such demand and the proposed
payment date (the "LC Payment Date"). The responsibility of the Issuer
to the Borrower and each Lender shall be only to determine that the
documents (including each demand for payment) delivered under each
Facility LC in connection with such presentment shall be in conformity
in all material respects with such Facility LC. The Issuer shall
endeavor to exercise the same care in the issuance and administration
of the Facility LCs as it does with respect to letters of credit in
which no participations are granted, it being understood that in the
absence of any gross negligence or willful misconduct by the Issuer,
each Lender shall be unconditionally and irrevocably liable without
regard to the occurrence of any Default or any condition precedent
whatsoever,
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to reimburse the Issuer on demand for (i) such Lender's Pro Rata Share
of the amount of each payment made by the Issuer under each Facility LC
to the extent such amount is not reimbursed by the Borrower pursuant to
Section 2.19.6 below, plus (ii) interest on the foregoing amount to be
reimbursed by such Lender, for each day from the date of the Issuer's
demand for such reimbursement (or, if such demand is made after 11:00
a.m. (Chicago time) on such date, from the next succeeding Business
Day) to the date on which such Lender pays the amount to be reimbursed
by it, at a rate of interest per annum equal to the Federal Funds
Effective Rate for the first three days and, thereafter, at a rate of
interest equal to the rate applicable to Floating Rate Advances.
2.19.6 Reimbursement by Borrower. The Borrower shall be
irrevocably and unconditionally obligated to reimburse the Issuer on or
before the applicable LC Payment Date for any amounts to be paid by the
Issuer upon any drawing under any Facility LC, without presentment,
demand, protest or other formalities of any kind; provided that neither
the Borrower nor any Lender shall hereby be precluded from asserting
any claim for direct (but not consequential) damages suffered by the
Borrower or such Lender to the extent, but only to the extent, caused
by (i) the willful misconduct or gross negligence of the Issuer in
determining whether a request presented under any Facility LC issued by
it complied with the terms of such Facility LC or (ii) the Issuer's
failure to pay under any Facility LC issued by it after the
presentation to it of a request strictly complying with the terms and
conditions of such Facility LC. All Reimbursement Obligations shall
bear interest, payable on demand, for each day until paid at a rate per
annum equal to (x) the rate applicable to Floating Rate Advances for
such day if such day falls on or before the applicable LC Payment Date
and (y) the sum of 2% plus the rate applicable to Floating Rate
Advances for such day if such day falls after such LC Payment Date. The
Issuer will pay to each Lender ratably in accordance with its Pro Rata
Share all amounts received by it from the Borrower for application in
payment, in whole or in part, of the Reimbursement Obligation in
respect of any Facility LC issued by the Issuer, but only to the extent
such Lender has made payment to the Issuer in respect of such Facility
LC pursuant to Section 2.19.5. Subject to the terms and conditions of
this Agreement (including without limitation the submission of a
Borrowing Notice in compliance with Section 2.8 and the satisfaction of
the applicable conditions precedent set forth in Article IV), the
Borrower may request an Advance hereunder for the purpose of satisfying
any Reimbursement Obligation.
2.19.7 Obligations Absolute. The Borrower's obligations under
this Section 2.19 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense
to payment which the Borrower may have or have had against the Issuer,
any Lender or any beneficiary of a Facility LC. The Borrower further
agrees with the Issuer and the Lenders that the Issuer and the Lenders
shall not be responsible for, and the Borrower's Reimbursement
Obligation in respect of any Facility LC shall not be affected by,
among other things, the validity or genuineness of documents or of any
endorsements thereon, even if such documents should in fact prove to be
in any or all respects invalid, fraudulent or forged, or any dispute
between or among the Borrower, any of its Affiliates, the beneficiary
of any Facility LC or any financing institution or other party to whom
any Facility LC may be transferred or any claims or defenses whatsoever
of the Borrower or of any of its Affiliates against the beneficiary of
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any Facility LC or any such transferee. The Issuer shall not be liable
for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Facility LC. The Borrower agrees that any action
taken or omitted by the Issuer or any Lender under or in connection
with each Facility LC and the related drafts and documents, if done
without gross negligence or willful misconduct, shall be binding upon
the Borrower and shall not put the Issuer or any Lender under any
liability to the Borrower. Nothing in this Section 2.19.7 is intended
to limit the right of the Borrower to make a claim against the Issuer
for damages as contemplated by the proviso to the first sentence of
Section 2.19.6.
2.19.8 Actions of Issuer. The Issuer shall be entitled to
rely, and shall be fully protected in relying, upon any Facility LC,
draft, writing, resolution, notice, consent, certificate, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document 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, independent
accountants and other experts selected by the Issuer. The Issuer shall
be fully justified in failing or refusing to take any action under this
Agreement unless it shall first have received such advice or
concurrence of the Required Lenders as it reasonably deems appropriate
or it shall first be indemnified to its reasonable 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 Section 2.19, the Issuer
shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement in accordance with a request of the
Required Lenders, and such request and any action taken or failure to
act pursuant thereto shall be binding upon the Lenders and any future
holders of a participation in any Facility LC.
2.19.9 Indemnification. The Borrower hereby agrees to
indemnify and hold harmless each Lender, the Issuer and the Agent, and
their respective directors, officers, agents and employees from and
against any and all claims and damages, losses, liabilities, costs or
expenses which such Lender, the Issuer or the Agent may incur (or which
may be claimed against such Lender, the Issuer or the Agent by any
Person whatsoever) by reason of or in connection with the issuance,
execution and delivery or transfer of or payment or failure to pay
under any Facility LC or any actual or proposed use of any Facility LC,
including, without limitation, any claims, damages, losses,
liabilities, costs or expenses which the Issuer may incur by reason of
or in connection with (i) the failure of any other Lender to fulfill or
comply with its obligations to the Issuer hereunder (but nothing herein
contained shall affect any rights the Borrower may have against any
defaulting Lender) or (ii) by reason of or on account of the Issuer
issuing any Facility LC which specifies that the term "Beneficiary"
included therein includes any successor by operation of law of the
named Beneficiary, but which Facility LC does not require that any
drawing by any such successor Beneficiary be accompanied by a copy of a
legal document, satisfactory to the Issuer, evidencing the appointment
of such successor Beneficiary, provided that the Borrower shall not be
required to indemnify any Lender, the Issuer or the Agent for any
claims, damages, losses, liabilities, costs or expenses to the extent,
but only to the extent, caused by (x) the willful misconduct or gross
negligence of the Issuer or (y) the Issuer's failure to pay under any
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Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in
this Section 2.19.9 is intended to limit the obligations of the
Borrower under any other provision of this Agreement.
2.19.10 Lenders' Indemnification. Each Lender shall, ratably
in accordance with its Pro Rata Share, indemnify the Issuer, its
affiliates and their respective directors, officers, agents and
employees (to the extent not reimbursed by the Borrower) against any
cost, expense (including reasonable counsel fees and disbursements),
claim, demand, action, loss or liability (except such as result from
such indemnitees' gross negligence or willful misconduct or the
Issuer's failure to pay under any Facility LC after the presentation to
it of a request strictly complying with the terms and conditions of the
Facility LC) that such indemnitees may suffer or incur in connection
with this Section 2.19 or any action taken or omitted by such
indemnitees hereunder.
2.19.11 Facility LC Collateral Account. The Borrower agrees
that it will, upon the request of the Agent or the Required Lenders and
until the final expiration date of any Facility LC and thereafter as
long as any amount is payable to the Issuer or the Lenders in respect
of any Facility LC, maintain a special collateral account pursuant to
arrangements satisfactory to the Agent (the "Facility LC Collateral
Account") at the Agent's office at the address specified pursuant to
Article XIII, in the name of the Borrower but under the sole dominion
and control of the Agent, for the benefit of the Lenders and in which
such Borrower shall have no interest other than as set forth in Section
8.1. The Borrower hereby pledges, assigns and grants to the Agent, on
behalf of and for the ratable benefit of the Lenders and the Issuer, a
security interest in all of the Borrower's right, title and interest in
and to all funds which may from time to time be on deposit in the
Facility LC Collateral Account to secure the prompt and complete
payment and performance of the Obligations. The Agent will invest any
funds on deposit from time to time in the Facility LC Collateral
Account in certificates of deposit of Bank One having a maturity not
exceeding 30 days. Nothing in this Section 2.19.11 shall either
obligate the Agent to require the Borrower to deposit any funds in the
Facility LC Collateral Account or limit the right of the Agent to
release any funds held in the Facility LC Collateral Account in each
case other than as required by Section 8.1.
2.19.12 Rights as a Lender. In its capacity as a Lender, the
Issuer shall have the same rights and obligations as any other Lender.
2.20 Replacement of Lender. If the Borrower is required pursuant to
Section 3.1, Section 3.2 or Section 3.5 to make any additional payment to any
Lender or if any Lender's obligation to make or continue, or to convert Floating
Rate Advances into, Eurodollar Advances shall be suspended pursuant to Section
3.3 (any Lender so affected an "Affected Lender"), the Borrower may elect, if
such amounts continue to be charged or such suspension is still effective, to
replace such Affected Lender as a Lender party to this Agreement, provided that
no Default or Unmatured Default shall have occurred and be continuing at the
time of such replacement, and provided further that, concurrently with such
replacement, (i) another bank or other entity which is reasonably satisfactory
to the Borrower and the Agent shall agree, as of such date, to purchase for cash
the Advances and other Obligations due to the Affected Lender pursuant to an
assignment substantially in the form of Exhibit 12.3.1 and to become a Lender
for all purposes
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under this Agreement and to assume all obligations of the Affected Lender to be
terminated as of such date and to comply with the requirements of Section 12.3
applicable to assignments, and (ii) the Borrower shall pay to such Affected
Lender in same day funds on the day of such replacement all interest, fees and
other amounts then accrued but unpaid to such Affected Lender by the Borrower
hereunder to and including the date of termination, including without limitation
payments due to such Affected Lender under Section 3.1, Section 3.2 and Section
3.5.
ARTICLE III
YIELD PROTECTION; TAXES
3.1 Yield Protection.
(a) If any law or any governmental or quasi-governmental rule,
regulation, policy, guideline or directive (whether or not having the
force of law), or any interpretation or administration thereof by any
governmental or quasi-governmental authority, central bank or
comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender or applicable Lending Installation
with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency:
(i) subjects any Lender or any applicable Lending
Installation or the Issuer to any Taxes, or changes the basis
of taxation of payments (other than with respect to Excluded
Taxes) to any Lender or the Issuer in respect of its
Eurodollar Loans, Facility LCs or participations therein, or
(ii) imposes or increases or deems applicable any
reserve, assessment, insurance charge, special deposit or
similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender or any
applicable Lending Installation or the Issuer (other than
reserves and assessments taken into account in determining the
interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which
is to increase the cost to any Lender or any applicable
Lending Installation or the Issuer of making, funding or
maintaining its Eurodollar Loans, or of issuing or
participating in Facility LCs, or reduces any amount
receivable by any Lender or any applicable Lending
Installation or the Issuer in connection with its Eurodollar
Loans, Facility LCs or participations therein, or requires any
Lender or any applicable Lending Installation or the Issuer to
make any payment calculated by reference to the amount of
Eurodollar Loans, Facility LCs or participations therein held
or interest or LC Fees received by it, by an amount deemed
material by such Lender or the Issuer as the case may be,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the Issuer, as the case may be, of making or
maintaining its Eurodollar Loans, Commitment or Swing Line Commitment, or of
issuing or participating in Facility LCs or to reduce the return received by
such Lender or applicable Lending Installation or the Issuer, as the case may
be, in connection with such Eurodollar Loans, Commitment, Facility LCs or
participations therein, then, within 3 days of demand by such Lender or the
Issuer, as the
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case may be, the Borrower shall pay such Lender or the Issuer, as the case may
be, such additional amount or amounts as will compensate such Lender or the
Issuer, as the case may be, for such increased cost or reduction in amount
received. A Lender claiming compensation under this section shall notify the
Borrower in writing of such claim, and shall only be entitled to compensation
under this Section 3.1 for increased costs occurring (i) from and after the date
of such notice until the events giving rise to such claim have ceased to exist,
and (ii) during the one hundred twenty (120) day period preceding the date the
Borrower receives notice from Agent or such Lender setting forth the described
claim for compensation.
(b) Borrower may, if obligated to make a payment under this
Section 3.1, require the Lender(s) collecting such payment to (i)
change its Lending Installation to a different location so as to
minimize such payment obligation or (ii) sell its interests herein to a
Lender or other Person reasonably satisfactory to Agent.
3.2 Changes in Capital Adequacy Regulations.
(a) If a Lender or the Issuer determines the amount of capital
required or expected to be maintained by such Lender or the Issuer, any
Lending Installation of such Lender or the Issuer, or any corporation
controlling such Lender or the Issuer is increased as a result of a
Change, then, within 3 days of demand by such Lender or the Issuer, the
Borrower shall pay such Lender or the Issuer the amount necessary to
compensate for any shortfall in the rate of return on the portion of
such increased capital which such Lender or the Issuer determines is
attributable to this Agreement, its Outstanding Credit Exposure or its
Commitment to make Loans and issue or participate in Facility LCs, as
the case may be, hereunder (after taking into account such Lender's or
the Issuer's policies as to capital adequacy). "Change" means (i) any
change after the Effective Date of this Agreement in the Risk-Based
Capital Guidelines or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law)
after the Effective Date which affects the amount of capital required
or expected to be maintained by any Lender or the Issuer or any Lending
Installation or any corporation controlling any Lender or the Issuer.
"Risk-Based Capital Guidelines" means (i) the risk-based capital
guidelines in effect in the United States on the Effective Date,
including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United
States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International
Convergence of Capital Measurements and Capital Standards," including
transition rules, and any amendments to such regulations adopted prior
to the Effective Date. A Lender claiming compensation under this
section shall notify the Borrower in writing of such claim, and shall
only be entitled to compensation under this Section 3.2 for increased
costs as a result of a Change occurring (i) from and after the date of
such notice until the events giving rise to such claim have ceased to
exist, and (ii) during the one hundred twenty (120) day period
preceding the date the Borrower receives notice from Agent or such
Lender setting forth the described claim for compensation resulting
from such Change.
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(b) Borrower may, if obligated to make a payment under this
Section 3.2, require the Lender(s) collecting such payment to (i)
change its Lending Installation to a different location so as to
minimize such payment obligation or (ii) sell its interests herein to a
Lender or other Person reasonably satisfactory to Agent.
3.3 Availability of Types of Advances. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate
Advances, subject to the payment of any funding indemnification amounts required
by Section 3.4.
3.4 Funding Indemnification. If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Eurodollar Advance.
3.5 Taxes.
(i) All payments by the Borrower to or for the
account of any Lender, the Issuer or the Agent hereunder or
under any Note or Facility LC Application shall be made free
and clear of and without deduction for any and all Taxes. If
the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder to any Lender, the
Issuer or the Agent, (a) the sum payable shall be increased as
necessary so that after making all required deductions
(including deductions applicable to additional sums payable
under this Section 3.5) such Lender, the Issuer or the Agent
(as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (b) the
Borrower shall make such deductions, (c) the Borrower shall
pay the full amount deducted to the relevant authority in
accordance with applicable law and (d) the Borrower shall
furnish to the Agent the original copy of a receipt evidencing
payment thereof within 30 days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay
any present or future stamp or documentary taxes and any other
excise or property taxes, charges or similar levies which
arise from any payment made hereunder or under any Note or
Facility LC Application or from the execution or delivery of,
or otherwise with respect to, this Agreement or any Note or
Facility LC Application ("Other Taxes").
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(iii) The Borrower hereby agrees to indemnify the
Agent, the Issuer and each Lender for the full amount of Taxes
or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed on amounts payable under this Section 3.5)
paid by the Agent, the Issuer or such Lender and any liability
(including penalties, interest and expenses) arising therefrom
or with respect thereto. Payments due under this
indemnification shall be made within 30 days of the date the
Agent or such Lender makes demand therefor pursuant to Section
3.6.
