EXECUTION COPY
EXHIBIT 4.47
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GENCOR INDUSTRIES, INC.
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$33,258,140.84
AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT
Dated as of December 31, 2001
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CREDIT LYONNAIS NEW YORK BRANCH,
as Agent
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AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT, dated as
of December 31, 2001, among GENCOR INDUSTRIES, INC., a Delaware corporation (the
"Borrower"), the several banks and other financial institutions from time to
time parties to this Agreement (collectively, the "Lenders"), CREDIT LYONNAIS
NEW YORK BRANCH, as Issuing Bank with respect to Letters of Credit, and CREDIT
LYONNAIS NEW YORK BRANCH, as agent for the Lenders and the Issuing Bank
hereunder (the "Agent").
WHEREAS, the Borrower is a party to a certain Senior Secured
Credit Agreement, dated as of December 10, 1996, by and among the Borrower, the
Lenders and the Agent, as amended from time to time (the "Original Credit
Agreement");
WHEREAS, the Borrower and certain of its affiliates are
operating their businesses as debtors-in-possession under Sections 1107 and 1108
of the Bankruptcy Code;
WHEREAS, pursuant to Section 1121 of the Bankruptcy Code, the
Borrower filed its Fourth Amended Plan of Reorganization with the Bankruptcy
Court on December 14, 2001, which plan, as modified, was confirmed by order of
the Bankruptcy Court, dated December 18, 2001 (the "Plan of Reorganization");
WHEREAS, pursuant to the terms of the Plan of Reorganization,
the Lenders and the Agent are holders of an Allowed Claim in the aggregate
principal amount of $33,258,140.84, which claim reflects the pre-petition
obligations outstanding to the Agent and the Lenders under the Original Credit
Agreement; and
WHEREAS, the parties hereto wish to amend and restate the
Original Credit Agreement to reflect the rights and obligations of the parties
hereto with respect to the Allowed Claim.
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms shall
have the following meanings:
"Account": has the meaning given to that term in Section 9-102
of the Uniform Commercial Code of the State of New York.
"Account Debtor": the party who is obligated on an Account.
"Active Subsidiary": shall include each direct or indirect
Subsidiary of the Borrower, other than Troubled Subsidiaries, existing
on or after the date hereof, including, without limitation, Bituma
Corporation; Bituma-Stor Inc.; Equipment Services Group Inc.; Gencor
International Ltd. f/k/a Gencor Industries Ltd.; General Combustion
Corporation; and General Combustion Limited (UK).
"Additional Interest": as defined in subsection 3.2(c).
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"Additional Interest Rate": as defined in subsection 3.2(a).
"Adjusted Capital Expenditures": with respect to any Person
for any period, the sum of (i) all expenditures of such Person in
respect of the purchase or other acquisition of fixed or capital assets
(excluding any such asset acquired in connection with normal
replacement and maintenance programs properly charged to current
operations) that are paid or due and payable in cash during such period
and (ii) all Financing Lease expenses of such Person that are paid or
(without duplication) due and payable in cash during such period.
"Affiliate": as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, either
to (a) vote 10% or more of the securities having ordinary voting power
for the election of directors of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by
contract or otherwise.
"Agent": Credit Lyonnais New York Branch, as the agent for the
Lenders and for the Issuing Bank under this Agreement and the other
Loan Documents or its successor appointed pursuant to subsection 9.9.
"Agreement": this Amended and Restated Senior Secured Credit
Agreement, as amended, supplemented or otherwise modified from time to
time.
"Allowed Claim": the Lenders' and the Agent's Class 2 allowed
claim under the Plan of Reorganization, the repayment of which is
evidenced by the Term Loans and the Letter of Credit Loans pursuant to
this Agreement.
"Asset Sale": as defined in clause (a) of the definition of
Covered Sale.
"Assignee": as defined in subsection 10.6(c).
"Bankruptcy Code": title 11, United States Code, as amended
from time to time, together with all rules, regulations and
interpretations thereunder.
"Bankruptcy Court": United States Bankruptcy Court for the
Middle District of Florida, Orlando Division.
"Base Rate": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the Prime Rate in effect
on such day plus 2%. For purposes hereof: "Prime Rate" shall mean the
rate of interest per annum publicly announced from time to time by
Credit Lyonnais New York Branch as its prime rate in effect at its
principal office in New York City (the Prime Rate is not intended to be
the lowest rate of interest charged by Credit Lyonnais in connection
with extensions of credit to debtors). Any change in the
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Base Rate due to a change in the Prime Rate shall be effective as of
the opening of business on the effective day of such change in the
Prime Rate.
"Billingshurst Facility": as defined in subsection 3.1(b).
"Board of Governors": the Board of Governors of the Federal
Reserve System or any successor to the functions and powers thereof.
"Borrower Pledge Agreement": the Amended and Restated Pledge
Agreement to be executed and delivered by the Borrower, substantially
in the form of Exhibit B, which is substantially in the form previously
executed by the Borrower, as the same may be amended, supplemented or
otherwise modified from time to time.
"Borrower Security Agreement": collectively, the Amended and
Restated Security Agreement to be executed and delivered by the
Borrower, substantially in the form of Exhibit A-1, which is
substantially in the form previously executed by the Borrower as
modified to reflect revisions to the Uniform Commercial Code, as the
same may be amended, supplemented or otherwise modified from time to
time, and the Amended and Restated Trademark Security Agreement, the
Amended and Restated Patent Collateral Assignment and the Amended and
Restated Copyright Security Agreement to be executed and delivered by
the Borrower, substantially in the forms of Exhibits A-2(a), A-2(b) and
A-2(c), which are substantially in the forms previously executed by the
Borrower, as any of the same may be amended, supplemented or otherwise
modified from time to time.
"Borrower Security Documents": the collective reference to the
Borrower Security Agreement and the Borrower Pledge Agreement.
"Business": as defined in subsection 4.14.
"Business Day": a day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or
required by law to close.
"Capital Stock": any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person
(other than a corporation) and any and all warrants or options to
purchase any of the foregoing.
"Cash Equivalents": (i) securities issued or directly and
fully guaranteed or insured by the United States Government or any
agency or instrumentality thereof having maturities of not more than
one year from the date of acquisition, (ii) time deposits and
certificates of deposit having maturities of not more than 180 days
from the date of acquisition of any Lender or of any domestic
commercial bank the long-term debt of which is rated at the date of
acquisition thereof at least A or the equivalent thereof by Standard &
Poor's Ratings Group
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or A-2 or the equivalent thereof by Moody's Investors Service, Inc. and
having capital and surplus in excess of $500,000,000, (iii) repurchase
obligations with a term of not more than seven days for underlying
securities of the types described in clauses (i) and (ii) entered into
with any bank meeting the qualifications specified in clause (ii) above
and (iv) commercial paper rated at the date of acquisition thereof at
least A-2 or the equivalent thereof by Standard & Poor's Ratings Group
or P-2 or the equivalent thereof by Moody's Investors Service, Inc. and
in either case maturing within 180 days after the date of acquisition.
"Casualty Loss": with respect to any asset owned or used by
the Borrower or any of its Subsidiaries: (a) any damage to or loss or
destruction of such asset; or (b) any actual condemnation or taking, by
exercise of the power of eminent domain or otherwise.
"CERCLA": the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended
from time to time, 42 U.S.C.ss. 9601 et seq.
"Change of Control": shall occur if (a) at any time neither
E.J. Elliott nor John E. Elliott shall serve as a Responsible Officer
and a director of the Borrower; provided, however, that, so long as
John E. Elliott serves as a Responsible Officer and a director of the
Borrower, E.J. Elliott's failure to serve as a Responsible Officer and
a director of the Borrower due to his death, permanent disability or
retirement shall not be deemed to be a Change of Control, or (b) at any
time E.J. Elliott, John E. Elliott and members of their immediate
family collectively shall own less than fifty percent (50%) of the
Voting Stock of the Borrower owned by them on the Closing Date
(assuming for such purpose that all Class B Stock held by them on the
date hereof has been converted into Common Stock) or (c) at any time
E.J. Elliott, John E. Elliott and members of their immediate family
collectively shall cease to own such number of shares of the Class B
Stock of the Borrower as is necessary for such Persons to elect not
less than 75% of the whole Board of Directors.
"Chapter 11 Cases": the Chapter 11 cases of the Borrower and
its Subsidiaries under the Bankruptcy Code referred to as In re Gencor
Industries, Inc., et al., in the Bankruptcy Court.
"Closing Date": the date on which the conditions precedent set
forth in subsection 5.1 shall be satisfied.
"Code": the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral": all assets of the Loan Parties, whether now
owned or hereafter acquired, upon which a Lien is purported to be
created by any Security Document.
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"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Borrower within
the meaning of Section 4001 of ERISA or is part of a group which
includes the Borrower and which is treated as a single employer under
Section 414 of the Code.
"Confirmation Order": the order confirming the Plan of
Reorganization, dated July 20, 2001, as modified by the Order Granting
Debtor's Motion for Order Modifying Confirmed Plan of Reorganization
and Confirming Fourth Amended Plan of Reorganization, entered by the
Bankruptcy Court on December 18, 2001, in the Chapter 11 Cases.
"Covered Sale": as to the Borrower or any of its Subsidiaries,
subject to the provisions of Section 7, any (a) sale or other
disposition (including any sale and leaseback of assets, and any
mortgage or lease of real property) (other than a Permitted Asset Sale)
subsequent to the Closing Date of any property of the Borrower or any
of its Subsidiaries (an "Asset Sale"), (b) issuance of equity or debt
securities of the Borrower or any of its Subsidiaries subsequent to the
Closing Date (other than (i) issuances of its own equity securities by
the Borrower pursuant to any stock option plan maintained by the
Borrower for the purchase of up to 20% of the outstanding Voting Stock
of the Borrower, (ii) issuances of equity securities by any Subsidiary
of the Borrower to the Borrower, (iii) issuances of debt securities by
any Subsidiary of the Borrower in favor of the Borrower, and (iv)
increases in the aggregate amount of Indebtedness that may be incurred
under this Agreement), or (c) the receipt of any other proceeds by the
Borrower or any of its Subsidiaries from lawsuits arising outside the
ordinary course of business, including but not limited to, the
litigation brought against Glenn Dalby and any action brought against
Deloitte & Touche.
"CPM Bankruptcy": the bankruptcy proceedings currently pending
in the United States Bankruptcy Court, Middle District of Florida,
Orlando Division, Case No. 00-03603-6J1, with respect to Consolidated
Process Machinery, Inc., and its United States Subsidiaries.
"Default": any of the events specified in Section 8, whether
or not any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.
"Deferred Principal Payment": as defined in subsection 2.2(c).
"Disclosure Statement": the disclosure statement filed by the
Borrower and its Subsidiaries in the Chapter 11 Cases pursuant to
Section 1125 of the Bankruptcy Code describing the Plan of
Reorganization.
"Disputed Letter of Credit": that certain Irrevocable Standby
Letter of Credit, Number 970401IS840, issued on April 2, 1997, by
Credit Lyonnais New York Branch on behalf of Silver Weibull for the
benefit of SE Banken.
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"Dollars" and "$": dollars in lawful currency of the United
States of America.
"Domestic and Foreign Bank Accounts": as defined in subsection
4.22.
"Domestic Subsidiary": any Subsidiary of the Borrower that is
incorporated in any state or other jurisdiction of the United States of
America.
"Drawn Letters of Credit": that portion of the Unexpired
Letters of Credit that have been presented to the appropriate issuing
bank and have been paid by such issuing bank.
"EBITDA": with respect to the Borrower and its Active
Subsidiaries, for any period, the sum of (a) the consolidated net
income of the Borrower and its Active Subsidiaries for such period plus
(b) to the extent deducted in computing such consolidated net income,
the sum of (i) income tax expense, (ii) interest expense, (iii)
depreciation and amortization expense, (iv) extraordinary losses and
(v) any non-cash loss, and minus to the extent added in computing such
consolidated net income, (i) any interest income, (ii) any
extraordinary gains and (iii) any non-cash gain, all as determined on a
consolidated basis with respect to the Borrower and its Active
Subsidiaries in accordance with GAAP.
"Effective Date": December 31, 2001 provided that the
conditions precedent set forth in subsection 5.1 shall be satisfied.
"Environmental Claims": any and all administrative, regulatory
or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit
issued, or any approval given, under any such Environmental Law
(hereafter, "Claims"), including, without limitation, (a) any and all
Claims by governmental or regulatory authorities for enforcement,
cleanup, removal, response, remedial or other actions or damages
pursuant to any applicable Environmental Law, (b) any and all Claims by
any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief in connection with alleged
injury or threat of injury to health, safety or the environment due to
the presence of Materials of Environmental Concern, (c) any fact,
circumstance, condition or occurrence forming the basis of any
violation, or alleged violation, of any Environmental Law and (d) any
alleged injury or threat of injury to health, safety or the environment
due to the presence of Materials of Environmental Concern.
"Environmental Laws": any and all foreign, federal, state,
local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes or decrees of any Governmental Authority or other
Requirements of Law (including common law) regulating, relating to or
imposing liability or standards of conduct concerning Materials of
Environmental Concern or protection of human health or the environment,
as now or may at any time hereafter be in effect.
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"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"Event of Default": any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of
time, or both has been satisfied.
"FDIC": the Federal Deposit Insurance Corporation or any
successor to the functions and powers thereof.
"Financing Lease": any lease of property, real or personal,
the obligations of the lessee in respect of which are required in
accordance with GAAP to be capitalized on a balance sheet of the
lessee.
"Foreign Subsidiary": any Subsidiary of the Borrower that is
not a Domestic Subsidiary. A Foreign Subsidiary shall be deemed
wholly-owned by the Borrower if (a) not more than one percent (1%) of
such Foreign Subsidiary's Capital Stock is owned by a third party and
(b) the laws of the jurisdiction in which such Foreign Subsidiary is
incorporated require a corporation to have not less than two
stockholders.
"Foreign Subsidiary Obligations": with respect to any Foreign
Subsidiary the collective reference to the obligations and liabilities
of such Foreign Subsidiary which may arise under, out of or in
connection with any and all obligations and liabilities of such Foreign
Subsidiary under the Loan Documents to which such Foreign Subsidiary is
a party, whether for principal, interest, fees or otherwise, and
whether direct or indirect, absolute or contingent, due or to become
due, or now existing or hereafter incurred (including, without
limitation, interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to such Foreign Subsidiary whether or not a
claim for post-filing or post-petition interest is allowed in such
proceeding).
"GAAP": generally accepted accounting principles in the United
States of America in effect on the Closing Date.
"Governmental Authority": any foreign, federal, state or other
court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another
Person (including, without limitation, any bank under any letter of
credit) to induce the creation of which the guaranteeing person has
issued a reimbursement, counter indemnity or similar obligation, in
either case guaranteeing or in effect guaranteeing any Indebtedness,
leases, dividends or other obligations (the "primary obligations") of
any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation
of the guaranteeing
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person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or
payment of any such primary obligation or (2) to maintain working
capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation or (iv)
otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof, provided, however, that the
term Guarantee Obligation shall not include endorsements of instruments
for deposit or collection in the ordinary course of business; and
provided, further, that the term Guarantee Obligation shall not include
customary and reasonable indemnity obligations of the Borrower and its
Subsidiaries under any agreement or document in existence as of the
Closing Date pursuant to which the Borrower or a Subsidiary thereof may
indemnify a party to any such agreement or document with respect to
losses incurred by such party as a result of the failure of a
representation or warranty of the Borrower or such Subsidiary to be
true or as a result of an event occurring after the effective date of
such agreement or document or acquisition by the Borrower or such
Subsidiary, as the case may be. The amount of any Guarantee Obligation
of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee Obligation is made and
(b) the maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for
which such guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person's maximum reasonably anticipated
liability in respect thereof as determined by the Borrower in good
faith.
"Guarantees": the Subsidiaries' Guarantees.
"Guarantor": any Person executing and delivering a Guarantee
pursuant to this Agreement.
"Indebtedness": of any Person at any date, without
duplication, (a) all indebtedness of such Person for borrowed money or
for the deferred purchase price of property or services (other than
unsecured current liabilities not the result of the borrowing of money
or the obtaining of credit or the leasing of property for accounts
payable and expense accruals incurred or assumed in the ordinary course
of business for current purposes and not represented by a note or other
evidence of indebtedness and payable in accordance with customary
practices), (b) any other indebtedness of such Person which is
evidenced by a note, bond, debenture or similar instrument, (c) all
obligations of such Person under Financing Leases, (d) all obligations
of such Person in respect of acceptances issued or created for the
account of such Person, (e) all liabilities secured by any Lien (other
than
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Permitted Liens) on any property owned by such Person even though such
Person has not assumed or otherwise become liable for the payment
thereof, and (f) all obligations under this Agreement and the other
Loan Documents.
"Insolvency": with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section
4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intercompany Transactional Indebtedness": Indebtedness of
Subsidiaries to the Borrower outstanding as of the date hereof in the
aggregate principal amount of $16,015,110.80 as evidenced by the
promissory notes set forth in Schedule 7.2(e).
"Interest Payment Date": as to any Loan the first day of each
month while the Loan is outstanding; provided, however, if such day is
not a Business Day, such payment date shall be extended to the next
succeeding Business Day.
"IRB Indebtedness": Indebtedness of the Borrower incurred on
December 1, 1984, in the original principal amount of $5,000,000 under
certain industrial revenue bonds issued by the Borrower pursuant to a
loan agreement between the Borrower (formerly Mechtron International
Corporation) and the Orange County Industrial Development Authority
("Authority") dated as of December 1, 1984, secured pursuant to a
Mortgage Deed and Security Agreement made by the Borrower in favor of
the Authority dated December 1, 1984, by a first priority lien on the
real property and personal property identified on Exhibits A and B to
said loan agreement and guaranteed by Subsidiaries of the Borrower
pursuant to a Guarantee Agreement dated December 1, 1984 (such
agreements being referred to herein as the "IRB Documents").
"Leasehold Mortgage": each Amended and Restated Leasehold
Mortgage to be executed and delivered by the Borrower or a Subsidiary,
as applicable, substantially in the form previously executed by a
Subsidiary and covering the leased property listed on Schedule III for
which the Agent requests an Amended and Restated Leasehold Mortgage as
indicated on such schedule, subject to the receipt of all required
consents, including landlord waivers, and any leases of real property
acquired by the Borrower or any Subsidiary of the Borrower pursuant to
any subsequent acquisition for which the Agent requests a Leasehold
Mortgage, in each case as the same may be amended, supplemented or
otherwise modified from time to time.
"Lenders": as defined in the first paragraph of this
Agreement.
"Letter of Credit Cash Collateral': as defined in subsection
2.2.
"Letter of Credit Lender": each of the following Lenders that
was a Revolving Credit Lender under the Original Credit Agreement:
Credit Lyonnais
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New York Branch; PB Capital Corporation f/k/a BHF (USA)
Capital Corporation; Bank Austria Creditanstalt Corporate Finance,
Inc.; Skandinaviska Enskilda Banken Corporation; ABN AMRO Bank N.V.;
and Suntrust Bank.
"Letter of Credit Loan": as defined in subsection 2.1.
"Letter of Credit Note": as defined in subsection 2.3(d).
"Letters of Credit": collectively, the Disputed Letter of
Credit, the Unexpired Letters of Credit and the Drawn Letters of
Credit.
"Lien": with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on
such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement
relating to such asset and (c) in addition, in the case of securities,
any purchase option, call or similar right of a third party with
respect to such securities.
"Loan(s)": any Term Loan and/or Letter of Credit Loan
outstanding to any Lender pursuant to this Agreement.
"Loan Documents": this Agreement, the Notes, the Guarantees
and the Security Documents.
"Loan Parties": the Borrower, and each Subsidiary of the
Borrower which is a party to a Loan Document.
"Loan Percentage": as to any Lender at any time, the
percentage which (i) such Lender's Loans then outstanding then
constitutes of (ii) the aggregate principal amount of Loans of all the
Lenders then outstanding.
"Material Adverse Effect": a material adverse effect on (a)
the business, operations, assets, liabilities, property, performance or
condition (financial or otherwise) or prospects of the Borrower or any
of its Subsidiaries or (b) the enforceability of this Agreement, any
Note or any of the other Loan Documents or the rights or remedies of
the Agent or the Lenders hereunder or thereunder.
"Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum
products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Law,
including, without limitation, asbestos, polychlorinated biphenyls,
urea-formaldehyde insulation, lead-based paint, radiation, radioactive
materials and electromagnetic fields.
"Maturity Date": September 6, 2005.
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"Midwest Employers Casualty Letter of Credit": that certain
Irrevocable Standby Letter of Credit, Number 970910IS096, in the amount
of $640,000, which amount has been fully drawn, issued by Credit
Lyonnais New York Branch on behalf of the Borrower for the benefit of
Midwest Employers Casualty Co.
"Mortgage": each Mortgage or Deed of Trust previously executed
and delivered by the Borrower or a Subsidiary, as amended, such
amendments substantially in the forms of Exhibit C-1 and Exhibit C-2,
and each other mortgage or deed of trust to be executed and delivered
by a Subsidiary in such other form as shall be reasonably satisfactory
to the Agent (with respect to Mortgaged Property located in any other
state or foreign country), and covering the interests in real property
listed on Schedule II for which the Agent requests a Mortgage as
indicated on such schedule and any interests in real property acquired
by the Borrower or any Subsidiary of the Borrower pursuant to any
subsequent acquisition for which the Agent requests a Mortgage, in each
case as the same may be amended, supplemented or otherwise modified
from time to time.
"Mortgaged Properties": all of the interests in real estate in
which Liens are purported to be granted to the Agent pursuant to the
Mortgages.
"Multiemployer Plan": a Plan that is a multiemployer plan as
defined in Section 3(37) or 4001(a)(3) of ERISA.
"Net Proceeds": (a) 100% of the cash proceeds of any Covered
Sale by the Borrower or any of its Subsidiaries (including any cash
payments received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable
or otherwise, but only as and when received) of such Covered Sale net
of (i) attorneys' fees, accountants' fees, investment banking fees,
survey costs, title insurance premiums, and related search and
recording charges, transfer taxes, deed or mortgage recording taxes,
required debt payments (other than pursuant hereto), other customary
expenses and brokerage, consultant and other customary fees actually
incurred in connection therewith; provided, however, such expenses and
fees do not exceed, in the aggregate, 10% of the gross sales price of
such Covered Sale and (ii) taxes paid or payable as a result thereof;
(b) 100% of Qualifying Insurance and Other Proceeds; and (c) 100% of
all Pension Plan Reversion Proceeds.
"New Subsidiary": each Subsidiary of the Borrower organized,
formed or acquired after the Closing Date.
"Non-Excluded Taxes": as defined in subsection 3.5(a).
