Exhibit 10.1
[EXECUTION COPY]
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_____________________________________________________
$175,000,000
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
November 14, 2003
____________________________________________________
ANNTAYLOR, INC.,
ANNCO, INC.,
ANNTAYLOR DISTRIBUTION SERVICES, INC.
and
ANNTAYLOR RETAIL, INC.,
as the Borrowers,
BANK OF AMERICA, N.A.,
as Administrative Agent and as Collateral Agent,
JPMORGAN CHASE BANK.,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Syndication Agents
FLEET RETAIL GROUP,
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Documentation Agents
and
THE FINANCIAL INSTITUTIONS NAMED HEREIN,
as Lenders
BANC OF AMERICA SECURITIES LLC,
as Lead Arranger
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TABLE OF CONTENTS
Page
ARTICLE 1 LOANS AND LETTERS OF CREDIT....................................................................1
1.1 Total Facility.................................................................................1
1.2 Revolving Loans................................................................................2
1.3 [Intentionally omitted.].......................................................................5
1.4 Letters of Credit..............................................................................5
1.5 Bank Products..................................................................................8
1.6 Increase in Commitments........................................................................8
ARTICLE 2 INTEREST AND FEES.............................................................................10
2.1 Interest......................................................................................10
2.2 Continuation and Conversion Elections.........................................................10
2.3 Maximum Interest Rate.........................................................................11
2.4 Closing Fee...................................................................................12
2.5 Unused Line Fee...............................................................................12
2.6 Letter of Credit Fee..........................................................................12
ARTICLE 3 PAYMENTS AND PREPAYMENTS......................................................................13
3.1 Revolving Loans...............................................................................13
3.2 Termination of Facility.......................................................................13
3.3 [Intentionally omitted.] .....................................................................13
3.4 [Intentionally omitted.] .....................................................................13
3.5 [Intentionally omitted.]......................................................................13
3.6 Payments by the Borrowers.....................................................................13
3.7 Payments as Revolving Loans...................................................................14
3.8 Apportionment, Application and Reversal of Payments...........................................14
3.9 Indemnity for Returned Payments...............................................................15
3.10 Agent's and Lenders' Books and Records; Monthly Statements....................................15
ARTICLE 4 TAXES, YIELD PROTECTION AND ILLEGALITY........................................................16
4.1 Taxes.........................................................................................16
4.2 Illegality....................................................................................17
4.3 Increased Costs and Reduction of Return.......................................................18
4.4 Funding Losses................................................................................18
4.5 Inability to Determine Rates..................................................................19
4.6 Certificates of Agent.........................................................................19
4.7 Survival......................................................................................19
4.8 Replacement of Lenders........................................................................19
ARTICLE 5 BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES.............................................20
5.1 Books and Records.............................................................................20
5.2 Financial Information.........................................................................20
5.3 Notices to the Lenders........................................................................23
ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS........................................................25
6.1 Authorization, Validity, and Enforceability of this Agreement and the Loan Documents..........25
6.2 Validity and Priority of Security Interest....................................................26
6.3 Organization and Qualification................................................................26
6.4 Corporate Name; Prior Transactions............................................................26
6.5 Subsidiaries and Affiliates...................................................................26
6.6 Financial Statements and Projections..........................................................27
6.7 Capitalization................................................................................27
6.8 Solvency......................................................................................27
6.9 Debt27
6.10 Distributions.................................................................................27
6.11 Real Estate; Store Locations..................................................................27
6.12 [Intentionally Omitted].......................................................................28
6.13 Trade Names...................................................................................28
6.14 Litigation....................................................................................28
6.15 Labor Disputes................................................................................28
6.16 Environmental Laws............................................................................28
6.17 No Violation of Law...........................................................................29
6.18 No Default....................................................................................29
6.19 ERISA Compliance..............................................................................30
6.20 Taxes.........................................................................................30
6.21 Regulated Entities............................................................................30
6.22 Use of Proceeds; Margin Regulations...........................................................31
6.23 Copyrights, Patents, Trademarks and Licenses, etc.............................................31
6.24 No Material Adverse Effect....................................................................31
6.25 Full Disclosure...............................................................................31
6.26 Material Agreements...........................................................................31
6.27 Bank Accounts.................................................................................31
6.28 Governmental Authorization....................................................................32
6.29 Tax Shelter Regulations.......................................................................32
ARTICLE 7 AFFIRMATIVE AND NEGATIVE COVENANTS............................................................32
7.1 Taxes and Other Obligations...................................................................32
7.2 Legal Existence and Good Standing.............................................................32
7.3 Compliance with Law and Agreements; Maintenance of Licenses...................................32
7.4 Maintenance of Property; Appraisals and Inspection of Property................................33
7.5 Insurance.....................................................................................33
7.6 Insurance and Condemnation Proceeds...........................................................34
7.7 Environmental Laws............................................................................35
7.8 Compliance with ERISA.........................................................................36
7.9 Debt36
7.10 Sales of Assets; Liens........................................................................37
7.11 Investments...................................................................................39
7.12 Accommodation Obligations.....................................................................41
7.13 Restricted Payments...........................................................................42
7.14 Conduct of Business...........................................................................42
7.15 Transactions with Affiliates..................................................................42
7.16 Restriction on Fundamental Changes............................................................43
7.17 ERISA.........................................................................................43
7.18 Sales and Leasebacks..........................................................................44
7.19 Convertible Debentures and other Debt.........................................................44
7.20 Margin Regulations............................................................................44
7.21 Change of Fiscal Year.........................................................................44
7.22 Subsidiaries..................................................................................45
7.23 Consignment of Title Documents................................................................45
7.24 Fixed Charge Coverage Ratio...................................................................45
7.25 [Intentionally Omitted].......................................................................45
7.26 Further Assurances............................................................................45
7.27 Pledge of After-Acquired Property; Additional Borrowers.......................................45
7.28 Cash Collateral and Deposit Accounts..........................................................47
ARTICLE 8 CONDITIONS OF LENDING.........................................................................48
8.1 Conditions Precedent to Making of Loans on the Effective Date.................................48
8.2 Conditions Precedent to Each Loan.............................................................49
ARTICLE 9 DEFAULT; REMEDIES.............................................................................50
9.1 Events of Default.............................................................................50
9.2 Remedies......................................................................................52
ARTICLE 10 TERM AND TERMINATION..........................................................................54
10.1 Term and Termination..........................................................................54
ARTICLE 11 AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS..................................54
11.1 Amendments and Waivers........................................................................54
11.2 Assignments; Participations...................................................................55
ARTICLE 12 THE AGENT.....................................................................................58
12.1 Appointment and Authorization.................................................................58
12.2 Delegation of Duties..........................................................................58
12.3 Liability of Agent............................................................................58
12.4 Reliance by Agent.............................................................................59
12.5 Notice of Default.............................................................................59
12.6 Credit Decision...............................................................................59
12.7 Indemnification...............................................................................60
12.8 Agent in Individual Capacity..................................................................60
12.9 Successor Agent...............................................................................60
12.10 Withholding Tax...............................................................................61
12.11 Collateral Matters............................................................................62
12.12 Restrictions on Actions by Lenders; Sharing of Payments.......................................63
12.13 Agency for Perfection.........................................................................64
12.14 Payments by Agent to Lenders..................................................................64
12.15 Settlement....................................................................................64
12.16 Letters of Credit; Intra-Lender Issues........................................................67
12.17 Concerning the Collateral and the Related Loan Documents......................................69
12.18 Field Audit and Examination Reports; Disclaimer by Lenders....................................69
12.19 Relation Among Lenders........................................................................70
12.20 Co-Agents.....................................................................................70
ARTICLE 13 GUARANTEES....................................................................................70
13.1 Guaranty......................................................................................70
13.2 Contribution..................................................................................71
13.3 Waivers; Other Agreements.....................................................................72
13.4 Guarantee Absolute and Unconditional..........................................................75
13.5 Reinstatement.................................................................................76
13.6 Payment.......................................................................................76
ARTICLE 14 MISCELLANEOUS.................................................................................77
14.1 No Waivers; Cumulative Remedies...............................................................77
14.2 Severability..................................................................................77
14.3 Governing Law; Choice of Forum; Service of Process............................................77
14.4 WAIVER OF JURY TRIAL..........................................................................78
14.5 Survival of Representations and Warranties....................................................78
14.6 Other Security and Guaranties.................................................................79
14.7 Fees and Expenses.............................................................................79
14.8 Notices.......................................................................................79
14.9 Waiver of Notices.............................................................................81
14.10 Binding Effect................................................................................81
14.11 Indemnity of the Agent and the Lenders by the Borrowers.......................................81
14.12 Limitation of Liability.......................................................................82
14.13 Final Agreement...............................................................................82
14.14 Counterparts..................................................................................82
14.15 Captions......................................................................................82
14.16 Right of Setoff...............................................................................82
14.17 Confidentiality...............................................................................83
14.18 Conflicts with Other Loan Documents...........................................................84
ARTICLE 15 AMENDMENT AND RESTATEMENT.....................................................................84
15.1 Amendment and Restatement.....................................................................84
15.2 Assignment and Acceptance.....................................................................84
ANNEXES, EXHIBITS AND SCHEDULES
ANNEX A - DEFINITIONS
EXHIBIT A - FORM OF COMPLIANCE CERTIFICATE
EXHIBIT B - FORM OF BORROWING BASE CERTIFICATE
EXHIBIT C - FINANCIAL STATEMENTS
EXHIBIT D - FORM OF NOTICE OF BORROWING
EXHIBIT E - FORM OF NOTICE OF CONTINUATION/CONVERSION
EXHIBIT F - FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
EXHIBIT G - FORM OF SECURITY AGREEMENT
EXHIBIT H - FORM OF PARENT GUARANTY
SCHEDULE 1.1 - COMMITMENTS
SCHEDULE 1.4 - EXISTING LETTERS OF CREDIT
SCHEDULE 6.5 - SUBSIDIARIES AND AFFILIATES
SCHEDULE 6.7 - SUBSIDIARY CAPITALIZATION
SCHEDULE 6.9 - DEBT
SCHEDULE 6.10 - DISTRIBUTIONS
SCHEDULE 6.11 - REAL ESTATE
SCHEDULE 6.13 - TRADE NAMES
SCHEDULE 6.14 - LITIGATION
SCHEDULE 6.16 - ENVIRONMENTAL LAW
SCHEDULE 6.19 - ERISA COMPLIANCE
SCHEDULE 6.27 - BANK ACCOUNTS
SCHEDULE 7.10(b) - PERMITTED EXISTING LIENS
SCHEDULE 7.11 - INVESTMENTS
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of
November 14, 2003 (this "Agreement"), is made by and among the financial
institutions from time to time parties hereto (such financial institutions,
together with their respective successors and assigns, are referred to
hereinafter each individually as a "Lender" and collectively as the "Lenders"),
BANK OF AMERICA, N.A., as Administrative Agent and Collateral Agent for the
Lenders (in such capacities, the "Agent"), JPMORGAN CHASE BANK and WACHOVIA
BANK, NATIONAL ASSOCIATION, as Syndication Agents, FLEET RETAIL GROUP and THE
CIT GROUP/BUSINESS CREDIT, INC., as Documentation Agents, ANNTAYLOR, INC., a
Delaware corporation ("ATI"), ANNCO, INC., a Delaware corporation ("ANNCO"),
ANNTAYLOR DISTRIBUTION SERVICES, INC., a Delaware corporation ("AT
Distribution"), and ANNTAYLOR RETAIL, INC., a Delaware corporation ("AT
Retail"; ATI, ANNCO, AT Distribution and AT Retail may be referred to
individually herein as a "Borrower" or collectively as the "Borrowers").
W I T N E S S E T H:
WHEREAS, ATI, the lenders referred to therein, the syndication agents
named therein, the issuing banks named therein and the administrative agent
named therein have entered into that certain Original Credit Agreement (as
defined in Annex A hereto);
WHEREAS, ATI has requested that the Lenders continue to make available
to it a revolving line of credit for loans and letters of credit in an amount
not to exceed $175,000,000 and add ANNCO, AT Distribution and AT Retail as
Borrowers thereunder by amending the terms of the Original Credit Agreement,
and restating such terms in their entirety, as set forth herein;
WHEREAS, capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings ascribed thereto in Annex A which is
attached hereto and incorporated herein; the rules of construction contained
therein shall govern the interpretation of this Agreement and the other Loan
Documents, and all Annexes, Exhibits and Schedules attached hereto are
incorporated herein by reference; and
WHEREAS, the Lenders have agreed to continue to make available to the
Borrowers a revolving credit facility upon the terms and conditions set forth
in this Agreement;
NOW, THEREFORE, in consideration of the mutual conditions and
agreements set forth in this Agreement, and for good and valuable
consideration, the receipt of which is hereby acknowledged, the Lenders, the
Agent and the Borrowers hereby agree that the Original Credit Agreement is
hereby amended and restated in its entirety, effective as of the Effective
Date, as follows.
ARTICLE 1
LOANS AND LETTERS OF CREDIT
1.1 Total Facility. Subject to all of the terms and conditions of this
Agreement, the Lenders agree to make available a total credit facility (the
"Total Facility") of up to $175,000,000, or such greater amount as may be
established pursuant to Section 1.6 (the "Total Facility Amount"), to the
Borrowers from time to time during the term of this Agreement. The Total
Facility shall be composed of a revolving line of credit consisting of
Revolving Loans and Letters of Credit.
1.2 Revolving Loans.
(a) Amounts. Subject to the satisfaction of the conditions
precedent set forth in Article 8, each Lender severally, but not jointly,
agrees, upon any Borrower's request from time to time on any Business Day
during the period from the Effective Date to the Termination Date, to make
revolving loans (the "Revolving Loans") to such Borrower in amounts not to
exceed such Lender's Pro Rata Share of Availability, except for Non-Ratable
Loans and Agent Advances. The Lenders, however, in their unanimous discretion,
may elect to make Revolving Loans or issue or arrange to have issued Letters of
Credit in excess of the Borrowing Base on one or more occasions, but if they do
so, neither the Agent nor the Lenders shall be deemed thereby to have changed
the limits of the Borrowing Base or to be obligated to exceed such limits on
any other occasion. If any Borrowing would exceed Availability, the Lenders may
refuse to make or may otherwise restrict the making of Revolving Loans as the
Lenders determine until such excess has been eliminated, subject to the Agent's
authority, in its sole discretion, to make Agent Advances pursuant to the terms
of Section 1.2(i). If there occurs any change in how (i) trade-payables,
inventory purchases or other obligations (other than the Obligations hereunder)
of the Borrowers are incurred or (ii) any Borrower's business is conducted
that, in either case, results in any material increase in trade-payables,
inventory purchases or other obligations (other than the Obligations hereunder)
of any Borrower other than ATI, the Agent may require the Borrowers to, and the
Borrowers agree to, amend this Agreement to reflect a multiple borrowing base
structure for the Credit Extensions provided hereunder.
(b) Procedure for Borrowing.
(i) Each Borrowing shall be made upon a Borrower's
irrevocable written notice delivered to the Agent in the form of a notice of
borrowing ("Notice of Borrowing"), which must be received by the Agent prior to
(i) 11:00 a.m. (New York City time) three Business Days prior to the requested
Funding Date, in the case of LIBOR Loans and (ii) 11:00 a.m. (New York City
time) on the requested Funding Date, in the case of Base Rate Loans,
specifying:
(A) the amount of the Borrowing, which in the case of a
LIBOR Loan must equal or exceed $1,000,000 (and increments of
$1,000,000 in excess of such amount);
(B) the requested Funding Date, which must be a Business
Day;
(C) whether the Revolving Loans requested are to be Base
Rate Loans or LIBOR Loans (and if not specified, it shall be deemed a
request for a Base Rate Loan); and
(D) the duration of the Interest Period for LIBOR Loans (and
if not specified, it shall be deemed a request for an Interest Period
of one month);
provided, however, that with respect to the Borrowing to be made on the
Effective Date, such Borrowings will consist of Base Rate Loans only.
(ii) In lieu of delivering a Notice of Borrowing, any
Borrower may give the Agent telephonic notice of such request for advances to
the Designated Account on or before the deadline set forth above. The Agent at
all times shall be entitled to rely on such telephonic notice in making such
Revolving Loans, regardless of whether any written confirmation is received.
(c) Reliance upon Authority. Prior to the Effective Date, each
Borrower shall deliver to the Agent, a notice setting forth the account of such
Borrower ("Designated Account") to which the Agent is authorized to transfer
the proceeds of the Revolving Loans requested hereunder. Any Borrower may
designate a replacement account from time to time by written notice from a
Responsible Officer. All such Designated Accounts must be reasonably
satisfactory to the Agent. The Agent is entitled to rely conclusively on any
person's request for Revolving Loans on behalf of such Borrower, so long as the
proceeds thereof are to be transferred to the Designated Account. The Agent has
no duty to verify the identity of any individual representing himself or
herself as a person authorized by such Borrower to make such requests on its
behalf.
(d) No Liability. The Agent shall not incur any liability to any
Borrower as a result of acting upon any notice referred to in Sections 1.2(b)
and (c), which the Agent believes in good faith to have been given by an
officer or other person duly authorized by such Borrower to request Revolving
Loans on its behalf. The crediting of Revolving Loans to the Designated Account
conclusively establishes the obligation of such Borrower to repay such
Revolving Loans as provided herein.
(e) Notice Irrevocable. Any Notice of Borrowing (or telephonic
notice in lieu thereof) made pursuant to Section 1.2(b) shall be irrevocable.
The applicable Borrower shall be bound to borrow the funds requested therein in
accordance therewith.
(f) Agent's Election. Promptly after receipt of a Notice of
Borrowing (or telephonic notice in lieu thereof), the Agent shall elect to have
the terms of Section 1.2(g) or the terms of Section 1.2(h) apply to such
requested Borrowing. If the Bank declines in its sole discretion to make a
Non-Ratable Loan pursuant to Section 1.2(h), the terms of Section 1.2(g) shall
apply to the requested Borrowing.
(g) Making of Revolving Loans. If Agent elects to have the terms
of this Section 1.2(g) apply to a requested Borrowing, then promptly after
receipt of a Notice of Borrowing or telephonic notice in lieu thereof, the
Agent shall notify the Lenders by telecopy, telephone or e-mail of the
requested Borrowing. Each Lender shall transfer its Pro Rata Share of the
requested Borrowing available to the Agent in immediately available funds, to
the account from time to time designated by Agent, not later than 12:00 noon
(New York City time) on the applicable Funding Date. After the Agent's receipt
of all proceeds of such Revolving Loans, the Agent shall make the proceeds of
such Revolving Loans available to the applicable Borrower on the applicable
Funding Date by transferring same day funds to the Designated Account;
provided, however, that the amount of Revolving Loans so made on any date shall
not exceed the Availability on such date.
(h) Making of Non-Ratable Loans.
(i) If Agent elects, with the consent of the Bank, to have
the terms of this Section 1.2(h) apply to a requested Borrowing, the Bank shall
make a Revolving Loan in the amount of that Borrowing available to the
applicable Borrower on the applicable Funding Date by transferring same day
funds to such Borrower's Designated Account. Each Revolving Loan made solely by
the Bank pursuant to this Section is herein referred to as a "Non-Ratable
Loan", and such Revolving Loans are collectively referred to as the
"Non-Ratable Loans." Each Non-Ratable Loan shall be subject to all the terms
and conditions applicable to other Revolving Loans except that all payments
thereon shall be payable to the Bank solely for its own account. The aggregate
amount of Non-Ratable Loans outstanding at any time shall not exceed
$20,000,000. The Agent shall not request the Bank to make any Non-Ratable Loan
if (A) the Agent has received written notice from any Borrower or any Lender
that one or more of the applicable conditions precedent set forth in Article 8
will not be satisfied on the requested Funding Date for the applicable
Borrowing, or (B) the requested Borrowing would exceed Availability on that
Funding Date.
(ii) The Non-Ratable Loans shall be secured by the Agent's
Liens in and to the Collateral and shall constitute Base Rate Loans and
Obligations hereunder.
(i) Agent Advances.
(i) Subject to the limitations set forth below, the Agent is
authorized by the Borrowers and the Lenders, from time to time in the Agent's
sole discretion after notice to and consultation with ATI, (A) after the
occurrence of a Default or an Event of Default, or (B) at any time that any of
the other conditions precedent set forth in Article 8 have not been satisfied,
to make Base Rate Loans to one or more of the Borrowers on behalf of the
Lenders which the Agent, in its reasonable business judgment, deems necessary
or desirable (1) to preserve or protect the Collateral, or any portion thereof,
(2) to enhance the likelihood of, or maximize the amount of, repayment of the
Loans and other Obligations (including to provide cash collateral for
outstanding Letters of Credit to the extent not otherwise funded by the
Borrowers in accordance with Section 1.4(b) or (g)), or (3) to pay any other
amount chargeable to any Borrower pursuant to the terms of this Agreement,
including costs, fees and expenses as described in Section 14.7 (any of such
advances are herein referred to as "Agent Advances"); provided, that (A) at no
time shall the aggregate amount of Agent Advances exceed 10% of the Borrowing
Base on the date any Agent Advance is made, (B) at no time shall the aggregate
amount of Agent Advances plus Aggregate Outstandings exceed the Total Facility
Amount, and (C) the Required Lenders may at any time revoke the Agent's
authorization to make Agent Advances. Any such revocation must be in writing
and shall become effective prospectively upon the Agent's receipt thereof.
(ii) As of the date of any Agent Advance made hereunder, the
Agent shall have made arrangements with the Borrowers intended to eliminate or
repay such Agent Advance within a reasonable time thereafter but in no event
later than sixty (60) days following the date such Agent Advance is made.
(iii) The Agent Advances shall be secured by the Agent's
Liens in and to the Collateral and shall constitute Base Rate Loans and
Obligations hereunder.
1.3 [Intentionally omitted.]
1.4 Letters of Credit.
(a) Agreement to Issue or Cause To Issue. Subject to the terms
and conditions of this Agreement and the applicable Issuing Bank Agreement,
upon request of any Borrower a Letter of Credit Issuer will issue for the
account of any Borrower one or more Letters of Credit.
(b) Amounts; Outside Expiration Date; Automatic Renewal. No
Letter of Credit Issuer shall have any obligation to issue any Letter of Credit
at any time if: (i) the maximum face amount of the requested Letter of Credit is
greater than the Unused Letter of Credit Subfacility at such time; (ii) the
maximum undrawn amount of the requested Letter of Credit and all commissions,
fees, and charges due from such Borrower in connection with the opening thereof
would exceed Availability at such time; or (iii) such Letter of Credit has an
expiration date less than four (4) Business Days prior to the Stated
Termination Date or more than 12 months from the date of issuance for standby
letters of credit and 180 days (subject to extension for a maximum period of
sixty (60) days) for documentary letters of credit. If Letter of Credit
Outstandings at any time exceed the lesser of the Borrowing Base or the Letter
of Credit Subfacility, the Borrowers shall immediately provide cash collateral
to the Agent in the amount of such excess to be held by the Agent until such
time that no such excess amount exists.
The Letter of Credit Issuers and the Lenders agree that, while a
Standby Letter of Credit is outstanding and prior to the Termination Date, at
the option of the applicable Borrower and upon the written request of the
applicable Borrower received by the applicable Letter of Credit Issuer at least
five (5) days (or such shorter time as such Letter of Credit Issuer may agree in
a particular instance in its sole discretion) prior to the proposed date of
notification of renewal, such Letter of Credit Issuer shall be entitled to
authorize the automatic renewal of any Standby Letter of Credit issued by it so
long as, immediately after the renewal thereof, the aggregate amount of Letter
of Credit Outstandings does not exceed the Letter of Credit Subfacility and
Aggregate Outstandings do not exceed the lesser of the Total Facility Amount or
the Borrowing Base. Each such request for renewal of a Letter of Credit shall
specify in form and detail satisfactory to the applicable Letter of Credit
Issuer (i) the Letter of Credit to be renewed, (ii) the proposed date of
notification of renewal of the Letter of Credit (which shall be a Business Day),
(iii) the revised expiry date of the Letter of Credit, and (iv) such other
matters as such Letter of Credit Issuer may require. No Letter of Credit Issuer
shall so renew any Letter of Credit if (A) such Letter of Credit Issuer has
actual knowledge that it would have no obligation at such time to issue or amend
a Letter of Credit under the terms of Section 1.4(b) or (c) or Section 8.2, or
(B) the beneficiary of any such Letter of Credit does not accept the proposed
renewal of the Letter of Credit.
(c) Other Conditions. In addition to conditions precedent
contained in Article 8, the obligation of the Agent to cause to be issued or of
the Letter of Credit Issuers to issue any Letter of Credit is subject to the
following conditions precedent having been satisfied in a manner reasonably
satisfactory to the Letter of Credit Issuers and the Agent:
(i) The applicable Borrower shall have delivered to the
applicable Letter of Credit Issuer, at such times and in such manner as such
Letter of Credit Issuer may prescribe, an application in form and substance
reasonably satisfactory to such Letter of Credit Issuer and reasonably
satisfactory to the Agent for the issuance of the Letter of Credit and such
other documents as may be required pursuant to the terms thereof, and the form,
terms and purpose of the proposed Letter of Credit shall be reasonably
satisfactory to the Agent and such Letter of Credit Issuer; and
(ii) As of the date of issuance, no order of any court,
arbitrator or Governmental Authority shall purport by its terms to enjoin or
restrain money center banks generally from issuing letters of credit of the
type and in the amount of the proposed Letter of Credit, and no law, rule or
regulation applicable to money center banks generally and no request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over money center banks generally shall prohibit,
or request that the proposed Letter of Credit Issuer refrain from, the issuance
of letters of credit generally or the issuance of such Letters of Credit.
(d) Issuance of Letters of Credit.
(i) Request for Issuance. The Borrower for whose account the
Letter of Credit is to be issued must notify the Agent and the applicable
Letter of Credit Issuer of a requested Letter of Credit on the proposed
issuance date. Such notice shall be irrevocable and must specify the original
face amount of the Letter of Credit requested, the Business Day of issuance of
such requested Letter of Credit, whether such Letter of Credit may be drawn in
a single or in partial draws, the Business Day on which the requested Letter of
Credit is to expire, the purpose for which such Letter of Credit is to be
issued, and the beneficiary of the requested Letter of Credit. In the case of
Standby Letters of Credit, the full text of any certificate to be presented by
the beneficiary in case of any drawing thereunder shall be delivered to the
applicable Letter of Credit Issuer on the date of such request. Such notice
shall comply with any additional requirements as are set forth in the relevant
Issuing Bank Agreement or as the relevant Letter of Credit Issuer may require.
Such Borrower shall attach to such notice the proposed form of the Letter of
Credit .
(ii) Responsibilities of the Borrowers; Issuance. As of the
requested issuance date of the Letter of Credit, the requesting Borrower shall
determine the amount of the Unused Letter of Credit Subfacility and Availability
of such Borrower and that all conditions to the obligation of any Letter of
Credit Issuer to issue a Letter of Credit under Sections 1.4(b) and (c) and
Section 8.2 have been satisfied. If (i) the face amount of the requested Letter
of Credit is less than the Unused Letter of Credit Subfacility and (ii) the
amount of such requested Letter of Credit and all commissions, fees, and charges
due from the requesting Borrower in connection with the opening thereof would
not exceed Availability, such Borrower may apply to the Letter of Credit Issuer
to issue the requested Letter of Credit on the requested issuance date so long
as the other conditions hereof and under the applicable Issuing Bank Agreement
are met.
(e) Payments Pursuant to Letters of Credit. Each Borrower agrees
to reimburse immediately the applicable Letter of Credit Issuer for any draw
under any Letter of Credit issued for the account of such Borrower and to pay
the applicable Letter of Credit Issuer the amount of all other charges and fees
payable to the Letter of Credit Issuer in connection with any Letter of Credit
immediately when due, irrespective of any claim, setoff, defense or other right
which such Borrower may have at any time against such Letter of Credit Issuer
or any other Person. Each drawing under any Letter of Credit shall constitute a
request by such Borrower to the Agent for a Borrowing of a Base Rate Loan in
the amount of such drawing. The Funding Date with respect to such borrowing
shall be the date of such drawing.
(f) Indemnification; Exoneration; Power of Attorney.
(i) Indemnification. In addition to amounts payable as
elsewhere provided in this Section 1.4, each Borrower agrees to protect,
indemnify, pay and save the Lenders and the Agent harmless from and against any
and all claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees) which any Lender or the Agent
(other than a Lender in its capacity as Letter of Credit Issuer) may incur or
be subject to as a consequence, direct or indirect, of the issuance of any
Letter of Credit for the account of such Borrower, except to the extent it is
determined in a final, non-appealable judgment of a court of competent
jurisdiction that such amounts arose as a direct result of the gross negligence
or willful misconduct of the Agent or such Lender. The Borrowers' obligations
under this Section shall survive payment of all other Obligations.
(ii) Assumption of Risk by the Borrowers. As among the
Borrowers, the Lenders, and the Agent, each Borrower assumes all risks of the
acts and omissions of, or misuse of any of the Letters of Credit by, the
respective beneficiaries of such Letters of Credit. In furtherance and not in
limitation of the foregoing, the Lenders (other than a Lender in its capacity
as Letter of Credit Issuer) and the Agent shall not be responsible for: (A) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any Person in connection with the application for and
issuance of and presentation of drafts with respect to any of the Letters of
Credit, even if it should prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or proceeds thereof,
in whole or in part, which may prove to be invalid or ineffective for any
reason; (C) the failure of the beneficiary of any Letter of Credit to comply
duly with conditions required in order to draw upon such Letter of Credit; (D)
errors, omissions, interruptions, or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise, whether or not they be
in cipher; (E) errors in interpretation of technical terms; (F) any loss or
delay in the transmission or otherwise of any document required in order to
make a drawing under any Letter of Credit or of the proceeds thereof; (G) the
misapplication by the beneficiary of any Letter of Credit of the proceeds of
any drawing under such Letter of Credit; (H) any consequences arising from
causes beyond the control of the Lenders or the Agent, including any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto Governmental Authority or (I) a Letter of Credit Issuer's honor of a draw
for which the draw or any certificate fails to comply in any respect with the
terms of the Letter of Credit. None of the foregoing shall affect, impair or
prevent the vesting of any rights or powers of the Agent or any Lender under
this Section 1.4(f).
(iii) Exoneration. Without limiting the foregoing, no action
or omission whatsoever by Agent or any Lender (excluding any Lender in its
capacity as a Letter of Credit Issuer) shall result in any liability of Agent
or any such Lender to any Borrower as of the result of or in connection with
the issuance of any Letter of Credit, or relieve any Borrower of any of its
obligations hereunder to any such Person under any Letter of Credit.
(iv) Rights Against Letter of Credit Issuer. Nothing
contained in this Agreement is intended to limit or increase any Borrower's
rights, if any, with respect to a Letter of Credit Issuer which arise as a
result of the Issuing Bank Agreement, the letter of credit application and
related documents executed by and between such Borrower and a Letter of Credit
Issuer.
(v) Account Party. Each Borrower hereby authorizes and
directs any Letter of Credit Issuer to name such Borrower as the "account
party" therein and to deliver to the Agent all instruments, documents and other
writings and property received by such Letter of Credit Issuer pursuant to the
Letter of Credit, and to accept and rely upon the Agent's instructions and
agreements with respect to all matters arising in connection with the Letter of
Credit or the application therefor.
(g) Support of Letters of Credit. If, notwithstanding the
provisions of Section 1.4(b) and Section 10.1, any Letter of Credit is
outstanding 30 days prior to the termination of this Agreement, or upon such
termination of this Agreement, then each applicable Borrower shall cause such
letter of Credit to be Fully Supported.
(h) Letter of Credit Reporting. Each Letter of Credit Issuer
shall notify the Agent and the Agent shall notify the Lenders on the first
Business Day of each week of the total face amount of all of the Letters of
Credit issued by it on each Business Day of the preceding week.
1.5 Bank Products. Each Borrower may request and the Bank, the Bank's
Affiliates and each other Lender may, in its sole and absolute discretion,
arrange for such Borrower to obtain from the Bank, its Affiliates or such
Lender Bank Products, although such Borrower is not required to do so. If Bank
Products are provided by an Affiliate of the Bank to a Borrower, such Borrower
agrees to indemnify and hold harmless the Agent, the Bank and the other Lenders
from any and all costs and obligations now or hereafter incurred by the Agent,
the Bank or any of the Lenders which arise from any indemnity which shall not
extend to gross negligence or willful misconduct of such Affiliates given by
the Bank to its Affiliates related to such Bank Products; provided, however,
nothing contained in this Section 1.5 is intended to limit such Borrower's
rights with respect to any Lender, the Bank or its Affiliates, if any, which
arise as a result of the execution of documents by and between such Borrower
and a Lender or the Bank or its Affiliates which relate to Bank Products and to
the extent the terms of indemnity of such documents are different from the
terms of indemnity set forth above, the terms of such documents shall control;
and provided further, that nothing contained in this Section 1.5 is intended to
obligate any Lender, the Bank or its Affiliates or any Borrower to provide any
indemnity in connection with any Bank Products other than the indemnity of a
Borrower specifically provided for above. The agreement contained in this
Section shall survive termination of this Agreement. Each Borrower acknowledges
and agrees that the obtaining of Bank Products from a Lender, the Bank or the
Bank's Affiliates (a) is in the sole and absolute discretion of such Lender,
the Bank or the Bank's Affiliates, and (b) is subject to all rules and
regulations of such Lender, the Bank or the Bank's Affiliates.
1.6 Increase in Commitments
(a) Provided no Default or Event of Default exists, upon written
notice to the Agent (which shall promptly notify the Lenders), the Borrowers
may from time to time, request an increase in the Total Facility Amount and the
aggregate Commitments hereunder by an amount (for all such requests that are
satisfied) not exceeding $75,000,000. Such notice shall specify the time period
within which each Lender is requested to respond (which shall in no event be
less than ten (10) Business Days from the date of delivery of such notice to
the Lenders). Each Lender shall notify the Agent within such time period
whether or not it agrees to increase its Commitment and, if so, whether by an
amount equal to, greater than, or less than its Pro Rata Share of such
requested increase. Any Lender not responding within such time period shall be
deemed to have declined to increase its Commitment. No Lender declining to
increase its Commitment in connection with such a request shall be entitled to
fees, if any, paid in connection with such Commitment increase. The Agent shall
notify the Borrowers and each Lender of the Lenders' responses to each request
made hereunder. To achieve the full amount of a requested increase, the
Borrowers may also invite additional Eligible Assignees to become Lenders
pursuant to a joinder agreement in form and substance acceptable to the Agent
and subject to a $5,000,000 minimum Commitment amount for each such Eligible
Assignee.
(b) If the aggregate Commitments are increased in accordance
with this Section, the Agent and the Borrowers shall determine the effective
date (the "Increase Effective Date") and the final allocation of such increase.
The Agent shall promptly notify the Borrowers and the Lenders of the final
allocation of such increase and the Increase Effective Date. As a condition
precedent to such increase, the Borrowers shall deliver to the Agent a
certificate of each Credit Party dated as of the Increase Effective Date (in
sufficient copies for each Lender) signed by a Responsible Officer of such
Credit Party (i) certifying and attaching the resolutions adopted by such
Credit Party approving or consenting to such increase, and (ii) in the case of
the Borrowers, certifying that, before and after giving effect to such
increase, (A) the representations and warranties contained in Article 6 and the
other Loan Documents are true and correct on and as of the Extension Effective
Date, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
as of such earlier date, and except that for purposes of this Section 1.6, the
representations and warranties contained in subsection (a) of Section 6.6 shall
be deemed to refer to the most recent statements furnished pursuant to
subsections (a) and (b), of Section 5.2, and (B) no Default or Event of Default
exists. On the Increase Effective Date, Schedule 1.1 shall be deemed to be
deleted in its entirety and replaced with a new Schedule 1.1 reflecting the
increased Commitments. The respective Lenders shall fund and/or be pre-paid, as
applicable, any Loans outstanding on the Increase Effective Date (and the
Borrowers shall pay any additional amounts required pursuant to Section 4.4) to
the extent necessary to keep the outstanding Loans ratable with any revised Pro
Rata Shares arising from any non-ratable increase in the Commitments under this
Section.
(c) This Section shall supersede any provisions in Sections 11.1
to the contrary.
ARTICLE 2
INTEREST AND FEES
2.1 Interest.
(a) Interest Rates. All outstanding Obligations shall bear
interest on the unpaid principal amount thereof (including, to the extent
permitted by law, on interest thereon not paid when due) from the date made
until paid in full in cash at a rate determined by reference to the Base Rate
or the LIBOR Rate plus the Applicable Margins as set forth below, but not to
exceed the Maximum Rate. If at any time Loans are outstanding with respect to
which the applicable Borrower has not delivered to the Agent a notice
specifying the basis for determining the interest rate applicable thereto in
accordance herewith, those Loans shall bear interest at a rate determined by
reference to the Base Rate until notice to the contrary has been given to the
Agent in accordance with this Agreement and such notice has become effective.
Except as otherwise provided herein, the outstanding Obligations shall bear
interest as follows:
(i) For all Base Rate Loans (other than LIBOR Loans) at a
fluctuating per annum rate equal to the Base Rate plus the Applicable Margin;
and
(ii) For all LIBOR Loans at a per annum rate equal to the
LIBOR Rate plus the Applicable Margin.
Each change in the Base Rate shall be reflected in the interest rate
applicable to Base Rate Loans as of the effective date of such change. All
interest charges shall be computed on the basis of a year of 365 or 366 days,
as applicable, and actual days elapsed.
(b) Payment of Interest. The Borrowers shall pay to the Agent,
for the ratable benefit of Lenders, interest accrued on all Base Rate Loans in
arrears on the first day of each month hereafter and on the Termination Date.
The Borrowers shall pay to the Agent, for the ratable benefit of Lenders,
interest on all LIBOR Loans in arrears on each LIBOR Interest Payment Date.
(c) Default Rate. Notwithstanding the rates of interest
specified in Section 2.1(a) and the payment dates specified in Section 2.1(b),
effective at the direction of the Agent after the occurrence of any Event of
Default or after acceleration of maturity pursuant to Section 9.2(a) and for so
long thereafter as any such Event of Default or acceleration shall be
continuing, the principal balance of all Obligations then due and payable
(including all amounts due and payable pursuant to Section 9.2(a)), shall bear
interest payable upon demand at a rate which is 2% per annum in excess of the
rate of interest otherwise payable under this Agreement.
2.2 Continuation and Conversion Elections.
(a) Each Borrower may, except to the extent an Event of Default
has occurred and is continuing:
(i) elect, as of any Business Day, in the case of Base Rate
Loans to convert any Base Rate Loans (or any part thereof in an amount not less
than $1,000,000, or that is in an integral multiple of $1,000,000 in excess
thereof) into LIBOR Loans; or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any LIBOR Loans having Interest Periods expiring on such
day (or any part thereof in an amount not less than $1,000,000, or that is in
an integral multiple of $1,000,000 in excess thereof);
provided, that if at any time the aggregate amount of LIBOR Loans in respect
of any Borrowing is reduced, by payment, prepayment, or conversion of part
thereof to be less than $1,000,000, such LIBOR Loans shall automatically
convert into Base Rate Loans; provided further that if the notice shall fail
to specify the duration of the Interest Period, such Interest Period shall be
one month.
(b) The applicable Borrower shall deliver a notice of
continuation/conversion ("Notice of Continuation/Conversion") to the Agent not
later than 12:00 noon (New York City time) at least three (3) Business Days in
advance of the Continuation/Conversion Date, if the Loans are to be converted
into or continued as LIBOR Loans and specifying:
(i) the proposed Continuation/Conversion Date;
(ii) the aggregate amount of Loans to be converted or
renewed;
(iii) the type of Loans resulting from the proposed
conversion or continuation; and
(iv) the duration of the requested Interest Period,
provided, however, such Borrower may not select an Interest Period that ends
after the Stated Termination Date.
(c) If upon the expiration of any Interest Period applicable to
LIBOR Loans, the applicable Borrower has failed to select timely a new Interest
Period to be applicable to LIBOR Loans or if any Event of Default then exists,
such Borrower shall be deemed to have elected to convert such LIBOR Loans into
Base Rate Loans effective as of the expiration date of such Interest Period.
(d) The Agent will promptly notify each Lender of its receipt of
a Notice of Continuation/Conversion. All conversions and continuations shall be
made ratably according to the respective outstanding principal amounts of the
Loans with respect to which the notice was given held by each Lender.
(e) There may not be more than five (5) different LIBOR Loans in
effect hereunder at any time.
2.3 Maximum Interest Rate. In no event shall any interest rate
provided for hereunder exceed the maximum rate legally chargeable by any Lender
under applicable law for such Lender with respect to loans of the type provided
for hereunder (the "Maximum Rate"). If, in any month, any interest rate, absent
such limitation, would have exceeded the Maximum Rate, then the interest rate
for that month shall be the Maximum Rate, and, if in future months, that
interest rate would otherwise be less than the Maximum Rate, then that interest
rate shall remain at the Maximum Rate until such time as the amount of interest
paid hereunder equals the amount of interest which would have been paid if the
same had not been limited by the Maximum Rate. In the event that, upon payment
in full of the Obligations, the total amount of interest paid or accrued under
the terms of this Agreement is less than the total amount of interest which
would, but for this Section 2.3, have been paid or accrued if the interest rate
otherwise set forth in this Agreement had at all times been in effect, then
such Borrower shall, to the extent permitted by applicable law, pay the Agent,
for the account of the Lenders, an amount equal to the excess of (a) the lesser
of (i) the amount of interest which would have been charged if the Maximum Rate
had, at all times, been in effect or (ii) the amount of interest which would
have accrued had the interest rate otherwise set forth in this Agreement, at
all times, been in effect over (b) the amount of interest actually paid or
accrued under this Agreement. If a court of competent jurisdiction determines
that the Agent and/or any Lender has received interest and other charges
hereunder in excess of the Maximum Rate, such excess shall be deemed received
on account of, and shall automatically be applied to reduce, the Obligations
other than interest, and if there are no Obligations outstanding, the Agent
and/or such Lender shall refund to such Borrower such excess.
2.4 Closing Fee. The Borrowers agree, jointly and severally, to pay
the Agent on the Effective Date the fees (the "Closing Fees") payable on such
date as set forth in the fee letter dated September 15, 2003, between the Agent
and ATI (the "Fee Letter").