(iv) Each Lender that is not incorporated under the
laws of the United States of America or a state thereof (each
a "Non-U.S. Lender") agrees that it will, not less than ten
Business Days after the date it becomes a Lender, (i) deliver
to each of the Borrower and the Agent two duly completed
copies of United States Internal Revenue Service Form 1001 or
4224 or replacement or successor forms as the case may be,
certifying in either case that such Lender is entitled to
receive payments under this Agreement without deduction or
withholding of any United States federal income taxes, and
(ii) deliver to each of the Borrower and the Agent a United
States Internal Revenue Form W-8 or W-9 when it becomes a
Lender, as the case may be, and certify that it is entitled to
an exemption from United States backup withholding tax. Each
Non-U.S. Lender further undertakes to deliver to each of the
Borrower and the Agent (x) renewals or additional copies of
such form (or any successor form) on or before the date that
such form expires or becomes obsolete, and (y) after the
occurrence of any event requiring a change in the most recent
forms so delivered by it, such additional forms or amendments
thereto as may be reasonably requested by the Borrower or the
Agent. All forms or amendments described in the preceding
sentence shall certify that such Lender is entitled to receive
payments under this Agreement without deduction or withholding
of any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such
forms inapplicable or which would prevent such Lender from
duly completing and delivering any such form or amendment with
respect to it and such Lender advises the Borrower and the
Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
(v) For any period during which a Non-U.S. Lender has
failed to provide the Borrower with an appropriate form
pursuant to Section 3.5(iv) above (unless such failure is due
to a change in treaty, law or regulation, or any change in the
interpretation or administration thereof by any governmental
authority, occurring subsequent to the date on which a form
originally was required to be provided), such Non-U.S. Lender
shall not be entitled to indemnification under this Section
3.5 with respect to Taxes imposed by the United States;
provided that, should a Non-U.S. Lender which is otherwise
exempt from or subject to a reduced rate of withholding tax
become subject to Taxes because of its failure to deliver a
form required under Section 3.5(iv) above, the Borrower shall
take such steps as such Non-U.S. Lender shall reasonably
request to assist such Non-U.S. Lender to recover such Taxes.
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(vi) Any Lender that is entitled to an exemption from
or reduction of withholding tax with respect to payments under
this Agreement or any Note pursuant to the law of any relevant
jurisdiction or any treaty shall deliver to the Borrower (with
a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed
documentation prescribed by applicable law as will permit such
payments to be made without withholding or at a reduced rate.
(vii) If the U.S. Internal Revenue Service or any
other governmental authority of the United States or any other
country or any political subdivision thereof asserts a claim
that the Agent did not properly withhold tax from amounts paid
to or for the account of any Lender (because the appropriate
form was not delivered or properly completed, because such
Lender failed to notify the Agent of a change in circumstances
which rendered its exemption from withholding ineffective, or
for any other reason), such Lender shall indemnify the Agent
fully for all amounts paid, directly or indirectly, by the
Agent as tax, withholding therefor, or otherwise, including
penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Agent under this
subsection, together with all costs and expenses related
thereto (including attorneys fees and time charges of
attorneys for the Agent, which attorneys may be employees of
the Agent). The obligations of the Lenders under this Section
3.5(vii) shall survive the payment of the Obligations and
termination of this Agreement.
(viii) In the event that Borrower reimburses any
Lender or the Agent for any Taxes or pays any Taxes on any
Lender's or the Agent's behalf pursuant to this Section 3.5
and such Lender or Agent thereafter receives any refund or
credit of such Taxes, such Lender or Agent shall promptly pay
Borrower the amount of any such refund or credit.
3.6 Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrower to such
Lender under Section 3.1, Section 3.2 and Section 3.5 or to avoid the
unavailability of Eurodollar Advances under Section 3.3, so long as such
designation is not, in the judgment of such Lender, disadvantageous to such
Lender. Each Lender shall deliver a written statement of such Lender to the
Borrower (with a copy to the Agent) as to the amount due, if any, under Section
3.1, Section 3.2, Section 3.4 or Section 3.5. Such written statement shall set
forth in reasonable detail the calculations upon which such Lender determined
such amount and shall be presumed correct in the absence of manifest error.
Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded its Eurodollar
Loan through the purchase of a deposit of the type and maturity corresponding to
the deposit used as a reference in determining the Eurodollar Rate applicable to
such Loan, whether in fact that is the case or not. Unless otherwise provided
herein, the amount specified in the written statement of any Lender shall be
payable on demand after receipt by the Borrower of such written statement. The
obligations of the Borrower under Section 3.1, Section 3.2, Section 3.4 and
Section 3.5 shall survive payment of the Obligations and termination of this
Agreement.
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3.7 Effect of Yield Protection. The provisions of Section 3.1, Section
3.2, Section 3.3, Section 3.4 or Section 3.5 and Section 3.6 shall be
interpreted in the broadest possible terms to include any increased costs,
payments or reduced income for any reason, including but specifically not by way
of limitation, due to taxes, capital adequacy provisions, reserve requirements,
withholding obligations, costs due to the payment of any sums on a date other
than the regularly scheduled date or for any other reason. The Borrower does
hereby indemnify and hold harmless the Agent and each Lender for all such costs
and does hereby agree to pay same or cover the Agent's or any Lender's expenses
or losses in regard to same. The Borrower shall pay such sums to the Agent or to
any Lender as are necessary to mitigate all such items. This obligation is in
addition to all other Obligations of the Borrower hereunder.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Effectiveness. This Agreement shall not be effective until
satisfaction of the following conditions precedent or, as applicable, Borrower
has furnished the following to the Agent each in form and substance satisfactory
to the Agent and with sufficient copies for the Lenders, where appropriate,
executed by the relevant Person and notarized:
(i) Copies of the articles or certificate of
incorporation or organization, as applicable, of the Borrower
and its Domestic Subsidiaries that are Material Subsidiaries,
together with all amendments, certified by the appropriate
governmental officer in such Person's jurisdiction of
organization or at Borrower's option, by an appropriate
officer of Borrower or the relevant Subsidiary.
(ii) Copies, certified by the Secretary or Assistant
Secretary of the Borrower and its Domestic Subsidiaries that
are Material Subsidiaries, as applicable, of their respective
by-laws, operating or other management agreement.
(iii) Copies, certified by the Secretary or Assistant
Secretary of the Borrower and its Domestic Subsidiaries that
are Material Subsidiaries, as applicable, along with
certificates of good standing and existence or authority to do
business as a foreign entity, as applicable, of resolutions of
their respective boards of directors or members and of any
other body authorizing the execution of the Loan Documents to
which such Person is a party.
(iv) Incumbency certificates, executed by the
Secretary or Assistant Secretary of the Borrower and its
Domestic Subsidiaries that are Material Subsidiaries, as
applicable, which shall identify by name and title and bear
the signatures of the Authorized Officers and any other
officers or managers of the Borrower and its Domestic
Subsidiaries authorized to sign the Loan Documents to which
such Person is a party, upon which certificates the Agent and
the Lenders shall be entitled to rely until informed of any
change in writing by the Borrower.
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(v) A certificate, signed by the chief financial
officer of each Guarantor that is a Material Subsidiary
certifying that on the initial Credit Extension Date such
Guarantor is solvent, which certificate shall be,
substantially in the form of Exhibit 4.1(v) hereto.
(vi) Intentionally omitted.
(vii) Any Notes requested by a Lender pursuant to
Section 2.13 payable to the order of each such requesting
Lender.
(viii) Written money transfer instructions, in
substantially the form of Exhibit 4.1(vii), addressed to the
Agent and signed by an Authorized Officer, together with such
other related money transfer authorizations as the Agent may
have reasonably requested.
(ix) The payment to the Agent and the Lenders of all
fees and expenses agreed upon by such Person and the Borrower
including those agreed to in that certain Agent and Fee Letter
dated January 2, 2002; execution of such Fee Letter).
(x) This Agreement.
(xi) The Collateral Documents.
(xii) A Ratification of Guaranty, in form
satisfactory to Agent.
(xiii) A Ratification of the Collateral Documents, in
form satisfactory to Agent.
(xiv) The Subordination Agreement.
(xv) There shall not have occurred, in the Agent's
sole discretion, a Material Adverse Effect in respect of the
Borrower and its Subsidiaries on a consolidated basis since
November 30, 2001.
(xvi) There shall not have occurred, in the Agent's
sole discretion, any material adverse change in primary and
secondary loan syndication markets or capital markets
generally that would impair syndication of the Loans.
(xvii) The insurance certificate described in Section
5.21.
(xviii) Lien searches on the Borrower and each
Guarantor in the jurisdictions requested by the Agent,
together with waivers from the holders of any Liens (other
than Permitted Liens) as deemed necessary by the Lenders.
(xix) No litigation shall be pending that (i) has
resulted in or requests an injunction or restraining order
prohibiting the Loans, or (ii) could reasonably be expected,
if adversely decided, to result in a Material Adverse Effect
on Borrower.
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(xx) The calculation shown on Schedule 4.1(xx) shall
be true and correct, Borrower shall be in pro forma and
historical compliance with all covenants contained in Article
VI hereof, including specifically, without limitation, those
contained in Section 6.22 (but excluding the covenant
contained in Section 6.22.2).
(xxi) A listing of all Investments in excess of
$1,000,000 by the Borrower or a Domestic Subsidiary in any
Foreign Subsidiary.
(xxii) Such other documents as any Lender or its
counsel may have reasonably requested.
Agent and Lenders acknowledge and agree that the items
described in Section 4.1(i), Section 4.1(ii), Section 4.1(xi)
and Section 4.1(xiv) were delivered together with the July
Credit Agreement, that such items are acceptable as delivered
at such time, and that the information contained in Section
4.1(i) and Section 4.1(ii) has not changed since delivery
thereof.
4.2 Each Credit Extension. In addition to the above, the Lenders shall
not be required to make any Credit Extension unless on the applicable Credit
Extension Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in
Article V are true and correct as of such Credit Extension
Date except to the extent any such representation or warranty
is stated to relate solely to an earlier date, in which case
such representation or warranty shall have been true and
correct on and as of such earlier date.
(iii) Agent has received a Borrowing Request.
(iv) All legal matters incidental to the making of
such Credit Extension shall be satisfactory to the Lenders and
their counsel.
(v) Borrower has and has caused the Guarantors to
execute and deliver this Agreement to the Agent.
4.3 Reaffirmations of Warranties. Each Borrowing Notice or request for
issuance of a Facility LC with respect to each such Credit Extension shall
constitute a representation and warranty by the Borrower that the conditions
contained in Section 4.2(i) and Section 4.2(ii) have been satisfied. Any Lender
may require a duly completed compliance certificate in substantially the form of
Exhibit 6.1(iv) as a condition to making a Credit Extension.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower for itself and each of its Domestic Subsidiaries
represents and warrants to the Lenders that:
5.1 Existence and Standing. Each of the Borrower and its Subsidiaries
is a corporation, partnership (in the case of Subsidiaries only) or limited
liability company duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted, except where the failure to so
qualify would not have a Material Adverse Effect.
5.2 Authorization and Validity. The Borrower and each of its
Subsidiaries has the requisite power and authority and legal right to execute
and deliver the Loan Documents to which it is a party and to perform its
obligations thereunder. The execution and delivery by the Borrower and each of
its Subsidiaries of the Loan Documents to which it is a party and the
performance of its respective obligations thereunder have been duly authorized
by proper corporate proceedings, and the Loan Documents to which the Borrower
and each of its Subsidiaries is a party constitute legal, valid and binding
obligations of such Person enforceable against such Person in accordance with
their terms, except as enforceability may be limited by bankruptcy, insolvency
or similar laws affecting the enforcement of creditors' rights generally.
5.3 No Conflict; Government Consent. Neither the execution and delivery
by the Borrower or any of its Domestic Subsidiaries of any of the Loan Documents
to which it is a party, nor the consummation of the transactions therein
contemplated, nor compliance with the provisions thereof will violate (i) any
law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on the Borrower or any of its Material Subsidiaries, except for such
violations or defaults as would not have a Material Adverse Effect or (ii) the
Borrower's or any Subsidiary's articles or certificate of incorporation,
partnership agreement, certificate of partnership, articles or certificate of
organization, by-laws, or operating or other management agreement, as the case
may be, or (iii) the provisions of any indenture, instrument or agreement to
which the Borrower or any of its Subsidiaries is a party or is subject, or by
which it, or its Property, is bound, or conflict with or constitute a default
thereunder, or result in, or require, the creation or imposition of any Lien in,
of or on the Property of the Borrower or any Subsidiary pursuant to the terms of
any such indenture, instrument or agreement, except for such conflicts,
violations or defaults as would not have a Material Adverse Effect. No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its Domestic
Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under this Agreement, the payment and performance by
the Borrower of the Obligations, the performance by any Material Subsidiary of
its obligations under its Guaranty or the legality, validity, binding effect or
enforceability of any of the Loan Documents.
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5.4 Financial Statements. The November 30, 2001 and all subsequently
provided consolidated financial statements of the Borrower and its Subsidiaries
heretofore delivered to the Lenders were prepared in accordance with generally
accepted accounting principles in effect on the date such statements were
prepared and fairly present, in all material respects, the consolidated
financial condition and operations of the Borrower and its Subsidiaries at such
date and the consolidated results of their operations for the period then ended.
5.5 Material Adverse Change. Since November 30, 2001, there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and its Subsidiaries taken as a whole
which could reasonably be expected to have a Material Adverse Effect.
5.6 Taxes. The Borrower and each of its Domestic Subsidiaries have
filed all United States federal tax returns and all other tax returns which are
required to be filed and have paid all taxes due pursuant to said returns or
pursuant to any assessment received by the Borrower or any of its Subsidiaries,
except (i) such taxes, if any, as are being contested in good faith and as to
which adequate reserves have been provided in accordance with Agreement
Accounting Principles and as to which no Lien exists, and (ii) for such failures
to file or failures to pay as could not have a Material Adverse Effect. No tax
liens have been filed with respect to any such taxes. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate in all material respects in
accordance with Agreement Accounting Principles.
5.7 Litigation and Contingent Obligations. Except as disclosed on
Schedule 5.7, there is no litigation, arbitration, governmental investigation,
proceeding or inquiry pending or, to the knowledge of any of their executive
officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect or which seeks to prevent, enjoin or delay the making of any Credit
Extensions. Except as disclosed on Schedule 5.7, other than any liability
incident to any litigation, arbitration or proceeding which could not reasonably
be expected to have a Material Adverse Effect, the Borrower has no material
contingent obligations not provided for or disclosed in the financial statements
referred to in Section 5.4 which should be disclosed under Agreement Accounting
Principles.
5.8 Subsidiaries. Schedule 5.8 contains an accurate list of all
Subsidiaries of the Borrower as of the date of this Agreement, setting forth for
each Subsidiary (a) such Subsidiary's jurisdiction of incorporation or
organization, (b) the percentage of such Subsidiary's capital stock or other
ownership interests owned by the Borrower or any other Subsidiary, (c) the
principal places of business and the chief executive offices of such Subsidiary,
(d) the locations of any inventory or equipment owned by such Subsidiary and (e)
any past names or d/b/a's used by such Subsidiary during the two (2) years prior
to the Effective Date and whether each of such Subsidiaries is a Material
Subsidiary. All of the issued and outstanding shares of capital stock or other
ownership interests of such Subsidiaries have been (to the extent such concepts
are relevant with respect to such ownership interests) duly authorized and
issued and are fully paid and non-assessable.
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5.9 ERISA. The Unfunded Liabilities of all Single Employer Plans do not
in the aggregate exceed $2,000,000. Neither the Borrower nor any other member
of the Controlled Group has incurred, or is reasonably expected to incur, any
withdrawal liability to Multiemployer Plans in excess of $2,000,000 in the
aggregate. Each Plan complies in all material respects with all applicable
requirements of law and regulations, no Reportable Event has occurred with
respect to any Plan that could have a Material Adverse Effect, neither the
Borrower nor any other member of the Controlled Group has withdrawn from any
Multiemployer Plan or initiated steps to do so, and no steps have been taken to
reorganize or terminate any Plan.
5.10 Accuracy of Information. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading.
5.11 Regulation U, T and X. The Loans and other transactions
contemplated hereunder will not violate the provisions of Regulations U, T or X.
5.12 Material Agreements. Except as disclosed on Schedule 5.12, neither
the Borrower nor any Subsidiary is a party to any loan transaction or guaranty
of the Indebtedness of another Person as of the Effective Date. Neither the
Borrower nor any Subsidiary is a party to any agreement or instrument or subject
to any charter or other corporate restriction which could reasonably be expected
to have a Material Adverse Effect. Neither the Borrower nor any Subsidiary is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in (i) any agreement to which it is a party,
which default could reasonably be expected to have a Material Adverse Effect or
(ii) any agreement or instrument evidencing or governing Indebtedness in excess
of $2,000,000.
5.13 Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property except where the
failure to so comply could not have a Material Adverse Effect.
5.14 Ownership of Properties. Except as set forth on Schedule 5.14, on
the Effective Date, the Borrower and its Subsidiaries will have good title, free
of all Liens other than those permitted by Section 6.15, to all of the Property
and assets reflected in the Borrower's most recent consolidated financial
statements provided to the Agent as owned by the Borrower and its Subsidiaries.
5.15 Plan Assets; Prohibited Transactions. The Borrower is not an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. Section
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and neither the execution of this Agreement nor the making of
Credit Extensions hereunder gives rise to a prohibited transaction that could
have a Material Adverse Effect within the meaning of Section 406 of ERISA or
Section 4975 of the Code.
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5.16 Environmental Matters. In the ordinary course of its business, the
officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that any noncompliance, if any, of Borrower or any of its Subsidiaries
with Environmental Laws could not reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary has received any notice
to the effect that its operations are not in material compliance with any of the
requirements of applicable Environmental Laws or are the subject of any federal
or state investigation evaluating whether any remedial action is needed to
respond to a release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.17 Investment Company Act. Neither the Borrower nor any Subsidiary is
an "investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.
