[W&C Draft: (New York) June 5, 1998])
Exhibit 10.8
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CREDIT AGREEMENT
among
WORKFLOW MANAGEMENT, INC.,
DATA BUSINESS FORMS LIMITED,
VARIOUS LENDING INSTITUTIONS,
and
BANKERS TRUST COMPANY,
as AGENT
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Dated as of June 9, 1998
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$150,000,000
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CREDIT AGREEMENT, dated as of June 9, 1998, among WORKFLOW MANAGEMENT, INC.
a Delaware corporation ("Workflow"), DATA BUSINESS FORMS LIMITED, a corporation
organized and existing under the laws of Ontario ("DBF" and, together with
Workflow, the "Borrowers" and each, a "Borrower"), the Lenders from time to time
party hereto, and BANKERS TRUST COMPANY, as Agent (in such capacity, the
"Agent"). Unless otherwise defined herein, all capitalized terms used herein and
defined in Section 10 are used herein as so defined.
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions herein set forth, the
Lenders are willing to make available to the Borrowers the respective credit
facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 Commitments. (a) Subject to and upon the terms and conditions set
forth herein, (x) each Lender (other than a Canadian Lender in its capacity as
such) severally agrees to make a revolving loan or revolving loans to Workflow,
which revolving loans shall be made and maintained in Dollars (each a "Dollar
Revolving Loan" and, collectively, the "Dollar Revolving Loans") and (y) each
Canadian Lender severally agrees to make a revolving loan or revolving loans to
DBF, which revolving loans shall be made and maintained in Canadian Dollars
(each a "Canadian Revolving Loan" and, collectively, the "Canadian Revolving
Loans", and with the revolving loans made to the Borrowers pursuant to this
Section 1.01(a) being herein called a "Revolving Loan" and, collectively, the
"Revolving Loans"), which Revolving Loans:
(i) shall be made at any time and from time to time on and after the
Effective Date and prior to the Final Maturity Date;
(ii) shall, in the case of Dollar Revolving Loans, and at the option
of Workflow, be incurred and maintained as, and/or converted into, Base
Rate Loans or Eurodollar Loans, provided that (A) except as otherwise
specifically provided herein, all Dollar Revolving Loans comprising the
same Borrowing shall be of the same Type and (B) prior to the Syndication
Date, Dollar Revolving Loans may only be incurred as Eurodollar Loans on
the first day of a PSD Interest Period;
(iii) shall, in the case of Canadian Revolving Loans, and at the
option of DBF, be made either by means of (x) Canadian Prime Rate Loans in
Canadian Dollars or (y) Bankers' Acceptances Loans in Canadian Dollars on
the terms and conditions provided for herein and in Annex III (the terms
and conditions of which shall be deemed incorporated by reference into this
Agreement);
(iv) may be repaid and reborrowed in accordance with the provisions
hereof;
(v) shall not be made (or be required to be made) by any Lender on any
date if, after giving effect thereto, the Revolving Credit Exposure of such
Lender would exceed the Commitment of such Lender at such time;
(vi) shall not, in the case of Canadian Revolving Loans, exceed for
any Canadian Lender at the time of the making of any such Canadian
Revolving Loans, and after giving effect thereto, that aggregate principal
amount or Face Amount, as the case may be, of such Canadian Revolving Loans
(for this purpose, using the Dollar Equivalent of the principal amount or
Face Amount, as the case may be, thereof) which, when added to the Dollar
Equivalent of the aggregate principal amount or Face Amount, as the case
may be, of all other Canadian Revolving Loans then outstanding from such
Canadian Lender, equals the Canadian Sub-Commitment of such Canadian Lender
at such time;
(vii) shall not, in the case of Canadian Revolving Loans, exceed for
all Canadian Lenders at the time of the making of any such Canadian
Revolving Loans, and after giving effect thereto, that aggregate principal
amount or Face Amount, as the case may be, of such Canadian Revolving Loans
(for this purpose, using the Dollar Equivalent of the principal amount or
Face Amount, as the case may be, thereof) which, when added to the Dollar
Equivalent of the aggregate principal amount or Face Amount, as the case
may be, of all other Canadian Revolving Loans then outstanding, equals the
Total Canadian Sub-Commitment at such time;
(viii) shall not, in the case of Dollar Revolving Loans, exceed for
all Lenders at the time of the making of any such Dollar Revolving Loans,
and after giving effect thereto, that aggregate principal amount of such
Dollar Revolving Loans which, when added to the sum of (I) the aggregate
principal amount of all other Dollar Revolving Loans then outstanding, (II)
the aggregate principal amount of all Swingline Loans then outstanding and
(III) the aggregate amount of all Letter of Credit Outstandings at such
time, equals the Total Dollar Sub-Commitment at such time; and
(ix) shall not, in the case of all Revolving Loans, be made at any
time if, after giving effect thereto, the Aggregate Revolving Credit
Exposure would exceed the Total Commitment at such time.
(b) Revolving Loans may not be incurred as Acquisition Loans if, after
giving effect thereto, the aggregate outstanding principal amount or Face
Amount, as the case may be, of all Acquisition Loans (for this purpose, using
the Dollar Equivalent of the principal amount or Face Amount, as the case may
be, of any Canadian Revolving Loans) would exceed the Acquisition Sub-Limit then
in effect.
(c) (A) Subject to and upon the terms and conditions set forth herein, BTCo
in its individual capacity agrees to make, at any time and from time to time on
and after the Effective Date and prior to the Swingline Expiry Date, a revolving
loan or revolving loans to Workflow (each a "Swingline Loan" and, collectively,
the "Swingline Loans"), which Swingline Loans:
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(i) shall be made and maintained in Dollars and as Base Rate Loans;
(ii) may be repaid and reborrowed in accordance with the provisions
hereof;
(iii) shall not be made (or required to be made) on any date if, after
giving effect thereto, the Aggregate Revolving Credit Exposure would exceed
the Total Commitment at such time; and
(iv) shall not exceed in aggregate principal amount at any time
outstanding the Maximum Swingline Amount.
(B) BTCo shall not be obligated to make any Swingline Loans at a
time when a Lender Default exists unless BTCo has entered into arrangements
satisfactory to it and Workflow to eliminate BTCo's risk with respect to the
Defaulting Lender's or Lenders' participation in such Swingline Loans, including
by cash collateralizing each such Defaulting Lender's Dollar Percentage of the
outstanding Swingline Loans. BTCo will not make a Swingline Loan after it has
received written notice from Workflow, any other Credit Party or the Required
Lenders stating that a Default or an Event of Default exists until such time as
(x) BTCo shall have received a written notice of (i) rescission of such notice
from the party or parties originally delivering the same or (ii) the waiver of
such Default or Event of Default from the Required Lenders or (y) the cure of
such Default or Event of Default.
(C) On any Business Day, BTCo may, in its sole discretion, give
notice to the Lenders that its outstanding Swingline Loans shall be funded with
a Borrowing of Dollar Revolving Loans (provided that each such notice shall be
deemed to have been automatically given upon the occurrence of a Default or an
Event of Default under Section 9.05 or upon the exercise of any of the remedies
provided in the last paragraph of Section 9), in which case a Borrowing or
Borrowings of Dollar Revolving Loans, as the case may be, constituting Base Rate
Loans (each such Borrowing or Borrowings, collectively, a "Mandatory Borrowing")
shall be made on the immediately succeeding Business Day by all Lenders pro rata
based on each Lender's Dollar Percentage or, if a Sharing Event then exists, pro
rata based on each Lenders' Percentage, and the proceeds thereof shall be
applied directly to repay BTCo for such outstanding Swingline Loans. Each Lender
hereby irrevocably agrees to make Dollar Revolving Loans upon one Business Day's
notice pursuant to each Mandatory Borrowing in the amount and in the manner
specified in the preceding sentence and on the date specified in writing by BTCo
notwithstanding (i) that the amount of the Mandatory Borrowing may not comply
with the Minimum Borrowing Amount otherwise required hereunder, (ii) whether any
conditions specified in Section 5 are then satisfied, (iii) whether a Default or
an Event of Default has occurred and is continuing, (iv) the date of such
Mandatory Borrowing and (v) the amount of, or termination of, the Total
Commitment at such time. In the event that any Mandatory Borrowing cannot for
any reason be made on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding under the Bankruptcy
Code in respect of Workflow), each Lender (other than BTCo) hereby agrees that
it shall forthwith purchase (as of the date the Mandatory Borrowing would
otherwise have occurred, but adjusted for any payments received from Workflow on
or after such date and prior to such purchase) from
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BTCo such participations in the outstanding Swingline Loans as shall be
necessary to cause such Lenders to share in such Swingline Loans ratably based
upon their respective Dollar Percentages or, if a Sharing Event exists on the
date otherwise required above, pro rata based upon their respective Percentages,
provided that (x) all interest payable on the Swingline Loans shall be for the
account of BTCo until the date as of which the respective participation is
required to be purchased and, to the extent attributable to the purchased
participation, shall be payable to the participant from and after such date and
(y) at the time any purchase of participations pursuant to this sentence is
actually made, the purchasing Lender shall be required to pay BTCo interest on
the principal amount of the participation purchased for each day from and
including the day upon which the respective participation would otherwise have
occurred to but excluding the date of payment for such participation, at the
Federal Funds Effective Rate for the first day and at the rate otherwise
applicable to Dollar Revolving Loans maintained as Base Rate Loans hereunder for
each day thereafter.
(d) Subject to and upon the terms and conditions set forth herein, each
Lender severally agrees that Workflow may, in accordance with the procedures
established pursuant to Section 1.04, incur a loan or loans (each a "Competitive
Bid Loan" and, collectively, the "Competitive Bid Loans"), denominated in
Dollars, pursuant to a Competitive Bid Borrowing at any time and from time to
time after the Effective Date and prior to the date which is 45 days prior to
the Final Maturity Date, provided that no Competitive Bid Loan may be made if,
after giving effect thereto, the Aggregate Revolving Credit Exposure would
exceed the Total Commitment as then in effect. Within the foregoing limits and
subject to the terms and conditions set forth in Sections 1.04 and 5,
Competitive Bid Loans may be repaid and reborrowed in accordance with the
provisions hereof. Competitive Bid Loans may not be incurred as Acquisition
Loans if, after giving thereto, the aggregate outstanding principal amount or
Face Amount, as the case may be, of all Acquisition Loans (for this purpose,
using the Dollar Equivalent of the principal amount or Face Amount, as the case
may be, of any Canadian Revolving Loans) would exceed the Acquisition Sub-Limit
then in effect.
1.02 Minimum Borrowing Amounts, etc. The aggregate principal amount of each
Borrowing of Loans (other than Revolving Loans made pursuant to a Mandatory
Borrowing) shall not be less than the Minimum Borrowing Amount applicable
thereto. More than one Borrowing may be incurred on any day, provided that at no
time shall there be outstanding more than ten Borrowings of Eurodollar Loans (or
such greater number of Borrowings of Eurodollar Loans as is acceptable to the
Agent).
1.03 Notice of Borrowing. (a) Whenever a Borrower desires to incur
Revolving Loans hereunder (excluding (x) Revolving Loans incurred pursuant to a
Mandatory Borrowing and (y) Borrowings of Canadian Prime Rate Loans to the
extent resulting from automatic conversions of Bankers' Acceptance Loans as
provided in clause (i) of Annex III), such Borrower shall give the Agent at the
Notice Office, (x) prior to 11:00 A.M. (New York time), at least three Business
Days' prior written notice (or telephonic notice promptly confirmed in writing)
of each Borrowing of Eurodollar Loans or Banker's Acceptance Loans and (y) prior
to 11:00 A.M. (New York time), at least one Business Day's prior written notice
(or telephonic notice promptly confirmed in writing) of each Borrowing of Base
Rate Loans or Canadian Prime
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Rate Loans. Each such notice (each, a "Notice of Borrowing") shall, except as
provided in Section 1.11(a) or (b), be irrevocable, and, in the case of each
written notice and each written confirmation of telephonic notice, shall be in
the form of Exhibit A-1, appropriately completed to specify: (i) the aggregate
principal amount (or Face Amount, as the case may be) of the Revolving Loans to
be incurred pursuant to such Borrowing (stated in the Applicable Currency); (ii)
the date of such Borrowing (which shall be a Business Day); (iii) in the case of
Dollar Revolving Loans, whether the respective Borrowing shall consist of Base
Rate Loans or, to the extent permitted hereunder, Eurodollar Loans and, if
Eurodollar Loans, the Interest Period to be initially applicable thereto; (iv)
in the case of Canadian Revolving Loans, whether the Canadian Revolving Loans
being made pursuant to such Borrowing are to be initially maintained as Canadian
Prime Rate Loans or Bankers' Acceptance Loans and, if Bankers' Acceptance Loans,
the term thereof (which shall comply with the requirements of clause (a) of
Annex III); and (v) the respective portions of such Borrowing to constitute
Acquisition Loans and Working Capital Loans.
(b) (i) Whenever Workflow desires to incur Swingline Loans hereunder,
Workflow shall give BTCo no later than 12:00 Noon (New York time) on the day
such Swingline Loan is to be incurred, written notice (or telephonic notice
promptly confirmed in writing) of such Swingline Loan. Each such notice shall be
irrevocable and shall specify in each case (x) the date of such incurrence
(which shall be a Business Day) and (y) the aggregate principal amount of the
Swingline Loan requested to be made.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(c)(C), with Workflow irrevocably agreeing, by its incurrence of any
Swingline Loan, to the making of Mandatory Borrowings as set forth in such
Section 1.01 (c) (C).
(c) The Agent shall promptly give each Lender written notice (or telephonic
notice promptly confirmed in writing) of each proposed Borrowing of Revolving
Loans, of such Lender's proportionate share thereof, and of the other matters
covered by the respective Notice of Borrowing.
(d) Without in any way limiting the obligation of any Borrower to confirm
in writing any telephonic notice permitted to be given hereunder, the Agent or
BTCo (in the case of a Borrowing of Swingline Loans), as the case may be, may
prior to receipt of written confirmation act without liability upon the basis of
such telephonic notice, believed by the Agent or BTCo in good faith to be from
the president, any vice-president or any Authorized Financial Officer of such
Borrower, or from any other authorized officer of such Borrower designated in
writing by such Borrower to the Agent as being authorized to give such notices.
In each such case, each Borrower hereby waives the right to dispute the Agent's
or BTCo's record of the terms of such telephonic notice.
1.04 Competitive Bid Borrowings. (a) Whenever Workflow desires to incur a
Competitive Bid Borrowing, Workflow shall deliver to the Agent at the Notice
Office prior to 11:00 A.M (New York time), at least three Business Days prior to
the date of such proposed Competitive Bid Borrowing, a written notice
substantially in the form of Exhibit B (each a
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"Notice of Competitive Bid Borrowing"), such notice to specify in each case (i)
the date of the proposed Competitive Bid Borrowing (which shall be a Business
Day), (ii) the aggregate principal amount of the proposed Competitive Bid
Borrowing (which shall not be less than the Minimum Borrowing Amount applicable
thereto), (iii) the maturity date (each a "Competitive Bid Loan Maturity Date")
for repayment of each Competitive Bid Loan to be made as part of such
Competitive Bid Borrowing (which maturity date may not be earlier than seven
days after the date of such Competitive Bid Borrowing or later than 360 days
after the date of such Competitive Bid Borrowing (but in no event later than the
thirtieth day preceding the Final Maturity Date)), (iv) the interest payment
date or dates relating thereto (which shall be at least every three months in
the case of maturities in excess of three months), and (v) any other terms to be
applicable to such Competitive Bid Borrowing (although all Competitive Bid
Borrowings shall be required to be made, and maintained, in Dollars). The Agent
shall promptly notify each Bidder Lender of each such request for a Competitive
Bid Borrowing received by it from Workflow by telecopying to each such Bidder
Lender a copy of the related Notice of Competitive Bid Borrowing.
(b) Each Bidder Lender shall, if in its sole discretion it elects to do so,
irrevocably offer to make one or more Competitive Bid Loans to Workflow as part
of such proposed Competitive Bid Borrowing at a rate or rates of interest
specified by such Bidder Lender in its sole discretion and determined by such
Bidder Lender independently of each other Bidder Lender, by notifying the Agent
in writing (which notice shall be promptly distributed to Workflow, provided
that the Agent shall not be liable to any Bidder Lender or to Workflow for
failure to distribute any such notice to Workflow unless such failure resulted
from the gross negligence or willful misconduct on the part of the Agent (as
finally determined by a court of competent jurisdiction)), before 10:00 A.M.
(New York time) on the date (the "Reply Date") which is two Business Days before
the date of such proposed Competitive Bid Borrowing, of the minimum amount, if
any, and maximum amount of each Competitive Bid Loan which such Bidder Lender
would be willing to make as part of such proposed Competitive Bid Borrowing
(which amounts may, subject to the proviso to the first sentence of Section
1.01(d), exceed such Lender's Commitment) and the rate or rates of interest
therefor; provided, that if the Agent in its capacity as a Bidder Lender shall,
in its sole discretion, elect to make any such offer, it shall notify Workflow
in writing of such offer before 9:30 A.M. (New York time) on the Reply Date. If
any Bidder Lender shall elect not to make such an offer, such Bidder Lender
shall so notify the Agent, before 10:00 A.M. (New York time) on the Reply Date,
and such Bidder Lender shall not be obligated to, and shall not, make any
Competitive Bid Loan as part of such Competitive Bid Borrowing; provided, that
the failure by any Bidder Lender to give such notice shall not cause such Bidder
Lender to be obligated to, and such Bidder Lender shall not, make any
Competitive Bid Loan as part of such proposed Competitive Bid Borrowing.
(c) Workflow shall, in turn, before 12:00 Noon (New York time) on the Reply
Date, either
(1) cancel such Competitive Bid Borrowing by giving the Agent notice
(in writing or by telephone promptly confirmed in writing) to that effect,
or
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(2) accept one or more of the offers made by any Bidder Lender or
Bidder Lenders pursuant to clause (b) above by giving notice (in writing or
by telephone confirmed in writing) to the Agent of the amount of each
Competitive Bid Loan (which amount shall be equal to or greater than the
minimum amount, if any, and equal to or less than the maximum amount,
notified to Workflow by the Agent on behalf of each such Bidder Lender for
such Competitive Bid Borrowing) and reject any remaining offers made by
Bidder Lenders pursuant to clause (b) above by giving the Agent notice to
that effect; provided that acceptance of offers may only be made on the
basis of ascending Absolute Rates commencing with the lowest rate so
offered; provided further, however, if offers are made by two or more
Bidder Lenders at the same rate and acceptance of all such equal offers
would result in a greater principal amount of Competitive Bid Loans being
accepted than the aggregate principal amount requested by Workflow,
Workflow shall have the right to accept one or more such equal offers in
their entirety and reject the other equal offer or offers or to allocate
acceptance among all such equal offers (but giving effect to the minimum
amounts, if any, and maximum amounts specified for each such offer pursuant
to clause (b) above), as Workflow may elect in its sole discretion.
(d) If Workflow notifies the Agent that such Competitive Bid Borrowing is
canceled pursuant to clause (c)(1) above, the Agent shall give prompt written
notice thereof to the Bidder Lenders and such Competitive Bid Borrowing shall
not be made.
(e) If Workflow accepts one or more of the offers made by any Bidder Lender
or Bidder Lenders pursuant to clause (c)(2) above, the Agent shall in turn
promptly notify (in writing or by telephone confirmed in writing) (x) each
Bidder Lender that has made an offer as described in clause (b) above, of the
date and aggregate amount of such Competitive Bid Borrowing and whether or not
any offer or offers made by such Bidder Lender pursuant to clause (b) above have
been accepted by such Borrower and (y) each Bidder Lender that is to make a
Competitive Bid Loan as part of such Competitive Bid Borrowing, of the amount of
each Competitive Bid Loan to be made by such Bidder Lender as part of such
Competitive Bid Borrowing.
(f) On the last Business Day of each calendar quarter, the Agent shall
notify the Borrowers and the Lenders of the aggregate principal amount of
Competitive Bid Loans outstanding to Workflow at such time.
1.05 Disbursement of Funds. (a) No later than 1:00 P.M. (New York time) on
the date specified in each Notice of Borrowing (or (x) in the case of Swingline
Loans, no later than 2:00 P.M. (New York time) on the date specified in the
notice delivered pursuant to Section 1.03(b), (y) in the case of Mandatory
Borrowings, no later than 12:00 Noon (New York time) on the date specified in
Section 1.01(c)(C), or (z) in the case of Competitive Bid Loans, no later than
1:00 P.M. (New York time) on the date specified pursuant to Section 1.04(a)),
each Lender (or, in the case of a Borrowing of Canadian Revolving Loans, each
Canadian Lender) will make available its pro rata share of each Borrowing
requested to be made on such date (or (x) in the case of Swingline Loans, BTCo
shall make available the full amount thereof and (y) in the case of Competitive
Bid Loans, the respective Bidder Lenders which are to make such Competitive
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Bid Loans in accordance with Section 1.04(e) shall make available their
respective amounts thereof) in the manner provided below. All amounts shall be
made available to the Agent in Dollars (in the case of Dollar Loans) or Canadian
Dollars (in the case of Canadian Revolving Loans), as the case may be, and
immediately available funds at the appropriate Payment Office and, except for
Revolving Loans made pursuant to a Mandatory Borrowing, the Agent promptly will
make available to the respective Borrower by depositing to its account at the
appropriate Payment Office the aggregate of the amounts so made available in the
type of funds received. Unless the Agent shall have been notified by any Lender
prior to the date of Borrowing that such Lender does not intend to make
available to the Agent its portion of the Borrowing or Borrowings to be made on
such date, the Agent may assume that such Lender has made such amount available
to the Agent on such date of Borrowing, and the Agent, in reliance upon such
assumption, may (in its sole discretion and without any obligation to do so)
make available to the respective Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Agent by such Lender
and the Agent has made available same to the respective Borrower, the Agent
shall be entitled to recover such corresponding amount from such Lender. If such
Lender does not pay such corresponding amount forthwith upon the Agent's demand
therefor, the Agent shall promptly notify the respective Borrower, and such
Borrower shall immediately pay such corresponding amount to the Agent. The Agent
shall also be entitled to recover from such Lender or such Borrower, as the case
may be, interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Agent to such Borrower
to the date such corresponding amount is recovered by the Agent, at a rate per
annum equal to (x) if paid by such Lender, the Federal Funds Effective Rate or
(y) if paid by such Borrower, the then applicable rate of interest, calculated
in accordance with Section 1.09, for the respective Loans.
(b) Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its commitments hereunder or to prejudice any rights which
any Borrower may have against any Lender as a result of any default by such
Lender hereunder.
1.06 Notes; etc.. (a) Each Borrower's obligation to pay the principal of
(or the Face Amount of, as the case may be), and interest on, all the Loans made
to such Borrower by each Lender shall be set forth in the Register maintained by
the Agent pursuant to Section 12.17 and shall, if requested by any Lender, also
be evidenced (i) if Dollar Revolving Loans, by a promissory note duly executed
and delivered by Workflow substantially in the form of Exhibit C-1, with blanks
appropriately completed in conformity herewith (each a "Dollar Revolving Note"
and, collectively, the "Dollar Revolving Notes"), (ii) if Canadian Revolving
Loans, by a promissory note duly executed and delivered by DBF substantially in
the form of Exhibit C-2, with blanks appropriately completed in conformity
herewith (each a "Canadian Revolving Note" and, collectively, the "Canadian
Revolving Notes"), and (iii) if Swingline Loans, by a promissory note duly
executed and delivered by Workflow substantially in the form of Exhibit C-3,
with blanks appropriately completed in conformity herewith (the "Swingline
Note"). The terms of each Competitive Bid Loan shall be evidenced by the
respective correspondence between Workflow and the respective Bidder Lender
pursuant to Section 1.04 and, unless otherwise agreed by Workflow and the
respective Bidder Lender or unless the respective Bidder Lender makes a request
pursuant to the immediately succeeding sentence, Competitive Bid
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Loans shall not be evidenced by promissory notes. If requested by any Lender,
(x) Workflow agrees to execute and deliver a promissory note, in form reasonably
satisfactory to the respective Lender, evidencing the Competitive Bid Loans of
such Lender to Workflow (with any such promissory notes herein called
"Competitive Bid Notes") and (y) each Borrower agrees to execute and deliver a
Dollar Revolving Note, a Canadian Revolving Note or the Swingline Note, as the
case may be, evidencing the Dollar Revolving Loans, the Canadian Revolving Loans
or the Swingline Loans, respectively, of such Lender to such Borrower.
(b) The Dollar Revolving Note issued to each Lender shall (i) be executed
by Workflow, (ii) be payable to the order of such Lender and be dated the
Effective Date (or, if issued to a Person that became a Lender after the
Effective Date, be dated the date of issuance thereof), (iii) be in a stated
principal amount equal to the Commitment of such Lender (or, if issued after the
termination thereof, be in a stated principal amount equal to the outstanding
Dollar Revolving Loans of such Lender at such time) and be payable in the
outstanding principal amount of the Dollar Revolving Loans evidenced thereby,
(iv) mature on the Final Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.09 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 4.01, and mandatory prepayment as
provided in Section 4.02, and (vii) be entitled to the benefits of this
Agreement and the other Credit Documents.
(c) The Canadian Revolving Note issued by DBF to each Lender that has a
Canadian Sub-Commitment or outstanding Canadian Revolving Loans shall (i) be
executed by DBF, (ii) be payable to the order of such Lender (or an Affiliate
thereof designated by such Lender) and be dated the Effective Date (or, if
issued to a Person that has become a Lender after the Effective Date, be dated
the date of issuance thereof), (iii) be in a stated principal amount (expressed
in Canadian Dollars) which exceeds by 25% the Canadian Dollar Equivalent (as of
the date of issuance) of the respective Lender's Canadian Sub-Commitment;
provided that if, because of fluctuations in exchange rates after the Effective
Date, the amount of the Canadian Revolving Note of DBF held by any Lender would
not be at least as great as the outstanding principal amount of, and the Face
Amount of, as applicable, Canadian Revolving Loans made by such Lender to DBF
and evidenced thereby, the respective Lender may request (and in such case DBF
shall promptly execute and deliver) a new Canadian Revolving Note in an amount
equal to the greater of (x) that amount (expressed in Canadian Dollars) which at
that time exceeds by 25% the Canadian Dollar Equivalent of the respective
Lender's Canadian Sub-Commitment or (y) the then outstanding principal amount
of, and the Face Amount of, as applicable, all Canadian Revolving Loans made by
such Lender to DBF, (iv) be payable in Canadian Dollars in the outstanding
principal amount of, and Face Amount of, as applicable, the Canadian Revolving
Loans made to DBF and evidenced thereby, (v) mature on the Final Maturity Date,
(vi) bear interest as provided in the appropriate clause of Section 1.09 in
respect of the Canadian Prime Rate Loans evidenced thereby, (vii) be subject to
voluntary prepayment as provided in Section 4.01, and mandatory prepayment as
provided in Section 4.02, and (viii) be entitled to the benefits of this
Agreement and the other Credit Documents.
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(d) The Swingline Note issued to BTCo shall (i) be executed by Workflow,
(ii) be payable to the order of BTCo and be dated the Effective Date, (iii) be
in a stated principal amount equal to the Maximum Swingline Amount and be
payable in the outstanding principal amount of the Swingline Loans evidenced
thereby, (iv) mature on the Swingline Expiry Date, (v) bear interest as provided
in Section 1.09 in respect of the Base Rate Loans evidenced thereby, (vi) be
subject to voluntary prepayment as provided in Section 4.01, and mandatory
prepayment as provided in Section 4.02, and (vii) be entitled to the benefits of
this Agreement and the other Credit Documents.
(e) Each Lender will note on its internal records the amount of each Loan
made by it to each Borrower and each payment in respect thereof and will prior
to any transfer of any of its Notes endorse on the reverse side thereof the
outstanding principal amount of Loans (including, without limitation, the Face
Amount of any Bankers' Acceptances) evidenced thereby. Failure to make any such
notation, or any error in such notation, shall not affect the respective
Borrower's obligations in respect of such Loans.
1.07 Conversions. (a) Workflow shall have the option to convert on any
Business Day all or a portion at least equal to the applicable Minimum Borrowing
Amount of the outstanding principal amount of Dollar Revolving Loans of one Type
into Borrowing of the other Type of Dollar Revolving Loans, provided that (i) no
conversion of Base Rate Loans into Eurodollar Loans may be made prior to the
Syndication Date except for a conversion made on the first day of a PSD Interest
Period, (ii) no partial conversion of a Borrowing of Eurodollar Loans shall
reduce the outstanding principal amount of the Eurodollar Loans made pursuant to
such Borrowing to less than the Minimum Borrowing Amount applicable thereto,
(iii) Base Rate Loans may only be converted into Eurodollar Loans if no Default
or Event of Default is in existence on the date of the conversion, and (iv)
Borrowings of Eurodollar Loans resulting from this Section 1.07 shall be limited
in number as provided in Section 1.02. Each such conversion shall be effected by
Workflow by giving the Agent at the Notice Office, prior to 11:00 A.M. (New York
time), at least three Business Days' (or one Business Day's in the case of a
conversion into Base Rate Loans) prior written notice (or telephonic notice
promptly confirmed in writing) (each a "Notice of Conversion") specifying the
Dollar Revolving Loans to be so converted, the Type of Dollar Revolving Loans to
be converted into and, if to be converted into a Borrowing of Eurodollar Loans,
the Interest Period to be initially applicable thereto. The Agent shall give
each Lender prompt notice of any such proposed conversion affecting any of such
Lender's Dollar Revolving Loans.
(b) Mandatory conversions of Bankers' Acceptance Loans into Canadian Prime
Rate Loans shall be made in the circumstances, and to the extent, provided in
clause (i) of Annex III. Except as otherwise provided in the immediately
preceding sentence and as provided in clause (i) of Annex III, Bankers'
Acceptance Loans shall not be permitted to be converted into Canadian Prime Rate
Loans, and Canadian Prime Rate Loans shall not be permitted to be converted into
Bankers' Acceptance Loans. However, subject to compliance with the terms and
conditions of this Agreement, DBF may from time to time repay Canadian Revolving
Loans of one Type made to it and, concurrently therewith, may borrow another
Type of Canadian Revolving Loans permitted to be incurred by it.
10
1.08 Pro Rata Borrowings. Subject to the provisions of Section 1.16(b) and
in the case of Mandatory Borrowings, Section 1.01(c)(C) and in the case of
Bankers' Acceptance Loans, clause (e) of Annex III, (i) all Borrowings of Dollar
Revolving Loans under this Agreement shall be made by the Lenders pro rata on
the basis of their Dollar Percentages and (ii) all Borrowings of Canadian
Revolving Loans under this Agreement shall be made by the Canadian Lenders pro
rata on the basis of their Canadian Percentages. It is understood that no Lender
shall be responsible for any default by any other Lender of its obligation to
make Loans hereunder and that each Lender shall be obligated to make the Loans
required to be made by it hereunder, regardless of the failure of any other
Lender to fulfill its commitments hereunder.
1.09 Interest. (a) Workflow agrees to pay interest in respect of the unpaid
principal amount of each Base Rate Loan made to it from the date of the
Borrowing thereof until the conversion or maturity (whether by acceleration or
otherwise) of such Base Rate Loan, at a rate per annum which shall at all times
be the sum of the Applicable Base Rate/Canadian Prime Rate Margin plus the Base
Rate, each as in effect from time to time.
(b) Workflow agrees to pay interest in respect of the unpaid principal
amount of each Eurodollar Loan made to it from the date of the Borrowing thereof
until the conversion or maturity (whether by acceleration or otherwise) of such
Eurodollar Loan at a rate per annum which shall, at all times during each
Interest Period applicable thereto, be the sum of the Applicable Eurodollar
Margin as in effect from time to time plus the relevant Eurodollar Rate for such
Interest Period.
(c) DBF agrees to pay interest in respect of the unpaid principal amount of
each Canadian Prime Rate Loan made to it from the date the proceeds thereof are
made available to it (which shall, in the case of a conversion pursuant to
clause (i) of Annex III, be deemed to be the date upon which a maturing Bankers'
Acceptance is converted into a Canadian Prime Rate Loan pursuant to said clause
(i), with the proceeds thereof to be equal to the full Face Amount of the
maturing Bankers' Acceptances) until the maturity thereof (whether by
acceleration or otherwise) at a rate per annum which shall be equal to the sum
of the Applicable Base Rate/Canadian Prime Rate Margin plus the Canadian Prime
Rate, each as in effect from time to time.
(d) With respect to Bankers' Acceptance Loans, Acceptance Fees shall be
payable in connection therewith as provided in clause (g) of Annex III. Until
maturity of the respective Banker's Acceptances, interest shall not otherwise be
payable with respect thereto.
(e) Workflow agrees to pay interest in respect of the unpaid principal
amount of each Competitive Bid Loan made to it from the date the proceeds
thereof are made available to it until the maturity thereof (whether by
acceleration or otherwise) at the rate or rates per annum specified pursuant to
Section 1.04(b) by the Bidder Lender or Bidder Lenders, as the case may be,
making such Competitive Bid Loan and accepted by Workflow pursuant to Section
1.04(c)(2).
(f) Overdue principal and, to the extent permitted by law, overdue interest
in respect of each Loan and any other overdue amount payable hereunder shall, in
each case, bear interest at a rate per annum (i) in the case of overdue
principal of, and interest or other amounts
11
owing with respect to, Canadian Revolving Loans and any other amounts owing in
Canadian Dollars, equal to 2% per annum in excess of the rate of interest
otherwise applicable to Canadian Prime Rate Loans from time to time, and (ii) in
all other cases, equal to the greater of (x) 2% per annum in excess of the rate
otherwise applicable to Base Rate Loans from time to time and (y) the rate which
is 2% in excess of the rate then borne by such Loans. Notwithstanding anything
to the contrary contained in this Section 1.09(f), so long as any Canadian
Revolving Loans are secured by Real Property located in Canada, overdue
principal in respect of any Canadian Revolving Loans shall bear interest at the
rate otherwise applicable thereto pursuant to Section 1.09(c) unless a higher
rate of interest is then permitted under applicable law, in which case such
higher rate of interest shall apply subject to the provisions of this Section
1.09(f).
(g) Interest shall accrue from and including the date of any Borrowing of
any Loan to but excluding the date of any repayment thereof and shall be payable
(i) in respect of each Base Rate Loan and Canadian Prime Rate Loan, quarterly in
arrears on the last Business Day of each April, July, October and January, (ii)
in respect of each Eurodollar Loan, on the last day of each Interest Period
applicable thereto and, in the case of an Interest Period of six months, on the
date occurring three months after the first day of such Interest Period, (iii)
in respect of each Competitive Bid Loan, at such times as specified in the
Notice of Competitive Bid Borrowing relating thereto and (iv) in respect of each
Loan (other than Bankers' Acceptances), on any prepayment or conversion (on the
amount prepaid or converted), at maturity (whether by acceleration or otherwise)
and, after such maturity, on demand, provided, that in the case of Dollar
Revolving Loans maintained as Base Rate Loans, interest shall not be payable
pursuant to the preceding clause (iv) at the time of any repayment or prepayment
thereof unless the respective repayment or prepayment is made in conjunction
with a permanent reduction of the Total Commitment.
(h) All computations of interest hereunder shall be made in accordance with
Section 12.07(b).
(i) The Agent, upon determining the Eurodollar Rate for any Borrowing of
Eurodollar Loans for any Interest Period, shall promptly notify Workflow and the
Lenders thereof. Each such determination shall, absent manifest error, be final
and conclusive and binding on all parties hereto.
1.10 Interest Periods. At the time Workflow gives a Notice of Borrowing or
Notice of Conversion in respect of the making of, or conversion into, a
Borrowing of Eurodollar Loans (in the case of the initial Interest Period
applicable thereto) or prior to 11:00 A.M. (New York time) on the third Business
Day prior to the expiration of an Interest Period applicable to a Borrowing of
Eurodollar Loans, Workflow shall have the right to elect, by giving the Agent
written notice (or telephonic notice promptly confirmed in writing), the
Interest Period applicable to such Borrowing, which Interest Period shall, at
the option of Workflow, be a one, two, three or six month period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
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(ii) the initial Interest Period for any Borrowing of Eurodollar Loans
shall commence on the date of such Borrowing (including the date of any
conversion from a Borrowing of Base Rate Loans) and each Interest Period
occurring thereafter in respect of such Borrowing shall commence on the day
on which the next preceding Interest Period expires;
(iii) if any Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period, such Interest Period shall end on the last Business Day of
such calendar month;
(iv) if any Interest Period would otherwise expire on a day which is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided, that if any Interest Period would
otherwise expire on a day which is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day;
(v) subject to the foregoing clauses (i) through (iv), only a one
month Interest Period shall be available to be selected prior to the
Syndication Date, with all Dollar Revolving Loans constituting Eurodollar
Loans during such period to be outstanding pursuant to a single Borrowing,
with all such Borrowings to commence and end on the same day;
(vi) no Interest Period may be elected if it would extend beyond the
Final Maturity Date; and
(vii) no Interest Period may be elected at any time when a Default or
an Event of Default is then in existence.
