1
EXHIBIT 10.54
AMENDED AND RESTATED LOAN AGREEMENT
Dated as of November 3, 2000
between
TRACTOR SUPPLY COMPANY,
as Borrower,
AND
CERTAIN SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTY HERETO,
as Guarantors,
AND
SUNTRUST BANK,
as Lender
2
TABLE OF CONTENTS
SECTION 1 DEFINITIONS.......................................................................................... 5
1.1 Definitions............................................................................................ 5
1.2 Computation of Time Periods............................................................................ 19
1.3 Accounting Terms....................................................................................... 20
SECTION 2. THE LOAN............................................................................................. 20
2.1 The Loan............................................................................................... 20
2.2 Extension Option....................................................................................... 21
SECTION 3. OTHER PROVISIONS RELATING TO CREDIT FACILITIES....................................................... 21
3.1 Default Rate........................................................................................... 21
3.2 Prepayments............................................................................................ 21
3.3 Capital Adequacy....................................................................................... 21
3.4 Conversion Option...................................................................................... 22
3.5 Illegality............................................................................................. 22
3.6 Requirements of Law.................................................................................... 22
3.7 Taxes.................................................................................................. 23
3.8 Payments, Computations, Etc............................................................................ 24
SECTION 4 GUARANTY............................................................................................. 25
4.1 The Guaranty........................................................................................... 25
4.2 Obligations Unconditional.............................................................................. 26
4.3 Reinstatement.......................................................................................... 27
4.4 Certain Additional Waivers............................................................................. 27
4.5 Remedies............................................................................................... 27
4.6 Rights of Contribution................................................................................. 28
4.7 Guarantee of Payment; Continuing Guarantee............................................................. 29
SECTION 5 CONDITIONS........................................................................................... 29
5.1 Closing Conditions..................................................................................... 29
SECTION 6 REPRESENTATIONS AND WARRANTIES....................................................................... 31
6.1 Financial Condition.................................................................................... 31
6.2 No Material Change..................................................................................... 31
6.3 Organization and Good Standing; Compliance with Law.................................................... 31
6.4 Power; Authorization; Enforceable Obligations.......................................................... 32
6.5 No Conflicts........................................................................................... 32
6.6 Ownership.............................................................................................. 33
6.7 Indebtedness........................................................................................... 33
6.8 Litigation............................................................................................. 33
6.9 Taxes.................................................................................................. 33
6.10 Compliance with Law.................................................................................... 33
6.11 ERISA.................................................................................................. 33
6.12 Subsidiaries........................................................................................... 35
6.13 Governmental Regulations, Etc.......................................................................... 35
6.14 Purpose of Loan........................................................................................ 36
6.15 Environmental Matters.................................................................................. 36
6.16 Intellectual Property.................................................................................. 37
6.17 Solvency............................................................................................... 38
i
3
6.18 Investments............................................................................................ 38
6.19 Location of Assets..................................................................................... 38
6.20 Disclosure............................................................................................. 38
6.21 No Burdensome Restrictions............................................................................. 38
6.22 Brokers' Fees.......................................................................................... 38
6.23 Labor Matters.......................................................................................... 38
SECTION 7 AFFIRMATIVE COVENANTS................................................................................ 39
7.1 Financial Statements................................................................................... 39
7.2 Preservation of Existence and Franchises............................................................... 41
7.3 Books and Records...................................................................................... 42
7.4 Compliance with Law.................................................................................... 42
7.5 Payment of Taxes and Other Indebtedness................................................................ 42
7.6 Insurance.............................................................................................. 42
7.7 Maintenance of Property................................................................................ 42
7.8 Performance of Obligations............................................................................. 43
7.9 Use of Proceeds........................................................................................ 43
7.10 Audits/Inspections..................................................................................... 43
7.11 Financial Covenants.................................................................................... 43
7.12 Additional Credit Parties.............................................................................. 44
7.13 Environmental Laws..................................................................................... 44
SECTION 8 NEGATIVE COVENANTS................................................................................... 45
8.1 Indebtedness........................................................................................... 45
8.2 Liens.................................................................................................. 46
8.3 Nature of Business..................................................................................... 46
8.4 Consolidation, Merger, Dissolution, etc................................................................ 46
8.5 Asset Dispositions..................................................................................... 46
8.6 Investments............................................................................................ 46
8.7 Restricted Payments.................................................................................... 47
8.8 Prepayments of Indebtedness, etc....................................................................... 47
8.9 Transactions with Affiliates........................................................................... 47
8.10 Fiscal Year; Organizational Documents.................................................................. 47
8.11 Limitation on Restricted Actions....................................................................... 47
8.12 Ownership of Subsidiaries.............................................................................. 48
8.13 Sale Leasebacks........................................................................................ 48
8.14 Capital Expenditures................................................................................... 48
8.15 No Further Negative Pledges............................................................................ 49
SECTION 9 EVENTS OF DEFAULT.................................................................................... 49
9.1 Events of Default...................................................................................... 49
9.2 Acceleration; Remedies................................................................................. 52
Section 10. MISCELLANEOUS........................................................................................ 52
10.1 Notices................................................................................................ 52
10.2 Right of Set-Off; Adjustments.......................................................................... 53
10.3 Benefit of Agreement................................................................................... 53
10.4 No Waiver; Remedies Cumulative......................................................................... 55
10.5 Expenses; Indemnification.............................................................................. 55
10.6 Amendments, Waivers and Consents....................................................................... 56
ii
4
10.7 Counterparts........................................................................................ 56
10.8 Headings............................................................................................ 57
10.9 Survival............................................................................................ 57
10.10 Governing Law; Submission to Jurisdiction; Venue.................................................... 57
10.11 Severability........................................................................................ 58
10.12 Entirety............................................................................................ 58
10.13 Binding Effect; Termination......................................................................... 58
10.14 Confidentiality..................................................................................... 58
10.15 Use of Sources...................................................................................... 59
10.16 Conflict............................................................................................ 59
SCHEDULE 1.1 LIENS........................................................................................... 61
SCHEDULE 6.12 SUBSIDIARIES.................................................................................... 62
SCHEDULE 6.19 LOCATION OF ASSETS.............................................................................. 63
SCHEDULE 6.23 LABOR MATTERS................................................................................... 64
SCHEDULE 7.6 CERTIFICATE OF INSURANCE........................................................................ 65
SCHEDULE 8.1 EXISTING INDEBTEDNESS........................................................................... 66
SCHEDULE 8.9 TRANSACTIONS WITH AFFILIATES.................................................................... 67
EXHIBIT 7.1(C) FORM OF OFFICER'S COMPLIANCE CERTIFICATE....................................................... 69
EXHIBIT 7.12 FORM OF JOINDER AGREEMENT........................................................................ 72
EXHIBIT 10.3(B) FORM OF ASSIGNMENT AND ACCEPTANCE............................................................. 74
iii
5
SCHEDULES
Schedule 1.1 Liens
Schedule 6.12 Subsidiaries
Schedule 6.19 Chief Executive Offices/Principal Places of Business
Schedule 6.23 Labor Matters
Schedule 7.6 Certificate of Insurance
Schedule 8.1 Existing Indebtedness
Schedule 8.9 Transactions with Affiliates
EXHIBITS
Exhibit 7.1(c) Form of Officer's Compliance Certificate
Exhibit 7.12 Form of Joinder Agreement
Exhibit 10.3(b) Form of Assignment and Acceptance
iv
6
EXHIBIT 10.54
AMENDED AND RESTATED LOAN AGREEMENT
THIS AMENDED AND RESTATED LOAN AGREEMENT, dated as of November 3, 2000
(as amended, modified, restated or supplemented from time to time, the "Credit
Agreement"), is by and among TRACTOR SUPPLY COMPANY, a Delaware corporation (the
"Borrower"), the Subsidiary Guarantors (as defined herein), and SUNTRUST BANK,
successor-in-interest to SunTrust Bank, Nashville, N.A., a Georgia state banking
corporation (the "Lender").
WITNESSETH:
WHEREAS, Borrower and Lender entered into that certain Loan Agreement
dated as of June 30, 1998; and
WHEREAS, Borrower and Lender desire to amend and restate said Loan
Agreement as provided herein.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1.
DEFINITIONS
1.1 DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"30-Day Interbank Offered Rate" means the 30-Day LIBO Rate as quoted by
Telerate, Inc. and as set in Lender's Funds Management, Cost of Funds Report
published each Monday through Friday that Lender is open for business. If for
any reason such rate is not available, the term "30-Day Interbank Offered Rate"
shall mean the rate per annum (rounded, if necessary, to the nearest 1/100 of
1%) appearing each day on Reuters Screen LIBO Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m. (London time)
for a term of thirty (30) days; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded, if necessary, to the nearest 1/100
of 1%). As to any date on which no such rates are available, the term "30-Day
Interbank Offered Rate" shall mean such rate as determined on the next
proceeding Business Day when such rate was determinable.
"Additional Credit Party" means each Person that becomes a Subsidiary
Guarantor after the Closing Date by execution of a Joinder Agreement.
7
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Affiliate" means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person or (ii) directly or indirectly owning or holding
five percent (5%) or more of the Capital Stock in such Person. For purposes of
this definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Applicable Percentage" means, for purposes of calculating the Adjusted
Eurodollar Rate, the appropriate applicable percentage corresponding to the
Leverage Ratio in effect as of the most recent Calculation Date:
------------------------------------------
PRICING LEVERAGE APPLICABLE
LEVEL RATIO PERCENTAGE
------------------------------------------
I < 2.50 0.75%
------------------------------------------
II > 2.50 but < 3.0 0.875%
-
------------------------------------------
III > 3.0 but < 3.50 1.00%
-
------------------------------------------
IV > 3.50 but < 4.0 1.25%
-
------------------------------------------
V > 4.0 1.50%
-
------------------------------------------
The Applicable Percentages shall be determined and adjusted quarterly on the
date (each a "Calculation Date") five Business Days after the date by which the
Borrower is required to provide the officer's certificate in accordance with the
provisions of Section 7.1(c) for the most recently ended fiscal quarter of the
Consolidated Parties; provided, however, (i) until the first Calculation Date to
occur subsequent to September 30, 2000, the Applicable Percentages shall be
1.25%, and (ii) if the Borrower fails to provide the officer's certificate as
required by Section 7.1(c) for the last day of the most recently ended fiscal
quarter of the Consolidated Parties, the Applicable Percentage from such
Calculation Date shall be based on Pricing Level V until such time as an
appropriate officer's certificate is provided, whereupon the Applicable
Percentage shall be determined by the Leverage Ratio as of the last day of the
most recently ended fiscal quarter of the Consolidated Parties preceding such
Calculation Date. Each Applicable Percentage shall be effective from one
Calculation Date until the next Calculation Date.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Bankruptcy Event" means, with respect to any Person, the occurrence of
any of the following with respect to such Person: (i) a court or governmental
agency having jurisdiction in the premises shall enter a decree or order for
relief in respect of such
6
8
Person in an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or ordering the winding
up or liquidation of its affairs; or (ii) there shall be commenced against such
Person an involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or any case, proceeding or other action
for the appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part of
its Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed, undischarged or unbonded for a period of sixty (60) consecutive
days; or (iii) such Person shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under any
such law, or consent to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or make any general
assignment for the benefit of creditors; or (iv) such Person shall be unable to,
or shall admit in writing its inability to, pay its debts generally as they
become due.
"Base Rate" means the rate of interest established from time to time
and announced by Lender as its "base rate," such rate being an interest rate
used as an index for establishing interest rates on loans.
"Borrower" means Tractor Supply Company, a Delaware corporation,
together with any permitted successors and assigns.
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in Nashville, Tennessee are authorized or required by
law to close, except that, so long as the Adjusted Eurodollar Rate is the
interest rate applied hereunder and pursuant to the Note, such day shall also be
a day on which dealings between banks are carried on in U.S. dollar deposits in
London, England.
"Capital Lease" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
7
9
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. dollar denominated
time deposits and certificates of deposit of (i) Lender, (ii) any domestic
commercial bank of recognized standing having capital and surplus in excess of
$500,000,000 or (iii) any bank whose short-term commercial paper rating from S&P
is at least A-1 or the equivalent thereof or from Moody's is at least P-1 or the
equivalent thereof (any such bank being an "Approved Bank"), in each case with
maturities of not more than 270 days from the date of acquisition, (c)
commercial paper and variable or fixed rate notes issued by any Approved Bank
(or by the parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation rated A-1 (or the equivalent thereof) or
better by S&P or P-1 (or the equivalent thereof) or better by Moody's and
maturing within six months of the date of acquisition, (d) repurchase agreements
entered into by any Person with a bank or trust company or recognized securities
dealer having capital and surplus in excess of $500,000,000 for direct
obligations issued by or fully guaranteed by the United States of America in
which such Person shall have a perfected first priority security interest
(subject to no other Liens) and having, on the date of purchase thereof, a fair
market value of at least 100% of the amount of the repurchase obligations and
(e) Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of 1940,
as amended, which are administered by reputable financial institutions having
capital of at least $500,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing subdivisions (a) through
(d).
"Change of Control" means the occurrence of any of the following
events: (i) any Person or two or more Persons acting in concert shall have
acquired "beneficial ownership," directly or indirectly, of, or shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their acquisition of,
control over, Voting Stock of the Borrower (or other securities convertible into
such Voting Stock) representing 25% or more of the combined voting power of all
Voting Stock of the Borrower, or (ii) during any period of up to 24 consecutive
months, commencing after the Closing Date, individuals who at the beginning of
such 24 month period were directors of the Borrower (together with any new
director whose election by the Borrower's Board of Directors or whose nomination
for election by the Borrower's shareholders was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
directors of the Borrower then in office. As used herein, "beneficial ownership"
shall have the meaning provided in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Act of 1934.
"Closing Date" means the date hereof.
8
10
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. References to sections
of the Code shall be construed also to refer to any successor sections.
"Consolidated Capital Expenditures" means, for any period, all capital
expenditures of the Consolidated Parties on a consolidated basis for such
period, as determined in accordance with GAAP.
"Consolidated EBITDA" means, for any period, the sum of (a)
Consolidated Net Income for such period, plus (b) an amount which, in the
determination of Consolidated Net Income for such period, has been deducted for
(i) Consolidated Interest Expense, (ii) total federal, state, local and foreign
income, value added and similar taxes and (iii) depreciation and amortization
expense.
"Consolidated EBITR" means, for any period, the sum of (a) Consolidated
Net Income for such period, plus (b) an amount which, in the determination of
Consolidated Net Income for such period, has been deducted for (i) Consolidated
Interest Expense, (ii) total federal, state, local and foreign income, value
added and similar taxes and (iii) Consolidated Rental Expense for such period.
"Consolidated Interest Expense" means, for any period, all interest
expense (including the interest component under Capital Leases and Synthetic
Leases) of the Consolidated Parties on a consolidated basis for such period, as
determined in accordance with GAAP (except with respect to the interest
component under Synthetic Leases).
"Consolidated Parties" means a collective reference to the Borrower and
its Subsidiaries, and "Consolidated Party" means any one of them.
"Consolidated Net Income" means, for any period, net income (excluding
extraordinary items) after taxes for such period of the Consolidated Parties on
a consolidated basis, as determined in accordance with GAAP.