5.18 Public Utility Holding Company Act. Neither the Borrower nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19 No Default. On the Effective Date, no Default or Unmatured Default
will have occurred or be continuing.
5.20 Post-Retirement Benefits. The present value of the expected cost
of post-retirement medical and insurance benefits payable by the Borrower and
its Subsidiaries to its employees and former employees, as estimated by the
Borrower in accordance with procedures and assumptions deemed reasonable by the
Required Lenders, does not exceed $2,000,000.
5.21 Insurance. The certificate signed by the President or Chief
Financial Officer of the Borrower, that attests to the existence and adequacy
of, and summarizes, the property and casualty insurance program carried by the
Borrower with respect to itself and its Subsidiaries and that has been furnished
by the Borrower to the Agent and the Lenders, is complete and accurate in all
material respects. This summary includes the insurer's or insurers' name(s),
policy number(s), expiration date(s), amount(s) of coverage, type(s) of
coverage, exclusion(s), and deductibles. This summary also includes similar
information, and describes any reserves, relating to any self-insurance program
that is in effect.
5.22 Solvency.
(i) Immediately after the consummation of the
transactions that occurred on July 14, 2000 and immediately
following the making of each Credit Extension, if any, made on
July 14, 2000 and after giving effect to the application of
the proceeds of such Credit Extension and as of the Effective
Date, (a) the fair
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value of the assets of the Borrower and its Subsidiaries on a
consolidated basis, at a fair valuation, will exceed the debts
and liabilities, subordinated, contingent or otherwise, of the
Borrower and its Subsidiaries on a consolidated basis; (b) the
present fair saleable value of the Property of the Borrower
and its Subsidiaries on a consolidated basis will be greater
than the amount that will be required to pay the probable
liability of the Borrower and its Subsidiaries on a
consolidated basis on their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (c) the Borrower and
its Subsidiaries on a consolidated basis will be able to pay
their debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and
matured; and (d) the Borrower and its Subsidiaries on a
consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged
as such businesses are now conducted and are proposed to be
conducted after the Effective Date and as of the Effective
Date.
(ii) The Borrower does not intend to, or to permit
any of its Subsidiaries to, and does not believe that it or
any of its Subsidiaries will, incur debts beyond its ability
to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable
on or in respect of its Indebtedness or the Indebtedness of
any such Subsidiary.
5.23 Bond Obligations. As of the Effective Date, neither the Borrower
nor any of its Domestic Subsidiaries have any reimbursement or guaranty
obligations owing to bonding companies except as described on Schedule 5.23
attached hereto.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Financial Reporting. The Borrower will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with generally accepted accounting principles, and furnish to the
Lenders:
(i) Within 90 days after the close of each of its
fiscal years, an unqualified audit report certified by
independent certified public accountants acceptable to the
Lenders, it being understood that the Borrower's auditors as
of the Effective Date are acceptable to the Agent and the
Lenders, prepared in accordance with Agreement Accounting
Principles on a consolidated for itself and its Subsidiaries,
including balance sheets as of the end of such period, related
profit and loss and reconciliation of surplus statements, and
a statement of cash flows, accompanied by (a) any management
letter prepared by said accountants, and (b) a certificate of
said accountants that, in the course of their examination
necessary for their certification of the foregoing, they have
obtained no
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knowledge of any Default or Unmatured Default under any of the
terms, covenants, provisions or conditions of Section 6.22
insofar as they relate to accounting matters, or if, in the
opinion of such accountants, any Default or Unmatured Default
shall exist, stating the nature and status thereof.
(ii) Within 45 days after the close of the first
three quarterly periods of each of its fiscal years and within
90 days of the end of the final fiscal quarter, for itself and
its Subsidiaries, consolidated and consolidating unaudited
balance sheets as at the close of each such quarterly period
and consolidated and consolidating profit and loss and
reconciliation of surplus statements and a statement of cash
flows for the period from the beginning of such fiscal year to
the end of such quarter, all certified by its Chief Financial
Officer.
(iii) As soon as available, but in any event prior to
the beginning of each fiscal year of the Borrower, a copy of
the plan and forecast (including a projected consolidated
balance sheet, income statement and funds flow statement) of
the Borrower for the upcoming fiscal year.
(iv) Together with the financial statements required
under Section 6.1(i) and Section 6.1(ii), a compliance
certificate in substantially the form of Exhibit 6.1(iv)
signed by its Chief Financial Officer showing the calculations
necessary to determine compliance with this Agreement and
stating that no Default or Unmatured Default exists, or if any
Default or Unmatured Default exists, stating the nature and
status thereof.
(v) Within 270 days after the close of each fiscal
year, a statement of the Unfunded Liabilities of each Single
Employer Plan, certified as correct by an actuary enrolled
under ERISA.
(vi) As soon as possible and in any event within 10
days after the Borrower knows that any Reportable Event has
occurred with respect to any Plan, a statement, signed by the
Chief Financial Officer of the Borrower, describing said
Reportable Event and the action which the Borrower proposes to
take with respect thereto.
(vii) As soon as possible and in any event within 10
days after receipt by the Borrower, a copy of (a) any notice
or claim to the effect that the Borrower or any of its
Subsidiaries is or may be liable to any Person as a result of
the release by the Borrower, any of its Subsidiaries, or any
other Person of any toxic or hazardous waste or substance into
the environment, and (b) any notice alleging any violation of
any federal, state or local environmental, health or safety
law or regulation by the Borrower or any of its Subsidiaries.
(viii) Promptly upon the furnishing thereof to the
shareholders of the Borrower, copies of all financial
statements, reports and proxy statements so furnished.
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(ix) Promptly upon the filing thereof, copies of all
registration statements and annual, quarterly, monthly or
other regular reports, except for those filed on Form S-8,
which the Borrower or any of its Subsidiaries files with the
Securities and Exchange Commission.
(x) Promptly upon request by the Agent or the
Required Lenders, such information as will facilitate an
annual on site inspection and audit of Borrower's Inventory
and equipment (or any other collateral the subject of the
Collateral Documents).
(xi) Such other information (including non-financial
information) as the Agent or any Lender may from time to time
reasonably request.
6.2 Use of Proceeds. The Borrower will use the proceeds of the Advances
and the Letters of Credit solely (i) for the Borrower's and its Subsidiaries'
working capital and general corporate purposes, including the issuance of the
Facility LCs, (ii) to make Acquisitions permitted hereunder, and (iii) any other
uses approved by the Lenders in accordance herewith. Such purposes will not
violate and are otherwise consistent with the terms of the Loan Documents and
all laws, rules and regulations, including Regulations T, U and X. The Borrower
will not, nor will it permit any Subsidiary to, use any of the proceeds of the
Advances to purchase or carry any "margin stock" (as defined in Regulation U).
6.3 Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders of the occurrence of
any Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4 Conduct of Business; Books and Records. The Borrower will, and will
cause each Subsidiary to, carry on and conduct its business in substantially the
same manner and in substantially the same fields of enterprise as it is
presently conducted, shall maintain books and records thereof in accordance with
Agreement Accounting Principles and its current practice, and shall do all
things necessary to remain duly incorporated or organized, validly existing and
(to the extent such concept applies to such entity) in good standing as a
domestic corporation, partnership or limited liability company in its
jurisdiction of incorporation or organization, as the case may be, and maintain
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted except for (i) mergers and consolidations of
Subsidiaries with and into Borrower or any Domestic Subsidiaries, to the extent
permitted under Section 6.12 hereof, (ii) the dissolution or liquidation of
Subsidiaries if the net proceeds from any such dissolution are paid to Borrower
or any Domestic Subsidiary, and (iii) any failure of a Subsidiary to be in good
standing where such failure could not have a Material Adverse Effect.
6.5 Taxes. The Borrower will, and will cause each Subsidiary to, timely
file complete and correct United States federal and applicable foreign, state
and local tax returns required by law and pay when due all taxes, assessments
and governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles. At any time that the Borrower or any of
its Subsidiaries is
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organized as a limited liability company, each such limited liability company
will qualify for partnership tax treatment under United States federal tax law.
6.6 Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice, and in each case, (a) with such deductibles and with
such self-insurance provisions as are customarily maintained by similar
businesses, and (b) naming the Agent as loss payee or as an additional insured,
as appropriate, for the benefit of the Lenders and, in any case consistent with
the requirements of the Pledge and Security Agreement. The Borrower will furnish
to any Lender upon request full information as to the insurance carried.
6.7 Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws and ERISA except for such failures to
comply as could not reasonably be expected to have a Material Adverse Effect.
6.8 Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times, except that the
foregoing shall not apply to Property disposed of by Borrower in accordance with
Section 6.13 hereof.
6.9 Inspection. The Borrower will, and will cause each Subsidiary to,
permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, books and financial records of the
Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each Subsidiary, and to
discuss the affairs, finances and accounts of the Borrower and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Agent or any Lender may designate.
6.10 Dividends. The Borrower will not, nor will it permit any
Subsidiary to, declare or pay any dividends or make any distributions on its
capital stock (other than stock splits, dividends payable in its own capital
stock) or redeem, repurchase or otherwise acquire or retire any of its capital
stock at any time outstanding, except that (i) any Subsidiary may declare and
pay dividends or make distributions to the Borrower or to any domestic
Wholly-Owned Subsidiary, and (ii) Borrower may redeem or repurchase its capital
stock or the LYONs at any time after the Effective Date for amounts that do not
in the aggregate exceed $25,000,000 during the term hereof, and only so long as
Consolidated Total Net Cash is at least $75,000,000 after giving effect to any
such redemption or repurchase. Notwithstanding the foregoing, the provisions of
this Section 6.10 shall not prohibit purchases of common stock by Borrower or
its Subsidiaries or a trust pursuant to an employee benefit plan or the cashless
exercise of stock options or warrants to purchase common stock of Borrower by
Borrower or a trust that in each case has been approved by the Board of
Directors of Borrower.
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6.11 Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) Indebtedness created hereunder.
(ii) Indebtedness, including, without limitation,
contingent liabilities, existing on the Effective Date and
described in Schedule 6.11(ii).
(iii) Indebtedness incurred in the ordinary course of
business in connection with the acquisition of Property by the
Borrower, or any Subsidiary (excluding Indebtedness assumed on
any assets acquired pursuant to an Acquisition), provided that
such Indebtedness shall not exceed the value of the Property
so acquired, and in any event, such purchase money
Indebtedness shall not exceed Ten Million Dollars
($10,000,000) in the aggregate.
(iv) Secured or unsecured Indebtedness assumed by the
Borrower or a Subsidiary in connection with an Acquisition
permitted hereunder and not discharged on the Effective Date
which, in the aggregate, shall not exceed Twenty Million
Dollars ($20,000,000); provided that any Lien securing any
such secured Indebtedness shall attach only to the Property
securing such Indebtedness prior to its assumption.
(v) Permitted Indebtedness.
(vi) Indebtedness of Foreign Subsidiaries to the
Borrower or a Domestic Subsidiary incurred to facilitate the
operations and funding of said Foreign Subsidiaries not to
exceed the sum of (a) such Indebtedness to the extent
outstanding on the Effective Date and described on Schedule
6.11(ii) plus (b) $10,000,000 in the aggregate outstanding at
any one time, provided all such Indebtedness is evidenced by
promissory notes that become part of the Collateral in a
manner reasonably satisfactory to the Agent.
(vii) Indebtedness of Foreign Subsidiaries to
non-Affiliates of Borrower in an amount not to exceed
$10,000,000.
(viii) Indebtedness that constitutes a renewal,
refinancing or extension of any Indebtedness referred to in
this Section 6.11; provided that (A) no Lien existing at the
time of such renewal, refinancing or extension shall be
extended to cover any property not already subject to such
Lien, and (B) the principal amount of any Indebtedness
renewed, refinanced or extended shall not exceed the amount of
such Indebtedness outstanding immediately prior to such
renewal, refinancing or extension.
(ix) Indebtedness evidenced by those certain liquid
yield option notes due 2021 in an amount not in excess of
$790,000,000 in face value, more particularly described in
that certain Offering Memorandum dated April 26, 2001,
prepared by Merrill Lynch & Co., in the form provided to the
Agent (the "LYONs").
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(x) The contingent liability evidenced by a guaranty
executed by the Borrower to guarantee obligations of Stone &
Webster Canada L.P. under that certain $7,500,000 credit
facility for working capital and letters of credit; the
obligations of Borrower under such guaranty shall not exceed
$7,500,000.
6.12 Merger. The Borrower will not, nor will it permit any Subsidiary
to, merge or consolidate with or into any other Person, except that if at the
time thereof and immediately after giving effect thereto no Default or Unmatured
Default shall have occurred and be continuing, (i) any Subsidiary may merge into
or be consolidated with the Borrower in a transaction in which the Borrower is
the surviving Person, (ii) any Subsidiary may merge into or be consolidated with
any Domestic Subsidiary in a transaction in which the surviving entity is a
Domestic Subsidiary, (iii) any foreign Subsidiary may merge into or be
consolidated with any foreign Subsidiary and (iv) mergers and consolidations
constituting Acquisitions permitted under Section 6.24.
6.13 Sale of Assets. The Borrower will not, nor will it permit any
Material Subsidiary to, lease, sell or otherwise dispose of (in one transaction
or in a series of transactions) its Property to any other Person, except:
(i) Sales of Inventory in the ordinary course of
business.
(ii) The sale of the ethylene process engineering
business, all related assets and related office building
located in Harris County, Texas to an unrelated third party in
an arms-length transaction.
(iii) Sales, leases or other dispositions by Borrower
or any Subsidiary of obsolete, underutilized, damaged or
defective Property or equipment that is no longer used or
useful in the business of Borrower or its Subsidiaries.
(iv) Any sale, lease or other disposition by or among
the Borrower and its Domestic Subsidiaries, or among the
Domestic Subsidiaries, or from one Foreign Subsidiary to
another Foreign Subsidiary.
(v) Licenses by Borrower or any Subsidiary of
patents, trademarks, copyrights, know-how, or other
intellectual property to any other Person in the ordinary
course of business.
(vi) The sale of other assets not to exceed 10% of
Borrower's tangible net worth, calculated pursuant to
Agreement Accounting Principles, per annum.
6.14 Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in, Foreign
Subsidiaries), or commitments therefor, or to create any Subsidiary (except in
accordance with Section 6.23 and Section 6.24) or to become or remain a partner
in any partnership or joint venture, or to make any Acquisition of any Person,
except:
(i) Cash Equivalent Investments.
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(ii) Existing Investments in existence on the
Effective Date and described in Schedule 6.14(ii) in an amount
not greater than the amount thereof on the Effective Date.
(iii) Acquisitions permitted under Section 6.24 or
Section 6.25.
(iv) Investments in the Entergy Joint Venture with
Entergy Wholesale Operation, not to exceed $10,000,000 in the
aggregate for project related financing, which Investments are
nonrecourse to the Borrower and to each Subsidiary.
(v) Investments in corporate debt obligations rated
AA- or better by Standard & Poor's or Aa3 or better by Moody's
Investment Service and maturing not more than twelve (12)
months from the date of acquisition thereof.
(vi) Repurchase agreements, which shall be
collateralized for at least 100% of face value, issued by any
of the Banks or any other bank or trust company organized
under the laws of the United States or any state thereof,
which bank or trust company (other than the Banks to which
such restrictions shall not apply) is a member of both the
Federal Deposit Insurance Corporation and the Federal Reserve
System and is rated B or better by Thompson Bank Watch Service
(all of which must mature within twelve (12) months from the
time of acquisition thereof).
(vii) Settlement accounts between the Borrower and
its Domestic Subsidiaries or its Domestic Subsidiaries and
other Domestic Subsidiaries.
(viii) Property and buildings necessary to the
operations of the Borrower and its Subsidiaries.
(ix) Permitted Business Investments.
(x) Permitted Financial Investments.
(xi) Investments by Borrower or any Subsidiary
thereof in any Person to the extent the consideration paid
consists solely of Qualified Stock of Borrower, unless the
nature of such Investment could reasonably be expected to
cause a Material Adverse Effect.
(xii) Investments not otherwise permitted above,
provided that the aggregate amount (at original cost) of all
such Investments of the Borrower and all of its Subsidiaries
at any time outstanding shall not exceed $15,000,000 if
Consolidated Total Net Cash is at least $75,000,000; otherwise
$5,000,000.
6.15 Liens. The Borrower will not, nor will it permit any Subsidiary
to, create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, nor will it covenant with any other Person
not to grant such a Lien to the Agent, except:
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(i) Permitted Liens.
(ii) Liens in favor of the Agent, for the benefit of
the Lenders, granted pursuant to any Collateral Document.
(iii) Liens existing on the Effective Date and
described in Schedule 6.15(iii).
(iv) Liens incurred in connection with any
Acquisition permitted under Section 6.24.
(v) Liens securing Indebtedness permitted under
Section 6.11(iii), Section 6.11(iv) or Section 6.11(vii).