2.5 Unused Line Fee. On the first day of each month and on the
Termination Date the Borrowers agree, jointly and severally, to pay to the
Agent, for the account of the Lenders, in accordance with their respective Pro
Rata Shares, an unused line fee (the "Unused Line Fee") equal to the Applicable
Margin for the Unused Line Fee times the amount by which the Total Facility
Amount exceeded the sum of the average daily outstanding amount of Revolving
Loans and the average daily undrawn face amount of outstanding Letters of
Credit, during the immediately preceding month or shorter period if calculated
for the first month hereafter or on the Termination Date. The Unused Line Fee
shall be computed on the basis of a year of 365 or 366 days, as applicable, for
the actual number of days elapsed. All principal payments received by the Agent
shall be deemed to be credited to the applicable Borrower's Loan Account
immediately upon receipt for purposes of calculating the Unused Line Fee
pursuant to this Section 2.5.
2.6 Letter of Credit Fee. Each Borrower agrees (a) to pay to the Agent,
for the account of the Lenders, in accordance with their respective Pro Rata
Shares, (i) for each Commercial Letter of Credit issued for the account of such
Borrower, a fee (the "Commercial Letter of Credit Fee") at a per annum rate
equal to the Applicable Margin for the Commercial Letter of Credit Fee
multiplied by the maximum amount available to be drawn on such Commercial Letter
of Credit and (ii) for each Standby Letter of Credit issued for the account of
such Borrower, a fee (the "Standby Letter of Credit Fee") at a per annum rate
equal to the Applicable Margin for LIBOR Loans multiplied by the maximum amount
available to be drawn on such Standby Letter of Credit, (b) to pay to the
applicable Letter of Credit Issuer a fronting fee (the "Fronting Fee") of
one-eighth of one percent (.125%) of the undrawn face amount of each Letter of
Credit issued for the account of such Borrower, and (c) to pay to the applicable
Letter of Credit Issuer, such out-of-pocket costs, fees and expenses incurred by
the Letter of Credit Issuer in connection with the application for, processing
of, issuance of, or amendment to any Letter of Credit issued for the account of
such Borrower, as the applicable Letter of Credit Issuer and such Borrower shall
agree upon, but which costs, fees and expenses shall not include the Fronting
Fee. The Commercial Letter of Credit Fee and the Standby Letter of Credit Fee
shall be payable monthly in arrears on the first day of each month following any
month in which such a Letter of Credit is outstanding and on the Termination
Date. The Fronting Fee shall be payable on each date of issuance or renewal
(automatic or otherwise) of each Letter of Credit. All fees described in this
Section 2.6 shall be computed on the basis of a year of 365 or 366 days, as
applicable, for the actual number of days elapsed.
2.6 Letter of Credit Fee. Each Borrower agrees (a) to pay to the
Agent, for the account of the Lenders, in accordance with their respective Pro
Rata Shares, (i) for each Commercial Letter of Credit issued for the account of
such Borrower, a fee (the "Commercial Letter of Credit Fee") equal to the
Applicable Margin for the Commercial Letter of Credit Fee and (ii) for each
Standby Letter of Credit issued for the account of such Borrower, a fee (the
"Standby Letter of Credit Fee") equal to the Applicable Margin for LIBOR Loans,
(b) to pay to the Agent for the benefit of the applicable Letter of Credit
Issuer a fronting fee (the "Fronting Fee") of one-eighth of one percent (.125%)
of the undrawn face amount of each Letter of Credit issued for the account of
such Borrower, and (c) to pay to the applicable Letter of Credit Issuer, such
out-of-pocket costs, fees and expenses incurred by the Letter of Credit Issuer
in connection with the application for, processing of, issuance of, or
amendment to any Letter of Credit issued for the account of such Borrower, as
the applicable Letter of Credit Issuer and such Borrower shall agree upon, but
which costs, fees and expenses shall not include the Fronting Fee. The
Commercial Letter of Credit Fee and the Standby Letter of Credit Fee shall be
payable monthly in arrears on the first day of each month following any month
in which such a Letter of Credit is outstanding and on the Termination Date.
The Fronting Fee shall be payable on each date of issuance or renewal
(automatic or otherwise) of each Letter of Credit. All fees described in this
Section 2.6 shall be computed on the basis of a year of 365 or 366 days, as
applicable, for the actual number of days elapsed.
ARTICLE 3
PAYMENTS AND PREPAYMENTS
3.1 Revolving Loans. Each Borrower shall repay the outstanding
principal balance of the Revolving Loans made to it, plus all accrued but
unpaid interest thereon, on the Termination Date. Each Borrower may prepay
Revolving Loans made to it at any time, and reborrow subject to the terms of
this Agreement. In addition, and without limiting the generality of the
foregoing, upon demand by the Agent the Borrowers shall pay to the Agent, for
account of the Lenders, the amount, without duplication, by which the Aggregate
Outstandings exceeds the lesser of the Borrowing Base or the Total Facility
Amount.
3.2 Termination of Facility. The Borrowers may terminate this
Agreement upon at least five (5) Business Days' notice to the Agent and the
Lenders, upon (a) the payment in full of all outstanding Revolving Loans,
together with accrued interest thereon, and the cancellation and return of all
outstanding Letters of Credit or such Letters of Credit being Fully Supported,
(b) the payment in full in cash of all reimbursable expenses and other
Obligations, and (c) with respect to any LIBOR Loans prepaid, payment of the
amounts due under Section 4.4, if any, in each case on the Termination Date.
3.3 [Intentionally omitted.]
3.4 [Intentionally omitted.]
3.5 [Intentionally omitted.]
3.6 Payments by the Borrowers.
(a) All payments to be made by the Borrowers shall be made
without set-off, recoupment or counterclaim. Except as otherwise expressly
provided herein, all payments by the Borrowers shall be made to the Agent for
the account of the Lenders, at the account designated by the Agent and shall be
made in Dollars and in immediately available funds, no later than 12:00 noon
(New York City time) on the date specified herein. Any payment received by the
Agent after such time shall be deemed (for purposes of calculating interest
only) to have been received on the following Business Day and any applicable
interest shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period", whenever any payment is due on a day other than a Business
Day, such payment shall be due on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
(c) If any LIBOR Loans are repaid prior to the expiration date
of the Interest Period applicable thereto, the Borrowers shall pay to the
Lenders the amounts described in Section 4.4.
3.7 Payments as Revolving Loans. At the election of Agent, all
payments of principal, interest, reimbursement obligations in connection with
Letters of Credit, fees, premiums, reimbursable expenses and other sums payable
hereunder, may be paid from the proceeds of Revolving Loans made hereunder.
Each Borrower hereby irrevocably authorizes the Agent to charge the Loan
Account of such Borrower for the purpose of paying all amounts from time to
time due hereunder in respect of principal, interest or fees (or, during the
continuance of an Event of Default, all other Obligations) and agrees that all
such amounts charged shall constitute Revolving Loans.
3.8 Apportionment, Application and Reversal of Payments. Principal and
interest payments shall be apportioned ratably among the Lenders (according to
the unpaid principal balance of the Loans to which such payments relate held by
each Lender) and payments of the fees shall, as applicable, be apportioned
ratably among the Lenders, except for fees payable solely to Agent and the
Letter of Credit Issuers and except as provided in Section 11.1(b). All
payments shall be remitted to the Agent and all such payments not relating to
principal or interest of specific Loans, or not constituting payment of
specific fees, and all proceeds of Accounts or other Collateral received by the
Agent, shall be applied, ratably, subject to the provisions of this Agreement,
first, to pay any fees, indemnities or expense reimbursements and amounts due
under ACH Transactions and cash management or controlled disbursement services
then due to the Agent or any Lender providing ACH Transactions or cash
management or controlled disbursement services from any Credit Party; second,
to pay any fees or expense reimbursements then due to the Lenders from any
Credit Party; third, to pay interest due in respect of all Loans, including
Non-Ratable Loans and Agent Advances; fourth, to pay or prepay principal of the
Non-Ratable Loans and Agent Advances; fifth, to pay or prepay principal of the
Revolving Loans (other than Non-Ratable Loans and Agent Advances) and unpaid
reimbursement obligations in respect of Letters of Credit; sixth, to pay an
amount to the Agent equal to all outstanding Letter of Credit Obligations to be
held as cash collateral for such Obligations, solely, prior to the occurrence
of an Event of Default or acceleration of the Obligations hereunder, to the
extent such Letter of Credit Obligations exceed the Borrowing Base; seventh, to
the payment of any other Obligation due to the Agent, any Lender or any
Affiliate of the Bank by any Credit Party (including any Obligations arising
under Bank Products not otherwise already paid); and eighth, to the Borrowers
or as otherwise directed by a court of competent jurisdiction. Notwithstanding
anything to the contrary contained in this Agreement, unless so directed by the
Borrowers, or unless an Event of Default has occurred and is continuing,
neither the Agent nor any Lender shall apply any payments which it receives to
any LIBOR Loan, except (a) on the expiration date of the Interest Period
applicable to any such LIBOR Loan, or (b) in the event, and only to the extent,
that there are no outstanding Base Rate Loans. The Agent and the Lenders shall
have the continuing and exclusive right to apply and reverse and reapply any
and all such proceeds and payments to any portion of the Obligations in
accordance with the second sentence of this Section 3.8.
3.9 Indemnity for Returned Payments. If after receipt of any payment
which is applied to the payment of all or any part of the Obligations, the
Agent, any Lender, any Letter of Credit Issuer, the Bank or any Affiliate of
the Bank (each an "Affected Payee") is for any reason compelled to surrender
such payment or proceeds to any Person because such payment or application of
proceeds is invalidated, declared fraudulent, set aside, determined to be void
or voidable as a preference, impermissible setoff, or a diversion of trust
funds, or for any other reason, then the Obligations or part thereof intended
to be satisfied shall be revived and continued and this Agreement shall
continue in full force as if such payment or proceeds had not been received by
the Affected Payee and the applicable Borrower or Borrowers shall be liable to
pay to the Affected Payee, and hereby does indemnify the Affected Payee and
holds harmless the Affected Payee, for the amount of such payment or proceeds
surrendered. The provisions of this Section 3.9 shall be and remain effective
notwithstanding any contrary action which may have been taken by the Affected
Payee in reliance upon such payment or application of proceeds, and any such
contrary action so taken shall be without prejudice to the Affected Payee's
rights under this Agreement and shall be deemed to have been conditioned upon
such payment or application of proceeds having become final and irrevocable.
The provisions of this Section 3.9 shall survive the termination of this
Agreement.
3.10 Agent's and Lenders' Books and Records; Monthly Statements. The
Agent shall record the principal amount of the Loans owing to each Lender, the
undrawn face amount of all outstanding Letters of Credit and the aggregate
amount of unpaid reimbursement obligations outstanding with respect to the
Letters of Credit from time to time on its books. In addition, each Lender may
note the date and amount of each payment or prepayment of principal of such
Lender's Loans in its books and records. Failure by Agent or any Lender to make
such notation shall not affect the obligations of the Borrowers with respect to
the Loans or the Letters of Credit. Each Borrower agrees that the Agent's and
each Lender's books and records showing the Obligations and the transactions
pursuant to this Agreement and the other Loan Documents shall be admissible in
any action or proceeding arising therefrom, and shall constitute rebuttably
presumptive proof thereof (absent manifest error), irrespective of whether any
Obligation is also evidenced by a promissory note or other instrument. The
Agent will provide to ATI, on behalf of the Borrowers, a monthly statement of
Loans, payments, and other transactions pursuant to this Agreement. Such
statement shall be deemed presumptively correct, accurate, and binding on the
Borrowers and an account stated (except for reversals and reapplications of
payments made as provided in Section 3.8 and corrections of errors discovered
by the Agent), unless the Borrowers (or ATI on their behalf) notify the Agent
in writing to the contrary within thirty (30) days after such statement is
rendered. In the event a timely written notice of objections is given by a
Borrower (or ATI on behalf of such Borrower), only the items to which exception
is expressly made will be considered to be disputed by such Borrower.
ARTICLE 4
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes.
(a) Any and all payments by the Borrowers hereunder shall be
made, in accordance with Article 3, free and clear of and without deduction or
withholding for any Taxes. If any Borrower shall be required by law to deduct
or withhold any Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, (i) so long as such Lender or the Agent is in compliance
with Section 12.10, the sum payable shall be increased as may be necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 4.1) and withholding such Lender or
the Agent, as applicable, receives an amount equal to the sum it would have
received had no such deductions or withholding been made, (ii) such Borrower
shall make such deductions and withholding, and (iii) such Borrower shall pay
the full amount deducted or withheld to the relevant taxation authority or
other authority in accordance with applicable law. If a withholding tax of the
United States of America or any other Governmental Authority shall be or become
applicable (y) after the date of this Agreement, to such payments by the
Borrowers made to the applicable lending office or any other office that a
Lender may claim as its applicable lending office or (z) after such Lender's
selection and designation of any other applicable lending office, to such
payments made to such other applicable lending office, such Lender shall, in
good faith, use its reasonable best efforts to make, fund and maintain its
Loans, and to make, fund and maintain its Obligations under the Letters of
Credit, through another applicable lending office of such Lender in another
jurisdiction so as to reduce the Borrowers' liability hereunder, if the making,
funding or maintenance of such Loans or Obligations under the Letters of Credit
through such other applicable lending office of such Lender does not, in the
judgment of such Lender, otherwise materially adversely affect such Loans,
Obligations under the Letters of Credit or such Lender.
(b) In addition, each Borrower agrees to pay any Other Taxes.
(c) Each Borrower will indemnify each Lender and the Agent for
the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes
imposed by any Governmental Authority on amounts payable under this Section
4.1) paid by such Lender or the Agent, as applicable, and any liability
(including penalties, interest, additions to tax and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other Taxes
were correctly or legally asserted by such Governmental Authority. Payment
under this indemnification shall be made within 30 days after the date such
Lender or the Agent, as applicable, makes written demand therefor. A
certificate as to any additional amount payable to any Lender under this
Section 4.1 submitted to such Borrower and the Agent (if a Lender is so
submitting) by such Lender or the Agent shall show in reasonable detail the
amount payable and the calculations used to determine such amount and shall,
absent manifest error, be final, conclusive and binding upon all parties
hereto. Each Lender agrees that, to the extent that such Lender is entitled to
claim an exemption in respect of all or a portion of any Taxes which are
otherwise required to be paid or deducted or withheld pursuant to this Section
4.1 in respect of any payments under this Agreement such Lender shall within a
reasonable time after receiving written request by such Borrower provide such
Borrower with such certificates as Lender in good faith may deem appropriate to
obtain the benefits of such exemption.
(d) Within 30 days after the date of any payment of Taxes or
Other Taxes by a Borrower, such Borrower will furnish to the Agent, at its
address referred to in Section 14.8, the original or a certified copy of a
receipt evidencing payment thereof.
(e) No Borrower shall be required to indemnify any Lender that
is not a "United States person" within the meaning of Section 7701(a)(30) of
the Code ("Non-U.S. Lender"), or to pay any additional amounts to any Non-U.S.
Lender, in respect of any Taxes (and any penalties, interest and expenses
arising therefrom or with respect thereto) pursuant to paragraph (a) or (c)
above to the extent that payments made pursuant to this Agreement to such
Non-U.S. Lender were subject to such Taxes on the date such Non-U.S. Lender
became a party to this Agreement (or, in the case of a Participant, on the date
such Participant became a transferee of a participation interest hereunder) or,
with respect to payments to an Assignee, the date such Non-U.S. Lender
designated assigned such a Loan to such Assignee. (f) If the Agent or any
Lender receives a refund, which in the good faith judgment of such Lender is
allocable to Taxes or Other Taxes paid by any Borrower, it shall promptly pay
such refund to such Borrower, net of all out-of-pocket expenses of such Lender
incurred in obtaining such refund, provided, however, that such Borrower agrees
to promptly return such refund to the Agent or the applicable Lender, as
applicable, if it receives notice from the Agent or the applicable Lender that
such Agent or Lender is required to repay such refund. In addition, the Lender
shall take such steps as the applicable Borrower shall reasonably request to
recover or assist such Borrower in recovering any Taxes or Other Taxes paid by
such Borrower pursuant to paragraph (a) or (c) above.
(g) Without prejudice to the survival of any other agreement of
the Borrowers hereunder, the agreements and obligations of the Borrowers
contained in this Section 4.1 shall survive the payment in full of principal
and interest hereunder, the termination of the Letters of Credit and the
termination of this Agreement.
(h) The Borrowers shall not be obligated to pay any additional
amounts in respect of United States federal income tax (or make an
indemnification payment) pursuant to this Section 4.1 to any Lender (including,
without limitation, any entity to which any Lender sells, assigns, grants a
participation in, or otherwise transfers its rights under this Agreement) if
the obligation to pay such additional amounts (or such indemnification) would
not have arisen but for a failure of such Lender to comply with its obligations
under Section 12.10.
4.2 Illegality.
(a) If after the date of this Agreement the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Lender or its applicable lending office to make
LIBOR Loans, then, on notice thereof by that Lender to the Borrowers (or ATI on
behalf of the Borrowers) through the Agent, any obligation of that Lender to
make LIBOR Loans shall be suspended until that Lender notifies the Agent and
the Borrowers (or ATI on behalf of the Borrowers) that the circumstances giving
rise to such determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
LIBOR Loan, each Borrower shall, upon its receipt of notice of such fact and
demand from a Lender (with a copy to the Agent), prepay in full such LIBOR
Loans of that Lender then outstanding, together with interest accrued thereon
and amounts required under Section 4.4, either on the last day of the Interest
Period thereof, if that Lender may lawfully continue to maintain such LIBOR
Loans to such day, or immediately, if that Lender may not lawfully continue to
maintain such LIBOR Loans. If a Borrower is required to so prepay any LIBOR
Loans, then concurrently with such prepayment, such Borrower shall borrow from
the affected Lender, in the amount of such repayment, a Base Rate Loan.
4.3 Increased Costs and Reduction of Return.
(a) If any Lender determines that due to either (i) the
introduction of or any change in the interpretation of any law or regulation
after the date of this Agreement or (ii) the compliance by that Lender with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in the
cost (excluding in each case for purposes of this Section 4.3(a), any such
increased costs resulting from Taxes or Other Taxes, as to which Section 4.1
shall govern) to such Lender of agreeing to make or making, funding or
maintaining any LIBOR Loans, then the applicable Borrower shall be liable for,
and shall from time to time, upon demand (with a copy of such demand to be sent
to the Agent), pay to the Agent for the account of such Lender, additional
amounts as are sufficient to compensate such Lender for such increased costs.
(b) If any Lender shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or administration
of any Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by such Lender or any corporation or other entity controlling such
Lender with any Capital Adequacy Regulation, affects or would affect the amount
of capital required or expected to be maintained by such Lender or any
corporation or other entity controlling such Lender and (taking into
consideration such Lender's or such corporation's or other entity's policies
with respect to capital adequacy and such Lender's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitments, loans, credits or obligations under this Agreement, then, upon
demand of such Lender to the applicable Borrower through the Agent, such
Borrower shall pay to such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender for such
increase.
4.4 Funding Losses. Each Borrower shall reimburse each Lender and hold
each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of:
(a) the failure of such Borrower to make on a timely basis any
payment of principal of any LIBOR Loan;
(b) the failure of such Borrower to borrow, continue or convert
a Loan after such Borrower has given (or is deemed to have given) a Notice of
Borrowing or a Notice of Continuation/Conversion; or
(c) the prepayment or other payment (including after
acceleration thereof) of any LIBOR Loans on a day that is not the last day of
the relevant Interest Period;
including any expense arising from the liquidation or reemployment of funds
obtained by it to maintain its LIBOR Loans or from fees payable to terminate
the deposits from which such funds were obtained. Each Borrower shall also pay
any customary administrative fees charged by any Lender in connection with the
foregoing.
4.5 Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the LIBOR
Rate for any requested Interest Period with respect to a proposed LIBOR Loan,
or that the LIBOR Rate for any requested Interest Period with respect to a
proposed LIBOR Loan does not adequately and fairly reflect the cost to the
Lenders of funding such Loan, the Agent will promptly so notify the Borrowers
(or ATI on behalf of the Borrowers) and each Lender (a "Rate Suspension
Notice"). Upon receipt of such Rate Suspension Notice, a Borrower may revoke
any Notice of Borrowing or Notice of Continuation/Conversion then submitted by
it. If such Borrower does not revoke such Notice of Borrowing or Notice of
Continuation/Conversion, the Lenders shall make, convert or continue the Loans,
as proposed by such Borrower, in the amount specified in the applicable notice
submitted by such Borrower, but such Loans shall be made, converted or
continued as Base Rate Loans instead of LIBOR Loans. After the giving of any
Rate Suspension Notice and until Agent shall otherwise notify the Borrowers (or
ATI on behalf of the Borrowers) and the Lenders in writing that the
circumstances giving rise to such condition no longer exist, the Borrowers'
right to request the making of or conversion to, and the Lenders' obligations
to make or convert to, LIBOR Rate Loans shall be suspended. Any LIBOR Rate
Loans outstanding at the commencement of any such suspension shall be converted
at the end of the then current Interest Period for such Loans into Base Rate
Loans unless such suspension has then ended or LIBOR Rate Loans for another
Interest Period are then available.
4.6 Certificates of Agent. If any Lender claims reimbursement or
compensation under this Article 4, Agent shall verify the amount thereof and
shall deliver to the Borrowers (or ATI on behalf of the Borrowers) (with a copy
to the affected Lender) a certificate setting forth in reasonable detail the
amount payable to the affected Lender, and such certificate shall be conclusive
and binding on the Borrowers in the absence of manifest error.
4.7 Survival. The agreements and obligations of the Borrowers in this
Article 4 shall survive the payment of all other Obligations.
4.8 Replacement of Lenders. (a) If and with respect to each occasion
that a Lender other than the Agent either makes a demand for compensation
pursuant to Sections 4.1 or 4.3 or is unable to fund LIBOR Rate Loans pursuant
to Section 4.2 or such Lender is a Defaulting Lender, the Borrowers may, upon
at least five (5) Business Days' prior irrevocable written notice to each of
such Lender and Agent, in whole permanently replace the Commitment of such
Lender; provided that (i) no Event of Default has occurred and is continuing at
the time of such proposed replacement of the Commitment of such Lender, and
(ii) the Borrowers shall replace such Commitment with the Commitment of a
financial institution reasonably satisfactory to Agent (and such consent of the
Agent shall not be unreasonably withheld or delayed). Such replacement Lender
shall upon the effective date of replacement purchase the Loans owed to such
replaced Lender for the aggregate amount thereof and shall thereupon for all
purposes become a "Lender" hereunder. Such notice from the Borrowers shall
specify an effective date for the replacement of such Lender's Commitment,
which date shall not be later than the thirtieth (30th) day after the day such
notice is given. On the effective date of any replacement of such Lender's
Commitment pursuant to this Section 4.9, the Borrowers shall pay to Agent for
the account of such Lender (a) any fees due to such Lender to the date of such
replacement; (b) accrued interest on the principal amount of outstanding Loans
held by such Lender to the date of such replacement, and (c) the amount or
amounts requested by such Lender pursuant to Article 4. On or before the
effective date for the replacement of such Lender's Commitment, the Borrowers
will cause any Letter of Credit issued by such replaced Lender to be terminated
or transferred to the replacement Lender or to another Lender. Upon the
effective date of repayment of any Lender's Loans, the termination or transfer
of such Lender's Letters of Credit and termination of such Lender's Commitment
pursuant to this Section 4.9, such Lender shall cease to be a Lender hereunder.
No such termination of any such Lender's Commitment and the purchase of such
Lender's Loans and termination or transfer of such Lender's Letters of Credit
pursuant to this Section 4.9 shall affect (i) any liability or obligation of
the Borrowers or any other Lender to such terminated Lender which accrued on or
prior to the date of such termination or which by the terms of this Agreement
expressly survive termination hereof or (ii) such terminated Lender's rights
hereunder in respect of any such liability or obligation.
ARTICLE 5
BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES
5.1 Books and Records. Each Borrower shall, and shall cause its
Subsidiaries to, maintain, at all times, correct and complete books, records
and accounts in which complete, correct and timely entries are made of its
transactions in accordance with GAAP applied consistently with the audited
Financial Statements required to be delivered pursuant to Section 5.2(a). Each
Borrower shall, and shall cause its Subsidiaries to, by means of appropriate
entries, reflect in such accounts and in all Financial Statements proper
liabilities and reserves for all taxes and proper provision for depreciation
and amortization of property and bad debts, all in accordance with GAAP. Each
Borrower shall, and shall cause its Restricted Subsidiaries to, maintain at all
times books and records pertaining to the Collateral in such detail, form and
scope as the Agent shall reasonably require, including, but not limited to,
records of (a) all payments received and all credits and extensions granted
with respect to the Accounts; (b) the return, rejection, repossession, stoppage
in transit, loss, damage, or destruction of any Inventory; and (c) all other
dealings affecting the Collateral.
5.2 Financial Information. Each Borrower shall, and shall cause its
Subsidiaries to, promptly furnish to each Lender, all such financial
information as the Agent shall reasonably request. Without limiting the
foregoing, each Borrower will furnish to the Agent, in sufficient copies for
distribution by the Agent to each Lender, in such detail as the Agent or the
Lenders shall reasonably request, the following:
(a) As soon as available, but in any event not later than ninety
(90) days after the close of each Fiscal Year, a consolidated audited balance
sheet, income statement, cash flow statement and statement of change in
stockholders' equity for the Parent and its Subsidiaries for such Fiscal Year,
and the accompanying notes thereto, setting forth in each case in comparative
form figures for the previous Fiscal Year, all in reasonable detail, fairly
presenting the financial position and the results of operations of the Parent
and its consolidated Subsidiaries as at the date thereof and for the Fiscal
Year then ended, and prepared in accordance with GAAP. Such statements shall be
examined in accordance with generally accepted auditing standards by and, in
the case of such statements performed on a consolidated basis, accompanied by a
report thereon unqualified in any respect of independent certified public
accountants selected by the Borrowers and reasonably satisfactory to the Agent.
Each Borrower hereby authorizes the Agent to communicate directly with its
certified public accountants and, by this provision, authorizes those
accountants to disclose to the Agent any and all financial statements and other
supporting financial documents and schedules relating to such Borrower and to
discuss directly with the Agent the finances and affairs of such Borrower;
provided, however, the Agent shall give ATI not less than five (5) days prior
written notice of any such communication, disclosure or discussion and nothing
in this Section 5.2(a) shall limit the right of any of the Borrowers to be
present during any such discussions.
(b) As soon as available, but in any event not later than
forty-five (45) days after the end of each fiscal quarter (other than the last
fiscal quarter of any Fiscal Year), a consolidated unaudited balance sheet as
of the end of such period, income statement and cash flow statement for the
Parent and its consolidated Subsidiaries for such fiscal quarter and for the
period from the beginning of the Fiscal Year to the end of such fiscal quarter,
all in reasonable detail, fairly presenting the financial position and results
of operations of the Parent and its consolidated Subsidiaries as at the date
thereof and for such periods, and in each case in comparable form, figures for
the corresponding period in the prior Fiscal Year, and prepared in accordance
with GAAP applied consistently with the audited Financial Statements required
to be delivered pursuant to Section 5.2(a) (subject to normal year-end
adjustments), together with a report identifying all Unrestricted Subsidiaries;
provided, however, if Liquidity shall be less than $100,000,000 at any time,
the Financial Statements described in this Section 5.2(b) shall thereafter
(until Liquidity is more than $100,000,000 for 90 consecutive days) be provided
monthly no later than 30 days after the end of each month and be prepared on a
monthly basis. Each Borrower shall certify by a certificate signed by a
Responsible Officer that all such statements have been prepared in accordance
with GAAP and present fairly the Parent's and its Subsidiaries consolidated
financial position as at the dates thereof and its results of operations for
the periods then ended, subject to normal year-end adjustments.
(c) With each of the audited Financial Statements delivered
pursuant to Section 5.2(a), a certificate of the independent certified public
accountants that examined such statement to the effect that they have reviewed
and are familiar with this Agreement and that, in examining such Financial
Statements, they did not become aware of any fact or condition which then
constituted a Default or Event of Default with respect to a financial covenant,
except for those, if any, described in reasonable detail in such certificate.
(d) Within forty-five (45) days after the end of each fiscal
quarter, a certificate of a Responsible Officer of ATI in the form of Exhibit A
hereto setting forth in reasonable detail the calculations required to
establish that the Borrowers were in compliance with the applicable covenants
set forth therein at the end of such fiscal quarter, and stating that, except
as explained in reasonable detail in such certificate, (i) all of the
representations and warranties of the Borrowers contained in this Agreement and
the other Loan Documents are correct and complete in all material respects as
at the date of such certificate as if made at such time, except for those that
speak as of a particular date, (ii) the Borrowers are, at the date of such
certificate, in compliance in all material respects with all of their
respective covenants and agreements in this Agreement and the other Loan
Documents, (iii) no Default or Event of Default then exists, and (iv) no
Illiquidity Period has arisen or been in effect during such fiscal quarter, and
setting forth in reasonable detail a calculation of Liquidity as of the end of
such fiscal quarter; provided, however, that the confirmation of the
representations and warranties in clause (i) above is solely for purposes of
supplemental disclosure and shall not be considered a making or a deemed making
of such representations and warranties for the purpose of Section 9.1(b) or
otherwise. If such certificate discloses that a representation or warranty is
not correct or complete, or that a covenant has not been complied with, or that
a Default or Event of Default existed or exists, such certificate shall set
forth what action the Borrowers have taken or proposes to take with respect
thereto.
(e) Within fifteen (15) days after the end of each month during
which any portion of an Illiquidity Period shall be in effect, a certificate of
a Responsible Officer of ATI in the form of Exhibit A hereto setting forth in
reasonable detail the calculations required to establish that the Borrowers
were in compliance with the covenant set forth in Section 7.24 at the end of
such month.
(f) Within forty-five (45) days after the end of each Fiscal
Year, annual forecasts (to include a forecasted consolidated balance sheet,
income statement and cash flow statement) for the Parent and its Subsidiaries
as at the end of and for each fiscal quarter of such Fiscal Year.
(g) Upon request of the Agent, copies of all reports on Forms
10-Q or 10-K and definitive proxy statements filed by the Parent or any of its
Subsidiaries with the SEC under the Exchange Act.
(h) As soon as available, but in any event not later than 15
days after any Borrower's receipt thereof, a copy of each annual management
report prepared for the Parent or any Borrower by any independent certified
public accountants.
(i) Upon request of the Agent, copies of any and all proxy
statements, financial statements, and reports which the Parent makes available
to its shareholders.
(j) Upon request of the Agent, within 30 days after filing with
the IRS, a copy of each federal income tax return filed by the Parent or by any
of its Subsidiaries.
(k) Within fifteen (15) days following the end of each month, a
Borrowing Base Certificate for such month, together with a detailed calculation
of Eligible Accounts, Eligible Inventory, Eligible Equipment and Eligible Real
Estate and a reconciliation to the corresponding Borrowing Base and to the
Borrowers' general ledger; provided, however, if Liquidity shall at any time be
less than $100,000,000, the Borrowing Base Certificate shall be accompanied by
(i) a schedule of Eligible Accounts; (ii) an aging of Accounts, together with a
reconciliation to the corresponding Borrowing Base and to the Borrowers'
general ledger; (iii) an aging of all Borrowers' accounts payable; (iv)
Inventory reports by category and location, together with a reconciliation to
the corresponding Borrowing Base and to the Borrowers' general ledger; (v) such
other reports as to the Collateral as the Agent shall reasonably request from
time to time; and (vi) with the delivery of each of the foregoing, a
certificate of a Responsible Officer of ATI certifying as to the accuracy and
completeness of the foregoing; provided further, however, if Liquidity shall at
any time be less than $50,000,000, the Borrowing Base Certificate and, to the
extent requested by the Agent, other information described in this Section
5.2(k) shall thereafter be provided weekly. Notwithstanding the foregoing, if
an Event of Default shall have occurred and be continuing, the documents and
information required to be provided under this Section 5.2(k) shall be provided
on a more frequent basis than set forth herein if and as requested by the
Agent. If records or reports of the Collateral of type required to be delivered
hereunder are prepared by an accounting service or other agent, each Borrower
hereby authorizes such service or agent to deliver such records, reports, and
related documents (but only to the extent necessary to satisfy the foregoing
reporting requirements) to the Agent, for distribution to the Lenders; provided
however, the Agent shall give written notice to ATI not less than five (5) days
prior to any such contact with such accounting service or agent.
(l) Promptly after a Borrower has notified the Agent of any
intention by such Borrower to treat the Loans and/or Letters of Credit and
related transactions as being a "reportable transaction" (within the meaning of
Treasury Regulation Section 1.6011-4), a duly completed copy of IRS Form 8886
or any successor form.
(m) Such additional information as the Agent and/or any Lender
may from time to time reasonably request regarding the financial and business
affairs of the Parent, the Borrowers or any Subsidiary.
5.3 Notices to the Lenders. ATI shall notify the Agent in writing of
the following matters at the following times:
(a) As promptly as practicable but no later than three (3)
Business Days after any Borrower becomes aware (i) of any Default or Event of
Default, (ii) that Liquidity has become less than $100,000,000, $50,000,000,
$35,000,000 or $30,000,000 or (iii) the commencement of any Illiquidity Period;
(b) As promptly as practicable but no later than three (3)
Business Days after any Borrower becomes aware of any event or circumstance
which could reasonably be expected to have a Material Adverse Effect;
(c) As promptly as practicable but no later than three (3)
Business Days after any Borrower becomes aware of any pending or threatened
action, suit, or proceeding, by any Person, or any pending or threatened
investigation by a Governmental Authority, which could reasonably be expected
to have a Material Adverse Effect;
(d) As promptly as practicable but no later than three (3)
Business Days after any Borrower becomes aware of any pending or threatened
strike, work stoppage, unfair labor practice claim, or other labor dispute
affecting the Parent, any Borrower or any of its Subsidiaries in a manner which
could reasonably be expected to have a Material Adverse Effect;
(e) As promptly as practicable but no later than three (3)
Business Days after any Borrower becomes aware of any violation of any law,
statute, regulation, or ordinance of a Governmental Authority by the Parent,
any Borrower or any Subsidiary which could reasonably be expected to have a
Material Adverse Effect;
(f) As promptly as practicable but no later than three (3)
Business Days after receipt of any notice of any violation by the Parent, any
Borrower or any of its Subsidiaries of any Environmental Law which could
reasonably be expected to have a Material Adverse Effect or that any
Governmental Authority has asserted in writing that the Parent, any Borrower or
any Subsidiary is not in compliance with any Environmental Law or is
investigating the Parent, any Borrower's or such Subsidiary's compliance
therewith to the extent any such non-compliance or investigation could
reasonably be expected to have a Material Adverse Effect;
(g) As promptly as practicable but no later than three (3)
Business Days after receipt of any written notice that the Parent, any Borrower
or any of its Subsidiaries is or may be liable to any Person as a result of the
Release or threatened Release of any Contaminant or that the Parent, any
Borrower or any Subsidiary is subject to investigation by any Governmental
Authority evaluating whether any remedial action is needed to respond to the
Release or threatened Release of any Contaminant which, in either case, is
reasonably likely to give rise to liability in excess of $5,000,000;
(h) As promptly as practicable but no later than three (3)
Business Days after receipt of any written notice of the imposition of any
Environmental Lien against any property of the Parent, any Borrower or any of
its Subsidiaries;
(i) At least thirty (30) days prior to any change in (i) any
Credit Party's name as it appears in the state of its incorporation or other
organization, or (ii) any Credit Party's state of incorporation or
organization, type of entity or form of organization, organizational
identification number, or trade names under which any Borrower will sell
Inventory or create Accounts or to which instruments in payment of Accounts may
be made payable;
(j) Within ten (10) Business Days after any Borrower or any
ERISA Affiliate knows or has reason to know, that an ERISA Event or a
prohibited transaction (as defined in Sections 406 of ERISA and 4975 of the
Code) has occurred, and, when known, any action taken or threatened by the IRS,
the DOL or the PBGC with respect thereto;
(k) Upon request, or, in the event that such filing reflects a
significant change with respect to the matters covered thereby which could
reasonably be expected to have a Material Adverse Effect, within ten (10)
Business Days after the filing thereof with the PBGC, the DOL or the IRS, as
applicable, copies of the following: (i) each annual report (form 5500 series),
including Schedule B thereto, filed with the PBGC, the DOL or the IRS with
respect to each Plan, (ii) a copy of each funding waiver request filed with the
PBGC, the DOL or the IRS with respect to any Plan and all communications
received by the Parent, any Borrower or any ERISA Affiliate from the PBGC, the
DOL or the IRS with respect to such request, and (iii) a copy of each other
filing or notice filed with the PBGC, the DOL or the IRS, with respect to each
Plan by the Parent, any Borrower or any ERISA Affiliate;
(l) Upon request, copies of each actuarial report for any Plan
or Multi-employer Plan and annual report for any Multi-employer Plan; and
within ten (10) Business Days after receipt thereof by any Borrower or any
ERISA Affiliate, copies of the following: (i) any notices of the PBGC's
intention to terminate a Plan or to have a trustee appointed to administer such
Plan; (ii) any unfavorable determination letter from the IRS regarding the
qualification of a Plan under Section 401(a) of the Code; or (iii) any notice
from a Multi-employer Plan regarding the imposition of withdrawal liability;
(m) Within ten (10) Business Days after the occurrence thereof:
(i) any changes in the benefits of any existing Plan which increase any
Borrower's annual costs with respect thereto by an amount in excess of
$5,000,000, or the establishment of any new Plan or the commencement of
contributions to any Plan to which any Borrower or any ERISA Affiliate was not
previously contributing; or (ii) any failure by any Borrower or any ERISA
Affiliate to make a required installment or any other required payment under
Section 412 of the Code on or before or within ten (10) days after the due date
for such installment or payment; or
(n) Within ten (10) Business Days after any Borrower or any
ERISA Affiliate knows or has reason to know that any of the following events
has or will occur: (i) a Multi-employer Plan has been or will be terminated;
(ii) the administrator or plan sponsor of a Multi-employer Plan intends to
terminate a Multi-employer Plan; or (iii) the PBGC has instituted or will
institute proceedings under Section 4042 of ERISA to terminate a Multi-employer
Plan.
Each notice given under this Section shall describe the subject matter
thereof in reasonable detail, and, to the extent applicable, shall set forth
the action that the Parent, such Borrower, its Subsidiaries, or any ERISA
Affiliate, as applicable, has taken or proposes to take with respect thereto.
ARTICLE 6
GENERAL WARRANTIES AND REPRESENTATIONS
Each Borrower warrants and represents to the Agent and the Lenders
that except as hereafter disclosed to and accepted by the Agent and the
Required Lenders in writing:
6.1 Authorization, Validity, and Enforceability of this Agreement and
the Loan Documents. Each Credit Party has the power and authority to execute,
deliver and perform each of the Loan Documents to which it is a party, to incur
the Obligations hereunder or under the Parent Guaranty, as applicable, and to
grant to the Agent Liens upon and security interests in the Collateral. Each
Credit Party has taken all necessary action (including obtaining approval of
its stockholders or other equityholders, if necessary) to authorize its
execution, delivery, and performance of the Loan Documents to which it is a
party. The Loan Documents (other than those not required to be in effect on the
date of this representation) to which it is a party have been duly executed and
delivered by each Credit Party, and constitute the legal, valid and binding
obligations of each Credit Party, enforceable against it in accordance with
their respective terms, except to the extent that enforceability may be limited
by applicable bankruptcy, insolvency, moratorium, reorganization or other
similar laws affecting the enforcement of creditors' rights or by the effect of
general equitable principles. Each Credit Party's execution, delivery, and
performance of the Loan Documents to which it is a party do not and will not
conflict with, or constitute a violation or breach of, or result in the
imposition of any Lien upon the property of each Credit Party or any of its
Subsidiaries, by reason of the terms of (a) any material contract, mortgage,
lease, agreement, indenture, or instrument to which any Borrower is a party or
which is binding upon it, (b) any Requirement of Law applicable to any Credit
Party or any of its Subsidiaries, or (c) the certificate or articles of
incorporation or by-laws or the limited liability company or limited
partnership agreement of any Credit Party or any of its Subsidiaries.
6.2 Validity and Priority of Security Interest. The provisions of this
Agreement, and the other Loan Documents create legal and valid Liens on all the
Collateral in favor of the Agent, for the ratable benefit of the Agent and the
Lenders, and such Liens constitute perfected and continuing Liens on all the
Collateral, having priority over all other Liens on the Collateral, except for
those Liens identified in clauses (a), (b), (c) and (d) of the definition of
Permitted Liens securing all the Obligations, and enforceable against each
Credit Party and all third parties. All of the Obligations of the Borrowers
hereunder shall constitute "Guarantor Senior Indebtedness" and the Obligations
of the Parent under the Parent Guaranty shall constitute "Senior Indebtedness,"
in each case, under and as defined in the Convertible Debenture Indenture.
6.3 Organization and Qualification. Each Credit Party (a) is duly
organized or incorporated and validly existing in good standing under the laws
of the state of its organization or incorporation, (b) is qualified to do
business and is in good standing in each jurisdiction in which qualification is
necessary in order for it to own or lease its property and conduct its
business, except to the extent any such failure to be so qualified would not
have a Material Adverse Effect on such Credit Party and (c) has all requisite
power and authority to conduct its business and to own its property.
6.4 Corporate Name; Prior Transactions. No Credit Party has, during
the past five (5) years, been known by or used any other corporate or
fictitious name other than AnnTaylor & Company, or been a party to any merger
or consolidation, or acquired all or substantially all of the assets of any
Person, or acquired any of its property outside of the ordinary course of
business.
6.5 Subsidiaries and Affiliates. Schedule 6.5 is a correct and
complete list of the name and relationship to the Parent of each and all of the
Parent's Subsidiaries and other Affiliates as of the Effective Date.
6.6 Financial Statements and Projections.
(a) ATI has delivered to the Agent and the Lenders the audited
balance sheet and related statements of income, retained earnings, cash flows,
and changes in stockholders equity for the Parent and its consolidated
Subsidiaries as of February 1, 2003, and for the Fiscal Year then ended,
accompanied by the report thereon of its independent certified public
accountants, Deloitte & Touche LLC. ATI has also delivered to the Agent and the
Lenders the unaudited balance sheet and related statements of income and cash
flows for the Parent and its consolidated Subsidiaries as of August 2, 2003.
Such financial statements are attached hereto as Exhibit C. All such financial
statements have been prepared in accordance with GAAP (subject to normal
year-end adjustments) and present accurately and fairly in all material
respects the financial position of the Parent and its consolidated Subsidiaries
as at the dates thereof and their results of operations for the periods then
ended.