"Consolidated Rental Expense" means, for any period, rental expense
under Operating Leases (excluding any Synthetic Lease) of the Consolidated
Parties on a consolidated basis for such period, as determined in accordance
with GAAP.
"Consolidated Revenues" means, as of the end of any fiscal quarter of
the Consolidated Parties for the twelve month period ending on such date,
revenues of the Consolidated Parties on a consolidated basis, as determined in
accordance with GAAP.
"Credit Documents" means a collective reference to this Credit
Agreement, the Note, each Joinder Agreement, and all other related agreements
and documents issued or delivered hereunder or thereunder or pursuant hereto or
thereto (in each case as the same may be amended, modified, restated,
supplemented, extended, renewed or replaced from time to time), and "Credit
Document" means any one of them.
9
11
"Credit Parties" means a collective reference to the Borrower and the
Guarantors, and "Credit Party" means any one of them.
"Credit Party Obligation" means, without duplication, (i) all of the
obligations of the Credit Parties to the Lender, whenever arising, under this
Credit Agreement, the Note or any of the other Credit Documents (including, but
not limited to, any interest accruing after the occurrence of a Bankruptcy Event
with respect to any Credit Party, regardless of whether such interest is an
allowed claim under the Bankruptcy Code) and (ii) all liabilities and
obligations, whenever arising, owing from the Borrower to Lender, or any
Affiliate of Lender, arising under any Hedging Agreement relating to the Credit
Party Obligations.
"Current Assets" means, as of any date, the total amount of current
assets of the Consolidated Parties on a consolidated basis, as determined in
accordance with GAAP.
"Current Liabilities" means, as of any date, the total amount of
current liabilities of the Consolidated Parties on a consolidated basis, as
determined in accordance with GAAP.
"Current Ratio" means, at any time, the ratio of (a) Current Assets to
(b) the sum of (i) Current Liabilities plus (ii) the aggregate principal amount
of the Revolving Obligations outstanding as such term is defined in the
Syndicated Agreement.
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Dollars" and "$" means dollars in lawful currency of the United States
of America.
"Domestic Subsidiary" means, with respect to any Person, any Subsidiary
of such Person which is incorporated or organized under the laws of any State of
the United States or the District of Columbia.
"Eligible Assignee" means (i) an Affiliate of Lender; and (ii) any
other Person approved by the Lender and, unless an Event of Default has occurred
and is continuing at the time any assignment is effected in accordance with
Section 10.3, the Borrower (such approval not to be unreasonably withheld or
delayed by the Borrower and such approval to be deemed given by the Borrower if
no objection is received by the assigning Lender and the Lender from the
Borrower within two Business Days after notice of such proposed assignment has
been provided by the assigning Lender to the Borrower); provided, however, that
neither the Borrower nor an Affiliate of the Borrower shall qualify as an
Eligible Assignee.
"Environmental Laws" means any and all lawful and applicable Federal,
state, local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to the environment or to
emissions, discharges,
10
12
releases or threatened releases of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes.
"Equity Issuance" means any issuance by any Consolidated Party to any
Person which is not a Credit Party of (a) shares of its Capital Stock, (b) any
shares of its Capital Stock pursuant to the exercise of options or warrants or
(c) any shares of its Capital Stock pursuant to the conversion of any debt
securities to equity.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity which is under common control with
any Consolidated Party within the meaning of Section 4001(a)(14) of ERISA, or is
a member of a group which includes any Consolidated Party and which is treated
as a single employer under Sections 414(b) or (c) of the Code.
"ERISA Event" means (i) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the meaning
of Section 4062(e) of ERISA); (ii) the withdrawal by any Consolidated Party or
any ERISA Affiliate from a Multiple Employer Plan during a plan year in which it
was a substantial employer (as such term is defined in Section 4001(a)(2) of
ERISA), or the termination of a Multiple Employer Plan; (iii) the distribution
of a notice of intent to terminate or the actual termination of a Plan pursuant
to Section 4041 (a)(2) or 4041A of ERISA; (iv) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under Section 4042 of
ERISA; (v) any event or condition which might constitute grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; (vi) the complete or partial withdrawal of any
Consolidated Party or any ERISA Affiliate from a Multiemployer Plan; (vii) the
conditions for imposition of a lien under Section 302(f) of ERISA exist with
respect to any Plan; or (viii) the adoption of an amendment to any Plan
requiring the provision of security to such Plan pursuant to Section 307 of
ERISA.
"Eurodollar Rate" means the rate per annum determined by the Lender to
be equal to the quotient obtained by dividing (a) the 30-Day Interbank Offered
Rate by (b) 1 minus the Eurodollar Reserve Requirement. The Eurodollar Rate
shall be determined on the first Business Day of each month during the term of
the Loan and shall remain fixed until the first Business Day of the following
month.
"Eurodollar Reserve Requirement" means, at any time, the maximum rate
at which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time
11
13
to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against "Eurodollar
liabilities" (as such term is used in Regulation D). Without limiting the effect
of the foregoing, the Eurodollar Reserve Requirement shall reflect any other
reserves required to be maintained by such member banks with respect to any
category of liabilities which includes deposits by reference to which the
Adjusted Eurodollar Rate is to be determined.
"Event of Default" shall have the meaning as defined in Section 9.1.
"Fixed Charge Coverage Ratio" means, with respect to the Consolidated
Parties on a consolidated basis, the ratio of (a) Consolidated EBITR for the
prior twelve month period to (b) the sum of (i) Consolidated Interest Expense
for the prior twelve month period plus (ii) Scheduled Funded Debt Payments for
the prior twelve month period plus (iii) Consolidated Rental Expense for the
prior twelve month period.
"Foreign Subsidiary" means, with respect to any Person, any Subsidiary
of such Person which is not a Domestic Subsidiary of such Person.
"Funded Indebtedness" means, with respect to any Person, without
duplication, (a) all Indebtedness of such Person other than Indebtedness of the
types referred to in clause (e), (f), (g), (i), and (1) of the definition of
"Indebtedness" set forth in this Section 1.1, (b) all Indebtedness of another
Person of the type referred to in clause (a) above secured by (or for which the
holder of such Funded Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (c) all Guaranty Obligations of
such Person with respect to Indebtedness of the type referred to in clause (a)
above of another Person and (d) Indebtedness of the type referred to in clause
(a) above of any partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.3.
"Governmental Authority" means any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guarantors" means a collective reference to each of the Subsidiary
Guarantors and "Guarantor" means any one of them.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (a) to purchase any such Indebtedness or
any Property constituting security therefor, (b) to
12
14
advance or provide funds or other support for the payment or purchase of any
such Indebtedness or to maintain working capital, solvency or other balance
sheet condition of such other Person (including without limitation keep well
agreements, maintenance agreements, comfort letters or similar agreements or
arrangements) for the benefit of any holder of Indebtedness of such other
Person, (c) to lease or purchase Property, securities or services primarily for
the purpose of assuring the holder of such Indebtedness, or (d) to otherwise
assure or hold harmless the holder of such Indebtedness against loss in respect
thereof. The amount of any Guaranty Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount equal to the
outstanding principal amount (or maximum principal amount, if larger) of the
Indebtedness in respect of which such Guaranty Obligation is made.
"Hedging Agreements" means any interest rate protection agreement or
foreign currency exchange agreement.
"Indebtedness" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
Property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or assumed as the
deferred purchase price of Property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (e) all obligations of such Person under take-or-pay or
similar arrangements or under commodities agreements, (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, Property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (g) all
Guaranty Obligations of such Person, (h) the principal portion of all
obligations of such Person under Capital Leases, (i) all obligations of such
Person under Hedging Agreements, (j) the maximum amount of all standby letters
of credit issued or bankers' acceptances facilities created for the account of
such Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (k) the principal portion of all obligations of such Person under
Synthetic Leases and (l) the Indebtedness of any partnership or unincorporated
joint venture in which such Person is a general partner or a joint venturer.
"Interest Period" means any period during the Term of the Loan
beginning on the first Business Day of each month and ending on the day
immediately preceding the first Business Day of the following month.
"Investment" means (a) the acquisition (whether for cash, property,
services, assumption of Indebtedness, securities or otherwise) of assets,
Capital Stock, bonds, notes, debentures, partnership, joint ventures or other
ownership interests or other securities of any Person or (b) any deposit with,
or advance, loan or other extension of
13
15
credit to, any Person (other than deposits made in connection with the purchase
of equipment or other assets in the ordinary course of business) or (c) any
other capital contribution to or investment in any Person, including, without
limitation, any Guaranty Obligations (including any support for a letter of
credit issued on behalf of such Person) incurred for the benefit of such Person.
"Joinder Agreement" means a Joinder Agreement substantially in the form
of Exhibit 7.12 hereto, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 7.12.
"Lender" means SunTrust Bank, a Georgia state banking corporation,
together with its successors and permitted assigns.
"Leverage Ratio" means, with respect to the Consolidated Parties on a
consolidated basis for the twelve month period ending on the last day of any
fiscal quarter, the ratio of (a) the sum of (i) Funded Indebtedness on the last
day of such period plus (ii) Consolidated Rental Expense for such period
multiplied by six to (b) the sum of (i) Consolidated EBITDA for such period plus
(ii) Consolidated Rental Expense for such period.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the Uniform Commercial Code
as adopted and in effect in the relevant jurisdiction or other similar recording
or notice statute, and any lease in the nature thereof).
"Loan" means the credit facility by Borrower to Lender contemplated by
this Agreement.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, assets, property, condition (financial or otherwise),
liabilities or prospects of the Borrower and its Subsidiaries taken as a whole,
(b) the ability of any Credit Party to perform any material obligation under the
Credit Documents to which it is a party or (c) the material rights and remedies
of the Lender under the Credit Documents.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Laws, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" means November 1, 2003, as such date may be extended
pursuant to Section 2.2.
14
16
"Moody's" means Moody's Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Sections 3(37) or 4001 (a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any Consolidated Party or
any ERISA Affiliate and at least one employer other than the Consolidated
Parties or any ERISA Affiliate are contributing sponsors.
"Net Cash Proceeds" means the aggregate cash proceeds received by the
Consolidated Parties in respect of any Equity Issuance, net of (a) direct costs
(including, without limitation, legal, accounting and investment banking fees,
and sales commissions) and (b) taxes paid or payable as a result thereof; it
being understood that "Net Cash Proceeds" shall include, without limitation, any
cash received upon the sale or other disposition of any non-cash consideration
received by the Consolidated Parties in any Equity Issuance.
"Net Worth" means, as of any date with respect to the Consolidated
Parties on a consolidated basis, shareholder's equity or net worth, as
determined in accordance with GAAP.
"Note" means the Amended and Restated Term Note of the Borrower
executed of even date herewith, payable to the order of Lender and evidencing
the Loan, as amended and supplemented from time to time, and any replacement or
substitution thereof.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any Property (whether real, personal or mixed) which is not a
Capital Lease other than any such lease in which that Person is the lessor.
"Other Taxes" shall have the meaning assigned to such term in Section
3.4.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Investments" means Investments which are either (i) cash and
Cash Equivalents; (ii) accounts receivable created, acquired or made by any
Consolidated Party in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; (iii) Investments
consisting of Capital Stock, obligations, securities or other property received
by any Consolidated Party in settlement of accounts receivable (created in the
ordinary course of business) from bankrupt obligors; and (iv) investments in any
Credit Party.
"Permitted Liens" means:
15
17
(i) Liens (other than Liens created or imposed
under ERISA) for taxes, assessments or governmental charges or
levies not yet due or Liens for taxes being contested in good
faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and
as to which the Property subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof);
(ii) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and suppliers
and other Liens imposed by law or pursuant to customary
reservations or retentions of title arising in the ordinary
course of business, provide that such Liens secure only
amounts not yet due and payable or, if due and payable, are
unfiled and no other action has been taken to enforce the same
or are being contested in good faith by appropriate
proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which
the Property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof);
(iii) Liens (other than Liens created or imposed
under ERISA) incurred or deposits made by any Consolidated
Party in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types
of social security, or to secure the performance of tenders,
statutory obligations, bids, leases, government contracts,
performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of
borrowed money);
(iv) Liens in connection with attachments or
judgments (including judgment or appeal bonds) provided that
the judgments secured shall, within 30 days after the entry
thereof, have been discharged or execution thereof stayed
pending appeal, or shall have been discharged within 30 days
after the expiration of any such stay;
(v) easements, rights-of-way, restrictions
(including zoning restrictions), minor defects or
irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use
of the encumbered Property for its intended purposes;
(vi) Liens on Property securing purchase money
Indebtedness (including Capital Leases and Synthetic Leases)
to the extent permitted under Section 8.1(b), provided that
any such Lien attaches to such Property concurrently with or
within 90 days after the acquisition thereof,
(vii) leases or subleases granted to others not
interfering in any material respect with the business of any
Consolidated Party;
16
18
(viii) any interest of title of a lessor under, and
Liens arising from UCC financing statements (or equivalent
filings, registrations or agreements in foreign jurisdictions)
relating to, leases permitted by this Credit Agreement;
(ix) normal and customary rights of setoff upon
deposits of cash in favor of banks or other depository
institutions;
(x) Liens of a collecting bank arising under
Section 4-210 of the Uniform Commercial Code on items in the
course of collection; and
(xi) Liens existing as of the Closing Date and
set forth on Schedule 1.1; provided that (a) no such Lien
shall at any time be extended to or cover any Property other
than the Property subject thereto on the Closing Date and (b)
the principal amount of the Indebtedness secured by such Liens
shall not be extended, renewed, refunded or refinanced.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, business trust, association, trust or
other enterprise (whether or not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which any Consolidated
Party or any ERISA Affiliate is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" within the
meaning of Section 3(5) of ERISA.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Regulation T, U, or X" means Regulation T, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing into
the environment (including the abandonment or discarding of barrels, containers
and other closed receptacles) of any Materials of Environmental Concern.
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the notice requirement has been
waived by regulation.
"Requirement of Law" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other
17
19
Governmental Authority, in each case applicable to or binding upon such Person
or to which any of its material property is subject.
"Restricted Payment" means (i) any dividend or other payment or
distribution, direct or indirect, on account of any shares of any class of
Capital Stock of any Consolidated Party, now or hereafter outstanding (including
without limitation any payment in connection with any merger or consolidation
involving any Consolidated Party), or to the direct or indirect holders of any
shares of any class of Capital Stock of any Consolidated Party, now or hereafter
outstanding, in their capacity as such (other than dividends or distributions
payable in the same class of Capital Stock of the applicable Person or to any
Credit Party (directly or indirectly through Subsidiaries), (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Capital Stock of any
Consolidated Party, now or hereafter outstanding and (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of Capital Stock of any Consolidated
Party, now or hereafter outstanding.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"Scheduled Funded Debt Payments" means, as of the end of each fiscal
quarter of the Borrower, for the Borrower and its Subsidiaries on a consolidated
basis, the sum of all scheduled payments of principal on Funded Indebtedness for
the applicable period ending on such date (including the principal component of
payments due on Capital Leases during the applicable period ending on such
date); it being understood that Scheduled Funded Debt Payments shall not include
voluntary prepayments.
