EXHIBIT 4
CLARCOR Inc.
Credit Agreement dated April 8, 2003
EXECUTION COPY
CREDIT AGREEMENT
DATED AS OF APRIL 8, 2003
AMONG
CLARCOR INC.,
THE LENDERS
AND
BANK ONE, NA
as Agent
TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS 1
ARTICLE 2. THE CREDITS ............................................................... 15
2.1. Commitment ................................................................ 15
2.2. Determination of Dollar Amounts; Termination .............................. 15
2.2.1. Determination ..................................................... 15
2.2.2. Termination ....................................................... 15
2.3. Ratable Loans ............................................................. 16
2.4. Types of Advances ......................................................... 16
2.5. Swing Line Loans .......................................................... 16
2.5.1. Amount of Swing Line Loans ........................................ 16
2.5.2. Borrowing Notice .................................................. 16
2.5.3. Making of Swing Line Loans ........................................ 16
2.5.4. Repayment of Swing Line Loans ..................................... 16
2.6. Commitment Fee; Reduction and Increase in Aggregate Commitment ............ 17
2.6.1. Commitment Fee .................................................... 17
2.6.2. Reduction of Commitment ........................................... 17
2.6.3. Increased Commitment .............................................. 17
2.7. Minimum Amount of Each Advance ............................................ 19
2.8. Optional Principal Payments ............................................... 19
2.9. Method of Selecting Types and Interest Periods for New Advances ........... 19
2.10. Conversion and Continuation of Outstanding Advances ....................... 20
2.11. Method of Borrowing ....................................................... 20
2.12. Changes in Interest Rate, etc. ............................................ 21
2.13. Rates Applicable After Default ............................................ 21
2.14. Method of Payment ......................................................... 21
2.14.1. Timing of Payments ................................................ 21
2.14.2. Currency Regulations .............................................. 22
2.15. Advances to be Made in Euro ............................................... 22
2.16. Noteless Agreement; Evidence of Indebtedness .............................. 22
2.16.1. Lender's Records .................................................. 22
2.16.2. Agent's Records ................................................... 22
2.16.3. Prima Facie Evidence .............................................. 22
2.16.4. Notes ............................................................. 22
2.17. Telephonic Notices ........................................................ 23
2.18. Interest Payment Dates; Interest and Fee Basis ............................ 23
2.19. Facility LCs .............................................................. 23
2.19.1. Issuance .......................................................... 23
2.19.2. Participations .................................................... 23
2.19.3. Notice ............................................................ 24
2.19.4. LC Fees ........................................................... 24
2.19.5. Administration; Reimbursement by Lenders .......................... 24
2.19.6. Reimbursement by Borrower.......................................... 25
2.19.7. Obligations Absolute............................................... 25
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2.19.8. Actions of LC Issuer............................................... 25
2.19.9. Indemnification ................................................... 26
2.19.10. Lenders' Indemnification.......................................... 26
2.19.11. Rights as a Lender ............................................... 26
2.20. Notification of Advances, Interest Rates, Prepayments
and Commitment Reductions.................................................. 26
2.21. Lending Installations ..................................................... 27
2.22. Non-Receipt of Funds by the Agent ......................................... 27
2.23. Market Disruption ......................................................... 27
2.24. Judgment Currency ......................................................... 27
2.25. Replacement of Lender ..................................................... 28
2.26. Limitation of Interest .................................................... 28
ARTICLE 3. YIELD PROTECTION; TAXES............................................................ 29
3.1. Yield Protection .......................................................... 29
3.2. Changes in Capital Adequacy Regulations ................................... 30
3.3. Availability of Types of Advances ......................................... 30
3.4. Funding Indemnification ................................................... 30
3.5. Taxes ..................................................................... 31
3.5.1. No Offset for Taxes .............................................. 31
3.5.2. Payment of Other Taxes ........................................... 31
3.5.3. Tax Indemnity .................................................... 31
3.5.4. Non-U.S. Lenders ................................................. 31
3.5.5. Exception to Tax Indemnity ....................................... 32
3.5.6. Additional Documentation ......................................... 32
3.5.7. Agent Indemnification ............................................ 32
3.6. Lender Statements; Survival of Indemnity .................................. 32
ARTICLE 4. CONDITIONS PRECEDENT .............................................................. 33
4.1. Initial Credit Extension .................................................. 33
4.2. Each Credit Extension ..................................................... 34
ARTICLE 5. REPRESENTATIONS AND WARRANTIES..................................................... 34
5.1. Existence and Standing .................................................... 34
5.2. Authorization and Validity ................................................ 34
5.3. No Conflict; Government Consent ........................................... 35
5.4. Financial Statements ...................................................... 35
5.5. Material Adverse Change ................................................... 35
5.6. Taxes ..................................................................... 35
5.7. Litigation and Contingent Obligations ..................................... 35
5.8. Subsidiaries .............................................................. 35
5.9. ERISA ..................................................................... 36
5.10. Accuracy of Information ................................................... 36
5.11. Regulation U .............................................................. 36
5.12. Material Agreements ....................................................... 36
5.13. Compliance With Laws ...................................................... 36
5.14. Ownership of Properties ................................................... 36
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5.15. Prohibited Transactions ................................................... 36
5.16. Environmental Matters ..................................................... 37
5.17. Investment Company Act .................................................... 37
5.18. Public Utility Holding Company Act ........................................ 37
5.19. Post-Retirement Benefits .................................................. 37
5.20. Insurance ................................................................. 37
ARTICLE 6. COVENANTS ......................................................................... 38
6.1. Financial Reporting ....................................................... 38
6.2. Use of Proceeds ........................................................... 39
6.3. Notice of Default ......................................................... 39
6.4. Conduct of Business ....................................................... 39
6.5. Taxes ..................................................................... 40
6.6. Insurance ................................................................. 40
6.7. Compliance with Laws ...................................................... 40
6.8. Maintenance of Properties ................................................. 40
6.9. Inspection ................................................................ 40
6.10. Dividends ................................................................. 40
6.11. Indebtedness .............................................................. 41
6.12. Merger .................................................................... 41
6.13. Sale of Assets ............................................................ 41
6.14. Investments and Acquisitions .............................................. 41
6.15. Liens ..................................................................... 42
6.16. Affiliates ................................................................ 43
6.17. Letters of Credit ......................................................... 43
6.18. Financial Covenants ....................................................... 43
6.18.1. Interest Coverage Ratio ........................................... 43
6.18.2. Leverage Ratio .................................................... 44
6.18.3. Minimum Net Worth ................................................. 44
6.18.4. Adjustments to Financial Ratios ................................... 44
6.19. Existence; Subsidiary Guarantees .......................................... 44
6.20. Transactions with Affiliates .............................................. 44
ARTICLE 7. DEFAULTS .......................................................................... 44
ARTICLE 8. ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES .................................... 47
8.1. Acceleration; Termination of Extensions of Facility LCs ................... 47
8.2. Amendments ................................................................ 48
8.3. Preservation of Rights .................................................... 48
ARTICLE 9. GENERAL PROVISIONS ................................................................ 48
9.1. Survival of Representations ............................................... 48
9.2. Governmental Regulation ................................................... 48
9.3. Headings .................................................................. 49
9.4. Entire Agreement .......................................................... 49
9.5. Several Obligations; Benefits of this Agreement ........................... 49
9.6. Expenses; Indemnification ................................................. 49
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9.6.1. Expenses .......................................................... 49
9.6.2. Indemnification ................................................... 49
9.7. Numbers of Documents ...................................................... 50
9.8. Accounting ................................................................ 50
9.9. Severability of Provisions ................................................ 50
9.10. Nonliability of Lenders ................................................... 50
9.11. Confidentiality ........................................................... 50
9.12. Nonreliance ............................................................... 51
9.13. Disclosure ................................................................ 51
ARTICLE 10. THE AGENT ......................................................................... 51
10.1. Appointment; Nature of Relationship ....................................... 51
10.2. Powers .................................................................... 51
10.3. General Immunity .......................................................... 51
10.4. No Responsibility for Loans, Recitals, etc. ............................... 51
10.5. Action on Instructions of Lenders ......................................... 52
10.6. Employment of Agents and Counsel .......................................... 52
10.7. Reliance on Documents; Counsel ............................................ 52
10.8. Agent's Reimbursement and Indemnification ................................. 52
10.9. Notice of Default ......................................................... 53
10.10. Rights as a Lender ........................................................ 53
10.11. Lender Credit Decision .................................................... 53
10.12. Successor Agent ........................................................... 53
10.13. Agent and Arranger Fees ................................................... 54
10.14. Delegation to Affiliates .................................................. 54
ARTICLE 11. SETOFF; RATABLE PAYMENTS .......................................................... 54
11.1. Setoff .................................................................... 54
11.2. Ratable Payments .......................................................... 54
ARTICLE 12. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS ................................. 55
12.1. Successors and Assigns .................................................... 55
12.2. Participations ............................................................ 55
12 2.1. Permitted Participants; Effect ................................... 55
12 2.2. Voting Rights .................................................... 55
12 2.3. Benefit of Certain Provisions .................................... 56
12.3. Assignments ............................................................... 56
12 3.1. Permitted Assignments ............................................ 56
12 3.2. Consents ......................................................... 56
12 3.3. Effect; Effective Date ........................................... 56
12 3.4. Register ......................................................... 57
12.4. Dissemination of Information .............................................. 57
12.5. Tax Treatment ............................................................. 57
ARTICLE 13. NOTICES ........................................................................... 57
13.1. Notices ................................................................... 57
13.2. Change of Address ......................................................... 58
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ARTICLE 14. COUNTERPARTS ...................................................................... 58
ARTICLE 15. CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL ..................... 58
15.1. CHOICE OF LAW ............................................................. 58
15.2. CONSENT TO JURISDICTION ................................................... 58
15.3. WAIVER OF JURY TRIAL ...................................................... 58
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CREDIT AGREEMENT
This Agreement, dated as of April 8, 2003, is among CLARCOR Inc., the
Lenders and Bank One, NA, a national banking association having its principal
office in Chicago, Illinois, as LC Issuer and as Agent. The parties hereto agree
as follows:
ARTICLE
1.
DEFINITIONS
As used in this Agreement:
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Borrower or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.
"Advance" means a borrowing hereunder, (i) made by some or all of the
Lenders on the same Borrowing Date, or (ii) converted or continued by the
Lenders on the same date of conversion or continuation, consisting, in either
case, of the aggregate amount of the several Loans of the same Type and, in the
case of Eurocurrency Loans in the same Agreed Currency and for the same Interest
Period. The term "Advance" shall include Swing Line Loans unless otherwise
expressly provided.
"Affected Lender" is defined in Section 2.25.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as contractual representative of
the Lenders pursuant to Article 10, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article 10.
"Aggregate Commitment" means the aggregate of the Commitments of all
the Lenders, as reduced or increased from time to time pursuant to the terms
hereof.
"Aggregate Outstanding Credit Exposure" means, at any time, the
aggregate of the Outstanding Credit Exposure of all the Lenders.
"Agreed Currencies" means (i) Dollars, (ii) so long as such currencies
remain Eligible Currencies, British Pounds Sterling and, from and after becoming
generally available in the international currency and
exchange markets, the Euro, and (iii) any other Eligible Currency which the
Borrower requests the Agent to include as an Agreed Currency hereunder and which
is acceptable to all of the Lenders. For the purposes of this definition, each
of the specific currencies referred to in clause (ii), above, shall mean and be
deemed to refer to the lawful currency of the jurisdiction referred to in
connection with such currency, e.g., "Australian Dollars" means the lawful
currency of Australia.
"Agreement" means this credit agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of the
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Fee Rate" means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the unused portion of the Aggregate
Commitment at such time as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Approximate Equivalent Amount" of any currency with respect to any
amount of Dollars shall mean the Equivalent Amount of such currency with respect
to such amount of Dollars on or as of such date, rounded up to the smallest unit
of such currency commonly in circulation as determined by the Agent from time to
time.
"Arranger" means Banc One Capital Markets, Inc., a Delaware
corporation, and its successors, in its capacity as Lead Arranger and Sole Book
Runner.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assuming Lender" is defined in Section 2.6.3.
"Authorized Officer" means any of Norman E. Johnson, Chairman,
President and Chief Executive Officer, Bruce A. Klein, Vice President - Finance
and Chief Financial Officer or Marcia S. Blaylock, Vice President, Controller of
the Borrower, acting singly.
"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Bank One" means Bank One, NA, a national banking association having
its principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Borrower" means CLARCOR Inc., a Delaware corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
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"Borrowing Notice" is defined in Section 2.9.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurocurrency Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York City for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in Dollars and other
Agreed Currencies are carried on in the London interbank market (and, if the
Advances which are the subject of such borrowing, payment or rate selection are
denominated in Euros, a day upon which such clearing system as is determined by
the Agent to be suitable for clearing or settlement of the Euro is open for
business), and (ii) for all other purposes, a day (other than a Saturday or
Sunday) on which banks generally are open in Chicago for the conduct of
substantially all of their commercial lending activities and interbank wire
transfers can be made on the Fedwire system.
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP consistently applied.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP
consistently applied.
"Cash Equivalent Investments" means (i) short-term obligations of, or
fully guaranteed by, the United States of America, (ii) commercial paper rated
A-1 or better by S&P or P-1 or better by Moody's, (iii) demand deposit accounts
maintained in the ordinary course of business, (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $200,000,000 and (v) investments in
tax-exempt bonds rated Aa by Moody's or AA by S&P (or having comparable
short-term ratings) maturing (or subject to tender at the option of the holder)
within 31 days; provided in each case that the same provides for payment of both
principal and interest (and not principal alone or interest alone) and is not
subject to any contingency regarding the payment of principal or interest.
"Change" is defined in Section 3.2.
"Change in Control" means:
(a) The acquisition (other than from the Borrower) by any
person, entity, or "group", within the meaning of Section 13(d)(3) or 14(d)(2)
of the Exchange Act, of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 15% or more of either the then
outstanding shares of Common Stock or the combined voting power of the
Borrower's then outstanding voting securities entitled to vote generally in the
election of directors; provided, however, no Change in Control shall be deemed
to have occurred for any acquisition by any corporation with respect to which,
following such acquisition, more than 60% of such corporation and the combined
voting power of the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the then
outstanding shares of Common Stock or the combined voting power of the
Borrower's then outstanding voting securities immediately prior to such
acquisition in substantially the same proportions as their ownership,
immediately prior to such acquisition, of the Borrower's then outstanding Common
Stock and then outstanding voting securities, as the case may be; or
3
(b) Individuals who, as of the date hereof, constitute
the board of directors of the Borrower (as of the date hereof "Incumbent Board")
cease for any reason to constitute at least a majority of such board, provided
that any person becoming a director subsequent to the date hereof whose
election, or nomination for election by the Borrower's shareholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board (other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the directors of the Borrower)
shall be, for purposes of this Credit Agreement, considered as though such
person were a member of the Incumbent Board; or
(c) Consummation of a reorganization, merger or
consolidation, in each case, with respect to which persons who were the
stockholders of the Borrower immediately prior to the reorganization, merger or
consolidation do not, immediately thereafter, own more than 60% of the combined
voting power entitled to vote generally in the election of directors of the
reorganized, merged or consolidated company's then outstanding voting
securities, or shareholder approval of a liquidation of dissolution of the
Borrower or of the sale of all or substantially all of the assets of the
Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to
make Revolving Loans to, and participate in Facility LCs issued upon the
application of, the Borrower in an aggregate amount not exceeding the amount set
forth opposite its signature below, as it may be modified as a result of any
assignment that has become effective pursuant to Section 12.3.2 or as otherwise
modified from time to time pursuant to the terms hereof.
"Commitment Fee" is defined in Section 2.6.1.
"Commitment Increase" is defined in Section 2.6.3.
"Commitment Increase Date" is defined in Section 2.6.3.
"Common Stock" means the Common Stock, par value $1 per share, of the
Borrower.
"Computation Date" is defined in Section 2.2.
"Consolidated EBIT" means Consolidated Net Income plus, to the extent
deducted from revenues in determined Consolidated Net Income, (i) Consolidated
Net Interest Expense, (ii) expense for taxes paid or accrued and (iii)
extraordinary losses incurred other than in the ordinary course of business,
minus, to the extent included in Consolidated Net Income, extraordinary gains
realized other than in the ordinary course of business, all calculated for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Net Interest Expense, (ii) expense for taxes paid or accrued, (iii)
depreciation, (iv) amortization and (v) extraordinary losses incurred other than
in the ordinary course of business, minus, to the extent included in
Consolidated Net Income, extraordinary gains realized other than in the ordinary
course of business, all calculated for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
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"Consolidated Funded Indebtedness" means at any time the aggregate
dollar amount of Consolidated Indebtedness which has actually been funded and is
outstanding at such time, whether or not such amount is due or payable at such
time.
"Consolidated Indebtedness" means at any time the aggregate dollar
amount of Indebtedness of the Borrower and its consolidated Subsidiaries
outstanding at such time, calculated on a consolidated basis as of such time.
"Consolidated Net Interest Expense" means, with reference to any
period, the interest expense, net of interest income, of the Borrower and its
Subsidiaries calculated on a consolidated basis for such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Worth" means at any time the stockholders' equity of
the Borrower and its Subsidiaries calculated on a consolidated basis as of such
time.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or the obligations of any such Person as general
partner of a partnership with respect to the liabilities of the partnership.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
of its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Conversion/Continuation Notice" is defined in Section 2.10.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC hereunder.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Default" means an event described in Article 7.
"Dollar Amount" of any currency at any date shall mean (i) the amount
of such currency if such currency is Dollars or (ii) the equivalent in Dollars
of such amount if such currency is any currency other than Dollars, calculated
on the basis of the arithmetical mean of the buy and sell spot rates of exchange
of the Agent for such currency on the London market at 11:00 a.m., London time,
on or as of the most recent Computation Date provided for in Section 2.2.
5
"Dollars" and "$" means the lawful currency of the United States of
America.
"Domestic Subsidiary" means any Subsidiary organized under the laws of
the United States of America, any State thereof or the District of Columbia.
"Eligible Currency" means any currency other than Dollars (i) that is
readily available, (ii) that is freely traded, (iii) in which deposits are
customarily offered to banks in the London interbank market, (iv) which is
convertible into Dollars in the international interbank market and (v) as to
which an Equivalent Amount may be readily calculated. If, after the designation
by the Lenders of any currency as an Agreed Currency, (x) currency control or
other exchange regulations are imposed in the country in which such currency is
issued with the result that different types of such currency are introduced, (y)
such currency is, in the reasonable determination of the Agent, no longer
readily available or freely traded or (z) in the reasonable determination of the
Agent, an Equivalent Amount of such currency is not readily calculable, the
Agent shall promptly notify the Lenders and the Borrower, and such currency
shall no longer be an Agreed Currency until such time as all of the Lenders
agree to reinstate such currency as an Agreed Currency and promptly, but in any
event within five Business Days of receipt of such notice from the Agent, the
Borrower shall repay all Loans in such affected currency or convert such Loans
into Loans in Dollars or another Agreed Currency, subject to the other terms set
forth in Article 2.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, or to the management, release or threatened release of any Hazardous
Material.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interest.
"Equivalent Amount" of any currency with respect to any amount of
Dollars at any date shall mean the equivalent in such currency of such amount of
Dollars, calculated on the basis of the arithmetical mean of the buy and sell
spot rates of exchange of the Agent for such other currency at 11:00 a.m.,
London time, on the date on or as of which such amount is to be determined.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Euro Implementation Date" means January 1, 1999.
"Euro" and/or "EUR" means the euro referred to in Council Regulation
(EC) No. 1103/97 dated June 17, 1997 passed by the Council of the European
Union, or, if different, the then lawful currency of
6
the member states of the European Union that participate in the third stage of
Economic and Monetary Union.
"Eurocurrency" means any Agreed Currency.
"Eurocurrency Advance" means an Advance which, except as otherwise
provided in Section 2.13, bears interest at the applicable Eurocurrency Rate.
"Eurocurrency Payment Office" of the Agent shall mean, for each of the
Agreed Currencies, the office, branch, affiliate or correspondent bank of the
Agent specified as the "Eurocurrency Payment Office" for such currency in
Schedule 3 hereto or such other office, branch, affiliate or correspondent bank
of the Agent as it may from time to time specify to the Borrower and each Lender
as its Eurocurrency Payment Office.
"Eurocurrency Rate" means, with respect to a Eurocurrency Advance for
the relevant Interest Period, the sum of (i) the quotient of (a) the
Eurocurrency Reference Rate applicable to such Interest Period, divided by (b)
one minus the Reserve Requirement (expressed as a decimal) applicable to such
Interest Period, if any, plus (ii) the Applicable Margin.
"Eurocurrency Reference Rate" means, with respect to a Eurocurrency
Advance for the relevant Interest Period, the applicable British Bankers'
Association LIBOR rate for deposits in the applicable Agreed Currency as
reported by any generally recognized financial information service as of 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period, and having a maturity equal to such Interest Period, adjusted for
Federal Reserve Board reserve requirements.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another
document is specifically referenced.
"Existing Credit Agreement" means the Credit Agreement dated as of
September 9, 1999 among the Borrower, the guarantors party thereto, the banks
party thereto, Firstar Bank Milwaukee, National Association, as agent, and Bank
One, Illinois, NA and Amcore Bank N.A. as co-agents.
"Facility LC Application" is defined in Section 2.19.3.
"Facility LC" is defined in Section 2.19.1.
"Facility LC Collateral Account" is defined in Section 8.1.1.
"Facility Termination Date" means April 7, 2008.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal
7
Reserve System arranged by Federal funds brokers on such day, as published for
such day (or, if such day is not a Business Day, for the immediately preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day which is a Business Day, the average of the quotations
at approximately 10:00 a.m. (Chicago time) on such day on such transactions
received by the Agent from three Federal funds brokers of recognized standing
selected by the Agent in its sole discretion.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.13, bears interest at the Floating Rate.
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"GAAP" means generally accepted accounting principles in the United
States of America in effect as of the date of determination thereof.
"Governmental Authority" means the government of the United States of
America, or of any other nation, or any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantor" means each Domestic Subsidiary of the Borrower that
executes and delivers to the Agent a Subsidiary Guarantee Agreement in the form
of Exhibit F hereto along with the accompanying closing documents required by
Sections 4.1(a) through 4.1(d) hereof.
"Guaranty" means, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
Indebtedness, lease, dividend or other obligation of another, including, without
limitation, any such obligation directly or indirectly guaranteed, endorsed
(otherwise than for collection or deposit in the ordinary course of business) or
discounted or sold with recourse by such Person, or in respect of which such
Person is otherwise directly or indirectly liable, including, without
limitation, any such obligation in effect guaranteed by such Person through any
agreement (contingent or otherwise) to purchase, repurchase or otherwise acquire
such obligation or any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise), or to maintain the solvency or
any balance sheet or other financial condition of the obligor of such
obligation, or to make payment for any products, materials or supplies or for
any transportation or service, regardless of the non-delivery or non-furnishing
thereof, in any such case if the purpose or intent of such agreement is to
provide assurance that such obligation will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected against loss in respect thereof. The amount of any
Guaranty shall be equal to the maximum aggregate amount of the obligation
guaranteed or such lesser amount to which the maximum aggregate potential
liability of the guarantor shall have been specifically limited.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
8
"Highest Lawful Rate" means the maximum rate of interest which Lender
is allowed to contract for, charge, take, reserve or receive under applicable
law after taking into account, to the extent required by applicable law, any and
all relevant payments or charges hereunder.
"Increasing Lender" is defined in Section 2.6.3.