(b) The Latest Projections when submitted to the Lenders as
required herein represent the Borrowers' best estimate of the future financial
performance of the Parent and its consolidated Subsidiaries for the periods set
forth therein and the Latest Projections have been prepared on the basis of the
assumptions set forth therein, which the Borrowers believe are fair and
reasonable in light of current and reasonably foreseeable business conditions
at the time submitted to the Lenders (it being understood that the forecasts
and forward looking statements are subject to significant uncertainties and
contingencies, many of which are beyond the Borrowers' control and that no
guaranty can be given that the Latest Projections will be realized as further
described in the Parent's SEC filings).
6.7 Capitalization. The authorized capital stock of each Subsidiary
(other than Subsidiaries of AnnTaylor Sourcing Far East) of the Parent is set
forth on Schedule 6.7 and all such shares are validly issued and outstanding,
fully paid and non-assessable and are owned beneficially and of record as set
forth in Schedule 6.7 hereto.
6.8 Solvency. Each of (a) the Parent and its Subsidiaries on a
consolidated basis are, and (b) each Borrower is, Solvent prior to and after
giving effect to the Borrowings to be made on the Effective Date and the
issuance of the Letters of Credit to be issued on the Effective Date, and shall
remain Solvent during the term of this Agreement.
6.9 Debt. After giving effect to the making of the Revolving Loans to
be made on the Effective Date, the Parent and its Subsidiaries have no Debt,
except (a) the Obligations, and (b) Debt described on Schedule 6.9.
6.10 Distributions. Except as set forth on Schedule 6.10, since
February 1, 2003, no Restricted Payment has been declared, paid, or made upon
or in respect of any capital stock or other securities of the Parent or any
Borrower.
6.11 Real Estate; Store Locations. Schedule 6.11 sets forth, as of the
Effective Date, a correct and complete list of all Real Estate owned by the
Parent and the Borrowers and all store locations operated by the Parent and the
Borrowers. As of the Effective Date, each material lease and sublease of the
Parent and the Borrowers is valid and enforceable in accordance with its terms
and is in full force and effect, and no material default by any Credit Party
party to any such lease or sublease exists. As of the Effective Date, the
Parent and each Borrower has good and marketable title in fee simple to its
owned Real Estate, or valid leasehold interests in all material leasehold
properties and the Parent and each the Borrower has good, indefeasible, and
merchantable title to all of its other property reflected on the February 1,
2003 Financial Statements delivered to the Agent and the Lenders, except as
disposed of in the ordinary course of business since the date thereof, free of
all Liens except Permitted Liens.
6.12 [Intentionally Omitted].
6.13 Trade Names. All material trade names or styles under which any
Borrower will create Accounts in the United States, or to which instruments in
payment of Accounts may be made payable, are listed on Schedule 6.13.
6.14 Litigation. Except as set forth on Schedule 6.14, there is no
pending, or to the best of each Borrower's knowledge threatened, action, suit,
proceeding, or counterclaim by any Person, or to the best of each Borrower's
knowledge, investigation by any Governmental Authority, which could reasonably
be expected to have a Material Adverse Effect.
6.15 Labor Disputes. Except as to matters that could not reasonably be
expected to have a Material Adverse Effect, as of the Effective Date (a) there
is no collective bargaining agreement or other labor contract covering
employees of the Credit Parties, (b) no such collective bargaining agreement or
other labor contract is scheduled to expire during the term of this Agreement,
(c) no union or other labor organization is seeking to organize, or to be
recognized as, a collective bargaining unit of employees of the Credit Parties
or for any similar purpose, and (d) there is no pending or (to the best of each
Borrower's knowledge) threatened, strike, work stoppage, material unfair labor
practice claim, or other material labor dispute against or affecting the Credit
Parties or their employees that could reasonably be expected to have a Material
Adverse Effect.
6.16 Environmental Laws. Except for matters that could not reasonably
be expected to have a Material Adverse Effect or as otherwise disclosed on
Schedule 6.16:
(a) The Parent, each Borrower and its respective Subsidiaries
have complied in all material respects with all Environmental Laws and none of
the Parent, the Borrowers or their Subsidiaries nor any of their presently
owned real property or presently conducted operations, nor their previously
owned real property or prior operations to the extent relating to their
ownership of or their operations on any property at the time of such ownership
or operations on such property, is subject to any enforcement order from or
liability agreement with any Governmental Authority or private Person
respecting (i) compliance with any Environmental Law or (ii) any potential
liabilities and costs or remedial action arising from the Release or threatened
Release of a Contaminant.
(b) The Parent, each Borrower and its respective Subsidiaries
have obtained all permits necessary for their current operations under
Environmental Laws, and all such permits are in good standing and the Parent,
each Borrower and its respective Subsidiaries are in compliance with all
material terms and conditions of such permits.
(c) None of the Parent, any Borrower or its respective
Subsidiaries nor, to the best of each Borrower's knowledge, any of its
predecessors in interest, has in violation of applicable law stored, treated or
disposed of any hazardous waste.
(d) None of the Parent, any Borrower or its respective
Subsidiaries has received any summons, complaint, order or similar written
notice indicating that it is not currently in compliance with, or that any
Governmental Authority is investigating its compliance with, any Environmental
Laws or that it is or may be liable to any other Person as a result of a
Release or threatened Release of a Contaminant.
(e) To the best of each Borrower's knowledge, none of the
present or past operations of the Parent, any Borrower or its respective
Subsidiaries is the subject of any investigation by any Governmental Authority
evaluating whether any remedial action is needed to respond to a Release or
threatened Release of a Contaminant.
(f) There is not now, nor to the best of each Borrower's
knowledge has there ever been on or in the Real Estate:
(1) any underground storage tanks or surface
impoundments,
(2) any asbestos-containing material, or
(3) any polychlorinated biphenyls (PCBs) used in
hydraulic oils, electrical transformers or other equipment.
(g) None of the Parent, any Borrower or its respective
Subsidiaries has filed any notice under any requirement of Environmental Law
reporting a spill or accidental and unpermitted Release or discharge of a
Contaminant into the environment.
(h) None of the Parent, any Borrower or its respective
Subsidiaries has entered into any negotiations or settlement agreements with
any Person (including the prior owner of its property) imposing material
obligations or liabilities on any Credit Party with respect to any remedial
action in response to the Release of a Contaminant or environmentally related
claim.
(i) None of the products manufactured, distributed or sold by
any of the Parent, any Borrower or its respective Subsidiaries contain asbestos
containing material.
(j) No Environmental Lien has attached to the Real Estate.
6.17 No Violation of Law. None of the Parent, any Borrower nor any of
its respective Subsidiaries is in violation of any law, statute, regulation,
ordinance, judgment, order, or decree applicable to it which violation could
reasonably be expected to have a Material Adverse Effect.
6.18 No Default. None of the Parent, any Borrower nor any of its
respective Subsidiaries is in default with respect to any note, indenture, loan
agreement, mortgage, lease, deed, or other agreement to which such Borrower or
such Subsidiary is a party or by which it is bound, which default could
reasonably be expected to have a Material Adverse Effect.
6.19 ERISA Compliance. Except for matters that could not reasonably be
expected to have a Material Adverse Effect or as specifically disclosed in
Schedule 6.19:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the knowledge of each
Borrower, nothing has occurred which would cause the loss of such
qualification. Each Borrower and each ERISA Affiliate has made all required
contributions to any Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of each
Borrower, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect. There has been no non-exempt
prohibited transaction or violation of the fiduciary responsibility rules with
respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability [as of January
1, 2003]; (iii) neither any Borrower nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability under Title IV of ERISA with respect
to any Pension Plan (other than premiums due and not delinquent under Section
4007 of ERISA); (iv) neither any Borrower nor any ERISA Affiliate has incurred,
or reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Section 4201 or 4243 of ERISA with respect to a Multi-employer
Plan; and (v) neither any Borrower nor any ERISA Affiliate has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
6.20 Taxes. The Credit Parties have filed all federal and other
material tax returns and reports required to be filed, and have paid all
federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable unless such unpaid taxes and assessments would
constitute a Permitted Lien.
6.21 Regulated Entities. None of the Parent, any Borrower, any Person
controlling the Parent, any Borrower, or any of its respective Subsidiaries,
(a) is an "Investment Company" within the meaning of the Investment Company Act
of 1940, or (b) is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, any
state public utilities code or law, or any other federal or state statute or
regulation limiting its ability to incur indebtedness.
6.22 Use of Proceeds; Margin Regulations. The proceeds of the Loans
are to be used solely for working capital and other corporate purposes. Neither
the Parent, any Borrower nor any Subsidiary is engaged, principally or as one
of its important activities, in the business of purchasing or selling Margin
Stock or extending credit for the purpose of purchasing or carrying Margin
Stock. Margin Stock does not constitute more than 25% of the value of the
assets of the Parent and its Subsidiaries on a consolidated basis and neither
the Parent nor any of its Subsidiaries has any intention that Margin Stock will
constitute more than 25% of the value of such assets.
6.23 Copyrights, Patents, Trademarks and Licenses, etc. The Parent and
each Borrower owns, is licensed or otherwise has the lawful right to use, all
patents, trademarks, service marks, trade names, copyrights, technology,
know-how and processes (collectively the "Intellectual Property") used in or
necessary for the conduct of its business as currently conducted which are
material to its financial condition, business, operations, assets and
prospects, individually or taken as a whole. To the knowledge of the Borrowers,
the use of such patents, trademarks, service marks trade names, copyrights,
technology, know-how and processes by the Parent or the Borrowers does not
infringe on the rights of any Person, subject to such claims and infringements
the existence of which do not have or are not reasonably expected to have a
Material Adverse Effect. The transactions contemplated by the Loan Documents
will not impair the ownership of or rights under (or the license or other right
to use, as the case may be) any patents, trademarks, service marks, trade
names, copyrights, technology, know-how or processes by the Parent or any
Borrower in any manner which has or might have a Material Adverse Effect.
6.24 No Material Adverse Effect. No Material Adverse Effect has
occurred since the date of the audited Financial Statements delivered to the
Lenders pursuant to Section 6.6(a).
6.25 Full Disclosure. None of the representations or warranties made
by any Credit Party in the Loan Documents as of the date such representations
and warranties are made or deemed made, and none of the statements contained in
any written exhibit, report, statement or certificate furnished by or on behalf
of any Credit Party in connection with the Loan Documents (including the
offering and disclosure materials delivered by or on behalf of any Borrower to
the Lenders prior to the Effective Date), contains any untrue statement of a
material fact or omits any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances
under which they are made, not misleading as of the time when made or
delivered.
6.26 Material Agreements. None of the Parent, any Borrower or any of
its respective Subsidiaries is a party to or subject to any Contractual
Obligation or other restriction contained in its charter or by-laws which has
or would reasonably be expected to have a Material Adverse Effect after giving
effect to the consummation of the transactions contemplated in the Loan
Documents or otherwise.
6.27 Bank Accounts. Schedule 6.27 contains as of the Effective Date a
complete and accurate list of all bank accounts maintained by all Credit
Parties with any bank or other financial institution.
6.28 Governmental Authorization. The Parent and the Borrowers hold all
licenses, permits and other approvals of Governmental Authorities necessary for
the conduct of their business as currently conducted. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or other Person is necessary or required in connection
with the execution, delivery or performance by, or enforcement against, any
Credit Party of any Loan Document to which it is a party, except such as have
been obtained, given or made, as applicable.
6.29 Tax Shelter Regulations. No Borrower intends to treat the Loans
and/or Letters of Credit and related transactions as being a "reportable
transaction" (within the meaning of Treasury Regulation Section 1.6011-4). In
the event any Borrower determines to take any action inconsistent with such
intention, it will promptly notify the Agent thereof. If any Borrower so
notifies the Agent, such Borrower acknowledges that one or more of the Lenders
may treat its Loans and/or its interest in Non-Ratable Loans and/or Agent
Advances and/or Letters of Credit as part of a transaction that is subject to
Treasury Regulation Section 301.6112-1, and such Lender or Lenders, as
applicable, will maintain the lists and other records required by such Treasury
Regulation.
ARTICLE 7
AFFIRMATIVE AND NEGATIVE COVENANTS
Each Borrower covenants to the Agent and each Lender that so long as
any of the Obligations remain outstanding or this Agreement is in effect:
7.1 Taxes and Other Obligations. Each Borrower shall, and shall cause
the Parent to, (a) file when due all U.S. federal and state income tax returns
and other material returns and reports which it is required to file; and (b)
pay, or provide for the payment, when due, of all U.S. federal taxes and other
material taxes, fees, assessments and other charges of Governmental Authorities
against it or upon its property, income and franchises, make all required
withholding and other tax deposits, and establish adequate reserves for the
payment of all such items, and provide to the Agent and the Lenders, upon
request, satisfactory evidence of its timely compliance with the foregoing;
provided, however, so long as ATI has notified the Agent in writing, none of
the Parent or the Borrowers need pay any tax, fee, assessment, or governmental
charge (i) it is contesting in good faith by appropriate proceedings diligently
pursued, (ii) as to which the Parent or such Borrower, as the case may be, has
established proper reserves as required under GAAP, and (iii) the nonpayment of
which does not result in the imposition of a Lien (other than a Permitted
Lien).
7.2 Legal Existence and Good Standing. Except as otherwise permitted
under Sections 7.10(a)(ix) or 7.16(a), each Borrower shall, and shall cause the
Parent to, maintain its legal existence and its qualification and good standing
in all jurisdictions in which the failure to maintain such existence and
qualification or good standing could reasonably be expected to have a Material
Adverse Effect.
7.3 Compliance with Law and Agreements; Maintenance of Licenses. Each
Borrower shall comply, and shall cause the Parent to comply, in all material
respects with all Requirements of Law of any Governmental Authority having
jurisdiction over it or its business (including the Federal Fair Labor
Standards Act and all Environmental Laws) where the failure to so comply could
reasonably be expected to have a Material Adverse Effect. Each Borrower shall
obtain and maintain, and shall cause the Parent to obtain and maintain, all
material licenses, permits, franchises, and governmental authorizations
necessary to own its property and to conduct its business as conducted on the
Effective Date. No Borrower shall modify, amend or alter, or permit the Parent
to modify, amend or alter, its certificate or articles of incorporation, or its
limited liability company operating agreement or limited partnership agreement,
as applicable, other than in a manner which does not adversely affect the
rights and interests of the Lenders or the Agent.
7.4 Maintenance of Property; Appraisals and Inspection of Property.
(a) Each Borrower shall maintain, and shall cause the Parent to
maintain, all of its property material to the operation of its business in good
operating condition and repair, ordinary wear and tear and, subject to Section
7.6, loss or damage from casualty or condemnation excepted.
(b) Each Borrower shall permit, and shall cause the Parent to
permit, representatives and independent contractors of the Agent to visit and
inspect any of its or the other Credit Parties' properties, to conduct
appraisals and audits of Collateral, to examine its corporate, financial and
operating records, and make copies thereof or abstracts therefrom and to
discuss its affairs, finances and accounts with its directors, officers and
independent public accountants, at reasonable times during normal business
hours; provided, however, that (i) if Liquidity is equal to or greater than
$100,000,000 at all times during any Fiscal Year, the Agent shall be permitted
to conduct, and shall be reimbursed by the Borrowers for expenses in connection
with, only one field exam and one inventory and fixed asset appraisal during
such Fiscal Year, (ii) if Liquidity is less than $100,000,000 at any time
during any Fiscal Year, the Agent shall thereafter be permitted to conduct, and
shall be reimbursed by the Borrowers for expenses in connection with, up to
three field exams and up to two inventory and fixed asset appraisals during
such Fiscal Year, and (iii) if any Event of Default described in Section
9.1(a), (b), (c)(i) or (ii), (d), (e), (f), (g), (h), (i), (k), (l) or (m)
shall have occurred and be continuing, the Agent shall be permitted to conduct,
and shall be reimbursed by the Borrowers for all expenses in connection with,
all field exams and appraisals requested by the Agent in its reasonable
judgment.
7.5 Insurance.
(a) Each Borrower shall maintain, and shall cause the Parent to
maintain, with financially sound and reputable insurers having a rating of at
least A- or better by Best Rating Guide, insurance of such types as is
customary for Persons of similar size engaged in the same or similar business
in amounts, and under policies reasonably acceptable to the Agent and otherwise
as is customary for Persons of similar size engaged in the same or similar
types of business. Without limiting the foregoing, in the event that any
improved Real Estate covered by the Mortgages is determined to be located
within an area that has been identified by the Director of the Federal
Emergency Management Agency as a Special Flood Hazard Area ("SFHA"), each
Borrower shall purchase and maintain flood insurance on the improved Real
Estate and any Equipment and Inventory located on such Real Estate. The amount
of said flood insurance shall, at a minimum, comply with applicable federal
regulations as required by the Flood Disaster Protection Act of 1973, as
amended. Each Borrower shall also maintain flood insurance for its Inventory
and Equipment which is, at any time, located in a SFHA.
(b) Each Borrower shall cause the Agent, for the ratable benefit
of the Agent and the Lenders, to be named as secured party or mortgagee and
sole loss payee or additional insured, in a manner acceptable to the Agent.
Each policy of insurance shall contain a clause or endorsement requiring the
insurer to give not less than thirty (30) days' prior written notice to the
Agent in the event of cancellation of the policy for any reason whatsoever and
a clause or endorsement stating that the interest of the Agent shall not be
impaired or invalidated by any act or neglect of the Parent, any Borrower or
any of its Subsidiaries or the owner of any Real Estate or the use of such Real
Property by any of them for purposes more hazardous than are permitted by such
policy. All premiums for such insurance shall be paid by the Borrowers when
due, and certificates of insurance and, if reasonably requested by the Agent,
photocopies of the policies, shall be delivered to the Agent, in each case in
sufficient quantity for distribution by the Agent to each of the Lenders. If
any Borrower fails to procure such insurance or to pay the premiums therefor
when due, the Agent may, and at the direction of the Required Lenders shall, do
so from the proceeds of Revolving Loans.
7.6 Insurance and Condemnation Proceeds. Each Borrower shall promptly
notify the Agent and the Lenders of any material loss, damage, or destruction
to the Collateral, whether or not covered by insurance. The Agent is hereby
authorized to collect all property insurance and condemnation proceeds in
respect of Collateral in an amount in excess of $500,000 for any incident
("Excess Proceeds") directly and to apply or remit them as follows:
(a) With respect to insurance and condemnation proceeds relating
to Collateral other than Fixed Assets, after deducting from such proceeds the
reasonable expenses, if any, incurred by the Agent in the collection or
handling thereof, the Agent shall apply such proceeds, ratably, to the
reduction of the Obligations in the order provided for in Section 3.8.
(b) With respect to insurance and condemnation proceeds relating
to Collateral consisting of Fixed Assets, the Agent shall permit or require the
applicable Borrower to use such proceeds, or any part thereof, to replace,
repair, restore or rebuild the relevant Fixed Assets in a diligent and
expeditious manner with materials and workmanship of substantially the same
quality as existed before the loss, damage or destruction so long as (1) no
Event of Default has occurred and is continuing, (2) the aggregate proceeds do
not exceed $3,000,000 and (3) ATI or such Borrower first (i) provides the Agent
with plans and specifications for any such replacement, repair or restoration
which shall be reasonably satisfactory to the Agent and (ii) demonstrates to
the reasonable satisfaction of the Agent that the funds available to it will be
sufficient to complete such project in the manner provided therein. In all
other circumstances, the Agent shall apply such insurance and condemnation
proceeds, ratably, to the reduction of the Obligations in the order provided
for in Section 3.8.
Any such proceeds other than Excess Proceeds may be retained by the
Borrowers.
7.7 Environmental Laws.
(a) Each Borrower shall, and shall cause the Parent and each of
its Subsidiaries to, conduct its business in compliance with all Environmental
Laws applicable to it, including those relating to the generation, handling,
use, storage, and disposal of any Contaminant unless the failure to do so could
not reasonably be expected to have a Material Adverse Effect and the Borrowers
shall, and shall cause the Parent and each of its Subsidiaries to, take prompt
and appropriate action to respond to any such non-compliance with Environmental
Laws and shall regularly report to the Agent on such response.
(b) Without limiting the generality of the foregoing, ATI shall
submit to the Agent and the Lenders annually, commencing on the first
Anniversary Date, and on each Anniversary Date thereafter, copies of any
material notices received by the Borrowers from any Governmental Authority
under any Environmental Law, if any, and copies of any environmental reports
prepared by the Borrowers, in each case prepared by or received by the
Borrowers during such prior year, if any. The Agent or any Lender may request
copies of technical reports prepared by any Borrower and its communications
with any Governmental Authority to determine whether such Borrower or any of
its Subsidiaries is proceeding reasonably to correct, cure or contest in good
faith any alleged non-compliance or environmental liability. At any time after
the occurrence and during the continuation of any Event of Default, each
Borrower shall, at the Agent's or the Required Lenders' request and at the
applicable Borrower's expense, with respect to any Mortgaged Property (i)
retain an independent environmental engineer acceptable to the Agent to
evaluate the site, including tests if appropriate, where the Agent has a
reasonable basis to believe any material non-compliance or alleged
non-compliance with Environmental Laws has occurred and prepare and deliver to
the Agent, in sufficient quantity for distribution by the Agent to the Lenders,
a report setting forth the results of such evaluation, a proposed plan for
responding to any environmental problems described therein, and an estimate of
the costs thereof, and (ii) provide to the Agent and the Lenders a supplemental
report of such engineer whenever the scope of the environmental problems, or
the response thereto or the estimated costs thereof, shall increase in any
material respect; provided that the Agent and its representatives will have the
right at any reasonable time to enter and visit such Mortgaged Property and for
the purposes of observing such Mortgaged Property. The Agent is under no duty,
however, to visit or observe the Mortgaged Property or to conduct tests, and
any such acts by the Agent will be solely for the purposes of protecting the
Agent's Liens and preserving the Agent and the Lenders' rights under the Loan
Documents. No site visit, observation or testing by the Agent and the Lenders
will result in a waiver of any default of any Borrower or impose any liability
on the Agent or the Lenders. In no event will any site visit, observation or
testing by the Agent be a representation that hazardous substances are or are
not present in, on or under the Mortgaged Property, or that there has been or
will be compliance with any Environmental Law. None of the Borrowers, any other
Credit Party nor any other party is entitled to rely on any site visit,
observation or testing by the Agent. The Agent and the Lenders owe no duty of
care to protect the Borrowers, any other Credit Party or any other party
against, or to inform the Borrowers, any other Credit Party or any other party
of, any hazardous substances or any other adverse condition affecting the
Mortgaged Property. The Agent may in its discretion disclose to the Borrowers
or to any other party if so required by law any report or findings made as a
result of, or in connection with, any site visit, observation or testing by the
Agent. Each Borrower understands and agrees that the Agent makes no warranty or
representation to the Borrowers or any other party regarding the truth,
accuracy or completeness of any such report or findings that may be disclosed.
Each Borrower also understands that depending on the results of any site visit,
observation or testing by the Agent and disclosed to the Borrowers, the
Borrowers, the Parent, or its Subsidiaries may have a legal obligation to
notify one or more environmental agencies of the results, that such reporting
requirements are site-specific, and are to be evaluated by the applicable
Borrower without advice or assistance from the Agent. In each instance, the
Agent will give the applicable Borrower reasonable notice before entering such
Mortgaged Property. The Agent will make reasonable efforts to avoid interfering
with such Borrower's or any other Credit Party's use of such Mortgaged Property
or any other property in exercising any rights provided hereunder.
7.8 Compliance with ERISA. Each Borrower shall, and shall cause each
of its ERISA Affiliates to: (a) maintain each Plan in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
federal or state law; (b) cause each Plan which is qualified under Section
401(a) of the Code to maintain such qualification; (c) make all required
contributions to any Plan subject to Section 412 of the Code; (d) not engage in
a non-exempt prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan; and (e) not engage in a
transaction that could reasonably be expected to be subject to Section 4069 or
4212(c) of ERISA.
7.9 Debt. No Borrower shall, nor permit the Parent to, create, incur,
assume or otherwise become or remain directly or indirectly liable with respect
to any Debt, except:
(a) the Obligations;
(b) Debt in the form of bank overdrafts in the ordinary course
of business;
(c) (i) Debt incurred by any Borrower to finance Capital
Expenditures and (ii) Capital Lease obligations of any Borrower;
(d) Debt in respect of Accommodation Obligations permitted under
Section 7.12;
(e) Debt of the Parent to ATI in connection with any advances
made pursuant to Section 7.11(b);
(f) Debt in respect of Hedge Agreements and Foreign Currency
Exchange Contracts entered into in the ordinary course of business and not for
speculative purposes;
(g) intercompany Debt among the Borrowers;
(h) Debt of the Parent under the Convertible Debentures and
refinancings in full thereof and renewals or extensions thereof so long as (A)
no Default or Event of Default exists or would be caused thereby, (B) such Debt
is not secured by any assets of the Parent, the Borrowers or any of their
Subsidiaries; (C) the maturity date thereof shall not be less than one year
following the Stated Termination Date hereunder, (D) the documentation
evidencing such refinancing, renewal or extension shall not contain any
cross-default (other than payment defaults) (as opposed to cross-acceleration)
to this Agreement, (E) the Agent determines in its reasonable commercial
discretion that the documentation evidencing such refinancing, renewal or
extension does not contain any material covenants or events of default (or
comparable provisions) that are in addition to or more restrictive than the
material covenants and Events of Default contained in the Loan Documents and
(F) the pro forma Fixed Charge Coverage Ratio as of the Twelve-Month Period
most recently ended prior to such refinancing, renewal or extension shall be
greater than 1.1 to 1.0;
(i) Debt of ATI under the Convertible Debentures Note and
refinancing, renewals and extensions thereof provided such refinancing, renewal
or extension would not be detrimental in any material respect to the rights of
or benefits to the Borrowers, the Agent or the Lenders;
(j) Permitted Existing Debt (other than Debt permitted under
clauses (h) or (i) above) and refinancings, renewals or extensions thereof so
long as (A) no Default or Event of Default exists or would be caused thereby,
(B) the principal amount of any such Permitted Existing Debt is not increased
(other than by an amount equal to the reasonable amount of fees and expenses
payable in connection with such refinancing, renewal or extension); (C) the
maturity date thereof is not accelerated as a result of any such refinancing,
renewal or extension and (D) no such refinancing, renewal or extension would be
otherwise detrimental in any material respect to the rights of or benefits to
the Borrowers, the Agent or the Lenders;
(k) Debt of any Person assumed in connection with an Acquisition
of such Person permitted under Sections 7.11(j) or 7.16(a) if such Person
becomes a Borrower after the date hereof; provided, that such Debt exists at
the time such Person becomes a Borrower and was not created in anticipation of
such acquisition;
(l) Debt consisting of (A) unsecured deferred payment
obligations of a Borrower owing to sellers in permitted Acquisitions and (B)
customary purchase price adjustments, earn-outs, indemnification obligations
and similar items of the Borrowers in connection with permitted Acquisitions
and asset sales;
(m) the AT Sourcing Obligation; and
(n) other Debt of the Borrowers not exceeding in the aggregate
principal amount of $25,000,000 at any one time outstanding.
7.10 Sales of Assets; Liens.
(a) Sales. No Borrower shall, nor permit the Parent to, sell,
assign, transfer, lease, convey or otherwise dispose of, any properties or
assets, whether now owned or hereafter acquired, or any income or profits
therefrom, except among the Borrowers and except:
(i) sales of inventory and subleases of real property in the
ordinary course of business;
(ii) subleases of real property not in the ordinary course
of business, but only to the extent the aggregate annual rental payments
accrued under all such subleases do not exceed $1,000,000;
(iii) sales or other dispositions of equipment that is
obsolete, unused or, in the judgment of such Borrower, no longer best used or
useful in its business;
(iv) License or sublicense agreements or marketing
agreements with third parties in the ordinary course of business, provided,
however that no such license or sublicense or marketing agreement shall
materially impair the ability of the Agent to dispose of the Collateral;
(v) sales or dispositions of Cash Equivalents;
(vi) Sales of Investments permitted under clauses (k) and
(l) of Section 7.11; and
(vii) so long as no Event of Default shall have then
occurred and be continuing or would result therefrom, transfer of cash or
property in an amount not to exceed $1,000,000 (or, if Liquidity is in excess
of $50,000,000 both before and after giving effect thereto, $10,000,000) for
each Fiscal Year to a charitable foundation established by any Borrower or the
Parent;
(viii) dispositions as the result of any taking or
condemnation so long as insurance or condemnation proceeds are received in
connection therewith and are applied as required by Section 7.6; and
(ix) other sales of assets, including the sale of Securities
of Subsidiaries, whether or not in the ordinary course of business, having an
aggregate fair market value of not more than $15,000,000 pursuant to any one
single disposition or $20,000,000 in the aggregate pursuant to several
dispositions in any one Fiscal Year;
provided, that no disposition permitted above (other than transfers permitted
by clause (i), (vi), (vii) or (viii)) in excess of $1,000,000 per transaction
shall be permitted unless the price to be received therefor represents the
then fair market value of the asset or property sold at the time of such
disposition and (other than in the case of subleases or license arrangements)
at least 70% of the price is to be paid in cash at the closing of the
disposition.
(b) Liens. No Borrower shall, nor permit the Parent to, create,
incur, assume or permit to exist, directly or indirectly, any Lien on or with
respect to any of its property except:
(i) Liens securing the Obligations;
(ii) Liens upon the interest or title of a lessor or secured
by a lessor's interest under any lease under which any Borrower is the lessee
and the interest of the lessee under any lease under which any Borrower is the
lessor;
(iii) Permitted Liens;
(iv) Liens granted by any Borrower (including the interest
of a lessor under a Capital Lease) and Liens on property existing at the time
of acquisition thereof by such Borrower, in each case securing Debt permitted
by Section 7.9(c), provided that such Liens are limited to the assets financed
with such Debt;
(v) Permitted Existing Liens and any extensions, renewals
and replacements thereof so long as (i) the amount of the obligations secured
thereby is not increased in connection with any such extension, renewal or
replacement and (ii) such Lien is limited to the property subject thereto prior
to such extension, renewal or replacement;
(vi) Liens in respect of Debt of a Person permitted pursuant
to Section 7.9(k) so long as such Liens attach only to Fixed Assets of such
Person existing prior to the Acquisition or merger of such Person;
(vii) to the extent Debt secured thereby is permitted to be
extended, renewed, replaced or refinanced, a future Lien upon any property
which is subject to a Lien described in clause (vi) above, if such future Lien
attaches only to the same property, secures only such permitted extensions,
renewals, replacements or refinancings and is of like quality, character and
extent; and
(viii) Liens on cash earnest money deposits in connection
with Acquisitions otherwise permitted by this Agreement in an aggregate amount
not to exceed $2,500,000 at any time outstanding.
7.11 Investments. No Borrower shall, nor permit the Parent to, make or
own, directly or indirectly, any Investment in any Person except:
(a) Investments by the Parent and the Borrowers in Cash
Equivalents;
(b) Investments by any Borrower resulting from advances to the
Parent to fund any of the items set forth in Section 7.13(a);
(c) Investments by the Parent in ATI;
(d) Investments by any Borrower in any other Borrower (other
than any Investment made in connection with the Acquisition of any Borrower);
(e) Investments by the Borrowers in joint ventures (in the form
of corporations, partnerships or otherwise) and Unrestricted Subsidiaries;
provided that, after giving effect to such Investment, the aggregate amount
then outstanding of all such Investments (other than the AT Sourcing
Obligation) in excess of the amount of Investments in joint ventures and
Unrestricted Subsidiaries existing on the Effective Date by the Borrowers
(including Investments in the nature of sales and transfers of assets for less
than fair market value and Accommodation Obligations) shall not exceed
$35,000,000; provided that (i) after giving effect to the making of any such
Investment, Liquidity shall not be less than $35,000,000 and (ii) no
Investments in joint ventures and Unrestricted Subsidiaries shall be made upon
the occurrence and during the continuation of an Event of Default;
(f) Investments not exceeding $10,000,000 at any one time
outstanding in respect of loans to senior executives and key employees of the
Parent or any Borrower; provided that (i) after giving effect to such
Investment, Liquidity shall not be less than $35,000,000 and (ii) no such
Investments shall be made upon the occurrence and during the continuation of an
Event of Default;
(g) Investments in the form of advance payments to suppliers not
in excess of an aggregate amount of $20,000,000 outstanding at any one time,
provided that, (i) after giving effect to such Investment, Liquidity shall not
be less than $35,000,000 and (ii) no such Investments shall be made upon the
occurrence and during the continuation of an Event of Default;
(h) the Convertible Debentures Note;
(i) Investments in respect of Hedge Agreements and Foreign
Currency Exchange contracts entered into in the ordinary course of business and
not for speculative purposes;
(j) Investments the Borrowers made in connection with
Acquisitions provided that the Person to be (or whose assets are to be)
acquired does not oppose such Acquisition, the Person to be acquired will
immediately become, directly or indirectly, a Wholly-Owned Subsidiary of ATI
and the line or lines of business of the Person to be acquired are
substantially the same as one or more line or lines of business conducted by
the Borrowers at the time such Acquisition is consummated or is permitted to be
conducted by the Borrowers pursuant to Section 7.14 and immediately prior to
and immediately after giving effect to any such Acquisition (including
reasonable estimates of any indemnification or purchase price adjustment
obligations) (i) Liquidity shall not be less than $35,000,000, (ii) the pro
forma Fixed Charge Coverage Ratio as of the most recently ended Twelve-Month
Period for which financial statements have been delivered in accordance with
Section 5.2(b) shall be greater than 1.10 to 1.00, (iii) no Default or Event of
Default shall have occurred and be continuing; provided that on the date of
consummation of any Acquisition ATI shall deliver to the Agent a certificate of
a Responsible Officer, prepared on a historical pro forma basis as of the most
recent date for which financial statements have been furnished to the Agent
giving effect to such Acquisition, demonstrating that the requirements of
clauses (i), (ii) and (iii) above have been met; and
(k) promissory notes and other similar non-cash consideration
received by any Borrower in connection with dispositions of assets permitted by
Section 7.10(a);
(l) Investments in securities of account debtors received
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such account debtors;
(m) Investments consisting of Accommodation Obligations
permitted under Section 7.12 and the exercise thereof;
(n) Investments existing on the Effective Date and set forth on
Schedule 7.11;
(o) Investments in the form of progress payments in connection
with the development of software and related hardware made in the ordinary
course of business and consistent with past practice of the Parent and the
Borrowers; and
(p) other Investments not permitted elsewhere in this Section
7.11 by any Borrower not in excess of an aggregate amount of $20,000,000
outstanding at any one time, provided that (i) after giving effect to such
Investment, Liquidity shall not be less than $35,000,000 and (ii) no such
Investments shall be made upon the occurrence and during the continuation of an
Event of Default.
7.12 Accommodation Obligations. No Borrower shall, nor permit the
Parent to, create or become or be liable, directly or indirectly, with respect
to any Accommodation Obligation except:
(a) guaranties resulting from endorsement of negotiable
instruments for collection in the ordinary course of business;
(b) obligations, warranties and indemnities, not relating to
Debt of any Person, which have been or are undertaken or made in the ordinary
course of business and not for the benefit or in favor of an Affiliate of any
Borrower or such Subsidiary;
(c) Accommodation Obligations of ATI in connection with (i)
obligations of the Parent to fund (A) income and franchise taxes payable in
such Fiscal Year owed by the Parent pursuant to the Tax Sharing Agreement dated
as of July 12, 1989 between the Parent and ATI; (B) other ordinary operating
expenses of the Parent not in excess of $500,000 in any Fiscal Year; (C)
purchases of capital stock of the Parent held by employees of any Credit Party
to enable such employee to pay withholding taxes in connection with the vesting
of such stock and (D) the Parent's share of expenses incurred in connection
with, any public offering of Common Stock; and (ii) the guaranty of the
Convertible Debentures.
(d) Accommodation Obligations of the Parent or any Borrower in
respect of any obligations of any Borrower otherwise permitted hereunder; and
(e) Accommodation Obligations with respect to obligations of
Unrestricted Subsidiaries to the extent such Accommodation Obligations
constitute Investments permitted by Section 7.11(e).
(f) Accommodation Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with Acquisitions or asset sales permitted by this Agreement; and
(g) Accommodation Obligations in respect of performance bonds,
surety bonds, appeal bonds or custom bonds required in the ordinary course of
business or in connection with judgments that do not result in an Event of
Default.
7.13 Restricted Payments. No Borrower shall, nor permit the Parent to,
declare or make any Restricted Payment except:
(a) dividends paid and declared in any Fiscal Year by ATI to the
Parent to fund (i) income and franchise taxes payable in such Fiscal Year owed
by the Parent pursuant to the Tax Sharing Agreement dated as of July 12, 1989
between the Parent and ATI; (ii) other ordinary operating expenses of the
Parent not in excess of $500,000 in any Fiscal Year; (iii) purchases of Common
Stock of the Parent held by employees of any Credit Party to enable such
employee to pay withholding taxes in connection with the vesting of such stock
and (iv) the Parent's share of expenses incurred in connection with, any public
offering of Common Stock;
(b) any Restricted Payment made by any Borrower (other than ATI)
on its capital stock;
(c) Restricted Payments by the Parent or any Borrower (in
addition to payments made pursuant to clause (a)(i) of this Section) to acquire
shares of Common Stock from employees of the Parent, any Borrower in an
aggregate amount not exceeding $100,000 in any Fiscal Year;
(d) Restricted Payments by ATI to the Parent to concurrently
fund (i) any dividend, redemption, retirement, sinking fund, or similar
payment, purchase or other acquisition for value, direct or indirect, of any
shares of Common Stock of the Parent now or hereafter outstanding; provided
that (A) after giving effect to such payment, Liquidity shall be greater than
$35,000,000, and (B) immediately prior to and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing and (ii) any
payment or prepayment of principal of, premium, if any, and any redemption,
purchase, retirement or defeasance of, or sinking fund or similar payment with
respect to the Convertible Debentures; provided that (A) for the sixty (60)
consecutive days prior to, and after giving effect to any such payment or
prepayment, Liquidity shall be greater than $35,000,000 and (B) no Event of
Default shall have occurred and be continuing either immediately prior to or
after giving effect to such payment or prepayment; and
(e) Restricted Payments by ATI to the Parent to concurrently
fund payments of interest on the Convertible Debentures by the Parent so long
as no notice of Event of Default shall have been delivered to ATI by the Agent
or any Lender.
7.14 Conduct of Business. No Borrower shall, nor permit any of its
Restricted Subsidiaries to, engage in any business other than (a) the business
engaged in by such Borrower or such Subsidiary on the date hereof and other
businesses similar or related thereto; and (b) any business activities related
to the home furnishings industry.
7.15 Transactions with Affiliates. No Borrower shall, nor permit the
Parent to, at any time after the Effective Date directly or indirectly enter
into or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any of its
Affiliates outside the ordinary course of its business or inconsistent with
past practices or on terms that are less favorable to it than those fair and
reasonable terms that might be obtained in a comparable arms-length transaction
at the time; provided that the foregoing restriction shall not apply to
transactions among any Borrower and any other Borrower, customary fees paid to
members of the Board of Directors of any Borrower or the Parent or arrangements
permitted under Section 7.11(f) or the business contemplated by the joint
ventures permitted under Section 7.11(e).
7.16 Restriction on Fundamental Changes.
(a) No Borrower shall, nor permit the Parent to, enter into any
merger or consolidation, or liquidate, wind-up or dissolve (or suffer any
liquidation or dissolution), discontinue its business or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or series of transactions,
all or any substantial part of its business or property, whether now or
hereafter acquired, except (i) as otherwise permitted under Section 7.10(a),
(ii) that any Borrower may merge into or convey, sell, lease or transfer all or
substantially all of its assets to, any other Borrower, (iii) that nothing
contained herein shall prohibit any Subsidiary of ATI from voluntarily
dissolving or liquidating if in the reasonable opinion of ATI's senior
management such dissolution or liquidation has no reasonable likelihood of
having a Material Adverse Effect and (iv) the merger of any Person with or into
a Borrower if the Acquisition of the capital stock of such Person by such
Borrower would have been permitted under Section 7.11(j); provided, that (x) in
the case of ATI, ATI shall be the continuing or surviving Person and (y) if a
Borrower (other than ATI) is not the surviving or continuing Person, the
surviving Person becomes a Borrower and a party to this Agreement and all other
applicable Loan Documents in accordance with Section 7.27(c).
(b) No Borrower shall, nor permit the Parent to, amend its
Certificate of Incorporation or By-Laws in a manner that is in any way adverse
to the rights of the Agent and the Lenders hereunder.
7.17 ERISA. No Borrower shall, nor permit any of its ERISA Affiliates
to, do any of the following to the extent that such act or failure to act would
in the aggregate, after taking into account any other such acts or failures to
act, have a Material Adverse Effect.
(a) Engage, or permit any ERISA Affiliate to engage, in any
prohibited transaction described in Sections 406 of ERISA or 4975 of the Code
for which a statutory or class exemption is not available or a private
exemption has not been previously obtained from the DOL;
(b) permit to exist any accumulated funding deficiency (as
defined in Sections 302 of ERISA and 412 of the Code), whether or not waived;
(c) terminate, or permit any ERISA Affiliate to terminate, any
Benefit Plan which would result in any liability of any Borrower or any ERISA
Affiliate under Title IV of ERISA;
(d) fail, or permit any ERISA Affiliate to fail, to make any
contribution or payment to any Multiemployer Plan which any Borrower or any
ERISA Affiliate may be required to make under any agreement relating to such
Multiemployer Plan, or any law pertaining thereto;
(e) fail, or permit any ERISA Affiliate to fail, to pay any
required installment or any other payment required under Section 412 of the
Code on or before the due date for such installment or other payment; or
(f) amend, or permit any ERISA Affiliate to amend, a Plan
resulting in an increase in current liability for the plan year such that any
Borrower or any ERISA Affiliate is required to provide security to such Plan
under Section 401(a)(29) of the Code.
7.18 Sales and Leasebacks. No Borrower shall, nor permit the Parent
to, become liable, directly or by way of any Accommodation Obligation, with
respect to any lease, whether an Operating Lease or a Capital Lease, of any
property whether now owned or hereafter acquired, (a) which any Borrower has
sold or transferred or is to sell or transfer to any other Person, or (b) which
such Borrower intends to use for substantially the same purposes as any other
property which has been or is to be sold or transferred by that entity to any
other Person in connection with such lease.