"Notes": the collective reference to the Term Notes and the
Letter of Credit Notes.
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"Original Credit Agreement": as defined in the first recital
of this Agreement.
"Other Taxes": is defined in subsection 3.5(a).
"Participant": as defined in subsection 10.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Pension Plan Reversion Proceeds": the amount of the cash and
the fair market value of any and all other property received (directly
or indirectly) by the Borrower or any Commonly Controlled Entity after
the Closing Date from any stock bonus, pension or profit-sharing plan
(or trust thereunder) which was treated by the Borrower or such
Commonly Controlled Entity as a plan qualified under Code Section
401(a) which shall not have been applied by the Borrower or such
Commonly Controlled Entity to payment of tax, if any, imposed under
Code Section 4980(a) with respect to the receipt of such cash or other
property.
"Permitted Asset Sale": a sale permitted by any of subsections
7.5(b), 7.6(a) and 7.6(c).
"Permitted Liens": as defined in subsection 7.3.
"Person": an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan which
is covered by ERISA, and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Plan of Reorganization": as defined in the preamble above.
"Pro Rata Letter of Credit Share": with respect to each Letter
of Credit Lender, the percentage set forth below:
Letter of Credit Lender Percentage
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Credit Lyonnais New York Branch 34.2358300000
PB Capital Corporation f/k/a BHF (USA) Capital
Corporation 21.9298245526
Bank Austria Creditanstalt Corporate Finance, Inc. 15.7894736842
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Skandinaviska Enskilda Banken Corporation 11.2179486842
ABN AMRO Bank N.V. 11.2179487105
Suntrust Bank 5.6089743684
"Qualifying Insurance and Other Proceeds": any insurance
proceeds payable to the Borrower or any of its Subsidiaries after the
Closing Date on account of a Casualty Loss which shall not have been
applied by the Borrower or such Subsidiary to the payment of the cost
of repair or replacement of the property subject to such Casualty Loss
within six months of the date such insurance proceeds are actually
received by the Borrower or such Subsidiary.
"Register": as defined in subsection 10.6(d).
"Regulation U": Regulation U of the Board of Governors as in
effect from time to time.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of
Section 4241 of ERISA.
"Reportable Events": any of the events set forth in Section
4043(b) of ERISA, other than those events as to which the thirty day
notice period is waived under subsections 13, 14, 15, 18, 19 or 20 of
PBGC Reg.ss. 2615.
"Required Lenders": at any time, Lenders the outstanding Loans
of which aggregate in excess of 50%.
"Required Prepayment": $3,000,000; provided, however, if the
Allowed Claim on the Closing Date is less than $40,000,000, the
Required Prepayment will be reduced, up to $3,000,000, dollar for
dollar, for every dollar by which the Allowed Claim on the Closing Date
is less than $40,000,000.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of its property or to which such Person or any of its property is
subject.
"Responsible Officer": with respect to the Borrower or any
Subsidiary, any one of the chairman of the board, the chief executive
officer, the president and the executive vice president of the Borrower
or such Subsidiary or, with respect to financial matters, the chief
financial officer or treasurer of the Borrower or such Subsidiary.
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"Restricted Payment": as defined in subsection 7.7.
"Revenue-Based Supplemental Principal Payment": as defined in
subsection 3.1(e).
"SE Banken": Skandinaviska Enskilda Banken.
"SE Banken Loan": the loan made by SE Banken to Silver Weibull
in the original committed principal amount of $2,500,000.
"SEC": the United States Securities and Exchange Commission or
any successor thereto.
"Security Agreements": collectively, the Borrower Security
Agreement and the Subsidiary Security Agreements.
"Security Documents": collectively, the Leasehold Mortgages,
the Mortgages, the Security Agreements, the Borrower Pledge Agreement,
and all other security documents hereafter delivered to the Agent
granting or purporting to grant a Lien on any asset or assets of any
Person to secure the obligations and liabilities of the Borrower and/or
the Foreign Subsidiaries hereunder and/or under any of the other Loan
Documents or to secure any guarantee of any such obligations and
liabilities.
"Silver Weibull": Silver Weibull AB (Sweden).
"Single Employer Plan": any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.
"Solvent": when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "present fair
saleable value" of the assets of such Person will, as of such date,
exceed the amount that will be required to pay all "liabilities of such
Person, contingent or otherwise", as of such date (as such quoted terms
are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors) as such debts
become absolute and matured, (b) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, and (c) such Person will be able to pay its debts as they
mature, taking into account the timing of and amounts of cash to be
received by such Person and the timing of and amounts of cash to be
payable on or in respect of indebtedness of such Person; in each case
after giving effect to as of the Closing Date the making of the Loans
to be made on the Closing Date and to the application of the proceeds
of such Loans. For purposes of this definition, (i) "debt" means
liability on a "claim", and (ii) "claim" means any (x) right to
payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach
gives
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rise to a right to payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured or unmatured,
disputed, undisputed, secured or unsecured.
"Subsidiary": as to any Person, a corporation, partnership or
other entity of which shares of stock or other ownership interests
having ordinary voting power to elect a majority of the board of
directors or other managers of such corporation, partnership or other
entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to
a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Borrower, including all Domestic
Subsidiaries and Foreign Subsidiaries of the Borrower.
"Subsidiaries' Guarantee": the Guarantee previously executed
and delivered by each Subsidiary of the Borrower as reaffirmed as of
the date hereof (other than any Foreign Subsidiary with respect to
which the making of such Guarantee is prohibited under the laws of the
jurisdiction in which such Foreign Subsidiary is organized)
substantially in the form of Exhibit D-1, or as amended and restated
substantially in the form of Exhibit D-2, and any other guarantee
executed and delivered by a Subsidiary formed on or after the date
hereof by the Borrower, in accordance with the terms hereof, in each
case as the same may be amended, supplemented or otherwise modified
from time to time.
"Subsidiary Pledge Agreement": each Amended and Restated
Pledge Agreement to be executed and delivered by each Subsidiary,
substantially in the form of Exhibit E, which is substantially in the
form previously executed by each such Subsidiary and any other pledge
agreement executed and delivered by a Subsidiary of the Borrower, in
accordance with the terms hereof, in each case as the same may be
amended, supplemented or otherwise modified from time to time.
"Subsidiary Security Agreement": collectively, (a) each
Amended and Restated Security Agreement to be executed and delivered by
each Subsidiary of the Borrower in favor of the Agent, substantially in
the form of Exhibit F-1, which is substantially in the form previously
executed by each Subsidiary as modified to reflect revisions to the
Uniform Commercial Code, and any other security agreement executed and
delivered by a Subsidiary in accordance with the terms hereof, in each
case as the same may be amended, supplemented or otherwise modified
from time to time and (b) each Amended and Restated Subsidiary
Trademark Security Agreement, Amended and Restated Subsidiary Patent
Collateral Assignment and Amended and Restated Subsidiary Copyright
Security Agreement to be executed by each Subsidiary in favor of the
Agent, substantially in the forms of Exhibits F-2(a), F-2(b) and
F-2(c), which are substantially in the forms previously executed by
each Subsidiary and any other intellectual property security agreement
executed by a Subsidiary in accordance
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with the terms hereof, in each case as the same may be amended,
supplemented or otherwise modified from time to time.
"Subsidiary Security Documents": collectively, the Subsidiary
Security Agreements and the Subsidiary Pledge Agreements.
"Term Loan": as defined in subsection 2.1.
"Term Loan Lenders": those Lenders set forth on Schedule IA
hereto under the heading "Term Loan Lenders."
"Term Note": as defined in subsection 2.3(d)(i).
"Transferee": as defined in subsection 10.6(f).
"Troubled Subsidiaries": collectively, Consolidated Process
Machinery, Inc.; Thermotech Systems Corporation; Gumaco (Brasil) Inc.;
Silver Weibull AB; CPM Brazil, Inc.; CPM do Brasil Ltda.; Gumaco, Inc.;
Gumaco Industria e Comercio Ltda.; Gumaco Projetos e Montagens
Industriais Ltda.; CPM Industria e Comercio Ltda.; Gencor ACP Holdings
Limited; Gencor ACP Ltd.; ACP Technical Services Limited; and ACP Cast
Parts Limited.
"Undrawn Letters of Credit": that portion of the Unexpired
Letters of Credit that have not been presented for payment nor paid by
the Issuing Bank.
"Unexpired Letters of Credit": those unexpired letters of
credit in the aggregate face amount of $470,000 issued under the
Original Credit Agreement and as further described in Schedule IC.
"Voting Stock": as to any Person, the Capital Stock of such
Person normally entitled to vote in the election of directors of such
Person. With respect to the Borrower, the term "Voting Stock" includes
both the Common Stock and the Class B Stock of the Borrower (unless
otherwise specified).
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Loan Document or any certificate or other document made or
delivered pursuant hereto.
(b) As used herein and in any Loan Document and any certificate or
other document made or delivered pursuant hereto, accounting terms relating to
the Borrower and its Subsidiaries not defined in subsection 1.1 and accounting
terms partly defined in subsection 1.1, to the extent not defined, shall have
the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
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(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(e) Sections and subsections headings in this Agreement are included
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or in any way affect the meaning or construction
of any provision of this Agreement.
SECTION 1.A. RATIFICATION
1.A.1 Obligations Under Original Credit Agreement. The Borrower hereby
acknowledges, ratifies, confirms and agrees that the Allowed Claim constitutes
outstanding obligations of the Borrower under the Original Credit Agreement,
without offset, defense or counterclaim of any kind, nature or description
whatsoever.
1.A.2 Acknowledgment of Security Interests and Liens.
(a) The Borrower hereby acknowledges, ratifies, confirms and agrees
that the Agent, for the benefit of itself and the Lenders, has and shall
continue to have a security interest in and lien upon the Collateral heretofore
granted to the Agent pursuant to the Original Credit Agreement and documents
executed in connection therewith, as well as a security interest in and lien
upon any Collateral granted under this Agreement or under any of the other Loan
Documents.
(b) The Borrower hereby acknowledges, ratifies, confirms and agrees
that the liens and security interests of the Agent in the Collateral shall be
deemed to be continuously granted, attached and perfected from the earliest date
of the granting, attachment and perfection of such liens and security interests.
SECTION 2. AMOUNT AND TERMS OF TERM LOANS AND LETTER OF CREDIT LOANS
2.1 Term Loans; Letter of Credit Loans.
(a) Term Loans. In accordance with the terms of the Plan of
Reorganization, each Term Loan Lender's pro rata share of the Allowed Claim
(each such share a "Term Loan"), excluding that portion of the Allowed Claim
representing the Letters of Credit, is an amount equal to the amount set forth
opposite such Lender's name in Schedule IA under the heading "Term Loan Amount"
as such amount may be reduced from time to time pursuant to this Agreement,
collectively, as to all Term Loan Lenders, the "Term Loans."
(b) Letter of Credit Loans. Each Letter of Credit Lender's pro rata
share of that portion of the Allowed Claim representing the Letters of Credit
(each such share a "Letter of Credit Loan") is an amount equal to the amount set
forth opposite such Letter of Credit Lender's name in Schedule IB under the
heading "Letter of Credit Loan Amount" as such amount may be reduced from time
to time pursuant to this Agreement, collectively, as to all Letter of Credit
Lenders, the "Letter of Credit Loans."
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2.2 Repayment of Term Loans and Letter of Credit Loans; Limited
Repayment Deferral. (a) (a) The Borrower hereby unconditionally promises to pay
to the Agent for the account of the Lenders in repayment of the principal amount
of the Term Loans and Letter of Credit Loans outstanding to each Lender the
amounts set forth below on the Closing Date and thereafter on the first Business
Day of each month and year, set forth below; provided that, notwithstanding the
foregoing, the aggregate then unpaid principal amount of the Loans shall be
payable on the Maturity Date (or such earlier date on which the Loans become due
and payable pursuant to Section 3 or 8):
Month, Year Amount
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December, 2001 $320,000
January, 2002 through July, 2002 $320,000 per month
August, 2002 through August, 2005 $400,000 per month
Maturity Date Remaining outstanding
balance of Loans
(b) The Borrower hereby further agrees to pay interest on the unpaid
principal amount of the Term Loans and Letter of Credit Loans from time to time
outstanding from the date hereof until payment in full thereof at the rates per
annum, and on the dates, set forth in subsection 3.2. Undrawn Letters of Credit
shall not be deemed outstanding but shall bear interest at the rates set forth
in subsection 3.2. Notwithstanding the foregoing, the Borrower shall pay in full
each Undrawn Letter of Credit on the Maturity Date for application to any
drawings under the Letters of Credit until sixty days after the expiration of
such Letters of Credit (the "Letter of Credit Cash Collateral"). If all
obligations to the Lenders and the Agent have been fully satisfied, the Agent
shall remit any balance of the Letter of Credit Cash Collateral to the Borrower.
(c) The Borrower has advised the Agent and the Lenders, and the Agent
and the Lenders hereby acknowledge, that the Borrower may be unable to pay to
the Agent for the account of the Lenders some or all of the thirteen monthly
principal payments due between December, 2001, and December, 2002. In order to
accommodate the Borrower, the Agent and the Lenders have agreed that, during
such period, the Borrower, may defer paying any one or more of the principal
payments. Any such principal payment that is not made when due shall be deemed a
"Deferred Principal Payment." The aggregate unpaid principal amount of the
Deferred Principal Payments shall be payable on the Maturity Date (or such
earlier date on which the Loans become due and payable pursuant to Section 3 or
8) unless prepaid sooner in accordance with subsection 3.1. Deferred Principal
Payments shall bear interest at the rates set forth in subsection 3.2.
2.3 Evidence of Term Loan and Letter of Credit Loan. (a) (a) Each Term
Loan Lender shall maintain in accordance with its usual practice an account or
accounts evidencing indebtedness of the Borrower to such Term Loan Lender
resulting from the Term Loans outstanding to such Lender, including the amounts
of principal and interest payable and paid to
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such Lender from time to time under this Agreement. The Letter of Credit Lenders
shall maintain similar accounts with respect to the Letter of Credit Loans.
(b) The Agent shall maintain the Register pursuant to subsection
10.6(d), and a subaccount therein for each Lender, in which shall be recorded
(i) the amount of each Loan made hereunder, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) both the amount of any sum received by the Agent
hereunder from the Borrower and each Lender's share thereof, if any.
(c) The entries made in the Registers and the accounts of each Lender
maintained by the Agent pursuant to subsection 2.3(b) shall, to the extent
permitted by applicable law, be prima facie evidence of the existence and,
amounts of the obligations of the Borrower therein recorded; provided, however,
that the failure of any Lender or the Agent to maintain the Registers or any
such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
the Borrower by such Lender in accordance with the terms of this Agreement.
(d) The Borrower agrees that at the closing on the Closing Date the
Borrower will execute and deliver to each Lender or Letter of Credit Lender, as
the case may be, (i) a promissory note of the Borrower evidencing the Term Loan
outstanding to such Lender, substantially in the form of Exhibit G-1 (a "Term
Note"), payable to the order of such Lender and in a principal amount equal to
such Lender's Term Loan as set forth on Schedule IA and (ii) a promissory note
of the Borrower evidencing the Letter of Credit Loan to such Letter of Credit
Lender, substantially in the form of Exhibit G-2 (a "Letter of Credit Note"),
payable to the order of such Letter of Credit Lender and in a principal amount
equal to such Letter of Credit Lender's Letter of Credit Loan as set forth on
Schedule IB. Each Term Loan Lender or Letter of Credit Lender is hereby
authorized to record the date and amount of each Term Loan or Letter of Credit
Loan outstanding to such Lender, the date and amount of each payment or
prepayment of principal thereof, on the schedule annexed to and constituting a
part of its Term Note or Letter of Credit Note, as the case may be; provided,
however, that the failure to make any such recordation (or any error therein)
shall not in any manner affect the obligation of the Borrower to repay (with
applicable interest) the Term Loans or the Letter of Credit Loans made to the
Borrower in accordance with the terms of this Agreement.
SECTION 3. GENERAL PROVISIONS APPLICABLE TO LOANS
3.1 Prepayments. (a) (a) The Borrower may at any time and from time to
time, prepay the Loans, in whole or in part, without premium or penalty, upon at
least three Business Days' irrevocable notice to the Agent, specifying the date
and amount of prepayment. Upon receipt of any such notice the Agent shall
promptly notify each Lender thereof. If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified therein,
together with any amounts payable pursuant to subsection 3.6, if any, and
accrued interest to such date on the amount prepaid. Partial prepayments of the
Loans shall be applied on a pro rata basis between the outstanding Loans and
shall be applied to the remaining installments of principal thereof in the
inverse order of their maturities if such prepayments are mandatory prepayments
and in the scheduled order of their maturities if such prepayments are voluntary
prepayments, provided that voluntary prepayments shall be applied first to
outstanding
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Deferred Principal Payments, if any. Amounts prepaid on account of the Loans may
not be reborrowed. Such partial prepayments shall be in an aggregate principal
amount of no less than $200,000.
(b) The Net Proceeds of any Covered Sale, Qualifying Insurance and
Other Proceeds and Pension Plan Reversion Proceeds shall be applied toward the
prepayment of the Loans in the inverse order of their maturities and may not be
reborrowed, provided, however, that if by March 31, 2002, the Agent for the
account of the Lenders receives from the Borrower the proceeds of General
Combustion Limited's sale of real property in Billingshurst, England (the
"Billingshurst Facility"), the proceeds of the sale of the Billingshurst
Facility will be applied first toward the prepayment of any Deferred Principal
Payments and then toward the payment of any as-yet-unpaid principal payments due
during calendar year 2002 and, provided further, that if the Agent for the
account of the Lenders receives the proceeds of the Billingshurst Facility sale
after March 31, 2002, but before July 1, 2002, one-half of the proceeds of the
sale of the Billingshurst Facility will be applied first toward the prepayment
of any Deferred Principal Payments and then toward the payment of any
as-yet-unpaid principal payments due during calendar year 2002 and the other
one-half of the proceeds will be applied toward the prepayment of the Loans in
the inverse order of their maturities.
(c) The Borrower shall pay the Required Prepayment, if any, on or
before December 31, 2001. Such amount shall be applied to the prepayment of the
Loans in the inverse order of their maturities. The Borrower may make all or any
part of the Required Prepayment from the proceeds of any Covered Sale.
(d) If the Borrower receives from or on behalf of Midwest Employers
Casualty Co. any reimbursements or refunds in connection with the Midwest
Employers Casualty Letter of Credit, which the Borrower acknowledges has been
drawn in full by the beneficiary, the Borrower immediately shall remit all such
funds to the Agent for application to the amount due the Lenders on the Maturity
Date (or such earlier date on which the Loans become due and payable).
(e) If the combined revenue of the Borrower and its Subsidiaries for
any of the first three full quarters following December 31, 2001, exceeds the
projected revenue level for such quarter as set forth in the revenue projections
in Schedule 3.1(e), then within 60 days after the end of such quarter, the
Borrower shall pay to the Agent for the account of the Lenders an amount equal
to ten percent (10%) of the amount by which the actual quarterly revenue
exceeded the applicable quarterly revenue projection set forth in Schedule
3.1(e) (such amount due, a "Revenue-Based Supplemental Principal Payment"). Any
Revenue-Based Supplemental Principal Payments shall be applied first toward the
prepayment of any Deferred Principal Payments, second toward the prepayment of
any remaining principal payments during calendar year 2002 and finally toward
the prepayment of the Loans in the inverse order of their maturities.
3.2 Interest Rates and Payment Dates.
(a) Each outstanding Loan, including payments made by the Agent with
respect to the Disputed Letter of Credit, shall bear interest at a rate per
annum equal to the Base Rate. Amounts constituting Undrawn Letters of Credit
shall bear interest at a rate of 4.75% per
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annum. Amounts constituting Deferred Principal Payments, in addition to bearing
interest at the Base Rate, shall bear interest at the rate of 5% per annum from
the date of each such Deferred Principal Payment until repayment in full thereof
(the "Additional Interest Rate").
(b) If all or a portion of (i) the principal amount of any Loan, (ii)
any interest payable thereon or (iii) any fee or other amount payable hereunder
or under any other Loan Document shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest at a rate per annum that is 2% over the rate otherwise applicable
thereto, in each case from the date of such non-payment until such amount is
paid in full (before as well as after the applicable judgment, if any),
provided, however, that Deferred Principal Payments shall not be due until the
Maturity Date (unless accelerated pursuant to Section 8 or otherwise) and,
therefore, the increased rate of interest set forth in this subsection 3.2(b)
shall not apply to Deferred Principal Payments unless such sums are not paid
when due (whether at the stated maturity, by acceleration or otherwise).
(c) Interest, other than interest that accrues on Deferred Principal
Payments at the Additional Interest Rate (such interest, "Additional Interest"),
shall be payable in arrears on each Interest Payment Date, provided that
interest accruing pursuant to paragraph (b) of this subsection shall be payable
from time to time on demand. Additional Interest shall be payable on the
Maturity Date.
3.3 Computation of Interest and Fees. (a) Agent fees and interest shall
be calculated on the basis of a 365- (or 366-, as the case may be) day year for
the actual days elapsed. Any change in interest rate on a Loan resulting from a
change in the Base Rate shall become effective as of the opening of business on
the day on which such change becomes effective. The Agent shall as soon as
practicable notify the Borrower and the Lenders of the effective date and the
amount of each such change in interest rate.
(b) Each determination of an interest rate by the Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrower and
the affected Lenders in the absence of manifest error.
3.4 Pro Rata Treatment and Payments. All payments (including
prepayments) to be made by the Borrower hereunder, whether on account of
principal, interest, fees or otherwise, shall be made without set-off or
counterclaim and shall be made prior to 12:00 noon, New York City time, on the
due date thereof to the Agent, for the account of the Lenders or the Agent, as
the case may be, at the Agent's office specified in subsection 10.2, in Dollars
and in immediately available funds. Payments received by the Agent after such
time shall be deemed to have been received on the next Business Day. The Agent
shall distribute such payments to the Lenders entitled to receive the same
promptly upon receipt in like funds as received. If any payment hereunder
becomes due and payable on a day other than a Business Day, such payment shall
be extended to the next succeeding Business Day, and, with respect to payments
of principal, interest thereon shall be payable at the then applicable rate
during such extension.