"Indebtedness" of a Person means such Person's (i) obligations for
borrowed money, (ii) obligations representing the deferred purchase price of
Property or services (other than accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not assumed or secured by Liens or payable out of the
proceeds or production from Property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) obligations of such Person to purchase securities or other
Property arising out of or in connection with the sale of the same or
substantially similar securities or Property, (vi) Capitalized Lease
Obligations, (vii) any other obligation for borrowed money or other financial
accommodation which in accordance with GAAP consistently applied would be shown
as a liability on the consolidated balance sheet of such Person, (viii)
obligations for which such Person is obligated pursuant to a Guaranty and (ix)
any Contingent Obligation.
"Interest Period" means, with respect to a Eurocurrency Advance, a
period of one, two, three, six, nine or twelve months commencing on a Business
Day selected by the Borrower pursuant to this Agreement. Such Interest Period
shall end on the day which corresponds numerically to such date one, two, three,
six, nine or twelve months thereafter, provided, however, that if there is no
such numerically corresponding day in such next, second, third, sixth, ninth or
twelfth succeeding month, such Interest Period shall end on the last Business
Day of such next, second, third, sixth, ninth or twelfth succeeding month. If an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new calendar
month, such Interest Period shall end on the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade) or contribution of capital by such Person; stocks, bonds, mutual funds,
partnership interests, notes, debentures or other securities owned by such
Person; any deposit accounts and certificate of deposit owned by such Person;
and structured notes, derivative financial instruments and other similar
instruments or contracts owned by such Person.
"LC Fee" is defined in Section 2.19.4.
"LC Issuer" means Bank One (or any subsidiary or Affiliate of Bank One
designated by Bank One) in its capacity as issuer of Facility LCs hereunder
unless issued by another Lender upon the written request of Agent.
"LC Obligations" means, at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs outstanding at
such time plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations.
"LC Payment Date" is defined in Section 2.19.5.
9
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns. Unless otherwise
specified, the term "Lenders" includes Bank One in its capacity as Swing Line
Lender.
"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent with
respect to each Agreed Currency listed on Schedule 4 or otherwise selected by
such Lender or the Agent pursuant to Section 2.21.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"LIBOR" means, for an Interest Period for Eurocurrency Advances, (a)
the LIBOR Index Rate for such Interest Period, if such rate is available, and
(b) if the LIBOR Index Rate cannot be determined, the arithmetic average of the
rates of interest per annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) at which deposits in U.S. Dollars in immediately available funds are
offered to the Administrative Agent at 11:00 a.m. (London, England time) two
Business Days before the beginning of such Interest Period by three or more
major banks in the interbank eurodollar market selected by the Administrative
Agent for delivery on the first day of and for a period equal to such Interest
Period and in an amount equal or comparable to the principal amount of the
Eurocurrency Advance scheduled to be made by the Administrative Agent as part of
such Borrowing.
"LIBOR Index Rate" means, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a period equal to such
Interest Period, which appears on the Telerate Page 3750 as of 11:00 a.m.
(London, England time) on the day two Business Days before the commencement of
such Interest Period.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means a Revolving Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, the Facility LC Applications,
the Guaranties and any Notes issued pursuant to Section 2.16.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents, or
(iii) the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Agent, the LC Issuer or the Lenders thereunder.
"Material Indebtedness" means Indebtedness in an outstanding principal
amount of $10,000,000 or more in the aggregate (or the equivalent thereof in any
currency other than U.S. dollars).
"Material Indebtedness Agreement" means any agreement under which any
Material Indebtedness was created or is governed or which provides for the
incurrence of Indebtedness in an amount which would constitute Material
Indebtedness (whether or not an amount of Indebtedness constituting Material
Indebtedness is outstanding thereunder).
10
"Material Plan" is defined in Section 7.11.
"Modify" and "Modification" are defined in Section 2.19.1.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"National Currency Unit" means the unit of currency (other than a Euro
unit) of each member state of the European Union that participates in the third
stage of Economic and Monetary Union.
"Non-U.S. Lender" is defined in Section 3.5.4.
"Note" is defined in Section 2.16.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all Reimbursement Obligations, all accrued and unpaid
fees and all expenses, reimbursements, indemnities and other obligations of the
Borrower to the Lenders or to any Lender, the Agent, the LC Issuer or any
indemnified party arising under the Loan Documents.
"Original Currency" is defined in Section 2.14.2.
"Other Taxes" is defined in Section 3.5.2.
"Outstanding Credit Exposure" means, as to any Lender at any time, the
sum of (i) the aggregate principal amount of its Revolving Loans outstanding at
such time, plus (ii) an amount equal to its Pro Rata Share of the LC Obligations
at such time, plus (iii) an amount equal to its Pro Rata Share of the aggregate
principal amount of Swing Line Loans outstanding at such time.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each month.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Industrial Revenue Bond Liabilities" means liabilities
(including, without limitation, reimbursement obligations on letters of credit)
of the Borrower and its Subsidiaries aggregating not more than $40,000,000 at
any one time outstanding in respect of industrial revenue bond issues
constituting long-term Indebtedness which finance additions to or improvements
in plant, property or equipment of the Borrower or any Subsidiary secured (if at
all) by no Property of the Borrower or any Subsidiary, other than the fixed
assets so acquired or improved, replacements thereto and intangible property
related specifically thereto.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
11
"Plan" means an employee benefit plan within the meaning of Section
3(3) of ERISA as to which the Borrower or any member of the Controlled Group may
have any liability.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged by Bank One or its parent to any customer) changing when
and as said prime rate changes.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Rate Management Obligations" means any and all obligations of the
Borrower or any Subsidiary, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor), under (i) any
and all Rate Management Transactions, and (ii) any and all cancellations, buy
backs, reversals, terminations or assignments of any Rate Management
Transactions.
"Rate Management Transaction" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered into between
the Borrower or any Subsidiary and any Lender or Affiliate thereof which is a
rate swap, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions) or
any combination thereof, whether linked to one or more interest rates, foreign
currencies, commodity prices, equity prices or other financial measures.
"Register" is defined in Section 12.3.4.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member banks of the Federal
Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.19 to reimburse the
LC Issuer for amounts paid by the LC Issuer in respect of any one or more
drawings under Facility LCs.
12
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Reports" is defined in Section 9.6.
"Required Lenders" means Lenders in the aggregate having at least 51%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least a majority of the Aggregate
Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Loan" means, with respect to a Lender, such Lender's loan
made pursuant to its commitment to lend set forth in Section 2.1 (or any
conversion or continuation thereof).
"S&P" means Standard and Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"Schedule" refers to a specific schedule to this Agreement, unless
another document is specifically referenced.
"SEC" means the United States Securities and Exchange Commission,
together with any successor agency responsible for the administration and
enforcement of the Securities Act of 1933, as amended from time to time, and the
Exchange Act.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Indebtedness" means any Indebtedness secured by a Lien.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Stated Rate" is defined in Section 2.26.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
13
"Subsidiary Guarantee Agreement" means the agreement in the form of
Exhibit F hereto executed by a Subsidiary whereby it acknowledges it is party
thereto as a Guarantor.
"Substantial Portion" means, (A) for purposes of Section 6.13, Property
of the Borrower and its Subsidiaries which represents more than the lesser of
(i) 15% of the consolidated assets of the Borrower and its Subsidiaries
(determined in accordance with GAAP) or Property which is responsible for more
than 15% of the consolidated net sales of the Borrower and its Subsidiaries, in
either case, in any fiscal year during the term of this Agreement or (ii)
$150,000,000 of Property of the Borrower and its Subsidiaries (determined in
accordance with GAAP) during the term of this Agreement and (B) for purposes of
Sections 7.7, 7.8 and 7.9, $150,000,000 of Property of the Borrower and its
Subsidiaries (as determined in accordance with GAAP).
"Swing Line Borrowing Notice" is defined in Section 2.5.2.
"Swing Line Commitment" means the obligation of the Swing Line Lender
to make Swing Line Loans up to a maximum principal amount of $10,000,000 at any
one time outstanding.
"Swing Line Lender" means Bank One or such other Lender which may
succeed to its rights and obligations as Swing Line Lender pursuant to the terms
of this Agreement.
"Swing Line Loan" means a Loan made available to the Borrower by the
Swing Line Lender pursuant to Section 2.5.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes and Other Taxes.
"Telerate Page 3750" means the display designated as "Page 3750" on the
Telerate Service (or such other page as may replace Page 3750 on that service or
such other service as may be nominated by the British Bankers' Association as
the information vendor for the purpose of displaying British Bankers'
Association Interest Settlement Rates for U.S. Dollars deposits).
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurocurrency Advance and with respect to any Loan, its nature
as a Floating Rate Loan or a Eurocurrency Loan.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using the actuarial assumptions set forth in Note I to the financial
statements referred to in Section 5.4.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Voting Stock" of any Person means capital stock of any class or
classes or other equity interests (however designated) having ordinary voting
power for the election of directors or similar governing body of such Person,
other than stock or other equity interests (other than directors' qualifying
shares as required by law) shall be owned by the Borrower and/or one or more of
its Wholly-Owned Subsidiaries.
14
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE
2.
THE CREDITS
2.1. Commitment. From and including the date of this Agreement and
prior to the Facility Termination Date, each Lender severally agrees, on the
terms and conditions set forth in this Agreement, to (i) make Advances to the
Borrower in Agreed Currencies and (ii) participate in Facility LCs issued upon
the request of the Borrower, provided that (a) all Floating Rate Advances shall
be made in Dollars and (b) after giving effect to the making of each such
Advance and the issuance of each such Facility LC, such Lender's Outstanding
Credit Exposure shall not exceed its Pro Rata Share of the Available Aggregate
Commitment. Subject to the terms of this Agreement, the Borrower may borrow,
repay and reborrow at any time prior to the Facility Termination Date. The
Commitments to lend hereunder shall expire on the Facility Termination Date. The
LC Issuer will issue Facility LCs hereunder on the terms and conditions set
forth in Section 2.19.
2.2. Determination of Dollar Amounts; Termination.
2.2.1. Determination. The Agent will determine the Dollar
Amount of:
(a) each Advance as of the date three Business
Days prior to the Borrowing Date or, if
applicable, date of conversion/continuation
of such Advance, and
(b) all outstanding Advances on and as of the
last Business Day of each quarter and on any
other Business Day elected by the Agent in
its discretion or upon instruction by the
Required Lenders.
Each day upon or as of which the Agent determines Dollar Amounts as described in
the preceding clauses (a) and (b) is herein described as a "Computation Date"
with respect to each Advance for which a Dollar Amount is determined on or as of
such day. If at any time the Dollar Amount of the sum of the aggregate principal
amount of all outstanding Advances (calculated, with respect to those Advances
denominated in Agreed Currencies other than Dollars, as of the most recent
Computation Date with respect to each such Advance) exceeds the Aggregate
Commitment, the Borrower shall immediately repay Advances in an aggregate
principal amount sufficient to eliminate any such excess.
2.2.2. Termination. The Aggregate Outstanding Credit
Exposure and all other unpaid Obligations, including without limitation all
Swing Line Loans shall be paid in full by the Borrower on the Facility
Termination Date.
15
2.3. Ratable Loans. Each Advance hereunder shall consist of Loans
made from the several Lenders ratably according to their Pro Rata Shares.
2.4. Types of Advances. The Advances may be Floating Rate Advances
or Eurocurrency Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.9 and 2.10.
2.5. Swing Line Loans.
2.5.1. Amount of Swing Line Loans. Upon the satisfaction of
the conditions precedent set forth in Section 4.2 and, if such Swing Line Loan
is to be made on the date of the initial Advance hereunder, the satisfaction of
the conditions precedent set forth in Section 4.1 as well, from and including
the date of this Agreement and prior to the Facility Termination Date, the Swing
Line Lender agrees, on the terms and conditions set forth in this Agreement, to
make Swing Line Loans to the Borrower from time to time in an aggregate
principal amount not to exceed the Swing Line Commitment, provided that, at
Agent's option, the Aggregate Outstanding Credit Exposure shall not at any time
exceed the Aggregate Commitment, and provided further that at no time shall the
sum of (i) the Swing Line Lender's Pro Rata Share of the Swing Line Loans, plus
(ii) the outstanding Revolving Loans made by the Swing Line Lender pursuant to
Section 2.1, plus (iii) the Swing Line Lender's Pro Rata Share of LC Obligations
exceed the Swing Line Lender's Commitment at such time. Subject to the terms of
this Agreement, the Borrower may borrow, repay and reborrow Swing Line Loans at
any time prior to the Facility Termination Date.
2.5.2. Borrowing Notice. The Borrower shall deliver to the
Agent and the Swing Line Lender irrevocable notice (a "Swing Line Borrowing
Notice") not later than noon (Chicago time) on the Borrowing Date of each Swing
Line Loan, specifying (i) the applicable Borrowing Date (which date shall be a
Business Day), and (ii) the aggregate amount of the requested Swing Line Loan
which shall be an amount not less than $100,000. The Swing Line Loans shall bear
interest at the Floating Rate.
2.5.3. Making of Swing Line Loans. Promptly after receipt of
a Swing Line Borrowing Notice, the Agent shall notify each Lender by fax, or
other similar form of transmission, of the requested Swing Line Loan. Not later
than 2:00 p.m. (Chicago time) on the applicable Borrowing Date, the Swing Line
Lender shall make available the Swing Line Loan, in funds immediately available
in Chicago, to the Agent at its address specified pursuant to Article 13. The
Agent will promptly make the funds so received from the Swing Line Lender
available to the Borrower on the Borrowing Date at the Agent's aforesaid
address.
2.5.4. Repayment of Swing Line Loans. Each Swing Line Loan
shall be paid in full by the Borrower on or before the fifth (5th) Business Day
after the Borrowing Date for such Swing Line Loan. In addition, the Swing Line
Lender (i) may at any time in its sole discretion with respect to any
outstanding Swing Line Loan, or (ii) shall on the fifth (5th) Business Day after
the Borrowing Date of any Swing Line Loan, require each Lender (including the
Swing Line Lender) to make a Revolving Loan in the amount of such Lender's Pro
Rata Share of such Swing Line Loan (including, without limitation, any interest
accrued and unpaid thereon), for the purpose of repaying such Swing Line Loan.
Not later than noon (Chicago time) on the date of any notice received pursuant
to this Section 2.5.4, each Lender shall make available its required Revolving
Loan, in funds immediately available in Chicago to the Agent at its address
specified pursuant to Article 13. Revolving Loans made pursuant to this Section
2.5.4 shall initially be Floating Rate Advances and thereafter may be continued
as Floating Rate Advances or converted into Eurodollar Advances in the manner
provided in Section 2.10 and subject to the other conditions and limitations set
forth in this Article 2. Unless a Lender shall have notified the Swing Line
Lender, prior to its making any Swing Line Loan, that any applicable condition
precedent set forth in
16
Sections 4.1 or 4.2 had not then been satisfied, such Lender's obligation to
make Revolving Loans pursuant to this Section 2.5.4 to repay Swing Line Loans
shall be unconditional, continuing, irrevocable and absolute and shall not be
affected by any circumstances, including, without limitation, (a) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the Agent, the Swing Line Lender or any other Person, (b) the occurrence
or continuance of a Default or Unmatured Default, (c) any adverse change in the
condition (financial or otherwise) of the Borrower, or (d) any other
circumstances, happening or event whatsoever. In the event that any Lender fails
to make payment to the Agent of any amount due under this Section 2.5.4, the
Agent shall be entitled to receive, retain and apply against such obligation the
principal and interest otherwise payable to such Lender hereunder until the
Agent receives such payment from such Lender or such obligation is otherwise
fully satisfied. In addition to the foregoing, if for any reason any Lender
fails to make payment to the Agent of any amount due under this Section 2.5.4,
such Lender shall be deemed, at the option of the Agent, to have unconditionally
and irrevocably purchased from the Swing Line Lender, without recourse or
warranty, an undivided interest and participation in the applicable Swing Line
Loan in the amount of such Revolving Loan, and such interest and participation
may be recovered from such Lender together with interest thereon at the Federal
Funds Effective Rate for each day during the period commencing on the date of
demand and ending on the date such amount is received. On the Facility
Termination Date, the Borrower shall repay in full the outstanding principal
balance of the Swing Line Loans.
2.6. Commitment Fee; Reduction and Increase in Aggregate
Commitment.
2.6.1. Commitment Fee. The Borrower agrees to pay to the
Agent for the account of each Lender, according to its Pro Rata Share, a
Commitment Fee ("Commitment Fee") at a per annum rate equal to the Applicable
Fee Rate on the daily Available Aggregate Commitment from the date hereof to and
including the Facility Termination Date, payable quarterly in arrears on the
last day of each of March, June, September and December during the Term hereof
and on the Facility Termination Date. Swing Line Loans shall not count as usage
of any Lender's Commitment for purpose of calculating the commitment fee due
hereunder.
2.6.2. Reduction of Commitment. The Borrower may permanently
reduce the Aggregate Commitment in whole, or in part ratably among the Lenders
in integral multiples of $5,000,000 (or the Approximate Equivalent Amount if
denominated in an Agreed Currency other than Dollars), upon at least one
Business Day's written notice to the Agent, which notice shall specify the
amount of any such reduction, provided, however, that the amount of the
Aggregate Commitment may not be reduced below the aggregate principal Dollar
Amount of the then Aggregate Outstanding Credit Exposure. All accrued commitment
fees shall be payable on the effective date of any termination of the
obligations of the Lenders to make Credit Extensions hereunder. For purposes of
calculating the commitment fee hereunder, the principal amount of each Credit
Extension made in an Agreed Currency other than Dollars shall be at any time the
Dollar Amount of such Credit Extension as determined on the most recent
Computation Date with respect to such Credit Extension.
2.6.3. Increased Commitment.
(a) The Borrower, may at any time, by written
notice to the Agent, propose that the total Commitments hereunder be increased
(each such proposed increase being a "Commitment Increase"), pursuant to which,
Agent shall specify each existing Lender (each an "Increasing Lender") and/or
each additional lender (each an "Assuming Lender") that shall have agreed to an
additional Commitment and the date on which such increase is to be effective
(the "Commitment Increase Date"), which shall be a Business Day at least three
Business Days after delivery of such notice and 30 days prior to the Facility
Termination Date; provided that:
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(i) that the minimum amount of the
Commitment of any Assuming Lender,
and the minimum amount of the
increase of the Commitment of any
Increasing Lender, as part of such
Commitment Increase shall be
$5,000,000 or a larger multiple of
$1,000,000;
(ii) immediately after giving effect to
such Commitment Increase, the
Aggregate Commitments hereunder
shall not exceed $200,000,000;
(iii) no Default shall have occurred and
be continuing on such Commitment
Increase Date or shall result from
the proposed Commitment Increase;
(iv) the representations and warranties
contained in this Agreement shall
be true and correct on and as of
the Commitment Increase Date as if
made on and as of such date (or, if
any such representation or warranty
is expressly stated to have been
made as of a specific date, as of
such specific date).
(b) The Assuming Lender, if any, shall become a
Lender hereunder as of such Commitment Increase Date and the Commitment of any
Increasing Lender and such Assuming Lender shall be increased as of such
Commitment Increase Date; provided that:
(i) the Agent shall have received on or
prior to 9:00 a.m., Chicago time,
on such Commitment Increase Date a
certificate of a duly authorized
officer of the Borrower stating
that each of the applicable
conditions to such Commitment
Increase set forth in this Section
2.6.3 has been satisfied;
(ii) with respect to each Assuming
Lender, the Agent shall have
received, on or prior to 9:00 a.m.,
Chicago time, on such Commitment
Increase Date, an agreement, in
form and substance reasonably
satisfactory to the Borrower and
the Agent, pursuant to which such
Assuming Lender shall, effective as
of such Commitment Increase Date,
undertake a Commitment, duly
executed by such Assuming Lender
and the Borrower and acknowledged
by the Agent; and
(iii) each Increasing Lender shall have
delivered to the Agent, on or prior
to 9:00 a.m., Chicago time, on such
Commitment Increase Date,
confirmation in writing
satisfactory to the Agent as to its
increased Commitment, with a copy
of such confirmation to the
Borrower.
(c) Upon its receipt of confirmation from a
Lender that it is increasing its Commitment hereunder together with the
certificate referred to in Section 2.6.3(b)(i) above, the Agent shall (i) record
the information contained therein in the Register and (ii) give prompt notice
thereof to the Borrower. Upon its receipt of an agreement referred to in Section
2.6.3(b)(ii) above executed by an
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Assuming Lender, together with the certificate referred to in Section
2.6.3(b)(i) above, the Administrative Agent shall, if such agreement has been
completed, (x) accept such agreement, (y) record the information contained
therein in the Register and (z) give prompt notice thereof to the Borrower.
(d) In the event that the Agent shall have
received notice from the Borrower as to any agreement with respect to a
Commitment Increase on or prior to the relevant Commitment Increase Date and the
actions provided for in Sections 2.6.3(b)(i) through (b)(ii) above shall have
occurred by 9:00 a.m., New York City time, on such Commitment Increase Date, the
Agent shall notify the Lenders (including any Assuming Lenders) of the
occurrence of such Commitment Increase Date promptly on such date by facsimile
transmission or electronic messaging system. On the date of such Commitment
Increase, the Borrower shall (i) prepay the outstanding Advances (if any) and
any Swing Line Loan (if any) in full, (ii) simultaneously borrow new Advances
hereunder in an amount equal to such prepayment, so that, after giving effect
thereto the Advances are held ratably by the Lenders in accordance with the
respect Commitments of such Lenders (after giving effect to such Commitment
Increase and any Lender's Pro Rata Share of any LC Obligation) and (iii) pay to
the Lenders the amounts, if any, payable under Section 3.5.
2.7. Minimum Amount of Each Advance. Each Eurocurrency Advance
shall be in a minimum amount of $5,000,000 and in multiples of $ 1,000,000 if in
excess thereof (or the Approximate Equivalent Amounts if denominated in an
Agreed Currency other than Dollars), and each Floating Rate Advance (other than
an Advance to repay Swing Line Loans) shall be in the minimum amount of
$1,000,000 (and in multiples of $500,000 if in excess thereof), provided,
however, that any Floating Rate Advance may be in the amount of the Available
Aggregate Commitment.
2.8. Optional Principal Payments. The Borrower may from time to
time pay, without penalty or premium, all outstanding Floating Rate Advances
(other than Swing Line Loans), or, in a minimum aggregate amount of $1,000,000
or any integral multiple of $100,000 in excess thereof, any portion of the
outstanding Floating Rate Advances (other than Swing Line Loans) upon one
Business Days' prior notice to the Agent. The Borrower may at any time pay,
without penalty or premium, all outstanding Swing Line Loans, or, in a minimum
amount of $100,000 and increments of $50,000 in excess thereof, any portion of
the outstanding Swing Line Loans, with notice to the Agent and Swing Line Lender
by 11:00 a.m. (Chicago time) on the date of repayment. The Borrower may at any
time prior to the last day of the Interest Period, subject to the payment of any
funding indemnification amounts required by Section 3.4 but without penalty or
premium, pay all outstanding Eurocurrency Advances or any portion of the
outstanding Eurocurrency Advances upon three Business Days' prior notice to the
Agent.
2.9. Method of Selecting Types and Interest Periods for New
Advances. The Borrower shall select the Type of Advance and, in the case of each
Eurocurrency Advance, the Interest Period and Agreed Currency applicable thereto
from time to time. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than 10:00 a.m. (Chicago time) at least one
Business Day before the Borrowing Date of each Floating Rate Advance, three
Business Days before the Borrowing Date for each Eurocurrency Advance
denominated in Dollars and four Business Days before the Borrowing Date for each
Eurocurrency Advance denominated in an Agreed Currency other than Dollars,
specifying:
(a) the Borrowing Date, which shall be a
Business Day, of such Advance,
(b) the aggregate amount of such Advance,
(c) the Type of Advance selected, and
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(d) in the case of each Eurocurrency Advance,
the Interest Period and Agreed Currency
applicable thereto.