7.19 Convertible Debentures and other Debt.
(a) No Change. Except as permitted by Section 7.9(h), no
Borrower shall, nor permit the Parent to, amend, supplement or modify the terms
of the Convertible Debentures or the Convertible Debentures Note (i) which
relate to subordination, interest (including options to pay in kind),
principal, tenor, maturity, payments in respect of redemptions, repurchases,
sinking fund, principal, interest or other payments, or the acceleration
thereof or any rescission of acceleration or (ii) except if necessary to comply
with the provisions of the Trust Indenture Act of 1939 or (iii) by making more
restrictive, or adding, covenants, breaches, defaults, or events of default, or
(iv) by shortening cure periods, or (v) in any other manner that would be
adverse to the rights or interests of the Borrowers, the Agent or the Lenders.
(b) Notices. ATI shall, or cause the Parent to, deliver to the
Agent (i) a copy of each notice or other written communication delivered by or
on behalf of the Parent or ATI to any trustee under the Convertible Debenture
Indenture, such delivery to be made at the same time and by the same means as
such notice or other written communication is delivered to such Person, and
(ii) a copy of each notice or other written communication received by ATI or
the Parent from the trustee under the Convertible Debenture Indenture, such
delivery to be made promptly after such notice or other written communication
is received by ATI or the Parent.
7.20 Margin Regulations. No portion of the proceeds of any credit
extended under this Agreement shall be used, directly or indirectly, in any
manner which might cause any Credit Extension or the application of such
proceeds to violate Regulation T, Regulation U or Regulation X or any other
regulation of the Federal Reserve Board or to violate the Exchange Act or the
Securities Act, in each case as in effect on the date or dates of such
Borrowing and such use of proceeds.
7.21 Change of Fiscal Year. Neither the Parent nor any Borrower shall
change its Fiscal Year.
7.22 Subsidiaries.
(a) No Borrower shall, nor permit the Parent to, hereafter (i)
become a general partner in any general partnership or limited partnership or
(ii) organize or acquire any other Person, except (A) any Borrower may organize
or acquire any new Wholly Owned Subsidiary that becomes a Borrower pursuant to
the terms of Section 7.27(c) and (B) subject to the provisions of Section
7.27(d), any Borrower may organize or acquire any new joint venture (other than
a general partnership) or Unrestricted Subsidiary permitted pursuant to Section
7.11(e).
(b) No Borrower shall create or otherwise become effective any
consensual encumbrance or restriction of any kind, other than those
contemplated in the Loan Documents, on the ability of any Borrower to pay
dividends or make any other distribution in respect of its stock or make any
other Restricted Payment, pay any Debt or other obligation owed to any other
Borrower, make loans or advances or other Investments in any other Borrower or
sell, transfer or otherwise convey any of its property to any other Borrower
except (i) in connection with any document or instrument governing Liens
permitted by Section 7.10(b)(iv) provided that such restriction contained
therein relates only to the asset or assets subject to such Lien or (ii) any
lease the terms of which prohibit the transfer of such lease to any Credit
Party or otherwise.
7.23 Consignment of Title Documents. At any time at the request of the
Agent or the Required Lenders (i) after the occurrence and during the
continuation of an Event of Default or (ii) during any period that Liquidity is
less than $35,000,000, each Borrower shall deliver or cause to be delivered to
the Agent for the benefit of the Lenders any title or similar documents
(including, without limitation, warehouse receipts), and/or cause the Agent to
be named as consignee, in each case in respect of goods covered or originally
covered by a Letter of Credit (including any Existing Letter of Credit).
7.24 Fixed Charge Coverage Ratio. As of the end of each month during
which an Illiquidity Period shall be in effect, ATI shall maintain a Fixed
Charge Coverage Ratio of not less than 1.10 to 1.00 for each Twelve-Month
Period ended on the last day of such month; provided, however, that,
notwithstanding the foregoing, for any month ending prior to February 1, 2004
during which an Illiquidity Period shall be in effect, ATI shall be required to
maintain a Fixed Charge Coverage Ratio for the Twelve-Month Period ended on the
last day of such month of not less than 1.00 to 1.00.
7.25 [Intentionally Omitted].
7.26 Further Assurances. The Credit Parties shall execute and deliver,
or cause to be executed and delivered, to the Agent and/or the Lenders such
documents and agreements, and shall take or cause to be taken such actions, as
the Agent or any Lender may, from time to time, reasonably request to carry out
the terms and conditions of this Agreement and the other Loan Documents.
7.27 Pledge of After-Acquired Property; Additional Borrowers. (a) With
respect to any property acquired after the Effective Date by the Parent or any
Borrower (other than (1) any property described in paragraph (b), (c) or (d)
below, (2) any property subject to a Lien expressly permitted by Section
7.10(b)(iv) and (vi), and (3) leasehold interests and motor vehicles) as to
which the Agent, for the benefit of the Lenders, does not have a perfected
Lien, the applicable Borrower shall, or shall cause the Parent to, promptly (i)
execute and deliver to the Agent such amendments to the Pledge and Security
Agreement, or such other documents as the Agent deems necessary or advisable to
grant to the Agent, for the benefit of the Lenders, a security interest in such
property and (ii) take all actions necessary or advisable to grant to the
Agent, for the benefit of the Lenders, a perfected first priority security
interest in such property, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Collateral
Documents or by law or as may be requested by the Agent; provided that the
Borrowers shall not be required to update (or reimburse the Agent for any
update) any filings with the U.S. Patent & Trademark Office more frequently
than once per year.
(b) With respect to any fee interest in any real property having
an Appraised Value (together with improvements thereof) of at least $7,500,000
acquired after the Effective Date by the Parent or any Borrower (other than any
such real property subject to a Lien expressly permitted by Section 7.10(b)(iv)
or (vi)), the applicable Borrower shall, or shall cause the Parent to, promptly
(i) execute and deliver a first priority mortgage, in favor of the Agent, for
the benefit of the Lenders, covering such real property, (ii) if requested by
the Agent, provide the Lenders with (x) title and extended coverage insurance
covering such real property in an amount at least equal to the purchase price
of such real property (or such other amount as shall be reasonably specified by
the Agent) as well as a current ALTA survey thereof, together with a surveyor's
certificate and (y) any consents or estoppels reasonably deemed necessary or
advisable by the Agent in connection with such mortgage or deed of trust, each
of the foregoing in form and substance reasonably satisfactory to the Agent and
(iii) if requested by the Agent, deliver to the Agent legal opinions relating
to the matters described above, which opinions shall be in form and substance,
and from counsel, reasonably satisfactory to the Agent.
(c) With respect to any Subsidiary other than an Unrestricted
Subsidiary created or acquired after the Effective Date, the applicable
Borrower shall promptly (i) cause such new Subsidiary (A) to become a party to
this Agreement as a "Borrower" hereunder, (B) to take such actions necessary or
advisable to grant to the Agent for the benefit of the Lenders a perfected
first priority security interest in the Collateral described in the Security
Instruments with respect to such new Subsidiary, including the filing of
Uniform Commercial Code financing statements in such jurisdictions as may be
required by the Security Instruments or by law or as may be requested by the
Agent and (C) to deliver to the Agent a certificate of such Subsidiary of the
type delivered on the Effective Date with respect to other Borrowers in form
and substance satisfactory to the Agent, (ii) execute and deliver to the Agent
such amendments to the Security Instruments and UCC-1 financing statements as
the Agent deems necessary or advisable to grant to the Agent, for the benefit
of the Lenders, a perfected first priority security interest in the Securities
of such new Subsidiary that are owned by any Borrower, (iii) deliver to the
Agent the certificates, if any, representing such Securities, together with
undated stock powers, in blank, executed and delivered by a duly authorized
officer of such Borrower, (iii) and (iv) if requested by the Agent, deliver to
the Agent legal opinions relating to the matters described above, which
opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Agent.
(d) With respect to any new Unrestricted Subsidiary created or
acquired or any new Investment permitted under this Agreement arising after the
Effective Date, the applicable Borrower shall promptly take any action and
execute and deliver to the Agent all documents and agreements required by the
applicable Security Instruments.
7.28 Cash Collateral and Deposit Accounts.
(a) Until the Agent notifies ATI to the contrary, the Credit
Parties shall make collection of all Accounts and other Collateral for the
Agent, shall receive all payments as the Agent's trustee, and shall immediately
deliver all payments in their original form duly endorsed in blank into one or
more Approved Deposit Accounts established in the name of such Credit Party. All
amounts deposited into such Approved Deposit Accounts shall be swept on a daily
basis and transferred to the Payment Account for further dispersal subject to
the Blocked Account Agreement. None of the Borrowers shall make any material
change in their cash management practices, including any change that would cause
amounts held in any Approved Deposit Account not to be swept on a daily basis to
the Payment Account. Following receipt of written notice from the Agent that an
Activation Period (as defined below) exists and until receipt of written notice
from the Agent that all Activation Periods have terminated, the Clearing Bank
shall not permit any Credit Party to make any withdrawals from the Payment
Account. Prior to or after the termination of an Activation Period, the Credit
Parties shall have the right to operate and transact business through the
Payment Account in normal fashion, including making withdrawals from the Payment
Account, but covenants to the Agent it will not close the Payment Account. No
later than two (2) Business Days following the commencement of the Activation
Period, and continuing on each Business Day thereafter, the Clearing Bank shall
transfer all collected and available balances in the Payment Account to the
Agent as the Agent shall direct. The "Activation Period" means each period which
(a) commences upon the day that either (i) Liquidity is less than $30,000,000 or
(ii) an Event of Default has occurred and is continuing, and (b) terminates on
the day Liquidity is in excess of $50,000,000 for a period of fifteen (15)
consecutive days or such Event of Default has been waived, as applicable.
(b) To the extent there are no Loans outstanding after
application of such collections in a Payment Account and no Event of Default
exists and no Activation Period is otherwise in effect, the Borrowers may
direct, or the Agent may in its discretion without such direction direct, that
any excess collections be deposited in the Designated Account. The Agent or the
Agent's designee may, at any time that an Event of Default exists, notify
Account Debtors that the Accounts have been assigned to the Agent and of the
Agent's security interest therein, and may collect them directly and charge the
collection costs and expenses to the Loan Account as a Revolving Loan. So long
as an Event of Default has occurred and is continuing, each Credit Party, at
the Agent's request, shall execute and deliver to the Agent such documents as
the Agent shall reasonably require to grant the Agent access to any post office
box in which collections of Accounts are received.
(c) If sales of Inventory are made or services are rendered for
cash, each Credit Party shall promptly deliver to the Agent or deposit into a
Deposit Account which is swept in the ordinary course of business into the
Payment Account the cash which such Credit Party receives.
(d) All payments received by the Agent at a bank account
designated by it, will be the Agent's sole property for its benefit and the
benefit of the Lenders and will be credited to the Loan Account immediately
(conditional upon final collection) if received no later than 12:00 noon (New
York City time) and otherwise on the next Business Day.
ARTICLE 8
CONDITIONS OF LENDING
8.1 Conditions Precedent to Making of Loans on the Effective Date. The
obligation of the Lenders to make the initial Revolving Loans on the Effective
Date, and the obligation of the Agent to cause the Letter of Credit Issuer to
issue any Letter of Credit on the Effective Date, are subject to the following
conditions precedent having been satisfied in a manner satisfactory to the
Agent and each Lender:
(a) This Agreement and the other Loan Documents shall have been
executed by each party thereto and the Borrowers shall have performed and
complied with all covenants, agreements and conditions contained herein and the
other Loan Documents which are required to be performed or complied with by the
Borrowers before or on such Effective Date.
(b) Immediately after making the Revolving Loans (including such
Revolving Loans made to finance the Closing Fee or otherwise as reimbursement
for fees, costs and expenses then payable under this Agreement), if any, on the
Effective Date and after giving effect to any Letters of Credit issued on the
Effective Date, and with all its obligations current, the Borrowers shall have
Availability of at least $50,000,000.
(c) All representations and warranties made hereunder and in the
other Loan Documents shall be true and correct as if made on such date (other
than representations and warranties which expressly speak only as of a
different date).
(d) No Default or Event of Default shall have occurred and be
continuing after giving effect to the Credit Extensions to be made on the
Effective Date.
(e) The Agent and the Lenders shall have received such opinions
of counsel for the Borrowers and the other Credit Parties as the Agent shall
request, each such opinion to be in a form, scope, and substance satisfactory
to the Agent, the Lenders, and their respective counsel.
(f) Copies of the Convertible Debenture Indenture certified as
true and correct by a Responsible Officer.
(g) The Agent shall have received:
(i) fully completed financing statements to be filed
under the UCC of all jurisdictions that the Agent may deem necessary or
desirable in order to perfect the Agent's Liens; and
(ii) duly executed UCC-3 Termination Statements and such
other instruments, in form and substance satisfactory to the Agent, as shall be
necessary to terminate and satisfy all Liens on the property of the Credit
Parties except Permitted Liens.
(h) The Borrowers shall have paid all fees and expenses of the
Agent and the Attorney Costs incurred in connection with any of the Loan
Documents and the transactions contemplated thereby to the extent invoiced.
(i) The Agent shall have received, in form, scope, and
substance, reasonably satisfactory to the Agent, evidence of all insurance
coverage as required by this Agreement.
(j) The Agent and the Lenders shall have had an opportunity, if
they so choose, to examine the books of account and other records and files of
the Parent and each Borrower and to make copies thereof, and to conduct a
pre-closing audit which shall include, without limitation, verification of
Inventory, Accounts and the Borrowing Base, and the results of such examination
and audit shall have been satisfactory to the Agent and the Lenders in all
respects.
(k) All proceedings taken in connection with the execution of
this Agreement, all other Loan Documents and all documents and papers relating
thereto shall be satisfactory in form, scope, and substance to the Agent and
the Lenders.
(l) Without limiting the generality of the items described
above, each Borrower and each Person guarantying or securing payment of the
Obligations shall have delivered or caused to be delivered to the Agent (in
form and substance reasonably satisfactory to the Agent), the financial
statements, instruments, resolutions, documents, agreements, certificates,
opinions and other items set forth on the "Closing Checklist" delivered by the
Agent to ATI prior to the Effective Date.
The acceptance by the Borrowers of any Credit Extension made on the
Effective Date shall be deemed to be a representation and warranty made by the
Borrowers to the effect that all of the conditions precedent to the making of
such Credit Extension have been satisfied, with the same effect as delivery to
the Agent and the Lenders of a certificate signed by a Responsible Officer of
each Borrower, dated the Effective Date, to such effect.
Execution and delivery to the Agent by a Lender of a counterpart of
this Agreement shall be deemed confirmation by such Lender that (i) all
conditions precedent in this Section 8.1 have been fulfilled to the
satisfaction of such Lender, (ii) the decision of such Lender to execute and
deliver to the Agent an executed counterpart of this Agreement was made by such
Lender independently and without reliance on the Agent or any other Lender as
to the satisfaction of any condition precedent set forth in this Section 8.1,
and (iii) all documents sent to such Lender for approval consent, or
satisfaction were acceptable to such Lender.
8.2 Conditions Precedent to Each Loan. The obligation of the Lenders
to make each Loan, including the initial Revolving Loans on the Effective Date,
and the obligation of the Agent to cause the Letter of Credit Issuer to issue
or permit the renewal (automatic or otherwise) of any Letter of Credit shall be
subject to the further conditions precedent that on and as of the date of any
such Borrowing:
(a) The following statements shall be true, and the acceptance
by any Borrower of any Credit Extension shall be deemed to be a statement to
the effect set forth in clauses (i), (ii) and (iii) with the same effect as the
delivery to the Agent and the Lenders of a certificate signed by a Responsible
Officer, dated the date of such Borrowing, stating that:
(i) The representations and warranties contained in this
Agreement and the other Loan Documents are correct in all material respects on
and as of the date of such Credit Extension and are deemed made on and as of
such date, other than any such representation or warranty which relates to a
specified prior date and except to the extent the Agent and the Lenders have
been notified in writing by any Borrower that any representation or warranty is
not correct and the Required Lenders have explicitly waived in writing
compliance with such representation or warranty; and
(ii) No event has occurred and is continuing, or would
result from such Credit Extension, which constitutes a Default or an Event of
Default; and
(iii) No event has occurred and is continuing, or would
result from such Credit Extension, which has had or would have a Material
Adverse Effect.
(b) No such Borrowing shall exceed Availability, provided,
however, that the foregoing conditions precedent are not conditions to each
Lender participating in or reimbursing the Bank or the Agent for such Lenders'
Pro Rata Share of any Non-Ratable Loan or Agent Advance made in accordance with
the provisions of Sections 1.2(h) and (i).
ARTICLE 9
DEFAULT; REMEDIES
9.1 Events of Default. It shall constitute an event of default ("Event
of Default") if any one or more of the following shall occur for any reason:
(a) any failure by any Borrower to pay (i) the principal of or
interest or premium on any of the Obligations or any fee when due, whether upon
demand or otherwise or (ii) any other amount owing hereunder when due, whether
upon demand or otherwise and such failure shall continue for a period of five
(5) or more Business Days;
(b) any representation or warranty made or deemed made by any
Borrower in this Agreement or by any Credit Party in any of the other Loan
Documents, any Financial Statement, or any certificate furnished by any
Borrower or any of its Subsidiaries at any time to the Agent or any Lender
shall prove to be untrue in any material respect as of the date on which made,
deemed made, or furnished;
(c) (i) any default shall occur in the observance or performance
of any of the covenants and agreements contained in Sections 7.2, 7.9 through
7.25 or 7.28 (including any corresponding default of the Parent under Section
4(g) of the Parent Guaranty), (ii) any default shall occur in the observance or
performance of any of the covenants and agreements contained in Sections 5.2,
5.3 or 7.5 (including any corresponding default of the Parent under Section
4(g) of the Parent Guaranty) and such default shall continue for five (5)
Business Days or more; or (iii) any default shall occur in the observance or
performance of any of the other covenants or agreements contained in any other
Section of this Agreement or any other Loan Document, or any other agreement
entered into at any time to which any Borrower or any Subsidiary and the Agent
or any Lender are party (excluding in respect of any Bank Products) and such
default shall continue for thirty (30) days or more after the occurrence
thereof;
(d) any default shall occur with respect to any Debt (other than
the Obligations) of any Borrower or any of its Subsidiaries in an outstanding
principal amount which exceeds $5,000,000 ("Material Debt"), or under any
agreement or instrument under or pursuant to which any such Material Debt may
have been issued, created, assumed, or guaranteed by any Borrower or any of its
Subsidiaries, and such default shall continue for more than the period of
grace, if any, therein specified, if the effect thereof (with or without the
giving of notice or further lapse of time or both) is to accelerate, or to
permit the holders of any such Material Debt to accelerate, the maturity of any
such Material Debt; or any such Material Debt shall be declared due and payable
or be required to be prepaid (other than by a regularly scheduled required
prepayment) prior to the stated maturity thereof;
(e) the Parent, any Borrower or any Subsidiary shall (i) file a
voluntary petition in bankruptcy or file a voluntary petition or an answer or
otherwise commence any action or proceeding seeking reorganization, arrangement
or readjustment of its debts or for any other relief under the Bankruptcy Code
or under any other bankruptcy or insolvency act or law, state or federal, now
or hereafter existing, or consent to, approve of, or acquiesce in, any such
petition, action or proceeding; (ii) apply for or acquiesce in the appointment
of a receiver, assignee, liquidator, sequestrator, custodian, monitor, trustee
or similar officer for it or for all or any part of its property; (iii) make an
assignment for the benefit of creditors; or (iv) be unable generally to pay its
debts as they become due;
(f) an involuntary petition shall be filed or an action or
proceeding otherwise commenced seeking reorganization, arrangement,
consolidation or readjustment of the debts of the Parent, any Borrower or any
Subsidiary or for any other relief under the Bankruptcy Code or under any other
bankruptcy or insolvency act or law, state or federal, now or hereafter
existing and such petition or proceeding shall continue in effect and not be
dismissed or stayed for a period of sixty (60) consecutive days after the
filing or commencement thereof, or an order of relief shall be entered with
respect thereto under the Bankruptcy Code;
(g) a receiver, assignee, liquidator, sequestrator, custodian,
monitor, trustee or similar officer for the Parent, any Borrower or any
Subsidiary or for all or any material part of its property shall be appointed
or a warrant of attachment, execution or similar process shall be issued
against any material part of the property of the Parent, any Borrower or any of
its Subsidiaries;
(h) the Parent, any Borrower or any Subsidiary shall file a
certificate of dissolution under applicable state law or shall be liquidated,
dissolved or wound-up or shall commence or have commenced against it any action
or proceeding for dissolution, winding-up or liquidation, or shall take any
corporate action in furtherance thereof except as permitted by Section
7.16(a)(iii);
(i) all or any material part of the property of any Credit Party
shall be nationalized, expropriated or condemned, seized or otherwise
appropriated, or custody or control of such property or of such Credit Party
shall be assumed by any Governmental Authority or any court of competent
jurisdiction at the instance of any Governmental Authority, except where
contested in good faith by proper proceedings diligently pursued where a stay
of enforcement is in effect;
(j) any Loan Document shall be terminated, revoked or declared
void, invalid or unenforceable or challenged by any Borrower or any other
Credit Party;
(k) one or more judgments, orders, decrees or arbitration awards
is entered against any Credit Party involving in the aggregate liability (to
the extent not covered by independent third-party insurance as to which the
insurer does not dispute coverage) as to any single or related or unrelated
series of transactions, incidents or conditions, of $5,000,000 or more, and the
same shall remain unsatisfied, unvacated and unstayed pending appeal for a
period of sixty (60) days after the entry thereof;
(l) any loss, theft, damage or destruction of any item or items
of Collateral or other property of any Credit Party occurs which would
reasonably be expected to cause a Material Adverse Effect and is not adequately
covered by insurance;
(m) for any reason other than the failure of the Agent to take
any action available to it to maintain perfection of the Agent's Liens,
pursuant to the Loan Documents, any Loan Document ceases to be in full force
and effect or any Lien with respect to any material portion of the Collateral
intended to be secured thereby ceases to be, or is not, valid, perfected and
prior to all other Liens (other than Permitted Liens) or is terminated, revoked
or declared void;
(n) ERISA Liabilities. Any Termination Event occurs which will
or is reasonably likely to subject either ATI or an ERISA Affiliate to a
liability which will or is reasonably expected to have a Material Adverse
Effect; or
(o) there occurs a Change in Control.
9.2 Remedies.
(a) If a Default or an Event of Default exists and has not been
waived in accordance with this Agreement, the Agent may, in its discretion, and
shall, at the direction of the Required Lenders, do one or more of the
following at any time or times and in any order, without notice to or demand on
the Borrowers: (i) reduce the Total Facility Amount, or the advance rates
against Eligible Accounts used in computing the Borrowing Base, or reduce one
or more of the other elements used in computing the Borrowing Base; (ii)
restrict the amount of or refuse to make Revolving Loans; and (iii) restrict or
refuse to provide Letters of Credit. If an Event of Default exists, the Agent
shall, at the direction of the Required Lenders, do one or more of the
following, in addition to the actions described in the preceding sentence, at
any time or times and in any order, without notice to or demand on the
Borrowers: (A) terminate the Commitments and this Agreement; (B) declare any or
all Obligations to be immediately due and payable; provided, however, that upon
the occurrence of any Event of Default described in Sections 9.1(e), 9.1(f),
9.1(g), or 9.1(h) as to any Credit Party, the Commitments shall automatically
and immediately expire and all Obligations shall automatically become
immediately due and payable without notice or demand of any kind; (C) require
the Borrowers to cash collateralize all outstanding Letter of Credit
Obligations; and (D) pursue its other rights and remedies under the Loan
Documents and applicable law.
(b) If an Event of Default has occurred and is continuing: (i)
the Agent shall have for the benefit of the Lenders, in addition to all other
rights of the Agent and the Lenders, the rights and remedies of a secured party
under the Loan Documents and the UCC; (ii) the Agent may, at any time, take
possession of the Collateral and keep it on the applicable Borrower's premises,
at no cost to the Agent or any Lender, or remove any part of it to such other
place or places as the Agent may desire, or the applicable Borrower shall, upon
the Agent's demand, at such Borrower's cost, assemble the Collateral and make
it available to the Agent at a place reasonably convenient to the Agent; and
(iii) the Agent may sell and deliver any Collateral at public or private sales,
for cash, upon credit or otherwise, at such prices and upon such terms as the
Agent deems advisable in its sole discretion and may, if the Agent deems it
reasonable, postpone or adjourn any sale of the Collateral by an announcement
at the time and place of sale or of such postponed or adjourned sale without
giving a new notice of sale. Without in any way requiring notice to be given in
the following manner, each Borrower agrees that any notice by the Agent of
sale, disposition or other intended action hereunder or in connection herewith,
whether required by the UCC or otherwise, shall constitute reasonable notice to
such Borrower if such notice is mailed by registered or certified mail, return
receipt requested, postage prepaid, or is delivered personally against receipt,
at least ten (10) Business Days prior to such action to such Borrower's address
specified in or pursuant to Section 13.8. If any Collateral is sold on terms
other than payment in full at the time of sale, no credit shall be given
against the Obligations until the Agent or the Lenders receive payment, and if
the buyer defaults in payment, the Agent may resell the Collateral without
further notice to such Borrower. In the event the Agent seeks to take
possession of all or any portion of the Collateral by judicial process, each
Borrower irrevocably waives: (A) the posting of any bond, surety or security
with respect thereto which might otherwise be required; (B) any demand for
possession prior to the commencement of any suit or action to recover the
Collateral; and (C) any requirement that the Agent retain possession and not
dispose of any Collateral until after trial or final judgment. Each Borrower
agrees that the Agent has no obligation to preserve rights to the Collateral or
marshal any Collateral for the benefit of any Person. To the extent not
prohibited by applicable law or by any material contract of any Credit Party,
the Agent is hereby granted a license or other right to use, without charge,
such Borrower's labels, patents, copyrights, name, trade secrets, trade names,
trademarks, and advertising matter, or any similar property, in completing
production of, advertising or selling any Collateral, and such Borrower's
rights under all licenses and all franchise agreements shall inure to the
Agent's benefit for such purpose. The proceeds of sale shall be applied first
to all expenses of sale, including attorneys' fees, and then to the
Obligations. The Agent will return any excess to such Borrower and such
Borrower shall remain liable for any deficiency.
(c) If an Event of Default occurs and is continuing, each
Borrower hereby waives all rights to notice and hearing prior to the exercise
by the Agent of the Agent's rights to repossess the Collateral without judicial
process or to reply, attach or levy upon the Collateral without notice or
hearing.
ARTICLE 10
TERM AND TERMINATION
10.1 Term and Termination. The term of this Agreement shall end on the
Stated Termination Date unless sooner terminated in accordance with the terms
hereof. The Agent upon direction from the Required Lenders may terminate this
Agreement without notice upon the occurrence and during the continuance of an
Event of Default. Upon the effective date of termination of this Agreement for
any reason whatsoever, all Obligations (including all unpaid principal, accrued
and unpaid interest and any early termination or prepayment fees or penalties
(but excluding obligations under Bank Products)) shall become immediately due
and payable and the Borrowers shall immediately arrange for the Letters of
Credit then outstanding to be Fully Supported. Notwithstanding the termination
of this Agreement and subject to any provisions of this Agreement that
expressly survive termination hereof, until all Obligations are indefeasibly
paid and performed in full in cash, each Borrower shall remain bound by the
terms of this Agreement and shall not be relieved of any of its Obligations
hereunder or under any other Loan Document, and the Agent and the Lenders shall
retain all their rights and remedies hereunder (including the Agent's Liens in
and all rights and remedies with respect to all then existing and after-arising
Collateral).
ARTICLE 11
AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS
11.1 Amendments and Waivers.
(a) No amendment or waiver of any provision of this Agreement or
any other Loan Document, and no consent with respect to any departure by any
Borrower or any other Credit Party therefrom, shall be effective unless the
same shall be in writing and signed by the Required Lenders (or by the Agent at
the written request of the Required Lenders) and each Borrower and then any
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however, that no such waiver,
amendment, or consent shall, unless in writing and signed by all the Lenders
and each Borrower and acknowledged by the Agent, do any of the following:
(i) increase or extend the Commitment of any Lender;
(ii) postpone or delay any date fixed by this Agreement
or any other Loan Document for any payment of principal, interest, fees or
other amounts due to the Lenders (or any of them) hereunder or under any other
Loan Document;
(iii) reduce the principal of, or the rate of interest
specified herein on any Loan, or any fees or other amounts payable hereunder or
under any other Loan Document;
(iv) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans which is required for the
Lenders or any of them to take any action hereunder;
(v) increase any of the percentages set forth in the
definition of the Borrowing Base or in the proviso to Section 1.2(i);
(vi) amend this Section or any provision of this
Agreement providing for consent or other action by all Lenders;
(vii) release any Borrower or any Guaranties of the
Obligations or release Collateral other than as permitted by Sections
7.16(a)(iii) and 12.11;
(viii) change the definition of "Required Lenders"; or
(ix) increase the Total Facility Amount or Letter of
Credit Subfacility;
provided, however, the Agent may, in its sole discretion and notwithstanding
the limitations contained in clauses (v) and (ix) above and any other terms of
this Agreement, make Agent Advances in accordance with Section 1.2(i) and,
provided further, that no amendment, waiver or consent shall, unless in
writing and signed by the Agent, affect the rights or duties of the Agent
under this Agreement or any other Loan Document and provided further, that
Schedule 1.1 hereto (Commitments) may be amended from time to time by Agent
alone to reflect assignments of Commitments in accordance herewith.
(b) If any fees are paid to the Lenders as consideration for
amendments, waivers or consents with respect to this Agreement, at Agent's
election, such fees may be paid only to those Lenders that agree to such
amendments, waivers or consents within the time specified for submission
thereof.
(c) If, in connection with any proposed amendment, waiver or
consent (a "Proposed Change") requiring the consent of all Lenders, the consent
of Required Lenders is obtained, but the consent of other Lenders is not
obtained (any such Lender whose consent is not obtained as described in this
clause (c) being referred to as a "Non-Consenting Lender"), then, so long as
the Agent is not a Non-Consenting Lender, at the Borrowers' request, the Agent
or an Eligible Assignee shall have the right (but not the obligation) with the
Agent's approval, to purchase from the Non-Consenting Lenders, and the
Non-Consenting Lenders agree that they shall sell, all the Non-Consenting
Lenders' Commitments for an amount equal to the principal balances thereof and
all accrued interest and fees with respect thereto through the date of sale
pursuant to Assignment and Acceptance Agreement(s), without premium or
discount.
11.2 Assignments; Participations.
(a) Any Lender may assign and delegate to one or more Eligible
Assignees (each an "Assignee") all, or any ratable part of all, of the Loans,
the Commitments and the other rights and obligations of such Lender hereunder,
in a minimum amount of $1,000,000 (provided that, unless an assignor Lender has
assigned and delegated all of its Loans and Commitments, no such assignment
and/or delegation shall be permitted unless, after giving effect thereto, such
assignor Lender retains a Commitment in a minimum amount of $5,000,000);
provided, however, that the Borrowers and the Agent may continue to deal solely
and directly with such Lender in connection with the interest so assigned to an
Assignee until (i) written notice of such assignment, together with payment
instructions, addresses and related information with respect to the Assignee,
shall have been given to the Borrowers (or ATI on behalf of the Borrowers) and
the Agent by such Lender and the Assignee; (ii) such Lender and its Assignee
shall have delivered to the Borrowers (or ATI on behalf of the Borrowers) and
the Agent an Assignment and Acceptance in the form of Exhibit F ("Assignment
and Acceptance") together with any note or notes subject to such assignment and
(iii) the assignor Lender or Assignee has paid to the Agent a processing fee in
the amount of $3,500. Each Borrower agrees to promptly execute and deliver
promissory notes and replacement promissory notes as reasonably requested by
the Agent or any Lender to evidence assignments of the Loans and Commitments in
accordance herewith.
(b) From and after the date that the Agent notifies the assignor
Lender that it has received an executed Assignment and Acceptance and payment
of the above-referenced processing fee, (i) the Assignee thereunder shall be a
party hereto and, to the extent that rights and obligations, including, but not
limited to, the obligation to participate in Letters of Credit have been
assigned to it pursuant to such Assignment and Acceptance, shall have the
rights and obligations of a Lender under the Loan Documents, and (ii) the
assignor Lender shall, to the extent that rights and obligations hereunder and
under the other Loan Documents have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement (and in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto).
(c) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the Assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than
as provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto or the attachment, perfection, or priority of any Lien granted
by any Borrower to the Agent or any Lender in the Collateral; (ii) such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Borrower or the
performance or observance by any Borrower of any of its obligations under this
Agreement or any other Loan Document furnished pursuant hereto; (iii) such
Assignee confirms that it has received a copy of this Agreement, together with
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance;
(iv) such Assignee will, independently and without reliance upon the Agent,
such assigning Lender or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (v) such
Assignee appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are delegated to the
Agent by the terms hereof, together with such powers, including the
discretionary rights and incidental power, as are reasonably incidental
thereto; and (vi) such Assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.
(d) Immediately upon satisfaction of the requirements of Section
11.2(a), this Agreement shall be deemed to be amended to the extent, but only
to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Commitments arising therefrom. The Commitment
allocated to each Assignee shall reduce such Commitments of the assigning
Lender pro tanto.
(e) Any Lender may at any time sell to one or more commercial
banks, financial institutions, or other Persons not Affiliates of any Borrower
(a "Participant") participating interests in any Loans, the Commitment of that
Lender and the other interests of that Lender (the "originating Lender")
hereunder and under the other Loan Documents; provided, however, that (i) the
originating Lender's obligations under this Agreement shall remain unchanged,
(ii) the originating Lender shall remain solely responsible for the performance
of such obligations, (iii) the Borrowers and the Agent shall continue to deal
solely and directly with the originating Lender in connection with the
originating Lender's rights and obligations under this Agreement and the other
Loan Documents, and (iv) no Lender shall transfer or grant any participating
interest under which the Participant has rights to approve any amendment to, or
any consent or waiver with respect to, this Agreement or any other Loan
Document except the matters set forth in Section 11.1(a)(i), (ii) and (iii),
and (v) all amounts payable by the Borrowers hereunder shall be determined as
if such Lender had not sold such participation; except that, if amounts
outstanding under this Agreement are due and unpaid, or shall have become due
and payable upon the occurrence of an Event of Default, each Participant shall
be deemed to have the right of set-off in respect of its participating interest
in amounts owing under this Agreement to the same extent and subject to the
same limitation as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement. If a Lender sells a
participating interest in its Loans, commitments or other interests hereunder
as described above, such Lender shall thereafter maintain at its address
specified on the signature pages hereto, as agent for the Borrowers, a register
(the "Participation Register") for the recordation of the names and addresses
of each Participant and the principal amounts of each such participation. A
Participant may not, with respect to such participation, enter into any
subparticipation or otherwise subdivide, sell, transfer or assign any of its
rights therein without prior written consent of the applicable Lender, which
consent shall not be unreasonably withheld or delayed. In the event that the
Lender consents to the proposed subparticipation, sale, transfer or assignment
of or with respect to any participation (any such subdivision, sale, transfer
or assignment, a "Transfer"), the Lender shall thereafter maintain at its
address specified on the signature pages hereto a copy of the written consent
to such Transfer sand shall record the names and addresses of each transferee
(a "Transferee") and the principal amount of each such Transfer in the
Participation Register.
(f) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.
ARTICLE 12
THE AGENT
12.1 Appointment and Authorization. Each Lender hereby designates and
appoints Bank as its Agent under this Agreement and the other Loan Documents
and each Lender hereby irrevocably authorizes the Agent to take such action on
its behalf under the provisions of this Agreement and each other Loan Document
and to exercise such powers and perform such duties as are expressly delegated
to it by the terms of this Agreement or any other Loan Document, together with
such powers as are reasonably incidental thereto. The Agent agrees to act as
such on the express conditions contained in this Article 12. Except for Section
12.10, the provisions of this Article 12 are solely for the benefit of the
Agent and the Lenders and the Borrowers shall have no rights as a third party
beneficiary of any of the provisions contained herein. Notwithstanding any
provision to the contrary contained elsewhere in this Agreement or in any other
Loan Document, the Agent shall not have any duties or responsibilities, except
those expressly set forth herein, nor shall the Agent have or be deemed to have
any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Agent. Without limiting the generality of the foregoing sentence, the use of
the term "agent" in this Agreement with reference to the Agent is not intended
to connote any fiduciary or other implied (or express) obligations arising
under agency doctrine of any applicable law. Instead, such term is used merely
as a matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties. Except as
expressly otherwise provided in this Agreement, the Agent shall have and may
use its sole discretion with respect to exercising or refraining from
exercising any discretionary rights or taking or refraining from taking any
actions which the Agent is expressly entitled to take or assert under this
Agreement and the other Loan Documents, including (a) the determination of the
applicability of ineligibility criteria with respect to the calculation of the
Borrowing Base, (b) the making of Agent Advances pursuant to Section 1.2(i),
and (c) the exercise of remedies pursuant to Section 9.2, and any action so
taken or not taken shall be deemed consented to by the Lenders.
12.2 Delegation of Duties. The Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects as
long as such selection was made without gross negligence or willful misconduct.
12.3 Liability of Agent. None of the Agent-Related Persons shall (i)
be liable for any action taken or omitted to be taken by any of them under or
in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or
willful misconduct), or (ii) be responsible in any manner to any of the Lenders
for any recital, statement, representation or warranty made by any Borrower or
any Subsidiary or Affiliate of any Borrower, or any officer thereof, contained
in this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan Document,
or the validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other Loan Document, or for any failure of any Borrower
or any other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Lender
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Borrower or any
of any Borrower's Subsidiaries or Affiliates.
12.4 Reliance by Agent. The Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to the Borrowers), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement or any other Loan Document in accordance with
a request or consent of the Required Lenders (or all Lenders if so required by
Section 11.1) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Lenders.
12.5 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default,
unless the Agent shall have received written notice from a Lender or any
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default." The Agent will
notify the Lenders of its receipt of any such notice. The Agent shall take such
action with respect to such Default or Event of Default as may be requested by
the Required Lenders in accordance with Section 9; provided, however, that
unless and until the Agent has received any such request, the Agent may (but
shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable.
12.6 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that
no act by the Agent hereinafter taken, including any review of the affairs of
any Borrower and its respective Affiliates, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to the Agent that it has, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
has deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of each Borrower and its respective Affiliates, and all
applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to the Borrowers. Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to
make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrowers. Except for notices, reports and other
documents expressly herein required to be furnished to the Lenders by the
Agent, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any
Borrower which may come into the possession of any of the Agent-Related
Persons.
12.7 Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Borrowers and without limiting the obligation of the Borrowers to do so), in
accordance with their Pro Rata Shares, from and against any and all Indemnified
Liabilities as such term is defined in Section 13.11; provided, however, that no
Lender shall be liable for the payment to the Agent-Related Persons of any
portion of such Indemnified Liabilities resulting directly from such
Agent-Related Person's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender shall reimburse the Agent upon demand
for its Pro Rata Share of any costs or out-of-pocket expenses (including
Attorney Costs) incurred by the Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein, to the
extent that the Agent is not reimbursed for such expenses by or on behalf of the
Borrowers. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Agent.
12.8 Agent in Individual Capacity. The Bank and its Affiliates may
make loans to, issue letters of credit for the account of, accept deposits
from, acquire equity interests in and generally engage in any kind of banking,
trust, financial advisory, underwriting or other business with any Borrower and
its respective Subsidiaries and Affiliates as though the Bank were not the
Agent hereunder and without notice to or consent of the Lenders. The Bank or
its Affiliates may receive information regarding any Borrower, its respective
Affiliates and Account Debtors (including information that may be subject to
confidentiality obligations in favor of such Borrower or such Subsidiary) and
acknowledge that the Agent and the Bank shall be under no obligation to provide
such information to them. With respect to its Loans, the Bank shall have the
same rights and powers under this Agreement as any other Lender and may
exercise the same as though it were not the Agent, and the terms "Lender" and
"Lenders" include the Bank in its individual capacity.
12.9 Successor Agent. The Agent may resign as Agent upon at least 30
days' prior notice to the Lenders and the Borrowers (or to ATI on behalf of the
Borrowers), such resignation to be effective upon the acceptance of a successor
agent to its appointment as Agent. In the event the Bank sells all of its
Commitment and Revolving Loans as part of a sale, transfer or other disposition
by the Bank of substantially all of its loan portfolio, the Bank shall resign
as Agent and such purchaser or transferee shall become the successor Agent
hereunder. Subject to the foregoing, if the Agent resigns under this Agreement,
the Required Lenders shall appoint from among the Lenders a successor agent for
the Lenders reasonably acceptable to the Borrowers. If no successor agent is
appointed prior to the effective date of the resignation of the Agent, the
Agent may appoint, after consulting with the Lenders and the Borrowers, a
successor agent from among the Lenders. Upon the acceptance of its appointment
as successor agent hereunder, such successor agent shall succeed to all the
rights, powers and duties of the retiring Agent and the term "Agent" shall mean
such successor agent and the retiring Agent's appointment, powers and duties as
Agent shall be terminated. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article 12 shall continue to inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement.
12.10 Withholding Tax.
(a) If any Non-U.S. Lender claims exemption from, or a reduction
of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such Non-U.S.
Lender agrees with and in favor of the Agent, to deliver to the Agent and the
Borrowers (or ATI on behalf of the Borrowers):
(i) if such Non-U.S. Lender claims an exemption from, or
a reduction of, withholding tax under a United States of America tax treaty,
properly completed IRS Forms W-8BEN and W-8ECI before the payment of any
interest in the first calendar year and before the payment of any interest in
each third succeeding calendar year during which interest may be paid under
this Agreement;
(ii) if such Non-U.S. Lender claims that interest paid
under this Agreement is exempt from United States of America withholding tax
because it is effectively connected with a United States of America trade or
business of such Non-U.S. Lender, two properly completed and executed copies of
IRS Form W-8ECI before the payment of any interest is due in the first taxable
year of such Non-U.S. Lender and in each succeeding taxable year of such
Non-U.S. Lender during which interest may be paid under this Agreement, and IRS
Form W-9; and
(iii) such other form or forms as may be required under
the Code or other laws of the United States of America as a condition to
exemption from, or reduction of, United States of America withholding tax.
Such Non-U.S. Lender agrees to promptly notify the Agent and the Borrowers (or
ATI on behalf of the Borrowers) of any change in circumstances which would
modify or render invalid any claimed exemption or reduction.
(b) If any Non-U.S. Lender claims exemption from, or reduction
of, withholding tax under a United States of America tax treaty by providing
IRS Form W-8BEN and such Non-U.S. Lender sells, assigns, grants a participation
in, or otherwise transfers all or part of the Obligations owing to such
Non-U.S. Lender (including any transfer of the Obligations to a new lending
office of such Non-U.S. Lender), such Non-U.S. Lender agrees to notify the
Agent of the percentage amount in which it is no longer the beneficial owner of
Obligations of the Borrowers to such Non-U.S. Lender. To the extent of such
percentage amount, the Agent will treat such Non-U.S. Lender's IRS Form W-8BEN
as no longer valid.
