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EXHIBIT 99.1
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AMENDED AND RESTATED
CREDIT AGREEMENT
by and among
ATRIUM CORPORATION,
ATRIUM COMPANIES, INC.,
THE BANKS PARTIES HERETO
and
BANKERS TRUST COMPANY,
as AGENT
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Dated as of March 27, 1998
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TABLE OF CONTENTS
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SECTION 1. AMOUNT AND TERMS OF CREDIT......................................................................2
1.01 The Commitments.................................................................................2
1.02 Minimum Amount of Each Borrowing................................................................3
1.03 Notice of Borrowing.............................................................................3
1.04 Disbursement of Funds...........................................................................4
1.05 Notes...........................................................................................4
1.06 Conversions.....................................................................................5
1.07 Pro Rata Borrowings.............................................................................6
1.08 Interest........................................................................................6
1.09 Interest Periods................................................................................7
1.10 Increased Costs; Illegality; etc................................................................8
1.11 Compensation...................................................................................10
1.12 Change of Lending Office.......................................................................10
1.13 Replacement of Banks...........................................................................10
SECTION 2. LETTERS OF CREDIT..............................................................................12
2.01 Letters of Credit..............................................................................12
2.02 Letter of Credit Requests......................................................................13
2.03 Letter of Credit Participations................................................................14
2.04 Agreement to Repay Letter of Credit Drawings...................................................16
2.05 Increased Costs................................................................................16
SECTION 3. COMMITMENT COMMISSION; FEES; REDUCTIONS OF COMMITMENT..........................................17
3.01 Fees...........................................................................................17
3.02 Voluntary Termination of Unutilized Commitments................................................18
3.03 Mandatory Reduction of Commitments.............................................................19
SECTION 4. PREPAYMENTS; PAYMENTS; TAXES...................................................................20
4.01 Voluntary Prepayments..........................................................................20
4.02 Mandatory Repayments...........................................................................21
4.03 Method and Place of Payment....................................................................26
4.04 Net Payments...................................................................................27
SECTION 5. CONDITIONS PRECEDENT TO EFFECTIVENESS OF AGREEMENT AND FUNDING OF TERM
LOAN....................................................................................................28
5.01 Execution of Agreement; Term Notes.............................................................29
5.02 Existing Security Documents....................................................................29
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5.03 Fees; etc......................................................................................29
5.04 Opinions of Counsel............................................................................29
5.05 Corporate Documents; Proceedings; etc..........................................................29
5.06 Shareholders' Agreements; Management Agreements; Collective Bargaining
Agreements; Existing Debt Agreements; Tax Sharing Agreements...................................30
5.07 Capital Contributions; Stock Repurchase; etc...................................................30
5.08 Refinancing of Existing Credit Agreement.......................................................31
5.09 Acquisition....................................................................................32
5.10 Prepayment of Indebtedness and Release of Liens................................................32
5.11 Environmental Indemnity Agreement..............................................................33
5.12 Pledge Agreement...............................................................................33
5.13 Security Agreement.............................................................................33
5.14 Subsidiary Guaranty............................................................................34
5.15 Mortgages; Title Insurance; Surveys; Etc.......................................................34
5.16 Consent Letter.................................................................................35
5.17 Adverse Change; Etc............................................................................35
5.18 Litigation.....................................................................................35
5.19 Solvency Certificate; Environmental Analyses; Insurance........................................35
5.20 Pro Forma Balance Sheet........................................................................36
5.21 Officer's Certificate..........................................................................36
SECTION 6. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS......................................................36
6.01 No Default; Representations and Warranties.....................................................37
6.02 Notice of Borrowing; Letter of Credit Request..................................................37
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS.....................................................37
7.01 Corporate Status...............................................................................37
7.02 Corporate Power and Authority..................................................................38
7.03 No Violation...................................................................................38
7.04 Governmental Approvals.........................................................................38
7.05 Financial Statements; Financial Condition; Undisclosed Liabilities; Projections;
Etc............................................................................................38
7.06 Litigation.....................................................................................39
7.07 True and Complete Disclosure...................................................................40
7.08 Use of Proceeds; Margin Regulations............................................................40
7.09 Tax Returns and Payments.......................................................................40
7.10 Compliance with ERISA..........................................................................41
7.11 Security Documents.............................................................................42
7.12 Representations and Warranties in Documents....................................................42
7.13 Properties.....................................................................................43
7.14 Capitalization.................................................................................43
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7.15 Subsidiaries...................................................................................43
7.16 Compliance with Statutes; Etc..................................................................44
7.17 Investment Company Act.........................................................................44
7.18 Public Utility Holding Company Act.............................................................44
7.19 Labor Relations................................................................................44
7.20 Patents, Licenses, Franchises and Formulas.....................................................44
7.21 Indebtedness...................................................................................45
7.22 Recapitalization...............................................................................45
7.23 Acquisition....................................................................................45
7.24 Special Purpose Corporation....................................................................45
7.25 Subordination..................................................................................46
SECTION 8. AFFIRMATIVE COVENANTS..........................................................................46
8.01 Information Covenants..........................................................................46
8.02 Books, Records and Inspections.................................................................47
8.03 Maintenance of Property; Insurance.............................................................48
8.04 Corporate Franchises...........................................................................49
8.05 Compliance with Statutes; Etc..................................................................49
8.06 ERISA..........................................................................................49
8.07 End of Fiscal Years; Fiscal Quarters...........................................................50
8.08 Performance of Obligations.....................................................................50
8.09 Payment of Taxes...............................................................................50
8.10 Additional Security; Further Assurances; Surveys...............................................50
8.11 Ownership of Subsidiaries......................................................................52
8.12 Maintenance of Corporate Separateness..........................................................52
8.13 Repayment of SBA Loan..........................................................................52
8.14 Dissolution of Masterview California...........................................................52
SECTION 9. NEGATIVE COVENANTS.............................................................................52
9.01 Liens..........................................................................................52
9.02 Consolidation; Merger; Purchase or Sale of Assets; etc.........................................55
9.03 Dividends......................................................................................57
9.04 Indebtedness...................................................................................58
9.05 Advances, Investments and Loans................................................................59
9.06 Transactions with Affiliates...................................................................61
9.07 Capital Expenditures...........................................................................61
9.08 Minimum Consolidated Interest Coverage Ratio...................................................62
9.09 Minimum Consolidated EBITDA....................................................................63
9.10 Limitation on Modifications of Indebtedness and Payments of Indebtedness;
Modifications of Certificate of Incorporation, By-Laws and Certain Other
Agreements; etc................................................................................64
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9.11 Limitation on Certain Restrictions on Subsidiaries.............................................65
9.12 Limitation on Issuance of Capital Stock........................................................65
9.13 Changes in Business............................................................................65
9.14 Limitation on Creation of Subsidiaries.........................................................66
SECTION 10. EVENTS OF DEFAULT..............................................................................66
10.01 Payments.......................................................................................66
10.02 Representations, Etc...........................................................................66
10.03 Covenants......................................................................................66
10.04 Default Under Other Agreements.................................................................66
10.05 Bankruptcy, Etc................................................................................67
10.06 ERISA..........................................................................................67
10.07 Security Documents.............................................................................68
10.08 Guaranty.......................................................................................68
10.09 Judgments......................................................................................68
10.10 Change of Control..............................................................................68
10.11 Environmental Matters..........................................................................68
SECTION 11. DEFINITIONS AND ACCOUNTING TERMS...............................................................69
11.01 Defined Terms..................................................................................69
SECTION 12. THE AGENT......................................................................................92
12.01 Appointment....................................................................................92
12.02 Nature of Duties...............................................................................92
12.03 Lack of Reliance on the Agent..................................................................93
12.04 Certain Rights of the Agent....................................................................93
12.05 Reliance.......................................................................................93
12.06 Indemnification................................................................................93
12.07 The Agent in its Individual Capacity...........................................................94
12.08 Holders........................................................................................94
12.09 Resignation by the Agent.......................................................................94
SECTION 13. MISCELLANEOUS..................................................................................95
13.01 Payment of Expenses, etc.......................................................................95
13.02 Right of Setoff; Collateral Matters............................................................96
13.03 Notices........................................................................................96
13.04 Benefit of Agreement...........................................................................96
13.05 No Waiver; Remedies Cumulative.................................................................98
13.06 Payments Pro Rata..............................................................................98
13.07 Calculations; Computations.....................................................................99
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13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL...........................................................................99
13.09 Counterparts..................................................................................100
13.10 Intentionally Omitted.........................................................................100
13.11 Headings Descriptive..........................................................................100
13.12 Amendment or Waiver; etc......................................................................100
13.13 Survival......................................................................................102
13.14 Domicile of Loans.............................................................................102
13.15 Limitation on Additional Amounts; etc.........................................................102
13.16 Confidentiality...............................................................................103
13.17 Registry......................................................................................103
SECTION 14. HOLDINGS GUARANTY.............................................................................104
14.01 The Holdings Guaranty.........................................................................104
14.02 Bankruptcy....................................................................................104
14.03 Nature of Liability...........................................................................104
14.04 Independent Obligation........................................................................105
14.05 Authorization.................................................................................105
14.06 Reliance......................................................................................106
14.07 Subordination.................................................................................106
14.08 Waiver........................................................................................106
14.09 Nature of Liability...........................................................................107
INDEX OF SCHEDULES AND EXHIBITS
SCHEDULE I Commitments
SCHEDULE II Bank Addresses
*SCHEDULE III Real Property
*SCHEDULE IV Subsidiaries
*SCHEDULE V Existing Indebtedness
*SCHEDULE VI Insurance
*SCHEDULE VII Existing Liens
*EXHIBIT A Form of Notice of Borrowing
*EXHIBIT B-1 Form of Term Note
*EXHIBIT B-2 Form of Revolving Note
*EXHIBIT C Form of Letter of Credit Request
*EXHIBIT D Form of Section 4.04(b)(iii) Certificate
*EXHIBIT E Form of Opinion of Vinson & Elkins,
Counsel to the Credit Parties
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*EXHIBIT F Form of Officers' Certificate
*EXHIBIT G Form of Environmental Indemnity
*EXHIBIT H Form of Pledge Agreement
*EXHIBIT I Form of Security Agreement
*EXHIBIT J Form of Subsidiary Guaranty
*EXHIBIT K Form of Consent Letter
*EXHIBIT L Form of Solvency Certificate
*EXHIBIT M Form of Intercompany Note
*EXHIBIT N Form of Assignment and Assumption Agreement
*EXHIBIT O Existing Letters of Credit
* The above schedules and exhibits have been omitted. The Company will
provide them to the Securities and Exchange Commission supplementally
upon request.
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AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of March
27, 1998, is by and among ATRIUM CORPORATION, a Delaware corporation
("Holdings"), ATRIUM COMPANIES, INC., a Delaware corporation (f/k/a FCI Holding
Corp. and survivor by merger of Fojtasek Companies, Inc.) (the "Borrower"), the
Banks party hereto from time to time and BANKERS TRUST COMPANY, as Agent (all
capitalized terms used herein and defined in Section 11 are used herein as
therein defined).
W I T N E S S E T H :
WHEREAS, the Borrower, the Agent and certain financial
institutions (the "Existing Banks") have entered into that certain Credit
Agreement dated as of November 27, 1996 (the "Existing Atrium Credit Agreement")
whereunder the Existing Banks agreed to provide a revolving credit facility
(including a letter of credit subfacility) to the Borrower in an aggregate
amount not to exceed $20,000,000 at any time outstanding;
WHEREAS, the proceeds of the revolving credit facility were
used by the Borrower for ongoing working capital and general corporate purposes,
including, without limitation, to pay fees, costs and expenses incurred in
connection with the transactions contemplated by the Existing Atrium Credit
Agreement;
WHEREAS, the Borrower has requested the Banks to make a Term
Loan to Borrower in the aggregate principal amount of $17,500,000, subject to
certain restrictions set forth herein, the proceeds of which Term Loan will be
used by the Borrower on the Restatement Date to finance the Acquisition and to
pay fees and expenses incurred in connection with the Acquisition pursuant to
the terms and conditions set forth herein;
WHEREAS, the Existing Banks are willing to continue to make
loans and to continue to extend commitments to make revolving credit loans, and
to make the Term Loan to the Borrower, in each case for the respective purposes
specified above and only on the terms and subject to the conditions set forth
herein;
WHEREAS, the Borrower and the Existing Banks now desire to
amend and restate the Existing Atrium Credit Agreement to, among other things,
set forth the terms and conditions under which the Banks will make the Term Loan
to the Borrower and to restate the Existing Atrium Credit Agreement to reflect
the amendments thereto; and
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WHEREAS, this Agreement shall become effective upon the date
(the "Restatement Date") on which (i) this Agreement has been duly executed by
Holdings, the Borrower, the Agent and the Existing Banks and (ii) the Borrower
has satisfied all of the conditions precedent more particularly set forth in
Section 5 (but in the event such conditions have not been satisfied or waived on
or before April 30, 1998, this Agreement shall be of no force and effect and the
Existing Atrium Credit Agreement shall continue in full force and effect);
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants herein contained, the parties hereto agree as follows:
SECTION 1. AMOUNT AND TERMS OF CREDIT.
1.01 The Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Bank with a Revolving Loan Commitment
severally agrees to continue to make, at any time and from time to time on and
after the Restatement Date and prior to the Revolving Loan Maturity Date, a
revolving loan or revolving loans (each, a "Revolving Loan" and, collectively,
the "Revolving Loans") to the Borrower, which Revolving Loans (i) shall, at the
option of the Borrower, be Base Rate Loans or Eurodollar Loans, provided that
(A) except as otherwise specifically provided in Section 1.10(b), all Revolving
Loans comprising the same Borrowing shall at all times be of the same Type, (B)
during the period from the Restatement Date to September 30, 1998 (the
"Syndication Period"), no Revolving Loans shall be maintained as Eurodollar
Loans with an Interest Period greater than one month, and (C) from the date on
which the Agent gives notice to the Borrower of a proposed syndication (which
notice may only be delivered during the Syndication Period) until the earlier of
(1) the 60th day after the giving of such notice and (2) the Syndication Date,
no Revolving Loans maintained as Eurodollar Loans may be incurred, (ii) may be
repaid and reborrowed in accordance with the provisions hereof, (iii) shall not
exceed for any Bank at any time outstanding that aggregate principal amount
which, when added to the product of (x) such Bank's Adjusted Percentage and (y)
the aggregate amount of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously with the
incurrence of, the respective incurrence of Revolving Loans) at such time,
equals the Revolving Loan Commitment of such Bank at such time and (iv) shall
not exceed for all Banks at any time outstanding that aggregate principal amount
which, when added to the amount of all Letter of Credit Outstandings (exclusive
of Unpaid Drawings which are repaid with the proceeds of, and simultaneously
with the incurrence of, the respective incurrence of Revolving Loans) at such
time then outstanding, equals the Total Revolving Loan Commitment at such time.
The Borrower and the Banks acknowledge the making of the Revolving Loans which
are outstanding on the Restatement Date in accordance with the terms of the
Existing Atrium Credit Agreement and agree that such Revolving Loans shall
continue to be outstanding pursuant to the terms and conditions of, and shall be
Revolving Loans under, this Agreement and the other Loan Documents.
(b) Subject to and upon the terms and conditions set forth
herein, each Bank with a Term Loan Commitment severally agrees to make, on the
Restatement Date, a term loan (each a "Term Loan" and, collectively, the "Term
Loans") to the Borrower, which Term Loans:
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(i) shall be made and initially maintained as a single
Borrowing of Base Rate Loans (subject to the option to convert such
Base Rate Loans pursuant to Section 1.06); and
(ii) shall be made by each Bank in that initial aggregate
principal amount as is equal to the Term Loan Commitment of such Bank
on the Restatement Date (before giving effect to any reductions thereto
on such date pursuant to Section 3.03(c)(i) but after giving effect to
any reductions thereto on or prior to such date pursuant to Section
3.03(c)(ii)).
Once repaid, Term Loans incurred hereunder may not be reborrowed.
1.02 Minimum Amount of Each Borrowing. The aggregate principal
amount of each Borrowing of Revolving Loans (i) that are Eurodollar Loans shall
not be less than $200,000 and, if greater, shall be in an integral multiple of
$50,000 and (ii) that are Base Rate Loans shall not be less than $200,000 and,
if greater, shall be in an integral multiple of $50,000. More than one Borrowing
may occur on the same date, but at no time shall there be outstanding more than
ten Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to
make a Borrowing hereunder, it shall give the Agent at its Notice Office on the
date that a Base Rate Loan is to be made prior written notice (or telephonic
notice promptly confirmed in writing) of each Base Rate Loan and at least three
Business Days' prior written (or telephonic notice promptly confirmed in
writing) notice of each Eurodollar Loan to be made hereunder, provided that any
such notice shall be deemed to have been given on a certain day only if given
before 12:00 Noon (New York time) on such day. Each such written notice or
written confirmation of telephonic notice (each a "Notice of Borrowing"), except
as otherwise expressly provided in Section 1.10, shall be irrevocable and shall
be given by the Borrower in the form of Exhibit A attached hereto, appropriately
completed to specify the aggregate principal amount of the Loans to be made
pursuant to such Borrowing, the date of such Borrowing (which shall be a
Business Day), whether the Loans being made pursuant to such Borrowing shall
constitute Term Loans or Revolving Loans and whether the Loans being made
pursuant to such Borrowing are to be initially maintained as Base Rate Loans or
Eurodollar Loans and, if Eurodollar Loans, the initial Interest Period to be
applicable thereto. The Agent shall promptly give each Bank which is required
to make Loans of the Tranche specified in the respective Notice of Borrowing,
notice of such proposed Borrowing, of such Bank's proportionate share thereof
and of the other matters required by the immediately preceding sentence to be
specified in the Notice of Borrowing.
(b) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice of any Borrowing of Loans, the Agent
may act without liability upon the basis of telephonic notice of such Borrowing,
believed by the Agent in good faith to be from an Authorized Officer prior to
receipt of written confirmation. In each such case, the Borrower hereby waives
the right to dispute the Agent's record of the terms of such telephonic notice
of such Borrowing of Loans.
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1.04 Disbursement of Funds. Except as otherwise specifically
provided in the immediately succeeding sentence, no later than 2:00 P.M. (New
York time) on the date specified in each Notice of Borrowing, each Bank with a
Commitment of the respective Tranche will make available its pro rata portion of
each such Borrowing requested to be made on such date. All such amounts shall be
made available in Dollars and in immediately available funds at the Payment
Office of the Agent, and the Agent will make available to the Borrower at the
Payment Office the aggregate of the amounts so made available by the Banks
(prior to 3:00 P.M. on such day, to the extent of funds actually received by the
Agent prior to 2:00 P.M. on such day). Unless the Agent shall have been notified
by any Bank prior to the date of Borrowing that such Bank does not intend to
make available to the Agent such Bank's portion of any Borrowing to be made on
such date, the Agent may assume that such Bank has made such amount available to
the Agent on such date of Borrowing and the Agent may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Agent by such Bank,
the Agent shall be entitled to recover such corresponding amount on demand from
such Bank. If such Bank does not pay such corresponding amount forthwith upon
the Agent's demand therefor, the Agent shall promptly notify the Borrower and
the Borrower shall immediately pay such corresponding amount to the Agent. The
Agent shall also be entitled to recover on demand from such Bank or the
Borrower, as the case may be, interest on such corresponding amount in respect
of each day from the date such corresponding amount was made available by the
Agent to the Borrower until the date such corresponding amount is recovered by
the Agent, at a rate per annum equal to (i) if recovered from such Bank, at the
overnight Federal Funds Rate and (ii) if recovered from the Borrower, the rate
of interest applicable to the respective Borrowing, as determined pursuant to
Section 1.08. Nothing in this Section 1.04 shall be deemed to relieve any Bank
from its obligation to make Loans hereunder or to prejudice any rights which the
Borrower may have against any Bank as a result of any failure by such Bank to
make Loans hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal
of, and interest on, the Loans made by each Bank shall be evidenced (i) if Term
Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-1 with blanks appropriately completed in
conformity herewith (each, a "Term Note" and, collectively, the "Term Notes"),
and (ii) if Revolving Loans, by a promissory note duly executed and delivered by
the Borrower substantially in the form of Exhibit B-2 attached hereto, with
blanks appropriately completed in conformity herewith (each, a "Revolving Note"
and, collectively, the "Revolving Notes").
(b) The Revolving Note issued to each Bank that has a
Revolving Loan Commitment or outstanding Revolving Loans shall (i) be executed
by the Borrower, (ii) be payable to the order of such Bank and its registered
assigns and be dated the Initial Borrowing Date, (iii) be in a stated principal
amount equal to the Revolving Loan Commitment of such Bank and be payable in the
principal amount of the Revolving Loans evidenced thereby, (iv) mature on the
Revolving Loan Maturity Date, (v) bear interest as provided in the appropriate
clause of Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans,
as the case may be, evidenced thereby, (vi) be subject to mandatory repayment as
provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement
and the other Credit Documents.
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(c) The Term Note issued to each Bank that has a Term Loan
Commitment or outstanding Term Loan shall (i) be executed by the Borrower, (ii)
be payable to the order of such Bank and its registered assigns and be dated the
Restatement Date, (iii) be in a stated principal amount equal to the Term Loan
made by such Bank on the Restatement Date and be payable in the principal amount
of Term Loans evidenced thereby, (iv) mature on the Term Loan Maturity Date, (v)
bear interest as provided in the appropriate clause of Section 1.08 in respect
of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced
thereby, (vi) be subject to mandatory repayment as provided in Section 4.02 and
(vii) be entitled to the benefits of this Agreement and the other Credit
Documents.
(d) Each Bank will note on its internal records the amount of
each Loan made by it and each payment in respect thereof and will prior to any
transfer of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in any such notation or endorsement shall not affect the Borrower's
obligations in respect of such Loans.
1.06 Conversions. The Borrower shall have the option to
convert, on any Business Day occurring on or after the Restatement Date, all or
a portion equal to at least (x) in the case of a conversion of Term Loans,
$500,000 (and, if greater, in an integral multiple of $100,000) and (y) in the
case of a conversion of Revolving Loans,$200,000 (and, if greater, in an
integral multiple of $50,000), of the outstanding principal amount of Loans made
pursuant to one or more Borrowings (so long as of the same Tranche) of one or
more Types of Loans into a Borrowing (of the same Tranche) of another Type of
Loan, provided that (A) except as otherwise provided in Section 1.10(b),
Eurodollar Loans may be converted into Base Rate Loans only on the last day of
an Interest Period applicable to the Loans being converted and no such partial
conversion of Eurodollar Loans shall reduce the outstanding principal amount of
such Eurodollar Loans made pursuant to a single Borrowing to less than (x) in
the case of Term Loans, $500,000 and (y) in the case of Revolving Loans,
$200,000, (B) Base Rate Loans may only be converted into Eurodollar Loans if no
Default or Event of Default is in existence on the date of the conversion, (C)
no conversion pursuant to this Section 1.06 shall result in a greater number of
Borrowings of Eurodollar Loans than is permitted under Section 1.02, (D) during
the Syndication Period, no Loans may be converted into Eurodollar Loans with an
Interest Period greater than one month, and (E) from the date on which the Agent
gives notice to the Borrower of a proposed syndication (which notice may only be
delivered during the Syndication Period) until the earlier of (1) the 60th day
after the giving of such notice and (2) the Syndication Date, no Loans may be
converted into or continued as Eurodollar Loans. Each such conversion shall be
effected by the Borrower by giving the Agent at its Notice Office prior to 1:00
P.M. (New York time) at least three Business Days' prior notice (each a "Notice
of Conversion") specifying the Loans to be so converted, the Borrowing or
Borrowings pursuant to which such Loans were made and, if to be converted into
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Agent shall give each Bank prompt notice of any such proposed conversion.
1.07 Pro Rata Borrowings. All Borrowings of Term Loans and
Revolving Loans under this Agreement shall be incurred from the Banks pro rata
on the basis of their Term Loan
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Commitments or Revolving Loan Commitments, as the case may be. It is understood
that no Bank shall be responsible for any default by any other Bank of its
obligation to make Loans hereunder and that each Bank shall be obligated to make
the Loans provided to be made by it hereunder, regardless of the failure of any
other Bank to make its Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date the
proceeds thereof are made available to the Borrower until the earlier of (i) the
maturity (whether by acceleration or otherwise) of such Base Rate Loan and (ii)
the conversion of such Base Rate Loan to a Eurodollar Loan pursuant to Section
1.06, at a rate per annum which shall be equal to the sum of the Applicable
Margin plus the Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date the proceeds
thereof are made available to the Borrower until the earlier of (i) the maturity
(whether by acceleration or otherwise) of such Eurodollar Loan and (ii) the
conversion of such Eurodollar Loan to a Base Rate Loan pursuant to Section 1.06
or 1.10, as applicable, at a rate per annum which shall, during each Interest
Period applicable thereto, be equal to the sum of the Applicable Margin plus the
Eurodollar Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount payable
hereunder shall, in each case, bear interest at a rate per annum equal to the
greater of (i) 2% per annum in excess of the rate otherwise applicable to Base
Rate Loans of the respective Tranche of Loans (or, with respect to any other
overdue amount, the rate otherwise applicable to Base Rate Loans that are
Revolving Loans) from time to time and (ii) the rate which is 2% in excess of
the rate then borne by such Loans, in each case with such interest to be payable
on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable
(i) in respect of each Base Rate Loan, quarterly in arrears on each Quarterly
Payment Date, (ii) in respect of each Eurodollar Loan, on the last day of each
Interest Period applicable thereto and, in the case of an Interest Period in
excess of three months, on each date occurring at three month intervals after
the first day of such Interest Period and (iii) in respect of each Revolving
Loan, on any repayment or prepayment (on the amount repaid or prepaid), at
maturity (whether by acceleration or otherwise) and, after such maturity, on
demand.
(e) Upon each Interest Determination Date, the Agent shall
determine the Eurodollar Rate for each Interest Period applicable to Eurodollar
Loans and shall promptly notify the Borrower and the Banks thereof. Each such
determination shall, absent manifest error, be final and conclusive and binding
on all parties hereto.
1.09 Interest Periods. At the time it gives any Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, any Eurodollar Loan (in the case of the initial Interest Period applicable
thereto) or on the third Business Day prior to the expiration of an
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Interest Period applicable to such Eurodollar Loan (in the case of any
subsequent Interest Period), the Borrower shall have the right to elect, by
giving the Agent notice thereof, the interest period (each an "Interest Period")
applicable to such Eurodollar Loan, which Interest Period shall, at the option
of the Borrower, be a one, two, three or six-month period, or, if available to
each Bank, a nine or twelve-month period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all
times have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including
the date of any conversion thereto from a Loan of a different Type) and
each Interest Period occurring thereafter in respect of such Eurodollar
Loan shall commence on the day on which the next preceding Interest
Period applicable thereto expires;
(iii) if any Interest Period relating to a Eurodollar Loan
begins on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period, such Interest
Period shall end on the last Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided, however, that if any Interest
Period for a Eurodollar Loan would otherwise expire on a day which is
not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on
the next preceding Business Day;
(v) no Interest Period may be selected at any time when an
Event of Default is then in existence;
(vi) no Interest Period in respect of any Borrowing of any
Tranche of Loans shall be selected which extends beyond the respective
Maturity Date for such Tranche of Loans; and
(vii) no Interest Period in respect of any Borrowing of Term
Loans shall be selected which extends beyond any date upon which a
mandatory repayment of Term Loans will be required to be made under
Section 4.02(b) if the aggregate principal amount of such Term Loans
which have Interest Periods which will expire after such date will be
in excess of the aggregate principal amount of Term Loans then
outstanding less the aggregate amount of such required prepayment.
If upon the expiration of any Interest Period
applicable to a Borrowing of Eurodollar Loans, the Borrower has failed
to elect, or is not permitted to elect, a new Interest Period to be
applicable to such Eurodollar Loans as provided above, the Borrower
shall be
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deemed to have elected to convert such Eurodollar Loans into Base Rate
Loans effective as of the expiration date of such current Interest
Period.
1.10 Increased Costs; Illegality; etc. (a) In the event that
any Bank shall have determined (which determination shall, with respect to
clause (i) below, may be made only by the Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the Closing Date, in the case of Revolving Loans,
and since the Restatement Date, in the case of Term Loans, affecting
the interbank Eurodollar market, adequate and fair means do not exist
for ascertaining the applicable interest rate on the basis provided for
in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loan because of (x) any change since the
Closing Date, in the case of Revolving Loans, and since the Restatement
Date, in the case of Term Loans, in any applicable law or governmental
rule, regulation, order, guideline or request (whether or not having
the force of law) or in the interpretation or administration thereof
and including the introduction of any new law or governmental rule,
regulation, order, guideline or request, including, but not limited to:
(A) a change in the basis of taxation of payment to any Bank of the
principal of or interest on such Eurodollar Loan or any other amounts
payable hereunder (except for changes in the rate of tax on, or
determined by reference to, the net income or profits of such Bank, or
any franchise tax based on the net income or profits of such Bank, in
either case pursuant to the laws of the United States of America, the
jurisdiction in which it is organized or in which its principal office
or applicable lending office is located or any subdivision thereof or
therein), but without duplication of any amounts payable in respect of
Taxes pursuant to Section 4.04(a), or (B) a change in official reserve
requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the
Eurodollar Rate, and/or (y) other circumstances since the Closing Date,
in the case of Revolving Loans, and since the Restatement Date, in the
case of Term Loans, affecting such Bank or the interbank Eurodollar
market or the position of such Bank in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has been made (x) unlawful by any law or governmental
rule, regulation or order, (y) impossible by compliance by any Bank in
good faith with any governmental request (whether or not having force
of law) or (z) impracticable as a result of a contingency occurring
after the Closing Date, in the case of Revolving Loans, and since the
Restatement Date, in the case of Term Loans, which materially and
adversely affects the interbank Eurodollar market;
then, and in any such event, such Bank (or the Agent, in the case of clause (i)
above) shall promptly give notice (by telephone confirmed in writing) to the
Borrower and, except in the case of clause (i) above, to the Agent of such
determination (which notice the Agent shall promptly transmit to each
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of the other Banks). Thereafter (x) in the case of clause (i) above, Eurodollar
Loans shall no longer be available until such time as the Agent notifies the
Borrower and the Banks that the circumstances giving rise to such notice by the
Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given
by the Borrower with respect to Eurodollar Loans which have not yet been
incurred (including by way of conversion), shall be deemed rescinded by the
Borrower, (y) in the case of clause (ii) above, the Borrower shall, subject to
the provisions of Section 13.15 (to the extent applicable), pay to such Bank,
within 30 days after written demand therefor, such additional amounts (in the
form of an increased rate of, or a different method of calculating, interest or
otherwise as such Bank in its sole discretion shall determine) as shall be
required to compensate such Bank for such increased costs or reductions in
amounts received or receivable hereunder (a written notice as to the additional
amounts owed to such Bank, showing the basis for the calculation thereof and
certifying that it is generally charging such costs to other similarly situated
borrowers under similar credit facilities, submitted to the Borrower by such
Bank in good faith shall, absent manifest error, be final and conclusive and
binding on all the parties hereto) and (z) in the case of clause (iii) above,
the Borrower shall take one of the actions specified in Section 1.10(b) as
promptly as possible and, in any event, within the time period required by law.
Each of the Agent and each Bank agrees that if it gives notice to the Borrower
of any of the events described in clause (i) or (iii) above, it shall promptly
notify the Borrower and, in the case of any such Bank, the Agent, if such event
ceases to exist. If any such event described in clause (iii) above ceases to
exist as to a Bank, the obligations of such Bank to make Eurodollar Loans and to
convert Base Rate Loans into Eurodollar Loans on the terms and conditions
contained herein shall be reinstated.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, cancel the respective
Borrowing by giving the Agent telephonic notice (confirmed in writing) on the
same date that the Borrower was notified by the affected Bank or the Agent
pursuant to Section 1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan
is then outstanding, upon at least three Business Days' written notice to the
Agent given immediately or, if permitted under applicable law, given at such
later date as permitted thereby, require the affected Bank to convert such
Eurodollar Loan into a Base Rate Loan, provided that, if more than one Bank is
affected at any time, then all affected Banks must be treated the same pursuant
to this Section 1.10(b).
(c) If at any time after the Closing Date, in the case of
Revolving Loans and Letters of Credit, and after the Restatement Date, in the
case of Term Loans, any Bank determines that the introduction of or any change
in any applicable law or governmental rule, regulation, order, guideline,
directive or request (whether or not having the force of law) concerning capital
adequacy, or any change in interpretation or administration thereof by any
governmental authority, central bank or comparable agency, will have the effect
of increasing the amount of capital required or expected to be maintained by
such Bank or any corporation controlling such Bank based on the existence of
such Bank's Commitments hereunder or its obligations hereunder, then the
Borrower shall, subject to the provisions of Section 13.15 (to the extent
applicable), pay to such Bank, upon its written
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demand therefor, such additional amounts as shall be required to compensate such
Bank or such other corporation for the increased cost to such Bank or such other
corporation or the reduction in the rate of return to such Bank or such other
corporation as a result of such increase of capital. In determining such
additional amounts, each Bank will act reasonably and in good faith and will use
averaging and attribution methods which are reasonable, provided that such
Bank's reasonable good faith determination of compensation owing under this
Section 1.10(c) shall, absent manifest error, be final and conclusive and
binding on all the parties hereto. Each Bank, upon determining that any
additional amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall show the basis
for calculation of such additional amounts and certifying that it is generally
charging such additional amounts to other similarly situated borrowers under
similar credit facilities.
1.11 Compensation. The Borrower shall, subject to the
provisions of Section 13.15 (to the extent applicable), compensate each Bank,
upon its written request (which request shall set forth the basis for requesting
such compensation), for all reasonable losses, expenses and liabilities
(including, without limitation, any loss, expense or liability incurred by
reason of the liquidation or reemployment of deposits or other funds required by
such Bank to fund its Eurodollar Loans but excluding any loss of anticipated
profit) which such Bank may sustain: (i) if for any reason (other than a default
by such Bank or the Agent) a Borrowing of, or conversion from or into,
Eurodollar Loans does not occur on a date specified therefor in a Notice of
Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or
deemed withdrawn pursuant to Section 1.10(a)); (ii) if any repayment (including
any repayment made pursuant to Section 4.02 or a result of an acceleration of
the Loans pursuant to Section 10) or conversion of any of its Eurodollar Loans
occurs on a date which is not the last day of an Interest Period with respect
thereto; (iii) if any prepayment of any of its Eurodollar Loans is not made on
any date specified in a notice of prepayment given by the Borrower; or (iv) as a
consequence of (A) any other default by the Borrower to repay its Loans when
required by the terms of this Agreement or any Note held by such Bank or (B) any
election made pursuant to Section 1.10(b).