If upon the expiration of any Interest Period, Workflow has failed to, or is not
permitted to, elect a new Interest Period to be applicable to the respective
Borrowing of Eurodollar Loans as provided above, Workflow shall be deemed to
have elected to convert such Borrowing into a Borrowing of Base Rate Loans
effective as of the expiration date of such current Interest Period.
1.11 Increased Costs, Illegality, etc. (a) In the event that (x) in the
case of clauses (i) and (iv) below, the Agent or (y) in the case of clauses (ii)
and (iii) below, any Lender, shall have determined (which determination shall,
absent manifest error, be final and conclusive and binding upon all parties
hereto):
(i) on any date for determining the Eurodollar Rate for any Interest
Period, that, by reason of any changes arising after the date of this
Agreement affecting the interbank Eurodollar market, adequate and fair
means do not exist for ascertaining the applicable interest rate on the
basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loans or Competitive Bid Loans because of (x) any change
since the date of this Agreement in any
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applicable law, governmental rule, regulation, guideline, order or request
(whether or not having the force of law), or in the interpretation or
administration thereof and including the adoption or introduction of any
new law or governmental rule, regulation, guideline, order or request, such
as, for example, but not limited to: (A) a change in the basis of taxation
of payment to any Lender of the principal of or interest on the Loans, the
Notes or any other amounts payable hereunder (except for changes in the
rate of tax on, or determined by reference to, the net income or profits of
such Lender pursuant to the laws of the jurisdiction in which it is
organized or in which its principal office or applicable lending office is
located or any subdivision thereof or therein) or (B) a change in official
reserve requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the Eurodollar
Rate and/or (y) other circumstances since the date of this Agreement
affecting such Lender, the interbank Eurodollar market or the position of
such Lender in such market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan or Competitive Bid Loan has been made (x) unlawful by any law or
governmental rule, regulation or order, (y) impossible by compliance by any
Lender in good faith with any governmental request (whether or not having
force of law) or (z) impracticable as a result of a contingency occurring
after the date of this Agreement which materially and adversely affects the
interbank Eurodollar market; or
(iv) at any time that Canadian Dollars are not available in sufficient
amounts, as determined in good faith by the Agent, to fund any Borrowing of
Canadian Revolving Loans requested pursuant to Section 1.01;
then, and in any such event, the Agent (in the case of clause (i) or (iv) above)
or such Lender shall give notice (by telephone confirmed promptly in writing) to
the respective Borrower or Borrowers and (except in the case of clauses (i) and
(iv)) to the Agent of such determination (which notice the Agent shall promptly
transmit to each of the other Lenders). Thereafter (w) in the case of clause (i)
above, Eurodollar Loans shall no longer be available until such time as the
Agent notifies Workflow and the Lenders that the circumstances giving rise to
such notice by the Agent no longer exist, and any Notice of Borrowing or Notice
of Conversion given by Workflow with respect to Eurodollar Loans which have not
yet been incurred shall be deemed rescinded by Workflow, (x) in the case of
clause (ii) above, the respective Borrower or Borrowers agree to pay to such
Lender, upon written demand therefor (accompanied by the written notice referred
to below), such additional amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as shall be required to compensate such Lender
for such increased costs or reductions in amounts received or receivable
hereunder (a written notice as to the additional amounts owed to such Lender,
showing in reasonable detail the basis for the calculation thereof, submitted to
such Borrower or Borrowers by such Lender shall, absent manifest error, be final
and conclusive and binding upon all parties hereto), (y) in the case of clause
(iii) above, the respective Borrower or Borrowers shall take one of the actions
specified in Section 1.11(b) as promptly as possible and, in any event, within
the time period required by law and (z) in the case of clause (iv) above,
Canadian Revolving Loans (exclusive of Canadian Revolving Loans which have
theretofore been funded)
14
shall no longer be available until such time as the Agent notifies the Borrowers
and the Lenders that the circumstances giving rise to such notice by the Agent
no longer exist, and any Notice of Borrowing given by any Borrower with respect
to such Canadian Revolving Loans which have not been incurred shall be deemed
rescinded by the respective Borrower.
(b) At any time that any Eurodollar Loan or Competitive Bid Loan is
affected by the circumstances described in Section 1.11(a)(ii) or (iii), the
respective Borrower may (and in the case of a Eurodollar Loan or Competitive Bid
Loan affected pursuant to Section 1.11(a)(iii) the respective Borrower shall)
either (i) if the affected Eurodollar Loan or Competitive Bid Loan is then being
made pursuant to a Borrowing, cancel said Borrowing by giving the Agent
telephonic notice (confirmed promptly in writing) thereof on the same date that
such Borrower was notified by a Lender pursuant to Section 1.11(a)(ii) or
(iii)), or (ii) if the affected Eurodollar Loan or Competitive Bid Loan is then
outstanding, upon at least three Business Days' notice to the Agent, (A) in the
case of a Eurodollar Loan, require the affected Lender to convert each such
Eurodollar Loan into a Base Rate Loan (which conversion, in the case of the
circumstances described in Section 1.11(a)(iii), shall occur no later than the
last day of the Interest Period then applicable to such Eurodollar Loan (or such
earlier date as shall be required by applicable law)) and (B) in the case of a
Competitive Bid Loan, repay such Competitive Bid Loan in full; provided, that if
more than one Lender is affected at any time as described above in this clause
(b), then all affected Lenders must be treated the same pursuant to this Section
1.11(b).
(c) If any Lender shall have determined that after the date hereof, the
adoption, introduction or effectiveness of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Lender with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of increasing the amount of capital required or expected to be maintained
by such Lender or any corporation controlling such Lender based on the existence
of such Lender's Commitment or obligation hereunder, then from time to time,
upon written demand by such Lender (with a copy to the Agent), the Borrowers
jointly and severally shall pay to such Lender such additional amounts as shall
be required to compensate such Lender or such other corporation for the
increased cost to such Lender or such other corporation or the reduction in the
rate of return to such Lender or such other corporation as a result of such
increase of capital. In determining such additional amounts, each Lender will
act reasonably and in good faith and will use averaging and attribution methods
which are reasonable, provided that such Lender's determination of compensation
owing under this Section 1.11(c) shall, absent manifest error, be final and
conclusive and binding on all the parties hereto. Each Lender, upon determining
that any additional amounts will be payable pursuant to this Section 1.11(c),
will give prompt written notice thereof to the Borrowers, which notice shall
show in reasonable detail the basis for calculation of such additional amounts,
although the failure to give any such notice shall not release or diminish the
Borrowers' obligations to pay additional amounts pursuant to this Section
1.11(c) upon the subsequent receipt of such notice.
15
1.12 Compensation. The respective Borrower or Borrowers agree to compensate
each Lender, upon its written request (which request shall set forth in
reasonable detail the basis for requesting such compensation), for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Lender to fund its Eurodollar Loans
or Competitive Bid Loans but excluding loss of anticipated profit with respect
to any Loans) which such Lender may sustain: (i) if for any reason (other than a
default by such Lender or the Agent) a Borrowing of Eurodollar Loans or
Competitive Bid Loans does not occur on a date specified therefor in a Notice of
Borrowing, Notice of Competitive Bid Borrowing or Notice of Conversion (whether
or not withdrawn or deemed withdrawn pursuant to Section 1.11(a) or (b)); (ii)
if any repayment (including any repayment made pursuant to Section 4.01 or 4.02
or as a result of an acceleration of the Loans pursuant to Section 9) or
conversion of any Eurodollar Loans occurs on a date which is not the last day of
an Interest Period applicable thereto; (iii) if any repayment (including any
repayment made pursuant to Section 4.01 or 4.02 or as a result of an
acceleration of the Loans pursuant to Section 9) of any Competitive Bid Loans or
Bankers' Acceptance Loans occurs on a date which is not the maturity date of the
respective Competitive Bid Loans or Bankers' Acceptance, as the case may be;
(iv) if any prepayment of any Eurodollar Loans, Competitive Bid Loans or
Bankers' Acceptance Loans is not made on any date specified in a notice of
prepayment given by the respective Borrower or Borrowers; or (v) as a
consequence of (x) any other default by the Borrower or Borrowers to repay its
Loans when required by the terms of this Agreement or (y) an election made
pursuant to Section 1.11(b).
1.13 Lending Offices; Changes Thereto. (a) Each Lender may at any time or
from time to time designate, by written notice to the Agent to the extent not
already reflected on Annex II, one or more lending offices (which, for this
purpose, may include Affiliates of the respective Lender) for the various Loans
made, and Letters of Credit participated in, by such Lender (including by
designating a separate lending office (or Affiliate) to act as such with respect
to Dollar Loans and Letter of Credit Outstanding versus Canadian Revolving
Loans); provided that, for designations made after the Effective Date, to the
extent such designation shall result in increased costs under Section 1.11, 2.05
or 4.04 in excess of those which would be charged in the absence of the
designation of a different lending office (including a different Affiliate of
the respective Lender), then the Borrowers shall not be obligated to pay such
excess increased costs (although the Borrowers, in accordance with and pursuant
to the other provisions of this Agreement, shall be obligated to pay the costs
which would apply in the absence of such designation and any subsequent
increased costs of the type described above resulting from changes after the
date of the respective designation). Each lending office and Affiliate of any
Lender designated as provided above shall, for all purposes of this Agreement,
be treated in the same manner as the respective Lender (and shall be entitled to
all indemnities and similar provisions in respect of its acting as such
hereunder).
(b) Each Lender agrees that, upon the occurrence of any event giving rise
to the operation of Section 1.11(a)(ii) or (iii), 1.11(c), 2.05 or 4.04 with
respect to such Lender, it will, if requested by the applicable Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans or Letters of Credit affected by
such event; provided, that such designation is made on such terms that, in the
16
sole judgment of such Lender, such Lender and its lending office suffer no
economic, legal or regulatory disadvantage, with the object of avoiding the
consequences of the event giving rise to the operation of any such Section.
Nothing in this Section 1.13 shall affect or postpone any of the obligations of
any Borrower or the right of any Lender provided in Section 1.11, 2.05 or 4.04.
1.14 Replacement of Lenders. (a) (i) If any Lender becomes a Defaulting
Lender or otherwise defaults in its obligations to make Loans or fund Unpaid
Drawings, (ii) if any Lender refuses to consent to certain proposed changes,
waivers, discharges or terminations with respect to this Agreement which have
been approved by the Required Lenders as (and to the extent) provided in Section
12.12(b) or (iii) upon the occurrence of any event giving rise to the operation
of Section 1.11(a)(ii) or (iii), Section 1.11(c), Section 2.05 or Section 4.04
with respect to any Lender which results in such Lender charging to any Borrower
increased costs in excess of those being generally charged by the other Lenders,
the Borrowers shall have the right, in accordance with the requirements of
Section 12.04(b), if no Event of Default will exist after giving effect to such
replacement, to replace such Lender (the "Replaced Lender") with an Eligible
Transferee or Transferees, none of which shall constitute a Defaulting Lender at
the time of such replacement (collectively, the "Replacement Lender"), and each
of whom shall be reasonably acceptable to the Agent and the Letter of Credit
Issuer, provided that (A) at the time of any replacement pursuant to this
Section 1.14, the Replacement Lender shall enter into one or more Assignment and
Assumption Agreements pursuant to Section 12.04(b) (and with the assignment fee
payable pursuant to said Section 12.04(b) to be paid by the Replacement Lender)
pursuant to which the Replacement Lender shall acquire the entire Commitment
(including any Canadian Sub-Commitment) and all outstanding Loans of, and in
each case participations in Swingline Loans and Letters of Credit by, the
Replaced Lender and, in connection therewith, shall pay (x) to the Replaced
Lender in respect thereof an amount (in the respective currencies in which such
Obligations are denominated) equal to the sum of (I) an amount equal to the
principal of (including, without limitation, the Face Amount of Bankers'
Acceptance Loans), and all accrued interest on, all outstanding Loans of the
Replaced Lender, (II) an amount equal to all Unpaid Drawings that have been
funded by (and not reimbursed to) such Replaced Lender, together with all then
unpaid interest with respect thereto at such time and (III) an amount equal to
all accrued, but theretofore unpaid, Fees owing to the Replaced Lender pursuant
to Section 3.01, (y) to the Letter of Credit Issuer an amount equal to such
Replaced Lender's Dollar Percentage of any Unpaid Drawing (which at such time
remains an Unpaid Drawing) to the extent such amount was not theretofore funded
by such Replaced Lender and (z) to BTCo an amount equal to such Replaced
Lender's Dollar Percentage of any Mandatory Borrowing to the extent such amount
was not theretofore funded by such Replaced Lender and (B) all obligations of
the Borrowers owing to the Replaced Lender (other than those specifically
described in clause (A) above in respect of which the assignment purchase price
has been, or is concurrently being, paid) shall be paid in full to such Replaced
Lender concurrently with such replacement.
(b) Upon the execution of the respective Assignment and Assumption
Agreements, the payment of amounts referred to in clauses (A) and (B) of Section
1.14(a) and, if so requested by the Replacement Lender, delivery to the
Replacement Lender of the appropriate Note or Notes executed by the respective
Borrowers, the Replacement Lender shall become a Lender hereunder and the
Replaced Lender shall cease to constitute a Lender hereunder, except
17
with respect to indemnification provisions applicable to the Replaced Lender
under this Agreement (including, without limitation, Sections 1.11, 1.12, 2.05,
4.04, 12.01 and 12.06), which shall survive as to such Replaced Lender.
1.15 Bankers' Acceptance Provisions. The parties hereto agree that the
provisions of Annex III shall apply to all Bankers' Acceptances and Bankers'
Acceptance Loans created hereunder, and that the provisions of Annex III shall
be deemed incorporated by reference into this Agreement as if such provisions
were set forth in their entirety herein.
1.16 Special Provisions Regarding Canadian Revolving Loans. (a) On the
fifth Business Day after the occurrence of a Sharing Event, automatically (and
without the taking of any action) (x) all then outstanding Canadian Revolving
Loans shall be automatically converted into Dollar Revolving Loans (in an amount
equal to the Dollar Equivalent of the aggregate principal amount or Face Amount,
as the case may be, of the Canadian Revolving Loans on the date such Sharing
Event first occurred, which Dollar Revolving Loans (i) shall be owed by DBF,
(ii) shall thereafter be deemed to be Base Rate Loans and (iii) shall be
immediately due and payable on the date such Sharing Event has occurred) and (y)
all accrued and unpaid interest and other amounts owing with respect to such
Canadian Revolving Loans shall be immediately due and payable in Dollars, taking
the Dollar Equivalent of such accrued and unpaid interest and other amounts.
(b) Upon the occurrence of a Sharing Event, each Lender shall (and hereby
unconditionally and irrevocably agrees to) purchase and sell (in each case in
Dollars) undivided participating interests in the Revolving Loans outstanding
to, and any Unpaid Drawings owing by, each Borrower in such amounts so that each
Lender shall have a share of the outstanding Revolving Loans and Unpaid Drawings
then owing by each Borrower equal to its Percentage thereof. Upon any such
occurrence the Agent shall notify each Lender and shall specify the amount of
Dollars required from such Lender in order to effect the purchases and sales by
the various Lenders of participating interests in the amounts required above
(together with accrued interest with respect to the period for the last interest
payment date through the date of the Sharing Event plus any additional amounts
payable by any respective Borrower pursuant to Section 4.04 in respect of such
accrued but unpaid interest); provided, in the event that a Sharing Event shall
have occurred, each Lender shall be deemed to have purchased, automatically and
without request, such participating interests. Promptly upon receipt of such
request, each Lender shall deliver to the Agent (in immediately available funds
in Dollars) the net amounts as specified by the Agent. The Agent shall promptly
deliver the amounts so received to the various Lenders in such amounts as are
needed to effect the purchases and sales of participations as provided above.
Promptly following receipt thereof, each Lender which has sold participations in
any of its Revolving Loans (through the Agent) will deliver to each Lender
(through the Agent) which has so purchased a participating interest a
participation certificate dated the date of receipt of such funds and in such
amount. It is understood that the amount of funds delivered by each Lender shall
be calculated on a net basis, giving effect to both the sales and purchases of
participations by the various Lenders as required above.
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(c) Upon, and after, the occurrence of a Sharing Event (i) no further
Canadian Revolving Loans shall be made to DBF, (ii) all amounts from time to
time accruing with respect to, and all amounts from time to time payable on
account of, such Canadian Revolving Loans (including, without limitation, any
interest and other amounts which were accrued but unpaid on the date of such
purchase) shall be payable in Dollars as if such Canadian Revolving Loan had
originally been made in Dollars and shall be distributed by the relevant Lenders
(or their affiliates) to the Agent for the account of the Lenders which made
such Loans or are participating therein and (iii) the Canadian Sub-Commitments
of the various Canadian Lenders shall be automatically terminated.
Notwithstanding anything to the contrary contained above, the failure of any
Lender to purchase its participating interest in any Revolving Loans upon the
occurrence of a Sharing Event shall not relieve any other Lender of its
obligation hereunder to purchase its participating interests in a timely manner,
but no Lender shall be responsible for the failure of any other Lender to
purchase the participating interest to be purchased by such other Lender on any
date.
(d) If any amount required to be paid by any Lender pursuant to Section
1.16(b) is not paid to the Agent within one Business Day following the date upon
which such Lender receives notice from the Agent of the amount of its
participations required to be purchased pursuant to said Section 1.16(b), such
Lender shall also pay to the Agent on demand an amount equal to the product of
(i) the amount so required to be paid by such Lender for the purchase of its
participations times (ii) the daily average Federal Funds Effective Rate, during
the period from and including the date of request for payment to the date on
which such payment is immediately available to the Agent times (iii) a fraction
the numerator of which is the number of days that elapsed during such period and
the denominator of which is 360. If any such amount required to be paid by any
Lender pursuant to Section 1.16(b) is not in fact made available to the Agent
within three Business Days following the date upon which such Lender receives
notice from the Agent as to the amount of participations required to be
purchased by it, the Agent shall be entitled to recover from such Lender on
demand, such amount with interest thereon calculated from such request date at
the rate per annum applicable to Dollar Revolving Loans maintained as Base Rate
Loans hereunder. A certificate of the Agent submitted to any Lender with respect
to any amounts payable under this Section 1.16 shall be conclusive in the
absence of manifest error. Amounts payable by any Lender pursuant to this
Section 1.16 shall be paid to the Agent for the account of the relevant Lenders;
provided that, if the Agent (in its sole discretion) has elected to fund on
behalf of such Lender the amounts owing to such Lenders, then the amounts shall
be paid to the Agent for its own account.
(e) Whenever, at any time after the relevant Lenders have received from any
Lenders purchases of participations in any Revolving Loans pursuant to this
Section 1.16, the Lenders receive any payment of account thereof, such Lenders
will distribute to the Agent, for the account of the various Lenders
participating therein, such Lenders' participating interests in such amounts
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such participations were outstanding) in like funds as
received; provided, however, that in the event that such payment received by any
Lenders is required to be returned, the Lenders who received previous
distributions in respect of their participating interests therein
19
will return to the respective Lenders any portion thereof previously so
distributed to them in like funds as such payment is required to be returned by
the respective Lenders.
(f) Each Lender's obligation to purchase participating interests pursuant
to this Section 1.16 shall be absolute and unconditional and shall not be
affected by any circumstance including, without limitation, (a) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against any other Lender, the relevant Borrower or any other Person for any
reason whatsoever, (b) the occurrence or continuance of an Event of Default, (c)
any adverse change in the condition (financial or otherwise) of any Borrower or
any other Person, (d) any breach of this Agreement by any Borrower or any Lender
or any other Person, or (e) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
(g) Notwithstanding anything to the contrary contained elsewhere in this
Agreement, upon any purchase of participations as required above, each Lender
which has purchased such participations shall be entitled to receive from the
relevant Borrowers any increased costs and indemnities (including, without
limitation, pursuant to Sections 1.11, 1.12, 2.05 and 4.04) directly from the
Borrowers to the same extent as if it were the direct Lender as opposed to a
participant therein, which increased costs shall be calculated without regard to
Section 1.13, Section 12.04(a) or the last sentence of Section 12.04(b). The
Borrowers acknowledge and agree that, upon the occurrence of a Sharing Event and
after giving effect to the requirements of this Section 1.16, increased Taxes
may be owing by them pursuant to Section 4.04, which Taxes shall be paid (to the
extent provided in Section 4.04) by the respective Borrowers, without any claim
that the increased Taxes are not payable because same resulted from the
participations effected as otherwise required by this Section 1.16.
1.17 Certain Override Provisions Regarding Utilizations of the
Total Canadian Sub-Commitment. (a) Notwithstanding anything to the contrary
contained in this Agreement, the parties hereto agree that (i) the Total
Canadian Sub-Commitment shall be fixed on a quarterly basis in accordance with
this Section 1.17, (ii) in no event shall the Total Canadian Sub-Commitment
exceed the least of (x) $50,000,000, (y) the sum of the Canadian Sub-Commitments
of the various Canadian Lenders as then in effect (after giving effect to any
reductions to such Canadian Sub-Commitments from time to time, including
pursuant to Sections 3.02, 3.03 and/or 9) and (z) the Total Commitment then in
effect, (iii) in no event shall the Canadian Sub-Commitment for any Canadian
Lender exceed the amount set forth opposite such Canadian Lender's name in Annex
I-B directly below the column entitled "Canadian Sub-Commitment," as the same
may be reduced from time to time pursuant to Sections 3.02, 3.03 and/or 9 or as
the same may be further adjusted from time to time as a result of assignments to
or from such Lender pursuant to Section 1.14 or 12.04(b), (iv) at no time shall
Workflow be permitted to request an extension of credit pursuant to the Total
Commitment (whether in the form of Revolving Loans, Swingline Loans, Competitive
Bid Loans or Letter of Credit Outstandings) and no such credit shall be made
available if, after giving effect thereto, the sum of the aggregate principal
amount of outstanding Revolving Loans (excluding for this purpose Canadian
Revolving Loans), Swingline Loans and Competitive Bid Loans and the amount of
Letter of Credit Outstandings at such time would exceed an amount equal to the
Total
20
Commitment as then in effect less the Total Canadian Sub-Commitment as then in
effect, (v) at no time shall DBF be permitted to request an extension of credit
in the form of Canadian Revolving Loans if, after giving effect thereto, the
aggregate principal (and Face Amount, as applicable) of outstanding Canadian
Revolving Loans (for this purpose, using the Dollar Equivalent of the principal
and/or Face Amount, as appropriate, of Canadian Revolving Loans) would at any
time exceed the Total Canadian Sub-Commitment; and (vi) the Canadian
Sub-Commitment for any Canadian Lender at any time shall be an amount equal to
its pro rata share of the Total Canadian Sub-Commitment at such time determined
on the basis of the Canadian Percentages of the various Canadian Lenders. At all
times from and after the date of this Agreement until an adjustment is made in
accordance with this Section 1.17, the Total Canadian Sub-Commitment shall be
$25,000,000.
(b) Workflow, not more than 30 days and not less than 5 Business Days prior
to the last day of each calendar quarter, shall give written notice to the Agent
either (x) requesting an adjustment (subject to the limitations set forth in
clause (a) of this Section 1.17) effective as of the first Business Day of the
immediately following calendar quarter (each such date an "Adjustment Date") to
the amount of the Total Canadian Sub-Commitment; or (y) confirming that there
will be no adjustments to the amount available under the Total Canadian
Sub-Commitment, provided that (i) no reduction to the amount of the Total
Canadian Sub-Commitment may be made if, after giving effect to any such
reduction, the Total Canadian Sub-Commitment would be less than the sum of the
aggregate Face Amount of all Bankers' Acceptance Loans and the principal amount
of all Canadian Prime Rate Loans (for this purpose, using the Dollar Equivalent
of the Face Amounts or principal amounts thereof) then outstanding (other than
any such Canadian Revolving Loans which will be repaid in full on or before the
respective Adjustment Date) and (ii) the failure by Workflow to deliver any such
written notice (or the delivery by Workflow of any such notice which does not
comply with the requirements contained in this Section) to the Agent within the
period required above will be deemed to be delivery by Workflow to the Agent of
a written notice that there will be no adjustment to the Total Canadian
Sub-Commitment. If any adjustment is made on an Adjustment Date as described in
this Section, then on the respective Adjustment Date all repayments requested by
this Section and Section 4.02(a) shall be made on such date to the extent
required as a result of such adjustments and in manner provided in Section 4.02.
(c) In connection with any loans and/or repayments made as a result of
adjustments to the Total Canadian Sub-Commitment and the Canadian Sub-Commitment
for any Canadian Lender as requested above, then, so long as arrangements
satisfactory to the Agent are made for the repayment of all amounts which will
be due on the respective Adjustment Date as a result thereof, loans shall be
permitted to be requested by the Borrowers as a result of any change in the
amount of the Total Canadian Sub-Commitment on such date (subject to
satisfaction of the other terms and conditions of this Agreement) so long as
arrangements satisfactory to the Agent are made so that, by the time required by
Section 4.03, all payments will be made by the Borrowers on such Adjustment Date
as a result of any change in the amount of the Total Canadian Sub-Commitment, on
such date. It is understood and agreed that the Agent shall not have any
liability to any Lenders if the payments contemplated above in this Section are
not actually made on the Adjustment Date, and that any failure to make the
payments required to be
21
made on an Adjustment Date pursuant to this Section or Section 4.02(a) shall
constitute an Event of Default in accordance with the terms of Section 9.01.
SECTION 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the terms and conditions
set forth herein, Workflow may request the Letter of Credit Issuer at any time
and from time to time on or after the Effective Date and prior to the 30th day
prior to the Final Maturity Date to issue, for the account of Workflow and in
support of (x) trade obligations and other obligations of Workflow or any of its
Subsidiaries incurred in the ordinary course of business and (y) such other
obligations of Workflow or any of its Subsidiaries to any other Person that are
reasonably acceptable to the Agent and the Letter of Credit Issuer, and subject
to and upon the terms and conditions set forth herein, the Letter of Credit
Issuer agrees to issue from time to time, irrevocable letters of credit in such
form as may be approved by the Letter of Credit Issuer and the Agent (each such
letter of credit, a "Letter of Credit" and, collectively, the "Letters of
Credit").
(b) The Letter of Credit Issuer hereby agrees that it will (subject to the
terms and conditions contained herein), at any time and from time to time on and
after the Effective Date and prior to the 30th day prior to the Final Maturity
Date, following its receipt of the respective Letter of Credit Request, issue
for the account of Workflow, subject to the terms and conditions of this
Agreement, one or more Letters of Credit, provided that the Letter of Credit
Issuer shall be under no obligation to issue any Letter of Credit if at the time
of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain the Letter of
Credit Issuer from issuing such Letter of Credit or any requirement of law
applicable to the Letter of Credit Issuer or any request or directive
(whether or not having the force of law) from any governmental authority
with jurisdiction over the Letter of Credit Issuer shall prohibit, or
request that the Letter of Credit Issuer refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Letter of Credit Issuer with respect to such Letter of
Credit any restriction or reserve or capital requirement (for which the
Letter of Credit Issuer is not otherwise compensated) not in effect on the
date hereof, or any unreimbursed loss, cost or expense which was not
applicable, in effect or known to the Letter of Credit Issuer as of the
date hereof and which the Letter of Credit Issuer reasonably and in good
faith deems material to it; or
(ii) the Letter of Credit Issuer shall have received notice from
Workflow, any other Credit Party or the Required Lenders prior to the
issuance of such Letter of Credit of the type described in clause (v) of
Section 2.01(c).
Notwithstanding anything to the contrary contained in this Agreement, Workflow,
the Letter of Credit Issuer and each of the other Lenders hereby acknowledge and
agree that the letter of credit, dated May 13, 1997, in the stated amount of
$1,000,000 and having the number S-11882 which was issued by the Letter of
Credit Issuer for the account of U.S. Office Products and for the benefit of
Toronto Dominion Bank under U.S. Office Products' previous credit agreement
22
agented by the Letter of Credit Issuer shall for all purposes of this Agreement
be deemed to be a Letter of Credit issued under this Agreement for the account
of Workflow on the Effective Date and Workflow shall be fully obligated with
respect thereto. In addition, Workflow hereby authorizes the Letter of Credit
Issuer to amend such Letter of Credit to reflect that the account party is now
Workflow instead of U.S. Office Products.
(c) Notwithstanding the foregoing, (i) no Letter of Credit shall be issued
the Stated Amount of which, when added to the Letter of Credit Outstandings at
such time, would exceed $5,000,000, (ii) no Letter of Credit shall be issued if,
after giving effect thereto, the Aggregate Revolving Credit Exposure would
exceed the Total Commitment at such time, (iii) each Letter of Credit shall have
an expiry date occurring not later than the earlier of (x) one year (or 180 days
in the case of a trade Letter of Credit) after such Letter of Credit's date of
issuance, provided that any standby Letter of Credit may be automatically
extendible for periods of up to one year so long as such standby Letter of
Credit provides that the Letter of Credit Issuer retains an option, satisfactory
to the Letter of Credit Issuer, to terminate such standby Letter of Credit
within a specified period of time prior to each scheduled extension date and (y)
the fifth Business Day (or the 30th day in the case of trade Letters of Credit)
prior to the Final Maturity Date, (iv) each Letter of Credit shall be
denominated in Dollars and issued on a sight basis, and (v) the Letter of Credit
Issuer will not issue any Letter of Credit after it has received written notice
from Workflow, any other Credit Party or the Required Lenders stating that a
Default or an Event of Default exists until such time as the Letter of Credit
Issuer shall have received a written notice of (x) rescission of such notice
from the party or parties originally delivering same or (y) a waiver of such
Default or Event of Default by the Required Lenders.
(d) Notwithstanding the foregoing, in the event a Lender Default exists,
the Letter of Credit Issuer shall not be required to issue any Letter of Credit
unless the Letter of Credit Issuer has entered into arrangements satisfactory to
it and Workflow to eliminate the Letter of Credit Issuer's risk with respect to
the participation in Letters of Credit of any Defaulting Lender or Lenders,
including by cash collateralizing any such Defaulting Lender's or Lenders'
Percentage of the Letter of Credit Outstandings.
2.02 Letter of Credit Requests; Notices of Issuance. (a) Whenever Workflow
desires that a Letter of Credit be issued, Workflow shall give the Agent and the
Letter of Credit Issuer written notice thereof prior to 11:00 A.M. (New York
time) at least five Business Days (or such shorter period as may be acceptable
to the Letter of Credit Issuer) prior to the proposed date of issuance (which
shall be a Business Day), which notice shall be in the form of Exhibit A-2
appropriately completed (each a "Letter of Credit Request"). Each Letter of
Credit Request shall include any other documents as the Letter of Credit Issuer
customarily requires in connection therewith.
(b) The making of each Letter of Credit Request shall be deemed to be a
representation and warranty by Workflow that (i) such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.01(c) and (ii) all of the applicable conditions set forth in Section 5 shall
be met at the time of such issuance. Unless the Letter of Credit Issuer has
received notice from Workflow, any other Credit Party or the Required
23
Lenders before it issues a Letter of Credit that one or more of the conditions
specified in Section 5 are not then satisfied, or that the issuance of such
Letter of Credit would violate Section 2.01(c), then the Letter of Credit Issuer
may issue the requested Letter of Credit for the account of Workflow in
accordance with the Letter of Credit Issuer's usual and customary practices.
(c) The Letter of Credit Issuer shall, promptly upon its issuance of a
Letter of Credit, give the Agent and Workflow written notice thereof, in each
case accompanied by a copy to the Agent of the Letter of Credit or Letters of
Credit issued by the Letter of Credit Issuer.
2.03 Agreement to Repay Letter of Credit Drawings. (a) Workflow hereby
agrees to reimburse the Letter of Credit Issuer, by making payment to the Agent
in Dollars and in immediately available funds at the appropriate Payment Office,
for any payment or disbursement made by the Letter of Credit Issuer under any
Letter of Credit (each such amount so paid or disbursed until reimbursed, an
"Unpaid Drawing") promptly upon but no later than one Business Day after the
Letter of Credit Issuer notifies Workflow that such payment or disbursement has
occurred (provided that no such notice shall be required to be given if a
Default or an Event of Default under Section 9.05 shall have occurred and be
continuing, in which case the Unpaid Drawing shall be due and payable
immediately without presentment, demand, protest or notice of any kind (all of
which are hereby waived by Workflow)), with interest on the amount so paid or
disbursed by the Letter of Credit Issuer, to the extent not reimbursed prior to
12:00 Noon (New York time) on the date of such payment or disbursement, from and
including the date paid or disbursed to but not including the date the Letter of
Credit Issuer is reimbursed therefor at a rate per annum which shall be the
Applicable Base Rate/Canadian Prime Rate Margin plus the Base Rate, each as in
effect from time to time (plus an additional 2% per annum if not reimbursed by
the third Business Day after the date of such notice of such payment or
disbursement or following the occurrence of a Default or an Event of Default
under Section 9.05), with such interest to be payable on demand.
(b) Workflow's obligation under this Section 2.03 to reimburse the Letter
of Credit Issuer with respect to Unpaid Drawings (including, in each case,
interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which Workflow or any of its Subsidiaries may have or have had against the
Letter of Credit Issuer, the Agent, any Lender, the beneficiary of any Letter of
Credit or any other Person, including, without limitation, any defense based
upon the failure of any drawing under a Letter of Credit to conform to the terms
of the Letter of Credit or any non-application or misapplication by the
beneficiary of the proceeds of such drawing, provided that Workflow shall not be
obligated to reimburse the Letter of Credit Issuer for any wrongful payment made
by the Letter of Credit Issuer under a Letter of Credit as a result of acts or
omissions constituting willful misconduct or gross negligence on the part of the
Letter of Credit Issuer (as finally determined by a court of competent
jurisdiction).
2.04 Letter of Credit Participations. (a) Immediately upon the issuance by
the Letter of Credit Issuer of any Letter of Credit, the Letter of Credit Issuer
shall be deemed to have sold and transferred to each other Lender, and each such
Lender (each a "Participant") shall be deemed irrevocably and unconditionally to
have purchased and received from the Letter of Credit
24
Issuer, without recourse or warranty, an undivided interest and participation,
to the extent of such Lender's Dollar Percentage, in such Letter of Credit, each
substitute letter of credit, each drawing made thereunder and the obligations of
Workflow under this Agreement with respect thereto (although Letter of Credit
Fees shall be payable directly to the Agent for the account of the Lenders as
provided in Section 3.01(b) and the Participants shall have no right to receive
any portion of any Facing Fees) and any security therefor or guaranty pertaining
thereto; provided that, upon the occurrence of a Sharing Event, the
participations described above in this Section 2.04(a) shall be automatically
adjusted so that each Lender shall have a participation in all then outstanding
Letters of Credit, and related obligations as described above, in a percentage
equal to its Percentage (which adjustments shall occur concurrently with the
adjustments described in Section 1.16). Upon any change in the Commitments or
Dollar Percentages of the Lenders pursuant to this Agreement (or in the
circumstances provided in the proviso to the immediately preceding sentence,
upon any change in the Percentages of the Lenders pursuant to this Agreement),
it is hereby agreed that, with respect to all outstanding Letters of Credit and
Unpaid Drawings, there shall be an automatic adjustment to the participations
pursuant to this Section 2.04 to reflect the new Dollar Percentages or, in the
circumstances described in the proviso to the immediately preceding sentence,
the new Percentages of the various Lenders.
(b) In determining whether to pay under any Letter of Credit, the Letter of
Credit Issuer shall not have any obligation relative to the Participants other
than to determine that any documents required to be delivered under such Letter
of Credit have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by the Letter of Credit Issuer under or in connection with
any Letter of Credit, if taken or omitted in the absence of gross negligence or
willful misconduct (as finally determined by a court of competent jurisdiction),
shall not create for the Letter of Credit Issuer any resulting liability to any
Person.