"Single Employer Plan" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"Solvent" or "Solvency" means, with respect to any Person as of a
particular date, that on such date (i) such Person is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (ii) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature in their ordinary course, (iii) such Person is not engaged in a business
or a transaction, and is not about to engage in a business or a transaction, for
which such Person's Property would constitute unreasonably small capital after
giving due consideration to the prevailing practice in the industry in which
such Person is engaged or is to engage, (iv) the fair value of the Property of
such Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (v) the present fair
salable value of the assets of such Person is not less than the amount that will
be required to pay the probable liability of such Person on its debts as they
become absolute and matured. In computing the amount of contingent liabilities
at any time, it is intended that such liabilities will be
18
20
computed at the amount which, in light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"Subsidiary" means, as to any Person at any time, (a) any corporation
more than 50% of whose Capital Stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at such time, any class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency) is at such time owned by such Person directly or
indirectly through Subsidiaries, and (b) any partnership, association, joint
venture or other entity of which such Person directly or indirectly through
Subsidiaries owns at such time more than 50% of the Capital Stock.
"Subsidiary Guarantor" means each of the Persons identified as a
"Subsidiary Guarantor" on the signature pages hereto and each Additional Credit
Party which may hereafter execute a Joinder Agreement, together with their
successors and permitted assigns, and "Subsidiary Guarantor" means any one of
them.
"Syndicated Agreement" means that certain Credit Agreement dated as of
November 3, 2000 entered into by and among Borrower, Guarantors, Bank of
America, N.A., as Administrative Agent, Banc of America Securities, LLC, as Lead
Arranger and Book Manager, Firstar Bank, National Association, SouthTrust Bank,
AmSouth Bank, Compass Bank, and Lender, as such may be amended from time to
time.
"Synthetic Lease" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an Operating Lease.
"Taxes" shall have the meaning assigned to such term in Section 3.4.
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"Wholly Owned Subsidiary" of any Person means any Subsidiary 100% of
whose Voting Stock or other equity interest is at the time owned by such Person
directly or indirectly through another Wholly Owned Subsidiary.
1.2 COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
19
21
1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lender shall
be prepared, in accordance with GAAP applied on a consistent basis. All
calculations made for the purposes of determining compliance with this Credit
Agreement shall (except as otherwise expressly provided herein) be made by
application of GAAP applied on a basis consistent with the most recent annual or
quarterly financial statements delivered pursuant to Section 7.1 (or, prior to
the delivery of the first financial statements pursuant to Section 7.1,
consistent with the financial statements as at January 1, 2000); provided,
however, if (a) the Credit Parties shall object to determining such compliance
on such basis at the time of delivery of such financial statements due to any
change in GAAP or the rules promulgated with respect thereto or (b) the Lender
shall so object in writing within 60 days after delivery of such financial
statements, then such calculations shall be made on a basis consistent with the
most recent financial statements delivered by the Credit Parties to the Lender
as to which no such objection shall have been made.
SECTION 2.
THE LOAN
2.1 THE LOAN.
(a) Subject to the terms and conditions of and relying on the
representations, warranties and covenants contained in this Agreement,
the Lender agrees to make available to the Borrower a term loan of Nine
Million Nine Hundred Ninety-Nine Thousand Nine Hundred Forty-Five and
No/100 Dollars ($9,999,945.00).
(b) The Loan shall be evidenced by the Note and shall be
payable in accordance with its terms. Interest shall accrue at the
Adjusted Eurodollar Rate as set forth in the Note.
20
22
2.2 EXTENSION OPTION.
The Borrower may, by notice to the Lender, given not more than 90 days
and not less than 45 days prior to the first anniversary of the Closing Date
request that the Lender extend the Maturity Date for an additional 364 days from
the existing Maturity Date. Lender shall, by notice to the Borrower given not
later than the 30th day prior to the first anniversary of the Closing Date,
advise the Borrower whether or not it agrees, at its sole and absolute
discretion, to extend the Maturity Date for an additional 364 days. If the
Lender timely agrees in writing to extend the existing Maturity Date for an
additional 364 day period, then the Maturity Date shall be extended to the date
364 days from the existing Maturity Date pursuant to a duly executed written
amendment to this Credit Agreement.
SECTION 3.
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 DEFAULT RATE.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loan and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
Base Rate.
3.2 PREPAYMENTS.
The Borrower shall have the right to prepay the Loan in whole or in
part from time to time without premium or penalty; provided, however, that each
partial prepayment of the Loan shall be in a minimum principal amount of
$1,000,000 and integral multiples of $100,000. Any prepayment hereunder shall be
applied as follows: first, to the payment of any fees owed to Lender; second, to
any accrued interest under the Note; and third, to the payment of the
outstanding principal of the Loan in inverse order of maturity.
3.3 CAPITAL ADEQUACY.
If the Lender has determined, after the date hereof, that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by Lender with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on Lender's capital or assets as a consequence of its commitments or obligations
hereunder to a level below that which Lender could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Lender's policies with respect to capital adequacy), then, upon notice from such
Lender
21
23
to the Borrower, the Borrower shall be obligated to pay to such Lender such
additional amount or amounts as will compensate such Lender for such reduction.
Each determination by any such Lender of amounts owing under this Section shall,
absent manifest error, be conclusive and binding on the parties hereto.
3.4 CONVERSION OPTION.
If on or prior to the first Business Day of any month during the term
of the Loan, the Lender determines that by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period then the Lender shall give the Borrower
prompt notice thereof, and so long as such condition remains in effect, the
Lenders shall have the option to convert the interest rate applied pursuant to
the Note from the Adjusted Eurodollar Rate to the Base Rate, such conversion
becoming effective on the first day of such Interest Period. If for any reason
whatsoever, a conversion occurs pursuant to this Section 3.4 on a day which is
not the last day of the then current Interest Period, the Borrower shall
compensate Lender for any loss resulting therefrom.
3.5 ILLEGALITY.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for Lender to apply the
Adjusted Eurodollar Rate as contemplated in the Note, (a) Lender shall promptly
give written notice of such circumstances to the Borrower (which notice shall be
withdrawn whenever such circumstances no longer exist), and (b) the interest
rate applied under the Note shall be converted automatically to the Base Rate on
the last day of the then current Interest Period or within such earlier period
as required by law. If for any reason whatsoever, a conversion occurs pursuant
to this Section 3.5 on a day which is not the last day of the then current
Interest Period, the Borrower shall compensate Lender for any loss resulting
therefrom.
3.6 REQUIREMENTS OF LAW.
If, after the date hereof, the adoption of any applicable law, rule, or
regulation, or any change in any applicable law, rule, or regulation, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by Lender with any request or directive
(whether or not having the force of law) of any such Governmental Authority,
central bank, or comparable agency:
(i) shall subject Lender to any tax, duty, or other
charge with respect to the Loan or the Note, or change the
basis of taxation of any amounts payable to Lender under this
Credit Agreement or the Note (other than taxes imposed on the
overall net income of Lender by the jurisdiction in which such
Lender has its principal office);
22
24
(ii) shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar requirement
(other than the Eurodollar Reserve Requirement utilized in the
determination of the Adjusted Eurodollar Rate) relating to any
extensions of credit or other assets of, or any deposits with
or other liabilities or commitments of, Lender; or
(iii) shall impose on Lender or the London interbank
market any other condition affecting this Credit Agreement or
the Note;
and the result of any of the foregoing is to increase the cost to Lender of
continuing or maintaining the Loan or to reduce any sum received or receivable
by Lender under this Credit Agreement or the Note, then the Borrower shall pay
to Lender on demand such amount or amounts as will compensate Lender for such
increased cost or reduction. Lender shall promptly notify the Borrower of any
event of which it has knowledge, occurring after the date hereof, which will
entitle Lender to compensation pursuant to this Section 3.6. If Lender claims
compensation under this Section 3.6, Lender shall furnish to the Borrower a
statement setting forth the additional amount or amounts to be paid to it
hereunder which shall be conclusive in the absence of manifest error. In
determining such amount, Lender may use any reasonable averaging and attribution
methods.
3.7 TAXES.
(a) Any and all payments by any Credit Party to or for the
account of Lender shall be made free and clear of and without deduction
for any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding taxes imposed on its income, and franchise taxes
imposed on it, by the jurisdiction under the laws of which the Lender
is organized or any political subdivision thereof (all such
non-excluded taxes, duties, levies, imposts, deductions, charges,
withholdings, and liabilities being hereinafter referred to as
"Taxes"). If any Credit Party shall be required by law to deduct any
Taxes from or in respect of any sum payable under this Credit Agreement
or any other Credit Document to Lender, (i) 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 3.4) the Lender receives an amount equal to the sum it would
have received had no such deductions been made, (ii) such Credit Party
shall make such deductions, (iii) such Credit Party shall pay the full
amount deducted to the relevant taxation authority or other authority
in accordance with applicable law, and (iv) such Credit Party shall
furnish to the Lender, at its address referred to in Section 10.1, the
original or a certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all
present or future stamp or documentary taxes and any other excise or
property taxes or charges or similar levies which arise from any
payment made under this Credit Agreement or any other Credit Document
or from the execution or delivery of, or
23
25
otherwise with respect to, this Credit Agreement or any other Credit
Document (hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify the Lender for the full
amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts
payable under this Section 3.4) paid by the Lender (as the case may be)
and any liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto.
(d) Within thirty (30) days after the date of any payment of
Taxes, the applicable Credit Party shall furnish to the Lender the
original or a certified copy of a receipt evidencing such payment.
(e) Without prejudice to the survival of any other agreement
of the Credit Parties hereunder, the agreements and obligations of the
Credit Parties contained in this Section 3.7 shall survive the
repayment of the Loan and other obligations under the Credit Documents.
3.8 PAYMENTS, COMPUTATIONS, ETC.
(a) Except as otherwise specifically provided herein, all
payments hereunder shall be made to the Lender in Dollars in
immediately available funds, without setoff, deduction, counterclaim or
withholding of any kind, at the Lender's office specified in Section
10.1 not later than 2:00 p.m. (Nashville, Tennessee time) on the date
when due. Payments received after such time shall be deemed to have
been received on the next succeeding Business Day. The Lender may (but
shall not be obligated to) debit the amount of any such payment which
is not made by such time to any ordinary deposit account of the
Borrower or any other Credit Party maintained with the Lender (with
notice to the Borrower or such other Credit Party). Whenever any
payment hereunder shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next
succeeding Business Day (subject to accrual of interest and Fees for
the period of such extension), if the extension would cause the payment
to be made in the next following calendar month, then such payment
shall instead be made on the next preceding Business Day. Except as
expressly provided otherwise herein, all computations of interest and
fees shall be made on the basis of actual number of days elapsed over a
year of 360 days. Interest shall accrue from and include the date of
borrowing, but exclude the date of payment.
(b) Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement to the
contrary, after the occurrence and during the continuance of an Event
of Default, all amounts collected or received by the Lender on account
of the Credit Party Obligations or any other amounts outstanding under
any of the Credit Documents or in respect of the Collateral shall be
paid over or delivered as follows:
24
26
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Lender in connection with enforcing the rights of the Lenders
under the Credit Documents;
SECOND, to payment of any fees owed to the Lender;
THIRD, to the payment of all of the Credit Party Obligations
consisting of accrued fees and interest;
FOURTH, to the payment of the outstanding principal amount of
the Credit Party Obligations;
FIFTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FOURTH" above; and
SIXTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, amounts received shall be applied in the
numerical order provided until exhausted prior to application to the
next succeeding category.
SECTION 4.
GUARANTY
4.1 THE GUARANTY.
Each of the Guarantors hereby jointly and severally guarantees to the
Lender, each Affiliate of Lender that enters into a Hedging Agreement, the
prompt payment of the Credit Party Obligations in full when due (whether at
stated maturity, by acceleration, or otherwise) strictly in accordance with the
terms thereof. The Guarantors hereby further agree that if any of the Credit
Party Obligations are not paid in full when due (whether at stated maturity, by
acceleration, or otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Credit Party
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration, or otherwise) in accordance with the terms
of such extension or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents or Hedging Agreements, the obligations of each
Guarantor hereunder shall be limited to an aggregate amount equal to the largest
amount that would not render its obligations hereunder subject to avoidance
under Section 548 of the Bankruptcy Code or any comparable provisions of any
applicable state law.
25
27
4.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.1 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or Hedging
Agreements, or any other agreement or instrument referred to therein, or any
substitution, release, impairment or exchange of any other guarantee of or
security for any of the Credit Party Obligations, and, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor, it being the intent of this Section 4.2 that the
obligations of the Guarantors hereunder shall be absolute and unconditional
under any and all circumstances. Each Guarantor agrees that such Guarantor shall
have no right of subrogation, indemnity, reimbursement or contribution against
the Borrower or any other Guarantor for amounts paid under this Section 4 until
such time as the Lender (and any Affiliates of Lenders entering into Hedging
Agreements) has been paid in full and no Person or Governmental Authority shall
have any right to request any return or reimbursement of funds from the Lender
in connection with monies received under the Credit Documents or Hedging
Agreements. Without limiting the generality of the foregoing, it is agreed that,
to the fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder
which shall remain absolute and unconditional as described above:
(a) at any time or from time to time, without notice to any
Guarantor, the time for any performance of or compliance with any of
the Credit Party Obligations shall be extended, or such performance or
compliance shall be waived;
(b) any of the acts mentioned in any of the provisions of any
of the Credit Documents, any Hedging Agreement or any other agreement
or instrument referred to in the Credit Documents or Hedging Agreements
shall be done or omitted;
(c) the maturity of any of the Credit Party Obligations shall
be accelerated, or any of the Credit Party Obligations shall be
modified, supplemented or amended in any respect, or any right under
any of the Credit Documents, any Hedging Agreement or any other
agreement or instrument referred to in the Credit Documents or Hedging
Agreements shall be waived or any other guarantee of any of the Credit
Party Obligations or any security therefor shall be released, impaired
or exchanged in whole or in part or otherwise dealt with;
(d) any Lien granted to, or in favor of, the Lender as
security for any of the Credit Party Obligations shall fail to attach
or be perfected; or
(e) any of the Credit Party Obligations shall be determined to
be void or voidable (including, without limitation, for the benefit of
any creditor of any
26
28
Guarantor) or shall be subordinated to the claims of any Person
(including, without limitation, any creditor of any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Lender exhaust any right, power or
remedy or proceed against any Person under any of the Credit Documents, any
Hedging Agreement or any other agreement or instrument referred to in the Credit
Documents or Hedging Agreements, or against any other Person under any other
guarantee of, or security for, any of the Credit Party Obligations.
4.3 REINSTATEMENT.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Lender on demand for all reasonable costs and expenses (including, without
limitation, fees and expenses of counsel) incurred by the Lender in connection
with such rescission or restoration, including any such costs and expenses
incurred in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.
4.4 CERTAIN ADDITIONAL WAIVERS.
Each Guarantor agrees that such Guarantor shall have no right of
recourse to security for the Credit Party Obligations, except through the
exercise of rights of subrogation pursuant to Section 4.2 and through the
exercise of rights of contribution pursuant to Section 4.6.
4.5 REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Lender, on the other hand, the
Credit Party Obligations may be declared to be forthwith due and payable as
provided in Section 9.2 (and shall be deemed to have become automatically due
and payable in the circumstances provided in said Section 9.2) for purposes of
Section 4.1 notwithstanding any stay, injunction or other prohibition preventing
such declaration (or preventing the Credit Party Obligations from becoming
automatically due and payable) as against any other Person and that, in the
event of such declaration (or the Credit Party Obligations being deemed to have
become automatically due and payable), the Credit Party Obligations (whether or
not due and payable by any other Person) shall forthwith become due and payable
by the Guarantors for purposes of Section 4.1.