1.12 Change of Lending Office. Each Bank agrees that on the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.05 or Section 4.04 with respect to such Bank,
it will, if requested by the Borrower, use reasonable efforts (subject to
overall policy considerations of such Bank) to designate another lending office
for any Loans or Letters of Credit affected by such event, provided that such
designation is made on such terms that such Bank and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of such Section. Nothing
in this Section 1.12 shall affect or postpone any of the obligations of the
Borrower or the right of any Bank provided in Sections 1.10, 2.05 and 4.04.
1.13 Replacement of Banks. (i) If any Bank becomes a
Defaulting Bank or otherwise defaults in its obligations to make Loans or fund
Unpaid Drawings, (ii) upon the occurrence of any event giving rise to the
operation of Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.05 or
Section 4.04 with respect to any Bank which results in such Bank charging to the
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Borrower increased costs in excess of those being generally charged by the other
Banks or (iii) as provided in Section 13.12(b) in the case of certain refusals
by a Bank to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower shall have the right, in accordance with the
requirements of Section 13.04(b), if no Default or Event of Default would exist
after giving effect to the respective replacement, to either replace such Bank
(the "Replaced Bank") with one or more other Eligible Transferee or Eligible
Transferees, none of whom shall constitute a Defaulting Bank at the time of such
replacement (collectively, the "Replacement Bank") and each of whom shall be
reasonably acceptable to the Agent or, at the option of the Borrower, to replace
only (a) the Revolving Loan Commitment (and outstandings pursuant thereto) of
the Replaced Bank with an identical Revolving Loan Commitment provided by the
Replacement Bank or (b) in the case of a replacement as provided in Section
13.12(b) where the consent of the respective Bank is required with respect to
less than all Tranches of its Loans or Commitments, the Commitments and/or
outstanding Term Loans of such Bank in respect of each Tranche where the consent
of such Bank would otherwise be individually required, with identical
Commitments and/or Loans of the respective Tranche provided by the Replacement
Bank; provided, however, that:
(A) at the time of any replacement pursuant to this Section
1.13, the Replaced Bank and the Replacement Bank shall enter into one
or more Assignment and Assumption Agreements pursuant to Section
13.04(b) (and with all fees payable pursuant to said Section 13.04(b)
to be paid by the Replacement Bank) pursuant to which the Replacement
Bank shall acquire all of the Commitments and outstanding Loans (or, in
the case of the replacement of only (a) the Revolving Loan Commitment,
the Revolving Loan Commitment and outstanding Revolving Loans and
participations in Letter of Credit Outstandings or (b) the outstanding
Term Loans, the outstanding Term Loans) of, and in each case (except
for the replacement of only the outstanding Term Loan of the respective
Bank) participations in Letters of Credit by, the Replaced Bank and, in
connection therewith, shall pay to (1) the Replaced Bank in respect
thereof an amount equal to the sum of (x) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans (or,
in the case of the replacement of only (I) the Revolving Loan
Commitment, the outstanding Revolving Loans or (II) the Term Loans, the
outstanding Term Loans) of the Replaced Bank, (y) in the case of any
replacement which includes the Revolving Loan Commitment of such
Replaced Bank, an amount equal to all Unpaid Drawings that have been
funded by (and not reimbursed to) such Replaced Bank, together with all
then unpaid interest with respect thereto at such time and (z) an
amount equal to all accrued, but theretofore unpaid, Fees owing to the
Replaced Bank (but only with respect to the relevant Tranche, in the
case of the replacement of less than all Tranches of Loans then held by
the respective Replaced Bank) pursuant to Section 3.01 and (2) pursuant
to Section 3.01 and (y) in the case of any replacement which includes
the Revolving Loan Commitment of a Replaced Bank, BTCo an amount equal
to such Replaced Bank's Adjusted Percentage (for this purpose,
determined as if the adjustment described in clause (y) of the
immediately succeeding sentence had been made with respect to such Re
placed Bank) of any Unpaid Drawing (which at such time remains an
Unpaid Drawing) to the extent such amount was not theretofore funded by
such Replaced Bank; and
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(B) all obligations of the Borrower owing to the Replaced Bank
(other than those (1) specifically described in clause (A) above in
respect of which the assignment purchase price has been, or is
concurrently being, paid or (2) relating to any Tranche of Loans and/or
Commitments of the respective Replaced Bank which will remain
outstanding after giving effect to the respective replacement) shall be
paid in full to such Replaced Bank concurrently with such replacement.
Upon the execution of the respective Assignment and Assumption Agreements, the
payment of amounts referred to in clauses (A) and (B) above and, if so requested
by the Replacement Bank, delivery to the Replacement Bank of the appropriate
Note or Notes executed by the Borrower, (x) the Replacement Bank shall become a
Bank hereunder and, unless the Replaced Bank continues to have outstanding Term
Loans or a Commitment hereunder, the Replaced Bank shall cease to constitute a
Bank hereunder, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 13.01
and 13.06), which shall survive (subject to Section 13.15) as to such Replaced
Bank and (y) in the case of a replacement of a Defaulting Bank with a
Non-Defaulting Bank, the Adjusted Percentages of the Banks shall be
automatically adjusted at such time to give effect to such replacement (and to
give effect to the replacement of a Defaulting Bank with one or more
Non-Defaulting Banks). Any replacement of a Bank pursuant to this Section 1.13
shall not be deemed to be a waiver of any rights which the Borrower, the Agent
or any other Bank shall have against the replaced Bank relating to events or
occurrences occurring prior to the effective date of such assignment.
SECTION 2. LETTERS OF CREDIT.
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request that any Issuing Bank
issue, at any time and from time to time on and after the Initial Borrowing Date
and prior to the Revolving Loan Maturity Date, (i) for the account of the
Borrower and for the benefit of any holder (or any trustee, agent or other
similar representative for any such holders) of L/C Supportable Obligations of
the Borrower or any of its Subsidiaries, an irrevocable sight standby letter of
credit denominated in Dollars, in a form customarily used by the Issuing Bank
or in such other form as has been approved by the Issuing Bank (each such
standby letter of credit, a "Standby Letter of Credit") in support of such L/C
Supportable Obligations and (ii) for the account of the Borrower and for the
benefit of sellers of goods to the Borrower or any of its Subsidiaries, an
irrevocable sight documentary letter of credit denominated in Dollars in a form
customarily used by such Issuing Bank or in such other form as has been approved
by such Issuing Bank (each such documentary letter of credit, a "Trade Letter of
Credit", and each such Trade Letter of Credit and each Standby Letter of Credit,
a "Letter of Credit") in support of commercial transactions of the Borrower and
its Subsidiaries. The Borrower, each Issuing Bank and the Banks acknowledge the
issuance of the Letters of Credit set forth on Exhibit O hereto which are
outstanding on the Restatement Date in accordance with the terms of the Existing
Atrium Credit Agreement and agree that such Letters of Credit shall continue to
be outstanding pursuant to the terms and conditions of, and shall be Letters of
Credit under, this Agreement and the other Credit Documents.
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(b) Each Issuing Bank may agree, in its sole discretion, and
BTCo hereby agrees that, in the event a requested Letter of Credit is not issued
by one of the other Issuing Banks, it will (subject to the terms and conditions
contained herein), at any time and from time to time on or after the Initial
Borrowing Date and prior to the Revolving Loan Maturity Date, following its
receipt of the respective Letter of Credit Request, issue for the account of the
Borrower one or more Letters of Credit (i) in the case of Standby Letters of
Credit, in support of such L/C Supportable Obligations of the Borrower or any of
its Subsidiaries as is permitted to remain outstanding without giving rise to a
Default or an Event of Default hereunder and (ii) in the case of Trade Letters
of Credit, in support of sellers of goods as referenced in Section 2.01(a),
provided that the respective Issuing Bank shall be under no obligation to issue
any Letter of Credit of the types described above if at the time of such
issuance:
(A) any order, judgment or decree of any governmental
authority or arbitrator shall purport by its terms to enjoin or
restrain such Issuing Bank from issuing such Letter of Credit or any
requirement of law applicable to such Issuing Bank or any request or
directive (whether or not having the force of law) from any
governmental authority with jurisdiction over such Issuing Bank shall
prohibit, or request that such Issuing Bank refrain from, the issuance
of letters of credit generally or such Letter of Credit in particular
or shall impose upon such Issuing Bank with respect to such Letter of
Credit any restriction or reserve or capital requirement (for which
such Issuing Bank is not otherwise compensated including, without
limitation by reimbursement from the Borrower) not in effect on the
date hereof, or any unreimbursed loss, cost or expense which was not
applicable, in effect or known to such Issuing Bank as of the date
hereof and which such Issuing Bank in good faith deems material to it;
or
(B) such Issuing Bank shall have received notice from any Bank
prior to the issuance of such Letter of Credit of the type described in
the penultimate sentence of Section 2.02(b).
(c) Notwithstanding the foregoing, (i) no Letter of Credit
shall be issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time would
exceed either (A) $5,000,000 or (B) when added to the aggregate principal amount
of all Revolving Loans made by Non-Defaulting Banks and then outstanding, an
amount equal to the Adjusted Total Revolving Loan Commitment at such time, and
(ii) each Letter of Credit shall by its terms terminate on or before the earlier
of (A) (1) in the case of Standby Letters of Credit, the date which occurs 12
months after the date of the issuance thereof (although any such Standby Letter
of Credit may be extendable for successive periods of up to 12 months each, but
not beyond one Business Day prior to the Revolving Loan Maturity Date, on terms
acceptable to the Issuing Bank thereof) and (2) in the case of Trade Letters of
Credit, the date which occurs 180 days after the date of issuance thereof, or
(B) the Revolving Loan Maturity Date.
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2.02 Letter of Credit Requests. (a) Whenever the Borrower
desires that a Letter of Credit be issued for its account, the Borrower shall
give the Agent and the respective Issuing Bank at least two Business Days' (or
such shorter period as is acceptable to the respective Issuing Bank) written
notice thereof. Each notice shall be in the form of Exhibit C attached hereto
(each a "Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be
deemed to be a representation and warranty by the Borrower that such Letter of
Credit may be issued in accordance with, and will not violate the requirements
of, Section 2.01(c). Unless the respective Issuing Bank has received notice from
any Bank before it issues a Letter of Credit that one or more of the conditions
specified in Section 5 or Section 6 are not then satisfied, or that the issuance
of such Letter of Credit would violate Section 2.01(c), then such Issuing Bank
shall issue the requested Letter of Credit for the account of the Borrower in
accordance with such Issuing Bank's usual and customary practices. Upon its
issuance of or amendment to any Letter of Credit, such Issuing Bank shall
promptly notify each Bank participating therein of such issuance or amendment
and such notice shall be accompanied by a copy of the issued Letter of Credit or
amendment, as the case may be.
2.03 Letter of Credit Participations. (a) Immediately upon the
issuance by any Issuing Bank of any Letter of Credit, such Issuing Bank shall be
deemed to have sold and transferred to each Bank with a Revolving Loan
Commitment, other than such Issuing Bank (each such Bank, in its capacity under
this Section 2.03, a "Participant"), and each such Participant shall be deemed
irrevocably and unconditionally to have purchased and received from such Issuing
Bank, without recourse or warranty, an undivided interest and participation, to
the extent of such Participant's Adjusted Percentage in such Letter of Credit,
each drawing made thereunder and the obligations of the Borrower under this
Agreement with respect thereto, and any security therefor or guaranty pertaining
thereto. Upon any change in the Revolving Loan Commitments or Adjusted
Percentages of the Banks pursuant to Section 1.13 or 13.04 or as a result of a
Bank Default, it is hereby agreed that, with respect to all outstanding Letters
of Credit and Unpaid Drawings, there shall be an automatic adjustment to the
participations pursuant to this Section 2.03 to reflect the new Adjusted
Percentages of the assignor and assignee Bank or of all Banks with Revolving
Loan Commitments, as the case may be.
(b) In determining whether to pay under any Letter of Credit,
such Issuing Bank shall have no obligation relative to the other Banks other
than to confirm that any documents required to be delivered under such Letter of
Credit appear to have been delivered and that they appear to comply on their
face with the requirements of such Letter of Credit. Any action taken or omitted
to be taken by such Issuing Bank under or in connection with any Letter of
Credit if taken or omitted in the absence of gross negligence or willful
misconduct as determined by a court of competent jurisdiction, shall not create
for such Issuing Bank any resulting liability to the Borrower or any Bank.
(c) In the event that any Issuing Bank makes any payment under
any Letter of Credit and the Borrower shall not have reimbursed such amount in
full to such Issuing Bank pursuant
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to Section 2.04(a), such Issuing Bank shall promptly notify the Agent, which
shall promptly notify each Participant of such failure, and each Participant
shall promptly and unconditionally pay to such Issuing Bank the amount of such
Participant's Adjusted Percentage of such unreimbursed payment in Dollars and in
same day funds. If the Agent so notifies, prior to 11:00 A.M. (New York time) on
any Business Day, any Participant required to fund a payment under a Letter of
Credit, such Participant shall make available to such Issuing Bank in Dollars
such Participant's Adjusted Percent age of the amount of such payment on such
Business Day in same day funds. If and to the extent such Participant shall not
have so made its Adjusted Percentage of the amount of such payment available to
such Issuing Bank, such Participant agrees to pay to such Issuing Bank,
forthwith on demand such amount, together with interest thereon, for each day
from such date until the date such amount is paid to such Issuing Bank at the
overnight Federal Funds Rate. The failure of any Participant to make available
to such Issuing Bank its Adjusted Percentage of any payment under any Letter of
Credit shall not relieve any other Participant of its obligation hereunder to
make available to such Issuing Bank its Adjusted Percentage of any Letter of
Credit on the date required, as specified above, but no Participant shall be
responsible for the failure of any other Participant to make available to such
Issuing Bank such other Participant's Adjusted Percentage of any such payment.
(d) Whenever any Issuing Bank receives a payment of a
reimbursement obligation as to which it has received any payments from the
Participants pursuant to clause (c) above, such Issuing Bank shall pay to each
Participant which has paid its Adjusted Percentage thereof, in Dollars and in
same day funds, an amount equal to such Participant's share (based upon the
proportionate aggregate amount originally funded by such Participant to the
aggregate amount funded by all Participants) of the principal amount of such
reimbursement obligation and interest thereon accruing after the purchase of the
respective participations.
(e) Upon the request of any Participant, each Issuing Bank
shall furnish to such Participant copies of any Letter of Credit issued by it
and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to
each Issuing Bank with respect to Letters of Credit issued by it shall be
irrevocable and not subject to any qualification or exception whatsoever and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any of its Subsidiaries may have at any
time against a beneficiary named in a Letter of Credit, any transferee
of any Letter of Credit (or any Person for whom any such transferee may
be acting), the Agent, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated
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transactions (including any underlying transaction between the Borrower
and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
2.04 Agreement to Repay Letter of Credit Drawings. (a) The
Borrower hereby agrees to reimburse the respective Issuing Bank, by making
payment to the Agent in immediately available funds at the Payment Office, for
any payment or disbursement made by such Issuing Bank under any Letter of Credit
issued by such Issuing Bank (each such amount, so paid until reimbursed, an
"Unpaid Drawing"), no later than three Business Days after the date of such
payment or disbursement, with interest on the amount so paid or disbursed by
such Issuing Bank, to the extent not reimbursed prior to 1:00 P.M. (New York
time) on the date of such payment or disbursement, from and including the date
paid or disbursed to but excluding the date such Issuing Bank was reimbursed by
the Borrower therefor at a rate per annum which shall be the Base Rate in effect
from time to time plus the Applicable Margin for Revolving Loans maintained as
Base Rate Loans; provided, however, that to the extent such amounts are not
reimbursed prior to 1:00 P.M. (New York time) on the fifth Business Day
following such payment or disbursement, interest shall thereafter accrue on the
amounts so paid or disbursed by such Issuing Bank (and until reimbursed by the
Borrower) at a rate per annum which shall be the Base Rate in effect from time
to time plus the Applicable Margin for Revolving Loans maintained as Base Rate
Loans plus 2%, in each such case, with interest to be payable on demand. The
respective Issuing Bank shall give the Borrower prompt notice of each Drawing
under any Letter of Credit, provided that the failure to give any such notice
shall in no way affect, impair or diminish the Borrower's obligations hereunder.
(b) The obligations of the Borrower under this Section 2.04 to
reimburse the respective Issuing Bank with respect to drawings on Letters of
Credit (each, a "Drawing") (including, in each case, interest thereon) 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 any Bank (including in its capacity as issuer of the Letter of
Credit or as Participant), or any nonapplication or misapplication by the
beneficiary of the proceeds of such Drawing, the respective Issuing Bank's only
obligation to the Borrower being to confirm that any documents required to be
delivered under such Letter of Credit appear to have been delivered and that
they appear to comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit if taken or omitted in the absence of gross
negligence or willful misconduct as determined by a court
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of competent jurisdiction, shall not create for such Issuing Bank any resulting
liability to the Borrower.
2.05 Increased Costs. If at any time after the Closing Date,
the introduction of or any change in any applicable law, rule, regulation,
order, guideline or request or in the interpretation or administration thereof
by any governmental authority charged with the interpretation or administration
thereof, or compliance by any Issuing Bank or any Participant with any request
or directive by any such authority (whether or not having the force of law), or
any change in generally acceptable accounting principles, shall either (i)
impose, modify or make applicable any reserve, deposit, capital adequacy or
similar requirement against Letters of Credit issued by any Issuing Bank or
participated in by any Participant, or (ii) impose on any Issuing Bank or any
Participant any other conditions relating, directly or indirectly, to this
Agreement or any Letter of Credit; and the result of any of the foregoing is to
increase the cost to any Issuing Bank or any Participant of issuing, maintaining
or participating in any Letter of Credit, or reduce the amount of any sum
received or receivable by any Issuing Bank or any Participant hereunder or
reduce the rate of return on its capital with respect to Letters of Credit
(except for changes in the rate of tax on, or determined by reference to, the
net income or profits of such Issuing Bank or such Participant, or any franchise
tax based on the net income or profits of such Bank or Participant, in either
case pursuant to the laws of the United States of America, the jurisdiction in
which it is organized or in which its principal office or applicable lending
office is located or any subdivision thereof or therein), but without
duplication of any amounts payable in respect of Taxes pursuant to Section
4.04(a), then, upon demand to the Borrower by such Issuing Bank or any
Participant (a copy of which demand shall be sent by such Issuing Bank or such
Participant to the Agent) and subject to the provisions of Section 13.15 (to the
extent applicable), the Borrower shall pay to such Issuing Bank or such
Participant such additional amount or amounts as will compensate such Bank for
such increased cost or reduction in the amount receivable or reduction on the
rate of return on its capital. Any Issuing Bank or any Participant, upon
determining that any additional amounts will be payable pursuant to this Section
2.05, will give prompt written notice thereof to the Borrower, which notice
shall include a certificate submitted to the Borrower by such Issuing Bank or
such Participant (a copy of which certificate shall be sent by such Issuing Bank
or such Participant to the Agent), setting forth in reasonable detail the basis
for the calculation of such additional amount or amounts necessary to compensate
such Issuing Bank or such Participant. The certificate required to be delivered
pursuant to this Section 2.05 shall, if delivered in good faith and absent
manifest error, be final and conclusive and binding on the Borrower.
SECTION 3. COMMITMENT COMMISSION; FEES; REDUCTIONS
OF COMMITMENT.
3.01 Fees. (a) The Borrower agrees to pay to the Agent for
distribution to each Non-Defaulting Bank a commitment commission (the
"Commitment Commission") for the period from and including the Effective Date to
but not including the date the Revolving Loan Commitments have been terminated,
computed at the rate of 1/2 of 1% per annum on the daily average Aggregate
Unutilized Commitments of such Bank. Accrued Commitment Commissions
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25
shall be due and payable quarterly in arrears on each Quarterly Payment Date and
the date upon which the Revolving Loan Commitments are terminated.
(b) The Borrower agrees to pay to the Agent for distribution
to each Non-Defaulting Bank with a Revolving Loan Commitment (based on their
respective Adjusted Percentages) a fee in respect of each Letter of Credit
issued hereunder (the "Letter of Credit Fee"), for the period from and including
the date of issuance of such Letter of Credit to and including the date of
termination of such Letter of Credit, computed at a rate per annum equal to the
difference between (i) the Applicable Margin for Revolving Loans which are
maintained as Eurodollar Loans as in effect from time to time and (ii) 1/4 of 1%
on the daily Stated Amount of such Letter of Credit. Accrued Letter of Credit
Fees shall be due and payable quarterly in arrears on each Quarterly Payment
Date and upon the first day on or after the termination of the Total Revolving
Loan Commitment upon which no Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to the respective Issuing Bank,
for its own account, a facing fee in respect of each Letter of Credit issued for
its account hereunder (the "Facing Fee") for the period from and including the
date of issuance of such Letter of Credit to and including the termination of
such Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the
daily Stated Amount of such Letter of Credit; provided, however, that in no
event shall the annual Facing Fee with respect to each Letter of Credit be less
than $500, it being agreed that, on the date of issuance of any Letter of Credit
and on each anniversary thereof prior to the date of termination of such Letter
of Credit, if $500 will exceed the amount of Facing Fees that will accrue with
respect to such Letter of Credit for the immediately succeeding 12-month period,
the full $500 shall be payable on the date of issuance of such Letter of Credit
and on each such anniversary thereof prior to the termination of such Letter of
Credit. Accrued Facing Fees shall be due and payable quarterly in arrears on
each Quarterly Payment Date and on the date upon which the Total Revolving Loan
Commitment has been terminated and such Letter of Credit has been terminated in
accordance with its terms.
(d) The Borrower shall pay to the Issuing Bank, upon each
payment under, issuance of, or amendment to, any Letter of Credit, such amount
as shall at the time of such event be the administrative charge and
out-of-pocket expenses which the respective Issuing Bank is generally imposing
in connection with such occurrence with respect to letters of credit.
(e) The Borrower shall pay to the Agent, for its own account,
such other fees as have been agreed to in writing by the Borrower and the Agent.
3.02 Voluntary Termination of Unutilized Commitments. (a) Upon
at least two Business Days' prior written notice (or telephonic notice promptly
confirmed in writing) to the Agent at its Notice Office (which notice the Agent
shall promptly transmit to each of the Banks), the Borrower shall have the
right, at any time or from time to time, without premium or penalty, to
terminate (i) if prior to the Initial Borrowing Date, the Total Revolving Loan
Commitment (and the Revolving Loan Commitments of each Bank), in whole, or (ii)
if after the Initial Borrowing Date the
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26
Total Unutilized Revolving Loan Commitment, in whole or in part, in integral
multiples of $200,000 in the case of partial reductions to the Total Unutilized
Revolving Loan Commitment, provided that (A) each such reduction shall apply
proportionately to permanently reduce the Revolving Loan Commitment of each Bank
and (B) the reduction to the Total Unutilized Revolving Loan Commitment shall in
no case be in an amount which would cause the Revolving Loan Commitment of any
Bank to be reduced (as required by preceding clause (A)) by an amount which
exceeds the Unutilized Revolving Loan Commitment of such Bank as in effect
immediately before giving effect to such reduction.
(b) In the event of certain refusals by a Bank as provided in
Section 13.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower may, upon five Business Days' written notice to the
Agent at its Notice Office (which notice the Agent shall promptly transmit to
each of the Banks) terminate all of the Revolving Loan Commitment of such Bank
so long as all Loans, together with accrued and unpaid interest, Fees and all
other amounts, owing to such Bank (other than amounts owing in respect of any
Tranche of Loans maintained by such Bank, if such Tranche of Loans are not being
repaid pursuant to Section 13.12(b)) are repaid concurrently with the
effectiveness of such termination (at which time Schedule I shall be deemed
modified to reflect such changed amounts), and at such time, unless the
respective Bank continues to have outstanding Loans and/or Commitments
hereunder, such Bank shall no longer constitute a "Bank" for purposes of this
Agreement, except with respect to indemnifications under this Agreement
(including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 13.01 and
13.06), which shall survive (subject to Section 13.15) as to such repaid Bank.
3.03 Mandatory Reduction of Commitments. (a) The Total
Revolving Loan Commitment (and the Revolving Loan Commitment of each Bank) shall
terminate in its entirety on December 31, 1996 unless the Initial Borrowing Date
shall have occurred on or prior to such date.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Revolving Loan Commitment (and the
Revolving Loan Commitment of each Bank) shall terminate in its entirety on the
Revolving Loan Maturity Date.
(c) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Bank) shall terminate in its entirety on the Restatement Date
(after giving effect to the making of the Term Loans on such date).
(d) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, on each date after the Restatement Date upon
which a mandatory prepayment of Term Loans pursuant to Section 4.02(c), (d),
(e), (g) or (j) (as a result of the application of the other requirements of
Section 4.02) is required (and exceeds in amount the aggregate principal amount
of Term Loans then outstanding) or would be required if Term Loans were then out
standing, the Total Revolving Loan Commitment shall be permanently reduced by
the amount, if any, by which the
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27
amount required to be applied pursuant to said Section (determined as if an
unlimited amount of Term Loans were actually outstanding) exceeds the aggregate
principal amount of Term Loans then outstanding.
(e) Each reduction to the Total Term Loan Commitment and the
Total Revolving Loan Commitment pursuant to this Section 3.03 (or pursuant to
Section 4.02) shall be applied proportionately to reduce the Term Loan
Commitment or the Revolving Loan Commitment, as the case may be, of each Bank
with such a Commitment.
SECTION 4. PREPAYMENTS; PAYMENTS; TAXES.
4.01 Voluntary Prepayments. The Borrower shall have the right
to prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Agent prior to 12:00 Noon (New York time) at its Notice Office
(A) on the date that a prepayment of Base Rate Loans is to be made prior written
notice (or telephonic notice promptly confirmed in writing) of its intent to
prepay Base Rate Loans and (B) at least three Business Days' prior written
notice (or telephonic notice promptly confirmed in writing) of its intent to
prepay Eurodollar Loans, whether Term Loans or Revolving Loans shall be prepaid,
the amount of such prepayment and the Types of Loans to be prepaid and, in the
case of Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which
made, which notice the Agent shall promptly transmit to each of the Banks; (ii)
each prepayment shall be in an aggregate principal amount of at least $50,000,
provided that if any partial prepayment of Eurodollar Loans made pursuant to any
Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such
Borrowing to an amount less than (1) in the case of Term Loans, $500,000, and
(2) in the case of Revolving Loans, $200,000, then such Borrowing may not be
continued as a Borrowing of Eurodollar Loans and any election of an Interest
Period with respect thereto given by the Borrower shall have no force or effect;
(iii) prepayments of Eurodollar Loans made pursuant to this Section 4.01 on any
day other than the last day of an Interest Period applicable thereto shall be
accompanied by the amounts required under Section 1.11; (iv) each prepayment in
respect of any Loans made pursuant to a Borrowing shall, except as set forth in
clause (v) and (vi) below, be applied pro rata among the Banks which made such
Loans; (v) in the event of certain refusals by a Bank as provided in Section
13.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower may, upon five Business Days' written notice to the
Agent at its Notice Office (which notice the Agent shall promptly transmit to
each of the Banks) repay all Loans, together with accrued and unpaid interest,
Fees, and other amounts owing to such Bank (or owing to such Bank with respect
to each Tranche which gave rise to the need to obtain such Bank's individual
consent) in accordance with said Section 13.12(b) so long as (A) in the case of
the repayment of Revolving Loans of any Bank pursuant to this clause (v) the
Revolving Loan Commitment of such Bank is terminated concurrently with such
repayment (at which time Schedule I shall be deemed modified to reflect the
changed Revolving Loan Commitments) and (B) the consents required by Section
13.12(b) in connection with the repayment pursuant to this clause (v) have been
obtained; and (vi) each voluntary prepayment of Term Loans pursuant to this
Section 4.01 (except pursuant
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to preceding clause (v)) shall be applied to the Term Loans on a pro rata basis
(based upon the then outstanding principal amount of Term Loans); provided that
at the Borrower's election in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01, such prepayment shall not be applied to any
Revolving Loan of a Defaulting Bank. Each prepayment of principal of Term Loans
pursuant to this Section 4.01 shall be applied to reduce the then remaining
Scheduled Repayments of the Term Loans pro rata based upon the then remaining
amounts of Scheduled Repayments of the Term Loans after giving effect to all
prior reductions thereto; provided further, that repayments of Term Loans
pursuant to clause (v) of this Section 4.01 shall only apply to reduce the then
remaining Scheduled Repayments to the extent the Term Loans so repaid are not
replaced pursuant to Section 13.12(b).
4.02 Mandatory Repayments. (a) (i) On any day on which the sum
of the aggregate outstanding principal amount of the Revolving Loans made by
Non-Defaulting Banks and the Letter of Credit Outstandings exceeds the Adjusted
Total Revolving Loan Commitment as then in effect, the Borrower shall prepay
Revolving Loans of Non-Defaulting Banks in an amount equal to such excess. If,
after giving effect to the prepayment of all outstanding Revolving Loans of
Non-Defaulting Banks, the aggregate amount of the Letter of Credit Outstandings
exceeds the Adjusted Total Revolving Loan Commitment as then in effect, the
Borrower shall pay to the Agent at the Payment Office on such date an amount of
cash or Cash Equivalents equal to the amount of such excess (up to a maximum
amount equal to the Letter of Credit Outstandings at such time), such cash or
Cash Equivalents to be held as security for all obligations of the Borrower to
Non-Defaulting Banks hereunder in a cash collateral account to be established by
the Agent.
(ii) On any day on which the aggregate outstanding principal
amount of the Revolving Loans made by any Defaulting Bank exceeds the Revolving
Loan Commitment of such Defaulting Bank, the Borrower shall prepay principal of
Revolving Loans of such Defaulting Bank in an amount equal to such excess.
(b) In addition to any other mandatory repayments pursuant to
this Section 4.02, on each date set forth below, the Borrower shall be required
to repay that principal amount of Term Loans, to the extent then outstanding, as
is set forth opposite such date (each such repayment, as the same may be reduced
as provided in Sections 4.01 and 4.02(h) and (i), a "Scheduled Repayment," and
each such date, a "Scheduled Repayment Date"):
Scheduled Repayment Date Amount
------------------------ ------
The Last Business Day
of June, 1998 $400,000
The Last Business Day
of September, 1998 $400,000
The Last Business Day
of December, 1998 $400,000
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The Last Business Day
of March, 1999 $550,000
The Last Business Day
of June, 1999 $550,000
The Last Business Day
of September, 1999 $550,000
The Last Business Day
of December, 1999 $550,000
The Last Business Day
of March, 2000 $750,000
The Last Business Day
of June, 2000 $750,000
The Last Business Day
of September, 2000 $750,000
The Last Business Day
of December, 2000 $750,000
The Last Business Day
of March, 2001 $800,000
The Last Business Day
of June, 2001 $800,000
The Last Business Day
of September, 2001 $800,000
The Last Business Day
of December, 2001 $800,000
The Last Business Day
of March, 2002 $850,000
The Last Business Day
of June, 2002 $850,000
The Last Business Day
of September, 2002 $850,000
The Last Business Day
of December, 2002 $850,000
The Last Business Day
of March, 2003 $900,000
The Last Business Day
of June, 2003 $900,000
The Last Business Day
of September, 2003 $900,000
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The Last Business Day
of December, 2003 $900,000
Term Loan Maturity Date $900,000
; provided that in the event the aggregate principal amount of Term Loans
incurred at the time that the Total Term Loan Commitment is terminated in
accordance with Section 3.03(c) is less than $17,500,000, an amount equal to
such deficiency shall be applied to reduce the Scheduled Repayments pro rata
based on the then remaining principal amount of each such Scheduled Repayment.
(c) In addition to any other mandatory repayments pursuant to
this Section 4.02, on each date after the Restatement Date upon which Holdings
or any of its Subsidiaries receives any proceeds from any sale or issuance of
its equity or Holdings receives any amount as a capital contribution (other than
(i) proceeds received from the issuance of Holdings Common Stock on or prior to
the Restatement Date, (ii) proceeds received as a result of any issuance after
the Restatement Date of Holdings Common Stock to directors, executives,
officers, members of management, employees or consultants of Holdings, the
Borrower or any of their Subsidiaries pursuant to, and as described in, Section
9.03(v), to the extent that the aggregate proceeds (after deduction of amounts
used to purchase Holdings Common Stock in the case of issuance of the type
described in Section 9.03(v)) excluded pursuant to this clause (ii) do not
exceed $1,000,000, and (iii) so long as no Default or Event of Default then
exists, (A) 100% of the proceeds received after the Restatement Date of Holdings
Common Stock and capital contributions in an aggregate amount not exceeding
$5,000,000 (the "Initial Equity Basket Amount") and (B) 50% of the proceeds
received after the Restatement Date of Holdings Common Stock and capital
contributions in excess of the Initial Equity Basket Amount) an amount equal to
100% of the cash proceeds of the respective sale or issuance or capital
contribution (net of underwriting discounts and commissions and other direct
costs associated therewith, including, without limitation, legal fees and
expenses) shall be applied as a mandatory repayment of principal of outstanding
Term Loans, all in accordance with the requirements of Sections 4.02(h) and (i).
(d) In addition to any other mandatory repayments pursuant to
this Section 4.02, on each date after the Restatement Date upon which Holdings
or any of its Subsidiaries receives any proceeds from any incurrence by Holdings
or any of its Subsidiaries of Indebtedness for borrowed money (other than
Indebtedness for borrowed money permitted to be incurred pursuant to Section
9.04 as such Section is in effect on the Restatement Date), an amount equal to
100% of the cash proceeds (net of all reasonable costs associated therewith
including, without limitation, all underwriting discounts and commissions and
other costs associated therewith, legal fees and expenses, due diligence costs
and expenses, all financing and/or commitment fees and other direct costs
associated therewith) of the respective incurrence of Indebtedness shall be
applied as a mandatory repayment of principal of outstanding Term Loans, all in
accordance with the requirements of Sections 4.02(h) and (i).