3.5 Taxes. (a) All payments made by the Borrower under this Agreement
and the Notes shall be made free and clear of, and without deduction or
withholding for or on
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account of, any present or future taxes, levies, imposts, charges, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed
by, any Governmental Authority, excluding (i) net income taxes, franchise taxes,
or any other taxes imposed on or measured by the net income or profits of the
Agent or such Lender, in each case by the jurisdiction under the laws of which
the Agent or such Lender is organized or any political subdivision thereof or by
the jurisdiction in which the applicable lending, or issuing office of the Agent
or such Lender is located or any political subdivision thereof and (ii) U.S.
withholding taxes payable with respect to payments hereunder under laws
(including any treaty, ruling, determination or regulation) in effect on the
date hereof, but not any increase in U.S. withholding tax resulting from any
subsequent change in such laws occurring (x) after the date hereof in the case
of the Agent and any Lender as of the date of this Agreement, and (y) in the
case of any other Lender, the date of Assignment and Acceptance pursuant to
which it became a Lender (all such non-excluded taxes, levies, imposts, charges,
deductions and withholdings the "Non-Excluded Taxes"). In addition, the Borrower
agrees to pay to the relevant Governmental Authority in accordance with
applicable law any current or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies that arise from any payment
made hereunder or from the execution, delivery or registration of, or otherwise
with respect to, this Agreement ("Other Taxes"). If any Non-Excluded Taxes or
Other Taxes are required by law to be withheld from any amounts payable to the
Agent or any Lender hereunder or under the Notes, the amounts so payable to the
Agent or such Lender shall be increased to the extent necessary to yield to the
Agent or such Lender interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Agreement and the Notes. Whenever any
Non-Excluded Taxes or Other Taxes are payable by the Borrower, upon receipt
thereof, the Borrower shall send to the Agent for its own account or for the
account of such Lender, as the case may be, a certified copy of any original
official receipt received by the Borrower showing payment thereof. The Borrower
shall indemnify the Agent and the Lenders for the full amount of Non-Excluded
Taxes, Other Taxes and any taxes imposed by any jurisdiction on amounts payable
under this subsection 3.5(a) that are paid by such Lender or Agent, (including
penalties, interest and expenses arising therefrom or with respect thereto). If
the Borrower determines in good faith that a reasonable basis exists for
contesting any Non-Excluded Taxes or Other Taxes, such Lender or the Agent shall
cooperate with the Borrower in challenging such Non-Excluded Taxes or Other
Taxes at the Borrower's expense if requested by the Borrower (it being
understood and agreed that the Agent or such Lender shall have no obligation to
contest or responsibility for contesting such Non-Excluded Taxes or Other
Taxes). If any Lender receives a refund in respect of any Non-Excluded Taxes or
Other Taxes for which such Lender has received payment from the Borrower
hereunder, such Lender shall, within 3l days of receipt by such Lender, repay
such refund to the Borrower, provided that the Borrower, upon the request of
such Lender, agrees to return such refund (plus any penalties, interest or other
charges) to the Lender in the event such Lender is required to repay such
refund. The agreements in this subsection shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(i) in the case of a Lender that is a "bank" under Section
881(c)(3)(A) of the Code:
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(A) on or before the date of the first payment to
such Lender pursuant to this Agreement following the Closing
Date or on or before the effective date of the Assignment and
Acceptance, deliver to the Borrower and the Agent (x) two duly
completed copies of United States Internal Revenue Service
Form W-8BEN or W-8ECI, or successor applicable form, as the
case may be, and (y) an Internal Revenue Service Form W-8 or
W-9, or successor applicable form, as the case may be;
(B) deliver to the Borrower and the Agent two further
copies of any such form or certification on or before the date
that any such form or certification expires or becomes
obsolete and promptly upon the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrower; and
(C) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Agent; or
(ii) in the case of a Lender that is not a "bank" under
Section 881(c)(3)(A) of the Code:
(A) deliver to the Borrower and the Agent (1) a
statement under penalties of perjury that such Lender (x) is
not a "bank" under Section 881(c)(3)(A) of the Code, is not
subject to regulatory or other legal requirements as a bank in
any jurisdiction, and has not been treated as a bank for
purposes of any tax, securities law or other filing or
submission trade to any Governmental Authority, any
application made to a rating agency or qualification for any
exemption from tax, securities law or other legal
requirements, (y) is not a 10 percent shareholder within the
meaning of Section 881(c)(3)(B) of the Code and (z) is not a
controlled foreign corporation receiving interest from a
related person within the meaning of Section 881(c)(3)(C) of
the Code and (11) an Internal Revenue Service Form W-8;
(B) deliver to the Borrower and the Agent a further
copy of said Form W-8, or any successor applicable form or
other manner of certification on or before the date that any
such Form W-8 expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent
form previously delivered by such Lender; and
(C) obtain such extensions of time for filing and
complete such forms or certifications as may be reasonably
requested by the Borrower or the Agent;
unless, in any such case, an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders any such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender so advises the
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Borrower and the Agent. Such Lender shall certify (i) in the case of a Form
W-8BEN or W-8ECI, that it is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes and
(ii) in the case of a Form W-8 or W-9, that it is entitled to an exemption from
United States backup withholding tax. Each Person that shall become a
Participant pursuant to subsection 10.6 shall, upon the effectiveness of the
related transfer, be required to provide all of the forms and statements
required pursuant to this subsection to the Lender from which the related
participation shall have been purchased.
3.6 Indemnity. The Borrower agrees to indemnify each Lender and to hold
each Lender harmless from any loss or reasonable expense which such Lender may
sustain or incur as a consequence of default by the Borrower for any reason in
making any prepayment after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement. Such loss or reasonable
expense may include any loss, including loss of anticipated profits, costs or
expenses incurred by reason of the liquidation or reemployment of deposits or
other funds in order to fund or maintain such Loans. This covenant shall survive
the termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.
3.7 Change of Lending Office. Each Lender agrees that it will use all
reasonable efforts (so long as such designation would not be adverse to it, as
determined in its sole judgment) to designate a lending office or a different
lending office if the making of such a designation would reduce or obviate the
need for the Borrower to make payments under subsection 3.5(a).
3.8 Annual Agency Fee. On the Closing Date and on each anniversary date
of the Closing Date until the later of the termination of this Agreement or
until all Indebtedness under this Agreement has been paid and satisfied in full,
the Borrower agrees to pay to the Agent, for the Agent's own account, an annual
agency fee in the amount of $75,000 in respect of services by the Agent for the
following year and which fee is fully earned and due and payable as of each such
date.
3.9 Field Examination and Appraisal Fees. The Borrower agrees to pay
all reasonable costs, fees and expenses incurred by the Agent with respect to
the Agent's field examinations of the Borrower's operations and all appraisals
of any of the Collateral as permitted herein:
(a) Field Examinations. If (i) the opinion of the Borrower's
independent auditors in connection with the financial statements furnished to
the Agent pursuant to subsection 6.1 below shall contain a "going concern" or
like qualification or exception, or qualification arising out of the scope of an
audit, or (ii) the Borrower or any of its Active Subsidiaries fails to furnish
to the Agent, with a copy for each Lender, by December 31 of any calendar year
the financial statements described in subsection 6.1(a) for the fiscal year
ended September 30 of such calendar year, then, for each such fiscal year, the
Agent may request that BDO Seidman, LLP, or another accounting firm selected by
the Agent ("Agent's Accountant") on behalf of the Agent and the Lenders, conduct
a field examination of the operations of the Borrower and the Active
Subsidiaries. The Borrower and its Active Subsidiaries shall instruct their
independent auditors to furnish their audit work papers to Agent's Accountant at
least 10 business days prior to the field examination and to cooperate fully
with Agent's Accountants in
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all reasonable respects. Such instructions shall be in writing with a copy
provided to the Agent. An officer of the Agent shall be present for the field
examination and audit, which will be conducted primarily by two field examiners
and/or auditors for three days. The Borrower shall be responsible for all costs,
fees and expenses of the field examination and audit, including, but not limited
to, those of the Agent's officer. If an Event of Default shall have occurred and
be continuing, the Agent, for itself and on behalf of the Lenders, may conduct
any such field examinations as it deems reasonably necessary and advisable, with
all costs, fees and expenses to be borne by the Borrower.
(i) Appraisals. The Agent, for itself and on behalf of the
Lenders, shall conduct two scheduled appraisals of all real property
sites owned by the Borrower or its Active Subsidiaries, the first such
appraisal to be completed by February 28, 2002, and the second such
appraisal to be completed by December 31, 2004. If an Event of Default
shall have occurred and be continuing, however, the Agent, for itself
and on behalf of the Lenders, may conduct appraisals of any of the
Collateral, as the Agent deems reasonably necessary and advisable, with
all costs, fees and expenses to be borne by the Borrower. All
appraisals will be performed by reputable appraisers selected in
advance by the Agent. The Agent shall advise the Borrower of the names
of the appraisers that bid to perform the appraisals and of the bid
prices submitted, but the Agent shall retain sole discretion over the
final selection of appraisers. The Borrower shall, and shall cause its
Active Subsidiaries to, cooperate fully with any and all appraisers
selected by the Agent, including, but not limited to, affording the
appraisers access to real property sites and providing the appraisers
with documentation that the appraisers reasonably request in order to
complete their appraisals.
SECTION 3.A RENEWAL OF UNEXPIRED LETTERS OF CREDIT
3.A.1 Renewal.On the terms and conditions hereinafter set forth, Credit
Lyonnais New York Branch, in its capacity as issuing bank (the "Issuing Bank"),
on behalf of the Letter of Credit Lenders, may renew any Unexpired Letter of
Credit upon the request of the Borrower in accordance with the terms of the
applicable Unexpired Letter of Credit. Such request by the Borrower for the
renewal of an Unexpired Letter of Credit may be made by telephone, e-mail or
telecopy, confirmed immediately in writing if by telephone. If the Issuing Bank
does not intend to renew an Unexpired Letter of Credit, it shall give notice to
the beneficiary in accordance with the terms of such Unexpired Letter of Credit
of its intention not to renew the Unexpired Letter of Credit. The Borrower may
cancel an Unexpired Letter of Credit prior to renewal of such Unexpired Letter
of Credit by telephone, e-mail or telecopy, confirmed immediately in writing if
by telephone, to the Issuing Bank and the Agent, such request to be accompanied
by (i) the beneficiary's duly executed, written acknowledgment of the
cancellation of such Unexpired Letter of Credit and (ii) the original Unexpired
Letter of Credit bearing such beneficiary's name. In the event of any renewal or
non-renewal of an Unexpired Letter of Credit, the Agent, on behalf of the
Issuing Bank, shall give each Letter of Credit Lender prompt notice thereof by
telephone, e-mail or telecopy, confirmed promptly in writing if by telephone.
3.A.2 Participation by Letter of Credit Lenders. Immediately upon
renewal by the Issuing Bank of any Unexpired Letter of Credit in accordance with
the procedures set forth in
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this Section 3.A, each Letter of Credit Lender shall be deemed to have
irrevocably and unconditionally purchased and received from the Issuing Bank,
without recourse or warranty, an undivided interest and participation to the
extent of such Letter of Credit Lender's Pro Rata Letter of Credit Share of such
renewed Unexpired Letter of Credit (including, without limitation, all
obligations of the Borrower with respect thereto).
3.A.3 Drawings. In the event that any drawing shall be made under an
Unexpired Letter of Credit, by demand or claim (including, without limitation,
any draft), the Issuing Bank shall notify the Borrower and the Letter of Credit
Lenders via telephone, e-mail or telecopy of such drawing, confirmed promptly in
writing if by telephone. Drawn Letters of Credit shall be deemed to be an
outstanding Letter of Credit Loan and bear interest at a rate per annum equal to
the Base Rate. Immediately upon receipt of such notice, the Letter of Credit
Lenders shall pay to the Issuing Bank the amount of their respective
participations in the Drawn Letter of Credit. In the event that any Letter of
Credit Lender fails timely to pay the amount of its participation as required by
this subsection, interest shall accrue thereon at the Federal Funds Rate for the
first three Business Days following the date of payment by the Issuing Bank and
the Federal Funds Rate plus 1% for the period thereafter to the date of payment
thereof by such Letter of Credit Lender.
3.A.4 Other Lender. Any action taken or omitted to be taken by the
Issuing Bank under or in connection with any Unexpired Letter of Credit, if
taken or omitted in the absence of gross negligence or willful misconduct, shall
not put the Issuing Bank under any resulting liability to any Lender or relieve
any Letter of Credit Lender of its obligations hereunder to the Issuing Bank. In
determining whether to pay under any Unexpired Letter of Credit, the Issuing
Bank shall have no obligation to the Lenders other than to confirm that any
documents required to be delivered under such Unexpired Letter of Credit appear
to have been delivered and that they appear to comply on their face with the
requirements of such Unexpired Letter of Credit.
3.A.5 Indemnification. The Borrower shall indemnify and hold harmless
the Issuing Bank from and against any and all claims, damages, losses,
liabilities, reasonable costs and expenses of any kind whatsoever, including
reasonable fees and expenses of attorneys and paralegals that the Issuing Bank
may incur (or that may be claimed against the Issuing Bank by any Person),
together with all reasonable costs and expenses resulting from the compromise or
defense of any claims or liabilities hereinafter described, by reason of or in
connection with (a) the execution and delivery or transfer of, or payment or
failure to pay under, any Unexpired Letter of Credit, (b) any suit, action or
proceeding brought by any person to require or prevent payment under any
Unexpired Letter of Credit, or (c) any breach by the Borrower of any warranty,
covenant, term or condition in, or the occurrence of any default under, any of
the Loan Documents (to the extent related to Unexpired Letters of Credit), any
Unexpired Letter of Credit or any related contract, together with all reasonable
expenses resulting from the compromise or defense of any claims or liabilities
arising as a result of any such breach or default and defense against any legal
action commenced to challenge the validity of any of such documents; provided,
however, that the Borrower shall not be required to indemnify the Issuing Bank
for any claims, damages, losses, liabilities, costs or expenses to the extent,
but only to the extent, caused by (i) the gross negligence or willful misconduct
(as determined in a final, non-appealable
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judgment in a court of competent jurisdiction) of the Issuing Bank in
determining whether a draft, certificate or other documents presented under any
Unexpired Letter of Credit complied with the terms of such Unexpired Letter of
Credit, or (ii) the Issuing Bank's willful failure to pay under any Unexpired
Letter of Credit after the presentation to it by the beneficiary thereof of a
draft, certificate or other document strictly complying with the terms and
conditions of such Unexpired Letter of Credit. In case any action or proceeding
is brought against the Issuing Bank in respect of which indemnity may be sought
under this Agreement, the Issuing Bank shall promptly give notice of any such
action or proceeding to the Borrower and may require the Borrower, upon such
notice, to assume the defense of the action or proceeding, provided that failure
of the Issuing Bank to give such notice shall not relieve the Borrower of any of
its obligations under this subsection. Upon receipt of such notice from the
Issuing Bank requesting that the Borrower assume such defense, the Borrower
shall resist and defend such action or proceeding at the Borrower's sole cost
and expense. The obligations of the Borrower under this subsection shall survive
the termination of the Unexpired Letters of Credit and this Agreement.
3.A.6 Liability of the Issuing Bank. The Borrower assumes all risks of
the acts or omissions of the users of any Unexpired Letter of Credit and all
risks of the misuse of any Unexpired Letter of Credit. Neither the Issuing Bank,
nor any of its officers, directors, employees or agents shall be liable or
responsible for: (a) the use which may be made of any Unexpired Letter of Credit
or for any acts or omissions of any Person and any transferee in connection
therewith; (b) the validity, sufficiency or genuineness of documents, or of any
endorsement or endorsements thereon, even if such documents should in fact prove
to be in any or all respects invalid, insufficient, fraudulent or forged; (c)
payment against presentation of documents that do not comply with the terms of
the applicable Unexpired Letter of Credit, including failure of any documents to
bear any reference or adequate reference to such Unexpired Letter of Credit; or
(d) any other circumstances whatsoever in making or failing to make payment
under any Unexpired Letter of Credit, except only that the Borrower shall have a
claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower to the extent, but only to the extent, of damages suffered by the
Borrower that were caused by (i) the Issuing Bank's gross negligence or willful
misconduct (as determined in a final, non-appealable judgment by a court of
competent jurisdiction) in determining whether documents presented under any
Unexpired Letter of Credit comply with the terms of such Unexpired Letter of
Credit (it being understood that any such noncompliance in any immaterial
respect shall not be deemed gross negligence or willful misconduct of the
Issuing Bank) or (ii) the Issuing Bank's willful failure to pay under any
Unexpired Letter of Credit after the presentation to it by the beneficiary
thereof of a draft, certificate or other document strictly complying with the
terms and conditions of such Unexpired Letter of Credit. In furtherance and not
in limitation of the foregoing, the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary unless
the Issuing Bank shall have been ordered not to accept such documents by a court
of competent jurisdiction.
SECTION 3.B Disputed Letter of Credit Facility
3.B.1 Acknowledgment. The Borrower, the Agent, the Issuing Bank and the
Letter of Credit Lenders acknowledge that (i) SE Banken presented the Disputed
Letter of Credit
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to the Issuing Bank, (ii) the Issuing Bank rejected the presentment advising
that it did not comply with the terms of the Disputed Letter of Credit, and
(iii) the Disputed Letter of Credit expired on April 30, 2001.
3.B.2 Purchase; Assumption. Each Letter of Credit Lender hereby
irrevocably and unconditionally purchases and assumes and shall be deemed to
have received from the Issuing Bank, without recourse or warranty, an undivided
interest and participation in the Disputed Letter of Credit. Each Letter of
Credit Lender hereby assumes its Pro Rata Letter of Credit Share of all costs,
fees, expenses, damages, claims, liabilities or expenses, including without
limitation, reasonable attorneys' fees (collectively, "Damages"), incurred by
the Agent and/or the Issuing Bank in connection with the Disputed Letter of
Credit, including any Damages incurred by the Agent and/or the Issuing Bank as a
result of the failure to honor the Disputed Letter of Credit; provided, however,
that the Letter of Credit Lenders shall have no obligation to the Issuing Bank
or the Agent pursuant to this subsection 3.B.2 if, but for the willful
misconduct or gross negligence of the Issuing Bank or the Agent (as determined
in a final, non-appealable judgment by a court of competent jurisdiction), the
Damages for which the Issuing Bank or the Agent seeks reimbursement or payment
would not have arisen. If the Issuing Bank or the Agent incurs any Damages
related to the Disputed Letter of Credit, it shall notify the Letter of Credit
Lenders of such Damages, which the Letter of Credit Lenders agree to reimburse
to the Issuing Bank or the Agent in accordance with their Pro Rata Letter of
Credit Shares.
3.B.3 Payments Under Disputed Letter of Credit. In the event that the
Agent or the Issuing Bank makes any payment(s) to SE Banken under the Disputed
Letter of Credit, the Agent or the Issuing Bank shall notify the Borrower via
telephone, e-mail or telecopy of such payment. Any amount paid or to be paid by
the Agent or the Issuing Bank under the Disputed Letter of Credit shall be added
to the outstanding unpaid principal amount of the Letter of Credit Loans due and
payable on the Maturity Date (or such earlier date on which the Loans become due
and payable) and, once paid by the Agent or the Issuing Bank, shall bear
interest at a rate per annum equal to the Base Rate. In addition, regardless of
whether the Agent or the Issuing Bank makes any payment(s) to SE Banken under
the Disputed Letter of Credit, if the Agent notifies the Borrower of any Damages
incurred by the Agent in connection with the Disputed Letter of Credit, within
30 days the Borrower shall reimburse the Agent or the Issuing Bank, as
applicable, in immediately available funds for such Damages incurred by the
Agent or the Issuing Bank.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Agent and the Lenders to enter into this Agreement, the
Borrower hereby represents and warrants to the Agent and each Lender, that:
4.1 Financial Condition. (a) The audited consolidated balance sheets of
the Borrower and its consolidated Subsidiaries, as of September 30, 1999, and
2000, have been certified by the Borrower's independent auditors, acceptable to
the Agent, and the related audited consolidated statements of income,
shareholders' equity and cash flows for the two fiscal years then ended copies
of which have heretofore been furnished to each Lender, present fairly the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such dates and the consolidated results of their operations
and their cash flows for the two fiscal years then ended, in conformity with
GAAP.
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(b) The unaudited consolidated balance sheets of the Borrower and its
consolidated Subsidiaries, for each of the fiscal quarters ended December 31,
2000, March 31, 2001, and June 30, 2001, and the related unaudited consolidated
statements of income for each such fiscal quarter, and the unaudited
consolidated balance sheets of the Borrower and its consolidated Subsidiaries,
for the nine-month period ended June 30, 2001, and the related unaudited
consolidated statements of income for such period, all certified by a
Responsible Officer, copies of which have heretofore been furnished to each
Lender, present fairly the consolidated financial condition of the Borrower and
its consolidated Subsidiaries as at such date, and the consolidated results of
their operations for the period then ended (subject to normal year-end audit
adjustments and the absence of certain notes thereto). All such financial
statements, including the related schedules and notes thereto, have been
prepared on a basis consistent with the September 30, 2000, financial statements
of the Borrower.
4.2 Corporate Existence; Compliance with Law. The Borrower and each
Active Subsidiary (a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has the corporate
power and authority to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged,
(c) is duly qualified as a foreign corporation and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification except where the failure
to so qualify would not have a Material Adverse Effect and (d) is in compliance
with all Requirements of Law except to the extent that the failure to comply
therewith could not, in the aggregate, have a Material Adverse Effect.
4.3 Corporate Power, Authorization; Enforceable Obligations. Each Loan
Party has the corporate power and authority to make, deliver and perform the
Loan Documents to which it is a party, and has taken all necessary corporate
action to authorize the borrowings on the terms and conditions of this Agreement
and any Notes, to consummate the Plan of Reorganization and to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party. No consent, approval or authorization of, filing with, notice to or other
act by any Governmental Authority or any other Person is required in connection
with the borrowings hereunder, the Plan of Reorganization or with the execution,
delivery, and performance of the Loan Documents or the Plan of Reorganization to
which any Loan Party is a party or in connection with the transactions
contemplated thereby, other than (a) filings and recordings in order to perfect
the Liens in favor of the Agent for the benefit of the Lenders created by the
Security Documents, (b) such orders, consents, approvals and authorizations of,
and all notices and all written assumptions of obligations to, Governmental
Authorities and any other Persons which have been heretofore obtained, made or
given and are in full force and effect, and complete and correct copies of which
have heretofore been furnished to the Agent, (c) any consent, approval,
authorization, filing or notice, the failure of which to obtain would not have a
Material Adverse Effect, (d) filings of Uniform Commercial Code financing
statements listed in Schedule 4.3 in the appropriate filing offices in the
appropriate jurisdictions in favor of the Agent for the benefit of the Lenders
in order to perfect the Liens of the Agent for the benefit of the Lenders
created by the Security Documents and (e) filings related to any trademarks of
the Borrower or its Subsidiaries to perfect the Liens of the Agent for the
benefit of the Lenders created by any Subsidiary Trademark Security Agreement.
This Agreement has been, and each
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other Loan Document to which any Loan Party is or will be a party will be, duly
executed and delivered on behalf of such Loan Party that is a party thereto.