27
29
4.6 RIGHTS OF CONTRIBUTION.
The Guarantors hereby agree as among themselves that, if any Guarantor
shall make an Excess Payment (as defined below), such Guarantor shall have a
right of contribution from each other Guarantor in an amount equal to such other
Guarantor's Contribution Share (as defined below) of such Excess Payment. The
payment obligations of any Guarantor under this Section 4.6 shall be subordinate
and subject in right of payment to the prior payment in full to the Lender and
the Lenders of the Guaranteed Obligations, and none of the Guarantors shall
exercise any right or remedy under this Section 4.6 against any other Guarantor
until payment and satisfaction in full of all of such Guaranteed Obligations.
For purposes of this Section 4.6, (a) "Guaranteed Obligation" shall mean any
obligations arising under the other provisions of this Section 4; (b) "Excess
Payment" shall mean the amount paid by any Guarantor in excess of its Pro Rata
Share of any Guaranteed Obligations; (c) "Pro Rata Share" shall mean, for any
Guarantor in respect of any payment of Guaranteed Obligations, the ratio
(expressed as a percentage) as of the date of such payment of Guaranteed
Obligations of (i) the amount by which the aggregate present fair salable value
of all of its assets and properties exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair salable value
of all assets and other properties of all of the Credit Parties exceeds the
amount of all of the debts and liabilities (including contingent, subordinated,
unmatured, and unliquidated liabilities, but excluding the obligations of the
Credit Parties hereunder) of the Credit Parties; provided, however, that, for
purposes of calculating the Pro Rata Shares of the Guarantors in respect of any
payment of Guaranteed Obligations, any Guarantor that became a Guarantor
subsequent to the date of any such payment shall be deemed to have been a
Guarantor on the date of such payment and the financial information for such
Guarantor as of the date such Guarantor became a Guarantor shall be utilized for
such Guarantor in connection with such payment; and (d) "Contribution Share"
shall mean, for any Guarantor in respect of any Excess Payment made by any other
Guarantor, the ratio (expressed as a percentage) as of the date of such Excess
Payment of (i) the amount by which the aggregate present fair salable value of
all of its assets and properties exceeds the amount of all debts and liabilities
of such Guarantor (including contingent, subordinated, unmatured, and
unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair salable value
of all assets and other properties of the Credit Parties other than the maker of
such Excess Payment exceeds the amount of all of the debts and liabilities
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of the Credit Parties) of the Credit Parties other
than the maker of such Excess Payment; provided, however, that, for purposes of
calculating the Contribution Shares of the Guarantors in respect of any Excess
Payment, any Guarantor that became a Guarantor subsequent to the date of any
such Excess Payment shall be deemed to have been a Guarantor on the date of such
Excess Payment and the financial information for such Guarantor as of the date
such Guarantor became a Guarantor shall be utilized for such Guarantor in
connection with
28
30
such Excess Payment. This Section 4.6 shall not be deemed to affect any right of
subrogation, indemnity, reimbursement or contribution that any Guarantor may
have under applicable law against the Borrower in respect of any payment of
Guaranteed Obligations.
4.7 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee in this Section 4 is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Credit Party
Obligations whenever arising.
SECTION 5.
CONDITIONS
5.1 CLOSING CONDITIONS.
The obligation of the Lender to enter into this Credit Agreement and to
make the Loan shall be subject to satisfaction of the following conditions (in
form and substance acceptable to the Lenders):
(a) Executed Credit Documents. Receipt by the Lender of duly
executed copies of (i) this Credit Agreement, (ii) the Note and (iii)
all other Credit Documents, each in form and substance acceptable to
the Lender in its sole discretion.
(b) Corporate Documents. Receipt by the Lender of the
following:
(i) Charter Documents. Copies of the articles or
certificates of incorporation or other charter documents of
each Credit Party certified to be true and complete as of a
recent date by the appropriate Governmental Authority of the
state or other jurisdiction of its incorporation and certified
by a secretary or assistant secretary of such Credit Party to
be true and correct as of the Closing Date.
(ii) Bylaws. A copy of the bylaws of each Credit
Party certified by a secretary or assistant secretary of such
Credit Party to be true and correct as of the Closing Date.
(iii) Good Standing. Copies of certificates of good
standing, existence or its equivalent with respect to each
Credit Party certified as of a recent date by the appropriate
Governmental Authorities of the state or other jurisdiction of
incorporation and Tennessee and each other jurisdiction in
which the failure to so qualify and be in good standing could
have a Material Adverse Effect.
29
31
(iv) Incumbency. An incumbency certificate of each
Credit Party certified by a secretary or assistant secretary
to be true and correct as of the Closing Date.
(c) Financial Statements. Receipt by the Lender of (i) the
consolidated and consolidating financial statements of the Borrower and
its Subsidiaries, including balance sheets and income and cash flow
statements for the fiscal year 1999 and audited by nationally
recognized independent public accountants and containing an unqualified
opinion of such firm that such statements present fairly the
consolidated and consolidating financial position of the Borrower and
its Subsidiaries and are prepared in conformity with GAAP and (ii) such
other information relating to the Borrower and its Subsidiaries as the
Lender may reasonably require in connection with the structuring and
syndication of credit facilities of the type described herein.
(d) Lien Searches. The Lender shall have received with respect
to the Borrower searches of Uniform Commercial Code filings in
Delaware, Tennessee and Texas, copies of the financing statements on
file in such jurisdictions and evidence that no Liens exist other than
Permitted Liens.
(e) Evidence of Insurance. Receipt by the Lender of copies of
insurance policies or certificates of insurance of the Consolidated
Parties evidencing liability and casualty insurance meeting the
requirements set forth in the Credit Documents.
(f) Material Adverse Effect. No material adverse change shall
have occurred since January 1, 2000 in the condition (financial or
otherwise), business, assets, liabilities, operations, management or
prospects of the Consolidated Parties taken as a whole.
(g) Litigation. There shall not exist any pending or
threatened action, suit, investigation or proceeding against a
Consolidated Party that could have a Material Adverse Effect.
(h) Officer's Certificates. The Lender shall have received a
certificate or certificates executed by the chief financial officer of
the Borrower as of the Closing Date stating that (i) each Credit Party
is in compliance with all existing financial obligations, (ii) all
governmental, shareholder and third party consents and approvals, if
any, with respect to the Credit Documents and the transactions
contemplated thereby have been obtained, (iii) no action, suit,
investigation or proceeding is pending or threatened in any court or
before any arbitrator or governmental instrumentality that purports to
affect any Credit Party or any transaction contemplated by the Credit
Documents, if such action, suit, investigation or proceeding could have
a Material Adverse Effect, and (iv) immediately after giving effect to
this Credit Agreement, the other Credit Documents and all the
transactions contemplated therein to occur on such date, (A) each of
the Credit Parties is Solvent, (B) no Default or Event of Default
30
32
exists, (C) all representations and warranties contained herein and in
the other Credit Documents are true and correct in all material
respects, and (D) the Credit Parties are in compliance with each of the
financial covenants set forth in Section 7.11.
(i) Fees and Expenses. Payment by the Credit Parties of all
fees and expenses owed by them to the Lender, including, without
limitation, reasonable attorney fees.
(j) Other. Receipt by the Lender of such other documents,
instruments, agreements or information as reasonably requested by
Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities
(actual or contingent), real estate leases, material contracts, debt
agreements, property ownership and contingent liabilities of the
Consolidated Parties.
SECTION 6.
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Lender that:
6.1 FINANCIAL CONDITION.
The financial statements delivered to the Lender pursuant to Section
5.1(c) and Section 7.1 (a) and (b), (i) have been prepared in accordance with
GAAP and (ii) present fairly (on the basis disclosed in the footnotes to such
financial statements) the consolidated and consolidating financial condition,
results of operations and cash flows of the Consolidated Parties as of such date
and for such periods.
6.2 NO MATERIAL CHANGE.
Since January 1, 2000, (a) there has been no development or event
relating to or affecting a Consolidated Party which has had or could reasonably
be expected to have a Material Adverse Effect and (b) except as otherwise
permitted under this Credit Agreement, no dividends or other distributions have
been declared, paid or made upon the Capital Stock in a Consolidated Party nor
has any of the Capital Stock in a Consolidated Party been redeemed, retired,
purchased or otherwise acquired for value.
6.3 ORGANIZATION AND GOOD STANDING; COMPLIANCE WITH LAW.
Each of the Consolidated Parties (a) is duly organized, validly
existing and is in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the requisite power and authority to own
and operate all its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, and (c) is duly qualified
to conduct business and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification except to the extent that the failure
31
33
to so qualify or be in good standing could not reasonably be expected to have a
Material Adverse Effect.
6.4 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
Each of the Credit Parties has the corporate or other necessary power
and authority, to make, deliver and perform the Credit Documents to which it is
a party, and in the case of the Borrower, to obtain extensions of credit
hereunder, and has taken all necessary corporate action to authorize the
borrowings and other extensions of credit on the terms and conditions of this
Credit Agreement and to authorize the execution, delivery and performance of the
Credit Documents to which it is a party. No consent or authorization of, filing
with, notice to or other similar act by or in respect of, any Governmental
Authority or any other Person is required to be obtained or made by or on behalf
of any Credit Party in connection with the borrowings or other extensions of
credit hereunder or with the execution, delivery, performance, validity or
enforceability of the Credit Documents to which such Credit Party is a party.
This Credit Agreement has been, and each other Credit Document to which any
Credit Party is a party will be, duly executed and delivered on behalf of the
Credit Parties. This Credit Agreement constitutes, and each other Credit
Document to which any Credit Party is a party when executed and delivered will
constitute, a legal, valid and binding obligation of such Credit Party
enforceable against such party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
6.5 NO CONFLICTS.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will (a)
violate or conflict with any provision of its articles or certificate of
incorporation or bylaws or other organizational or governing documents of such
Person, (b) violate, contravene or materially conflict with any Requirement of
Law or any other law, regulation (including, without limitation, Regulation U or
Regulation X), order, writ, judgment, injunction, decree or permit applicable to
it, (c) violate, contravene or conflict with contractual provisions of, or cause
an event of default under, any indenture, loan agreement, mortgage, deed of
trust, contract or other agreement or instrument to which it is a party or by
which it may be bound, the violation of which could have a Material Adverse
Effect, or (d) result in or require the creation of any Lien upon or with
respect to its properties. No Default or Event of Default has occurred and is
continuing.
32
34
6.6 OWNERSHIP.
Each Consolidated Party is the owner of, and has good and marketable
title to, all of its respective assets and none of such assets is subject to any
Lien other than Permitted Liens.
6.7 INDEBTEDNESS.
Except as otherwise permitted under Section 8.1, the Consolidated
Parties have no Indebtedness.
6.8 LITIGATION.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Credit Party,
threatened against any Consolidated Party which could reasonably be expected to
have a Material Adverse Effect.
6.9 TAXES.
Each Consolidated Party has filed, or caused to be filed, all tax
returns (federal, state, local and foreign) required to be filed and paid (a)
all amounts of taxes shown thereon to be due (including interest and penalties)
and (b) all other taxes, fees, assessments and other governmental charges
(including mortgage recording taxes, documentary stamp taxes and intangibles
taxes) owing by it, except for such taxes (i) which are not yet delinquent or
(ii) that are being contested in good faith and by proper proceedings, and
against which adequate reserves are being maintained in accordance with GAAP. No
Credit Party is aware as of the Closing Date of any proposed tax assessments
against it or any Consolidated Party.
6.10 COMPLIANCE WITH LAW.
Each Consolidated Party is in compliance with all Requirements of Law
and all other laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless
such failure to comply could not have a Material Adverse Effect.
6.11 ERISA.
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no ERISA Event has
occurred, and, to the best knowledge of the Credit Parties, no event or
condition has occurred or exists as a result of which any ERISA Event
could reasonably be expected to occur, with respect to any Plan; (ii)
no "accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, has
occurred with respect to any Plan; (iii) each Plan has been maintained,
operated, and funded in compliance with its own terms and in material
compliance with the provisions of ERISA, the Code, and any other
33
35
applicable federal or state laws; and (iv) no lien in favor of the PBGC
or a Plan has arisen or is reasonably likely to arise on account of any
Plan.
(b) The actuarial present value of all "benefit liabilities"
(as defined in Section 4001(a)(16) of ERISA), whether or not vested,
under each Single Employer Plan, as of the last annual valuation date
prior to the date on which this representation is made or deemed made
(determined, in each case, in accordance with Financial Accounting
Standards Board Statement 87, utilizing the actuarial assumptions used
in such Plan's most recent actuarial valuation report), did not exceed
as of such valuation date the fair market value of the assets of such
Plan.
(c) Neither any Consolidated Party nor any ERISA Affiliate has
incurred, or, to the best knowledge of the Credit Parties, could be
reasonably expected to incur, any withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. Neither any
Consolidated Party nor any ERISA Affiliate would become subject to any
withdrawal liability under ERISA if any Consolidated Party or any ERISA
Affiliate were to withdraw completely from all Multiemployer Plans and
Multiple Employer Plans as of the valuation date most closely preceding
the date on which this representation is made or deemed made. Neither
any Consolidated Party nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization (within
the meaning of Section 4241 of ERISA), is insolvent (within the meaning
of Section 4245 of ERISA), or has been terminated (within the meaning
of Title IV of ERISA), and no Multiemployer Plan is, to the best
knowledge of the Credit Parties, reasonably expected to be in
reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject any Consolidated Party or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which any Consolidated Party or any ERISA Affiliate has
agreed or is required to indemnify any Person against any such
liability.
(e) Neither any Consolidated Party nor any ERISA Affiliates
has any material liability with respect to "expected post-retirement
benefit obligations" within the meaning of the Financial Accounting
Standards Board Statement 106. Each Plan which is a welfare plan (as
defined in Section 3(1) of ERISA) to which Sections 601-609 of ERISA
and Section 4980B of the Code apply has been administered in compliance
in all material respects of such sections.
(f) Neither the execution and delivery of this Credit
Agreement nor the consummation of the financing transactions
contemplated thereunder will involve any transaction which is subject
to the prohibitions of Sections 404, 406 or 407 of ERISA or in
connection with which a tax could be imposed pursuant to
34
36
Section 4975 of the Code. The representation by the Credit Parties in
the preceding sentence is made in reliance upon and subject to the
accuracy of the Lender's representation in Section 10.15 with respect
to their source of funds and is subject, in the event that the source
of the funds used by the Lender in connection with this transaction is
an insurance company's general asset account, to the application of
Prohibited Transaction Class Exemption 95-60, 60 Fed. Reg. 35,925
(1995), compliance with the regulations issued under Section
401(c)(1)(A) of ERISA, or the issuance of any other prohibited
transaction exemption or similar relief, to the effect that assets in
an insurance company's general asset account do not constitute assets
of an "employee benefit plan" within the meaning of Section 3(3) of
ERISA of a "plan" within the meaning of Section 4975(e)(1) of the Code.