(c) If any Non-U.S. Lender claiming exemption from United States
of America withholding tax by filing IRS Form W-8ECI with the Agent sells,
assigns, grants a participation in, or otherwise transfers all or part of the
Obligations owing to such Non-U.S. Lender, such Non-U.S. Lender agrees to
undertake sole responsibility for complying with the withholding tax
requirements imposed by Sections 1441 and 1442 of the Code.
(d) If any Non-U.S. Lender is entitled to a reduction in the
applicable withholding tax, the Agent may withhold from any interest payment to
such Non-U.S. Lender an amount equivalent to the applicable withholding tax
after taking into account such reduction. If the forms or other documentation
required by subsection (a) of this Section are not delivered to the Agent, then
the Agent may withhold from any interest payment to such Non-U.S. Lender not
providing such forms or other documentation an amount equivalent to the
applicable withholding tax without reduction. The Borrowers shall have no
liability under Section 4.1 or otherwise with respect to amounts paid by the
Agent pursuant to this Section 12.10(d).
(e) If the IRS or any other Governmental Authority of the United
States of America or other jurisdiction asserts a claim that the Agent and/or
any Borrower, as applicable did not properly withhold tax from amounts paid to
or for the account of any Non-U.S. Lender (because the appropriate form was not
delivered, was not properly executed, or because such Non-U.S. Lender failed to
notify the Agent and/or such Borrower, as applicable of a change in
circumstances which rendered the exemption from, or reduction of, withholding
tax ineffective, or for any other reason) such Non-U.S. Lender shall indemnify
the Agent and/or such Borrower, as applicable fully for all amounts paid,
directly or indirectly, by the Agent and/or such Borrower, as applicable as tax
or otherwise, including penalties and interest, and including any taxes imposed
by any jurisdiction on the amounts payable to the Agent and/or such Borrower,
as applicable under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Non-U.S. Lenders under this
subsection shall survive the payment of all Obligations and the resignation or
replacement of the Agent.
12.11 Collateral Matters.
(a) The Lenders hereby irrevocably authorize the Agent, at its
option and in its sole discretion, to release any Agent's Liens upon any
Collateral (i) upon the termination of the Commitments and payment and
satisfaction in full by Borrower of all Loans and reimbursement obligations in
respect of Letters of Credit, and the termination of all outstanding Letters of
Credit (whether or not any of such obligations are due) and all other
Obligations; (ii) constituting property being sold or disposed of if such
Borrower certifies to the Agent that the sale or disposition is made in
compliance with Section 7.10 (and the Agent may rely conclusively on any such
certificate, without further inquiry); (iii) constituting property in which
such Borrower owned no interest at the time the Lien was granted or at any time
thereafter; or (iv) constituting property leased to such Borrower under a lease
which has expired or been terminated in a transaction permitted under this
Agreement. Except as provided above, the Agent will not release any of the
Agent's Liens without the prior written authorization of the Lenders; provided
that the Agent may, in its discretion, release the Agent's Liens on Collateral
valued in the aggregate not in excess of $5,000,000 during each Fiscal Year
without the prior written authorization of the Lenders and the Agent may
release the Agent's Liens on Collateral valued in the aggregate not in excess
of $10,000,000 during each Fiscal Year with the prior written authorization of
Required Lenders. Upon request by the Agent or the Borrowers at any time, the
Lenders will confirm in writing the Agent's authority to release any Agent's
Liens upon particular types or items of Collateral pursuant to this Section
12.11.
(b) Upon receipt by the Agent of any authorization required
pursuant to Section 12.11(a) from the Lenders of the Agent's authority to
release Agent's Liens upon particular types or items of Collateral, and upon at
least five (5) Business Days prior written request by the Borrowers, the Agent
shall (and is hereby irrevocably authorized by the Lenders to) execute such
documents as may be necessary to evidence the release of the Agent's Liens upon
such Collateral; provided, however, that (i) the Agent shall not be required to
execute any such document on terms which, in the Agent's opinion, would expose
the Agent to liability or create any obligation or entail any consequence other
than the release of such Liens without recourse or warranty, and (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens (other than those expressly being released) upon (or obligations of
the Borrowers in respect of) all interests retained by such Borrower, including
the proceeds of any sale, all of which shall continue to constitute part of the
Collateral.
(c) The Agent shall have no obligation whatsoever to any of the
Lenders to assure that the Collateral exists or is owned by any Borrower or is
cared for, protected or insured or has been encumbered, or that the Agent's
Liens have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to
exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to the Agent pursuant to any of the
Loan Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission or event related thereto, the Agent may act in
any manner it may deem appropriate, in its sole discretion given the Agent's
own interest in the Collateral in its capacity as one of the Lenders and that
the Agent shall have no other duty or liability whatsoever to any Lender as to
any of the foregoing.
12.12 Restrictions on Actions by Lenders; Sharing of Payments.
(a) Each of the Lenders agrees that it shall not, without the
express consent of the Agent and the Required Lenders, and that it shall, to the
extent it is lawfully entitled to do so, upon the request of the Agent and the
Required Lenders, set off against the Obligations, any amounts owing by such
Lender to any Borrower or any accounts of any Borrower now or hereafter
maintained with such Lender. Each of the Lenders further agrees that it shall
not, unless specifically requested to do so by the Agent, take or cause to be
taken any action to enforce its rights under this Agreement or against any
Borrower, including the commencement of any legal or equitable proceedings, to
foreclose any Lien on, or otherwise enforce any security interest in, any of the
Collateral.
(b) If at any time or times any Lender shall receive (i) by
payment, foreclosure, setoff or otherwise, any proceeds of Collateral or any
payments with respect to the Obligations of any Borrower to such Lender arising
under, or relating to, this Agreement or the other Loan Documents, except for
any such proceeds or payments received by such Lender from the Agent pursuant
to the terms of this Agreement, or (ii) payments from the Agent in excess of
such Lender's ratable portion of all such distributions by the Agent, such
Lender shall promptly (1) turn the same over to the Agent, in kind, and with
such endorsements as may be required to negotiate the same to the Agent, or in
same day funds, as applicable, for the account of all of the Lenders and for
application to the Obligations in accordance with the applicable provisions of
this Agreement, or (2) purchase, without recourse or warranty, an undivided
interest and participation in the Obligations owed to the other Lenders so that
such excess payment received shall be applied ratably as among the Lenders in
accordance with their Pro Rata Shares; provided, however, that if all or part
of such excess payment received by the purchasing party is thereafter recovered
from it, those purchases of participations shall be rescinded in whole or in
part, as applicable, and the applicable portion of the purchase price paid
therefor shall be returned to such purchasing party, but without interest
except to the extent that such purchasing party is required to pay interest in
connection with the recovery of the excess payment.
12.13 Agency for Perfection. Each Lender hereby appoints the Agent and
each other Lender as agent for the purpose of perfecting the Lenders' security
interest in assets which, in accordance with Article 9 of the UCC can be
perfected only by possession. Should any Lender (other than the Agent) obtain
possession of any such Collateral, such Lender shall notify the Agent thereof,
and, promptly upon the Agent's request therefor shall deliver such Collateral
to the Agent or in accordance with the Agent's instructions.
12.14 Payments by Agent to Lenders. All payments to be made by the
Agent to the Lenders shall be made by bank wire transfer or internal transfer
of immediately available funds to each Lender pursuant to wire transfer
instructions delivered in writing to the Agent on or prior to the Effective
Date (or if such Lender is an Assignee, on the applicable Assignment and
Acceptance), or pursuant to such other wire transfer instructions as each party
may designate for itself by written notice to the Agent. Concurrently with each
such payment, the Agent shall identify whether such payment (or any portion
thereof) represents principal, premium or interest on the Revolving Loans
otherwise. Unless the Agent receives notice from any Borrower prior to the date
on which any payment is due to the Lenders that such Borrower will not make
such payment in full as and when required, the Agent may assume that such
Borrower has made such payment in full to the Agent on such date in immediately
available funds and the Agent may (but shall not be so required), in reliance
upon such assumption, distribute to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent such Borrower
has not made such payment in full to the Agent, each Lender shall repay to the
Agent on demand such amount distributed to such Lender, together with interest
thereon at the Federal Funds Rate for each day from the date such amount is
distributed to such Lender until the date repaid.
12.15 Settlement.
(a) (i) Each Lender's funded portion of the Revolving Loans is
intended by the Lenders to be equal at all times to such Lender's Pro Rata
Share of the outstanding Revolving Loans. Notwithstanding such agreement, the
Agent, the Bank, and the other Lenders agree (which agreement shall not be for
the benefit of or enforceable by the Borrowers) that in order to facilitate the
administration of this Agreement and the other Loan Documents, settlement among
them as to the Revolving Loans, the Non-Ratable Loans and the Agent Advances
shall take place on a periodic basis in accordance with the following
provisions:
(ii) The Agent shall request settlement ("Settlement")
with the Lenders on at least a weekly basis, or on a more frequent basis at
Agent's election, (A) on behalf of the Bank, with respect to each outstanding
Non-Ratable Loan, (B) for itself, with respect to each Agent Advance, and (C)
with respect to collections received, in each case, by notifying the Lenders of
such requested Settlement by telecopy, telephone or other similar form of
transmission, of such requested Settlement, no later than 12:00 noon (New York
City time) on the date of such requested Settlement (the "Settlement Date").
Each Lender (other than the Bank, in the case of Non-Ratable Loans and the
Agent in the case of Agent Advances) shall transfer the amount of such Lender's
Pro Rata Share of the outstanding principal amount of the Non-Ratable Loans and
Agent Advances with respect to each Settlement to the Agent, to Agent's
account, not later than 2:00 p.m. (New York City time), on the Settlement Date
applicable thereto. Settlements may occur during the continuation of a Default
or an Event of Default and whether or not the applicable conditions precedent
set forth in Article 8 have then been satisfied. Such amounts made available to
the Agent shall be applied against the amounts of the applicable Non-Ratable
Loan or Agent Advance and, together with the portion of such Non-Ratable Loan
or Agent Advance representing the Bank's Pro Rata Share thereof, shall
constitute Revolving Loans of such Lenders. If any such amount required
hereunder to be so transferred is not transferred to the Agent by any Lender on
the Settlement Date applicable thereto, the Agent shall be entitled to recover
such amount on demand from such Lender together with interest thereon at the
Federal Funds Rate for the first three (3) days from and after the Settlement
Date and thereafter at the Interest Rate then applicable to the Revolving Loans
(A) on behalf of the Bank, with respect to each outstanding Non-Ratable Loan,
and (B) for itself, with respect to each Agent Advance, but only to the extent
such amount is not paid by such Borrower.
(iii) Notwithstanding the foregoing, not more than one
(1) Business Day after demand is made by the Agent (whether before or after the
occurrence of a Default or an Event of Default and regardless of whether the
Agent has requested a Settlement with respect to a Non-Ratable Loan or Agent
Advance), each other Lender (A) shall irrevocably and unconditionally purchase
and receive from the Bank or the Agent, as applicable, without recourse or
warranty, an undivided interest and participation in such Non-Ratable Loan or
Agent Advance equal to such Lender's Pro Rata Share of such Non-Ratable Loan or
Agent Advance and (B) if Settlement has not previously occurred with respect to
such Non-Ratable Loans or Agent Advances, upon demand by Bank or Agent, as
applicable, shall pay to Bank or Agent, as applicable, as the purchase price of
such participation an amount equal to one-hundred percent (100%) of such
Lender's Pro Rata Share of such Non-Ratable Loans or Agent Advances. If such
amount is not in fact made available to the Agent by any Lender, the Agent
shall be entitled to recover such amount on demand from such Lender together
with interest thereon at the Federal Funds Rate for the first three (3) days
from and after such demand and thereafter at the Interest Rate then applicable
to Base Rate Loans, but only to the extent such amount is not paid by such
Borrower.
(iv) From and after the date, if any, on which any Lender
purchases an undivided interest and participation in any Non-Ratable Loan or
Agent Advance pursuant to clause (iii) above, the Agent shall promptly
distribute to such Lender, such Lender's Pro Rata Share of all payments of
principal and interest and all proceeds of Collateral received by the Agent in
respect of such Non-Ratable Loan or Agent Advance.
(v) Between Settlement Dates, the Agent, to the extent no
Agent Advances are outstanding, may pay over to the Bank any payments received
by the Agent, which in accordance with the terms of this Agreement would be
applied to the reduction of the Revolving Loans, for application to the Bank's
Revolving Loans including Non-Ratable Loans. If, as of any Settlement Date,
collections received since the then immediately preceding Settlement Date have
been applied to the Bank's Revolving Loans (other than to Non-Ratable Loans or
Agent Advances in which such Lender has not yet funded its purchase of a
participation pursuant to clause (iii) above), as provided for in the previous
sentence, the Bank shall pay to the Agent for the accounts of the Lenders, to
be applied to the outstanding Revolving Loans of such Lenders, an amount such
that each Lender shall, upon receipt of such amount, have, as of such
Settlement Date, its Pro Rata Share of the Revolving Loans. During the period
between Settlement Dates, the Bank with respect to Non-Ratable Loans, the Agent
with respect to Agent Advances, and each Lender with respect to the Revolving
Loans other than Non-Ratable Loans and Agent Advances, shall be entitled to
interest at the applicable rate or rates payable under this Agreement on the
actual average daily amount of funds employed by the Bank, the Agent and the
other Lenders.
(vi) Unless the Agent has received written notice from a
Lender to the contrary, the Agent may assume that the applicable conditions
precedent set forth in Article 8 have been satisfied and the requested
Borrowing will not exceed Availability on any Funding Date for a Revolving Loan
or Non-Ratable Loan.
(b) Lenders' Failure to Perform. All Revolving Loans (other than
Non-Ratable Loans and Agent Advances) shall be made by the Lenders
simultaneously and in accordance with their Pro Rata Shares. It is understood
that (i) no Lender shall be responsible for any failure by any other Lender to
perform its obligation to make any Revolving Loans hereunder, nor shall any
Commitment of any Lender be increased or decreased as a result of any failure
by any other Lender to perform its obligation to make any Revolving Loans
hereunder, (ii) no failure by any Lender to perform its obligation to make any
Revolving Loans hereunder shall excuse any other Lender from its obligation to
make any Revolving Loans hereunder, and (iii) the obligations of each Lender
hereunder shall be several, not joint and several.
(c) Defaulting Lenders. Unless the Agent receives notice from a
Lender on or prior to the Effective Date or, with respect to any Borrowing
after the Effective Date, at least one Business Day prior to the date of such
Borrowing, that such Lender will not make available as and when required
hereunder to the Agent that Lender's Pro Rata Share of a Borrowing, the Agent
may assume that each Lender has made such amount available to the Agent in
immediately available funds on the Funding Date. Furthermore, the Agent may, in
reliance upon such assumption, make available to the applicable Borrower on
such date a corresponding amount. If any Lender has not transferred, on the
date required hereunder, its full Pro Rata Share of any required funding to the
Agent in immediately available funds and the Agent has transferred the
corresponding amount to a Borrower, such Lender, on the Business Day following
such date, shall make such amount available to the Agent, together with
interest at the Federal Funds Rate for that day. A notice by the Agent
submitted to any Lender with respect to amounts owing shall be conclusive,
absent manifest error. If a Lender's full Pro Rata Share is transferred to the
Agent as required, the amount transferred to the Agent shall constitute that
Lender's Revolving Loan for all purposes of this Agreement. If that amount is
not transferred to the Agent on the Business Day following the Funding Date,
the Agent will notify the applicable Borrower of such failure to fund and, upon
demand by the Agent, such Borrower shall pay such amount to the Agent for the
Agent's account, together with interest thereon for each day elapsed since the
date of such Borrowing, at a rate per annum equal to the Interest Rate
applicable at the time to the Revolving Loans comprising that particular
Borrowing. The failure of any Lender to make any Revolving Loan on any Funding
Date (any such Lender, prior to the cure of such failure, being hereinafter
referred to as a "Defaulting Lender") shall not relieve any other Lender of its
obligation hereunder to make a Revolving Loan on that Funding Date. No Lender
shall be responsible for any other Lender's failure to advance such other
Lenders' Pro Rata Share of any Borrowing.
(d) Retention of Defaulting Lender's Payments. The Agent shall
not be obligated to transfer to a Defaulting Lender any payments made by any
Borrower to the Agent for the Defaulting Lender's benefit; nor shall a
Defaulting Lender be entitled to the sharing of any payments hereunder. Amounts
payable to a Defaulting Lender shall instead be paid to or retained by the
Agent. In its discretion, the Agent may loan any Borrower the amount of all
such payments received or retained by it for the account of such Defaulting
Lender. Any amounts so loaned to any Borrower shall bear interest at the rate
applicable to Base Rate Loans and for all other purposes of this Agreement
shall be treated as if they were Revolving Loans, provided, however, that for
purposes of voting or consenting to matters with respect to the Loan Documents
and determining Pro Rata Shares, such Defaulting Lender shall be deemed not to
be a "Lender". Until a Defaulting Lender cures its failure to fund its Pro Rata
Share of any Borrowing (A) such Defaulting Lender shall not be entitled to any
portion of the Unused Line Fee and (B) the Unused Line Fee shall accrue in
favor of the Lenders which have funded their respective Pro Rata Shares of such
requested Borrowing and shall be allocated among such performing Lenders
ratably based upon their relative Commitments. This Section shall remain
effective with respect to such Lender until such time as the Defaulting Lender
shall no longer be in default of any of its obligations under this Agreement.
The terms of this Section shall not be construed to increase or otherwise
affect the Commitment of any Lender, or relieve or excuse the performance by
any Borrower of its duties and obligations hereunder.
12.16 Letters of Credit; Intra-Lender Issues.
(a) Notice of Letter of Credit Balance. On each Settlement Date
the Agent shall notify each Lender of the issuance of all Letters of Credit
since the prior Settlement Date.
(b) Participations in Letters of Credit.
(i) Purchase of Participations. Immediately upon issuance
of any Letter of Credit in accordance with Section 1.4(d), each Lender shall be
deemed to have irrevocably and unconditionally purchased and received without
recourse or warranty, an undivided interest and participation equal to such
Lender's Pro Rata Share of the face amount of such Letter of Credit (including
all obligations of the applicable Borrower with respect thereto, and any
security therefor or guaranty pertaining thereto).
(ii) Sharing of Reimbursement Obligation Payments.
Whenever the Agent receives a payment from a Borrower on account of
reimbursement obligations in respect of a Letter of Credit as to which the
Agent has previously received for the account of a Letter of Credit Issuer
thereof payment from a Lender, the Agent shall promptly pay to such Lender such
Lender's Pro Rata Share of such payment from such Borrower. Each such payment
shall be made by the Agent on the next Settlement Date.
(iii) Documentation. Upon the request of any Lender, the
Agent shall, to the extent delivered to the Agent by the applicable Letter of
Credit Issuer, furnish to such Lender copies of any Letter of Credit,
reimbursement agreements executed in connection therewith, applications for any
Letter of Credit, and such other documentation as may reasonably be requested
by such Lender.
(iv) Obligations Irrevocable. The obligations of each
Lender to make payments to the Agent with respect to any Letter of Credit or
with respect to their participation therein or with respect to the Revolving
Loans made as a result of a drawing under a Letter of Credit and the
obligations of any Borrower for whose account the Letter of Credit was issued
to make payments to the Agent, for the account of the Lenders, shall be
irrevocable and shall not be subject to any qualification or exception
whatsoever, including any of the following circumstances:
(1) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(2) the existence of any claim, setoff, defense or
other right which such Borrower may have at any time against a
beneficiary named in a Letter of Credit or any transferee of any
Letter of Credit (or any Person for whom any such transferee may
be acting), any Lender, the Agent, the issuer of such Letter of
Credit, or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying
transactions between such Borrower or any other Person and the
beneficiary named in any Letter of Credit);
(3) any draft, certificate or any other document
presented under the Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(4) the surrender or impairment of any security for
the performance or observance of any of the terms of any of the
Loan Documents;
(5) the occurrence of any Default or Event of Default;
or
(6) the failure of such Borrower to satisfy the
applicable conditions precedent set forth in Article 8.
(c) Recovery or Avoidance of Payments; Refund of Payments In
Error. In the event any payment by or on behalf of a Borrower received by the
Agent with respect to any Letter of Credit and distributed by the Agent to the
Lenders on account of their respective participations therein is thereafter set
aside, avoided or recovered from the Agent in connection with any receivership,
liquidation or bankruptcy proceeding, the Lenders shall, upon demand by the
Agent, pay to the Agent their respective Pro Rata Shares of such amount set
aside, avoided or recovered, together with interest at the rate required to be
paid by the Agent upon the amount required to be repaid by it. Unless the Agent
receives notice from the applicable Borrower prior to the date on which any
payment is due to the Lenders that such Borrower will not make such payment in
full as and when required, the Agent may assume that such Borrower has made
such payment in full to the Agent on such date in immediately available funds
and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent such Borrower has not made
such payment in full to the Agent, each Lender shall repay to the Agent on
demand such amount distributed to such Lender, together with interest thereon
at the Federal Funds Rate for each day from the date such amount is distributed
to such Lender until the date repaid.
(d) Indemnification by Lenders. To the extent not reimbursed by
the Borrowers and without limiting the obligations of the Borrowers hereunder,
the Lenders agree to indemnify the Letter of Credit Issuer ratably in
accordance with their respective Pro Rata Shares, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees) or disbursements of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against the Letter
of Credit Issuer in any way relating to or arising out of any Letter of Credit
or the transactions contemplated thereby or any action taken or omitted by the
Letter of Credit Issuer under any Letter of Credit or any Loan Document in
connection therewith; provided that no Lender shall be liable for any of the
foregoing to the extent it arises from the gross negligence or willful
misconduct of the Letter of Credit Issuer to be indemnified. Without limitation
of the foregoing, each Lender agrees to reimburse the Letter of Credit Issuer
promptly upon demand for its Pro Rata Share of any costs or expenses payable by
any Borrower to the Letter of Credit Issuer, to the extent that the Letter of
Credit Issuer is not promptly reimbursed for such costs and expenses by such
Borrower. The agreement contained in this Section shall survive payment in full
of all other Obligations.
12.17 Concerning the Collateral and the Related Loan Documents. Each
Lender authorizes and directs the Agent to enter into the other Loan Documents,
for the ratable benefit and obligation of the Agent and the Lenders. Each
Lender agrees that any action taken by the Agent or the Required Lenders, as
applicable, in accordance with the terms of this Agreement or the other Loan
Documents, and the exercise by the Agent or the Required Lenders, as
applicable, of their respective powers set forth therein or herein, together
with such other powers that are reasonably incidental thereto, shall be binding
upon all of the Lenders. The Lenders acknowledge that the Revolving Loans,
reimbursement obligations under Letters of Credit, Agent Advances, Non-Ratable
Loans, Bank Products and all interest, fees and expenses hereunder constitute
one Debt, secured pari passu by all of the Collateral.
12.18 Field Audit and Examination Reports; Disclaimer by Lenders. By
signing this Agreement, each Lender:
(a) is deemed to have requested that the Agent furnish such
Lender, promptly after it becomes available, a copy of each field audit or
examination report (each a "Report" and collectively, "Reports") prepared by or
on behalf of the Agent;
(b) expressly agrees and acknowledges that neither the Bank nor
the Agent (i) makes any representation or warranty as to the accuracy of any
Report, or (ii) shall be liable for any information contained in any Report;
(c) expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that the Agent or the Bank or other party
performing any audit or examination will inspect only specific information
regarding the Borrowers and will rely significantly upon the Borrowers' books
and records, as well as on representations of the Borrowers' personnel; and
(d) without limiting the generality of any other indemnification
provision contained in this Agreement, agrees: (i) to hold the Agent and any
such other Lender preparing a Report harmless from any action the indemnifying
Lender may take or conclusion the indemnifying Lender may reach or draw from
any Report in connection with any loans or other credit accommodations that the
indemnifying Lender has made or may make to the Borrowers, or the indemnifying
Lender's participation in, or the indemnifying Lender's purchase of, a loan or
loans of any Borrower; and (ii) to pay and protect, and indemnify, defend and
hold the Agent and any such other Lender preparing a Report harmless from and
against, the claims, actions, proceedings, damages, costs, expenses and other
amounts (including Attorney Costs) incurred by the Agent and any such other
Lender preparing a Report as the direct or indirect result of any third parties
who might obtain all or part of any Report through the indemnifying Lender.
12.19 Relation Among Lenders. The Lenders are not partners or
co-venturers, and no Lender shall be liable for the acts or omissions of, or
(except as otherwise set forth herein in case of the Agent) authorized to act
for, any other Lender.
12.20 Co-Agents. None of the Lenders identified on the facing page or
signature pages of this Agreement as a "syndication agent" or a "documentation
agent" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement other than those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders so identified as a
"co-agent" or a "documentation agent" shall have or be deemed to have any
fiduciary relationship with any Lender. Each Lender acknowledges that it has
not relied, and will not rely, on any of the Lenders so identified in deciding
to enter into this Agreement or in taking or not taking action hereunder.
ARTICLE 13
GUARANTEES
13.1 Guaranty. Each Borrower hereby jointly and severally,
unconditionally, continually and irrevocably guarantees to the Agent, for its
benefit and the benefit of the Lenders and the Letter of Credit Issuers, the
full and prompt payment when due, whether at maturity or earlier, by reason of
acceleration, mandatory prepayment or otherwise, and in accordance with the
terms and conditions of this Agreement, of all of the Obligations, whether or
not from time to time reduced or extinguished or hereafter increased or
incurred, whether or not recovery may be or hereafter may become barred by any
statute of limitations, and whether enforceable or unenforceable as against any
other Borrower, now or hereafter existing, or due or to become due (all such
indebtedness, liabilities and obligations being hereinafter collectively
referred to as the "Guaranteed Obligations") This Section 13.1 continues,
reaffirms and amends, as the case may be, the guarantees under the Original
Subsidiary Agreements and the Restated Subsidiary Guaranty. Notwithstanding the
foregoing, the liability of each Borrower individually with respect to its
Guaranteed Obligations 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 United States Bankruptcy Code or any
comparable provisions of any applicable state law.
13.2 Contribution. The Borrowers hereby agree as among themselves
that, if any Borrower shall make an Excess Payment (as defined below), such
Borrower shall have a right of contribution from each other Borrower in an
amount equal to such other Borrower's Contribution Share (as defined below) of
such Excess Payment. The payment obligations of any Borrower under this
paragraph shall be subordinate and subject in right of payment to the
Guaranteed Obligations until such time as the Guaranteed Obligations have been
paid in full and all Commitments have been terminated, and none of the
Borrowers shall exercise any right or remedy under this paragraph against any
other Borrower until the Guaranteed Obligations have been paid in full and all
Commitments have been terminated. For purposes of this paragraph, (a) "Excess
Payment" shall mean the amount paid by any Borrower in excess of its Pro Rata
Guaranty Share of any Guaranteed Obligations; (b) "Pro Rata Guaranty Share"
shall mean, for any Borrower in respect of any payment of Obligations by such
Borrower, 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 Borrower (including contingent, subordinated,
unmatured and unliquidated liabilities, but excluding the obligations of such
Borrower hereunder) to (ii) the amount by which the aggregate present fair
salable value of all assets and other properties of all of the Borrowers
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of the Borrowers hereunder) of the Borrowers; provided, however,
that, for purpose of calculating the Pro Rata Guaranty Shares of the Borrowers
in respect of any payment of Guaranteed Obligations, any Borrower that became a
Borrower subsequent to the date of any such payment shall be deemed to have
been a Borrower on the date of such payment and the financial information for
such Borrower as of the date such Borrower became a Borrower shall be utilized
for such Borrower in connection with such payment; and (c) "Contribution Share"
shall mean, for any Borrower in respect of any Excess Payment made by any other
Borrower, 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 Borrower (including contingent, subordinated, unmatured and
unliquidated liabilities, but excluding the obligations of such Borrower
hereunder) to (ii) the amount by which the aggregate present fair salable value
of all assets and other properties of the Borrowers 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 Borrowers hereunder) of the Borrowers
other than the maker of such Excess Payment; provided, however, that, for
purposes of calculating the Contribution Shares of the Borrowers in respect of
any Excess Payment, any Borrower that became a Borrower subsequent to the date
of any such Excess Payment shall be deemed to have been a Borrower on the date
of such Excess Payment and the financial information for such Borrower as of
the date such Borrower became a Borrower shall be utilized for such Borrower in
connection with such Excess Payment.
13.3 Waivers; Other Agreements. (i) Subject to the terms hereof, the
Agent is hereby authorized by the Borrowers (subject to any additional
authorization required by the Lenders or the Required Lenders), without notice
to or demand upon any Borrower, which notice or demand is expressly waived
hereby, and without discharging or otherwise affecting the obligations of any
Borrower hereunder (which shall remain absolute and unconditional
notwithstanding any such action or omission to act), from time to time, to:
(A) supplement, renew, extend, accelerate or otherwise change
the time for payment of, or other terms relating to, the Guaranteed
Obligations, or otherwise modify, amend or change the terms of any
promissory note or other agreement, document or instrument (including
this Agreement and the other Loan Documents) now or hereafter executed
by any Borrower and delivered to the Agent, including, without
limitation, any increase or decrease of the rate of interest thereon;
(B) waive or otherwise consent to noncompliance with any
provision of any instrument evidencing the Guaranteed Obligations, or
any part thereof, or any other instrument or agreement in respect of
the Guaranteed Obligations (including this Agreement and the other
Loan Documents) now or hereafter executed by any Borrower and
delivered to the Agent;
(C) accept partial payments on the Guaranteed Obligations;
(D) receive, take and hold additional security or collateral for
the payment of the Guaranteed Obligations, or for the payment of any
other guaranties of the Guaranteed Obligations or other liabilities of
any Borrower, and exchange, enforce, waive, substitute, liquidate,
terminate, abandon, fail to perfect, subordinate, transfer, otherwise
alter and release any such additional security or collateral;
(E) apply any and all such security or collateral and direct the
order or manner of sale thereof as the Agent may determine in its sole
discretion;
(F) settle, release, compromise, collect or otherwise liquidate
the Guaranteed Obligations or accept, substitute, release, exchange or
otherwise alter, affect or impair any security or collateral for the
Guaranteed Obligations or any other guaranty therefor, in any manner;
(G) add, release or substitute any one or more other guarantors,
makers or endorsers of the Guaranteed Obligations and otherwise
enforce its rights under the Loan Documents against any Borrower or
any other guarantor, maker or endorser as the Agent may elect in its
sole discretion;
(H) apply any and all payments or recoveries from any Borrower,
from any other guarantor, maker or endorser of the Guaranteed
Obligations to the Obligations in such order as provided in Section
3.8 hereof, whether such Guaranteed Obligations are secured or
unsecured or guaranteed or not guaranteed by others;
(I) apply any and all payments or recoveries from any Borrower
or any other guarantor, maker or endorser of the Guaranteed
Obligations or sums realized from security furnished by any of them
upon any of their indebtedness or obligations to the Agent as the
Agent in its sole discretion, may determine, whether or not such
indebtedness or obligations relate to the Guaranteed Obligations; and
(J) refund at any time, at the Agent's sole discretion, any
payment received by the Agent in respect of any Guaranteed
Obligations, and payment to the Agent of the amount so refunded shall
be fully guaranteed hereby even though prior thereto this Agreement
shall have been cancelled or surrendered (or any release or
termination of any collateral by virtue thereof) by the Agent, and
such prior cancellation or surrender shall not diminish, release,
discharge, impair or otherwise affect the obligations of any Borrower
hereunder in respect of the amount so refunded (and any collateral so
released or terminated shall be reinstated with respect to such
obligations);
even if any right of reimbursement or subrogation or other right or
remedy of any Borrower is extinguished, affected or impaired by any of the
foregoing (including, without limitation, any election of remedies by reason
of any judicial, non-judicial or other proceeding in respect of the Guaranteed
Obligations which impairs any subrogation, reimbursement or other right of
such Borrower).
The foregoing provisions are intended to eliminate suretyship
defenses and are not intended to affect the operation of Section 11.1.
(ii) Each Borrower hereby waives:
(A) any requirements of diligence or promptness on the part of
the Agent;
(B) presentment, demand for payment or performance and protest
and notice of protest with respect to the Guaranteed Obligations;
(C) notices (I) of nonperformance, (II) of acceptance of this
Agreement, (III) of default in respect of the Guaranteed Obligations,
(IV) of the existence, creation or incurrence of new or additional
indebtedness, arising either from additional loans extended to any
Borrower or otherwise, (V) that the principal amount, or any portion
thereof, and/or any interest on any instrument or document evidencing
all or any part of the Guaranteed Obligations is due, (VI) of any and
all proceedings to collect from any Borrower, any endorser or any
other guarantor of all or any part of the Guaranteed Obligations, or
from anyone else, and (VII) of exchange, sale, surrender or other
handling of any security or collateral given to the Agent to secure
payment of the Guaranteed Obligations or any guaranty therefor;
(D) any right to require the Agent to (I) proceed first against
any other Borrower, or any other person whatsoever, (II) proceed
against or exhaust any security given to or held by the Agent in
connection with the Guaranteed Obligations, or (III) pursue any other
remedy in the Agent's power whatsoever;
(E) any defense arising by reason of (I) any disability or other
defense of any Borrower, (II) the cessation from any cause whatsoever
of the liability of any Borrower, (III) any act or omission of the
Agent or others which directly or indirectly, by operation of law or
otherwise, results in or aids the discharge or release of any Borrower
or any security given to or held by the Agent in connection with the
Guaranteed Obligations;
(F) any and all other suretyship defenses under applicable law;
(G) the benefit of any statute of limitations affecting the
Guaranteed Obligations or such Borrower's liability hereunder or the
enforcement hereof.
(H) in connection with the foregoing, each Borrower covenants
that this Agreement shall not be discharged, except by complete
performance of the obligations contained herein.
(iii) Each Borrower hereby assumes responsibility for
keeping itself informed of the financial condition of each other Borrower, of
any and all endorsers and/or other guarantors of any instrument or document
evidencing all or any part of the Guaranteed Obligations and of all other
circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations
or any part thereof that diligent inquiry would reveal and each Borrower hereby
agrees that the Agent shall not have any duty to advise any Borrower of
information known to the Agent regarding such condition or any such
circumstances.
(iv) Each Borrower hereby agrees that any indebtedness of
any Borrower now or hereafter owing to such Borrower is hereby subordinated to
all of the Guaranteed Obligations, whether heretofore, now or hereafter created
(the "Subordinated Debt"), and that without the prior consent of the Agent, the
Subordinated Debt shall not be paid in whole or in part until the Guaranteed
Obligations have been paid in full, the commitments of the Lenders to extend
credit under the Credit Agreement have been terminated, no Letters of Credit
are outstanding and the Credit Agreement has been terminated and is of no
further force or effect, except that payments of principal and interest on the
Subordinated Debt shall be permitted so long as no Default or Event of Default
shall have occurred and be continuing to the extent such payments would not
render such Borrower incapable of performing the Guaranteed Obligations. No
Borrower will accept any payment of or on account of any Subordinated Debt at
any time in contravention of the foregoing. At the request of the Agent, each
Borrower shall pay to the Agent all or any part of the Subordinated Debt and
any amount so paid to the Agent shall be applied to payment of the Guaranteed
Obligations. Each payment on the Subordinated Debt received in violation of any
of the provisions hereof shall be deemed to have been received by the relevant
Borrower as trustee for the Agent and shall be paid over to the Agent
immediately on account of the Guaranteed Obligations, but without otherwise
affecting in any manner such Borrower's liability under any of the provisions
of this Agreement. Each Borrower agrees to file all claims against any other
Borrower in any bankruptcy or other proceeding in which the filing of claims is
required by law in respect of any Subordinated Debt, and the Agent shall be
entitled to all of such Borrower's right thereunder. If for any reason the
relevant Borrower fails to file such claim at least thirty (30) days prior to
the last date on which such claim should be filed, the Agent, as such
Borrower's attorney-in-fact, is hereby authorized to do so in such Borrower's
name or, in the Agent's discretion, to assign such claim to and cause proof of
claim to be filed in the name of the Agent or its nominee. In all such cases,
whether in administration, bankruptcy or otherwise, the person or persons
authorized to pay such claim shall pay to the Agent the full amount payable on
the claim in the proceeding, and, to the full extent necessary for that
purpose, each Borrower hereby assigns to the Agent all such Borrower's rights
to any payments or distributions to which such Borrower otherwise would be
entitled. If the amount so paid is greater than such Borrower's liability
hereunder, the Agent will pay the excess amount to the party entitled thereto.
In addition, each Borrower hereby appoints the Agent as its attorney-in-fact to
exercise all of such Borrower's voting rights in connection with any bankruptcy
proceeding or any plan for the reorganization of any other Borrower.
13.4 Guarantee Absolute and Unconditional. Each Borrower hereby
expressly agrees that this Article 13 is a continuing, unconditional guaranty
of payment and performance and not of collection and its obligations under this
Article 13 are joint and several, absolute and unconditional and shall not be
discharged or otherwise affected as a result of:
(i) the invalidity or unenforceability of any security
for or other guaranty of the Guaranteed Obligations or of any promissory note
or other document (including, without limitation, this Agreement) evidencing
all or any part of the Guaranteed Obligations, or the lack of perfection or
continuing perfection or failure of priority of any security for the Guaranteed
Obligations or any other guaranty therefor;
(ii) the absence of any attempt to collect the Guaranteed
Obligations from any other Borrower or any other guarantor or other action to
enforce the same;
(iii) failure by the Agent to take any steps to perfect
and maintain any security interest in, or to preserve any rights to, any
security or collateral for the Guaranteed Obligations or any other guaranty
therefor;
(iv) the Agent's election, in any proceeding instituted
under Chapter 11 of Title 11 of the United States Code (11 U.S.C. ss. 101 et
seq.) (the "Bankruptcy Code"), of the application of Section 1111(b)(2) of the
Bankruptcy Code;
(v) any borrowing or grant of a security interest by any
Borrower, as debtor-in-possession, or extension of credit, under Section 364 of
the Bankruptcy Code;
(vi) the disallowance, under Section 502 of the
Bankruptcy Code, of all or any portion of the Agent's claim(s) for repayment of
the Guaranteed Obligations;
(vii) any use of cash collateral under Section 363 of the
Bankruptcy Code;
(viii) any agreement or stipulation as to the provision
of adequate protection in any bankruptcy proceeding;
(ix) the avoidance of any lien in favor of the Agent for
any reason;
(x) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, liquidation or dissolution proceeding
commenced by or against any Borrower or any other guarantor, maker or endorser,
including without limitation, any discharge of, or bar or stay against
collecting, all or any of the Guaranteed Obligations (or any interest thereon)
in or as a result of any such proceeding;
(xi) failure by the Agent to file or enforce a claim
against any Borrower or its estate in any bankruptcy or insolvency case or
proceeding;
(xii) any action taken by the Agent that is authorized by
this Agreement;
(xiii) any election by the Agent under Section 9-501(4)
of the Uniform Commercial Code as enacted in any relevant jurisdiction as to
any security for the Guaranteed Obligations or any guaranty of the Guaranteed
Obligations; or
(xiv) any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a guarantor.
13.5 Reinstatement. Each Borrower further agrees that, if any payment
made by any Borrower or any other person and applied to the Guaranteed
Obligations is at any time annulled, set aside, rescinded, invalidated,
declared to be fraudulent or preferential or otherwise required to be refunded
or repaid, or the proceeds of any Collateral are required to be returned by the
Agent, any of the Lenders and any Issuing Bank to any Borrower, its estate,
trustee, receiver or any other party, including, without limitation, any
guarantor, under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or repayment, each
Borrower's liability hereunder (and any lien, security interest or other
collateral securing such liability) shall be and remain in full force and
effect, as fully as if such payment had never been made, or, if prior thereto
this Agreement shall have been cancelled or surrendered (and if any lien,
security interest or other collateral securing any Borrower's liability
hereunder shall have been released or terminated by virtue of such cancellation
or surrender), this Agreement (and such lien, security interest or other
collateral) shall be reinstated in full force and effect, and such prior
cancellation or surrender shall not diminish, release, discharge, impair or
otherwise affect the obligations of any Borrower in respect of the amount of
such payment (or any lien, security interest or other collateral securing such
obligation).
13.6 Payment. (i) Each Borrower agrees that if any other Borrower
shall default in payment or performance of any of the Guaranteed Obligations,
whether principal, interest, premium, fee (including, but not limited to, loan
fees and attorneys' fees and expenses), or otherwise, when and as the same
shall become due, and after expiration of any applicable grace period, whether
according to the terms of this Agreement, by acceleration, or otherwise, or
upon the occurrence and during the continuance of any Event of Default, then
such Borrower will, upon demand thereof by the Agent, fully pay to the Agent,
for the benefit of the Lenders and the Issuing Bank equal to all the Guaranteed
Obligations then due and owing.
(ii) Each Borrower further agrees to pay all costs and
expenses upon demand including, without limitation, all court costs and
reasonable attorneys' fees and expenses paid or incurred by the Agent (i) in
endeavoring to collect all or any part of the Guaranteed Obligations after the
same become due and owing from, or in prosecuting any action against, any
Borrower or any other guarantor of all or any part of the Guaranteed
Obligations or (ii) in endeavoring to realize upon (whether by judicial,
non-judicial or other proceedings) any Collateral or any other collateral
securing any Guarantor's liabilities under this Agreement.
ARTICLE 14
MISCELLANEOUS
14.1 No Waivers; Cumulative Remedies. No failure by the Agent or any
Lender to exercise any right, remedy, or option under this Agreement or any
present or future supplement thereto, or in any other agreement between or
among any Borrower and the Agent and/or any Lender, or delay by the Agent or
any Lender in exercising the same, will operate as a waiver thereof. No waiver
by the Agent or any Lender will be effective unless it is in writing, and then
only to the extent specifically stated. No waiver by the Agent or the Lenders
on any occasion shall affect or diminish the Agent's and each Lender's rights
thereafter to require strict performance by any Borrower of any provision of
this Agreement. The Agent and the Lenders may proceed directly to collect the
Obligations without any prior recourse to the Collateral. The Agent's and each
Lender's rights under this Agreement will be cumulative and not exclusive of
any other right or remedy which the Agent or any Lender may have.
14.2 Severability. The illegality or unenforceability of any provision
of this Agreement or any Loan Document or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or enforceability
of the remaining provisions of this Agreement or any instrument or agreement
required hereunder.