(c) In the event that the Letter of Credit Issuer makes any payment under
any Letter of Credit and Workflow shall not have reimbursed such amount in full
to the Letter of Credit Issuer pursuant to Section 2.03(a), the Letter of Credit
Issuer shall promptly notify the Agent, and the Agent shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to the Agent for the account of the Letter of Credit Issuer,
the amount of such Participant's Dollar Percentage (or, after the occurrence of
a Sharing Event, its Percentage) of such payment in Dollars and in same day
funds, provided that no Participant shall be obligated to pay to the Agent its
Dollar Percentage (or Percentage, as the case may be) of such unreimbursed
amount for any wrongful payment made by the Letter of Credit Issuer under a
Letter of Credit as a result of acts or omissions constituting willful
misconduct or gross negligence on the part of the Letter of Credit Issuer (as
finally determined by a court of competent jurisdiction). If the Agent so
notifies any Participant required to fund a payment under a Letter of Credit
prior to 11:00 A.M. (New York time) on any Business Day, such Participant shall
make available to the Agent for the account of the Letter of Credit Issuer such
Participant's Dollar Percentage (or, after the occurrence of a Sharing Event,
its Percentage) of the amount of such payment on such Business Day in Dollars
and in same day funds. If and to the extent such Participant shall not have so
made its Dollar Percentage (or Percentage, as the case may be) of the amount of
such payment available to the Agent for the account of the Letter of
25
Credit Issuer, such Participant agrees to pay to the Agent for the account of
the Letter of Credit Issuer, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Agent for the account of the Letter of Credit Issuer at the Federal Funds
Effective Rate. The failure of any Participant to make available to the Agent
for the account of the Letter of Credit Issuer its Dollar Percentage (or, after
the occurrence of a Sharing Event, its Percentage) of any payment under any
Letter of Credit shall not relieve any other Participant of its obligation
hereunder to make available to the Agent for the account of the Letter of Credit
Issuer its Dollar Percentage (or Percentage, as the case may be) of any payment
under any Letter of Credit on the date required, as specified above, but no
Participant shall be responsible for the failure of any other Participant to
make available to the Agent for the account of the Letter of Credit Issuer such
other Participant's Dollar Percentage (or Percentage, as the case may be) of any
such payment.
(d) Whenever the Letter of Credit Issuer receives a payment of a
reimbursement obligation as to which the Agent has received for the account
of the Letter of Credit Issuer any payments from the Participants pursuant to
clause (c) above, the Letter of Credit Issuer shall pay to the Agent and the
Agent shall promptly pay to each Participant which has paid its Dollar
Percentage thereof (or, after the occurrence of a Sharing Event, its
Percentage thereof), in Dollars and in same day funds, an amount equal to
such Participant's Dollar Percentage (or Percentage, as the case may be) of
the principal amount thereof and interest thereon accruing after the actual
funding of the respective participations.
(e) The obligations of the Participants to make payments to the Agent for
the account of the Letter of Credit Issuer with respect to Letters of Credit
shall be irrevocable and not subject to counterclaim, set-off or other defense
or any other qualification or exception whatsoever (except as otherwise
expressly provided in the proviso to the first sentence in Section 2.04(c)) and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or any of
the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other right which
Workflow or any of its Subsidiaries may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit, any Lender or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying transaction between
Workflow or any such Subsidiary and the beneficiary named in any such
Letter of Credit);
(iii) any draft, certificate or other document presented under the
Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
26
(v) the occurrence of any Default or Event of Default.
2.05 Increased Costs. If at any time after the date hereof, the adoption,
introduction or effectiveness of any applicable law, rule or regulation, or any
change therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by the Letter of Credit
Issuer or any Participant with any request or directive (whether or not having
the force of law) by any such authority, central bank or comparable agency shall
either (i) impose, modify or make applicable any reserve, deposit, capital
adequacy or similar requirement against Letters of Credit issued by the Letter
of Credit Issuer or such Participant's participation therein, or (ii) impose on
the Letter of Credit Issuer or any Participant any other conditions affecting
this Agreement, any Letter of Credit or such Participant's participation
therein; and the result of any of the foregoing is to increase the cost to the
Letter of Credit Issuer or such Participant of issuing, maintaining or
participating in any Letter of Credit, or to reduce the amount of any sum
received or receivable by the Letter of Credit Issuer or such Participant
hereunder or reduce the rate of return on its capital with respect to Letters of
Credit, then, upon written demand to Workflow by the Letter of Credit Issuer or
such Participant (a copy of which demand shall be sent by the Letter of Credit
Issuer or such Participant to the Agent), Workflow shall pay to the Letter of
Credit Issuer or such Participant such additional amount or amounts as will
compensate the Letter of Credit Issuer or such Participant for such increased
cost or reduction. A certificate submitted to Workflow by the Letter of Credit
Issuer or such Participant, as the case may be (a copy of which certificate
shall be sent by the Letter of Credit Issuer or such Participant to the Agent),
setting forth the basis for the determination of such additional amount or
amounts necessary to compensate the Letter of Credit Issuer or such Participant
as aforesaid shall be final and conclusive and binding on Workflow absent
manifest error, although the failure to deliver any such certificate shall not
release or diminish Workflow's obligations to pay additional amounts pursuant to
this Section 2.05 upon subsequent receipt of such certificate.
SECTION 3. Fees; Adjustments of Commitments.
3.01 Fees. (a) Workflow agrees to pay to the Agent for distribution to each
Non-Defaulting Lender a commitment fee (the "Commitment Fee") for the period
from the Effective Date to but not including the date the Total Commitment has
been terminated, computed for each day at a rate per annum equal to the
Applicable Commitment Fee Percentage (as in effect from time to time) on the
daily average Unutilized Commitment of such Lender. Accrued Commitment Fees
shall be due and payable quarterly in arrears on the last Business Day of each
April, July, October and January of each year and the date upon which the Total
Commitment has been terminated.
(b) Workflow agrees to pay to the Agent for distribution to each Lender
(based on its Dollar Percentage or, for periods from and after the occurrence of
a Sharing Event, its Percentage), a fee in respect of each Letter of Credit (the
"Letter of Credit Fee") for the period from and including the date of issuance
of such Letter of Credit to and including the date of termination or expiration
of such Letter of Credit, computed for each day at a rate per annum
27
equal to the Applicable Eurodollar Margin (as in effect from time to time) on
the daily average Stated Amount of such Letter of Credit. Accrued Letter of
Credit Fees shall be due and payable quarterly in arrears on the last Business
Day of each April, July, October and January of each year and on the first day
on or after the termination of the Total Commitment upon which no Letters of
Credit remain outstanding.
(c) Workflow agrees to pay directly to the Letter of Credit Issuer for the
account of the Letter of Credit Issuer a fee in respect of each Letter of Credit
(the "Facing Fee") for the period from and including the date of issuance of
such Letter of Credit to and including the date of termination or expiration of
such Letter of Credit, computed for each day at a rate per annum equal to 1/4 of
1% on the daily average Stated Amount of such Letter of Credit, provided that in
no event shall the annual Facing Fee with respect to any Letter of Credit be
less than $500. Accrued Facing Fees shall be due and payable quarterly in
arrears on the last Business Day of each April, July, October and January of
each year and on the first day on or after the termination of the Total
Commitment upon which no Letters of Credit remain outstanding.
(d) Workflow agrees to pay directly to the Letter of Credit Issuer upon
each issuance of, payment under, and/or amendment of, a Letter of Credit issued
by it such amount as shall at the time of such issuance, payment or amendment be
the administrative charge which the Letter of Credit Issuer is customarily
charging for issuances of, payments under or amendments of comparable letters of
credit issued by it.
(e) At the time of the incurrence of each Bankers' Acceptance Loan,
Acceptance Fees shall be paid by DBF as required by, and in accordance with,
clause (g) of Annex III.
(f) Each Borrower agrees to pay to the Agent, for its own account, such
other fees as have been agreed to in writing from time to time by such Borrower
and the Agent.
(g) All computations of Fees shall be made in accordance with Section
12.07(b).
3.02 Voluntary Reduction of Commitments. (a) Upon at least three Business
Days' prior written notice to the Agent at the Notice Office (which notice the
Agent shall promptly transmit to each of the Lenders), Workflow shall have the
right, without premium or penalty, to terminate or partially reduce the
Unutilized Total Commitment, which notice shall specify the portion of the
specified reduction which shall apply to the Unutilized Acquisition Sub-Limit as
required by the definition of Acquisition Sub-Limit, provided that any partial
reduction pursuant to this Section 3.02(a) shall be in the amount of at least
$5,000,000 or any integral of $1,000,000 in excess thereof. Each reduction to
the Unutilized Total Commitment pursuant to this Section 3.02(a) shall apply to
permanently reduce the Commitments of the various Lenders pro rata based on
their respective Percentages. At the time of each reduction to the Commitment of
any Lender pursuant to this Section 3.02(a), Workflow shall specify the amount
of such reduction to apply to the Canadian Sub-Commitment of such Lender and to
the Dollar Sub-Commitment of such Lender (the sum of which must equal the
reduction to the Commitment of such Lender); provided that all Lenders with
Canadian Sub-Commitments shall be treated in a consistent fashion (i.e., with no
reductions, or with proportionate reductions, to their respective Canadian
Sub-Commitments) at the time of any reduction to the Unutilized Total
28
Commitment pursuant to this Section 3.02(a). In the absence of a designation by
Workflow pursuant to this Section 3.02, the amount of any reduction to the
Commitment of any Lender pursuant to this Section 3.02 shall apply (i) first, to
reduce the Dollar Sub-Commitment of the respective Lender and (ii) second, to
the extent in excess thereof, to reduce the Canadian Sub-Commitment of such
Lender in each case on a pro rata basis.
(b) On any date Workflow may, at its option, permanently reduce or
terminate the Canadian Sub-Commitments by written notice to the Agent to such
effect (specifying the aggregate amount of reductions to the Canadian
Sub-Commitments); provided that (i) no such reduction shall be made in an amount
which would cause the Dollar Equivalent of the then outstanding aggregate
principal amount or Face Amount, as the case may be, of the Canadian Revolving
Loans to exceed the Canadian Sub-Commitments of the Canadian Lenders after
giving effect to the respective reduction pursuant to this clause (b), (ii) each
reduction pursuant to this clause (b) shall apply pro rata to reduce the
Canadian Sub-Commitments of the various Canadian Lenders (based upon the
relative amounts of such Canadian Sub-Commitments) and (iii) except to the
extent the reduction to the Canadian Sub-Commitments pursuant to this Section
3.02(b) is accompanied by a like reduction to the amount of the Total Commitment
pursuant to Section 3.02(a), the amount of each Lender's reduction to its
Canadian Sub-Commitment pursuant to this clause (b) shall result in a like
increase to its Dollar Sub-Commitment.
3.03 Mandatory Adjustments of Commitments, etc. (a) The Total Commitment
shall terminate on the Commitment Expiration Date unless the Effective Date has
occurred on or before such date.
(b) The Total Commitment shall terminate on the earlier of (i) the date on
which a Change of Control occurs and (ii) the Final Maturity Date.
(c) On the date of receipt by Workflow and/or any of its Subsidiaries of
Cash Proceeds from any Asset Sale, the Total Commitment shall be permanently
reduced on such date by an amount equal to the Net Cash Proceeds from such Asset
Sale, provided that such reduction shall not be required to the extent that
Workflow elects, as hereinafter provided, to cause such Net Cash Proceeds to be
reinvested in Reinvestment Assets (such election, together with any election
made pursuant to Section 3.03(d), a "Reinvestment Election"). Workflow may
exercise its Reinvestment Election with respect to an Asset Sale if (x) no
Default or Event of Default exists and (y) Workflow delivers a Reinvestment
Notice to the Agent on the date of the consummation of the respective Asset
Sale, with such Reinvestment Election being effective with respect to the Net
Cash Proceeds from such Asset Sale equal to the Anticipated Reinvestment Amount
specified in such Reinvestment Notice.
(d) On the Business Day following the date of receipt by Workflow and/or
any of its Subsidiaries of Cash Proceeds from any Recovery Event, the Total
Commitment shall be permanently reduced on such date by an amount equal to the
Net Insurance Proceeds from such Recovery Event, provided that such reduction
shall not be required to the extent that Workflow elects, as hereinafter
provided, to cause such Net Insurance Proceeds to be reinvested in
29
Reinvestment Assets. Workflow may exercise its Reinvestment Election with
respect to a Recovery Event if (x) no Default or Event of Default exists and (y)
Workflow delivers a Reinvestment Notice to the Agent on the Business Day
following the date of Workflow's or its respective Subsidiary's receipt of the
proceeds from the respective Recovery Event, with such Reinvestment Election
being effective with respect to the Net Insurance Proceeds from such Recovery
Event equal to the Anticipated Reinvestment Amount specified in such
Reinvestment Notice.
(e) The Total Commitment shall be permanently reduced on the Reinvestment
Reduction Date with respect to a Reinvestment Election, in an amount equal to
the Reinvestment Reduction Amount, if any, with respect to such Reinvestment
Election.
(f) On the date of receipt by Workflow and/or any of its Subsidiaries of
cash proceeds from the incurrence of Indebtedness for borrowed money by Workflow
and/or any of its Subsidiaries (other than Indebtedness permitted by Section
8.04 as in effect on the Effective Date), the Total Commitment shall be
permanently reduced on such date by an amount equal to the cash proceeds from
such incurrence of Indebtedness (net of underwriting discounts and commissions
and other reasonable costs associated therewith).
(g) Each reduction of the Total Commitment pursuant to this Section 3.03
shall apply to proportionally and permanently reduce the Commitment of each
Lender. At the time of each reduction to the Commitment of any Lender pursuant
to this Section 3.03, Workflow shall specify the amount of such reduction to
apply to the Canadian Sub-Commitment of such Lender and to the Dollar
Sub-Commitment of such Lender (the sum of which must equal the reduction to the
Commitment of such Lender); provided that all Lenders with Canadian
Sub-Commitments shall be treated in a consistent fashion (i.e., with no
reductions, or with proportionate reductions, to their respective Canadian
Sub-Commitments) at the time of any reduction to the Total Commitment pursuant
to this Section 3.03. In the absence of a designation by Workflow pursuant to
this Section 3.03, the amount of any reduction to the Commitment of any Lender
pursuant to this Section 3.03 shall apply (i) first, to reduce the Dollar
Sub-Commitment of the respective Lender and (ii) second, to the extent in excess
thereof, to reduce the Canadian Sub-Commitments of such Lender in each case on a
pro rata basis.
SECTION 4. Payments.
4.01 Voluntary Prepayments. Each Borrower shall have the right to prepay
the Loans made to it, in whole or in part, without premium or penalty, from time
to time on the following terms and conditions:
(i) such Borrower shall give the Agent at the Notice Office written
notice (or telephonic notice promptly confirmed in writing) of its intent
to prepay the Loans, whether Dollar Revolving Loans, Canadian Revolving
Loans or Swingline Loans shall be prepaid, the amount of such prepayment
and the Types of Loans to be prepaid and (in the case of Eurodollar Loans)
the specific Borrowing(s) pursuant to which made, which notice shall be
given by the respective Borrower prior to 12:00 Noon (New York time) at
least three Business Days (or, in the case of Base Rate Loans or Canadian
Prime Rate
30
Loans, at least one Business Day) prior to the date of such prepayment,
which notice shall, except in the case of Swingline Loans, promptly be
transmitted by the Agent to each of the Lenders;
(ii) each prepayment shall be in an aggregate principal amount of at
least $1,000,000 (or Cdn $1,000,000 in the case of Canadian Prime Rate
Loans or (y) $250,000 in the case of Swingline Loans), provided that no
partial prepayment of Eurodollar Loans made pursuant to a Borrowing shall
reduce the aggregate principal amount of the Eurodollar Loans outstanding
pursuant to such Borrowing to an amount less than the Minimum Borrowing
Amount applicable thereto;
(iii) each prepayment in respect of any Revolving Loans made pursuant
to a Borrowing shall be applied pro rata among such Revolving Loans;
(iv) prepayments of Bankers' Acceptance Loans may not be made prior to
the maturity date of the respective Bankers' Acceptances;
(v) with respect to each prepayment in respect of any Revolving Loans
made pursuant to this Section 4.01, such prepayment shall, unless otherwise
directed by the respective Borrower at the time of prepayment, first be
deemed to be applied to any outstanding Acquisition Loans and then to any
outstanding Working Capital Loans; and
(vi) no Competitive Bid Loan may be prepaid without the consent of the
Lender that made such Competitive Bid Loan.
4.02 Mandatory Prepayments. (a) (i) If on any day the Aggregate Revolving
Credit Exposure exceeds the Total Commitment as then in effect, Workflow shall
prepay on such day the principal of outstanding Swingline Loans and, after all
Swingline Loans have been prepaid in full or if no Swingline Loans are
outstanding, the Borrowers shall prepay on such day the principal of outstanding
Revolving Loans (other than Bankers' Acceptance Loans where the underlying
Bankers Acceptances have not yet matured) (allocated between Dollar Revolving
Loans and Canadian Revolving Loans, as the Borrowers may elect) in an amount
(for this purpose, using the Dollar Equivalent of payments in Canadian Dollars
made with respect to Canadian Revolving Loans) equal to such excess. If, after
giving effect to the prepayment of all outstanding Swingline Loans and Revolving
Loans (other than Bankers' Acceptance Loans as referenced in the immediately
preceding sentence), the sum of the outstanding Bankers' Acceptance Loans (for
this purpose, using the Dollar Equivalent of the Face Amounts thereof),
Competitive Bid Loans and Letter of Credit Outstandings exceeds the Total
Commitment then in effect, (i) an amount of cash and/or Cash Equivalents equal
to the lesser of such excess and the then outstanding Face Amount of all
Bankers' Acceptances shall be deposited by DBF with the Agent as collateral for
the obligations of DBF to the Canadian Lenders (rounded up to the nearest
integral multiple of Cdn.$100,000) in respect of an equivalent Face Amount of
outstanding Bankers' Acceptances accepted by the Canadian Lenders which shall be
paid to and applied by the Canadian Lenders, in satisfaction of the obligations
of DBF to the Canadian Lenders in respect of such Banker's Acceptances, on the
maturity date thereof, (ii) to the extent such excess exceeds the amount applied
pursuant to preceding clause (i), cash and/or Cash Equivalents in an
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amount equal to such remaining excess or, if less, an amount equal to the then
outstanding principal amount of Competitive Bid Loans shall be paid by Workflow
to the Agent to be held as collateral for the repayment of such Competitive Bid
Loans at maturity and (iii) to the extent such excess exceeds the amount applied
pursuant to preceding clauses (i) and (ii), Workflow shall pay to the Agent cash
and/or Cash Equivalents in an amount equal to the amount of such excess (less
the amount applied pursuant to preceding clauses (i) and (ii)) (up to a maximum
amount equal to the Letter of Credit Outstandings at such time), such cash
and/or Cash Equivalents to be held as security for all obligations of Workflow
hereunder and under the other Credit Documents in a cash collateral account (and
invested from time to time in Cash Equivalents selected by the Agent) to be
established by the Agent.
(ii) If on any day the Dollar Equivalent of the aggregate outstanding
principal amount (or Face Amount, as the case may be) of Canadian Revolving
Loans made to DBF exceeds the Total Canadian Sub-Commitment as then in effect,
DBF shall prepay on such day principal of outstanding Canadian Revolving Loans
(other than Bankers' Acceptance Loans where the underlying Bankers' Acceptances
have not yet matured) in an amount equal to such excess. If, after giving effect
to the prepayment in full of all such outstanding Canadian Revolving Loans other
than the Bankers' Acceptance Loans referenced in the immediately preceding
sentence, the aggregate outstanding Face Amount of Bankers' Acceptance Loans
exceeds the Total Canadian Sub-Commitment as then in effect, DBF shall pay to
the Agent on such day an amount of cash and/or Cash Equivalents equal to the
amount of such excess (rounded up to the nearest integral multiple of Cdn.
$100,000), such cash and/or Cash Equivalents to be held as cash collateral for
the obligations of DBF to the Canadian Lenders in respect of an equivalent Face
Amount of outstanding Bankers' Acceptances accepted by the Canadian Lenders
which shall be paid to and applied by the Canadian Lenders, in satisfaction of
the obligations of DBF to the Canadian Lenders in respect of such Bankers'
Acceptances, on the maturity date thereof.
(iii) If on any day the aggregate outstanding principal amount of
Dollar Revolving Loans, Competitive Bid Loans and Swingline Loans made to
Workflow and the aggregate amount of all Letter of Credit Outstandings at such
time exceeds an amount equal to the Total Dollar Sub-Commitment as then in
effect, Workflow shall prepay on such day the principal of outstanding Swingline
Loans and, after all Swingline Loans have been repaid in full or if no Swingline
Loans are outstanding, principal of outstanding Dollar Revolving Loans in an
amount equal to such excess. If, after giving effect to the prepayment of all
such outstanding Swingline Loans and Dollar Revolving Loans, the sum of the
outstanding Competitive Bid Loans and Letter of Credit Outstandings exceeds the
Total Dollar Sub-Commitment as then in effect, (i) an amount of cash and/or Cash
Equivalents equal to such excess shall be deposited by Workflow with the Agent
as Collateral for the obligations of Workflow in respect of outstanding
Competitive Bid Loans and shall be applied to the repayment of such Competitive
Bid Loans at maturity and (ii) to the extent such excess exceeds the amount
applied pursuant to preceding clause (i), Workflow shall pay to the Agent cash
and/or Cash Equivalents in an amount equal to the amount of such excess (less
the amount applied pursuant to preceding clause (i)) (up to a maximum amount
equal to the Letter of Credit Outstandings at such time), such cash and/or Cash
Equivalents to be held as security for all obligations of Workflow hereunder and
under the
32
other Credit Documents in a cash collateral account (and invested from time to
time in Cash Equivalents selected by the Agent) to be established by the Agent.
(iv) If, after giving effect to any prepayment then being made
pursuant to the other provisions of this Section 4.02(A)(a) on any date, the
aggregate outstanding principal amount of all Acquisition Loans exceeds the
Acquisition Sub-Limit then in effect, the Borrowers shall prepay on such date
the principal of Acquisition Loans in an aggregate amount equal to such excess
(with the Borrowers utilizing the priorities and procedures set out in Section
4.02(a)(i) in respect of such prepayment).
(v) In the event that any Borrower is required pursuant to the other
provisions of this Section 4.02 to deliver any cash and/or Cash Equivalents to
the Agent to be held as security for the Obligations of such Borrower hereunder
and under the other Credit Documents, the Agent shall, at the request of such
Borrower and so long as no Default or Event of Default then exists, release to
such Borrower from time to time any investment earnings on such cash and/or Cash
Equivalents so long as the principal amount and/or Face Amount, as the case may
be, of the underlying Obligations remain fully collateralized at all times.
(b) With respect to each prepayment of Loans required by this Section 4.02,
the respective Borrower may designate the Types of Loans which are to be repaid
and, in the case of Eurodollar Loans and Bankers' Acceptances Loans, the
specific Borrowing(s) pursuant to which such Loans were made, provided that (i)
if any prepayment of Eurodollar Loans made pursuant to a single Borrowing shall
reduce the outstanding Eurodollar Loans made pursuant to such Borrowing to an
amount less than the Minimum Borrowing Amount applicable thereto, such Borrowing
shall be immediately converted into Base Rate Loans, (ii) no prepayment of
Bankers' Acceptance Loans may be made prior to the maturity date of the related
Bankers' Acceptances and (iii) each prepayment of any Loans made pursuant to a
Borrowing shall be applied pro rata among such Loans. In addition, all
prepayments of Loans pursuant to this Section 4.02 shall, unless otherwise
directed by the respective Borrower at the time of prepayment, first be deemed
to be applied to any outstanding Acquisition Loans and then to any outstanding
Working Capital Loans.
(c) Notwithstanding anything to the contrary contained in this Agreement,
(i) all then outstanding Swingline Loans shall be repaid in full on the
Swingline Expiry Date, (ii) all then outstanding Competitive Bid Loans shall be
repaid in full on the respective Competitive Bid Loan Maturity Date, (iii) all
then outstanding Revolving Loans shall be repaid in full on the Final Maturity
Date and (iv) all then outstanding Loans shall be repaid in full on the date on
which a Change of Control occurs.
4.03 Method and Place of Payment. Except as otherwise specifically provided
herein, all payments under this Agreement or under any Note shall be made to the
Agent for the ratable account of the Lenders entitled thereto, not later than
12:00 Noon (local time in the city in which the Payment Office for the
respective payments is located) on the date when due and shall be made in (x)
Dollars in immediately available funds at the appropriate Payment Office of the
Agent in respect of any obligation of the Borrowers under this Agreement except
as otherwise
33
provided in the immediately following clause (y) and (y) subject to the
provisions of Section 1.16, Canadian Dollars in immediately available funds at
the appropriate Payment Office of the Agent, if such payment is made in respect
of (i) principal of, the Face Amount of or interest on Canadian Revolving Loans,
or (ii) any increased costs, indemnities or other amounts owing with respect to
Canadian Revolving Loans, in the case of this clause (ii) to the extent the
respective Lender which is charging same denominates the amounts owing in
Canadian Dollars. Any payments under this Agreement which are made later than
12:00 Noon (local time in the city in which such payments are to be made) on any
Business Day shall be deemed to have been made on the next succeeding Business
Day. Whenever any payment to be made hereunder shall be stated to be due on a
day which is not a Business Day, the due date thereof shall be extended to the
next succeeding Business Day and, with respect to payments of principal,
interest shall be payable during such extension at the applicable rate in effect
immediately prior to such extension.
4.04 Net Payments. (a) All payments made by any Borrower hereunder or under
any Note will be made without setoff, counterclaim or other defense. Except as
provided in Section 4.04(b), all such payments will be made free and clear of,
and without deduction or withholding for, any present or future taxes, levies,
imposts, duties, fees, assessments or other charges of whatever nature now or
hereafter imposed by any jurisdiction or by any political subdivision or taxing
authority thereof or therein with respect to such payments (but excluding,
except as provided in the second succeeding sentence, any tax imposed on or
measured by the net income or net profits of a Lender pursuant to the laws of
the jurisdiction in which it is organized or the jurisdiction in which the
principal office or applicable lending office of such Lender is located or any
subdivision thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies, imposts, duties,
fees, assessments or other charges (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Taxes"). If any Taxes are so levied or imposed, the respective
Borrower agrees to pay the full amount of such Taxes, and such additional
amounts as may be necessary so that every payment of all amounts due under this
Agreement or under any Note, after withholding or deduction for or on account of
any Taxes, will not be less than the amount provided for herein or in such Note.
If any amounts are payable in respect of Taxes pursuant to the preceding
sentence, the respective Borrower agrees to reimburse each Lender, upon the
written request of such Lender, for taxes imposed on or measured by the net
income or net profits of such Lender pursuant to the laws of the jurisdiction in
which such Lender is organized or in which the principal office or applicable
lending office of such Lender is located or under the laws of any political
subdivision or taxing authority of any such jurisdiction in which such Lender is
organized or in which the principal office or applicable lending office of such
Lender is located and for any withholding of taxes as such Lender shall
determine are payable by, or withheld from, such Lender, in each case in respect
of such amounts so paid to or on behalf of such Lender pursuant to the preceding
sentence and in respect of any amounts paid to or on behalf of such Lender
pursuant to this sentence. The respective Borrower will furnish to the Agent
within 30 days after the date the payment of any Taxes is due pursuant to
applicable law certified copies of tax receipts evidencing such payment by such
Borrower. Each Borrower agrees to indemnify and hold harmless each Lender, and
reimburse such Lender upon its written request, for the amount of any Taxes so
levied or imposed and paid by such Lender.
34
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for United States federal
income tax purposes (other than a Canadian Lender in its capacity solely as a
lender to DBF) agrees to deliver to Workflow and the Agent on or prior to the
Effective Date, or in the case of a Lender that is an assignee or transferee of
an interest under this Agreement pursuant to Section 12.04 (unless the
respective Lender was already a Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to such
Lender, (i) two accurate and complete original signed copies of Internal Revenue
Service Form 4224 or 1001 (or successor forms) certifying to such Lender's
entitlement (as of such date) to a complete exemption from United States
withholding tax with respect to payments to be made under this Agreement and
under any Note, or (ii) if the Lender is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 (or successor forms) pursuant to clause (i) above, (x)
a certificate substantially in the form of Exhibit D (any such certificate, a
"Section 4.04(b)(ii) Certificate") and (y) two accurate and complete original
signed copies of Internal Revenue Service Form W-8 (or successor form)
certifying to such Lender's entitlement to a complete exemption from United
States withholding tax with respect to payments of interest to be made under
this Agreement and under any Note. In addition, each Lender (other than a
Canadian Lender in its capacity solely as a lender to DBF) agrees that from time
to time after the Effective Date, when a lapse in time or change in
circumstances renders the previous certification obsolete or inaccurate in any
material respect, it will deliver to Workflow and the Agent two new accurate and
complete original signed copies of Internal Revenue Service Form 4224 or 1001
(or successor forms), or Form W-8 (or successor form) and a Section 4.04(b)(ii)
Certificate, as the case may be, and such other forms as may be required in
order to confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with respect to
payments under this Agreement and any Note, or it shall immediately notify
Workflow and the Agent of its inability to deliver any such Form or Certificate
in which case such Lender shall not be required to deliver any such Form or
Certificate pursuant to this Section 4.04(b). Notwithstanding anything to the
contrary contained in Section 4.04(a), but subject to Section 12.04(b) and the
immediately succeeding sentence, (x) Workflow shall be entitled, to the extent
it is required to do so by law, to deduct or withhold income or similar taxes
imposed by the United States (or any political subdivision or taxing authority
thereof or therein) from interest, Fees or other amounts payable hereunder for
the account of any Lender which is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) for United States federal income tax
purposes to the extent that such Lender has not provided to Workflow United
States Internal Revenue Service Forms that establish a complete exemption from
such deduction or withholding and (y) Workflow shall not be obligated pursuant
to Section 4.04(a) hereof to gross-up payments to be made to a Lender in respect
of income or similar taxes imposed by the United States if (I) such Lender is
not a United States person (defined as provided above) and has not provided to
Workflow the Internal Revenue Service Forms provided for in the foregoing
provisions of this Section 4.04(b) or (II) in the case of a payment, other than
interest, to a Lender described in clause (ii) above, to the extent that such
Forms do not establish a complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the preceding sentence or
elsewhere in this Section 4.04 and except as set forth in Section 12.04(b),
Workflow agrees to pay any additional amounts and to indemnify each Lender in
the manner set forth in Section 4.04(a)
35
(without regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any Taxes deducted or withheld by it as described in
the immediately preceding sentence as a result of any changes after the
Effective Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of such Taxes.
(c) Notwithstanding anything to the contrary contained in this Section
4.04, unless a Lender gives notice to the applicable Borrower that such Borrower
is obligated to pay any amount under this Section 4.04 within one year after the
later of (i) the date such Lender incurs the respective Taxes or (ii) the date
such Lender has actual knowledge of its incurrence of the respective Taxes, then
such Lender shall only be entitled to be compensated for such amount by such
Borrower pursuant to this Section 4.04 to the extent such Taxes are incurred or
suffered on or after the date which occurs one year prior to the date that such
Lender gives notice to such Borrower that such Borrower is obligated to pay the
respective amounts pursuant to this Section 4.04. This Section 4.04(c) shall
have no applicability to any Section of this Agreement other than this Section
4.04.
SECTION 5. Conditions Precedent. The obligation of each Lender to make each
Loan and the obligation of the Letter of Credit Issuer to issue each Letter of
Credit hereunder are subject, at the time of each such Credit Event (except as
otherwise hereinafter indicated), to the satisfaction of the following
conditions:
5.01 Execution of Agreement. On or prior to the Effective Date, this
Agreement shall have been executed and delivered in accordance with Section
12.10.
5.02 Notes. On the Effective Date, there shall have been delivered to the
Agent for the account of each Lender that has requested the same the appropriate
Note or Notes executed by the appropriate Borrower in the amount, maturity and
as otherwise provided herein.
5.03 No Default; Representations and Warranties. At the time of each Credit
Event and also after giving effect thereto (i) there shall exist no Default or
Event of Default and (ii) all representations and warranties contained herein
and in the other Credit Documents shall be true and correct in all material
respects with the same effect as though such representations and warranties had
been made on and as of the date of such Credit Event, unless stated to relate to
a specific earlier date, in which case such representations and warranties shall
be true and correct in all material respects as of such earlier date.
5.04 Officer's Certificate. On the Effective Date, the Agent shall have
received a certificate dated such date signed by the president, any
vice-president or any Authorized Financial Officer of Workflow stating that all
of the applicable conditions set forth in Sections 5.03, 5.07, 5.08 and 5.09
exist as of such date.
5.05 Opinions of Counsel. On the Effective Date, the Agent shall have
received (i) from Kaufman & Canoles, special United States counsel to the Credit
Parties, an opinion addressed to the Agent, the Collateral Agent and each of the
Lenders and dated the Effective Date in the form of Exhibit E-1, (ii) from
Goodman, Phillips & Vineberg, special Canadian
36
counsel to the Credit Parties, a corporate opinion addressed to the Agent, the
Collateral Agent and each of the Lenders and dated the Effective Date in the
form of Exhibit E-2 and (iii) from local and other counsel to the Credit Parties
and/or the Agent reasonably satisfactory to the Agent, opinions each of which
shall be addressed to the Agent, the Collateral Agent and each of the Lenders
and dated the Effective Date and shall cover such matters incident to the
transactions contemplated herein and in the other Credit Documents (including,
without limitation, the perfection of the security interests granted pursuant to
the Security Documents) as the Agent may reasonably request and shall be in form
and substance reasonably satisfactory to the Agent.
5.06 Corporate Proceedings. (a) On the Effective Date, the Agent shall have
received from each Credit Party a certificate, dated the Effective Date, signed
by the president or any vice-president of such Credit Party, and attested to by
the secretary or any assistant secretary of such Credit Party, in the form of
Exhibit F with appropriate insertions, together with certified copies of the
certificate or articles of incorporation and by-laws, or equivalent
organizational documents, of such Credit Party, the resolutions of such Credit
Party referred to in such certificate and each of the other documents referred
to in such certificate and all of the foregoing shall be in form and substance
reasonably satisfactory to the Agent.
(b) On the Effective Date, all corporate, limited liability company and
legal proceedings and all instruments and agreements in connection with the
transactions contemplated by this Agreement and the other Documents shall be
reasonably satisfactory in form and substance to the Agent, and the Agent shall
have received all information and copies of all certificates, documents and
papers, including good standing certificates, bring-down certificates and any
other records of corporate proceedings and governmental approvals, if any, which
the Agent reasonably may have requested in connection therewith, such documents
and papers, where appropriate, to be certified by proper corporate or
governmental authorities.
(c) On the Effective Date, the corporate, ownership and capital structure
of Workflow and its Subsidiaries (including, without limitation, the terms of
any capital stock, options, warrants or other securities issued by Workflow or
any of its Subsidiaries) shall be in form and substance reasonably satisfactory
to the Agent and the Required Lenders.
5.07 Consummation of the Transaction. (a) On the Effective Date, the
Spinoff shall have been consummated in accordance with the terms and conditions
of the Spinoff Documents and all applicable laws, and each of the material
conditions precedent to the consummation of the Spinoff shall have been
satisfied and not waived except with the consent of the Agent and the Required
Lenders to the satisfaction of the Agent and the Required Lenders.
(b) On the Effective Date, Workflow shall have repaid in full all
intercompany debt owed to U.S. Office Products, which amount shall not exceed
$48,000,000.
(c) On or prior to the Effective Date, there shall have been delivered to
the Agent and the Lenders true and correct copies of all Spinoff Documents
(including, without limitation, the Spinoff Distribution Agreement, the Spinoff
Tax Allocation Agreement, the Spinoff Tax Indemnification Agreement and the
Spinoff Employee Benefits Agreement) and all of the terms
37
and conditions of such Spin Off Documents shall be in form and substance
reasonably satisfactory to the Agent and the Required Lenders.
(d) On the Effective Date, the Agent shall have received evidence, in form,
scope and substance reasonably satisfactory to it, that the matters set forth in
this Section 5.07 have been satisfied as of such date.
5.08 Adverse Change; Approvals. (a) On the Effective Date, nothing shall
have occurred (and neither the Required Lenders nor the Agent shall have become
aware of any facts or conditions not previously known) which the Required
Lenders or the Agent shall determine has had, or could reasonably be expected to
have, a Material Adverse Effect.
(b) On or prior to the Effective Date, all necessary governmental (domestic
and foreign) and third party approvals and/or consents in connection with the
Transaction and the other transactions contemplated by the Documents and
otherwise referred to herein or therein shall have been obtained and remain in
effect, and all applicable waiting periods with respect thereto shall have
expired without any action being taken by any competent authority which
restrains, prevents or imposes materially adverse conditions upon, the
consummation of the Transaction or the other transactions contemplated by the
Documents or otherwise referred to herein or therein. Additionally, there shall
not exist any judgment, order, injunction or other restraint issued or filed or
a hearing seeking injunctive relief or other restraint pending or notified
prohibiting or imposing materially adverse conditions upon the Transaction or
the other transactions contemplated by the Documents.