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(e) In addition to any other mandatory repayments pursuant to
this Section 4.02, on each date after the Restatement Date upon which Holdings
or any of its Subsidiaries receives proceeds from any sale of assets (including
capital stock and securities held thereby, but excluding (i) sales or transfers
of inventory in the ordinary course of business (including, without limitation,
sales or transfers of inventory to Subsidiaries at fair market value), (ii) the
sale or other disposition of obsolete equipment, (iii) the sales of overdue
receivables in the ordinary course of business, (iv) the licensing of general
intangibles in the ordinary course of business, (v) the first $1,000,000 of Net
Sale Proceeds in any Fiscal Year from sales of other assets after the
Restatement Date and (vi) sales of assets between the Borrower and its
Wholly-Owned Subsidiaries and/or sales of assets between Wholly-Owned
Subsidiaries of the Borrower, in each case to the extent permitted by Section
9.02), an amount equal to 100% of the Net Sale Proceeds therefrom shall be
applied as a mandatory repayment of principal of outstanding Term Loans, all in
accordance with the requirements of Sections 4.02(h) and (i); provided, however,
that up to an aggregate of $5,000,000 of Net Sale Proceeds in any Fiscal Year
shall not be required to be used as a mandatory repayment to the extent the
Borrower elects, as hereinafter provided, to cause such Net Sale Proceeds to be
reinvested in Reinvestment Assets (a "Reinvestment Election"). The Borrower may
exercise its Reinvestment Election (within the parameters specified in the
preceding sentence) with respect to a sale of assets if (x) no Default or Event
of Default exists and (y) the Borrower delivers a Reinvestment Notice to the
Agent on or prior to the date of the consummation of the respective sale of
assets, with such Reinvestment Election being effective with respect to the Net
Sale Proceeds of such sale of assets equal to the Anticipated Reinvestment
Amount specified in such Reinvestment Notice.
(f) In addition to any other mandatory repayments pursuant to
this Section 4.02, on each Excess Cash Payment Date, an amount equal to 75% (or,
if the Leverage Ratio as of the end of the most recent Excess Cash Payment
Period is less than 3.5:1, 50%) of the Excess Cash Flow for the relevant Excess
Cash Payment Period shall be applied as a mandatory repayment of principal of
outstanding Term Loans in accordance with the requirements of Sections 4.02(h)
and (i).
(g) In addition to any other mandatory repayments pursuant to
this Section 4.02, within 10 days following each date after the Restatement Date
on which Holdings or any of its Subsidiaries receives any proceeds from any
Recovery Event, an amount equal to 100% of the proceeds of such Recovery Event
(net of reasonable costs including, without limitation, legal costs and
expenses, and taxes incurred in connection with such Recovery Event and other
than the proceeds of business interruption insurance) shall be applied as a
mandatory repayment of principal of outstanding Term Loans, all in accordance
with the requirements of Sections 4.02(h) and (i); provided, however, that (A)
so long as no Default or Event of Default then exists and such proceeds do not
exceed $5,000,000, such proceeds shall not be required to be so applied on such
date to the extent that the Borrower has delivered a certificate to the Agent on
or prior to such date stating that such proceeds shall be used or shall be
committed to be used to replace or restore any properties or assets in respect
of which such proceeds were paid within one year following the date of such
Recovery Event (which certificate shall set forth the estimates of the proceeds
to be so expended) and (B) so long as no Default or Event of Default then exists
and to the extent that (1) the amount of such proceeds exceeds $5,000,000, (2)
the amount of such proceeds, together with other cash
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available to the Borrower and permitted to be spent by it on Capital
Expenditures during the relevant period pursuant to Section 9.07, equals 100% of
the cost of replacement or restoration of the properties or assets in respect
of which such proceeds were paid as determined by the Borrower and as supported
by such estimates or bids from contractors or subcontractors or such other
supporting information as the Agent may reasonably request, (3) the Borrower has
delivered to the Agent a certificate on or prior to the date the application
would otherwise be required pursuant to this Section 4.02(g) in the form
described in clause (A) above and also certifying its determination as required
by preceding clause (2) and certifying the sufficiency of business interruption
insurance as required by succeeding clause (4), and (4) the Borrower has
delivered to the Agent such evidence as the Agent may reasonably request in form
and substance reasonably satisfactory to the Agent establishing that the
Borrower has sufficient business interruption insurance and that the Borrower
will be receiving regular payments thereunder in such amounts and at such times
as are necessary to satisfy all obligations and expenses of the Borrower
(including, without limitation, all debt service requirements, including
pursuant to this Agreement) without any delay or extension thereof, for the
period from the date of the respective casualty, condemnation or other event
giving rise to the Recovery Event and continuing through the completion of the
replacement or restoration of respective properties or assets, then the entire
amount of the proceeds of such Recovery Event and not just the portion in excess
of $5,000,000 shall be deposited with the Agent pursuant to a cash collateral
arrangement reasonably satisfactory to the Agent whereby such proceeds shall be
disbursed to the Borrower from time to time as needed to pay actual costs
incurred by it in connection with the replacement or restoration of the
respective properties or assets (pursuant to such certification requirements as
may reasonably be established by the Agent); and provided further that at any
time while an Event of Default has occurred and is continuing (other than an
Event of Default existing solely as a result of the violation of any or all of
Sections 9.08 through 9.10, inclusive, but in each case only if, and to the
extent, that the violation of said covenant has occurred as a result of the
underlying event giving rise to the Recovery Event), the Required Banks may
direct the Agent (in which case the Agent shall, and is hereby authorized by the
Borrower to, follow said directions) to apply any or all proceeds then on
deposit in such collateral account to the repayment of Obligations hereunder in
the same manner as proceeds would be applied pursuant to the Security Agreement;
and provided further that if all or any portion of such proceeds not required to
be applied to the repayment of Term Loans pursuant to the second preceding
proviso (whether pursuant to clause (A) or (B) thereof) are either (x) not so
used or committed to be so used within one year after the date of the respective
Recovery Event or (y) if committed to be used within one year after the date of
receipt of such proceeds and not so used within 18 months after the date of the
respective Recovery Event then, in either such case, such remaining portion not
used or committed to be used in the case of preceding clause (x) and not used in
the case of preceding clause (y) shall be applied on the date which is the first
anniversary of the date of the respective Recovery Event in the case of clause
(x) above or the date occurring 18 months after the date of the respective
Recovery Event in the case of clause (y) above as a mandatory repayment of
principal of outstanding Term Loans in accordance with the requirements of
Sections 4.02(h) and (i).
(h) Any amount required to be applied to Term Loans pursuant
to Sections 4.02(c) through (g) and (j) shall be applied to repay the
outstanding principal amount of Term Loans then
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outstanding. The amount of each principal repayment of Term Loans made as
required by Sections 4.02(c) through (g) and (j) shall be applied to reduce the
then remaining Scheduled Repayments pro rata based upon the then remaining
amount of Scheduled Repayments after giving effect to all prior reductions
thereto.
(i) With respect to each repayment of Loans required by this
Section 4.02, the Borrower may designate the Types of Loans which are to be
repaid and, in the case of Eurodollar Loans, the specific Borrowing or
Borrowings of the respective Tranche pursuant to which made, provided that: (i)
repayments of Eurodollar Loans pursuant to this Section 4.02 may only be made on
the last day of an Interest Period applicable thereto unless all Eurodollar
Loans of the respective Tranche with Interest Periods ending on such date of
required repayment and all Base Rate Loans of the respective Tranche have been
paid in full; (ii) if any repayment of Eurodollar Loans made pursuant to a
single Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to
such Borrowing to an amount less than (x) in the case of Term Loans, $500,000
and (y) in the case of Revolving Loans, $200,000, such Borrowing shall be
converted at the end of the then current Interest Period into a Borrowing of
Base Rate Loans and (iii) each repayment of any Loans made pursuant to a
Borrowing shall be applied pro rata among such Loans. In the absence of a
designation by the Borrower as described in the preceding sentence, the Agent
shall, subject to the above, make such designation in its sole discretion with a
view, but no obligation, to minimize breakage costs owing under Section 1.11.
Notwithstanding the foregoing provisions of this Section 4.02, if any time the
mandatory prepayment of Loans pursuant to Sections 4.02(c) through (g) above or
a repayment arising out of the application of Section 9.05(ii) would result,
after giving effect to the procedures set forth above, in the Borrower incurring
breakage costs under Section 1.11 as a result of Eurodollar Loans being prepaid
other than on the last day of an Interest Period applicable thereto (the
"Affected Eurodollar Loans"), then the Borrower may, in its sole discretion,
initially deposit a portion (up to 100%) of the amounts that otherwise would
have been paid in respect of the Affected Eurodollar Loans with the Agent (which
deposit must be equal in amount to the amount of Affected Eurodollar Loans not
immediately prepaid) to be held as security for the obligations of the Borrower
hereunder pursuant to a cash collateral agreement to be entered into in form and
substance reasonably satisfactory to the Agent, with such cash collateral to be
directly applied upon the first occurrence (or occurrences) thereafter of the
last day of an Interest Period applicable to the relevant Loans that are
Eurodollar Loans (or such earlier date or dates as shall be requested by the
Borrower), to repay an aggregate principal amount of such Loans equal to the
Affected Eurodollar Loans not initially repaid pursuant to this sentence.
Notwithstanding anything to the contrary contained in the immediately preceding
sentence, all amounts deposited as cash collateral pursuant to the immediately
preceding sentence shall be held for the sole benefit of the Banks whose Loans
would otherwise have been immediately repaid with the amounts deposited and upon
the taking of any action by the Agent or the Banks pursuant to the remedial
provisions of Section 10, any amounts held as cash collateral pursuant to this
Section 4.02(i) shall, subject to the requirements of applicable law, be
immediately applied to the applicable Loans.
(j) On the Reinvestment Prepayment Date with respect to a
Reinvestment Election, an amount equal to the Reinvestment Prepayment Amount, if
any, for such Reinvestment Election
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shall be applied as a repayment of the principal amount of the then outstanding
Term Loans in accordance with the requirements of Sections 4.02(h) and (i).
4.03 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement or any Note
shall be made to the Agent for the account of the Bank or Banks entitled thereto
not later than 1:00 P.M. (New York time) on the date when due and shall be made
in Dollars in immediately available funds at the Payment Office of the Agent.
Whenever any payment to be made hereunder or under any Note shall be stated to
be due on a day which is not a Business Day, the due date thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest shall be payable at the applicable rate during such
extension.
4.04 Net Payments. (a) All payments made by the Borrower
hereunder or under any Note will be made without setoff, counterclaim or other
defense. Except as provided in Section 4.04(b), all such payments will be made
free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction or by any political
subdivision or taxing authority thereof or therein with respect to such payments
(but excluding, except as provided in the second succeeding sentence, any tax
imposed on or measured by the net income or profits of a Bank, or any franchise
tax based on the net income or profits of a Bank, in either case pursuant to the
laws of the United States of America, the jurisdiction in which it is organized
or the jurisdiction in which the principal office or applicable lending office
of such Bank is located or any subdivision thereof or therein) and all interest,
penalties or similar liabilities with respect thereto (all such non-excluded
taxes, levies, imports, duties, fees, assessments or other charges being
referred to collectively as "Taxes"). If any such Taxes are so levied or
imposed, the Borrower agrees to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Agreement or under any Note, after withholding or deduction for or on
account of any Taxes, will not be less than the amount provided for herein or in
such Note. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse each Bank, upon the written
request of such Bank, for taxes imposed on or measured by the net income or
profits of such Bank, or any franchise tax based on the net income or profits of
such Bank, in either case pursuant to the laws of the jurisdiction in which the
principal office or applicable lending office of such Bank is located or under
the laws of any political subdivision or taxing authority of any such
jurisdiction in which the principal office or applicable lending office of such
Bank is located and for any withholding of income or similar taxes imposed by
the United States of America as such Bank shall determine are payable by, or
withheld from, such Bank in respect of such amounts so paid to or on behalf of
such Bank pursuant to the preceding sentence and in respect of any amounts paid
to or on behalf of such Bank pursuant to this sentence. The Borrower will
furnish to the Agent within 45 days after the date the payment of any Taxes is
due pursuant to applicable law certified copies of tax receipts evidencing such
payment by the Borrower. The Borrower agrees to indemnify and hold harmless each
Bank, and reimburse such Bank upon its written request, for the amount of any
Taxes so levied or imposed and paid by such Bank.
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(b) Each Bank which is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees (i) in the case of any such Bank that is a "bank" within the
meaning of Section 881(c)(3)(A) of the Code and which constitutes a Bank
hereunder on the Initial Borrowing Date, to provide to the Borrower and the
Agent on or prior to the Initial Borrowing Date two original signed copies of
Internal Revenue Service Form 4224 or Form 1001 certifying to such Bank's
entitlement to an exemption from United States withholding tax with respect to
payments to be made under this Agreement and under any Note, (ii) in the case of
any such Bank that is a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, that, to the extent legally entitled to do so, (A) with respect to a Bank
that is an assignee or transferee of an interest under this Agreement pursuant
to Section 1.13 or 13.04 (unless the respective Bank was already a Bank
hereunder immediately prior to such assignment or transfer), upon the date of
such assignment or transfer to such Bank, and (B) with respect to any such Bank,
from time to time upon the reasonable written request of the Borrower or the
Agent after the Initial Borrowing Date, such Bank will provide to the Borrower
and the Agent two original signed copies of Internal Revenue Service Form 4224
or Form 1001 (or any successor forms) certifying to such Bank's entitlement to
an exemption from, or reduction in, United States withholding tax with respect
to payments to be made under this Agreement and under any Note, (iii) in the
case of any such Bank (other than a Bank described in clause (i) or (ii) above)
which constitutes a Bank hereunder on the Initial Borrowing Date, to provide to
the Borrower and the Agent, on or prior to the Initial Borrowing Date (A) a
certificate substantially in the form of Exhibit D attached hereto (any such
certificate, a "Section 4.04(b)(iii) Certificate") and (B) two accurate and
complete original signed copies of Internal Revenue Service Form W-8, certifying
to such Bank's entitlement at the date of such certificate (assuming compliance
by the Borrower with Section 13.17) to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Code with respect to payments to
be made under this Agreement and under any Note and (iv) in the case of any such
Bank (other than a Bank described in clause (i) or (ii) above), to the extent
legally entitled to do so, (A) with respect to a Bank that is an assignee or
transferee of an interest under this Agreement pursuant to Section 1.13 or 13.04
(unless the respective Bank was already a Bank hereunder immediately prior to
such assignment or transfer), upon the date of such assignment or transfer to
such Bank, and (B) with respect to any such Bank, from time to time upon the
reasonable written request of the Borrower or the Agent after the Initial
Borrowing Date, to provide to the Borrower and the Agent such other forms as may
be required in order to establish the entitlement of such Bank to an exemption
from or reduction in withholding with respect to payments under this Agreement
and under any Note. Notwithstanding anything to the contrary contained in
Section 4.04(a), but subject to the immediately succeeding sentence, the
Borrower shall be entitled, to the extent it is required to do so by law, to
deduct or with hold income or similar taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from interest,
fees or other amounts payable hereunder (without any obligation to pay the
respective Bank additional amounts with respect thereto) for the account of any
Bank which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes and which has not
provided to the Borrower such forms required to be provided to the Borrower
pursuant to the first sentence of this Section 4.04(b) (or to the extent such
forms do not establish a complete exemption from such withholding).
Notwithstanding anything to the contrary contained in the preceding sentence or
elsewhere in this
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Section 4.04 and except as set forth in Section 13.04(b), the Borrower agrees to
indemnify each Bank in the manner set forth in Section 4.04(a) (without regard
to the identity of the jurisdiction requiring the deduction or withholding) in
respect of any amounts deducted or withheld by it as described in the
immediately preceding sentence as a result of any changes after the Closing Date
in any applicable law, treaty, governmental rule, regulation, guideline or
order, or in the interpretation thereof, relating to the deducting or
withholding of income or similar Taxes.
(c) The provisions of this Section 4.04 are subject to the
provisions of Section 13.15 (to the extent applicable).
SECTION 5. CONDITIONS PRECEDENT TO EFFECTIVENESS OF AGREEMENT AND
FUNDING OF TERM LOAN. The amendments to the Existing Credit Agreement embodied
in this Agreement shall not be effective (in which case the Existing Credit
Agreement shall remain in full force and effect) and the Term Loan shall not be
funded unless and until the following conditions precedent have been satisfied,
in each case, on or prior to the Restatement Date:
5.01 Execution of Agreement; Term Notes. On the Restatement Date
(i) Holdings, the Borrower, the Agent and the Banks shall have duly executed and
delivered to the Agent, with a signed counterpart for each signatory a party
hereto, this Agreement, (ii) there shall have been delivered to the Agent for
the account of each of the Banks the appropriate Term Note executed by the
Borrower, in each case in the amount, maturity and as otherwise provided herein,
(iii) all of the Credit Documents shall be in full force and effect, and (iv) no
Default or Event of Default shall have occurred and be continuing or will occur
immediately after giving effect to the making of the Term Loan on the
Restatement Date and the consummation of the Acquisition and the other
transactions contemplated herein.
5.02 Existing Security Documents. The Collateral Agent shall have
received (i) such modifications to existing Security Documents and Mortgages,
(ii) such documentary, intangible or similar taxes with respect to the
Collateral and Mortgaged Properties and (iii) such additional and/or new title
insurance and title insurance endorsements with respect to the Mortgaged
Properties as may be necessary to maintain the Collateral Agent's perfected
security interest (including existing priority) in the Collateral and Mortgaged
Properties with respect to the Obligations under this Agreement (including,
without limitation, the Term Loans) and as the Collateral Agent may otherwise
reasonably request, together with assurances reasonably satisfactory to Agent
for the recordations of the modifications to the Mortgages in the real estate
records of all appropriate jurisdictions.
5.03 Fees; etc. On the Restatement Date, contemporaneously with
the receipt of proceeds of the Term Loan, the Borrower shall have paid to the
Agent and the Banks all costs, fees and expenses (including, without limitation,
legal fees and expenses) payable to the Agent and the Banks to the extent then
due.
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5.04 Opinions of Counsel. On the Restatement Date, the Agent
shall have received (i) from Vinson & Elkins L.L.P., counsel to the Credit
Parties, an opinion addressed to the Agent and each of the Banks and dated the
Restatement Date covering the matters set forth in Exhibit E attached hereto and
(ii) from Brown & Bain, P.A., Arizona local counsel to the Borrower and Atrium
Arizona, an opinion addressed to the Agent and each of the Banks and dated the
Restatement Date, each of which shall be in form and substance reasonably
satisfactory to the Agent and the Required Banks and shall cover the perfection
of the security interests granted pursuant to the Security Documents and such
other matters incident to the transactions contemplated herein as the Agent may
reasonably request.
5.05 Corporate Documents; Proceedings; etc. (a) On the
Restatement Date, the Agent shall have received a certificate of Holdings, the
Borrower and Atrium Arizona, dated the Restatement Date, signed by an Authorized
Officer and attested to by the Secretary or any Assistant Secretary of such
Credit Party, in the form of Exhibit F attached hereto with appropriate
insertions, together with copies of the Certificate of Incorporation and By-Laws
of such Credit Party and the resolutions of such Credit Party referred to in
such certificate, and the foregoing shall be reasonably acceptable to the Agent.
(b) On the Restatement Date, all corporate and legal proceedings
and all instruments and agreements in connection with the transactions
contemplated by this Agreement and the other Credit Documents shall be
reasonably satisfactory in form and substance to the Agent and the Required
Banks, and the Agent shall have received all information and copies of all
documents and papers, including records of corporate proceedings, governmental
approvals, good standing certificates and bring-down telegrams or facsimiles,
if any, which the Agent reasonably may have requested in connection therewith,
such documents and papers where appropriate to be certified by proper corporate
or governmental authorities.
5.06 Shareholders' Agreements; Management Agreements; Collective
Bargaining Agreements; Existing Debt Agreements; Tax Sharing Agreements. Prior
to the Restatement Date, there shall have been delivered to the Agent true and
correct copies, certified as true and complete by an appropriate officer of the
Borrower of (i) all agreements entered into by Holdings or any of its
Subsidiaries governing the terms and relative rights of its capital stock and
any agreements entered into by shareholders relating to any such entity with
respect to its capital stock (collectively, the "Shareholders' Agreements"),
(ii) all agreements with members of, or with respect to, the management of
Holdings or any of its Subsidiaries (collectively, the "Management Agreements"),
(iii) all collective bargaining agreements applying or relating to any employee
of Holdings or any of its Subsidiaries (collectively, the "Collective Bargaining
Agreements"), (iv) all agreements evidencing or relating to Indebtedness of
Holdings or any of its Subsidiaries which is to remain outstanding after giving
effect to the incurrence of Loans on the Restatement Date (collectively, the
"Existing Debt Agreements"); and (v) all agreements relating to the sharing of
tax liabilities and benefits among Holdings and/or its Subsidiaries (each a "Tax
Sharing Agreement" and collectively, the "Tax Sharing Agreements"); all of which
Shareholders' Agreements, Management Agreements, Collective Bargaining
Agreements, Existing Debt Agreements and Tax Sharing Agreements shall be in form
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and substance reasonably satisfactory to the Agent and the Required Banks and
shall be in full force and effect on the Restatement Date.
5.07 Capital Contributions; Stock Repurchase; etc. (a) On the
Initial Borrowing Date, there shall have been delivered to the Agent true and
correct copies, certified as true and complete by an Authorized Officer of the
Borrower, of the Recapitalization Documents, and all terms and conditions of the
Recapitalization Documents shall be reasonably satisfactory in form and
substance to the Agent. The Recapitalization Documents (and the transactions
contemplated thereby) shall have been duly approved by the board of directors
and (if required by applicable law) the stockholders of Holdings and the
Borrower, and all Recapitalization Documents shall have been duly executed and
delivered by the parties thereto and shall be in full force and effect. Each of
the conditions precedent to the obligations of Holdings and the Borrower to
consummate the Recapitalization as set forth in the Recapitalization Documents
shall have been satisfied and not waived or modified except with the consent of
the Agent, which consent shall not be unreasonably withheld, all to the
reasonable satisfaction of the Agent, and concurrently with the making of the
Revolving Loans on the Initial Borrowing Date the Recapitalization shall have
been consummated in accordance with the Recapitalization Documents and all
applicable laws, rules and regulations.
(b) On the Initial Borrowing Date, (i) the Borrower shall have
received gross cash proceeds in the amount of $100,000,000 from the sale and
issuance of the Senior Subordinated Notes (it being understood that such cash
proceeds shall include all amounts directly applied to pay underwriting and
placement commissions and discounts and related fees) which proceeds are
transferred to Holdings through intercompany loans and/or dividends, and (ii)
Holdings shall have received gross cash proceeds in an amount of at least
$32,000,000 in connection with the purchase by HMTF or an Affiliate thereof of
Holdings Common Stock (the "Equity Issuance") which proceeds, when aggregated
with the proceeds from the Senior Subordinated Notes and up to $3,600,000 of
Revolving Loans incurred by the Borrower on the Initial Borrowing Date, all of
which shall have been used to consummate the Transaction. The Equity Issuance
and the sale and issuance of the Senior Subordinated Notes shall have occurred
in accordance with the terms and conditions of the Recapitalization Documents.
(c) On the Initial Borrowing Date, Holdings shall have redeemed
the Redeemed Shares (the "Stock Redemption") from the Selling Shareholders, in
accordance with the terms and conditions of the Recapitalization Documents.
(d) On the Initial Borrowing Date, Holdings shall have purchased
the Redeemed Options (the "Options Repurchase") from the Selling Optionholders,
in accordance with the terms and conditions of the Recapitalization Documents.
(e) On the Initial Borrowing Date, each share of Holdings'
Preferred Stock, par value $1.00 per share (the "Redeemable Preferred Stock")
shall be redeemed (the "Preferred Stock Redemption") from Heritage Fund I, L.P.
in accordance with the Recapitalization Documents. After giving effect to the
Preferred Stock Redemption, Holdings shall have no preferred stock outstanding.
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5.08 Refinancing of Existing Credit Agreement. (a) On the Initial
Borrowing Date, the total commitments under the Existing Credit Agreement shall
have been terminated, and all loans and notes issued thereunder shall have been
repaid in full, together with interest thereon, and all other amounts owing
pursuant to the Existing Credit Agreement shall have been repaid in full and the
Existing Credit Agreement shall have been terminated and be of no further force
or effect except for indemnification obligations described therein which by
their terms specifically survive the repayment of the loans thereunder. The
Agent shall have received evidence in form, scope and substance reasonably
satisfactory to it that the matters set forth in this Section 5.07(a) have been
satisfied on such date.
(b) On the Initial Borrowing Date, the creditors under the
Existing Credit Agreement shall have terminated and released all security
interests and Liens on the assets owned or to be owned by the Borrower or any of
its Subsidiaries granted in connection with the Existing Credit Agreement. The
Agent shall have received such releases of security interests in and Liens on
the assets owned or to be owned by the Borrower as may have been reasonably
requested by the Agent, which releases shall be in form and substance reasonably
satisfactory to the Agent. Without limiting the foregoing, there shall have been
delivered (i) proper termination statements (Form UCC-3 or the appropriate
equivalent) for filing under the UCC of each jurisdiction where a financing
statement (Form UCC-1 or the appropriate equivalent) was filed with respect to
the Borrower or any of its Subsidiaries, or their respective predecessors in
interest, in connection with the security interests created with respect to
the Existing Credit Agreement and the documentation related thereto, (ii)
terminations or assignments of any security interest in, or Lien on, any
patents, trademarks, copyrights, or similar interests of the Borrower or any of
its Subsidiaries, on which filings have been made and (iii) terminations of all
mortgages, leasehold mortgages and deeds of trust created with respect to
property of the Borrower or any of its Subsidiaries, or their respective
predecessors in interest, in each case to secure the obligations under the
Existing Credit Agreement, all of which shall be in form and substance
reasonably satisfactory to the Agent.
5.09 Acquisition. On or prior to the Restatement Date, there
shall have been delivered to the Agent true and correct copies, certified (as to
the Asset Purchase Agreement) as true and complete by an Authorized Officer of
the Borrower, of the Acquisition Documents, and all terms and conditions of the
Acquisition Documents shall be reasonably satisfactory in form and substance to
the Agent. The Acquisition Documents (and the transactions contemplated thereby)
shall have been duly approved by the board of directors and (if required by
applicable law) the stockholders of Holdings and the Borrower, and all
Acquisition Documents shall have been duly executed and delivered by the parties
thereto and shall be in full force and effect. Each of the conditions precedent
to the obligations of the Borrower to consummate the Acquisition as set forth in
the Acquisition Documents shall have been satisfied and not waived or modified
in any material respect except with the consent of the Agent, which consent
shall not be unreasonably withheld, all to the reasonable satisfaction of the
Agent, and, concurrently with the making of the Term Loans on the Restatement
Date, the Acquisition shall have been consummated in accordance with the
Acquisition Documents and all applicable laws, rules and regulations.
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5.10 Prepayment of Indebtedness and Release of Liens. (a) On or
prior to the Restatement Date or concurrently with the Credit Events then
occurring, all of the existing Indebtedness which is secured by any Liens on the
assets acquired by the Borrower in the Acquisition (other than Permitted Liens)
shall have been repaid in full and the instruments and documents thereunder
shall have been terminated and be of no further force or effect except for
indemnification obligations described therein which by their terms specifically
survive the repayment of the loans thereunder. The Agent shall have received
evidence in form, scope and substance reasonably satisfactory to it that the
matters set forth in this Section 5.09(a) have been satisfied on such date.
(b) On or prior to the Restatement Date or concurrently with the
Credit Events then occurring, there shall have been terminated and released all
Liens on the assets to be acquired by the Borrower in the Acquisition (other
than Permitted Liens). The Agent shall have received such releases of such Liens
on the assets to be acquired by the Borrower as may have been reasonably
requested by the Agent, which releases shall be in form and substance reasonably
satisfactory to the Agent. Without limiting the foregoing, there shall have been
delivered (i) proper termination statements (Form UCC-3 or the appropriate
equivalent) for filing under the UCC of each jurisdiction where a financing
statement (Form UCC-1 or the appropriate equivalent) was filed with respect to
such assets, (ii) terminations or assignments of any security interest in, or
Lien on, any patents, trademarks, copyrights, or similar interests to be
acquired by the Borrower, on which filings have been made and (iii) terminations
of all mortgages, leasehold mortgages and deeds of trust created with respect to
property to be acquired by the Borrower, all of which shall be in form and
substance satisfactory to the Agent.
5.11 Environmental Indemnity Agreement. On or prior to the
Restatement Date, the Collateral Agent shall have received a duly authorized and
fully executed environmental indemnity agreement substantially in the form of
Exhibit G attached hereto (as amended, restated, supplemental or otherwise
modified from time to time, the "Environmental Indemnity Agreement") from
Holdings and its Subsidiaries.
5.12 Pledge Agreement. On or prior to the Restatement Date,
Holdings, the Borrower and each Subsidiary Guarantor shall have duly authorized,
executed and delivered a Pledge Agreement in the form of Exhibit H attached
hereto, together with such changes (or with such other documents) as may be
requested by the Collateral Agent in connection with local law (as amended,
restated, supplemented or otherwise modified from time to time, the "Pledge
Agreement") and shall have delivered to the Collateral Agent, as pledgee
thereunder, all the Pledged Securities referred to therein, endorsed in blank in
the case of promissory notes constituting Pledged Securities, and executed and
undated stock powers in the case of capital stock constituting Pledged
Securities.
5.13 Security Agreement. On or prior to the Restatement Date,
Holdings, the Borrower and each Subsidiary Guarantor shall have duly authorized,
executed and delivered a Security Agreement in the form of Exhibit I attached
hereto, together with such changes (or with such other documents) as may be
requested by the Collateral Agent in connection with local law (as amended,
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restated, supplemented or otherwise modified from time to time, the "Security
Agreement") covering all of each Credit Party's present and future Security
Agreement Collateral, together with:
(a) proper financing statements (Form UCC-1) fully executed for
filing under the UCC in the appropriate filing offices of each
jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by the Security Agreement;
(b) certified copies of requests for information or copies (Form
UCC-11), or equivalent reports, listing all effective financing statements
that name Atrium Arizona, Masterview California and Masterview Window, as
debtor and that are filed in the jurisdictions referred to in clause (a)
above, together with copies of such other financing statements (none of
which shall cover the Collateral except to the extent evidencing Permitted
Liens or in respect of which the Collateral Agent shall have received
termination statements (Form UCC-3) or such other termination statements
as shall be required by local law) fully executed for filing;
(c) evidence of the completion of all other recordings and
filings of, or with respect to, the Security Agreement as may be necessary
or, in the reasonable opinion of the Collateral Agent, desirable to
perfect the security interests intended to be created by the Security
Agreement; and
(d) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable to perfect and
protect the security interests purported to be created by the Security
Agreement have been taken.
5.14 Subsidiary Guaranty. On or prior to the Restatement Date,
each Subsidiary Guarantor shall have duly authorized, executed and delivered a
Subsidiary Guaranty in the form of Exhibit J attached hereto (as amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms hereof and thereof, the "Subsidiary Guaranty"), and the
Subsidiary Guaranty shall be in full force and effect.
5.15 Mortgages; Title Insurance; Surveys; Etc. On or prior to the
Restatement Date, the Collateral Agent shall have received:
(a) fully executed counterparts of mortgages or deeds of trust to
secure debt in form and substance reasonably satisfactory to the Agent (as
may be amended, restated, supplemented or otherwise modified from time to
time, each a "Mortgage", and collectively, the "Mortgages"), which
Mortgages shall cover such of the Real Properties owned in fee designated
on Schedule III attached hereto (each a "Mortgaged Property", and
collectively, the "Mortgaged Properties"), together with evidence that
counterparts of the Mortgages have been delivered to the title insurance
company insuring the Liens of the Mortgages for recording in all places
to the extent necessary or, in the reasonable opinion of the Collateral
Agent, desirable to effectively create valid and enforceable first
priority mortgage liens on the Mortgaged Properties in favor of the
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Collateral Agent (or such other trustee as may be required or desired
under local law) for the benefit of the Secured Creditors;
(b) mortgagee title insurance policies on the Mortgaged
Properties issued by title insurers satisfactory to the Collateral Agent
(each a "Mortgage Policy", and collectively, the "Mortgage Policies") in
amounts satisfactory to the Agent assuring the Collateral Agent that the
Mortgages on such Mortgaged Properties are valid and enforceable first
priority mortgage liens on the Mortgaged Properties, free and clear of all
defects and encumbrances except Permitted Encumbrances and such Mortgage
Policies shall otherwise be in form and substance reasonably satisfactory
to the Agent and shall include, as appropriate and to the extent available
in the applicable jurisdiction, an endorsement for future advances under
this Agreement and the Notes and for any other matter that the Collateral
Agent in its reasonable discretion may reasonably request, shall not
include an exception for mechanics' liens, and shall provide for
affirmative insurance as reasonably requested by the Agent; and
(c) except as separately agreed by the Agent, surveys (or updates
of existing surveys), in form and substance satisfactory to the Collateral
Agent of each Mortgaged Property, if any, designated as "Owned" on
Schedule III hereto, dated a recent date acceptable to the Collateral
Agent and certified in a manner satisfactory to the Collateral Agent by a
licensed professional surveyor satisfactory to the Agent.
5.16 Consent Letter. On or prior to the Restatement Date, the
Agent shall have received a letter from CT Corporation System, presently
located at 1633 Broadway, New York, New York 10019, substantially in the form of
Exhibit K attached hereto, indicating its consent to its appointment by each
Credit Party as its agent to receive service of process as specified in Section
13.08.
5.17 Adverse Change; Etc. (a) On the Restatement Date, after
giving effect to the Acquisition, nothing shall have occurred since December 31,
1996 (and the Banks shall have become aware of no facts, conditions or other
information not previously known) which the Agent reasonably believe could have
a material adverse effect on the rights or remedies of the Agent or the Banks,
or on the ability of any Credit Party to perform its obligations to the Agent
and the Banks or which the Agent reasonably believe could have a material
adverse effect on the Acquisition or a Material Adverse Effect.