2.10. Conversion and Continuation of Outstanding Advances. Floating
Rate Advances (other than Swing Line Loans) shall continue as Floating Rate
Advances unless and until such Floating Rate Advances are converted into
Eurocurrency Advances pursuant to this Section 2.10 or are repaid in accordance
with Section 2.8. Each Eurocurrency Advance shall continue as a Eurocurrency
Advance until the end of the then applicable Interest Period therefor, at which
time:
(a) each such Eurocurrency Advance denominated in Dollars
shall be automatically converted into a Floating Rate
Advance unless (i) such Eurocurrency Advance is or
was repaid in accordance with Section 2.8 or (ii) the
Borrower shall have given the Agent a
Conversion/Continuation Notice (as defined below)
requesting that, at the end of such Interest Period,
such Eurocurrency Advance either continue as a
Eurocurrency Advance for the same or another Interest
Period or be converted into a Floating Rate Advance;
and
(b) each such Eurocurrency Advance denominated in an
Agreed Currency other than Dollars shall
automatically continue as a Eurocurrency Advance in
the same Agreed Currency with an Interest Period of
one month unless (i) such Eurocurrency Advance is or
was repaid in accordance with Section 2.8 or (ii) the
Borrower shall have given the Agent a
Conversion/Continuation Notice (as defined below)
requesting that, at the end of such Interest Period,
such Eurocurrency Advance continue as a Eurocurrency
Advance for the same or another Interest Period.
Subject to the terms of Section 2.10, the Borrower may elect from time to time
to convert all or any part of an Advance of any Type (other than a Swing Line
Loan) into any other Type or Types of Advances denominated in the same or any
other Agreed Currency; provided that any conversion of any Eurocurrency Advance
shall be made on, and only on, the last day of the Interest Period applicable
thereto. The Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of an Advance or
continuation of a Eurocurrency Advance not later than 10:00 a.m. (Chicago time)
at least one Business Day, in the case of a conversion into a Floating Rate
Advance, three Business Days, in the case of a conversion into or continuation
of a Eurocurrency Advance denominated in Dollars, or four Business Days, in the
case of a conversion into or continuation of a Eurocurrency Advance denominated
in an Agreed Currency other than Dollars, prior to the date of the requested
conversion or continuation, specifying:
(a) the requested date, which shall be a Business Day, of
such conversion or continuation, and
(b) the Agreed Currency, amount and Type(s) of Advance(s)
into which such Advance is to be converted or
continued and, in the case of a conversion into or
continuation of a Eurocurrency Advance, the duration
of the Interest Period applicable thereto.
2.11. Method of Borrowing. On each Borrowing Date, each Lender shall
make available its Loan or Loans, if any, (i) if such Loan is denominated in
Dollars, not later than noon, Chicago time, in Federal or other funds
immediately available to the Agent, in Chicago, Illinois at its address
specified in or pursuant to Article 13 and, (ii) if such Loan is denominated in
an Agreed Currency other than Dollars,
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not later than noon, local time, in the city of the Agent's Eurocurrency Payment
Office for such currency, in such funds as may then be customary for the
settlement of international transactions in such currency in the city of and at
the address of the Agent's Eurocurrency Payment Office for such currency. Unless
the Agent determines that any applicable condition specified in Article 4 has
not been satisfied, the Agent will make the funds so received from the Lenders
available to the Borrower at the Agent's aforesaid address. Notwithstanding the
foregoing provisions of this Section 2.11, to the extent that a Loan made by a
Lender matures on the Borrowing Date of a requested Loan, such Lender shall
apply the proceeds of the Loan it is then making to the repayment of principal
of the maturing Loan.
2.12. Changes in Interest Rate, etc. Each Floating Rate Advance
(other than a Swing Line Loan) shall bear interest on the outstanding principal
amount thereof, for each day from and including the date such Advance is made or
is converted from a Eurocurrency Advance into a Floating Rate Advance pursuant
to Section 2.10 to but excluding the date it becomes due or is converted into a
Eurocurrency Advance pursuant to Section 2.10 hereof, at a rate per annum equal
to the Floating Rate for such day. Each Swing Line Loan shall bear interest on
the outstanding principal amount thereof, for each day from and including the
day such Swing Line Loan is made to but excluding the date it is paid, at a rate
per annum equal to the Floating Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as a Floating Rate Advance
will take effect simultaneously with each change in the Alternate Base Rate.
Each Eurocurrency Advance shall bear interest on the outstanding principal
amount thereof from and including the first day of the Interest Period
applicable thereto to (but not including) the last day of such Interest Period
at the interest rate determined by the Agent as applicable to such Eurocurrency
Advance based upon the Borrower's selections under Sections 2.9 and 2.10 and
otherwise in accordance with the terms hereof. No Interest Period may end after
the Facility Termination Date. 2.13. Rates Applicable After Default.
Notwithstanding anything to the contrary contained in Section 2.9, 2.10 or 2.11,
during the continuance of a Default or Unmatured Default the Required Lenders
may, at their option, by notice to the Borrower, declare that no Advance may be
made as, converted into or continued as a Eurocurrency Advance. During the
continuance of a Default the Required Lenders may, at their option, by notice to
the Borrower, declare that (i) each Eurocurrency Advance shall bear interest for
the remainder of the applicable Interest Period at the rate otherwise applicable
to such Interest Period plus 2% per annum and (ii) each Floating Rate Advance
shall bear interest at a rate per annum equal to the Floating Rate in effect
from time to time plus 2% per annum, provided that, during the continuance of a
Default under Section 7.6 or 7.7, the interest rates set forth in clauses (i)
and (ii) above shall be applicable to all Advances without any election or
action on the part of the Agent or any Lender.
2.14. Method of Payment.
2.14.1. Timing of Payments. Each Advance shall be repaid and each
payment of interest thereon shall be paid in the currency in which such Advance
was made or, where such currency has converted to the Euro, in the Euro. All
payments of the Obligations hereunder shall be made, without setoff, deduction,
or counterclaim, in immediately available funds to the Agent at (except as set
forth in the next sentence) the Agent's address specified pursuant to Article
13, or at any other Lending Installation of the Agent specified in writing by
the Agent to the Borrower, by noon (local time) on the date when due and shall
(except with respect to repayments of Swing Line Loans) be applied ratably by
the Agent among the Lenders. All payments to be made by the Borrower hereunder
in any currency other than Dollars shall be made in such currency on the date
due in such funds as may then be customary for the settlement of international
transactions in such currency for the account of the Agent, at its Eurocurrency
Payment Office for such currency and shall be applied ratably by the Agent among
the Lenders. Each payment delivered to the Agent for the account of any Lender
shall be delivered promptly by the Agent to such Lender in the same type of
funds that the Agent received at, (a) with respect to
21
Floating Rate Advances and Eurocurrency Advances denominated in Dollars, its
address specified pursuant to Article 13 or at any Lending Installation
specified in a notice received by the Agent from such Lender and (b) with
respect to Eurocurrency Advances denominated in an Agreed Currency other than
Dollars, in the funds received from the Borrower at the address of the Agent's
Eurocurrency Payment Office for such currency. The Agent is hereby authorized to
charge any account of the Borrower maintained with Bank One or any of its
Affiliates for each payment, in the case of principal, one day after it becomes
due hereunder, in the case of interest, five days after it becomes due hereunder
and, in the case of fees, five days after it becomes due hereunder.
2.14.2. Currency Regulations. Notwithstanding the foregoing
provisions of Section 2.14.1, if, after the making of any Advance in any
currency other than Dollars, currency control or exchange regulations are
imposed in the country which issues such currency with the result that the type
of currency in which the Advance was made (the "Original Currency") no longer
exists or the Borrower is not able to make payment to the Agent for the account
of the Lenders in such Original Currency, then all payments to be made by the
Borrower hereunder in such currency shall instead be made when due in Dollars in
an amount equal to the Dollar Amount (as of the date of repayment) of such
payment due, it being the intention of the parties hereto that the Borrower take
all risks of the imposition of any such currency control or exchange
regulations. For purposes of this Section 2.14.2, the commencement of the third
stage of European Economic and Monetary Union and the occurrence of the Euro
Implementation Date shall not constitute the imposition of currency control or
exchange regulations.
2.15. Advances to be Made in Euro. If any Advance made (or to be
made) on or after the Euro Implementation Date would, but for the provisions of
this Section 2.15, be capable of being made in either the Euro or in a National
Currency Unit, such Advance shall be made in the Euro.
2.16. Noteless Agreement; Evidence of Indebtedness.
2.16.1. Lender's Records. Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
Indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
2.16.2. Agent's Records. The Agent shall maintain accounts in
which it will record (a) the amount of each Loan made hereunder, the Agreed
Currency and Type thereof and the Interest Period with respect thereto, (b) the
amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder and (c) the amount of any sum
received by the Agent hereunder from the Borrower and each Lender's share
thereof.
2.16.3. Prima Facie Evidence. The entries maintained in the
accounts maintained pursuant to Sections 2.16.1 and 2.16.2 above shall be prima
facie evidence of the existence and amounts of the Obligations therein recorded;
provided, however, that the failure of the Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the obligation of
the Borrower to repay the Obligations in accordance with their terms.
2.16.4. Notes. Any Lender may request that its Loans be
evidenced by a promissory note, or, in the case of the Swing Line Lender,
promissory notes representing its Revolving Loans and Swing Line Loans,
respectively, substantially in the form of Exhibit E, with appropriate changes
for notes evidencing Swing Line Loans (each a "Note"). In such event, the
Borrower shall prepare, execute and deliver to such Lender a Note payable to the
order of such Lender in a form supplied by the Agent. Thereafter, the Loans
evidenced by such Note and interest thereon shall at all times (prior to any
22
assignment pursuant to Section 12.3) be represented by one or more Notes payable
to the order of the payee named therein, except to the extent that any such
Lender subsequently returns any such Note for cancellation and requests that
such Loans once again be evidenced as described in Sections 2.16.1 and 2.16.2
above.
2.17. Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Agreed Currencies and Types of Advances and to transfer funds based on
telephonic notices made by any person or persons the Agent or any Lender in good
faith believes to be acting on behalf of the Borrower, it being understood that
the foregoing authorization is specifically intended to allow Borrowing Notices
and Conversion/Continuation Notices to be given telephonically. The Borrower
agrees to deliver promptly to the Agent a written confirmation, if such
confirmation is requested by the Agent or any Lender, of each telephonic notice
signed by an Authorized Officer. If the written confirmation differs in any
material respect from the action taken by the Agent and the Lenders, the records
of the Agent and the Lenders shall govern absent manifest error.
2.18. Interest Payment Dates; Interest and Fee Basis. Interest
accrued on each Floating Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof, on any date
on which the Floating Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on that portion of the outstanding
principal amount of any Floating Rate Advance converted into a Eurocurrency
Advance on a day other than a Payment Date shall be payable on the date of
conversion. Interest accrued on each Eurocurrency Advance shall be payable on
the last day of its applicable Interest Period, on any date on which the
Eurocurrency Advance is prepaid, whether by acceleration or otherwise, and at
maturity. Interest accrued on each Eurocurrency Advance having an Interest
Period longer than three months shall also be payable on the last day of each
three-month interval during such Interest Period. Interest and commitment fees
shall be calculated for actual days elapsed on the basis of a 360-day year,
except for interest on Advances denominated in British Pounds Sterling which
shall be calculated for actual days elapsed on the basis of a 365-day year.
Interest shall be payable for the day an Advance is made but not for the day of
any payment on the amount paid if payment is received prior to noon (local time)
at the place of payment. If any payment of principal of or interest on an
Advance shall become due on a day which is not a Business Day, such payment
shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.
2.19. Facility LCs.
2.19.1. Issuance. The LC Issuer hereby agrees, on the terms
and conditions set forth in this Agreement, to issue standby and commercial
letters of credit (each, a "Facility LC") and to renew, extend, increase,
decrease or otherwise modify each Facility LC ("Modify", and each such action a
"Modification"), from time to time from and including the date of this Agreement
and prior to the Facility Termination Date upon the request of the Borrower;
provided that immediately after each such Facility LC is issued or Modified, (i)
the aggregate amount of the outstanding LC Obligations shall not exceed
$40,000,000 and (ii) the Aggregate Outstanding Credit Exposure shall not exceed
the Aggregate Commitment. No Facility LC shall have an expiry date later than
the earlier of (x) the fifth Business Day prior to the Facility Termination Date
and (y) one year after its issuance, provided that any Facility LC with an
expiry date of one year after issuance may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the Facility
Termination Date.
2.19.2. Participations. Upon the issuance or Modification by
the LC Issuer of a Facility LC in accordance with this Section 2.19, the LC
Issuer shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably sold to each Lender, and each Lender shall be
23
deemed, without further action by any party hereto, to have unconditionally and
irrevocably purchased from the LC Issuer, a participation in such Facility LC
(and each Modification thereof) and the related LC Obligations in proportion to
its Pro Rata Share.
2.19.3. Notice. Subject to Section 2.19.1, the Borrower shall
give the LC Issuer notice prior to 10:00 a.m. (Chicago time) at least five
Business Days prior to the proposed date of issuance or Modification of each
Facility LC, specifying the beneficiary, the proposed date of issuance (or
Modification) and the expiry date of such Facility LC, and describing the
proposed terms of such Facility LC and the nature of the transactions proposed
to be supported thereby. Upon receipt of such notice, the LC Issuer shall
promptly notify the Agent, and the Agent shall promptly notify each Lender, of
the contents thereof and of the amount of such Lender's participation in such
proposed Facility LC. The issuance or Modification by the LC Issuer of any
Facility LC shall, in addition to the conditions precedent set forth in Article
4 (the satisfaction of which the LC Issuer shall have no duty to ascertain), be
subject to the conditions precedent that such Facility LC shall be satisfactory
to the LC Issuer and that the Borrower shall have executed and delivered such
application agreement and/or such other instruments and agreements relating to
such Facility LC as the LC Issuer shall have reasonably requested (each, a
"Facility LC Application"). In the event of any conflict between the terms of
this Agreement and the terms of any Facility LC Application, the terms of this
Agreement shall control.
2.19.4. LC Fees. The Borrower shall pay to the Agent, for the
account of the Lenders ratably in accordance with their respective Pro Rata
Shares, with respect to each Facility LC, a one-time letter of credit fee in an
amount equal to the percentage rate per annum identified as the Facility LC Fee,
as set forth in the Pricing Schedule, of the initial stated amount (or, with
respect to a Modification of any such Facility LC which increases the stated
amount thereof, such increase in the stated amount) thereof, such fee to be
payable on the last day of each three-month interval prior to its expiry date
(each such fee described in this sentence an "LC Fee"). The Borrower shall also
pay to the LC Issuer for its own account (x) at the time of issuance of each
Facility LC, a fronting fee in an amount equal to 0.125% of the initial stated
amount (or, with respect to a Modification of any such Facility LC which
increases the stated amount thereof, such increase in the stated amount)
thereof, and (y) documentary and processing charges in connection with the
issuance or Modification of and draws under Facility LCs in accordance with the
LC Issuer's standard schedule for such charges as in effect from time to time.
2.19.5. Administration; Reimbursement by Lenders. Upon
receipt from the beneficiary of any Facility LC of any demand for payment under
such Facility LC, the LC Issuer shall notify the Agent and the Agent shall
promptly notify the Borrower and each other Lender as to the amount to be paid
by the LC Issuer as a result of such demand and the proposed payment date (the
"LC Payment Date"). The responsibility of the LC Issuer to the Borrower and each
Lender shall be only to determine that the documents (including each demand for
payment) delivered under each Facility LC in connection with such presentment
shall be in conformity in all material respects with such Facility LC. The LC
Issuer shall endeavor to exercise the same care in the issuance and
administration of the Facility LCs as it does with respect to letters of credit
in which no participations are granted, it being understood that in the absence
of any gross negligence or willful misconduct by the LC Issuer, each Lender
shall be unconditionally and irrevocably liable without regard to the occurrence
of any Default or any condition precedent whatsoever, to reimburse the LC Issuer
on demand for (i) such Lender's Pro Rata Share of the amount of each payment
made by the LC Issuer under each Facility LC to the extent such amount is not
reimbursed by the Borrower pursuant to Section 2.19.6 below, plus (ii) interest
on the foregoing amount to be reimbursed by such Lender, for each day from the
date of the LC Issuer's demand for such reimbursement (or, if such demand is
made after 11:00 a.m. (Chicago time) on such date, from the next succeeding
Business Day) to the date on which such Lender pays the amount to be reimbursed
by it, at a
24
rate of interest per annum equal to the Federal Funds Effective Rate for the
first three days and, thereafter, at a rate of interest equal to the rate
applicable to Floating Rate Advances.
2.19.6. Reimbursement by Borrower. The Borrower shall be
irrevocably and unconditionally obligated to reimburse the LC Issuer on or
before the applicable LC Payment Date for any amounts to be paid by the LC
Issuer upon any drawing under any Facility LC, without presentment, demand,
protest or other formalities of any kind; provided that neither the Borrower nor
any Lender shall hereby be precluded from asserting any claim for direct (but
not consequential) damages suffered by the Borrower or such Lender to the
extent, but only to the extent, caused by (i) the willful misconduct or gross
negligence of the LC Issuer in determining whether a request presented under any
Facility LC issued by it complied with the terms of such Facility LC or (ii) the
LC Issuer's failure to pay under any Facility LC issued by it after the
presentation to it of a request strictly complying with the terms and conditions
of such Facility LC. All such amounts paid by the LC Issuer and remaining unpaid
by the Borrower shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to (x) the rate applicable to Floating Rate Advances
for such day if such day falls on or before the applicable LC Payment Date and
(y) the sum of 2% plus the rate applicable to Floating Rate Advances for such
day if such day falls after such LC Payment Date. The LC Issuer will pay to each
Lender ratably in accordance with its Pro Rata Share all amounts received by it
from the Borrower for application in payment, in whole or in part, of the
Reimbursement Obligation in respect of any Facility LC issued by the LC Issuer,
but only to the extent such Lender has made payment to the LC Issuer in respect
of such Facility LC pursuant to Section 2.19.5. Subject to the terms and
conditions of this Agreement (including without limitation the submission of a
Borrowing Notice in compliance with Section 2.9 and the satisfaction of the
applicable conditions precedent set forth in Article 4), the Borrower may
request an Advance hereunder for the purpose of satisfying any Reimbursement
Obligation.
2.19.7. Obligations Absolute. The Borrower's obligations
under this Section 2.19 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the LC Issuer, any Lender or any
beneficiary of a Facility LC. The Borrower further agrees with the LC Issuer and
the Lenders that the LC Issuer and the Lenders shall not be responsible for, and
the Borrower's Reimbursement Obligation in respect of any Facility LC shall not
be affected by, among other things, the validity or genuineness of documents or
of any endorsements thereon, even if such documents should in fact prove to be
in any or all respects invalid, fraudulent or forged, or any dispute between or
among the Borrower, any of its Affiliates, the beneficiary of any Facility LC or
any financing institution or other party to whom any Facility LC may be
transferred or any claims or defenses whatsoever of the Borrower or of any of
its Affiliates against the beneficiary of any Facility LC or any such
transferee. The LC Issuer shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Facility LC. The Borrower
agrees that any action taken or omitted by the LC Issuer or any Lender under or
in connection with each Facility LC and the related drafts and documents, if
done without gross negligence or willful misconduct, shall be binding upon the
Borrower and shall not put the LC Issuer or any Lender under any liability to
the Borrower. Nothing in this Section 2.19.7 is intended to limit the right of
the Borrower to make a claim against the LC Issuer for damages as contemplated
by the proviso to the first sentence of Section 2.19.6.
2.19.8. Actions of LC Issuer. The LC Issuer shall be entitled
to rely, and shall be fully protected in relying, upon any Facility LC, draft,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the LC Issuer.
The LC Issuer shall be fully justified in failing or refusing to take any action
25
under this Agreement unless it shall first have received such advice or
concurrence of the Required Lenders as it reasonably deems appropriate or it
shall first be indemnified to its reasonable satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. Notwithstanding any other
provision of this Section 2.19, the LC Issuer shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon the
Lenders and any future holders of a participation in any Facility LC.
2.19.9. Indemnification. The Borrower hereby agrees to
indemnify and hold harmless each Lender, the LC Issuer and the Agent, and their
respective directors, officers, agents and employees from and against any and
all claims and damages, losses, liabilities, costs or expenses which such
Lender, the LC Issuer or the Agent may incur (or which may be claimed against
such Lender, the LC Issuer or the Agent by any Person whatsoever) by reason of
or in connection with the issuance, execution and delivery or transfer of or
payment or failure to pay under any Facility LC or any actual or proposed use of
any Facility LC, including, without limitation, any claims, damages, losses,
liabilities, costs or expenses which the LC Issuer may incur by reason of or in
connection with (i) the failure of any other Lender to fulfill or comply with
its obligations to the LC Issuer hereunder (but nothing herein contained shall
affect any rights the Borrower may have against any defaulting Lender) or (ii)
by reason of or on account of the LC Issuer issuing any Facility LC which
specifies that the term "Beneficiary" included therein includes any successor by
operation of law of the named Beneficiary, but which Facility LC does not
require that any drawing by any such successor Beneficiary be accompanied by a
copy of a legal document, satisfactory to the LC Issuer, evidencing the
appointment of such successor Beneficiary; provided that the Borrower shall not
be required to indemnify any Lender, the LC Issuer or the Agent for any claims,
damages, losses, liabilities, costs or expenses to the extent, but only to the
extent, caused by (x) the willful misconduct or gross negligence of the LC
Issuer in determining whether a request presented under any Facility LC complied
with the terms of such Facility LC or (y) the LC Issuer's failure to pay under
any Facility LC after the presentation to it of a request strictly complying
with the terms and conditions of such Facility LC. Nothing in this Section
2.19.9 is intended to limit the obligations of the Borrower under any other
provision of this Agreement.
2.19.10. Lenders' Indemnification. Each Lender shall, ratably
in accordance with its Pro Rata Share, indemnify the LC Issuer, its Affiliates
and their respective directors, officers, agents and employees (to the extent
not reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitees' gross negligence or willful
misconduct or the LC Issuer's failure to pay under any Facility LC after the
presentation to it of a request strictly complying with the terms and conditions
of the Facility LC) that such indemnitees may suffer or incur in connection with
this Section 2.19 or any action taken or omitted by such indemnitees hereunder.
2.19.11. Rights as a Lender. In its capacity as a Lender, the
LC Issuer shall have the same rights and obligations as any other Lender.
2.20. Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Swing Line Borrowing Notice, Conversion/Continuation Notice,
and repayment notice received by it hereunder. The Agent will notify each Lender
of the interest rate applicable to each Eurocurrency Advance promptly upon
determination of such interest rate and will give each Lender prompt notice of
each change in the Alternate Base Rate.
26
2.21. Lending Installations. Each Lender will book its Loans at the
appropriate Lending Installation listed on Schedule 4 or such other Lending
Installation designated by such Lender in accordance with the final sentence of
this Section 2.21. All terms of this Agreement shall apply to any such Lending
Installation and the Loans and any Notes issued hereunder shall be deemed held
by each Lender for the benefit of any such Lending Installation. Each Lender
may, by written notice to the Agent and the Borrower in accordance with Article
13, designate replacement or additional Lending Installations through which
Loans will be made by it and for whose account Loan payments are to be made.