5.09 Litigation. On the Effective Date, there shall be no actions, suits or
proceedings pending or threatened (x) with respect to the Transaction, this
Agreement or any other Document or (y) which the Agent or the Required Lenders
shall determine has, or could reasonably be expected to have, a Material Adverse
Effect.
5.10 Guaranties. (a) On the Effective Date, each U.S. Subsidiary Guarantor
shall have duly authorized, executed and delivered a Guaranty in the form of
Exhibit G-1 (as modified, amended or supplemented from time to time in
accordance with the terms hereof and thereof, the "U. S. Subsidiaries
Guaranty"), and the U. S. Subsidiaries Guaranty shall be in full force and
effect.
(b) On the Effective Date, (i) Workflow and each Subsidiary Guarantor
(other than the Canadian Parents) shall have duly authorized, executed and
delivered a Guaranty in the form of Exhibit G-2 (as modified, amended or
supplemented from time to time in accordance with the terms hereof and thereof,
the "Canadian General Guaranty") and (ii) each Canadian Parent shall have only
authorized, executed and delivered a Guaranty in the form of Exhibit G-3 (as
modified, amended or supplemented from time to time in accordance with the terms
hereof and thereof, the "Canadian Parent Guaranty"), and each Canadian Guaranty
shall be in full force and effect.
5.11 Pledge Agreements; Security Agreements. (a) On the Effective Date,
each U.S. Credit Party shall have duly authorized, executed and delivered a
Pledge Agreement in the
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form of Exhibit H-1 (as modified, amended or supplemented from time to time in
accordance with the terms hereof and thereof, the "U.S. Pledge Agreement") and
shall have delivered to the Collateral Agent, as pledgee thereunder, all of the
Pledged Securities referred to therein and then owned by each such U.S. Credit
Party, endorsed in blank or accompanied by executed and undated stock powers, as
appropriate, and the U.S. Pledge Agreement shall be in full force and effect.
(b) On the Effective Date, DBF and each other Canadian Credit Party shall
have duly authorized, executed and delivered one or more Pledge Agreements in
the form of Exhibit H-2 (each as modified, amended or supplemented from time to
time in accordance with the terms hereof and thereof, a "Canadian Pledge
Agreement" and, collectively, the "Canadian Pledge Agreements") and shall have
delivered to the Collateral Agent, as pledgee thereunder, all of the Pledged
Securities referred to therein and then owned by DBF and each such other
Canadian Credit Party, endorsed in blank or accompanied by executed and undated
stock powers, as appropriate, and each Canadian Pledge Agreement shall be in
full force and effect.
(c) On the Effective Date, (i) each U.S. Credit Party shall have duly
authorized, executed and delivered a Security Agreement in the form of Exhibit
I-1 (as modified, supplemented or amended from time to time in accordance with
the terms hereof and thereof, the "U.S. Security Agreement") covering all of
such U.S. Credit Party's present and future Security Agreement Collateral and
(ii) DBF and each other Canadian Credit Party shall have duly authorized,
executed and delivered one or more Security Agreements in the form of Exhibit
I-2, one or more Hypothecs in the form of Exhibit I-3, a Debenture and Debenture
Pledge Agreement in the form of Exhibit I-4 and one or more additional security
arrangements with respect to their inventory and proceeds thereof as may be
requested by the Agent and in form and substance satisfactory to the Agent (each
as modified, supplemented or amended from time to time in accordance with the
terms hereof and thereof, a "Canadian Security Agreement" and, collectively, the
"Canadian Security Agreements") covering all of DBF's and each such other
Canadian Credit Party's present and future Security Agreement Collateral, in
each case together with:
(i) proper Financing Statements (Form UCC-1 or the equivalent) fully
executed for filing under the UCC or other appropriate filing offices of
each jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by each Security Agreement;
(ii) certified copies of Requests for Information (Form UCC-11) or
equivalent reports, listing all effective financing statements that name
any Credit Party or any of its Subsidiaries as debtor and that are filed in
the jurisdictions referred to in clause (i) above, together with copies of
such other financing statements that name any Credit Party or any of its
Subsidiaries as debtor (none of which shall cover the Collateral except to
the extent evidencing Permitted Liens or in respect of which the Collateral
Agent shall have received termination statements (Form UCC-3 or the
equivalent) or such other termination statements as shall be required by
state or local law fully executed for filing); and
39
(iii) evidence that all other actions necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect and protect the
security interests purported to be created by each Security Agreement have
been taken;
and each Security Agreement shall be in full force and effect.
5.12 Mortgages; Title Insurance; Surveys. On the Effective Date, the
Collateral Agent shall have received:
(i) fully executed counterparts of Mortgages, in form and substance
satisfactory to the Agent, which Mortgages shall cover the Mortgaged
Properties owned by the respective Credit Parties on the Effective Date as
designated on Annex V, together with evidence that counterparts of such
Mortgages have been delivered to the title insurance company insuring the
Lien of such Mortgages (or, in respect of Mortgaged Properties located in
Canada, to the applicable land registry office) for recording in all places
to the extent necessary or, in the reasonable opinion of the Collateral
Agent, desirable, to effectively create a valid and enforceable first
priority mortgage lien on each such Mortgaged Property in favor of the
Collateral Agent (or such other trustee as may be required or desired under
local law) for the benefit of the applicable Secured Creditors;
(ii) a mortgagee title insurance policy on each such Mortgaged
Property located in the United States issued by a title insurer reasonably
satisfactory to the Agent (the "Mortgage Policies") in amounts satisfactory
to the Agent assuring the Collateral Agent that the Mortgages on such
Mortgaged Properties are valid and enforceable first priority mortgage
liens on the respective Mortgaged Properties, free and clear of all defects
and encumbrances except Permitted Encumbrances and such Mortgage Policies
shall otherwise be in form and substance reasonably satisfactory to the
Agent and shall include, as appropriate, an endorsement for future advances
under this Agreement and the Notes and for any other matter that the Agent
in its discretion may reasonably request, shall not include an exception
for mechanics' liens, and shall provide for affirmative insurance and such
reinsurance as the Agent in its discretion may reasonably request; and
(iii) a survey, in form and substance reasonably satisfactory to the
Agent of each Mortgaged Property, certified by a licensed professional
surveyor reasonably satisfactory to the Agent.
5.13 Financial Statements; Pro Forma Balance Sheet; Projections. On or
prior to the Effective Date, the Agent shall have received true and correct
copies of the historical financial statements, the pro forma combined financial
statements and the projections referred to in Sections 6.09 and 6.10(b), which
historical financial statements, pro forma combined financial statements and
projections shall be in form and substance reasonably satisfactory to the Agent
and the Required Lenders.
5.14 Solvency Certificate; Environmental Analyses; Insurance Certificates.
On the Effective Date, Workflow shall have delivered to the Agent:
40
(i) a solvency certificate from the chief financial officer of
Workflow in the form of Exhibit J;
(ii) environmental and hazardous substance assessments and analyses in
scope, and in form and substance, reasonably satisfactory to the Agent and
the Required Lenders; and
(iii) certificates of insurance complying with the requirements of
Section 7.03 for the business and properties of Workflow and its
Subsidiaries, and naming the Collateral Agent as an additional insured and
as loss payee, and stating that such insurance shall not be canceled
without at least 30 days prior written notice by the respective insurer to
the Collateral Agent (or such shorter period of time as a particular
insurance company generally provides).
5.15 Plans; Shareholders' Agreements; Management Agreements; Collective
Bargaining Agreements; Tax Sharing Agreements; Existing Indebtedness Agreements.
On or prior to the Effective Date, there shall have been delivered to the Agent
true and correct copies of the following documents (if any):
(i) all Plans (and for each Plan that is required to file an annual
report on Internal Revenue Service Form 5500-series, a copy of the most
recent such report (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting
statements, certifications, schedules and information), and for each Plan
that is a "single-employer plan," as defined in Section 4001(a)(15) of
ERISA, the most recently prepared actuarial valuation therefor) and any
other "employee benefit plans," as defined in Section 3(3) of ERISA, and
any other material agreements. Plans or arrangements with or for the
benefit of current or former employees of Workflow or any of its
Subsidiaries or any ERISA Affiliate (provided that the foregoing shall
apply in the case of any multiemployer plan, as defined in 4001(a)(3) of
ERISA, only to the extent that any document described therein is in the
possession of Workflow or any Subsidiary of Workflow or any ERISA Affiliate
or reasonably available thereto from the sponsor or trustee of any such
plan);
(ii) all collective bargaining agreements applying or relating to any
employee of Workflow or any of its Subsidiaries (collectively, the
"Collective Bargaining Agreements");
(iii) all agreements entered into by Workflow or any of its
Subsidiaries governing the terms and relative rights of its capital stock
and any agreements entered into by shareholders relating to any such entity
with respect to its capital stock (collectively, the "Shareholders'
Agreements");
(iv) all material agreements with members of, or with respect to, the
management of Workflow or any of its Subsidiaries to which Workflow or any
of its Subsidiaries are parties (collectively, the "Management
Agreements");
41
(v) all tax sharing, tax allocation and other similar agreements
entered into by Workflow or any of its Subsidiaries (collectively, the "Tax
Sharing Agreements"); and
(vi) all agreements evidencing or relating to Indebtedness of Workflow
or any of its Subsidiaries which is to remain outstanding after giving
effect to the Effective Date (collectively, the "Existing Indebtedness
Agreements");
all of which Plans, Collective Bargaining Agreements, Shareholders' Agreements,
Management Agreements, Tax Sharing Agreements and Existing Indebtedness
Agreements shall be in form and substance reasonably satisfactory to the Agent.
5.16 Payment of Fees. On the Effective Date, all costs, fees and expenses,
and all other compensation contemplated by this Agreement, in each case due to
the Agent or the Lenders (including, without limitation, legal fees and
expenses) shall have been paid to the extent due.
5.17 Notice of Borrowing; Letter of Credit Request. The Agent shall have
received a Notice of Borrowing satisfying the requirements of Section 1.03(a)
with respect to each incurrence of Revolving Loans. The Agent shall have
received a Notice of Competitive Bid Borrowing satisfying the requirements of
Section 1.04 with respect to each incurrence of Competitive Bid Loans. BTCo
shall have received the notice satisfying the requirements of Section 1.03(b)(i)
with respect to each incurrence of Swingline Loans. The Agent and the Letter of
Credit Issuer shall have received a Letter of Credit Request satisfying the
requirements of Section 2.02 with respect to each issuance of a Letter of
Credit.
The occurrence of the Effective Date and the acceptance of the benefits of
each Credit Event on or after the Effective Date shall constitute a
representation and warranty by each Borrower to the Agent and each of the
Lenders that all of the conditions specified above exist as of the Effective
Date and as of the date of each such Credit Event, in each case to the extent
that such conditions are applicable to the Effective Date or each such other
Credit Event, as the case may be. All of the certificates, legal opinions and
other documents and papers referred to in Section 5, unless otherwise specified,
shall be delivered to the Agent at the Notice Office for the account of each of
the Lenders and, except for the Notes, in sufficient counterparts for each of
the Lenders and shall be reasonably satisfactory in form and substance to the
Agent.
SECTION 6. Representations, Warranties and Agreements. In order to induce
the Lenders to enter into this Agreement and to make the Loans and issue and/or
participate in the Letters of Credit provided for herein, each Borrower makes
the following representations, warranties and agreements, in each case after
giving effect to the Transaction, all of which shall survive the execution and
delivery of this Agreement, the making of the Loans and the issuance of the
Letters of Credit with the occurrence of the Effective Date and each Credit
Event on or after the Effective Date being deemed to constitute a representation
and warranty by each Borrower that the matters specified in this Section 6 are
true and correct in all material respects on and as of the Effective Date and
the date of each such Credit Event (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct only as of such specified date).
42
6.01 Status. Each Credit Party and each of its Subsidiaries (i) is a duly
organized and validly existing corporation, partnership or limited liability
company, as the case may be, and is in good standing, in each case under the
laws of the jurisdiction of its organization, and has the corporate, partnership
or limited liability company power and authority, as the case may be, to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage and (ii) is duly qualified and is authorized to do
business and is in good standing in all jurisdictions where it is required to be
so qualified and where the failure to be so qualified, either individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
6.02 Power and Authority. Each Credit Party has the corporate, partnership
or limited liability company power and authority, as the case may be, to
execute, deliver and carry out the terms and provisions of each of the Documents
to which it is a party and has taken all necessary corporate, partnership or
limited liability company action, as the case may be, to authorize the
execution, delivery and performance of each of the Documents to which it is a
party. Each Credit Party has duly executed and delivered each Document to which
it is a party and each such Document constitutes the legal, valid and binding
obligation of such Credit Party enforceable in accordance with its terms, except
to the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws generally
affecting creditors' rights and by equitable principles (regardless of whether
enforcement is sought in equity or at law).
6.03 No Violation. Neither the execution, delivery or performance by any
Credit Party of the Documents to which it is a party nor compliance by it with
the terms and provisions thereof, nor the consummation of the transactions
contemplated therein, (i) will contravene any applicable provision of any law,
statute, rule or regulation, or any order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict or be inconsistent
with or result in any breach of, any of the terms, covenants, conditions or
provisions of, or constitute a default under, or (other than pursuant to the
Security Documents) result in the creation or imposition of (or the obligation
to create or impose) any Lien upon any of the property or assets of such Credit
Party or any of its Subsidiaries pursuant to the terms of any material
indenture, mortgage, deed of trust, credit agreement or loan agreement, or any
other material agreement, contract or instrument to which such Credit Party or
any of its Subsidiaries is a party or by which it or any of its property or
assets are bound or to which it may be subject or (iii) will violate any
provision of the certificate or articles of incorporation or by-laws (or
equivalent organizational documents), as the case may be, of such Credit Party
or any of its Subsidiaries.
6.04 Litigation. There are no actions, suits or proceedings pending or, to
the best knowledge of any Borrower, threatened, with respect to Workflow or any
of its Subsidiaries that have, or that could reasonably be expected to have, a
Material Adverse Effect.
6.05 Use of Proceeds; Margin Regulations. (a) The proceeds of all Loans
shall be utilized for the general corporate and working capital purposes of
Workflow and its Subsidiaries (including for the repayment of any intercompany
debt owed to U.S. Office
43
Products as contemplated by Section 5.07(b)), provided that the proceeds of all
Acquisition Loans shall be utilized solely to make Permitted Acquisitions.
(b) No part of any Credit Event (or the proceeds thereof) will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock. Neither the making of any Loan
hereunder, nor the use of the proceeds thereof, nor the occurrence of any other
Credit Event, will violate or be inconsistent with the provisions of Regulation
T, U or X of the Board of Governors of the Federal Reserve System.
6.06 Approvals. No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with (except (x) as have
been obtained or made and which remain in full force and effect and (y) if this
representation is being made at any time prior to the tenth day following the
Effective Date, filings or recordations of financing statements, Mortgages and
other documents pursuant to the terms of the Security Documents (all of which
filings and recordations shall be completed within 10 days after the Effective
Date or, in the case of additional actions required by Section 7.12, such date
as is provided in said Section 7.12)), or exemption by, any governmental or
public body or authority, or any subdivision thereof or any other Person, is
required to authorize, or is required in connection with, (i) the execution,
delivery and performance of any Document or (ii) the legality, validity, binding
effect or enforceability of any such Document.
6.07 Investment Company Act. Neither Workflow nor any of its Subsidiaries
is an "investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.
6.08 Public Utility Holding Company Act. Neither Workflow nor any of its
Subsidiaries is a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
6.09 True and Complete Disclosure. All factual information (taken as a
whole) heretofore or contemporaneously furnished by or on behalf of any Credit
Party in writing to the Agent or any Lender (including, without limitation, all
information contained in the Documents and in the Confidential Information
Memorandum) for purposes of or in connection with this Agreement or any
transaction contemplated herein is, and all other such factual information
(taken as a whole) hereafter furnished by or on behalf of any officer of
Workflow or the president or chief financial officer of DBF in writing to the
Agent or any Lender will be, true and accurate in all material respects on the
date as of which such information is dated or certified and not incomplete by
omitting to state any material fact necessary to make such information (taken as
a whole) not misleading at such time in light of the circumstances under which
such information was provided. The projections and pro forma financial
information contained in such materials are reasonable and attainable and are
based on good faith estimates and assumptions believed by such Persons to be
reasonable at the time made, it being recognized by the Lenders that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may differ
from the projected results.
44
6.10 Financial Condition; Financial Statements. (a) On and as of the
Effective Date, on a pro forma basis after giving effect to the execution,
delivery and performance of this Agreement and the other Documents and the
consummation of the Transaction and to all Indebtedness incurred, and to be
incurred, and Liens created, and to be created, by each Credit Party in
connection therewith, and with respect to each Borrower on a stand-alone basis
and each Borrower and its Subsidiaries taken as a whole, (x) the sum of their
assets, at a fair valuation, will exceed their debts, (y) they have not incurred
nor intend to, nor believe that they will, incur debts beyond their ability to
pay such debts as such debts mature and (z) they will have sufficient capital
with which to conduct their business. For purposes of this Section 6.10, "debt"
means any liability on a claim, and "claim" means (i) 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 (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(b) The separate and combined balance sheets of Workflow and its
Subsidiaries for the fiscal year and nine month period ended on April 26, 1997
and January 24, 1998, respectively, and the related separate and combined
statements of income, cash flows and shareholders' equity of Workflow and its
Subsidiaries for the fiscal year or nine month period, as the case may be, ended
on such dates, copies of which have been furnished to the Lenders prior to the
Effective Date, present fairly in all material respects the separate and
combined financial position of Workflow and its Subsidiaries at the dates of
such balance sheets and the separate and combined results of the operations of
Workflow and its Subsidiaries for the periods covered thereby. All of the
foregoing historical financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied. The pro forma
consolidated financial statements of Workflow and its Subsidiaries as of April
26, 1997 and January 24, 1998, in each case after giving effect to the
Transaction and the financing therefor, copies of which have been furnished to
the Lenders prior to the Effective Date, present fairly in all material respects
the pro forma consolidated financial position of Workflow and its Subsidiaries
as of April 26, 1997 and January 24, 1998 and the pro forma consolidated results
of operations of Workflow and its Subsidiaries for the twelve month and nine
month periods covered thereby, as the case may be.
(c) After giving effect to the Transaction (but for this purpose assuming
that the Transaction and the related financing had occurred prior to April 26,
1997), since April 26, 1997, nothing shall have occurred that has had, or could
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.
(d) Except as fully reflected in the financial statements described in
Section 6.10(b) or in the footnotes thereto and the Indebtedness incurred under
this Agreement, there were as of the Effective Date (and after giving effect to
any Loans made on such date), no liabilities or obligations with respect to
Workflow or any of its Subsidiaries of any nature whatsoever (whether absolute,
accrued, contingent or otherwise and whether or not due) which, either
individually or in aggregate, could reasonably be expected to be material to
Workflow and
45
its Subsidiaries taken as a whole. As of the Effective Date, no Borrower knows
of any basis for the assertion against it or any of its Subsidiaries of any
liability or obligation of any nature whatsoever that is not disclosed in the
financial statements delivered pursuant to Section 6.10(b) which, either
individually or in the aggregate, could reasonably be expected to be material to
Workflow and its Subsidiaries taken as a whole.
6.11 Security Interests. Each of the Security Agreements and Mortgages are
effective to create, upon the filing of Form UCC-1 Financing Statements (or the
appropriate equivalent, Canadian or otherwise) and the Mortgages (which filings,
if this representation and warranty is being made more than 10 days after the
Effective Date, have been made) and each of the Pledge Agreements are effective
to create, in each case as security for the obligations purported to be secured
thereby, a valid and enforceable perfected security interest in and Lien on all
of the Collateral subject thereto, superior to and prior to the rights of all
third Persons and subject to no other Liens (except that the Security Agreement
Collateral may be subject to the security interests evidenced by Permitted Liens
relating thereto and each Mortgaged Property may be subject to the Permitted
Encumbrances relating thereto) in favor of the Collateral Agent (or such other
trustee as may be required or desired under local law), and the Collateral
Agent, for the benefit of the Secured Creditors, has a fully perfected lien on,
and security interest in, all Collateral. No filings or recordings are required
in order to perfect (or maintain the perfection or priority of) the security
interests created under the Pledge Agreements.
6.12 Tax Returns and Payments. Each of Workflow and each of its
Subsidiaries has filed all United States federal income tax returns and all
other material tax returns, domestic and foreign, required to be filed by it
(giving effect to any filing extension duly obtained in connection therewith)
and has paid all material taxes and assessments payable by it which have become
due, except for those contested in good faith and adequately disclosed and fully
provided for on the financial statements of Workflow and its Subsidiaries in
accordance with GAAP. Workflow and each of its Subsidiaries have at all times
paid, or have provided adequate reserves (in the good faith judgment of the
management of Workflow) for the payment of, all United States federal, state and
foreign income taxes applicable for all prior fiscal years and for the current
fiscal year to date. There is no material action, suit, proceeding,
investigation, audit or claim now pending or, to the knowledge of any Borrower,
threatened by any authority regarding any taxes relating to Workflow or any of
its Subsidiaries. As of the Effective Date, neither Workflow nor any of its
Subsidiaries has entered into an agreement or waiver or been requested to enter
into an agreement or waiver extending any statute of limitations relating to the
payment or collection of taxes of Workflow or any of its Subsidiaries, or is
aware of any circumstances that would cause the taxable years or other taxable
periods of Workflow or any of its Subsidiaries not to be subject to the normally
applicable statute of limitations. Neither Workflow nor any of its Subsidiaries
will incur any taxes in connection with the Transaction.
6.13 Compliance with ERISA. Each Plan (and each related trust, insurance
contract or fund) is in substantial compliance with its terms and with all
applicable laws, including, without limitation, ERISA and the Code; except for
the Plans set forth on Annex X, each Plan (and each related trust, if any) which
is intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect
46
that it meets the requirements of Sections 401(a) and 501(a) of the Code; no
Reportable Event has occurred; no Plan which is a multiemployer plan (as defined
in Section 4001(a)(3) of ERISA) is insolvent or in reorganization; no Plan has
an Unfunded Current Liability; no Plan which is subject to Section 412 of the
Code or Section 302 of ERISA has an accumulated funding deficiency, within the
meaning of such sections of the Code or ERISA, or has applied for or received a
waiver of an accumulated funding deficiency or an extension of any amortization
period, within the meaning of Section 412 of the Code or Section 303 or 304 of
ERISA; all contributions required to be made with respect to a Plan have been
timely made; neither Workflow nor any Subsidiary of Workflow nor any ERISA
Affiliate has incurred any material liability (including any indirect,
contingent or secondary liability) to or on account of a Plan pursuant to
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 401(a)(29), 4971 or 4975 of the Code or expects to incur any
such material liability under any of the foregoing sections with respect to any
Plan; no condition exists which presents a material risk to Workflow or any
Subsidiary of Workflow or any ERISA Affiliate of incurring a material liability
to or on account of a Plan pursuant to the foregoing provisions of ERISA and the
Code; no proceedings have been instituted to terminate or appoint a trustee to
administer any Plan which is subject to Title IV of ERISA; no material action,
suit, proceeding, hearing, audit or investigation with respect to the
administration, operation or the investment of assets of any Plan (other than
routine claims for benefits) is pending, expected or threatened; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of Workflow and its Subsidiaries
and its ERISA Affiliates to all Plans which are multiemployer plans (as defined
in Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom,
as of the close of the most recent fiscal year of each such Plan ended prior to
the date of the most recent Credit Event, would not exceed $1,000,000; each
group health plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2)
of the Code) which covers or has covered employees or former employees of
Workflow, any Subsidiary of Workflow or any ERISA Affiliate has at all times
been operated in material compliance with the provisions of Part 6 of subtitle B
of Title I of ERISA and Section 4980B of the Code; no lien imposed under the
Code or ERISA on the assets of Workflow or any Subsidiary of Workflow or any
ERISA Affiliate exists or is likely to arise on account of any Plan; and
Workflow and its Subsidiaries may cease contributions to or terminate any
employee benefit plan maintained by any of them without incurring any material
liability.
(b) Each Foreign Pension Plan has been maintained in material compliance
with its terms and with the requirements of any and all applicable laws,
statutes, rules, regulations and orders and has been maintained, where required,
in good standing with applicable regulatory authorities. All contributions
required to be made with respect to a Foreign Pension Plan have been timely
made. Neither Workflow nor any of its Subsidiaries has incurred any material
obligation in connection with the termination of or withdrawal from any Foreign
Pension Plan. The present value of the accrued benefit liabilities (whether or
not vested) under each Foreign Pension Plan, determined as of the end of
Workflow's most recently ended fiscal year on the basis of actuarial
assumptions, each of which is reasonable, did not exceed the current value of
the assets of such Foreign Pension Plan allocable to such benefit liabilities.
47
6.14 Ownership; Subsidiaries. On the Effective Date, the corporations
listed on Annex IV are all of the Subsidiaries of Workflow. Annex IV correctly
sets forth, as of the Effective Date, the percentage ownership (direct and
indirect) of Workflow in each class of capital stock of each of its respective
Subsidiaries and also identifies the direct owner thereof and the jurisdiction
of organization of such Subsidiaries.
6.15 Capitalization. On the Effective Date and after giving effect to the
Transaction and the other transactions contemplated hereby, the authorized
capital stock of Workflow shall consist of (i) 150,000,000 shares of common
stock, $.001 par value per share, and (ii) 1,000,000 shares of preferred stock,
$.001 par value per share, of which no shares of such preferred stock shall be
issued and outstanding. All outstanding shares of capital stock of Workflow have
been duly and validly issued and are fully paid and non-assessable. Workflow
does not have outstanding any securities convertible into or exchangeable for
its capital stock or outstanding any rights to subscribe for or to purchase, or
any options for the purchase of, or any agreement providing for the issuance
(contingent or otherwise) of, or any calls, commitments or claims of any
character relating to, its capital stock, except for options and warrants to
purchase shares of Workflow's common stock which may be issued from time to
time.
6.16 Intellectual Property. Each of Workflow and each of its Subsidiaries
owns or holds a valid license to use all the patents, trademarks, permits,
service marks, trade names, technology, know-how, copyrights, licenses,
franchises, proprietary information (including, but not limited to, rights in
computer programs and databases) and formulas or rights with respect to the
foregoing, that are used in the operation of the business of Workflow and each
of its Subsidiaries as presently conducted and as proposed to be conducted and
are necessary to such business, except where the failure to own or hold a valid
license with respect to any of the foregoing intellectual property could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
6.17 Compliance with Statutes, etc. Each of Workflow and each of its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including applicable statutes, regulations, orders and
restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in aggregate, reasonably be
expected to have a Material Adverse Effect.
6.18 Environmental Matters. (a) Each of Workflow and each of its
Subsidiaries has complied with all applicable Environmental Laws and the
requirements of any permits issued under such Environmental Laws. There are no
pending or, to the best knowledge of any Borrower, past or threatened
Environmental Claims against Workflow or any of its Subsidiaries or any Real
Property at any time owned, leased or operated by Workflow or any of its
Subsidiaries. There are no facts, circumstances, conditions or occurrences
concerning any business or operations of Workflow or any of its Subsidiaries or
any Real Property at any time owned, leased or operated by Workflow or any of
its Subsidiaries or, to the best knowledge of any Borrower, any property
adjoining or in the vicinity of any such Real Property that could
48
reasonably be expected (i) to form the basis of an Environmental Claim against
Workflow or any of its Subsidiaries or any currently owned Real Property of
Workflow or any of its Subsidiaries or (ii) to cause any such currently owned
Real Property to be subject to any material restrictions on the ownership,
occupancy, use or transferability of such Real Property by Workflow or any of
its Subsidiaries under any applicable Environmental Law.
(b) Hazardous Materials have not at any time been generated, used, treated
or stored on, or transported to or from, or Released on or from, any Real
Property at any time owned, leased or operated by Workflow or any of its
Subsidiaries where such generation, use, treatment, storage, transportation or
Release has violated or could reasonably be expected to violate any
Environmental Law. There are not now any underground storage tanks located on
any Real Property owned, leased or operated by Workflow or any of its
Subsidiaries.
(c) Notwithstanding anything to the contrary in this Section 6.18, the
representations made in this Section 6.18 shall only be untrue if the effect of
any or all failures, noncompliances, Environmental Claims, Hazardous Materials,
Releases and presence of underground storage tanks, in each case of the types
described above, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
6.19 Real Properties. All Real Property owned or leased by Workflow or any
of its Subsidiaries as of the Effective Date, and the nature of the interest
therein, is correctly set forth in Annex V. Workflow and each of its
Subsidiaries have good and marketable title to, or a validly subsisting
leasehold interest in, all material properties owned or leased by it, including
all Real Property reflected in Annex V and in the financial statements referred
to in Section 6.10(b), free and clear of all Liens, other than Permitted Liens.
6.20 Labor Relations. Neither Workflow nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect. There is (i) no unfair labor practice complaint pending
against Workflow or any of its Subsidiaries or, to the best knowledge of any
Borrower, threatened against any of them, before the National Labor Relations
Board, and no grievance or arbitration proceeding arising out of or under any
collective bargaining agreement is so pending against Workflow or any of its
Subsidiaries or, to the best knowledge of any Borrower, threatened against any
of them, (ii) no strike, labor dispute, slowdown or stoppage pending against
Workflow or any of its Subsidiaries or, to the best knowledge of any Borrower,
threatened against Workflow or any of its Subsidiaries and (iii) no union
representation question exists with respect to the employees of Workflow or any
of its Subsidiaries and, no union organizing activities are taking place, 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.
6.21 Indebtedness. Annex VI sets forth a true and complete list of all
Indebtedness of Workflow and its Subsidiaries as of the Effective Date and which
is to remain outstanding after giving effect to the Transaction (excluding the
Obligations, the "Existing Debt"), in each case showing the aggregate principal
amount thereof and the name of the respective borrower and any other entity
which directly or indirectly guaranteed such debt.
49
6.22 Other Documents. All representations and warranties set forth in the
Spin-off Documents and in the IPO Documents were true and correct in all
material respects on the effective date on which such representations and
warranties were made and shall be true and correct in all material respects on
and as of the Effective Date (or, in the case of the IPO Documents to the extent
entered into after the Effective Date, as of the date on which such IPO
Documents are entered into) as if such representations and warranties were made
on and as of such date.
6.23 Insurance. Annex VII sets forth a true and complete listing of all
insurance maintained by Workflow and its Subsidiaries as of the Effective Date,
and with the amounts insured (and any deductibles) set forth therein.
SECTION 7. Affirmative Covenants. Each Borrower hereby covenants and agrees
that as of the Effective Date and thereafter for so long as this Agreement is in
effect and until the Commitments have terminated, no Letters of Credit or Notes
are outstanding and the Loans and Unpaid Drawings, together with interest, Fees
and all other Obligations incurred hereunder, are paid in full:
7.01 Information Covenants. Workflow will furnish to each Lender:
(a) Annual Financial Statements. Within 90 days after the close of each
fiscal year of Workflow, (i) the consolidated balance sheets of each of Workflow
and its Subsidiaries (both with and without the Canadian Parents and their
Subsidiaries) and each Canadian Parent and its respective Subsidiaries, in each
case as at the end of such fiscal year and the related consolidated statements
of income and stockholders' equity and of cash flows for such fiscal year and
setting forth comparative figures for the preceding fiscal year and comparable
budgeted figures for such fiscal year and certified by the chief financial
officer or another Authorized Financial Officer of Workflow or DBF, as
appropriate, that such statements fairly present the consolidated financial
condition of Workflow and its Subsidiaries (both with and without the Canadian
Parents and their Subsidiaries) and each Canadian Parent and its respective
Subsidiaries, as the case may be, as of the dates indicated and the results of
their operations and changes in their cash flows for the periods indicated and
examined by independent certified public accountants of recognized national
standing as shall be acceptable to the Agent, whose opinion shall not be
qualified as to the scope of audit or as to the status of Workflow and its
Subsidiaries or each Canadian Parent and its respective Subsidiaries, each as a
going concern, together with a certificate of such accounting firm stating that
in the course of its regular audit of the business of each such Person and its
Subsidiaries, which audit was conducted in accordance with generally accepted
auditing standards, no Default or Event of Default which has occurred and is
continuing has come to their attention or, if such a Default or Event of Default
has come to their attention a statement as to the nature thereof and (ii)
management's discussion and analysis of the material operational and financial
developments during such fiscal year.
(b) Quarterly Financial Statements. Within 45 days after the close of each
of the first three quarterly accounting periods in each fiscal year of Workflow,
(i) the consolidated balance sheets of each of Workflow and its Subsidiaries
(both with and without the Canadian
50
Parents and their Subsidiaries) and each Canadian Parent and its respective
Subsidiaries, in each case as at the end of such quarterly accounting period and
the related consolidated statements of income and stockholders' equity and of
cash flows for such quarterly accounting period, and for the elapsed portion of
the fiscal year ended with the last day of such quarterly accounting period, in
each case setting forth comparative figures for the related periods in the prior
fiscal year and comparable budgeted figures for such quarterly accounting
period, all of which shall be in reasonable detail and certified by the chief
financial officer or another Authorized Financial Officer of Workflow or DBF, as
appropriate, that they fairly present the consolidated financial condition of
Workflow and its Subsidiaries (both with and without the Canadian Parents and
their Subsidiaries) and each Canadian Parent and its respective Subsidiaries as
of the dates indicated and the results of their operations and changes in their
cash flows for the periods indicated, subject to normal year-end audit
adjustments, and (ii) management's discussion and analysis of the material
operational and financial developments during such quarterly accounting period.
(c) Monthly Reports. Within 30 days after the end of each fiscal month of
Workflow (commencing with its fiscal month ending closest to July 31, 1998), the
consolidated balance sheet of Workflow and its Subsidiaries at the end of such
fiscal month and the related consolidated statements of income, stockholders'
equity and statement of cash flows for such fiscal month and for the elapsed
portion of the fiscal year ended with the last day of such fiscal month, in each
case setting forth comparative figures for the corresponding fiscal month in the
prior fiscal year and comparable budgeted figures for such fiscal month.
(d) Budgets, etc. Not more than 45 days after the commencement of each
fiscal year of Workflow, budgets in form reasonably satisfactory to the Agent
(including, in any event, budgeted statements of income and sources and uses of
cash and balance sheets) for (x) such fiscal year and for each of the monthly
and quarterly accounting periods in such fiscal year, in each case prepared in
detail and (y) each of the five years immediately following such fiscal year
prepared in summary form, of Workflow and its Subsidiaries, in each case as
customarily prepared by management for its internal use setting forth, with
appropriate discussion, the principal assumptions upon which such budgets are
based.
(e) Officer's Certificates. At the time of the delivery of the financial
statements provided for in Sections 7.01(a) and (b), a certificate of the chief
financial officer or another Authorized Financial Officer of Workflow to the
effect that no Default or Event of Default exists or, if any Default or Event of
Default does exist, specifying the nature and extent thereof, which certificate
shall set forth (in reasonable detail) the calculations required to establish
whether Workflow and its Subsidiaries were in compliance with the provisions of
Sections 7.12(a), 7.12(b), 8.04, 8.05, 8.09 and 8.10, as at the end of such
fiscal quarter or year, as the case may be.
(f) Notice of Default or Litigation. Promptly, and in any event within five
Business Days after any officer of Workflow or any of its Subsidiaries obtains
knowledge thereof, notice of (x) the occurrence of any event which constitutes a
Default or an Event of Default, which notice shall specify the nature thereof,
the period of existence thereof and what action the Borrowers propose to take
with respect thereto and (y) the commencement of, or threat
51
of, or any significant development in, any litigation or governmental proceeding
pending against Workflow or any of its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect.
(g) Auditors' Reports. Promptly upon receipt thereof, a copy of each report
or "management letter" submitted to Workflow or any of its Subsidiaries by its
independent accountants in connection with any annual, interim or special audit
made by them of the books of Workflow or any of its Subsidiaries.