6.12 SUBSIDIARIES.
Set forth on Schedule 6.12 is a complete and accurate list of all
Subsidiaries of each Consolidated Party. Information on Schedule 6.12 includes
jurisdiction of incorporation, the number of shares of each class of Capital
Stock outstanding, the number and percentage of outstanding shares of each class
owned (directly or indirectly) by such Credit Party; and the number and effect,
if exercised, of all outstanding options, warrants, rights of conversion or
purchase and all other similar rights with respect thereto. The outstanding
Capital Stock of all such Subsidiaries is validly issued, fully paid and
non-assessable and is owned by each such Consolidated Party, directly or
indirectly, free and clear of all Liens. Other than as set forth in Schedule
6.12, no Consolidated Party has outstanding any securities convertible into or
exchangeable for its Capital Stock nor does any such Person have outstanding any
rights to subscribe for or to purchase or any options for the purchase of, or
any agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to its Capital Stock.
Schedule 6.12 may be updated from time to time by the Borrower by giving written
notice thereof to the Lender.
6.13 GOVERNMENTAL REGULATIONS, ETC.
(a) No part of the proceeds of the Loan will be used, directly
or indirectly, for the purpose of purchasing or carrying any "margin
stock" within the meaning of Regulation U, or for the purpose of
purchasing or carrying or trading in any securities that are "margin
stock" within the meaning of Regulation U. If requested by Lender, the
Borrower will furnish to the Lender a statement to the foregoing effect
in conformity with the requirements of FR Form U-1 referred to in
Regulation U. No indebtedness being reduced or retired out of the
proceeds of the Loan was or will be incurred for the purpose of
purchasing or carrying any margin stock within the meaning of
Regulation U or any "margin security" within the meaning of Regulation
T. "Margin stock" within the meaning of Regulation U does not
constitute more than 25% of the value of the consolidated assets of the
Consolidated Parties. None of the transactions contemplated by this
Credit Agreement (including, without
35
37
limitation, the direct or indirect use of the proceeds of the Loan)
will violate or result in a violation of the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended, or
regulations issued pursuant thereto, or Regulation T, U or X.
(b) No Consolidated Party is subject to regulation under the
Public Utility Holding Company Act of 1935, the Federal Power Act or
the Investment Company Act of 1940, each as amended. In addition, no
Consolidated Party is (i) an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as
amended, and is not controlled by such a company, or (ii) a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary" of a "holding
company", within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
(c) No director, executive officer or principal shareholder of
any Consolidated Party is a director, executive officer or principal
shareholder of Lender. For the purposes hereof the terms "director",
"executive officer" and "principal shareholder" (when used with
reference to Lender) have the respective meanings assigned thereto in
Regulation O issued by the Board of Governors of the Federal Reserve
System.
(d) Each Consolidated Party has obtained and holds in full
force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of
way and other rights, consents and approvals which are necessary for
the ownership of its respective Property and to the conduct of its
respective businesses as presently conducted.
(e) No Consolidated Party is in violation of any applicable
statute, regulation or ordinance of the United States of America, or of
any state, city, town, municipality, county or any other jurisdiction,
or of any agency thereof (including without limitation, environmental
laws and regulations), which violation could have a Material Adverse
Effect.
(f) Each Consolidated Party is current with all material
reports and documents, if any, required to be filed with any state or
federal securities commission or similar securities agency and is in
full compliance in all material respects with all applicable rules and
regulations of such commissions.
6.14 PURPOSE OF LOAN.
The proceeds of the Loan were used for general business purposes.
6.15 ENVIRONMENTAL MATTERS.
Except as would not have or be reasonably expected to have a Material
Adverse Effect:
36
38
(a) Each of the facilities and properties owned, leased or
operated by the Consolidated Parties (the "Properties") and all
operations at the Properties are in compliance with all applicable
Environmental Laws, and there is no violation of any Environmental Law
with respect to the Properties or the businesses operated by the
Consolidated Parties (the "Businesses"), and there are no conditions
relating to the Businesses or Properties that could give rise to
liability under any applicable Environmental Laws.
(b) None of the Properties contains, or has previously
contained, any Materials of Environmental Concern at, on or under the
Properties in amounts or concentrations that constitute or constituted
a violation of, or could give rise to liability under, Environmental
Laws.
(c) No Consolidated Party has received any written or verbal
notice of, or inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the
Businesses, nor does any Consolidated Party have knowledge or reason to
believe that any such notice will be received or is being threatened.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties, or generated, treated,
stored or disposed of at, on or under any of the Properties or any
other location, in each case by or on behalf of any Consolidated Party
in violation of, or in a manner that could give rise to liability
under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative
action is pending or, to the best knowledge of any Credit Party,
threatened, under any Environmental Law to which any Consolidated Party
is or will be named as a party, nor are there any consent decrees or
other decrees, consent orders, administrative orders or other orders,
or other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Consolidated Parties, the
Properties or the Businesses.
(f) There has been no release, or threat of release, of
Materials of Environmental Concern at or from the Properties, or
arising from or related to the operations (including, without
limitation, disposal) of any Consolidated Party in connection with the
Properties or otherwise in connection with the Businesses, in violation
of or in amounts or in a manner that could give rise to liability under
Environmental Laws.
6.16 INTELLECTUAL PROPERTY.
Each Consolidated Party owns, or has the legal right to use, all
trademarks, tradenames, copyrights, technology, know-how and processes (the
"Intellectual Property") necessary for each of them to conduct its business as
currently conducted except for those the failure to own or have such legal fight
to use could not have a
37
39
Material Adverse Effect. No claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does any Credit
Party know of any such claim, and to the Credit Parties' knowledge the use of
such Intellectual Property by any Consolidated Party does not infringe on the
fights of any Person, except for such claims and infringements that, in the
aggregate, could not have a Material Adverse Effect.
6.17 SOLVENCY.
Each Consolidated Party is and, after consummation of the transactions
contemplated by this Credit Agreement, will be Solvent.
6.18 INVESTMENTS.
All Investments of each Consolidated Party are Permitted Investments.
6.19 LOCATION OF ASSETS.
Set forth on Schedule 6.19 is the chief executive office and principal
place of business of each Consolidated Party.
6.20 DISCLOSURE.
Neither this Credit Agreement nor any financial statements delivered to
the Lender nor any other document, certificate or statement famished to the
Lender by or on behalf of any Consolidated Party in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.
6.21 NO BURDENSOME RESTRICTIONS.
No Consolidated Party is a party to any agreement or instrument or
subject to any other obligation or any charter or corporate restriction or any
provision of any applicable law, rule or regulation which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
6.22 BROKERS' FEES.
None of the Borrower or any of its Subsidiaries has any obligation to
any Person in respect of any finder's, broker's, investment banking or other
similar fee in connection with any of the transactions contemplated under the
Credit Documents.
6.23 LABOR MATTERS.
(a) Except as set forth on Schedule 6.23, there are no collective
bargaining agreements or Multiemployer Plans covering the employees of a
Consolidated Party,
38
40
and (b) none of the Consolidated Parties (i) has suffered any strikes, walkouts,
work stoppages or other material labor difficulty within the last five years, or
(ii) has knowledge of any potential or pending strike, walkout or work stoppage.
SECTION 7.
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding:
7.1 FINANCIAL STATEMENTS.
The Credit Parties will furnish, or cause to be furnished, to the
Lender:
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Consolidated Parties, the consolidated and consolidating balance sheet
and income statement of the Consolidated Parties, as of the end of such
fiscal year, together with related consolidated and consolidating
statements of operations and retained earnings and of cash flows for
such fiscal year, setting forth in comparative form consolidated and
consolidating figures for the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and
audited by independent certified public accountants of recognized
national standing reasonably acceptable to the Lender and whose opinion
shall be to the effect that such financial statements have been
prepared in accordance with GAAP (except for changes with which such
accountants concur) and shall not be limited as to the scope of the
audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of
the Consolidated Parties (other than the fourth fiscal quarter, in
which case 90 days after the end thereof) a consolidated and
consolidating balance sheet and income statement of the Consolidated
Parties, as of the end of such fiscal quarter, together with related
consolidated and consolidating statements of operations and retained
earnings and of cash flows for such fiscal quarter, in each case
setting forth in comparative form consolidated and consolidating
figures for the corresponding period of the preceding fiscal year, all
such financial information described above to be in reasonable form and
detail and reasonably acceptable to the Lender, and accompanied by a
certificate of the chief financial officer of the Borrower to the
effect that such quarterly financial statements fairly present in all
material respects the financial condition of the Consolidated Parties
and have been prepared in accordance with GAAP, subject to changes
resulting from audit and normal year-end audit adjustments.
39
41
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b) above,
a certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.11 by
calculation thereof as of the end of each such fiscal period and (ii)
stating that no Default or Event of Default exists, or if any Default
or Event of Default does exist, specifying the nature and extent
thereof and what action the Credit Parties propose to take with respect
thereto.
(d) Annual Budget. At least 10 days prior to the end of each
fiscal year of the Borrower, beginning with the fiscal year ending
December 30, 2000, a budget of the Consolidated Parties containing,
among other things, pro forma financial statements for the next fiscal
year.
(e) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Credit Agreement and stating further whether,
in the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(f) Auditor's Report. Promptly upon receipt thereof, a copy of
any other report or "management letter" submitted by independent
accountants to any Consolidated Party in connection with any annual,
interim or special audit of the books of such Person.
(g) Reports. Promptly upon transmission or receipt thereof,
(i) copies of any filings and registrations with, and reports to or
from, the Securities and Exchange Commission, or any successor agency,
and copies of all financial statements, proxy statements, notices and
reports as any Consolidated Party shall send to its shareholders or to
a holder of any Indebtedness owed by any Consolidated Party in its
capacity as such a holder and (ii) upon the request of the Lender, all
reports and written information to and from the United States
Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(h) Notices. Upon obtaining knowledge thereof, the Credit
Parties will give written notice to the Lender immediately of (i) the
occurrence of an event or condition consisting of a Default or Event of
Default, specifying the nature and existence thereof and what action
the Credit Parties propose to take with respect thereto, and (ii) the
occurrence of any of the following with respect to any Consolidated
Party (A) the pendency or commencement of any litigation, arbitral or
governmental proceeding against such Person which if adversely
determined is likely to have a Material Adverse Effect, (B) the
institution of any proceedings
40
42
against such Person with respect to, or the receipt of notice by such
Person of potential liability or responsibility for violation, or
alleged violation of any federal, state or local law, rule or
regulation, including but not limited to, Environmental Laws, the
violation of which could reasonably be expected to have a Material
Adverse Effect, or (C) any notice or determination concerning the
imposition of any withdrawal liability by a Multiemployer Plan against
such Person or any ERISA Affiliate, the determination that a
Multiemployer Plan is, or is expected to be, in reorganization within
the meaning of Title IV of ERISA or the termination of any Plan.
(i) ERISA. Upon obtaining knowledge thereof, the Credit
Parties will give written notice to the Lender promptly (and in any
event within five business days) of. (i) of any event or condition,
including, but not limited to, any Reportable Event, that constitutes,
or might reasonably lead to, an ERISA Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against the Credit
Parties or any ERISA Affiliates, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment
on or before the due date (including extensions) thereof of all amounts
which any Consolidated Party or any ERISA Affiliate is required to
contribute to each Plan pursuant to its terms and as required to meet
the minimum funding standard set forth in ERISA and the Code with
respect thereto; or (iv) any change in the funding status of any Plan
that could have a Material Adverse Effect, together with a description
of any such event or condition or a copy of any such notice and a
statement by the chief financial officer of the Borrower briefly
setting forth the details regarding such event, condition, or notice,
and the action, if any, which has been or is being taken or is proposed
to be taken by the Credit Parties with respect thereto. Promptly upon
request, the Credit Parties shall furnish the Lender with such
additional information concerning any Plan as may be reasonably
requested, including, but not limited to, copies of each annual
report/return (Form 5500 series), as well as all schedules and
attachments thereto required to be filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA and the Code,
respectively, for each "plan year" (within the meaning of Section 3(39)
of ERISA).
(j) Other Information. With reasonable promptness upon any
such request, such other information regarding the business, properties
or financial condition of any Consolidated Party as the Lender may
reasonably request.
7.2 PRESERVATION OF EXISTENCE AND FRANCHISES.
Each Credit Party will, and will cause each of its Subsidiaries to, do
all things necessary to preserve and keep in full force and effect its
existence, rights, franchises and authority.
41
43
7.3 BOOKS AND RECORDS.
Each Credit Party will, and will cause each of its Subsidiaries to,
keep complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the establishment
and maintenance of appropriate reserves).
7.4 COMPLIANCE WITH LAW.
Each Credit Party will, and will cause each of its Subsidiaries to,
comply with all laws, rules, regulations and orders, and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and its
Property if noncompliance with any such law, rule, regulation, order or
restriction could have a Material Adverse Effect.
7.5 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Each Credit Party will, and will cause each of its Subsidiaries to, pay
and discharge (a) all taxes, assessments and governmental charges or levies
imposed upon it, or upon its income or profits, or upon any of its properties,
before they shall become delinquent, (b) all lawful claims (including claims for
labor, materials and supplies) which, if unpaid, might give rise to a Lien upon
any of its properties, and (c) except as prohibited hereunder, all of its other
Indebtedness as it shall become due; provided, however, that no Consolidated
Party shall be required to pay any such tax, assessment, charge, levy, claim or
Indebtedness which is being contested in good faith by appropriate proceedings
and as to which adequate reserves therefor have been established in accordance
with GAAP, unless the failure to make any such payment (i) could give rise to an
immediate right to foreclose on a Lien securing such amounts or (ii) could have
a Material Adverse Effect.
7.6 INSURANCE.
Each Credit Party will, and will cause each of its Subsidiaries to, at
all times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities and
with such deductibles or self-insurance retentions as are in accordance with
normal industry practice. The present insurance coverage of the Consolidated
Parties is outlined as to carrier, policy number, expiration date, type and
amount on Schedule 7.6.
7.7 MAINTENANCE OF PROPERTY.
Each Credit Party will, and will cause each of its Subsidiaries to,
maintain and preserve its properties and equipment material to the conduct of
its business in good repair, working order and condition, normal wear and tear
and casualty and condemnation excepted, and will make, or cause to be made, in
such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions,
42
44
betterments and improvements thereto as may be needed or proper, to the extent
and in the manner customary for companies in similar businesses.
7.8 PERFORMANCE OF OBLIGATIONS.
Each Credit Party will, and will cause each of its Subsidiaries to,
perform in all material respects all of its obligations under the terms of all
material agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
7.9 USE OF PROCEEDS.
The Borrower will use the proceeds of the Loan solely for the purposes
set forth in Section 6.14.
7.10 AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, each Credit
Party will, and will cause each of its Subsidiaries to, permit representatives
appointed by the Lender, including, without limitation, independent accountants,
agents, attorneys, and appraisers to visit and inspect its property, including
its books and records, its accounts receivable and inventory, its facilities and
its other business assets, and to make photocopies or photographs thereof and to
write down and record any information such representative obtains and shall
permit the Lender or its representatives to investigate and verify the accuracy
of information provided to the Lender and to discuss all such matters with the
officers, employees and representatives of such Person.
7.11 FINANCIAL COVENANTS.
(a) Current Ratio. At all times the Current Ratio shall be
greater than or equal to 1.1 to 1.0.