2.22. Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (x) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
2.23. Market Disruption. Notwithstanding the satisfaction of all
conditions referred to in Article 2 and Article 4 with respect to any Advance in
any Agreed Currency other than Dollars, if there shall occur on or prior to the
date of such Advance any change in national or international financial,
political or economic conditions or currency exchange rates or exchange controls
which would in the reasonable opinion of the Agent or the Required Lenders make
it impracticable for the Eurocurrency Loans comprising such Advance to be
denominated in the Agreed Currency specified by the Borrower, then the Agent
shall forthwith give notice thereof to the Borrower and the Lenders, and such
Loans shall not be denominated in such Agreed Currency but shall, except as
otherwise set forth in Section 2.14, be made on such Borrowing Date in Dollars,
in an aggregate principal amount equal to the Dollar Amount of the aggregate
principal amount specified in the related Borrowing Notice or
Conversion/Continuation Notice, as the case may be, as Floating Rate Loans,
unless the Borrower notifies the Agent at least one Business Day before such
date that (i) it elects not to borrow on such date or (ii) it elects to borrow
on such date in a different Agreed Currency, as the case may be, in which the
denomination of such Loans would in the opinion of the Agent and the Required
Lenders be practicable and in an aggregate principal amount equal to the Dollar
Amount of the aggregate principal amount specified in the related Borrowing
Notice or Conversion/Continuation Notice, as the case may be.
2.24. Judgment Currency. If for the purposes of obtaining judgment
in any court it is necessary to convert a sum due from the Borrower hereunder in
the currency expressed to be payable herein (the "specified currency") into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Agent could purchase the specified
currency with such other currency at the Agent's main Chicago office on the
Business Day preceding that on which final, non-appealable judgment is given.
The obligations of the Borrower in respect of any sum due to any Lender or the
Agent hereunder shall, notwithstanding any judgment in a currency other than the
specified currency, be discharged only to the extent that on the Business Day
following receipt by such Lender or the Agent (as the case may be) of any sum
adjudged to be so due in such other currency such Lender or the Agent (as the
case may be) may in accordance with normal, reasonable banking procedures
purchase the specified currency with such other
27
currency. If the amount of the specified currency so purchased is less than the
sum originally due to such Lender or the Agent, as the case may be, in the
specified currency, the Borrower agrees, to the fullest extent that it may
effectively do so, as a separate obligation and notwithstanding any such
judgment, to indemnify such Lender or the Agent, as the case may be, against
such loss, and if the amount of the specified currency so purchased exceeds (a)
the sum originally due to any Lender or the Agent, as the case may be, in the
specified currency and (b) any amounts shared with other Lenders as a result of
allocations of such excess as a disproportionate payment to such Lender under
Section 11.2, such Lender or the Agent, as the case may be, agrees to remit such
excess to the Borrower.
2.25. Replacement of Lender. If the Borrower is required pursuant to
Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any
Lender's obligation to make or continue, or to convert Floating Rate Advances
into, Eurocurrency Advances shall be suspended pursuant to Section 3.3 (any
Lender so affected an "Affected Lender"), the Borrower may elect, if such
amounts continue to be charged or such suspension is still effective, to replace
such Affected Lender as a Lender party to this Agreement, provided that no
Default or Unmatured Default shall have occurred and be continuing at the time
of such replacement, and provided further that, concurrently with such
replacement, (i) another bank or other entity which is reasonably satisfactory
to the Borrower and the Agent shall agree, as of such date, to purchase for cash
the Advances and other Obligations due to the Affected Lender pursuant to an
assignment substantially in the form of Exhibit C and to become a Lender for all
purposes under this Agreement and to assume all obligations of the Affected
Lender to be terminated as of such date and to comply with the requirements of
Section 12.3 applicable to assignments, and (ii) the Borrower shall pay to such
Affected Lender in same day funds on the day of such replacement (A) all
interest, fees and other amounts then accrued but unpaid to such Affected Lender
by the Borrower hereunder to and including the date of termination, including
without limitation payments due to such Affected Lender under Sections 3.1, 3.2
and 3.5, and (B) an amount, if any, equal to the payment which would have been
due to such Lender on the day of such replacement under Section 3.4 had the
Loans of such Affected Lender been prepaid on such date rather than sold to the
replacement Lender.
2.26. Limitation of Interest. The Borrower, the Agent and the
Lenders intend to strictly comply with all applicable laws, including applicable
usury laws. Accordingly, the provisions of this Section 2.26 shall govern and
control over every other provision of this Agreement or any other Loan Document
which conflicts or is inconsistent with this Section 2.26, even if such
provision declares that it controls. As used in this Section 2.26, the term
"interest" includes the aggregate of all charges, fees, benefits or other
compensation which constitute interest under applicable law, provided that, to
the maximum extent permitted by applicable law, (a) any non-principal payment
shall be characterized as an expense or as compensation for something other than
the use, forbearance or detention of money and not as interest, and (b) all
interest at any time contracted for, reserved, charged or received shall be
amortized, prorated, allocated and spread, in equal parts during the full term
of the Obligations. In no event shall the Borrower or any other Person be
obligated to pay, or any Lender have any right or privilege to reserve, receive
or retain, (a) any interest in excess of the maximum amount of nonusurious
interest permitted under the laws of the State of Illinois or the applicable
laws (if any) of the United States or of any other applicable state, or (b)
total interest in excess of the amount which such Lender could lawfully have
contracted for, reserved, received, retained or charged had the interest been
calculated for the full term of the Obligations at the Highest Lawful Rate. On
each day, if any, that the interest rate (the "Stated Rate") called for under
this Agreement or any other Loan Document exceeds the Highest Lawful Rate, the
rate at which interest shall accrue shall automatically be fixed by operation of
this sentence at the Highest Lawful Rate for that day, and shall remain fixed at
the Highest Lawful Rate for each day thereafter until the total amount of
interest accrued equals the total amount of interest which would have accrued if
there were no such ceiling rate as is imposed by this sentence. Thereafter,
interest shall accrue at the Stated Rate unless and until the Stated Rate again
exceeds the Highest Lawful Rate when the provisions of the
28
immediately preceding sentence shall again automatically operate to limit the
interest accrual rate. The daily interest rates to be used in calculating
interest at the Highest Lawful Rate shall be determined by dividing the
applicable Highest Lawful Rate per annum by the number of days in the calendar
year for which such calculation is being made. None of the terms and provisions
contained in this Agreement or in any other Loan Document which directly or
indirectly relate to interest shall ever be construed without reference to this
Section 2.21, or be construed to create a contract to pay for the use,
forbearance or detention of money at an interest rate in excess of the Highest
Lawful Rate. If the term of any Obligation is shortened by reason of
acceleration of maturity as a result of any Default or by any other cause, or by
reason of any required or permitted prepayment, and if for that (or any other)
reason any Lender at any time, including but not limited to, the stated
maturity, is owed or receives (and/or has received) interest in excess of
interest calculated at the Highest Lawful Rate, then and in any such event all
of any such excess interest shall be canceled automatically as of the date of
such acceleration, prepayment or other event which produces the excess, and, if
such excess interest has been paid to such Lender, it shall be credited pro
tanto against the then-outstanding principal balance of the Borrower's
obligations to such Lender, effective as of the date or dates when the event
occurs which causes it to be excess interest, until such excess is exhausted or
all of such principal has been fully paid and satisfied, whichever occurs first,
and any remaining balance of such excess shall be promptly refunded to its
payor.
ARTICLE
3.
YIELD PROTECTION; TAXES
3.1. Yield Protection. If, on or after the date of this Agreement,
the adoption of any law or any governmental or quasi-governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law), or any change in the interpretation or administration thereof by any
governmental or quasi-governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Lender or applicable Lending Installation or the LC Issuer with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency:
(a) subjects any Lender or any applicable Lending
Installation or the LC Issuer to any Taxes, or
changes the basis of taxation of payments (other than
with respect to Excluded Taxes) to any Lender or the
LC Issuer in respect of its Eurocurrency Loans,
Facility LCs or participations therein, or
(b) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or
similar requirement against assets of, deposits with
or for the account of, or credit extended by, any
Lender or any applicable Lending Installation or the
LC Issuer (other than reserves and assessments taken
into account in determining the interest rate
applicable to Eurocurrency Advances), or
(c) imposes any other condition the result of which is to
increase the cost to any Lender or any applicable
Lending Installation or the LC Issuer of making,
funding or maintaining its Eurocurrency Loans, or of
issuing or participating in Facility LCs, or reduces
any amount receivable by any Lender or any applicable
Lending Installation or the LC Issuer in connection
with its Eurocurrency Loans, Facility LCs or
participations therein, or requires any Lender or any
applicable Lending Installation or the LC Issuer to
make any payment calculated by reference to the
amount of Eurocurrency Loans, Facility LCs or
participations
29
therein held or interest or LC Fees received by it,
by an amount deemed material by such Lender or the LC
Issuer as the case may be,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, of making
or maintaining its Eurocurrency Loans or Commitment or of issuing or
participating in Facility LCs or to reduce the return received by such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, in
connection with such Eurocurrency Loans, Commitment, Facility LCs or
participations therein, then, within 15 days of demand by such Lender, or the LC
Issuer, as the case may be, the Borrower shall pay such Lender or the LC Issuer,
as the case may be, such additional amount or amounts as will compensate such
Lender or the LC Issuer, as the case may be, for such increased cost or
reduction in amount received.
3.2. Changes in Capital Adequacy Regulations. If a Lender or the LC
Issuer determines the amount of capital required or expected to be maintained by
such Lender or the LC Issuer, any Lending Installation of such Lender or the LC
Issuer, or any corporation controlling such Lender or the LC Issuer is increased
as a result of a Change, then, within 15 days of demand by such Lender or the LC
Issuer, the Borrower shall pay such Lender or the LC Issuer the amount necessary
to compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender or the LC Issuer determines is attributable
to this Agreement, its Outstanding Credit Exposure or its Commitment to make
Loans and issue or participate in Facility LCs, as the case may be, hereunder
(after taking into account such Lender's or the LC Issuer's policies as to
capital adequacy). "Change" means (i) any change after the date of this
Agreement in the Risk-Based Capital Guidelines or (ii) any adoption of or change
in any other law, governmental or quasi-governmental rule, regulation, policy,
guideline, interpretation, or directive (whether or not having the force of law)
after the date of this Agreement which affects the amount of capital required or
expected to be maintained by any Lender or the LC Issuer or any Lending
Installation or any corporation controlling any Lender, the LC Issuer or any
Lending Installation. "Risk-Based Capital Guidelines" means (i) the risk-based
capital guidelines in effect in the United States on the date of this Agreement,
including transition rules, and (ii) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the
July 1988 report of the Basle Committee on Banking Regulation and Supervisory
Practices Entitled "International Convergence of Capital Measurements and
Capital Standards," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement.
3.3. Availability of Types of Advances. If any Lender determines
that maintenance of its Eurocurrency Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type, currency and maturity appropriate to match fund Eurocurrency Advances
are not available or (ii) the interest rate applicable to Eurocurrency Advances
does not accurately reflect the cost of making or maintaining Eurocurrency
Advances, then the Agent shall suspend the availability of Eurocurrency Advances
and require any affected Eurocurrency Advances to be repaid or converted to
Floating Rate Advances, subject to the payment of any funding indemnification
amounts required by Section 3.4.
3.4. Funding Indemnification. If any payment of a Eurocurrency
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or a
Eurocurrency Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Eurocurrency Advance.
30
3.5. Taxes.
3.5.1. No Offset for Taxes. All payments by the Borrower to
or for the account of any Lender, the LC Issuer or the Agent hereunder or under
any Note or Facility LC Application shall be made free and clear of and without
deduction for any and all Taxes. If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder to any Lender,
the IC Issuer or the Agent, (a) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 3.5) such Lender, the LC Issuer or
the Agent (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (b) the Borrower shall make such
deductions, (c) the Borrower shall pay the full amount deducted to the relevant
authority in accordance with applicable law and (d) the Borrower shall furnish
to the Agent the original copy of a receipt evidencing payment thereof within 30
days after such payment is made.
3.5.2. Payment of Other Taxes. In addition, the Borrower
hereby agrees to pay any present or future stamp or documentary taxes and any
other excise or property taxes, charges or similar levies which arise from any
payment made hereunder or under any Note or Facility LC Application or from the
execution or delivery of, or otherwise with respect to, this Agreement or any
Note or Facility LC Application ("Other Taxes").
3.5.3. Tax Indemnity. The Borrower hereby agrees to
indemnify the Agent, the LC Issuer and each Lender for the full amount of Taxes
or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed
on amounts payable under this Section 3.5) paid by the Agent, the LC Issuer or
such Lender as a result of its Commitment, any Loans made by it hereunder, or
otherwise in connection with its participation in this Agreement and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto. Payments due under this indemnification shall be made within 30
days of the date the Agent, the LC Issuer or such Lender makes demand therefor
pursuant to Section 3.6.
3.5.4. Non-U.S. Lenders. Each Lender that is not
incorporated under the laws of the United States of America or a state thereof
(each a "Non-U.S. Lender") agrees that it will, not more than ten Business Days
after the date of this Agreement, (i) deliver to the Agent two duly completed
copies of United States Internal Revenue Service Form W-8BEN or W-8ECI,
certifying in either case that such Lender is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes, and (ii) deliver to the Agent a United States Internal Revenue
Form W-8 or W-9, as the case may be, and certify that it is entitled to an
exemption from United States backup withholding tax. Each Non-U.S. Lender
further undertakes to deliver to each of the Borrower and the Agent (x) renewals
or additional copies of such form (or any successor form) on or before the date
that such form expires or becomes obsolete, and (y) after the occurrence of any
event requiring a change in the most recent forms so delivered by it, such
additional forms or amendments thereto as may be reasonably requested by the
Borrower or the Agent. All forms or amendments described in the preceding
sentence shall certify that such Lender is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes, unless an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form or amendment with respect to it and such Lender advises the Borrower and
the Agent that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
31
3.5.5. Exception to Tax Indemnity. For any period during
which a Non-U.S. Lender has failed to provide the Borrower with an appropriate
form pursuant to Section 3.5.4, above (unless such failure is due to a change in
treaty, law or regulation, or any change in the interpretation or administration
thereof by any governmental authority, occurring subsequent to the date on which
a form originally was required to be provided), such Non-U.S. Lender shall not
be entitled to indemnification under this Section 3.5 with respect to Taxes
imposed by the United States; provided that, should a Non-U.S. Lender which is
otherwise exempt from or subject to a reduced rate of withholding tax become
subject to Taxes because of its failure to deliver a form required under Section
3.5.4, above, the Borrower shall take such steps as such Non-U.S. Lender shall
reasonably request to assist such Non-U.S. Lender to recover such Taxes.
3.5.6. Additional Documentation. Any Lender that is entitled
to an exemption from or reduction of withholding tax with respect to payments
under this Agreement or any Note pursuant to the law of any relevant
jurisdiction or any treaty shall deliver to the Borrower (with a copy to the
Agent), at the time or times prescribed by applicable law, such properly
completed and executed documentation prescribed by applicable law as will permit
such payments to be made without withholding or at a reduced rate.
3.5.7. Agent Indemnification. If the U.S. Internal Revenue
Service or any other governmental authority of the United States or any other
country or any political subdivision thereof asserts a claim that the Agent did
not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or properly completed, because
such Lender failed to notify the Agent of a change in circumstances which
rendered its exemption from withholding ineffective, or for any other reason),
such Lender shall indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax, withholding therefor, or otherwise, including
penalties and interest, and including taxes imposed by any jurisdiction on
amounts payable to the Agent under this subsection, together with all costs and
expenses related thereto (including attorneys fees and time charges of attorneys
for the Agent, which attorneys may be employees of the Agent). The obligations
of the Lenders under this Section 3.5.7 shall survive the payment of the
Obligations and termination of this Agreement.
3.6. Lender Statements; Survival of Indemnity. To the
extent reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurocurrency Loans to reduce any liability of
the Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or to avoid the
unavailability of Eurocurrency Advances under Section 3.3, so long as such
designation is not, in the judgment of such Lender, disadvantageous to such
Lender. Each Lender shall deliver a written statement of such Lender to the
Borrower (with a copy to the Agent) as to the amount due, if any, under Section
3.1, 3.2, 3.4 or 3.5. Such written statement shall set forth in reasonable
detail the calculations upon which such Lender determined such amount and shall
be final, conclusive and binding on the Borrower in the absence of manifest
error. Determination of amounts payable under such Sections in connection with a
Eurocurrency Loan shall be calculated as though each Lender funded its
Eurocurrency Loan through the purchase of a deposit of the type, currency and
maturity corresponding to the deposit used as a reference in determining the
Eurocurrency Rate applicable to such Loan, whether in fact that is the case or
not. Unless otherwise provided herein, the amount specified in the written
statement of any Lender shall be payable on demand after receipt by the Borrower
of such written statement. The obligations of the Borrower under Sections 3.1,
3.2, 3.4 and 3.5 shall survive payment of the Obligations and termination of
this Agreement.
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ARTICLE
4.
CONDITIONS PRECEDENT
4.1. Initial Credit Extension. The Lenders shall not be required to
make the initial Credit Extension hereunder unless the Borrower has furnished to
the Agent with sufficient copies for the Lenders:
(a) Copies of the certificate of incorporation of the
Borrower and the Guarantors, together with all amendments, and a certificate of
good standing, each certified by the appropriate governmental officer in its
jurisdiction of incorporation and in every jurisdiction where the Borrower and
each Guarantor are qualified to do business;
(b) Copies, certified by the Secretary or Assistant
Secretary of the Borrower and each Guarantor, of its respective by-laws and of
its Board of Directors' resolutions and of resolutions or actions of any other
body authorizing the execution of the Loan Documents to which the Borrower and
each Guarantor (as applicable) is a party;
(c) An incumbency certificate, executed by the Secretary
or Assistant Secretary of the Borrower and each Guarantor, which shall identify
by name and title and bear the signatures of the Authorized Officers and any
other officers of the Borrower authorized to sign the Loan Documents to which
the Borrower is a party, upon which certificate the Agent and the Lenders shall
be entitled to rely until informed of any change in writing by the Borrower;
(d) A written opinion of the Borrower's and Guarantors'
counsel, addressed to the Lenders in substantially the form of Exhibit A;
(e) A certificate, signed by the Chief Financial Officer
of the Borrower, stating that on the initial Credit Extension Date no Default or
Unmatured Default has occurred and is continuing;
(f) Any Notes requested by a Lender pursuant to Section
2.16 payable to the order of each such requesting Lender;
(g) Written money transfer instructions, in substantially
the form of Exhibit D, addressed to the Agent and signed by an Authorized
Officer, together with such other related money transfer authorizations as the
Agent may have reasonably requested;
(h) If the initial Credit Extension will be the issuance
of a Facility LC, a properly completed Facility LC Application;
(i) The insurance certificate described in Section 5.20;
(j) The Agent shall have determined that (a) since
January 10, 2003, there is an absence of any material adverse change or
disruption in primary or secondary loan syndication markets, financial markets
or in capital markets generally that would likely impair syndication of the
Loans hereunder and (b) the Borrower has fully cooperated with the Agent's
syndication efforts including, without limitation, by providing the Agent with
information regarding the Borrower's operations and prospects and such other
information as the Agent deems necessary to successfully syndicate the Loans
hereunder;
33
(k) Evidence that (i) the Borrower shall have paid in
full all principal of and interest accrued on the outstanding loans under the
Existing Credit Agreement and all fees, expenses and other amounts owing by the
Borrower thereunder and (ii) the Commitments (as defined in the Existing Credit
Agreement) have terminated; and
(l) Such other documents as any Lender or its counsel may
have reasonably requested.
4.2. Each Credit Extension. The Lenders shall not (except as
otherwise set forth in Section 2.5.4 with respect to Revolving Loans for the
purpose of repaying Swing Line Loans) be required to make any Credit Extensions
unless on the applicable Credit Extension Date:
(a) There exists no Default or Unmatured Default;
(b) The representations and warranties contained in
Article 5 are true and correct as of such Credit Extension Date except to the
extent any such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall have been true
and correct on and as of such earlier date; and
(c) All legal matters incident to the making of such
Credit Extension shall be satisfactory to the Lenders and their counsel.
Each Borrowing Notice, Swing Line Borrowing Notice or request for issuance of a
Facility LC, as the case may be, with respect to each such Credit Extension
shall constitute a representation and warranty by the Borrower and each
Guarantor that the conditions contained in Sections 4.2(a) and 4.2(b) have been
satisfied. Any Lender may require a duly completed compliance certificate in
substantially the form of Exhibit B as a condition to making a Credit Extension.
ARTICLE
5.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1. Existence and Standing. Each of the Borrower and its
Subsidiaries is a corporation, duly and properly incorporated or organized, as
the case may be, validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization and has all requisite authority to
conduct its business in each jurisdiction in which its business is conducted.
Each of the Borrower and its Subsidiaries is qualified to do business in, and is
in good standing in, every jurisdiction were such qualification is required,
except where the failure to be so qualified or in good standing could not
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect.
5.2. Authorization and Validity. The Borrower has the power and
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by the Borrower
of the Loan Documents and the performance of its obligations thereunder have
been duly authorized by proper corporate proceedings, and the Loan Documents to
which the Borrower is a party constitute legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally.
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5.3. No Conflict; Government Consent. Neither the execution and
delivery by the Borrower of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate (i) any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on the Borrower or any of its Subsidiaries or (ii) the
Borrower's or any Subsidiary's articles or certificate of incorporation or
by-laws, or (iii) the provisions of any indenture, material instrument or
agreement to which the Borrower or any of its Subsidiaries is a party or is
subject, or by which it, or its Property, is bound, or conflict with or
constitute a default thereunder, or result in, or require, the creation or
imposition of any Lien in, of or on the Property of the Borrower or a Subsidiary
pursuant to the terms of any such indenture, instrument or agreement. No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its Subsidiaries,
is required to be obtained by the Borrower or any of its Subsidiaries in
connection with the execution and delivery of the Loan Documents, the borrowings
under this Agreement, the payment and performance by the Borrower of the
Obligations or the legality, validity, binding effect or enforceability of any
of the Loan Documents.
5.4. Financial Statements. The Borrower has heretofore furnished to
the Lenders its consolidated balance sheet and statements of income,
shareholders' equity and cash flows as of and for the fiscal year ended November
30, 2002 reported on by its independent public accountants, certified by the
Chief Financial Officer of the Borrower. Such financial statements present
fairly, in all material respects, the consolidated financial condition and
results of operations and cash flows of the Borrower and its Subsidiaries as of
such dates and for such periods in accordance with GAAP consistently applied.
5.5. Material Adverse Change. Since November 30, 2002 there has
been no change in the business, Property, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect.
5.6. Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith and as to which adequate
reserves have been provided in accordance with GAAP consistently applied and as
to which no Lien exists. The United States income tax returns of the Borrower
and its Subsidiaries have been audited by the Internal Revenue Service through
the fiscal year ended November 30, 2000. No tax Liens have been filed and no
material claims are being asserted with respect to any such taxes. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in
respect of any taxes or other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. Except as disclosed in
the Borrower's Annual Report on Form 10-K for the fiscal year ended November 30,
2002, and in Schedule 5.7, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect or which seeks to prevent, enjoin or delay the making of any Credit
Extensions. Other than any liability incident to any litigation, arbitration or
proceeding which (i) could not reasonably be expected to have a Material Adverse
Effect or (ii) is set forth on Schedule 5.7, the Borrower has no material
Contingent Obligations not provided for or disclosed in the financial statements
referred to in Section 5.4.
5.8. Subsidiaries. Schedule 1 contains an accurate list of all
Subsidiaries of the Borrower as of the date of this Agreement, setting forth
their respective jurisdictions of organization and the
35
percentage of their respective capital stock or other ownership interests owned
by the Borrower or other Subsidiaries. All of the issued and outstanding shares
of capital stock or other ownership interests of such Subsidiaries have been (to
the extent such concepts are relevant with respect to such ownership interests)
duly authorized and issued and are fully paid and non-assessable. The Domestic
Subsidiaries having total assets of not less than 95% of the total assets of all
Domestic Subsidiaries are Guarantors.