(h) Environmental Matters. Promptly after any officer of Workflow or any of
its Subsidiaries obtains knowledge of any of the following environmental
matters, unless such environmental matters could not, individually or when
aggregated with all other such environmental matters, be reasonably expected to
have a Material Adverse Effect:
(i) any pending or threatened Environmental Claim against Workflow or
any of its Subsidiaries or any Real Property owned, operated or leased by
Workflow or any of its Subsidiaries;
(ii) any condition or occurrence that (x) results in noncompliance by
Workflow or any of its Subsidiaries with any applicable Environmental Law,
or (y) could reasonably be anticipated to form the basis of an
Environmental Claim against Workflow or any of its Subsidiaries or any Real
Property owned, operated or leased by Workflow or any of its Subsidiaries;
(iii) any condition or occurrence on any Real Property owned, operated
or leased by Workflow or any of its Subsidiaries that could reasonably be
anticipated to cause such Real Property to be subject to any restrictions
on the ownership, occupancy, use or transferability by Workflow or its
Subsidiary, as the case may be, of its interest in such Real Property under
any Environmental Law; and
(iv) the taking of any material removal or remedial action in response
to the actual or alleged presence of any Hazardous Material on any Real
Property owned, operated or leased by Workflow or any of its Subsidiaries.
All such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and
Workflow's or such Subsidiary's response thereto. In addition, each Borrower
agrees to provide the Lenders with copies of all material communications with
any government or governmental agency relating to Environmental Laws, all
material communications with any person relating to Environmental Claims, and
such detailed reports of any Environmental Claim as may reasonably be requested
by the Agent or the Required Lenders.
(i) Permitted Acquisition Reports. (A) Within 30 days after the date of the
consummation of a Permitted Acquisition in which the Acquired Business had
annual revenues of $10,000,000 or more for the most recently ended fiscal year
of such Acquired Business, an
52
audit of such Acquired Business prepared by Workflow's independent certified
public accountants.
(B) Within 30 days after the date of the consummation of a Permitted
Acquisition in which the Acquired Business had annual revenues of less than
$10,000,000 for the most recently ended fiscal year of such Acquired Business,
an unaudited report of such Acquired Business prepared by Workflow's independent
certified public accountants.
(j) Acquisition Loans and Working Capital Loans. Within 15 days after the
end of each month, a certificate of an Authorized Financial Officer of Workflow
setting forth the aggregate outstanding principal amount of Working Capital
Loans and Acquisition Loans as of the last day of such month.
(k) Other Information. Promptly upon transmission thereof, copies of any
filings and registrations with, and reports to, the SEC by Workflow or any of
its Subsidiaries and copies of all financial statements, proxy statements,
notices and reports as Workflow or any of its Subsidiaries shall send to the
holders of their publicly held capital stock (in each case to the extent not
theretofore delivered to the Lenders pursuant to this Agreement) and, with
reasonable promptness, such other information or documents (financial or
otherwise) as the Agent or any Lenders may reasonably request from time to time.
7.02 Books, Records and Inspections; Annual Meetings. (a) Each Borrower
will, and will cause each of its Subsidiaries to, permit, upon reasonable prior
notice to any officer of such Borrower, officers and designated representatives
of the Agent or any Lender to visit and inspect any of the properties or assets
of such Borrower or any of its Subsidiaries in whomsoever's possession, and to
examine the books of account of such Borrower or any of its Subsidiaries and
discuss the affairs, finances and accounts of such Borrower of any of its
Subsidiaries with, and be advised as to the same by, their officers and
independent accountants, all at such reasonable times and intervals and to such
reasonable extent as the Agent or such Lender may desire.
(b) At a date to be mutually agreed upon between the Agent and Workflow
occurring on or prior to the 120th day after the close of each fiscal year of
Workflow, Workflow shall, at the request of the Agent, hold a meeting with all
of the Lenders at which meeting shall be reviewed the financial results of
Workflow and its Subsidiaries for the previous fiscal year and the budgets
presented for the current fiscal year of Workflow (it being understood that
Workflow shall not be responsible for paying the travel and lodging expenses of
the Lenders in connection with their attending any such meeting).
7.03 Maintenance of Property; Insurance. (a) Each Borrower will, and will
cause each of its Subsidiaries to, at all times maintain in full force and
effect insurance with reputable and solvent insurers in such amounts, covering
such risks and liabilities and with such deductibles or self-insured retentions
as are in accordance with normal industry practice. Workflow will furnish on the
Effective Date and annually thereafter to the Agent a summary of the insurance
carried in respect of Workflow and its Subsidiaries and the assets of Workflow
and its Subsidiaries together with certificates of insurance and other evidence
of such insurance, if
53
any, naming the Collateral Agent as an additional insured (in the case of
liability policies) and/or loss payee (in the case of casualty policies), to the
extent of its interests therein.
(b) If any Borrower or any of its Subsidiaries shall fail to maintain all
insurance in accordance with this Section 7.03, or if any Borrower or any of its
Subsidiaries shall fail to so endorse and deposit all policies or certificates
with respect thereto, the Agent and/or the Collateral Agent shall have the right
(but shall be under no obligation) to procure such insurance and each Borrower
agrees to reimburse the Agent or the Collateral Agent as the case may be, for
all costs and expenses of procuring such insurance.
7.04 Payment of Taxes. Each Borrower will pay and discharge, and will cause
each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, and all lawful claims for sums that have become due and payable which,
if unpaid, might become a Lien not otherwise permitted under Section 8.03(a) or
charge upon any properties of such Borrower or any of its Subsidiaries provided
that neither Borrower nor any of its Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim which is being contested in good
faith and by proper proceedings if it has maintained adequate reserves with
respect thereto in accordance with GAAP.
7.05 Corporate Franchises. Each Borrower will do, and will cause each of
its Subsidiaries to do, or cause to be done, all things necessary to preserve
and keep in full force and effect its existence, and its rights, franchises and
authority to do business to the extent material to such Borrower or such
Subsidiary, provided that any transaction permitted by Section 8.02 will not
constitute a breach of this Section 7.05.
7.06 Compliance with Statutes, etc. Each Borrower will, and will cause each
of its Subsidiaries to, comply with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property other than those the non-compliance with which, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
7.07 Good Repair. Each Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment used or
useful in its business are kept in good repair, working order and condition,
normal wear and tear excepted, and, subject to Section 8.05, that from time to
time there are made in such properties and equipment all needful and proper
repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto, to the extent and in the manner useful or customary for
companies in similar businesses.
7.08 Compliance with Environmental Laws. (a) Except where the failure to do
so could not, either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, each Borrower: (i) will comply, and will cause
each of its Subsidiaries to comply, with all Environmental Laws applicable to
the operation of their business and the ownership or use of any Real Property;
(ii) will pay, and will cause each of its Subsidiaries to pay, all costs and
expenses incurred in such compliance; (iii) will keep or cause to be kept all
54
Real Properties owned, operated or leased by such Borrower or any of its
Subsidiaries free and clear of any Liens imposed pursuant to such Environmental
Laws; and (iv) will not, and will not permit any of its subsidiaries to,
generate, use, treat, store, release or dispose of, or permit the generation,
use, treatment, storage, release or disposal of, Hazardous Materials on any such
Real Property, or transport or permit the transportation of Hazardous Materials
to or from any such Real Property except in compliance with applicable law. If
any Borrower or any of its Subsidiaries, or any tenant or occupant of any such
Real Property, causes or permits any intentional or unintentional act or
omission resulting in the material presence or release of any Hazardous Material
(except in compliance with applicable Environmental Laws), such Borrower agrees
to undertake, and/or to cause any of its Subsidiaries, tenants or occupants to
undertake, at their sole expense, any clean up, removal, remedial or other
action required pursuant to Environmental Laws to remove and clean up any
Hazardous Materials from any such Real Property, provided that neither Borrower
nor any of its Subsidiaries shall be required to comply with any such order or
directive which is being contested in good faith and by proper proceedings so
long as it has maintained adequate reserves with respect to such compliance to
the extent required in accordance with GAAP.
(b) At the written reasonable request of the Agent or the Required Lenders,
at any time when any Borrower is required to give the Agent notice under Section
7.01(h) of any event specified in such Section 7.01(h), such Borrower will
provide, at such Borrower's sole cost and expense, an environmental site
assessment report concerning any Real Property the subject of such notice,
prepared by an environmental consulting firm approved by the Agent, indicating
the presence or absence of Hazardous Materials and the potential cost of any
removal or remedial action in connection with any Hazardous Materials on such
Real Property. If any Borrower fails to provide the same 90 days after such
request was made, the Agent may order the same, and such Borrower shall grant
and hereby grants to the Agent and its agents access to such Real Property and
specifically grants the Agent an irrevocable non-exclusive license, subject to
the rights of tenants, to undertake such an assessment, all at the Borrowers'
expense.
7.09 ERISA. As soon as possible and, in any event, within ten (10) days
after Workflow, any Subsidiary of Workflow or any ERISA Affiliate knows or has
reason to know of the occurrence of any of the following, Workflow will deliver
to each of the Lenders a certificate of an Authorized Financial Officer of
Workflow setting forth the full details as to such occurrence and the action, if
any, that Workflow, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given to
or filed with or by Workflow, any Subsidiary, any ERISA Affiliate, the PBGC, any
other governmental agency, a Plan participant or the Plan administrator with
respect thereto: that a Reportable Event has occurred (except to the extent that
Workflow has previously delivered to the Lenders a certificate and notices (if
any) concerning such event pursuant to the next clause hereof); that a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA is subject to the advance reporting requirement of
PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1) thereof),
and an event described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC
Regulation Section 4043 is reasonably expected to occur with respect to such
Plan within the following 30 days; that an accumulated funding deficiency,
within the meaning of Section 412 of the Code or Section 302
55
of ERISA, has been incurred or an application is reasonably likely to be or has
been made for a waiver or modification of the minimum funding standard
(including any required installment payments) or an extension of any
amortization period under Section 412 of the Code or Section 303 or 304 of ERISA
with respect to a Plan; that any contribution required to be made with respect
to a Plan or Foreign Pension Plan has not been timely made; that a Plan has been
or may be terminated, reorganized, partitioned or declared insolvent under Title
IV of ERISA; that a Plan has an Unfunded Current Liability; that proceedings are
reasonably likely to be or have been instituted to terminate or appoint a
trustee to administer a Plan which is subject to Title IV of ERISA; that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a
delinquent contribution to a Plan; that Workflow, any Subsidiary of Workflow or
any ERISA Affiliate will or may incur any material liability (including any
indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29),
4971, 4975 or 4980 of the Code or Section 409, 502(i) or 502(l) of ERISA or with
respect to a group health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) under Section 4980B of the Code; or that Workflow or
any Subsidiary of Workflow may incur any material liability pursuant to any
employee welfare benefit plan (as defined in Section 3(1) of ERISA) that
provides benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any Plan or any Foreign Pension Plan.
Workflow will deliver to each of the Lenders (i) a complete copy of the annual
report (on Internal Revenue Service Form 5500-series) of each Plan (including,
to the extent required, the related financial and actuarial statements and
opinions and other supporting statements, certifications, schedules and
information) required to be filed with the Internal Revenue Service and (ii)
copies of any records, documents or other information that must be furnished to
the PBGC with respect to any Plan pursuant to Section 4010 of ERISA. In addition
to any certificates or notices delivered to the Lenders pursuant to the first
sentence hereof, copies of annual reports and any records, documents or other
information required to be furnished to the PBGC, and any material notices
received by Workflow, any Subsidiary of Workflow or any ERISA Affiliate with
respect to any Plan or Foreign Pension Plan shall be delivered to the Lenders no
later than ten (10) days after the date such annual report has been filed with
the Internal Revenue Service or such records, documents and/or information has
been furnished to the PBGC or such notice has been received by Workflow, any
Subsidiary or any ERISA Affiliate, as applicable. Workflow and each of its
applicable Subsidiaries shall ensure that all Foreign Pension Plans administered
by it or into which it makes payments obtains or retains (as applicable)
registered status under and respects in compliance with all applicable laws
except where the failure to do any of the foregoing could not reasonably be
expected to result in a Material Adverse Effect.
7.10 Performance of Obligations. Each Borrower will, and will cause each of
its Subsidiaries to, perform all of its obligations under the terms of each
mortgage, indenture, security agreement, loan agreement or credit agreement and
each other agreement, contract or instrument by which it is bound, except such
non-performances as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
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7.11 End of Fiscal Years; Fiscal Quarters. Each Borrower will, for
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on the last Saturday in April of each year
and (ii) each of its, and each of its Subsidiaries', fiscal quarters to end on
dates which are consistent with a fiscal year end as provided above in this
Section 7.11.
7.12 Additional Security; Further Assurances. (a) At the time any Person
which does not constitute a Material Subsidiary on the date on which such Person
is acquired pursuant to a Permitted Acquisition becomes a Material Subsidiary
thereafter (whether by acquisition, merger or otherwise), Workflow shall give
prompt notice thereof to the Agent. As soon as possible after such notice has
been given, but in no event later than 60 days after such notice, Workflow shall
cause such Subsidiary to (x) execute a counterpart of the applicable Pledge
Agreement and Security Agreement (or another pledge agreement or security
agreement, as the case may be, in substantially similar form if needed), and (y)
execute and deliver, or cause to be executed and delivered, all other relevant
documentation of the type described in Section 5 as such Subsidiary would have
had to deliver if such Subsidiary were granting a security interest in its
assets on the Effective Date, in each case, in form and substance satisfactory
to the Agent.
(b) As soon as possible, but in any event within 60 days following the
Effective Date, Workflow and its Subsidiaries, to the extent reasonably
requested by the Agent, shall take all actions necessary and as are required by
law to establish, perfect, preserve and protect the Collateral Agent's security
interest in any Collateral located in Puerto Rico.
(c) As soon as possible, but in any event within 30 days following the
Effective Date, Workflow shall have caused DBF and the Canadian Parents (and DBF
hereby agrees) to deliver to the Collateral Agent, with respect to Mortgaged
Properties located in Canada, title opinions issued by Canadian counsel
reasonably satisfactory to the Agent assuring the Collateral Agent that DBF has
good and marketable title to the Mortgaged Property and that the Mortgages on
such Mortgaged Properties are valid and enforceable first priority mortgage
liens on the respective Mortgaged Properties, free and clear of all defects and
encumbrances except Permitted Encumbrances and such title opinions shall
otherwise be in form and substance reasonably satisfactory to the Agent.
(d) At the time any Credit Party shall acquire after the Effective Date an
ownership or Leasehold interest in any Material Real Property (or at the time of
the acquisition or creation, after the Effective Date, of any Credit Party
having an ownership or Leasehold interest in any Material Real Property),
Workflow shall give prompt notice thereof to the Agent. Upon the request of the
Agent or the Required Lenders, such Borrower shall, or shall cause such
Subsidiary Guarantor to, execute a Mortgage with respect to such Material Real
Property reasonably satisfactory in form and substance to the Agent and such
Mortgage shall constitute a valid and enforceable perfected mortgage superior to
and prior to the rights of all third Persons and subject to no other Liens
except for Permitted Liens. The Mortgages or instruments related thereto
delivered pursuant to this Section 7.12 shall have been duly recorded or filed
in such manner and in such places as are required by law to establish, perfect,
preserve and protect the
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Liens in favor of the Collateral Agent required to be granted pursuant to such
Mortgages and all taxes, fees and other charges payable in connection therewith
shall have been paid in full.
(e) Each Borrower will, and will cause each other Credit Party to, at the
expense of the Credit Parties, make, execute, endorse, acknowledge, file and/or
deliver to the Collateral Agent from time to time such vouchers, invoices,
schedules, confirmatory assignments, conveyances, financing statements, transfer
endorsements, powers of attorney, certificates, real property surveys, reports
and other assurances or instruments and take such further steps relating to the
collateral covered by any of the Security Documents as the Collateral Agent may
reasonably require. Furthermore, each Borrower shall cause to be delivered to
the Collateral Agent such opinions of counsel, real estate appraisals satisfying
the requirements of applicable law, mortgage policies, title insurance and other
related documents as may be reasonably requested by the Collateral Agent to
assure itself that this Section 7.12 has been complied with.
(f) Each Borrower agrees that each action required above by Sections
7.12(d) and (e) shall be completed as soon as possible, but in no event later
than 75 days after such action is requested to be taken by the Agent or the
Required Lenders.
7.13 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 Workflow
reasonably acceptable to the Agent does not within 30 days after a request from
the Agent or the Required Lenders deliver evidence, in form and substance
mutually satisfactory to the Agent and Workflow, with respect to any Foreign
Subsidiary which has not already had all of its stock pledged pursuant to the
U.S. Pledge Agreement that (i) 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, (ii) the entering into by such Foreign Subsidiary of a security
agreement in substantially the form of the U.S. Security Agreement and (iii) the
entering into by such Foreign Subsidiary of a guaranty in substantially the form
of the U.S. Subsidiaries Guaranty, in any such case could reasonably be expected
to cause (I) the undistributed earnings of such Foreign Subsidiary as determined
for United States federal income tax purposes to be treated as a deemed dividend
to such Foreign Subsidiary's United States parent for United States federal
income tax purposes which would not be substantially offset by a foreign tax
credit or other similar benefit of such United States parent or (II) other
material adverse United States federal income tax consequences to the Credit
Parties, then in the case of a failure to deliver the evidence described in
clause (i) above, that portion of such Foreign Subsidiary's outstanding capital
stock so issued by such Foreign Subsidiary not theretofore pledged pursuant to
the U.S. Pledge Agreement shall be pledged to the Collateral Agent for the
benefit of the Secured Creditors pursuant to the U.S. Pledge Agreement (or
another pledge agreement in substantially similar form, if needed), and in the
case of a failure to deliver the evidence described in clause (ii) above, such
Foreign Subsidiary shall execute and deliver the U.S. Security Agreement (or
another security agreement in substantially similar form, if needed), granting
the Collateral Agent for the benefit of the Secured Creditors a security
interest in all of such Foreign Subsidiary's assets, and in the case of a
failure to deliver the evidence described in clause (iii) above, such Foreign
Subsidiary shall execute and deliver the U.S. Subsidiaries Guaranty (or another
guaranty in substantially similar form, if needed), guaranteeing the
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Obligations of Workflow under the Credit Documents and under any Interest Rate
Protection Agreement or Other Hedging Agreement, and with all documents
delivered pursuant to this Section 7.13 to be in form and substance reasonably
satisfactory to the Agent.
7.14 Landlord Waivers and Estoppel Certificates. Within 75 days following
the Effective Date, the Borrowers shall use their reasonable best efforts to
deliver to the Agent the following:
(i) such landlord waivers and/or estoppel certificates as the Agent
may have reasonably requested with respect to each Leasehold of Workflow
and each other Credit Party designated as such on Annex V, which landlord
waivers and/or estoppel certificates shall be in form and substance
reasonably satisfactory to the Agent;
(ii) fully executed counterparts of a Mortgage, in form and substance
satisfactory to the Agent, which Mortgage shall cover the Real Property
owned by the respective Credit Party in Mt. Pocono in the Commonwealth of
Pennsylvania, together with evidence that counterparts of such Mortgage
have been delivered to the title insurance company insuring the Lien of
such Mortgage for recording in all places to the extent necessary or, in
the reasonable opinion of the Collateral Agent desirable, to effectively
create a valid and enforceable second priority mortgage lien on such Real
Property in favor of the Collateral Agent (or such other trustee as may be
required or desired under local law) for the benefit of the applicable
Secured Creditors;
(iii) a mortgagee title insurance policy on the Real Property referred
to in clause (ii) above issued by a title insurer reasonably satisfactory
to the Agent in an amount satisfactory to the Agent assuring the Collateral
Agent that the Mortgage on such Real Property is a valid and enforceable
second priority mortgage lien on such Real Property, free and clear of all
defects and encumbrances except Permitted Encumbrances and such policy
shall otherwise be in form and substance reasonably satisfactory to the
Agent and shall include, as appropriate, an endorsement for future advances
under this Agreement and the Notes and for any other matter that the Agent
in its discretion may reasonably request, shall not include an exception
for mechanics' liens, and shall provide for affirmative insurance and such
reinsurance as the Agent in its discretion may reasonably request; and
(iv) a survey, in form and substance reasonably satisfactory to the
Agent of the Real Property referred to in clause (ii) above, certified by a
licensed professional surveyor reasonably satisfactory to the Agent.
SECTION 8. Negative Covenants. Each Borrower hereby covenants and agrees
that as of the Effective Date, and thereafter for so long as this Agreement is
in effect and until the Commitments have terminated, no Letters of Credit or
Notes are outstanding and the Loans, together with interest, Fees and all other
Obligations incurred hereunder, are paid in full:
8.01 Changes in Business. No Borrower will, nor will any Borrower permit
any of its Subsidiaries to, engage directly or indirectly in any business other
than the businesses
59
engaged in by Workflow and its Subsidiaries as of the Effective Date (including
the graphic arts business and the office products business) and reasonable
extensions thereof and business complimentary thereto.
8.02 Consolidation, Merger, Sale or Purchase of Assets, etc. No Borrower
will, nor will any Borrower permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of (or agree to do
any of the foregoing at any future time) all or any part of its property or
assets (other than sales of inventory and obsolete or worn-out equipment, in
each case in the ordinary course of business), or enter into any partnerships,
joint ventures or sale-leaseback transactions, or purchase or otherwise acquire
(in one or a series of related transactions) any part of the property or assets
(other than purchases or other acquisitions of inventory, materials and
equipment in the ordinary course of business) of any Person, except that the
following shall be permitted:
(a) Consolidated Capital Expenditures by Workflow and its Subsidiaries
to the extent not in violation of Section 8.05, and Workflow and its
Subsidiaries may enter into operating leases as lessee with respect to real
or personal property in the ordinary course of business and otherwise in
compliance with this Agreement;
(b)(i) Workflow and the U.S. Subsidiary Guarantors (other than
Specified Subsidiaries and any U.S. Subsidiary Guarantors that are not
required to execute and deliver, and have not executed and delivered, the
respective Security Documents) may transfer assets among themselves and
(ii) DBF and the other Canadian Credit Parties (other than Specified
Subsidiaries and any Canadian Credit Parties that are not required to
execute and deliver, and have not executed and delivered, the respective
Security Documents) may transfer assets among themselves and to Workflow
and the U.S. Subsidiary Guarantors (other than Specified Subsidiaries and
any U.S. Subsidiary Guarantors that are not required to execute and
deliver, and have not executed and delivered, the respective Security
Documents);
(c) Investments permitted pursuant to Section 8.06;
(d) Workflow and its Subsidiaries may sell or discount, in each case
without recourse, accounts receivables arising in the ordinary course of
business, but only in connection with the compromise or collection thereof
and not as part of any financing transaction;
(e) Workflow and its Subsidiaries may sell or otherwise dispose of
assets for cash and at fair market value (as determined in good faith by
Workflow or such Subsidiary), provided that the aggregate cash proceeds
from all such sales pursuant to this clause (e) shall not exceed, in the
aggregate, $10,000,000 in any two consecutive fiscal year period of
Workflow;
(f) the Credit Parties may acquire all or substantially all of the
assets of any Acquired Business (or all or substantially all of the assets
of a product line or division of
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any Acquired Business) or 100% of the capital stock of any Acquired
Business (including by merger of the Acquired Business with a Credit Party
so long as the survivor of such merger is, or becomes at such time, a
Credit Party although in the case of any such merger which involves any
Borrower, such Borrower shall be the surviving corporation) (any such
acquisition, a "Permitted Acquisition" and the date of consummation of any
such Permitted Acquisition, an "Acquisition Date"), provided that (i) the
sum of the aggregate cash consideration plus the aggregate fair market
value of all other consideration paid by the Credit Parties (including any
Indebtedness issued, incurred and/or assumed by the Credit Parties and any
capital stock issued by Workflow, but excluding any amounts paid through an
earn-out formula based on earnings) in connection with any Permitted
Acquisition shall not exceed $35,000,000 (except that the total
consideration for each of two Permitted Acquisitions during the term of
this Agreement may be up to $50,000,000), provided that the Credit parties
may consummate Permitted Acquisitions in which the aggregate consideration
is greater than $35,000,000 but less than or equal to $50,000,000 so long
as least 90% of such aggregate consideration shall consist of
non-redeemable common stock and/or Qualified Preferred Stock of Workflow
(although the proviso contained in this clause (i) shall not apply to the
two $50,000,000 Permitted Acquisitions referred to above in this clause
(i)), (ii) no Default or Event of Default exists at the time of such
Permitted Acquisition or will exist as a result thereof, (iii) all of the
representations and warranties set forth in this Agreement are true and
correct in all material respects, both before and after giving effect to
any such Permitted Acquisition, (iv) in respect of each Permitted
Acquisition (or of all Permitted Acquisitions closing on the same date),
Workflow shall have delivered to the Agent an officer's certificate
executed by an Authorized Financial Officer of Workflow demonstrating (in
reasonable detail) that on a pro forma basis determined as if such
Permitted Acquisition (or Acquisitions) had been consummated on the first
day of the last Test Period of Workflow then ended (and assuming that any
Indebtedness incurred, issued or assumed in connection therewith had been
incurred, issued or assumed on the first day of, and had remained
outstanding throughout, such Test Period), Workflow would have been in
compliance with Sections 8.09 and 8.10 for such Test Period, (v) each such
Acquired Business shall be in a line of business permitted under Section
8.01, (vi) each such Acquired Business shall be domiciled in the United
States (including Puerto Rico) or Canada and shall derive at least 51% of
its revenues from its operations in the United States (including Puerto
Rico) and/or Canada, and (vii) immediately after giving effect to any such
Permitted Acquisition, the Unutilized Total Commitment shall be equal to at
least $5,000,000;
(g)(x) any Domestic Subsidiary (other than a Specified Subsidiary) of
Workflow may be merged with or into, or be dissolved or liquidated, into
Workflow or any U.S. Subsidiary Guarantor (other than a Specified
Subsidiary and a U.S. Subsidiary Guarantor that is not required to execute
and deliver, and has not executed and delivered, the respective Security
Documents), provided that (i) the resulting entity must be a U.S.
Subsidiary Guarantor unless such merger, dissolution or liquidation
involves Workflow, in which case Workflow must be the resulting entity, and
(ii) a Specified Subsidiary that is a Domestic Subsidiary may be merged
with or into, or be dissolved or liquidated into, a
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U.S. Subsidiary Guarantor so long as the Indebtedness (if any) of, and/or
Liens (if any) on the property of, such Specified Subsidiary would be
permitted to be incurred by such Subsidiary Guarantor under the provisions
hereof at the time of such merger, dissolution or liquidation and (y) any
Foreign Subsidiary (other than a Specified Subsidiary) may be merged with
or into, or be dissolved or liquidated into, DBF or any other Canadian
Credit Party (other than a Specified Subsidiary and a Canadian Credit Party
that is not required to execute and deliver, and has not executed and
delivered, the respective Security Documents), provided that (i) the
resulting entity must be a Canadian Credit Party and in the event that any
such merger, dissolution or liquidation involves DBF, DBF must be the
resulting entity, (ii) a Specified Subsidiary that is a Foreign Subsidiary
may be merged with or into, or be dissolved or liquidated into, a Canadian
Credit Party so long as (x) the Indebtedness (if any) of, and/or Liens (if
any) and the property of, such Specified Subsidiary would be permitted to
be incurred by such Canadian Credit Party under the provisions hereof at
the time of such merger, dissolution or liquidation and (y) the resulting
entity must be a Canadian Credit Party and in the event that any such
merger, dissolution or liquidation involves DBF, DBF must be the resulting
entity, and (iii) if any stock of any Foreign Subsidiary involved in such
merger, dissolution or liquidation was pledged under the U.S. Pledge
Agreement prior to such merger, dissolution or liquidation, at least 65% of
the total combined voting power of all classes of capital stock of the
surviving Foreign Subsidiary, and 100% of all other classes of capital
stock of such surviving Foreign Subsidiary in each case shall be pledged
pursuant to the U.S. Pledge Agreement; and
(h) each of Workflow and its Subsidiaries may grant leases or
subleases to other Persons not materially interfering with the conduct of
the business of Workflow or any of its Subsidiaries.
To the extent the Required Lenders waive the provisions of this Section 8.02
with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 8.02 (and such Collateral is released (or permitted to
be released) from the Liens created by the respective Security Document), such
Collateral in each case shall be sold free and clear of the Liens created by the
Security Documents and the Agent shall take such actions (including, without
limitation, directing the Collateral Agent to take such actions) as the Agent
deems appropriate, or as any Borrower may reasonably request, in connection
therewith.
8.03 Liens. No Borrower will, nor will any Borrower permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets of any kind (real or personal, tangible or
intangible) of such Borrower or any of its Subsidiaries, whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes) or assign any right
to receive income, except (Liens described below are herein referred to as
"Permitted Liens"):
62
(a) Liens for taxes not yet due or Liens for taxes being contested in
good faith and by appropriate proceedings for which adequate reserves have
been established in accordance with GAAP;
(b) Liens in respect of property or assets of Workflow and its
Subsidiaries imposed by law which were incurred in the ordinary course of
business and which have not arisen to secure Indebtedness for borrowed
money, such as carriers', warehousemen's and mechanics' Liens, statutory
landlord's Liens, and other similar Liens arising in the ordinary course of
business, and which either (x) do not in the aggregate materially detract
from the value of such property or assets or materially impair the use
thereof in the operation of the business of Workflow or any of its
Subsidiaries or (y) are being contested in good faith by appropriate
proceedings, which proceedings have the effect of preventing the forfeiture
or sale of the property or asset subject to such Lien;
(c) Liens created by or pursuant to this Agreement or the Security
Documents;
(d) Liens in existence on the Effective Date, and which are to
continue in effect after the Effective Date which are listed, and the
property subject thereto described, in Annex VIII, without giving effect to
any extensions or renewals thereof;
(e) Liens arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default under Section 9.09,
provided that no cash or property is deposited or delivered to secure the
respective judgment or award (or any appeal bond in respect thereof);
(f) Liens incurred or deposits made (x) in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security obligations, or to secure the
performance of tenders, statutory obligations, surety bonds, bids,
contracts, performance and return-of-money bonds and other similar
obligations incurred in the ordinary course of business (exclusive of
obligations in respect of the payment for borrowed money) and (y) to secure
the performance of leases of Real Property to the extent incurred or made
in the ordinary course of business consistent with past practices;
(g) licenses, leases or subleases granted to third Persons not
interfering in any material respect with the business of Workflow or any of
its Subsidiaries;
(h) Liens arising from precautionary UCC financing statements
regarding operating leases permitted by this Agreement;
(i) Liens created pursuant to Capital Leases permitted pursuant to
Section 8.04(b);
(j) Liens arising pursuant to purchase money mortgages or security
interests securing Indebtedness representing the purchase price (or
financing of the purchase price within 90 days after the respective
purchase) of assets acquired after the Effective Date,
63
provided, that (i) any such Liens attach only to the assets so purchased,
(ii) the Indebtedness secured by any such Lien does not exceed 100%, nor is
less than 80%, of the lesser of the fair market value or the purchase price
of the property being purchased at the time of the incurrence of such
Indebtedness, and (iii) the Indebtedness secured thereby is permitted to be
incurred pursuant to Section 8.04(b);
(k) Liens existing with respect to specific assets at the time
acquired pursuant to a Permitted Acquisition in compliance with Section
8.02(f) (and not to all such assets generally), provided that (x) any such
Liens, and the Indebtedness secured thereby, were not created at the time
of or in contemplation or anticipation of the acquisition of such assets by
the respective Credit Party, (y) the Indebtedness secured by any such Lien
does not exceed 100% of the fair market value of the asset to which such
Lien relates, determined at the time of the acquisition of such asset, and
(z) the Indebtedness secured thereby is permitted by Section 8.04(e);
(l) Permitted Encumbrances;
(m) Liens arising in the ordinary course of business in favor of
customs and revenue authorities which secure payment of customs duties in
connection with the importation of goods; and
(n) easements, rights-of-way, restrictions, encroachments and other
similar charges or encumbrances, and minor title deficiencies, in each case
not securing Indebtedness and not materially interfering with the conduct
of the business of Workflow or any of its Subsidiaries.
8.04 Indebtedness. No Borrower will, nor will any Borrower permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(b) Capitalized Lease Obligations and Indebtedness incurred pursuant
to purchase money Liens permitted by Section 8.03(j), provided, that the
sum of all such Capitalized Lease Obligations outstanding at any time plus
the aggregate principal amount of all such purchase money Indebtedness
outstanding at such time shall not exceed $5,000,000;
(c) Existing Debt listed on Annex VI, but only to the respective date,
if any, set forth on such Annex VI with respect to any particular issue of
Existing Debt, without giving effect to any subsequent extension, renewal
or refinancing thereof;
(d) Indebtedness (i) between and among Workflow and the U.S.
Subsidiary Guarantors (other than Specified Subsidiaries) and (ii) between
and among DBF and the other Canadian Credit Parties (other than Specified
Subsidiaries), provided, that if any such Indebtedness is evidenced by a
note, such note shall be in the form of an
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Intercompany Note that is pledged and delivered pursuant to the applicable
Pledge Agreement;
(e) Indebtedness of a Person outstanding at the time it is first
acquired by any Credit Party in a Permitted Acquisition pursuant to Section
8.02(f), provided that (A) any such Indebtedness was not created at the
time of or in contemplation or in anticipation of such Permitted
Acquisition and (B) the aggregate principal amount of all Indebtedness
permitted pursuant to this clause (e) in connection with any Permitted
Acquisition shall not exceed 10% of the aggregate purchase price of the
Person so acquired or of the assets so acquired, as the case may be, in
connection with such Permitted Acquisition;
(f) Indebtedness of any Borrower under Interest Rate Protection
Agreements entered into with respect to other Indebtedness of such Borrower
otherwise permitted under this Section 8.04;
(g) Indebtedness of Workflow or any of its Subsidiaries under Other
Hedging Agreements providing protection against fluctuations in currency
prices in connection with Workflow's or any of its Subsidiaries' ordinary
business operations so long as management of Workflow or such Subsidiary
has determined that the entering into of such Other Hedging Agreements are
bona fide hedging activities (and are not for speculative purposes)
relating to the ordinary business operations of Workflow or such
Subsidiary; and
(h) unsecured Indebtedness of Workflow and its Subsidiaries not
otherwise permitted by the foregoing clauses (a) through (g), provided that
the aggregate principal amount of all Indebtedness incurred pursuant to
this clause (h) shall not exceed $7,000,000 at any time outstanding.
8.05 Capital Expenditures. (a) No Borrower will, nor will any Borrower
permit any of its Subsidiaries to, make Consolidated Capital Expenditures,
provided that Workflow and its Subsidiaries may make Consolidated Capital
Expenditures so long as the aggregate amount of Consolidated Capital
Expenditures made during (x) the period (taken as one accounting period)
commencing on the Effective Date and ending with the last day of Workflow's
fiscal year ending closest to April 30, 1999 does not exceed $10,000,000 and (y)
each fiscal year (taken as one accounting period) thereafter commencing with the
fiscal year ending closest to April 30, 2000, does not exceed the Capital
Expenditure Amount for such fiscal year.
(b) In addition to the foregoing, the Credit Parties may make Consolidated
Capital Expenditures to the extent that same constitute a Permitted Acquisition
pursuant to Section 8.02(f) (it being understood that any Consolidated Capital
Expenditures made pursuant to this clause (b) will not reduce the amount of
Consolidated Capital Expenditures permitted to be made under clause (a) of this
Section 8.05).
(c) In addition to the foregoing, Workflow and its Subsidiaries may make
Consolidated Capital Expenditures with the Net Cash Proceeds of Asset Sales to
the extent such
65
proceeds are not required to be applied to reduce the Total Commitment pursuant
to Section 3.03(c).
(d) In addition to the foregoing, Workflow and its Subsidiaries may make
Consolidated Capital Expenditures with the Net Insurance Proceeds received by
Workflow or any of its Subsidiaries from any Recovery Event so long as such
Consolidated Capital Expenditures are to replace or restore any properties or
assets in respect of which such proceeds were paid within one year following the
date of the receipt of such insurance proceeds to the extent such Net Insurance
Proceeds are not required to be applied to reduce the Total Commitment pursuant
to Section 3.03(d).
8.06 Advances, Investments and Loans. No Borrower will, nor will any
Borrower permit any of its Subsidiaries to, directly or indirectly, lend money
or credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents (each of the foregoing an "Investment" and,
collectively, "Investments"), except that the following shall be permitted:
(a) Workflow and its Subsidiaries may invest in cash and Cash
Equivalents;
(b) Workflow and its Subsidiaries may acquire and hold receivables
owing to it, if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms of
Workflow or such Subsidiary, as the case may be;
(c) Workflow and its Subsidiaries may acquire and own investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in
the ordinary course of business;
(d) transactions permitted by Sections 8.02(b) and/or 8.04(d);
(e) Investments in existence on the Effective Date and listed on Annex
IX without giving effect to any additions thereto or replacements thereof;
(f) deposits made in the ordinary course of business consistent with
past practices to secure the performance of leases of Real Property;
(g) loans and advances to employees for moving and travel expenses and
other similar expenses, in each case incurred in the ordinary course of
business, in an aggregate outstanding principal amount not to exceed
$500,000 at any time (determined without regard to any write-down or
write-offs thereof);
(h) Permitted Acquisitions allowed pursuant to Section 8.02(f);
66
(i) each Borrower may enter into Interest Rate Protection Agreements
to the extent permitted by Section 8.04(f);
(j) Workflow and its Subsidiaries may enter into Other Hedging
Agreements to the extent permitted by Section 8.04(g); and
(k) Investments not otherwise permitted by the foregoing clauses (a)
through (j), inclusive, provided that the aggregate amount of all
Investments made pursuant to this clause (k) shall not exceed $6,000,000 at
any time (determined without regard to any write-downs or write-offs
thereof).