(b) On or prior to the Restatement Date, all necessary and
material governmental (domestic and foreign) and third party approvals in
connection with the Acquisition and the transactions contemplated by the Credit
Documents and otherwise referred to herein or therein shall have been obtained
and remain in effect, and all applicable waiting periods shall have expired
without any action being taken by any competent authority which restrains,
prevents or imposes materially adverse conditions upon the consummation of the
Acquisition and the transactions contemplated by this Agreement. Additionally,
there shall not exist any judgment, order, injunction or other restraint issued
or filed or a hearing seeking injunctive relief or other restraint pending or
notified
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prohibiting or imposing materially adverse conditions upon the consummation of
the Acquisition or the transactions contemplated by this Agreement.
5.18 Litigation. On the Restatement Date, no litigation by any
entity (private or governmental) shall be pending or, to the knowledge of the
Borrower or Holdings, threatened with respect to the Acquisition or this
Agreement or any documentation executed in connection therewith, or which the
Agent or the Required Banks shall reasonably believe could have a materially
adverse effect on the Acquisition or a Material Adverse Effect.
5.19 Solvency Certificate; Environmental Analyses; Insurance. On
or prior to the Restatement Date, the Borrower shall cause to be delivered to
the Agent:
(i) a solvency certificate addressed to the Agent and each of the
Banks and dated the Restatement Date from the Chief Financial Officer of
the Borrower, which solvency certificate shall be in the form of Exhibit L
attached hereto (appropriately completed) expressing opinions of value and
other appropriate factual information regarding the solvency of Holdings
and its Subsidiaries (on a consolidated basis), and the Borrower (on a
stand-alone basis), after giving effect to the Acquisition and the
incurrence of all financings contemplated herein;
(ii) environmental assessments from facilities to be acquired by
the Borrower in the Acquisition, the results of which shall be in form and
substance reasonably satisfactory to the Agent and the Required Banks; and
(iii) evidence of insurance complying with the requirements of
Section 8.03 for the business and properties of the Borrower and its
Subsidiaries, in scope, form and substance reasonably satisfactory to the
Agent and the Required Banks and naming the Collateral Agent as an
additional insured and/or loss payee, and stating that such insurance
shall not be canceled or revised without 30 days prior written notice by
the insurer to the Collateral Agent.
5.20 Pro Forma Balance Sheet. (a) On the Restatement Date, the
Banks shall have received the unaudited projected pro forma consolidated balance
sheet of Holdings both immediately before and immediately after giving effect to
the Acquisition and the incurrence of all Indebtedness (including the Revolving
Loans) contemplated herein, which projected pro forma consolidated balance sheet
shall be (i) based upon the projected balance sheet as of February 28, 1998
prepared on a basis consistent with the Projections and the financial statements
delivered pursuant to Section 7.05(a) except as specifically set forth in the
notes to such balance sheets, and (ii) in form and substance reasonably
satisfactory to the Agent and the Required Banks.
(b) On or prior to the Restatement Date, the Banks shall have
received the financial statements referred to in Section 7.05(a) and the
Projections described in Section 7.05(d), which projections shall be in form and
substance reasonably satisfactory to the Agent and the Required Banks.
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5.21 Officer's Certificate. On the Restatement Date, the Agent
shall have received a certificate dated such date signed by an Authorized
Officer of the Borrower stating that all of the applicable conditions set forth
in Sections 5.07, 5.08, 5.09, 5.10, 5.17, 5.18 and 6.01 exist as of such date.
In the event that all of the foregoing conditions precedent have
not been satisfied or waived on or before April 30, 1998, this Agreement (other
than the required payment of certain fees as separately agreed to between
Borrower and Agent) shall be of no further force and effect and the Existing
Atrium Credit Agreement shall continue in full force and effect.
SECTION 6. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The
obligation of each Bank to make Loans (including Loans made on the Restatement
Date), and the obligation of the Issuing Bank to issue any Letter of Credit
(including Letters of Credit issued on the Restatement Date), is subject, at
the time of each such Credit Event (except as hereinafter indicated), to the
satisfaction of the following conditions:
6.01 No Default; Representations and Warranties. At the time of
each such Credit Event and also after giving effect thereto (i) there shall
exist no Default or Event of Default and (ii) all representations and warranties
contained herein or in any other Credit Document shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of the making of such Credit Event (it
being understood and agreed that any representation or warranty which by its
terms is made as of a specified date shall be required to be true and correct in
all material respects only as of such specified date).
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior to
the making of each Loan, the Agent shall have received the notice required by
Section 1.03(a).
(b) Prior to the issuance of each Letter of Credit, the Agent and
the Issuing Bank shall have received a Letter of Credit Request meeting the
requirements of Section 2.02.
The acceptance of the proceeds of, and any Letter of Credit
issued with respect to, each Credit Event shall constitute a representation and
warranty by the Borrower to the Agent and each of the Banks that all the
conditions specified in Section 5 and in this Section 6 and applicable to such
Credit Event exist as of that time (except to the extent that any of the
conditions specified in Section 5 are required to be satisfactory to or
determined by any Bank, the Required Banks and/or the Agent). All of the Notes,
certificates, legal opinions and other documents and papers referred to in
Section 5 and in this Section 6, unless otherwise specified, shall be delivered
to the Agent at the Notice Office for the account of each of the Banks and,
except for the Notes, in sufficient counterparts or copies for each of the Banks
and shall be in form and substance reasonably satisfactory to the Banks.
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. In order
to induce the Banks to enter into this Agreement and to make the Loans, and
issue (or participate in) the Letters
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of Credit as provided herein, each of Holdings and the Borrower make the
following representations, warranties and agreements, in each case after giving
effect to the Transaction consummated on the Initial Borrowing Date and the
Acquisition consummated on the Restatement Date, all of which shall survive the
execution and delivery of this Agreement and the Notes and the making of the
Loans and issuance of the Letters of Credit, with the occurrence of each Credit
Event on or after the Initial Borrowing Date and on or after the Restatement
Date being deemed to constitute a representation and warranty that the matters
specified in this Section 7 are true and correct in all material respects on the
date of each such Credit Event (including the Initial Borrowing Date) (it being
understood and agreed that any representation or warranty which by its terms is
made as of a specified date shall be required to be true and correct in all
material respects only as of such specified date).
7.01 Corporate Status. Holdings and each of its Subsidiaries (i)
is a duly organized and validly existing corporation in good standing under the
laws of the jurisdiction of its incorporation, (ii) has the corporate power and
authority to own its property and assets and to transact the business in which
it is engaged and presently proposes to engage and (iii) is duly qualified and
is authorized to do business and is in good standing in each jurisdiction where
the conduct of its business requires such qualifications except for failures to
be so qualified which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
7.02 Corporate Power and Authority. Each Credit Party has the
corporate power and authority to execute, deliver and perform the terms and
provisions of each of the Documents to which it is party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents. Each Credit Party has duly executed and
delivered each of the Documents to which it is party, and each of such Documents
constitutes the legal, valid and binding obligation of such Credit Party
enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).
7.03 No Violation. Neither the execution, delivery or performance
by any Credit Party of the Documents to which it is a party, nor compliance by
it with the terms and provisions thereof, (i) will contravene any provision of
any applicable law, statute, rule or regulation or any applicable order, writ,
injunction or decree of any court or governmental instrumentality, (ii) will
conflict with or result in any breach of any of the terms, covenants, conditions
or provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien (except pursuant
to the Security Documents) upon any of the material properties or assets of
Holdings or any of its Subsidiaries pursuant to the terms of any indenture,
mortgage, deed of trust, credit agreement or loan agreement, or any other
material agreement, contract or instrument, to which Holdings or any of its
Subsidiaries is a party or by which it or any of its property or assets is bound
or to which it may be subject or (iii) will violate any provision of the
Certificate of Incorporation or By-Laws of Holdings or any of its Subsidiaries.
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7.04 Governmental Approvals. No order, consent, approval,
license, authorization or validation of, or filing, recording or registration
with (except as have been obtained or made prior to the Restatement Date (as
applicable)), or exemption by, any governmental or public body or authority, or
any subdivision thereof, is required to authorize, or is required in connection
with, (i) the execution, delivery and performance in all material respects of
any Document or (ii) the legality, validity, binding effect or enforceability of
any such Document.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; Etc. (a) (i) The audited consolidated balance sheets
of the Borrower and its Subsidiaries as of December 31, 1994, 1995 and 1996, and
the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as
of December 31, 1997, and the related consolidated statements of income and cash
flow and changes in shareholders' equity of the Borrower and its Subsidiaries,
and the notes thereto for the fiscal years ended on such dates and (ii) the
audited consolidated balance sheets of Masterview Window and its Subsidiaries as
of December 31, 1996 and 1997, and the related consolidated statements of income
and cash flow for the two month period ended December 31, 1996 and the twelve
month period ended December 31, 1997, in each case furnished to the Banks prior
to the Restatement Date, present fairly the financial condition of Holdings and
its Subsidiaries and Masterview Window and its Subsidiaries, as the case may be,
at the date of such statements of financial condition and the results of the
operations of Holdings and its Subsidiaries and Masterview Window and its
Subsidiaries, as the case may be, for the respective Fiscal Year or other
period, as the case may be, described therein (subject, in the case of unaudited
financial statements, to ordinary year-end adjustments). All such financial
statements have been prepared in accordance with GAAP consistently applied, and
present fairly the information purported to be presented therein as of such
dates and for the periods then ended. After giving effect to the Transaction and
the Acquisition, since December 31, 1995, there have been no circumstances or
events the result of which has had a Material Adverse Effect.
(b) On and as of the Restatement Date, after giving effect to the
Acquisition and to all Indebtedness (including the Loans) being incurred or
assumed and Liens created by Holdings and its Subsidiaries in connection
therewith (assuming the full utilization of all Commitments on the Restatement
Date), (i) the sum of the assets, at a fair valuation, of each of the Borrower,
individually, and Holdings and its Subsidiaries taken as a whole, will exceed
its or their debts; (ii) each of the Borrower, individually, and Holdings and
its Subsidiaries taken as a whole, have not incurred and do not intend to incur,
and do not believe that it or they will incur, debts beyond its or their ability
to pay such debts as such debts mature; and (iii) each of the Borrower,
individually, and Holdings and its Subsidiaries taken as a whole, will have
sufficient capital with which to conduct its or their businesses. For purposes
of this Section 7.05(b), "debt" means any liability on a claim, and "claim"
means (A) right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured, or unsecured or (B) right to an equitable
remedy for breach of performance if such breach gives rise to a payment, whether
or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured or unsecured.
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(c) Except as fully disclosed in the financial statements
delivered pursuant to Section 7.05(a), there were as of the Restatement Date no
liabilities or obligations with respect to Holdings or any of its Subsidiaries
of any nature whatsoever (whether absolute, accrued, contingent or other wise
and whether or not due) which, either individually or in aggregate, would have a
Material Adverse Effect. As of the Restatement Date, neither Holdings nor the
Borrower knows of any basis for the assertion against it of any liability or
obligation of any nature whatsoever that is not fully disclosed in the financial
statements delivered pursuant to Section 7.05(a) which, either individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
(d) On and as of the Restatement Date, the financial projections
(the "Projections") previously delivered to the Agent and the Banks have been
prepared on a basis consistent with the financial statements referred to in
Section 7.05(a) (other than as set forth or presented in such Projections), and
there are no statements or conclusions in any of the Projections which are based
upon or include information known to the Borrower to be misleading in any
material respect or which fail to take into account material information
regarding the matters reported therein. On the Restatement Date, the Borrower
believed that the Projections were reasonable and attainable.
7.06 Litigation. There are no actions, suits or proceedings
pending or, to the best knowledge of Holdings and the Borrower, threatened, with
respect to Holdings or any of its Subsidiaries (i) that are likely to have a
Material Adverse Effect or (ii) that could reasonably be expected to have a
material adverse effect on the rights or remedies of the Banks or on the ability
of any Credit Party to perform its respective obligations to the Banks hereunder
and under the other Credit Documents to which it is, or will be, a party.
Additionally, there does not exist any judgment, order or injunction applicable
to the Borrower prohibiting or imposing material adverse conditions upon the
occurrence of any Credit Event.
7.07 True and Complete Disclosure. All factual information (taken
as a whole) furnished by or on behalf of Holdings or any of its Subsidiaries in
writing to the Agent or any Bank (including, without limitation, all information
contained in the Documents, but excluding the Projections as to which Section
7.05(d) applies) for purposes of or in connection with this Agreement, the other
Credit Documents or any transaction contemplated herein or therein is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of such Persons in writing to the Agent or any Bank will be, true and
accurate in all material respects on the date as of which such information is
dated or certified and not incomplete by omitting to state any fact necessary to
make such information (taken as a whole) not misleading in any material respect
at such time in light of the circumstances under which such information was
provided.
7.08 Use of Proceeds; Margin Regulations. (a) Up to $3,600,000 of
the proceeds of Revolving Loans incurred on the Initial Borrowing Date shall be
used by the Borrower (i) to effect the Transaction and (ii) to pay fees and
expenses related to the Transaction.
(b) All of the proceeds of the Term Loans and up to $10,000,000
of the proceeds of Revolving Loans incurred on the Restatement Date shall be
used by the Borrower to finance
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the Acquisition and to pay fees and expenses incurred in connection with the
Acquisition.
(c) All proceeds of all Revolving Loans shall be used for the
Borrower's and its Subsidiaries' general corporate and working capital purposes
(excluding the purposes described in preceding clauses (a) and (b)).
(d) No part of the proceeds of any Loan will be used to purchase
or carry any Margin Stock or to extend credit for the purpose of purchasing or
carrying any Margin Stock. Neither the making of any Loan nor the use of the
proceeds thereof nor the occurrence of any other Credit Event will violate or be
inconsistent with the provisions of Regulation G, T, U or X.
7.09 Tax Returns and Payments. Holdings and each of its
Subsidiaries have timely filed or caused to be timely filed, on the due dates
thereof or within applicable grace periods, with the appropriate taxing
authority, all Federal and all material state and other returns, statements,
forms and reports for taxes (the "Returns") required to be filed by or with
respect to the income, properties or operations of Holdings and/or any of its
Subsidiaries. The Returns accurately reflect in all material respects all
liability for taxes of Holdings and its Subsidiaries for the periods covered
thereby. Holdings and each of its Subsidiaries have paid all material taxes
payable by them other than taxes which are not delinquent, and other than those
contested in good faith and for which adequate reserves have been established in
accordance with generally accepted accounting principles. Except as disclosed in
the financial statements referred to in Section 7.05(a), there is no material
action, suit, proceeding, investigation, audit, or claim now pending or, to the
best knowledge of Holdings and the Borrower, threatened by any authority
regarding any taxes relating to Holdings or any of its Subsidiaries. As of the
Restatement Date, neither Holdings nor any of its Subsidiaries has entered into
an agreement or waiver or been requested to enter into an agreement or waiver
extending any statute of limitations relating to the payment or collection of
taxes of Holdings or any of its Subsidiaries, or is aware of any circumstances
that would cause the taxable years or other taxable periods of Holdings or any
of its Subsidiaries not to be subject to the normally applicable statute of
limitations. Neither Holdings nor any of its Subsidiaries has incurred, or will
incur, any material tax liability in connection with the consummation of the
Transaction, the Acquisition and the other transactions contemplated hereby.
7.10 Compliance with ERISA. Each Plan (other than a multiemployer
plan (as defined in Section 4001(a)(3) of ERISA)) is in substantial compliance
with ERISA and the Code; no Reportable Event has occurred with respect to a Plan
(other than a multiemployer plan (as defined in Section 4001(a)(3) of ERISA));
no Plan is insolvent or in reorganization; no Plan other than a multiemployer
plan (as defined in Section 4001(a)(3) of ERISA) has an Unfunded Current
Liability; no Plan has an accumulated or waived funding deficiency, or has
applied for an extension of any amortization period within the meaning of
Section 412 of the Code; all contributions required to be made by Holdings, any
of its Subsidiaries or any ERISA Affiliate with respect to a Plan have been
timely made; none of Holdings or any of its Subsidiaries nor any ERISA Affiliate
has incurred any material liability to or on account of a Plan pursuant to
Section 409, 502(i), 502(1), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 401(a)(29), 4971, 4975 or 4980 of the Code
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or reasonably expects to incur any material liability under any of the foregoing
Sections with respect to any Plan; no proceedings have been instituted to
terminate or appoint a trustee to administer any Plan; no condition exists which
presents a material risk to Holdings or any of its Subsidiaries or any ERISA
Affiliate of incurring a material liability to or on account of a Plan pursuant
to the foregoing provisions of ERISA and the Code; using actuarial assumptions
and computation methods consistent with Part 1 of subtitle E of Title IV of
ERISA, the annual aggregate liability of Holdings, its Subsidiaries and their
ERISA Affiliates to all Plans which are multiemployer plans (as defined in
Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as
of the close of the most recent fiscal year of each such Plan ended prior to the
date of the most recent Credit Event, would not increase by more than $2,000,000
over the average amount contributed to such Plans during the five years
preceding the most recent Credit Event by Holdings, its Subsidiaries and their
ERISA Affiliates; no lien imposed under the Code or ERISA on the assets of
Holdings or any of its Subsidiaries or any ERISA Affiliate exists or is likely
to arise on account of any Plan; and Holdings and its Subsidiaries do not
maintain or contribute to any employee welfare benefit plan (as defined in
Section 3(1) of ERISA) which provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or any
employee pension benefit plan (as defined in Section 3(2) of ERISA) the
obligations with respect to which could reasonably be expected to have a
material adverse effect on the ability of any Credit Party to perform its
obligations under the Credit Documents to which they are a party.
7.11 Security Documents. (a) The provisions of the Security
Agreement are effective to create in favor of the Collateral Agent for the
benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of the Credit Parties in the Security
Agreement Collateral described therein, and the Security Agreement, upon the
filing of Form UCC-1 financing statements or the appropriate equivalent, creates
a fully perfected first lien on, and security interest in, all right, title and
interest in all of the Security Agreement Collateral described therein, subject
to no other Liens other than Permitted Liens. The recordation of the Assignment
of Security Interest in U.S. Patents and Trademarks in the form attached to the
Security Agreement in the United States Patent and Trademark Office together
with filings on Form UCC-1 made pursuant to the Security Agreement will be
effective, under applicable law, to perfect the security interest granted to the
Collateral Agent in the trademarks and patents covered by the Security Agreement
and the recordation of the Assignment of Security Interest in U.S. Copyrights in
the form attached to the Security Agreement with the United States Copyright
Office together with filings on Form UCC-1 made pursuant to the Security
Agreement will be effective under federal law to perfect the security interest
granted to the Collateral Agent in the copyrights covered by the Security
Agreement. Each of the Credit Parties party to the Security Agreement has good
and valid title to all Security Agreement Collateral described therein, free
and clear of all Liens except those described above in this clause (a).
(b) The security interests created in favor of the Collateral
Agent, as pledgee, for the benefit of the Secured Creditors under the Pledge
Agreement constitute first priority perfected security interests in the Pledged
Securities described in the Pledge Agreement, subject to no security interests
of any other Person. No filings or recordings are required in order to perfect
(or maintain
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the perfection or priority of) the security interests created in the Pledged
Securities and the proceeds thereof under the Pledge Agreement.
(c) After the recording thereof as required by Section 5.11, the
Mortgages (and the amendments thereto) shall create, as security for the
obligations purported to be secured thereby, a valid and enforceable perfected
security interest in and mortgage lien on the Mortgaged Properties in favor of
the Collateral Agent (or such other trustee as may be required or desired under
local law) for the benefit of the Secured Creditors, superior to and prior to
the rights of all third persons (except that the security interest and mortgage
lien created in the Mortgaged Properties may be subject to the Permitted
Encumbrances and the Permitted Liens described in Section 9.01(ix) related
thereto) and subject to no other Liens (other than Permitted Liens). Schedule
III hereto contains a true and complete list of each parcel of Real Property
owned or leased by the Borrower and its Subsidiaries on the Restatement Date,
and the type of interest therein held by the Borrower or such Subsidiary. The
Borrower and each of its Subsidiaries have good and indefeasible title to all
fee-owned Real Property and valid leasehold title to all Leaseholds, in each
case free and clear of all Liens except those described in the first sentence of
this subsection (c).
7.12 Representations and Warranties in Documents. All
representations and warranties by Holdings and, to the knowledge of Holdings and
the Borrower, any other party thereto, set forth in the Documents (other than
the Credit Documents) were true and correct in all material respects at the time
as of which such representations and warranties were made and shall be true and
correct in all material respects as to the Restatement Date as if such
representations and warranties were made on and as of such date, unless stated
to relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date, in each case except to the extent that the failure of any such
representation and warranty to be true and correct in all material respects,
either individually or in the aggregate with other such representations and
warranties, is not reasonably likely to have a Material Adverse Effect.
7.13 Properties. Holdings and each of its Subsidiaries have good
and valid title to all properties owned by them, including all property
reflected in the balance sheets of the Borrower and its Subsidiaries referred to
in Section 7.05(a) and in the pro forma balance sheet referred to in Section
5.16(a) (except as sold or otherwise disposed of since the date of such balance
sheet in the ordinary course of business or in accordance with the terms of this
Agreement), free and clear of all Liens, other than Permitted Liens.
7.14 Capitalization. (a) On the Restatement Date and after giving
effect to the Acquisition and the other transactions contemplated hereby, the
authorized capital stock of Holdings shall consist of (i) 100,000,000 shares of
Holdings Common Stock, $0.01 par value per share, of which 38,796,428 shares
shall be issued and outstanding and (ii) 20,000,000 shares of preferred stock of
Holdings, $0.01 par value per share, of which no shares shall be issued and
outstanding. All such outstanding shares have been duly and validly issued, are
fully paid and non-assessable and have been issued free of preemptive rights. As
of the Restatement Date and after giving effect to the
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Transaction, the Acquisition and the other transactions contemplated hereby,
Holdings does not have outstanding any securities convertible into or
exchangeable for its capital stock.
(b) On the Restatement Date and after giving effect to the
Acquisition and the other transactions contemplated hereby, the authorized
capital stock of the Borrower shall consist of 3,000 shares of common stock,
$0.01 par value per share, of which 100 shares shall be issued and outstanding,
owned by Holdings, and delivered for pledge pursuant to the Pledge Agreement.
All such outstanding shares of common stock have been duly and validly issued,
are fully paid and nonassessable and are free of preemptive rights. As of the
Restatement Date, the Borrower does not have outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock.
7.15 Subsidiaries. On the Restatement Date, after the
consummation of the Acquisition, Holdings has no Subsidiaries other than the
Borrower and its Subsidiaries, and the Borrower has no Subsidiaries other than
those Subsidiaries listed on Schedule IV attached hereto. Schedule IV correctly
sets forth, as of the Restatement Date and after giving effect to the
Acquisition, the percentage ownership (direct or indirect) of Holdings in each
class of capital stock of each of its Subsidiaries and also identifies the
direct owner thereof. All outstanding shares of capital stock of each Subsidiary
of the Borrower have been duly and validly issued, are fully paid and
nonassessable and have been issued free of preemptive rights. No Subsidiary of
the Borrower has outstanding any securities convertible into or exchangeable for
its capital stock or outstanding any right to subscribe for or to purchase, or
any options or warrants for the purchase of, or any agreement providing for the
issuance (contingent or otherwise) of or any calls, commitments or claims of any
character relating to, its capital stock or any stock appreciation or similar
rights.
7.16 Compliance with Statutes; Etc. Except for matters relating
to the compliance by Holdings and its Subsidiaries with Environmental Laws,
which matters are governed by the Environmental Indemnity Agreement, Holdings
and each of its Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable statutes,
regulations, orders and restrictions relating to environmental standards and
controls), except such noncompliances as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
7.17 Investment Company Act. Neither Holdings nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
7.18 Public Utility Holding Company Act. Neither Holdings nor any
of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate"
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of a "holding company" or of a "subsidiary company" of a "holding company"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended.
7.19 Labor Relations. Neither Holdings nor any of its
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect. There is (i) no unfair labor
practice complaint pending against Holdings or any of its Subsidiaries or, to
the best knowledge of Holdings and the Borrower, threatened against any of them,
before the National Labor Relations Board, and no material grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement is so pending against Holdings or any of its Subsidiaries or, to the
best knowledge of Holdings and the Borrower, threatened against any of them,
(ii) no strike, labor dispute, slowdown or stoppage pending against Holdings or
any of its Subsidiaries or, to the best knowledge of Holdings and the Borrower,
threatened against Holdings or any of its Subsidiaries and (iii) to the best
knowledge of Holdings and the Borrower, no union representation proceeding is
pending with respect to the employees of Holdings or any of its Subsidiaries,
except (with respect to any matter specified in clause (i), (ii) or (iii) above,
either individually or in the aggregate) such as is not likely to have a
Material Adverse Effect.
7.20 Patents, Licenses, Franchises and Formulas. Holdings and
each of its Subsidiaries owns all material patents, trademarks, permits,
service marks, trade names, copyrights, licenses, franchises and formulas, or
rights with respect to the foregoing, and has obtained assignments of all leases
and other rights of whatever nature, reasonably necessary for the present
conduct of its business, without any known conflict with the rights of others
which, or the failure to obtain which, as the case may be, would result in a
Material Adverse Effect.
7.21 Indebtedness. Schedule V attached hereto sets forth a true
and complete list of all Indebtedness for borrowed money of Holdings and its
Subsidiaries as of the Restatement Date and which is to remain outstanding after
giving effect to the Acquisition and the transactions contemplated hereby
(excluding the Indebtedness hereunder) (the "Existing Indebtedness"), in each
case showing the aggregate principal amount thereof and the name of the
respective borrower and any other entity which directly or indirectly guaranteed
such debt, all of which shall be evidenced by the Existing Debt Agreements.
7.22 Recapitalization. At the time of consummation thereof, the
Recapitalization shall have been consummated in all material respects in
accordance with the terms of the respective Recapitalization Documents and all
applicable laws. At the time of consummation of the Recapitalization, all
consents and approvals of, and filings and registrations with, and all other
actions in respect of, all governmental agencies, authorities or
instrumentalities required in order to make or consummate the Recapitalization
will have been obtained, given, filed or taken and are or will be in full force
and effect. All applicable waiting periods with respect thereto have or, prior
to the time when required, will have, expired without, in all such cases, any
action being taken by any competent authority which restrains, prevents, or
imposes material adverse conditions upon the Recapitalization. Additionally,
there does not exist any judgment, order or injunction prohibiting or imposing
material adverse conditions upon the Recapitalization, or the occurrence of any
Credit
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Event or the performance by any Credit Party of its obligations under the
respective Documents. All actions taken by Holdings and its Subsidiaries
pursuant to or in furtherance of the Recapitalization have been taken, or will
be taken substantially contemporaneously with the funding of initial Revolving
Loans on the Initial Borrowing Date, in compliance with the Recapitalization
Documents and all applicable laws.
7.23 Acquisition. At the time of consummation thereof, the
Acquisition shall have been consummated in all material respects in accordance
with the terms of the respective Acquisition Documents and all applicable laws.
At the time of consummation of the Acquisition, all consents and approvals of,
and filings and registrations with, and all other actions in respect of, all
govern mental agencies, authorities or instrumentalities required in order to
make or consummate the Acquisition will have been obtained, given, filed or
taken and are or will be in full force and effect. All applicable waiting
periods with respect thereto have or, prior to the time when required, will
have, expired without, in all such cases, any action being taken by any
competent authority which restrains, prevents, or imposes material adverse
conditions upon the Acquisition. Additionally, there does not exist any
judgment, order or injunction prohibiting or imposing material adverse
conditions upon the Acquisition, or the occurrence of any Credit Event or the
performance by any Credit Party of its obligations under the respective
Documents. All actions taken by Holdings and its Subsidiaries pursuant to or in
furtherance of the Acquisition have been taken, or will be taken substantially
contemporaneously with the funding of the Term Loans on the Restatement Date, in
compliance with the Acquisition Documents and all applicable laws.
7.24 Special Purpose Corporation. Holdings engages in no business
activities and has no significant assets or liabilities (other than under this
Agreement, the other Credit Documents and the Recapitalization Documents).
7.25 Subordination. The subordination provisions contained in the
Senior Subordinated Note Documents are enforceable against the Borrower and the
holders thereof, and all Obligations shall be within the definition of "Senior
Debt" included in such subordination provisions.
SECTION 8. AFFIRMATIVE COVENANTS. Holdings and the Borrower
hereby covenant and agree that on and after the Restatement Date and until the
Total Commitments and all Letters of Credit have terminated and the Loans, Notes
and Unpaid Drawings, together with interest, Fees and all other obligations
incurred hereunder and thereunder, are paid in full:
8.01 Information Covenants. Holdings and/or the Borrower will
furnish to each Bank:
(a) Monthly Reports. Within 30 days (45 days with respect to the
first six fiscal months after the date hereof) after the end of each
fiscal month of the Borrower (other than the fiscal months of March, June,
September and December) and within 45 days after the end of the fiscal
months of March, June, September and December, (i) the consolidated
balance sheets of the Borrower and its Subsidiaries as at the end of such
month and the related consolidated
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statements of income and retained earnings and statement of cash flows for
such month and for the elapsed portion of the Fiscal Year ended with the
last day of such month, in each case setting forth comparative figures for
the corresponding month in the prior Fiscal Year and the budgeted figures
for such month as set forth in the respective budget delivered pursuant to
Section 8.01(d) and (ii) management's discussion and analysis of the
important operational and financial developments during the month and
year-to-date periods.
(b) Annual Financial Statements. Within 90 days after the close
of each Fiscal Year, the consolidated balance sheets of the Borrower and
its Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income and retained earnings and statement of
cash flows for such Fiscal Year setting forth comparative figures for the
preceding Fiscal Year and certified by Arthur Andersen LLP or such other
independent certified public accountants of recognized national standing
reasonably acceptable to the Agent, together with a report of such
accounting firm stating that in the course of its regular audit of the
financial statements of Holdings and its Subsidiaries, which audit was
conducted in accordance with generally accepted auditing standards, such
accounting firm obtained no knowledge of any Default or Event of Default
which has occurred and is continuing under Sections 9.04, 9.05 or 9.07
through 9.10 inclusive or, if in the opinion of such accounting firm such
a Default or an Event of Default with respect to the covenants set forth
in Sections 9.04, 9.05, or 9.07 through 9.10, inclusive has occurred and
is continuing, a statement as to the nature thereof.
(c) Management Letters. Promptly after the receipt thereof, a
copy of any final "management letter" received by Holdings or any of its
Subsidiaries from its certified public accountants and the management's
responses thereto.
(d) Budgets. No later than 45 days following the commencement of
the first day of each Fiscal Year, a budget in form reasonably
satisfactory to the Agent (including budgeted statements of income and
cash flow and balance sheets) prepared by the Borrower for each of the
twelve months of such Fiscal Year prepared in detail of the Borrower and
its Subsidiaries, accompanied by the statement of an Authorized Officer of
the Borrower to the effect that, to the best of his or her knowledge, the
budget is a reasonable estimate for the period covered thereby.
(e) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.01(a) and (b), a
certificate of an Authorized Officer of the Borrower to the effect that,
to the best of such officer's knowledge, no Default or Event of Default
has occurred and is continuing or, if any Default or Event of Default has
occurred and is continuing, specifying the nature and extent thereof,
which certificate shall, in the case of any such financial statements
delivered in respect of a period ending on the last day of a fiscal
quarter or year of Holdings, set forth the calculations required to
establish whether the Borrower was in compliance with the provisions of
Sections 4.02(d), 9.03, 9.04, 9.05 and 9.07 through 9.10, inclusive, at
the end of such fiscal quarter or year, as the case may be.
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(f) Notice of Default or Litigation. Promptly, and in any event
within three Business Days after an officer of Holdings or any of its
Subsidiaries obtains knowledge thereof, notice of (i) the occurrence of
any event which constitutes a Default or an Event of Default and (ii) any
litigation or governmental investigation or proceeding pending (A) against
Holdings or any of its Subsidiaries which could reasonably be expected to
have a Material Adverse Effect, (B) with respect to any material
Indebtedness of the Borrower and its Subsidiaries taken as a whole or (C)
with respect to any Document.
(g) Other Reports and Filings. Promptly, copies of all financial
information, proxy materials and other information and reports, if any,
which Holdings or any of its Subsidiaries shall file with the Securities
and Exchange Commission or any successor thereto (the "SEC") or deliver to
holders of its Indebtedness pursuant to the terms of the documentation
governing such Indebtedness (or any trustee, agent or other representative
therefor).
(h) Annual Meetings with Banks. At the request of Agent, Holdings
shall within 120 days after the close of each Fiscal Year hold a meeting
at a time and place selected by Holdings and acceptable to the Agent with
all of the Banks at which meeting shall be reviewed the financial results
of the previous Fiscal Year and the financial condition of Holdings and
its Subsidiaries and the budgets presented for the current Fiscal Year.
(i) Other Information. From time to time, such other information
or documents (financial or otherwise) with respect to Holdings or its
Subsidiaries as any Bank may reasonably request in writing.
8.02 Books, Records and Inspections. Holdings will, and will
cause each of its Subsidiaries to, keep proper books of record and account in
which full, true and correct entries in conformity with generally accepted
accounting principles and all requirements of law shall be made of all dealings
and transactions in relation to its business and activities. Holdings will, and
will cause each of its Subsidiaries to, permit officers and designated
representatives of the Agent or any Bank to visit and inspect, during regular
business hours and under guidance of officers of Holdings or such Subsidiary,
any of the properties of Holdings or such Subsidiary, and to examine the books
of account of Holdings or such Subsidiary and discuss the affairs, finances and
accounts of Holdings or such Subsidiary with, and be advised as to the same by,
its and their officers and independent accountants, all at such reasonable times
and intervals and to such reasonable extent as the Agent or such Bank may
request.
8.03 Maintenance of Property; Insurance. (a) Schedule VI attached
hereto sets forth a true and complete listing of all insurance maintained by
Holdings and its Subsidiaries as of the Restatement Date. Holdings will, and
will cause each of its Subsidiaries to, (i) keep all property
necessary in its business in good working order and condition (ordinary wear and
tear excepted), (ii) maintain insurance on all its property in at least such
amounts and against at least such risks as is consistent and in accordance with
industry practice and (iii) furnish to each Bank, upon written request, full
information as to the insurance carried. In addition to the requirements of the
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immediately preceding sentence, Holdings will at all times cause insurance of
the types described in Schedule VI to be maintained (with the same scope of
coverage as that described in Schedule VI) at levels which are at least as great
as the respective amount described opposite the respective type of insurance on
Schedule VI or otherwise as are acceptable to the Agent. Holdings will furnish
to the Agent on the Restatement Date and on each date on which financial
statements are delivered pursuant to Section 8.01(b) a summary of the insurance
carried in respect of Holdings and its Subsidiaries and the assets of Holdings
and its Subsidiaries.