5.9. ERISA. At November 30, 2002, the Unfunded Liabilities of all
Single Employer Plans did not in the aggregate exceed $16,467,000. Neither the
Borrower nor any other member of the Controlled Group has incurred, or is
reasonably expected to incur, any withdrawal liability to Multiemployer Plans
which could reasonably be expected to have a Material Adverse Effect. Each Plan
complies in all material respects with all applicable requirements of law and
regulations, no Reportable Event has occurred with respect to any Plan, neither
the Borrower nor any other member of the Controlled Group has withdrawn from any
Plan or initiated steps to do so, and no steps have been taken to terminate any
Plan, and each Plan that is intended to be qualified under Section 401(a) of the
Code has been determined by the Internal Revenue Service to be so qualified.
5.10. Accuracy of Information. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact necessary to make the statements contained therein not misleading
(it being understood that with respect to projections, such projections are good
faith estimates based on assumptions believed to be reasonable by the Borrower
at the time of delivery of such projections to the Agent and the Lenders and
that no assurances can be given that the results set forth in the projections
will actually be obtained).
5.11. Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of the value of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary
is a party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property except for any failure
to comply with any of the foregoing which could not reasonably be expected to
have a Material Adverse Effect.
5.14. Ownership of Properties. Except as set forth on Schedule 2, on
the date of this Agreement, the Borrower and its Subsidiaries will have good
title, free of all Liens other than those permitted by Section 6.15, to all of
the Property and assets reflected in the Borrower's most recent consolidated
financial statements provided to the Agent as owned by the Borrower and its
Subsidiaries.
5.15. Prohibited Transactions. Neither the execution of this
Agreement nor the making of Credit Extensions hereunder gives rise to a
prohibited transaction within the meaning of Section 406 of ERISA or Section
4975 of the Code.
36
5.16. Environmental Matters. In the ordinary course of its business,
the officers of the Borrower consider and evaluate the effect of Environmental
Laws upon in the operation of Borrower's and each of Borrower's Subsidiary's
businesses and periodically evaluate compliance by Borrower and each Subsidiary
with all applicable Environmental Laws. On the basis of such consideration and
evaluation, Borrower has concluded that Environmental Laws cannot reasonably be
expected to have a Material Adverse Effect. Except as disclosed in the Periodic
Reports and in Schedule 5.16 and except with respect to any other matters that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i)
has failed to comply in all material respects with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received written notice of any claim with respect to any
Environmental Liability, (iv) has received written notice that any of its
operations are not in material compliance with the requirements of applicable
Environmental Laws or are the subject of any Federal or state investigation
evaluating whether any remedial action is needed to respond to a release of any
Hazardous Material or (v) knows of any basis for any material Environmental
Liability.
5.17. Investment Company Act. Neither the Borrower nor any
Subsidiary is an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
5.18. Public Utility Holding Company Act. Neither the Borrower nor
any Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19. Post-Retirement Benefits. The present value of the expected
cost of post-retirement medical and insurance benefits payable by the Borrower
and its Subsidiaries to its employees and former employees, as determined in
accordance with GAAP, does not exceed $15,000,000, except for the amount of any
post-retirement medical and insurance benefit obligations assumed by the
Borrower or one of its Subsidiaries in connection with acquisitions permitted
under this Agreement which, when aggregated with the other post-retirement
medical and insurance benefit obligations to which the Borrower and its
Subsidiaries are subject, could not reasonably be expected to have a Material
Adverse Effect.
5.20. Insurance. The Borrower will insure and keep insured, and will
cause each of its Subsidiaries to insure and keep insured, with good and
responsible insurance companies, all insurable Property owned by it of a
character and to the extent usually insured (subject to self insured retentions
and deductibles) in accordance with reasonable business practices as determined
in good faith by management of the Borrower. To the extent usually insured
(subject to self-insured retentions and deductibles) in accordance with
reasonable business practices as determined in good faith management of the
Borrower, the Borrower will also insure, and cause each of its Subsidiaries to
insure such other hazards and risks (including employers' and public and product
liability risks) with good and responsible insurance companies. The certificate
signed by the Chief Executive Officer or Chief Financial Officer of the
Borrower, that attests to the existence of, and summarizes, the property and
casualty insurance program carried by the Borrower with respect to itself and
its Subsidiaries and that has been furnished by the Borrower to the Agent and
the Lenders, is complete and accurate in all material respects. This summary
includes the insurer's or insurers' name(s), policy number(s), expiration
date(s), amount(s) of coverage, type(s) of coverage, and deductibles. This
summary also includes similar information, and describes any reserves, relating
to any self-insurance program that is in effect.
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ARTICLE
6.
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will, and will cause each of
its Subsidiaries to, maintain books and records including a system of accounting
established and administered in accordance with sound business practices to
permit preparation of financial statements in accordance with GAAP, and will
furnish to the Lenders:
(a) Within 90 days after the close of each of its fiscal
years, (or such lesser number of days within which the Borrower shall be
required to file its Annual Report on Form 10-K for such fiscal year with the
SEC), the audited consolidated balance sheet and related statements of income,
shareholders' equity and cash flows of the Borrower and its Subsidiaries as of
the end of and for such year, setting forth in each case in comparative form the
figures for (or, in the case of the balance sheet, as of the end of) the
previous fiscal year, all reported on by independent public accountants of
recognized national standing (without a "going concern" or like qualification or
exception and without any qualification or exception as to the scope of such
audit) and certified by the Chief Financial Officer to the effect that such
consolidated financial statements present fairly in all material respects the
financial condition and results of operations of the Borrower and its
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied. The financial statements shall be further accompanied by (i) any
management letter prepared by said accountants, and (ii) a certificate of said
accountants that, in the course of their examination necessary for their
certification of the foregoing, they have obtained no knowledge of any Default
or Unmatured Default, or if, in the opinion of such accountants, any Default or
Unmatured Default shall exist, stating the nature and status thereof.
(b) Within 45 days after the close of the first three
quarterly periods of each of its fiscal years (or such lesser number of days
within which the Borrower shall be required to file its Quarterly Report on Form
10-Q for such fiscal quarter with the SEC), the consolidated balance sheet and
related statements of income, shareholders' equity and cash flows of the
Borrower and its consolidated Subsidiaries as of the end of and for such fiscal
quarter and the then elapsed portion of such fiscal year, setting forth in each
case in comparative form the figures for (or, in the case of the balance sheet,
as of the end of such period) the same period of the previous fiscal year, all
certified by the Chief Financial Officer of the Borrower as presenting fairly in
all material respects the financial condition and results of operations of the
Borrower and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and
the absence of footnotes, for itself and its consolidated Subsidiaries,
consolidated and (in the case of identifiable business segments) consolidating
unaudited balance sheets as at the close of each such period and consolidated
and (in the case of identifiable business segments) consolidating profit and
loss and a statement of cash flows for the period from the beginning of such
fiscal year to the end of such quarter, all certified by its chief financial
officer.
(c) As soon as available, but in any event within 90 days
after the beginning of each fiscal year of the Borrower, a copy of the plan and
forecast (including a projected consolidated (and in the case of identifiable
business segments, consolidating) balance sheet, income statement and funds flow
statement) of the Borrower for such fiscal year.
38
(d) Together with the financial statements required under
Sections 6.1(a) and (b), a compliance certificate in substantially the form of
Exhibit B signed by its Chief Financial Officer showing the calculations
necessary to determine compliance with this Agreement and stating that no
Default or Unmatured Default exists, or if any Default or Unmatured Default
exists, stating the nature and status thereof.
(e) As soon as possible and in any event within 10 days
after the Borrower knows that any Reportable Event has occurred with respect to
any Plan, a statement, signed by the chief financial officer of the Borrower,
describing said Reportable Event and the action which the Borrower proposes to
take with respect thereto.
(f) As soon as possible and in any event within 10 days
after receipt by the Borrower, a copy of (i) any written notice or claim to the
effect that the Borrower or any of its Subsidiaries is or may be liable to any
Person as a result of the release by the Borrower, any of its Subsidiaries, or
any other Person of any Hazardous Materials or substance into the environment,
(ii) any written notice alleging any violation of any federal, state or local
Environmental Law by the Borrower or any of its Subsidiaries, and (iii) any
notice that Borrower or any Subsidiary is the subject of an investigation by any
governmental or quasi-governmental authority relating to the use, disposal or
treatment of any Hazardous Material or compliance by Borrower or any Subsidiary
with any applicable Environmental Law.
(g) Promptly upon the furnishing thereof to the
shareholders of the Borrower, copies of all financial statements, reports and
proxy statements so furnished.
(h) Promptly (i) after the filing thereof, copies of all
periodic and other reports, periodic and other certifications of the Chief
Executive Officer and Chief Financial Officer of the Borrower, registration
statements and other publicly available materials filed by the Borrower or any
of its Subsidiaries with the SEC, or any Governmental Authority succeeding to
any or all of the functions of the SEC, or with any national securities exchange
(other than exhibits to any of the foregoing which are too voluminous to furnish
and which are made available by the Borrower or any of its Subsidiaries on such
Person's website and any registration statement on Form S-8 or its equivalent)
and (ii) after the distribution thereof, copies of all financial statements,
reports, proxy statements and other materials distributed by the Borrower to its
shareholders generally.
(i) Such other information (including non-financial
information) as the Agent or any Lender may from time to time reasonably
request.
6.2. Use of Proceeds. The Borrower will, and will cause each
Subsidiary to, use the proceeds of the Credit Extensions for general corporate
purposes and for working capital purposes. The Borrower will not, nor will it
permit any Subsidiary to, use any of the proceeds of the Advances to purchase or
carry any "margin stock" (as defined in Regulation U).
6.3. Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders of the occurrence of
any Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and do all things necessary to remain duly incorporated or organized,
validly
39
existing and (to the extent such concept applies to such entity) in good
standing as a domestic corporation in its jurisdiction of incorporation or
organization, as the case may be, and maintain all requisite authority to
conduct its business in each jurisdiction in which its business is conducted.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to,
timely file complete and correct in all material respects United States federal
and applicable foreign, state and local tax returns required by law and pay when
due all taxes, assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside in accordance with GAAP consistently applied.
6.6. Insurance. The Borrower will, and will cause each Subsidiary
to, maintain with financially sound and reputable insurance companies insurance
on all their Property in such amounts (subject to self-insured retentions and
deductibles) and covering such risks (including employers' and public and
product liability risks) as are consistent with sound business practice, and the
Borrower will furnish to any Lender upon request full information as to the
insurance carried.
6.7. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws; provided, however, that neither the
Borrower nor any Subsidiary shall be required to comply with any such law,
regulation, ordinance or order if (x) it shall be contesting such law,
regulation, ordinance or order in good faith by appropriate proceedings and
reserves in conformity with GAAP have been provided therefore on the books of
the Borrower or such Subsidiary, as the case may be, or (y) the failure to
comply therewith is not reasonably expect to have, in the aggregate, a Material
Adverse Effect.
6.8. Maintenance of Properties. The Borrower will, and will cause
each Subsidiary to, do all things necessary to maintain, preserve, protect and
keep its Property in good repair, working order and condition, and make all
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times;
provided, however, that nothing in this Section 6.8 shall prevent the Borrower
or a Subsidiary from discontinuing the operation or maintenance of any such
Properties if such discontinuance is, in the reasonable judgment of the
Borrower, desirable in the conduct of its business or the business of its
Subsidiary.
6.9. Inspection. The Borrower will, and will cause each Subsidiary
to, permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, books and financial records of the
Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each Subsidiary, and to
discuss the affairs, finances and accounts of the Borrower and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Agent or any Lender may designate. The
Borrower shall not be liable under Section 9.6.1 hereof for the cost of any
action taken solely under the authority of this Section unless such action has
been taken upon the occurrence and during the continuation of any Default.
6.10. Dividends. The Borrower will not, nor will it permit any
Subsidiary to, declare or pay any dividends or make any distributions on its
capital stock (other than dividends payable in its own capital stock) or redeem,
repurchase or otherwise acquire or retire any of its capital stock at any time
outstanding, except that (i) any Subsidiary may declare and pay dividends or
make distributions to the Borrower or to a Wholly-Owned Subsidiary, (ii) the
Borrower may declare and pay dividends on its capital stock provided that no
Default or Unmatured Default shall exist before or after giving effect to
40
such dividends or be created as a result thereof; (iii) the Borrower or any
Subsidiary may declare and pay dividends to a partner in any partnership or
joint venture as permitted under Section 6.14; and (iv) pursuant to a
open-market stock repurchase program approved in advance by its Board of
Directors, repurchase Common Stock in an aggregate amount which could not
reasonably be expected to cause a Material Adverse Effect.
6.11. Secured Indebtedness. The aggregate amount of all Secured
Indebtedness of Borrower and all Subsidiaries shall not equal or exceed at any
time during the term of this Agreement, 25% of Consolidated Net Worth.
6.12. Merger. The Borrower will not, nor will it permit any
Subsidiary to, merge or consolidate with or into any other Person, except:
(a) a merger of a Domestic Subsidiary or a Foreign
Subsidiary with the Borrower or with a Domestic Subsidiary;
(b) a merger of a Domestic Subsidiary (or a transfer of
assets contained therein) with a Foreign Subsidiary; provided, that the total
assets of all Domestic Subsidiaries which are merged with (or transferred to)
Foreign Subsidiaries at any time during the term of this Agreement shall not
exceed 25% of the total assets of the Borrower and its Subsidiaries determined
on a consolidated basis on the date of such merger or transfer; or
(c) A merger of a Domestic Subsidiary or Foreign
Subsidiary formed for the sole purpose of effecting a transaction described in
Section 6.14(f).
6.13. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(a) Sales of inventory in the ordinary course of
business; or
(b) Leases, sales or other dispositions of its Property
that, together with all other Property of the Borrower and its Subsidiaries
previously leased, sold or disposed of (other than inventory in the ordinary
course of business) as permitted by this Section, do not constitute a
Substantial Portion of the Property of the Borrower and its Subsidiaries, other
than dispositions of unwanted assets that were acquired in connection with an
acquisition, provided such disposition (i) is completed on fair and reasonable
terms no less favorable to the Borrower or a Subsidiary than the Borrower or
such Subsidiary would obtain in a comparable arms-length transaction and (ii)
occurs within a reasonable period of time after completion of such acquisition.
6.14. Investments and Acquisitions. The Borrower will not, nor will
it permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to become
or remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:
(a) Cash Equivalent Investments;
(b) Existing Investments in Subsidiaries and other
Investments in existence on the date hereof and described in Schedule 1;
41
(c) ownership of stock, obligations or securities
received in settlement of debts (created in the ordinary course of business)
owing to the Borrower or any Subsidiary;
(d) endorsement of negotiable instruments for collection
in the ordinary course of business;
(e) loans and advances to (i) non-executive employees in
the ordinary course of business for travel, relocation and similar purposes and
(ii) executive employees in the ordinary course of business for travel;
(f) acquisitions of all or any substantial part of the
assets or business of or investments in any other joint venture, corporation,
partnership or limited liability company or division thereof engaged in a line
of business reasonably related or complementary to that of the Borrower and its
Subsidiaries, or of a majority of the Voting Stock of such a Person, or of
equity interests in any joint venture, corporation, limited liability company or
partnership which does not become a Subsidiary as a result of such acquisition
but is engaged (or promptly after such acquisition will be engaged) in a line of
business reasonably related or complimentary to that of the Borrower and its
Subsidiaries, provided that (i) no Default exists or would exist after giving
effect to such acquisition and (ii) the Board of Directors or other governing
body of such joint venture, limited liability company, corporation or
partnership whose Property, or Voting Stock or other interests in which, are
being so acquired has approved the terms of such acquisition;
(g) liabilities in respect of letters of credit securing
Permitted Industrial Revenue Bond Liabilities and Facility LCs; or
(h) investments not otherwise permitted under this
Section 6.14 in an aggregate amount not exceeding $25,000,000 at any time during
the term of this Agreement.
6.15. Liens. The Borrower will not, nor will it permit any
Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:
(a) Liens for taxes, assessments or governmental charges
or levies on its Property if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good faith and
by appropriate proceedings and for which adequate reserves in accordance with
GAAP consistently applied shall have been set aside on its books;
(b) Liens imposed by law, such as carriers',
warehousemen's and mechanics' liens and other similar Liens arising in the
ordinary course of business which secure payment of obligations not more than 60
days past due or which are being contested in good faith by appropriate
proceedings and for which adequate reserves shall have been set aside on its
books;
(c) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation;
(d) Utility easements, building restrictions and such
other encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which do not in
any material way affect the marketability of the same or interfere with the use
thereof in the business of the Borrower or its Subsidiaries;
42
(e) Liens existing on the date hereof and described in
Schedule 2;
(f) Liens arising out of judgments or awards against the
Borrower or any Subsidiary, or in connection with surety or appeal bonds in
connection with bonding such judgments or awards, the time for appeal from which
or petition for rehearing of which shall not have expired or with respect to
which the Borrower or such Subsidiary shall be prosecuting an appeal or
proceeding for review, and with respect to which Borrower shall have obtained a
stay of execution pending such appeal of proceeding for review; provided that
the aggregate amount of liabilities (including interest and penalties, if any)
of the Borrower and its Subsidiaries secured by such Liens shall not exceed
$10,000,000 at any one time;
(g) Liens on Property of a Subsidiary to secure
obligations of such Subsidiary to the Borrower to another Subsidiary so long as
the obligation to secure is not related to any obligation (other than
obligations hereunder) of the Borrower or such other Subsidiary to any Person;
(h) Any extension, renewal or replacement (or successive
extension, renewals or replacements) in whole or in part of any Lien referred to
in the foregoing sections (a) through (g), inclusive, provided that the
principal amount of the Indebtedness secured thereby shall not exceed the
principal amount of Indebtedness so secured at the time of such extension,
renewal or replacement and that such extension renewal or replacement shall be
limited to the Property which was subject to the Lien so extended, renewed or
replaced;
(i) Liens securing Permitted Industrial Revenue Bond
Liabilities, provided that any such Lien shall apply only to the real property
and machinery and equipment comprising the manufacturing facility financed, in
whole or in party, with the proceeds of the applicable Permitted Industrial
Revenue Bond;
(j) Liens on the assets of Persons which become
Subsidiaries after the date of this Agreement; provided that such Liens existed
at the time the respective Person became a Subsidiary and were not created in
anticipation thereof; or
(k) Liens securing Secured Indebtedness.
6.16. Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arms-length transaction.
6.17. Letters of Credit. The Borrower will not, nor will it permit
any Subsidiary to, apply for or become liable upon or in respect of any Letter
of Credit other than Facility LCs and Permitted Indebtedness Revenue Bond
Liabilities.
6.18. Financial Covenants.
6.18.1. Interest Coverage Ratio. The Borrower will not permit
the ratio of (i) Consolidated EBIT to (ii) Consolidated Net Interest Expense to
be less than (A) 3.0 to 1.0 determined as of the end of each of its fiscal
quarters ended prior to the first three anniversary dates of this Agreement and
(B) 3.75 to 1.0 determined as of the end of each of its fiscal quarters ended
prior to the fourth and fifth anniversary dates of this Agreement.
43
6.18.2. Leverage Ratio. The Borrower will not permit the
ratio of (i) Consolidated Funded Indebtedness to (ii) Consolidated EBITDA for
the then most-recently ended four fiscal quarters to be greater than 2.5 to 1.0
determined as the end of each of its fiscal quarters during the term of this
Agreement.
6.18.3. Minimum Net Worth. The Borrower will at all times
maintain Consolidated Net Worth of not less than (A) $240,000,000 determined as
of the end of each of its fiscal quarters ended prior to the first three
anniversary dates of this Agreement and (B) $285,000,000 determined as the end
of each of its fiscal quarters ended prior to the fourth and fifth anniversary
dates of this Agreement.
6.18.4. Adjustments to Financial Ratios. In computing ratios
and amounts for purposes of this Section 6.18, any asset impairment adjustment
required by Statement of Financial Accounting Standards #141 or #142 (SFAS #141
or SFAS #142) or any adjustment to pension assets required by Statement of
Financial Accounting Standards #87 (or interpretations or modifications
thereof) resulting in a charge to earnings or a write-down of Shareholders'
Equity will be added back, in an amount not to exceed $124,000,000 for purposes
of determining whether the Borrower has breached such financial covenants.
6.19. Existence; Subsidiary Guarantees. The Borrower shall, and
shall cause each of its Subsidiaries to, preserve and maintain its corporate
existence; provided that nothing in this Section shall prevent mergers and
consolidations permitted by Section 6.12 hereof or the discontinuation of the
corporate existence of any Subsidiary if discontinuance of such Subsidiary is
desirable in the conduct of the Borrower's business; provided that the aggregate
total revenues of all Subsidiaries whose corporate existence is discontinued
during any fiscal year may not exceed $25,000,000. As a condition to
establishing or acquiring any Subsidiary and within 15 days after a corporation,
joint venture, partnership or limited liability company otherwise becomes a
Subsidiary, unless the Required Lenders otherwise agree, the Borrower shall (i)
notify Agent of the creation, acquisition or establishment of each Subsidiary;
(ii) cause such Domestic Subsidiary to execute a Subsidiary Guarantee Agreement
unless such Domestic Subsidiary shall not be required to become a Guarantor
pursuant to the last sentence in Section 5.8; (iii) cause such Domestic
Subsidiary, if so required, to deliver documentation similar to that described
in Sections 4.1(a) through (d) relating to the authorization for, execution and
delivery of, and validity of such Subsidiary's obligations as a Guarantor under
the Subsidiary Guaranty Agreement, in form and substance reasonably satisfactory
to Agent; and (iv) if necessary, deliver an updated Schedule 1 to reflect the
new Subsidiary.
6.20. Change in Fiscal Year. Borrower will not change its fiscal
year from its present basis without the prior written consent of Agent.
ARTICLE
7.
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1. Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries to the Lenders or the Agent
under or in connection with this Agreement, any Credit Extension, or any
certificate or information delivered in connection with this Agreement or any
other Loan Document shall be materially false on the date as of which made.
44
7.2. Nonpayment of principal of any Loan when due, nonpayment of
any Reimbursement Obligation within one Business Day after the same becomes due,
or nonpayment of interest upon any Loan or of any commitment fee, LC Fee or
other obligations under any of the Loan Documents within five days after the
same becomes due.
7.3. The breach by the Borrower of any of the terms or provisions
of Sections 6.2, 6.3, 6.4, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.17,
6.18.1, 6.18.2, 6.18.3, 6.19, or 6.20.
7.4. The breach by the Borrower (other than a breach which
constitutes a Default under another Section of this Article 7) of any of the
terms or provisions of this Agreement which is not remedied within thirty days
after written notice from the Agent unless such default, in the reasonable
discretion of the Lender, adversely and imminently affects the ability of the
Lenders to collect the Obligations, in which case, such Default shall be cured
within five days after written notice from the Agent.
7.5. Failure of the Borrower or any of its Subsidiaries to pay when
due any Material Indebtedness; or the default by the Borrower or any of its
Subsidiaries in the performance of any term, provision or condition contained in
any Material Indebtedness Agreement, or any other event shall occur or condition
exist, the effect of which default, event or condition is to cause, or to permit
the holder(s) of such Material Indebtedness or the lender(s) under any Material
Indebtedness Agreement to cause, such Material Indebtedness to become due prior
to its stated maturity or any commitment to lend under any Material Indebtedness
Agreement to be terminated prior to its stated expiration date; or any Material
Indebtedness of the Borrower or any of its Subsidiaries shall be declared to be
due and payable or required to be prepaid or repurchased (other than by a
regularly scheduled payment) prior to the stated maturity thereof; or the
Borrower or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6. There shall occur under any Rate Management Transaction, an
early termination date (as provided for in any agreement with respect to such
Rate Management Transaction) resulting from (a) any default under such agreement
as to which the Borrower or any Subsidiary is the defaulting party (as
determined in accordance with such agreement); or (b) any termination event (as
determined in accordance with such agreement) as to which the Borrower or any
Subsidiary is an affected party (as defined in said agreement), and in either
event, the Rate Management Obligations of the Borrower or such Subsidiary as a
result thereof is $5,000,000 or more.