8.07 Dividends, etc. (a) No Borrower will, nor will any Borrower permit any
of its Subsidiaries to, declare or pay any dividends (other than dividends
payable solely in common stock of such Borrower or any such Subsidiary, as the
case may be) or return any capital to, its stockholders or authorize or make any
other distribution, payment or delivery of property or cash to its stockholders
as such, or redeem, retire, purchase or otherwise acquire, directly or
indirectly, for a consideration, any shares of any class of its capital stock
(other than the issuance of common stock of Workflow upon conversion of any
convertible preferred stock that may be issued by Workflow in accordance with
this Agreement), now or hereafter outstanding (or any warrants for or options or
stock appreciation rights in respect of any of such shares), or set aside any
funds for any of the foregoing purposes, and Workflow will not permit any of its
Subsidiaries to purchase or otherwise acquire for consideration any shares of
any class of the capital stock of the Borrower or any other Subsidiary, as the
case may be, now or hereafter outstanding (or any options or warrants or stock
appreciation rights issued by such Person with respect to its capital stock)
(all of the foregoing "Dividends"), except that: (x) any Subsidiary of Workflow
may pay Dividends to Workflow or any other Subsidiary of Workflow and (y)
repurchases may be made by Workflow of its capital stock and/or options or
warrants to purchase its capital stock from management or directors of Workflow
and its Subsidiaries so long as (i) no Default or Event of Default exists at the
time of such purchase and (ii) the aggregate amount paid by Workflow in
connection with all such repurchases does not exceed (x) $2,000,000 in the
aggregate for Workflow's fiscal years 1998 and 1999 taken together and (y)
$500,000 for each fiscal year of Workflow thereafter.
(b) No Borrower will, nor will any Borrower permit any of its Subsidiaries
to, create or otherwise cause or suffer to exist any encumbrance or restriction
which prohibits or otherwise restricts (A) the ability of any such Subsidiary to
(a) pay dividends or make other distributions or pay any Indebtedness owed to
the Borrower or any Subsidiary Guarantor, (b) make loans or advances to Workflow
or any Subsidiary of Workflow or (c) transfer any of its properties or assets to
Workflow or any Subsidiary of Workflow, or (B) the ability of Workflow or any
Subsidiary of Workflow, to create, incur, assume or suffer to exist any Lien
upon its property or assets to secure the Obligations, other than prohibitions
or restrictions existing under or by reason of: (i) this Agreement and the other
Credit Documents; (ii) applicable law; (iii) customary non-assignment provisions
entered into in the ordinary course of business and consistent with past
practices; and (iv) Liens permitted under Sections 8.03(i) and (j), and any
documents or instruments governing the terms of any Indebtedness or other
obligations secured
67
by any such Liens, provided that such prohibitions or restrictions apply only to
the assets subject to such Liens.
8.08 Transactions with Affiliates. No Borrower will, nor will any Borrower
permit any of its Subsidiaries to, enter into any transaction or series of
transactions with any Affiliate of such Borrower or any such Subsidiary other
than in the ordinary course of business and on terms and conditions
substantially as favorable to such Borrower or such Subsidiary as would be
obtainable by such Borrower or such Subsidiary at the time in a comparable
arm's-length transaction with a Person other than an Affiliate, provided that
(i) Dividends may be paid to the extent permitted by Section 8.03, (ii)
transactions between or among Workflow and its Subsidiaries pursuant to (and in
accordance with the terms of) Sections 8.02, 8.04 and 8.06 shall be permitted
and (iii) Workflow may enter into the Spinoff Documents.
8.09 Leverage Ratio. The Borrowers will not permit the Leverage Ratio of
Workflow at any time to be greater than 3.5:1.0.
8.10 Consolidated Interest Coverage Ratio. The Borrowers will not permit
the Consolidated Interest Coverage Ratio of Workflow for any Test Period ending
on the last day of a fiscal quarter of Workflow to be less than 2.0:1.0.
8.11 Limitation on Modifications of Certificate of Corporation, By-Laws and
Spinoff Documents; etc. (a) No Borrower will, nor will any Borrower permit any
of its Subsidiaries to:
(i) amend, modify or change in any manner adverse to the interests of
the Lenders, any of the Spinoff Documents, the certificate or articles of
incorporation (including, without limitation, by the filing of any
certificate of designation) or by-laws (or equivalent organizational
documents) of such Borrower or any of its Subsidiaries, as the case may be,
or any other agreement entered into by such Borrower or any of its
Subsidiaries with respect to its capital stock, or enter into any new
agreement with respect to the capital stock of such Borrower (to the extent
adverse to the interests of the Lenders) or any of its Subsidiaries; or
(ii) issue any class of capital stock other than (x) issuances of
non-redeemable common stock and (y) issuances by Workflow of Qualified
Preferred Stock.
(b) Workflow will not permit any of its Subsidiaries to issue any capital
stock (including by way of sales of treasury stock) or any options or warrants
to purchase, or securities convertible into, capital stock, except (i) for
transfers and replacements of then outstanding shares of capital stock, (ii) for
stock splits, stock dividends and issuances which do not decrease the percentage
ownership of Workflow or any of its Subsidiaries in any class of the capital
stock of such Subsidiary, (iii) to qualify directors to the extent required by
applicable law, and (iv) for issuances by newly created or acquired Subsidiaries
in accordance with the terms of this Agreement.
68
(c) In addition, Workflow will not issue any capital stock (including
pursuant to the exercise of options) on or after the Effective Date to the
extent that the issuance thereof would result, or could reasonably be expected
to result, in the Spinoff not qualifying as a tax free spin-off under Section
355 of the Code.
8.12 Limitation on the Creation of Subsidiaries. Notwithstanding anything
to the contrary contained in this Agreement, no Borrower will, nor will any
Borrower permit any of its Subsidiaries to, establish, create or acquire any
Subsidiary; provided that Wholly-Owned Subsidiaries may be established, created
or acquired in connection with a Permitted Acquisition so long as (i) in the
case of a Wholly-Owned Subsidiary created in order to effect a Permitted
Acquisition, such Subsidiary has no assets except those contributed
substantially contemporaneously with such Permitted Acquisition, (ii) the
capital stock of each such new Subsidiary is promptly pledged pursuant to, and
to the extent required by, the applicable Pledge Agreement and the certificates
representing such stock, together with stock powers duly executed in blank, are
delivered to the Collateral Agent, (iii) such new Subsidiary promptly executes a
counterpart of the applicable Guaranty (or another guaranty in substantially
similar form if needed), in each case on the same basis (and to the same extent)
as such Subsidiary would have executed such Guaranties if it were a Credit Party
on the Effective Date, (iv) such new Subsidiary, to the extent that is a
Material Subsidiary, executes a counterpart of the applicable Pledge Agreement
and Security Agreement (or another pledge agreement or security agreement, as
the case may be, in substantially similar form if needed), in each case on the
same basis (and to the same extent) as such Subsidiary would have executed such
Credit Documents if it were a Credit Party on the Effective Date, and (v) to the
extent requested by the Agent or the Required Lenders, any such new Subsidiary,
to the extent that it is a Material Subsidiary, takes all actions required
pursuant to Section 7.12.
SECTION 9. Events of Default. Upon the occurrence of any of the following
specified events (each an "Event of Default"):
9.01 Payments. Any Borrower shall (i) default in the payment when due of
any principal of (or any Face Amount of, as the case may be) the Loans or (ii)
default, and such default shall continue for three or more days, in the payment
when due of any Unpaid Drawing, any interest on the Loans or any Fees or any
other amounts owing hereunder or under any other Credit Document; or
9.02 Representations, etc. Any representation, warranty or statement made
or deemed made by any Borrower or any other Credit Party herein or in any other
Credit Document or in any written statement or certificate delivered pursuant
hereto or thereto shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
9.03 Covenants. Any Credit Party shall (a) default in the due performance
or observance by it of any term, covenant or agreement contained in Section
7.01(f)(x), 7.11 or 8, or (b) default in the due performance or observance by it
of any term, covenant or agreement (other than those referred to in Section
9.01, 9.02 or clause (a) of this Section 9.03) contained in this
69
Agreement and such default shall continue unremedied for a period of at least 30
days after notice to the defaulting party by the Agent or the Required Lenders;
or
9.04 Default Under Other Agreements. (a) Any Borrower or any of its
Subsidiaries shall (i) default in any payment with respect to any Indebtedness
(other than the Obligations) beyond the period of grace, if any, provided in the
instrument or agreement under which Indebtedness was created or (ii) default in
the observance or performance of any agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit the
holder or holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause any such Indebtedness to become due prior to its
stated maturity; or (b) any Indebtedness (other than the Obligations) of any
Borrower or any of its Subsidiaries shall be declared to be due and payable, or
shall be required to be prepaid other than by a regularly scheduled required
prepayment or as a mandatory prepayment, in each case prior to the stated
maturity thereof, provided that it shall not constitute an Event of Default
pursuant to clause (a) or (b) of this Section 9.04 unless the principal amount
of all such Indebtedness referred to in clauses (a) and (b) above equals or
exceeds $1,000,000 at any one time; or
9.05 Bankruptcy, etc. Any Borrower or any of its Subsidiaries shall
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bankruptcy Code"); or an involuntary case is commenced against any
Borrower or any of its Subsidiaries and the petition is not controverted within
10 days, or is not dismissed within 60 days, after commencement of the case; or
a custodian (as defined in the Bankruptcy Code) is appointed for, or takes
charge of, all or substantially all of the property of any Borrower or any of
its Subsidiaries; or commences any other proceeding under any bankruptcy,
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or
hereafter in effect relating to any Borrower or any of its Subsidiaries; or
there is commenced against any Borrower or any of its Subsidiaries any such
proceeding which remains undismissed for a period of 60 days; or any Borrower or
any of its Subsidiaries is adjudicated insolvent or bankrupt; or an order for
relief or other order approving any such case or proceeding is entered; or any
Borrower or any of its Subsidiaries suffers any appointment of any custodian,
receiver, trustee or the like for it or any substantial part of its property to
continue undischarged or unstayed for a period of 60 days; or any Borrower or
any of its Subsidiaries makes a general assignment for the benefit of creditors;
or any corporate action is taken by any Borrower or any of its Subsidiaries for
the purpose of effecting any of the foregoing; or
9.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding standard
required for any plan year or part thereof under Section 412 of the Code or
Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in
70
subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section 4043
shall be reasonably expected to occur with respect to such Plan within the
following 30 days, any Plan which is subject to Title IV of ERISA shall have had
or is likely to have a trustee appointed to administer such Plan, any Plan which
is subject to Title IV of ERISA is, shall have been or is likely to be
terminated or to be the subject of termination proceedings under ERISA, any Plan
shall have an Unfunded Current Liability, a contribution required to be made
with respect to a Plan or a Foreign Pension Plan has not been timely made,
Workflow or any Subsidiary of Workflow or any ERISA Affiliate has incurred or is
likely to incur any liability to or on account of a Plan under Section 409,
502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or
Section 401(a)(29), 4971 or 4975 of the Code or on account of a group health
plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code)
under Section 4980B of the Code, or Workflow or any Subsidiary of Workflow has
incurred or is likely to incur liabilities pursuant to one or more employee
welfare benefit plans (as defined in Section 3(1) of ERISA) that provide
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA) or Plans or Foreign Pension Plans; (b) there shall
result from any such event or events the imposition of a lien, the granting of a
security interest, or a liability or a material risk of incurring a liability;
and (c) such lien, security interest or liability, individually and/or in the
aggregate, in the reasonable opinion of the Required Lenders, has had, or could
reasonably be expected to have, a Material Adverse Effect; or
9.07 Security Documents. (a) Except in each case to the extent resulting
from the negligent or willful failure of the Collateral Agent to retain
possession of the applicable Pledged Securities, any Security Document shall
cease to be in full force and effect, or shall cease to give the Collateral
Agent the Liens, rights, powers and privileges purported to be created
thereby in favor of the Collateral Agent (or such other trustee as may be
required and desired under local law), or (b) any Credit Party shall default
in the due performance or observance of any term, covenant or agreement on
its part to be performed or observed pursuant to any such Security Document
and such default shall continue unremedied for a period of at least 30 days;
or
9.08 Guaranties. Any Guaranty or any provision thereof shall cease to be in
full force and effect, or any Guarantor or any Person acting by or on behalf of
such Guarantor shall deny or disaffirm such Guarantor's obligations under its
Guaranty or any Guarantor shall default in the due performance or observance of
any term, covenant or agreement on its part to be performed or observed pursuant
to its Guaranty; or
9.09 Judgments. One or more judgments or decrees shall be entered against
Workflow or any of its Subsidiaries involving a liability (to the extent not
paid or covered by a reputable and solvent insurance company) of $1,000,000 or
more (or, in the case of currencies other than Dollars, the Dollar Equivalent
thereof) for all such judgments and decrees and all such judgments or decrees
shall not have been vacated, paid, discharged or stayed or bonded pending appeal
within 30 days from the entry thereof; or
9.10 Change of Control. A Change of Control shall occur;
71
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Agent shall, upon the written request of the
Required Lenders, by written notice to the Borrowers, take any or all of the
following actions, without prejudice to the rights of the Agent or any Lender to
enforce its claims against any Guarantor or any Borrower (provided, that if an
Event of Default specified in Section 9.05 shall occur with respect to a
Borrower, the result which would occur upon the giving of written notice by the
Agent as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Total Commitment
terminated, whereupon the Commitment of each Lender shall forthwith terminate
immediately and any accrued Commitment Fees shall forthwith become due and
payable without any other notice of any kind; (ii) declare the principal of, the
Face Amount of and any accrued interest in respect of all Loans and all other
Obligations owing hereunder (including Unpaid Drawings) to be, whereupon the
same shall become, forthwith due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Borrowers; (iii) enforce, as Collateral Agent (or direct the Collateral Agent to
enforce), any or all of the Liens and security interests created pursuant to the
Security Documents; (iv) terminate any Letter of Credit which may be terminated
in accordance with its terms; (v) direct Workflow to pay (and Workflow hereby
agrees upon receipt of such notice, or upon the occurrence of any Event of
Default specified in Section 9.05, to pay) to the Collateral Agent at the
appropriate Payment Office such additional amounts of cash, to be held as
security for Workflow's reimbursement obligations in respect of Letters of
Credit then outstanding, equal to the aggregate Stated Amount of all Letters of
Credit then outstanding; (vi) apply any cash collateral held pursuant to Section
4.02 to the repayment of the Obligations; and (vii) direct the appropriate
Borrowers to pay (and each Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default specified in Section 9.05 with
respect to any Borrower, it will pay) to the Agent (without duplication) all
amounts required to be paid pursuant to clause (j) of Schedule III.
SECTION 10. Definitions. As used herein, the following terms shall have the
meanings herein specified unless the context otherwise requires. Defined terms
in this Agreement shall include in the singular number the plural and in the
plural the singular:
"Absolute Rate" shall mean an interest rate (rounded to the nearest .0001)
expressed as a decimal.
"Acceptance Fee" shall mean, in respect of a Bankers' Acceptance, a fee
calculated on the Face Amount of such Bankers' Acceptance at a rate per annum
equal to the Applicable Eurodollar Margin that would be payable with respect to
a Eurodollar Loan drawn on the Drawing Date of such Bankers' Acceptance.
"Acquired Business" shall mean each individual set of assets and/or Person
acquired pursuant to a Permitted Acquisition.
"Acquisition Date" shall have the meaning provided in Section 8.02(f).
"Acquisition Loan" shall mean any Revolving Loan or Competitive Bid Loan
incurred by any Borrower to finance a Permitted Acquisition.
72
"Acquisition Sub-Limit" shall mean, at any time, (x) $125,000,000 less (y)
17% of the aggregate reductions to the Total Commitment theretofore effected .
"Adjustment Date" shall have the meaning provided in Section 1.17(b).
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to control a corporation if
such Person possesses, directly or indirectly, the power (i) to vote 5% or more
of the securities having ordinary voting power for the election of directors of
such corporation or (ii) to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" shall have the meaning provided in the first paragraph of this
Agreement and shall include any successor to the Agent appointed pursuant to
Section 11.10.
"Aggregate Revolving Credit Exposure" shall mean, at any time, the sum of
(I) the aggregate principal amount of all Revolving Loans then outstanding (for
this purpose, (x) at all times prior to the occurrence of a Sharing Event and
the automatic conversion of Canadian Revolving Loans to Dollar Revolving Loans
pursuant to Section 1.16, using the Dollar Equivalent of the principal amount or
Face Amount, as the case may be, of each Canadian Revolving Loan then
outstanding and (y) at all times after any occurrence as described in preceding
clause (x), giving effect to the conversions to Dollar obligations required by
Section 1.16) plus (II) the aggregate principal amount of all Swingline Loans
and Competitive Bid Loans then outstanding plus (III) the aggregate amount of
all Letter of Credit Outstandings at such time.
"Agreement" shall mean this Credit Agreement, as the same may be from time
to time modified, amended and/or supplemented.
"Anticipated Reinvestment Amount" shall mean, with respect to any
Reinvestment Election, the amount specified in the Reinvestment Notice delivered
by Workflow in connection therewith as (x) the amount of the Net Cash Proceeds
from the related Asset Sale that Workflow and/or its Subsidiaries intend to use
to purchase, construct or otherwise acquire Reinvestment Assets or (y) the
amount of the Net Insurance Proceeds from the related Recovery Event that
Workflow and/or its Subsidiaries intend to use to purchase or construct
Reinvestment Assets in respect of the asset subject to such Recovery Event.
"Applicable Base Rate/Canadian Prime Rate Margin" shall mean the margin
determined in accordance with the schedule below based on the Leverage Ratio of
Workflow for the Test Period then last ended and as determined from the most
recent financial statements of Workflow (and related compliance certificate)
timely delivered to the Lenders pursuant to Section 7.01(a) or (b), as the case
may be, provided that (x) so long as any Default or Event of Default then
exists, the Applicable Base Rate/Canadian Prime Rate Margin shall be equal to
the highest percentage set forth in the table below and (y) to the extent that,
on the date of the consummation by Workflow or any of its Subsidiaries of any
Permitted Acquisition, the Leverage Ratio of Workflow is increased (after giving
effect to such Permitted Acquisition) and such
73
increase would result in a higher Applicable Base Rate/Canadian Prime Rate
Margin in accordance with the schedule below, such increase in the Applicable
Base Rate/Canadian Prime Rate Margin shall take effect from such date until the
next date upon which the financial statements referred to above are required to
be delivered to the Lenders:
Applicable
Base Rate/Canadian
Leverage Ratio Prime Rate Margin
- -------------- -----------------
Greater than or equal to 3.0:1 .500%
Less than 3.0:1 but greater than or equal to 2.5:1 .250%
Less than 2.5:1 .0%
; provided further, that, notwithstanding the foregoing, (i) for the period from
the Effective Date through (but not including) the date of delivery of the first
set of financial statements pursuant to Section 7.01(a) or (b), as the case may
be, the Applicable Base Rate/Canadian Prime Rate Margin shall be .250% (as such
percentage may be increased as a result of clause (x) or (y) of the preceding
proviso) and (ii) at no time during the period beginning on the Effective Date
and ending with the delivery of the financial statements pursuant to Section
7.01(b) in respect of Workflow's fiscal quarter ending closest to October 31,
1998, shall the Applicable Base Rate Margin be less than .250%.
"Applicable Commitment Fee Percentage" shall mean the percentage determined
in accordance with the schedule below based on the Leverage Ratio of Workflow
for the Test Period then last ended and as determined from the most recent
financial statements of Workflow (and related compliance certificate) timely
delivered to the Lenders pursuant to Section 7.01(a) or (b), as the case may be,
provided that (x) so long as any Default or Event of Default then exists, the
Applicable Commitment Fee Percentage shall be equal to the highest percentage
set forth in the table below and (y) to the extent that, on the date of the
consummation by Workflow or any of its Subsidiaries of any Permitted
Acquisition, the Leverage Ratio of Workflow is increased (after giving effect to
such Permitted Acquisition) and such increase would result in a higher
Applicable Commitment Fee Percentage in accordance with the below schedule, such
increase in the Applicable Commitment Fee Percentage shall take effect from such
date until the next date upon which the financial statements referred to above
are required to be delivered to the Lenders:
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Applicable
Leverage Ratio Commitment Fee Percentage
-------------- -------------------------
Greater than or equal to 3.0:1 .470%
Less than 3.0:1 but greater than or equal to 2.5:1 .400%
Less than 2.5:1 but greater than or equal to 2.0:1 .300%
Less than 2.0:1 .250%
; provided further, that, notwithstanding the foregoing, for the period from the
Effective Date through (but not including) the date of delivery of the first set
of financial statements pursuant to Section 7.01(a) or (b), as the case may be,
the Applicable Commitment Fee Percentage shall be .250% (as such percentage may
be increased as a result of clause (x) or (y) of the preceding proviso).
"Applicable Currency" shall mean, with respect to any Obligations, Dollars
or, to the extent relating to Canadian Revolving Loans, Canadian Dollars.
"Applicable Eurodollar Margin" shall mean the margin determined in
accordance with the schedule below based on the Leverage Ratio of Workflow for
the Test Period then last ended and as determined from the most recent financial
statements of Workflow (and related compliance certificate) timely delivered to
the Lenders pursuant to Section 7.01(a) or (b), as the case may be, provided
that (x) so long as any Default or Event of Default then exists, the Applicable
Eurodollar Margin shall be equal to the highest percentage set forth in the
table below and (y) to the extent that, on the date of the consummation by of
Workflow or any of its Subsidiaries of any Permitted Acquisition, the Leverage
Ratio of Workflow is increased (after giving effect to such Permitted
Acquisition) and such increase would result in a higher Applicable Eurodollar
Margin in accordance with the schedule below, such increase in the Applicable
Eurodollar Margin shall take effect from such date until the next date upon
which the financial statements referred to above are required to be delivered to
the Lenders:
Applicable
Eurodollar
Leverage Ratio Rate Margin
-------------- -----------
Greater than or equal to 3.0:1 1.500%
Less than 3.0:1 but greater than or equal to 2.5:1 1.250%
Less than 2.5:1 but greater than or equal to 2.0:1 1.000%
Less than 2.0:1 but greater than or equal to 1.0:1 .750%
Less than 1.0:1 .625%
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; provided further, that, notwithstanding the foregoing, (i) for the period from
the Effective Date through (but not including) the date of delivery of the first
set of financial statements pursuant to Section 7.01(a) or (b), as the case may
be, the Applicable Eurodollar Margin shall be 1.250% (as such percentage may be
increased as a result of clause (x) or (y) of the preceding proviso) and (iii)
at no time during the period beginning on the Effective Date and ending with the
delivery of the financial statements pursuant to Section 7.01(b) in respect of
Workflow's fiscal quarter ending closest to October 31, 1998, shall the
Applicable Eurodollar Margin be less than 1.250%.
"Asset Sale" shall mean the sale, transfer or other disposition (or series
of related sales, transfers or dispositions) by Workflow or any Subsidiary of
Workflow after the Effective Date to any Person other than Workflow or any
Subsidiary of Workflow of any asset of Workflow or such Subsidiary (other than
sales, transfers or other dispositions (x) in the ordinary course of business of
inventory and/or obsolete or worn-out equipment or (y) the proceeds of which do
not exceed $1,000,000 in any fiscal year of Workflow).
"Assignment and Assumption Agreement" shall have the meaning provided in
Section 12.04(b).
"Authorized Financial Officer" shall mean the chief financial officer, the
treasurer, any assistant treasurer or the corporate controller of Workflow or
DBF, as appropriate.
"BA Discount Proceeds" shall mean, in respect of any Bankers Acceptance to
be purchased by a Canadian Lender on any date pursuant to Section 1.01 and Annex
III, an amount rounded to the nearest whole Canadian cent, and with one-half of
one Canadian cent being rounded up, calculated on such day by dividing:
(a) the Face Amount of such Banker's Acceptance; by
(b) the sum of one plus the product of:
(i) the respective Canadian Lender's Discount Rate (expressed as a
decimal) applicable to such Bankers' Acceptance; and
(ii) a fraction, the numerator of which is the number of days in the
term of maturity of such Banker's Acceptance and the denominator of which
is 365;
with such product rounded up or down to the fifth decimal place and
with .000005 being rounded up.
"Bankers' Acceptance" shall mean a Draft accepted by a Canadian Lender
pursuant to Section 1.01 and Annex III.
"Bankers' Acceptance Loans" shall mean the creation and discount of
Bankers' Acceptances as contemplated in Section 1.01 and Annex III.
"Bankruptcy Code" shall have the meaning provided in Section 9.05.
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"Base Rate" shall mean, at any time, the higher of (x) the rate which is
1/2 of 1% in excess of the Federal Funds Effective Rate and (y) the Prime
Lending Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii) each Dollar
Revolving Loan designated or deemed designated as such by Workflow at the time
of the incurrence thereof or conversion thereto.
"Benefited Lender" shall have the meaning provided in Section 12.06(b).
"Bidder Lender" shall mean each Lender that has informed the Agent and
Workflow in writing (which has not been retracted) that such Lender desires to
participate generally in the bidding arrangements relating to Competitive Bid
Borrowings.
"Borrower" shall have the meaning provided in the first paragraph of this
Agreement.
"Borrowing" shall mean and include (i) the incurrence of Swingline Loans
from BTCo on a certain date, (ii) the incurrence of one Type of Dollar Revolving
Loan by Workflow from all of the Lenders on a pro rata basis on a given date (or
resulting from conversions on a given date), having in the case of Eurodollar
Loans the same Interest Period, provided, that Base Rate Loans incurred pursuant
to Section 1.11(b) shall be considered part of any related Borrowing of
Eurodollar Loans, (iii) the incurrence of one Type of Canadian Revolving Loan by
DBF from all of the Canadian Lenders on a pro rata basis on a given date, having
in the case of Bankers' Acceptance Loans, underlying Bankers' Acceptances with
the same maturities and (iv) a Competitive Bid Borrowing.
"BTCo" shall mean Bankers Trust Company and any successor corporation
thereto by merger, consolidation or otherwise.
"Business Day" shall mean (i) for all purposes other than as covered by
clauses (ii) and (iii) below, any day excluding Saturday, Sunday and any day
which shall be in the City of New York a legal holiday or a day on which banking
institutions are authorized by law or other governmental actions to close, (ii)
with respect to all notices and determinations in connection with, and payments
of principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in U.S. dollar deposits in the interbank Eurodollar market and (iii) with
respect to all notices and determinations in connection with, and payments of
principal and interest on, Canadian Revolving Loans made to DBF, any day which
is a Business Day described in clauses (i) and, if relevant, (ii) above and
which is also a day which is not a legal holiday or a day on which banking
institutions are authorized or required by law or other government action to
close in Toronto, Ontario and, if different, in the city where the applicable
Payment Office of the Agent is located in respect of Canadian Revolving Loans.
"Canadian Credit Party" shall mean DBF, each Canadian Parent and each other
Subsidiary of Workflow organized under the laws of Canada or any province
thereof.
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"Canadian Dollar Equivalent" shall mean, at any time for the determination
thereof, the amount of Canadian Dollars which could be purchased with the amount
of Dollars involved in such computation at the spot rate of exchange therefor as
quoted by the Agent as of 11:00 A.M. (New York time) on the date two Business
Days prior to the date of any determination thereof for purchase on such date.
"Canadian Dollars" and "Cdn" shall mean freely and transferable lawful
money of Canada.
"Canadian General Guaranty" shall have the meaning provided in Section
5.10(b).
"Canadian Guaranty" shall mean and include each of the Canadian General
Guaranty and the Canadian Parent Guaranty.
"Canadian Lender" shall mean (i) each Lender listed on Annex I-B, and (ii)
each additional Person that becomes a Canadian Lender party hereto in accordance
with Section 1.14 or 12.04(b). A Canadian Lender shall cease to be a "Canadian
Lender" when it has assigned all of its Canadian Sub-Commitment in accordance
with Section 1.14 and/or 12.04(b). For purposes of this Agreement, the term
"Lender" includes each Canadian Lender unless the context otherwise requires.
"Canadian Parent" shall mean each of 3303471 Canada, Inc., a Canadian
federal corporation and the direct parent company of DBF and 1186202 Ontario
Limited, a Canadian federal corporation and the direct parent company of 3303471
Canada, Inc.
"Canadian Parent Guaranty" shall have the meaning provided in Section
5.10(b).
"Canadian Percentage" of any Lender at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Canadian
Sub-Commitment of such Lender at such time and the denominator of which is the
aggregate amount of Canadian Sub-Commitments of all Canadian Lenders at such
time, provided that if the Canadian Percentage of any Canadian Lender is to be
determined after the Total Commitment has been terminated, then the Canadian
Percentage of the Canadian Lenders shall be determined immediately prior (and
without giving effect) to such termination.
"Canadian Pledge Agreement" shall have the meaning provided in Section
5.11(b).
"Canadian Prime Rate" shall mean, at any time, the greater of (i) the per
annum rate of interest quoted, published and commonly known as the "prime rate"
of BT Bank of Canada which BT Bank of Canada establishes at its main office in
Toronto, Ontario, Canada as the reference rate of interest in order to determine
interest rates for loans in Canadian Dollars to its Canadian borrowers, adjusted
automatically with each quoted or published change in such rate, all without
necessity of any notice to any Borrower or any other Person and (ii) the sum of
(I) the average of the rates per annum for Canadian Dollar bankers' acceptances
having a term of 30 days that appears on the Reuters Screen CDOR Page as of
10:00 A.M. (Toronto time) on the
78
date of determination, as reported by BT Bank of Canada (and if such screen is
not available, any successor or similar services may be selected by BT Bank of
Canada), plus (II) 0.75%.
"Canadian Prime Rate Loans" shall mean any Canadian Revolving Loan
designated or deemed designated as such by DBF at the time of the incurrence
thereof or conversion thereto.
"Canadian Revolving Loan" shall have the meaning provided in Section
1.01(a).
"Canadian Revolving Note" shall have the meaning provided in Section
1.06(a).
"Canadian Security Agreement" shall have the meaning provided in Section
5.11(c).
"Canadian Sub-Commitment" shall mean, as to any Canadian Lender, (i) the
amount, if any, set forth opposite such Lender's name in Annex I-B directly
below the column entitled "Canadian Sub-Commitment", as same may be (x) reduced
from time to time pursuant to Sections 3.02, 3.03 and/or 9 or (y) adjusted from
time to time as a result of assignments to or from such Lender pursuant to
Section 1.14 or 12.04(b). The Canadian Sub-Commitment of each Canadian Lender is
a sub-limit of the Commitment of the respective Canadian Lender (or its
respective Affiliate which is a Lender with the related Commitment) and not an
additional commitment and, in no event, may exceed at any time, the Commitment
of such Canadian Lender (or its respective Affiliate which is a Lender with the
related Commitment).
"Capital Expenditure Amount" shall mean, for any fiscal year of Workflow
set forth in Section 8.05(a)(y), the sum of (x) $6,000,000 plus (y) 15% of the
Consolidated EBITDA of Workflow for the immediately preceding fiscal year.
"Capital Lease," as applied to any Person, shall mean any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Capitalized Lease Obligations" shall mean all obligations under Capital
Leases of Workflow or any of its Subsidiaries in each case taken at the amount
thereof accounted for as liabilities in accordance with GAAP.
"Cash Equivalents" shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided, that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than six months from the date of acquisition, (ii) Dollar denominated time
deposits, certificates of deposit and bankers acceptances of (x) any Lender or
(y) any bank whose short-term commercial paper rating from Standard & Poor's
Ratings Service ("S&P") is at least A-1 or the equivalent thereof or from
Moody's Investors Service, Inc. ("Moody's") is at least P-1 or the equivalent
thereof (any such bank or Lender, an "Approved Lender"), in each case with
maturities of not more than six months from the date of acquisition, (iii)
commercial paper issued by any Approved Lender or by the parent company of any
79
Approved Lender and commercial paper issued by, or guaranteed by, any industrial
or financial company with a short-term commercial paper rating of at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's, or guaranteed by any industrial company with a long term unsecured debt
rating of at least A or A2, or the equivalent of each thereof, from S&P or
Moody's, as the case may be, and in each case maturing within six months after
the date of acquisition, (iv) marketable direct obligations issued by any state
of the United States of America or any political subdivision of any such state
or any public instrumentality thereof maturing within six months from the date
of acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody's, (v) repurchase
obligations with a term of not more than seven days for underlying securities of
the type described in clause (i) above and entered into with any Approved
Lender, (vi) investments in money market funds substantially all the assets of
which are comprised of securities of the types described in clauses (i) through
(v) above and (vii) in the case of any Subsidiary of Workflow organized under
the laws of Canada or any province thereof, (A) government obligations of Canada
having maturities of not more than six months from the date of acquisition and
(B) Canadian Dollar denominated time deposits, certificates of deposit and
banker's acceptances of any Approved Lender, in each case with maturition of not
more than six months from the date of acquisition.
"Cash Proceeds" shall mean, (i) with respect to any Asset Sale, the
aggregate cash payments (including any cash as and when received by way of
deferred payment pursuant to a promissory note, receivable or otherwise)
received by Workflow and/or any Subsidiary of Workflow from such Asset Sale and
(ii) with respect to any Recovery Event, the aggregate cash payments received by
Workflow and/or any Subsidiary of Workflow from such Recovery Event.
"Change of Control" shall mean if (a) any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act) (i) is or shall
become the "beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the
Exchange Act), directly or indirectly, of 20% or more on a fully diluted basis
of the voting and economic interests of Workflow or (ii) shall have obtained the
power (whether or not exercised) to elect a majority of Workflow's directors or
(b) the Board of Directors of Workflow shall cease to consist of a majority of
Continuing Directors.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code, as in effect at the date of this
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all of the Collateral as defined in (or subject to
the security interest of) each of the Security Documents, as well as all cash
and Cash Equivalents delivered as collateral pursuant to this Agreement.
"Collateral Agent" shall mean the Agent acting as collateral agent for the
Secured Creditors.
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"Commitment" shall mean, at any time and with respect to each Lender, the
amount set forth opposite such Lender's name in Annex I-A directly under the
column entitled "Commitment," as the same may be reduced from time to time
pursuant to Section 3.02, 3.03 or 9 or adjusted from time to time as a result of
assignments to or from such Lender as provided for in Sections 1.14 and 12.04.
"Commitment Expiration Date" shall mean July 20, 1998.
"Commitment Fee" shall have the meaning provided in Section 3.01(a).
"Competitive Bid Borrowing" shall mean each borrowing of any Competitive
Bid Loan.
"Competitive Bid Loan" shall have the meaning provided in Section 1.01(d)
"Competitive Bid Loan Maturity Date" shall have the meaning provided in
Section 1.04(a).
"Competitive Bid Notes" shall have the meaning provided in Section 1.06(a).
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum, dated May 1998, distributed to the Lenders prior to the
Effective Date in connection with this Agreement.
"Consolidated Capital Expenditures" shall mean, for any period, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including in all events all amounts expended or capitalized under Capital
Leases but excluding any amount representing capitalized interest) by Workflow
and its Subsidiaries during that period that, in conformity with GAAP, are or
are required to be included in the property, plant or equipment reflected in the
consolidated balance sheet of Workflow and its Subsidiaries, provided that
Consolidated Capital Expenditures shall in any event include the purchase price
paid in connection with the acquisition of any Person (including through the
purchase of all of the capital stock or other ownership interests of such Person
or through merger or consolidation) to the extent allocable to property, plant
and equipment.
"Consolidated EBIT" shall mean, for any period with respect to any Person,
Consolidated Net Income of such Person, before (i) interest income, (ii)
Consolidated Interest Expense, and (iii) provision for taxes and without giving
effect to any extraordinary gains or extraordinary losses or gains from sales of
assets (other than sales of inventory in the ordinary course of business).