(vi) Any renewal, extension or replacement of any
Lien referred to in Section 6.15(iii) and Section 6.15(iv)
above; provided that no Lien arising or existing as a result
of such extension, renewal or replacement shall be extended to
cover any property not theretofore subject to the Lien being
extended, renewed or replaced and provided further that the
principal amount of the Indebtedness secured thereby shall not
exceed the principal amount of the Indebtedness so secured at
the time of such extension, renewal or replacement.
6.16 Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arms-length transaction, provided this Section 6.16 shall not
prohibit inter-company transfers not otherwise restricted hereunder.
6.17 Prepayment of Other Indebtedness. The Borrower will not, and will
not permit any Subsidiary to (i) make voluntary prepayments of principal or
interest on any other of the Borrower's or such Subsidiary's Indebtedness except
(A) as expressly provided herein, (B) prepayments of principal or interest
secured by liens on Property sold in accordance with Section 6.13 hereof, or (C)
in an amount not to exceed Four million and No/100 Dollars ($4,000,000) in the
aggregate for Borrower and its Subsidiaries during any fiscal year of Borrower
during the term hereof; or (ii) amend or obtain or grant a waiver of any term of
any of such Indebtedness, without the prior written consent of the Required
Lenders other than in respect of inter-company transfers or inter-company
Indebtedness not otherwise prohibited hereunder. Notwithstanding the foregoing,
the Borrower may voluntarily prepay principal or interest on its or any of its
Subsidiaries' indebtedness existing on May 1, 2001 with the proceeds from the
LYONs.
6.18 Sale of Accounts. The Borrower will not, nor will it permit any
Subsidiary to, sell or otherwise dispose of any notes receivable or Accounts,
with or without recourse; provided that the foregoing shall not limit or
restrict compromises of doubtful or disputed accounts in the ordinary course of
business of Borrower and the Subsidiaries.
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6.19 Contingent Obligations. The Borrower will not, nor will it permit
any Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except for:
(i) endorsement of instruments for deposit or
collection in the ordinary course of business,
(ii) Reimbursement Obligations,
(iii) the Guaranty,
(iv) Intentionally deleted,
(v) guaranties and other Contingent Obligations
listed on Schedule 6.19(v) attached hereto,
(vi) guaranties by Borrower or any of its
Subsidiaries made in the ordinary course of business of any
payment to a vendor of goods or services to the Borrower or
its Subsidiaries or guaranties by Borrower of any obligations
of the Subsidiaries owed to any customer of Borrower or a
Subsidiary made with respect to the performance by Borrower or
such Subsidiary of a contract for the sale of goods or the
delivery of services to such customer,
(vii) such Contingent Obligations as would be
permitted to be incurred if such Contingent Obligations were
incurred as Indebtedness by such Borrower under Section 6.11,
and
(viii) reimbursement or guaranty obligations owing to
bonding companies issuing bonds on behalf of the Company or
any of its Subsidiaries incurred in the ordinary course of the
Company's business.
6.20 Letters of Credit. The Borrower will not, nor will it permit any
Subsidiary to, apply for or become liable upon or in respect of any Letter of
Credit other than Facility LCs.
6.21 Financial Contracts. The Borrower will not, nor will it permit any
Subsidiary to, enter into or remain liable upon any Financial Contract, except
Rate Hedging Agreements made for nonspeculative purposes.
6.22 Financial Covenants.
6.22.1 Leverage Ratio. Commencing with the fiscal quarter
ended February 28, 2002, and for each fiscal quarter thereafter, the
Borrower will not at any time permit the ratio of (i) Consolidated
Total Debt, to (ii) Shaw EBITDA, for the then most-recently ended four
fiscal quarters (the "Leverage Ratio"), to be greater than 2.5 to 1.0.
6.22.2 Fixed Charge Coverage Ratio. Commencing with the fiscal
quarter ended February 28, 2002, and for each fiscal quarter
thereafter, the Borrower will not, at any time, permit the ratio, for
the then most-recently ended four fiscal quarters, of (i)
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Shaw EBITDA, minus Capital Expenditures for said periods, to (ii)
Consolidated Interest Expense, plus principal payments actually paid
(or scheduled to be paid) during said periods on any Indebtedness and
cash taxes actually paid during said periods (the "Fixed Charge
Coverage Ratio") to be less than 1.50 to 1.0. Notwithstanding the
foregoing, in connection with the sale of the building located in
Houston, Texas, which sale has been approved by the Agent, payment of
principal and interest on the Indebtedness secured by such building at
the time of such sale in an amount not to exceed $20,000,000 shall not
be included in the calculation of the denominator as --- described in
(ii) above.
6.22.3 Minimum Consolidated Net Worth. The Borrower will at
all times maintain Consolidated Net Worth of not less than the sum of
(i) $494,242,000, plus (ii) 75% of Consolidated Net Income (if
positive) earned in each fiscal quarter ending subsequent to the
Effective Date, plus (iii) 90% of any amount recorded as net proceeds
on the consolidated balance sheet of the Borrower from the issuance of
any equity subsequent to the Effective Date.
6.22.4 Capital Expenditures. The Borrower will not, nor will
it permit its Subsidiaries, in the aggregate to, expend, or be
committed to expend, in excess of the greater of (i) 20% of EBITDA, or
(ii) $30,000,000 for Capital Expenditures including all Capitalized
Leases, during any one fiscal year on a non-cumulative basis in the
aggregate for the Borrower and its Subsidiaries exclusive of
acquisitions otherwise permitted under this Agreement.
6.22.5 LYONs. Only for purposes of calculating the ratio above
in Section 6.22.1, obligations of Borrower under the LYONs shall not be
included as Consolidated Total Debt.
6.23 Subsidiaries. The Borrower will, and will cause each of its
Domestic Subsidiaries to, cause any Person (whether now existing or hereafter
created) becoming a Material Subsidiary that is or becomes a Domestic Subsidiary
of the Borrower (i) to execute, in form and substance satisfactory to the Agent,
a guaranty in favor of the Agent for the benefit of the Lenders sufficient to
obligate such Subsidiary for repayment of all or a portion of the Obligations
and (ii) to execute, in form and substance satisfactory to the Agent, a security
agreement and/or other security instruments in favor of the Agent for the
benefit of the Lenders sufficient to pledge all or a portion of such
Subsidiary's assets as would constitute Collateral as security for the
Obligations. The Borrower and each Subsidiary shall have pledged at all times to
the Agent for the benefit of the Lenders 100% of Borrower's and a Domestic
Subsidiary's ownership interest in any Domestic Subsidiary that is a Material
Subsidiary and 66% of Borrower's and a Domestic Subsidiary's ownership interest
in any Foreign Subsidiary pursuant to a pledge agreement in form and substance
satisfactory to the Agent.
6.24 Acquisitions. The Borrower will not, and will not permit any
Subsidiary to, make any Acquisition without the prior written consent of the
Required Lenders. For Acquisitions for which the aggregate cash consideration
(defined as total net cash to be paid, plus Indebtedness and Contingent
Obligations to be assumed in connection with any Acquisition, plus the
Acquisition costs associated with such Acquisition) is less than $10,000,000, no
such consent shall be required so long as (i) the acquisition target is in the
same or similar line of business as
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Borrower and its subsidiaries; (ii) the Borrower or a Domestic Subsidiary is the
surviving entity holding one hundred percent (100%) of the capital stock or
membership interests in the Acquisition target; (iii) no Default or Unmatured
Default shall exist before or after any Acquisition; (iv) all Acquisitions shall
be completed in accordance with applicable laws; (v) Agent shall be provided
with satisfactory opinions with regard to any acquisition as it may request;
(vi) the terms of Section 6.23 are satisfied, and (vii) the board of directors
of the Acquisition target approves the Acquisition.
6.25 Limitation on Leases. The Borrower will not, and will not allow
its Subsidiaries to incur, on a consolidated basis, operating leases requiring
total payments of more than $16,000,000 per annum excluding operating leases
recorded in the Borrower's financial statements as cost of sales and fully
reimbursable to the Borrower by non-affiliated third parties on arm's length
terms.
6.26 Intentionally Omitted.
6.27 Payment on LYONs. Neither Borrower nor any of its Subsidiaries
shall prepay or redeem all or any portion of the LYONs for cash, whether
voluntarily or as may be required by the holders of the LYONs.
6.28 LYONs Interest Expense. Neither Borrower nor any of its
Subsidiaries shall pay cash interest expense with respect to the LYONs.
6.29 LYONs Indenture. Borrower shall not amend or agree to any
amendment of the indenture dated May 1, 2001 under which the LYONs are issued.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1 Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders or the Agent under or
in connection with this Agreement, any Credit Extension, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be materially false on the date as of which made.
7.2 Nonpayment of (i) principal when due, (ii) interest within three
(3) days of when due on any Loan, (iii) nonpayment of any Reimbursement
Obligation, or (iv) nonpayment of any commitment fee, LC Fee or other
obligations under any of the Loan Documents after the same becomes due.
7.3 The breach by the Borrower of any of the terms or provisions of
Sections 6.2, Section 6.3, or Sections 6.10 through 6.25.
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7.4 The breach by the Borrower (other than a breach which constitutes a
Default under another Section of this Article VII) of any of the terms or
provisions of this Agreement which is not remedied within fifteen (15) days.
7.5 Failure of the Borrower or any of its Subsidiaries or any
Subsidiary to pay when due any Indebtedness aggregating in excess of $2,000,000
("Material Indebtedness"); or the default by the Borrower or any of its
Subsidiaries in the performance (beyond the applicable grace period with respect
thereto, if any) of any term, provision or condition contained in any agreement
under which any such Material Indebtedness was created or is governed, or any
other event shall occur or condition exist, the effect of which default or event
is to cause, or to permit the holder or holders of such Material Indebtedness to
cause, such Material Indebtedness to become due prior to its stated maturity; or
any Material Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable or required to be prepaid or repurchased (other
than by a regularly scheduled payment) prior to the stated maturity thereof; or
the Borrower or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6 The Borrower or any of its Subsidiaries shall
(i) have an order for relief entered with respect to
it under the Federal bankruptcy laws as now or hereafter in
effect,
(ii) make an assignment for the benefit of creditors,
(iii) apply for, seek, consent to, or acquiesce in,
the appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any Substantial
Portion of its Property,
(iv) institute any proceeding seeking an order for
relief under the Federal bankruptcy laws as now or hereafter
in effect or seeking to adjudicate it a bankrupt or insolvent,
or seeking dissolution, winding up, liquidation,
reorganization, arrangement or composition of it or its debts
under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer
or other pleading denying the material allegations of any such
proceeding filed against it,
(v) take any corporate or partnership action to
authorize or effect any of the foregoing actions set forth in
this Section 7.6 or
(vi) fail to contest in good faith any appointment or
proceeding described in Section 7.7.
7.7 Without the application, approval or consent of the Borrower or any
of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries and
such appointment continues undischarged or such proceeding continues undismissed
or unstayed for a period of 30 consecutive days.
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7.8 Any court, government or governmental agency shall condemn, seize
or otherwise appropriate, or take custody or control of, all or any portion of
the Property of the Borrower or any Guarantor which, when taken together with
all other Property of the Borrower or such Guarantor so condemned, seized,
appropriated, or taken custody or control of, during the twelve-month period
ending with the month in which any such action occurs, constitutes a Substantial
Portion.
7.9 The Borrower or any of its Subsidiaries shall fail within 30 days
to pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money in excess of $2,000,000 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10 The Unfunded Liabilities of all Single Employer Plans shall exceed
in the aggregate $2,000,000 or any Reportable Event shall occur in connection
with any Plan.
7.11 The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Borrower or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification), exceeds $2,000,000 or requires
payments exceeding $500,000 per annum.
7.12 The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, if as a result of such reorganization or
termination the aggregate annual contributions of the Borrower and the other
members of the Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years of each such Multiemployer Plan immediately preceding the
plan year in which the reorganization or termination occurs by an amount
exceeding $2,000,000.
7.13 The Borrower or any of its Subsidiaries shall (i) be the subject
of any proceeding or investigation pertaining to the release by the Borrower,
any of its Subsidiaries or any other Person of any toxic or hazardous waste or
substance into the environment, or (ii) violate any Environmental Law, which, in
the case of an event described in clause (i) or clause (ii), could reasonably be
expected to have a Material Adverse Effect.
7.14 Any Change in Control shall occur.
7.15 The occurrence of any "default," as defined in any Loan Document
(other than this Agreement) or the breach of any of the terms or provisions of
any Loan Document (other than this Agreement), which default or breach continues
beyond any period of grace therein provided.
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7.16 Any Guaranty shall fail to remain in full force or effect or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Guaranty, or any Guarantor shall fail to comply with any
of the terms or provisions of any Guaranty to which it is a party, or any
Guarantor shall deny that it has any further liability under any Guaranty to
which it is a party, or shall give notice to such effect.
7.17 Any Collateral Document shall for any reason fail to create a
valid and perfected first priority security interest in any collateral purported
to be covered thereby, except as permitted by the terms of any Collateral
Document, or any Collateral Document shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Collateral Document, or the Borrower or any
Subsidiary shall fail to comply with any of the terms or provisions of any
Collateral Document.
7.18 The representations and warranties set forth in Section 5.15 (Plan
Assets; Prohibited Transactions) shall at any time not be true and correct.
7.19 The Borrower or any Subsidiary shall fail to pay when due under
any Operating Lease, any obligation with respect to a Letter of Credit, or any
Contingent Obligation.
7.20 Nonpayment by the Borrower of any Rate Hedging Obligation when due
or the breach by the Borrower of any term, provision or condition contained in
any Rate Hedging Agreement.
7.21 The occurrence of a default or an event of default under the
Indenture dated May 1, 2001 under which the LYONs are issued or any other event
which would allow all or any of the holders of the LYONs to declare the LYONs to
be immediately due and payable.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1 Acceleration; Facility LC Collateral Account.
(i) If any Default described in Section 7.6 or
Section 7.7 occurs, the obligations of the Lenders to make
Credit Extensions hereunder and the obligation and power of
the Issuer to issue Facility LCs shall automatically terminate
and the Obligations shall immediately become due and payable
without any election or action on the part of the Agent, the
Issuer or any Lender and the Borrower will be and become
thereby unconditionally obligated, without any further notice,
act or demand, to pay to the Agent an amount in immediately
available funds, which funds shall be held in the Facility LC
Collateral Account, equal to the difference of (x) the amount
of LC Obligations at such time, less (y) the amount on deposit
in the Facility LC Collateral Account at such time which is
free and clear of all rights and claims of third parties and
has not been applied against the Obligations (such difference,
the "Collateral Shortfall Amount"). If any other Default
occurs, the Required Lenders (or the Agent with the consent of
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the Required Lenders) may (a) terminate or suspend the
obligations of the Lenders to make Credit Extensions hereunder
and the obligation and power of the Issuer to issue Facility
LCs, or declare the Obligations and any affected Lender may
declare the Rate Hedging Obligations to be due and payable, or
both, whereupon the Obligations shall become immediately due
and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives,
and (b) upon notice to the Borrower and in addition to the
continuing right to demand payment of all amounts payable
under this Agreement, make demand on the Borrower to pay, and
the Borrower will, forthwith upon such demand and without any
further notice or act, pay to the Agent the Collateral
Shortfall Amount, which funds shall be deposited in the
Facility LC Collateral Account.
(ii) If at any time while any Default is continuing,
the Agent determines that the Collateral Shortfall Amount at
such time is greater than zero, the Agent may make demand on
the Borrower to pay, and the Borrower will, forthwith upon
such demand and without any further notice or act, pay to the
Agent the Collateral Shortfall Amount, which funds shall be
deposited in the Facility LC Collateral Account.
(iii) The Agent may at any time or from time to time
after funds are deposited in the Facility LC Collateral
Account, apply such funds to the payment of the Obligations
and any other amounts as shall from time to time have become
due and payable by the Borrower to the Lenders or the Issuer
under the Loan Documents.
(iv) At any time while any Default is continuing,
neither the Borrower nor any Person claiming on behalf or of
through the Borrower shall have any right to withdraw any of
the funds held in the Facility LC Collateral Account. After
all of the Obligations have been indefeasibly paid in full and
the Aggregate Commitment has been terminated, any funds
remaining, in the Facility LC Collateral Account shall be
returned by the Agent to the Borrower or paid to whomever may
be legally entitled thereto at such time.
(v) If, within 30 days after acceleration of the
maturity of the Obligations or termination of the obligations
of the Lenders to make Credit Extensions and the obligation
and power of the Issuer to issue Facility LCs hereunder as a
result of any Default (other than any Default as described in
Section 7.6 or Section 7.7 with respect to the Borrower) and
before any judgment or decree for the payment of the
Obligations due shall have been obtained or entered, the
Required Lenders (in their sole discretion) shall so direct,
the Agent shall, by notice to the Borrower, rescind and annul
such acceleration and/or termination.