7.7. The Borrower or any of its Subsidiaries shall (a) have an
order for relief entered with respect to it under the Federal bankruptcy laws as
now or hereafter in effect, (b) make an assignment for the benefit of creditors,
(c) apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (d) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (e)
take any corporate action to authorize or effect any of the foregoing actions
set forth in this Section 7.7 or (f) fail to contest in good faith any
appointment or proceeding described in Section 7.8.
7.8. Without the application, approval or consent of the Borrower
or any of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its
45
Subsidiaries or any Substantial Portion of its Property, or a proceeding
described in Section 7.7(d) shall be instituted against the Borrower or any of
its Subsidiaries and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of 30 consecutive days.
7.9. Any court, government or governmental agency shall condemn,
seize or otherwise appropriate, or take custody or control of, all or any
portion of the Property of the Borrower and its Subsidiaries which, when taken
together with all other Property of the Borrower and its Subsidiaries so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such action occurs,
constitutes a Substantial Portion.
7.10. The Borrower or any of its Subsidiaries shall fail within 30
days to pay, bond or otherwise discharge one or more (i) judgments or orders for
the payment of money in excess of $10,000,000 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.11. (i) Any Reportable Event shall occur in connection with any
Plan; (ii) the Borrower or any Subsidiary shall file a notice of intent under
Title IV of ERISA to terminate a Plan or Plans having aggregate Unfunded
Liabilities of all Single Employer Plans attributable to the Borrower or any
Subsidiary in excess of $5,000,000 (collectively, a "Material Plan"); (iii) any
plan administrator or the PBGC shall institute proceedings under Title IV of
ERISA to terminate or to cause a trustee to be appointed to administer any
Material Plan; (iv) a proceeding shall be instituted by a fiduciary of any
Material Plan against the Borrower or any Subsidiary to enforce Section 515 or
4219(c)(5) of ERISA and such proceeding shall not have been dismissed within 30
days thereafter; or (v) a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Material Plan must be
terminated.
7.12. Any Change in Control shall occur.
7.13. The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Borrower or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification) which could reasonably be
expected to have a Material Adverse Effect.
7.14. The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, if as a result of such reorganization or
termination the aggregate annual contributions of the Borrower and the other
members of the Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years of each such Multiemployer Plan immediately preceding the
plan year in which the reorganization or termination occurs by an amount which
could reasonably be expected to have a Material Adverse Effect.
7.15. The occurrence of any "default", as defined in any Loan
Document (other than this Agreement) or the breach of any of the terms or
provisions of any Loan Document (other than this Agreement), which default or
breach continues beyond any period of grace therein provided.
46
7.16. Any Guaranty is not in full force and effect with respect to
all parties thereto, or any action shall be taken to discontinue or to assert
the invalidity or unenforceability of any Guaranty or any Guarantor shall deny
that it has any further liability under any Guaranty to which it is a party or
shall give notice to such effect.
ARTICLE
8.
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration; Termination of Extensions of Facility LCs.
8.1.1. If any Default in Section 7.7 or 7.8 occurs with
respect to the Borrower, the obligations of the Lenders to make Loans hereunder
and the obligation and power of the LC Issuer to issue Facility LCs shall
automatically terminate and the Obligations shall immediately become due and
payable without any election or action on the part of the Agent, the LC Issuer
or any Lender and the Borrower will be and become thereby unconditionally
obligated, without any further notice, act or demand, to pay to the Agent an
amount equal to the LC Obligations in immediately available funds, which funds
shall be held in a special collateral account pursuant to arrangements
satisfactory to the Agent (the "Facility LC Collateral Account") at the Agent's
office at the address specified pursuant to Article 13, in the name of such
Borrower but under the sole dominion and control of the Agent, for the benefit
of the Lenders and in which such Borrower shall have no interest other than as
set forth in this Section 8.1. The Borrower hereby pledges, assigns and grants
to the Agent, on behalf of and for the ratable benefit of the Lenders and the LC
Issuer, a security interest in all of the Borrower's right, title and interest
in and to all funds which may from time to time be on deposit in the Facility LC
Collateral Account to secure the prompt and complete payment and performance of
the Obligations. The Agent will invest any funds on deposit from time to time in
the Facility LC Collateral Account in certificates of deposit of Bank One having
a maturity not exceeding 30 days.
8.1.2. If any other Default occurs, the Required Lenders (or
the Agent with the consent of the Required Lenders) may (a) terminate or suspend
the obligations of the Lenders to make Loans hereunder and the obligation and
power of the LC Issuer to issue Facility LCs, or declare the Obligations to be
due and payable, or both, whereupon the Obligations shall become immediately due
and payable, without presentment, demand, protest or notice of any kind, all of
which the Borrower hereby expressly waives and (b) upon notice to the Borrower
and in addition to the continuing right to demand payment of all amounts payable
under this Agreement, make demand on the Borrower to pay, and the Borrower will,
forthwith upon such demand and without any further notice or act, pay to the
Agent an amount equal to the LC Obligations, which funds shall be deposited in
the Facility LC Collateral Account.
8.1.3. The Agent may at any time or from time to time after
funds are deposited in the Facility LC Collateral Account, apply such funds to
the payment of the Obligations and any other amounts as shall from time to time
have become due and payable by the Borrower to the Lenders or the LC Issuer
under the Loan Documents.
8.1.4. At any time while any Default is continuing, neither
the Borrower nor any Person claiming on behalf of or through the Borrower shall
have any right to withdraw any of the funds held in the Facility LC Collateral
Account. After all of the Obligations have been indefeasibly paid in full and
the Aggregate Commitment has been terminated, any funds remaining in the
Facility LC Collateral Account shall be returned by the Agent to the Borrower or
paid to whomever may be legally entitled thereto at such time.
47
8.2. Amendments. Subject to the provisions of this Section 8.2, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
(a) Extend the final maturity of any Loan, or extend the
expiry date of any Facility LC to a date after the Facility Termination Date or
postpone any regularly scheduled payment of principal of any Loan or forgive all
or any portion of the principal amount thereof or any Reimbursement Obligation
related thereto, or reduce the rate or extend the time of payment of interest or
fees thereon or Reimbursement Obligations related thereto;
(b) Reduce the percentage specified in the definition of
Required Lenders;
(c) Extend the Facility Termination Date or reduce the
amount or extend the payment date for, the mandatory payments required under
Section 2.2, or increase the amount of the Aggregate Commitment, the Commitment
of any Lender hereunder or the commitment to issue Facility LCs, or permit the
Borrower to assign its rights under this Agreement; or
(d) Amend this Section 8.2.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision relating to the LC Issuer, the Swing Line Lender or any Swing Line
Loans shall be effective without the written consent of the LC Issuer or the
Swing Line Lender, as the case may be. The Agent may waive payment of the fee
required under Section 12.3.3 without obtaining the consent of any other party
to this Agreement.
8.3. Preservation of Rights. No delay or omission of the Lenders,
the LC Issuer or the Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Credit Extension notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the
conditions precedent to such Credit Extension shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Lenders required pursuant to Section 8.2, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Loan Documents or by law afforded shall be cumulative and all shall be available
to the Agent, the LC Issuer and the Lenders until the Obligations have been paid
in full.
ARTICLE
9.
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and
warranties of the Borrower contained in this Agreement shall survive the making
of the Credit Extensions herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement
to the contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
48
9.3. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
9.4. Entire Agreement. The Loan Documents embody the entire
agreement and understanding among the Borrower, the Agent, the LC Issuer and the
Lenders and supersede all prior agreements and understandings among the
Borrower, the Agent, the LC Issuer and the Lenders relating to the subject
matter thereof other than those contained in the fee letter described in Section
10.13 which shall survive and remain in full force and effect during the term of
this Agreement.
9.5. Several Obligations; Benefits of this Agreement. The
respective obligations of the Lenders hereunder are several and not joint and no
Lender shall be the partner or agent of any other (except to the extent to which
the Agent is authorized to act as such). The failure of any Lender to perform
any of its obligations hereunder shall not relieve any other Lender from any of
its obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6. Expenses; Indemnification.
9.6.1. Expenses. The Borrower shall reimburse the Agent and
the Arranger for all reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, which attorneys may be employees of the Agent) paid or incurred by
the Agent or the Arranger in connection with the preparation, negotiation,
execution, delivery, syndication, distribution (including, without limitation,
via the internet), review, amendment, modification, and administration of the
Loan Documents. The Borrower also agrees to reimburse the Agent, the Arranger,
the LC Issuer and the Lenders for any costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, the Arranger, the LC Issuer and the Lenders, which attorneys may be
employees of the Agent, the Arranger, the LC Issuer or the Lenders) paid or
incurred by the Agent, the Arranger, the LC Issuer or any Lender in connection
with the collection and enforcement of the Loan Documents. Expenses being
reimbursed by the Borrower under this Section include, without limitation, costs
and expenses incurred in connection with the Reports described in the following
sentence. The Borrower acknowledges that from time to time Bank One may prepare
and may distribute to the Lenders (but shall have no obligation or duty to
prepare or to distribute to the Lenders) certain audit reports (the "Reports")
pertaining to the Borrower's assets for internal use by Bank One from
information furnished to it by or on behalf of the Borrower, after Bank One has
exercised its rights of inspection pursuant to this Agreement. Upon written
request, the Agent shall furnish to the Borrower copies of invoices and billing
records relating to all costs and expenses being reimbursed.
9.6.2. Indemnification. The Borrower hereby further agrees
to indemnify the Agent, the Arranger, the LC Issuer and each Lender, their
respective Affiliates, and each of their directors, officers and employees
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all expenses of litigation or
preparation therefor whether or not the Agent, the Arranger, the LC Issuer or
any Lender or any Affiliate is a party thereto) which any of them may pay or
incur arising out of or relating to this Agreement, the other Loan Documents,
the transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any
49
Credit Extension hereunder except to the extent that they are determined in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the party seeking
indemnification; provided, that the Borrower shall not have any obligation to
indemnify the Agent, the Arranger, the LC Issuer or any Lender hereunder with
respect to any liabilities arising out of legal proceedings commenced against a
Lender by another Lender or its assignee to the extent such proceedings relate
solely to disputes arising from matters not relating to Borrower or any
Subsidiary. The obligations of the Borrower under this Section 9.6 shall survive
the termination of this Agreement.
9.7. Numbers of Documents. All statements, notices, closing
documents, and requests hereunder shall be furnished to the Agent with
sufficient counterparts so that the Agent may furnish one to each of the
Lenders.
9.8. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP consistently
applied, except that any calculation or determination which is to be made on a
consolidated basis shall be made for the Borrower and all its Subsidiaries.
9.9. Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.10. Nonliability of Lenders. The relationship between the Borrower
on the one hand and the Lenders, the LC Issuer and the Agent on the other hand
shall be solely that of borrower and lender. Neither the Agent, the Arranger,
the LC Issuer nor any Lender shall have any fiduciary responsibilities to the
Borrower. Neither the Agent, the Arranger, the LC Issuer nor any Lender
undertakes any responsibility to the Borrower to review or inform the Borrower
of any matter in connection with any phase of the Borrower's business or
operations. The Borrower agrees that neither the Agent, the Arranger, the LC
Issuer nor any Lender shall have liability to the Borrower (whether sounding in
tort, contract or otherwise) for losses suffered by the Borrower in connection
with, arising out of, or in any way related to, the transactions contemplated
and the relationship established by the Loan Documents, or any act, omission or
event occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Borrower, the Agent, the Arranger, the LC Issuer
nor any Lender shall have any liability with respect to, and each of the
Borrower, the Agent, the Arranger, the LC Issuer and any Lender hereby waives,
releases and agrees not to sue for, any special, indirect, consequential or
punitive damages suffered by any other Party in connection with, arising out of,
or in any way related to the Loan Documents or the transactions contemplated
thereby.
9.11. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (a) to its Affiliates and to other Lenders and
their respective Affiliates, (b) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (c) to regulatory
officials, (d) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (e) to any Person in connection with any legal
proceeding to which such Lender is a party, (f) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional
50
advisors to such counterparties, (g) permitted by Section 12.4 and (h) to rating
agencies if requested or required by such agencies in connection with a rating
relating to the Advances hereunder.
9.12. Nonreliance. Each Lender hereby represents that it is not
relying on or looking to any margin stock (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) for the repayment of the
Credit Exposure provided for herein.
9.13. Disclosure. The Borrower and each Lender hereby acknowledge
and agree that Bank One and/or its Affiliates from time to time may hold
investments in, make other loans to or have other relationships with the
Borrower and its Affiliates.
ARTICLE
10.
THE AGENT
10.1. Appointment; Nature of Relationship. Bank One, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
10. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of the term "secured party" as defined in the Illinois Uniform
Commercial Code and (iii) is acting as an independent contractor, the rights and
duties of which are limited to those expressly set forth in this Agreement and
the other Loan Documents. Each of the Lenders hereby agrees to assert no claim
against the Agent on any agency theory or any other theory of liability for
breach of fiduciary duty, all of which claims each Lender hereby waives.
10.2. Powers. The Agent shall have and may exercise such powers
under the Loan Documents as are specifically delegated to the Agent by the terms
of each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into, or verify (a) any statement,
warranty or representation made in connection with any Loan Document or any
borrowing hereunder; (b) the performance or observance of any of the covenants
or agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish
51
information directly to each Lender; (c) the satisfaction of any condition
specified in Article 4, except receipt of items required to be delivered solely
to the Agent; (d) the existence or possible existence of any Default or
Unmatured Default; (e) the validity, enforceability, effectiveness, sufficiency
or genuineness of any Loan Document or any other instrument or writing furnished
in connection therewith; (f) the value, sufficiency, creation, perfection or
priority of any Lien in any collateral security; or (g) the financial condition
of the Borrower or any guarantor of any of the Obligations or of any of the
Borrower's or any such guarantor's respective Subsidiaries. The Agent shall have
no duty to disclose to the Lenders information that is not required to be
furnished by the Borrower to the Agent at such time, but is voluntarily
furnished by the Borrower to the Agent (either in its capacity as Agent or in
its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Loan Document in accordance with written instructions signed by
the Required Lenders, and such instructions and any action taken or failure to
act pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any of
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree
to reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (a) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (b) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (c) for any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever which may be imposed on, incurred by or asserted
against the Agent in any way relating to or arising out of the Loan Documents or
any other document delivered in connection therewith or the transactions
contemplated thereby (including, without limitation, for any such amounts
incurred by or asserted against the Agent in connection with any dispute between
the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms
52
of the Loan Documents or of any such other documents, provided that (y) no
Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Agent and (z) any indemnification required pursuant to Section 10.7 shall,
notwithstanding the provisions of this Section 10.8, be paid by the relevant
Lender in accordance with the provisions thereof. The obligations of the Lenders
under this Section 10.8 shall survive payment of the Obligations and termination
of this Agreement.
10.9. Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement describing such Default or Unmatured
Default and stating that such notice is a "notice of default". In the event that
the Agent receives such a notice, the Agent shall give prompt notice thereof to
the Lenders.
10.10. Rights as a Lender. In the event the Agent is a Lender, the
Agent shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
10.12. Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If no successor Agent
shall have been so appointed by the Required Lenders within thirty days after
the resigning Agent's giving notice of its intention to resign, then the
resigning Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Agent. Notwithstanding the previous sentence, the Agent may at any
time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as
53
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning or removed Agent. Upon the effectiveness of the resignation or
removal of the Agent, the resigning or removed Agent shall be discharged from
its duties and obligations hereunder and under the Loan Documents. After the
effectiveness of the resignation or removal of an Agent, the provisions of this
Article 10 shall continue in effect for the benefit of such Agent in respect of
any actions taken or omitted to be taken by it while it was acting as the Agent
hereunder and under the other Loan Documents. In the event that there is a
successor to the Agent by merger, or the Agent assigns its duties and
obligations to an Affiliate pursuant to this Section 10.12, then the term "Prime
Rate" as used in this Agreement shall mean the prime rate, base rate or other
analogous rate of the new Agent.
10.13. Agent and Arranger Fees. The Borrower agrees to pay to the
Agent and the Arranger, for their respective accounts, the fees agreed to by the
Borrower, the Agent and the Arranger pursuant to that certain letter agreement
dated January 16, 2003 or as otherwise agreed from time to time.
10.14. Delegation to Affiliates. The Borrower and the Lenders agree
that the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles 9 and 10.
ARTICLE
11.
SETOFF; RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation of, any rights
of the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Obligations owing to such
Lender, whether or not the Obligations, or any part thereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or
otherwise, has payment made to it upon its Outstanding Credit Exposure (other
than payments received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater
proportion than that received by any other Lender, such Lender agrees, promptly
upon demand, to purchase a portion of the Aggregate Outstanding Credit Exposure
held by the other Lenders so that after such purchase each Lender will hold its
Pro Rata Share of the Aggregate Outstanding Credit Exposure. If any Lender,
whether in connection with setoff or amounts which might be subject to setoff or
otherwise, receives collateral or other protection for its Obligations or such
amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their respective Pro Rata
Shares of the Aggregate Outstanding Credit Exposure. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
54
ARTICLE
12.
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns permitted hereby, except
that (a) the Borrower shall not have the right to assign its rights or
obligations under the Loan Documents without the prior written consent of each
Lender, (b) any assignment by any Lender must be made in compliance with Section
12.3, and (c) any transfer by participation must be made in compliance with
Section 12.2. Any attempted assignment or transfer by any party not made in
compliance with this Section 12.1 shall be null and void, unless such attempted
assignment or transfer is treated as a participation in accordance with Section
12.2.1. The parties to this Agreement acknowledge that clause (b) of this
Section 12.1 relates only to absolute assignments and this Section 12.1 does not
prohibit assignments creating security interests, including, without limitation,
(x) any pledge or assignment by any Lender of all or any portion of its rights
under this Agreement and any Note to a Federal Reserve Bank or (y) in the case
of a Lender which is a Fund, any pledge or assignment of all or any portion of
its rights under this Agreement and any Note to its trustee in support of its
obligations to its trustee; provided, however, that no such pledge or assignment
creating a security interest shall release the transferor Lender from its
obligations hereunder unless and until the parties thereto have complied with
the provisions of Section 12.3. The Agent may treat the Person which made any
Loan or which holds any Note as the owner thereof for all purposes hereof unless
and until such Person complies with Section 12.3; provided, however, that the
Agent may in its discretion (but shall not be required to) follow instructions
from the Person which made any Loan or which holds any Note to direct payments
relating to such Loan or Note to another Person. Any assignee of the rights to
any Loan or any Note agrees by acceptance of such assignment to be bound by all
the terms and provisions of the Loan Documents. Any request, authority or
consent of any Person, who at the time of making such request or giving such
authority or consent is the owner of the rights to any Loan (whether or not a
Note has been issued in evidence thereof), shall be conclusive and binding on
any subsequent holder or assignee of the rights to such Loan.
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender may at any
time sell to one or more banks or other entities ("Participants") with the
consent of the Borrower (which shall not be unreasonably withheld) unless a
Default shall occur and is continuing, in which case, the Borrower's consent
shall not be required participating interests in any Outstanding Credit Exposure
of such Lender, any Note held by such Lender, any Commitment of such Lender or
any other interest of such Lender under the Loan Documents. In the event of any
such sale by a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, such Lender shall remain the owner of its Outstanding Credit
Exposure and the holder of any Note issued to it in evidence thereof for all
purposes under the Loan Documents, all amounts payable by the Borrower under
this Agreement shall be determined as if such Lender had not sold such
participating interests, and the Borrower and the Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole
right to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than any
amendment, modification or waiver with respect to any Credit Extension or
55
Commitment in which such Participant has an interest which would require consent
of all of the Lenders pursuant to the terms of Section 8.2 or of any other Loan
Document.
12.2.3. Benefit of Certain Provisions. The Borrower agrees
that each Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing under the
Loan Documents to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan Documents, provided that
each Lender shall retain the right of setoff provided in Section 11.1 with
respect to the amount of participating interests sold to each Participant. The
Lenders agree to share with each Participant, and each Participant, by
exercising the right of setoff provided in Section 11.1, agrees to share with
each Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if each
Participant were a Lender. The Borrower further agrees that each Participant
shall be entitled to the benefits of Sections 3.1, 3.2, 3.4 and 3.5 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to Section 12.3, provided that (i) a Participant shall not be entitled
to receive any greater payment under Section 3.1, 3.2 or 3.5 than the Lender who
sold the participating interest to such Participant would have received had it
retained such interest for its own account, and (ii) any Participant not
incorporated under the laws of the United States of America or any State thereof
agrees to comply with the provisions of Section 3.5 to the same extent as if it
were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may at any time
assign to one or more banks or other entities ("Purchasers") all or any part of
its rights and obligations under the Loan Documents. Such assignment shall be
substantially in the form of Exhibit C or in such other form as may be agreed to
by the parties thereto. Each such assignment with respect to a Purchaser which
is not a Lender or an Affiliate of a Lender or an Approved Fund shall either be
in an amount equal to the entire applicable Commitment and Loans of the
assigning Lender or (unless each of the Borrower and the Agent otherwise
consents) be in an aggregate amount not less than $5,000,000. The amount of the
assignment shall be based on the Commitment or outstanding Loans (if the
Commitment has been terminated) subject to the assignment, determined as of the
date of such assignment or as of the "Trade Date," if the "Trade Date" is
specified in the assignment.
12.3.2. Consents. The consent of the Borrower, the Agent and
the LC Issuer shall be required prior to an assignment becoming effective unless
the Purchaser is a Lender, an Affiliate of a Lender or an Approved Fund,
provided that the consent of the Borrower shall not be required if a Default has
occurred and is continuing. Any consent required under this Section 12.3.2 shall
not be unreasonably withheld or delayed.
12.3.3. Effect; Effective Date. Upon (a) delivery to the
Agent of an assignment, together with any consents required by Sections 12.3.1
and 12.3.2, and (ii) payment of a $3,500 fee to the Agent for processing such
assignment (unless such fee is waived by the Agent), such assignment shall
become effective on the effective date specified in such assignment. The
assignment shall contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the Commitment and
Outstanding Credit Exposure under the applicable assignment agreement
constitutes "plan assets" as defined under ERISA and that the rights and
interests of the Purchaser in and under the Loan Documents will not be "plan
assets" under ERISA. On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by or on behalf of the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the same
extent as if it were an original party thereto, and the transferor Lender shall
be released with respect to the Commitment and Outstanding Credit Exposure
56
assigned to such Purchaser without any further consent or action by the
Borrower, the Lenders or the Agent. In the case of an assignment covering all of
the assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a Lender hereunder but shall continue to be entitled to the
benefits of, and subject to, those provisions of this Agreement and the other
Loan Documents which survive payment of the Obligations and termination of the
applicable agreement. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 12.3
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section 12.2.
Upon the consummation of any assignment to a Purchaser pursuant to this Section
12.3.3, the transferor Lender, the Agent and the Borrower shall, if the
transferor Lender or the Purchaser desires that its Loans be evidenced by Notes,
make appropriate arrangements so that new Notes or, as appropriate, replacement
Notes are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser, in each case in principal
amounts reflecting their respective Commitments, as adjusted pursuant to such
assignment.
12.3.4. Register. The Agent, acting solely for this purpose
as an agent of the Borrower, shall maintain at one of its offices in Chicago,
Illinois a copy of each Assignment and Assumption delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive absent manifest error, and the Borrower, the
Agent and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
12.4. Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person acquiring
an interest in the Loan Documents by operation of law (each a "Transferee") and
any prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is not incorporated under the laws of the
United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.5.4.
ARTICLE
13.
NOTICES
13.1. Notices. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (a)
in the case of the Borrower or the Agent, at its address or facsimile number set
forth on the signature pages hereof, (b) in the case of any Lender, at its
address or facsimile number set forth below its signature hereto or (c) in the
case of any party, at such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agent and the Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (x) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and
57
confirmation of receipt is received, (y) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (z) if given by any other means, when delivered (or,
in the case of electronic transmission, received) at the address specified in
this Section; provided that notices to the Agent under Article 2 shall not be
effective until received.