(b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio, as of the last day of each fiscal quarter of the Borrower, shall
be greater than or equal to 1.35 to 1.0;
(c) Leverage Ratio. The Leverage Ratio, as of the last day of
each fiscal quarter of the Borrower, shall be less than or equal to
4.25 to 1.0; except that the Leverage Ratio, as of the last day of the
fiscal quarters of the Borrower ending September 30, 2000, March 31,
2001, September 30, 2001 and March 31, 2002 shall be less than or equal
to 4.50 to 1.0;
(d) Net Worth. Net Worth shall at all times be greater than or
equal to $133,200,000, increased on a cumulative basis as of the end of
each fiscal quarter of the Borrower, commencing with the fiscal quarter
ending September 30, 2000 by an amount equal to 50% of Consolidated Net
Income for the fiscal quarter then ended (without deductions for any
losses) plus 100% of the Net Cash Proceeds from any Equity Issuance
subsequent to the Closing Date.
43
45
7.12 ADDITIONAL CREDIT PARTIES.
As soon as practicable and in any event within 30 days after any Person
becomes a Subsidiary of any Credit Party, the Borrower shall provide the Lender
with written notice thereof setting forth information in reasonable detail
describing all of the assets of such Person and shall if such Person is a
Domestic Subsidiary of a Credit Party, cause such Person to execute a Joinder
Agreement in substantially the same form as Exhibit 7.12 and cause such Person
to deliver such other documentation as the Lender may reasonably request in
connection with the foregoing, including, without limitation, certified
resolutions and other organizational and authorizing documents of such Person,
and favorable opinions of counsel to such Person all in form, content and scope
reasonably satisfactory to the Lender.
7.13 ENVIRONMENTAL LAWS.
(a) The Consolidated Parties shall comply in all material
respects with, and take reasonable actions to ensure compliance in all
material respects by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply in all material
respects with and maintain, and take reasonable actions to ensure that
all tenants and subtenants obtain and comply in all material respects
with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws
except to the extent that failure to do so would not reasonably be
expected to have a Material Adverse Effect;
(b) The Consolidated Parties shall conduct and complete all
investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws and
promptly comply in all material respects with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws
except to the extent that the same are being contested in good faith by
appropriate proceedings and the failure to do or the pendency of such
proceedings would not reasonably be expected to have a Material Adverse
Effect; and
(c) The Consolidated Parties shall defend, indemnify and hold
harmless the Lender, and its respective employees, agents, officers and
directors, from and against any and all claims, demands, penalties,
fines, liabilities, settlements, damages, costs and expenses of
whatever kind or nature known or unknown, contingent or otherwise,
arising out of, or in any way relating to the violation of,
noncompliance with or liability under, any Environmental Law applicable
to the operations of the Borrower or any of its Subsidiaries or the
Properties, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorney's and consultant's fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the
extent that any of the foregoing arise out of the gross negligence or
willful misconduct of the party seeking
44
46
indemnification therefor. The agreements in this paragraph shall
survive repayment of the Loan and all other amounts payable hereunder.
SECTION 8.
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding:
8.1 INDEBTEDNESS.
The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the
other Credit Documents;
(b) purchase money Indebtedness (including obligations in
respect of Capital Leases) hereafter incurred by the Borrower to
finance the purchase of fixed assets provided that (i) the total of all
such Indebtedness shall not exceed an aggregate principal amount of
$5,000,000 at any one time outstanding; (ii) such Indebtedness when
incurred shall not exceed the purchase price of the asset(s) financed;
and (iii) no such Indebtedness shall be refinanced for a principal
amount in excess of the principal balance outstanding thereon at the
time of such refinancing;
(c) Indebtedness of the Borrower set forth in Schedule 8.1
(but not including any renewals, refinancings or extensions thereof);
(d) obligations of the Borrower in respect of Hedging Agreements
entered into in order to manage existing or anticipated interest rate
or exchange rate risks and not for speculative purposes;
(e) intercompany Indebtedness arising out of loans, advances
and Guaranty Obligations permitted under Section 8.6;
(f) Indebtedness of the Borrower and its Subsidiaries in
respect of Synthetic Leases, provided that such Indebtedness shall not
exceed an aggregate principal amount of $30,000,000 at any one time
outstanding; and
(g) other unsecured Indebtedness of the Borrower and its
Subsidiaries in an amount not to exceed $5,000,000 in the aggregate at
any one time.
45
47
8.2 LIENS.
The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Lien with respect to any of its
Property, whether now owned or after acquired, except for Permitted Liens.
8.3 NATURE OF BUSINESS.
The Credit Parties will not permit any Consolidated Party to
substantively alter the character or conduct of the business conducted by such
Person as of the Closing Date.
8.4 CONSOLIDATION, MERGER, DISSOLUTION, ETC.
The Credit Parties will not permit any Consolidated Party to enter into
any transaction of merger or consolidation or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution); provided that,
notwithstanding the foregoing provisions of this Section 8.4, (a) the Borrower
may merge or consolidate with any of its Subsidiaries provided that (i) the
Borrower shall be the continuing or surviving corporation and (ii) after giving
effect to such transaction, no Default or Event of Default exists, (b) any
Credit Party other than the Borrower may merge or consolidate with any other
Credit Party other than the Borrower provided that after giving effect to such
transaction, no Default or Event of Default exists, (c) any Consolidated Party
which is not a Credit Party may be merged or consolidated with or into any
Credit Party provided that (i) such Credit Party shall be the continuing or
surviving corporation and (ii) after giving effect to such transaction, no
Default or Event of Default exists, and (d) any Consolidated Party which is not
a Credit Party may be merged or consolidated with or into any other Consolidated
Party which is not a Credit Party provided that, after giving effect to such
transaction, no Default or Event of Default exists.
8.5 ASSET DISPOSITIONS.
The Credit Parties will not permit any Consolidated Party to sell,
lease, transfer or otherwise dispose of any Property other than (a) the sale of
inventory in the ordinary course of business for fair consideration, (b) the
sale or disposition of machinery and equipment no longer used or useful in the
conduct of such Person's business, (c) the sale, lease, transfer or other
disposition of Property to any Credit Party in the ordinary course of business
and (d) other sales of assets of the Consolidated Parties, including
transactions of the type described in Section 8.13, having a net book value not
to exceed $ 10,000,000 in the aggregate during the term of this Credit
Agreement.
8.6 INVESTMENTS.
The Credit Parties will not permit any Consolidated Party to make
Investments in or to any Person, except for Permitted Investments.
46
48
8.7 RESTRICTED PAYMENTS.
The Credit Parties will not permit any Consolidated Party to, directly
or indirectly, declare, order, make or set apart any sum for or pay any
Restricted Payment, except (a) to make dividends payable solely in the same
class of Capital Stock of such Person and (b) to make dividends or other
distributions payable to the Borrower (directly or indirectly through
Subsidiaries).
8.8 PREPAYMENTS OF INDEBTEDNESS, ETC.
The Credit Parties will not permit any Consolidated Party to (a) after
the issuance thereof, amend or modify (or permit the amendment or modification
of) any of the terms of any Indebtedness if such amendment or modification would
add or change any terms in a manner adverse to the issuer of such Indebtedness,
or shorten the final maturity or average life to maturity or require any payment
to be made sooner than originally scheduled or increase the interest rate
applicable thereto or change any subordination provision thereof, or (b) make
(or give any notice with respect thereto) any voluntary or optional payment or
prepayment or redemption or acquisition for value of (including without
limitation, by way of depositing money or securities with the trustee with
respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of any other Indebtedness.
8.9 TRANSACTIONS WITH AFFILIATES.
Except as set forth on Schedule 8.9, the Credit Parties will not permit
any Consolidated Party to enter into or permit to exist any transaction or
series of transactions with any officer, director, shareholder, Subsidiary or
Affiliate of such Person other than (a) normal compensation and reimbursement of
expenses of officers and directors and (b) except as otherwise specifically
limited in this Credit Agreement, other transactions which are entered into in
the ordinary course of such Person's business on terms and conditions
substantially as favorable to such Person as would be obtainable by it in a
comparable arms-length transaction with a Person other than an officer,
director, shareholder, Subsidiary or Affiliate.
8.10 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.
The Credit Parties will not permit any Consolidated Party to (a) change
its fiscal year or (b) amend, modify or change its articles of incorporation (or
corporate charter or other similar organizational document) or bylaws (or other
similar document) in a manner that would adversely affect the rights of the
Lender.
8.11 LIMITATION ON RESTRICTED ACTIONS.
The Credit Parties will not permit any Consolidated Party to, directly
or indirectly, create or otherwise cause or suffer to exist or become effective
any encumbrance or restriction on the ability of any such Person to (a) pay
dividends or make any other distributions to any Credit Party on its Capital
Stock or with respect to
47
49
any other interest or participation in, or measured by, its profits, (b) pay any
Indebtedness or other obligation owed to any Credit Party, (c) make loans or
advances to any Credit Party, (d) sell, lease or transfer any of its properties
or assets to any Credit Party, or (e) act as a Guarantor and pledge its assets
pursuant to the Credit Documents or any renewals, refinancings, exchanges,
refundings or extension thereof, except (in respect of any of the matters
referred to in clauses (a)-(d) above) for such encumbrances or restrictions
existing under or by reason of (i) this Credit Agreement and the other Credit
Documents, (ii) applicable law, (iii) any document or instrument governing
Indebtedness incurred pursuant to Section 8.1(b) or the Capital Leases described
on Schedule 8.1, provided that any such restriction contained therein relates
only to the asset or assets constructed or acquired in connection therewith,
(iv) any document or instrument governing Indebtedness incurred pursuant to
Section 8.1(f), provided that any such restriction contained therein relates
only to the asset or assets securing such Indebtedness, or (v) the Syndicated
Agreement.
8.12 OWNERSHIP OF SUBSIDIARIES.
Notwithstanding any other provisions of this Credit Agreement to the
contrary, the Credit Parties will not permit any Consolidated Party to (i)
permit any Person (other than the Borrower or any Wholly-Owned Subsidiary of the
Borrower) to own any Capital Stock of any Subsidiary of the Borrower, (ii)
permit any Subsidiary of the Borrower to issue Capital Stock (except to the
Borrower or to a Wholly-Owned Subsidiary of the Borrower), (iii) permit, create,
incur, assume or suffer to exist any Lien thereon, in each case except (A) to
qualify directors where required by applicable law or to satisfy other
requirements of applicable law with respect to the ownership of Capital Stock of
Foreign Subsidiaries or (B) for Permitted Liens and (iv) notwithstanding
anything to the contrary contained in clause (ii) above, permit any Subsidiary
of the Borrower to issue any shares of preferred Capital Stock.
8.13 SALE LEASEBACKS.
Except as permitted by clause (c) of Section 8.5, the Credit Parties
will not permit any Consolidated Party to, directly or indirectly, become or
remain liable as lessee or as guarantor or other surety with respect to any
lease, whether an Operating Lease or a Capital Lease, of any Property (whether
real, personal or mixed), whether now owned or hereafter acquired, (a) which
such Consolidated Party has sold or transferred or is to sell or transfer to a
Person which is not a Consolidated Party or (b) which such Consolidated Party
intends to use for substantially the same purpose as any other Property which
has been sold or is to be sold or transferred by such Consolidated Party to
another Person which is not a Consolidated Party in connection with such lease.
8.14 CAPITAL EXPENDITURES.
The Credit Parties will not permit Consolidated Capital Expenditures to
exceed (a) $30,000,000 for fiscal year 2000 and (b) $25,000,000 for any fiscal
year thereafter.
48
50
8.15 NO FURTHER NEGATIVE PLEDGES.
The Credit Parties will not permit any Consolidated Party to enter
into, assume or become subject to any agreement prohibiting or otherwise
restricting the creation or assumption of any Lien upon its properties or
assets, whether now owned or hereafter acquired, or requiring the grant of any
security for such obligation if security is given for some other obligation,
except (a) pursuant to this Credit Agreement and the other Credit Documents, (b)
pursuant to any document or instrument governing Indebtedness incurred pursuant
to Section 8.1(b) or the Capital Leases described on Schedule 8.1, provided that
any such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith, (c) any document or instrument
governing Indebtedness incurred pursuant to Section 8.1(f), provided that any
such restriction contained therein relates only to the asset or assets securing
such Indebtedness, and (d) the Syndicated Agreement.
SECTION 9.
EVENTS OF DEFAULT
9.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall
(i) default in the payment when due of any
principal due pursuant to the Loan or the Note, or
(ii) default, and such default shall continue for
three (3) or more Business Days, in the payment when due of
any interest on the Loan or the Note, or other amounts owing
hereunder, under any of the other Credit Documents or in
connection herewith or therewith; or
(b) Representations. Any representation, warranty or
statement made or deemed to be made by any Credit Party herein, in any
of the other Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which it was
deemed to have been made; or
(c) Covenants. Any Credit Party shall
(i) default in the due performance or observance
of any term, covenant or agreement contained in Sections 7.2,
7.4, 7.9, 7.11, 7.12 or 8.1 through 8.15, inclusive;
(ii) default in the due performance or observance
of any term, covenant or agreement contained in Sections
7.1(a), (b), (c) or (d) and such
49
51
default shall continue unremedied for a period of at least 5
days after the earlier of a responsible officer of a Credit
Party becoming aware of such default or notice thereof by the
Lender; or
(iii) default in the due performance or observance
by it of any term, covenant or agreement (other than those
referred to in subsections (a), (b), (c)(i) or (c)(ii) of this
Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30
days after the earlier of a responsible officer of a Credit
Party becoming aware of such default or notice thereof by the
Lender; or
(d) Other Credit Documents. (i) Any Credit Party shall
default in the due performance or observance of any term, covenant or
agreement in any of the other Credit Documents (subject to applicable
grace or cure periods, if any), or (ii) except as a result of or in
connection with a merger of a Subsidiary permitted under Section 8.4,
any Credit Document shall fail to be in full force and effect or to
give the Lender the rights, powers and privileges purported to be
created thereby, or any Credit Party shall so state in writing; or
(e) Guaranties. Except as the result of or in connection
with a merger of a Subsidiary permitted under Section 8.4, the guaranty
given by any Guarantor hereunder (including any Additional Credit
Party) or any provision thereof shall cease to be in full force and
effect, or any Guarantor (including any Additional Credit Party)
hereunder or any Person acting by or on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations under such guaranty, or
any Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed
pursuant to any guaranty; or
(f) Bankruptcy, etc. Any Bankruptcy Event shall occur
with respect to any Consolidated Party; or
(g) Defaults under Other Agreements.