8.2 Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to
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the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default hereunder; provided, however, that no
such supplemental agreement shall, without the consent of all of the Lenders:
(i) Extend the final maturity of any Loan, or extend
the expiry date of any Facility LC to a date after the
Facility Termination Date or postpone any regularly scheduled
payment of principal of any Loan or forgive all or any portion
of the principal amount thereof or any Reimbursement
Obligation related thereto, or reduce the rate or extend the
time of payment of interest or fees on any Loan or any
Reimbursement Obligations related thereto.
(ii) Reduce the percentage specified in the
definition of Required Lenders.
(iii) Extend the Facility Termination Date or reduce
the amount or extend the payment date for, the mandatory
payments required under Section 2.2, or increase the amount of
the Aggregate Commitment, the Revolving Credit Commitment or
the Facility LC Commitment or permit the Borrower to assign
its rights under this Agreement.
(iv) Amend this Section 8.2 or Section 11.2.
(v) Release any Guarantor of any Credit Extension or,
except as provided in the Collateral Documents, release any
substantial part of the Collateral during any calendar year.
For purposes of this subsection, "substantial" means any
Collateral, the aggregate book value of which is worth an
amount equal to or greater than ten percent (10%) of the
tangible net worth of Borrower calculated pursuant to
Agreement Accounting Principles per annum.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision relating to the Issuer shall be effective without the written consent
of the Issuer. The Agent may waive payment of the fee required under Section
12.3.2 without obtaining the consent of any other party to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders, the
Issuer or the Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Credit Extension notwithstanding the existence of a
Default or the inability of the Borrower to satisfy the conditions precedent to
such Credit Extension shall not constitute any waiver or acquiescence. Any
single or partial exercise of any such right shall not preclude other or further
exercise thereof or the exercise of any other right, and no waiver, amendment or
other variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in writing signed by the Lenders required
pursuant to Section 8.2, and then only to the extent in such writing
specifically set forth. All remedies contained in the Loan Documents or by law
afforded shall be cumulative and all shall be available to the Agent, the Issuer
and the Lenders until the Obligations have been paid in full.
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ARTICLE IX
GENERAL PROVISIONS
9.1 Survival of Representations. All representations and warranties of
the Borrower contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to
the contrary notwithstanding, neither the Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
9.3 Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
9.4 Entire Agreement. The Loan Documents embody the entire agreement
and understanding among the Borrower, the Agent, the Issuer and the Lenders and
supersede all prior agreements and understandings among the Borrower, the Agent,
the Issuer and the Lenders relating to the subject matter thereof other than the
fee letter described in Section 10.13. In the event of any conflict between the
terms of this Agreement and those of any other Loan Document, the terms of this
Agreement shall control, subject to the provisions of Section 9.16.
9.5 Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Section 9.6, Section 9.10 and Section 10.11 to the extent
specifically set forth therein and shall have the right to enforce such
provisions on its own behalf and in its own name to the same extent as if it
were a party to this Agreement.
9.6 Expenses; Indemnification.
(i) The Borrower shall reimburse the Agent and the
Arranger for any costs, internal charges and out-of-pocket
expenses (including attorneys' fees and time charges of
attorneys for the Agent, which attorneys may be employees of
the Agent) paid or incurred by the Agent or the Arranger in
connection with the preparation, negotiation, execution,
delivery, syndication, review, amendment, modification, and
administration of the Loan Documents. The Borrower also agrees
to reimburse the Agent, the Arranger, the Issuer and the
Lenders for any costs, internal charges and out-of-pocket
expenses (including attorneys' fees and time charges of
attorneys for the Agent, the Arranger, the Issuer and the
Lenders, which attorneys may be employees of the Agent, the
Arranger, the Issuer or the
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Lenders) paid or incurred by the Agent, the Arranger, the
Issuer or any Lender in connection with the collection and
enforcement of the Loan Documents. Expenses being reimbursed
by the Borrower under this Section include, without
limitation, the cost and expense of an annual on site
inspection and audit of Borrower's Inventory (or any other
collateral the subject of the Collateral Documents) and costs
and expenses incurred in connection with the Reports described
in the following sentence. The Borrower acknowledges that from
time to time the Agent may prepare and may distribute to the
Lenders (but shall have no obligation or duty to prepare or to
distribute to the Lenders) certain audit reports (the
"Reports") pertaining to the Borrower's assets for internal
use by the Agent from information furnished to it by or on
behalf of the Borrower, after the Agent has exercised its
rights of inspection pursuant to this Agreement.
(ii) The Borrower hereby further agrees to indemnify
the Agent, the Arranger, the Issuer and each Lender, its
directors, officers and employees against all losses, claims,
damages, penalties, judgments, liabilities and expenses
(including, without limitation, all expenses of litigation or
preparation therefor whether or not the Agent, the Arranger,
the Issuer or any Lender is a party thereto) which any of them
may pay or incur arising out of or relating to this Agreement,
the other Loan Documents, the transactions contemplated hereby
or the direct or indirect application or proposed application
of the proceeds of any Credit Extension hereunder, including
any of such arising from any of said indemnified parties' own
negligence or under any doctrine of strict liability, except
to the extent that they are determined in a final
non-appealable judgment by a court of competent jurisdiction
to have resulted from the gross negligence or willful
misconduct of the party seeking indemnification. The
obligations of the Borrower under this Section 9.6 shall
survive the termination of this Agreement.
9.7 Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders.
9.8 Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with Agreement Accounting
Principles, except that any calculation or determination which is to be made on
a consolidated basis shall be made for the Borrower and all its Subsidiaries,
including those Subsidiaries, if any, which are unconsolidated on the Borrower's
audited financial statements.
9.9 Severability of Provisions. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10 Nonliability of Lenders. The relationship between the Borrower on
the one hand and the Lenders, the Issuer and the Agent on the other hand shall
be solely that of borrower and
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lender. Neither the Agent, the Arranger, the Issuer nor any Lender shall have
any fiduciary responsibilities to the Borrower. Neither the Agent, the Arranger,
the Issuer 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 the Agent,
the Arranger, the Issuer 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 from the gross negligence or
willful misconduct of the party from which recovery is sought. Neither the
Agent, the Arranger, the Issuer 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 in
connection with, arising out of, or in any way related to the Loan Documents or
the transactions contemplated thereby.
9.11 Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as required by law, regulation, or legal process,
(v) to any Person in connection with any legal proceeding to which such Lender
is a party, (vi) to such Lender's direct or indirect contractual counterparties
in swap agreements or to legal counsel, accountants and other professional
advisors to such counterparties, and (vii) permitted by Section 12.4.
9.12 Nonreliance. Each Lender hereby represents that it is not relying
on or looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Credit
Extensions provided for herein.
9.13 Disclosure. Each party hereto (i) acknowledges and agrees that the
Agent, Issuer or any Lender and/or their respective Affiliates from time to time
may hold other investments in, make other loans to or have other relationships
with the Borrower and its Subsidiaries, and (ii) waive any liability of any such
party to any other party hereto, respectively, arising out of or resulting from
such investments, loans or relationships other than liabilities arising out of
the gross negligence or willful misconduct of the party holding such investment,
making such other loan or having such other relationship with the Borrower and
its Subsidiaries.
9.14 Interest. Each provision in this Agreement and each other Loan
Document is expressly limited so that in no event whatsoever shall the amount
paid, or otherwise agreed to be paid, to the Agent or any Lender, or charged,
contracted for, reserved, taken or received by the Agent or any Lender, for the
use, forbearance or detention of the money to be loaned under this Agreement or
any Loan Document or otherwise (including any sums paid as required by any
covenant or obligation contained herein or in any other Loan Document which is
for the use, forbearance or detention of such money), exceed that amount of
money which would cause the effective rate of interest to exceed the Highest
Lawful Rate, and all amounts owed under this Agreement and each other Loan
Document shall be held to be subject to reduction to the effect that such
amounts so paid or agreed to be paid, charged, contracted for, reserved, taken
or
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received which are for the use, forbearance or detention of money under this
Agreement or such Loan Document shall in no event exceed that amount of money
which would cause the effective rate of interest to exceed the Highest Lawful
Rate. Anything herein or in any Note or any other Loan Document to the contrary
notwithstanding, the Borrower shall not be required to pay unearned interest and
the Borrower shall not be required to pay interest on the Obligations at a rate
in excess of the Highest Lawful Rate, and if the effective rate of interest
which would otherwise be payable hereunder, under such Note or such Loan
Documents would exceed the Highest Lawful Rate, or if any Lender or the holder
of such Note shall receive any unearned interest or shall receive monies that
are deemed to constitute interest which would increase the effective rate of
interest payable by the Borrower hereunder or under such Note or other Loan
Documents to a rate in excess of the Highest Lawful Rate, then (a) the amount of
interest which would otherwise be payable by the Borrower shall be reduced to
the amount allowed under applicable law and (b) any unearned interest paid by
the Borrower or any interest paid by the Borrower in excess of the Highest
Lawful Rate shall in the first instance be credited on the principal of the
Obligations of the Borrower (or if all such Obligations shall have been paid in
full, refunded to the Borrower). It is further agreed that, without limitation
of the foregoing, all calculations of the rate of interest contracted for,
reserved, taken, charged or received by any Lender under the Notes and the
Obligations and under the other Loan Documents are made for the purpose of
determining whether such rate exceeds the Highest Lawful Rate, and shall be
made, to the extent permitted by usury laws applicable to such Lender, by
amortizing, prorating and spreading in equal parts during the period of the full
stated term of the Notes and this Agreement all interest at any time contracted
for, charged or received by such Lender in connection therewith. Furthermore, in
the event that the maturity of any Obligation is accelerated or in the event of
any required or permitted prepayment, then such consideration that constitutes
interest under applicable law may never include more than the maximum amount
allowed by applicable law and excess interest, if any, provided for in this
Agreement, any Note or otherwise shall be canceled automatically as of the date
of such acceleration or prepayment and, if theretofore paid, shall be refunded
to the Borrower.
9.15 Excess Share Certificates. The Agent and the Lenders acknowledge
that circumstances have required that the Borrower deliver to Agent such stock
certificates of Foreign Subsidiaries as were available at July 14, 2000, the
closing date for the July Credit Agreement, and in some cases, while the
Borrower has agreed to pledge to the Agent and the Lenders only 66% of the
Capital Stock of first tier Foreign Subsidiaries, the Borrower has in fact
delivered to Agent stock certificates representing, in some cases, 100% of the
Capital Stock of certain Foreign Subsidiaries. Lender and Agent acknowledge and
agree that in no event shall Agent or any Lender be deemed to have (and they
each hereby disclaim and deny) any Lien upon, security interest in or claim upon
any shares of Capital Stock in excess of 66% thereof, and the Agent and the
Lenders agree to surrender such stock certificates as may evidence more than 66%
of the Capital Stock of any Foreign Subsidiary to the Borrower upon request of
Borrower, in exchange for a stock certificate representing 66% of the Capital
Stock of any such Foreign Subsidiary.
9.16 Survival of Prior Agreements. The rights and privileges afforded
the Agent and the Arranger in that certain Commitment Letter and that certain
Fee Letter, both dated January 2, 2002 among said parties and Borrower shall
survive the execution of this Agreement and the Effective Date and Agent and
Arranger shall continue to be entitled to the benefits thereof.
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9.17 Guarantor's Acknowledgment and Consent. The Borrower is a party to
certain Collateral Documents pursuant to which the Borrower has created Liens in
favor of the Agent on certain Collateral to secure the Obligations. Each of the
Guarantors party hereto is a party to certain Collateral Documents and the
Guaranty, pursuant to which each such Guarantor has (i) guarantied the
Obligations and (ii) created Liens in favor of the Agent on behalf of the
Lenders on certain Collateral to secure the Secured Obligations. The Collateral
Documents and the Guaranty are collectively referred to herein as the "Credit
Support Documents."
Each Guarantor hereby acknowledges that it has reviewed the
terms and provisions of this Agreement, the Collateral Documents and the
Guaranty and consents to the further amendment of the Original Credit Agreement
pursuant to this Agreement. Each Guarantor hereby confirms that each Credit
Support Document to which it is a party or otherwise bound and all Collateral
encumbered thereby will continue to guaranty or secure, as the case may be, to
the fullest extent possible the payment and performance of all "Secured
Obligations," as the case may be (in each case as such terms are defined in the
applicable Credit Support Document), including without limitation the payment
and performance of all such "Obligations," "Guaranteed Debt" or "Secured
Obligations," as the case may be, in respect of the Obligations of the Borrower
now or hereafter existing under or in respect of this Agreement and the Notes.
Each Guarantor acknowledges and agrees that any of the Credit
Support Documents to which it is a party or otherwise bound shall continue in
full force and effect and that all of its obligations thereunder shall be valid
and enforceable and shall not be impaired or limited by the execution or
effectiveness of this Agreement. Each Guarantor represents and warrants that all
representations and warranties contained in this Agreement and the other Credit
Support Documents to which it is a party or otherwise bound are true, correct
and complete in all material respects on and as of the date hereof to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case they were true, correct and complete in all material respects on and as of
such earlier date.
Each Guarantor acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Agreement,
such Guarantor is not required by the terms of the Original Credit Agreement,
this Agreement or any other Loan Document to consent to the amendments to the
Original Credit Agreement effected pursuant to this Agreement, and (ii) nothing
in the Original Credit Agreement, this Agreement or any other Loan Document
shall be deemed to require the consent of such Guarantor to any future
amendments to this Agreement.
ARTICLE X
THE AGENT
10.1 Appointment; Nature of Relationship. Bank One is hereby appointed
by each of the Lenders as its contractual representative (herein referred to as
the "Agent") hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use
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of the defined term "Agent," it is expressly understood and agreed that the
Agent shall not have any fiduciary responsibilities to any Lender by reason of
this Agreement or any other Loan Document and that the Agent is merely acting as
the contractual representative of the Lenders with only those duties as are
expressly set forth in this Agreement and the other Loan Documents. In its
capacity as the Lenders' contractual representative, the Agent (i) does not
hereby assume any fiduciary duties to any of the Lenders, (ii) is a
"representative" of the Lenders within the meaning of Section 9-105 of the
Uniform Commercial Code and (iii) is acting as an independent contractor, the
rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents. Each of the Lenders hereby agrees to
assert no claim against the Agent on any agency theory or any other theory of
liability for breach of fiduciary duty, all of which claims each Lender hereby
waives.
10.2 Powers. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3 General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4 No Responsibility for Loans, Recitals, etc. Neither the Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into, or verify (a) any statement, warranty
or representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of the Borrower or any
guarantor of any of the Obligations or of any of the Borrower's or any such
guarantor's respective Subsidiaries. The Agent shall have no duty to disclose to
the Lenders information that is not required to be furnished by the Borrower to
the Agent at such time, but is voluntarily furnished by the Borrower to the
Agent (either in its capacity as Agent or in its individual capacity).
10.5 Action on Instructions of Lenders. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders or 100% of the Lenders where required hereunder, and such
instructions and any action taken or failure to act pursuant thereto shall be
binding on all of the Lenders. The Lenders hereby acknowledge that the Agent
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shall be under no duty to take any discretionary action permitted to be taken by
it pursuant to the provisions of this Agreement or any other Loan Document
unless it shall be requested in writing to do so by the Required Lenders. The
Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Loan Document unless it shall first be indemnified
to its satisfaction by the Lenders pro rata against any and all liability, cost
and expense that it may incur by reason of taking or continuing to take any such
action.
10.6 Employment of Agents and Counsel. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7 Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8 Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of the Loan
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including, without limitation, for any such
amounts incurred by or asserted against the Agent in connection with any dispute
between the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms of the Loan Documents or of any such other
documents, including any of such arising from the Agent's own negligence or
under any doctrine of strict liability, provided that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Agent and (ii)
any indemnification required pursuant to Section 3.5(vii) shall, notwithstanding
the provisions of this Section 10.8, be paid by the relevant Lender in
accordance with the provisions thereof. The obligations of the Lenders under
this Section 10.8 shall survive payment of the Obligations and termination of
this Agreement.
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10.9 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or the Borrower referring to
this Agreement describing such Default or Unmatured Default and stating that
such notice is a "notice of default." In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Lenders. Receipt by
Agent of a notice of termination from any of the Guarantors under the
"Termination" Section of the Guaranty shall be a notice of default.
10.10 Rights as a Lender. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Credit Extensions as any Lender
and may exercise the same as though it were not the Agent, and the term "Lender"
or "Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
10.12 Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If no successor Agent
shall have been so appointed by the Required Lenders within thirty days after
the resigning Agent's giving notice of its intention to resign, then the
resigning Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Agent. Notwithstanding the previous sentence, the Agent may at any
time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder
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by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the resigning or
removed Agent. Upon the effectiveness of the resignation or removal of the
Agent, the resigning or removed Agent shall be discharged from its duties and
obligations hereunder and under the Loan Documents. After the effectiveness of
the resignation or removal of an Agent, the provisions of this Article X shall
continue in effect for the benefit of such Agent in respect of any actions taken
or omitted to be taken by it while it was acting as the Agent hereunder and
under the other Loan Documents. In the event that there is a successor to the
Agent by merger, or the Agent assigns its duties and obligations to an Affiliate
pursuant to this Section 10.12, then the term "Corporate Base Rate" as used in
this Agreement shall mean the prime rate, base rate or other analogous rate of
the new Agent.