14.3 Governing Law; Choice of Forum; Service of Process.
(a) THIS AGREEMENT SHALL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK; PROVIDED THAT THE AGENT AND THE LENDERS SHALL
RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
IN THE CITY OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE BORROWERS,
THE AGENT AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE BORROWERS, THE
AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO.
NOTWITHSTANDING THE FOREGOING: (1) THE AGENT AND THE LENDERS SHALL HAVE THE
RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST ANY BORROWER OR ITS RESPECTIVE
PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION THE AGENT OR THE LENDERS DEEM
NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERAL OR OTHER SECURITY
FOR THE OBLIGATIONS AND (2) EACH OF THE PARTIES HERETO ACKNOWLEDGES THAT ANY
APPEALS FROM THE COURTS DESCRIBED IN THE IMMEDIATELY PRECEDING SENTENCE MAY HAVE
TO BE HEARD BY A COURT LOCATED OUTSIDE THOSE JURISDICTIONS.
(c) EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY
REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO SUCH BORROWER AT ITS
ADDRESS SET FORTH IN SECTION 14.8 AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE U.S.
MAILS POSTAGE PREPAID. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF AGENT
OR THE LENDERS TO SERVE LEGAL PROCESS BY ANY OTHER MANNER PERMITTED BY LAW.
14.4 WAIVER OF JURY TRIAL. EACH BORROWER, THE LENDERS AND THE AGENT
EACH IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT,
THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY,
IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE
PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR
ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE.
EACH BORROWER, THE LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT
TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
14.5 Survival of Representations and Warranties. All of each
Borrower's representations and warranties contained in this Agreement shall
survive the execution, delivery, and acceptance thereof by the parties,
notwithstanding any investigation by the Agent or the Lenders or their
respective agents.
14.6 Other Security and Guaranties. The Agent, may, without notice or
demand and without affecting any Borrower's obligations hereunder, from time to
time: (a) accept from any Person (other than Parent and its Subsidiaries) and
hold collateral (other than the Collateral) for the payment of all or any part
of the Obligations and exchange, enforce or release such collateral or any part
thereof; and (b) accept and hold any endorsement or guaranty of payment of all
or any part of the Obligations and release or substitute any such endorser or
guarantor, or any Person who has given any Lien in any other collateral as
security for the payment of all or any part of the Obligations, or any other
Person in any way obligated to pay all or any part of the Obligations.
14.7 Fees and Expenses. Each Borrower agrees to pay to the Agent, for
its benefit, on demand, all reasonable costs and expenses (other than any Taxes
or Other Taxes, which are governed by Section 4.1) that Agent pays or incurs in
connection with the negotiation, preparation, syndication, consummation,
administration, enforcement, and termination of this Agreement or any of the
other Loan Documents, including: (a) Attorney Costs; (b) reasonable costs and
expenses (including reasonable attorneys' and paralegals' fees and
disbursements) for any amendment, supplement, waiver, consent, or subsequent
closing in connection with the Loan Documents and the transactions contemplated
thereby; (c) costs and expenses of lien and title searches and title insurance;
(d) taxes, fees and other charges for recording the Mortgages, filing financing
statements and continuations, and other actions to perfect, protect, and
continue the Agent's Liens (including costs and expenses paid or incurred by
the Agent in connection with the consummation of Agreement); (e) sums paid or
incurred to pay any amount or take any action required of any Borrower under
the Loan Documents that such Borrower fails to pay or take; (f) subject to
Section 7.4, costs of appraisals, field exams, inspections, audits, and
verifications of the Collateral, including travel, lodging, and meals for
inspections of the Collateral and any Borrower's operations by the Agent plus
the Agent's then customary charge for field examinations and audits and the
preparation of reports thereof (such charge is currently $850 per day (or
portion thereof) for each Person that is an employee of the Agent with respect
to each field examination or audit); and (g) costs and expenses of forwarding
loan proceeds, collecting checks and other items of payment, and establishing
and maintaining Payment Accounts and lock boxes, and costs and expenses of
preserving and protecting the Collateral. In addition, each Borrower agrees to
pay costs and expenses incurred by the Agent (including Attorneys' Costs) to
the Agent, for its benefit, on demand, and to the other Lenders for their
benefit, on demand, and all reasonable fees, expenses and disbursements
incurred by such other Lenders for one law firm retained by such other Lenders,
in each case, paid or incurred to obtain payment of the Obligations, enforce
the Agent's Liens, sell or otherwise realize upon the Collateral, and otherwise
enforce the provisions of the Loan Documents, or to defend any claims made or
threatened against the Agent or any Lender arising out of the transactions
contemplated hereby (including preparations for and consultations concerning
any such matters). The foregoing shall not be construed to limit any other
provisions of the Loan Documents regarding costs and expenses to be paid by any
Borrower. All of the foregoing costs and expenses shall be charged to the
applicable Borrower's Loan Account as Revolving Loans as described in Section
3.7.
14.8 Notices. Except as otherwise provided herein, all notices,
demands and requests that any party is required or elects to give to any other
shall be in writing, or by a telecommunications device capable of creating a
written record, and any such notice shall become effective (a) upon personal
delivery thereof, including, but not limited to, delivery by overnight mail and
courier service, (b) four (4) days after it shall have been mailed by United
States mail, first class, certified or registered, with postage prepaid, or (c)
in the case of notice by such a telecommunications device, when properly
transmitted, in each case addressed to the party to be notified as follows:
If to the Agent or to the Bank:
Bank of America, N.A.
335 Madison Avenue
New York, New York 10017
Attention: Business Credit-Account Executive and Legal Department
Telephone: (212) 503-7623
Telecopy: (212) 503-7350
If to the Borrowers
AnnTaylor, Inc.
1372 Broadway
New York, New York 10018
Attention: Senior Vice President and General Counsel
Facsimile No.: (212) 536-4412
Telephone No.: (212) 536-4253
With copies to:
AnnTaylor, Inc.
414 Chapel Street
New Haven, CT 06511
Attention: Vice President and Controller
Facsimile No.: (203) 865-2756
Telephone No.: (203) 865-0811
and
AnnTaylor, Inc.
142 W. 57th Street
New York, NY 10019
Attention: Senior Vice President-Chief Financial Officer
or to such other address as each party may designate for itself by like
notice. Failure or delay in delivering copies of any notice, demand, request,
consent, approval, declaration or other communication to the persons
designated above to receive copies shall not adversely affect the
effectiveness of such notice, demand, request, consent, approval, declaration
or other communication. Each of ANNCO, AT Retail and AT Distribution hereby
appoint ATI as its agent for purposes of receiving and delivering all notices
pursuant hereto and under the other Loan Documents.
14.9 Waiver of Notices. Each Borrower waives presentment, and notice
of demand or dishonor and protest as to any instrument, notice of intent to
accelerate the Obligations and notice of acceleration of the Obligations, as
well as any and all other notices to which it might otherwise be entitled,
except, in each case, to the extent expressly provided for in the Loan
Documents. No notice to or demand on any Borrower which the Agent or any Lender
may elect to give shall entitle any Borrower to any or further notice or demand
in the same, similar or other circumstances.
14.10 Binding Effect. The provisions of this Agreement shall be
binding upon and inure to the benefit of the respective representatives,
successors, and assigns of the parties hereto; provided, however, that no
interest herein may be assigned by any Borrower without prior written consent
of the Agent and each Lender. Each Lender agrees to give prompt notice of any
such assignment to the Agent and ATI on behalf of the Borrowers. The rights and
benefits of the Agent and the Lenders hereunder shall, if such Persons so
agree, inure to any party acquiring any interest in the Obligations or any part
thereof.
14.11 Indemnity of the Agent and the Lenders by the Borrowers.
(a) Each Borrower agrees to defend, indemnify and hold the
Agent-Related Persons, and each Lender and each of its respective officers,
directors, employees, counsel, representatives, agents and attorneys-in-fact
(each, an "Indemnified Person") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, charges, expenses and disbursements (including Attorney Costs) of
any kind or nature whatsoever which may at any time (including at any time
following repayment of the Loans and the termination, resignation or
replacement of the Agent or replacement of any Lender) be imposed on, incurred
by or asserted against any such Person in any way relating to or arising out of
this Agreement or any document contemplated by or referred to herein, or the
transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with respect
to any investigation, litigation or proceeding (including any Insolvency
Proceeding or appellate proceeding) related to or arising out of this
Agreement, any other Loan Document, or the Loans or the use of the proceeds
thereof, whether or not any Indemnified Person is a party thereto (all the
foregoing, collectively, the "Indemnified Liabilities"); provided, that the
Borrowers shall have no obligation hereunder to any Indemnified Person with
respect to Indemnified Liabilities to the extent, as to any Indemnified Person,
it shall be determined in a final, nonappealable judgment by a court of
competent jurisdiction that such losses, claims, damages, liabilities or
expenses resulted from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
(b) Each Borrower agrees to indemnify, defend and hold harmless
each Indemnified Person from any loss or liability directly or indirectly
arising out of the use, generation, manufacture, production, storage, release,
threatened release, discharge, disposal or presence of a hazardous substance
relating to any Borrower's operations, business or property. This indemnity
will apply whether the hazardous substance is on, under or about such
Borrower's property or operations or property leased to such Borrower. The
indemnity includes but is not limited to Attorneys Costs. "Hazardous
substances" means any substance, material or waste that is or becomes
designated or regulated as "toxic," "hazardous," "pollutant," or "contaminant"
or a similar designation or regulation under any federal, state or local law
(whether under common law, statute, regulation or otherwise) or judicial or
administrative interpretation of such, including petroleum or natural gas. This
indemnity will survive repayment of all other Obligations.
14.12 Limitation of Liability. NO CLAIM MAY BE MADE BY ANY PARTY
HERETO AGAINST ANY OTHER PARTY HERETO OR THE AFFILIATES, DIRECTORS, OFFICERS,
EMPLOYEES, COUNSEL, REPRESENTATIVES, AGENTS OR ATTORNEYS-IN-FACT OF ANY SUCH
PARTY FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT
OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING
OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION
THEREWITH, AND EACH PARTY HERETO HEREBY WAIVES, RELEASES AND AGREES NOT TO SUE
UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT
KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.
14.13 Final Agreement. This Agreement and the other Loan Documents are
intended by the Borrowers, the Agent and the Lenders to be the final, complete,
and exclusive expression of the agreement between them. This Agreement
supersedes any and all prior oral or written agreements relating to the subject
matter hereof except for the Fee Letter. No modification, rescission, waiver,
release, or amendment of any provision of this Agreement or any other Loan
Document shall be made, except by a written agreement signed by the Borrowers
and a duly authorized officer of each of the Agent and the requisite Lenders.
14.14 Counterparts. This Agreement may be executed in any number of
counterparts, and by the Agent, each Lender and each Borrower in separate
counterparts, each of which shall be an original, but all of which shall
together constitute one and the same agreement; signature pages may be detached
from multiple separate counterparts and attached to a single counterpart so
that all signature pages are physically attached to the same document.
14.15 Captions. The captions contained in this Agreement are for
convenience of reference only, are without substantive meaning and should not
be construed to modify, enlarge, or restrict any provision.
14.16 Right of Setoff. In addition to any rights and remedies of the
Lenders provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Borrowers, any such notice being waived by the
Borrowers 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 by, and other indebtedness at any time owing by, such Lender or any
Affiliate of such Lender to or for the credit or the account of any Borrower
against any and all Obligations owing to such Lender, now or hereafter
existing, irrespective of whether or not the Agent or such Lender shall have
made demand under this Agreement or any Loan Document and although such
Obligations may be contingent or unmatured. Each Lender agrees promptly to
notify the Borrowers (or ATI on behalf of the Borrowers) and the Agent after
any such set-off and application made by such Lender; provided, however, that
the failure to give such notice shall not affect the validity of such set-off
and application. NOTWITHSTANDING THE FOREGOING, NO LENDER SHALL EXERCISE ANY
RIGHT OF SET-OFF, BANKER'S LIEN, OR THE LIKE AGAINST ANY DEPOSIT ACCOUNT OR
PROPERTY OF ANY BORROWER HELD OR MAINTAINED BY SUCH LENDER WITHOUT THE PRIOR
WRITTEN CONSENT OF THE AGENT AND THE REQUIRED LENDERS.
14.17 Confidentiality.
(a) Each Borrower hereby consents that the Agent and each Lender
may issue and disseminate to the public general information describing the
credit accommodation entered into pursuant to this Agreement, including the
name and address of any Borrower and any other Subsidiary and a general
description of any Borrower's and its respective Subsidiaries' business and may
use any Borrower's and any Subsidiary's name in advertising and other
promotional material.
(b) Each Lender and the Agent severally agrees to take normal
and reasonable precautions and exercise due care to maintain the
confidentiality of all information identified as "confidential" or "secret" by
any Borrower and provided to the Agent or such Lender by or on behalf of such
Borrower, under this Agreement or any other Loan Document (including any Report
provided by the Agent to any Lender), except to the extent that such
information (i) was or becomes generally available to the public other than as
a result of disclosure by the Agent or such Lender, or (ii) was or becomes
available on a nonconfidential basis from a source other than any Borrower,
provided that such source is not bound by a confidentiality agreement with any
Borrower or an Affiliate thereof known to the Agent or such Lender; provided,
however, that the Agent and any Lender may disclose such information (1) at the
request or pursuant to any requirement of any Governmental Authority to which
the Agent or such Lender is subject or in connection with an examination of the
Agent or such Lender by any such Governmental Authority; (2) pursuant to
subpoena or other court process; (3) when required to do so in accordance with
the provisions of any applicable Requirement of Law; (4) to the extent
reasonably required in connection with any litigation or proceeding (including,
but not limited to, any bankruptcy proceeding) to which the Agent, any Lender
or their respective Affiliates may be party; (5) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document; (6) to the Agent's or such Lender's independent auditors,
accountants, attorneys and other professional advisors; (7) to any prospective
Participant or Assignee under any Assignment and Acceptance, actual or
potential, provided that such prospective Participant or Assignee agrees to
keep such information confidential to the same extent required of the Agent and
the Lenders hereunder; (8) as expressly permitted under the terms of any other
document or agreement regarding confidentiality to which any Borrower is party
or is deemed party with the Agent or such Lender, and (9) to its Affiliates.
Notwithstanding anything herein to the contrary, the information subject to
this Section 14.17(b) shall not include, and the Borrowers, Agent and each
Lender and the respective Affiliates of each of the foregoing (and the
respective partners, directors, officers, employees, agents, advisors and
other representatives of each of the foregoing and their Affiliates) may
disclose to any and all Persons, without limitation of any kind, (a) any
information with respect to the U.S. federal and state income tax treatment of
the transactions contemplated hereby and any facts that may be relevant to
understanding such tax treatment, which facts shall not include for this
purpose the names of the parties or such other Persons, or any pricing terms
or other nonpublic business or financial information that is unrelated to such
tax treatment or facts and (b) all materials of any kind (including opinions
or other tax analyses) that are provided to the Agent or such Lender relating
to such tax treatment or facts.
14.18 Conflicts with Other Loan Documents. Unless otherwise
expressly provided in this Agreement (or in another Loan Document by specific
reference to the applicable provision contained in this Agreement), if any
provision contained in this Agreement conflicts with any provision of any other
Loan Document, the provision contained in this Agreement shall govern and
control.
14.19 No Lender Reliance on Margin Stock. Each Lender
acknowledges and represents that it, in good faith, has not relied upon Margin
Stock of the Parent or any of its Subsidiaries as collateral in its decision to
make any Credit Extensions to the Borrowers.
ARTICLE 15
AMENDMENT AND RESTATEMENT
15.1 Amendment and Restatement. Each Borrower, the Agent, the
Issuing Banks and the Lenders hereby agree that upon the effectiveness of this
Agreement, the terms and provisions of the Original Credit Agreement which in
any manner govern or evidence the Obligations, the rights and interests of the
Lenders and any terms, conditions or matters related to any thereof, shall be
and hereby are amended and restated in their entirety by the terms and
provisions of this Agreement and the terms and conditions of the Original
Credit Agreement shall be superseded by this Agreement, except as expressly
provided herein.
Notwithstanding the amendment and restatement of Original Credit
Agreement and certain of the related "Loan Documents" as defined in the
Original Credit Agreement (the "Prior Loan Documents") by this Agreement and
the other Loan Documents as herein defined, all of the indebtedness,
liabilities and obligations owing by any Borrower under the Original Credit
Agreement shall continue as Obligations hereunder and shall be and remain
secured by the Security Instruments for the benefit of the Agent and the
Lenders. This Agreement is given as a substitution of, and not as a payment of,
the indebtedness, liabilities and obligations of the Borrowers, under the
Original Credit Agreement and is not intended to constitute a novation thereof
or of any of the other Prior Loan Documents. Upon the effectiveness of this
Agreement, all Loans owing by the Borrowers and Letters of Credit outstanding
under the Original Credit Agreement shall continue as Loans and Letters of
Credit hereunder, in each case accruing interest, as of the date hereof, at the
Base Rate hereunder.
15.2 Assignment and Acceptance. Each Borrower, the Agent, the
Letter of Credit Issuers and the Lenders hereby acknowledge the assignment by
the lenders party to the Original Credit Agreement to the Lenders party hereto
of all Loans and Commitments under the Original Credit Agreement in the amounts
and allocations as reflected on Schedule 1.1 substantially simultaneously with
the effectiveness of this Agreement and such assignment shall be deemed to have
been consummated in accordance with Section 12.01 of the Original Credit
Agreement and the terms, conditions, representations and warranties set forth
in the form of Assignment and Acceptance set forth as Exhibit 12.01 of the
Original Credit Agreement shall be deemed to have been made and agreed to as
between the lenders party to the Original Credit Agreement and Lender party
hereto as if an Assignment and Acceptance had been fully executed and delivered
by such parties.
IN WITNESS WHEREOF, the parties have entered into this Agreement
on the date first above written.
BORROWERS:
----------
ANNTAYLOR, INC.
By: /s/ James M. Smith
---------------------------
Name: James M. Smith
Title: Senior Vice President,
Chief Financial Officer
and Treasurer
ANNCO, INC.
By: /s/ James M. Smith
----------------------------
Name: James M. Smith
Title: Chief Financial Officer
ANNTAYLOR DISTRIBUTION SERVICES,
INC.
By: /s/ James M. Smith
-----------------------------
Name: James M. Smith
Title: Senior Vice President
and Treasurer
ANNTAYLOR RETAIL, INC.
By: /s/ James M. Smith
-----------------------------
Name: James M. Smith
Title: Senior Vice President
and Treasurer
ADMINSTRATIVE AGENT AND
-----------------------
COLLATERAL AGENT:
----------------
BANK OF AMERICA, N.A., as the Agent
By: /s/ Jang S. Kim
------------------------------
Name: Jang S. Kim
Title: Vice President
LENDERS:
-------
BANK OF AMERICA, N.A., as a Lender
By: /s/ Jang S. Kim
------------------------------
Name: Jang S. Kim
Title: Vice President
Address for Notices:
Bank of America, N.A.
335 Madison Avenue
New York, New York 10017
Attention: Business Credit-
Account Executive
Telephone No.: (212) 503-7637
Facsimile No.: (212) 503-7340
Payment Instructions:
Payment Instructions:
Bank of America, N.A.
1850 Gateway Boulevard
Concord, CA 94520
ABA No.: 121-000-358
Account Name: Bank of America
Business Credit
Account No.: 1235303848
Reference: AnnTaylor, Inc.
Address for Letter of Credit
Fee Payment:
Bank of America, N.A.
1850 Gateway Boulevard
Concord, CA 94520
ABA No.: 121-000-358
Account Name: Bank of America
Business Credit
Account No.: 1235303848
Reference: AnnTaylor, Inc.
JPMORGAN CHASE BANK, as a
Syndication Agent and as a Lender
By: /s/ Meredith Vanden Handel
------------------------------
Name: Meredith Vanden Handel
Title: Vice President
Address for Notices:
________________________________
JPMORGAN CHASE BANK
1411 Broadway, 5th Floor
New York, New York 10018
Attention: Craig G. Transue
Telephone No.: (212) 391-2208
Facsimile No.: (212) 391-2102
Payment Instructions:
_______________________________
JPMORGAN CHASE BANK
4 Metrotech Center
Brooklyn, New York 11245
ABA No.: 021000021
Account Name: Commercial Loan #9420
Account No.: _________________
Reference: AnnTaylor, Inc.
Address for Letter of Credit Fee
Payment:
________________________________
ABA No.: 021000021
Standby L/C Department
10420 Highland Manor Drive
4th Floor
Tampa, Florida 33610
For Credit No.: 324331754
Reference: AnnTaylor, Inc.
WACHOVIA BANK, NATIONAL
ASSOCIATION, as a
Syndication Agent and as a Lender
By: /s/ Todd Tucker
-----------------------------
Name: Todd Tucker
Title: Senior Vice President
Address for Notices:
Wachovia Bank, National Association
201 South College Street
Charlotte, North Carolina 28288
Attention: Todd Tucker
Telephone No.: (704) 383-0905
Facsimile No.: (704) 715-0097
Payment Instructions:
Wachovia Bank, National Association
Charlotte, North Carolina
ABA No.: 053000219
Account Name: Retail
Account No.: 01459168114011
Attention: Todd Tucker
Reference: AnnTaylor, Inc.
FLEET RETAIL GROUP, as a
Documentation Agent and as a Lender
By: /s/ Kathleen Dimock
-----------------------------
Name: Kathleen Dimock
Title: Managing Director
Address for notices:
Fleet Retail Group
40 Broad Street, 10th Floor
Boston, Massachusetts 02109
Attention: Kathleen Dimock
Telephone No.: (617) 434-3830
Facsimile No.: (617) 434-6685
Payment Instructions:
Fleet Retail Group
Boston, Massachusetts
ABA No.: 011-000-138
Account No.: 53039952
Reference: AnnTaylor, Inc.
THE CIT GROUP/BUSINESS CREDIT,
INC., as a Documentation Agent
and as a Lender
By: /s/ Christopher J. Esposito
------------------------------
Name: Christopher J. Esposito
Title: Vice President
Address for Notices:
The CIT Group/Business Credit, Inc.
1211 Avenue of the Americas
New York, New York 10036
Attention: Julianne Low
Telephone No.: (212) 790-9105
Facsimile No.: (212) 536-1295
Payment Instructions:
Chase Manhattan Bank, New York
New York, New York
ABA No.: 021000021
Account Name: The CIT Group/
Business Credit, Inc.
Account No.: 144-0-64425
Reference: AnnTaylor, Inc.
LASALLE RETAIL FINANCE, a division of
LASALLE BUSINESS CREDIT, LLC, as
agent for STANDARD FEDERAL BANK
NATIONAL ASSOCIATION, as a Lender
By: /s/ Barbara Anderson
---------------------------------
Name: Barbara Anderson
Title: Senior Vice President
Address for Notices:
LaSalle Bank, N.A.
25 Braintree Hill Office Park
Braintree, MA 02184
Attention: Dan Durkin
Telephone No.: (718) 353-6120
Facsimile No.: (718) 353-6101
Payment Instructions:
LaSalle Bank, N.A.
1355 LaSalle Street
Chicago, IL 60603
ABA No.: 071000505
Account No.: 580033352
Attention: LaSalle Business Credit, LLC
Contact: Amie Kolo
Reference: AnnTaylor, Inc.
CITIZEN'S BANK, as a Lender
By: /s/ Stephen F. Foley
-----------------------------
Name: Stephen F. Foley
Title: Senior Vice President
Address for Notices:
Citizen's Bank
28 State Street
Boston, MA 02109
Telephone No.: (617) 994-7029
Facsimile No.: (617) 263-0439
Payment Instructions:
ABA No.: 011500120
Account No.: 1101011901
Attention: Maria Chaplain
Reference: AnnTaylor, Inc.
BANK LEUMI USA, as a Lender
By: /s/ John Koenigsberg
------------------------------
Name: John Koenigsberg
Title: First Vice President
By: /s/ Phyllis Rosenfeld
------------------------------
Name: Phyllis Rosenfeld
Title: Vice President
Address for Notices:
Bank Leumi USA
562 Fifth Avenue
New York, New York 10036
Attention: Phyllis Rosenfeld
Telephone No.: (212) 626-1322
Facsimile No.: (212) 626-1311
Payment Instructions:
Bank Leumi USA
New York, New York
ABA No.: 026002794
Account No.: 0190148600
Attention: Loan Operations
Reference: AnnTaylor, Inc.
FIFTH THIRD BANK, as a Lender
By: /s/ Ann Pierson
-----------------------------
Name: Ann Pierson
Title: Corporate Banking Officer
Address for Notices:
Fifth Third Bank
38 Fountain Square
Cincinnati, Ohio 45263
Attention: Ann Person, Corporate
Banking Officer
Telephone No.: (513) 579-5295
Facsimile No.: (513) 744-5947
Payment Instructions:
Fifth Third Bank of America
Cincinnati, Ohio
ABA No.: 042000314
Account No.: 72876175
Attention: Jennifer Pund
Reference: AnnTaylor, Inc.
ANNEX A
to
Credit Agreement
1. Definitions.
Capitalized terms used in the Loan Documents shall have the
following respective meanings (unless otherwise defined therein), and all
section references in the following definitions shall refer to sections of the
Agreement:
"Accommodation Obligation" as applied to any Person, shall mean
any contractual obligation, contingent or otherwise, of that Person with
respect to any Debt or other obligation or liability of another, including any
such Debt, obligation or liability directly or indirectly guaranteed, endorsed
(otherwise than for collection or deposit in the ordinary course of business),
co-made or discounted or sold with recourse by that Person, or in respect of
which that Person is otherwise directly or indirectly liable, including
Contractual Obligations (contingent or otherwise) arising through any agreement
to purchase, repurchase, or otherwise acquire such Debt, obligation or
liability or any security therefor, or to provide funds for the payment or
discharge thereof (whether in the form of loans, advances, stock purchases,
capital contributions or otherwise), or to maintain solvency, assets, level of
income, or other financial condition, or to make payment other than for value
received.
"Accounts" means all of any Borrower's now owned or hereafter
acquired or arising Credit Card Accounts and all other accounts, as defined in
the UCC, including any rights to payment for the sale or lease of goods or
rendition of services, whether or not they have been earned by performance.
"Account Debtor" means each Person obligated in any way on or in
connection with an Account.
"ACH Transactions" means any cash management or related services
including the automatic clearing house transfer of funds by any Lender which is
a bank for the account of any Credit Party pursuant to agreement or overdrafts.
"Acquisition" means the acquisition of (i) a controlling equity
interest in another Person (including the purchase of an option, warrant or
convertible or similar type security to acquire such a controlling interest at
the time it becomes exercisable by the holder thereof), whether by purchase of
such equity interest or upon exercise of an option or warrant for, or
conversion of securities into, such equity interest, or (ii) assets of another
Person which constitute all or substantially all of the assets of such Person
or of a line or lines of business conducted by such Person.
"Adjusted Availability" means at any time (a) the Borrowing
Base, minus (b) Reserves other than Reserves deducted in the calculation of the
Borrowing Base, minus (c) in each case, Aggregate Outstandings.
"Adjusted Net Earnings from Operations" means, with respect to
any fiscal period on a consolidated basis, the Parent's and each Borrower's net
income after provision for income taxes for such fiscal period, as determined
in accordance with GAAP and reported on the Financial Statements for such
period, excluding any and all of the following included in such net income: (a)
gain or loss arising from the sale of any capital assets; (b) gain arising from
any write-up in the book value of any asset; (c) earnings of any Person other
than a Subsidiary in which any Borrower has an ownership interest unless (and
only to the extent) such earnings shall actually have been received by such
Borrower in the form of cash distributions; (d) earnings of any Person to which
assets of any Borrower shall have been sold, transferred or disposed of, or
into which any Borrower shall have been merged, or which has been a party with
any Borrower to any consolidation or other form of reorganization, prior to the
date of such transaction; (e) gain or loss arising from the acquisition of debt
or equity securities of the Parent and the Borrowers or from cancellation or
forgiveness of Debt; and (f) gain or loss arising from extraordinary items, as
determined in accordance with GAAP or from any other non-recurring transaction.
"Affected Payee" has the meaning given to such term in Section
3.9.
"Affiliate" as applied to any Person, shall mean any other
Person directly or indirectly controlling, controlled by, or under common
control with, that Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to vote 10% or more of the
Securities having voting power for the election of directors of such Person or
otherwise to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting Securities or by contract
or otherwise; provided that no financial institution, mutual fund or investment
banking firm shall be an Affiliate of any Borrower unless it owns, directly or
indirectly, at least 20% of such Securities of such Borrower.
"Agent Advances" has the meaning specified in Section 1.2(i).
"Agent's Liens" means the Liens in the Collateral granted to the
Agent, for the benefit of the Lenders, Bank, and Agent pursuant to this
Agreement and the other Loan Documents.
"Agent-Related Persons" means the Agent, together with its
Affiliates, and the officers, directors, employees, counsel, representatives,
agents and attorneys-in-fact of the Agent and such Affiliates.
"Aggregate Outstandings" means, at any date of determination:
the sum of (a) the unpaid balance of Revolving Loans, (b) the aggregate amount
of Pending Revolving Loans, and (c) all Letter of Credit Outstandings.
"Agreement" means the Credit Agreement to which this Annex A is
attached, as from time to time amended, modified or restated.
"Applicable Margin" means, initially,
(i) with respect to Base Rate Loans, .000%;
(ii) with respect to LIBOR Loans and Standby Letter of Credit
Fees, 1.75%;
(iii) with respect to the Unused Line Fee, .375%; and
(iv) with respect to the Commercial Letter of Credit Fees,
..750%.
The Applicable Margins shall be adjusted (up or down)
prospectively on a quarterly basis as determined by the Average Daily
Availability for the three-month period most recently ended, commencing May 14,
2004 (the "Initial Adjustment Date"). Adjustments in Applicable Margins shall
be determined by reference to the following grids:
- ------------------------------- -------------------------------
If Average Daily Level of
Availability is: Applicable Margins:
- ------------------------------- -------------------------------
Greater than or equal to Level I
$100,000,000
- ------------------------------- -------------------------------
Greater than or equal to Level II
$65,000,000 but less than
$100,000,000
- ------------------------------- -------------------------------
Greater than or equal to Level III
$30,000,000 but less than
$65,000,000
- ------------------------------- -------------------------------
Less than $30,000,000 Level IV
- ------------------------------- -------------------------------
Low to High
- --------------------------- --------------------------------------------------
Applicable Margins
- --------------------------- ----------- ---------- ------------- -------------
Level I Level II Level III Level IV
- --------------------------- ----------- ---------- ------------- -------------
Base Rate Loans .000% .000% .000% .250%
- --------------------------- ----------- ---------- ------------- -------------
LIBOR Loans and Standby 1.25% 1.50% 1.75% 2.00%
Letter of Credit Fee
- --------------------------- ----------- ---------- ------------- -------------
Unused Line Fee .325% .350% .375% .400%
- --------------------------- ----------- ---------- ------------- -------------
Commercial Letter of .500% .625% .750% .750%
Credit Fee
- --------------------------- ----------- ---------- ------------- -------------
All adjustments in the Applicable Margins after the Initial
Adjustment Date shall be implemented quarterly on a prospective basis, on the
first day of each fiscal quarter of ATI (each an "Adjustment Date") based on
the Average Daily Availability for the immediately preceding fiscal quarter.
ATI shall deliver to the Agent and the Lenders on each Adjustment Date a
certificate, signed by a Responsible Officer, setting forth in reasonable
detail the basis for the continuance of, or any change in, the Applicable
Margins. If a Default or Event of Default has occurred and is continuing at the
time any reduction in the Applicable Margins is to be implemented, no reduction
may occur until the first day of the first calendar month following the date on
which such Default or Event of Default is waived or cured.
"Applicable Value" means (a) with respect to Eligible Inventory
(other than In-Transit Inventory) at any time, the lower of (i) average cost of
such Eligible Inventory at such time (calculated in accordance with GAAP) or
(ii) market value of such Eligible Inventory at such time, (b) with respect to
In-Transit Inventory at any time, the sum of (i) the aggregate undrawn face
amount of Commercial Letters of Credit issued to finance the purchase of
In-Transit Inventory and (ii) the aggregate cost of In-Transit Inventory that
has been financed with Commercial Letters of Credit which have been fully drawn
and the Reimbursement Obligations in respect of which have been fully paid at
such time (calculated in accordance with GAAP).
"Appraisal Date" means each of (a) the date of the appraisal
conducted prior to the Effective Date, (b) any date upon which the Agent
receives results of an appraisal conducted by an Eligible Appraiser at the
Agent's request in accordance with Section 7.4 and (c) any other date on which
results are received by the Agent of an appraisal conducted by an Eligible
Appraiser at any Borrower's request or, if an Event of Default exists, the
Agent's request.
"Appraised Value" means (a) with respect to all personal
property other than Inventory, the orderly liquidation value, net of expenses,
of such personal property, (b) with respect to Eligible Inventory, the
Applicable Value of such Eligible Inventory multiplied by the Liquidation
Percentage and (c) with respect to all Real Estate, the fair market value of
such Real Estate, in each case as established on the most recently occurring
Appraisal Date by an appraisal conducted by an Eligible Appraiser.
"Approved Deposit Account" means each Deposit Account (a) that
is maintained within the United States with a commercial bank organized under
the laws of the United States of America or any state thereof or the District
of Columbia having combined capital and surplus in excess of $500,000,000 and
otherwise acceptable to the Agent, and (b) as to which the deposits therein are
not subject to any Lien, security interest or restriction upon withdrawal,
other than the Agent's Liens and rights of setoff, Liens or adjustment of the
applicable depositary bank.
"Assignee" has the meaning specified in Section 11.2(a).
"Assignment and Acceptance" has the meaning specified in Section
11.2(a).
"AT Sourcing" means AnnTalyor Sourcing Far East Limited, a Hong
Kong corporation.
"AT Sourcing Obligation" means the accrued obligations of ATI to
AT Sourcing for sourcing services rendered in the ordinary course of business
to ATI; provided such obligations shall not be evidenced by a promissory note
or other negotiable instrument that has not been delivered to the Agent and
duly endorsed in blank, and total Debt of AT Sourcing other than Debt for
borrowed money owed to a wholly-owned Subsidiary of the Parent shall not exceed
$500,000.
"ATI" means AnnTaylor, Inc., a Delaware corporation.
"Attorney Costs" means and includes all reasonable fees,
expenses and disbursements of any law firm or other counsel engaged by any
Person, the reasonably allocated costs and expenses of internal legal services
of any Person.
"Availability" means at any time (a) the lesser of (i) the Total
Facility Amount and (ii) the Borrowing Base, minus (b) Reserves other than
Reserves deducted in the calculation of the Borrowing Base, minus (c) in each
case, Aggregate Outstandings.
"Average Daily Availability" means average daily Availability
for the most recently ended fiscal quarter (or three month period for the
Initial Determination Date only).
"Bank" means Bank of America, N.A., a national banking
association, or any successor entity thereto.
"Bank Products" means any one or more of the following types of
services or facilities extended to the Parent or any Borrower by any Lender,
including the Bank and any Affiliate of the Bank in reliance on the Bank's
agreement to indemnify such affiliate: (i) credit cards; (ii) ACH Transactions;
(iii) cash management, including controlled disbursement services; and (iv)
Hedge Agreements.
"Bank Product Reserves" means all reserves which the Agent from
time to time establishes in its reasonable discretion for the Bank Products
then provided or outstanding.
"Bankruptcy Code" means Title 11 of the United States Code (11
U.S.C.ss.101 et seq.), as amended.
"Base Rate" means, for any day, the rate of interest in effect
for such day as publicly announced from time to time by the Bank in Charlotte,
North Carolina as its "prime rate" (the "prime rate" being a rate set by the
Bank based upon various factors including the Bank's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate). Any change in the prime rate announced by the Bank shall take effect at
the opening of business on the day specified in the public announcement of such
change. Each Interest Rate based upon the Base Rate shall be adjusted
simultaneously with any change in the Base Rate.
"Base Rate Loans" means a Revolving Loan during any period in
which it bears interest based on the Base Rate.
"Benefit Plan" shall mean a defined benefit plan as defined in
Section 3(35) of ERISA (other than a Multi-employer Plan) which the ATI or an
ERISA Affiliate maintains, administers, contributes to or is required to
contribute to, or under which ATI or any ERISA Affiliate may incur any
liability.
"Blocked Account Agreement" means the Account Control Agreement
dated as of the Effective Date among ATI, the Agent and the Clearing Bank, in
form and substance reasonably satisfactory to the Agent, concerning the
collection of payments which represent the proceeds of Accounts or of any other
Collateral, as from time to time amended, supplemented or replaced.
"Borrowing" means a borrowing hereunder consisting of Revolving
Loans made on the same day by the Lenders to a Borrower or by Bank in the case
of a Borrowing funded by Non-Ratable Loans or by the Agent in the case of a
Borrowing consisting of an Agent Advance, or the issuance of Letters of Credit
hereunder.
"Borrowing Base" at any time, means an amount equal to:
(a) the sum of
(i) eighty-five percent (85%) of the Net Amount of
Eligible Accounts plus
(ii) the lesser of (A) eighty percent (80%) of the
Applicable Value of Eligible Inventory (other than
In-Transit Inventory) or (B) eighty-five percent (85%) of
the Appraised Value of Eligible Inventory (other than
In-Transit Inventory) plus
(iii) the lesser of (A) sixty percent (60%) of the
Applicable Value of In-Transit Inventory or (B)
seventy-five percent (75%) of the Appraised Value of
In-Transit Inventory plus
(iv) the lesser of (A) $15,000,000 or (B) fifty
percent (50%) of the Appraised Value of all Eligible
Fixed Assets; minus
(b) Reserves from time to time established by the Agent in its
reasonable credit judgment.
Notwithstanding the foregoing, for purposes of this definition, no Accounts or
Inventory or Fixed Assets being acquired in an Acquisition or otherwise
created, purchased, completed or owned by a business unit acquired pursuant to
an Acquisition will be included in the Borrowing Base unless (i) the Agent, in
its reasonable commercial discretion exercised in good faith, confirm that
such Accounts or Inventory or Fixed Assets conform to standards of eligibility
as fixed and revised from time to time by the Agent pursuant to this
Agreement, and (ii) to the extent deemed necessary by the Agent, an audit of
such Accounts and an appraisal of such Inventory and Fixed Assets is conducted
(which appraisal shall be by an appraiser acceptable to the Agent, at the
expense of the Borrowers and in form, scope and substance acceptable to the
Agent in its sole discretion) and then only so long as such Accounts or
Inventory or Fixed Assets, as the case may be, would otherwise satisfy the
applicable eligibility criteria.
"Borrowing Base Certificate" means a certificate by a
Responsible Officer of ATI, substantially in the form of Exhibit B (or another
form acceptable to the Agent) setting forth the calculation of the Borrowing
Base, including a calculation of each component thereof, all in such detail as
shall be reasonably satisfactory to the Agent. All calculations of the
Borrowing Base in connection with the preparation of any Borrowing Base
Certificate shall originally be made by ATI and certified to the Agent;
provided, that the Agent shall have the right to review and adjust, in the
exercise of its reasonable credit judgment, any such calculation (1) to reflect
its reasonable estimate of declines in value of any of the Collateral described
therein that are reflected in an appraisal or audit of such Collateral, and (2)
to the extent that such calculation is not in accordance with this Agreement.
"Business Day" means (a) any day that is not a Saturday, Sunday,
or a day on which banks in New York, New York or Charlotte, North Carolina are
required or permitted to be closed, and (b) with respect to all notices,
determinations, fundings and payments in connection with the LIBOR Rate or
LIBOR Loans, any day that is a Business Day pursuant to clause (a) above and
that is also a day on which trading in Dollars is carried on by and between
banks in the London interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any other
law, rule or regulation, whether or not having the force of law, in each case,
regarding capital adequacy of any bank or of any corporation controlling a
bank.
"Capital Expenditures" means all expenditures of any Credit
Party due (whether or not paid during any fiscal period) during any period in
respect of the cost of any fixed asset which in accordance with GAAP would be
reflected as a fixed asset on the balance sheet of such Credit Party,
including, without limitation, those costs arising in connection with the
direct or indirect acquisition of such asset by way of increased product or
service charges or in connection with a Capital Lease.
"Capital Lease" means any lease of property by any Credit Party
which, in accordance with GAAP, should be reflected as a capital lease on the
balance sheet of such Credit Party.
"Cash Equivalents" shall mean (a) marketable direct obligations
issued or unconditionally guaranteed by the United States Government or issued
by an agency thereof and backed by the full faith and credit of the United
States of America or having a rating of at least A-1 or P-1 from either S&P or
Moody's, in each case maturing within 360 days after the date of acquisition
thereof; (b) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof maturing within 180 days (or, if no Loans are
outstanding at the time of acquisition thereof and after giving effect thereto,
360 days) after the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either S&P
or Moody's (or, if at any time neither S&P nor Moody's shall be rating such
obligations, then from such other nationally recognized rating services
acceptable to the Requisite Lenders) and not listed in Credit Watch published
by S&P; (c) commercial paper, other than commercial paper issued by any
Borrower or any Subsidiary of any Borrower or any of their Affiliates, maturing
no more than 180 days (or, if no Loans are outstanding at the time of
acquisition thereof and after giving effect thereto, 270 days) after the date
of creation thereof and, at the time of acquisition thereof, having a rating of
at least A-1 or P-1 from either S&P or Moody's (or, if at any time neither S&P
nor Moody's shall be rating such obligations, then the highest rating from
other nationally recognized rating services acceptable to the Required
Lenders); (d) domestic and Eurodollar certificates of deposit or time deposits
or bankers' acceptances maturing within 180 days (or, if no Loans are
outstanding at the time of acquisition thereof and after giving effect thereto,
360 days) after the date of acquisition thereof issued by any commercial bank
organized under the laws of the United States of America or any state thereof
or the District of Columbia having combined capital and surplus of not less
than $500,000,000; (e) repurchase agreements with parties reasonably acceptable
to the Agent with a term of not more than 30 days for securities described in
clauses (a) through (d) of this definition; (f) shares of money market mutual
or similar funds which invest substantially all their assets in assets
satisfying the requirements of clauses (a) through (d) of this definition; and
(g) auction rate preferred instruments maturing no later than 35 days from the
date of purchase.