This Agreement constitutes, and each other Loan Document to which any Loan Party
is or will be a party when executed and delivered will constitute, a legal,
valid and binding obligation of each Loan Party thereto enforceable against it
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditor's rights generally and by general
equitable principles (whenever enforcement is sought by proceedings in equity or
at law).
4.4 No Legal Bar. The execution, delivery and performance of the Loan
Documents to which any Loan Party is a party, will not violate any Requirement
of Law or any indenture, agreement or other instrument to which any Loan Party
is a party or by which it or any of its property is bound and will not result
in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any such Requirement of Law or any
such indenture, agreement or other instrument.
4.5 No Material Litigation. Except as set forth in the Plan of
Reorganization and in the Disclosure Statement, no litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrower, threatened by or against any Loan Party or
against any of their respective properties or revenues (a) with respect to any
of the Loan Documents or any of the transactions contemplated hereby or thereby
or (b) which could reasonably be expected to have a Material Adverse Effect.
4.6 No Default. Neither the Borrower nor any Active Subsidiary is in
default under or with respect to any indenture, agreement or other instrument
(other than with respect to trade payables incurred in the ordinary course of
business) to which the Borrower or Active Subsidiary, as applicable, is a party
or by which it or any of its property is bound in any respect which could
reasonably be expected to have a Material Adverse Effect except for any such
indenture, agreement or other instrument related to Indebtedness that will be
satisfied and from which the Borrower or Active Subsidiary, as applicable, will
be released on the Closing Date. No default or event of default has occurred and
is continuing under the IRB Documents. No Default or Event of Default has
occurred and is continuing.
4.7 Ownership of Property; Liens. Each Loan Party has good record and
marketable title (except for such encumbrance or restriction arising in the
ordinary course of business which do not materially restrict the intended use of
such property) in fee simple to, or a valid leasehold interest in, all its real
property (other than any real property located in Brazil owned directly or
indirectly by CPM Brazil Inc. or any of its Subsidiaries), and good title to, or
a valid leasehold interest in, all its other material property, except for such
minor defects in title that do not affect the ability to use such property in
the conduct of its business, and none of such property is subject to any Lien
except as set forth on Schedule 4.7 or as permitted by subsection 7.3.
4.8 Intellectual Property. Each Loan Party owns, or is licensed to use,
all trademarks, tradenames, copyrights, technology, know-how and processes
necessary for the conduct of its business as currently conducted except for
those the failure to own or license which could not reasonably be expected to
have a Material Adverse Effect (the "Intellectual
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Property") and except for any Intellectual Property registered in Brazil and
owned directly or indirectly by CPM Brazil Inc. or any of its Subsidiaries. To
the best of the Borrower's knowledge, no claim has been asserted or is pending
by any Person challenging or questioning the use of any such Intellectual
Property by any Loan Party or the validity or effectiveness of any such
Intellectual Property except for such claims which even if successful could not
reasonably be expected to have a Material Adverse Effect, nor does the Borrower
know of any valid basis for any such claim. The use of such Intellectual
Property by any Loan Party does not infringe on the rights of any Person, except
for such claims and infringements that, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect.
4.9 No Burdensome Restrictions. After giving effect to the Plan of
Reorganization, no indenture, agreement or other instrument to which the
Borrower or any Active Subsidiary is a party or by which it or any of its
property is bound could reasonably be expected to have a Material Adverse
Effect.
4.10 Taxes. Except as otherwise disclosed in the Disclosure Statement
and in the Plan of Reorganization, the Borrower and each Active Subsidiary have
filed or caused to be filed all federal, state and local tax returns which, to
the knowledge of the Borrower, are required to be filed and has paid all taxes
shown to be due and payable on said returns or on any assessments made against
it or any of its property and all other material taxes, fees or other charges
imposed on it or any of its property by any Governmental Authority (other than
any the amount or validity of which are currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of such Loan Party).
4.11 ERISA. Except as otherwise disclosed in the Disclosure Statement
and in the Plan of Reorganization, neither a Reportable Event nor an
"accumulated funding deficiency" (within the meaning of Section 412 of the Code
or Section 302 of ERISA and whether or not waived) has occurred during the
five-year period prior to the date on which this representation is made or
deemed made with respect to any Plan that remains outstanding in any respect and
that could reasonably be expected to have a Material Adverse Effect, and each
Plan has complied in all material respects with the applicable provisions of
ERISA and the Code. Except with respect to the CPM Defined Benefit Plan, which,
subject to the approval of the proper Governmental Authorities, is due to be
terminated on February 28, 2002, no termination of a Single Employer Plan has
occurred, and no Lien in favor of the PBGC or a plan has arisen, during such
five-year period that has resulted in any material liability. Except with
respect to the CPM Defined Benefit Plan, the present value of all accrued
benefits under each Single Employer Plan based on those assumptions used to fund
such Plans) did not, as of the last annual valuation date prior to the date on
which this representation is made or deemed made, exceed the value of the assets
of such Plan allocable to such accrued benefits. Attached as Schedule 4.11(a) is
a copy of the "Notice of Intent to Terminate the Consolidated Process Machinery,
Inc. Pension Plan," executed by the administrator of the CPM Defined Benefit
Plan, as sent to all participants in the CPM Defined Benefit Plan, and setting
forth the date on which the CPM Defined Benefit Plan will be terminated, and
attached as Schedule 4.11(b) is written confirmation from the Borrower's actuary
regarding the approximate present value of the accrued benefits under the CPM
Defined Benefit Plan as of December, 2001. Neither the Borrower nor any Commonly
Controlled Entity
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has had a complete or partial withdrawal from any Multiemployer Plan, and
neither the Borrower nor any Commonly Controlled Entity would become subject to
any liability under ERISA if the Borrower or any such Commonly Controlled Entity
were to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made and no such Multiemployer Plan is in Reorganization or Insolvent,
except in each instance where such liability, reorganization or insolvency could
not reasonably be expected to have a Material Adverse Effect. The present value
(determined using actuarial and other assumptions which are reasonable in
respect of the benefits provided and the employees participating) of the
liability of the Borrower for post-retirement benefits to be provided to its
current and former employees under Plans, other than the CPM Defined Benefit
Plan, that are welfare benefit plans (as defined in Section 3(1) of ERISA) does
not, in the aggregate, exceed the assets under all such Plans allocable to such
benefits by an amount which could reasonably be expected to have a Material
Adverse Effect. Each Commonly Controlled Entity that has liability for
post-retirement benefits has adopted Financial Accounting Standard No. 106.
4.12 Investment Company Act; Other Regulations. The Borrower is not an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940 as amended. The
Borrower is not subject to regulation under any federal or state statute or
regulation which limits its ability to incur Indebtedness.
4.13 Subsidiaries. The Persons listed on Schedule 4.13 constitute all
the foreign and domestic Subsidiaries of the Borrower at the date hereof. Such
schedule identifies the state or country of incorporation of each such
Subsidiary and, if such Subsidiary is not a direct wholly-owned Subsidiary of
the Borrower, the percentage ownership of such Subsidiary directly or indirectly
owned by the Borrower and the ownership chain for such Subsidiary.
4.14 Environmental Matters. (a) (a) Except as disclosed on Schedule
4.14, no real estate currently owned or leased by the Borrower or any or its
Subsidiaries, to the best of the Borrower's knowledge, contains any Materials of
Environmental Concern in amounts or concentrations which could reasonably be
expected to give rise to a material liability under any Environmental Law.
(b) Except as disclosed in Schedule 4.14, to the best of the Borrower's
knowledge, all real estate currently owned or leased by the Borrower and its
Subsidiaries and all operations thereon are in material compliance with all
applicable Environmental Laws, and to the best of the Borrower's knowledge,
there is no contamination at, under or about such real estate or violation of
any Environmental Law with respect to such real estate or the business operated
by any Loan Party (the "Business") which could reasonably be expected to have a
Material Adverse Effect or interfere with the continued operation of such real
estate.
(c) Except as disclosed in Schedule 4.14, there are no existing or
potential Environmental Claims against the Borrower or any of its Subsidiaries,
and neither the Borrower nor any of its Subsidiaries has received any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the real estate currently owned, leased or operated by
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the Borrower or any of its Subsidiaries or the Business which could reasonably
be expected to have a Material Adverse Effect.
(d) To the best of the Borrower's knowledge, no judicial proceeding or
governmental or administrative action is pending or, to the knowledge of the
Borrower, threatened under any Environmental Law to which any Loan Party is or
will be named as a party with respect to any real estate currently owned, leased
or operated by the Borrower or any of its Subsidiaries or the Business which
could reasonably be expected to have a Material Adverse Effect, nor are there
any consent decrees or other decrees, consent orders, administrative orders or
other orders, or other administrative or judicial requirements outstanding under
any Environmental Law with respect to such real estate or the Business which
could reasonably be expected to have a Material Adverse Effect.
(e) No matter disclosed on Schedule 4.14 nor any aggregation of such
matters could reasonably be expected to have a Material Adverse Effect.
4.15 Indebtedness. Pursuant to the Plan of Reorganization, as of the
Closing Date, the amount of unsecured pre-petition indebtedness outstanding is
as set forth on Schedule 4.15.
4.16 Intentionally Omitted.
4.17 Intentionally Omitted.
4.18 Insurance. Schedule 4.18 lists all insurance maintained by the
Loan Parties as of the Closing Date.
4.19 Intentionally Omitted.
4.20 Labor Relations. Neither the Borrower nor to the best knowledge of
the Borrower, any of its Active Subsidiaries is engaged in any unfair labor
practice that could reasonably be expected to have a Material Adverse Effect and
there is (i) no unfair labor practice complaint pending against the Borrower or
to the best knowledge of the Borrower, any of its Active Subsidiaries or, to the
best knowledge of the Borrower, threatened against any of them, before the
National Labor Relations Board, and no material grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against the Borrower or to the best knowledge of the Borrower, any of
its Active Subsidiaries or, to the best knowledge of the Borrower, threatened
against any of them, (ii) no strike, labor dispute, slow down or stoppage
pending against the Borrower or to the best knowledge of the Borrower, any of
its Active Subsidiaries or, to the best knowledge of the Borrower, threatened
against the Borrower or any of its Active Subsidiaries and (iii) to the best
knowledge of the Borrower, no union representation proceeding is pending with
respect to the employees of the Borrower or any of its Active Subsidiaries,
except (with respect to any matter specified in clause (i), (ii) or (iii) above,
either individually or in the aggregate) such as could not reasonably be
expected to have a Material Adverse Effect.
4.21 Intentionally Omitted.
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4.22 Bank Accounts. Schedule 4.22 (as the same may be updated pursuant
to the provisions of subsection 6.14 after the Closing Date) sets forth a true
and complete list of all accounts of whatever nature maintained with a bank or
other financial institution by each of the Borrower and its Subsidiaries (the
"Domestic and Foreign Bank Accounts").
4.23 Intentionally Omitted.
4.24 Intentionally Omitted.
SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Loans. The agreement of each Lender to enter into
this Agreement on the Closing Date is subject to the satisfaction, immediately
prior to or concurrently with the Closing Date, of the following conditions
precedent:
(a) Loan Documents. The Agent shall have received (i) this Agreement,
executed and delivered by a duly authorized officer of the Borrower, with a
counterpart for each Lender, (ii) for the account of each applicable Lender, a
Term Note and/or Letter of Credit Note conforming to the requirements hereof and
executed by a duly authorized officer of the Borrower, (iii) each of the Pledge
Agreements, each executed and delivered by a duly authorized officer of each
Loan Party thereto, with a counterpart for the Agent and a counterpart or a
conformed copy for each Lender, (iv) each of the Guarantees, each executed and
delivered by a duly authorized officer of each Loan Party thereto, with a
counterpart for the Agent and a counterpart or a conformed copy for each Lender,
(v) each of the Security Agreements, each executed and delivered by a duly
authorized officer of each Loan Party party thereto, with a counterpart for the
Agent and a counterpart or a conformed copy for each Lender, (vi) each of the
Mortgages covering the Mortgaged Properties listed on Schedule II, each executed
and delivered by a duly authorized officer of each Loan Party party thereto,
with a counterpart for the Agent and a counterpart or a conformed copy for each
Lender, (vii) each of the Leasehold Mortgages covering the leased properties
listed on Schedule III, each executed and delivered by a duly authorized officer
of each Loan Party party thereto, with a counterpart for the Agent and a
counterpart or a conformed copy for each Lender, and (viii) bank agency
agreements with all domestic banks where the Borrower and /or any of its
Subsidiaries have an account and foreign banks (to the extent permitted by
applicable law) where Borrower and/or any of its Subsidiaries have an account,
duly executed by such banks and the Borrower and in form and substance
satisfactory to Agent.
(b) Entry of Confirmation Order. The Bankruptcy Court shall have
entered the Confirmation Order, which Order shall be in form and substance
satisfactory to the Required Lenders.
(c) Effectiveness of Plan of Reorganization. The Effective Date shall
have occurred and the Confirmation Order shall be final, non-appealable, valid,
subsisting and continuing and, all conditions precedent to the effectiveness of
the Plan of Reorganization shall have been fulfilled.
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(d) Financial Statements. The Agent shall have received the financial
statements required to be delivered pursuant to subsections 4.1(a) and (b), as
well as the unaudited consolidated and consolidating balance sheets of the
Borrower and its consolidated Subsidiaries as at the end of September, 2001, and
October, 2001, and the related unaudited consolidated and consolidating
statements of income of the Borrower and its consolidated Subsidiaries for such
months and for the portion of the year through the end of such months, as
further described in subsection 6.1(c)(i).
(e) Closing Certificate. The Agent shall have received, with a
counterpart for each Lender, a certificate of the Borrower, dated the Closing
Date, substantially in the form of Exhibit H, with appropriate insertions and
attachments, reasonably satisfactory in form and substance to the Agent,
executed by a Responsible Officer and the Secretary or any Assistant Secretary
of the Borrower.
(f) Corporate Proceedings of the Borrower. The Agent shall have
received, with a counterpart for each Lender, a copy of the resolutions, in form
and substance reasonably satisfactory to the Agent, of the Board of Directors of
the Borrower authorizing (i) the execution, delivery and performance of (w) this
Agreement and the other Loan Documents to which it is a party, (x) the
execution, delivery and performance of the Plan of Reorganization and the
consummation of the Plan of Reorganization, and (ii) the granting by it of the
Liens created pursuant to the Borrower Security Documents, certified by the
Secretary or an Assistant Secretary of the Borrower as of the Closing Date,
which certificate shall be in form and substance reasonably satisfactory to the
Agent and shall state that the resolutions thereby certified have not been
amended, modified, revoked or rescinded.
(g) Borrower Incumbency Certificate. The Agent shall have received,
with a counterpart for each Lender, a certificate of the Borrower, dated the
Closing Date, as to the incumbency and signature of the officers of the Borrower
executing any Loan Document, reasonably satisfactory in form and substance to
the Agent, executed by a Responsible Officer and the Secretary or any Assistant
Secretary of the Borrower.
(h) Corporate Proceedings of Subsidiaries. The Agent shall have
received, with a counterpart for each Lender, a copy of the resolutions, in form
and substance reasonably satisfactory to the Agent, of the Board of Directors of
each Subsidiary of the Borrower which is a party to a Loan Document authorizing
(i) the execution, delivery and performance of the Loan Documents to which it is
a party and (ii) the granting by it of the Liens created pursuant to the
Subsidiary Security Documents to which it is a party, certified by the Secretary
or an Assistant Secretary of each such Subsidiary as of the Closing Date, which
certificate shall be in form and substance reasonably satisfactory to the Agent
and shall state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded.
(i) Subsidiary Incumbency Certificates. The Agent shall have received,
with a counterpart for each Lender, a certificate of each Subsidiary of the
Borrower which is a Loan Party, dated the Closing Date, as to the incumbency and
signature of the officers of such Subsidiaries executing any Loan Document,
reasonably satisfactory in form and substance to the Agent, executed by a
Responsible Officer and the Secretary or any Assistant Secretary of each such
Subsidiary Corporate Documents.
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(j) Corporate Documents. The Agent shall have received, with a copy for
each Lender, true and complete copies of the certificate of incorporation and
by-laws of the Borrower and each Active Subsidiary, certified as of the Closing
Date as complete and correct copies thereof by the Secretary or an Assistant
Secretary of such Loan Party.
(k) Filings. All filings and other actions required to create and
perfect a first priority security interest in favor of the Agent for the benefit
of the Lenders on all Collateral owned or to be owned by the Borrower and its
Subsidiaries, including, but not limited to, the real property located on Wharf
Way, Glen Parva, Leicestershire, England, shall have been duly made or taken,
and all such Collateral shall be free and clear of other Liens except Liens
permitted under the Loan Documents. To the extent that all filings and other
actions required to create and perfect a first priority security interest in the
Collateral are not made or taken on or prior to the Closing Date, the Agent and
the Lenders shall be reasonably satisfied that the filings or other actions made
or taken on or prior to the Closing Date are sufficient to give the Lenders the
practical benefit of the Collateral and that all other filings and other actions
which have not been made or taken on or prior to the Closing Date will be
completed as soon as practicable after the Closing Date.
(l) Compliance Certificate. The Agent shall have received, with a copy
for each Lender, a certificate of the Borrower, dated the Closing Date,
substantially in the form of Exhibit J, with appropriate insertions and
attachments, reasonably satisfactory in form and substance to the Agent,
executed by a Responsible Officer and the Secretary or an Assistant Secretary of
the Borrower.
(m) Pledged Stock; Stock Powers. The Agent shall have received the
certificates representing the shares pledged pursuant to each of the Pledge
Agreements, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the pledgor thereof (or, in
the case of the Foreign Subsidiaries, the applicable action required to perfect
the Agent's pledge shall have been taken).
(n) Title Insurance Policy. The Agent shall have received in respect of
each parcel covered by each Mortgage to be delivered on the Closing Date a
mortgagee's title policy (or policies) or marked up unconditional binder for
such insurance dated the Closing Date, provided, however, that a title policy or
binder shall not be required for parcels located in England and registered with
"title absolute" at HM Land Registry. Each such policy shall (i) be in an amount
set forth on Schedule 5.1(n), not to exceed the fair market value of such
parcel; (ii) be issued at ordinary rates; (iii) insure that the Mortgage insured
thereby creates a valid first Lien on such parcel free and clear of all defects
and encumbrances, except as set forth in Schedule 4.7; (iv) name the Agent for
the benefit of the Lenders as the insured thereunder; (v) be in the form of ALTA
Loan Policy; (vi) contain such endorsements and affirmative coverage as the
Agent may request and (vii) be issued by title companies reasonably satisfactory
to the Agent (including any such title companies acting as co-insurers or
reinsurers, at the option of the Agent). The Agent shall have received evidence
reasonably satisfactory to it that all premiums in respect of each such policy,
and all charges for mortgage recording tax, if any, have been paid.
(o) Workers Compensation Insurance and Fire Insurance. The Agent shall
have received supporting information (including but not limited to copies of the
underlying
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insurance policies) in form and substance satisfactory to it regarding the
following Unexpired Letters of Credit:
(i) Irrevocable Standby Letter of Credit, Number 961121IS626,
issued by Credit Lyonnais New York Branch on behalf of the Borrower for
the benefit of Insurance Company of the State of Pennsylvania (in
connection with the Borrower's workers compensation insurance
obligations); and
(ii) Irrevocable Standby Letter of Credit, Number 961209S655,
issued by Credit Lyonnais New York Branch on behalf of the Borrower for
the benefit of National Union Fire Insurance Company of Pittsburgh and
such other beneficiaries as may be listed therein.
(p) Copies of Documents. The Agent shall have received a copy of all
recorded documents referred to, or listed as exceptions to title in, the title
policy or policies referred to in subsection 5.1(n) and listed on Schedule 4.7
and a copy, certified by such parties as the Agent may reasonably deem
appropriate, of all other documents affecting the property covered by each
Mortgage to be delivered on the Closing Date.
(q) Insurance. The Agent shall have received evidence in form and
substance reasonably satisfactory to it that all of the requirements of
subsection 6.5, Section 4.1 of each of the Security Agreements and Section 1.3
or paragraphs 2 and 10 of each of the Mortgages shall have been satisfied.
(r) Legal Opinion. The Agent shall have received, with a counterpart
for each Lender, executed legal opinions of counsel to the Borrower and the
domestic Active Subsidiaries, substantially in the form attached hereto as
Exhibit I.
(s) Bank Agency Agreements. The Agent shall have received duly executed
back agency agreements pursuant to subsection 6.14.
(t) Professional Fees; Agency Fee. The Agent shall have received from
the Borrower $40,000 to defray professional fees incurred by the Agent, as well
as $75,000 to cover the annual agency fee pursuant to subsection 3.8.
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, from and after the Closing Date, so
long as any Loan remains outstanding and unpaid or any other amount is owing to
any Lender or the Agent hereunder unless the Required Lenders shall have
otherwise consented in writing, the Borrower shall and (except in the case of
delivery of financial information, reports and notices) shall cause each of its
Active Subsidiaries to:
6.1 Financial Statements. Furnish to the Agent, with a copy for each
Lender:
(a) as soon as available, but in any event within 90 days after the end
of each fiscal year of the Borrower, including the fiscal year ending September
30, 2001, a copy of the
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consolidated and consolidating balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such year and the related
consolidated and consolidating statements of income and retained earnings and of
cash flows for such year, setting forth in each case in comparative form the
figures for the previous year, reported on (other than with respect to
consolidating statements) (the "Year-End Financials") without a "going concern"
or like qualification or exception, or qualification arising out of the scope of
the audit, by Moore Stephens Lovelace, P.A., or other independent certified
public accountants of nationally recognized standing acceptable to the Agent;
provided, however, that delivery of such Year-End Financials with a "going
concern" or like qualification or exception, or qualification arising out of the
scope of the audit, in and of itself will not constitute an Event of Default
under this Agreement but will give rise to the Agent's right to conduct field
examinations, entirely at the Borrower's expense, as provided by subsection
3.9(a) hereof.
(b) as soon as available, but in any event not later than 45 days after
the end of each of the first three quarterly periods of each fiscal year of the
Borrower, the unaudited consolidated and consolidating balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such quarter and the
related unaudited consolidated and consolidating statements of income and
retained earnings and of cash flows of the Borrower and its consolidated
Subsidiaries for such quarter and the portion of the fiscal year through the end
of such quarter, setting forth in each case in comparative form the figures for
the previous year, certified by a Responsible Officer as fairly presenting the
financial condition and results of operations of the Borrower and its
consolidated Subsidiaries (subject to normal year-end audit adjustments and the
absence of certain notes); and
(c) as soon as available, but in any event not later than 45 days after
the end of each month, (i) the unaudited consolidated and consolidating balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
month and the related unaudited consolidated and consolidating statements of
income of the Borrower and its consolidated Subsidiaries for such month and the
portion of the year through the end of such month, setting forth in each case in
comparative form the figures for the previous year, certified by a Responsible
Officer as fairly presenting the financial condition and results of operations
of the Borrower and its consolidated Subsidiaries (subject to normal year-end
audit adjustments and the absence of notes); and (ii) a monthly summary of
invoiced sales, aged accounts receivables and accounts payables, customer
deposits and backlog, substantially in the form attached hereto as Schedule
6.1(c)
all such financial statements shall be prepared in accordance with generally
accepted accounting principles (subject, in the case of interim financial
statements, to normal year-end audit adjustments and the absence of certain
notes) applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such accountants or officer, as the case
may be, and disclosed therein).