(b) Holdings will, and will cause its Subsidiaries to, at all
times keep their respective property insured in favor of the Collateral Agent,
and all policies (including Mortgage Policies) or certificates (or certified
copies thereof) with respect to such insurance (and any other insurance
maintained by Holdings or any of its Subsidiaries) (i) shall be endorsed to the
Collateral Agent's satisfaction for the benefit of the Collateral Agent
(including, without limitation, by naming the Collateral Agent as loss payee or
as an additional insured), (ii) shall state that such insurance policies shall
not be canceled without 30 days' prior written notice thereof by the respective
insurer to the Collateral Agent, (iii) shall provide that the respective
insurers irrevocably waive any and all rights of subrogation with respect to the
Collateral Agent and the Secured Creditors, (iv) shall contain the standard
non-contributory mortgagee clause endorsement in favor of the Collateral Agent
with respect to hazard insurance coverage, (v) shall, except in the case of
public liability insurance and workers' compensation insurance, provide that any
losses shall be payable notwithstanding (A) any act or neglect of Holdings or
any of its Subsidiaries, (B) the occupation or use of the properties for
purposes more hazardous than those permitted by the terms of the respective
policy if such coverage is obtainable at commercially reasonable rates and is of
the kind from time to time customarily insured against by Persons owning or
using similar property and in such amounts as are customary, (C) any foreclosure
or other proceeding relating to the insured properties if such coverage is
available at commercially reasonable rates or (D) any change in the title to or
ownership or possession of the insured properties and (vi) shall be deposited
with the Collateral Agent if such coverage is available at commercially
reasonable rates.
(c) If Holdings or any of its Subsidiaries shall fail to maintain
all insurance in accordance with this Section 8.03, or if Holdings or any of its
Subsidiaries shall fail to so endorse and deposit all policies or certificates
with respect thereto, the Agent and/or the Collateral Agent shall have the right
(but shall be under no obligation) to procure such insurance and the Borrower
agrees to reimburse the Agent or the Collateral Agent as the case may be, for
all costs and expenses of procuring such insurance.
8.04 Corporate Franchises. Holdings will, and will cause each of
its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force and effect its existence and its material rights,
franchises, licenses and patents; provided, however, that nothing in this
Section 8.04 shall prevent (i) sales of assets by Holdings or any of its
Subsidiaries in accordance with Section 9.02, (ii) the withdrawal by Holdings or
any of its Subsidiaries of their qualification as a foreign corporation in any
jurisdiction where such withdrawal could not reasonably be expected to
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have a Material Adverse Effect or (iii) dissolutions, mergers or consolidations
of Subsidiaries in accordance with Section 9.02.
8.05 Compliance with Statutes; Etc. Except for matters relating
to compliance by Holdings and its Subsidiaries with Environmental Laws, which
matters are governed by the Environmental Indemnity Agreement, Holdings and the
Borrower will, and will cause each of their respective Subsidiaries to, comply
with all applicable statutes, regulations and orders of, and all applicable
restrictions imposed by, all governmental bodies, domestic or foreign, in
respect of the conduct of its business and the ownership of its property, except
such noncompliances as could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect or a material adverse effect on
the ability of any Credit Party to perform its obligations under any Credit
Document to which it is a party.
8.06 ERISA. As soon as possible and, in any event, within 20
days after Holdings or any of its Subsidiaries or any ERISA Affiliate knows or
has reason to know of the occurrence of any of the following, Holdings or the
Borrower will deliver to each of the Banks a certificate of an Authorized
Officer of Holdings or the Borrower setting forth details as to such occurrence
and the action, if any, that Holdings, the Borrower, such Subsidiary or such
ERISA Affiliate is required or proposes to take, together with any notices
required or proposed to be given to or filed with or by Holdings, the Borrower,
such Subsidiary, the ERISA Affiliate, the PBGC, or a Plan participant or the
Plan administrator with respect thereto: that a Reportable Event has occurred;
that an accumulated funding deficiency has been incurred or an application is
likely to be or has been made to the Secretary of the Treasury for a waiver or
modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code with respect to a Plan; that a contribution required to be made
to a Plan has not been timely made; that a Plan has been or is reasonably
expected to be terminated, reorganized, partitioned or declared insolvent under
Title IV of ERISA; that a Plan has an Unfunded Current Liability giving rise to
a lien under ERISA or the Code; that proceedings are likely to be or have been
instituted or notice has been given to terminate or appoint a trustee to
administer a Plan, that a proceeding has been instituted pursuant to Section 515
of ERISA to collect a delinquent contribution to a Plan; that Holdings, any of
its Subsidiaries or any ERISA Affiliate will or is reasonably expected to incur
any material liability (including any contingent or secondary liability) to or
on account of the termination of or withdrawal from a Plan under Section 4062,
4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under
Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(i) or
502(l) of ERISA; or that Holdings or any Subsidiary is reasonably expected to
incur any material unfunded liability pursuant to any employee welfare benefit
plan (as defined in Section 3(1) of ERISA) that provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or any employee pension benefit plan (as defined in Section 3(2) of
ERISA). Upon request, the Borrower will deliver to each of the Banks a complete
copy of the annual report (Form 5500) of each Plan required to be filed with the
Internal Revenue Service. In addition to any certificates or notices delivered
to the Banks pursuant to the first sentence hereof, copies of any material
notices received by Holdings or any of its Subsidiaries or any ERISA Affiliate
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with respect to any Plan shall be delivered to the Banks no later than 20 days
after the date such notice has been received by Holdings, such Subsidiary or the
ERISA Affiliate, as applicable.
8.07 End of Fiscal Years; Fiscal Quarters. Holdings shall cause
(i) each of its, and each of its Subsidiaries', Fiscal Years to end on December
31 of each year, and (ii) each of its, and each of its Subsidiaries', fiscal
quarters to end on March 31, June 30, September 30 and December 31 of each year.
8.08 Performance of Obligations. Holdings will, and will cause
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, indenture, security agreement and other debt instrument by which
it is bound, except such non-performances as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
8.09 Payment of Taxes. Holdings will pay and discharge or cause
to be paid and discharged, and will cause each of its Subsidiaries to pay and
discharge, all material taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits, or upon any material properties
belonging to it, in each case on a timely basis, and all lawful claims which, if
unpaid, might become a lien or charge upon any properties of Holdings or any of
its Subsidiaries; provided, however, that neither Holdings nor any of its
Subsidiaries shall be required to pay any such tax, assessment, charge, levy or
claim which is being contested in good faith and by proper proceedings if it has
maintained adequate reserves with respect thereto in accordance with GAAP.
8.10 Additional Security; Further Assurances; Surveys. (a)
Holdings will, and will cause each of its Subsidiaries to, grant to the
Collateral Agent security interests and mortgages (an "Additional Mortgage") in
such fee simple interests of Real Property of Holdings or any of its
Subsidiaries as are not covered by the original Mortgages, to the extent
acquired after the Restatement Date, and as may be reasonably requested from
time to time by the Agent or the Required Banks (each such Real Property, an
"Additional Mortgaged Property"). All such Additional Mortgages shall be granted
pursuant to documentation substantially in the form of the Mortgages delivered
to the Agent on the Restatement Date or in such other form as is reasonably
satisfactory to the Agent and shall constitute valid and enforceable perfected
Liens superior to and prior to the rights of all third Persons and subject to no
other Liens except as are permitted by Section 9.01 at the time of perfection
thereof. The Additional Mortgages or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Additional Mortgages and all taxes,
fees and other charges payable in connection therewith shall have been paid in
full.
(b) Holdings will, and will cause each of its Subsidiaries to, at
the expense of the Borrower, make, execute, endorse, acknowledge, file and/ or
deliver to the Collateral Agent from time to time such vouchers, invoices,
schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, real
property surveys, reports and other assurances or instruments and take such
further steps relating to the Collateral covered by any
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of the Security Documents as the Collateral Agent may reasonably require
pursuant to this Section 8.10. Furthermore, Holdings and the Borrower shall
cause to be delivered to the Collateral Agent such opinions of counsel, title
insurance and other related documents as may be requested by the Collateral
Agent to assure itself that this Section 8.10 has been complied with.
(c) The security interests required to be granted pursuant to
this Section 8.10 shall be granted pursuant to security documentation (which
shall be substantially similar to the Security Documents already executed and
delivered by the Holdings and its Subsidiaries, as applicable) or otherwise
satisfactory in form and substance to the Agent and shall constitute valid and
enforceable perfected security interests prior to the rights of all third
Persons and subject to no other Liens except such Liens as are permitted by
Section 9.01. The Additional Security Documents and other instruments related
thereto shall be duly recorded or filed in such manner and in such places and at
such times as are required by law to establish, perfect, preserve and protect
the Liens, in favor of the Collateral Agent for the benefit of the respective
Secured Creditors, required to be granted pursuant to the Additional Security
Documents and all taxes, fees and other charges payable in connection therewith
shall be paid in full by the Borrower. At the time of the execution and delivery
of the Additional Security Documents, the Borrower shall cause to be delivered
to the Collateral Agent such opinions of counsel, Mortgage Policies, title
surveys, real estate appraisals and other related documents as may be reasonably
requested by the Agent or the Required Banks to assure themselves that this
Section 8.10 has been complied with.
(d) In the event that the Agent or the Required Banks at any time
after the Restatement Date determine in its or their good faith discretion that
real estate appraisals satisfying the requirements of FIRREA (any such appraisal
a "Required Appraisal") are or were required to be obtained, or should be
obtained, in connection with the Mortgaged Properties, then, within 120 days
after receiving written notice thereof from the Agent or the Required Banks, as
the case may be, such Required Appraisal shall be delivered, at the expense of
the Borrower, to the Agent which Required Appraisal, and the respective
appraiser, shall be satisfactory to the Agent.
(e) Each of Holdings and the Borrower agrees that each action
required above by Section 8.10(a) or (b) shall be completed as soon as possible,
but in no event later than 60 days after such action is requested to be taken by
the Agent or the Required Banks.
8.11 Ownership of Subsidiaries. Holdings shall at all times own
100% of the outstanding capital stock of the Borrower and the Borrower shall
directly or indirectly own 100% of the capital stock of each of its Subsidiaries
(except as otherwise described on Schedule IV hereto as in effect on the
Restatement Date and except as may be created after the Restatement Date in
accordance with Section 9.15).
8.12 Maintenance of Corporate Separateness. Holdings will, and
will cause each of its Subsidiaries to, satisfy customary corporate formalities,
including the maintenance of corporate records. Neither the Borrower nor any
Subsidiary of the Borrower shall make any payment to a creditor of Holdings
(other than a Guaranteed Creditor pursuant to any Credit Document, Tax
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Sharing Agreement or an Interest Rate Protection Agreement or Other Hedging
Agreement entered into with any such Guaranteed Creditor) in respect of any
liability of Holdings, and no bank account of Holdings shall be commingled with
any bank account of the Borrower or any Subsidiary of the Borrower. Any
financial statements distributed to any creditors of Holdings shall, to the
extent permitted by GAAP, clearly establish the corporate separateness of
Holdings from the Borrower and each of the Borrower's Subsidiaries. Finally,
neither the Borrower nor any of its Subsidiaries shall take any action, or
conduct its affairs in a manner, which is likely to result in the corporate
existence of Holdings on the one hand and of the Borrower or any Subsidiary of
the Borrower on the other hand being ignored, or in the assets and liabilities
of the Borrower or any Subsidiary of the Borrower being substantively
consolidated with those of Holdings in a bankruptcy, reorganization or other
insolvency proceeding.
8.13 Repayment of SBA Loan. The Borrower shall cause the SBA Loan
to be repaid in full and all Liens securing the same to be released on or prior
to January 31, 1997.
8.14 Dissolution of Masterview California. The Borrower shall, on
or prior to April 15, 1998, cause Masterview California to be dissolved and all
of its assets and properties to be distributed to the Borrower or to a
Wholly-Owned Subsidiary of the Borrower.
SECTION 9. NEGATIVE COVENANTS. Holdings and the Borrower covenant
and agree that on and after the Restatement Date and until the Total Commitments
and all Letters of Credit have terminated and the Loans, Notes and Unpaid
Drawings, together with interest, Fees and all other Obligations incurred
hereunder and thereunder, are paid in full:
9.01 Liens. Holdings will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
Holdings or any of its Subsidiaries, whether now owned or here after acquired,
or sell any such property or assets subject to an understanding or agreement,
contingent or otherwise, to repurchase such property or assets (including sales
of accounts receivable with recourse to Holdings or any of its Subsidiaries), or
assign any right to receive income or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute; provided, however, that the provisions of this
Section 9.01 shall not prevent the creation, incurrence, assumption or existence
of the following (Liens described below are herein referred to as "Permitted
Liens"):
(i) inchoate Liens for taxes, assessments or governmental charges
or levies not yet due and payable or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and by
appropriate proceedings for which adequate reserves have been established
in accordance with GAAP;
(ii) Liens in respect of property or assets of the Borrower or
any of its Subsidiaries imposed by law, which were incurred in the
ordinary course of business and do not secure Indebtedness for borrowed
money, such as carriers', warehousemen's, materialmen's and
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mechanics' liens and other similar Liens arising in the ordinary course of
business, and (A) which do not in the aggregate materially detract from
the value of the Borrower's or such Subsidiary's property or assets or
materially impair the use thereof in the operation of the business of the
Borrower or such Subsidiary or (B) which are being contested in good faith
by appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property or assets subject to any
such Lien;
(iii) Liens in existence on the Restatement Date which are
listed, and the property subject thereto described, on Schedule VII
attached hereto, but only to the respective date, if any, set forth in
such Schedule VII for the removal and termination of any such Liens, plus
renewals, replacements and extensions of such Liens (other than Liens
securing the SBA Loan) to the extent set forth on Schedule VII, provided
that (A) the aggregate principal amount of the Indebtedness, if any,
secured by such Liens does not increase from that amount outstanding at
the time of any such renewal or extension and (B) any such renewal or
extension does not encumber any additional assets or properties of
Holdings or any of its Subsidiaries;
(iv) Permitted Encumbrances;
(v) Liens created pursuant to the Security Documents;
(vi) licenses, leases or subleases granted to other Persons in
the ordinary course of business not materially interfering with the
conduct of the business of Holdings and its Subsidiaries taken as a whole;
(vii) Liens upon assets subject to Capitalized Lease Obligations
to the extent permitted by Section 9.04, provided that (A) such Liens only
serve to secure the payment of Indebtedness arising under such Capitalized
Lease Obligation and (B) the Lien encumbering the asset giving rise to the
Capitalized Lease Obligation does not encumber any other asset of the
Borrower or any Subsidiary of the Borrower;
(viii) Liens placed upon equipment or machinery used in the
ordinary course of business of the Borrower or any of its Subsidiaries at
the time of acquisition thereof by the Borrower or any such Subsidiary or
within 120 days thereafter to secure Indebtedness incurred to pay all or a
portion of the purchase price thereof, and all renewals, replacements and
extensions thereof, provided that (A) the aggregate outstanding principal
amount of all Indebtedness secured by Liens permitted by this clause
(viii) shall not at any time exceed $4,000,000 at any time outstanding and
(B) in all events, the Lien encumbering the equipment or machinery so
acquired does not encumber any other asset of the Borrower or such
Subsidiary;
(ix) easements, rights-of-way, restrictions (including zoning
restrictions), encroachments, protrusions and other similar charges or
encumbrances, and minor title deficiencies, in each case whether now or
hereafter in existence, not securing Indebtedness and not materially
interfering with the conduct of the business of the Borrower or any of its
Subsidiaries;
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(x) Liens arising from precautionary UCC financing statement
filings regarding operating leases entered into by the Borrower or any of
its Subsidiaries in the ordinary course of business;
(xi) Liens arising out of the existence of judgments or awards
not constituting an Event of Default under Section 10.09, provided that no
cash or property is deposited or delivered to secure the respective
judgment or award (or any appeal bond in respect thereof, except as
permitted by following clause (xiii));
(xii) statutory and contractual landlords' liens under leases to
which the Borrower or any of its Subsidiaries is a party;
(xiii) Liens (other than any Lien imposed by ERISA) (A) incurred
or deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security or (B) to secure the performance of tenders, statutory
obligations (other than excise taxes), surety, stay, customs and appeal
bonds, statutory bonds, bids, leases, government contracts, trade
contracts, performance and return of money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money)
and (C) deposits made in the ordinary course of business to secure
liability for premiums to insurance carriers, provided that the aggregate
amount of deposits at any time pursuant to clauses (B) and (C) shall not
exceed $1,000,000 in the aggregate;
(xiv) any interest or title of a lessor, sublessor, licensee or
licensor under any lease or license agreement permitted by this Agreement;
(xv) Liens in favor of a banking institution arising as a matter
of law encumbering the deposits (including the right of setoff) held by
such banking institutions incurred in the ordinary course of business and
which are within the general parameters customary in the banking industry;
(xvi) Liens in favor of customs and revenue authorities arising
as a matter of law to secure the payment of customs duties in connection
with the importation of goods;
(xvii) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by
the Borrower or any of its Subsidiaries in the ordinary course of business
in accordance with the past practices of the Borrower and its Subsidiaries
prior to the Restatement Date;
(xviii) Deposits made to secure statutory obligations in the form
of excise taxes;
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(xix) Liens arising out of barter transactions or arrangements
for the sale or purchase of goods or services entered into by the Borrower
or any of its Subsidiaries in the ordinary course of business in
accordance with the past practices of the Borrower and its Subsidiaries
prior to the Restatement Date;
(xx) Liens on cash collateral not to exceed $500,000 arising in
connection with Other Hedging Agreements permitted under Section
9.05(xiii); and
(xxi) Liens not otherwise permitted by the foregoing clauses (i)
through (xx) to the extent attaching to properties and assets with an
aggregate fair value not in excess of, and securing liabilities not in
excess of, $1,000,000 in the aggregate at any time outstanding.
9.02 Consolidation; Merger; Purchase or Sale of Assets; etc.
Holdings will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of (or agree to do
any of the foregoing at any future time) all or any part of its property or
assets, or enter into any sale-leaseback transactions, or purchase or otherwise
acquire (in one or a series of related transactions) any part of the property or
assets (other than purchases or other acquisitions of inventory, materials,
equipment and intangible assets in the ordinary course of business) of any
Person, except that the following shall be permitted:
(i) Capital Expenditures by the Borrower and its Subsidiaries
shall be permitted to the extent not in violation of Section 9.07;
(ii) each of the Borrower and its Subsidiaries may (A) in the
ordinary course of business, sell, lease or otherwise dispose of any
assets which, in the reasonable judgment of such Person, are obsolete,
worn out or otherwise no longer useful in the conduct of such Person's
business and (B) sell, lease or otherwise dispose of any other assets,
provided that the aggregate Net Sale Proceeds of all assets subject to
sales or other dispositions pursuant to this clause (ii) which are not
reinvested to acquire Reinvestment Assets in accordance with Section
4.02(d) shall not exceed $2,000,000 in any Fiscal Year;
(iii) sales of assets the Net Sale Proceeds of which are used to
acquire Reinvestment Assets in accordance with Section 4.02(d);
(iv) investments may be made to the extent permitted by Section
9.05;
(v) each of the Borrower and its Subsidiaries may lease (as
lessee) real or personal property in the ordinary course of business (so
long as any such lease does not create a Capitalized Lease Obligation
except to the extent permitted by Section 9.04);
(vi) each of the Borrower and its Subsidiaries may make sales or
transfers of inventory in the ordinary course of business and consistent
with past practices (including,
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without limitation, sales or transfers of inventory by the Borrower to its
Subsidiaries so long as at fair market value);
(vii) each of the Recapitalization and the Acquisition shall be
permitted;
(viii) the Borrower and its Subsidiaries may sell or discount, in
each case without recourse and in the ordinary course of business,
accounts receivable arising in the ordinary course of business (A) which
are overdue or (B) which the Borrower may reasonably determine are
difficult to collect, but only in connection with the compromise or
collection thereof consistent with customary industry practice (and not as
part of any bulk sale or financing of receivables);
(ix) transfers of condemned property to the respective
governmental authority or agency that have condemned same (whether by deed
in lieu of condemnation or otherwise), and transfers of properties that
have been subject to a casualty to the respective insurer of such property
or its designee as part of an insurance settlement, so long as the
proceeds thereof are applied as required by Section 4.02(e);
(x) license or sublicenses by the Borrower and its Subsidiaries
of software, trademarks and other intellectual property in the ordinary
course of business and which do not materially interfere with the business
of the Borrower or any Subsidiary;
(xi) the Borrower or any Subsidiary may enter into consignment
arrangements (as consignor or as consignee) or similar arrangements for
the sale of goods in the ordinary course of business and consistent with
the past practices of the Borrower and its Subsidiaries prior to the
Restatement Date;
(xii) the Borrower or any Domestic Wholly-Owned Subsidiary of the
Borrower may transfer assets to or lease assets to or acquire or lease
assets from the Borrower or any other Domestic Wholly-Owned Subsidiary or
any Domestic Wholly-Owned Subsidiary may be merged into the Borrower (as
long as the Borrower is the surviving corporation of such merger) or any
other Domestic Wholly-Owned Subsidiary of the Borrower, or any Domestic
Wholly-Owned Subsidiary may dissolve (as long as all of the properties and
assets of such dissolved Subsidiary are distributed in their entirety to
the Borrower or to a Domestic Wholly-Owned Subsidiary of the Borrower);
and
(xiii) so long as no Default or Event of Default then exists or
would result therefrom, the Borrower may acquire assets or the capital
stock of any Person (any such acquisition permitted by this clause (xiii),
a "Permitted Acquisition"), provided, that (i) such Person (or the assets
so acquired) was, immediately prior to such acquisition, engaged (or used)
primarily in the business permitted pursuant to Section 9.13(a), (ii) if
such acquisition is structured as a stock acquisition, then either (A) the
Person so acquired becomes as Wholly-Owned Subsidiary of the Borrower or
(B) such Person is merged with and into the Borrower or a Wholly-Owned
Subsidiary of the Borrower (with the Borrower or such Wholly-Owned
Subsidiary being the
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surviving corporation of such merger), and in any case, all of the
provisions of Section 9.14 have been complied with in respect of such
Person, (iii) any Liens or Indebtedness assumed or issued in connection
with such acquisition are otherwise permitted under Section 9.01 or 9.04,
as the case may be, and (iv) the aggregate amount of consideration paid by
the Borrower or any other Person in connection with all such Permitted
Acquisitions shall not exceed $12,500,000.
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale of any Collateral, or any Collateral is sold as permitted by
this Section 9.02, such Collateral (unless sold to Holdings or a Subsidiary of
Holdings) shall be sold free and clear of the Liens created by the Security
Documents, and the Agent and Collateral Agent shall be authorized to take any
actions deemed appropriate in order to effect the foregoing.
9.03 Dividends. Holdings will not, and will not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to
Holdings or any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may pay Dividends to the
Borrower or any Wholly-Owned Subsidiary of the Borrower;
(ii) the Borrower may pay cash Dividends to Holdings for the
purpose of paying, so long as all proceeds thereof are promptly used by
Holdings to pay, its operating expenses incurred in the ordinary course of
business and other corporate overhead costs and expenses (including,
without limitation, legal and accounting expenses and similar expenses);
(iii) the Borrower may pay cash Dividends to Holdings for the
purpose of paying, so long as all proceeds thereof are promptly used by
Holdings to pay, franchise taxes and federal, state and local income taxes
and interest and penalties with respect thereto, if any, payable by
Holdings, provided that any refund shall be promptly returned by Holdings
to the Borrower;
(iv) the Borrower may pay cash Dividends to Holdings for the
purpose of paying, so long as all proceeds thereof are promptly used by
Holdings to pay, management fees or executive compensation to the extent
such management fees or executive compensation are permitted by Section
9.06(iv);
(v) Holdings may repurchase Holdings Common Stock and/or options
to purchase Holdings Common Stock held by individual directors,
executives, officers, members of management, employees or consultants of
Holdings or any of its Subsidiaries upon the death, disability, retirement
or termination of such individual director, executive, officer, member of
management, employee or consultant or the exercise of such options in
accordance with replacement option and performance option agreements
entered into as part of the Transaction and future option agreements
entered into in the ordinary course of business; provided, however, that
(A) no Default or Event of Default then exists or would result therefrom
and (B) the aggregate amount of cash expended by Holdings pursuant to this
clause (v) shall not exceed $5,000,000 in the aggregate (plus the amount
of cash proceeds received by Holdings from
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reissuance to a new individual director, executive, officer, member of
management, employee or consultant of Holdings or any of its Subsidiaries
of such Holdings Common Stock as a result of such individual replacing a
then employed or retained individual director, executive, officer, member
of management, employee or consultant of Holdings or any of its
Subsidiaries); and provided further, that Holdings may purchase, redeem or
otherwise acquire common stock of Holdings (or options to purchase such
common stock) pursuant to this clause (v) without regard to restrictions
set forth in the first proviso above for consideration consisting of the
proceeds of key man life insurance obtained for the purposes described in
this clause (v);
(vi) the Borrower may pay cash Dividends to Holdings for the
purpose of enabling Holdings to make the purchases referred to in clause
(v) above, so long as all proceeds thereof are promptly used by Holdings
to make such purchases and/or pay such Dividends;
(vii) the Borrower may pay cash Dividends to Holdings for the
purpose of enabling Holdings to consummate the Recapitalization; and
(viii) Holdings may pay cash dividends, make distributions on its
capital stock or make purchases or redemptions of its capital stock (and
the Borrower may pay cash dividends or make distributions on its capital
stock for purposes of enabling Holdings to make such dividends,
distributions, purchases or redemptions) to the extent that the aggregate
amount of all such dividends, distributions, purchases and redemptions
from and after the Closing Date to the date of the proposed dividend,
distribution, purchase or redemption (after giving effect to such proposed
dividend, distribution, purchase or redemption) would not exceed
$5,500,000; provided, however, that no Event of Default or Default shall
have occurred and be continuing before or after giving effect to any such
proposed dividend, distribution, purchase or redemption.
9.04 Indebtedness. Holdings will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the
other Credit Documents;
(ii) Existing Indebtedness shall be permitted to the extent the
same is listed on Schedule V hereto, including any refinancings or
renewals thereof (other than the SBA Loan), provided that (A) the
aggregate principal amount of such Indebtedness does not increase from
that amount outstanding at the time of any such renewal or refinancing and
(B) the Weighted Average Life to Maturity of such Indebtedness is not
decreased;
(iii) Indebtedness of the Borrower incurred under the Senior
Subordinated Notes in an aggregate principal amount not to exceed
$100,000,000 (as reduced by any repayments of principal thereof) and
guarantees of such Indebtedness by any Subsidiary of the Borrower;
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(iv) accrued expenses and current trade accounts payable incurred
in the ordinary course of business;
(v) Indebtedness under Interest Rate Protection Agreements on
terms reasonably acceptable to the Agent;
(vi) Indebtedness evidenced by Capitalized Lease Obligations to
the extent permitted pursuant to Section 9.07;
(vii) intercompany Indebtedness of any Domestic Wholly-Owned
Subsidiary of the Borrower owing to the Borrower or any other Domestic
Wholly-Owned Subsidiary of the Borrower, or of the Borrower owing to any
Domestic Wholly-Owned Subsidiary of the Borrower, to the extent permitted
by Section 9.05(v) or (vi);
(viii) Indebtedness of any Wholly-Owned Subsidiary of the
Borrower to the Borrower or another Wholly-Owned Subsidiary of the
Borrower constituting the purchase price in respect of intercompany
transfers of goods made in the ordinary course of business to the extent
not constituting Indebtedness for borrowed money;
(ix) Indebtedness subject to liens permitted under Section
9.01(viii);
(x) Contingent Obligations of the Borrower or any Subsidiary as a
guarantor of the lessee under any lease pursuant to which the Borrower or
a Subsidiary is the lessee so long as such lease is otherwise permitted
hereunder;
(xi) Indebtedness under Other Hedging Agreements (A) that are
futures contracts for the purchase of raw materials used by the Borrower
and its Subsidiaries incurred in the ordinary course of business and (B)
otherwise, the liabilities of which shall not exceed $500,000 in the
aggregate at any one time, on all terms acceptable to the Agent; and
(xii) additional indebtedness of the Borrower and its
Subsidiaries not to exceed $5,000,000 in aggregate principal amount
outstanding at any one time.
9.05 Advances, Investments and Loans. Holdings will not, and will
not permit any of its Subsidiaries to, directly or indirectly, lend money or
credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents, except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold
accounts receivables owing to any of them, if created or acquired in the
ordinary course of business and payable or dischargeable in accordance
with customary terms;
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(ii) the Borrower and its Subsidiaries may acquire and hold cash
and Cash Equivalents, provided that during any time that Revolving Loans
of Non-Defaulting Banks are outstanding, the aggregate amount of cash and
Cash Equivalents permitted to be held by the Borrower and its Subsidiaries
shall not exceed $4,000,000 for any period of five consecutive days;
(iii) the Borrower and its Subsidiaries may make loans and
advances in the ordinary course of business to their respective officers,
directors and employees so long as the aggregate principal amount thereof
at any time outstanding shall not exceed $500,000;
(iv) the Borrower may enter into Interest Rate Protection
Agreements to the extent permitted by Section 9.04(v);
(v) any Domestic Wholly-Owned Subsidiary may make intercompany
loans to the Borrower or any Domestic Wholly-Owned Subsidiary and the
Borrower may make inter company loans and advances to any Domestic
Wholly-Owned Subsidiary;
(vi) intercompany Indebtedness existing on the Restatement Date
to the extent such intercompany Indebtedness is evidenced by an
intercompany note in the form of Exhibit M, which note is pledged by the
holder thereof as Collateral pursuant to the Pledge Agreement;
(vii) the Borrower and it Subsidiaries may sell or transfer
assets to each other to the extent permitted by Section 9.02;
(viii) the Borrower may establish Subsidiaries to the extent
permitted by Section 9.11;
(ix) Holdings may repurchase Holdings Common Stock to the extent
permitted by Section 9.03;
(x) promissory notes and other similar non-cash consideration
received by the Borrower and its Subsidiaries in connection with
dispositions permitted by Section 9.02 so long as the aggregate principal
amount thereof does not exceed $1,000,000 at any one time outstanding;
(xi) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement
of delinquent obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;
(xii) investments by the Borrower in or to any Domestic
Wholly-Owned Subsidiary;
(xiii) the Borrower may enter into Other Hedging Agreements to
the extent permitted by Section 9.04(xi);
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(xiv) Permitted Acquisitions and the Acquisition shall be
permitted; and
(xv) in addition to the foregoing, the Borrower and its
Subsidiaries may make additional loans, advances and investments not to
exceed $5,000,000 in the aggregate, net of any returns of capital.
9.06 Transactions with Affiliates. Holdings will not, and will
not permit any of its Subsidiaries to, enter into any transaction or series of
related transactions, whether or not in the ordinary course of business, with
any Affiliate of Holdings or any of its Subsidiaries, other than in the ordinary
course of business and on terms and conditions substantially as favorable to
Holdings or such Subsidiary as would reasonably be obtained by Holdings or such
Subsidiary at that time in a comparable arm's-length transaction with a Person
other than an Affiliate, except that:
(i) Dividends may be paid to the extent provided in Section 9.03;
(ii) loans may be made and other transactions may be entered into
between the Borrower and its Subsidiaries to the extent permitted by
Sections 9.02, 9.04 and 9.05;
(iii) customary fees may be paid to non-officer directors of
Holdings;
(iv) Holdings and its Subsidiaries may enter into and make
payments pursuant to employment arrangements with respect to the
procurement of services of their respective officers and employees in the
ordinary course of business;
(v) Holdings may make capital contributions to the Borrower;
(vi) Holdings and/or the Borrower may pay to Hicks, Muse & Co.
Partners, L.P., the amount set forth in (1) the Monitoring Agreement as in
effect on the Closing Date and (2) the Financial Advisory Agreement as in
effect on the Restatement Date;
(vii) Holdings and/or any of its Subsidiaries may provide
management services to, or receive management services on an arm's-length
basis from, an Affiliate of Holdings or any of its Subsidiaries; and
(viii) the Borrower or any of its Subsidiaries may make payments
required under that certain Stock Purchase Agreement dated September 27,
1996 relating to the acquisition of Vinyl Building Specialties of
Connecticut, Inc. and Bishop Manufacturing Co. of New York, Inc. by the
Borrower, as such Stock Purchase Agreement is in effect as of the Closing
Date.
Except as specifically provided above, no management or similar
fees shall be paid or payable by Holdings or any of its Subsidiaries to any
Person.
9.07 Capital Expenditures. (a) Holdings will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures except in
accordance with this Section 9.07.
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(b) Notwithstanding anything to the contrary contained in clause
(a) above, during any Fiscal Year the Borrower and its Subsidiaries may make
Capital Expenditures so long as the aggregate amount of such Capital
Expenditures made under this Section 9.07(b) does not exceed in any Fiscal Year
set forth below the amount set forth opposite such Fiscal Year:
Fiscal Year Amount
----------- -------
1996 $4,500,000
1997 $4,750,000
1998 $6,600,000
1999 $5,500,000
2000 $5,800,000
2001 $6,100,000
2002 $6,400,000
2003 $6,700,000
2004 $1,750,000
(c) Notwithstanding anything to the contrary contained in clauses
(a) or (b) above, to the extent that the aggregate amount of Capital
Expenditures made by the Borrower and its Subsidiaries pursuant to clause (b)
above (excluding only those Capital Expenditures made pursuant to clause (d)
below) in any Fiscal Year is less than the amount set forth above in clause (b)
with respect to such Fiscal Year, up to 50% of the amount of such difference may
be carried forward and used by the Borrower and its Subsidiaries to make Capital
Expenditures in the immediately succeeding Fiscal Year.