"Consolidated EBITDA" shall mean, for any period with respect to any
Person, Consolidated EBIT of such Person for such period, adjusted by adding
thereto the amount of all depreciation expense and amortization expense deducted
in determining such Consolidated EBIT for such period, provided that there shall
be included in determining Consolidated EBITDA of Workflow and its Subsidiaries
for any period, the Consolidated EBITDA for each Acquired
81
Business acquired by Workflow or any Subsidiary of Workflow during such period
for the portion of such period prior to such acquisition but excluding, in a
manner and to the extent satisfactory to the Agent, (i) any non-recurring
charges (as determined pursuant to GAAP) incurred in connection with the
Transaction and the IPO otherwise included in the computation of Consolidated
EBITDA and (ii) from the computation of Consolidated EBITDA of such Acquired
Business, any non-recurring charges (as determined pursuant to GAAP) otherwise
included in such computation.
"Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of Consolidated EBITDA to Consolidated Interest Expense for such period.
"Consolidated Interest Expense" shall mean, for any period with respect to
any Person, the total interest expense (including that attributable to Capital
Leases in accordance with GAAP) of such Person determined on a consolidated
basis with respect to all outstanding Indebtedness of such Person, including,
without limitation, all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing, but
excluding, however, amortization of deferred financing costs to the extent
included in total interest expense, provided that there shall be included in
determining Consolidated Interest Expense of Workflow and its Subsidiaries for
any period, (x) the Consolidated Interest Expense for each Acquired Business
acquired by Workflow or any Subsidiary of Workflow during such period for the
portion of such period prior to such acquisition and (y) the additional interest
that would have been paid on all Indebtedness incurred by Workflow and its
Subsidiaries to finance each Permitted Acquisition effected during such period
if, in each such case, such Indebtedness had been incurred on the first day of
such period, as reasonably determined by Workflow in a manner satisfactory to
the Agent.
"Consolidated Net Income" shall mean, for any period with respect to any
Person, the net income (or loss), after provision for taxes, of such Person on a
consolidated basis (but after deduction for minority interests) for such period
taken as a single accounting period, provided that (i) the net income (but not
loss) of any Person that is not a Subsidiary of Workflow or that is accounted
for by Workflow by the equity method of accounting shall be included only to the
extent of such amount of cash dividends or distributions paid to Workflow or a
Wholly-Owned Subsidiary thereof, (ii) the net income of any Subsidiary of
Workflow shall be excluded to the extent that the declaration or payment of
dividends or distributions by such Subsidiary of that net income is not as at
the date of determination permitted by operation of the terms of its charter or
any agreement, instrument, judgment, decree, order, statute, law, rule or
governmental regulation and (iii) the net income of any Person acquired in a
pooling of interests transaction for any period prior to the date of such
acquisition shall be excluded.
"Contingent Obligations" shall mean, as to any Person, any obligation of
such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent,
(a) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (b) to advance or supply funds (x) for the
purchase or payment of any
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such primary obligation or (y) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) 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 (d)
otherwise to assure or hold harmless the owner of such primary obligation
against loss in respect thereof; provided, however, that the term Contingent
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of Workflow on the
Effective Date and each other director thereof if such director's nomination for
the election to the Board of Directors of Workflow is recommended by a majority
of the then Continuing Directors.
"Credit Documents" shall mean this Agreement, each Note, each Bankers'
Acceptance, each Guaranty, and each Security Document.
"Credit Event" shall mean (i) the occurrence of the Effective Date and (ii)
the making of a Loan or the issuance of a Letter of Credit.
"Credit Party" shall mean each U.S. Credit Party, each Canadian Credit
Party and each other Foreign Subsidiary of Workflow that is required to execute
a Credit Document pursuant to this Agreement.
""DBF" shall have the meaning provided in the introductory paragraph of
this Agreement.
"Default" shall mean any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with respect to which a Lender
Default is in effect.
"Discount Rate" shall mean, in respect of any Bankers' Acceptances to be
purchased by a Canadian Lender pursuant to Section 1.01 and Annex III, the
discount rate (calculated on an annual basis and rounded to the nearest 1/100 of
1%, with 5/1000 of 1% being rounded up) quoted by such Canadian Lender at 10:00
A.M. (Toronto time) as the discount rate at which such Canadian Lender would
purchase, on the relevant Drawing Date, its own bankers' acceptances having an
aggregate Face Amount equal to and with a term to maturity the same as the
Bankers' Acceptances to be acquired by such Canadian Lender on such Drawing
Date.
"Dividends" shall have the meaning provided in Section 8.07.
83
"Documents" shall mean the Spinoff Documents, the Credit
Documents and, after the execution thereof, the IPO Documents (it being
understood that nothing in this Agreement shall require Workflow to consummate
the IPO).
"Dollar Equivalent" of an amount denominated in Canadian Dollars shall
mean, at any time for the determination thereof, the amount of Dollars which
could be purchased with the amount of Canadian Dollars involved in such
computation at the spot exchange rate therefor as quoted by the Agent as of
11:00 A.M. (New York time) on the date two Business Days prior to the date of
any determination thereof for purchase on such date; provided that (1) for
purposes of Section 1.16, the Dollar Equivalent of any amount expressed in
Canadian Dollars shall be the amount of Dollars that the Agent determines, based
upon the actual exchange rates which the Agent believes can be obtained on the
date of conversion pursuant to Section 1.16, would be required to be paid in
Dollars to purchase such amount of Canadian Dollars and (2) for purposes of (x)
determining compliance with Sections 1.01, 2.01(c) and 4.02(a) and (y)
calculating Fees pursuant to Section 3.01, the Dollar Equivalent of any amounts
outstanding in a currency other than Dollars shall be revalued on a monthly
basis using the spot exchange rate therefor quoted in the Wall Street Journal on
the last Business Day of each month, provided that, at any time during a month,
if the full principal amount of Canadian Revolving Loans permitted to be
incurred pursuant to this Agreement (i.e., up to the full amount of the
respective Canadian Sub-Commitments as then in effect) were incurred, and if the
Dollar Equivalent as recalculated based on the exchange rate therefor quoted in
the Wall Street Journal on the respective date of determination pursuant to this
exception would result in an increase in the Dollar Equivalent as then in effect
of such amounts of 5% or more, then at the discretion of the Agent or at the
request of the Required Lenders, the Dollar Equivalent shall be reset based upon
the exchange rates quoted on such date in the Wall Street Journal, which rates
shall remain in effect until the last Business Day of such month or such earlier
date, if any, as the rate is reset pursuant to this proviso. Notwithstanding
anything to the contrary contained in this definition, at any time that a
Default or an Event of Default then exists, the Agent may revalue the Dollar
Equivalent of any amounts outstanding under the Credit Documents in a currency
other than Dollars in its sole discretion.
"Dollar Loan" shall mean each Dollar Revolving Loan, each Competitive Bid
Loan and each Swingline Loan.
"Dollar Percentage" of any Lender at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Dollar Sub-Commitment
of such Lender at such time and the denominator of which is the aggregate amount
of Dollar Sub-Commitments of all Lenders at such time. Notwithstanding anything
to the contrary contained above, if the Dollar Percentage of any Lender is to be
determined after the Total Commitment has been terminated, then the Dollar
Percentages of the Lenders shall be determined immediately prior (and without
giving effect) to such termination.
"Dollar Revolving Loan" shall have the meaning provided in Section 1.01(a).
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"Dollar Revolving Note" shall have the meaning provided in Section 1.06(a).
"Dollar Sub-Commitment" shall mean, for any Lender at any time, such
Lender's Commitment at such time minus, in the case of a Lender that is, or
whose Affiliate is, a Canadian Lender, such Canadian Lender's Canadian
Sub-Commitment at such time.
"Dollars" and the sign "$" shall each mean freely transferable lawful money
of the United States.
"Domestic Subsidiary" shall mean each Subsidiary of Workflow which is not a
Foreign Subsidiary.
"Draft" shall mean, at any time, a blank bill of exchange, within the
meaning of the Bills of Exchange Act (Canada), drawn by any Borrower on Canadian
Lender and bearing such distinguishing letters and numbers as such Canadian
Lender may determine, but which at such time has not been completed or accepted
by such Canadian Lender.
"Drawing Date" shall mean any Business Day fixed pursuant to Annex III for
the creation and purchase of Bankers' Acceptances by a Canadian Lender.
"Effective Date" shall have the meaning provided in Section 12.10.
"Eligible Transferee" shall mean and include a commercial bank, financial
institution, any fund that invests in loans or any other "accredited investor"
(as defined in SEC Regulation D).
"Environmental Claims" shall mean any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violation, investigations or proceedings relating in any way
to any Environmental Law (hereafter "Claims") or any permit issued under any
such law, 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, and
(b) any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of injury to
health, safety or the environment.
"Environmental Law" shall mean any federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, policy or rule of common law
now or hereafter in effect and in each case as amended, and any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to the
environment, health, safety or Hazardous Materials, including, without
limitation, CERCLA, RCRA, the Federal Water Pollution Control Act, as
amended, 33 U.S.C. Section 1251 et seq., the Toxic Substances Control Act, 15
U.S.C. Section 7401 et seq., the Clean Air Act, 42 U.S.C. Section 7401 et
seq., the Safe Drinking Water Act, 42 U.S.C. Section 3808 et seq., the Oil
Pollution Act of 1990, 33 U.S.C. Section 2701 et seq., the Emergency Planning
and the Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.,
the Hazardous Material Transportation Act, 49 U.S.C. Section 1801 et seq.,
the Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq., and
any applicable state and local or foreign counterparts or equivalents.
85
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9) of
ERISA) which together with Workflow or a Subsidiary of Workflow would be deemed
to be a "single employer" (i) within the meaning of Section 414(b), (c), (m) or
(o) of the Code or (ii) as a result of Workflow or a Subsidiary of Workflow
being or having been a general partner of such person.
"Eurodollar Loans" shall mean each Dollar Revolving Loan designated as such
by Workflow of the time of incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean, with respect to each Interest Period for a
Eurodollar Loan, (i) the arithmetic average (rounded to the nearest 1/100 of 1%)
of the offered quotations to first-class banks in the interbank Eurodollar
market by the Agent for Dollar deposits of amounts in same day funds comparable
to the outstanding principal amount of the Eurodollar Loan of the Agent for
which an interest rate is then being determined with maturities comparable to
the Interest Period to be applicable to such Eurodollar Loan, determined as of
10:00 A.M. (New York time) on the date which is two Business Days prior to the
commencement of such Interest Period divided (and rounded upward to the next
whole multiple of 1/16 of 1%) by (ii) a percentage equal to 100% minus the then
stated maximum rate of all reserve requirements (including, without limitation,
any marginal, emergency, supplemental, special or other reserves) applicable to
any member bank of the Federal Reserve System in respect of Eurocurrency
liabilities as defined in Regulation D (or any successor category of liabilities
under Regulation D).
"Event of Default" shall have the meaning provided in Section 9.
"Existing Debt" shall have the meaning provided in Section 6.21.
"Existing Indebtedness Agreements" shall have the meaning provided in
Section 5.15(vi).
"Face Amount" shall mean, in respect of a Bankers' Acceptance, the amount
payable to the holder thereof on its maturity. The Face Amount of any Bankers'
Acceptance Loan shall be equal to the Face Amounts of the underlying Bankers'
Acceptances.
"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Effective Rate" shall mean, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Lender of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
86
transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by the Agent.
"Fees" shall mean all amounts payable pursuant to, or referred to in,
Section 3.01.
"Final Maturity Date" shall mean June 10, 2003.
"Foreign Pension Plan" shall mean any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained outside the United States of America by Workflow or any one or more
of its Subsidiaries primarily for the benefit of employees of Workflow or such
Subsidiaries residing outside the United States of America, which plan, fund or
other similar program provides, or results in, retirement income, a deferral of
income in contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.
"Foreign Subsidiary" shall mean each Subsidiary of Workflow that is
incorporated under the laws of any jurisdiction other than the United States of
America or any State thereof.
"GAAP" shall mean generally accepted accounting principles in the United
States of America as in effect from time to time; it being understood and agreed
that determinations in accordance with GAAP for purposes of Section 8, including
defined terms as used therein, are subject (to the extent provided therein) to
Section 12.07(a).
"Guarantor" shall mean and include Workflow, in is capacity as a Guarantor
under the Canadian General Guaranty, and each Subsidiary Guarantor.
"Guaranty" shall mean and include each of the U.S. Subsidiaries Guaranty,
the Canadian General Guaranty, the Canadian Parent Guaranty and each other
guaranty required to be executed pursuant to Section 8.12.
"Hazardous Materials" shall mean (a) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas, (b) any chemicals, materials or substances defined as or included in
the definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "restricted hazardous materials," "extremely hazardous wastes,"
"restrictive hazardous wastes," "toxic substances," "toxic pollutants,"
"contaminants" or "pollutants," or words of similar meaning and regulatory
effect under any applicable Environmental Law and (c) any other chemical,
material or substance, the Release of which is prohibited, limited or regulated
by any applicable Environmental Law.
"Indebtedness" shall mean, as to any Person, without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) the deferred purchase price
of assets or services payable to the sellers thereof or any of such seller's
assignees which in accordance with GAAP would be shown on the liability side of
the balance sheet of such Person, (iii) the face amount of
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all letters of credit, bankers' acceptances and similar obligations issued and
outstanding for the account of such Person and, without duplication, all drafts
drawn thereunder, (iv) all Indebtedness of a second Person secured by any Lien
on any property owned by such first Person, whether or not such Indebtedness has
been assumed (provided that if such Indebtedness has not been assumed, such
amount shall be equal to the fair market value of the property subject to such
Lien), (v) all Capitalized Lease Obligations of such Person, (vi) all
obligations of such Person to pay a specified purchase price for goods or
services whether or not delivered or accepted, i.e., take-or-pay and similar
obligations, (vii) all obligations of such Person under Interest Rate Protection
Agreements and Other Hedging Agreements and (viii) all Contingent Obligations of
such Person; provided, that Indebtedness shall not include trade payables and
accrued expenses, in each case arising in the ordinary course of business.
"Indemnitee" shall have the meaning provided in Section 12.01.
"Intercompany Note" shall mean a promissory note substantially in the form
of Exhibit L.
"Interest Period" shall mean, with respect to any Eurodollar Loan, the
interest period applicable thereto, as determined pursuant to Section 1.10.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, interest
rate hedging agreement or other similar agreement or arrangement.
"Investment" shall have the meaning provided in Section 8.06.
"IPO" shall mean the initial registered public offering by Workflow of its
common stock.
"IPO Documents" shall mean the registration statement of Workflow relating
to the registration of its common stock in connection with the IPO, and all
other documents or agreements related to the consummation of the IPO, including,
without limitation, all underwriting or similar agreements and all documents
related thereto filed with the SEC.
"Judgment Currency" shall have the meaning provided in Section 12.18(a).
"Judgment Currency Conversion Date" shall have the meaning provided in
Section 12.18(a).
"Leasehold" of any Person shall mean all of the right, title and interest
of such Person as lessee or licensee in, to and under leases or licenses of
land, improvements and/or fixtures.
"Lender" shall mean each lender listed on Annex I-A, as well as each Person
which becomes a "Lender" hereunder pursuant to Section 1.14 or 12.04(b). Unless
the context otherwise requires, each reference in this Agreement to a Lender
includes each Canadian Lender
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and shall include references to any Affiliate of any such Lender which is acting
as a Canadian Lender.
"Lender Default" shall mean (i) the refusal (which has not been retracted)
of a Lender to make available its portion of any incurrence of Loans or to fund
its portion of any unreimbursed payment under Section 2.04(c) or (ii) a Lender
having notified the Agent and/or the Borrower that it does not intend to comply
with the obligations under Section 1.01 or under Section 2.04(c).
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in Section 3.01(b).
"Letter of Credit Issuer" shall mean BTCo.
"Letter of Credit Outstandings" shall mean, at any time, the sum of,
without duplication, (i) the aggregate Stated Amount of all outstanding Letters
of Credit and (ii) the aggregate amount of all Unpaid Drawings in respect of all
Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in Section
2.02(a).
"Leverage Ratio" shall mean, as at any date with respect to any Person, the
ratio of Total Indebtedness at such date to Consolidated EBITDA for the Test
Period then last ended (including on such date), in each case of such Person; it
being understood and agreed that for any determination of the Leverage Ratio of
Workflow on or prior to April 24, 1999, Consolidated EBITDA of Workflow for the
fiscal quarter ended (i) July 26, 1997 shall be $7,489,000, (ii) October 25,
1997 shall be $7,270,000, (iii) January 24, 1998 shall be $6,727,000 and (iv)
April 29, 1998 shall be $7,162,000 (which amount represents the average
Consolidated EBITDA for the prior 3 fiscal quarters), provided that Consolidated
EBITDA for the fiscal quarter ended closest to April 30, 1998 shall be restated
once the financial results for such fiscal quarter are available and reported to
the Agent.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
encumbrance, lien (statutory or otherwise) preference, priority, charge or other
security arrangement of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any similar
recording or notice statute, and any lease having substantially the same effect
as the foregoing).
"Loan" shall mean each Revolving Loan, each Swingline Loan and each
Competitive Bid Loan.
"Management Agreements" shall have the meaning provided in Section
5.15(iv).
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(c)(C).
"Margin Stock" shall have the meaning provided in Regulation U.
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"Material Adverse Effect" shall mean a material adverse effect on (i) the
business, assets, properties, operations, condition (financial or otherwise),
liabilities or prospects of any Borrower or any Borrower and its Subsidiaries
taken as a whole, (ii) the rights or remedies of the Lenders under the Credit
Documents or (iii) the ability of any Borrower or any other Credit Party to
perform its respective obligations to the Lenders under the Credit Documents .
"Material Real Property" shall mean any Real Property owned by Workflow or
any Subsidiary Guarantor having a fair market value of $500,000 or more.
"Material Subsidiary" shall mean and include (x) each Subsidiary of
Workflow which owns any capital stock of another Subsidiary of Workflow, (y)
each Subsidiary of Workflow which owns a Material Real Property and (z) any
other Subsidiary of Workflow having total assets the value of which equals or
exceeds $3,000,000 at any time.
"Maximum Swingline Amount" shall mean $5,000,000.
"Minimum Borrowing Amount" shall mean (i) for Revolving Loans that are
maintained as Base Rate Loans, $1,000,000; (ii) for Revolving Loans that are
maintained as Eurodollar Loans, $2,500,000; (iii) for Swingline Loans, $250,000;
(iv) for Revolving Loans that are maintained as Canadian Prime Rate Loans, Cdn
$1,000,000; (v) in the case of Bankers' Acceptance Loans, the amount specified
in Annex III; and (vi) in the case of Competitive Bid Loans, $5,000,000.
"Mortgage" shall mean each mortgage, deed to secure debt, debenture,
hypothec, deed of trust or similar agreement pursuant to which any Credit Party
shall have granted to the Collateral Agent a mortgage lien on such Credit
Party's Mortgaged Property.
"Mortgage Policies" shall have the meaning provided in Section 5.12 (ii).
"Mortgaged Property" shall mean each parcel of Real Property owned or
leased by any Credit Party which is encumbered by a Mortgage.
"Net Cash Proceeds" shall mean, with respect to any Asset Sale, the Cash
Proceeds resulting therefrom net of expenses of sale (including payment of
principal, premium and interest of other Indebtedness secured by the assets the
subject of such Asset Sale and required to be, and which is, repaid under the
terms thereof as a result of such Asset Sale), and incremental taxes paid or
payable as a result thereof.
"Net Insurance Proceeds" shall mean, with respect to any Recovery Event,
the Cash Proceeds (net of reasonable costs and taxes incurred in connection with
such Recovery Event) received in connection with the respective Recovery Event.
"Non-Defaulting Lender" shall mean each Lender other than a Defaulting
Lender.
"Note" shall mean each Dollar Revolving Note, each Canadian Revolving Note,
the Swingline Note and each Competitive Bid Note.
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"Notice of Borrowing" shall have the meaning provided in Section 1.03(a).
"Notice of Competitive Bid Borrowing" shall have the meaning provided in
Section 1.04(a).
"Notice of Conversion" shall have the meaning provided in Section 1.07.
"Notice Office" shall mean the office of the Agent located at 130 Liberty
Street, Commercial Loan Division, 14th Floor, New York, New York 10006,
Attention: Chris DiBiase, provided that with respect to Notices of Borrowing for
Canadian Prime Rate Loans and Bankers' Acceptance Loans, a copy thereof also
shall be sent by DBF to BT Bank of Canada, Royal Bank Plaza, North Tower, Suite
1700, Toronto, Ontario, Canada M5J2J2, Attention: _________, or such other
office as the Agent may designate to the Borrowers and the Lenders from time to
time.
"Obligation Currency" shall have the meaning provided in Section 12.18(a).
"Obligations" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing to the
Agent, the Collateral Agent, the Letter of Credit Issuer or any Lender pursuant
to the terms of this Agreement or any other Credit Document.
"Other Hedging Agreement" shall mean any foreign exchange contracts,
currency swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuation in currency values.
"Participant" shall have the meaning provided in Section 2.04(a).
"Payment Office" shall mean (i) in respect of Dollar Loans, incurred by
Workflow, Letters of Credit, Fees and, except as provided in clause (ii) below,
all other amounts owing under this Agreement and the other Credit Documents, the
office of the Agent located at 130 Liberty Street, 14th Floor, Commercial Loan
Division New York, New York 10006, ABA Number: 021001033, Credit to Commercial
Loan Division, Reference: Workflow Management, Account Number: 99401268, and
(ii) in respect of Canadian Revolving Loans incurred by DBF, to [ ____________,
Account Number: ________, Account Name: __________, Reference: ______________
or in each case such other office as the Agent may hereafter designate in
writing as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" of any Lender at any time shall mean a fraction (expressed as
a percentage) the numerator of which is the Commitment of such Lender at such
time and the denominator of which is the Total Commitment at such time.
Notwithstanding anything to the contrary contained above, if the Percentage of
any Lender is to be determined after the Total
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Commitment has been terminated, then the Percentages of the Lenders shall be
determined immediately prior (and without giving effect) to such termination.
"Permitted Acquisition" shall have the meaning provided in Section 8.02(f).
"Permitted Encumbrance" shall mean, with respect to any Mortgaged Property,
such exceptions to title as are set forth in the Mortgage Policy delivered with
respect thereto, all of which exceptions must be acceptable, on the date of
delivery of such Mortgage Policy, to the Agent.
"Permitted Liens" shall have the meaning provided in Section 8.03.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" shall mean any pension plan as defined in Section 3(2) of ERISA,
which is maintained or contributed to by (or to which there is an obligation to
contribute of) Workflow or a Subsidiary of Workflow or an ERISA Affiliate, and
each such plan for the five year period immediately following the latest date on
which Workflow, or a Subsidiary of Workflow or an ERISA Affiliate maintained,
contributed to or had an obligation to contribute to such plan.
"Pledge Agreement" shall mean and include each of the U.S. Pledge
Agreement, each Canadian Pledge Agreement and each other pledge agreement
required to be executed pursuant to Section 8.12.
"Pledged Securities" shall mean all the Pledged Securities as defined in
the applicable Pledge Agreement.
"Prime Lending Rate" shall mean the rate which the Agent announces from
time to time as its prime lending rate, the Prime Lending Rate to change when
and as such prime lending rate changes. The Prime Lending Rate is a reference
rate and does not necessarily represent the lowest or best rate actually charged
to any customer. The Agent may make commercial loans or other loans at rates of
interest at, above or below the Prime Lending Rate.
"PSD Interest Period" shall mean an Interest Period commenced prior to the
Syndication Date, each of which Interest Periods must satisfy the requirements
of Section 1.10(v).
"Qualified Preferred Stock" shall mean any preferred stock of Workflow so
long as the terms of any such preferred stock (i) do not provide any collateral
security, (ii) do not provide any guaranty or other support by any Subsidiary of
Workflow, (iii) do not require the cash payment of dividends, (iv) do not
contain any mandatory put, redemption, repayment, sinking fund or other similar
provision, (v) do not contain any covenants other than periodic reporting
requirements, (vi) do not grant the holders thereof any voting rights except for
(x) voting rights required to be granted to such holders under applicable law
and (y) limited
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customary voting rights on fundamental matters such as mergers, consolidations,
sales of all or substantially all of the assets of Workflow or liquidations
involving Workflow, (vii) do not provide for the conversion into, or the
exchange for (unless at the sole discretion of the issuer thereof), debt
securities and (viii) are otherwise reasonably satisfactory to the Agent.
"Real Property" of any Person shall mean all of the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by Workflow or any of its
Subsidiaries of any cash insurance proceeds or condemnation awards payable (i)
by reason of theft, loss, physical destruction, damage, taking or any other
similar event with respect to any property or assets of Workflow or any of its
Subsidiaries and (ii) under any policy of insurance required to be maintained
under Section 7.03.
"Register" shall have the meaning provided in Section 12.17.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.
"Regulation T" shall mean Regulation T of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successors to all
or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing margin requirements.
"Regulation X" shall mean Regulation X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof.
"Reinvestment Assets" shall mean (i) in the case of any Asset Sale, any
assets to be employed in, and/or the capital stock of any Person engaged in, the
business of Workflow and its Subsidiaries and (ii) in the case of any Recovery
Event, any assets purchased or constructed in replacement of the assets subject
to such Recovery Event.
"Reinvestment Election" shall have the meaning provided in Section 3.03(c).
"Reinvestment Notice" shall mean a written notice signed by the president,
any vice-president or an Authorized Financial Officer of Workflow stating that
Workflow, in good faith, intends and expects to use all or a specified portion
of (i) the Net Cash Proceeds of an Asset Sale to purchase, construct or
otherwise acquire Reinvestment Assets or (ii) the Net Insurance Proceeds of a
Recovery Event to purchase or construct Reinvestment Assets, which Reinvestment
Notice also shall set forth (in each case) in reasonable detail the approximate
amount of the transaction costs and incremental taxes incurred or payable in
connection with any such Asset Sale or Recovery Event.
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"Reinvestment Reduction Amount" shall mean, with respect to any
Reinvestment Election, the amount, if any, on the Reinvestment Reduction Date
relating thereto by which (x) the Anticipated Reinvestment Amount in respect of
such Reinvestment Election exceeds (y) the aggregate amount thereof expended by
Workflow and its Subsidiaries to acquire or construct Reinvestment Assets.
"Reinvestment Reduction Date" shall mean, with respect to any Reinvestment
Election, the earliest of (i) the date, if any, upon which a Default or an Event
of Default shall have occurred, (ii) the date occurring one year after the
making of such Reinvestment Election and (iii) the date on which Workflow or the
respective Subsidiary shall have determined not to, or shall have otherwise
ceased to, proceed with the purchase, construction or other acquisition of
Reinvestment Assets with the related Anticipated Reinvestment Amount.
"Release" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing or
migration into the environment.
"Replaced Lender" shall have the meaning provided in Section 1.14.
"Replacement Lender" shall have the meaning provided in Section 1.14.
"Reply Date" shall have the meaning provided in Section 1.04(b).
"Reportable Event" shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
.22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
"Required Lenders" shall mean Non-Defaulting Lenders the sum of whose
Commitments (or after the termination thereof, outstanding Revolving Loans,
Competitive Bid Loans and Percentages of outstanding Swingline Loans and Letter
of Credit Outstandings) represent an amount greater than 50% of the Total
Commitment less the Commitments of Defaulting Lenders (or after the termination
of the Total Commitment, the sum of the then total outstanding Revolving Loans
and Competitive Bid Loans of Non-Defaulting Lenders and the aggregate
Percentages of all Non-Defaulting Lenders in outstanding Swingline Loans and
Letter of Credit Outstandings at such time). For purposes of determining
Required Lenders, all outstanding Loans and Commitments, as the case may be,
that are denominated in Dollars will be calculated in Dollars and all Loans and
Commitments, as the case may be, denominated in Canadian Dollars will be
calculated according to the Dollar Equivalent thereof.
"Revolving Credit Exposure" shall mean, for any Lender at any time, the sum
of (i) the aggregate principal amount of all Revolving Loans made by such Lender
(and its Affiliates, if any, acting as a Canadian Lender, and, for this purpose,
(x) at all times prior to the occurrence of any Sharing Event and automatic
conversion of all Canadian Revolving Loans to Dollar Revolving Loans pursuant to
Section 1.16, using the Dollar Equivalent of the principal amount or Face
Amount, as the case may be, of all Canadian Revolving Loans then outstanding
from such Lender or any Affiliate thereof acting as a Canadian Lender and (y) at
all times after
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the occurrence of any Sharing Event, giving effect to the conversions required
by Section 1.16 and to all participations purchased by such Lender pursuant to
Section 1.16) plus (ii) the product of (A) such Lender's Dollar Percentage (or,
after the occurrence of a Sharing Event, its Percentage) and (B) the sum of (x)
the aggregate amount of all Letter of Credit Outstandings at such time and (y)
the aggregate principal amount of all Swingline Loans then outstanding.
"Revolving Loan" shall have the meaning provided in Section 1.01(a).
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto.
"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b).
"Secured Creditors" shall have the meaning assigned in the respective
Security Documents.
"Security Agreement" shall mean and include each of the U.S. Security
Agreement, each Canadian Security Agreement and each other security agreement
required to be executed pursuant to Section 8.12.
"Security Agreement Collateral" shall mean all "Collateral" as defined in
the applicable Security Agreement.
"Security Documents" shall mean and include each Security Agreement, the
Mortgages and each Pledge Agreement.
"Shareholders' Agreements" shall have the meaning provided in Section
5.15(iii).
"Sharing Event" shall mean (i) the occurrence of any Event of Default with
respect to any Borrower pursuant to Section 9.05, (ii) the declaration of the
Total Commitment terminated, or the acceleration of the maturity of any Loans,
in each case pursuant to the last paragraph of Section 9 or (iii) the failure of
any Borrower to pay any principal of, Face Amount of, or interest on, Loans or
any Letter of Credit Outstandings on the Final Maturity Date.
"Specified Subsidiaries" shall mean each Subsidiary of Workflow acquired
after the Effective Date as permitted pursuant to this Agreement, which, at the
time of the acquisition thereof, was the obligor with respect to Indebtedness
and/or the property of which was subject to Liens securing Indebtedness, in each
case, incurred other than pursuant to this Agreement and the other Credit
Documents and that will remain outstanding after giving effect to such
acquisition.
"Spinoff" shall mean the distribution of the shares of common stock of
Workflow held by U.S. Office Products to its shareholders as set forth in the
Spinoff Documents.
"Spinoff Distribution Agreement" shall mean the Agreement and Plan of
Distribution, dated as of June 9, 1989, among U.S. Office Products, Workflow,
School Specialty, Inc., Aztec Technology Partners, Inc. and Navigant
International, Inc.
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"Spinoff Documents" shall mean the Spinoff Distribution Agreement, the
Spinoff Employee Benefits Agreement, the Spinoff Registration Statement, the
Spinoff Tax Allocation Agreement and the Spinoff Tax Indemnification Agreement
and all other agreements and documents relating to the Spinoff.
"Spinoff Employee Benefits Agreement" shall mean the Employee Benefits
Agreement, dated as of June 9, 1998, among U.S. Office Products, Workflow,
School Specialty, Inc., Aztec Technology Partners, Inc. and Navigant
International, Inc.
"Spinoff Registration Statement" shall mean the Registration Statement on
Form S-1 prepared in connection with the Spinoff.
"Spinoff Tax Allocation Agreement" shall mean the Tax Allocation Agreement,
dated as of June 9, 1998, among U.S. Office Products, Workflow, School
Specialty, Inc., Aztec Technology Partners, Inc. and Navigant International,
Inc.
"Spinoff Tax Indemnification Agreement" shall mean the Tax Indemnification
Agreement, dated as of June 9, 1998, among U.S. Office Products, Workflow,
School Specialty, Inc., Aztec Technology Partners, Inc. and Navigant
International, Inc.
"Stated Amount" of each Letter of Credit shall mean the maximum amount
available to be drawn thereunder (regardless of whether any conditions for
drawing could then be met).
"Subsidiary" of any Person shall mean and include (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture, limited liability or other entity in which such Person directly or
indirectly through Subsidiaries, has more than a 50% equity interest at the
time.
"Subsidiary Guarantor" shall mean, at any time, each U.S. Subsidiary
Guarantor and each Foreign Subsidiary of Workflow required to execute and
deliver the U.S. Subsidiaries Guaranty, the Canadian Guaranty and/or any other
guaranty required to be executed pursuant to Section 8.12, as the case may be.
"Swingline Expiry Date" shall mean the date which is five Business Days
prior to the Final Maturity Date.
"Swingline Loan" shall have the meaning provided in Section 1.01(c).
"Swingline Note" shall have the meaning provided in Section 1.06(a).
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"Syndication Date" shall mean the earlier of (x) the date which is 90 days
after the Effective Date and (y) the date upon which the Agent determines in its
sole discretion (and notifies Workflow) that the primary syndication of the
Total Commitment (and the resulting addition of institutions as Lenders pursuant
to Section 12.04) has been completed.
"Taxes" shall have the meaning provided in Section 4.04.
"Tax Sharing Agreements" shall have the meaning provided in Section
5.15(iii).
"Test Period" shall mean, with respect to any Person, (i) for any
determination of the Consolidated Interest Coverage Ratio of Workflow made on or
prior to the last day of Workflow's fiscal year ending closest to April 30,
1999, the period from the Effective Date through and including the last day of
Workflow's most recently ended fiscal quarter (in each case taken as one
accounting period) and (ii) for any period thereafter and for any determination
of the Leverage Ratio of Workflow, a period of four consecutive fiscal quarters
of such Person ended on the last day of the then most recently ended fiscal
quarter of such Person.
"Total Canadian Sub-Commitment" shall mean, at any time, but otherwise
subject to the provisions of Section 1.17, the sum of the Canadian
Sub-Commitments of all Canadian Lenders at such time; provided, that in no event
shall the Total Canadian Sub-Commitment exceed at any time the lesser of (x)
$50,000,000 and (y) the Total Commitment at such time.
"Total Commitment" shall mean the sum of the Commitments of each of the
Lenders.
"Total Dollar Sub-Commitment" at any time shall mean the sum of the Dollar
Sub-Commitments of all of the Lenders at such time; provided that at no time
shall the Total Dollar Sub-Commitment exceed the Total Commitment as then in
effect.
"Total Indebtedness" shall mean, at any time with respect to any Person,
all (i) indebtedness of such Person and its Subsidiaries for borrowed money at
such time, (ii) all Indebtedness of such Person and its Subsidiaries the type
described in clauses (iii), (iv) and (v) of the definition of Indebtedness at
such time and (iii) all Contingent Obligations and its Subsidiaries in respect
of Indebtedness of the type described in preceding clauses (i) and (ii) at such
time, in each case determined on a consolidated basis.
"Transaction" shall mean and include (i) the Spinoff and (ii) the entering
into of this Agreement and the other Credit Documents.
"Type" shall mean the type of Loan determined with respect to the interest
option applicable thereto, i.e., whether a Base Rate Loan, a Canadian Prime Rate
Loan, a Eurodollar Loan or a Bankers' Acceptance Loan.
"UCC" shall mean the Uniform Commercial Code as in effect from time to time
in the relevant jurisdiction.
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"Unfunded Current Liability" of any Plan shall mean the amount, if any, by
which the actuarial present value of the accumulated plan benefits under the
Plan, determined on a plan termination basis in accordance with actuarial
assumptions at such time consistent with those prescribed by the PBGC for
purposes of Section 4044 of ERISA, exceeds the fair market value of all plan
assets allocable to such liabilities under Title IV of ERISA (excluding accrued
but unpaid contributions).
"Unpaid Drawing" shall have the meaning provided in Section 2.03(a).
"Unutilized Acquisition Sub-Limit" shall mean, at any time, (i) the
Acquisition Sub-Limit at such time less (ii) the sum of the aggregate
outstanding principal amount of all Acquisition Loans at such time.
"Unutilized Commitment" with respect to any Lender, at any time, shall mean
an amount equal to the remainder of (x) the Commitment of such Lender at such
time less (y) the sum of (I) the aggregate principal amount of all Revolving
Loans made by such Lender (including any Affiliate of any such Lender acting as
a Canadian Lender) and then outstanding (taking the Dollar Equivalent of the
principal amount or Face Amount, as the case may be, in the case of Canadian
Revolving Loans then outstanding) plus (II) such Lender's Dollar Percentage (or,
after a Sharing Event has occurred, its Percentage) of the Letter of Credit
Outstandings at such time plus (III) the product of (A) the aggregate principal
amount of all Competitive Bid Loans made by such Lender and then outstanding and
(B) such Lender's Dollar Percentage (or, after a Sharing Event has occurred, its
Percentage) of the Total Commitment.