6.2 Certificates; Other Information. Furnish to the Agent, with a copy
for each Lender:
(a) concurrently with the delivery of the financial statements referred
to in subsection 6.1(a), a written statement of the independent certified public
accountants reporting
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on such financial statements (unless such accountants are prohibited by law or
the Financial Accounting Standards Board (or any successor) from providing such
statement) to the effect that in the course of the audit upon which their
certification of such financial statements was based (but without any special or
additional audit procedures for the purpose) they obtained knowledge of no
condition or event relating to financial matters which constitutes a Default or
an Event of Default or, if such accountants shall have obtained in the course of
such audit knowledge of any Default or Event of Default, disclosing in such
written statement the nature and period of existence thereof, it being
understood that such accountants shall be under no liability, directly or
indirectly, to the Lenders for failure to obtain knowledge of any such condition
or event;
(b) concurrently with the delivery of the financial statements referred
to in subsections 6.1(a) and 6.1(b), a certificate of a Responsible Officer
certifying that, to the best of such Officer's knowledge, each of the Borrower
and its Subsidiaries during such period has observed or performed all of its
covenants and other agreements, and satisfied every condition, contained in this
Agreement and the other Loan Documents to which it is a party to be observed,
performed or satisfied by it, and that such Officer has no knowledge of any
Default or Event of Default except as specified in such certificate;
(c) concurrently with the delivery of the financial statements referred
to in subsections 6.l(a) and 6.1(b), a certificate of a Responsible Officer,
substantially in the form of Exhibit J hereto (the "Compliance Certificate"),
showing in detail satisfactory to the Agent (including, where applicable,
differences in the application of generally accepted accounting principles used
in such financial statements and the application of GAAP) compliance by the
Borrower with the covenants contained in subsections 7.1, 7.3(d), 7.4(c), 7.6,
7.7 and 7.8 hereof and, to the extent not otherwise required to be delivered
pursuant to subsections 6.1 and 6.2, statements of the Borrower's and its
Subsidiaries' quarterly cash flows for the periods covered by such covenants,
with respect to which compliance is to be demonstrated in such Compliance
Certificate, and a computation of the amount of the Borrower's and its
Subsidiaries' capital expenditures made during such period and during the
portion of the fiscal year through the end of the period covered by such
Compliance Certificate;
(d) not later than 30 days after the end of each fiscal year of the
Borrower, subject to the provisions of subsection 10.16, a copy of the
projections by the Borrower of the operating budget and cash flow budget of the
Borrower and its Subsidiaries for the succeeding fiscal year to be accompanied
by a certificate of a Responsible Officer to the effect that such projections
have been prepared in good faith and based upon reasonable assumptions and that
such Officer has no reason to believe they are incorrect or misleading in any
material respect;
(e) within ten days after the same are sent, copies of all financial
statements and other financial information, proxy materials and other
information and reports which the Borrower files with the SEC or any securities
exchange on which the Borrower's common stock is traded or delivers to its
stockholders or to holders of its Indebtedness (or any trustee, agent or other
representative therefor);
(f) promptly after the receipt thereof by the Borrower or any of its
Active Subsidiaries, subject to the provisions of subsection 10.16, a copy of
any "management letter"
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received by any such Person from its certified public accountants and the
management's responses thereto;
(g) promptly upon, and in any event within ten Business Days after, an
officer of the Borrower or any of its Subsidiaries obtains knowledge thereof,
notice of one or more of the following environmental matters, unless such
officer reasonably concludes that such environmental matters would not,
individually or when aggregated with all other such environmental matters, have
a Material Adverse Effect:
(i) any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any real property owned or
operated by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any real
property currently or formerly owned or operated by the Borrower or any
of its Subsidiaries that (a) results in noncompliance by the Borrower
or any of its Subsidiaries with any applicable Environmental Law or (b)
could reasonably be expected to form the basis of an Environmental
Claim against the Borrower or any of its Subsidiaries or any such real
property;
(iii) any condition or occurrence on any real property
currently or formerly owned or operated by the Borrower or any of its
Subsidiaries that could reasonably be expected to cause such real
property to be subject to any restrictions on the ownership, occupancy,
use or transferability by the Borrower or any of its Subsidiaries of
such real property under any Environmental Laws; and
(iv) the taking of any removal or remedial action in response
to the actual or alleged presence of any Materials of Environmental
Concern on any real property currently or formerly owned or operated by
the Borrower or any of its Subsidiaries as required by any
Environmental Law or any governmental or other administrative agency;
provided that in any event the Borrower shall deliver to each Lender
all notices received by it or any of its Subsidiaries from any
government or governmental agency under, or pursuant to, CERCLA;
all such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and the
Borrower's or such Subsidiary's response thereto. In addition, the Borrower will
provide the Lenders with copies of all material communications with any
government or governmental agency relating to Environmental Laws, all
communications with any Person (other than its attorneys) relating to any
Environmental Claim of which notice is required to be given pursuant to this
Section 6.2(g), and such detailed reports (not subject to attorney-client or
attorney work product privileges) of any such Environmental Claim as may
reasonably be requested by the Lenders; and
(h) promptly, such additional financial and other information that is
in the Borrower's possession as any Lender may from time to time reasonably
request through the Agent.
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6.3 Payment of Taxes and Other Obligations. Pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, all of its taxes and other obligations of whatever nature, except where the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings and reserves in conformity with generally accepted
accounting principles with respect thereto have been provided on the books of
the Borrower or its Subsidiaries, as the case may be.
6.4 Conduct of Business and Maintenance of Existence. Continue to
engage in business of the same general type as now conducted by the Borrower and
its Active Subsidiaries and preserve, renew and keep in full force and effect
its corporate existence and take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business except as otherwise permitted pursuant to subsection 7.5; comply with
all Requirements of Law, including, without limitation, the Confirmation Order,
the Plan of Reorganization and any indenture, agreement or other instrument to
which any Loan Party is a party or by which it or any of its property is bound
which is material to the Borrower and its Active Subsidiaries taken as a whole,
except to the extent that failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
6.5 Maintenance of Property Insurance. Keep all property useful and
necessary in its business in good working order and condition, normal wear and
tear excepted; maintain with financially sound and reputable insurance companies
insurance on all its property in at least such amounts and against at least such
risks (but including in any event public liability and business interruption) as
are usually insured against in the same general area by companies engaged in the
same or a similar business; and furnish to each Lender which so requests, upon
reasonable written request, full information as to the insurance carried.
6.6 Inspection of Property, Books and Records; Discussions. Keep proper
books of records and account in conformity with generally accepted accounting
principles and applicable regulatory standards; and permit representatives of
any Lender to visit and inspect any of its properties and examine and make
abstracts from any of its books and records at any reasonable time upon
reasonable prior notice and as often as may be reasonably required and to
discuss the business, operations, properties and financial and other condition
of the Borrower and its Subsidiaries with officers of the Borrower and its
Subsidiaries.
6.7 Notices. Promptly give written notice to the Agent and each Lender
of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any indenture, agreement
or other instrument to which the Borrower or any Active Subsidiary is a party or
by which it or any of its property is bound which is material to the Borrower
and its Active Subsidiaries taken as a whole, or (ii) litigation, investigation
or proceeding which may exist at any time between the Borrower or any Active
Subsidiary on the one hand and any Governmental Authority on the other, which in
either case of clauses (i) or (ii) of this paragraph (b), if not cured or if
adversely determined, as the case may be, could reasonably be expected to have a
Material Adverse Effect;
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(c) any litigation or proceeding affecting any Loan Party in which the
amount involved is $250,000 or more and not covered by insurance or in which
injunctive or similar relief is sought;
(d) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any
lien (within the meaning of Section 4068 of ERISA) in favor of the PBGC or a
Plan or any withdrawal from, or the termination, Reorganization or Insolvency
of, any Multiemployer Plan or (ii) the institution of proceedings or the taking
of any other action by the PBGC or the Borrower or any Commonly Controlled
Entity or any Multiemployer Plan with respect to the withdrawal from, or the
terminating, Reorganization or Insolvency of, any Plan;
(e) any development or event which in the reasonable judgment of the
Borrower has had or could reasonably be expected to have a Material Adverse
Effect or a material adverse effect on the prospects of the Borrower and its
Active Subsidiaries taken as a whole;
(f) any Environmental Claim asserted by any Governmental Authority or
third party or any discovery by Borrower or any Subsidiary of any occurrence or
condition with respect to any Material of Environmental Concern that is
reasonably likely to involve remediation costs or liability greater than
$250,000; and
Each notice pursuant to the foregoing paragraphs of this subsection shall be
accompanied by a statement of a Responsible Officer setting forth details of the
occurrence referred to therein and stating what action the Borrower proposes to
take with respect thereto.
6.8 Environmental Law. (a) Comply in all material respects with, and
ensure compliance in all material respects by all tenants and subtenants, if
any, with, all applicable Environmental Laws and obtain and comply in all
material respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws.
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws (the "Remedial Work") and promptly comply in all material
respects with all lawful orders and directives of all Governmental Authorities
regarding Environmental Laws except to the extent that the same are being
contested in good faith and with due diligence by appropriate proceedings and
the pendency of such proceedings could not reasonably be expected to have a
Material Adverse Effect and reserves in conformity with generally accepted
accounting principles with respect thereto have been provided on the books of
the Borrower or the applicable Active Subsidiary as the case may be.
(c) If the Borrower or any of its Active Subsidiaries does not timely
commence and diligently prosecute to completion the Remedial Work, and is not
contesting the
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need to perform Remedial Work as provided in Section 6.8(b) above, the Agent may
(but shall not be obligated to), upon 30 days prior written notice to the
Borrower of its intention to do so, cause such Remedial Work to be performed.
The Borrower shall pay or reimburse the Agent on demand for all expenses
(including attorneys' fees and disbursements), reasonably relating to or
incurred by the Agent in connection with monitoring, reviewing or performing any
Remedial Work.
6.9 Maintenance of Liens of the Security Documents. Promptly, upon the
reasonable request of the Agent, at the Borrower's expense, execute, acknowledge
and deliver, or cause the execution, acknowledgement and delivery of, and
thereafter register, file or record, or cause to be registered, filed or
recorded, in an appropriate governmental office, any document or instrument
supplemental to or confirmatory of the Security Documents or otherwise
reasonably deemed by the Agent necessary or desirable for the continued
validity, perfection and priority of the Liens on the Collateral covered
thereby.
6.10 Pledge of After Acquired Property. If at any time following the
Closing Date the Borrower or any of its Subsidiaries shall acquire at any time
property of any nature whatsoever which is intended to be covered by the terms
of the applicable Security Document and is not otherwise subject to the Lien
created by each Security Document as soon as possible and in no event later than
30 days after the relevant acquisition date and, to the extent permitted by
applicable law, grant to the Agent for the ratable benefit of the Lenders a
first priority Lien on such property as collateral security for the Obligations
(as defined in the Borrower Security Agreement) pursuant to documentation
reasonably satisfactory in form and substance to the Agent. The Borrower, at its
own expense, shall execute, acknowledge and deliver, or cause the execution,
acknowledgement and delivery of, and thereafter register, file or record in an
appropriate governmental office, any document or instrument (including legal
opinions, title insurance, consents and corporate documents) and take all such
actions reasonably deemed by the Agent to be necessary or desirable to ensure
the creation, priority and perfection of such Lien. The Borrower shall cause
each New Subsidiary of the Borrower created or acquired after the date hereof,
immediately upon such creation or acquisition, to execute a Subsidiary Security
Agreement and an instrument in form and substance reasonably satisfactory to the
Agent pursuant to which such New Subsidiary shall become a party to the
Subsidiaries' Guarantee as a guarantor thereunder, and the Borrower shall
execute and deliver a Supplement to the Borrower Pledge Agreement in form and
substance reasonably satisfactory to the Agent, or shall cause the Subsidiary of
the Borrower which holds the Capital Stock of such New Subsidiary to execute and
deliver a Subsidiary Pledge Agreement or a Supplement to the Subsidiary Pledge
Agreement to which it is a party, providing for the pledge of 100% of the issued
and outstanding Capital Stock of such New Subsidiary to the Agent for the
benefit of the Lenders (65% in the case of a New Foreign Subsidiary), and the
Borrower shall deliver to the Agent the stock certificates evidencing such
Capital Stock together with undated stock powers for each such certificate, duly
executed in blank (or, in the case of a New Foreign Subsidiary, take such other
action as has the same substantive effect under applicable law).
6.11 Accuracy of Information. Assure that (a) the written information
relating to the Borrower and its Subsidiaries and (b) the information contained
in any and all filings made by the Borrower with the SEC (collectively, the
"Information") will be, as of the date such
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Information is given or filed or the dates otherwise specified therein, accurate
in all material respects and will not contain any untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein
not misleading.
6.12 Foreign Subsidiaries Security. If following a change in the
relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronouncements issued or promulgated thereunder, counsel for the
Borrower reasonably acceptable to the Agent and the Required Lenders does not
within 30 days after a request from the Agent or the Required Banks deliver
evidence, in form and substance reasonably satisfactory to the Agent and the
Required Lenders, with respect to any Foreign Subsidiary that has not already
had all of its stock pledged pursuant to the applicable Pledge Agreement that a
pledge of 66-2/3% or more of the total combined voting power of all classes of
capital stock of such Foreign Subsidiary entitled to vote, would cause the
undistributed earnings of such Foreign Subsidiary as determined for federal
income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent for federal income tax purposes, then that
portion of such Foreign Subsidiary's outstanding capital stock not theretofore
pledged pursuant to such Pledge Agreement shall be pledged to the Agent for the
benefit of the Lenders pursuant to a pledge agreement in form and substance
reasonably satisfactory to the Agent and the Required Lenders, to the extent
that the entering into such pledge agreement is permitted by the laws of the
respective foreign jurisdiction, and with all other related documents to be
delivered pursuant to this Section 6.12 to be in form and substance reasonably
satisfactory to the Agent and the Required Lenders.
6.13 Collateral Account. In the event that the Borrower or any of its
Subsidiaries receives any insurance proceeds on account of Casualty Losses, such
proceeds shall promptly be deposited in a bank account or accounts (the
"Collateral Account") maintained by, and under the control of, the Agent, all as
provided in the Security Agreement. The amounts deposited into the Collateral
Account pursuant to this Section 6.13 shall be released to the Borrower upon
receipt by the Agent of a certificate from the Borrower certifying that such
amounts shall be used immediately upon receipt to repair or replace property
subject to a Casualty Loss. Any Qualifying Insurance and Other Proceeds in the
Collateral Account shall be applied in accordance with Section 3.1(a).
6.14 Bank Accounts. The Borrower and its Subsidiaries shall, at their
expense, take all such actions, or cause such actions to be taken, as are
necessary or desirable in the judgment of the Agent to cause the Agent for the
benefit of the Lenders to have a legal, valid and enforceable fully perfected
security interest of first priority in all of the Domestic and Foreign (to the
extent permitted by applicable law) Bank Accounts of the Borrower and its
Subsidiaries, including the Collateral Account. In this regard the Borrower
shall deliver to the Agent a duly executed bank agency agreement in form and
substance satisfactory to the Agent. If, with respect to Domestic Bank Accounts,
under the laws of any state, the Agent shall not be able to take such a security
interest in a checking or similar account, then the Borrower shall not permit
the account balance in any such account to exceed $50,000 at any time (after
payment of all checks payable on such date) or the account balances in all such
accounts collectively to exceed $250,000 in the aggregate at any time.
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SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, from and after the Closing Date, so
long as any Loan remains outstanding and unpaid or any other amount is owing to
any Lender or the Agent hereunder, unless the Required Lenders shall have
otherwise consented in writing, the Borrower shall not, and (except with respect
to subsection 7.1) shall not permit any of the Borrower's Subsidiaries to,
directly or indirectly:
7.1 Financial Condition Covenants.
EBITDA Maintenance. Permit EBITDA of the Borrower and its Active
Subsidiaries to be less than the quarterly EBITDA targets shown below for the
Borrower and its Active Subsidiaries, tested as of the last day of each of the
Borrower's fiscal quarters, the first such test for the first full fiscal
quarter following the Effective Date:
Fiscal Quarter Ended EBITDA Target ($)
-------------------- -----------------
3/31/02 1,020,000
6/30/02 1,020,000
9/30/02 117,000
12/31/02 961,000
3/31/03 1,778,000
6/30/03 1,778,000
9/30/03 918,000
12/31/03 1,075,000
3/31/04 1,934,000
6/30/04 1,934,000
9/30/04 1,013,000
12/31/04 1,123,000
3/31/05 2,025,000
6/30/05 2,025,000
7.2 Limitation on Indebtedness. With respect to the Borrower or any
Active Subsidiary, create, incur, assume or suffer to exist any Indebtedness,
except:
(a) Indebtedness of the Borrower under this Agreement;
(b) Indebtedness (i) of the Borrower to any Subsidiary and (ii) of any
wholly-owned Domestic Subsidiary of the Borrower to the Borrower or any other
Subsidiary, provided that any such Indebtedness referred to in clause (i) of
this subsection 7.2(b) or of any such wholly-owned Domestic Subsidiary to any
other Subsidiary shall be expressly subordinated to the Loans and the Guarantees
on terms and conditions reasonably satisfactory, in each case to the Agent and
also, in any case where the amount of such Indebtedness is in excess of
$1,000,000, to the Required Lenders and (iii) of any wholly-owned Foreign
Subsidiary of the Borrower to the Borrower not to exceed $50,000 in the case of
any Foreign Subsidiary and not to exceed $250,000 in the aggregate for all
Foreign Subsidiaries; provided that each such Domestic or
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Foreign Subsidiary shall have executed a Note (as defined in the Pledge
Agreements) in favor of the Borrower or such other Subsidiary evidencing such
Indebtedness and such Note has been pledged to the Agent (for the ratable
benefit of the Lenders) pursuant to the applicable Pledge Agreement;
(c) The IRB Indebtedness;
(d) Indebtedness of the Borrower contemplated to be outstanding
pursuant to the Plan of Reorganization after confirmation of such Plan;
(e) The Intercompany Transactional Indebtedness as described in greater
detail in Schedule 7.2(e); and
(f) The SE Banken Loan.
7.3 Limitation on Liens. With respect to the Borrower or any Active
Subsidiary, create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
for the following (collectively, the "Permitted Liens"):
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with generally accepted accounting principles;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's,
lessors', landlords' or other like Liens arising in the ordinary course of
business that are not overdue for a period of more than 60 days or that are
being contested in good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements not to exceed $835,000 in the aggregate, provided that, in the
event the Borrower or any Active Subsidiary makes any such pledge or deposit,
such Person timely shall deliver to the Agent a detailed schedule regarding such
pledge or deposit, including, but not limited to, the amount, the date made, any
expiration or termination dates and such other information as the Agent
reasonably may request;
(d) deposits by Gencor International Ltd. to secure the performance of
bids, trade contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations of
a like nature incurred in the ordinary course of business in an amount not to
exceed twelve percent (12%) of the net sales by Gencor International Ltd. over
the twelve months immediately preceding the date of such deposit, provided that,
Gencor International Ltd. shall deliver to the Agent monthly, with the monthly
reports due pursuant to subsection 6.1(c), a detailed schedule regarding all
such deposits, including, but not limited to, the amount, the date made, any
expiration or termination dates and such other information as the Agent
reasonably may request;
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(e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the Borrower or such Subsidiary;
(f) Liens evidenced by the IRB Documents;
(g) Liens created pursuant to the Security Documents;
(h) any Lien arising by operation of law pursuant to Section 107(1) the
Comprehensive Environmental Response, Compensation and Liability Act, or
pursuant to analogous state law, for costs or damages (i) which are not yet due
(by virtue of a written demand for payment by a Governmental Authority) or (ii)
which are being contested in good faith by appropriate proceedings or (iii)
which are on property that the Borrower or one of its Subsidiaries has
determined to abandon if the sole recourse for such costs or damages is such
property, provided, in any case, that the liability of the Borrower (or the
Subsidiary of the Borrower that directly owns or operates the affected property)
with respect to the matter giving rise to such Lien shall not, in the reasonable
estimate of the Agent (in light of all attendant circumstances, including the
likelihood of contribution by third parties), exceed $200,000 for all such
Liens.
7.4 Limitation on Guarantee Obligations. Create, incur, assume or
suffer to exist any Guarantee Obligation except:
(a) the Guarantees, including any Guarantee Obligations arising under
any rights of contribution thereunder;
(b) guarantees existing on the Closing Date by the Borrower's
Subsidiaries, of the IRB Indebtedness permitted by subsection 7.2(c); or
(c) performance guarantees not to exceed, in the aggregate, twelve
percent (12%) of the net sales of Gencor International Ltd., including any
amounts permitted under subsection 7.3(d) above.
7.5 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, except:
(a) any wholly-owned Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the Borrower shall be the
continuing or surviving corporation) or with or into any one or more
wholly-owned Subsidiaries of the Borrower provided that in each case, after
giving effect to such merger or consolidation, the continuing or surviving
corporation's net worth shall not be less than that of either of the
corporations so consolidated or merged immediately prior to such merger or
consolidation;
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(b) any wholly-owned Subsidiary may sell, lease, transfer or otherwise
dispose of any or all of its assets (upon voluntary liquidation or otherwise) to
the Borrower or any other wholly-owned Domestic Subsidiary of the Borrower that
is a Guarantor;
(c) any Troubled Subsidiary may be dissolved.