(d) In addition to the Capital Expenditures permitted pursuant to
preceding clauses (b) and (c), the Borrower and its Subsidiaries may make
additional Capital Expenditures as follows: (i) Capital Expenditures consisting
of the reinvestment of Net Sale Proceeds of asset sales not required to be
applied to prepay the Loans pursuant to Section 4.02(b) as a result of (A)
clause (ii) of the first parenthetical phrase contained therein and (B) the
acquisition of Reinvestment Assets pursuant to the proviso thereto, (ii) the
reinvestment of proceeds of Recovery Events not required to be applied to prepay
the Loans pursuant to Section 4.02(c), and (iii) Capital Expenditures
constituting Permitted Acquisitions and the Acquisition.
9.08 Minimum Consolidated Interest Coverage Ratio. The Borrower
will not permit the Consolidated Interest Coverage Ratio for any Test Period
ended on the last day of a fiscal quarter of the Borrower set forth below to be
less than the amount set forth opposite such fiscal quarter below:
Fiscal Quarter Ending Ratio
--------------------- -----
December 31, 1996 1.50:1
March 31, 1997 1.50:1
June 30, 1997 1.50:1
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September 30, 1997 1.50:1
December 31, 1997 1.50:1
March 31, 1998 1.65:1
June 30, 1998 1.65:1
September 30, 1998 1.65:1
December 31, 1998 1.65:1
March 31, 1999 1.75:1
June 30, 1999 1.75:1
September 30, 1999 1.75:1
December 31, 1999 1.75:1
March 31, 2000 1.85:1
June 30, 2000 1.85:1
September 30, 2000 1.85:1
December 31, 2000 1.85:1
March 31, 2001 2.00:1
June 30, 2001 2.00:1
September 30, 2001 2.00:1
December 31, 2001 2.00:1
March 31, 2002 2.10:1
June 30, 2002 2.10:1
September 30, 2002 2.10:1
December 31, 2002 2.10:1
March 31, 2003 2.25:1
June 30, 2003 2.25:1
September 30, 2003 2.25:1
December 31, 2003 2.25:1
March 31, 2004 2.25:1
Notwithstanding anything to the contrary herein, for purposes of
determining the Consolidated Interest Coverage Ratio pursuant to this Section
9.08 for the Test Periods ending December 31, 1996, March 31, 1997, June 30,
1997 and September 30, 1997, (i) Consolidated EBITDA for the fiscal quarters
ending December 31, 1995, March 31, 1996, June 30, 1996 and September 30, 1996
shall be deemed to be $7,162,000, $5,522,000, $7,228,000 and $6,795,000,
respectively, and (ii) Consolidated Net Cash Interest Expense for the fiscal
quarters ending December 31, 1995, March 31, 1996, June 30, 1996 and September
30, 1996 shall be deemed to be $2,750,000, for each such fiscal quarter.
9.09 Minimum Consolidated EBITDA. The Borrower will not permit
Consolidated EBITDA for any Test Period, in each case taken as one accounting
period, ended on the last day of a fiscal quarter of the Borrower set forth
below to be less than the amount set forth opposite such fiscal quarter below:
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Fiscal Quarter Ending Amount
---------------------- ------
December 31, 1996 $16,130,000
March 31, 1997 $16,140,000
June 30, 1997 $16,140,000
September 30, 1997 $16,140,000
December 31, 1997 $16,140,000
March 31, 1998 $17,770,000
June 30, 1998 $19,000,000
September 30, 1998 $21,000,000
December 31, 1998 $23,300,000
March 31, 1999 $23,500,000
June 30, 1999 $23,900,000
September 30, 1999 $24,400,000
December 31, 1999 $24,700,000
March 31, 2000 $24,900,000
June 30, 2000 $25,400,000
September 30, 2000 $25,900,000
December 31, 2000 $26,200,000
March 31, 2001 $26,400,000
June 30, 2001 $26,900,000
September 30, 2001 $27,400,000
December 31, 2001 $27,800,000
March 31, 2002 $28,000,000
June 30, 2002 $28,500,000
September 30, 2002 $29,100,000
December 31, 2002 $29,500,000
March 31, 2003 $29,700,000
June 30, 2003 $30,200,000
September 30, 2003 $30,800,000
December 31, 2003 $31,200,000
March 31, 2004 $31,500,000
Notwithstanding anything to the contrary herein, for purposes of
determining the minimum Consolidated EBITDA pursuant to this Section 9.09 for
the Test Periods ending December 31, 1996, March 31, 1997, June 30, 1997 and
September 30, 1997, Consolidated EBITDA for the fiscal quarters ending December
31, 1995, March 31, 1996, June 30, 1996 and September 30, 1996 shall be deemed
to be $7,162,000, $5,522,000, $7,228,000 and $6,795,000, respectively.
9.10 Limitation on Modifications of Indebtedness and Payments of
Indebtedness; Modifications of Certificate of Incorporation, By-Laws and Certain
Other Agreements; etc. Holdings will not, and will not permit any of its
Subsidiaries to:
(i) amend or modify, or permit the amendment or modification of,
any provision of the Existing Indebtedness or the Monitoring Agreement, or
of any agreement (including,
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without limitation, any purchase agreement, indenture, loan agreement,
security agreement or certificate of designation) relating thereto other
than any amendments or modifications to the Existing Indebtedness which do
not in any way adversely affect the interests of the Banks and are
otherwise permitted under Section 9.04(ii);
(ii) amend or modify, or permit the amendment or modification of,
any provision of any Senior Subordinated Note Document, except for any
amendment or modification which provides solely for the addition of
subsidiary guarantors ;
(iii) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption or acquisition for value
of, or any prepayment or redemption as a result of any asset sale, change
of control or similar event of, any Senior Subordinated Note; or
(iv) amend, modify or change its Certificate of Incorporation
(including, without limitation, by the filing or modification of any
certificate of designation or By-Laws, or any agreement entered into by
it, with respect to its capital stock (including any Shareholders'
Agreement), or enter into any new agreement with respect to its capital
stock, other than any amendments, modifications or changes pursuant to
this clause (iii) or any such new agreements pursuant to this clause (iii)
which do not in any way adversely affect the interests of the Banks.
9.11 Limitation on Certain Restrictions on Subsidiaries. Holdings
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (i) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by Holdings or any Subsidiary of
Holdings, or pay any Indebtedness owed to Holdings or a Subsidiary of Holdings,
(ii) make loans or advances to Holdings or any of Holdings' Subsidiaries or
(iii) transfer any of its properties or assets to Holdings or any of Holdings'
Subsidiaries, except for such encumbrances or restrictions existing under or by
reason of (A) applicable law, (B) this Agreement and the other Credit Documents,
(C) customary provisions restricting subletting or assignment of any lease
governing a leasehold interest of the Borrower or a Subsidiary of the Borrower,
(D) customary provisions restricting assignment of any licensing agreement
entered into by the Borrower or a Subsidiary of the Borrower in the ordinary
course of business and (E) the Senior Subordinated Note Documents.
9.12 Limitation on Issuance of Capital Stock. (a) Holdings shall
not issue any class of capital stock other than non-redeemable common stock.
(b) No Subsidiary of Holdings shall issue, or permit any of
its Subsidiaries to issue, any class of capital stock other than non-redeemable
common stock, provided that Subsidiaries formed after the Closing Date pursuant
to Section 9.15 may issue capital stock to the Borrower or a Subsidiary of the
Borrower which is to own such stock. All capital stock issued in accordance with
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this Section 9.13(b) shall be delivered to the Collateral Agent for pledge
pursuant to the applicable Pledge Agreement.
9.13 Changes in Business. (a) The Borrower and its
Subsidiaries will not engage in any business other than the business engaged in
by them as of the Closing Date and activities directly related thereto, and
businesses complementary to the business or similar or related businesses.
(b) Holdings will engage in no business other than (i) its
ownership of the capital stock of the Borrower, (ii) the issuance of the
Holdings Common Stock and options and warrants to purchase Holdings Common Stock
and (iii) activities associated with expenses paid with dividends made by the
Borrower pursuant to Section 9.03. Notwithstanding the foregoing, Holdings may
engage in those activities that are incidental to (A) the maintenance of its
corporate existence in compliance with applicable law, (B) legal, tax and
accounting matters in connection with any of the foregoing activities and (C)
entering into, and performing its obligations under, the Documents to which it
is a party.
9.14 Limitation on Creation of Subsidiaries. Except for (x) a
Domestic Wholly-Owned Subsidiary formed for the purpose of consummating a
Permitted Acquisition (so long as neither the value of the total assets or the
net worth of such Subsidiary exceeds $1,000) (an "Acquisition Subsidiary"), (y)
Atrium Arizona and (z) subject to Section 8.14, Masterview California, Holdings
will not, and will not permit any Subsidiary to, establish, create or acquire
any additional Subsidiaries without the prior written consent of the Required
Banks. Without limiting the foregoing, (i) such new Subsidiaries (other than an
Acquisition Subsidiary, but only for a period of 60 days after the creation
thereof) may be required to execute such guarantees and security documents as
the Required Banks shall request (including documents substantially similar to
or amendments to each of (A) the Pledge Agreement, (B) the Subsidiary Guarantee
and (C) the Security Agreement), and in such forms as shall be satisfactory to
them and (ii) the holders of the capital stock of such new Subsidiaries may be
required to execute and deliver additional pledge agreements, in form and
substance satisfactory to the Agent.
SECTION 10. EVENTS OF DEFAULT. Upon the occurrence of any of
the following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment
when due of any principal of any Loan or any Note or (ii) default, and such
default shall continue unremedied for three or more Business Days, in the
payment when due of any Unpaid Drawings or interest on any Loan or Note, or any
Fees or any other amounts owing hereunder or thereunder; or
10.02 Representations, Etc. Any representation, warranty or
statement made by any Credit Party herein or in any other Credit Document or in
any certificate delivered pursuant hereto or thereto shall prove to be untrue in
any material respect on the date as of which made or deemed made; or
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10.03 Covenants. Any Credit Party shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.01(f)(i), 8.07, 8.11, 8.13 or Section 9 or (ii) default in the due
performance or observance by it of any other term, covenant or agreement
contained in this Agreement and such default shall continue unremedied for a
period of 30 days after written notice to the Borrower by the Agent or any Bank;
or
10.04 Default Under Other Agreements. Holdings or any of its
Subsidiaries shall (i) default in any payment of any Indebtedness (other than
the Obligations) beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created or (ii) default in the
observance or performance of any agreement or condition relating to any
Indebtedness (other than the Obligations) or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required), any such Indebtedness to
become due prior to its stated maturity, or (iii) any Indebtedness (other than
the Obligations) of Holdings or any of its Subsidiaries shall be declared to be
due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof, provided that (A) it
shall not be a Default or an Event of Default under this Section 10.04 unless
the aggregate principal amount of all Indebtedness as described in preceding
clauses (i) through (iii), inclusive, is at least $5,000,000; or
10.05 Bankruptcy, Etc. Holdings or any of its Subsidiaries
shall commence a voluntary case concerning itself under Title 11 of the United
States Code entitled "Bankruptcy," as now or hereafter in effect, or any
successor thereto (the "Bankruptcy Code"); or an involuntary case is commenced
against Holdings or any of its Subsidiaries and the petition is not controverted
within 10 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of, all or substantially all of the property of Holdings or any of
its Subsidiaries, or Holdings or any of its Subsidiaries commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to Holdings or any of
its Subsidiaries, or there is commenced against Holdings or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days, or Holdings or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or Holdings or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or
Holdings or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by Holdings or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code, any Plan shall have had or, in the reasonable opinion
of the Required Banks, is reasonably expected to have a trustee appointed to
administer such Plan under Title IV of ERISA, any Plan is, shall have been or is
reasonably
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expected to be terminated or to be the subject of termination proceedings under
ERISA, any Plan shall have an Unfunded Current Liability, a contribution
required to be made to a Plan has not been made, Holdings or any of its
Subsidiaries or any ERISA Affiliate has incurred or is reasonably expected to
incur a liability to or on account of a Plan under Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29),
4971, 4975 or 4980 of the Code, or Holdings or any of its Subsidiaries has
incurred or is reasonably expected to incur liabilities pursuant to one or more
employee welfare benefit plans (as defined in Section 3(1) of ERISA) which
provide benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or employee pension benefit plans (as defined
in Section 3(2) of ERISA); (b) there shall result from any such event or events
the imposition of a lien, the granting of a security interest, or a liability or
a material risk of incurring a liability; and in each case in clauses (a) and
(b) above, such lien, security interest or liability, in the reasonable opinion
of the Required Banks, will have a Material Adverse Effect; or
10.07 Security Documents. At any time after the execution and
delivery thereof, any of the Security Documents shall cease to be in full force
and effect, or shall cease in any material respect to give the Collateral Agent
for the benefit of the Secured Creditors the Liens, rights, powers and
privileges purported to be created thereby (including, without limitation, a
perfected security interest in, and Lien on, all of the Collateral), in favor of
the Collateral Agent, superior to and prior to the rights of all third Persons
(except as permitted by Section 9.01), and subject to no other Liens (except as
permitted by Section 9.01), or any Credit Party shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any of the Security Documents and such default
shall continue beyond any grace period specifically applicable thereto pursuant
to the terms of such Security Document; or
10.08 Guaranty. Any Guaranty or any provision thereof shall
cease to be in full force or effect as to the relevant Guarantor, or any
Guarantor or Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor's obligations under the relevant Guaranty, or any
Guarantor shall default in the due performance or observance of any term,
covenant or agreement on its part to be performed or observed pursuant to its
Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be
entered against Holdings or any of its Subsidiaries involving in the aggregate
for Holdings and its Subsidiaries a liability (not paid or fully covered by a
reputable and solvent insurance company) and such judgments and decrees either
shall be final and non-appealable or shall not be vacated, discharged or stayed
or bonded pending appeal for any period of 60 consecutive days, and the
aggregate amount of all such judgments exceeds $5,000,000; or
10.10 Change of Control. A Change of Control shall occur; or
10.11 Environmental Matters. At any time after the execution
and delivery thereof, the Environmental Indemnity Agreement or any provision
thereof shall cease to be in full force or effect as to Holdings or any of its
Subsidiaries, or Holdings or any of its Subsidiaries shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed
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or observed pursuant to the Environmental Indemnity Agreement, and such default
shall continue unremedied for a period of 30 days after written notice to the
Borrower by the Agent or any Bank;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Agent, upon the written request of the Required
Banks, shall by written notice to the Borrower, take any or all of the following
actions, without prejudice to the rights of the Agent, any Bank or the holder of
any Note to enforce its claims against any Credit Party (provided that, if an
Event of Default specified in Section 10.05 shall occur with respect to the
Borrower, the result which would occur upon the giving of written notice by the
Agent to the Borrower as specified in clauses (i) and (ii) below shall occur
automatically without the giving of any such notice): (i) declare the Total
Commitments terminated, whereupon all Commitments of the Banks shall forthwith
terminate immediately and any Commitment Commission shall forthwith become due
and payable without any other notice of any kind; (ii) declare the principal of
and any accrued interest in respect of all Loans and the Notes and all
Obligations owing hereunder and thereunder to be, whereupon the same shall
become, forthwith due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by each Credit Party; (iii)
terminate any Letter of Credit, which may be terminated, in accordance with its
terms; (iv) direct the Borrower to pay (and the Borrower agrees that upon
receipt of such notice, or upon the occurrence of an Event of Default specified
in Section 10.05 with respect to the Borrower, it will pay) to the Collateral
Agent at the Payment Office such additional amount of cash, to be held as
security by the Collateral Agent, as is equal to the aggregate Stated Amount of
all Letters of Credit issued for the account of the Borrower and then
outstanding; (v) enforce, as Collateral Agent, all of the Liens and security
interests created pursuant to the Security Documents; and (vi) apply any cash
collateral as provided in Section 4.02.
SECTION 11. DEFINITIONS AND ACCOUNTING TERMS.
11.01 Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Acquired Business" has the meaning assigned to that term in
the definition of "Acquisition."
"Acquisition" means the acquisition by Atrium Arizona of
substantially all of the assets and assumption of certain liabilities (all such
assets and liabilities being referred to hereafter as the "Acquired Business")
of Masterview Window on the Restatement Date pursuant to the Acquisition
Documents.
"Acquisition Documents" means the Asset Purchase Agreement
dated as of March 4, 1998 between Masterview Window and the Borrower, together
with all Schedules and Exhibits thereto and all agreements, documents and
instruments executed and delivered in connection therewith.
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"Additional Collateral" shall mean all property (whether real
or personal) in which security interests are granted (or have been purported to
be granted) (and continue to be in effect at the time of determination) pursuant
to Section 8.10.
"Additional Mortgage" shall have the meaning provided in
Section 8.10(a).
"Additional Mortgaged Property" shall have the meaning
provided in Section 8.10(a).
"Additional Security Documents" shall mean all mortgages,
pledge agreements, security agreements and other security documents entered into
pursuant to Section 8.10 with respect to Additional Collateral.
"Adjusted Certificate of Deposit Rate" shall mean, on any day,
the sum (rounded to the nearest 1/100 of 1%) of (i) the rate obtained by
dividing (A) the most recent weekly average dealer offering rate for negotiable
certificates of deposit with a three-month maturity in the secondary market as
published in the most recent Federal Reserve System publication entitled "Select
Interest Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Agent on the basis of quotations for such
certificates received by it from three certificate of deposit dealers in New
York of recognized standing or, if such quotations are unavailable, then on the
basis of other sources reasonably selected by the Agent, by (B) a percentage
equal to 100% minus the stated maximum rate of all reserve requirements as
specified in Regulation D applicable on such day to a three-month certificate of
deposit of a member bank of the Federal Reserve System in excess of $100,000
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves), plus (ii) the then daily net annual assessment rate as
estimated by the Agent for determining the current annual assessment payable by
the Agent to the Federal Deposit Insurance Corporation for insuring three-month
certificates of deposit.
"Adjusted Consolidated Net Income" for any period shall mean
Consolidated Net Income for such period plus, without duplication, the sum of
the amount of (i) all non-cash charges (including, without limitation,
depreciation, amortization, deferred tax expense and non-cash interest expense,
but excluding any non-cash charges reflected in Adjusted Consolidated Working
Capital) and (ii) non-cash losses (including non-cash losses from the sale of
assets) which were included in arriving at Consolidated Net Income for such
period less the sum of (x) the amount of all non-cash gains (including non-cash
gains from asset sales and excluding items reflected in Adjusted Consolidated
Working Capital) and (y) all deferred tax benefits included in arriving at
Consolidated Net Income for such period.
"Adjusted Consolidated Working Capital" at any time shall mean
Consolidated Current Assets (but excluding therefrom all cash and Cash
Equivalents) less Consolidated Current Liabilities.
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"Adjusted Percentage" shall mean (x) at a time when no Bank
Default exists, for each Bank, such Bank's Percentage and (y) at a time when a
Bank Default exists (i) for each Bank that is a Defaulting Bank, zero and (ii)
for each Bank that is a Non-Defaulting Bank, the percentage determined by
dividing such Bank's Revolving Loan Commitment at such time by the Adjusted
Total Revolving Loan Commitment at such time, it being understood that all
references herein to Revolving Loan Commitments and the Adjusted Total Revolving
Loan Commitment at a time when the Total Revolving Loan Commitment or Adjusted
Total Revolving Loan Commitment, as the case may be, has been terminated shall
be references to the Revolving Loan Commitments or Adjusted Total Revolving Loan
Commitment, as the case may be, in effect immediately prior to such termination,
provided that (A) no Bank's Adjusted Percentage shall change upon the occurrence
of a Bank Default from that in effect immediately prior to such Bank Default if
after giving effect to such Bank Default, and any repayment of Revolving Loans
at such time pursuant to Section 4.02(a) or otherwise, the sum of (i) the
aggregate outstanding principal amount of Revolving Loans of all Non-Defaulting
Banks plus (ii) the Letter of Credit Outstandings, exceed the Adjusted Total
Revolving Loan Commitment; (B) the changes to the Adjusted Percentage that would
have become effective upon the occurrence of a Bank Default but that did not
become effective as a result of the preceding clause (A) shall become effective
after the occurrence of the relevant Bank Default to the extent the sum of (i)
the aggregate outstanding principal amount of the Revolving Loans of all
Non-Defaulting Banks plus (ii) the Letter of Credit Outstandings is equal to or
less than the Adjusted Total Revolving Loan Commitment; and (C) if (i) a
Non-Defaulting Bank's Adjusted Percentage is changed pursuant to the preceding
clause (B) and (ii) any repayment of such Bank's Revolving Loans, or of Unpaid
Drawings with respect to Letters of Credit, that were made during the period
commencing after the date of the relevant Bank Default and ending on the date of
such change to its Adjusted Percentage must be returned to the Borrower as a
preferential or similar payment in any bankruptcy or similar proceeding of the
Borrower, then the change to such Non-Defaulting Bank's Adjusted Percentage
effected pursuant to said clause (B) shall be reduced to that positive change,
if any, as would have been made to its Adjusted Percentage if (x) such
repayments had not been made and (y) the maximum change to its Adjusted
Percentage would have resulted in the sum of the outstanding principal of
Revolving Loans made by such Bank plus such Bank's new Adjusted Percentage of
the outstanding principal amount of Letter of Credit Outstandings equaling such
Bank's Revolving Loan Commitment at such time.
"Adjusted Total Revolving Loan Commitment" shall mean at any
time the Total Revolving Loan Commitment less the aggregate Revolving Loan
Commitments of all Defaulting Banks.
"Affected Eurodollar Loans" shall have the meaning provided in
Section 4.02(g).
"Affiliate" shall mean, with respect to any Person, any other
Person (including, for purposes of Section 9.06 only, all directors, officers
and partners of such Person) directly or in directly controlling, controlled by,
or under direct or indirect common control with, such Person; provided, however,
that for purposes of Section 9.06, an Affiliate of Holdings shall include any
Person that directly or indirectly owns more than 5% of any class of the capital
stock of Holdings and any officer or director of Holdings or any such Person. A
Person shall be deemed to control
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another Person if such Person possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of such other
Person, whether through the ownership of voting securities, by contract or
otherwise.
"Agent" shall mean Bankers Trust Company, in its capacity as
Agent for the Banks hereunder, and shall include any successor to the Agent
appointed pursuant to Section 12.09.
"Aggregate Unutilized Commitments" with respect to any Bank at
any time shall mean such Bank's Unutilized Revolving Loan Commitment at such
time, if any.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented, amended, restated, extended, renewed or replaced from time to
time.
"Anticipated Reinvestment Amount" shall mean, with respect to
any Reinvestment Election, the amount specified in the Reinvestment Notice
delivered by the Borrower in connection therewith as the amount that the
Borrower intends to use to purchase, construct or otherwise acquire Reinvestment
Assets.
"Applicable Margin" shall mean a percentage per annum equal to
(i) in the case of Loans which are maintained as Base Rate Loans, 1.25%, and
(ii) in the case of Loans which are maintained as Eurodollar Loans, 2.25%.
"Assignment and Assumption Agreement" shall mean the
Assignment and Assumption Agreement substantially in the form of Exhibit N
attached hereto (appropriately completed).
"Atrium Arizona" shall mean Atrium Door and Window Company of
Arizona, a Delaware corporation and a direct Wholly-Owned Subsidiary of the
Borrower.
"Authorized Officer" of any Credit Party shall mean any of the
Chairman of the Board, the President, the Chief Financial Officer, any Vice
President, the Treasurer, the Secretary, any Assistant Secretary, any Assistant
Treasurer or the Controller of such Credit Party or any other officer of such
Credit Party which is designated in writing to the Agent, BTCo and any other
Issuing Bank by any of the foregoing officers of such Credit Party as being
authorized to give such notices under this Agreement.
"Bank" shall mean each financial institution listed on
Schedule I attached hereto, as well as any Person which becomes a "Bank"
hereunder pursuant to Section 13.04(b).
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing or to fund
its portion of any unreimbursed payment under Section 2.03(c) or (ii) a Bank
having notified in writing the Borrower and/or the Agent that it does not intend
to comply with its obligations under Section 1.01(c) or Section 2, in the case
of either clause (i) or (ii) as a result of any takeover of such Bank by any
regulatory authority or agency.
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"Bankruptcy Code" shall have the meaning provided in Section
10.05.
"Base Rate" at any time shall mean the highest of (i) 1/2 of
1% in excess of the Adjusted Certificate of Deposit Rate and (ii) the Prime
Lending Rate.
"Base Rate Loan" shall mean each Loan designated or deemed
designated as such by the Borrower at the time of the incurrence thereof or
conversion thereto.
"Borrower" shall have the meaning provided in the preamble of
this Agreement.
"Borrowing" shall mean the borrowing of one Type of Loan of a
single Tranche from all the Banks having Commitments of the respective Tranche
on a given date (or resulting from a conversion or conversions on such date)
having in the case of Eurodollar Loans the same Interest Period, provided that
Base Rate Loans incurred pursuant to Section 1.10(b) shall be considered part of
the related Borrowing of Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company in its individual
capacity.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day except Saturday, Sunday and any day which
shall be in New York City a legal holiday or a day on which banking institutions
are authorized or required by law or other government action to close and (ii)
with respect to all notices and determinations in connection with, and payments
of principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in the New York interbank Eurodollar market.
"Capital Expenditures" shall mean, with respect to any Person,
all expenditures by such Person which should be capitalized in accordance with
generally accepted accounting principles, including all such expenditures with
respect to fixed or capital assets (including, without limitation, expenditures
for maintenance and repairs which should be capitalized in accordance with
generally accepted accounting principles) and the amount of Capitalized Lease
Obligations incurred by such Person.
"Capitalized Lease Obligations" of any Person shall mean all
rental obligations which, under generally accepted accounting principles, are or
will be required to be capitalized on the books of such Person, in each case
taken at the amount thereof accounted for as indebtedness in accordance with
such principles.
"Cash Equivalents" shall mean, as to any Person, (i)
securities issued or directly and fully guaranteed or insured by the United
States or any agency or instrumentality thereof (provided that the full faith
and credit of the United States is pledged in support thereof) having maturities
of not more than one year from the date of acquisition, (ii) time deposits and
certificates of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company organized under the laws of the
United States, any State thereof or the District of Columbia
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having capital, surplus and undivided profits aggregating in excess of
$200,000,000, with maturities of not more than one year from the date of
acquisition by such Person, (iii) repurchase obligations with a term of not more
than 90 days for underlying securities of the types described in clause (i)
above entered into with any bank meeting the qualifications specified in clause
(ii) above, (iv) commercial paper issued by any Person incorporated in the
United States rated at least A-1 or the equivalent thereof by Standard & Poor's
Rating Services, a division of McGraw-Hill, Inc., or at least P-1 or the
equivalent thereof by Moody's Investors Service, Inc. and in each case maturing
not more than one year after the date of acquisition by such Person, (v)
investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (i) through (iv) above
and (vi) deposit accounts maintained in the ordinary course of business.
"Change of Control" shall mean (i) Holdings shall at any time
cease to own 100% of the capital stock of the Borrower; (ii) if the Permitted
Investors shall cease to have the power, directly or indirectly, to vote or
direct the voting of securities having a majority of the ordinary voting power
for the election of directors of Holdings, provided that the occurrence of the
foregoing event shall not be deemed a "Change of Control" if (A) at any time
prior to the consummation of an Initial Public Offering, (1) the Permitted
Investors otherwise have the right to designate (and do so designate) a majority
of the board of directors of Holdings or (2) the HM Group own of record and
beneficially an amount of common stock of Holdings equal to at least 50% of the
amount of common stock of Holdings (adjusted for stock splits, stock dividends
and other similar events on an equitable basis) owned by the HM Group of record
and beneficially as of the Closing Date and such ownership by the HM Group
represents the largest single block of voting securities of Holdings held by any
"person" or "group" for purposes of Section 13(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or (B) at any time after the
consummation of an Initial Public Offering, (1) no "person" or "group" (as such
terms are used in Section 13(d) and 14(d) of the Exchange Act), excluding the
Permitted Investors, shall become the "beneficial owner" (as defined in Rules
13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more
than the greater of (x) 15% of the then outstanding voting stock of Holdings and
(y) the percentage of the then outstanding voting stock of Holdings owned by the
Permitted Investors and (2) the board of directors of Holdings shall consist of
a majority of Continuing Directors.
"Closing Date" shall mean November 27, 1996.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and the rulings
issued thereunder. Section references to the Code are to the Code, as in effect
at the Closing Date, and to any subsequent provision of the Code, amendatory
thereof, supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or
personal) with respect to which any security interests have been granted (or
purported to be granted) pursuant to any Security Document, including, without
limitation, all Pledge Agreement Collateral, all Security Agreement Collateral,
the Mortgaged Properties, all cash and Cash Equivalents delivered as collateral
pursuant to Section 4.02 or 10 hereof and all Additional Collateral, if any.
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"Collateral Agent" shall mean the Agent acting as collateral
agent for the Secured Creditors pursuant to the Security Documents.
"Collective Bargaining Agreements" shall have the meaning
provided in Section 5.05.
"Commitment" shall mean any of the commitments of any Bank,
i.e., whether the Term Loan Commitment or Revolving Loan Commitment.
"Commitment Commission" shall have the meaning provided in
Section 3.01(a).
"Consolidated Current Assets" shall mean, at any time, the
consolidated current assets of Holdings and its Consolidated Subsidiaries.
"Consolidated Current Liabilities" shall mean, at any time,
the consolidated current liabilities of Holdings and its Consolidated
Subsidiaries at such time, but excluding (i) the current portion of any
Indebtedness under this Agreement and any other long-term Indebtedness which
would otherwise be included therein, (ii) accrued but unpaid interest with
respect to the Indebtedness described in clause (i), and (iii) the current
portion of Indebtedness constituting Capitalized Lease Obligations.
"Consolidated EBIT" shall mean, for any period, the
Consolidated Net Income of Holdings and its Consolidated Subsidiaries, before
Consolidated Net Cash Interest Expense and provision for taxes and without
giving effect to any extraordinary gains or losses or gains or losses from sales
of assets other than inventory sold in the ordinary course of business.
"Consolidated EBITDA" shall mean, for any period, Consolidated
EBIT, adjusted by adding thereto the amount of all amortization of intangibles
and depreciation and all non-cash charges, in each case that were deducted in
arriving at Consolidated EBIT for such period, and, solely with respect to the
fourth fiscal quarter of 1996, all cash charges relating to the Transaction.
"Consolidated Indebtedness" shall mean the sum of (i) an
amount equal to the principal amount of all outstanding Senior Subordinated
Notes, (ii) an amount equal to the principal amount of all outstanding Term
Loans, (iii) an amount equal to the average aggregate outstanding principal
amount of Revolving Loans for the preceding twelve-month period (provided that
for purposes of determining the average aggregate outstanding amount of
Revolving Loans for Test Periods ending prior to the first anniversary of the
Closing Date, such Test Periods shall commence on the Closing Date) and (iv) an
amount equal to the principal amount of all other funded indebtedness of
Holdings and its respective Subsidiaries, each determined in accordance with
GAAP.
"Consolidated Interest Coverage Ratio" for any period shall
mean the ratio of Consolidated EBITDA to Consolidated Net Cash Interest Expense
for such period.
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"Consolidated Net Cash Interest Expense" shall mean, for any
period, without duplication total cash interest expense (including that
attributable to Capitalized Lease Obligations in accordance with GAAP) of
Holdings and its Subsidiaries on a consolidated basis with respect to all
outstanding Indebtedness of Holdings and its Subsidiaries, including, without
limitation, all commissions, discounts and other fees and charges paid with
respect to letters of credit and bankers' acceptance financing and net costs
under Interest Rate Protection Agreements, but excluding the amortization of any
deferred financing costs incurred in connection with the Transactions and the
Acquisition net of the total consolidated cash interest income of Holdings and
its Consolidated Subsidiaries for such period.
"Consolidated Net Income" shall mean, for any period, the
consolidated net after tax income of Holdings and its Consolidated Subsidiaries
determined in accordance with GAAP.
"Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes.
"Contingent Obligation" shall mean, as to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (A) for the purchase or payment of any such primary obligation or
(B) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect thereof;
provided, however, that the term Contingent Obligation shall not include (x)
endorsements of instruments for deposit or collection in the ordinary course of
business and (y) customary indemnification obligations incurred in the ordinary
course of business. The amount of any Contingent Obligation shall be deemed to
be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made (or, if the
less, the maximum amount of such primary obligation for which such Person may be
liable pursuant to the terms of the instrument evidencing such Contingent
Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of Holdings on
the date which occurs six months prior to the consummation of an Initial Public
Offering and each other director, if such Director's nomination for election to
the Board of Directors of Holdings is recommended by a majority of the then
Continuing Directors.
"Credit Documents" shall mean this Agreement, the Subsidiary
Guaranty, each Note, the Environmental Indemnity Agreement, each Security
Document and, after the execution and
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delivery thereof, each additional guaranty or security document executed
pursuant to Section 8.10, in each case as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof and hereof.
"Credit Event" shall mean the making of any Loan or the
issuance of any Letter of Credit (but excluding any conversion or continuation
of an existing Loan).
"Credit Party" shall mean Holdings, the Borrower and each
Subsidiary Guarantor.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a
Bank Default is in effect.
"Dividend" with respect to any Person shall mean that such
Person has declared or paid a dividend or returned any equity capital to its
stockholders or authorized or made any other distribution, payment or delivery
of property (other than common stock of such Person) or cash to its stockholders
as such, or redeemed, retired, purchased or otherwise acquired, directly or
indirectly, for a consideration any shares of any class of its capital stock
outstanding on or after the Closing Date (or any options or warrants issued by
such Person with respect to its capital stock), or set aside any funds for any
of the foregoing purposes, or shall have permitted any of its Subsidiaries to
purchase or otherwise acquire for a consideration any shares of any class of the
capital stock of such Person outstanding on or after the Closing Date (or any
options or warrants issued by such Person with respect to its capital stock).
Without limiting the foregoing, "Dividends" with respect to any Person shall
also include all payments made or required to be made by such Person with
respect to any stock appreciation rights, plans, equity incentive or achievement
plans or any similar plans or setting aside of any funds for the foregoing
purposes.
"Documents" shall mean the Credit Documents, the Acquisition
Documents and the Recapitalization Documents.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Domestic Subsidiary" shall mean each Subsidiary of the
Borrower, incorporated or organized in the United States or any State or
territory thereof.
"Domestic Wholly-Owned Subsidiary" shall mean each Domestic
Subsidiary which is a Wholly-Owned Subsidiary of the Borrower.
"Drawing" shall have the meaning provided in Section 2.04(b).