"Change in Control" shall be deemed to have occurred at such
time as either of the following events shall occur:
(a) There shall be consummated any consolidation or merger
of the Parent or any Borrower pursuant to which the Common Stock
would be converted into cash, or other property, in each case, other
than a consolidation or merger of the Parent or any Borrower in which
the holders of Common Stock immediately prior to the consolidation or
merger have, directly or indirectly, at least a majority of the total
voting power in the aggregate of all classes of common stock of the
continuing or surviving corporation normally entitled to vote in
elections of directors immediately after such consolidation or
merger; or
(b) There is a report filed by any person, including its
Affiliates and Associates (as defined in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act), on Schedule 13D or
14D-1 (or any successor schedule, form or report) pursuant to the
Exchange Act, disclosing that such person (for the purposes of this
definition only, the term "person" shall include a "person" within the
meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or
any successor provision to either of the foregoing) has become the
beneficial owner (as the term "beneficial owner" is defined under Rule
13d-3 or any successor rule or regulation promulgated under the
Exchange Act) of 50% or more of the total voting power in the
aggregate of all classes of capital stock then outstanding of the
Parent or any Borrower normally entitled to vote in elections of
directors; provided, however, that a person shall not be deemed
beneficial owner of, or to own beneficially, (A) any securities
tendered pursuant to a tender or exchange offer made by or on behalf
of such person or any of such person's Affiliates or Associates until
such tendered securities are accepted for purchase or exchange
thereunder, or (B) any securities if such beneficial ownership (1)
arises solely as a result of a revocable proxy delivered in response
to a proxy or consent solicitation made pursuant to, and in accordance
with, the applicable rules and regulations under the Exchange Act, and
(2) is not also then reportable on Schedule 13D (or any successor
schedule, form or report) under the Exchange Act; or
(c) The occurrence of any transaction or event in connection
with which all or substantially all Common Stock shall be exchanged
for, converted into, acquired for or constitute solely the right to
receive consideration (whether by means of an exchange offer,
liquidation, tender offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise) all or substantially
all of which consists of common stock which is (or, upon consummation
of or immediately following such transaction or event, which will be)
listed on a United States national securities exchange or approved for
quotation on the Nasdaq National Market or any similar United States
system of automated dissemination of quotations of securities prices;
or
(d) The Parent shall cease to be the owner of 100% of the
capital stock of ATI.
Notwithstanding the foregoing, a Change in Control shall not
be deemed to have occurred if at any time the Parent, any Subsidiary
of the Parent, any employee stock ownership plan or any other employee
benefit plan of either the Parent or any Subsidiary of the Parent, or
any person holding shares of Common Stock for or pursuant to the terms
of any such employee benefit plan, files or becomes obligated to file
a report under or in response to Schedule 13D or Schedule 14D-1 (or
any successor schedule, form or report) under the Exchange Act
disclosing beneficial ownership by it of 50% or more of the total
voting power in the aggregate of all classes of Common Stock then
outstanding of the Parent normally entitled to vote in elections of
directors.
"Claim" shall mean any claim or demand, by any Person, of
whatsoever kind or nature for any actual or alleged Liabilities and Costs,
whether based in contract, tort, implied or express warranty, strict liability,
criminal or civil statute, license, permit, ordinance or regulation, common law
or otherwise.
"Clearing Bank" means Wachovia, National Association, or any
other banking institution with whom the Payment Account has been established
pursuant to the Blocked Account Agreement.
"Closing Fee" has the meaning specified in Section 2.4.
"Code" means the Internal Revenue Code of 1986 as from time to
time amended, or any successor statute.
"Collateral" means all of each Credit Party's real and personal
property (other than leasehold interests) and all other assets of any Credit
Party from time to time subject to Agent's Liens securing payment or
performance of the Obligations pursuant to the Security Instruments.
"Commercial Judgment" means the reasonable commercial discretion
exercised in good faith based on an event, condition or circumstance either (i)
arising after the Effective Date or (ii) existing on the date hereof to the
extent the Agent has no written record thereof received from the Parent or ATI
prior to the Effective Date.
"Commercial Letter of Credit shall mean any Letter of Credit
which is drawable upon presentation of documents, drafts at sight and time
drafts evidencing the sale or shipment of goods purchased by the Credit Parties
in the ordinary course of its business.
"Commitment" means, at any time with respect to a Lender, the
principal amount set forth beside such Lender's name under the heading
"Commitment" on Schedule 1.1 attached to the Agreement or on the signature page
of the Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder in accordance with the provisions of Section 11.2, as such Commitment
may be adjusted from time to time in accordance with the provisions of Section
11.2, and "Commitments" means, collectively, the aggregate amount of the
commitments of all of the Lenders.
"Common Stock" shall mean the common stock of the Parent, the
par value of which is set forth in the Parent's certificate of incorporation,
as amended, restated or otherwise modified from time to time.
"Contaminant" means any waste, pollutant, hazardous substance,
toxic substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, asbestos in any form or condition, polychlorinated
biphenyls ("PCBs"), or any constituent of any such substance or waste.
"Contractual Obligation", as applied to any Person, shall mean
any provision of any Securities issued by that Person or any indenture,
mortgage, deed of trust, contract, undertaking, document, instrument or other
agreement or instrument to which that Person is a party or by which it or any
of its properties is bound, or to which it or any of its properties is subject
(including any restrictive covenant affecting such Person or any of its
properties).
"Contribution Share" has the meaning specified in Section 13.2.
"Convertible Debentures" shall mean the Convertible Subordinated
Debentures due 2019 issued pursuant to the Convertible Debenture Indenture.
"Convertible Debenture Indenture" shall mean that certain
Indenture, dated as of June 18, 1999, between the Parent and the Bank of New
York, as Trustee.
"Convertible Debentures Note" shall mean the $199,072,000.00
promissory note of ATI dated June 18, 1999 payable to the Parent in respect of
payments due on the Convertible Debentures.
"Continuation/Conversion Date" means the date on which a Loan is
converted into or continued as a LIBOR Loan.
"Credit Card Account" means the right to payment in respect of a
credit card receivable payable, on a non-recourse basis, from the Proprietary
Credit Card Issuer or any major processor or issuer of MasterCard, Visa,
American Express or Discover credit cards or any other nationally or
internationally recognized credit card provider.
"Credit Extension" means the making of Loans to and the issuance
of Letters of Credit for the account of a Borrower hereunder.
"Credit Party" means the Borrowers and the Parent.
"Debt" means, without duplication, all liabilities, obligations
and indebtedness of any Credit Party to any Person, of any kind or nature, now
or hereafter owing, arising, due or payable, howsoever evidenced, created,
incurred, acquired or owing, whether primary, secondary, direct, contingent,
fixed or otherwise, consisting of indebtedness for borrowed money or the
deferred purchase price of property, excluding trade payables, but including
(a) all Obligations; (b) all obligations and liabilities of any Person of the
type described in this definition secured by any Lien on any Credit Party's
property, even though such Credit Party shall not have assumed or become liable
for the payment thereof; provided, however, that all such obligations and
liabilities which are limited in recourse to such property shall be included in
Debt only to the extent of the book value of such property as would be shown on
a balance sheet of such Credit Party prepared in accordance with GAAP; (c) all
obligations or liabilities created or arising under any Capital Lease or
conditional sale or other title retention agreement with respect to property
used or acquired by any Credit Party, even if the rights and remedies of the
lessor, seller or lender thereunder are limited to repossession of such
property; provided, however, that all such obligations and liabilities which
are limited in recourse to such property shall be included in Debt only to the
extent of the book value of such property as would be shown on a balance sheet
of such Credit Party prepared in accordance with GAAP; (d) all obligations and
liabilities under Guaranties of obligations of the type described in this
definition; (e) the present value (discounted at the Base Rate) of lease
payments due under synthetic leases; and (f) all indebtedness, obligations or
other liabilities in respect of Hedge Agreements and Foreign Currency Exchange
Contracts; provided, however, that for purposes of determining Debt, the
"principal amount" of the obligations of the Credit Parties in respect of any
Hedge Agreement or Foreign Currency Exchange Contract at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the
Credit Parties would be required to pay if such Contract were terminated at
such time.
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would constitute an Event of Default.
"Default Rate" means a fluctuating per annum interest rate at
all times equal to the sum of (a) the otherwise applicable Interest Rate plus
(b) two percent (2%) per annum. Each Default Rate shall be adjusted
simultaneously with any change in the applicable Interest Rate. In addition,
the Default Rate shall result in an increase in the Letter of Credit Fee by two
percent (2%) per annum.
"Defaulting Lender" has the meaning specified in Section
12.15(c).
"Deposit Account" means all "deposit accounts" and "securities
accounts" as such terms are defined in the UCC, now or hereafter owned by a
Credit Party.
"Designated Account" has the meaning specified in Section
1.2(c).
"Documents" means all documents as such term is defined in the
UCC, including bills of lading, warehouse receipts or other documents of title,
now owned or hereafter acquired by any Credit Party.
"Domestic Subsidiary" means each Subsidiary other than Foreign
Subsidiaries.
"DOL" means the United States Department of Labor or any
successor department or agency.
"Dollar" and "$" means dollars in the lawful currency of the
United States. Unless otherwise specified, all payments under the Agreements
shall be made in Dollars.
"EBITDA" means, with respect to any fiscal period on a
consolidated basis for the Parent and the Borrowers, Adjusted Net Earnings from
Operations, plus, to the extent deducted in the determination of Adjusted Net
Earnings from Operations for that fiscal period, Interest Expense, Federal,
state, local and foreign income taxes, depreciation and amortization.
"Effective Date" means the date of this Agreement.
"Eligible Accounts" means the Accounts which the Agent in the
exercise of its reasonable commercial discretion determines to be Eligible
Accounts. Without limiting the discretion of the Agent to establish other
criteria of ineligibility, Eligible Accounts shall not, unless the Agent in its
sole discretion elects, include any Account:
(a) that (i) to the extent not a Credit Card Account, has not
been invoiced and billed to the applicable Account Debtor or with respect to
which more than 90 days have elapsed since the date of the original invoice
therefor or which is more than 60 days past due and, (ii) to the extent
constituting a Credit Card Account, shall not be settled with the applicable
credit card issuer within ten (10) Business Days from the date such Credit Card
Account arises;
(b) with respect to which any of the representations,
warranties, covenants, and agreements contained in the Security Agreement are
incorrect or have been breached;
(c) with respect to which Account (or any other Account due from
such Account Debtor), in whole or in part, a check, promissory note, draft,
trade acceptance or other instrument for the payment of money has been
received, presented for payment and returned uncollected for any reason;
(d) which represents a progress billing (as hereinafter defined)
or as to which the applicable Borrower has extended the time for payment
without the consent of the Agent; for the purposes hereof, "progress billing"
means any invoice for goods sold or leased or services rendered under a
contract or agreement pursuant to which the Account Debtor's obligation to pay
such invoice is conditioned upon completion of any further performance under
the contract or agreement;
(e) with respect to which any one or more of the following
events has occurred to the Account Debtor on such Account: death or judicial
declaration of incompetency of an Account Debtor who is an individual; the
filing by or against the Account Debtor of a request or petition for
liquidation, reorganization, arrangement, adjustment of debts, adjudication as
a bankrupt, winding-up, or other relief under the bankruptcy, insolvency, or
similar laws of the United States, any state or territory thereof, or any
foreign jurisdiction, now or hereafter in effect; the making of any general
assignment by the Account Debtor for the benefit of creditors; the appointment
of a receiver or trustee for the Account Debtor or for any of the assets of the
Account Debtor, including, without limitation, the appointment of or taking
possession by a "custodian," as defined in the Federal Bankruptcy Code; the
institution by or against the Account Debtor of any other type of insolvency
proceeding (under the bankruptcy laws of the United States or otherwise) or of
any formal or informal proceeding for the dissolution or liquidation of,
settlement of claims against, or winding up of affairs of, the Account Debtor;
the sale, assignment, or transfer of all or any material part of the assets of
the Account Debtor; the nonpayment generally by the Account Debtor of its debts
as they become due; or the cessation of the business of the Account Debtor as a
going concern;
(f) owed by an Account Debtor with respect to which fifty
percent (50%) or more of the aggregate Dollar amount of outstanding Accounts
owed at such time by such Account Debtor is classified as ineligible under
clause (a) above;
(g) owed by an Account Debtor which: (i) does not maintain its
chief executive office in the United States of America (including Puerto Rico)
or Canada (other than the Province of Newfoundland); or (ii) is not organized
under the laws of the United States of America (including Puerto Rico) or
Canada or any state or province thereof; or (iii) is the government of any
foreign country or sovereign state, or of any state, province, municipality, or
other political subdivision thereof, or of any department, agency, public
corporation, or other instrumentality thereof; except to the extent that such
Account is secured or payable by a letter of credit satisfactory to the Agent
in its discretion;
(h) owed by an Account Debtor which is an Affiliate or employee
of any Borrower;
(i) except as provided in clause (k) below, with respect to
which either the perfection, enforceability, or validity of the Agent's Liens
in such Account, or the Agent's right or ability to obtain direct payment to
the Agent of the proceeds of such Account, is governed by any federal, state,
or local statutory requirements other than those of the UCC;
(j) owed by an Account Debtor to which any Borrower or any of
its respective Subsidiaries, is indebted in any way, or which is subject to any
right of setoff or recoupment by the Account Debtor, unless the Account Debtor
has entered into an agreement acceptable to the Agent to waive setoff rights;
or if the Account Debtor thereon has disputed liability or made any claim with
respect to any other Account due from such Account Debtor; but in each such
case only to the extent of such indebtedness, setoff, recoupment, dispute, or
claim;
(k) owed by the federal government of the United States of
America, or any department, agency, public corporation, or other
instrumentality thereof, unless the Federal Assignment of Claims Act of 1940,
as amended (31 U.S.C. ss. 3727 et seq.), and any other steps necessary to
perfect the Agent's Liens therein, have been complied with to the Agent's
satisfaction with respect to such Account;
(l) owed by any state, municipality, or other political
subdivision of the United States of America, or any department, agency, public
corporation, or other instrumentality thereof and as to which the Agent
determines that its Lien therein is not or cannot be perfected;
(m) which represents a sale on a bill-and-hold, guaranteed sale,
sale and return, sale on approval, consignment, or other repurchase or return
basis;
(n) which is evidenced by a promissory note or other instrument
or by chattel paper not in the possession of the Agent;
(o) if the Agent believes, in the exercise of its reasonable
judgment, that the prospect of collection of such Account is impaired or that
the Account may not be paid by reason of the Account Debtor's financial
inability to pay;
(p) with respect to which the Account Debtor is located in any
state requiring the filing of a Notice of Business Activities Report or similar
report in order to permit such Borrower to seek judicial enforcement in such
State of payment of such Account, unless such Borrower has qualified to do
business in such state or has filed a Notice of Business Activities Report or
equivalent report for the then current year;
(q) which arises out of a sale not made in the ordinary course
of such Borrower's business;
(r) with respect to which the goods giving rise to such Accounts
have not been shipped and delivered to and accepted by the Account Debtor or
the services giving rise to such Account have not been performed by the
applicable Borrower, and, if applicable, accepted by the Account Debtor, or the
Account Debtor revokes its acceptance of such goods or services;
(s) which is not subject to a first priority and perfected
security interest in favor of the Agent for the benefit of the Lenders.
If the Agent determines in its Commercial Judgment that any
Account at any time ceases to be an Eligible Account, then such Account shall
promptly be excluded from the calculation of Eligible Accounts. Each Borrower
shall notify the Agent if it becomes aware that any Accounts in an amount in
excess of $500,000 which are then currently included in Eligible Accounts has
ceased to constitute Eligible Accounts for any reason; provided, however, the
Borrowers shall have no affirmative duty to monitor, audit or otherwise
investigate the status of any Accounts other than (i) as required under the
terms of the Loan Documents and (ii) as historically conducted in the ordinary
course of business.
"Eligible Appraiser" means (a) Ozer Valuation Services or Bell,
Fore & Mitchell, LLC, and (b) any other independent appraiser acceptable to the
Agent and, so long as no Default or Event of Default is continuing, the
Borrowers.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender that is a commercial financial institution having total assets in excess
of $1,000,000,000; and (c) any other commercial financial institution having
total assets in excess of $1,000,000,000 approved by the Agent (such approval
not to be unreasonably withheld or delayed) after consultation, provided no
Event of Default shall be continuing, with ATI.
"Eligible Equipment" means all equipment, machinery, furniture
and fixtures which the Agent, in the Agent's reasonable judgement, determines
to be Eligible Equipment. Without limiting the ability of the Agent to
establish other criteria of ineligibility, Eligible Equipment shall not, unless
the Agent in its sole discretion elects, include any equipment, machinery,
furniture or fixture:
(a) that is not owned by a Borrower;
(b) that is not subject to the Agent's Liens, which are first
priority and perfected, or that is subject to any other Lien whatsoever (other
than the Liens described in clause (b) of the definition of Permitted Liens
provided that such Permitted Liens (i) are junior in priority to the Agent's
Liens or subject to Reserves and (ii) do not impair directly or indirectly the
ability of the Agent to realize on or obtain the full benefit of the
Collateral);
(c) as to which all of the representations, warranties and
covenants contained in the Security Agreement are not true, correct and
satisfied, as applicable.
(d) that is obsolete; or
(e) that constitute fixtures other than trade fixtures.
If the Agent determines in its Commercial Judgment that any such
equipment, machinery, furniture or fixtures at any time ceases to be Eligible
Equipment, it shall promptly be excluded from Eligible Equipment. Each Borrower
shall notify the Agent if it becomes aware that any Equipment with an appraised
or market value (whichever is higher) in excess of $1,000,000 which is then
currently included in Eligible Equipment has ceased to constitute Eligible
Equipment for any reason; provided, however, the Borrowers shall have no
affirmative duty to monitor, audit or otherwise investigate the status of any
Equipment other than (i) as required under the terms of the Loan Documents and
(ii) as historically conducted in the ordinary course of business.
"Eligible Fixed Assets" means all Eligible Equipment and
Eligible Real Estate.
"Eligible Inventory" means Inventory, which the Agent, in its
reasonable discretion, determines to be Eligible Inventory. Without limiting
the discretion of the Agent to establish other criteria of ineligibility,
Eligible Inventory shall not, unless the Agent in its sole discretion elects,
include any Inventory:
(a) that is not owned by a Borrower;
(b) that is not subject to the Agent's Liens, which are
perfected as to such Inventory, or that are subject to any other Lien
whatsoever (other than the Liens described in clause (b) of the definition of
Permitted Liens provided that such Permitted Liens (i) are junior in priority
to the Agent's Liens or subject to Reserves and (ii) do not impair directly or
indirectly the ability of the Agent to realize on or obtain the full benefit of
the Collateral);
(c) that does not consist of finished goods or raw materials;
(d) that consists of work-in-process, chemicals, samples,
prototypes, supplies, or packing and shipping materials;
(e) that is not unmerchantable, or does not meet all standards
imposed by any Governmental Authority, having regulatory authority over such
goods, their use or sale;
(f) that is obsolete, slow moving or stale;
(g) that is located outside the United States of America or
Puerto Rico (or that is in-transit from vendors or suppliers);
(h) that is located in a public warehouse or in possession of a
bailee or in a facility (other than a retail store location) leased by such
Borrower, if the warehouseman, or the bailee, or the lessor has not delivered
to the Agent, if requested by the Agent, a subordination agreement in form and
substance satisfactory to the Agent or if a Reserve for rents or storage
charges has not been established for Inventory at that location;
(i) that contains or bears any Intellectual Property licensed to
such Borrower by any Person, if the Agent is not reasonably satisfied that it
may sell or otherwise dispose of such Inventory in accordance with the terms of
the Security Agreement and Section 9.2 without infringing the rights of the
licensor of such Intellectual Property or violating any contract with such
licensor (and without payment of any royalties other than any royalties due
with respect to the sale or disposition of such Inventory pursuant to the
existing license agreement), and, as to which such Borrower has not delivered
to the Agent a consent or sublicense agreement from such licensor in form and
substance reasonably acceptable to the Agent if requested;
(j) that is not reflected in the details of a current perpetual
inventory report; or
(k) that is Inventory placed on consignment.
If the Agent determines in its Commercial Judgment that any
Inventory at any time ceases to be Eligible Inventory, such Inventory shall
promptly be excluded from the calculation of Eligible Inventory. Each Borrower
shall notify the Agent if it becomes aware that any Inventory with an appraised
or market value (whichever is higher) in excess of $2,500,000 which is then
currently included in Eligible Inventory has ceased to constitute Eligible
Inventory for any reason; provided, however, the Borrowers shall have no
affirmative duty to monitor, audit or otherwise investigate the status of any
Inventory other than (i) as required under the terms of the Loan Documents and
(ii) as historically conducted in the ordinary course of business.
"Eligible Real Estate" means all Real Estate that the Agent
determines in its reasonable judgment to be Eligible Real Estate. Without
limiting the ability of the Agent to establish other criteria of ineligibility,
Eligible Real Estate shall not, unless the Agent in its sole discretion elects,
include any Real Estate:
(a) that is not owned by a Borrower;
(b) that is not subject to a Mortgage;
(c) as to which all of the representations, warranties and
covenants contained in the Mortgage are not true, correct and satisfied, as
applicable.
"Environmental Claims" means all claims, however asserted, by
any Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for a Release or
injury to the environment.
"Environmental Compliance Reserve" means any reserve which the
Agent establishes in its reasonable discretion after prior written notice to
ATI from time to time for amounts that are reasonably likely to be expended by
any Borrower or its respective Subsidiaries in order for the Borrowers, the
other Credit Parties, and each of its operations and property (a) to comply
with any notice from a Governmental Authority asserting material non-compliance
with Environmental Laws, or (b) to correct any such material non-compliance
identified in a report delivered to the Agent and the Lenders pursuant to
Section 7.7.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes, together
with all administrative orders, directed duties, licenses, authorizations and
permits of, and agreements with, any Governmental Authority, in each case
relating to environmental, health, safety and land use matters.
"Environmental Lien" means a Lien in favor of any Governmental
Authority for (a) any liability under Environmental Laws, or (b) damages
arising from, or costs incurred by such Governmental Authority in response to,
a Release or threatened Release of a Contaminant into the environment.
"Equipment" means all of the Borrowers' now owned and hereafter
acquired machinery, equipment, furniture, furnishings, fixtures, and other
tangible personal property (except Inventory), including embedded software,
motor vehicles with respect to which a certificate of title has been issued,
aircraft, dies, tools, jigs, molds and office equipment, as well as all of such
types of property leased by any Borrower and all of each Borrowers' rights and
interests with respect thereto under such leases (including, without
limitation, options to purchase); together with all present and future
additions and accessions thereto, replacements therefor, component and
auxiliary parts and supplies used or to be used in connection therewith, and
all substitutes for any of the foregoing, and all manuals, drawings,
instructions, warranties and rights with respect thereto; wherever any of the
foregoing is located.
"ERISA" means the Employee Retirement Income Security Act of
1974, and regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with any Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan, (b) a withdrawal by any Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it
was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under Section
4062(e) of ERISA, (c) a complete or partial withdrawal by any Borrower or any
ERISA Affiliate from a Multi-employer Plan or notification that a
Multi-employer Plan is in reorganization, (d) the filing by the PBGC of a
notice of intent to terminate, the treatment by the PBGC of a Plan amendment as
a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multi-employer Plan, (e)
the occurrence of an event or condition which could reasonably be expected to
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan or Multi-employer
Plan, or (f) the imposition of any liability under Title IV of ERISA, other
than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon
any Borrower or any ERISA Affiliate.
"Event of Default" has the meaning specified in Section 9.1.
"Excess Payment" has the meaning specified in Section 13.2.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and regulations promulgated thereunder.
"Existing Letters of Credit" means the outstanding letters of
credit issued under the Original Credit Agreement all of which are set forth on
Schedule 1.4.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate charged to
the Bank on such day on such transactions as determined by the Agent.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any successor thereto.
"Fee Letter" has the meaning given to such term in Section 2.4.
"Financial Statements" means, according to the context in which
it is used, the financial statements referred to in Sections 5.2 and 6.6 or any
other financial statements required to be given to the Lenders pursuant to this
Agreement.
"Fiscal Year" means the Borrowers' fiscal year for financial
accounting purposes. The current Fiscal Year of each Borrower will end on
January 31, 2004.
"Fixed Assets" means real property and equipment, machinery,
furniture and fixtures which are properly categorized as "fixed assets" in
accordance with GAAP.
"Fixed Charge Coverage Ratio" means, with respect to any
Twelve-Month Period, the ratio of (a) EBITDA minus Capital Expenditures
(excluding Capital Expenditures funded with Debt other than Revolving Loans)
paid in cash during such period by the Parent and the Borrowers to (b) Fixed
Charges.
"Fixed Charges" means, with respect to any Twelve-Month Period
of the Parent and the Borrowers on a consolidated basis, without duplication,
Interest Expense, all scheduled principal payments of Debt, all Restricted
Payments during such period, and Federal, state, local and foreign income
taxes, excluding deferred taxes, paid or accrued during such period.
"Foreign Currency Exchange Contracts" shall mean any foreign
currency exchange agreement or other currency exchange rate arrangement
providing currency exchange rate protection, entered into by any Borrower, the
Parent or any of their respective Restricted Subsidiaries.
"Foreign Subsidiary" means (a) any Subsidiary that is not
organized under a political subdivision of the United States of America or (b)
which is organized under the laws of the United States of America, any state
thereof or the District of Columbia, but for which no more than a de minimis
amount of such Subsidiary's assets consist of assets other than capital stock
or in indebtedness of one or more Foreign Subsidiaries (within the meaning of
clause (a) of this definition).
"Fronting Fee" has the meaning given to such term in Section
2.6.
"Fully Supported" means, with respect to any outstanding Letter
of Credit, the Borrowers shall have deposited with the Agent, for the ratable
benefit of the applicable Letter of Credit Issuer and the Lenders, at the
Agent's election, either (a) a standby letter of credit (a "Supporting Letter
of Credit") in form and substance satisfactory to the Agent, issued by an
issuer satisfactory to the Agent in an amount equal to the greatest amount for
which such Letter of Credit may be drawn plus any fees and expenses associated
with such Letter of Credit (the "Letter of Credit Exposure"), under which
Supporting Letter of Credit the Agent shall be entitled to draw amounts
necessary to reimburse the Letter of Credit Issuer and the Lenders for payments
to be made by the applicable Letter of Credit Issuer and the Lenders under such
Letter of Credit and any fees and expenses associated with such Letter of
Credit or (b) cash in an amount equal to the Letter of Credit Exposure to be
held as cash collateral for such Letter of Credit Exposure.
"Funding Date" means the date on which a Borrowing occurs.
"GAAP" means generally accepted accounting principles and
practices set forth from time to time in the opinions and pronouncements of the
Accounting Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which, solely in the case of
computation of the Fixed Charge Coverage Ratio, are applicable to the
circumstances as of the Effective Date.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Guarantor" means the Parent and each Borrower pursuant to the
terms of Article 13 hereof.
"Guaranty" means, with respect to any Person, all obligations of
such Person which in any manner directly or indirectly guarantee or assure, or
in effect guarantee or assure, the payment or performance of any indebtedness,
dividend or other obligations of any other Person (the "guaranteed
obligations"), or assure or in effect assure the holder of the guaranteed
obligations against loss in respect thereof, including any such obligations
incurred through an agreement, contingent or otherwise: (a) to purchase the
guaranteed obligations or any property constituting security therefor; (b) to
advance or supply funds for the purchase or payment of the guaranteed
obligations or to maintain a working capital or other balance sheet condition;
or (c) to lease property or to purchase any debt or equity securities or other
property or services.
"Hedge Agreement" means any and all transactions, agreements or
documents now existing or hereafter entered into, which provides for an
interest rate, credit, commodity or equity swap, cap, floor, collar, forward
foreign exchange transaction, currency swap, cross currency rate swap, currency
option, or any combination of, or option with respect to, these or similar
transactions, for the purpose of hedging any Borrower's exposure to
fluctuations in interest or exchange rates, loan, credit exchange, security or
currency valuations or commodity prices.
"Illiquidity Period" means the period beginning on the date that
Liquidity shall be less than $35,000,000 and ending on the first date
thereafter that Liquidity shall be in excess of $50,000,000 for a period of
thirty (30) consecutive days.
"In-Transit Inventory" means Inventory other than Eligible
Inventory that is in transit to properties owned or leased by any Borrower in
the United States which, upon arrival in the United States, will constitute
Eligible Inventory and which is not reflected on the stock ledger of such
Borrower.
"Initial Determination Date" has the meaning given to such term
in the definition of Applicable Margin.
"Intellectual Property" has the meaning set forth in Section
6.23.
"Interest Expense" means, for any fiscal period, the aggregate
amount of interest required to be paid or accrued by the Parent and the
Borrowers during such period on all Debt of the Parent and the Borrowers during
such period, whether such interest was or is required to be reflected as an
item of expense or capitalized, including payments consisting of interest in
respect of Capital Leases or synthetic leases), net of all interest income they
receive during such period.
"Interest Period" means, as to any LIBOR Loan, the period
commencing on the Funding Date of such Loan or on the Continuation/Conversion
Date on which the Loan is converted into or continued as a LIBOR Loan, and
ending on the date one, two, three or six months thereafter as selected by the
applicable Borrower in its Notice of Borrowing, in the form attached hereto as
Exhibit D, or Notice of Continuation/Conversion, in the form attached hereto as
Exhibit E, provided that:
(a) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall be extended to the following
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the preceding Business Day;
(b) any Interest Period pertaining to a LIBOR Loan that begins
on the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the end of
such Interest Period; and
(c) no Interest Period shall extend beyond the Stated
Termination Date.
"Interest Rate" means each or any of the interest rates,
including the Default Rate, set forth in Section 2.1.
"Inventory" means all of the Borrowers' now owned and hereafter
acquired inventory, goods and merchandise, wherever located, to be furnished
under any contract of service or held for sale or lease, all returned goods,
raw materials, work-in-process, finished goods (including embedded software),
other materials and supplies of any kind, nature or description which are used
or consumed in the Borrowers' business or used in connection with the packing,
shipping, advertising, selling or finishing of such goods, merchandise, and all
documents of title or other Documents representing them.
"Investment" shall mean, as applied to any Person, (a) any
direct or indirect purchase or other acquisition by that Person of all or
substantially all of the assets of any other Person or a line of business of
any other Person, or of Securities, or of a beneficial interest in Securities,
of any other Person, and (b) any direct or indirect loan, advance (other than
deposits with financial institutions available for withdrawal on demand,
prepaid expenses, advances to such Person, to employees and similar items made
or incurred in the ordinary course of business), or capital contribution by
such Person to any other Person, including all Accommodation Obligations
provided by such Person to or for the benefit of such other Person and all Debt
and accounts owed to such Person by that other Person which are not current
assets or did not arise from sales of goods or services to that Person in the
ordinary course of business. The amount of any Investment shall be determined
in conformity with GAAP.
"IRS" means the Internal Revenue Service and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Issuing Bank Agreement" means, as to each Letter of Credit
Issuer, any agreement entered into by such Letter of Credit Issuer and a
Borrower relating to Letters of Credit.
"Latest Projections" means: (a) on the Effective Date and
thereafter until the Agent receives new projections pursuant to Section 5.2(d),
the projections of the Borrowers' consolidated financial condition, results of
operations, and cash flows, for the period commencing on February 1, 2003 and
ending on January 31, 2009, and delivered to the Agent prior to the Effective
Date; and (b) thereafter, the projections most recently received by the Agent
pursuant to Section 5.2(d).
"Lender" and "Lenders" have the meanings specified in the
introductory paragraph hereof and shall include the Agent to the extent of any
Agent Advance outstanding and the Bank to the extent of any Non-Ratable Loan
outstanding; provided that no such Agent Advance or Non-Ratable Loan shall be
taken into account in determining any Lender's Pro Rata Share.
"Letter of Credit" shall mean any Commercial Letter of Credit or
any Standby Letter of Credit issued by any Letter of Credit Issuer for the
account of any Borrower pursuant to Section 1.4 and includes each Existing
Letter of Credit.
"Letter of Credit Fee" has the meaning specified in Section 2.6.
"Letter of Credit Issuer" means the Bank, Wachovia Bank, National
Association, JP Morgan Chase Bank, any of their Affiliates or any other Lender
selected by the Borrowers and approved by the Agent that agrees to become a
Letter of Credit Issuer.
"Letter of Credit Outstandings" means, at any time, the
aggregate undrawn face amount of all outstanding Letters of Credit at such
time, plus the aggregate unpaid reimbursement obligations with respect to
Letters of Credit at such time.
"Letter of Credit Subfacility" means an amount equal to the
Total Facility Amount.
"Liabilities and Costs" means all liabilities, claims,
obligations, responsibilities, losses, damages, punitive damages, consequential
damages, treble damages, charges, costs and expenses (including attorney's,
expert's and consulting fees and costs of investigation and feasibility
studies), fines, penalties and monetary sanctions, interest, direct or
indirect, known or unknown, absolute or contingent, past, present or future.
"LIBOR Interest Payment Date" means, with respect to a LIBOR
Loan, (a) the Termination Date, (b) the first day of each calendar month during
which such LIBOR Loan is outstanding and (c) the last day of each Interest
Period applicable to such LIBOR Loan.
"LIBOR Loans" means a Revolving Loan during any period in which
it bears interest based on the LIBOR Rate.
"LIBOR Rate" means, for any Interest Period, with respect to
LIBOR Loans, the rate of interest per annum determined pursuant to the
following formula:
LIBOR Rate = Offshore Base Rate
--------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Offshore Base Rate" means the rate per annum appearing on
Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period. If for
any reason such rate is not available, the Offshore Base Rate shall
be, for any Interest Period, the rate per annum appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable
to such Interest Period; 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. If for any reason none of the
foregoing rates is available, the Offshore Base Rate shall be, for
any Interest Period, the rate per annum determined by Agent as the
rate of interest at which dollar deposits in the approximate amount
of the LIBOR Loan comprising part of such Borrowing would be offered
by the Bank's London Branch to major banks in the offshore dollar
market at their request at or about 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during
any Interest Period, the reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
applicable to member banks under regulations issued from time to time
by the Federal Reserve Board for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Offshore Base Rate
for each outstanding LIBOR Loan shall be adjusted automatically as of
the effective date of any change in the Eurodollar Reserve
Percentage.
"Lien" means: (a) any interest in property securing an
obligation owed to, or a claim by, a Person other than the owner of the
property, whether such interest is based on the common law, statute, or
contract, and including a security interest, charge, claim, or lien arising
from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment,
deposit arrangement, agreement, security agreement, conditional sale or trust
receipt or a lease, consignment or bailment for security purposes; (b) to the
extent not included under clause (a), any reservation, exception, encroachment,
easement, right-of-way, covenant, condition, restriction, lease or other title
exception or encumbrance affecting property; and (c) any contingent or other
agreement to provide any of the foregoing.
"Liquidation Percentage" means, with respect to Inventory of a
Borrower at any time, the ratio (expressed as a percentage) computed by
dividing (a) (i) if such percentage is being determined on the Effective Date
or on any date prior to the first delivery of an appraisal requested in
accordance with Section 7.4, the net orderly liquidation value of the Inventory
of such Borrower, as set forth in the appraisal delivered to the Agents prior
to the Effective Date and (ii) if such percentage is being determined on or
after the date of the first delivery of an appraisal requested in accordance
with Section 7.4, the net orderly liquidation value of the Inventory of the
Borrower, as set forth in the appraisal most recently delivered pursuant to
Section 7.4 by (b) the value of the Inventory of such Borrower, valued at cost
as set forth in the corresponding appraisal.
"Liquidity" means, on any date of determination thereof, (a) the
difference of (but not less than zero) (i) the sum of (A) all cash of the
Credit Parties held in an Approved Deposit Accounts on such date, plus (B) all
Cash Equivalents owned by the Credit Parties and reflected on the most recent
balance sheet of the Parent prepared prior such date, minus (ii) $50,000,000
plus (b) Availability on such date; provided, however, that if at any date of
determination of Liquidity there shall have been no Revolving Loans outstanding
during the immediately preceding ninety (90) days (or if any Revolving Loans
were outstanding during such period they shall not have been outstanding for a
continuous period of ten or more Business Days), then Liquidity shall be
determined based upon Adjusted Availability.
"Loan Account" means the loan account of each Borrower, which
account shall be maintained by the Agent.
"Loan Documents" means this Agreement, the Security Instruments,
the Parent Guaranty, and any other agreements, instruments, and documents
heretofore, now or hereafter evidencing, securing, guaranteeing or otherwise
relating to the Obligations, the Collateral, or any other aspect of the
transactions contemplated by this Agreement.
"Loans" means, collectively, all loans and advances provided for
in Article 1.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the Federal Reserve Board.
"Material Adverse Effect" means (a) a material adverse change
in, or a material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of the Credit Parties taken as
a whole or any material portion of the Collateral; (b) a material impairment of
the ability of any Borrower or any other Credit Party to perform under any Loan
Document to which it is a party; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against any Credit Party
of any Loan Document to which it is a party.
"Moody's" means Moody's Investors Service, Inc.
"Mortgages" means and includes any and all of the mortgages,
deeds of trust, deeds to secure debt, assignments and other instruments
executed and delivered by any Credit Party to or for the benefit of the Agent
by which the Agent, on behalf of the Lenders, acquires a Lien on the Real
Estate or a collateral assignment of the Credit Parties' interest under leases
of Real Estate, and all amendments, modifications and supplements thereto
"Multi-employer Plan" means a "multi-employer plan" as defined
in Section 4001(a)(3) of ERISA which is or was at any time during the current
year or the immediately preceding six (6) years contributed to by any Borrower
or any ERISA Affiliate.
"Net Amount of Eligible Accounts" means, at any time, the gross
unpaid amount of Eligible Accounts and less returns, discounts, claims, credits
allowances, accrued rebates, offsets, deductions, counterclaims, disputes and
other defenses of any nature at any time issued, owing, granted, outstanding,
available or claimed.
"Non-Ratable Loan" and "Non-Ratable Loans" have the meanings
specified in Section 1.2(h).
"Non-U.S. Lender" has the meaning specified in Section 4.1(e).
"Notice of Borrowing" has the meaning specified in Section
1.2(b).
"Notice of Continuation/Conversion" has the meaning specified in
Section 2.2(b).
"Obligations" means all present and future loans, advances,
liabilities, obligations, covenants, duties, and debts owing by any Credit
Party to the Agent and/or any Lender, arising under or pursuant to this
Agreement or any of the other Loan Documents, whether or not evidenced by any
note, or other instrument or document, whether arising from an extension of
credit, opening of a letter of credit, acceptance, loan, guaranty,
indemnification or otherwise, whether direct or indirect, absolute or
contingent, due or to become due, primary or secondary, as principal or
guarantor, and including all principal, interest, charges, expenses, fees,
attorneys' fees, filing fees and any other sums chargeable to any Credit Party
hereunder or under any of the other Loan Documents. "Obligations" includes,
without limitation, (a) all debts, liabilities, and obligations now or
hereafter arising from or in connection with the Letters of Credit and (b) all
debts, liabilities and obligations now or hereafter arising from or in
connection with Bank Products; provided, however, that to the extent that the
aggregate amount of all Obligations is in excess of the value, as determined
under Section 506 of the Bankruptcy Code, of all Collateral, the debts,
liabilities and obligations of the Borrowers under Bank Products in the amount
of such excess shall not constitute "Obligations" hereunder.
"Operating Lease" shall mean, as applied to any Person, any
lease of any property by that Person as lessee which is not a Capital Lease.
"Original Credit Agreement" means that certain $175,000,000
Amended and Restated Credit Agreement dated April 30, 2001 by and between ATI,
Bank of America, N.A., as administrative agent, the lenders party thereto, the
arranger party thereto, the Syndication Agents party thereto, the documentation
agent party thereto and the co-agents party thereto, as amended.
"Original Subsidiary Agreements" means the collective reference
to (i) that certain Subsidiary Guaranty and Collateral Agreement dated June 30,
1998, between AT Distribution and the Agent, as amended and (ii) that certain
Assignment and Assumption Agreement dated as of February 29, 2000, between AT
Retail, ANNCO and the Agent.
"Other Taxes" means any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other Loan
Documents.
"Parent" shall mean AnnTaylor Stores Corporation, a Delaware
corporation.
"Parent Guaranty" shall mean the Second Amended and Restated
Guaranty dated as of the Effective Date substantially in the form of, and on
the terms set forth in, Exhibit H, as the same may be amended, modified or
otherwise supplemented from time to time.
"Participant" means any Person who shall have been granted the
right by any Lender to participate in the financing provided by such Lender
under this Agreement, and who shall have entered into a participation agreement
in form and substance satisfactory to such Lender.
"Participation Register" has the meaning specified in Section
11.2(e).
"Payment Account" means the bank account established pursuant to
the Security Agreement, to which amounts held in the Approved Deposit Accounts
of the Parent and the Borrowers are swept and deposited or credited, and which
is maintained in the name of the Agent or any Borrower, as the Agent may
determine, on terms acceptable to the Agent.
"PBGC" means the Pension Benefit Guaranty Corporation or any
Governmental Authority succeeding to the functions thereof.
"Pending Revolving Loans" means, at any time, the aggregate
principal amount of all Revolving Loans requested in any Notice of Borrowing
received by the Agent which have not yet been advanced.
"Pension Plan" means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which any Borrower (or an ERISA
Affiliate) sponsors, maintains, or to which it makes, is making, or is
obligated to make contributions, or in the case of a Multi-employer Plan has
made contributions at any time during the immediately preceding five (5) plan
years.
"Permitted Existing Debt" shall mean the Debt existing on the
date hereof and set forth in Schedule 6.9.
"Permitted Existing Liens" shall mean the Liens on any property,
other than any Environmental Liens, reflected on Schedule 7.10(b).