10.13 Agent's Fee. The Borrower agrees to pay to the Agent, for its own
account, the fees agreed to by the Borrower and the Agent pursuant to that
certain Fee Letter between the Agent and the Borrower dated January 2, 2002, or
as otherwise agreed from time to time.
10.14 Delegation to Affiliates. The Borrower and the Lenders agree that
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Article IX and
Article X.
10.15 Execution of Collateral Documents. The Lenders hereby empower and
authorize the Agent to execute and deliver to the Borrower on their behalf the
Collateral Documents and all related financing statements and any financing
statements, agreements, documents or instruments as shall be necessary or
appropriate to effect the purposes of the Collateral Documents.
10.16 Collateral Releases. The Lenders hereby empower and authorize the
Agent to execute and deliver to the Borrower on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of Collateral which shall be permitted by the terms hereof or of any
other Loan Document or which shall otherwise have been approved by the Required
Lenders (or, if required by the terms of Section 8.2, all of the Lenders) in
writing.
10.17 Agents. Notwithstanding anything herein to the contrary, none of
Credit Lyonnais New York Branch as Documentation Agent, U.S. Bank National
Association, as Syndication Agent or Union Planters Bank, N.A., as Co-Agent, nor
any of their successors and assigns as Agents (other than as the Agent) shall
have any duties, obligations or liabilities as Agents (other than as the Agent)
in addition to or different from any duties, obligations or liabilities such
entities have as Lenders.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1 Setoff. In addition to, and without limitation of, any rights of
the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs,
-69-
any and all deposits (including all account balances, whether provisional or
final and whether or not collected or available) and any other Indebtedness at
any time held or owing by any Lender or any Affiliate of any Lender to or for
the credit or account of the Borrower may be offset and applied toward the
payment of the Obligations owing to such Lender, whether or not the Obligations,
or any part hereof, shall then be due.
11.2 Ratable Payments. If any Lender, whether by setoff or otherwise,
has payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.1, Section 3.2, Section 3.4 or Section 3.5) in a
greater proportion than that received by any other Lender, such Lender agrees,
promptly upon demand, to purchase a portion of the Aggregate Outstanding Credit
Exposure held by the other Lenders so that after such purchase each Lender will
hold its Pro Rata Share of the Aggregate Outstanding Credit Exposure. If any
Lender, whether in connection with setoff or amounts which might be subject to
setoff or otherwise, receives collateral or other protection for its Obligations
or such amounts which may be subject to setoff, such Lender agrees, promptly
upon demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their respective Pro Rata
Shares of the Aggregate Outstanding Credit Exposure. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (ii) of this Section, any Lender may
at any time, without the consent of the Borrower or the Agent, assign all or any
portion of its rights under this Agreement and any Note to a Federal Reserve
Bank; provided, however, that no such assignment to a Federal Reserve Bank shall
release the transferor Lender from its obligations hereunder. The Agent may
treat the Person which made any Credit Extension or which holds any Note as the
owner thereof for all purposes hereof unless and until such Person complies with
Section 12.3 in the case of an assignment thereof or, in the case of any other
transfer, a written notice of the transfer is filed with the Agent. Any assignee
or transferee of the rights to any Credit Extension or any Note agrees by
acceptance of such transfer or assignment to be bound by all the terms and
provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the owner of the rights to any Credit Extension (whether or not a
Note has been issued in evidence thereof), shall be conclusive and binding on
any subsequent holder, transferee or assignee of the rights to such Credit
Extension.
12.2 Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time sell to one or more
-70-
banks or other entities ("Participants") participating interests in any
Outstanding Credit Exposure of such Lender, any Note held by such
Lender, any Commitment of such Lender or any other interest of such
Lender under the Loan Documents. In the event of any such sale by a
Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, such Lender shall remain the owner
of its Outstanding Credit Exposure and the holder of any Note issued to
it in evidence thereof for all purposes under the Loan Documents, all
amounts payable by the Borrower under this Agreement shall be
determined as if such Lender had not sold such participating interests,
and the Borrower and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right
to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other
than any amendment, modification or waiver with respect to any Credit
Extension or Commitment in which such Participant has an interest which
forgives principal, interest, or any Reimbursement Obligation or
reduces the interest rate or fees payable with respect to any such
Credit Extension or Commitment, extends the Facility Termination Date,
postpones any date fixed for any regularly-scheduled payment of
principal of or interest on any Loan in which such Participant has an
interest, or any regularly-scheduled payment of fees on any such Credit
Extension or Commitment, releases any guarantor of any such Credit
Extension or releases any collateral held in the Facility LC Collateral
Account (except in accordance with the terms hereof) or all or
substantially all of any other collateral, if any, securing any such
Credit Extension.
12.2.3 Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Participant were a Lender.
12.3 Assignments.
12.3.1 Permitted Assignments. Any Lender may, in the ordinary
course of its business and in accordance with applicable law, at any
time assign to one or more banks or other entities ("Purchasers") all
or any part of its rights and obligations under the Loan Documents,
provided any such assignment must be of a Pro Rata Share of both the
Revolving Credit Commitment and the Facility LC Commitment of such
assignor. Such assignment shall be substantially in the form of Exhibit
12.3.1 or in such other form as may be agreed to by the parties
thereto. The consent of the Borrower, the Issuer and the
-71-
Agent shall be required prior to an assignment becoming effective with
respect to a Purchaser which is not a Lender or an Affiliate thereof;
provided if a Default has occurred and is continuing, the consent of
the Borrower shall not be required. Such consent shall not be
unreasonably withheld or delayed ; provided, however, that in the event
that the prospective assignee is unable or unwilling to deliver to the
Borrower Forms 1001 or 4224 (or successor forms, as applicable)
demonstrating such assignee's exemption from United States Taxes with
respect to all interest payments to be made to such assignee hereunder,
then such inability or unwillingness shall constitute a reasonable
basis for refusing to consent to such transfer. Each such assignment
with respect to a Purchaser which is not a Lender or an Affiliate
thereof shall (unless each of the Borrower and the Agent otherwise
consents) be in an amount not less than the lesser of (i) $5,000,000 or
(ii) the remaining amount of the assigning Lender's Commitment
(calculated as at the date of such assignment) or outstanding Credit
Extensions (if the applicable Commitment has been terminated).
12.3.2 Effect; Effective Date. Upon (i) delivery to the Agent
of an assignment, together with any consents required by Section
12.3.1, and (ii) payment of a $4,000 fee to the Agent for processing
such assignment (unless such fee is waived by the Agent), such
assignment shall become effective on the effective date specified in
such assignment. The assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Outstanding Credit Exposure under the
applicable assignment agreement constitutes "plan assets" as defined
under ERISA and that the rights and interests of the Purchaser in and
under the Loan Documents will not be "plan assets" under ERISA. On and
after the effective date of such assignment, such Purchaser shall for
all purposes be a Lender party to this Agreement and any other Loan
Document executed by or on behalf of the Lenders and shall have all the
rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto, and no further
consent or action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to the
percentage of the Aggregate Commitment and Outstanding Credit Exposure
assigned to such Purchaser. Upon the consummation of any assignment to
a Purchaser pursuant to this Section 12.3.2, the transferor Lender, the
Agent and the Borrower shall, if the transferor Lender or the Purchaser
desires that its Loans be evidenced by Notes, make appropriate
arrangements so that new Notes or, as appropriate, replacement Notes
are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser, in each case in
principal amounts reflecting their respective Commitments, as adjusted
pursuant to such assignment.
12.4 Dissemination of Information. The Borrower authorizes each Lender
to disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
-72-
12.5 Tax Treatment. If any interest in any Loan Document is transferred
to any Transferee which is organized under the laws of any jurisdiction other
than the United States or any State thereof, the transferor Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with the provisions of Section 3.5(iv).
ARTICLE XIII
NOTICES
13.1 Notices. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower or the Agent, at its address or facsimile number set
forth on the signature pages hereof, (y) in the case of any Lender, at its
address or facsimile number set forth on its signature page hereof or (z) in the
case of any party, at such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agent and the Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (i) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Article II shall not
be effective until received.
13.2 Change of Address. The Borrower, the Agent and any Lender may each
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent, the Issuer and the Lenders and each party has notified the Agent by
facsimile transmission or telephone that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION;
WAIVER OF JURY TRIAL
15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO
-73-
NATIONAL BANKS. WITHOUT LIMITATION OF THE FOREGOING, NOTHING IN THIS AGREEMENT,
OR IN THE NOTES OR IN ANY OTHER LOAN DOCUMENT SHALL BE DEEMED TO CONSTITUTE A
WAIVER OF ANY RIGHTS WHICH ANY LENDER MAY HAVE UNDER APPLICABLE FEDERAL
LEGISLATION RELATING TO THE AMOUNT OF INTEREST WHICH SUCH LENDER MAY CONTRACT
FOR, TAKE, RECEIVE OR CHARGE IN RESPECT OF THE LOAN AND THE LOAN DOCUMENTS,
INCLUDING ANY RIGHT TO TAKE, RECEIVE, RESERVE AND CHARGE INTEREST AT THE RATE
ALLOWED BY THE LAW OF THE STATE WHERE ANY LENDER IS LOCATED.
15.2 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE AGENT, THE ISSUER OR ANY LENDER TO BRING PROCEEDINGS AGAINST
THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY
THE BORROWER AGAINST THE AGENT, THE ISSUER OR ANY LENDER OR ANY AFFILIATE OF THE
AGENT, THE ISSUER OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.
15.3 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, THE ISSUER AND EACH
LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY
OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
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IN WITNESS WHEREOF, the Borrower, the Guarantors, the Lenders and the
Agent have executed this Agreement as of the date first above written.
THE SHAW GROUP INC.
By:
--------------------------------------
Name: Robert L. Belk
Title: Executive Vice President and
Chief Financial Officer
Address: 8545 United Plaza Boulevard
Baton Rouge, Louisiana 70809
Attention: Robert L. Belk
Telephone: 225-932-2567
Telecopy: 225-932-9146
E-Mail: bob.belk@shawgrp.com
S-1
GUARANTORS:
ACL Piping, Inc.
Associated Valve, Inc.
B.F. Shaw, Inc.
Eagle Industries, Inc.
Gulf Coast Equipment Rental, Inc.
IRM/NAPTech Joint Venture, L.L.C.
Lone Star Fabricators, Inc.
NAPTech PS Corporation
Prospect Industries (Holdings), Inc.
SAON Properties, Inc.
Secorp, Inc.
Shaw Alloy Piping Products, Inc.
Shaw Capital, Inc.
Shaw Connex, Inc.
Shaw Constructors, Inc.
Shaw Energy Services, Inc.
Shaw Fabricators, Inc.
Shaw Fronek A/DE, Inc.
Shaw Fronek Company, Inc.
Shaw-Fronek Fabrication, Inc.
Shaw Fronek Power Services, Inc.
Shaw FVF, Inc.
Shaw Global Energy Services, Inc.
Shaw GRP of California
Shaw Industrial Supply Co., Inc.
Shaw International, Inc.
Shaw Maintenance, Inc.
Shaw Managed Services, Inc.
Shaw Manufacturing and Services, Inc.
Shaw NAPTech, Inc.
Shaw Pipe Shields, Inc.
Shaw Power Services, Inc.
Shaw Process and Industrial Group, Inc.
Shaw Process Fabricators, Inc.
Shaw Services Inc.
Shaw Sunland Fabricators, Inc.
Shaw Word Industries Fabricators, Inc.
Stone & Webster Holding One, Inc.
Stone & Webster Holding Two, Inc.
Stone & Webster, Inc.
SWINC Acquisition Four, Inc.
S-2
SWINC Acquisition Five, L.L.C.
Welding Technology and Supply Inc.
Worldwide Industrial Constructors Inc.
By:
------------------------------------------
Name: Gary Graphia
Title: Secretary
S-3
BANK ONE, NA,
as Agent, as a Lender and as Issuer
By:
------------------------------------------
Name: William B. Winters
Title: Director
Address: c/o Bank One Center,
1717 Main Street, 3rd Floor
Dallas, Texas 75201
Attention: Bill Winters
Telephone: 214-290-2483
Telecopy: 214-290-2305
E-Mail: bill_winters@bankone.com
COMMITMENT: $40,000,000
S-4
CREDIT LYONNAIS NEW YORK BRANCH,
as Documentation Agent and as a Lender
By:
--------------------------------------------
Name:
------------------------------------------
Title:
-----------------------------------------
COMMITMENT: $40,000,000
S-5
U.S. BANK NATIONAL ASSOCIATION, as
Syndication Agent and as a Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
COMMITMENT: $40,000,000
S-6
UNION PLANTERS BANK, N.A., as Co-Agent
and as a Lender
By:
------------------------------------------
Name:
------------------------------------------
Title:
------------------------------------------
COMMITMENT: $35,000,000
S-7
BNP PARIBAS HOUSTON AGENCY
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $33,000,000
S-8
HARRIS TRUST & SAVINGS BANK
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $24,000,000
S-9
WACHOVIA BANK, N.A.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $18,000,000
S-10
THE BANK OF NOVA SCOTIA
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $24,000,000
S-11
THE MITSUBISHI TRUST & BANKING
CORPORATION
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $15,000,000
S-12
ROYAL BANK OF SCOTLAND
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $18,000,000
S-13
KBC BANK N.V.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $24,000,000
S-14
BANK HAPOALIM B.M., CHICAGO
BRANCH
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $18,000,000
S-15
NATEXIS BANQUES POPULAIRES
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $6,000,000
S-16
WELLS FARGO BANK TEXAS, N.A.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
COMMITMENT: $15,000,000
S-17
BANC ONE CAPITAL MARKETS, INC.,
as Lead Arranger and Sole Book Runner
By:
------------------------------------
Name: Matthew Cannan
Title: Associate Director
Address: 1 Bank One Plaza
Mail Suite 0429
Chicago, IL 60670
Attention: Matthew Cannan
Telephone: (312) 732-4744
Telecopy: (312) 732-2117
Email: matthew_j_cannan@
bankone.com
S-18
PRICING SCHEDULE
<Table>
<Caption>
Applicable Applicable Financial Performance Commitment
Level Leverage Ratio LIBOR Margin ABR Margin L/C Fee L/C Fee Fee
- ---------- -------------------- ------------ ---------- --------- ----------- ----------
I <1.00x 1.500% 0% 1.500% 1.125% 0.375%
II #1.00x, <1.50x 1.750% 0.25% 1.750% 1.313% 0.375%
III #1.50x, <2.00x 2.000% 0.50% 2.000% 1.500% 0.375%
IV #2.00x 2.250% 0.75% 2.250% 1.688% 0.500%
</Table>
o In addition, L/C Issuing Bank receives 12.5bps fronting fee.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Borrower's Status as reflected
in the then most recent financial statements described in Section 6.1(i) and
Section 6.1(ii) of the Credit Agreement (the "Financials"). Adjustments, if any,
to the Applicable Margin or Applicable Fee Rate shall be effective five Business
Days after the Agent has received the applicable Financials. If the Borrower
fails to deliver the Financials to the Agent at the time required pursuant to
the Credit Agreement, then the Applicable Margin and Applicable Fee Rate shall
be the highest Applicable Margin and Applicable Fee Rate set forth in the
foregoing table until five days after such Financials are so delivered.
Exhibits and Schedules - Page 1
EXHIBIT 2.13(iv)
NOTE
[DATE]
The Shaw Group Inc., a Louisiana corporation (the "Borrower"), promises
to pay to the order of ____________________________________ (the "Lender") the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Article II of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, NA in Chicago,
Illinois, ______________________, together with interest on the unpaid principal
amount hereof at the rates and on the dates set forth in the Agreement. The
Borrower shall pay the principal of and accrued and unpaid interest on the Loans
in full on the Facility Termination Date.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or otherwise record in accordance with its usual practice, the
date and amount of each Loan and the date and amount of each principal payment
hereunder.
This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Second Amended and Restated Credit Agreement dated as of
_______________, 2002 (which, as it may be amended or modified and in effect
from time to time, is herein called the "Agreement"), among the Borrower, the
lenders party thereto, including the Lender and Bank One, NA, as Issuer and as
Agent. Reference is hereby made to this Agreement for a statement of the terms
and conditions governing this Note, including the terms and conditions under
which this Note may be prepaid or its maturity date accelerated. This Note is
secured pursuant to the Collateral Documents and guaranteed pursuant to the
Guaranty, all as more specifically described in the Agreement, and reference is
made thereto for a statement of the terms and provisions thereof. Capitalized
terms used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
THE SHAW GROUP INC.