7.6 Limitation on Sale of Assets. Convey, sell, lease, assign, transfer
or otherwise dispose of any of its property, business or assets (including,
without limitation, receivables and leasehold interests), whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares
of such Subsidiary's Capital Stock to any Person other than the Borrower or any
wholly-owned Domestic Subsidiary that is a Guarantor, except:
(a) the sale of inventory in the ordinary course of business;
(b) the sale or discount without recourse of accounts receivable
arising in the ordinary course of business in connection with the compromise or
collection thereof, provided the Net Proceeds of such sale or discount are
applied in accordance with subsection 3.1(a);
(c) as permitted by subsection 7.5(b);
(d) Asset Sales, provided that (w) the consideration received for such
Asset Sale is in an amount determined in good faith by the Board of Directors of
the Borrower to be fair and reasonable and such sale is to a person not an
Affiliate of the Borrower or any of its Subsidiaries and (x) the Net Proceeds of
such Asset Sales are applied in accordance with subsection 3.1 and the Agent
(for the benefit of the Lenders) is granted a first priority security interest
in all non-cash proceeds; and provided, further, that neither the Borrower nor
any of its Subsidiaries may sell equity securities issued by any of their
respective Subsidiaries unless, as a result of such sale, neither the Borrower
nor any of its Subsidiaries shall own, directly or indirectly, any interest
whatsoever in the Subsidiary whose equity securities are being sold;
(e) sales of equipment and other property, including leasehold
interests, in the ordinary course of business in an aggregate amount not
exceeding $125,000 in any fiscal year and $500,000 in the aggregate from and
after the Closing Date for all such sales and the proceeds of which are applied
in accordance with subsection 3.1(a); and
(f) the sale, transfer or other disposition of any asset in the
ordinary course of business which is obsolete for its intended use.
7.7 Restricted Payments. Declare or pay any dividend (other than
dividends payable solely in common stock of the Borrower and other than
dividends payable by any Subsidiary to the Borrower, directly or indirectly) on,
or make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any shares of any class of Capital Stock of the Borrower or any
warrants or options to purchase any such Stock, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of the Borrower or
any Subsidiary.
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7.8 Limitation on Capital Expenditures. Make or commit to make (by way
of the acquisition of securities of a Person or otherwise) any Adjusted Capital
Expenditures, except for expenditures in the ordinary course of business not
exceeding, in the aggregate for the Borrower and its consolidated Subsidiaries,
during any fiscal year of the Borrower an amount equal to $600,000.
7.9 Limitation on Investments, Loans and Advances. Make any advance,
loan, extension of credit or capital contribution to, or purchase any stock,
bonds, notes, debentures or other securities of or any assets constituting a
business unit of, or make any other investment in, any Person (collectively,
"Investments"), except:
(a) extensions of trade credit and accounts receivable generated in the
ordinary course of business;
(b) Investments in Cash Equivalents;
(c) The formation of new Subsidiaries provided such Subsidiaries
execute a Guarantee guaranteeing the Borrower's obligations hereunder and
Subsidiary Security Documents in form and substance satisfactory to Agent;
(d) Investments by the Borrower in its wholly-owned Domestic
Subsidiaries and Investments by such Subsidiaries in the Borrower and in other
wholly-owned Domestic Subsidiaries (but only to the extent that all such
Investments in Subsidiaries are evidenced by a promissory note or notes);
provided that no Investment may be made by the Borrower and its Subsidiaries in
any Foreign Subsidiary (other than the purchase of notes evidencing Indebtedness
permitted to be incurred under subsection 7.2(b));
(e) advances on sales commissions made in the ordinary course of
business in an aggregate amount not to exceed $100,000 at anytime outstanding.
7.10 Limitation on Optional Payments and Modifications of Debt
Instruments and Capital Stock. (a) Make any optional payment or prepayment or
any purchase or redemption of any Indebtedness for borrower money (other than
the Loans) or (b) amend, modify or change, or consent or agree to any amendment,
modification or change to any of the terms of any such Indebtedness for borrowed
money (other than any such amendment, modification or change which would extend
the maturity or reduce the amount of any payment of principal thereof or which
would reduce the rate or extend the date for payment of interest thereon) or (c)
amend the Certificate of Incorporation of the Borrower or (d) amend, modify or
change any of the terms of any debt instrument issued by the Borrower or any of
its Subsidiaries in connection with the Plan of Reorganization.
7.11 Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service, with any Affiliate unless
such transaction is (a) otherwise permitted under this Agreement, (b) in the
ordinary course of the Borrower's or such Subsidiary's business and (c) upon
fair and reasonable terms no less favorable to the Borrower or such Subsidiary,
as the case may be, than it would obtain in a comparable arm's-length
transaction with a Person which is not
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an Affiliate, provided that the foregoing restriction shall not apply to the
indemnification of directors of the Borrower and its Subsidiaries in accordance
with customary practice.
7.12 Limitation on Sales and Leasebacks. Enter into any arrangement
with any Person providing for the leasing by the Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by the
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of the Borrower or such Subsidiary.
7.13 Limitation on Changes in Fiscal Year. Permit the fiscal year of
the Borrower to end on a day other than September 30.
7.14 Limitation on Negative Pledge Clauses. Enter into with any Person
any agreement after the Closing Date, other than (a) this Agreement, (b)
operating leases with respect to any leased asset leased, (c) the IRB Documents,
purchase money mortgages or Financing Leases permitted by this Agreement (in
which cases, any prohibition or limitation shall only be effective against the
assets financed thereby), which prohibits or limits the ability of the Borrower
or any of its Subsidiaries to create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired or of any of the Subsidiaries to declare or pay dividends or to make
loans or other advances to the Borrower, directly or indirectly.
7.15 Limitation on Lines of Business. Enter into any business either
directly or through any Subsidiary, except for those businesses in which the
Borrower and its Subsidiaries are engaged on the date of this Agreement and
other similar businesses involving the manufacture of industrial or capital
goods, or which are directly related thereto.
7.16 Limitation on New Bank Accounts. Open any new Bank Account without
the prior written consent of the Agent and without prior written notice to each
of the Lenders.
7.17 Limitation on Issuance of Capital Stock by Subsidiaries. Permit
any direct or indirect Subsidiary of the Borrower to issue or grant any Capital
Stock of such Subsidiary to any Person, other than the Borrower or a
wholly-owned Domestic Subsidiary of the Borrower.
7.18 Limitation on Increases in Officers' and Directors' Compensation.
(i) During the period commencing on the Closing Date and ending on the first
anniversary of the Closing Date, increase the total compensation to individual
officers and directors or permit any Subsidiary to increase such compensation
beyond the compensation payable to such individual officers and directors prior
to the date of the Confirmation Order and (ii) commencing on the first
anniversary of the Closing Date, increase the total compensation to individual
officers and directors or permit any Subsidiary to increase such compensation,
by more than ten percent annually exclusive of stock options resulting in no net
cash outlay by the Borrower or any of its Subsidiaries. The Borrower or its
Subsidiaries may continue to operate existing stock option plans or may
implement new stock option plans only if (I) the exercise of options thereunder
will result in no net cash outlay by the Borrower or any of its Subsidiaries and
(II) the directors, officers and other senior managers who are plan participants
deliver to the Agent for the benefit of the Agent and the Lenders properly
executed personal guarantees of
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negative cash outlays associated with the exercise of such stock options by such
directors, officers and other senior management, the form of such personal
guarantees to be provided to the Borrower by the Agent prior to the Closing
Date, and (III) in the case of implementation of a new stock option plan, the
Borrower or its Subsidiary also delivers to the Agent, with a copy for each
Lender, a copy of the proposed plan.
7.19 Limitation on Ability to Contest Lenders' Liens. Contest or
otherwise dispute the validity or priority of any Lien granted by any Loan Party
to the Lenders pursuant to any of the Security Documents.
7.20 Inventory Limitations. Permit Inventory of the Borrower or any of
its Subsidiaries located at 14800 East Moncrief Place, Aurora, Colorado, to
exceed $400,000 in book value.
7.21 Limitation on Transactions with Troubled Subsidiaries.
Notwithstanding anything herein to the contrary, sell or otherwise transfer any
of its assets to or make any advance, loan, extension of credit or capital
contribution to, or purchase any stock, bonds, notes, debentures or other
securities of or any assets constituting a business unit of, or make any
investment in, any Troubled Subsidiary.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing ("Event of
Default"):
(a) The Borrower shall fail to pay any principal of any Loan when due
in accordance with the terms thereof or hereof, or the Borrower shall fail to
pay any interest on any Loan, or any fee or other amount payable hereunder,
within three Business Days after any such interest, fees or other amount becomes
due in accordance with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made by any Loan
Party other than a Troubled Subsidiary herein or by any Loan Party other than a
Troubled Subsidiary in any other Loan Document or which is contained in any
certificate, document or financial or other statement furnished by it pursuant
to the Loan Documents shall prove to have been false or misleading in any
material respect on or as of the date made or deemed made; or
(c) (i) The Borrower or any Active Subsidiary shall default in the
observance or performance of any agreement or covenant contained in subsection
6.7(a), Section 7 (other than subsections 7.9(a), (b) or (d) or subsection 7.11)
or Section 5 of each of the Stock Pledge Agreements or Sections 4.1 and 4.5 of
each of the Security Agreements or (ii) any Troubled Subsidiary shall take any
willful or intentional action that shall jeopardize the validity of any
Guarantee or the validity or priority of any Lien granted by such Troubled
Subsidiary to the Lenders pursuant to any of the Security Documents; or
(d) The Borrower or any Active Subsidiary shall default in the
observance or performance of any other agreement contained in this Agreement or
any other Loan Document (other than as provided in paragraphs (a) through (c) of
this Section), and such default shall
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continue unremedied for a period of 30 days after notice thereof from the Agent
or any Lender to the Borrower; or
(e) The Borrower or any Active Subsidiary shall (i) default in any
payment of principal of or interest on any Indebtedness (other than the Loans or
the SE Banken Loan) or in the payment of any Guarantee Obligation, beyond the
period of grace, if any, provided in the instrument or agreement under which
such Indebtedness or Guarantee Obligation was created, if the aggregate amount
of the Indebtedness and/or Guarantee Obligations in respect of which such
default or defaults shall have occurred is at least $500,000 in the aggregate;
or (ii) default in the observance or performance of any other agreement or
condition relating to any such Indebtedness or Guarantee Obligation or contained
in any instrument or agreement evidencing, securing or relating thereto, or any
other event (including, without limitation, any mandatory prepayment event)
shall occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Guarantee Obligation (or a trustee or
agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of notice if required, such Indebtedness to become due
(whether by acceleration, mandatory prepayment or otherwise) prior to its stated
maturity or such Guarantee Obligation to become payable; or
(f) (i) Any Loan Party other than a Troubled Subsidiary shall commence
any case, proceeding or other action other than the CPM Bankruptcy (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or any Loan Party other than a Troubled
Subsidiary shall make a general assignment for the benefit of its creditors; or
(ii) there shall be commenced against the Borrower or any Active Subsidiary any
case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) remains undismissed, undischarged or unbonded for a period
of 30 days; or (iii) there shall be commenced against the Borrower or any Active
Subsidiary any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within 30 days from the entry thereof; or (iv) any Loan Party
other then a Troubled Subsidiary shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii), or (iii) above; or (v) any Loan Party other than a
Troubled Subsidiary shall generally not, or shall be unable to, or shall admit
in writing its inability to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with
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respect to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion
of the Required Lenders is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or
(vi) any other similar event or condition shall occur or exist with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could
reasonably be expected to have a Material Adverse Effect; or
(h) One or more judgments or decrees shall be entered against the
Borrower or any Active Subsidiary involving in the aggregate a liability (to the
extent not paid or covered by insurance) of $500,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 60 days from the entry thereof; or
(i) Except upon completion of an Asset Sale in compliance with
subsection 7.6, the Borrower, any Loan Party or any Affiliate of the Borrower or
any Loan Party shall assert that any of the Security Documents or the Lien
created by any of the Security Documents shall cease, for any reason, to be in
full force and effect.
(j) Any Guarantee shall cease, for any reason (except as expressly
provided in such Guarantee), to be in full force and effect or any Guarantor
shall so assert; or
(k) A Change of Control shall have occurred;
(l) The Confirmation Order is revoked or the Confirmation Order or the
Plan of Reorganization is modified without the prior written consent of the
Required Lenders;
(m) The Borrower or any Active Subsidiary shall fail to provide
reasonably requested information to, allow reasonable site access to or
cooperate fully with the Agent's Accountant or the appraisers selected by the
Agent to perform the field examinations and/or appraisals described in
subsection 3.9 above; or
(n) Any event shall occur which constitutes a default or with notice,
passage of time or both would constitute a default (subject to any applicable
grace period) under the Plan of Reorganization;
then, and in any such event and at any time thereafter during the continuation
of such an Event of Default, (A) if such event is an Event of Default specified
in paragraph (f) above with respect to the Borrower, automatically the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement shall immediately become due and payable, and (B) if such event is any
other Event of Default, the following action may be taken: with the consent of
the Required Lenders, the Agent may, or upon the request of the Required
Lenders, the Agent shall, by written notice to the Borrower declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement to be due and payable forthwith,
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whereupon the same shall immediately become due and payable. Except as expressly
provided above in this Section 8, presentment, demand, protest and all other
notices of any kind are hereby expressly waived. Notwithstanding anything herein
to the contrary, any event that occurred prior to the date hereof and that,
under the Original Credit Agreement, may have constituted an Event of Default
(as defined in the Original Credit Agreement) by a Troubled Subsidiary shall not
be deemed an Event of Default hereunder or under any other Loan Document;
provided, however, that (i) the Agent, the Lenders and the Issuing Bank shall
not be deemed to have waived any of their rights, remedies, powers or privileges
as against such Troubled Subsidiaries, under the Original Credit Agreement or
the Loan Documents executed in connection therewith, arising from any such
event; and (ii) for purposes of the provisions contained in this sentence only,
the Original Credit Agreement and the Loan Documents executed in connection
therewith shall be deemed to survive with respect to the Troubled Subsidiaries
only (and the Borrower and Active Subsidiaries shall be treated as neither
parties thereto nor bound thereby) concurrently with this Agreement, despite the
execution and effectiveness of this Agreement; and provided that upon filing of
Articles of Dissolution, Articles of Merger or any other instrument that
terminates the corporate existence of a Troubled Subsidiary, such Subsidiary
shall be released entirely from, and no longer subject to, the Original Credit
Agreement; provided, however, that nothing herein shall be construed as in any
way limiting the Agent's continued efforts to foreclose on the property of any
Troubled Subsidiary, and Gencor and each Active Subsidiary agrees to cooperate
with the Agent in its efforts to foreclose upon such property.
SECTION 9. THE AGENT
9.1 Appointment. Each Lender hereby irrevocably designates and appoints
Credit Lyonnais New York Branch as the Agent of such Lender under this Agreement
and the other Loan Documents, and each such Lender irrevocably authorizes Credit
Lyonnais New York Branch, as the Agent for such Lender, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Agent by the terms of this Agreement and the other Loan Documents,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, or 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.
9.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement and the other Loan Documents by or through agents 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 agents or attorneys in-fact selected by it with
reasonable care.
9.3 Exculpatory Provisions. Neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or any other Loan Document (except
for its or such Person's own gross negligence or
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willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or 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 for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Agent shall not 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 the Borrower.
9.4 Reliance by Agent. The Agent shall be entitled to rely, and shall
be fully protected in relying, upon any Note, writing, resolution, notice,
consent, certificate, affidavit, letter, telecopy, telex or teletype message,
statement, order 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, without
limitation, counsel to the Borrower), independent accountants and other experts
selected by the Agent. The Agent shall treat the payee of any Note as the owner
thereof for all purposes unless the assignment or transfer shall have been
recorded in the Register. 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 or 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 and the other Loan Documents in accordance with a request of the
Required Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
9.5 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder unless
the Agent has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". In the event that the Agent receives such a
notice, the Agent shall promptly give notice thereof to the Lenders. The Agent
shall take such action with respect to such Default or Event of Default as shall
be reasonably directed by the Required Lenders; provided that unless and until
the Agent shall have received such directions, 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 in the best
interests of the Lenders.
9.6 Non-Reliance on Agent and Other Lenders. Each Lender expressly
acknowledges that neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to it and that no act by the Agent hereinafter taken, including
any review of the affairs of the Borrower, shall be deemed to constitute any
representation or warranty by the Agent to any Lender. Each Lender represents to
the Agent that it has, independently and without reliance upon the Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own
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appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and made its
own decision to enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon 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 analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Borrower. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Borrower which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.
9.7 Indemnification. The Lenders agree to indemnify the Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Loan Percentages in effect on the date on which indemnification is
sought under this subsection (or, if indemnification is sought after the date
the Loans shall have been paid in full, ratably in accordance with their Loan
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the notes)
be imposed on, incurred by or asserted against the Agent in any way relating to
or arising out of this Agreement, any of the other Loan Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent under
or in connection with any of the foregoing; provided that no Lender shall be
liable for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Agent's gross negligence or willful misconduct (as
determined in a final, non-appealable judgment by a court of competent
jurisdiction). The agreements in this subsection shall survive the payment of
the Notes and all other amounts payable hereunder.
9.8 Agent in Its Individual Capacity. The Agent and its Affiliates may
make loans to, accept deposits from and generally engage in any kind of business
with the Borrower as though the Agent were not the Agent hereunder and under the
other Loan Documents. With respect to its Loans made or renewed by it, the Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Agent, and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
9.9 Successor Agent. The Agent may resign as Agent upon 30 days'
written notice to the Lenders. If the Agent shall resign as Agent under this
Agreement and the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, whereupon such
successor agent shall succeed to the rights, powers and duties of the Agent, and
the term "Agent" shall mean such successor agent effective upon such
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appointment and approval, and the former Agent's rights, powers and duties as
Agent shall be terminated, without any other or further act or deed on the part
of such former Agent or any of the parties to this Agreement or any holders of
the Notes. After any retiring Agent's resignation as Agent, the provisions of
this subsection shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement and the other Loan
Documents.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any Note or any
other Loan Document, nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions of this
subsection. The Required Lenders may, with the consent of the Agent, or, with
the written consent of the Required Lenders, the Agent may, from time to time,
(a) enter into with the Borrower written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of the Borrower hereunder or thereunder or
(b) waive, on such terms and conditions as the Required Lenders or the Agent, as
the case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan or of any installment thereof, or reduce the stated
rate of any interest or fee payable hereunder or extend the scheduled date of
any payment thereof, in each case without the consent of each Lender affected
thereby, (ii) amend, modify or waive any provision of subsection 2.2 or 10.1 or
reduce the percentage specified in the definition of Required Lenders, or
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement and the other Loan Documents or release all or
substantially all of the Collateral in each case without the written consent of
all the Lenders, (iii) amend, modify or waive any provision of Section 2 or the
order of application of prepayments in subsection 3.1 without the written
consent of the Required Lenders, (iv) amend, modify or waive any provision of
Section 9 without the written consent of the then Agent (provided that the
rights of any prior Agent or Agents shall not be adversely affected thereby).
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Borrower, the
Lenders, and the Agent. In the case of any waiver, the Borrower, the Lenders,
and the Agent shall be restored to their former position and rights hereunder
and under the outstanding Notes and any other Loan Documents, and any Default or
Event of Default waived shall be deemed to be cured and not continuing; but no
such waiver shall extend to any subsequent or other Default or Event of Default,
or impair any right consequent thereon.
10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or five Business Days after
being deposited in the mail, postage prepaid, or, in the case of telecopy
notice, when received, addressed as follows in the case of the Borrower and the
Agent, and as set forth in Schedule IA in the case of the other parties hereto,
or to such other address as may be hereafter notified by the respective parties
hereto and any future holders of the Notes:
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The Borrowers: Gencor Industries, Inc.
5201 North Orange Blossom Trail
Orlando, Florida 32810
Attention: John E. Elliott
Telecopy: (407) 299-8241
Telephone: (407) 290-6000
With a copy to: Pachulski Stang Ziehl Young & Jones
10100 Santa Monica Boulevard
Suite 1100
Los Angeles, California 90067
Attention: Brad R. Godshall, Esq.
Telecopy: (310) 201-0760
Telephone: (310) 277-6910
The Agent: Credit Lyonnais New York Branch
1301 Avenue of the Americas
New York, New York 10019
Attention: Anne G. Shean
Telecopy: (212) 261-3259
Telephone: (212) 261-7097
And
Credit Lyonnais New York Branch
1301 Avenue of the Americas
New York, New York 10019
Attention: Mark Koneval
Telecopy: (212) 261-3375
Telephone: (212) 261-7867
provided that any notice, request or demand to or upon the Agent or the Lenders
pursuant to subsection 3.1 or 3.4 shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Lender, any right, remedy,
power or privilege hereunder or under the other Loan Documents shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or
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statement delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement.
10.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Agent for all its out-of-pocket costs and expenses, including
legal fees, incurred in connection with the preparation and execution of any
further amendment, supplement, modification or waiver to, this Agreement and the
other Loan Documents and any other documents prepared in connection therewith,
(b) to pay or reimburse each Lender, the Issuing Bank and the Agent for all its
costs and expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the fees and disbursements of counsel
to the Agent, the Issuing Bank and to each Lender, and (c) to pay, indemnify,
and hold each Lender, the Issuing Bank and the Agent harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, documentary stamp, excise and other taxes,
if any, which may be payable or determined to be payable by reason of the
execution and delivery of this Agreement and the other Loan Documents and any
such other documents, or any amendment, supplement or modification of, or any
waiver or consent under or in respect thereof and (d) to indemnify, and hold
each Lender, the Issuing Bank and the Agent and their respective affiliates,
officers, directors, employees, agents and advisors (each, an "Indemnified
Party") harmless from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever (including legal fees and other
charges) with respect to the execution, delivery, performance and consummation
of this Agreement, the other Loan Documents, the Disputed Letter of Credit and
any such other documents, including, without limitation, any of the foregoing
relating to, or arising out of (i) the preparation for a defense of, or
participation in, any investigation, litigation, proceeding or other action
related to or arising out of the Loan Documents or any other such documents
(whether or not such Indemnified Party is a party to such proceeding or other
action and whether any such investigation, litigation or proceeding or other
action is brought by the Borrower, its stockholders or creditors or by any other
Person) or (ii) the violation of, noncompliance with or liability under, any
Environmental Law applicable to the Borrower, any of its Subsidiaries or any of
the Mortgaged Properties (all the foregoing in this clause (d), collectively,
the "indemnified liabilities"), provided, that the Borrower shall have no
obligation hereunder to an Indemnified Party with respect to indemnified
liabilities arising from the gross negligence or willful misconduct of such
Indemnified Party (as determined in a final non-appealable judgment by a court
of competent jurisdiction). The agreements in this subsection shall survive
repayment of the Loans and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Lenders, the Issuing Bank, the Agent and their respective successors and
assigns, except that the Borrower may not assign or transfer any of its rights
or obligations under this Agreement without the prior written consent of each
Lender.
(b) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or other
entities ("Participants") participating interests in any Loan owing to such
Lender or any other interest of such Lender
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hereunder and under the other Loan Documents. In the event of any such sale by a
Lender of a participating interest to a Participant, such Lender's obligations
under this Agreement to the other parties to this Agreement shall remain
unchanged, such Lender shall remain solely responsible to the other parties for
the performance thereof, such Lender shall remain the holder of any such Loan
for all purposes under this Agreement and the other Loan Documents, and the
Borrower and the Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement and the other Loan Documents. The Borrower also agrees that each
Participant shall be entitled to the benefits of subsections 3.5 and 3.6 with
respect to its participation in the Loans outstanding from time to time as if it
was a Lender.