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"Eligible Transferee" shall mean and include a commercial
bank, financial institution or other "accredited investor" (as defined in
Regulation D of the Securities Act).
"Employee Benefit Plans" shall mean (i) those described in
Section 5.05 and (ii) after the Closing Date, any Plan for the compensation of
management, employees or consultants of Holdings or any of its Subsidiaries, or
any arrangement for the benefit of management, employees or consultants of
Holdings or any of its Subsidiaries, in form and substance reasonably acceptable
to Agent.
"Environmental Claims" shall have the meaning provided in the
Environmental Indemnity Agreement.
"Environmental Indemnity Agreement" shall have the meaning
provided in Section 5.08.
"Environmental Law" shall have the meaning provided in the
Environmental Indemnity Agreement.
"Equity Issuance" shall have the meaning provided in Section
5.07(b).
"Equity Issuance Documents" shall mean the documents entered
into or delivered in connection with the Equity Issuance.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the Closing Date and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with Holdings or any Subsidiary of
Holdings would be deemed to be a "single employer" (i) within the meaning of
Section 414(b), (c), (m) or (o) of the Code or (ii) as a result of Holdings or a
Subsidiary of Holdings being or having been a general partner of such person.
"Eurodollar Loan" shall mean each Loan designated as such by
the Borrower at the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean (i) the offered quotation to
first-class banks in the New York interbank Eurodollar market by BTCo for Dollar
deposits of amounts in immediately available funds comparable to the outstanding
principal amount of the Eurodollar Loan of BTCo with maturities comparable to
the Interest Period applicable to such Eurodollar Loan commencing two Business
Days thereafter as of 10:00 A.M. (New York time) on the date which is two
Business Days prior to the commencement of such Interest Period, divided (and
rounded off to the nearest 1/16 of 1%) by (ii) a percentage equal to 100% minus
the then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other
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reserves required by applicable law) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency funding or liabilities as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"Event of Default" shall have the meaning provided in Section
10.
"Excess Cash Flow" shall mean, for any period, the remainder
of (a) the sum of (i) Adjusted Consolidated Net Income for such period and (ii)
the decrease, if any, in Adjusted Consolidated Working Capital from the first
day to the last day of such period, minus (b) the sum of (i) the amount of
Capital Expenditures made by the Borrower and its Subsidiaries on a consolidated
basis during such period pursuant to and in accordance with Sections 9.07(a),
(b), (c) and (d), except to the extent financed with the proceeds of
Indebtedness or pursuant to Capitalized Lease Obligations, (ii) the aggregate
amount of permanent principal payments of Indebtedness for borrowed money of the
Borrower and its Subsidiaries and the permanent repayment of the principal
component of Capitalized Lease Obligations of the Borrower and its Subsidiaries
(excluding (1) payments with proceeds of asset sales and (2) payments of Loans
or other Obligations, provided that repayments of Loans shall be deducted in
determining Excess Cash Flow if such repayments were (x) required as a result of
a Scheduled Repayment under Section 4.02(b) (but not as a reduction to the
amount of Scheduled Repayments pursuant to another provision of this Agreement)
or (y) made as a voluntary prepayment pursuant to Section 4.01 with internally
generated funds (but in the case of a voluntary prepayment of Revolving Loans,
only to the extent accompanied by a voluntary reduction to the Total Revolving
Loan Commitment)) during such period, (iii) Dividends paid by Holdings in
compliance with the terms of this Agreement, (iv) the principal amount of loans
and advances made by the Borrower and its Subsidiaries pursuant to Section
9.05(iii), (v) the increase, if any, in Adjusted Consolidated Working Capital
from the first day to the last day of such period, (vi) the increase, if any, in
long-term barter credits, as consistently maintained in the financial records of
the Borrower and (vii) the amount of deposits made in connection with Other
Hedging Agreements permitted under Section 9.05(xiii).
"Excess Cash Payment Date" shall mean the date occurring 90
days after the last day of each Fiscal Year (beginning with the Fiscal Year
ended December 31, 1998).
"Excess Cash Payment Period" shall mean with respect to the
repayment required on each Excess Cash Payment Date, the immediately preceding
Fiscal Year of the Borrower.
"Existing Atrium Credit Agreement" shall have the meaning set
forth in the recitals to this Agreement.
"Existing Credit Agreement" shall mean the Revolving Credit
and Term Loan Agreement, dated as of July 3, 1995, as amended from time to time
and as further amended by a Fourth Amendment to Revolving Credit and Term Loan
Agreement dated as of September 30, 1996, by and among Fojtasek Companies, Inc.,
Vinyl Building Specialties of Connecticut, Inc., Bishop
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Manufacturing Company, Inc., Bishop Manufacturing Company of New England, Inc.,
Bishop Manufacturing Co. of New York, Inc., the lending institutions named
therein (the "Lenders") and The First National Bank of Boston, as Agent for the
Lenders.
"Existing Debt Agreements" shall have the meaning provided in
Section 5.06.
"Existing Indebtedness" shall have the meaning provided in
Section 7.21.
"Facing Fee" shall have the meaning provided in Section
3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next 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 for such day on such
transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by the Agent.
"Fees" shall mean all amounts payable pursuant to or referred
to in Section 3.01.
"Financial Advisory Agreement" shall mean that certain
Financial Advisory Agreement dated as of November 27, 1996 among Holdings, the
Borrower and Hicks, Muse & Co. Partners, L.P., a Texas limited partnership in
the form delivered to the Agent on or prior to the Restatement Date without
giving effect to any modification that adversely effects the interests of the
Banks (including, without limitation, with respect to costs and liabilities)
without the consent of Required Banks.
"FIRREA" shall mean Financial Institution Reform, Recovery and
Enforcement Act of 1989.
"Fiscal Year" shall mean any fiscal year of Holdings or the
Borrower, as the case may be.
"GAAP" shall have the meaning provided in Section 13.07(a).
"Guaranteed Creditors" shall mean and include each of the
Agent, the Collateral Agent, the Banks and each party (other than any Credit
Party) party to an Interest Rate Protection Agreement or Other Hedging Agreement
to the extent such party constitutes a Secured Creditor under the Security
Documents.
"Guaranteed Obligations" shall mean all obligations of the
Borrower (i) to each Bank for the full and prompt payment when due (whether at
the stated maturity, by acceleration or otherwise) of the principal and interest
on each Note issued by the Borrower to such Bank, and Loans made, under this
Agreement and all reimbursement obligations and Unpaid Drawings with respect to
Letters of Credit, together with all the other obligations and liabilities
(including, without
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limitation, indemnities, Fees and interest thereon) of the Borrower to such Bank
now existing or hereafter incurred under, arising out of or in connection with
this Agreement or any other Credit Document and the due performance and
compliance with all the terms, conditions and agreements contained in the Credit
Documents by the Borrower and (ii) to each Bank and each Affiliate of a Bank
which enters into an Interest Rate Protection and Other Hedging Agreements with
the Borrower, the full and prompt payment when due (whether by acceleration or
otherwise) of all obligations of the Borrower owing under any such Interest
Rate Protection and Other Hedging Agreements, whether now in existence or
hereafter arising, and the due performance and compliance with all terms,
conditions and agreements contained therein.
"Guarantor" shall mean Holdings, FCI Holding and each
Subsidiary Guarantor.
"Guaranty" shall mean and include each of the Holdings
Guaranty, the FCI Guaranty and the Subsidiary Guaranty.
"Hazardous Materials" shall have the meaning provided in the
Environmental Indemnity Agreement.
"HM Group" shall mean, collectively, (i) Hicks, Muse, Tate &
Furst Incorporated and its Affiliates (including, without limitation, HMTF),
(ii) so long as Hicks, Muse, Tate & Furst Incorporated and its Affiliates
possess sole voting right with respect to the capital stock held by each such
individual, such individuals who are or were employees, officers, directors or
partners of Hicks, Muse, Tate & Furst Incorporated or such Affiliate and the
family members of such individuals or trusts created for the sole benefit of
such family members and (iii) so long as Hicks, Muse, Tate & Furst Incorporated
and its Affiliates possess sole voting right with respect to the capital stock
held by each such Person, any Person not otherwise described by clause (i) and
(ii) above, provided that the aggregate number of shares held by all such
Persons in accordance with this clause (iii) at any time shall not exceed 5.0%
of the aggregate number of shares held by the Persons described in clause (i)
and (ii) above at such time.
"HMTF" shall mean Hicks, Muse, Tate & Furst Equity Fund III,
L.P., a Delaware limited partnership.
"Holdings" shall have the meaning provided in the preamble of
this Agreement.
"Holdings Common Stock" shall mean the common stock of
Holdings.
"Holdings Guaranty" shall mean the guaranty issued pursuant to
Section 14 herein.
"Indebtedness" shall mean, as to any Person, without
duplication, (i) all indebtedness (including principal, interest, fees and
charges) of such Person for borrowed money or for the deferred purchase price of
property or services, (ii) the maximum amount available to be drawn under all
letters of credit issued for the account of such Person and all unpaid drawings
in respect of such letters of credit, (iii) all Indebtedness of the types
described in clause (i), (ii), (iv), (v), (vi)
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or (vii) of this definition secured by any Lien on any property owned by such
Person, whether or not such Indebtedness has been assumed by such Person (to the
extent of the value of the respective property), (iv) the aggregate amount
required to be capitalized under leases under which such Person is the lessee,
(v) all obligations of such person to pay a specified purchase price for goods
or services, whether or not delivered or accepted, i.e., take-or-pay and similar
obligations, (vi) all Contingent Obligations of such Person and (vii) all
obligations under any Interest Rate Protection Agreement and Other Hedging
Agreements or under any similar type of agreement.
"Initial Borrowing Date" shall mean the date on which the
initial Borrowing of Revolving Loans hereunder occurred (i.e., the Closing
Date).
"Initial Public Offering" shall mean an underwritten public
offering of common stock of Holdings pursuant to a registration statement filed
with the Securities and Exchange Commission in accordance with the Securities
Act, which public equity offering results in gross proceeds to Holdings of not
less than $25,000,000; provided, however, that Holdings contributes to the
capital of the Borrower the net cash proceeds from such underwritten public
offering.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section
1.09.
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement, interest collar agreement,
interest rate hedging agreement, interest rate floor agreement or other similar
agreement or arrangement.
"Issuing Bank" shall mean BTCo and any Bank which at the
request of the Borrower and with the consent of the Agent agrees, in such Bank's
sole discretion, to become an Issuing Bank for the purpose of issuing Letters of
Credit pursuant to Section 2. The sole Issuing Bank on the Initial Borrowing
Date is BTCo.
"L/C Supportable Obligations" shall mean (i) obligations of
the Borrower or its Subsidiaries incurred in the ordinary course of business
with respect to insurance obligations and workers' compensation, surety bonds
and other similar statutory obligations and (ii) such other obligations of the
Borrower or any of its Subsidiaries as are reasonably acceptable to the
respective Issuing Bank and otherwise permitted to exist pursuant to the terms
of this Agreement.
"Leaseholds" of any Person means all the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 3.01(b).
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"Letter of Credit Outstandings" shall mean, at any time, the
sum of (i) the aggregate Stated Amount of all outstanding Letters of Credit and
(ii) the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in
Section 2.02(a).
"Leverage Ratio" shall mean, at any date of determination, the
ratio of Consolidated Indebtedness on such date to Consolidated EBITDA for the
Test Period most recently ended (taken as one accounting period) and ending on
such date.
"Lien" shall mean any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other),
preference, priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any financing or similar statement or notice filed under
the UCC or any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Term Loan and each Revolving Loan.
"Majority Banks" of any Tranche shall mean those
Non-Defaulting Banks which would constitute the Required Banks under, and as
defined in, this Agreement if all outstanding Obligations of the other Tranches
under this Agreement were repaid in full and all Commitments with respect
thereto were terminated.
"Management Agreements" shall have the meaning provided in
Section 5.05.
"Margin Stock" shall have the meaning provided in Regulation
U.
"Masterview California" shall mean Masterview of California,
Inc., a California corporation and a direct Wholly-Owned Subsidiary of Atrium
Arizona.
"Masterview Window" shall mean Masterview Window Company LLC,
a Delaware limited liability company.
"Material Adverse Effect" shall mean a material adverse effect
on the business, operations, property, assets, liabilities, condition (financial
or otherwise) or prospects of the Borrower, Holdings and its Subsidiaries taken
as a whole or the Borrower and its Subsidiaries taken as a whole.
"Maturity Date" shall mean, with respect to any Tranche of
Loans, the Term Loan Maturity Date or the Revolving Loan Maturity Date, as the
case may be.
"Monitoring Agreement" shall mean that certain Monitoring and
Oversight Agreement dated as of November 27, 1996, among Holdings, the Borrower
and Hicks, Muse & Co. Partners, L.P., a Texas limited partnership in the form
delivered to the Agent on or prior to the Initial
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Borrowing Date without giving effect to any modification that adversely effects
the interests of the Banks (including, without limitation, with respect to costs
and liabilities) without the consent of Required Banks.
"Mortgage Policies" shall have the meaning provided in Section
5.11(b).
"Mortgaged Properties" shall have the meaning provided in
Section 5.11(a) and, after the execution and delivery of any Additional
Mortgage, shall include the respective Additional Mortgaged Property.
"Mortgages" shall have the meaning provided in Section 5.11(a)
and, after the execution and delivery thereof, shall include each Additional
Mortgage.
"Net Sale Proceeds" shall mean for any sale of assets, the
gross cash proceeds (including any cash received by way of deferred payment
pursuant to a promissory note, receivable or otherwise, but only as and when
received) received from any sale of assets, net of reasonable transaction costs
(including, without limitation, any underwriting, brokerage or other customary
selling commissions and reasonable legal, advisory and other fees and expenses,
including title and recording expenses, associated therewith) and payments of
unassumed liabilities relating to the assets sold at the time of, or within 30
days after, the date of such sale, the amount of such gross cash proceeds
required to be used to repay any Indebtedness (other than Indebtedness of the
Banks pursuant to this Agreement) which is secured by the respective assets
which were sold, and the estimated marginal increase in income taxes which will
be payable by Holdings' consolidated group with respect to the fiscal year in
which the sale occurs as a result of such sale; but excluding any portion of any
such gross cash proceeds which Holdings determines in good faith should be
reserved for post-closing adjustments (to the extent Holdings delivers to the
Banks a certificate signed by its chief financial officer, controller or chief
accounting officer as to such determination), it being understood and agreed
that on the day that all such post-closing adjustments have been determined,
(which shall not be later than six months following the date of the respective
asset sale), the amount (if any) by which the reserved amount in respect of such
sale or disposition exceeds the actual post-closing adjustments payable by
Holdings or any of its Subsidiaries shall constitute Net Sale Proceeds on such
date received by Holdings and/or any of its Subsidiaries from such sale, lease,
transfer or other disposition.
"Non-Defaulting Bank" shall mean and include each Bank other
than a Defaulting Bank.
"Note" shall mean each Term Note and each Revolving Note.
"Notice of Borrowing" shall have the meaning provided in
Section 1.03(a).
"Notice of Conversion" shall have the meaning provided in
Section 1.06.
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"Notice Office" shall mean the office of the Agent located at
130 Liberty Street, 30th Floor, New York, New York 10006, Attention: Mary Kay
Coyle, or such other office as the Agent may hereafter designate in writing as
such to the other parties hereto.
"Obligations" shall mean all amounts owing to the Agent, the
Collateral Agent or any Bank pursuant to the terms of this Agreement or any
other Credit Document.
"Options Repurchase" shall have the meaning provided in
Section 5.07(d).
"Options Repurchase Documents" shall mean the documents
entered into or delivered in connection with the Options Repurchase.
"Other Hedging Agreement" shall mean any foreign exchange
contracts, currency swap agreements, commodity agreements or other similar
agreements or arrangements designed to protect against the fluctuations in
values.
"Participant" shall have the meaning provided in Section
2.03(a).
"Payment Office" shall mean the office of the Agent located at
130 Liberty Street, New York, New York 10006, or such other office as the Agent
may hereafter designate in writing as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" of any Bank at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Revolving Loan
Commitment of such Bank at such time and the denominator of which is the Total
Revolving Loan Commitment at such time, provided that if the Percentage of any
Bank is to be determined after the Total Revolving Loan Commitment has been
terminated, then the Percentages of the Banks shall be determined immediately
prior (and without giving effect) to such termination.
"Permitted Acquisition" shall have the meaning provided in
Section 9.02(xiii).
"Permitted Encumbrance" shall mean, with respect to any
Mortgaged Property, such exceptions to title as are set forth in the title
insurance policy or title commitment delivered with respect thereto, all of
which exceptions must be acceptable to the Agent in its reasonable discretion.
"Permitted Investors" shall mean the collective reference to
Hicks, Muse, Tate & Furst Incorporated and its Affiliates.
"Permitted Liens" shall have the meaning provided in Section
9.01.
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"Person" shall mean any individual, partnership, limited
liability company, joint venture, firm, corporation, association, trust or other
enterprise or any government or political subdivision or any agency, department
or instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan,
as defined in Section 4001 of ERISA, which is maintained or contributed to by
(or to which there is an obligation to contribute of), the Borrower or a
Subsidiary of the Borrower or an ERISA Affiliate, and each such plan for the
five year period immediately following the latest date on which the Borrower, a
Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed or had
an obligation to contribute to such plan.
"Pledge Agreement" shall have the meaning provided in Section
5.12.
"Pledge Agreement Collateral" shall mean all "Collateral" as
defined in the Pledge Agreement.
"Pledged Securities" shall mean "Pledged Securities" as
defined in the Pledge Agreement.
"Preferred Stock Redemption" shall have the meaning provided
in Section 5.06(e).
"Preferred Stock Redemption Documents" shall mean the
documents entered into or delivered in connection with the Preferred Stock
Redemption, including, without limitation, the certificate of designation.
"Prime Lending Rate" shall mean the rate which BTCo announces
from time to time as its prime lending rate, the Prime Lending Rate to change
when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BTCo may make commercial loans or other loans
at rates of interest at, above or below the Prime Lending Rate.
"Projections" shall have the meaning provided in Section
7.05(d).
"Quarterly Payment Date" shall mean the fifteenth Business Day
of each January, April, July and October occurring after the Initial Borrowing
Date.
"Real Property" of any Person shall mean all the right, title
and interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recapitalization" shall mean, collectively, (i) the Equity
Issuance, (ii) the Stock Redemption, (iii) the Options Repurchase, (iv) the
Preferred Stock Redemption and (v) the issuance and sale of the Senior
Subordinated Notes.
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"Recapitalization Documents" shall mean the Stock Purchase
Agreement, the Equity Issuance Documents, the Stock Redemption Documents, the
Options Repurchase Documents, the Preferred Stock Redemption Documents and the
Senior Subordinated Note Documents.
"Recovery Event" shall mean the receipt by Holdings or any of
its Subsidiaries of any cash insurance proceeds or condemnation award payable
(i) by reason of theft, loss, physical destruction or damage or any other
similar event with respect to any property or assets of the Borrower or any of
its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Redeemable Preferred Stock" shall have the meaning provided
in Section 5.06(e).
"Redeemed Options" shall mean the options held by the Selling
Optionholders to purchase Holdings Common Stock and redeemed pursuant to Stock
Purchase Agreement.
"Redeemed Shares" shall mean the shares of Holdings Common
Stock redeemed pursuant to Stock Purchase Agreement.
"Refinancing" shall mean the termination of the commitments
under the Existing Credit Agreement and the repayment of all loans and other
obligations outstanding thereunder.
"Register" shall have the meaning provided in Section 13.17.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof.
"Regulation T" shall mean Regulation T of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof.
"Reinvestment Assets" shall mean any assets to be employed in
the business of the Borrower and its Subsidiaries in compliance with this
Agreement.
"Reinvestment Election" shall have the meaning provided in
Section 4.02(d).
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"Reinvestment Notice" shall mean a written notice signed by an
Authorized Officer of the Borrower stating that the Borrower, in good faith,
intends and expects to use all or a specified portion of Net Sale Proceeds of
asset sales to purchase, construct or otherwise acquire Reinvestment Assets.
"Reinvestment Prepayment Amount" shall mean, with respect to
any Reinvestment Election, the amount, if any, on the Reinvestment Prepayment
Date relating thereto by which (i) the Anticipated Reinvestment Amount in
respect of such Reinvestment Election exceeds (ii) the aggregate amount thereof
expended by the Borrower and its Subsidiaries to acquire Reinvestment Assets.
"Reinvestment Prepayment Date" shall mean, with respect to any
Reinvestment Election, the earliest of (i) the date, if any, upon which the
Agent, on behalf of the Required Banks, shall have delivered a written
termination notice to the Borrower, provided that such notice may only be given
while an Event of Default exists, (ii) the date occurring one year after such
Reinvestment Election and (iii) the date on which the Borrower shall have
determined not to, or shall have otherwise ceased to, proceed with the purchase,
construction or other acquisition of Reinvestment Assets with the related
Anticipated Reinvestment Amount.
"Release" shall have the meaning provided in the Environmental
Indemnity Agreement.
"Replaced Bank" shall have the meaning provided in Section
1.13.
"Replacement Bank" shall have the meaning provided in Section
1.13.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan other than those events as to which the
30-day notice period is waived under subsection .13, .14, .16, .18, .19 or .20
of PBGC Regulation Section 2615.
"Required Appraisal" shall have the meaning provided in
Section 8.10(d).
"Required Banks" shall mean Non-Defaulting Banks, the sum of
whose outstanding Term Loans (or, if prior to the Restatement Date, Term Loan
Commitments) and Revolving Loan Commitments (or after the termination thereof,
outstanding Revolving Loans and Adjusted Percentage of Letter of Credit
Outstandings) represent an amount greater than 50% of the sum of all outstanding
Term Loans (or, if prior to the Restatement Date, Term Loan Commitments) of
Non-Defaulting Banks and the Adjusted Total Revolving Loan Commitment (or after
the termination thereof, the sum of the then total outstanding Revolving Loans
of Non-Defaulting Banks and the aggregate Adjusted Percentages of all
Non-Defaulting Banks of the total outstanding Letter of Credit Outstandings at
such time).
"Restatement Date" shall have the meaning provided in the
recitals to this Agreement.
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"Returns" shall have the meaning provided in Section 7.09.
"Revolving Loan" shall have the meaning provided in Section
1.01(c).
"Revolving Loan Commitment" shall mean, for each Bank, the
amount set forth opposite such Bank's name in Schedule I attached hereto
directly below the column entitled "Revolving Loan Commitment," as same may be
(x) reduced from time to time pursuant to Sections 3.02, 3.03, 4.02 and/or 10 or
(y) adjusted from time to time as a result of assignments to or from such Bank
pursuant to Section 1.13 or 13.04(b).
"Revolving Loan Maturity Date" shall mean March 31, 2004.
"Revolving Note" shall have the meaning provided in Section
1.05(a).
"SBA Loan" shall mean the Indebtedness and all other
obligations evidenced by that certain Note, dated June 9, 1993, in the original
principal amount of $206,000, executed by Bishop Manufacturing Company of New
England, Inc. and payable to the Massachusetts Certified Development Corp., as
subsequently assigned to the U.S. Small Business Administration, and guaranteed
by Fojtasek Companies, Inc., FCI Holding Corp., Vinyl Building Specialties of
Connecticut, Inc. and Bishop Manufacturing Company, Inc.
"Scheduled Repayment" shall have the meaning provided in
Section 4.02(b)(i).
"Scheduled Repayment Date" shall have the meaning provided in
Section 4.02(b)(i).
"SEC" shall have the meaning provided in Section 8.01(g).
"Section 4.04(b)(iii) Certificate" shall have the meaning
provided in Section 4.04(b)(iii).
"Secured Creditors" shall have the meaning assigned that term
in the Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Security Agreement" shall have the meaning provided in
Section 5.13.
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Security Agreement.
"Security Document" shall mean the Pledge Agreement, Security
Agreement, the Mortgages and, after the execution and delivery thereof, each
Additional Mortgage and each Additional Security Document, in each case as the
same may be amended, restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof and hereof.
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"Selling Optionholders" shall mean the "Option Holders" under,
and as defined in, the Stock Purchase Agreement.
"Selling Shareholders" shall mean the "Stockholders" under,
and as defined in, the Stock Purchase Agreement.
"Senior Subordinated Note Documents" shall mean and include
each of the documents and other agreements entered into (including, without
limitation, the Senior Subordinated Note Indenture) relating to the issuance by
the Borrower of the Senior Subordinated Notes, as in effect on the Closing Date
(to the extent thereof) and as the same may be entered into, modified,
supplemented or amended from time to time pursuant to the terms hereof and
thereof.
"Senior Subordinated Note Indenture" shall mean the Indenture
entered into by and among the Borrower, each of the Subsidiary Guarantors and
United States Trust Company of New York, as trustee thereunder, as in effect on
the Initial Borrowing Date and as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms hereof and thereof.
"Senior Subordinated Notes" shall mean the Borrower's 12.50%
Senior Subordinated Notes due 2006, as in effect on the Closing Date and as the
same may be amended, restated, supplemented or otherwise modified from time to
time pursuant to the terms hereof and thereof.
"Shareholders' Agreements" shall have the meaning provided in
Section 5.06.
"Standby Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Stated Amount" of each Letter of Credit shall, at any time,
mean the maximum amount available to be drawn thereunder (in each case
determined without regard to whether any conditions to drawing could then be
met).
"Stock Purchase Agreement" shall mean the Stock Purchase
Agreement, dated as of November 7, 1996, by and among HMTF Acquisition Corp.,
Holdings and the holders of capital stock and options to purchase capital stock
named therein, as in effect on the Initial Borrowing Date.
"Stock Redemption" shall have the meaning provided in Section
5.07(c).
"Stock Redemption Documents" shall mean the documents entered
into or delivered in connection with the Stock Redemption.
"Subsidiary" shall mean, as to any Person, (i) any corporation
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries
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of such Person and (ii) any partnership, limited liability company, association,
joint venture or other entity in which such Person and/or one or more
Subsidiaries of such Person has more than a 50% equity interest at the time.
"Subsidiary Guarantor" shall mean each Subsidiary of the
Borrower (other than Masterview California) that is or becomes a party to the
Subsidiary Guaranty.
"Subsidiary Guaranty" shall have the meaning provided in
Section 5.14.
"Supermajority Banks" of any Tranche shall mean those
Non-Defaulting Banks which would constitute the Required Banks under, and as
defined in, this Agreement if (x) all outstanding Obligations of the other
Tranches under this Agreement were repaid in full and all Commitments with
respect thereto were terminated and (y) the percentage "50%" contained therein
were changed to "66-2/3%."
"Syndication Date" shall mean that date upon which the Agent
determines in its sole discretion (and notifies the Borrower) that the primary
syndication (and resultant addition of institutions as Banks pursuant to Section
13.04) has been completed.
"Syndication Period" shall have the meaning provided in
Section 1.01(a).
"Tax Sharing Agreement" shall have the meaning provided in
Section 5.05.
"Taxes" shall have the meaning provided in Section 4.04(a).
"Term Loan" shall have the meaning provided in Section
1.01(b).
"Term Loan Commitment" shall mean, for each Bank, the amount
set forth opposite such Bank's name in Schedule I directly below the column
entitled "Term Loan Commitment," as the same may be (x) reduced from time to
time pursuant to Sections 3.03, 4.02 and/or 10 or (y) adjusted from time to time
as a result of assignments to or from such Bank pursuant to Section 1.13 or
13.04(b).
"Term Loan Maturity Date" shall mean March 31, 2004.
"Term Note" shall have the meaning provided in Section
1.05(a).
"Test Period" shall mean, for any date of determination, the
four consecutive fiscal quarters then last ended (taken as one accounting
period).
"Total Commitments" shall mean, at any time, the sum of the
Commitments of each of the Banks.
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"Total Revolving Loan Commitment" shall mean, at any time, the
sum of the Revolving Loan Commitments of each of the Banks.
"Total Term Loan Commitments" shall mean, at any time, the sum
of the Term Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at
any time, an amount equal to the remainder of (i) the then Total Revolving Loan
Commitment, minus (ii) the sum of the aggregate principal amount of Revolving
Loans plus the then aggregate amount of Letter of Credit Outstandings.
"Trade Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Tranche" shall mean the respective facility and commitments
utilized in making Loans hereunder, with their being two separate Tranches,
i.e., Term Loans and Revolving Loans.
"Transaction" shall mean, collectively, the Recapitalization
and the Refinancing.
"Type" shall mean the type of Loan determined with regard to
the interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to
time in effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan means the amount, if
any, by which the actuarial present value of the accumulated benefits under the
Plan as of the close of its most recent plan year, determined in accordance with
Statement of Financial Accounting Standards No. 87, based upon the actuarial
assumptions used by the Plan's actuary in the most recent annual valuation of
the Plan, exceeds the fair market value of the assets allocable thereto,
determined in accordance with Section 412 of the Code.
"United States" and "U.S." shall each mean the United States
of America.
"Unpaid Drawing" shall have the meaning provided for in
Section 2.04(a).
"Unutilized Revolving Loan Commitment" with respect to any
Bank, at any time, shall mean such Bank's Revolving Loan Commitment at such time
less the sum of (i) the aggregate outstanding principal amount of Revolving
Loans made by such Bank and (ii) such Bank's Adjusted Percentage of the Letter
of Credit Outstandings in respect of Letters of Credit issued under this
Agreement.
"Weighted Average Life to Maturity" shall mean, when applied
to any Indebtedness at any date, the number of years obtained by dividing (i)
the then outstanding principal amount of such Indebtedness into (ii) the total
of the product obtained by multiplying (A) the amount of each
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then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof
by (B) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i)
any corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
SECTION 12. THE AGENT.
12.01 Appointment. The Banks hereby designate Bankers Trust
Company as Agent (for purposes of this Section 12, the term "Agent" shall
include BTCo in its capacity as Collateral Agent pursuant to the Security
Documents) to act as specified herein and in the other Credit Documents. Each
Bank hereby irrevocably authorizes, and each holder of any Revolving Note by the
acceptance of such Revolving Note shall be deemed irrevocably to authorize, the
Agent to take such action on its behalf under the provisions of this Agreement,
the other Credit Documents and any other instruments and agreements referred to
herein or therein and to exercise such powers and to perform such duties
hereunder and thereunder as are specifically delegated to or required of the
Agent by the terms hereof and thereof and such other powers as are reasonably
incidental thereto. The Agent may perform any of its duties hereunder by or
through its respective officers, directors, agents, employees or affiliates.
12.02 Nature of Duties. The Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement and the
other Credit Documents. Neither the Agent nor any of its respective officers,
directors, agents, employees or affiliates shall be liable for any action taken
or omitted by it or them hereunder or under any other Credit Document or in
connection herewith or therewith, unless caused by its or their gross negligence
or willful misconduct. The duties of the Agent shall be mechanical and
administrative in nature; the Agent shall not have by reason of this Agreement
or any other Credit Document a fiduciary relationship in respect of any Bank or
the holder of any Revolving Note; and nothing in this Agreement or any other
Credit Document, expressed or implied, is intended to or shall be so construed
as to impose upon the Agent any obligations in respect of this Agreement or any
other Credit Document except as expressly set forth herein or therein.
12.03 Lack of Reliance on the Agent. Independently and without
reliance upon the Agent, each Bank and the holder of each Note, to the extent it
deems appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of Holdings and its
Subsidiaries in connection with the making and the continuance of the Loans and
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the credit worthiness of Holdings and its Subsidiaries and, except
as expressly provided in this Agreement, the Agent shall not have any duty or
responsibility, either initially or on a continuing basis, to pro vide any Bank
or the holder of any Note with any credit or other information with respect
thereto,
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whether coming into its possession before the making of the Loans or at any time
or times thereafter. The Agent shall not be responsible to any Bank or the
holder of any Note for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforce ability, perfection, collectibility, priority or sufficiency of this
Agreement or any other Credit Document or the financial condition of Holdings
and its Subsidiaries or be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Agreement or any other Credit Document, or the financial condition of Holdings
and its Subsidiaries or the existence or possible existence of any Default or
Event of Default.
12.04 Certain Rights of the Agent. If the Agent shall request
instructions from the Required Banks with respect to any act or action
(including failure to act) in connection with this Agreement or any other Credit
Document, the Agent shall be entitled to refrain from such act or taking such
action unless and until the Agent shall have received instructions from the
Required Banks; and the Agent shall not incur liability to any Person by reason
of so refraining. Without limiting the foregoing, no Bank or the holder of any
Note shall have any right of action whatsoever against the Agent as a result of
the Agent acting or refraining from acting hereunder or under any other Credit
Document in accordance with the instructions of the Required Banks.
12.05 Reliance. The Agent shall be entitled to rely, and shall
be fully protected in relying, upon any Note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
any Person that the Agent believed to be the proper Person, and, with respect to
all legal matters pertaining to this Agreement and any other Credit Document and
its duties hereunder and thereunder, upon advice of counsel selected by the
Agent (which may be counsel for the Credit Parties).
12.06 Indemnification. To the extent the Agent is not
reimbursed and indemnified by the Borrower, the Banks will reimburse and
indemnify the Agent, in proportion to their respective "percentages" as used in
determining the Required Banks, for and against any and all liabilities,
obligations, losses, damages, penalties, claims, actions, judgments, costs,
expenses or disbursements of whatsoever kind or nature which may be imposed on,
asserted against or incurred by the Agent in performing its respective duties
hereunder or under any other Credit Document, in any way relating to or arising
out of this Agreement or any other Credit Document, provided that no Bank shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Agent's gross negligence or willful misconduct.
12.07 The Agent in its Individual Capacity. With respect to
its obligation to make Loans under this Agreement, the Agent shall have the
rights and powers specified herein for a "Bank" and may exercise the same rights
and powers as though it were not performing the duties specified herein; and the
term "Banks," "Required Banks," "holders of Notes" or any similar terms shall,
unless the context clearly otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of banking, trust
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or other business with any Credit Party or any Affiliate of any Credit Party as
if they were not performing the duties specified herein, and may accept fees and
other consideration from the Borrower or any other Credit Party for services in
connection with this Agreement and otherwise without having to account for the
same to the Banks.