By:
----------------------------------------
Print Name:
--------------------------------
Title:
-------------------------------------
Exhibits and Schedules - Page 2
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF _______________,
DATED _______________,
<Table>
<Caption>
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
- --------------------------------------------------------------------------
</Table>
Exhibits and Schedules - Page 3
EXHIBIT 4.1(v)
FORM OF GUARANTOR'S SOLVENCY CERTIFICATE
To: The Lenders parties to the
Credit Agreement Described Below
This Solvency Certificate is furnished pursuant to that certain
Guaranty dated as of July 14, 2000 (as amended, modified, renewed or extended
from time to time, the "Guaranty") executed by ________________, a
_____________________ (the "Guarantor") to the Agent for the benefit of the
Lenders party to that certain Second Amended and Restated Credit Agreement dated
_______________, 2002 ( as amended, modified, renewed or extended from time to
time, the "Agreement") among The Shaw Group Inc., as the Borrower, Bank One, NA,
as a Lender, the Agent and the Issuer and the Lenders party thereto. Unless
otherwise defined herein, capitalized terms used in this Solvency Certificate
have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected Chief Financial Officer of the
Guarantor;
2. (i) Immediately after the consummation of the transactions to
occur on the date hereof and immediately following the making
of each Credit Extension, if any, made on the date hereof and
after giving effect to the application of the proceeds of such
Credit Extension, (a) the fair value of the assets of the
Guarantor and its Subsidiaries on a consolidated basis, at a
fair valuation, will exceed the debts and liabilities,
subordinated, contingent or otherwise, of the Guarantor and
its Subsidiaries on a consolidated basis; (b) the present fair
saleable value of the Property of the Guarantor and its
Subsidiaries on a consolidated basis will be greater than the
amount that will be required to pay the probable liability of
the Guarantor and its Subsidiaries on a consolidated basis on
their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute
and matured; (c) the Guarantor and its Subsidiaries on a
consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) the
Guarantor and its Subsidiaries on a consolidated basis will
not have unreasonably small capital with which to conduct the
businesses in which they are engaged as such businesses are
now conducted and are proposed to be conducted after the date
hereof.
(ii) The Guarantor does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its
Subsidiaries will, incur debts beyond its ability to pay such
debts as they mature, taking into account the timing of and
amounts of cash to be received by it or any such Subsidiary
and the timing of the amounts of cash to be payable on or in
respect of its Indebtedness or the Indebtedness of any such
Subsidiary.
Exhibits and Schedules - Page 4
Executed this _____ day of _______________, 2002.
[GUARANTOR]
By:
------------------------------------------
Name:
----------------------------------------
Chief Financial Officer
Exhibits and Schedules - Page 5
EXHIBIT 4.1 (vii)
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To Bank One, NA, as Agent
(the "Agent") under the Credit Agreement Described Below.
Re: Second Amended and Restated Credit Agreement, dated _______________,
2002 (as the same may be amended or modified, the "Credit Agreement"),
among The Shaw Group Inc., a Louisiana corporation (the "Borrower"),
the Lenders named therein, the Issuer and the Agent. Capitalized terms
used herein and not otherwise defined herein shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s)
[TO BE DETERMINED]
- --------------------------------------------------------------------------------
Customer/Account Name: Shaw Group Inc.
---------------------------------------------------------
Transfer Funds To:
Bank One, NA, Chicago, Illinois
- --------------------------------------------------------------------------------
ABA Number: 071000013
- --------------------------------------------------------------------------------
For Account No. 1059633
----------------------------------------------------------------
Reference/Attention To:
Kathleen Murphy (312) 732-5033
- --------------------------------------------------------------------------------
Authorized Officer (Customer Representative) Date
---------------------------------
- ------------------------------------ -------------------------------------
(Please Print) Signature
Bank Officer Name Date
-------------------------------------
- ------------------------------------ -------------------------------------
(Please Print) Signature
(DELIVER COMPLETED FORM TO CREDIT SUPPORT STAFF FOR IMMEDIATE PROCESSING)
Exhibits and Schedules - Page 6
EXHIBIT 6.1(iv)
COMPLIANCE CERTIFICATE
To: The Lenders party to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain
Second Amended and Restated Credit Agreement dated as of _______________, 2002
(as amended, modified, renewed or extended from time to time, the "Agreement")
among The Shaw Group Inc., a Louisiana corporation (the "Borrower"), the lenders
party thereto and Bank One, NA, as Agent for the Lenders and as Issuer. Unless
otherwise defined herein, capitalized terms used in this Compliance Certificate
have the meanings attributed to them in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected chief financial officer of the Borrower.
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements.
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
a Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below.
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain covenants of the
Agreement, all of which data and computations are true, complete and correct.
5. Schedule II attached hereto sets forth the determination of the
interest rates to be paid for Advances, the LC Fee rates and the commitment fee
rates commencing on the fifth day following the delivery hereof.
6. Schedule III attached hereto sets forth the various reports and
deliveries which are required at this time under the Agreement, the Security
Agreements and the other Loan Documents and the status of compliance.
Described below are the exceptions, if any, to paragraph 3 listing the
nature and stating the condition or event which constitutes a Default or
Unmatured Default, the period during which it has existed and the action which
the Borrower has taken, is taking, or proposes to take with respect to each such
condition or event:
----------------------------------------------------------------
----------------------------------------------------------------
Exhibits and Schedules - Page 7
----------------------------------------------------------------
----------------------------------------------------------------
The foregoing certifications, together with the schedules attached
hereto and the financial statements delivered with this Certificate in support
hereof, are made and delivered this _____ day of _______________, _______.
The Shaw Group Inc.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Exhibits and Schedules - Page 8
SCHEDULE I TO COMPLIANCE CERTIFICATE
COMPLIANCE AS OF _________, ____ WITH
PROVISIONS OF SECTION 6.22 OF
THE AGREEMENT
Exhibits and Schedules - Page 9
SCHEDULE II TO COMPLIANCE CERTIFICATE
BORROWER'S APPLICABLE MARGIN CALCULATION
Exhibits and Schedules - Page 10
SCHEDULE III TO COMPLIANCE CERTIFICATE
REPORTS AND DELIVERIES CURRENTLY DUE
Exhibits and Schedules - Page 11
EXHIBIT 12.3.1
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
_______________ ___________________(the "Assignor") and
_________________________ (the "Assignee") is dated as of _____________, 20___.
The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement
(which, as it may be amended, modified, renewed or extended from time to time is
herein called the "Credit Agreement") described in Item 1 of Schedule 1 attached
hereto ("Schedule 1"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings attributed to them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement and the other Loan Documents, such that after giving effect to such
assignment the Assignee shall have purchased pursuant to this Assignment
Agreement the percentage interest specified in Item 3 of Schedule 1 of all
outstanding rights and obligations under the Credit Agreement and the other Loan
Documents relating to the facilities listed in Item 3 of Schedule 1. The
aggregate Commitment (or Loans, if the applicable Commitment has been
terminated) purchased by the Assignee hereunder is set forth in Item 4 of
Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two Business Days (or such shorter period agreed to by the Agent) after
this Assignment Agreement, together with any consents required under the Credit
Agreement, are delivered to the Agent. In no event will the Effective Date occur
if (i) the payments required to be made by the Assignee to the Assignor on the
Effective Date are not made on the proposed Effective Date and (ii) the payment
of the recordation fee, described in Section 5 of this Assignment Agreement, is
not made to the Agent on or before the Effective Date. If the Assignee is not
incorporated under the laws of the United States of America or a state thereof,
the Effective Date will not occur unless the Assignee delivers to the Borrower
and the Agent concurrently with the Effective Date two duly completed copies of
United States Internal Revenue Service Form 1001 or 4224 (or replacement or
successor forms, as the case may be), certifying in either case that the
Assignee is entitled to receive payments under the Loan Documents without
deduction or withholding of any United States federal income taxes.
4. PAYMENT OBLIGATIONS. In consideration for the sale and assignment of
Outstanding Credit Exposure hereunder, the Assignee shall pay the Assignor, on
the Effective Date, the amount agreed to by the Assignor and the Assignee. On
and after the Effective Date, the Assignee shall be entitled to receive from the
Agent all payments of principal, interest, Reimbursement Obligations and fees
with respect to the interest assigned hereby. The Assignee will promptly remit
to the Assignor any interest on Credit Extensions and fees received from the
Agent which relate to the portion of the Commitment or Outstanding Credit
Exposure assigned
Exhibits and Schedules - Page 12
to the Assignee hereunder for periods prior to the Effective Date and not
previously paid by the Assignee to the Assignor. In the event that either party
hereto receives any payment to which the other party hereto is entitled under
this Assignment Agreement, then the party receiving such amount shall promptly
remit it to the other party hereto.
5. RECORDATION FEE. The Assignor and Assignee each agree to pay
one-half of the recordation fee required to be paid to the Agent in connection
with this Assignment Agreement unless otherwise specified in Item 6 of Schedule
1.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder, (ii) such
interest is free and clear of any adverse claim created by the Assignor and
(iii) the execution and delivery of this Assignment Agreement by the Assignor is
duly authorized. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor makes
no other representation or warranty of any kind to the Assignee. Neither the
Assignor nor any of its officers, directors, employees, agents or attorneys
shall be responsible for (i) the due execution, legality, validity,
enforceability, genuineness, sufficiency or collectibility of any Loan Document,
including without limitation, documents granting the Assignor and the other
Lenders a security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the
property, books or records of the Borrower, (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Credit Extensions or (vii) any mistake, error of
judgment, or action taken or omitted to be taken in connection with the Credit
Extensions or the Loan Documents.
7. REPRESENTATIONS AND UNDERTAKINGS OF THE ASSIGNEE. The Assignee (i)
confirms that it has received a copy of the Credit Agreement, together with
copies of the financial statements requested by the Assignee and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment Agreement, (ii) agrees that
it will, independently and without reliance upon the Agent, the Assignor or any
other Lender and based on such documents and information at it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, (iii) appoints and authorizes the
Agent to take such action as agent on its behalf and to exercise such powers
under the Loan Documents as are delegated to the Agent by the terms thereof,
together with such powers as are reasonably incidental thereto, (iv) confirms
that the execution and delivery of this Assignment Agreement by the Assignee is
duly authorized, (v) agrees that it will perform in accordance with their terms
all of the obligations which by the terms of the Loan Documents are required to
be performed by it as a Lender, (vi) agrees that its payment instructions and
notice instructions are as set forth in the attachment to Schedule 1, (vii)
confirms that none of the funds, monies, assets or other consideration being
used to make the purchase and assumption hereunder are "plan assets" as defined
under ERISA and that its rights, benefits and interests in and under the Loan
Documents will not be "plan assets" under ERISA, (viii) agrees to indemnify and
hold the Assignor harmless
Exhibits and Schedules - Page 13
against all losses, costs and expenses (including, without limitation,
reasonable attorneys' fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee's non-performance of
the obligations assumed under this Assignment Agreement, and (ix) if applicable,
attaches the forms prescribed by the Internal Revenue Service of the United
States certifying that the Assignee is entitled to receive payments under the
Loan Documents without deduction or withholding of any United States federal
income taxes.
8. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois and the
United States of America.
9. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall be
the address set forth in the attachment to Schedule 1.
10. COUNTERPARTS; DELIVERY BY FACSIMILE. This Assignment Agreement may
be executed in counterparts. Transmission by facsimile of an executed
counterpart of this Assignment Agreement shall be deemed to constitute due and
sufficient delivery of such counterpart and such facsimile shall be deemed to be
an original counterpart of this Assignment Agreement.
IN WITNESS WHEREOF, the duly authorized officers of the parties hereto
have executed this Assignment Agreement by executing Schedule 1 hereto as of the
date first above written.
Exhibits and Schedules - Page 14
SCHEDULE 1
TO ASSIGNMENT AGREEMENT
1. Description and Date of Credit Agreement:
2. Date of Assignment Agreement: _______________, 20_____
3. Amounts (As of Date of Item 2 above):
<Table>
<Caption>
Facility Facility Facility Facility
1* 2* 3* 4*
----- ----- ----- -----
a. Assignee's percentage
of each Facility purchased
under the Assignment
Agreement** % % % %
----- ----- ----- -----
b. Amount of each Facility
purchased under the
Assignment Agreement*** $ $ $ $
----- ----- ----- -----
4. Assignee's Commitment (or Outstanding
Credit Exposure with respect to
terminated Commitments)
purchased hereunder: $
------------
5. Proposed Effective Date:
------------
6. Non-standard Recordation Fee
Arrangement N/A***
[ASSIGNOR/ASSIGNEE
TO PAY 100% OF FEE]
[FEE WAIVED BY AGENT]
</Table>
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
----------------------------- ---------------------------------
Name: Name:
----------------------------- ---------------------------------
Title: Title:
----------------------------- ---------------------------------
Exhibits and Schedules - Page 15
ACCEPTED AND CONSENTED ACCEPTED AND CONSENTED
TO BY TO**** BY
THE SHAW GROUP INC. BANK ONE, NA, AS AGENT
By: By:
-------------------------------- --------------------------------
Name: Name:
-------------------------------- --------------------------------
Title: Title:
-------------------------------- --------------------------------
* Insert specific facility names per Credit Agreement
** Percentage taken to 10 decimal places
*** If fee is split 50-50, pick N/A as option
**** Delete if not required by Credit Agreement
Exhibits and Schedules - Page 16
ATTACHMENT TO SCHEDULE 1 TO ASSIGNMENT AGREEMENT
ADMINISTRATIVE INFORMATION SHEET
Attach Assignor's Administrative Information Sheet, which must
include notice addresses for the Assignor and the Assignee
(Sample form shown below)
ASSIGNOR INFORMATION
CONTACT:
Name: Telephone No.:
--------------------------------- ------------------------
Fax No.: Telex No.:
------------------------------ ----------------------------
Answerback:
---------------------------
PAYMENT INFORMATION:
Name & ABA # of Destination Bank:
-----------------------------------------------
Account Name & Number for Wire Transfer:
----------------------------------------
Other Instructions:
-------------------------------------------------------------
ADDRESS FOR NOTICES FOR ASSIGNOR:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
ASSIGNEE INFORMATION
CREDIT CONTACT:
Name: Telephone No.:
-------------------------------- ------------------------
Fax No.: Telex No.:
----------------------------- ----------------------------
Answerback:
---------------------------
KEY OPERATIONS CONTACTS:
Booking Installation: Booking Installation:
---------------- -----------------
Name: Name:
-------------------------------- ---------------------------------
Telephone No.: Telephone No.:
----------------------- ------------------------
Fax No.: Fax No.:
----------------------------- ------------------------------
Telex No.: Telex No.:
--------------------------- ----------------------------
Answerback: Answerback:
-------------------------- ---------------------------
Exhibits and Schedules - Page 17
PAYMENT INFORMATION:
Name & ABA # of Destination Bank:
---------------------------------------------
---------------------------------------------
Account Name & Number for Wire Transfer:
----------------------------------------
----------------------------------------
Other Instructions:
-------------------------------------------------------------
- --------------------------------------------------------------------------------
Address for Notices for Assignee:
-----------------------------------------------
-----------------------------------------------
Exhibits and Schedules - Page 18
BANK ONE, NA INFORMATION
Assignee will be called promptly upon receipt of the signed agreement.
INITIAL FUNDING CONTACT: SUBSEQUENT OPERATIONS CONTACT:
Name: Name:
---------------------------------- ---------------------------------
Telephone No.: ( ) Telephone No.: ( )
------------------- ------------------
BONA Telex No.:
---------------------
INITIAL FUNDING STANDARDS:
Libor - Fund 2 days after rates are set.