(c) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time and from time to time assign to any
Lender or any affiliate thereof or, with the consent of the Agent (which shall
not be unreasonably withheld), to another Person (an "Assignee") all or any part
of its rights and obligations under this Agreement and the other Loan Documents
pursuant to an Assignment and Acceptance, substantially in the form of Exhibit
K, executed by such Assignee, such assigning Lender (and, in the case of an
Assignee that is not then a Lender or an affiliate thereof, by the Agent) and
delivered to the Agent for its acceptance and recording in the Register,
provided that, in the case of any such assignment to an additional Assignee, the
sum of the aggregate principal amount of the Loans being assigned and, if such
assignment is of less than all of the rights and obligations of the assigning
Lender, the sum of the aggregate principal amount of the Loans remaining with
the assigning Lender are each not less than $1,500,000. Upon such execution,
delivery, acceptance and recording, from and after the effective date determined
pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder, and (y) the assigning
Lender thereunder shall, to the extent provided in such Assignment and
Acceptance, 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 assigning
Lender shall cease to be a party hereto). Notwithstanding any provision of
paragraph (e) of this subsection, unless requested by the Assignee and/or the
assigning Lender, Notes shall not be required to be executed and delivered by
the Borrower, for any assignment which occurs at any time when any of the events
described in Section 8(f) shall have occurred and be continuing.
(d) The Agent, on behalf of the Borrower, shall maintain at the address
of the Agent referred to in subsection 10.2 a copy of each Assignment and
Acceptance delivered to it and a register (the "Register") for the recordation
of the names and addresses of the Lenders and principal amounts of the Loans
owing to, each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the Agent and
the Lenders shall treat each Person whose name is recorded in the Register as
the owner of a Loan or other obligation hereunder as the owner thereof for all
purposes of this Agreement and the other Loan Documents, notwithstanding any
notice to the contrary. Any assignment of any Loan or other obligation hereunder
shall be effective only upon appropriate entries with respect thereto being made
in the Register. The Register shall be available for inspection by the
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Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or an affiliate thereof, by the Agent) together with payment by
the Assignee or the assigning Lender to the Agent of a registration and
processing fee of $3,500, the Agent shall (i) promptly accept such Assignment
and Acceptance and (ii) on the effective date determined pursuant thereto record
the information contained therein in the Register and give notice of such
acceptance and recordation to the Lenders and the Borrower.
(f) Subject to the provisions of subsection 10.16, the Borrower
authorizes each Lender to disclose to any Participant or Assignee (each, a
"Transferee") and any prospective Transferee any and all financial information
in such Lender's possession concerning the Borrower, its wholly-owned Domestic
Subsidiaries and its Affiliates which has been delivered to such Lender by or on
behalf of the Borrower pursuant to this Agreement or which has been delivered to
such Lender by or on behalf of the Borrower in connection with such Lender's
credit evaluation of the Borrower, its wholly-owned Domestic Subsidiaries and
its Affiliates prior to becoming a party to this Agreement.
(g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Loans and Notes
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank
in accordance with applicable law, provided that no such assignment shall
release a Lender from any of its obligations hereunder.
10.7 Adjustments; Set-off. (a) If any Lender (a "Benefited Lender")
shall at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 8(f), or otherwise), in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Loans, or interest thereon, such Benefited Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such Benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to set
off and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other
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credits, indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or the
account of the Borrower. Each Lender agrees promptly to notify the Borrower and
the Agent after any such set-off and application made by such Lender, provided
that the failure to give such notice shall not affect the validity of such
set-off and application.
10.8 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the Agent.
10.9 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower and the Subsidiaries, the Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties of any party hereto relative to
subject matter hereof not expressly set forth or referred to herein or in the
other Loan Documents. Any previous agreement with respect to the subject matter
hereof is superseded by this Agreement and the other Loan Documents.
10.11 Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
10.12 Submission to Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof,
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
-62-
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to it at its address set
forth in subsection 10.2 or at such other address of which the Agent shall have
been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this subsection any special, exemplary, punitive or consequential damages.
10.13 Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Agent nor any Lender has any fiduciary relationship
with or duty to it arising out of or in connection with this Agreement or any of
the other Loan Documents, and the relationship between Agent and Lenders, on one
hand, and it, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among it and the Lenders.
10.14 Waivers of Jury Trial. THE BORROWER, THE AGENT AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
10.15 Interest Rate Limitation. Notwithstanding anything herein or in
the Notes to the contrary, if at any time the applicable interest rate, together
with all fees and charges which are treated as interest under applicable law
(collectively, the "Charges"), as provided for herein or in any other document
executed in connection herewith, or otherwise contracted for, charged, received,
taken or reserved by any Lender, shall exceed the maximum lawful rate (the
"Maximum Rate") which may be contracted for, charged, taken, received or
reserved by such Lender in accordance with applicable law, the rate of interest
payable under the Note held by such Lender, together with all Charges payable to
such Lender, shall be limited to the Maximum Rate.
10.16 Confidentiality. The Lenders shall hold in confidence all
non-public information obtained pursuant to the requirements of this Agreement,
provided that any Lender may make disclosure (i) reasonably required by any
Transferee or prospective Transferee pursuant to subsection 10.6 (subject to the
execution by such Transferee or prospective Transferee of a confidentiality
letter of the same scope as this subsection 10.16), (ii) as required or
requested by any governmental agency or representative thereof or required by
law, rule or
-63-
regulation, (iii) pursuant to legal process, (iv) to the extent reasonably
required in connection with the exercise of any remedy hereunder, (v) to any
other Person if reasonably necessary to the administration of the Loans or (vi)
of any information that has become public knowledge through no fault or action
by any Lender; provided, further, that in no event shall any Lender be obligated
or required to return any materials furnished by the Borrower.
10.17 Delivery of Documents to the Lenders. Until such time as the
Loans hereunder have been repaid in full, the Agent agrees that it shall deliver
promptly to each Lender a copy of each notice, agreement, document or other
instrument delivered to it by the Borrower in accordance with the terms of any
of the Loan Documents.
[Balance of this page intentionally left blank]
-64-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
GENCOR INDUSTRIES, INC.
By:
--------------------------------------
Name: John E. Elliott
Title: Executive Vice President
-65-
CREDIT LYONNAIS NEW YORK BRANCH,
as Agent, as a Lender and as Issuing Bank
By:
-------------------------------------
Name:
Title:
PB CAPITAL CORPORATION
f/k/a BHF (USA) Capital Corporation
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
BALANCED HIGH-YIELD FUND I, LTD.
By:
-------------------------------------
Name:
Title:
BANK AUSTRIA CREDITANSTALT CORPORATE
FINANCE, INC.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title
THE ING CAPITAL SENIOR SECURED HIGH
INCOME FUND, L.P.
By:
--------------------------------------
Name:
Title:
ING CAPITAL ADVISORS, LLC
By:
--------------------------------------
Name:
Title:
ML CBO IV (CAYMAN) LTD.
By:
--------------------------------------
Name:
Title:
PAMCO CAYMAN LTD.
By:
--------------------------------------
Name:
Title:
SKANDINAVISKA ENSKILDA BANKEN CORPORATION
By:
--------------------------------------
Name:
Title:
ABN AMRO BANK N.V.
By:
--------------------------------------
Name:
Title:
SUNTRUST BANK, a Georgia Banking
Corporation
By:
--------------------------------------
Name:
Title:
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS ........................................... 1
1.1 Defined Terms. ............................................ 1
1.2 Other Definitional Provisions. ............................ 16
SECTION 1.A. RATIFICATION .......................................... 17
1.A.1 Obligations Under Original Credit Agreement. .............. 17
1.A.2 Acknowledgment of Security Interests and Liens. ........... 17
SECTION 2. AMOUNT AND TERMS OF TERM LOANS AND LETTER OF
CREDIT LOANS .......................................... 17
2.1 Term Loans; Letter of Credit Loans. ....................... 17
2.2 Repayment of Term Loans and Letter of Credit Loans;
Limited Repayment Deferral. ............................... 18
2.3 Evidence of Term Loan and Letter of Credit Loan. .......... 18
SECTION 3. GENERAL PROVISIONS APPLICABLE TO LOANS ................ 19
3.1 Prepayments. .............................................. 19
3.2 Interest Rates and Payment Dates. ......................... 20
3.3 Computation of Interest and Fees. ......................... 21
3.4 Pro Rata Treatment and Payments. .......................... 21
3.5 Taxes. .................................................... 21
3.6 Indemnity. ................................................ 24
3.7 Change of Lending Office. ................................. 24
3.8 Annual Agency Fee. ........................................ 24
3.9 Field Examination and Appraisal Fees. ..................... 24
SECTION 3.A RENEWAL OF UNEXPIRED LETTERS OF CREDIT ................ 25
3.A.1 Renewal. .................................................. 25
3.A.2 Participation by Letter of Credit Lenders. ................ 25
3.A.3 Drawings. ................................................. 26
3.A.4 Other Lender. ............................................. 26
3.A.5 Indemnification. .......................................... 26
3.A.6 Liability of the Issuing Bank. ............................ 27
SECTION 3.B DISPUTED LETTER OF CREDIT FACILITY .................... 27
-i-
TABLE OF CONTENTS
(continued)
Page
3.B.1 Acknowledgment. ........................................... 27
3.B.2 Purchase; Assumption. ..................................... 28
3.B.3 Payments Under Disputed Letter of Credit. ................. 28
SECTION 4. REPRESENTATIONS AND WARRANTIES ........................ 28
4.1 Financial Condition. ...................................... 28
4.2 Corporate Existence; Compliance with Law. ................. 29
4.3 Corporate Power, Authorization; Enforceable Obligations. .. 29
4.4 No Legal Bar. ............................................. 30
4.5 No Material Litigation. ................................... 30
4.6 No Default. ............................................... 30
4.7 Ownership of Property; Liens. ............................. 30
4.8 Intellectual Property. .................................... 30
4.9 No Burdensome Restrictions. ............................... 31
4.10 Taxes. .................................................... 31
4.11 ERISA. .................................................... 31
4.12 Investment Company Act; Other Regulations. ................ 32
4.13 Subsidiaries. ............................................. 32
4.14 Environmental Matters. .................................... 32
4.15 Indebtedness. ............................................. 33
4.16 Intentionally Omitted. .................................... 33
4.17 Intentionally Omitted. .................................... 33
4.18 Insurance. ................................................ 33
4.19 Intentionally Omitted. .................................... 33
4.20 Labor Relations. .......................................... 33
4.21 Intentionally Omitted. .................................... 33
4.22 Bank Accounts. ............................................ 34
4.23 Intentionally Omitted. .................................... 34
4.24 Intentionally Omitted. .................................... 34
SECTION 5. CONDITIONS PRECEDENT .................................. 34
5.1 Conditions to Loans. ...................................... 34
SECTION 6. AFFIRMATIVE COVENANTS ................................. 37
-ii-
TABLE OF CONTENTS
(continued)
Page
6.1 Financial Statements. ..................................... 37
6.2 Certificates; Other Information. .......................... 38
6.3 Payment of Taxes and Other Obligations. ................... 41
6.4 Conduct of Business and Maintenance of Existence. ......... 41
6.5 Maintenance of Property Insurance. ........................ 41
6.6 Inspection of Property, Books and Records; Discussions. ... 41
6.7 Notices. .................................................. 41
6.8 Environmental Law. ........................................ 42
6.9 Maintenance of Liens of the Security Documents. ........... 43
6.10 Pledge of After Acquired Property. ........................ 43
6.11 Accuracy of Information. .................................. 43
6.12 Foreign Subsidiaries Security. ............................ 44
6.13 Collateral Account. ....................................... 44
6.14 Bank Accounts. ............................................ 44
SECTION 7. NEGATIVE COVENANTS .................................... 45
7.1 Financial Condition Covenants. ............................ 45
7.2 Limitation on Indebtedness. ............................... 45
7.3 Limitation on Liens. ...................................... 46
7.4 Limitation on Guarantee Obligations. ...................... 47
7.5 Limitation on Fundamental Changes. ........................ 47
7.6 Limitation on Sale of Assets. ............................. 48
7.7 Restricted Payments. ...................................... 48
7.8 Limitation on Capital Expenditures. ....................... 49
7.9 Limitation on Investments, Loans and Advances. ............ 49
7.10 Limitation on Optional Payments and Modifications of Debt
Instruments and Capital Stock. ............................ 49
7.11 Limitation on Transactions with Affiliates. ............... 49
7.12 Limitation on Sales and Leasebacks. ....................... 50
7.13 Limitation on Changes in Fiscal Year. ..................... 50
7.14 Limitation on Negative Pledge Clauses. .................... 50
7.15 Limitation on Lines of Business. .......................... 50
-iii-
TABLE OF CONTENTS
(continued)
Page
7.16 Limitation on New Bank Accounts. .......................... 50
7.17 Limitation on Issuance of Capital Stock by Subsidiaries. .. 50
7.18 Limitation on Increases in Officers' and Directors'
Compensation. ............................................. 50
7.19 Limitation on Ability to Contest Lenders' Liens. .......... 51
7.20 Inventory Limitations. .................................... 51
7.21 Limitation on Transactions with Troubled Subsidiaries. .... 51
SECTION 8. EVENTS OF DEFAULT ..................................... 51
SECTION 9. THE AGENT ............................................. 54
9.1 Appointment. .............................................. 54
9.2 Delegation of Duties. ..................................... 54
9.3 Exculpatory Provisions. ................................... 54
9.4 Reliance by Agent. ........................................ 55
9.5 Notice of Default. ........................................ 55
9.6 Non-Reliance on Agent and Other Lenders. .................. 55
9.7 Indemnification. .......................................... 56
9.8 Agent in Its Individual Capacity. ......................... 56
9.9 Successor Agent. .......................................... 56
SECTION 10. MISCELLANEOUS ......................................... 57
10.1 Amendments and Waivers. ................................... 57
10.2 Notices. .................................................. 57
10.3 No Waiver; Cumulative Remedies. ........................... 58
10.4 Survival of Representations and Warranties. ............... 58
10.5 Payment of Expenses and Taxes. ............................ 59
10.6 Successors and Assigns; Participations and Assignments. ... 59
10.7 Adjustments; Set-off. ..................................... 61
10.8 Counterparts. ............................................. 62
10.9 Severability. ............................................. 62
10.10 Integration. .............................................. 62
10.11 Governing Law. ............................................ 62
10.12 Submission to Jurisdiction; Waivers. ...................... 62
10.13 Acknowledgments. .......................................... 63
-iv-
TABLE OF CONTENTS
(continued)
Page
10.14 Waivers of Jury Trial. .................................... 63
10.15 Interest Rate Limitation. ................................. 63
10.16 Confidentiality. .......................................... 63
10.17 Delivery of Documents to the Lenders. ..................... 64
-v-
SCHEDULES
---------
Schedule IA Term Loan Lenders, Addresses, Term Loan Amounts
and Term Loan Percentages
Schedule IB Letter of Credit Lenders, Letter of Credit Loan
Amounts and Letter of
Credit Loan Percentages
Schedule IC Unexpired Letters of Credit
Schedule II Mortgages
Schedule III Leasehold Mortgages
Schedule 3.1(e) Quarterly Revenue Projections
Schedule 4.3 Filing Offices
Schedule 4.7 Exceptions to Title
Schedule 4.11(a) Notice of Intent to Terminate CPM Defined
Benefit Plan
Schedule 4.11(b) Actuary's Confirmation of CPM Defined Benefit
Plan Information
Schedule 4.13 Subsidiaries
Schedule 4.14 Environmental Matters
Schedule 4.15 Unsecured Pre-petition Indebtedness
Schedule 4.18 Insurance
Schedule 4.22 Bank Accounts
Schedule 5.1(n) Title Insurance Policies
Schedule 6.1(c) Form of Monthly Other Report
Schedule 7.2(e) Intercompany Transactional Indebtedness
EXHIBITS
--------
Exhibit A-1 Form of Amended and Restated Borrower Security
Agreement
Exhibit A-2(a) Form of Amended and Restated Borrower Trademark
Security Agreement
Exhibit A-2(b) Form of Amended and Restated Borrower Patent
Collateral Assignment
Exhibit A-2(c) Form of Amended and Restated Borrower Copyright
Security Agreement
Exhibit B Form of Amended and Restated Borrower Pledge
Agreement
Exhibit C-1 Form of Amended and Restated Mortgage (Florida)
Exhibit C-2 Form of Amended and Restated Mortgage (Iowa)
Exhibit D-1 Form of Acknowledgment and Reaffirmation of
Subsidiaries' Guarantee
Exhibit D-2 Form of Amended and Restated Subsidiaries'
Guarantee
Exhibit E Form of Amended and Restated Subsidiary Pledge
Agreement
Exhibit F-1 Form of Amended and Restated Subsidiary Security
Agreement
-vi-
INITIAL ________
Exhibit F-2(a) Form of Amended and Restated Subsidiary
Trademark Security Agreement
Exhibit F-2(b) Form of Amended and Restated Subsidiary Patent
Collateral Assignment
Exhibit F-2(c) Form of Amended and Restated Subsidiary
Copyright Security Agreement
Exhibit G-1 Form of Term Note
Exhibit G-2 Form of Letter of Credit Note
Exhibit H Form of Closing Certificate
Exhibit I Form of Opinion of Counsel to Borrower
Exhibit J Form of Compliance Certificate
Exhibit K Form of Assignment and Acceptance
-vii-
INITIAL ________
SCHEDULE IA
-----------
Term Loan Lenders, Addresses, Term Loan Amounts and Term Loan Percentages
-------------------------------------------------------------------------
- ------------------------------------- ---------------------- ------------------
Term Loan Lender/Address Term Loan Amount ($) Term Loan %
- ------------------------------------- ---------------------- ------------------
Credit Lyonnais New York Branch 6,717,933.60 21.0178541536
1301 Avenue of the Americas
New York, NY 10019
- ------------------------------------- ---------------------- ------------------
ABN AMRO Bank N.V. 2,490,885.29 7.7930308489
10 East 53rd Street
37th Floor
New York, NY 10022
- ------------------------------------- ---------------------- ------------------
PB Capital Corporation f/k/a 5,327,707.94 16.6683678390
BHF (USA) Capital Corporation
590 Madison Avenue
29th Floor
New York, NY 10022
Attention: Ms. Ronni Leopold
- ------------------------------------- ---------------------- ------------------
Balanced High-Yield Fund I, Ltd. 801,513.83 2.5076469831
333 South Grand Avenue
Suite 4250
Los Angeles, CA 90071
- ------------------------------------- ---------------------- ------------------
Bank Austria Creditanstalt Corporate 5,377,349.29 16.8236767268
Finance, Inc.
2 Greenwich Plaza
Greenwich, CT 06830
- ------------------------------------- ---------------------- ------------------
Pamco Cayman Ltd. 2,978,192.56 9.3176295856
Highland Capital Management, L.P.
Two Galleria Tower
13455 Noel Road
Suite 1300
Dallas, TX 75240
- ------------------------------------- ---------------------- ------------------
- ------------------------------------- ---------------------- ------------------
-viii- INITIAL ________
- ------------------------------------- ---------------------- ------------------
Term Loan Lender/Address Term Loan Amount ($) Term Loan %
- ------------------------------------- ---------------------- ------------------
ML CBO IV (Cayman) Ltd. 821,980.13 2.5716625900
Highland Capital Management, L.P.
Two Galleria Tower
13455 Noel Road
Suite 1300
Dallas, TX 75240
- ------------------------------------- ---------------------- ------------------
The ING Capital Senior Secured High 2,904,057.34 9.0856887328
Yield Income Fund, L.P.
333 South Grand Avenue
Suite 4250
Los Angeles, CA 90071
- ------------------------------------- ---------------------- ------------------
ING Capital Advisors, LLC 801,518.83 2.5076469831
333 South Grand Avenue
Suite 4250
Los Angeles, CA 90071
- ------------------------------------- ---------------------- ------------------
Skandinaviska Enskilda Banken 2,495,070.32 7.8061241890
Corporation
245 Park Avenue
New York, NY 10167
- ------------------------------------- ---------------------- ------------------
Suntrust Bank 1,246,771.01 3.9006713682
201 4th Avenue North
12th Floor
Nashville, TN 37219
===================================== ====================== ==================
TOTAL $31,962,985.15 100%
- ------------------------------------- ---------------------- ------------------
-ix- INITIAL ________
SCHEDULE IB
-----------
Letter of Credit Lenders, Letter of Credit Loan Amounts and
-----------------------------------------------------------
Letter of Credit Loan Percentages
---------------------------------
- ------------------------------------------ ------------------ ------------------
Letter of Credit Letter of Credit
Letter of Credit Lender Loan Amount ($) Loan %
- ------------------------------------------ ------------------ ------------------
Credit Lyonnais New York Branch 443,407.30 34.2358300000
- ------------------------------------------ ------------------ ------------------
ABN AMRO Bank N.V. 145,289.90 11.2179487105
- ------------------------------------------ ------------------ ------------------
PB Capital Corporation f/k/a BHF (USA) 284,025.37 21.9298245526
Capital Corporation
- ------------------------------------------ ------------------ ------------------
Bank Austria Creditanstalt Corporate 204,498.27 15.7894736842
Finance, Inc.