13.2. Change of Address. The Borrower, the Agent and any Lender may
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
ARTICLE
14.
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent, the LC Issuer and the Lenders and each party has notified the Agent by
facsimile transmission or telephone that it has taken such action.
ARTICLE
15.
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
15.1. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING
A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, 735 ILCS SECTION 105/5-1
ET SEQ, BUT OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL
BANKS.
15.2. CONSENT TO JURISDICTION. THE BORROWER, THE AGENT, THE LC
ISSUER AND EACH LENDER HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN
CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY
LOAN DOCUMENTS AND THE BORROWER, THE AGENT, THE LC ISSUER AND EACH LENDER HEREBY
IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVE ANY OBJECTION THEY
MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. ANY
JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT, THE LC ISSUER OR ANY
LENDER OR ANY AFFILIATE OF THE AGENT, THE LC ISSUER OR ANY LENDER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS.
15.3. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, THE LC ISSUER
AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
58
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
SIGNATURE PAGES FOLLOW
59
IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuer and the
Agent have executed this Agreement as of the date first above written.
CLARCOR INC.
By: /s/ BRUCE A. KLEIN
-------------------------------------
Bruce A. Klein
Vice President - Finance and Chief
Financial Officer
2323 Sixth Street
Rockford, IL 61125
Attention: Bruce A. Klein
Telephone: (815) 961-5717
FAX: (815) 962-0973
Commitment Percentage BANK ONE, NA, (Administrative Agent)
- ---------- ---------- Individually, as Agent, Swing Line Lender
$45,000,000 27.2727272% and LC Issuer
By: /s/ ROBERT LOUVAR
-------------------------------------------
Title: Vice President
----------------------------------------
6000 East State Street
Rockford, IL 61108
Attention: Robert Louvar, Vice President
Telephone: (815) 394 4667
FAX: (815) 394-1889
Signature Pages of Other Lenders Follows
60
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ---------- U.S. Bank, National Association
$30,000,000 18.1818181%
By: /s/ MATTHEW SCHULTZ
-------------------------------------------
Title: Vice President
----------------------------------------
777 E. Wisconsin Avenue
Suite/Floor: MK-WI-TGCB
Milwaukee, Wisconsin 53202
Attention: Matthew Schultz,
Vice President
Telephone: (414) 765-5724
FAX: (414) 765-4632
61
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ----------
$30,000,000 18.1818181% BANK OF AMERICA, N.A.
By: /s/ CHRIS BUCKNER
-------------------------------------------
Title: Vice President
----------------------------------------
231 S. LaSalle Street
Suite/Floor: Il1-231-06-40
Chicago, Illinois 60697
Attention: Chris Buckner, Vice President
Telephone: (312) 828-2732
FAX: (312) 828-1974
62
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ----------
$15,000,000 9.0909090% THE NORTHERN TRUST COMPANY
By: /s/ ROBIN COHEN
-------------------------------------------
Title: Vice President
----------------------------------------
50 S. LaSalle Street
Suite/Floor: B-2
Chicago, Illinois 60675
Attention: Robin Cohen, Vice President
Telephone: (312) 444-3438
FAX: (312) 444-7028
63
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ----------
$15,000,000 9.0909090% AMCORE BANK, N.A.
By: /s/ JON E. SCHMIDT
-------------------------------------------
Title: Senior Vice President
----------------------------------------
501 Seventh Street
Post Office Box 1537
Rockford, Illinois 61110-0037
Attention: Jon E. Schmidt,
Senior Vice President
Telephone: (815) 961-2777
FAX: (815) 961-7733
64
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ----------
$15,000,000 9.0909090% NATIONAL CITY BANK
By: /s/ TIFFANY COZZOLINO
-------------------------------------------
Title: Assistant Vice President
----------------------------------------
2021 Spring Road
Suite: 600
Oak Brook, Illinois 60523
Attention: Tiffany Cozzolino,
Assistant Vice President
Telephone: (630) 954-5782
FAX: (630) 954-3730
65
Signature Page to Credit Agreement
Commitment Percentage
- ---------- ----------
$15,000,000 9.0909090% FIFTH THIRD BANK (CHICAGO), a Michigan
Banking Corporation
By: /s/ JOHN KEMPER
-------------------------------------------
Title: Vice President
----------------------------------------
1701 Golf Road
7th Floor, Mail Drop: GRLM7B
Rolling Meadows, Illinois 60008
Attention: John Kemper, Vice President
Telephone: (847) 354-7165
FAX: (847) 354-7130
66
PRICING SCHEDULE
APPLICABLE MARGIN/ LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V
APPLICABLE FEE RATE STATUS STATUS STATUS STATUS STATUS
- ------------------- ------- -------- --------- -------- -------
Eurocurrency Rate 0.50% 0.625% 0.75% 1.00% 1.25%
Alternate Base Rate (0.25)% (0.25)% (0.25)% (0.25)% (0.25)%
Facility L/C Fee 0.50% 0.625% 0.75% 1.00% 1.25%
Commitment Fee 0.10% 0.125% 0.15% 0.20% 0.25%
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Borrower delivered pursuant to Section 6.1 of this Agreement.
"Level I Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, the
Leverage Ratio determined in accordance with Section 6.18.2 of this Agreement is
less than or equal to 1.00 to 1.00.
"Level II Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status and (ii) the Leverage Ratio
determined in accordance with Section 6.18.2 of this Agreement is less than or
equal to 1.50 to 1.00.
"Level III Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status or Level II Status and (ii)
the Leverage Ratio determined in accordance with Section 6.18.2 of this
Agreement is less than or equal to 2.00 or 1.00.
"Level IV Status" exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status, Level II or Level III Status
and (ii) the Leverage Ratio determined in accordance with Section 6.18.2 of this
Agreement is less than or equal to 2.50 to 1.00.
"Level V Status" exists at any date if the Borrower has not qualified
for Level I Status, Level II Status, Level III or Level IV Status.
"Status" means either Level I Status, Level II Status, Level III Status
or Level IV Status.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Borrower's Status as reflected
in the then most recent Financials. Adjustments, if any, to the Applicable
Margin or Applicable Fee Rate shall be effective five Business Days after the
Agent has received the applicable Financials. If the Borrower fails to deliver
the Financials to the Agent at the time required pursuant to this Agreement,
then the Applicable Margin and Applicable Fee Rate shall be the highest
Applicable Margin and Applicable Fee Rate set forth in the foregoing table until
five days after such Financials are so delivered.
67
EXHIBIT A
FORM OF OPINION
April 8, 2003
To the Agent, LC Issuer and Lenders which are parties to the
Credit Agreement referred to below
c/o Bank One NA
as Agent
6000 East State Street
Rockford, Illinois 61108
Ladies and Gentlemen:
I am General Counsel of CLARCOR Inc., a Delaware corporation (the "Company"),
and have acted as counsel to the Company in connection with the Credit Agreement
dated as of April 8, 2003 (the "Agreement") among the Company, as Borrower, the
banks' party to the Agreement (the "Lenders") and Bank One NA, as LC Issuer and
Agent for the Lenders. I have also acted as counsel for CLARCOR Consumer
Products, Inc., a Delaware corporation ("Consumer"), CLARCOR Filtration
Products, Inc., a Delaware corporation ("Filtration"), Purolator Products Air
Filtration Company, a Delaware corporation ("PPAFC"), United Air Specialists,
Inc., an Ohio corporation ("United"), J.L. Clark, Inc., a Delaware corporation
("Clark"), Airguard Industries, Inc., a Kentucky corporation ("Airguard"),
Baldwin Filters, Inc., a Delaware corporation ("Baldwin"), Purolator Facet,
Inc., a Delaware corporation ("Purolator Facet"), Total Filtration Services,
Inc., an Ohio corporation ("TFS"); Filter Products, Inc., a Delaware corporation
("FPI"); and Facet USA Inc., a Delaware corporation ("Facet USA"), in connection
with the Subsidiary Guaranty referred to in the Agreement and dated as of April
8, 2003 (the "Guaranty"). Consumer, Filtration, PPAFC, United, Clark, Airguard,
Baldwin, Purolator Facet, TFS, FPI and Facet USA are individually referred to
herein as a "Guarantor" and collectively as "Guarantors". The Guarantors are
each direct or indirect wholly-owned subsidiaries of the Company. Capitalized
terms not defined herein have the meanings provided in the Agreement. This
letter is being delivered to you in satisfaction of the condition set forth in
Section 4.1(d) of the Agreement.
In connection with the opinions expressed below, I have relied, as to various
questions of fact material to such opinions, upon the representations made by
the Company in the Agreement and upon certificates delivered by or on behalf of
the Company and the Guarantors on the date hereof. I have examined originals, or
copies of originals certified or otherwise identified to my satisfaction, of the
Agreement, the Notes, the Guaranty and such other agreements, documents,
certificates of officers and other representatives of the Company and the
Guarantors, certificates and other statements of government officials and other
instruments, have examined such questions of law and have satisfied myself as to
such matters of fact as I have considered relevant and necessary as a basis for
the opinions hereinafter expressed. I have assumed the authenticity of all
documents submitted to me as originals, the genuineness of all signatures (other
than signatures of officers of the Company and the Guarantors), the legal
capacity of all natural persons and the conformity with the original documents
of any copies thereof submitted to me for my examination.
In rendering the opinions set forth herein, I have assumed, with your approval
that:
(i) All the parties to the Loan Documents, other than the Company
and the Guarantors, are duly organized, validly existing and
in good standing under the laws of their
respective jurisdictions of organization and have the
requisite corporate power to enter into such Loan Documents;
and
(ii) The execution and delivery of the Loan Documents have been
duly authorized by all necessary corporate action and
proceedings on the part of all parties thereto other than the
Company and the Guarantors; the Loan Documents have been duly
executed and delivered by all parties thereto other than the
Company and the Guarantors; and the Loan Documents constitute
the valid and binding obligations of all parties thereto other
than the Company and the Guarantors, enforceable against such
parties in accordance with their respective terms.
Based on the foregoing, it is my opinion that:
1. The Company and each of the Guarantors is a corporation duly
incorporated, validly existing and in good standing under the laws of
their respective jurisdictions of organization. The Company and each of
the Guarantors is qualified to do business in, and is in good standing
in the respective states listed on Exhibit A to this letter in which
their respective primary facilities are located. The Company and each
of the Guarantors have the corporate power to carry on their respective
businesses as such businesses are described in the Company's Annual
Report on Form 10-K for the fiscal year ended November 30, 2002.
2. The Company's execution, delivery and performance of the Agreement and
the Notes: (a) are within the Company's corporate powers; (b) have been
duly authorized by all necessary corporate action by the Company; (c)
do not breach or violate its restated certificate of incorporation, as
amended, or the bylaws of the Company or, to my knowledge, any
provision in any indenture, mortgage, contract or agreement to which
the Company is a party or by which it or its properties may be bound;
and (d) do not breach or violate any law, rule or regulation (including
Regulation U of the Federal Reserve Board) applicable to the Company or
require any action by or consent of or filing with any federal or state
governmental or public body or authority.
3. Each Guarantor's execution, delivery and performance of the Guaranty:
(a) is within the corporate power of such Guarantor; (b) has been duly
authorized by all necessary corporate action by such Guarantor; (c)
does not breach or violate the certificate of incorporation or the
bylaws of such Guarantor or, to my knowledge, any provision in any
indenture, mortgage, contract or agreement to which such Guarantor is a
party or by which it or its properties may be bound; and (d) does not
breach or violate any law, rule or regulation applicable to such
Guarantor or require any action by or consent of or filing with any
federal or state governmental or public body or authority.
4. The Agreement and the Notes are each the legal, valid and binding
obligations of the Company enforceable against the Company in
accordance with their respective terms.
5. The Guaranty is the legal, valid and binding obligation of each of the
Guarantors enforceable against each of the Guarantors in accordance
with its terms.
6. It is not necessary, in connection with the issuance and delivery of
the Notes on the date hereof, under the circumstances contemplated by
the Agreement, to register the Notes
69
under the Securities Act or to qualify an indenture in respect of the
Notes under the Trust Indenture Act of 1939, as amended.
7. Neither the Company nor any of the Guarantors is an "investment
company" or a company "controlled" by an "investment company" under the
Investment Company Act of 1940, as amended.
8. To my knowledge, there are no pending or overtly threatened actions or
proceedings against the Company or any of its Subsidiaries before any
court, governmental agency or arbitrator which purport to affect the
legality, validity, binding effect or enforceability of the Agreement,
the Notes or the Guaranty.
To the extent my opinions set forth in paragraph 1 above cover states other than
Illinois and Delaware, such opinions are based solely on certificates and other
statements of government officials of such states of which you have copies.
My opinions in paragraphs 4 and 5 above are subject to the effect of any
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or similar laws affecting creditors' rights generally, to the effect
of general principles of equity (regardless whether considered in a proceeding
in equity or at law) and to limitations imposed by public policy under certain
circumstances on the enforceability of provisions indemnifying a party against
liability for its own wrongful or negligent acts. In applying principles of
equity referred to above, a court, among other things, might not allow a
creditor to accelerate maturity of a debt upon the occurrence of a default
deemed immaterial. Such principles applied by a court might include a
requirement that a creditor act reasonably and in good faith.
Certain provisions of Article 15 of the Agreement may be unenforceable in whole
or in part, but the inclusion of such provisions does not affect the validity of
the Loan Documents; however, the unenforceability of such provisions may result
in delays in the enforcement of the Lender's rights and remedies under the Loan
Documents (and I express no opinion as to the economic consequences, if any, of
such delays).
I express no opinion as to the effect of the compliance or noncompliance of any
Lender with any state or federal laws or regulations applicable to the Lender
because of its legal or regulatory status, the nature of its business or its
authority to conduct business in any jurisdiction.
This opinion is limited to the General Corporation Law of the State of Delaware
and the laws of the United States of America and the State of Illinois, and I
express no opinion with respect to the laws of any other state or jurisdiction.
Whenever in this opinion reference is made to my knowledge, such reference to my
actual knowledge of information regarding factual matters.
This letter is being delivered as of the date hereof and is solely for the
benefit of the Persons to whom it is addressed and any other Person which
becomes an assignee of a Lender under Section 12.3 of the Agreement. It may not
be relied on in any manner or for any purpose by any other Person, and it may
not be quoted, filed with any governmental authority or other regulatory agency
or otherwise circulated or utilized for any other purpose without express prior
written consent. I do not express any opinion, either implicitly or otherwise,
on any issue not expressly addressed in numbered Paragraphs 1 through 8. The
opinions expressed above are based solely on facts, laws and regulations in
effect on the date hereof, and I assume no obligation to revise or supplement
this opinion should such fact change or should such laws or
70
regulations be changed by legislative or regulatory action, judicial decision or
otherwise, notwithstanding that such changes may affect the legal analysis or
conclusions contained herein.
Very truly yours,
71
EXHIBIT B
COMPLIANCE CERTIFICATE
To: The Lenders parties to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain
Credit Agreement dated as of April 8, 2003, (as amended, modified, renewed or
extended from time to time, the "Agreement") among CLARCOR Inc., a Delaware
corporation (the "Borrower"), the lenders party thereto and Bank One, NA, as
Agent for the Lenders and as LC Issuer. Unless otherwise defined herein,
capitalized terms used in this Compliance Certificate have the meanings ascribed
thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ______________ of the Borrower;
2. I have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Borrower and its Subsidiaries during the
accounting period covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes a Default or Unmatured Default during or at the end of the
accounting period covered by the attached financial statements or as of the date
of this Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain covenants of the
Agreement, all of which data and computations are true, complete and correct.
5. Schedule II hereto sets forth the determination of the
interest rates to be paid for Advances, the LC Fee rates and the commitment fee
rates commencing on the fifth day following the delivery hereof.
6. Schedule III attached hereto sets forth the various reports
and deliveries which are required at this time under the Agreement, and the
other Loan Documents and the status of compliance.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
72
The foregoing certifications, together with the computations set forth
in Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this 8th day of
April, 2003.
CLARCOR INC.
By:
--------------------------------------
Bruce A. Klein
Vice President-Finance and
Chief Financial Officer
73
SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of April 8, 2003 with
Sections 6.18.1, 6.18.2 and 6.18.3 of
the Agreement
74
SCHEDULE II TO COMPLIANCE CERTIFICATE
Borrower's Applicable Margin Calculation
75
SCHEDULE III TO COMPLIANCE CERTIFICATE
Reports and Deliveries Currently Due
76
EXHIBIT C
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (the "Assignment and Assumption") is
dated as of the Effective Date set forth below and is entered into by and
between [Insert name of Assignor] (the "Assignor") and [Insert name of Assignee]
(the "Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
"Credit Agreement"), receipt of a copy of which is hereby acknowledged by the
Assignee. The Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Agent as contemplated below, the interest in and to all of the Assignor's rights
and obligations in its capacity as a Lender under the Credit Agreement and any
other documents or instruments delivered pursuant thereto that represents the
amount and percentage interest identified below of all of the Assignor's
outstanding rights and obligations under the respective facilities identified
below (including without limitation any letters of credit, guaranties and Swing
Line loans included in such facilities and, to the extent permitted to be
assigned under applicable law, all claims (including without limitation contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
"Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor: ___________________________
2. Assignee: ___________________________ and is an Affiliate/Approved
Fund of [identify Lender](1)
3. Borrower(s): ___________________________
4. Agent: ___________________________, as the agent under the
Credit Agreement.
5. Credit Agreement: The [amount] Credit Agreement dated as of __________
among [name of Borrower(s)], the Lenders party
thereto, [name of Agent], as Agent, and the other
agents party thereto.
(1) Select as applicable.
6. Assigned Interest:
Aggregate Amount of
Commitment/Loans for all Amount of Commitment/Loans Percentage Assigned of
Facility Assigned Lenders* Assigned* Commitment/Loans(2)
- ----------------- ------------------------ -------------------------- ----------------------
(3) $ $ %
$ $ %
$ $ %
77
7. Trade Date:____________________________(4)
Effective Date: ____________________, 20__ [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
--------------------------------------
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
--------------------------------------
Title:
[Consented to and](5) Accepted:
[NAME OF AGENT], as Agent
By:
----------------------------
Title:
[Consented to:](6)
* Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.
(2) Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.
(3) Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. "Revolving
Credit Commitment," "Term Loan Commitment,", etc.)
(4) Insert if satisfaction of minimum amounts is to be determined as of the
Trade Date.
(5) To be added only if the consent of the Agent is required by the terms of the
Credit Agreement.
(6) To be added only if the consent of the Borrower and/or other parties (e.g.
Swingline Lender, L/C Issuer) is required by the terms of the Credit Agreement.
[NAME OF RELEVANT PARTY]
By:
----------------------------
Title:
78
ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1. Assignor. The Assignor represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any Lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby. Neither the Assignor nor any of
its officers, directors, employees, agents or attorneys shall be responsible for
(i) any statements, warranties or representations made in or in connection with
the Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency, perfection, priority,
collectibility, or value of the Loan Documents or any collateral thereunder,
(iii) the financial condition of the Borrower, any of its Subsidiaries or
Affiliates or any other Person obligated in respect of any Loan Document, (iv)
the performance or observance by the Borrower, any of its Subsidiaries or
Affiliates or any other Person of any of their respective obligations under any
Loan Document, (v) inspecting any of the property, books or records of the
Borrower, or any guarantor, or (vi) any mistake, error of judgment, or action
taken or omitted to be taken in connection with the Loans or the Loan Documents.
1.2. Assignee. The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Lender thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Lender thereunder, (iii)
agrees that its payment instructions and notice instructions are as set forth in
Schedule 1 to this Assignment and Assumption, (iv) confirms that none of the
funds, monies, assets or other consideration being used to make the purchase and
assumption hereunder are "plan assets" as defined under ERISA and that its
rights, benefits and interests in and under the Loan Documents will not be "plan
assets" under ERISA, (v) agrees to indemnify and hold the Assignor harmless
against all losses, costs and expenses (including, without limitation,
reasonable attorneys' fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee's non-performance of
the obligations assumed under this Assignment and Assumption, (vi) it has
received a copy of the Credit Agreement, together with copies of financial
statements and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the Agent
or any other Lender, and (vii) attached as Schedule 1 to this Assignment and
Assumption is any documentation required to be delivered by the Assignee with
respect to its tax status pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee and (b) agrees that (i) it will,
independently and without reliance on the Agent, the Assignor or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Loan Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.
2. Payments. The Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee. From and
after the Effective Date, the Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees
79
and other amounts) to the Assignor for amounts which have accrued to but
excluding the Effective Date and to the Assignee for amounts which have accrued
from and after the Effective Date.
3. General Provisions. This Assignment and Assumption
shall be binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the State of Illinois.
80
ADMINISTRATIVE QUESTIONNAIRE
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
81
EXHIBIT D
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To Bank One, NA,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Credit Agreement, dated ______________, _______ (as the same may be
amended or modified, the "Credit Agreement"), among CLARCOR Inc., a
Delaware corporation (the "Borrower"), the Lenders named therein, the
LC Issuer and the Agent. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned thereto in
the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s) ______________________________________________
Customer/Account Name __________________________________________________________
Transfer Funds To ______________________________________________________________
__________________________________________________________
For Account No. ________________________________________________________________
Reference/Attention To ________________________________________________
Authorized Officer (Customer Representative) Date
------------------
- -------------------------------------------- -------------------------------
(Please Print) Signature
Bank Officer Name Date
---------------------------
- -------------------------------------------- -------------------------------
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
82
EXHIBIT E
NOTE
April 8, 2003
CLARCOR Inc., a Delaware corporation (the "Borrower"), promises to pay
to the order of ____________________________________ (the "Lender") the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Article 2 of the Agreement (as hereinafter defined), in
immediately available funds at the place specified pursuant to Article 2 of the
Agreement, together with interest on the unpaid principal amount hereof at the
rates and on the dates set forth in the Agreement. The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of April __, 2003 (which, as it
may be amended or modified and in effect from time to time, is herein called the
"Agreement"), among the Borrower, and the lenders party thereto, including the
Lender, the LC Issuer and Bank One, NA, as Agent, to which Agreement reference
is hereby made for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this Note may be prepaid or its
maturity date accelerated. This Note is guaranteed pursuant to the Subsidiary
Guaranty Agreement, all as more specifically described therein, and reference is
made thereto for a statement of the terms and provisions thereof. Capitalized
terms used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
CLARCOR INC.
By:
--------------------------------------
Bruce A. Klein
Vice President-Finance and
Chief Financial Officer
83
EXHIBIT F
SUBSIDIARY GUARANTY
THIS SUBSIDIARY GUARANTY (this "GUARANTY") is made as of the 8th day of
April, 2003, by Airguard Industries, Inc., a Kentucky corporation, Baldwin
Filters, Inc., a Delaware corporation, CLARCOR Consumer Products, Inc., a
Delaware corporation, CLARCOR Filtration Products, Inc., a Delaware corporation,
Facet USA Inc., a Delaware corporation, Filter Products, Inc., a Delaware
corporation, J.L. Clark, Inc., a Delaware corporation, Purolator Facet, Inc., a
Delaware corporation, Purolator Products Air Filtration Company, a Delaware
corporation, Total Filtration Services, Inc., an Oho corporation and United Air
Specialists, Inc., an Ohio corporation (collectively, the "SUBSIDIARY
GUARANTORS") in favor of the Agent, for the benefit of the Lenders, under the
Credit Agreement referred to below;
WITNESSETH:
WHEREAS, CLARCOR Inc., a Delaware corporation (the "PRINCIPAL") and
Bank One, NA, a national banking association, having its principal office in
Chicago, Illinois, as Agent (the "AGENT"), and certain other Lenders from time
to time party thereto have entered into a certain Credit Agreement dated as of
even date herewith (as same may be amended or modified from time to time, the
"CREDIT AGREEMENT"), providing, subject to the terms and conditions thereof, for
extensions of credit to be made by the Lenders to the Principal;
WHEREAS, it is a condition precedent to the Agent and the Lenders
executing the Credit Agreement that each of the Subsidiary Guarantors execute
and deliver this Guaranty whereby each of the Subsidiary Guarantors shall
guarantee the payment when due, subject to Section 9 hereof, of all Guaranteed
Obligations, as defined below; and
WHEREAS, in consideration of the financial and other support that the
Principal has provided, and such financial and other support as the Principal
may in the future provide, to the Subsidiary Guarantors, and in order to induce
the Lenders and the Agent to enter into the Credit Agreement, and the Lenders
and their Affiliates to enter into one or more Rate Management Transactions with
the Principal, and because each Subsidiary Guarantor has determined that
executing this Guaranty is in its interest and to its financial benefit, each of
the Subsidiary Guarantors is willing to guarantee the obligations of the
Principal under the Credit Agreement, any Note, any Rate Management Transaction,
and the other Loan Documents;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1.1. Selected Terms Used Herein.