(i) Any Consolidated Party shall default in the
performance or observance (beyond the applicable grace period
with respect thereto, if any) of any material obligation or
condition of any contract or lease material to the
Consolidated Parties, taken as a whole; or
(ii) With respect to any Indebtedness (other than
Indebtedness outstanding under this Credit Agreement) in
excess of $500,000 in the aggregate for the Consolidated
Parties taken as a whole, (A) any Consolidated Party shall (1)
default in any payment (beyond the applicable grace period
with respect thereto, if any) with respect to any such
Indebtedness, or (2) the occurrence and continuance of a
default in the observance or performance relating to such
Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto,
50
52
or any other event or condition shall occur or condition
exist, the effect of which default or other event or condition
is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders)
to cause (determined without regard to whether any notice or
lapse of time is required), any such Indebtedness to become
due prior to its stated maturity; or (B) any such Indebtedness
shall be declared due and payable, or required to be prepaid
other than by a regularly scheduled required prepayment, prior
to the stated maturity thereof, or
(h) Judgment. One or more judgments or decrees shall be
entered against one or more of the Consolidated Parties involving a
liability of $500,000 or more in the aggregate (to the extent not paid
or fully covered by insurance provided by a carrier who has
acknowledged coverage and has the ability to perform) and any such
judgments or decrees shall not have been vacated, discharged or stayed
or bonded pending appeal within 30 days from the entry thereof, or
(i) ERISA. Any of the following events or conditions, if
such event or condition could have a Material Adverse Effect: (i) any
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets
of any Consolidated Party or any ERISA Affiliate in favor of the PBGC
or a Plan; (ii) an ERISA Event shall occur with respect to a Single
Employer Plan, which is, in the reasonable opinion of the Lender,
likely to result in the termination of such Plan for purposes of Title
IV of ERISA; (iii) an ERISA Event shall occur with respect to a
Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Lender, likely to result in (A) the
termination of such Plan for purposes of Title IV of ERISA, or (B) any
Consolidated Party or any ERISA Affiliate incurring any liability in
connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency or (within the meaning
of Section 4245 of ERISA) such Plan; or (iv) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the
Code) or breach of fiduciary responsibility shall occur which may
subject any Consolidated Party or any ERISA Affiliate to any liability
under Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of
the Code, or under any agreement or other instrument pursuant to which
any Consolidated Party or any ERISA Affiliate has agreed or is required
to indemnify any person against any such liability;
(j) Ownership. There shall occur a Change of Control; or
(k) Syndicated Agreement. A default occurs under the
Syndicated Agreement.
51
53
9.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the Lender, or cured
to the satisfaction of the Lender, the Lender shall, by written notice to the
Credit Parties, take any of the following actions:
(a) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of the Loan and any and all other
indebtedness or obligations of any and every kind owing by the Credit
Parties to the Lender to be due whereupon the same shall be immediately
due and payable without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Credit Parties.
(b) Enforcement of Right. Enforce any and all rights and
interests created and existing under the Credit Documents including,
without limitation, all rights and remedies against a Guarantor and all
rights of set-off.
Section 10.
MISCELLANEOUS
10.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address, in the case of the Credit Parties and the
Lender, set forth below, or at such other address as such party may specify by
written notice to the other parties hereto:
if to any Credit Party:
Tractor Supply Company
320 Plus Park Blvd.
Nashville, Tennessee 37217
Attn: Chief Financial Officer
Telephone: (615) 366-4600
Telecopy:
if to the Lender:
SunTrust Bank
P.O. Box 305110
Nashville, Tennessee 37230-5110
Attn: Tracy Elliott and
Allen Oakley
Telephone: (615) 748-5115
(615) 748-5934
Telecopier: (615) 748-5117
52
54
10.2 RIGHT OF SET-OFF; ADJUSTMENTS.
Upon the occurrence and during the continuance of any Event of Default,
Lender (and each of its Affiliates) is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by Lender (or any of its
Affiliates) to or for the credit or the account of any Credit Party against any
and all of the obligations of such Person now or hereafter existing under this
Credit Agreement, under the Note, under any other Credit Document or otherwise,
irrespective of whether Lender shall have made any demand under hereunder or
thereunder and although such obligations may be unmatured. Lender agrees
promptly to notify any affected Credit Party after any such set-off and
application made by Lender; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of Lender under this Section 10.2 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) that Lender may have.
10.3 BENEFIT OF AGREEMENT.
(a) This Credit Agreement shall be binding upon and inure
to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided that none of the Credit Parties
may assign or transfer any of its interests and obligations without
prior written consent of the Lender; provided further that the rights
of Lender to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth in this
Section 10.3.
(b) Lender may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Credit
Agreement (including, without limitation, all or a portion of the Loan
and the Note); provided, however, that
(i) each such assignment shall be to an Eligible
Assignee;
(ii) except in the case of an assignment of all
of Lender's rights and obligations under this Credit
Agreement, any such partial assignment shall be in an amount
at least equal to $5,000,000 or an integral multiple of
$1,000,000 in excess thereof;
53
55
(iii) each such assignment by Lender shall be of a
constant, and not varying, percentage of all of its rights and
obligations under this Credit Agreement and the Note; and
(iv) the parties to such assignment shall execute
and deliver to the Lender for its acceptance an Assignment and
Acceptance in the form of Exhibit 10.3(b) hereto, together
with any Note subject to such assignment and a processing fee
of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the
extent of such assignment, have the obligations, rights, and benefits
of Lender hereunder and the Lender shall, to the extent of such
assignment, relinquish its rights and be released from its obligations
under this Credit Agreement. Upon the consummation of any assignment
pursuant to this Section 10.3(b), the assignor, the Lender and the
Credit Parties shall make appropriate arrangements so that, if
required, a new Note is issued to the assignor and the assignee. If the
assignee is not a United States person under Section 7701(a)(30) of the
Code, it shall deliver to the Credit Parties and the Lender
certification as to exemption from deduction or withholding of Taxes in
accordance with Section 3.4.
(c) The Lender shall maintain at its address referred to
in Section 10.1 a copy of each Assignment and Acceptance delivered to
and accepted by it.
(d) Upon its receipt of an Assignment and Acceptance
executed by the parties thereto, together with any Note subject to such
assignment and payment of the processing fee, the Lender shall, if such
Assignment and Acceptance has been completed and is in substantially
the form of Exhibit 10.3(b) hereto, accept such Assignment and
Acceptance and give prompt notice thereof to the parties thereto.
(e) Lender may sell participations to one or more Persons
in all or a portion of its rights, obligations or rights and
obligations under this Credit Agreement (including all or a portion of
its Loan); provided, however, that (i) Lender's obligations under this
Credit Agreement shall remain unchanged, (ii) Lender shall remain
solely responsible to the other parties hereto for the performance of
such obligations, (iii) the participant shall be entitled to the
benefit yield protection provisions contained in Sections 3.4 through
3.7 the right of set-off contained in Section 10.2, and (iv) the Credit
Parties shall continue to deal solely and directly with Lender in
connection with Lender's rights and obligations under this Credit
Agreement, and Lender shall retain the sole right to enforce the
obligations of the Credit Parties relating to the Credit Party
Obligations owing to Lender and to approve any amendment, modification,
or waiver of any provision of this Credit Agreement (other than
amendments, modifications, or waivers decreasing the amount of
principal of or the rate at which interest is payable on the Loan or
Note, extending any scheduled
54
56
principal payment date or date fixed for the payment of interest on the
Loan or Note).
(f) Notwithstanding any other provision set forth in this
Credit Agreement, Lender may at any time assign and pledge all or any
portion of the Loan and Note to any Federal Reserve Bank as collateral
security pursuant to Regulation A and any Operating Circular issued by
such Federal Reserve Bank. No such assignment shall release the Lender
from its obligations hereunder.
(g) Lender may furnish any information concerning the
Consolidated Parties in the possession of Lender from time to time to
assignees and participants (including prospective assignees and
participants), subject, however, to the provisions of Section 10.14
hereof.
10.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Lender in exercising any right,
power or privilege hereunder or under any other Credit Document and no course of
dealing between the Lender and any of the Credit Parties shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein are cumulative
and not exclusive of any rights or remedies which the Lender would otherwise
have. No notice to or demand on any Credit Party in any case shall entitle the
Credit Parties to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Lender to any other or
further action in any circumstances without notice or demand.
10.5 EXPENSES; INDEMNIFICATION.
(a) The Credit Parties jointly and severally agree to pay
on demand all costs and expenses of the Lender in connection with the
syndication, preparation, execution, delivery, administration,
modification, and amendment of this Credit Agreement, the other Credit
Documents, and the other documents to be delivered hereunder,
including, without limitation, the reasonable fees and expenses of
counsel for the Lender (including the cost of internal counsel) with
respect thereto and with respect to advising the Lender as to its
rights and responsibilities under the Credit Documents. The Credit
Parties further jointly and severally agree to pay on demand all costs
and expenses of the Lender, if any (including, without limitation,
reasonable attorneys' fees and expenses and the cost of internal
counsel), in connection with the enforcement (whether through
negotiations, legal proceedings, or otherwise) of the Credit Documents
and the other documents to be delivered hereunder.
(b) The Credit Parties jointly and severally agree to
indemnify and hold harmless the Lender and each of its Affiliates and
its respective officers, directors, employees, agents, and advisors
(each, an "Indemnified Party") from
55
57
and against any and all claims, damages, losses, liabilities, costs,
and expenses (including, without limitation, reasonable attorneys'
fees) that may be incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection with or
by reason of (including, without limitation, in connection with any
investigation, litigation, or proceeding or preparation of defense in
connection therewith) the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of
the Loan (including any of the foregoing arising from the negligence of
the Indemnified Party), except to the extent such claim, damage, loss,
liability, cost, or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted from
such Indemnified Party's gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the
indemnity in this Section 10.5 applies, such indemnity shall be
effective whether or not such investigation, litigation or proceeding
is brought by any of the Credit Parties, their respective directors,
shareholders or creditors or an Indemnified Party or any other Person
or any Indemnified Party is otherwise a party thereto and whether or
not the transactions contemplated hereby are consummated. The Credit
Parties agree not to assert any claim against the Lender, any of its
Affiliates, or any of its respective directors, officers, employees,
attorneys, agents, and advisers, on any theory of liability, for
special, indirect, consequential, or punitive damages arising out of or
otherwise relating to the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of
the Loan.
(c) Without prejudice to the survival of any other
agreement of the Credit Parties hereunder, the agreements and
obligations of the Credit Parties contained in this Section 10.5 shall
survive the repayment of the Loan and other obligations under the
Credit Documents.
10.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, the Lender.
10.7 COUNTERPARTS.
This Credit Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart for each of the parties hereto. Delivery by facsimile by any of
the parties hereto of an executed counterpart of this Credit Agreement shall be
as effective as an original executed counterpart hereof and shall be deemed a
representation that an original executed counterpart hereof will be delivered.
56
58
10.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
10.9 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 3.4 or 10.5 shall survive the execution and delivery of this Credit
Agreement, the making of the Loan, the repayment of the Loan and other
obligations under the Credit Documents, and all representations and warranties
made by the Credit Parties herein shall survive delivery of the Note and the
making of the Loan .
10.10 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS CREDIT AGREEMENT AND, UNLESS OTHERWISE EXPRESSLY
PROVIDED THEREIN, THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TENNESSEE. Any legal action or proceeding with respect to this
Credit Agreement or any other Credit Document may be brought in the
courts of the State of Tennessee, or of the United States located in
the State of Tennessee, and, by execution and delivery of this Credit
Agreement, each of the Credit Parties hereby irrevocably accepts for
itself and in respect of its property, generally and unconditionally,
the nonexclusive jurisdiction of such courts. Each of the Credit
Parties further irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address set out for notices pursuant to Section
10.1, such service to become effective three (3) days after such
mailing. Nothing herein shall affect the right of the Lender to serve
process in any other manner permitted by law or to commence legal
proceedings or to otherwise proceed against any Credit Party in any
other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives
any objection which it may now or hereafter have to the laying of venue
of any of the aforesaid actions or proceedings arising out of or in
connection with this Credit Agreement or any other Credit Document
brought in the courts referred to in subsection (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, THE LENDER AND EACH
OF THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR
57
59
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY
OF THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
10.11 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
10.12 ENTIRETY.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
10.13 BINDING EFFECT; TERMINATION.
(a) This Credit Agreement shall become effective at such
time when all of the conditions set forth in Section 5.1 have been
satisfied or waived by the Lender and it shall have been executed by
each Credit Party and the Lender, and thereafter this Credit Agreement
shall be binding upon and inure to the benefit of each Credit Party,
the Lender and their respective successors and assigns.
(b) The term of this Credit Agreement shall be until no
Loan or any other amounts payable hereunder or under any of the other
Credit Documents shall remain outstanding, all of the Credit Party
Obligations have been irrevocably satisfied in full.
10.14 CONFIDENTIALITY.
The Lender agrees to keep confidential any information furnished or
made available to it by the Credit Parties pursuant to this Credit Agreement;
provided that nothing herein shall prevent Lender from disclosing such
information (a) to any Affiliate of Lender, or any officer, director, employee,
agent, or advisor of Lender or Affiliate of Lender, (b) to any other Person if
reasonably incidental to the administration of the credit facility provided
herein, (c) as required by any law, rule, or regulation, (d) upon the order of
any court or administrative agency, (e) upon the request or demand of any
regulatory agency or authority, (f) that is or becomes available to the public
or that is or becomes available to Lender other than as a result of a disclosure
by Lender prohibited by this Credit Agreement, (g) in connection with any
litigation to which Lender or any of its Affiliates may be a party, (h) to the
extent necessary in connection with the exercise of any remedy under this Credit
Agreement
58
60
or any other Credit Document, and (i) subject to provisions substantially
similar to those contained in this Section 10.14, to any actual or proposed
participant or assignee.
10.15 USE OF SOURCES.
Lender hereby represents and warrants to the Borrower that at least one
of the following statements is an accurate representation as to the course of
funds to be used by Lender in connection with the financing hereunder:
(a) no part of such funds constitutes assets allocated to
any separate account maintained by Lender in which any employee benefit
plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes
assets allocated to any separate account maintained by Lender, Lender
has disclosed to the Borrower the name of each employee benefit plan
whose assets in such account exceed 10% of the total assets of such
account as of the date of such purchase (and, for purposes of this
subsection (b), all employee benefit plans maintained by the same
employer or employee organization are deemed to be a single plan;
(c) to the extent that any part of such funds constitutes
assets of an insurance company's general account, such insurance
company has complied with all of the requirements of the regulations
issued under Section 401(e)(a)(A) of ERISA; or
(d) such funds constitute assets of one or more specific
benefit plans which Lender has identified in writing to the Borrower.
As used in this Section 10.15, the terms "employee benefit plan" and
"separate account" shall have the respective meanings assigned to such terms in
Section 3 of ERISA.
10.16 CONFLICT.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
[Signature Page to Follow]
59
61
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: TRACTOR SUPPLY COMPANY
By: /s/ Calvin B. Massmann
---------------------------------------
Title: Sr. Vice President-CFO and Treasurer
------------------------------------
LENDER: SUNTRUST BANK
By: /s/ Allen K. Oakley
---------------------------------------
Title: Managing Director
------------------------------------
GUARANTORS:
-------------------------------------------
By:
----------------------------------------
Title:
-------------------------------------
-------------------------------------------
By:
----------------------------------------
Title:
-------------------------------------
60
62
EXHIBIT 10.54
SCHEDULE 1.1
LIENS
The Company has granted mortgages on various store properties owned by
the Company which serve as security for the Company's outstanding indebtedness
with Mutual Life Insurance Company of New York and MONY Life Insurance Company
of America as described on Schedule 8.1. The Company incurred this indebtedness
for working capital purposes.