- ------------------------------------------ ------------------ ------------------
Skandinaviska Enskilda Banken Corporation 145,289.90 11.2179486842
- ------------------------------------------ ------------------ ------------------
Suntrust Bank 72,644.95 5.6089743684
-------------
- ------------------------------------------ ------------------ ------------------
TOTAL $1,295,155.69 100%
- ------------------------------------------ ------------------ ------------------
-x- INITIAL ________
SCHEDULE IC
-----------
Unexpired Letters of Credit
---------------------------
- ------------- -------------------------- ------------- ------------------ ---------------------------
L/C Number Beneficiary Amount Expiration Status
- ------------- -------------------------- ------------- ------------------ ---------------------------
961121IS628 Airlines Reporting $20,000.00 October 10, 2002 Automatic renewal
Corporation (one year; 60 days notice)
- ------------- -------------------------- ------------- ------------------ ---------------------------
961121IS626 Insurance Company of the $200,000.00 August 18, 2002 Automatic renewal
State of Pennsylvania (one year; 30 days notice)
- ------------- -------------------------- ------------- ------------------ ---------------------------
961209IS655 National Union Fire $250,000.00 August 31, 2002 Automatic renewal
Insurance Company of (one year; 30 days notice)
Pittsburgh and other
beneficiaries named
therein
- ------------- -------------------------- ------------- ------------------ ---------------------------
-xi- INITIAL ________
SCHEDULE II
-----------
Mortgages
---------
(1) 5201 North Orange Blossom Trail
Orlando, FL 32810
(2) 730 Bluff Road
Marquette, IA 52158
(3) Wharf Way
Glen Parva
Leicester LE2 9TF
England
-xii- INITIAL ________
SCHEDULE III
------------
Leasehold Mortgages
-------------------
None
-xiii- INITIAL ________
SCHEDULE 3.1(e)
---------------
Quarterly Revenue Projections
-----------------------------
------------------------------ --------------------------------------
Quarter Ended Projected Revenue
------------------------------ --------------------------------------
3/31/02 $15,500,000
------------------------------ --------------------------------------
6/30/02 $15,500,000
------------------------------ --------------------------------------
9/30/02 $9,000,000
------------------------------ --------------------------------------
-xiv- INITIAL ________
SCHEDULE 4.3
------------
UCC Financing Statement Filing Offices
--------------------------------------
- --------------------------------------- ---------------------------------------
COMPANY NAME JURISDICTION
- --------------------------------------- ---------------------------------------
Bituma Corporation Iowa
Washington
- --------------------------------------- ---------------------------------------
Bituma-Stor, Inc. Iowa
- --------------------------------------- ---------------------------------------
Equipment Services Group, Inc. Florida
- --------------------------------------- ---------------------------------------
Gencor Industries, Inc. Colorado
Delaware
Florida
Iowa
Clayton County, Iowa (fixture filing)
Orange County, Florida (fixture filing)
- --------------------------------------- ---------------------------------------
General Combustion Corporation Florida
- --------------------------------------- ---------------------------------------
Thermotech Systems Corporation Florida
- --------------------------------------- ---------------------------------------
-xv- INITIAL ________
SCHEDULE 4.7
------------
Exceptions to Title
-------------------
None, except for Permitted Liens under subsection 7.3 of this Agreement.
-xvi- INITIAL ________
SCHEDULE 4.11(a)
----------------
Notice of Intent to Terminate CPM Defined Benefit Plan
------------------------------------------------------
-xvii- INITIAL ________
SCHEDULE 4.11(b)
----------------
Actuary's Confirmation of CPM Defined Benefit Plan Information
--------------------------------------------------------------
-xviii- INITIAL ________
SCHEDULE 4.13
-------------
Subsidiaries of Gencor Industries, Inc., a Delaware Corporation
---------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
State or Country % Subsidiary If Ownership is Indirect, Names of
Name of Subsidiary of Incorporation Owned by Gencor Subsidiaries in Ownership Chain
- ------------------ ---------------- --------------- -------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Bituma Corporation Washington 100% indirect Bituma is 100% owned by Bituma-Stor, Inc.,
which is 100% owned by Gencor Industries,
Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Bituma-Stor, Inc. Iowa 100% direct NA
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Equipment Services Group, Inc. Florida 100% direct NA
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Gencor International Limited, United Kingdom 100% direct NA
f/k/a Gencor Industries Limited
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
General Combustion Corporation Florida 100% direct NA
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
General Combustion Limited (UK) United Kingdom 100% direct NA
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Thermotech Systems Corporation Florida 100% direct NA
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Consolidated Process Machinery, California 100% direct NA
Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Silver Weibull AB Sweden 100% indirect Silver Weibull AB is 100% owned by
Consolidated Process Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
CPM Brazil, Inc. Florida 100% indirect CPM Brazil, Inc., is 100% owned by
Consolidated Process Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
CPM do Brasil Ltda. Brazil 100% indirect CPM do Brazil Ltda. is 99.9% owned by
CPM Brazil, Inc., and 0.1% owned by
Consolidated Process Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Gumaco, Inc. Florida 100% indirect Gumaco, Inc., is 100% owned by
Consolidated Process Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Gumaco Industria e Comercio Ltda. Brazil 100% indirect Gumaco Industria e Comercio Ltda. Is
99.9% owned by CPM do Brasil Ltda. and
0.1% owned by Consolidated Process
Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Gumaco Projetos e Montagens Ltda. Brazil 100% indirect Gumaco Projetos e Montagens Ltda. Is
99.9% owned by CPM do Brasil Ltda. and
0.1% owned by Consolidated Process
Machinery, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
CPM Industria e Comercio Ltda. Brazil 100% indirect CPM Industria e Comercio Ltda. is
99.9% owned by Consolidated Process
Machinery, Inc., and 0.1% owned by
Gencor Industries, Inc.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
-xix- INITIAL ________
- ---------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd. United Kingdom 100% indirect Gencor ACP Ltd. is 100% owned by Gencor
ACP Holdings Limited
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
ACP Cast Parts Limited United Kingdom 50% indirect ACP Cast Parts Limited is 50% owned by
Gencor ACP Ltd.
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Gencor ACP Holdings Limited United Kingdom 100% indirect Gencor ACP Holdings is 100% owned by
Gencor International Limited
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
-xx- INITIAL ________
SCHEDULE 4.14
-------------
Environmental Matters
---------------------
None
-xxi- INITIAL ________
SCHEDULE 4.15
-------------
Unsecured Pre-Petition Indebtedness
-----------------------------------
Class 1 Priority Claims: $5,000
Class 3 Gap Claims: $1,630,000
Class 4 Convenience Claims: $10,000
Class 5 General Unsecured Claims: $310,000
-xxii- INITIAL ________
SCHEDULE 4.18
-------------
Insurance
---------
- -----------------------------------------------------------------------------------------------------------------------
Insured Producer Insurance Company Type of Insurance
- ------- -------- ----------------- -----------------
- -----------------------------------------------------------------------------------------------------------------------
Gencor Industries, Inc. Willis of Florida Lumbermen's Mutual Commercial General Liability
5201 North Orange 7650 Courtney Causeway Casualty
Trail Blossom Tampa, FL 33607
Orlando, FL 32810
- -----------------------------------------------------------------------------------------------------------------------
Lumbermen's Mutual Business Auto
Casualty
- -----------------------------------------------------------------------------------------------------------------------
American Protection WC & Employers Liability
Insurance Co.
- -----------------------------------------------------------------------------------------------------------------------
Continental Casualty Property & Mobile
Equipment
- -----------------------------------------------------------------------------------------------------------------------
Zurich American Excess D&O Liability
Insurance Co.
- -----------------------------------------------------------------------------------------------------------------------
National Union Fire Ins. Primary D&O liability
Co. of Pittsburgh PA.
- -----------------------------------------------------------------------------------------------------------------------
Commerce & Industry Storage Tank Third-Party
Insurance Co. Liability Corrective Action
& Cleanup
- -----------------------------------------------------------------------------------------------------------------------
National Union Fire Executive & Organization
Insurance Co of Liability
Pittsburgh PA
- -----------------------------------------------------------------------------------------------------------------------
CAN Risk Management Real and Personal Property
Legacy Business Income
- -----------------------------------------------------------------------------------------------------------------------
Lumbermen's Mutual Commercial General
Casualty Liability
- -----------------------------------------------------------------------------------------------------------------------
National Union Fire Crime Guard Policy
Insurance Co
- -----------------------------------------------------------------------------------------------------------------------
Lumbermen's Mutual Commercial Umbrella
Casualty
- -----------------------------------------------------------------------------------------------------------------------
-xxiii- INITIAL ________
- -----------------------------------------------------------------------------------------------------------------------
General Combustion Ltd Zurich Insurance Co. Motor Vehicle
Brookers Road
Billingshurst
West Sussex RH14 9RZ
England
- -----------------------------------------------------------------------------------------------------------------------
Norwich Union Employers Liability
Insurance Company
- -----------------------------------------------------------------------------------------------------------------------
Zurich Insurance Contract Works
Company
- -----------------------------------------------------------------------------------------------------------------------
Norwich Insurance Fire Explosion Impact
Company
- -----------------------------------------------------------------------------------------------------------------------
AIG Public/Product Liability
- -----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd Marsh UK Ltd Royal & Sun Alliance Material Damage
Wharf Way St Johns House
Glen Parva 30 East Street
Leicester LE2 9TF Leicester LE1 6NN
England England
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Business Interruption
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Money
- -----------------------------------------------------------------------------------------------------------------------
AIG Europe (UK) Ltd Employers Liability
- -----------------------------------------------------------------------------------------------------------------------
AIG Europe (UK) Ltd Public/Products Liability
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Engineering Inspection
Engineering
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Contractors All Risks
Engineering
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Computer
Engineering
- -----------------------------------------------------------------------------------------------------------------------
Chubb Insurance Personal Accident/Business
Company of Europe SA Travel
- -----------------------------------------------------------------------------------------------------------------------
AIG Europe (UK) Ltd Marine Transit
- -----------------------------------------------------------------------------------------------------------------------
Royal & Sun Alliance Motor Fleet (including
Uninsured Loss Recovery)
- -----------------------------------------------------------------------------------------------------------------------
-xxiv- INITIAL ________
SCHEDULE 4.22
-------------
Bank Accounts - Domestic
------------------------
- ----------------------------------------------------------------------------------------------------------------------
BANK/ADDRESS ACCOUNT HOLDER ACCOUNT NUMBER TYPE OF ACCOUNT
- ----------------------------------------------------------------------------------------------------------------------
AmSouth Bank Gencor Industries Inc 3720420854 Main Depository/Sweep
Apopka Wekiva Office Debtor In Possession Account - CEG
2101 East Semoran Blvd
Apopka, FL 32703-5723
- ----------------------------------------------------------------------------------------------------------------------
Gencor Industries Inc 3720523793 Checking for CEG & Corp A/P
Debtor In Possession
- ----------------------------------------------------------------------------------------------------------------------
Gencor Industries Inc 3720421222 Checking for CEG & Corp
Debtor In Possession payroll
- ----------------------------------------------------------------------------------------------------------------------
Equipment Serv Grp Inc 3720523785 Checking for ESG A/P
Debtor In Possession
- ----------------------------------------------------------------------------------------------------------------------
Gencor Industries Inc 3720421230 Checking for employee
Employee Health Plan health ins claims
- ----------------------------------------------------------------------------------------------------------------------
Gencor Industries Inc 3720421249 Checking for employee
Flexible Benefits Account flexible benefits
- ----------------------------------------------------------------------------------------------------------------------
Gencor Travel 3720421028 Checking for Travel dept
expenses
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Debtor In 3720638841 Depository for Silver
Possession customer payments
- ----------------------------------------------------------------------------------------------------------------------
Consolidated Process 3720421435 Main Depository/Sweep
Machinery Inc Debtor in Account
Possession
- ----------------------------------------------------------------------------------------------------------------------
Consolidated Process 3720523815 Checking for CPM accounts
Machinery Inc Debtor in payable
Possession
- ----------------------------------------------------------------------------------------------------------------------
Consolidated Process 3720421257 Checking for CPM payroll
Machinery Inc Debtor in
Possession
- ----------------------------------------------------------------------------------------------------------------------
Roskamp Champion a Div of 3720523807 Checking for Roskamp A/P
CPM Inc Debtor in Possession
- ----------------------------------------------------------------------------------------------------------------------
Gumaco USA 3720420935 Checking for Gumaco USA A/P
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Colonial Bank Gencor Industries Inc 8026030125 Checking/Depository fixed
Winter Park Office Debtor in Possession asset sales
699 North Orlando Avenue
Winter Park, FL 32789
- ----------------------------------------------------------------------------------------------------------------------
Gencor Industries Inc 8026030125R Repo Account
Debtor in Possession
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
F&M Bank Bituma Corporation Debtor 4520024938 Depository/Local checking
300 E. Blackhawk Avenue in Possession for Bituma
PO Box 338
Prairie du Chien, WI 53821-0338
- ----------------------------------------------------------------------------------------------------------------------
-xxv- INITIAL ________
- ----------------------------------------------------------------------------------------------------------------------
SouthTrust Bank Gencor Industries Inc 71-109-989 Checking for CEG credit
PO Box 2166 card payments
Orlando, FL 32802
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
National City Bank Consolidated Process 501790929 Checking for CPM credit
One National City Center Machinery Inc card payments
Indianapolis, IN 46255
- ----------------------------------------------------------------------------------------------------------------------
Consolidated Process 501704177 Checking/Depository for
Machinery Inc scrap sales
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Firstar Bank Consolidated Process 8708003408 Checking and Depository for
425 Cedar St Machinery Inc wire transfers & credit
Waterloo, IA 50701 card payments
- ----------------------------------------------------------------------------------------------------------------------
Bank Accounts - Foreign
-----------------------
- ----------------------------------------------------------------------------------------------------------------------
BANK/ADDRESS ACCOUNT HOLDER ACCOUNT NUMBER TYPE OF ACCOUNT
- ----------------------------------------------------------------------------------------------------------------------
Bradesco - Araraquara CPM do Brasil Ind. Com. 45.383-8 Current Account
Banco Brasileiro de Descontos S/A Ltda.
Rua Sao Bento, 975 - Centro
Araraquara - Sao Paulo
CEP - 14801-300
- ----------------------------------------------------------------------------------------------------------------------
Gumaco-Industria e Comercio 29.031-9 Current Account
Ltda.
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
BCN - Araraquara Gumaco-Industria e Comercio 559.572-5 Current Account
Banco de Credito Nacional S/A Ltda.
Avenida Duque de Caxias, 578 Centro
Araraquara - Sao Paulo
CEP - 14801-120
- ----------------------------------------------------------------------------------------------------------------------
CPM do Brasil Ind. Com. 563.056-3 Current Account
Ltda.
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
BCN - Sao Paulo Gumaco-Industria e Comercio 700.904-1 Current Account
Banco de Credito Nacional S/A Ltda.
Rua Barao do Triunfo, 511 - Brooklin
Sao Paulo - Capital
CEP - 04602-002
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Sudameris - Araraquara Gumaco-Industria e Comercio 081433000-7 Current Account
Banco Sudameris do Brazil S/A Ltda.
Rua Sao Bento, 849 - Centro
Araraquara - Sao Paulo
CEP - 14801-300
- ----------------------------------------------------------------------------------------------------------------------
CPM do Brasil Ind. Com. 097043000-5 Current Account
Ltda.
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
-xxvi- INITIAL ________
- ----------------------------------------------------------------------------------------------------------------------
BankBoston - Campinas Gumaco-Industria e Comercio 235.985-03 Current Account
BankBoston S/A Ltda.
Avenida Francisco Glicerio, 1422 -
Centro
Campinas - Sao Paulo
CEP - 13012-100
- ----------------------------------------------------------------------------------------------------------------------
CPM do Brasil Ltda. 294.010-06 Current Account
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Brasil - Araraquara Gumaco-Industria e Comercio 4.066-5 Current Account
Banco do Brazil S/A Ltda.
Rua Padre Duarte, 1355 - Centro
Araraquara - Sao Paulo
CEP - 14801-310
- ----------------------------------------------------------------------------------------------------------------------
CPM do Brasil Ind. Com. 4.314-1 Current Account
Ltda.
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
CEF - Araraquara Gumaco-Industria e Comercio 3.645-8 Current Account
Caixa Economica Federal Ltda.
Rua 9 de Julho, 672 - Centro
Araraquara - Sao Paulo
CEP - 14801-295
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
The Royal Bank of Scotland Plc Gencor International Ltd 10130935 Business Current A/C
5 Market Street
Leicester LE1 6DN
England
- ----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd 10131435 Business High Interest A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd 10130943 Cash Cover Business High
Interest A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd GENIND-USDA Interest Paying Current US
Dollar A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd GENIND-EURA Interest Paying Current
Euro A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor International Ltd GENIND-AUDA Interest Paying Current
Australia Dollar A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 10109936 Special Interest Bearing
Deposit A/C
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
The Royal Bank of Scotland Plc Gencor ACP Ltd 21585656 (In Receivership) Fixed A/C
48 Haymarket
London SW1Y 4SE
England
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 21585664 (In Receivership) Floating
Charge A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 00104917 Business Current A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 00166548 Business High Interest A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 00166564 Cash Cover Business High
Interest A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 00177961 Cash Cover A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd 91028398 Fixed Term Bid Deposit A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd GENACP-USD1 Interest Paying Current US
Dollar A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd GENACP-EUR1 Interest Paying Current
Euro A/C
- ----------------------------------------------------------------------------------------------------------------------
-xxvii- INITIAL ________
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd GENACP-DEM1 Interest Paying Current
Deutsche Mark A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd GENACP-AUD1 Interest Paying Current
Australia Dollar A/C
- ----------------------------------------------------------------------------------------------------------------------
Gencor ACP Ltd GENACP-IEP1 Interest Paying Current
Irish Punts A/C
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Lloyds TSB Bank plc General Combustion Limited 1530427 Sterling Current Account
71 Lombard Street
London EC3P 3BS
England
- ----------------------------------------------------------------------------------------------------------------------
General Combustion Limited 1728839 Sterling Business Call
Account
- ----------------------------------------------------------------------------------------------------------------------
General Combustion Limited 00354110 Sterling Guarantee Deposit
Account
- ----------------------------------------------------------------------------------------------------------------------
General Combustion Limited 11194542 (USD) US Dollar Current Account
- ----------------------------------------------------------------------------------------------------------------------
General Combustion Limited 3030227 Sterling Business Call
Re Gencor Industries Account
- ----------------------------------------------------------------------------------------------------------------------
General Combustion Limited 11379399 Dollar Business Call Account
Re Gencor Industries
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Skandinaviska Enskilda Banken Silver Weibull Aktiebolag 5683-10 029 43 SEK Cheque Account
PO Box 128 (SEK)
S-291 22 Kristianstad
Sweden
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Aktiebolag 5501-82 898 56 USD Cheque Account
(USD)
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Aktiebolag 5501-82 918 69 DEM Cheque Account
(DEM)
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Aktiebolag 5901-82 025 76 EUR Cheque Account
(EUR)
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Nordbanken AB Silver Weibull Aktiebolag 3091-17 07204 SEK Cheque Account
PO Box 145 (SEK)
S-281 22 Hassleholm
Sweden
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Aktiebolag 3091-17 07204 USD Cheque Account
(USD)
- ----------------------------------------------------------------------------------------------------------------------
Silver Weibull Aktiebolag 3019-17 07204 EUR Cheque Account
(EUR)
- ----------------------------------------------------------------------------------------------------------------------
-xxviii- INITIAL ________
SCHEDULE 5.1(n)
---------------
Title Insurance Policies
------------------------
- ----------------------------------- ------------------------------------------------- --------------------------------
COMPANY PROPERTY ADDRESS POLICY AMOUNT
------- ---------------- -------------
- ----------------------------------- ------------------------------------------------- --------------------------------
Gencor Industries, Inc. 5201 North Orange Blossom Trail $8,280,000
Orlando, Orange County, Florida
- ----------------------------------- ------------------------------------------------- --------------------------------
Gencor Industries, Inc. 730 Bluff Road $1,700,000
Marquette, Clayton County, Iowa
- ----------------------------------- ------------------------------------------------- --------------------------------
-xxix- INITIAL ________
SCHEDULE 6.1(c)
---------------
Form of Monthly Other Report
----------------------------
Gencor Industries, Inc.
Monthly Other Report
For Month Ending ____________
Month Ending
---------------
CEG ACP
Invoiced Sales --------------- ---------------
(1) Accounts Receivable Aged
0-30 days
30-59 days
60-89 days
90-119 days
120-149 days
150-359 days
360 + days
--------------- ---------------
=============== ===============
(2) Accounts Payable Aged
0-30 days
31-60 days
61-90 days
91-180 days
181 + days
--------------- ---------------
=============== ===============
Customer Deposits
--------------- ---------------
Backlog
--------------- ---------------
Notes:
Report provided to secured creditor distribution list and debtor
distribution list. Accounts receivable and accounts payable excludes
all intercompany debtors.
-xxx- INITIAL ________
SCHEDULE 7.2(e)
---------------
Intercompany Transactional Indebtedness
---------------------------------------
Promissory notes payable to Gencor Industries, Inc.
- --------------------------------------- -------------------------- ----------------------------
Maker Date Original Principal Amount
- --------------------------------------- -------------------------- ----------------------------
Gencor International Limited November 13, 1997 (pound)2,000,000
formerly Gencor Industries -------------------------- ----------------------------
Limited June 13, 2001 (pound)4,000,000
- -----------------------------------------------------------------------------------------------
Balance as of November 30, 2001: $5,492,000.00
- -----------------------------------------------------------------------------------------------
- --------------------------------------- -------------------------- ----------------------------
Maker Date Original Principal Amount
- --------------------------------------- -------------------------- ----------------------------
ACP Holdings Limited November 13, 1997 (pound)6,052,966.44
- --------------------------------------- -------------------------- ----------------------------
February 19, 1998 (pound)344,998
- --------------------------------------- -------------------------- ----------------------------
February 23, 1998 (pound)254,988
- --------------------------------------- -------------------------- ----------------------------
March 25, 1998 (pound)177,556
- --------------------------------------- -------------------------- ----------------------------
April 9, 1998 (pound)176,000
- --------------------------------------- -------------------------- ----------------------------
April 20, 1998 (pound)600,000
- --------------------------------------- -------------------------- ----------------------------
April 28, 1998 (pound)400,000
- --------------------------------------- -------------------------- ----------------------------
May 7, 1998 (pound)200,000
- --------------------------------------- -------------------------- ----------------------------
December 2, 1998 (pound)200,000
- --------------------------------------- -------------------------- ----------------------------
January 19, 1999 (pound)104,000
- --------------------------------------- -------------------------- ----------------------------
January 26, 1999 (pound)300,000
- --------------------------------------- -------------------------- ----------------------------
February 1, 1999 (pound)500,000
- --------------------------------------- -------------------------- ----------------------------
February 8, 1999 (pound)200,000
- --------------------------------------- -------------------------- ----------------------------
February 12, 1999 (pound)200,000
- --------------------------------------- -------------------------- ----------------------------
February 23, 1999 (pound)300,000
- --------------------------------------- -------------------------- ----------------------------
March 18, 1999 (pound)300,000
- --------------------------------------- -------------------------- ----------------------------
April 30, 2001 (pound)209,658
- --------------------------------------- -------------------------- ----------------------------
May 21, 2001 (pound)386,562
- -----------------------------------------------------------------------------------------------
Balance as of November 30, 2001: $6,372,485.33
- -----------------------------------------------------------------------------------------------
- --------------------------------------- -------------------------- ----------------------------
Maker Date Original Principal Amount
- --------------------------------------- -------------------------- ----------------------------
General Combustion Limited September 21, 2001 $4,150,625.47
- --------------------------------------- -------------------------- ----------------------------
Balance as of November 30, 2001: $4,150,625.47
- -----------------------------------------------------------------------------------------------
Total Balance as of November 30, 2001: $16,015,110.80
-xxxi- INITIAL ________