BANK ONE, NA WIRE INSTRUCTIONS:
ADDRESS FOR NOTICES FOR BONA:
Exhibits and Schedules - Page 19
SCHEDULE 4.1(xxv)
COVENANT COMPLIANCE CALCULATION
(SEE SECTION 4.1(xx))
Exhibits and Schedules - Page 20
SCHEDULE 5.7
LITIGATION AND CONTINGENT OBLIGATIONS
(SEE SECTION 5.7)
Exhibits and Schedules - Page 21
SCHEDULE 5.12 - MATERIAL AGREEMENTS
1. Indebtedness that is described on the following table:
<Table>
<Caption>
PROPERTY ENCUMBERED AMOUNT OF
INDEBTEDNESS INCURRED BY INDEBTEDNESS OWED TO (IF ANY) MATURITY INDEBTEDNESS AS OF
------------------------ -------------------- ------------------- -------- ------------ ---------
Alloy Piping Products, Inc Bank Boston Equipment 07/1/03 $3,522,000 05/31/00
Alloy Piping Products, Inc Former Owners of APP Non-Competition Agreement 04/1/04 $861,000 05/31/00
B.F. Shaw, Inc. State of South Carolina Letter of Credit 2005 $4,000,000 05/31/00
Naptech, Inc. Bank Boston Leasing Equipment 07/01/04 $2,285,000 05/31/00
Shaw Constructors Bank Boston Leasing Equipment 04/01/05 $864,000 05/31/00
Shaw Group U.K. Holding, LTD NatWest Bank Assets of Shaw Group U.K. (pounds)2,458,000 05/31/00
(GBP 2.5 million) and a L.10 million parent
company guarantee
Sunland Fab/The Shaw GE Capital Bus. Asset Equipment 03/31/04 $1,164,000 05/31/00
Group Inc Funding Corp
Sunland Fab/The Shaw GE Capital Bus. Asset Equipment 08/27/03 $280,000 05/31/00
Group Inc Funding Corp
Sunland Fabricators GE Capital Bus. Asset Real Estate 08/27/03 $1,262,000 05/31/00
Funding Corp
The Shaw Group Inc. First Insurance Funding Unsecured $183,000 05/31/00
Corp
The Shaw Group Inc. Southern Farm Bureau Corporate Office Building 06/01/19 $4,307,000 05/31/00
The Shaw Group Inc. Former Owners of Cojafex Cojafex Stock 12/31/03 $2,566,000 05/31/00
The Shaw Group Inc. Senior Note Holders - Various Assets 05/21/05 $14,286,000 05/31/00
Series A (Paid at Closing)
</Table>
Exhibits and Schedules - Page 22
<Table>
<Caption>
PROPERTY ENCUMBERED AMOUNT OF
INDEBTEDNESS INCURRED BY INDEBTEDNESS OWED TO (IF ANY) MATURITY INDEBTEDNESS AS OF
------------------------ -------------------- ------------------- -------- ------------ ---------
The Shaw Group Inc. Senior Note Holders - Various Assets 05/21/08 $40,000,000 05/31/00
Series B (Paid at Closing)
Word Industries Fabricators GE Capital Bus. Asset Real Estate 05/22/01 $999,000 05/31/00
Funding Corp
Word Industries Fabricators GE Capital Bus. Asset Equipment 11/27/03 $1,232,000 05/31/00
Funding Corp
Word Industries Fabricators GE Capital Bus. Asset Bender 09/01/06 $1,191,000 05/31/00
Funding Corp
Various Immaterial Various Equipment $87,000 05/31/00
Indebtedness
Various Immaterial Capital $1,023,000 05/31/00
Lease Obligations
</Table>
Exhibits and Schedules - Page 23
2. Assumed Liabilities (as such term is defined in the asset purchase
agreement entered into by and between the Borrower and Stone & Webster
in connection with the Stone & Webster Acquisition).
3. The entirety of Schedule 5.23 is hereby incorporated by reference into
this Schedule 5.12.
4. The Borrower has guaranteed 50% of the obligations of Shaw-Nass Middle
East, W.W.L. ("Shaw-Nass") under its general capital line of credit
with the Bank of Bahrain and Kuwait that provides for a borrowing base
of Bahraini Dinares 1,500,000.
5. The Borrower will guarantee 50% of the obligations of Shaw-Nass under a
credit facility of Bahraini Dinares 2,000,000 made available by the
Bank of Bahrain and Kuwait to be used to support the short-term capital
requirements of Shaw-Nass for a power plant project it was recently
awarded.
6. The Borrower will guarantee 50% of the obligations of Shaw-Nass for the
financing of a recently purchased Cojafex PB16 Induction Bending
Machine. The Cost of the machine plus installation will be Bahraini
Dinares 500,000.
7. The Borrower has guaranteed the obligations of Aiton Australia Pty,
Limited under its AUD $1,500,000 facility made available by Westpac
Banking Corp.
8. Deed of Indemnity dated November 14, 1997 by the Borrower in favor of
Midland Bank, PLC with respect to demands or claims on certain letters
of credit, bonds or guarantees.
9. Existing guarantees by the Borrower or any Subsidiary made in the
ordinary course of business of any payment to a vendor of goods or
services to the Borrower/Subsidiaries or guarantees by the Borrower or
any Subsidiary made with respect to the performance by the
Borrower/Subsidiary of a contract for the sale of goods or the delivery
of services.
10. Customary indemnification obligations undertaken by the Borrower and/or
its Subsidiaries in connection with acquisitions prior to the date of
the Agreement.
11. A guaranty assumed in the Stone & Webster transaction to First
Universal Federal Credit Union of a loan for approximately $100,000.
12. Certain obligations to be assumed in connection with the Stone &
Webster Acquisition related to letters of credit performance guarantees
and bonds and all other similar types of instruments issued by Midland
Bank plc.
13. Guaranty assumed in the Stone & Webster Acquisition owing to Al
Hollandi Bank. The Borrower has been informed that there are no amounts
outstanding under these credit facilities and that the credit
facilities are currently defunct.
14. FEDERAL INSURANCE COMPANY (Chubb & Son, Inc.). General Agreement of
Indemnity (guaranty by Stone & Webster, Incorporated, of Stone &
Webster Engineering Corporation's general bonding agreement dated as of
September 1, 1985).
Exhibits and Schedules - Page 24
15. Guaranties and indebtedness associated with a US$35,000,000 credit
facility with Saudi American Bank related to the Ras Tanura Project;
provided, however, that the Borrower contests that it did not assume
the obligations associated with this credit facility under the
Acquisition Agreement. The Borrower has been informed that the
outstanding amounts on this credit facility are approximately
US$14,100,000, of which Stone & Webster is only responsible for
approximately US$7,050,000.
16. Letter of Guaranty dated as of September 1, 1992 from Stone & Webster
Engineering Corporation to SAUDI AMERICAN BANK, Al Khobar, Saudi
Arabia, regarding Bugshan S&W Company Ltd., to secure credit
facilities. This guaranty is limited to $5,000,000. The Borrower has
been informed that, to the best of Stone & Webster, Incorporated's
knowledge, there are no amounts outstanding under these credit
facilities and that the credit facilities are currently defunct.
17. Letter of Guaranty dated as of October 19, 1992 whereby Stone & Webster
Engineering Corporation guaranteed to SAUDI AMERICAN BANK of Al Khobar,
Saudi Arabia, the repayment of S.R. 40,000,000. The Borrower has been
informed that, to the best of Stone & Webster, Incorporated's
knowledge, there are no amounts outstanding under these credit
facilities and that the credit facilities are currently defunct
18. Comfort letter dated as of April 21, 1993 executed by Stone & Webster
Overseas Group, Inc. to FORWARD MOTOR FINANCE LTD. in connection with
leasing motor vehicles to Stone & Webster Engineering Limited.
19. Guaranty dated as of September 15, 1993 executed by Stone & Webster,
Incorporated in favor of ABU DHABI COMMERCIAL BANK to support credit
facilities up to AED 1,000,000 granted to Stone & Webster Abu Dhabi
(United Arab Emirates), Inc. The Borrower has been informed that there
are no amounts outstanding under these credit facilities and that the
credit facilities are currently defunct.
20. Guaranty Agreement dated as of January 31, 1994 executed by Stone &
Webster, Incorporated in favor of PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY for payment of promissory notes in the principal amounts of
$21,000,000 and $8,000,000 relating to the Mortgage on the Houston
Office Building. Guaranty covers extensions and renewals of the
underlying promissory notes.
21. Guarantee letter dated as of April 22, 1994 executed by Stone & Webster
Engineering Corporation to THE BANK OF NOVA SCOTIA in connection with
the indebtedness and liability of Stone & Webster Canada Ltd.
Subordination and Postponement Agreement dated as of May 2, 1994
executed by Stone & Webster, Incorporated to THE BANK OF NOVA SCOTIA in
connection with the indebtedness and liability of Stone & Webster
Canada Ltd. Guaranty Agreements, and subsequent modifications,
revisions, replacements or substitutions, executed by Stone & Webster,
Incorporated, and/or Stone & Webster Engineering Corporation in favor
of THE BANK OF NOVA SCOTIA, supporting a revolving term credit facility
in the original amount of $7,500,000 Cdn. established in July, 1995 for
Stone & Webster Canada Limited, as amended. As of August 18, 2000, all
outstanding indebtedness under this facility was paid in full.
Exhibits and Schedules - Page 25
22. Payment Guaranty dated as of March 6, 1997 addressed to ARAB BANK PLC
in connection with the obligations of Stone & Webster Engineering
Limited. This guaranty is connected with, and should be superseded by
the Guaranty dated as of December 17, 1997; provided, however, that the
Borrower contests that it has not assumed this Payment Guaranty under
the Acquisition Agreement.
Exhibits and Schedules - Page 26
SCHEDULE 6.11(ii)
INDEBTEDNESS, LIENS AND MATERIAL AGREEMENTS
(SEE SECTIONS 5.12, 5.14, 6.11 AND 6.15)
<Table>
<Caption>
Maturity
Indebtedness Indebtedness Property and Amount
Incurred By Owed To Encumbered (If Any) of Indebtedness
- ----------- ------- ------------------- ---------------
</Table>
Material Agreements:
Exhibits and Schedules - Page 27
SCHEDULE 6.14(ii)
SUBSIDIARIES AND OTHER INVESTMENTS
(SEE SECTIONS 5.8 AND 6.14)
<Table>
<Caption>
Investment Jurisdiction of Owned Amount of Percent
In Organization By Investment Ownership
---------- -------------- ----- ---------- ---------
ACL Piping, Inc.
Aiton Australia Pty Ltd.
Alloy Piping Products, Inc.
Associated Valve, Inc.
B.F. Shaw, Inc.
C.B.P. Engineering Corp.
Cojafex, B.V.
Connex Pipe Systems, Inc.
Fronek-ren, S.R.O.
Fronek A/DE, Inc.
Fronek Engineering and Consulting, Inc.
Fronek Power Services, Inc.
FVF, Incorporated
Inflo Control Systems, Ltd.
IRM/NAPTech Joint Venture, L.L.C.
Lone Star Fabricators, Inc.
NAPTech, Inc.
NAPTech Pressure Systems Corporation
National Fabricators, Inc.
Manufacturas Shaw South America
Pipe Shields, Inc.
Pipework Engineering and Developments, Ltd.
Shaw Group International, Inc.
</Table>
Exhibits and Schedules - Page 28
Shaw Group U.K. Holdings, Ltd.
Shaw Group U.K. (Projects), Ltd.
Shaw Heat Treating Service, C.A.
Shaw Holdings South America, C.A.
Shaw Industrial Supply, Inc.
Shaw International, Inc.
Shaw Lancas, C.A.
Shaw Maintenance, Inc.
Shaw Managed Services, Inc.
Shaw Manufacturing and Services, Inc.
Shaw Nass Middle East, W.L.L.
Shaw Overseas (Middle East), Ltd.
Shaw Overseas (Far East), Ltd.
Shaw Power Services, Inc.
Shaw Process and Industrial Group, Inc.
Shaw Trading FSC, Ltd.
Sunland Fabricators, Inc.
UCI Holding, Inc.
Welding Technology & Supply, Inc.
Word Industries Fabricators, Inc.
World Industrial Constructors, Inc.
Worldwide Industrial Constructors, Inc.
Exhibits and Schedules - Page 29
SCHEDULE 6.19(v)
CONTINGENT OBLIGATIONS
1. Assumed Liabilities (as such term is defined in the asset purchase
agreement entered into by and between the Borrower and Stone & Webster
in connection with the Stone & Webster Acquisition) to the extent that
such Assumed Liabilities constitute guaranties or Contingent
Obligations.
2. The entirety of Schedule 5.23 is hereby incorporated by reference into
this Schedule 6.19(v).
3. The Borrower has guaranteed 50% of the obligations of Shaw-Nass Middle
East, W.W.L. ("Shaw-Nass") under its general capital line of credit
with the Bank of Bahrain and Kuwait that provides for a borrowing base
of Bahraini Dinares 1,500,000.
4. The Borrower will guarantee 50% of the obligations of Shaw-Nass under a
credit facility of Bahraini Dinares 2,000,000 made available by the
Bank of Bahrain and Kuwait to be used to support the short-term capital
requirements of Shaw-Nass for a power plant project it was recently
awarded.
5. The Borrower will guarantee 50% of the obligations of Shaw-Nass for the
financing of a recently purchased Cojafex PB16 Induction Bending
Machine. The Cost of the machine plus installation will be Bahraini
Dinares 500,000.
6. The Borrower has guaranteed the obligations of Aiton Australia Pty,
Limited under its AUD $1,500,000 facility made available by Westpac
Banking Corp.
7. Deed of Indemnity dated November 14, 1997 by the Borrower in favor of
Midland Bank, PLC with respect to demands or claims on certain letters
of credit, bonds or guarantees.
8. Existing guarantees by the Borrower or any Subsidiary made in the
ordinary course of business of any payment to a vendor of goods or
services to the Borrower/Subsidiaries or guarantees by the Borrower or
any Subsidiary made with respect to the performance by the
Borrower/Subsidiary of a contract for the sale of goods or the delivery
of services.
9. Customary indemnification obligations undertaken by the Borrower and/or
its Subsidiaries in connection with acquisitions prior to the date of
the Agreement.
10. A guaranty assumed in the Stone & Webster transaction to First
Universal Federal Credit Union of a loan for approximately $100,000.
11. Certain obligations to be assumed in connection with the Stone &
Webster Acquisition related to letters of credit performance guarantees
and bonds and all other similar types of instruments issued by Midland
Bank plc.
Exhibits and Schedules - Page 30
12. Guaranty assumed in the Stone & Webster Acquisition owing to Al
Hollandi Bank. The Borrower has been informed that there are no amounts
outstanding under these credit facilities and that the credit
facilities are currently defunct.
13. FEDERAL INSURANCE COMPANY (Chubb & Son, Inc.). General Agreement of
Indemnity (guaranty by Stone & Webster, Incorporated, of Stone &
Webster Engineering Corporation's general bonding agreement dated as of
September 1, 1985).
14. Guaranties and indebtedness associated with a US$35,000,000 credit
facility with Saudi American Bank related to the Ras Tanura Project;
provided, however, that the Borrower contests that it did not assume
the obligations associated with this credit facility under the
Acquisition Agreement. The Borrower has been informed that the
outstanding amounts on this credit facility are approximately
US$14,100,000, of which Stone & Webster is only responsible for
approximately US$7,050,000.
15. Letter of Guaranty dated as of September 1, 1992 from Stone & Webster
Engineering Corporation to SAUDI AMERICAN BANK, Al Khobar, Saudi
Arabia, regarding Bugshan S&W Company Ltd., to secure credit
facilities. This guaranty is limited to $5,000,000. The Borrower has
been informed that, to the best of Stone & Webster, Incorporated's
knowledge, there are no amounts outstanding under these credit
facilities and that the credit facilities are currently defunct.
16. Letter of Guaranty dated as of October 19, 1992 whereby Stone & Webster
Engineering Corporation guaranteed to SAUDI AMERICAN BANK of Al Khobar,
Saudi Arabia, the repayment of S.R. 40,000,000. The Borrower has been
informed that, to the best of Stone & Webster, Incorporated's
knowledge, there are no amounts outstanding under these credit
facilities and that the credit facilities are currently defunct
17. Comfort letter dated as of April 21, 1993 executed by Stone & Webster
Overseas Group, Inc. to FORWARD MOTOR FINANCE LTD. in connection with
leasing motor vehicles to Stone & Webster Engineering Limited.
18. Guaranty dated as of September 15, 1993 executed by Stone & Webster,
Incorporated in favor of ABU DHABI COMMERCIAL BANK to support credit
facilities up to AED 1,000,000 granted to Stone & Webster Abu Dhabi
(United Arab Emirates), Inc. The Borrower has been informed that there
are no amounts outstanding under these credit facilities and that the
credit facilities are currently defunct.
19. Guaranty Agreement dated as of January 31, 1994 executed by Stone &
Webster, Incorporated in favor of PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY for payment of promissory notes in the principal amounts of
$21,000,000 and $8,000,000 relating to the Mortgage on the Houston
Office Building. Guaranty covers extensions and renewals of the
underlying promissory notes.
20. Guarantee letter dated as of April 22, 1994 executed by Stone & Webster
Engineering Corporation to THE BANK OF NOVA SCOTIA in connection with
the indebtedness and liability of Stone & Webster Canada Ltd.
Subordination and Postponement Agreement dated as of May 2, 1994
executed by Stone & Webster, Incorporated to THE BANK OF
Exhibits and Schedules - Page 31
NOVA SCOTIA in connection with the indebtedness and liability of Stone
& Webster Canada Ltd. Guaranty Agreements, and subsequent
modifications, revisions, replacements or substitutions, executed by
Stone & Webster, Incorporated, and/or Stone & Webster Engineering
Corporation in favor of THE BANK OF NOVA SCOTIA, supporting a revolving
term credit facility in the original amount of $7,500,000 Cdn.
established in July, 1995 for Stone & Webster Canada Limited, as
amended. As of August 18, 2000, all outstanding indebtedness under this
facility was paid in full.
21. Payment Guaranty dated as of March 6, 1997 addressed to ARAB BANK PLC
in connection with the obligations of Stone & Webster Engineering
Limited. This guaranty is connected with, and should be superseded by
the Guaranty dated as of December 17, 1997; provided, however, that the
Borrower contests that it has not assumed this Payment Guaranty under
the Acquisition Agreement.
22. The Borrower has guaranteed the obligations of Shaw Group UK under its
credit facility with a L.10 million parent guarantee.
Exhibits and Schedules - Page 32