The underlying locations are as follows:
Cedar Rapids, IA
Delaware, OH
Lansing, MI
Mankato, MN
Mason City, IA
No. Little Rock, AR
Rochester, MN
Evansville, IN
Marshalltown, IA
Port Huron, MI
Fort Wayne, IN
Paducah, KY
Battle Creek, MI
Lebanon, PA
Tiffin, OH
Charlotte, MI
Devils Lake, ND
Victoria, TX
Moorhead, MN
Hillsdale, MI
Wichita Falls, TX
Burleson, TX
Topeka North, KS
63
SCHEDULE 6.12
SUBSIDIARIES
NONE
62
64
SCHEDULE 6.19
LOCATION OF ASSETS
Chief Executive Office and Principal Place of Business:
TRACTOR SUPPLY COMPANY
320 PLUS PARK BOULEVARD
Nashville, Tennessee 37217
Phone: 615-366-4600
www.tractorsupplyco.com
-----------------------
63
65
SCHEDULE 6.23
LABOR MATTERS
1. Agreement, effective August 1, 1999, between the Company and General
Drivers & Helpers Union, Local #554.
64
66
SCHEDULE 7.6
CERTIFICATE OF INSURANCE
[TO BE ATTACHED]
65
67
SCHEDULE 8.1
EXISTING INDEBTEDNESS
BALANCE AT
AGREEMENT NAME SEPTEMBER 30, 2000
-------------- ------------------
Note Agreement Between Tractor Supply Company $3,690,504.12
and Mutual Life Insurance Company of New York
and MONY Life Insurance Company of America
dated as of April 1, 1988, as amended by that certain
First Amendment to Note Agreement, dated April 1,
1991, as further amended by that certain Second
Amendment to Note Agreement, dated as of February 1,
1992, as further amended by that certain Third Amendment
to Note Agreement, dated as of July 1, 1993.
Loan Agreement Between Tractor Supply Company $10,357,128.00
and SunTrust Bank, N.A., dated as of June 30, 1998. This
Agreement will be amended and restated simultaneous with
the closing under the Credit Agreement.
Capital lease obligations, various (See attached) $ 3,350,072.52
66
68
SCHEDULE 8.9
TRANSACTIONS WITH AFFILIATES
The Company leases its management headquarters and seven of its stores
from certain current and former members of its Board and senior management,
their wives, and certain entities controlled by them. Such persons entered into
these transactions principally to realize certain passive loss tax benefits that
were available at the time of entering into the leases, but were significantly
reduced by the Tax Reform Act of 1986. The Company believes these transactions
were consummated on general business terms comparable to those which would have
been available if they had been entered into with unrelated parties. The Company
does not intend to enter into any such transactions in the future without the
approval of its independent Audit Committee.
Pursuant to a lease agreement dated September 15, 1986, the Company
leases its management headquarters from GOF Partners, a general partnership of
which Messrs. Scarlett, Maxwell and Flood (each of whom are current executive
officers and/or directors of the Company) and two former members of the Board
and senior management of the Company, are the general partners. In September
1996, the Company exercised its option to renew the lease for two successive
five-year terms ending on February 9, 2007. Monthly rent is $30,000 for the
first five years, $32,000 for the second five years, $35,000 for the first
renewal term and $39,000 for the second renewal term. The Company has the option
to terminate the lease at any time after the end of the initial lease term by
offering to purchase the premises at a price of $4,775,000. If GOF Partners were
to reject the Company's offer to purchase, the lease would terminate 90 days
after the date of the offer.
On January 1, 1986, the Company entered into capitalized sale-leaseback
transactions with Mr. Scarlett and his wife for its Omaha, Nebraska store, two
former members of the Board and senior management of the Company and their wives
for its Corpus Christi, Texas; Toledo, Ohio; Waterloo, Iowa; and Sioux Falls,
South Dakota stores, Mr. Maxwell and his wife for its Nashville, Tennessee store
and Mr. Flood and his wife for its Mandan, North Dakota store. The Company sold
and leased back and provided the financing for such properties at estimated fair
values totaling $2,575,000. Management determined such sale prices based on the
appraised value of comparable stores acquired by the Company around that time.
The related gains arising from the sale-leaseback of these properties are
deferred and amortized on a straight-line basis over the lives of the related
leases. Properties under capital leases acquired through such sale-leaseback
transactions have been reduced by the related deferred gains on the properties
and are classified with property and equipment on the Company's financial
statements. Pursuant to substantially similar lease agreements dated January 1,
1986, the Company leases such stores for initial terms of 20 years, commencing
on January 1, 1986 and ending on December 31, 2005, subject to renewal at the
option of the Company for two successive five-year terms. The Company has the
option to terminate such leases after December 31, 1995 by offering to purchase
the premises at purchase prices ranging from $389,500 to $523,500 for the Corpus
Christi, Texas store to $934,800 to $1,256,300 for the Omaha, Nebraska store,
depending on the date of the offer. If the landlord were to reject an offer to
purchase a particular store, the lease would terminate 90 days after the date of
the offer. Monthly rent payments under such leases range from $2,580 to $6,081
for the Corpus Christi,
67
69
Texas store to $6,193 to $14,595 for the Omaha, Nebraska store. Rent payments
under all such leases totaled approximately $425,000 for the fiscal year ended
December 27, 1997. All of the 20 year nonrecourse installment deed notes between
the Company and such executive officers and/or directors and their wives were
subsequently repaid. The balance of these capitalized lease obligations, which
are included in total capital lease obligations on the Company's financial
statements, was $1,396,000 as of January 1, 2000.
The leases do not contain any restrictions on assignment by the
landlords. Moreover, if a landlord were to sell or otherwise transfer the leased
premises, it would not remain secondarily liable under the lease; rather, the
purchaser or transferee would be deemed, without any agreement with the Company,
to have assumed all of the obligations of the landlord arising after the date of
such sale or transfer.
Pursuant to a Consulting and Noncompetition Agreement between the
Company and Thomas J. Hennesy, III, dated as of May 1, 1991, Mr. Hennesy, who is
a former director and executive officer of the Company, has agreed to provide
consulting and advisory services to the Company from July 1, 1995 to June 30,
2000 and not to compete with the Company during such period and for two years
thereafter. During such seven-year period, the Company will pay Mr. Hennesy a
fee of $150,000 per annum and will provide him and his wife with certain health
benefits.
Pursuant to a Consulting Agreement between the Company and Thomas O.
Flood, dated as of August 31, 1999, Mr. Flood, who is currently a director of
the Company, has agreed to provide consulting and advisory services to the
Company from January 1, 2000 to December 31, 2000. During such period, the
Company will pay Mr. Flood a fee of $199,992. Pursuant to a Noncompetition
Agreement between the Company and Thomas O. Flood, dated as of August 31, 1999,
Mr. Flood, who is currently a director of the Company, has agreed not to compete
with the Company for the period from September 1, 1999 through December 31,
2004. During such five-year period, the Company will provide Mr. Flood and his
wife with certain health benefits.
68
70
EXHIBIT 10.54
EXHIBIT 7.1(C)
FORM OF OFFICER'S COMPLIANCE CERTIFICATE
TO: SunTrust Bank
P.O. Box 305110
Nashville, Tennessee 37230-5110
Attn: Allen Oakley or Tracy Elliott
RE: Amended and Restated Loan Agreement dated as of November 3, 2000 among
Tractor Supply Company (the "Borrower"), the Subsidiary Guarantors, and
SunTrust Bank (as the same may be amended, modified, extended or
restated from time to time, the "Credit Agreement"; all capitalized
terms used herein and not otherwise defined shall have the meanings
provided in the Credit Agreement)
DATE: _____________________, 20____
Pursuant to the terms of the Credit Agreement, I, ____________________
[Chief Financial Officer] of Tractor Supply Company (the "Borrower"), hereby
certify on behalf of the Borrower that the statements below are accurate and
complete in all respects:
(a) No Default or Event of Default exists under the
Credit Agreement, except as indicated on a separate page attached
hereto, together with an explanation of the action taken or proposed to
be taken with respect thereto.
(b) The quarterly/annual financial statements for the
fiscal quarter/year ended ____________________, 20____ which accompany
this certificate fairly present in all material respects the financial
condition of the Consolidated Parties and have been prepared in
accordance with GAAP.
(c) Attached hereto as Schedule 1 are calculations
(calculated as of the date of the financial statements referred to in
paragraph (b) above) demonstrating compliance by the Credit Parties
with the financial covenants contained in Section 7.11 of the Credit
Agreement.
TRACTOR SUPPLY COMPANY, a Delaware
corporation
By:
-------------------------------------------
Title:
----------------------------------------
71
SCHEDULE 1
TO OFFICER'S CERTIFICATE
1. Current Ratio
(a) Current Assets $________________________
(b) Current Liabilities $________________________
(c) Revolving Obligations Outstanding $________________________
(d) [(b) + (c)] $________________________
(e) Current Ratio [(a)/(d)] ____________________: 1.0
2. Fixed Charge Coverage Ratio
(a) Consolidated EBITR $________________________
(b) Consolidated Interest Expense $________________________
(c) Scheduled Funded Debt Payments $________________________
(d) Consolidated Rental Expense $________________________
(e) [(b) + (c) + (d)] $________________________
(f) Fixed Charge Coverage Ratio [(a)/(e)] ____________________: 1.0
3. Leverage Ratio
(a) Funded Indebtedness of the Consolidated Parties $________________________
(b) Consolidated Rental Expense $________________________
(c) [(a) + (b)] $________________________
(d) Consolidated EBITDA $________________________
(e) Consolidated Rental Expense $________________________
(f) [(d) + (e)] $________________________
(g) Leverage Ratio
[(c)/(f)] ____________________: 1.0
70
72
4. Net Worth
(a) Actual Net Worth as of the fiscal period
referred to above $________________________
(b) $133,200,000 $________________________
(c) 0.50 x cumulative Consolidated Net Income
(without deductions for any losses) $________________________
(d) Net Cash Proceeds from Equity Issuances
subsequent to Closing Date $________________________
(e) Net Worth required by Section 7.11(d)
[(b) + (c) + (d)] $________________________
71
73
EXHIBIT 7.12
FORM OF JOINDER AGREEMENT
THIS JOINDER AGREEMENT (this "Agreement"), dated as of _____________,
20____, is entered into between ______________________________, a
_________________________________________ (the "New Subsidiary") and SUNTRUST
BANK, in its capacity as Lender (the "Lender") under that certain Amended and
Restated Loan Agreement dated as of November 3, 2000 (as the same may be
amended, modified, extended or restated from time to time, the "Credit
Agreement") among Tractor Supply Company (the "Borrower"), the Subsidiary
Guarantors, and Lender. All capitalized terms used herein and not otherwise
defined shall have the meanings provided in the Credit Agreement.
The New Subsidiary and the Lender hereby agree as follows:
1. The New Subsidiary hereby acknowledges, agrees and confirms
that, by its execution of this Agreement. the New Subsidiary will be deemed to
be a Credit Party under the Credit Agreement and a "Subsidiary Guarantor" for
all purposes of the Credit Agreement and shall have all of the obligations of a
Subsidiary Guarantor thereunder as if it had executed the Credit Agreement. The
New Subsidiary hereby ratifies, as of the date hereof, and agrees to be bound
by, all of the terms, provisions and conditions contained in the Credit
Agreement, including without limitation (a) all of the representations and
warranties of the Credit Parties set forth in Section 6 of the Credit Agreement,
(b) all of the affirmative and negative covenants set forth in Sections 7 and 8
of the Credit Agreement and (c) all of the guaranty obligations set forth in
Section 4 of the Credit Agreement. Without limiting the generality of the
foregoing terms of this paragraph 1, the New Subsidiary hereby guarantees,
jointly and severally with the other Subsidiary Guarantors, to the Lender, as
provided in Section 4 of the Credit Agreement, the prompt payment and
performance of the Credit Party Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise) strictly in
accordance with the terms thereof and agrees that if any of the Credit Party
Obligations are not paid or performed in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise), the New
Subsidiary will, jointly and severally together with the other Subsidiary
Guarantors, promptly pay and perform the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Credit Party Obligations, the same will be promptly paid in full
when due (whether at extended maturity, as a mandatory prepayment, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal. The New Subsidiary hereby represents and warrants to the Lender that
(a) set forth on Schedule A attached hereto is the chief executive office and
principal place of business of the New Subsidiary and (b) set forth on Schedule
B attached hereto is a complete and accurate list of all Subsidiaries of the New
Subsidiary. Each of Schedule 6.12 and Schedule 6.19 of the Credit Agreement are
hereby deemed amended to include the information on Schedules A and B attached
hereto, as applicable.
74
2. The New Subsidiary is, simultaneously with the execution of
this Agreement, executing and delivering such documents and instruments as
requested by the Lender in accordance with Section 7.12 of the Credit Agreement.
3. The address of the New Subsidiary for purposes of Section 10.1
of the Credit Agreement is as follows:
-----------------------------
-----------------------------
-----------------------------
-----------------------------
4. The New Subsidiary hereby waives acceptance by the Lender of
the guaranty by the New Subsidiary under the Credit Agreement upon the execution
of this Agreement by the New Subsidiary.
5. This Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument.
6. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be
duly executed by its authorized officer, and the Lender has caused the same to
be accepted by its authorized officer, as of the day and year first above
written.
--------------------------------------------
By:
-----------------------------------------
Title:
--------------------------------------
Acknowledged and accepted:
SUNTRUST BANK
By:
------------------------------------
Title:
---------------------------------
73
75
EXHIBIT 10.3(B)
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Amended and Restated Loan Agreement
dated as of November 3, 2000 (as amended, modified, extended or restated from
time to time, the "Credit Agreement") among Tractor Supply Company (the
"Borrower"), the Subsidiary Guarantors, and SunTrust Bank (the "Lender"). All
capitalized terms used herein and not otherwise defined shall have the meanings
provided in the Credit Agreement.
The "Assignor" and the "Assignee" referred to on Schedule 1 attached
hereto agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse and without representation or warranty except as expressly set forth
herein, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement and the other Credit Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Credit Agreement and the other Credit Documents.
2. The Assignor (i) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any Lien; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Credit Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any other instrument or document furnished
pursuant thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Credit Party or
the performance or observance by any Credit Party of any of its obligations
under the Credit Documents or any other instrument or document furnished
pursuant thereto.
3. The Assignee (i) represents and warrants that it is a
commercial lender, other financial institution or other "accredited" investor
(as defined in SEC Regulation D) which makes or acquires loans in the ordinary
course of business and that it will make or acquire Loans for its own account in
the ordinary course of business, (ii) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 7.1 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (iii) agrees that it will, independently and
without reliance upon the Assignor and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit Agreement; and (iv)
confirms that it is an Eligible Assignee.
76
4. Upon acceptance and recording by the Assignor of this
Assignment and Acceptance (the "Effective Date"), (i) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of the Lender thereunder and (ii)
the Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.
5. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes for periods
prior to the Effective Date directly between themselves.
6. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
7. This Assignment and Acceptance may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment Agreement to be executed by their officers thereunto duly authorized
as of the date hereof.
75
77
, as Assignor
-------------------------------
By:
-----------------------------------------
Title:
--------------------------------------
, as Assignee
-------------------------------
By:
-----------------------------------------
Title:
--------------------------------------
Notice address of Assignee:
--------------------------------------------
--------------------------------------------
Attn:
---------------------------------------
Telephone:
----------------------------------
Telecopy:
-----------------------------------
CONSENTED TO:
TRACTOR SUPPLY COMPANY, a
Delaware corporation
By:
----------------------------------
Title:
-------------------------------
76
78
SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE
(a) Date of Assignment _________________
(b) Legal Name of Assignor _________________
(c) Legal Name of Assignee _________________
(d) Effective Date of Assignment _________________
(e) Principal amount of Loan assigned on
Effective Date $________________
77