12.08 Holders. The Agent may deem and treat the payee of any
Note as the owner thereof for all purposes hereof unless and until a written
notice of the assignment, transfer or endorsement thereof, as the case may be,
shall have been filed with the Agent. Any request, authority or consent of any
Person who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee, assignee or indorsee, as the case may be, of such
Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Agent. (a) The Agent may resign from
the performance of all its functions and duties hereunder and/or under the other
Credit Documents at any time by giving 15 Business Days' prior written notice to
the Borrower and the Banks. Such resignation shall take effect upon the
appointment of a successor Agent pursuant to clauses (b) and (c) below or as
otherwise provided below.
(b) Upon any such notice of resignation, the Banks shall
appoint a successor Agent hereunder or thereunder who shall be a commercial bank
or trust company reasonably accept able to the Borrower.
(c) If a successor Agent shall not have been so appointed
within such 15 Business Day period, the Agent, with the consent of the Borrower,
shall then appoint a commercial bank or trust company with capital and surplus
of not less than $500,000,000 as successor Agent who shall serve as Agent
hereunder or thereunder until such time, if any, as the Banks appoint a
successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to
clause (b) or (c) above by the 20th Business Day after the date such notice of
resignation was given by the Agent, the Agent's resignation shall become
effective and the Required Banks shall thereafter perform all the duties of the
Agent hereunder and/or under any other Credit Document until such time, if any,
as the Banks appoint a successor Agent as provided above.
SECTION 13. MISCELLANEOUS.
13.01 Payment of Expenses, etc. (a) The Borrower shall: (i)
whether or not the transactions herein contemplated are consummated, pay all
reasonable out-of-pocket costs and expenses of the Agent (including, without
limitation, the reasonable fees and disbursements of Winston & Strawn and local
counsel) in connection with the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and instruments
referred to here in and therein and any amendment, waiver or consent relating
hereto or thereto, of the Agent in connection with its syndication efforts with
respect to this Agreement and of the Agent and,
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following and during the continuation of an Event of Default, each of the Banks
in connection with the enforcement of this Agreement and the other Credit
Documents and the documents and instruments referred to herein and therein
(including, without limitation, the reasonable fees and disbursements of
counsel for the Agent and, following and during the continuation of an Event of
Default, for each of the Banks); (ii) pay and hold each of the Banks harmless
from and against any and all present and future stamp, excise and other similar
taxes with respect to the foregoing matters and save each of the Banks harmless
from and against any and all liabilities with respect to or resulting from any
delay or omission (other than to the extent attributable to such Bank) to pay
such taxes; and (iii) indemnify the Agent and each Bank, and each of their
respective officers, directors, employees, representatives and agents from and
hold each of them harmless against any and all liabilities, obligations
(including removal or remedial actions), losses, damages, penalties, claims,
actions, judgments, suits, costs, expenses and disbursements (including
reasonable attorneys' and consultants' fees and disbursements) incurred by,
imposed on or assessed against any of them as a result of, or arising out of, or
in any way related to, or by reason of, (A) any investigation, litigation or
other proceeding (whether or not the Agent or any Bank is a party thereto)
related to the entering into and/or performance of this Agreement or any other
Credit Document or the use of any Letter of Credit or the proceeds of any Loans
hereunder or the consummation of any transactions contemplated herein
(including, without limitation, the Transaction and the Acquisition) or in any
other Credit Document or the exercise of any of their rights or remedies
provided herein or in the other Credit Documents, or (B) the non-compliance of
any Real Property with foreign, federal, state and local laws, regulations, and
ordinances (including applicable permits thereunder) applicable to any Real
Property (excluding Environmental Laws which are governed by the Environmental
Indemnity Agreement) owned or at any time operated by Holdings or any of its
Subsidiaries, including, in each case, without limitation, the reasonable fees
and disbursements of counsel and other consultants incurred in connection with
any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). To the extent that the undertaking to indemnify, pay or hold
harmless the Agent or any Bank set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, the Borrower
shall make the maximum contribution to the payment and satisfaction of each of
the indemnified liabilities which is permissible under applicable law.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the indemnification provided for in this Section 13.01 shall not
apply to Environmental Claims, Hazardous Materials or Releases, all of which
shall be governed exclusively by the Environmental Indemnity Agreement.
13.02 Right of Setoff; Collateral Matters. In addition to any
rights now or hereafter granted under applicable law or otherwise, and not by
way of limitation of any such rights, upon the occurrence and during the
continuance of an Event of Default, each Bank is hereby authorized at any time
or from time to time, without presentment, demand, protest or other notice of
any kind to Holdings or the Borrower or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and apply any and
all deposits (general or special) and any other Indebtedness at any time held
or owing by such Bank (including, without limitation, by branches and
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agencies of such Bank wherever located) to or for the credit or the account of
Holdings, the Borrower or any other Credit Party against and on account of the
Obligations and liabilities of Holdings, the Borrower or such Credit Party to
such Bank under this Agreement or under any of the other Credit Documents,
including, without limitation, all interests in Obligations purchased by such
Bank pursuant to Section 13.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any other Credit
Document, irrespective of whether or not such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.
13.03 Notices. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to Holdings, at
Holdings' address specified opposite its signature below; if to FCI Holding, at
FCI Holding's address specified opposite its signature below; if to the
Borrower, at the Borrower's address specified opposite its signature below; if
to any Bank, at its address specified opposite its name on Schedule II attached
hereto; and if to the Agent, at its Notice Office; or, as to any Credit Party or
the Agent, at such other address as shall be designated by such party in a
written notice to the other parties hereto and, as to each Bank, at such other
address as shall be designated by such Bank in a written notice to the Borrower
and the Agent. All such notices and communications shall, when mailed,
telegraphed, telexed, telecopied, or cabled or sent by overnight courier, be
effective when deposited in the mails, delivered to the telegraph company, cable
company or overnight courier, as the case may be, or sent by telex or
telecopier, except that notices and communications to the Agent and the Borrower
shall not be effective until received by the Agent or the Borrower, as the case
may be.
13.04 Benefit of Agreement. (a) This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto; provided, however, that the
Borrower may not assign or transfer any of its rights, obligations or interest
hereunder without the prior written consent of the Banks; and provided further,
that, although any Bank may transfer, assign or grant participations in its
rights hereunder, such Bank shall remain a "Bank" for all purposes hereunder
(and may not transfer or assign all or any portion of its Commitments hereunder
except as provided in Section 13.04(b)) and the transferee, assignee or
participant, as the case may be, shall not constitute a "Bank" hereunder; and
provided further, that no Bank shall transfer or grant any participation under
which the participant shall have rights to approve any amendment to or waiver of
this Agreement or any other Credit Document except to the extent such amendment
or waiver would (i) extend the final scheduled maturity of any Loan, Note or
Letter of Credit (unless such Letter of Credit is not extended beyond the
Revolving Loan Maturity Date) in which such participant is participating, or
reduce the rate or extend the time of payment of interest or Fees thereon
(except in connection with a waiver of applicability of any post-default in
crease in interest rates) or reduce the principal amount thereof, or increase
the amount of the participant's participation over the amount thereof then in
effect (it being understood that waivers or modifications of conditions
precedent, covenants, Defaults or Events of Default or of a mandatory reduction
in the Total Commitments shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any
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participant if the participant's participation therein is not increased as a
result thereof), (ii) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement or (iii) release all or
substantially all of the Collateral under all of the Security Documents (except
as expressly provided in the Credit Documents) supporting the Loans hereunder in
which such participant is participating. In the case of any such participation,
the participant shall not have any rights under this Agreement or any of the
other Credit Documents (the participant's rights against such Bank in respect of
such participation to be those set forth in the agreement executed by such Bank
in favor of the participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Bank had not sold such
participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank
together with one or more other Banks) may (i) assign all or a portion of its
Revolving Loan Commitment (and related outstanding Obligations hereunder) and/or
its outstanding Term Loans (or, if prior to the Restatement Date, Term Loan
Commitment) to its parent company and/or any affiliate of such Bank which is at
least 50% owned by such Bank or its parent company or to one or more investment
funds under common management with such Bank or to one or more Banks or (ii)
assign all, or if less than all, a portion equal to at least $5,000,000 in the
aggregate for the assigning Bank or assigning Banks, of such Revolving Loan
Commitments (and related outstanding Obligations hereunder) and outstanding
principal amount of Term Loans (of, if prior to the Restatement Date, Term Loan
Commitment) hereunder to one or more Eligible Transferees, each of which
assignees shall become a party to this Agreement as a Bank by execution of an
Assignment and Assumption Agreement; provided, however, that, (A) at such time
Schedule I shall be deemed modified to reflect the Commitments (and/or
outstanding Term Loans, as the case may be) of such new Bank and of the existing
Banks, (B) new Notes will be issued, at the Borrower's expense, to such new Bank
and to the assigning Bank upon the request of such new Bank or assigning Bank,
such new Revolving Notes to be in conformity with the requirements of Section
1.05 (with appropriate modifications) to the extent needed to reflect the
revised Commitments (and/or outstanding Term Loans), (C) the consent of BTCo
shall be required in connection with any such assignment (which consent shall
not be unreasonably withheld), (D) so long as no Default or Event of Default has
occurred and is continuing, the consent of the Borrower shall be required in
connection with such assignment (which consent shall not be unreasonably
withheld or delayed), and (E) the Agent shall receive at the time of each such
assignment, from the assigning or assignee Bank, the payment of a non-refundable
assignment fee of $3,500; and provided further, that such transfer or assignment
will not be effective until recorded by the Agent on the Register pursuant to
Section 13.17. To the extent of any assignment pursuant to this Section
13.04(b), the assigning Bank shall be relieved of its obligations hereunder with
respect to its assigned Commitments. At the time of each assignment pursuant to
this Section 13.04(b) to a Person which is not already a Bank hereunder and
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Bank shall, to the extent legally entitled to do so, provide to the
Borrower in the case of a Bank described in clause (ii) or (iv) of Section
4.04(b), the forms described in such clause (ii) or (iv), as the case may be. To
the extent that an assignment of all or any portion of a Bank's Commitments and
related outstanding Obligations pursuant to Section 1.13 or this Section
13.04(b) would, at the time of such assignment, result in increased costs under
Section 1.10, 1.11 or 4.04 from those being charged by the respective assigning
Bank prior to such assignment,
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then the Borrower shall not be obligated to pay such increased costs (although
the Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
assignment).
(c) Nothing in this Agreement shall prevent or prohibit any
Bank from pledging its Loans and Notes hereunder to a Federal Reserve Bank in
support of borrowings made by such Bank from such Federal Reserve Bank.
13.05 No Waiver; Remedies Cumulative. No failure or delay on
the part of the Agent or any Bank or any holder of any Note in exercising any
right, power or privilege hereunder or under any other Credit Document and no
course of dealing between the Borrower or any other Credit Party and the Agent
or any Bank or the holder of any Note shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights, powers and remedies herein or in any other Credit
Document expressly provided are cumulative and not exclusive of any rights,
powers or remedies which the Agent or any Bank or the holder of any Note would
otherwise have. No notice to or demand on any Credit Party in any case shall
entitle any Credit Party to any other or further notice or demand in similar or
other circumstances or constitute a waiver of the rights of the Agent or any
Bank or the holder of any Note to any other or further action in any
circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in
this Agreement, the Agent agrees that promptly after its receipt of each payment
from or on behalf of the Borrower in respect of any Obligations hereunder, it
shall distribute such payment to the Banks (other than any Bank that has
consented in writing to waive its pro rata share of any such payment) pro rata
based upon their respective shares, if any, of the Obligations with respect to
which such payment was received.
(b) Each of the Banks agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees,
of a sum which with respect to the related sum or sums received by other Banks
is in a greater proportion than the total of such Obligation then owed and due
to such Bank bears to the total of such Obligation then owed and due to all of
the Banks immediately prior to such receipt, then such Bank receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Banks an interest in the Obligations of the respective Credit Party to
such Banks in such amount as shall result in a proportional participation by all
the Banks in such amount; provided, however, that if all or any portion of such
excess amount is thereafter recovered from such Bank, such purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but
without interest.
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(c) Notwithstanding anything to the contrary contained herein,
the provisions of the preceding Sections 13.06(a) and (b) shall be subject to
the express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
13.07 Calculations; Computations. (a) The financial statements
to be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to the
Banks); provided, however, that, except as otherwise specifically provided
herein, all computations determining compliance with Sections 9.07 through 9.10,
inclusive, shall utilize accounting principles and policies in conformity with
those used to prepare the historical financial statements delivered to the Banks
pursuant to Section 7.05(a) (with the foregoing generally accepted accounting
principles, subject to the preceding proviso, referred to herein as "GAAP").
(b) All computations of interest and Fees hereunder shall be
made on the basis of a year of 360 days for the actual number of days (including
the first day but excluding the last day) occurring in the period for which such
interest or Fees are payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (A) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS
OTHERWISE PROVIDED IN CERTAIN OF THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER HERE BY IRREVOCABLY
DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM, WITH OFFICES ON THE
DATE HEREOF AT 1633 BROADWAY, NEW YORK, NEW YORK 10019 AS ITS DESIGNEE,
APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF,
AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS,
NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. IF
FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO
ACT AS SUCH, EACH SUCH CREDIT PARTY AGREES TO DESIGNATE A NEW DESIGNEE,
APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS
PROVISION SATISFACTORY TO THE AGENT UNDER THIS AGREEMENT. EACH OF HOLDINGS AND
THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
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PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING
BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE
PREPAID, TO ANY CREDIT PARTY AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE
BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE AGENT UNDER THIS AGREEMENT, ANY BANK OR THE
HOLDER OF ANY REVOLVING NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY CREDIT
PARTY IN ANY OTHER JURISDICTION.
(b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED
TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Agent.
13.10 Intentionally Omitted.
13.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor
any other Credit Document nor any terms hereof or thereof may be changed,
waived, discharged or terminated unless such change, waiver, discharge or
termination is in writing signed by the respective Credit Parties party thereto
and the Required Banks, provided that no such change, waiver, discharge or
termination shall, without the consent of each Bank (other than a Defaulting
Bank) (with Obligations
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being directly affected thereby in the case of the following clause (i)), (i)
extend the final scheduled maturity of any Loan or any Note, or extend the
stated maturity of any Letter of Credit beyond the Revolving Loan Maturity Date,
or reduce the rate or extend the time of payment of interest or Fees thereon
(except in connection with a waiver of applicability of any post-default
increase in interest rates), or reduce the principal amount thereof (except to
the extent repaid in cash), (ii) release all or substantially all of the
Collateral (except as expressly provided in the Credit Documents) under all the
Security Documents, (iii) amend, modify or waive any provision of this Section
13.12, (iv) reduce the percentage specified in the definition of Required Banks
(it being understood that, with the consent of the Required Banks, additional
extensions of credit pursuant to this Agreement may be included in the
determination of the Required Banks on substantially the same basis as the Term
Loan Commitments and Revolving Loan Commitments (and related extensions of
credit) are included on the Restatement Date) or (v) consent to the assignment
or transfer by the Borrower of any of its rights and obligations under this
Agreement; provided further, that no such change, waiver, discharge or
termination shall (u) increase the Commitments of any Bank over the amount
thereof then in effect without the consent of such Bank (it being understood
that waivers or modifications of conditions precedent, covenants, Defaults or
Events of Default or of a mandatory reduction in the Total Commitments shall not
constitute an increase of the Commitment of any Bank, and that an increase in
the available portion of any Commitment of any Bank shall not constitute an
increase in the Commitment of such Bank), (v) without the consent of BTCo and
any other Issuing Bank, amend, modify or waive any provision of Section 2 or
alter its rights or obligations with respect to Letters of Credit issued by it,
(w) without the consent the Agent, amend, modify or waive any pro vision of
Section 12 as same applies to such Agent or any other provision as same relates
to the rights or obligations of the Agent, (x) without the consent of the
Collateral Agent, amend, modify or waive any provision relating to the rights or
obligations of the Collateral Agent, (y) without the consent of the Majority
Banks of each Tranche which is being allocated a lesser prepayment, repayment or
commitment reduction as a result of the actions described below (or without the
consent of the Majority Banks of each Tranche in the case of an amendment to the
definition of Majority Banks), amend the definition of Majority Banks or alter
the required application of any prepayments or repayments (or commitment
reductions), as between the various Tranches, pursuant to Section 4.01 or 4.02
(excluding Section 4.02(b)) (although the Required Banks may waive, in whole or
in part, any such prepayment, repayment or commitment reduction, so long as the
application, as amongst the various Tranches, of any such prepayment, repayment
or commitment reduction which is still required to be made is not altered) or
(z) without the consent of the Supermajority Banks of the respective Tranche,
amend the definition of Supermajority Banks or amend, modify or waive any
Scheduled Repayment.
(b) If, in connection with any proposed change, waiver,
discharge or termination with respect to any of the provisions of this Agreement
as contemplated by clauses (i) through (v), inclusive, of the first proviso to
Section 13.12(a), the consent of the Required Banks is obtained but the consent
of one or more of such other Banks whose consent is required is not obtained,
then the Borrower shall have the right, so long as all non-consenting Banks
whose individual consent is required are treated as described in either clause
(A) or (B) below, to either (A) replace each such non-consenting Bank or Banks
(or, at the option of the Borrower if the respective Bank's consent is required
with respect to less than all Tranches of Loans (or related Commitments), to
replace only
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the respective Tranche or Tranches of Commitments and/or Loans of the respective
non-consenting Bank which gave rise to the need to obtain such Bank's individual
consent) with one or more Replacement Banks pursuant to Section 1.13 so long as
at the time of such replacement, each such Replacement Bank consents to the
proposed change, waiver, discharge or termination or (B) terminate such
non-consenting Bank's Commitments and repay in full its outstanding Loans (or,
at the option of the Borrower if the respective Bank's consent is required with
respect to less than all Tranches of Loans (or related Commitments), to
terminate and repay only the respective Tranche or Tranches of Commitments
and/or Loans of the respective non-consenting Bank which gave rise to the need
to obtain such Bank's individual consent), in accordance with Sections 3.02(b)
and/or 4.01(v), provided that, unless the Commitments terminated and Loans
repaid pursuant to preceding clause (B) are immediately replaced in full at such
time through the addition of new Banks or the increase of the Commitments and/or
outstanding Loans of existing Banks (who in each case must specifically consent
thereto), then in the case of any action pursuant to preceding clause (B) the
Required Banks (determined before giving effect to the proposed action) shall
specifically consent thereto, provided further, that in any event the Borrower
shall not have the right to replace a Bank, terminate any of its Commitments or
repay its Loans solely as a result of the exercise of such Bank's rights (and
the withholding of any required consent by such Bank) pursuant to the second
proviso to Section 13.12(a).
13.13 Survival. All indemnities set forth herein including,
without limitation, in Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06 shall,
subject to Section 13.15 (to the extent applicable), survive the execution,
delivery and termination of this Agreement and the Notes, and any Letters of
Credit, and the making and repayment of the Loans (it being understood and
agreed that all such indemnities shall also survive as to any Bank that has
assigned all of its obligations hereunder pursuant to Section 13.04(b) with
respect to the period of time in which such Bank was a "Bank" hereunder).
13.14 Domicile of Loans. Each Bank may transfer and carry its
Loans at, to or for the account of any office, Subsidiary or Affiliate of such
Bank. Notwithstanding anything to the contrary contained herein, to the extent
that a transfer of Loans pursuant to this Section 13.14 would, at the time of
such transfer, result in increased costs under Section 1.10, 1.11, 2.05 or 4.04
from those being charged by the respective Bank prior to such transfer, then the
Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
transfer).
13.15 Limitation on Additional Amounts; etc. Notwithstanding
anything to the contrary contained in Section 1.10, 1.11, 2.05 or 4.04 of this
Agreement, unless a Bank gives notice to the Borrower that it is obligated to
pay an amount under the respective such Section within six (6) months after the
later of (i) the date the Bank incurs the respective increased costs, Taxes,
loss, expense or liability, reduction in amounts received or receivable or
reduction in return on capital or (ii) the date such Bank has actual knowledge
of its incurrence of the respective increased costs, Taxes, loss, expense or
liability, reductions in amounts received or receivable or reduction in return
on capital, then such Bank shall only be entitled to be compensated for such
amount by the Borrower
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pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be, to the
extent the costs, Taxes, loss, expense or liability, reduction in amounts
received or receivable or reduction in return on capital are incurred or
suffered on or after the date which occurs six (6) months prior to such Bank
giving notice to the Borrower that it is obligated to pay the respective amounts
pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be. This
Section 13.15 shall have no applicability to any Section of this Agreement other
than said Sections 1.10, 1.11, 2.05 and 4.04.
13.16 Confidentiality. (a) Subject to the provisions of clause
(b) of this Section 13.16, each Bank agrees that it will use its best efforts
not to disclose without the prior consent of the Borrower (other than to its
employees, auditors, advisors or counsel or to another Bank if the Bank or such
Bank's holding or parent company in its sole discretion determines that any such
party should have access to such information, provided such Persons shall be
subject to the provisions of this Section 13.16 to the same extent as such Bank)
any information with respect to Holdings or any of its Subsidiaries which is now
or in the future furnished pursuant to this Agreement or any other Credit
Document and which is designated by any Credit Party to the Banks in writing as
confidential, provided that any Bank may disclose any such information (A) as
has become generally available to the public, (B) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Bank or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or
elsewhere) or their successors, (C) as may be required or appropriate in respect
to any summons or subpoena or in connection with any litigation, (D) in order to
comply with any law, order, regulation or ruling applicable to such Bank, (E) to
the Agent or the Collateral Agent and (F) to any prospective or actual
transferee or participant in connection with any contemplated transfer or
participation of any of the Notes or Commitments or any interest therein by such
Bank, provided, that such prospective transferee executes an agreement with such
Bank containing provisions substantially the same as to those contained in this
Section.
(b) Each of Holdings, FCI Holding and the Borrower hereby
acknowledges and agrees that each Bank may share with any of its affiliates any
information related to Holdings or any of its Subsidiaries (including, without
limitation, any nonpublic customer information regarding the creditworthiness of
Holdings and its Subsidiaries, provided such Persons shall be subject to the
provisions of this Section 13.16 to the same extent as such Bank).
13.17 Registry. The Borrower hereby designates the Agent to
serve as the Borrower's agent, solely for purposes of this Section 13.17, to
maintain a register (the "Register") on which it will record the Commitments
from time to time of each of the Banks, the Loans made by each of the Banks and
each repayment in respect of the principal amount of the Loans of each Bank.
Failure to make any such recordation, or any error in such recordation shall not
affect the Borrower's obligations in respect of such Loans. With respect to any
Bank, the transfer of the Commitment of such Bank and the rights to the
principal of, and interest on, any Loan made pursuant to such Commitment shall
not be effective until such transfer is recorded on the Register maintained by
the Agent with respect to ownership of such Commitment and Loans and prior to
such recordation all amounts owing to the transferor with respect to such
Commitment and Loans shall remain owing to the transferor. The registration of
assignment or transfer of all or part of any
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Commitment and Loans shall be recorded by the Agent on the Register only upon
the acceptance by the Agent of a properly executed and delivered Assignment and
Assumption Agreement pursuant to Section 13.04(b). Coincident with the delivery
of such an Assignment and Assumption Agreement to the Agent for acceptance and
registration of assignment or transfer of all or part of a Loan, or as soon
thereafter as practicable, the assigning or transferor Bank shall surrender the
Note evidencing such Loan, and thereupon one or more new Notes in the same
aggregate principal amount shall be issued to the assigning or transferor Bank
and/or the new Bank. The Borrower agrees to indemnify the Agent from and against
any and all losses, claims, damages and liabilities of whatsoever nature which
may be imposed on, asserted against or incurred by the Agent in performing its
duties under this Section 13.17.
SECTION 14. HOLDINGS GUARANTY.
14.01 The Holdings Guaranty. In order to induce the Banks to
enter into this Agreement and to extend credit hereunder and in recognition of
the direct benefits to be received by Holdings from the proceeds of the Loans
and the issuance of the Letters of Credit and to induce the Banks or any of
their respective Affiliates to enter into Interest Rate Protection and Other
Hedging Agreements, Holdings hereby agrees with the Banks as follows: Holdings
hereby unconditionally and irrevocably guarantees as primary obligor and not
merely as surety the full and prompt payment when due, whether upon maturity, by
acceleration or otherwise, of any and all of the Guaranteed Obligations of the
Borrower to the Secured Creditors. If any or all of the Guaranteed Obligations
of the Borrower to the Secured Creditors becomes due and payable hereunder,
Holdings unconditionally promises to pay such indebtedness to the Secured
Creditors, on order, or demand, together with any and all reasonable expenses
which may be incurred by the Agent or the Secured Creditors in collecting any of
the Guaranteed Obligations.
14.02 Bankruptcy. Additionally, Holdings unconditionally and
irrevocably guarantees the payment of any and all of the Guaranteed Obligations
of the Borrower to the Secured Creditors whether or not then due or payable by
the Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 10.05, and unconditionally and irrevocably promises to pay
such Guaranteed Obligations to the Secured Creditors, on order, or demand, in
lawful money of the United States of America.
14.03 Nature of Liability. The liability of Holdings hereunder
is exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of the Borrower whether executed by Holdings, any other
Guarantor or by any other party, and the liability of Holdings hereunder shall
not be affected or impaired by (i) any direction as to application of payment by
the Borrower or by any other party, or (ii) any other continuing or other
guaranty, undertaking or maximum liability of a guarantor or of any other party
as to the Guaranteed Obligations of the Borrower, or (iii) any payment on or in
reduction of any such other guaranty or undertaking, or (iv) any dissolution,
termination or increase, decrease or change in personnel by the Borrower, or (v)
any payment made to the Agent or the Secured Creditors on the indebtedness which
the Agent or such Secured Creditors repay the Borrower pursuant to court order
in any bankruptcy, reorganization,
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arrangement, moratorium or other debtor relief proceeding, and Holdings waives
any right to the deferral or modification of its obligations hereunder by reason
of any such proceeding.
14.04 Independent Obligation. The obligations of Holdings
hereunder are independent of the obligations of any other guarantor or the
Borrower, and a separate action or actions may be brought and prosecuted against
Holdings whether or not action is brought against any other guarantor or the
Borrower and whether or not any other guarantor or the Borrower be joined in any
such action or actions. Holdings waives, to the fullest extent permitted by law,
the benefit of any statute of limitations affecting its liability hereunder or
the enforcement thereof. Any payment by the Borrower or other circumstance which
operates to toll any statute of limitations as to the Borrower shall operate to
toll the statute of limitations as to Holdings.
14.05 Authorization. Holdings authorizes the Agent and the
Secured Creditors without notice or demand (except as shall be required by
applicable statute and cannot be waived), and without affecting or impairing its
liability hereunder, from time to time to:
(a) change the manner, place or terms of payment of, and/or
change or extend the time of payment of, renew, increase, accelerate or
alter, any of the Guaranteed Obligations (including any increase or
decrease in the rate of interest thereon), any security therefor, or
any liability incurred directly or indirectly in respect thereof, and
the Holdings Guaranty herein made shall apply to the Guaranteed
Obligations as so changed, extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, realize upon or
otherwise deal with in any manner and in any order any property by
whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, the Guaranteed Obligations or any liabilities (including any
of those hereunder) incurred directly or indirectly in respect thereof
or hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers,
guarantors, the Borrower or other obligors;
(e) settle or compromise any of the Guaranteed Obligations,
any security therefor or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and may subordinate the payment of all or any part thereof to
the payment of any liability (whether due or not) of the Borrower to
its creditors other than the Banks;
(f) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of the Borrower to the Secured Creditors
regardless of what liability or liabilities of Holdings or the Borrower
remain unpaid;
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(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements
referred to herein, or otherwise amend, modify or supplement this
Agreement or any of such other instruments or agreements; and/or
(h) take any other action which would, under otherwise
applicable principles of common law, give rise to a legal or equitable
discharge of Holdings from its liabilities under this Section 14.
14.06 Reliance. It is not necessary for the Agent or the
Secured Creditors to inquire into the capacity or powers of the Borrower or its
Subsidiaries or the officers, directors, partners or agents acting or purporting
to act on its behalf, and any Guaranteed Obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed hereunder.
14.07 Subordination. Any of the indebtedness of the Borrower
relating to the Guaranteed Obligations now or hereafter owing to Holdings is
hereby subordinated to the Guaranteed Obligations of the Borrower owing to the
Agent and the Secured Creditors; and if the Agent so requests at a time when an
Event of Default exists, all such indebtedness relating to the Guaranteed
Obligations of the Borrower to Holdings shall be collected, enforced and
received by Holdings for the benefit of the Secured Creditors and be paid over
to the Agent on behalf of the Secured Creditors on account of the Guaranteed
Obligations of the Borrower to the Secured Creditors, but without affecting or
impairing in any manner the liability of Holdings under the other provisions of
this Holdings Guaranty. Prior to the transfer by Holdings of any Revolving Note
or negotiable instrument evidencing any of the indebtedness relating to the
Guaranteed Obligations of the Borrower to Holdings, Holdings shall mark such
Revolving Note or negotiable instrument with a legend that the same is subject
to this subordination. The provisions of this Section 14.07 (and any claims of
Holdings as described above) are subject to the provisions of Section 14.08(c).
14.08 Waiver. (a) Holdings waives any right (except as shall
be required by applicable statute and cannot be waived) to require the Agent or
the Secured Creditors to (i) proceed against the Borrower, any other guarantor
or any other party, (ii) proceed against or exhaust any security held from the
Borrower, any other guarantor or any other party or (iii) pursue any other
remedy in the Agent's or the Secured Creditors' power whatsoever. Holdings
waives any defense based on or arising out of any defense of the Borrower, any
other guarantor or any other party, other than payment in full of the Guaranteed
Obligations, based on or arising out of the disability of the Borrower, any
other guarantor or any other party, or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Borrower other than payment in full of the Guaranteed
Obligations. The Agent and the Secured Creditors may, at their election,
foreclose on any security held by the Agent, the Collateral Agent or the Secured
Creditors by one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable (to the extent such sale is
permitted by applicable law), or exercise any other right or remedy the Agent
and the Secured Creditors may have against the Borrower or any other party, or
any security, without affecting or impairing in any way the liability of
Holdings hereunder except to the extent the Guaranteed Obligations have been
paid. Holdings waives any defense arising out of any such election by the Agent
and the Secured Creditors, even
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though such election operates to impair or extinguish any right of reimbursement
or subrogation or other right or remedy of Holdings against any Borrower or any
other party or any security.
(b) Holdings waives all presentments, demands for performance,
protests and notices, including, without limitation, notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Holdings
Guaranty, and notices of the existence, creation or incurring of new or
additional Guaranteed Obligations. Holdings assumes all responsibility for being
and keeping itself informed of the Borrower's financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations and the nature, scope and extent of the risks which
Holdings assumes and incurs hereunder, and agrees that the Agent and the Secured
Creditors shall have no duty to advise Holdings of information known to them
regarding such circumstances or risks.
(c) Holdings understands that to the extent the Guaranteed
Obligations are secured by Real Property, Holdings shall be liable for the full
amount of the liability hereunder notwithstanding foreclosure on any such Real
Property by trustee sale or any other reason impairing Holdings' or any secured
creditors' right to proceed against the Borrower.
14.09 Nature of Liability. It is the desire and intent of
Holdings and the Secured Creditors that this Holdings Guaranty shall be enforced
against Holdings to the fullest extent permissible under the laws and public
policies applied in each jurisdiction in which enforcement is sought. If,
however, and to the extent that, the obligations of Holdings under this Holdings
Guaranty shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers), then the amount of the
Guaranteed Obligations of Holdings shall be deemed to be reduced and Holdings
shall pay the maximum amount of the Guaranteed Obligations which would be
permissible under applicable law.
109
117
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
1341 West Mockingbird Lane ATRIUM CORPORATION
Suite 1200W
Dallas, TX 75247
Attn: Randall S. Fojtasek and By: /s/ Randall S. Fojtasek
Jeff L. Hull --------------------------------
Telephone: (214) 634-0836 Name: Randall S. Fojtasek
Telecopy: (214) 631-4231 ------------------------------
Title: President and Chief Executive
-----------------------------
Officer
------------------------------------
with a copy to:
Hicks, Muse, Tate & Furst
Incorporated
200 Crescent Court
Suite 1600
Dallas, TX 75201
Attn: Thomas O. Hicks,
John R. Muse,
Jack D. Furst and
Lawrence D. Stuart, Jr.
Telephone: (214) 740-7300
Telecopy: (214) 740-7313
and
Hicks, Muse, Tate & Furst
Incorporated
1325 Avenue of the Americas
25th Floor
New York, New York 10019
Attn: Mr Charles W. Tate
Telephone: (212) 424-1400
Telecopy: (212) 424-1450
S-1
118
1341 West Mockingbird Lane ATRIUM COMPANIES, INC.
Suite 1200W
Dallas, TX 75247 By:/s/ Randall S. Fojtasek
Attn: Randall S. Fojtasek and -----------------------------------------
Jeff L. Hull Name:Randall S. Fojtasek
Telephone: (214) 634-0836 ---------------------------------------
Telecopy: (214) 631-4231 Title: President and Chief Executive Officer
with a copy to: -------------------------------------
Hicks, Muse, Tate & Furst
Incorporated
200 Crescent Court
Suite 1600
Dallas, TX 75201
Attn: Thomas O. Hicks,
John R. Muse,
Jack D. Furst and
Lawrence D. Stuart, Jr.
Telephone: (214) 740-7300
Telecopy: (214) 740-7313
and
Hicks, Muse, Tate & Furst
Incorporated
1325 Avenue of the Americas
25th Floor
New York, New York 10019
Attn: Mr Charles W. Tate
Telephone: (212) 424-1400
Telecopy: (212) 424-1450
S-2
119
BANKERS TRUST COMPANY,
individually and as Agent
By: /s/ DAVID J. BELL
----------------------------------
Name: David J. Bell
--------------------------------
Title: Vice President
-------------------------------
S-3
120
SCHEDULE I
COMMITMENTS
Revolving Term Loan
Bank Loan Commitment Commitment
- ---- --------------- -----------
Bankers Trust Company $20,000,000 $17,500,000
----------- ----------
Total $20,000,000 $17,500,000
Schedule I
121
SCHEDULE II
BANK ADDRESSES
Bankers Trust Company 130 Liberty Street
New York, New York 10006
30th Floor
Telephone No.: (212) 250-7671
Telecopier No.: (212) 250-7218
Attention: Mary Kay Coyle
SCHEDULE II