"Permitted Liens" means:
(a) Liens (other than Environmental Liens and any Lien
imposed under ERISA) for claims, taxes, assessments or charges of any
Governmental Authority in an aggregate amount not in excess of
$1,000,000 which are not yet due or which are being contested in good
faith by appropriate proceedings and with respect to which adequate
reserves or other appropriate provisions are being maintained in
accordance with GAAP and as to which a stay of enforcement is in
effect;
(b) statutory Liens of landlords, bankers, carriers,
warehousemen, mechanics, materialmen and other similar Liens (other
than any Lien imposed under ERISA or any Environmental Lien) imposed
by law, arising in the ordinary course of business securing
obligations in an aggregate amount (i) not in excess of $2,500,000
for all such Liens other than landlord Liens and (ii) not in excess
of $15,000,000 for landlord liens, and, in each case, for amounts
which (A) are not yet due, (B) are not more than 30 days past due as
long as no notice of default has been given or other action taken to
enforce such Liens, or (C)(1) are not more than 30 days past due and
a notice of default has been given or other action taken to enforce
such Liens, or (2) are more than 30 days past due, and, in the case
of clause (1) or (2), are being contested in good faith by
appropriate proceedings which are sufficient to prevent imminent
foreclosure of such Liens and with respect to which adequate reserves
or other appropriate provisions are being maintained in accordance
with GAAP and as to which a stay of enforcement is in effect;
(c) Liens (other than any Lien imposed under ERISA or any
Environmental Lien) incurred or deposits made in the ordinary course
of business (including surety bonds and appeal bonds) in connection
with workers' compensation, unemployment insurance and other types of
employment benefits or to secure the performance of tenders, bids,
leases, contracts (other than in respect of Debt), statutory
obligations and other similar obligations or arising as a result of
progress payments under government contracts;
(d) easements (including reciprocal easement agreements and
utility agreements), rights-of-way, covenants, consents, rights of
landlords, reservations, encroachments, variations and other
restrictions, charges or encumbrances (whether or not recorded)
affecting the use of Real Estate, which do not materially detract
from the value of such Real Estate or materially interfere with its
use in the ordinary conduct of the business of any Borrower;
(e) Liens arising from judgments and attachments in
connection with court proceedings provided that the attachment or
enforcement of such Liens would not result in an Event of Default
hereunder and such judgments are being contested in good faith by
appropriate proceedings, adequate reserves have been set aside and no
material property is subject to a material risk of loss or forfeiture
and the claims in respect of such Liens are fully covered by
insurance (subject to ordinary and customary deductibles) and a stay
of execution pending appeal or proceeding for review is in effect.
(f) Liens on goods in favor of customs and revenue
authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of such goods; provided
that if such Liens secure obligations in an amount in excess of
$1,000,000, the applicable Borrower shall have provided written
notice and a description of such Liens to the Agent.
"Person" means any individual, sole proprietorship, partnership,
limited liability company, joint venture, trust, unincorporated organization,
association, corporation, Governmental Authority, or any other entity.
"Plan" means an employee benefit plan (as defined in Section
3(3) of ERISA) which any Borrower (or an ERISA Affiliate) sponsors or maintains
or to which any Borrower (or an ERISA Affiliate) makes, is making, or is
obligated to make contributions and includes any Pension Plan.
"Proprietary Credit Card Issuer" means Alliance Data Systems
Corporation or any successor or replacement issuer or manager of a credit card
program acceptable to the Agent.
"Pro Rata Guaranty Share" has the meaning specified in Section
13.2.
"Pro Rata Share" means, with respect to a Lender, a fraction
(expressed as a percentage), the numerator of which is the amount of such
Lender's Commitment and the denominator of which is the sum of the amounts of
all of the Lenders' Commitments, or if no Commitments are outstanding, a
fraction (expressed as a percentage), the numerator of which is the amount of
Obligations owed to such Lender and the denominator of which is the aggregate
amount of the Obligations owed to the Lenders, in each case giving effect to a
Lender's participation in Non-Ratable Loans and Agent Advances.
"Rate Suspension Notice" has the meaning specified in Section
4.5.
"Real Estate" means all of any Credit Party's now or hereafter
owned or leased estates in real property, including, without limitation, all
fees, leaseholds and future interests, together with all of such Credit Party's
now or hereafter owned or leased interests in the improvements thereon, the
fixtures attached thereto and the easements appurtenant thereto.
"Release" means a release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration of a
Contaminant into the indoor or outdoor environment or into or out of any Real
Estate or other property, including the movement of Contaminants through or in
the air, soil, surface water, groundwater or Real Estate or other property.
"Report" has the meaning given to such term in Section 12.18(a).
"Reportable Event" means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such event for
which the 30-day notice requirement under ERISA has been waived in regulations
issued by the PBGC.
"Required Lenders" means at any time Lenders whose Pro Rata
Shares aggregate more than 50% of the aggregate of all Lenders' Pro Rata
Shares.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule, order, regulation or determination of an arbitrator
or of a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property is
subject.
"Reserves" means reserves that limit the availability of credit
hereunder, consisting of reserves against Availability, Eligible Accounts,
Eligible Inventory or Eligible Fixed Assets established by the Agent from time
to time in its Commercial Judgment. Without limiting the generality of the
foregoing, the following reserves shall be deemed to be an exercise of Agent's
Commercial Judgment: (a) Bank Product Reserves, (b) a reserve for accrued,
unpaid interest on the Obligations, (c) inventory shrinkage, and (d)
warehousemen's or bailees' charges.
"Responsible Officer" means the chief executive officer, the
chief operating officer, the president, the chief financial officer, the
controller, the assistant secretary, the general counsel (other than with
respect to financial reporting matters), any senior vice president or any
assistant treasurer of the applicable Borrower, or any other officer having
substantially the same authority and responsibility.
"Restated Subsidiary Guaranty" means that certain Amended and
Restated Subsidiary Guaranty and Collateral Agreement dated April 30, 2001, as
amended, pursuant to which the Original Subsidiary Agreements were amended and
restated.
"Restricted Payment" shall mean (a) any dividend or other
distribution, direct or indirect (including by means of any Accommodation
Obligation), on account of any shares of any class of capital stock of the
Parent or any Borrower or any of its respective Subsidiaries now or hereafter
outstanding, including the Common Stock, except a distribution of stock as part
of a stock split and except a dividend payable solely in shares of that class
of stock or in any junior class of stock to the holders of that class, (b) 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 the Parent or any Borrower or any of its respective
Subsidiaries now or hereafter outstanding, (c) any payment or prepayment of
principal of, premium, if any, or interest on, and any redemption, purchase,
retirement or defeasance of, or sinking fund or similar payment with respect
to, the Convertible Debentures or any consideration paid to any Person for the
purpose of any of the foregoing; provided that Restricted Payments shall not
include (a) any payments made with respect to the Convertible Debentures (or
the conversion thereof) in Common Stock of the Parent, (b) any cash payments
made with respect to the Convertible Debentures in lieu of fractional shares of
Common Stock (as required to be paid in cash pursuant to the terms of the
Convertible Debentures) and (c) any cash payments required to be made to the
holders of the Convertible Debentures in order to pay taxes incurred by such
holders in connection with the conversion of the Convertible Debentures, and
(d) 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 the Parent or any Borrower or any of any Borrower's Subsidiaries now
or hereafter outstanding.
"Revolving Loans" has the meaning specified in Section 1.2 and
includes each Agent Advance and Non-Ratable Loan.
"S&P" means Standard & Poor's Ratings Group, a division of The
McGraw-Hill Companies, Inc.
"SEC" means the Securities and Exchange Commission, or any other
Governmental Authority succeeding to any of its principal functions.
"Securities" shall mean any stock, shares, voting trust
certificates, bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities", or any certificates of interest,
shares, or participations in temporary or interim certificates for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, but shall not include any evidence of the Obligations.
"Securities Act" shall mean the Securities Act of 1933, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"Security Agreement" means the Second Amended and Restated
Pledge and Security Agreement dated as of the date hereof by the Borrowers and
the Parent to the Agent in Form of Exhibit G hereto, and each other security
agreement delivered pursuant to the terms of the Loan Documents, each as
hereafter modified, amended or supplemented from time to time.
"Security Instruments" means, collectively, the Security
Agreement, the Parent Guaranty, the Blocked Account Agreements, the Mortgages
and all other agreements (including control agreements), instruments and other
documents, whether now existing or hereafter in effect, pursuant to which any
Credit Party or other Person shall grant or convey to the Agent or the Lenders
a Lien in, or any other Person shall acknowledge any such Lien in, property as
security for all or any portion of the Obligations or any other obligation
under any Loan Document, as any of them may be amended, modified or
supplemented from time to time.
"Settlement" and "Settlement Date" have the meanings specified
in Section 12.15(a)(ii).
"Solvent" means, when used with respect to any Person, that at
the time of determination:
(a) the assets of such Person, at a fair valuation, are in
excess of the total amount of its debts (including contingent
liabilities); and
(b) the present fair saleable value of its assets is greater
than its probable liability on its existing debts as such debts
become absolute and matured; and
(c) it is then able and expects to be able to pay its debts
(including contingent debts and other commitments) as they mature;
and
(d) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted.
For purposes of determining whether a Person is Solvent, the
amount of any contingent liability shall be computed as the amount that, 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.
"Standby Letter of Credit" shall mean any Letter of Credit which
is not a Commercial Letter of Credit.
"Stated Termination Date" means November 14, 2008.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business entity
of which more than fifty percent (50%) of the voting stock or other equity
interests (in the case of Persons other than corporations), is owned or
controlled directly or indirectly by the Person, or one or more of the
Subsidiaries of such Person, or a combination thereof. Unless the context
otherwise clearly requires, references herein to a "Subsidiary" refer to a
Subsidiary of a Borrower.
"Taxes" means any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, but excluding, in the case of each Lender and the Agent, taxes imposed
on its net income (including, without limitation, branch profits taxes and
franchise taxes imposed on it) by the United States of America or any
Governmental Authority of any jurisdiction where such Lender or Agent is
organized or maintains a lending office.
"Termination Date" means the earliest to occur of (i) the Stated
Termination Date, (ii) the date the Total Facility is terminated either by the
Borrowers pursuant to Section 3.2 or by the Required Lenders pursuant to
Section 9.2, and (iii) the date this Agreement is otherwise terminated for any
reason whatsoever pursuant to the terms of this Agreement.
"Termination Event" shall mean (i) a Reportable Event with
respect to any Plan; (ii) the withdrawal of ATI or any ERISA Affiliate from a
Benefit Plan during a plan year in which ATI or such ERISA Affiliate was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA or the
cessation of operations which results in the termination of employment of 20%
of Benefit Plan participants who are employees of ATI and its ERISA Affiliates;
(iii) the imposition of an obligation on ATI or any ERISA Affiliate under
Section 4041 of ERISA to provide affected parties written notice of intent to
terminate a Benefit Plan in a distress termination described in Section 4041(c)
of ERISA; (iv) the termination of, or the institution under ERISA of
proceedings to terminate, a Benefit Plan (including the giving of written
notice thereof); (v) any event or condition which constitutes grounds under
Section 4042 of ERISA (excluding Section 4042(a)(4)) for the termination of, or
the appointment of a trustee to administer, any Benefit Plan (including the
giving of written notice thereof); (vi) the partial or complete withdrawal of
ATI or any ERISA Affiliate from a Multi-employer Plan or notification that a
Multi-employer Plan is in reorganization; (vii) any "accumulated funding
deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan; (viii) ATI or any ERISA Affiliate has incurred
or is likely to incur a liability in connection with any nonexempt "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan; (ix) the failure to make a required contribution to a
Benefit Plan if such failure is sufficient to give rise to a lien under Section
302 (f) of ERISA; or (x) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon ATI or any ERISA Affiliate.
"Total Facility" has the meaning specified in Section 1.1.
"Total Facility Amount" has the meaning specified in Section
1.1.
"Transfer" has the meaning specified in Section 11.2(e).
"Transferee" has the meaning specified in Section 11.2(e).
"Twelve-Month Period" a period of twelve full consecutive fiscal
months of the Borrowers and their Subsidiaries, taken together as one
accounting period.
"UCC" means the Uniform Commercial Code, as in effect from time
to time, of the State of New York or of any other state the laws of which are
required as a result thereof to be applied in connection with the issue of
perfection of security interests; provided, that to the extent that the UCC is
used to define any term herein or in any other documents and such term is
defined differently in different Articles or Divisions of the UCC, the
definition of such term contained in Article or Division 9 shall govern.
"Unfunded Pension Liability" means the excess of a Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
"Unrestricted Subsidiary" shall mean any Foreign Subsidiary
(other than a Foreign Subsidiary which is a Borrower) and any other Subsidiary
of any Borrower which has been designated as such by resolution duly adopted by
the board of directors of such Borrower, which at the time of such designation
does not own or hold any Securities of the Parent or any Borrower, provided (a)
no Subsidiary of a Borrower shall be (or if already an Unrestricted Subsidiary
shall immediately cease to be) an Unrestricted Subsidiary if, at any time, the
Parent or any Borrower shall create, incur, issue, assume, guarantee or in any
other manner whatsoever be or become liable with respect to any Claim against
or any Contractual Obligation or Debt of, such Subsidiary which is not
permitted under Article 7 and (b) the Parent or the Borrowers shall be deemed
to have made an Investment in an Unrestricted Subsidiary at the time of
designation of such Subsidiary as an "Unrestricted Subsidiary" in an amount
equal to the sum of (i) any Debt owed by such Subsidiary to the Parent and any
Borrower at such time, (ii) any outstanding Guarantees or Liens created by the
Parent or any Borrower in favor of or for the benefit of such Subsidiary and
(iii) the total assets of such Subsidiary at such time as determined on a
consolidated basis in accordance with GAAP. As of the Effective Date, the
following Subsidiaries are Unrestricted Subsidiaries: AnnTaylor Travel, Inc.,
AnnTaylor Sourcing Far East Ltd., AnnTaylor of Puerto Rico, Inc., AnnTaylor
Sourcing Italy, SRL and AnnTaylor Italy SRL.
"Unused Letter of Credit Subfacility" means an amount equal to
the Letter of Credit Subfacility minus the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit plus, without duplication, (b) the
aggregate unpaid reimbursement obligations with respect to all Letters of
Credit.
"Unused Line Fee" has the meaning specified in Section 2.5.
"Wholly Owned" means, with respect to any Person, a Subsidiary
of such Person, all of the outstanding Capital Stock of which (other than
director's qualifying shares and other similar de minimus issuances required by
law) are at the time owned directly or indirectly by such Person.
2. Accounting Terms. Any accounting term used in the Agreement
shall have, unless otherwise specifically provided herein, the meaning
customarily given in accordance with GAAP, and all financial computations in
the Agreement shall be computed, unless otherwise specifically provided
therein, in accordance with GAAP as consistently applied and using the same
method for inventory valuation as used in the preparation of the Financial
Statements.
3. Interpretive Provisions. (a) The meanings of defined terms
are equally applicable to the singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and similar words
refer to the Agreement as a whole and not to any particular provision of the
Agreement; and Subsection, Section, Schedule and Exhibit references are to the
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means
"including without limitation."
(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including," the words "to" and "until" each mean "to but
excluding" and the word "through" means "to and including."
(iv) The word "or" is not exclusive.
(d) Unless otherwise expressly provided herein, (i) references
to agreements (including the Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications thereto,
but only to the extent such amendments and other modifications are not
prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation.
(e) The captions and headings of the Agreement and other Loan
Documents are for convenience of reference only and shall not affect the
interpretation of the Agreement.
(f) The Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
(g) For purposes of Section 9.1, a breach of a financial
covenant contained in Sections 7.24 shall be deemed to have occurred as of any
date of determination thereof by the Agent or as of the last day of any
specified measuring period, regardless of when the Financial Statements
reflecting such breach are delivered to the Agent.
(h) The Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the
Borrowers and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Lenders or the Agent
merely because of the Agent's or Lenders' involvement in their preparation.
4. Accounting for Acquisitions.
With respect to any Acquisition consummated on or after the
Effective Date, the following shall apply:
(a) For each of the twelve Twelve-Month Periods ending next
following the date of any Acquisition, EBITDA shall include the results of
operations of the Person or assets so acquired on a historical pro forma basis,
and which amounts may include such adjustments as are permitted under
Regulation S-X of the SEC and reasonably satisfactory to the Agent.
(b) For each of the twelve Twelve-Month Periods ending next
following the date of each Acquisition, Fixed Charges shall include the results
of operations of the Person or assets so acquired, which amounts shall be
determined on a historical pro forma basis; provided, however, Interest Expense
shall be adjusted on a historical pro forma basis to (i) eliminate interest
expense accrued during such period on any Debt repaid in connection with such
Acquisition and (ii) include interest expense on any Debt (including Debt
hereunder) incurred, acquired or assumed in connection with such Acquisition
("Incremental Debt") calculated (x) as if all such Incremental Debt had been
incurred as of the first day of such Twelve-Month Period and (y) at the
following interest rates: (I) for all periods subsequent to the date of the
Acquisition and for Incremental Debt assumed or acquired in the Acquisition and
in effect prior to the date of Acquisition, at the actual rates of interest
applicable thereto, and (II) for all periods prior to the actual incurrence of
such Incremental Debt, equal to the average daily rate of interest actually
applicable to such Incremental Debt hereunder or under other financing
documents applicable thereto, as the case may be.
EXHIBIT A
FORM OF COMPLIANCE CERTIFICATE
This Certificate is delivered to you pursuant to Section 5.2(d) of the
Second Amended and Restated Credit Agreement dated as of November 14, 2003 (as
amended, supplemented or modified from time to time, (the "Credit Agreement"),
among AnnTaylor, Inc. ("ATI"), ANNCO, Inc., AnnTaylor Distribution Services,
Inc., AnnTaylor Retail, Inc. (collectively, the "Borrowers"), Bank of America,
N.A. ("Bank of America"), as Administrative Agent for the Lenders (in such
capacity, (the "Agent"), JPMorgan Chase Bank and Wachovia Bank, National
Association, as Syndication Agents, Fleet Retail Group and The CIT
Group/Business Credit, Inc., as Documentation Agents. Terms defined in the
Credit Agreement and not otherwise defined herein are used herein with the
meanings so defined.
1. I am the duly elected, qualified and acting [Senior Vice President
- - Chief Financial Officer] [Vice President - Controller] of ATI.
2. I have reviewed and am familiar with the contents of this
Certificate. I am providing this Certificate solely in my capacity as an
officer of ATI. The matters set forth herein are true to the best of my
knowledge after due inquiry, but I express no personal opinion as to any
conclusions of law or other legal matters.
3. I have reviewed the terms of the Credit Agreement and the principal
Loan Documents. Such review did not disclose the existence of, and I have no
knowledge of the existence, as of the date of this Certificate, of any
condition or event which constitutes a Default or an Event of Default [, except
as set forth below]. All of the representations and warranties of each Borrower
contained in the Credit Agreement and the other principal Loan Documents are
correct and complete in all material respects as at the date of this
certificate as if made as of the date hereof, except for those that speak as of
a particular date. Each Borrower and each Credit Party is, as of _____________,
___, 200__ [most recent quarter-end] (the "Determination Date") in compliance
in all material respects with all of its respective covenants and agreements in
the Credit Agreement and the other principal Loan Documents. No Illiquidity
Period has arisen or been in effect since the last Compliance Certificate
delivered to the Agent [, except as set forth below].
4. Liquidity as of the Determination Date is as set forth below:
(a) Cash held in Approved Deposit Accounts $___________
(b) Cash Equivalents reflected on most
recently prepared balance sheet $___________
(c) 4(a) plus 4(b) $___________
(d) 4(c) minus $50,000,000* $___________
(e) Availability** $___________
____________
Liquidity $___________
* But not less than zero
** (or Adjusted Availability, if applicable)
5. If the Determination Date is the end of a fiscal quarter of ATI,
attached hereto as Attachment 1 are the computations showing compliance with
the covenants specified therein as of the Determination Date.
6. If any portion of an Illiquidity Period shall have been in effect
during the month ending on the Determination Date, attached hereto as
Attachment 2 is the computation showing compliance with Section 7.24 as of the
Determination Date.
IN WITNESS WHEREOF, I execute this Certificate this ___ day of
___________, 20__.
ANNTAYLOR, INC.
By: _____________________________
Name: _____________________________
Title: _____________________________
Attachment 1
to Exhibit A
The information described herein is as of ___________, ____, and pertains to
the period from _______________, ____ to ________________ __, ____.
I. Negative Covenants
A. Indebtedness (Section 7.9)
Section Amount
7.9(m) $__________
B. Sales (Section 7.10(a))
Section Amount
7.10(a)(ii) $__________
7.10(a)(vii) $__________
7.10(a)(ix) $__________
C. Investments (Section 7.11)
Section Amount
7.11(e) $__________
7.11(f) $__________
7.11(g) $__________
7.11(p) $__________
D. Restricted Payments (Section 7.13)
Section Amount
7.13(a) $__________
7.13(c) $__________
Attachment 2
to Exhibit A
The information described herein is as of ___________, ____, and pertains to
the period from _______________, ____ to ________________ __, ____.
I. Fixed Charge Coverage Ratio
A. Fixed Charge Coverage Ratio (Section 7.24)
1. Calculation of EBITDA:
a. Adjusted Net Earnings From Operations
(i) consolidated net income after provision
for income taxes for such fiscal period $__________
Less, to the extent included in net income
(ii) gain or loss arising from the sale
of any capital assets $__________
(iii) gain arising from any write-up
in the book value of any asset $__________
(iv) earnings of any Person (other
than a Subsidiary) in which
any Borrower has an ownership interest
unless (and only to the extent) such
earnings or loss shall actually have
been received by such Borrower
in the form of cash distributions $__________
(v) earnings or loss of any Person to
which assets of any Borrower shall
have been sold, transferred or
disposed of, or into which any Borrower
shall have been merged, or which has
been a party with any Borrower
to any consolidation or other form
of reorganization, prior to
the date of such transaction $__________
(vi) gain or loss arising from the
acquisition of debt or equity
securities of the Parent and the
Borrowers or from cancellation
or forgiveness of Debt $__________
(vii) gain or loss arising from extraordinary
items, as determined in accordance
with GAAP, or from any other
non-recurring transaction, to the
extent included in net income $__________
(viii) Adjusted Net Earning from
Operations $__________
plus (to the extent
deducted in the calculation thereof) $__________
b. amortization $__________
c. depreciation $__________
d. Interest Expense $__________
e. income tax expense $__________
EBITDA $
==========
2. Capital Expenditures (financed) $__________
3. A.1 less A.2 $
4. Fixed Charges
a. Interest Expense $__________
b. Scheduled principal payments of Debt $__________
c. Restricted Payments $__________
d Income taxes (non-deferred) $__________
FIXED CHARGES $
==========
5. Ratio of line 3 to line 4 _____:1
Minimum Required Ratio: 1.10:1*
* 1.00 to 1.00 if calculated for any month prior to February 1, 2004
EXHIBIT B
FORM OF BORROWING BASE CERTIFICATE
This Certificate is delivered to you pursuant to Section 5.2(k) of the
Second Amended and Restated Credit Agreement dated as of November 14, 2003 (as
amended, supplemented or modified from time to time, (the "Credit Agreement"),
among AnnTaylor, Inc. ("ATI"), ANNCO, Inc., AnnTaylor Distribution Services,
Inc., AnnTaylor Retail, Inc (collectively, the "Borrowers"), Bank of America,
N.A. ("Bank of America"), as Administrative Agent for the Lenders (in such
capacity, (the "Agent") , JPMorgan Chase Bank and Wachovia Bank, National
Association, as Syndication Agents, Fleet Retail Group and The CIT
Group/Business Credit, Inc., as Documentation Agents. Terms defined in the
Credit Agreement and not otherwise defined herein are used herein with the
meanings so defined.
The undersigned, _________________, a ___________________ (a
Responsible Officer of ATI) does hereby certify that, as of the date hereof,
the Borrowing Base, as set forth on Schedule A hereto, is $___________________
and no Default or Event of Default has occurred and is continuing.
Each Borrower hereby certifies, and represents and warrants, that this
Borrowing Base Certificate and the attached Schedule A are true, correct and
complete in all material respects and that the amounts set forth in such
Schedule are in compliance in all material respects with the provisions of the
Credit Agreement. Each Borrower acknowledges that the Agent and Lenders are
relying upon the information contained herein and therein in making the Loans.
IN WITNESS WHEREOF, the undersigned has caused this Borrowing Base
Certificate to be executed and delivered as of this ____ day of _____________,
20__.
ANNTAYLOR, INC.
By: ____________________________
Name:___________________________
Title:__________________________
Schedule A
To Exhibit B
ANNTAYLOR, INC.
BORROWING BASE CALCULATION
as of _____________ ____, ____
TOTALS
A. Eligible Accounts: $___________
(See Annex A attached hereto for a
detailed calculation of such amount)
1. multiplied by advance rate of 85% $___________
B. Eligible Inventory Amount:
(See Annex B attached hereto for a detailed calculation
of such amount)
1. Applicable Value of all Eligible Inventory $___________
2. B.1. multiplied by advance rate of 80% $___________
3. Appraised Value of Eligible Inventory $___________
4. B.3. multiplied by advance rate of 85% $___________
5. Lesser of B.2. and B.4. $___________
C. In-Transit Inventory Amount:
(See Annex C attached hereto for a detailed calculation
of such amount)
1. Applicable Value of all In-Transit Inventory $___________
2. C.1. multiplied by advance rate of 60% $___________
3. Appraised Value of In-Transit Inventory $___________
4. C.3. multiplied by advance rate of 75% $___________
5. Lesser of C.2. and C.4. $___________
D. Eligible Fixed Asset Amount:
1. Appraised Value of Eligible Fixed Assets $___________
2. D.1. multiplied by advance rate of 50% $___________
3. Lesser of D.2. and $15,000,000 $___________
TOTAL BORROWING BASE BEFORE RESERVES: $
==========
EXHIBIT C
FINANCIAL STATEMENTS
EXHIBIT D
NOTICE OF BORROWING
Date: ______________, 200_
To: Bank of America, N.A. as Agent for the Lenders who are parties to the
Second Amended and Restated Credit Agreement dated as of ___________,
2003 (as extended, renewed, amended or restated from time to time, the
"Credit Agreement") by and among AnnTaylor, Inc., ANNCO, Inc.,
AnnTaylor Distribution Services, Inc., AnnTaylor Retail, Inc., the
Lenders party thereto and Bank of America, N.A., as Agent, JPMorgan
Chase Bank and Wachovia Bank, National Association, as Syndication
Agents, Fleet Retail Group and The CIT Group/Business Credit, Inc., as
Documentation Agents.
Ladies and Gentlemen:
The undersigned, ________________________ (the "Borrower"), refers to
the Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably of the Borrowing specified
below:
1. The Business Day of the proposed Borrowing is _______________,
200__.
2. The aggregate amount of the proposed Borrowing is
$_______________.
3. The Borrowing is to be comprised of $_______________ of Base
Rate and $_______________ of LIBOR Loans.
4. The duration of the Interest Period for the LIBOR Loans, if any,
included in the Borrowing shall be _____ months.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the proposed
Borrowing, before and after giving effect thereto and to the application of the
proceeds therefrom:
(a) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are correct in all material
respects on and as of the date of the Credit Extension requested hereunder
and are deemed made on and as of the date hereof, other than any such
representation or warranty which relates to a specified prior date and
except to the extent the Agent and the Lenders have been notified in
writing by any Borrower that any representation or warranty is not correct
and the Required Lenders have explicitly waived in writing compliance with
such representation or warranty; and
(b) No event has occurred and is continuing, or would result from the
Credit Extension requested hereby, which constitutes a Default or an Event
of Default; and
(c) No event has occurred and is continuing, or would result from such
Credit Extension requested hereby, which has had or would have a Material
Adverse Effect.
(d) The proposed Borrowing will not cause the aggregate principal
amount of all outstanding Revolving Loans plus all Letter of Credit
Outstandings, to exceed the Borrowing Base or the combined Commitments of
the Lenders.
__________________________________
By:_______________________________
Title: ___________________________
EXHIBIT E
NOTICE OF CONTINUATION/CONVERSION
Date: _______________, 200__
To: Bank of America, N.A. as Agent for the Lenders to the Second Amended
and Restated Credit Agreement dated as of _______________, 2003 (as
extended, renewed, amended or restated from time to time, the "Credit
Agreement") among AnnTaylor, Inc., ANNCO, Inc., AnnTaylor Distribution
Services, Inc., AnnTaylor Retail, Inc., the Lenders party thereto and
Bank of America, N.A., as Agent, JPMorgan Chase Bank and Wachovia Bank,
National Association, as Syndication Agents, Fleet Retail Group and The
CIT Group/Business Credit, Inc., as Documentation Agents.
Ladies and Gentlemen:
The undersigned, _______________________ (the "Borrower"), refers to
the Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably of the [conversion]
[continuation] of the Loans specified herein, that:
1. The Continuation/Conversion Date is _______________, 200__.
2. The aggregate amount of the Loans to be [converted] [continued]
is $_______________.
3. The Loans are to be [converted into] [continued as] [LIBOR Rate]
[Base Rate] Loans.
4. The duration of the Interest Period for the LIBOR Loans included
in the [conversion] [continuation] shall be _____ months.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the proposed
Continuation/Conversion Date, before and after giving effect thereto and to the
application of the proceeds therefrom:
(a) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are correct in all material
respects on and as of the date of the [continuation][conversion] requested
hereunder and are deemed made on and as of the date hereof, other than any
such representation or warranty which relates to a specified prior date
and except to the extent the Agent and the Lenders have been notified in
writing by any Borrower that any representation or warranty is not correct
and the Required Lenders have explicitly waived in writing compliance with
such representation or warranty; and
(b) No event has occurred and is continuing, or would result from the
[continuation][conversion] requested hereby, which constitutes a Default
or an Event of Default; and
(c) No event has occurred and is continuing, or would result from such
[continuation][conversion] requested hereby, which has had or would have a
Material Adverse Effect.
(d) The proposed [continuation][conversion] will not cause the
aggregate principal amount of all outstanding Revolving Loans plus all
Letter of Credit Outstandings, to exceed the Borrowing Base or the
combined Commitments of the Lenders.
_______________________________
By: ___________________________
Title:_________________________
EXHIBIT F
[FORM OF] ASSIGNMENT AND ACCEPTANCE AGREEMENT
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of ____________________, 200_ is made between
______________________________ (the "Assignor") and __________________________
(the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Second Amended and
Restated Credit Agreement dated as of _____________, 2003 (as amended, amended
and restated, modified, supplemented or renewed, the "Credit Agreement") among
AnnTaylor, Inc., ANNCO, Inc., AnnTaylor Distribution Services, Inc., AnnTaylor
Retail, Inc., the Lenders party thereto and Bank of America, N. A., as agent
for the Lenders (the "Agent"), JPMorgan Chase Bank and Wachovia Bank, National
Association, as Syndication Agents, Fleet Retail Group and The CIT
Group/Business Credit, Inc., as Documentation Agents. Any terms defined in the
Credit Agreement and not defined in this Assignment and Acceptance are used
herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to making Loans (the "Committed Loans") to the Borrowers in an
aggregate amount not to exceed $__________ (the "Commitment");
WHEREAS, the Assignor has made Committed Loans in the aggregate
principal amount of $__________ to the Borrowers;
WHEREAS, [the Assignor has acquired a participation in its pro rata
share of the Lenders' liabilities under Letters of Credit in an aggregate
principal amount of $____________ (the "L/C Obligations")] [no Letters of
Credit are outstanding under the Credit Agreement]; and
WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all] rights and obligations of the Assignor under the Credit Agreement in
respect of its Commitment, together with a corresponding portion of each of its
outstanding Committed Loans and L/C Obligations, in an amount equal to
$__________ (the "Assigned Amount") on the terms and subject to the conditions
set forth herein and the Assignee wishes to accept assignment of such rights
and to assume such obligations from the Assignor on such terms and subject to
such conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
1. Assignment and Acceptance.
(a) Subject to the terms and conditions of this Assignment
and Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from
the Assignor, without recourse and without representation or warranty (except
as provided in this Assignment and Acceptance) __% (the "Assignee's Percentage
Share") of (A) the Commitment, the Committed Loans and the L/C Obligations of
the Assignor and (B) all related rights, benefits, obligations, liabilities
and indemnities of the Assignor under and in connection with the Credit
Agreement and the Loan Documents.
(b) With effect on and after the Effective Date (as defined
in Section 5 hereof), the Assignee shall be a party to the Credit Agreement
and succeed to all of the rights and be obligated to perform all of the
obligations of a Lender under the Credit Agreement, including the requirements
concerning confidentiality and the payment of indemnification, with a
Commitment in an amount equal to the Assigned Amount. The Assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a
Lender. It is the intent of the parties hereto that the Commitment of the
Assignor shall, as of the Effective Date, be reduced by an amount equal to the
Assigned Amount and the Assignor shall relinquish its rights and be released
from its obligations under the Credit Agreement to the extent such obligations
have been assumed by the Assignee; provided, however, the Assignor shall not
relinquish its rights under Sections __ and __ of the Credit Agreement to the
extent such rights relate to the time prior to the Effective Date.
(c) After giving effect to the assignment and assumption set
forth herein, on the Effective Date the Assignee's Commitment will be
$__________.
(d) After giving effect to the assignment and assumption set
forth herein, on the Effective Date the Assignor's Commitment will be
$__________.
2. Payments.
(a) As consideration for the sale, assignment and transfer
contemplated in Section 1 hereof, the Assignee shall pay to the Assignor on
the Effective Date in immediately available funds an amount equal to
$__________, representing the Assignee's Pro Rata Share of the principal
amount of all Committed Loans.
(b) The Assignee further agrees to pay to the Agent a
processing fee in the amount specified in Section 11.2(a) of the Credit
Agreement.
3. Reallocation of Payments.
Any interest, fees and other payments accrued to the
Effective Date with respect to the Commitment, and Committed Loans and L/C
Obligations shall be for the account of the Assignor. Any interest, fees and
other payments accrued on and after the Effective Date with respect to the
Assigned Amount shall be for the account of the Assignee. Each of the Assignor
and the Assignee agrees that it will hold in trust for the other party any
interest, fees and other amounts which it may receive to which the other party
is entitled pursuant to the preceding sentence and pay to the other party any
such amounts which it may receive promptly upon receipt.
4. Independent Credit Decision.
The Assignee (a) acknowledges that it has received a copy of
the Credit Agreement and the Schedules and Exhibits thereto, together with
copies of the most recent financial statements of the Borrowers, and such
other documents and information as it has deemed appropriate to make its own
credit and legal analysis and decision to enter into this Assignment and
Acceptance; and (b) agrees that it will, independently and without reliance
upon the Assignor, the Agent or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit and legal decisions in taking or not taking action under the Credit
Agreement.
5. Effective Date; Notices.
(a) As between the Assignor and the Assignee, the effective
date for this Assignment and Acceptance shall be __________, 200_ (the
"Effective Date"); provided that the following conditions precedent have been
satisfied on or before the Effective Date:
(i) this Assignment and Acceptance shall be
executed and delivered by the Assignor and the Assignee;
[(ii) the consent of the Agent required for an
effective assignment of the Assigned Amount by the Assignor to the
Assignee shall have been duly obtained and shall be in full force and
effect as of the Effective Date;]
(iii) the Assignee shall pay to the Assignor all
amounts due to the Assignor under this Assignment and Acceptance;
[(iv) the Assignee shall have complied with Section
11.2 of the Credit Agreement (if applicable);]
(v) the processing fee referred to in Section 2(b)
hereof and in Section 11.2(a) of the Credit Agreement shall have been
paid to the Agent; and
(b) Promptly following the execution of this Assignment and
Acceptance, the Assignor shall deliver to the Borrowers and the Agent for
acknowledgment by the Agent, a Notice of Assignment in the form attached
hereto as Schedule 1.
6. [Agent. [INCLUDE ONLY IF ASSIGNOR IS AGENT]
(a) The Assignee hereby appoints and authorizes the Assignor
to take such action as agent on its behalf and to exercise such powers under
the Credit Agreement as are delegated to the Agent by the Lenders pursuant to
the terms of the Credit Agreement.
(b) The Assignee shall assume no duties or obligations held
by the Assignor in its capacity as Agent under the Credit Agreement.]
7. Withholding Tax.
The Assignee (a) represents and warrants to the Lender, the
Agent and the Borrowers that under applicable law and treaties no tax will be
required to be withheld by any Borrower and/or the Agent [and/or any Lender],
as applicable with respect to any payments to be made to the Assignee
hereunder, (b) agrees to furnish (if it is organized under the laws of any
jurisdiction other than the United States or any State thereof) to the Agent
and the Borrowers prior to the time that the Agent or Borrower is required to
make any payment of principal, interest or fees hereunder, duplicate executed
originals of either U.S. Internal Revenue Service Form W-8ECI or U.S. Internal
Revenue Service Form W-8BEN (wherein the Assignee claims entitlement to the
benefits of a tax treaty that provides for a complete exemption from U.S.
federal income withholding tax on all payments hereunder) and agrees to
provide new Forms W-8ECI or W-8BEN upon the expiration of any previously
delivered form or comparable statements in accordance with applicable U.S. law
and regulations and amendments thereto, duly executed and completed by the
Assignee, and (c) agrees to comply with all applicable U.S. laws and
regulations with regard to such withholding tax exemption.
8. Representations and Warranties.
(a) The Assignor represents and warrants that (i) 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 or other adverse claim; (ii)
it is duly organized and existing and it has the full power and authority to
take, and has taken, all action necessary to execute and deliver this
Assignment and Acceptance and any other documents required or permitted to be
executed or delivered by it in connection with this Assignment and Acceptance
and to fulfill its obligations hereunder; (iii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than any
already given or obtained) for its due execution, delivery and performance of
this Assignment and Acceptance, and apart from any agreements or undertakings
or filings required by the Credit Agreement, no further action by, or notice
to, or filing with, any Person is required of it for such execution, delivery
or performance; and (iv) this Assignment and Acceptance has been duly executed
and delivered by it and constitutes the legal, valid and binding obligation of
the Assignor, enforceable against the Assignor in accordance with the terms
hereof, subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles.
(b) The Assignor 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 Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other instrument or document furnished
pursuant thereto. The Assignor makes no representation or warranty in
connection with, and assumes no responsibility with respect to, the solvency,
financial condition or statements of any Borrower, or the performance or
observance by any Borrower, of any of its respective obligations under the
Credit Agreement or any other instrument or document furnished in connection
therewith.
(c) The Assignee represents and warrants that (i) it is duly
organized and existing and it has full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance, and to
fulfill its obligations hereunder; (ii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than any
already given or obtained) for its due execution, delivery and performance of
this Assignment and Acceptance; and apart from any agreements or undertakings
or filings required by the Credit Agreement, no further action by, or notice
to, or filing with, any Person is required of it for such execution, delivery
or performance; (iii) this Assignment and Acceptance has been duly executed
and delivered by it and constitutes the legal, valid and binding obligation of
the Assignee, enforceable against the Assignee in accordance with the terms
hereof, subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles; [and (iv) it is an
Eligible Assignee.]
9. Further Assurances.
The Assignor and the Assignee each hereby agree to execute
and deliver such other instruments, and take such other action, as either
party may reasonably request in connection with the transactions contemplated
by this Assignment and Acceptance, including the delivery of any notices or
other documents or instruments to the Borrowers or the Agent, which may be
required in connection with the assignment and assumption contemplated hereby.
10. Miscellaneous.
(a) Any amendment or waiver of any provision of this
Assignment and Acceptance shall be in writing and signed by the parties
hereto. No failure or delay by either party hereto in exercising any right,
power or privilege hereunder shall operate as a waiver thereof and any waiver
of any breach of the provisions of this Assignment and Acceptance shall be
without prejudice to any rights with respect to any other or further breach
thereof.
(b) All payments made hereunder shall be made without any
set-off or counterclaim.
(c) The Assignor and the Assignee shall each pay its own
costs and expenses incurred in connection with the negotiation, preparation,
execution and performance of this Assignment and Acceptance.
(d) This Assignment and Acceptance may be executed in any
number of counterparts and all of such counterparts taken together shall be
deemed to constitute one and the same instrument.
(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF _______________. The
Assignor and the Assignee each irrevocably submits to the non-exclusive
jurisdiction of any State or Federal court sitting in [_______________] over
any suit, action or proceeding arising out of or relating to this Assignment
and Acceptance and irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such [_______________]
State or Federal court. Each party to this Assignment and Acceptance hereby
irrevocably waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding.
(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR
IN CONNECTION WITH THIS ASSIGNMENT AND ACCEPTANCE, THE CREDIT AGREEMENT, ANY
RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
OR STATEMENTS (WHETHER ORAL OR WRITTEN).
IN WITNESS WHEREOF, the Assignor and the Assignee have
caused this Assignment and Acceptance to be executed and delivered by their
duly authorized officers as of the date first above written.
[ASSIGNOR]
By: _____________________________
Title: __________________________
Address: ________________________
[ASSIGNEE]
By: _____________________________
Title: __________________________
Address:_________________________
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
NOTICE OF ASSIGNMENT AND ACCEPTANCE
_______________, 200_
Bank of America, N.A.
________________________
________________________
________________________
Attention: Business Credit-Account Executive
AnnTaylor, Inc.
_____________________
_____________________
_____________________
Re: AnnTaylor, Inc.
Ladies and Gentlemen:
We refer to the Second Amended and Restated Credit Agreement dated as
of _________, 2003 (as amended, amended and restated, modified, supplemented or
renewed from time to time the "Credit Agreement") among AnnTaylor, Inc., ANNCO,
Inc., AnnTaylor Distribution Services, Inc., AnnTaylor Retail, Inc., the
Lenders party thereto and Bank of America, N. A., as agent for the Lenders (the
"Agent"), JPMorgan Chase Bank and Wachovia Bank, National Association, as
Syndication Agents, Fleet Retail Group and The CIT Group/Business Credit, Inc.,
as Documentation Agents. Terms defined in the Credit Agreement are used herein
as therein defined.
1. We hereby give you notice of, and request your consent to, the
assignment by __________________ (the "Assignor") to _______________ (the
"Assignee") of _____% of the right, title and interest of the Assignor in and
to the Credit Agreement (including the right, title and interest of the
Assignor in and to the Commitments of the Assignor, all outstanding Loans made
by the Assignor and the Assignor's participation in the Letters of Credit
pursuant to the Assignment and Acceptance Agreement attached hereto (the
"Assignment and Acceptance"). We understand and agree that the Assignor's
Commitment, as of _______________, 200__, is $___________, the aggregate amount
of its outstanding Loans is $_____________, and its participation in L/C
Obligations is $_____________.
2. The Assignee agrees that, upon receiving the consent of the Agent
to such assignment, the Assignee will be bound by the terms of the Credit
Agreement as fully and to the same extent as if the Assignee were the Lender
originally holding such interest in the Credit Agreement.
3. The following administrative details apply to the Assignee:
(A) Notice Address:
Assignee name:_____________________
Address: __________________________
__________________________
__________________________
Attention: ________________________
Telephone: (___)__________________
Telecopier: (___)_________________
Telex (Answerback):________________
(B) Payment Instructions:
Account No.:______________________
At:______________________
______________________
______________________
Reference: ______________________
Attention: ______________________
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
[NAME OF ASSIGNOR]
By:_____________________________
Title:__________________________
[NAME OF ASSIGNEE]
By: ___________________________
Title: ________________________
ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:
Bank of America, N. A.
as Agent
By: ___________________________
Title:_________________________
SCHEDULE 1.1
COMMITMENTS
Revolving Loan Pro Rata Share
Lender Commitment (3 decimals)
Bank of America, N.A. $___,000,000 $___.000%
--------------- -------------
$175,000,000 100%
SCHEDULE 1.2
EXISTING LETTERS OF CREDIT