"GUARANTEED OBLIGATIONS" is defined in Section 3 below.
"RATE MANAGEMENT TRANSACTION" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered into between
the Principal and any Lender or Affiliate thereof which is a rate swap, basis
swap, forward rate transaction, commodity swap, commodity option, equity or
equity index swap, equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction
84
(including any option with respect to any of these transactions) or any
combination thereof, whether linked to one or more interest rates, foreign
currencies, commodity prices, equity prices or other financial measures.
"RATE MANAGEMENT OBLIGATIONS" means any and all obligations of the
Principal, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
SECTION 1.2. Terms in Credit Agreement. Other capitalized terms used
herein but not defined herein shall have the meaning set forth in the Credit
Agreement.
SECTION 2.1. Representations and Warranties. Each of the Subsidiary
Guarantors represents and warrants (which representations and warranties shall
be deemed to have been renewed upon each Borrowing Date under the Credit
Agreement) that:
(a) It is a corporation, partnership or limited liability
company duly and properly incorporated or organized, as the case may be, validly
existing and (to the extent such concept applies to such entity) in good
standing under the laws of its jurisdiction of incorporation or organization and
has all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
(b) It has the power and authority and legal right to
execute and deliver this Guaranty and to perform its obligations hereunder. The
execution and delivery by it of this Guaranty and the performance of its
obligations hereunder have been duly authorized by proper corporate proceedings,
and this Guaranty constitutes a legal, valid and binding obligation of such
Subsidiary Guarantor enforceable against it in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally.
(c) Neither the execution and delivery by it of this
Guaranty, nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof will violate (i) any law, rule,
regulation, order, writ, judgment, injunction, decree or award binding on it or
any of its subsidiaries or (ii) its articles or certificate of incorporation,
partnership agreement, certificate of partnership, articles or certificate of
organization, by-laws, or operating or other management agreement, as the case
may be, or (iii) the provisions of any indenture, instrument or agreement to
which it or any of its subsidiaries is a party or is subject, or by which it, or
its Property, is bound, or conflict with or constitute a default thereunder, or
result in, or require, the creation or imposition of any Lien in, of or on the
Property of such Subsidiary Guarantor or a subsidiary thereof pursuant to the
terms of any such indenture, instrument or agreement. No order, consent,
adjudication, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, or other action in respect of
any governmental or public body or authority, or any subdivision thereof, which
has not been obtained by it or any of its subsidiaries, is required to be
obtained by it or any of its subsidiaries in connection with the execution and
delivery of this Guaranty or the performance by it of its obligations hereunder
or the legality, validity, binding effect or enforceability of this Guaranty.
SECTION 2.2. Covenants. Each of the Subsidiary Guarantors covenants
that, so long as any Lender has any Commitment outstanding under the Credit
Agreement, any Rate Management Transaction remains in effect or any of the
Guaranteed Obligations shall remain unpaid, that it will, and, if necessary,
will enable the Principal to, fully comply with those covenants and agreements
set forth in the Credit Agreement.
85
SECTION 3. The Guaranty. Subject to Section 9 hereof, each of the
Subsidiary Guarantors hereby absolutely and unconditionally guarantees, as
primary obligor and not as surety, the full and punctual payment (whether at
stated maturity, upon acceleration or early termination or otherwise, and at all
times thereafter) and performance of the Obligations and the Rate Management
Obligations, including without limitation any such Obligations or Rate
Management Obligations incurred or accrued during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, whether or not
allowed or allowable in such proceeding (collectively, subject to the provisions
of Section 9 hereof, being referred to collectively as the "GUARANTEED
Obligations"). Upon failure by the Principal to pay punctually any such amount
(including without limitation any Reimbursement Obligation), each of the
Subsidiary Guarantors agrees that it shall forthwith on demand pay to the Agent
for the benefit of the Lenders and, if applicable, their Affiliates, the amount
not so paid at the place and in the manner specified in the Credit Agreement,
any Note, any Rate Management Transaction or the relevant Loan Document, as the
case may be. Each Subsidiary Guaranty is and shall be severally liable for
payment and performance in fill of all Guaranteed Obligations. This Guaranty is
a guaranty of payment and not of collection. Each of the Subsidiary Guarantors
waives any right to require the Agent and/or the Lenders to sue the Principal,
any other Subsidiary Guarantor, any other guarantor, or any other person
obligated for all or any part of the Guaranteed Obligations, or otherwise to
enforce its payment against any collateral securing all or any part of the
Guaranteed Obligations.
SECTION 4. Guaranty Unconditional. Subject to Section 9 hereof, the
obligations of each of the Subsidiary Guarantors hereunder shall be
unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect of any of the Guaranteed Obligations, by operation
of law or otherwise, or any obligation of any other guarantor of any of
the Guaranteed Obligations, or any default, failure or delay, willful
or otherwise, in the payment or performance of the Guaranteed
Obligations;
(ii) any modification or amendment of or supplement to the Credit
Agreement, any Note, any Rate Management Transaction or any other Loan
Document;
(iii) any release, nonperfection or invalidity of any direct or
indirect security for any obligation of the Principal under the Credit
Agreement, any Note, any Rate Management Transaction, any other Loan
Document, or any obligations of any other guarantor of any of the
Guaranteed Obligations, or any action or failure to act by the Agent,
any Lender or any Affiliate of any Lender with respect to any
collateral securing all or any part of the Guaranteed Obligations;
(iv) any change in the corporate existence, structure or ownership
of the Principal, any other Subsidiary Guarantor, or any other
guarantor of any of the Guaranteed Obligations, or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting the
Principal, any other Subsidiary Guarantor, or any other guarantor of
the Guaranteed Obligations, or its assets or any resulting release or
discharge of any obligation of the Principal, or any other guarantor of
any of the Guaranteed Obligations;
(v) the existence of any claim, setoff or other rights which the
Subsidiary Guarantors may have at any time against the Principal, any
other guarantor of any of the Guaranteed Obligations, the Agent, any
Lender or any other Person, whether in connection herewith or any
unrelated transactions;
86
(vi) any invalidity or unenforceability relating to or against the
Principal, or any other guarantor of any of the Guaranteed Obligations,
for any reason related to the Credit Agreement, any Rate Management
Transaction, any other Loan Document, or any provision of applicable
law or regulation purporting to prohibit the payment by the Principal,
or any other guarantor of the Guaranteed Obligations, of the principal
of or interest on any Note or any other amount payable by the Principal
under the Credit Agreement, any Note, any Rate Management Transaction
or any other Loan Document; or
(vii) any other act or omission to act or delay of any kind by the
Principal, any other guarantor of the Guaranteed Obligations, the
Agent, any Lender or any other Person or any other circumstance
whatsoever which might, but for the provisions of this paragraph,
constitute a legal or equitable discharge of any Subsidiary Guarantor's
obligations hereunder.
SECTION 5. Discharge Only Upon Payment In Full: Reinstatement In
Certain Circumstances. Each of the Subsidiary Guarantor's obligations hereunder
shall remain in full force and effect until all Guaranteed Obligations shall
have been indefeasibly paid in full, the Commitments under the Credit Agreement
shall have terminated or expired and all Rate Management Transactions have
terminated or expired. If at any time any payment of the principal of or
interest on any Note or any other amount payable by the Principal or any other
party under the Credit Agreement, any Rate Management Transaction or any other
Loan Document is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of the Principal or otherwise, each of
the Subsidiary Guarantor's obligations hereunder with respect to such payment
shall be reinstated as though such payment had been due but not made at such
time.
SECTION 6. Waivers. Each of the Subsidiary Guarantors irrevocably
waives acceptance hereof, presentment, demand, protest and, to the fullest
extent permitted by law, any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Principal, any other guarantor of any of the Guaranteed Obligations, or any
other Person.
SECTION 7. Subrogation. Each of the Subsidiary Guarantors hereby agrees
not to assert any right, claim or cause of action, including, without
limitation, a claim for subrogation, reimbursement, indemnification or
otherwise, against the Principal arising out of or by reason of this Guaranty or
the obligations hereunder, including, without limitation, the payment or
securing or purchasing of any of the Guaranteed Obligations by any of the
Subsidiary Guarantors unless and until the Guaranteed Obligations are
indefeasibly paid in full, any commitment to lend under the Credit Agreement and
any other Loan Documents is terminated and all Rate Management Transactions have
terminated or expired.
SECTION 8. Stay of Acceleration. If acceleration of the time for
payment of any of the Guaranteed Obligations is stayed upon the insolvency,
bankruptcy or reorganization of the Principal, all such amounts otherwise
subject to acceleration under the terms of the Credit Agreement, any Note, any
Rate Management Transaction or any other Loan Document shall nonetheless be
payable by each of the Subsidiary Guarantors hereunder forthwith on demand by
the Agent made at the request of the Required Lenders.
SECTION 9. Limitation on Obligations. (a) The provisions of this
Guaranty are severable, and in any action or proceeding involving any state
corporate law, or any state, federal or foreign bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Subsidiary Guarantor under this Guaranty would otherwise be
held or determined to be avoidable, invalid or unenforceable on account of the
amount of such Subsidiary Guarantor's liability under this Guaranty, then,
notwithstanding any other provision of this Guaranty to the contrary, the amount
of such liability shall, without any further action by the Subsidiary
Guarantors, the Agent or any Lender, be automatically limited and reduced to the
highest amount that is valid and enforceable as determined in such action or
proceeding
87
(such highest amount determined hereunder being the relevant Subsidiary
Guarantor's "MAXIMUM LIABILITY"). This Section 9(a) with respect to the Maximum
Liability of the Subsidiary Guarantors is intended solely to preserve the rights
of the Agent hereunder to the maximum extent not subject to avoidance under
applicable law, and neither the Subsidiary Guarantor nor any other person or
entity shall have any right or claim under this Section 9(a) with respect to the
Maximum Liability, except to the extent necessary so that the obligations of the
Subsidiary Guarantor hereunder shall not be rendered voidable under applicable
law.
(b) Each of the Subsidiary Guarantors agrees that the Guaranteed
Obligations may at any time and from time to time exceed the Maximum Liability
of each Subsidiary Guarantor, and may exceed the aggregate Maximum Liability of
all other Subsidiary Guarantors, without impairing this Guaranty or affecting
the rights and remedies of the Agent hereunder. Nothing in this Section 9(b)
shall be construed to increase any Subsidiary Guarantor's obligations hereunder
beyond its Maximum Liability.
(c) In the event any Subsidiary Guarantor (a "PAYING SUBSIDIARY
GUARANTOR") shall make any payment or payments under this Guaranty or shall
suffer any loss as a result of any realization upon any collateral granted by it
to secure its obligations under this Guaranty, each other Subsidiary Guarantor
(each a "NON-PAYING SUBSIDIARY GUARANTOR") shall contribute to such Paying
Subsidiary Guarantor an amount equal to such Non-Paying Subsidiary Guarantor's
"PRO RATA SHARE" of such payment or payments made, or losses suffered, by such
Paying Subsidiary Guarantor. For the purposes hereof, each Non-Paying Subsidiary
Guarantor's "PRO RATA Share" with respect to any such payment or loss by a
Paying Subsidiary Guarantor shall be determined as of the date on which such
payment or loss was made by reference to the ratio of (i) such Non-Paying
Subsidiary Guarantor's Maximum Liability as of such date (without giving effect
to any right to receive, or obligation to make, any contribution hereunder) or,
if such Non-Paying Subsidiary Guarantor's Maximum Liability has not been
determined, the aggregate amount of all monies received by such Non-Paying
Subsidiary Guarantor from the Principal after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Subsidiary Guarantors hereunder (including such Paying Subsidiary Guarantor)
as of such date (without giving effect to any right to receive, or obligation to
make, any contribution hereunder), or to the extent that a Maximum Liability has
not been determined for any Subsidiary Guarantors, the aggregate amount of all
monies received by such Subsidiary Guarantors from the Principal after the date
hereof (whether by loan, capital infusion or by other means). Nothing in this
Section 9 (c) shall affect any Subsidiary Guarantor's several liability for the
entire amount of the Guaranteed Obligations (up to such Subsidiary Guarantor's
Maximum Liability). Each of the Subsidiary Guarantors covenants and agrees that
its right to receive any contribution under this Guaranty from a Non-Paying
Subsidiary Guarantor shall be subordinate and junior in right of payment to all
the Guaranteed Obligations. The provisions of this Section 9(c) are for the
benefit of both the Agent and the Subsidiary Guarantors and may be enforced by
any one, or more, or all of them in accordance with the terms hereof.
SECTION 10. Application of Payments. All payments received by the Agent
hereunder shall be applied by the Agent to payment of the Guaranteed Obligations
in the following order unless a court of competent jurisdiction shall otherwise
direct:
(a) FIRST, to payment of all costs and expenses of the
Agent incurred in connection with the collection and enforcement of the
Guaranteed Obligations or of any security interest granted to the Agent
in connection with any collateral securing the Guaranteed Obligations;
(b) SECOND, to payment of that portion of the Guaranteed
Obligations constituting accrued and unpaid interest and fees, pro rata
among the Lenders and their Affiliates in accordance with the
provisions of the Credit Agreement;
88
(c) THIRD, to payment of the principal of the Guaranteed
Obligations and the net early termination payments and any other Rate
Management Obligations then due and unpaid from the Borrower to any of
the Lenders or their Affiliates, pro rata among the Lenders and their
Affiliates in accordance with the terms of the Credit Agreement; and
(d) FOURTH, to payment of any Guaranteed Obligations
(other than those listed above) pro rata among those parties to whom
such Guaranteed Obligations are due in accordance with the amounts
owing to each of them.
SECTION 11. Notices. All notices, requests and other communications to
any party hereunder shall be given or made by telecopier or other writing and
telecopied, or mailed or delivered to the intended recipient at its address or
telecopier number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for such purpose by
notice to the Agent in accordance with the provisions of Article XIII of the
Credit Agreement. Except as otherwise provided in this Guaranty, all such
communications shall be deemed to have been duly given when transmitted by
telecopier, or personally delivered or, in the case of a mailed notice sent by
certified mail return-receipt requested, on the date set forth on the receipt
(provided, that any refusal to accept any such notice shall be deemed to be
notice thereof as of the time of any such refusal), in each case given or
addressed as aforesaid.
SECTION 12. No Waivers. No failure or delay by the Agent or any Lenders
in exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies provided in this Guaranty, the Credit Agreement, any
Note, any Rate Management Transaction and the other Loan Documents shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 13. No Duty to Advise. Each of the Subsidiary Guarantors
assumes all responsibility for being and keeping itself informed of the
Principal'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 that each of the Subsidiary Guarantors
assumes and incurs under this Guaranty, and agrees that neither the Agent nor
any Lender has any duty to advise any of the Subsidiary Guarantors of
information known to it regarding those circumstances or risks.
SECTION 14. Successors and Assigns. This Guaranty is for the benefit of
the Agent and the Lenders and their respective successors and permitted assigns
and in the event of an assignment of any amounts payable under the Credit
Agreement, any Note, any Rate Management Transaction, or the other Loan
Documents, the rights hereunder, to the extent applicable to the indebtedness so
assigned, shall be transferred with such indebtedness. This Guaranty shall be
binding upon each of the Subsidiary Guarantors and their respective successors
and permitted assigns.
SECTION 15. Changes in Writing. Neither this Guaranty nor any provision
hereof may be changed, waived, discharged or terminated orally, but only in
writing signed by each of the Subsidiary Guarantors and the Agent with the
consent of the Required Lenders.
SECTION 16. Costs of Enforcement. Each of the Subsidiary Guarantors
agrees to pay all costs and expenses including, without limitation, all court
costs and attorneys' fees and expenses paid or incurred by the Agent or any
Lender or any Affiliate of any Lender in endeavoring to collect all or any part
of the Guaranteed Obligations from, or in prosecuting any action against, the
Principal, the Subsidiary Guarantors or any other guarantor of all or any part
of the Guaranteed Obligations.
89
SECTION 17. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE STATE OF ILLINOIS. EACH OF THE SUBSIDIARY GUARANTORS HEREBY SUBMITS
TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ILLINOIS AND OF ANY ILLINOIS STATE COURT SITTING IN
CHICAGO, ILLINOIS AND FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS GUARANTY (INCLUDING, WITHOUT LIMITATION, ANY OF THE OTHER LOAN
DOCUMENTS) OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE SUBSIDIARY
GUARANTORS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE SUBSIDIARY GUARANTORS, AND THE AGENT AND THE LENDERS ACCEPTING THIS
GUARANTY, HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 18. Taxes. etc. All payments required to be made by any of the
Subsidiary Guarantors hereunder shall be made without setoff or counterclaim and
free and clear of and without deduction or withholding for or on account of, any
present or future taxes, levies, imposts, duties or other charges of whatsoever
nature imposed by any government or any political or taxing authority thereof
(but excluding Excluded Taxes), provided, however, that if any of the Subsidiary
Guarantors is required by law to make such deduction or withholding, such
Subsidiary Guarantor shall forthwith (i) pay to the Agent or any Lender, as
applicable, such additional amount as results in the net amount received by the
Agent or any Lender, as applicable, equaling the full amount which would have
been received by the Agent or any Lender, as applicable, had no such deduction
or withholding been made, (ii) pay the full amount deducted to the relevant
authority in accordance with applicable law, and (iii) furnish to the Agent or
any Lender, as applicable, certified copies of official receipts evidencing
payment of such withholding taxes within 30 days after such payment is made.
SECTION 19. Setoff. Without limiting the rights of the Agent or the
Lenders under applicable law, if all or any part of the Guaranteed Obligations
is then due, whether pursuant to the occurrence of a Default or otherwise, then
the Guarantor authorizes the Agent and the Lenders to apply any sums standing to
the credit of the Guarantor with the Agent or any Lender or any Lending
Installation of the Agent or any Lender toward the payment of the Guaranteed
Obligations.
SECTION 20. Foreign Currency. The specification of payment in a
specific currency at a specific place and time pursuant to the Credit Agreement,
any Note, any Rate Management Transaction or any other Loan Document is
essential. That currency or those currencies are also the currency of account
and payment under this Guaranty. If any Subsidiary Guarantor is unable for any
reason to effect payment of a specific currency (other than United States
currency) as required by the preceding sentence or if any Subsidiary Guarantor
defaults in the payment when due of any payment of a specific currency (other
than United States currency) under this Guaranty, the Agent may, at its option,
require such payment to be made to the Agent's principal office in the
equivalent amount in United States currency at the Agent's then current selling
rate for electronic transfers of that currency to the place or places where the
Guaranteed Obligations were payable. In the event that any payment, whether
pursuant to a judgment or otherwise, does not result in payment of the amount of
currency due under this Guaranty, upon conversion to the currency of account and
transfer to the place specified for payment, the Agent and the Lenders have an
independent cause of action against the Subsidiary Guarantors for the
deficiency.
90
IN WITNESS WHEREOF, each of the Subsidiary Guarantors has caused this
Guaranty to be duly executed, under seal, by its authorized officer as of the
day and year first above written.
Airguard Industries, Inc.
Baldwin Filters, Inc.
CLARCOR Consumer Products, Inc.
CLARCOR Filtration Products, Inc.
Facet USA Inc.
Filter Products, Inc.
J.L. Clark, Inc.
Purolator Facet, Inc.
Purolator Products Air Filtration Company
Total Filtration Services, Inc.
United Air Specialists, Inc.
By:
--------------------------------------
Bruce A. Klein
Vice President and Treasurer
91
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF _________,
DATED __________,
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
- ---- --------- ----------- --------- -------
92
SCHEDULE 1
SUBSIDIARIES AND OTHER INVESTMENTS
(SEE SECTIONS 5.8 AND 6.14)
Investment Jurisdiction of Owned Amount of Percent
In Organization By Investment Ownership
---------- --------------- ----- ---------- ---------
JURISDICTION OF
INCORPORATION OR PERCENT OF
NAME ORGANIZATION OWNERSHIP*
---- ---------------- ----------
Domestic
CLARCOR Consumer Products, Inc. Delaware 100%
J.L. Clark, Inc. Delaware 100%
Clark Europe, Inc. Delaware 100%
CLARCOR Filtration Products, Inc. Delaware 100%
Airguard Industries, Inc. Kentucky 100%
Purolator Products Air Filtration Company Delaware 100%
Baldwin Filters, Inc. Delaware 100%
Baldwin South Africa, Inc. Delaware 100%
Clark Filter, Inc. Delaware 100%
Purolator Facet, Inc. Delaware 100%
Facet USA Inc. Delaware 100%
Filter Products, Inc. Delaware 100%
GS Costa Mesa, Inc. Delaware 100%
Total Filtration Services, Inc. Ohio 100%
United Air Specialists, Inc. Ohio 100%
CLARCOR International, Inc. Delaware 100%
CLARCOR Trading Company Delaware 100%
FilterSource California 100%
Total Filter Technology, Inc. Massachusetts 100%
International
Airklean Engineering Pte. Ltd. Singapore 100%
Airguard Asia Sdn. Bhd. Malaysia 100%
Airguard de Venezuela, S.A. Venezuela 70%
Baldwin Filters N.V. Belgium 100%
Baldwin Filters Limited United Kingdom 100%
Baldwin-Unifil S.A. South Africa 80%
Hastings Filters Ltd. Canada Canada 100%
Baldwin Filters (Aust.) Pty. Limited Australia 100%
CLARCOR UK Limited United Kingdom 100%
Filtros Baldwin de Mexico Mexico 90%
Facet FCE S.A.R.L. France 100%
Face Iberica S.A. Spain 100%
Facet Industrial B.V. Netherlands 100%
Facet Industrial U.K. Limited United Kingdom 100%
93
Facet Italiana, S.p.A. Italy 100%
Locker Filtration Limited United Kingdom 100%
Purolator Filter GmbH Germany 100%
Total Filtration Services LLC of VC Mexico 100%
Baldwin-Weifang Filters Ltd. China 75%
CLARCOR Foreign Sales Corporation Barbados 100%
* Direct or indirect
94
SCHEDULE 2
INDEBTEDNESS AND LIENS
(SEE SECTIONS 5.14, 6.11 AND 6.15)
Maturity
Indebtedness Indebtedness Property and Amount
Incurred By Owed To Encumbered (If Any) of Indebtedness
------------ ------------ ------------------- ---------------
95
SCHEDULE 3
EUROCURRENCY PAYMENT OFFICES OF THE AGENT
Currency Eurocurrency Payment Office
- -------- ---------------------------
Dollars Bank One, NA
Chicago, Illinois
96
SCHEDULE 4
LENDING INSTALLATIONS
Lender Floating Rate Loans Eurocurrency Loans (list all)
- ------ ------------------- -----------------------------
Bank One, NA Bank One, NA Bank One, NA
Chicago, Illinois London Branch
(for Pounds Sterling)
97