"Unutilized Total Commitment" shall mean, at any time, an amount equal to
the remainder of (x) the Total Commitment at such time less (y) the sum of (I)
the aggregate outstanding principal amount or Face Amount, as the case may be,
of all Revolving Loans at such time (for this purpose, taking the Dollar
Equivalent thereof in the case of Canadian Revolving Loans then outstanding)
plus (II) the aggregate principal amount of all Swingline Loans then outstanding
plus (III) the then aggregate amount of all Letter of Credit Outstandings plus
(IV) the aggregate principal amount of all Competitive Bid Loans then
outstanding.
"U.S. Credit Party" shall mean and include Workflow and each U.S.
Subsidiary Guarantor.
"U.S. Office Products" shall mean U.S. Office Products Company, a Delaware
corporation.
"U.S. Pledge Agreement" shall have the meaning provided in Section 5.11(a).
"U.S. Security Agreement" shall have the meaning provided in Section
5.11(c).
"U.S. Subsidiary Guarantor" shall mean each Domestic Subsidiary of
Workflow.
"U.S. Subsidiaries Guaranty" shall have the meaning provided in Section
5.10(a).
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"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any corporation
100% of whose capital stock (other than directors qualifying shares) is at the
time owned by such Person and/or one or more Wholly-Owned Subsidiaries of such
Person and (ii) any partnership, association, joint venture or other entity in
which such Person and/or one or more Wholly-Owned Subsidiaries of such Person
has a 100% equity interest at such time.
"Workflow" shall have the meaning provided in the first paragraph of this
Agreement.
"Working Capital Loan" shall mean each Loan incurred by any Borrower
hereunder which does not constitute an Acquisition Loan.
"Written" or "in writing" shall mean any form of written communication or a
communication by means of telex, facsimile device, telegraph or cable.
SECTION 11. The Agent.
11.01 Appointment. Each Lender hereby irrevocably designates and appoints
BTCo as Agent of such Lender (such term to include for purposes of this Section
11, BTCo acting as Collateral Agent) to act as specified herein and in the other
Credit Documents, and each such Lender hereby irrevocably authorizes BTCo as the
Agent to take such action on its behalf under the provisions of this Agreement
and the other Credit 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 Credit Documents, together with such other powers as are
reasonably incidental thereto. The Agent agrees to act as such upon the express
conditions contained in this Section 11. Notwithstanding any provision to the
contrary elsewhere in this Agreement or in any other Credit Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein or in the other Credit Documents, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against the Agent. The provisions of this Section 11 are solely for the benefit
of the Agent and the Lenders, and neither the Borrowers nor any of their
respective Subsidiaries shall have any rights as a third party beneficiary of
any of the provisions hereof. In performing its functions and duties under this
Agreement, the Agent shall act solely as agent of the Lenders and the Agent does
not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for any Borrower or any of their
respective Subsidiaries.
11.02 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Credit Document (including any Security Document) by
or through agents, sub-collateral agents or attorneys-in-fact (each of whom
shall be entitled to the benefits of this Section 11 to the same extent as the
Agent) 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, sub-collateral agents or attorneys-in-fact selected
by it with reasonable care.
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11.03 Exculpatory Provisions. Neither the Agent nor any of its officers,
directors, employees, agents, sub-collateral 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 the
other Credit Documents (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrowers,
any of their respective Subsidiaries or any of their respective officers
contained in this Agreement or the other Credit Documents 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 Credit
Document or for any failure of any Borrower or any of their respective
Subsidiaries or any of their respective officers 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 the other
Credit Documents, or to inspect the properties, books or records of the
Borrowers or any of their respective Subsidiaries. The Agent shall not be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any other
Credit Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statement or in any
financial or other statements, instruments, reports, certificates or any other
documents in connection herewith or therewith furnished or made by the Agent to
the Lenders or by or on behalf of the Borrowers or any of their respective
Subsidiaries to the Agent or any Lender or be required to ascertain or inquire
as to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or of the existence or possible existence of any Default
or Event of Default.
11.04 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, cablegram, telegram, facsimile, 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 Borrowers or any of their respective
Subsidiaries), independent accountants and other experts selected by the Agent.
The Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Credit 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 Credit 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.
11.05 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 actually received notice from a Lender or any Borrower referring to
this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event
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that the Agent receives such a notice, the Agent shall give prompt 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.
11.06 Non-Reliance on Agent and other Lenders. Each Lender expressly
acknowledges that neither the Agent nor any of its respective officers,
directors, employees, agents, sub-collateral agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
the Agent hereinafter taken, including any review of the affairs of the
Borrowers or any of their respective Subsidiaries, 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 appraisal of and investigation into the
business, assets, operations, property, financial and other condition, prospects
and creditworthiness of the Borrowers and their respective Subsidiaries and made
its own decision to make its Loans hereunder and 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 to make such investigation as it deems necessary to inform itself as to the
business, assets, operations, property, financial and other condition, prospects
and creditworthiness of the Borrowers and their respective Subsidiaries. The
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, operations, assets,
property, financial and other condition, prospects or creditworthiness of any
Borrower or any of their respective Subsidiaries which may come into the
possession of the Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
11.07 Indemnification. The Lenders agree to indemnify the Agent in its
capacity as such ratably according to their respective "percentages" as used in
determining the Required Lenders at such time, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may at
any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, incurred by or asserted against the Agent in its
capacity as such in any way relating to or arising out of this Agreement or any
other Credit Document, or any documents contemplated by or referred to herein or
the transactions contemplated hereby or any action taken or omitted to be taken
by the Agent under or in connection with any of the foregoing, but only to the
extent that any of the foregoing is not paid by the Borrowers or any of their
respective Subsidiaries; provided, that no Lender shall be liable to the Agent
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the gross negligence or willful misconduct of the Agent
(as finally determined by a court of competent jurisdiction). To the extent any
Lender would be required to indemnify the Agent pursuant to the immediately
preceding sentence but for the fact that it is a Defaulting Lender, such
Defaulting Lender shall not be
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entitled to receive any portion of any payment or other distribution hereunder
until each other Lender shall have been reimbursed for the excess, if any, of
the aggregate amount paid by such Lender under this Section 11.07 over the
aggregate amount such Lender would have been obligated to pay had such first
Lender not been a Defaulting Lender. If any indemnity furnished to the Agent for
any purpose shall, in the opinion of the Agent be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished. The agreements in this Section 11.07 shall survive the payment of all
Obligations.
11.08 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 any Borrower and any of their respective Subsidiaries and Affiliates as
though the Agent were not the Agent hereunder. With respect to the Loans made by
it and all Obligations owing to it, the Agent shall have the same rights and
powers under this Agreement 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.
11.09 Holders. The Agent may deem and treat the payee of any Note as the
owner thereof for all purposes hereof unless and until a written notice of the
assignment, transfer or endorsement thereof, as the case may be, shall have been
filed with the Agent. Any request, authority or consent of any Person or entity
who, at the time of making such request or giving such authority or consent, is
the holder of any Note shall be conclusive and binding on any subsequent holder,
transferee, assignee or indorsee, as the case may be, of such Note or of any
Note or Notes issued in exchange therefor.
11.10 Resignation of the Agent; Successor Agent. (a) The Agent may resign
from the performance of all its respective functions and duties hereunder and/or
under the other Credit Documents at any time by giving 15 Business Days' prior
written notice to the Lenders. Such resignation shall take effect upon the
appointment of a successor Agent pursuant to clauses (b) and (c) below or as
otherwise provided below.
(b) Upon any such notice of resignation by the Agent, the Required Lenders
shall appoint a successor Agent hereunder or thereunder who shall be a
commercial bank or trust company reasonably acceptable to Workflow.
(c) If a successor Agent shall not have been so appointed within such 15
Business Day period, the Agent with the consent of Workflow (which consent shall
not be unreasonably withheld or delayed), shall then appoint a successor Agent
who shall serve a successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to clause (b) or (c)
above by the 20th Business Day after the date such notice of resignation was
given by the Agent, the Required Lenders shall thereafter perform all the duties
of the Agent hereunder and/or under any other Credit Document until such time,
if any, as the Required Lenders appoint a successor Agent as provided above.
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SECTION 12. Miscellaneous.
12.01 Payment of Expenses, etc. The Borrowers jointly and severally agree
to: (i) whether or not the transactions herein contemplated are consummated, pay
all reasonable out-of-pocket costs and expenses of the Agent (including, without
limitation, the reasonable fees and disbursements of White & Case LLP,
Stikemann, Elliott and local counsel) in connection with the negotiation,
preparation, execution and delivery of the Credit Documents and the documents
and instruments referred to therein and any amendment, waiver or consent
relating thereto and in connection with the Agent's syndication efforts with
respect to this Agreement; (ii) pay all reasonable out-of-pocket costs and
expenses of the Agent and each of the Lenders in connection with the enforcement
of the Credit Documents and the documents and instruments referred to therein
and, after an Event of Default shall have occurred and be continuing, the
protection of the rights of the Agent and each of the Lenders thereunder,
including in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a "work-out" or
pursuant to any insolvency or bankruptcy proceedings (including, without
limitation, in each case the reasonable fees and disbursements of counsel
(including in-house counsel) for the Agent and for each of the Lenders); (iii)
pay and hold each of the Lenders harmless from and against any and all present
and future stamp and other similar taxes with respect to the foregoing matters
and save each of the Lenders harmless from and against any and all liabilities
with respect to or resulting from any delay or omission (other than to the
extent attributable to such Lender) to pay such taxes; and (iv) indemnify the
Agent, the Collateral Agent and each Lender, its officers, directors, employees,
representatives, agents and sub-collateral agents (each an "Indemnitee") from
and hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of (a) any investigation (other than
those undertaken pursuant to Section 7.02), litigation or other proceeding
(whether or not the Agent, the Collateral Agent or any Lender is a party
thereto) related to the entering into and/or performance of this Agreement or
any other Credit Document or the use of the proceeds of any Loans hereunder or
the consummation of any other transactions contemplated in any Credit Document,
or (b) the actual or alleged presence of Hazardous Materials in the air, surface
water or groundwater or on the surface or subsurface of any Real Property owned,
leased or at any time operated by any Borrower or any of their respective
Subsidiaries, the Release, generation, storage, transportation, handling or
disposal of Hazardous Materials at any location, whether or not owned, leased or
operated by such Borrower or any of its Subsidiaries, the non-compliance by any
Borrower or any of their respective Subsidiaries of any Real Property with
foreign, federal, state and local laws, regulations, ordinances or Environmental
Laws (including applicable permits thereunder) applicable to any Real Property,
or any Environmental Claim relating to any Borrower or any of their respective
Subsidiaries or any Real Property owned, leased or at any time operated by any
Borrower or any of their respective Subsidiaries, including, in each case,
without limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding (but
excluding any such losses, liabilities, claims, damages or expenses to the
extent incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified (as finally determined by the court of competent
jurisdiction). To the extent that the undertaking to indemnify, pay or hold
harmless any Person set forth in the preceding sentence may be unenforceable
because it is violative of any law or public policy, the
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Borrowers shall make the maximum contribution to the payment and satisfaction of
each of the indemnified liabilities which is permissible under applicable law.
12.02 Right of Setoff. In addition to any rights now or hereafter granted
under applicable law or otherwise, and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default,
each Lender is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to any Borrower or any
of their Subsidiaries or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply any and all deposits
(general or special) and any other Indebtedness at any time held or owing by
such Lender (including, without limitation, by branches, agencies and affiliates
of such Lender wherever located) to or for the credit or the account of any
Borrower or any Subsidiary Guarantor against and on account of the Obligations
and liabilities of any Borrower or any Subsidiary Guarantor to such Lender under
this Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations of the Borrowers or any of their
Subsidiaries purchased by such Lender pursuant to Section 12.06(b), and all
other claims of any nature or description arising out of or connected with this
Agreement or any other Credit Document, irrespective of whether or not such
Lender shall have made any demand hereunder and although said Obligations,
liabilities or claims, or any of them, shall be contingent or unmatured.
12.03 Notices. Except as otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
telegraphic, telex, facsimile or cable communication) and mailed, telegraphed,
telexed, telecopied, cabled or delivered, if to any Credit Party, at the address
specified opposite its signature below or in the other relevant Credit
Documents, as the case may be; if to any Lender, at its address specified for
such Lender on Annex II; or, at such other address as shall be designated by any
party in a written notice to the other parties hereto. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied, or cabled
or sent by overnight courier, be effective (x) three Business Days after
deposited in the mails, (y) one Business Day after delivered to the telegraph
company, cable company or a recognized overnight courier, as the case may be, or
(z) when sent by telex or telecopier, except that notices and communications to
the Agent shall not be effective until received by the Agent.
12.04 Benefit of Agreement. (a) This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided, that no Borrower may assign or transfer
any of its rights or obligations hereunder without the prior written consent of
the Lenders and, provided further, that, although any Lender may transfer,
assign or grant participations in its rights hereunder, such Lender shall remain
a "Lender" for all purposes hereunder and the transferee, assignee or
participant, as the case may be, shall not constitute a "Lender" hereunder and,
provided further, that no Lender shall transfer or grant any participation under
which the participant shall have rights to approve any amendment to or waiver of
this Agreement or any other Credit Document except to the extent such amendment
or waiver would (i) extend the final scheduled maturity of any Loan or Letter of
Credit (unless such Letter of Credit is not extended beyond the Final Maturity
Date) in which such participant is participating, or reduce the rate or extend
the time of payment of interest or
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Fees (except in connection with a waiver of applicability of any post-default
increase in interest rates) or reduce the principal amount thereof (it being
understood that any amendment or modification to the financial definitions in
this Agreement or to Section 12.07(a) shall not constitute a reduction in the
rate of interest or Fees for the purposes of this clause (i)), or increase the
amount of the participant's participation over the amount thereof then in effect
(it being understood that a waiver of any Default or Event of Default or of a
mandatory reduction in the Total Commitment shall not constitute a change in the
terms of such participation, and that an increase in any Commitment or Loan
shall be permitted without the consent of any participant if the participant's
participation is not increased as a result thereof), (ii) consent to the
assignment or transfer by any Borrower of any of its rights and obligations
under this Agreement to the extent relating to such participation or (iii)
release all or substantially all of the Collateral under all of the Security
Documents (except as expressly provided in the Credit Documents). In the case of
any such participation, the participant shall not have any rights under this
Agreement or any of the other Credit Documents (the participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto)
and all amounts payable by the Borrowers hereunder shall be determined as if
such Lender had not sold such participation.
(b) Notwithstanding the foregoing, any Lender may (x) assign all or a
portion of its Commitment (and related outstanding Obligations hereunder) to any
Affiliate of such Lender or to one or more Lenders or (y) assign all, or if less
than all, a portion equal to at least $5,000,000 in the aggregate for the
assigning Lender, of its Commitment (and related outstanding Obligations
hereunder) to one or more Eligible Transferees, provided that (i) the assignment
by any Lender of its Canadian Sub-Commitment (or any portion thereof) shall
constitute the assignment of a like amount of such Lender's (or its respective
Affiliate's) Commitment, (ii) any assignment of all or any portion of the
Commitment of any Lender shall be required to be accompanied by the assignment
of all or such portions of the Canadian Sub-Commitment and/or Dollar
Sub-Commitment of such Lender (or its respective Affiliate) as is equal, in the
aggregate, to the amount of the Commitment being so assigned, (iii) any
assignment of all or any portion of the Commitment and related outstanding
Obligations shall be made on a basis such that the respective assignee
participates in Revolving Loans and in Letter of Credit Outstandings, in
accordance with the Commitment (and Canadian Sub-Commitment described above) so
assigned, (iv) at such time Annexes I-A and I-B shall be deemed modified to
reflect the Commitments and, if applicable, Canadian Sub-Commitments of such new
Lender and of the existing Lenders, (v) upon surrender of the old Notes (if
any), new Notes will be issued, at the Borrower's expense, to such new Lender
and to the assigning Lender upon the request of such new Lender and such new
Notes to be in conformity with the requirements of Section 1.06 to the extent
needed to reflect the revised Commitments, (vi) the consent of Workflow (so long
as no Default or Event of Default then exists) and the Agent shall be required
in connection with any such assignment pursuant to clause (y) above (each of
which consents shall not be unreasonably withheld or delayed), (vii) the Agent
shall receive at the time of each such assignment, from the assigning or
assignee Lender, the payment of a non-refundable assignment fee of $3,500 and
(viii) no assignment shall be effective until recorded by the Agent on the
Register pursuant to Section 12.17. If any Lender so sells or assigns all or a
part of its rights hereunder or under the Notes, any reference in this Agreement
or the Notes to such assigning Lender shall thereafter
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refer to such Lender and to the respective assignee to the extent of their
respective interests and the respective assignee shall have, to the extent of
such assignment (unless otherwise provided therein), the same rights and
benefits as it would if it were such assigning Lender. Each assignment pursuant
to this Section 12.04(b) shall be effected by the assigning Lender and the
assignee Lender executing an Assignment and Assumption Agreement substantially
in the form of Exhibit K, appropriately completed (each, an "Assignment and
Assumption Agreement"). To the extent of any assignment pursuant to this Section
12.04(b), the assigning Lender shall be relieved of its obligations hereunder
with respect to its assigned Commitment. At the time of each assignment pursuant
to this Section 12.04(b) to a Person which is not already a Lender hereunder and
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Lender shall, to the extent legally entitled to do so, provide to
Workflow the appropriate Internal Revenue Service Forms (and, if applicable, a
Section 4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent
that an assignment of all or any portion of a Lender's Commitments and related
outstanding Obligations pursuant to Section 1.14 or this Section 12.04(b) would,
at the time of such assignment, result in increased costs under Sections 1.11,
2.05 or 4.04 from those being charged by the respective assigning Lender prior
to such assignment, then Workflow shall not be obligated to pay such increased
costs (although Workflow, in accordance with and pursuant to the other
provisions of this Agreement, shall be obligated to pay any other increased
costs of the type described above resulting from changes after the date of the
respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit any Lender from
pledging its Loans and Notes hereunder to a Federal Reserve Lender in support of
borrowings made by such Lender from such Federal Reserve Lender.
12.05 No Waiver; Remedies Cumulative. No failure or delay on the part of
the Agent, the Collateral Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between any Credit Party and the Agent, the Collateral Agent or any Lender shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies herein expressly
provided are cumulative and not exclusive of any rights or remedies which the
Agent, the Collateral Agent or any Lender would otherwise have. No notice to or
demand on any Credit Party in any case shall entitle any Credit Party to any
other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Agent, the Collateral Agent or the
Lenders to any other or further action in any circumstances without notice or
demand.
12.06 Payments Pro Rata. (a) The Agent agrees that promptly after its
receipt of each payment from or on behalf of any Credit Party in respect of any
Obligations of such Credit Party, it shall, except as otherwise provided in this
Agreement, distribute such payment to the Lenders (other than any Lender that
has consented in writing to waive its pro rata share of such payment) pro rata
based upon their respective shares, if any, of the Obligations with respect to
which such payment was received.
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(b) Except to the extent that this Agreement provides for payments to be
allocated to the Lenders with particular Obligations, prior to the occurrence of
a Sharing Event, if any Lender (a "Benefitted Lender") shall at any time receive
any payment of all or part of its Loans or the other Obligations owing to it, 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 9.05, pursuant to any Security Document 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
the other Obligations owing to such other Lender, or interest thereon, such
Benefitted Lenders shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loans and/or
other Obligations owning to each such other Lenders, or shall provide such other
Lenders with the benefits of any such collateral, or the proceeds thereof, as
shall be necessary to cause such Benefitted 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 Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
12.07 Calculations; Computations. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by Workflow to the Lenders); provided, that (i) for purposes of determining
compliance with any incurrence tests set forth in Section 8 (excluding Sections
8.09 and 8.10), any amounts so incurred or expended (to the extent incurred or
expended in a currency other than Dollars) shall be converted into Dollars on
the basis of the Dollar Equivalent of the respective amounts as in effect on the
date of such incurrence or expenditure under any provision of any such Section
that has an aggregate Dollar limitation provided for therein (and to the extent
the respective incurrence test regulates the aggregate amount outstanding at any
time and it is expressed in terms of Dollars, all outstanding amounts originally
incurred or spent in currencies other than Dollars shall be converted into
Dollars on the basis of the Dollar Equivalent of the respective amounts as in
effect on the date any new incurrence or expenditures made under any provision
of any such Section that regulates the Dollar amount outstanding at any time)
and (ii) except as otherwise specifically provided herein, all computations
determining compliance with Section 8, including definitions used therein, shall
utilize accounting principles and policies in effect at the time of the
preparation of, and in conformity with those used to prepare, the year end
financial statements delivered to the Lenders pursuant to Section 6.10(b).
(b) All computations of interest on Base Rate Loans, Canadian Prime Rate
Loans, Eurodollar Loans and Fees (including Letter of Credit Fees and Facing
Fees, but excluding Acceptance Fees) hereunder shall be made on the basis of the
actual number of days elapsed over a year of 360 days. Acceptance Fees shall be
calculated on the basis of the term of maturity of the Bankers' Acceptance and a
year of 365 days.
(c) For purposes of the Interest Act (Canada), (i) whenever any interest or
fee under this Agreement is calculated using a rate based on a year of 360 or
365 days, as the case may be, the rate determined pursuant to such calculation,
when expressed as an annual rate, is
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equivalent to (x) the applicable rate based on a year of 360 or 365 days, as the
case may be, (y) multiplied by the actual number of days in the calendar year in
which the period for which such interest or fee is payable (or compounded) ends,
and (z) divided by 360 or 365, as the case may be, (ii) the principle of deemed
reinvestment of interest does not apply to any interest calculation under this
Agreement, and (iii) the rates of interest stipulated in this Agreement are
intended to be nominal rates and not effective rates or yields.
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE. (A) THIS AGREEMENT
AND THE OTHER CREDIT DOCUMENTS (EXCEPT, IN THE CASE OF CERTAIN OF THE SECURITY
DOCUMENTS AND THE CANADIAN PARENT GUARANTY, AS SPECIFICALLY OTHERWISE PROVIDED
THEREIN) AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF
NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR
OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH BORROWER HEREBY IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS. EACH BORROWER HEREBY FURTHER IRREVOCABLY
WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER IT, AND
AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE
AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER IT. EACH
BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH BORROWER, AT
ITS ADDRESS FOR NOTICES PURSUANT TO SECTION 12.03, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING. EACH BORROWER HEREBY IRREVOCABLY WAIVES
ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND
AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR
UNDER ANY OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID
OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT, ANY LENDER
OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN
ANY OTHER JURISDICTION.
(B) EACH BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE
AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN THE
FIRST SENTENCE OF CLAUSE (A) ABOVE
108
AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
12.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A complete set of
counterparts executed by all the parties hereto shall be lodged with each
Borrower and the Agent.
12.10 Effectiveness. This Agreement shall become effective on the date (the
"Effective Date") on which (i) the Borrowers, the Agent and each of the Lenders
shall have signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered the same to the Agent at the Notice
Office or, in the case of the Lenders, shall have given to the Agent telephonic
(confirmed in writing), written or telex notice (actually received) at such
office that the same has been signed and mailed to it and (ii) the conditions
set forth in Section 5 are met to the satisfaction of the Agent and the Required
Lenders. Unless the Agent has received actual notice from any Lender that the
conditions contained in Section 5 have not been met to its satisfaction, upon
the satisfaction of the condition described in clause (i) of the immediately
preceding sentence and upon the Agent's good faith determination that the
conditions described in clause (ii) of the immediately preceding sentence have
been met, then the Effective Date shall have been deemed to have occurred,
regardless of any subsequent determination that one or more of the conditions
thereto had not been met. The Agent will give each Borrower and each Lender
prompt written notice of the occurrence of the Effective Date.
12.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
12.12 Amendment or Waiver. (a) Neither this Agreement nor any other Credit
Document nor any terms hereof or thereof may be changed, waived, discharged or
terminated unless such change, waiver, discharge or termination is in writing
signed by the Required Lenders and the Borrowers; provided, that no such change,
waiver, discharge or termination shall, without the consent of each Lender
(other than a Defaulting Lender) being directly affected thereby, (i) extend the
final scheduled maturity of any Loan or Note or extend the stated expiration
date of any Letter of Credit beyond the Final Maturity Date, or reduce the rate
or extend the time of payment of interest thereon (other than as a result of
waiving the applicability of any post-default increase in interest rates) or
Fees, or reduce the principal amount thereof (it being understood that any
amendment or modification to the financial definitions in this Agreement or to
Section 12.07(a) shall not constitute a reduction in the rate of interest or
Fees for the purposes of this clause (i)), (ii) release all or substantially all
of the Collateral (except as expressly provided in the Credit Documents) under
all of the Security Documents, or release any Guarantor from its obligations
under any Guaranty to which it is a party (except (in each case) as expressly
provided in the Credit Documents), (iii) amend, modify or waive any provision of
this
109
Section 12.12 to the extent that any such amendment, modification or waiver
would alter any of the voting provisions set forth in the other provisions of
this Section 12.12, (iv) reduce the percentage specified in the definition of
Required Lenders (it being understood that, with the consent of the Required
Lenders, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Lenders on substantially the same
basis as the extensions of Commitments are included on the Effective Date) or
(v) consent to the assignment or transfer by any Borrower of any of its rights
and obligations under this Agreement or any other Credit Document except in
accordance with the terms hereof or thereof; provided further, that no such
change, waiver, discharge or termination shall (w) increase the Commitment (or
Canadian Sub-Commitment) of any Lender over the amount thereof then in effect
without the consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the Total Commitment shall not constitute an
increase of the Commitment (or Canadian Sub-Commitment) of any Lender, and that
an increase in the available portion of any Commitment (or Canadian
Sub-Commitment) of any Lender shall not constitute an increase in the Commitment
(or Canadian Sub-Commitment) of such Lender), (x) without the consent of the
Letter of Credit Issuer, amend, modify or waive any provision of Section 2 or
alter its rights or obligations with respect to Letters of Credit, (y) without
the consent of BTCo, amend or modify the obligation of BTCo to make Swingline
Loans, the terms of any such Swingline Loans or the obligations of the Lenders
to fund Mandatory Borrowings, or (z) without the consent of the Agent, amend,
modify or waive any provision of Section 11 as same applies to the Agent or any
other provision as same relates to the rights or obligations of the Agent.
(b) If, in connection with any proposed change, waiver, discharge or
termination with respect to any of the provisions of this Agreement as
contemplated by clauses (i) through (v), inclusive, of the first proviso to
Section 12.12(a), the consent of the Required Lenders is obtained but the
consent of one or more of such other Lenders whose consent is required is not
obtained, then Workflow shall have the right, to replace each such
non-consenting Lender or Lenders (so long as all non-consenting Lenders are so
replaced) with one or more Replacement Lenders pursuant to Section 1.14 so long
as at the time of such replacement, each such Replacement Lender consents to the
proposed change, waiver, discharge or termination, provided that Workflow shall
not have the right to replace a Lender solely as a result of the exercise of
such Lender's rights (and the withholding of any required consent by such
Lender) pursuant to the second proviso to Section 12.12(a).
12.13 Survival. All indemnities set forth herein including, without
limitation, in Section 1.11, 1.12, 2.05, 4.04, 11.07 or 12.01, shall survive the
execution and delivery of this Agreement and the making and repayment of the
Loans.
12.14 Domicile of Loans. Each Lender may transfer and carry its Loans at,
to or for the account of any branch office, Subsidiary or Affiliate of such
Lender provided that no Borrower shall be responsible for costs arising under
Section 1.11, 2.05 or 4.04 resulting from any such transfer (other than a
transfer pursuant to Section 1.13) to the extent such costs would not otherwise
be applicable to such Lender in the absence of such transfer.
110
12.15 Confidentiality. (a) Each of the Lenders agrees that it will use its
best efforts not to disclose without the prior consent of Workflow (other than
to its employees, auditors, counsel or other professional advisors, to
affiliates or to another Lender if the Lender or such Lender's holding or parent
company in its sole discretion determines that any such party should have access
to such information) any information with respect to Workflow or any of its
Subsidiaries which is furnished pursuant to this Agreement and which is
designated by Workflow to the Lenders in writing as confidential provided that
any Lender may disclose any such information (a) as has become generally
available to the public, (b) as may be required or appropriate in any report,
statement or testimony submitted to any municipal, state or Federal regulatory
body having or claiming to have jurisdiction over such Lender or to the Federal
Reserve Board or the Federal Deposit Insurance Corporation or similar
organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required or appropriate in response to any summons or subpoena or
in connection with any litigation, (d) in order to comply with any law, order,
regulation or ruling applicable to such Lender, and (e) to any prospective
transferee in connection with any contemplated transfer of any of the Loans or
Notes or any interest therein by such Lender provided that such prospective
transferee agrees to be bound by the provisions of this Section. In connection
with any disclosure by a Lender pursuant to clause (c) of the immediately
preceding sentence, such Lender agrees to use its best efforts to give Workflow
prior notice of such disclosure to the extent such prior notice is practicable
or permitted under the circumstances, although the failure to give any such
notice shall not result in any liability of such Lender to Workflow or any of
its Subsidiaries. No Lender shall be obligated or required to return any
materials furnished by any Borrower or any Subsidiary of any Borrower. The
Borrowers hereby agree that the failure of a Lender to comply with the
provisions of this Section 12.15 shall not relieve any Borrower of any of its
obligations to such Lender under this Agreement and the other Credit Documents.
(b) Each of the Borrowers hereby acknowledges and agrees that each Lender
may, in connection with the Transaction or the participation of such Lender
pursuant to this Agreement and the other Credit Documents, share with any of its
affiliates any information related to Workflow or any of its Subsidiaries
(including, without limitation, any nonpublic customer information regarding the
creditworthiness of Workflow and its Subsidiaries, provided such Persons shall
be subject to the provisions of this Section 12.15 to the same extent as such
Lender).
12.16 Waiver of Jury Trial. Each of the parties to this Agreement hereby
irrevocably waives all right to a trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Agreement, the other Credit
Documents or the transactions contemplated hereby or thereby.
12.17 Register. The Borrowers hereby designate the Agent to serve as the
Borrowers' agent, solely for purposes of this Section 12.17, to maintain a
register (the "Register") on which it will record the Commitments from time to
time of each of the Lenders, the Loans made by each of the Lenders and each
repayment in respect of the principal amount of the Loans of each Lender.
Failure to make any such recordation, or any error in such recordation, shall
not affect the Borrowers' obligations in respect of such Loans. With respect to
any Lender, the
111
transfer of the Commitments of such Lender and the rights to the principal of,
and interest on, any Loan made pursuant to such Commitments shall not be
effective until such transfer is recorded on the Register maintained by the
Agent with respect to ownership of such Commitments and Loans and prior to such
recordation all amounts owing to the transferor with respect to such Commitments
and Loans shall remain owing to the transferor. The registration of assignment
or transfer of all or part of any Commitments and Loans shall be recorded by the
Agent on the Register only upon the acceptance by the Agent of a properly
executed and delivered Assignment and Assumption Agreement pursuant to Section
12.04(b). Coincident with the delivery of such an Assignment and Assumption
Agreement to the Agent for acceptance and registration of assignment or transfer
of all or part of a Loan, or as soon thereafter as practicable, the assigning or
transferor Lender shall surrender the Note (if any) evidencing such Loan, and
thereupon one or more new Notes in the same aggregate principal amount shall be
issued to the assigning or transferor Lender and/or the new Lender upon the
request of any such Lender. The Borrowers jointly and severally agree to
indemnify the Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Agent in performing its duties under this Section 12.17.
12.18 Judgment Currency. (a) The Credit Parties' obligations hereunder and
under the other Credit Documents to make payments in the respective Applicable
Currency (the "Obligation Currency") shall not be discharged or satisfied by any
tender or recovery pursuant to any judgment expressed in or converted into any
currency other than the Obligation Currency, except to the extent that such
tender or recovery results in the effective receipt by the Agent, the Collateral
Agent or the respective Lender of the full amount of the Obligation Currency
expressed to be payable to the Agent, the Collateral Agent or such Lender under
this Agreement or the other Credit Documents. If for the purpose of obtaining or
enforcing judgment against any Credit Party in any court or in any jurisdiction,
it becomes necessary to convert into or from any currency other than the
Obligation Currency (such other currency being hereinafter referred to as the
"Judgment Currency") an amount due in the Obligation Currency, the conversion
shall be made, at the Canadian Dollar Equivalent or the Dollar Equivalent
thereof, as the case may be, and, in the case of other currencies, the rate of
exchange (as quoted by the Agent or if the Agent does not quote a rate of
exchange on such currency, by a known dealer in such currency designated by the
Agent) determined, in each case, as of the day immediately preceding the day on
which the judgment is given (such Business Day being hereinafter referred to as
the "Judgment Currency Conversion Date").
(b) If there is a change in the rate of exchange prevailing between the
Judgment Currency Conversion Date and the date of actual payment of the amount
due, the Borrowers covenant and agree to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount) as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate or exchange prevailing on the Judgment Currency Conversion
Date.
112
(c) For purposes of determining the Canadian Equivalent or the Dollar
Equivalent or any other rate of exchange for this Section, such amounts shall
include any premium and costs payable in connection with the purchase of the
Obligation Currency.
12.19 Authorization for Quebec Security. For greater certainty, and without
limiting the powers of the Agent hereunder or under any of the Security
Documents, DBF hereby acknowledges that the Agent shall, for purposes of holding
any security granted by DBF on DBF's property pursuant to the laws of the
Province of Quebec, be the holder of an irrevocable power of attorney (within
the meaning of the Civil Code of Quebec) for all present and future Lenders, and
in particular for all present and future holders of any debenture described in
Exhibit I-4. Each of the Lenders hereby irrevocably constitutes, to the extent
necessary, the Agent as the holder of an irrevocable power of attorney (within
the meaning of Article 2692 of the Civil Code of Quebec) in order to hold
security granted by DBF in the Province of Quebec. Any assignee of any Lender
shall be deemed to have confirmed and ratified the constitution of the Agent as
the holder of such irrevocable power of attorney by execution of the relevant
Assignment and Assumption agreement. Notwithstanding the provisions of Section
32 of the Special Corporate Powers Act (Quebec), the Agent may acquire and be
the holder of any debenture issued by DBF as contemplated under any of the
Security Documents at any time and from time to time. DBF hereby acknowledges
that any such debenture constitutes a title of indebtedness, as such term is
used in Article 2692 of the Civil Code of Quebec.
* * *
113
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Agreement to be duly executed and delivered as of the date first above
written.
Address: WORKFLOW MANAGEMENT, INC.
230 Royal Palm Way
Suite 408
Palm Beach, FL 33480
(561) 659-6551 By
--------------------------------
Name:
Title:
DATA BUSINESS FORMS LIMITED
By
--------------------------------
Name:
Title:
BANKERS TRUST COMPANY,
Individually and as Agent
By
--------------------------------
Name:
Title:
BANKBOSTON, N.A.
By
--------------------------------
Name: Jorge A. Schwarz
Title: Director
BANK OF MONTREAL
By
--------------------------------
Name: Robert Sadokierski
Title: Senior Manager, Corporate Finance
By
--------------------------------
Name: Gary E. Kelley
Title: Vice-President
COMERICA BANK
By
--------------------------------
Name:
Title:
FLEET NATIONAL BANK
By
--------------------------------
Name: Jeffrey C. Lynch
Title: Vice-President
THE FIRST NATIONAL BANK OF CHICAGO
By
--------------------------------
Name: Gaye C. Plunkett
Title: Vice-President
THE FUJI BANK AND TRUST COMPANY
By
--------------------------------
Name: Raymond Ventura
Title: Vice-President
NATIONAL BANK OF CANADA
By
--------------------------------
Name: James Drum
Title: Vice-President
By
--------------------------------
Name: Gaetan Frosina
Title: Vice-President
NATIONSBANK, N.A.
By
--------------------------------
Name: Eileen M. Mayette
Title: Commercial Banking Officer
PNC BANK, N.A.
By
--------------------------------
Name: James D. Neil
Title: Vice-President
WACHOVIA BANK, N.A.
By
--------------------------------
Name: Tammy F. Hughes
Title: Vice-President
ANNEX II
BANK ADDRESSES
Bankers Trust Company 130 Liberty Street same
New York, New York 10006
Tel. No.: (212) 250-9535
Fax No.: (212) 669-1533
Attention: Keith Stimson
BankBoston, N.A. 100 Federal Street same
Boston, MA 02110
Tel. No.: (617) 434-4195
Fax No.: (617) 434-1574
Attention: Fred Myers
Bank of Montreal First Canadian Place c/o Harris Trust &
11th Floor Savings Trust
Corporate Finance 115 South La Salle St.
Personal and Commercial 12th Floor
Financial Services Chicago, IL 60603
Toronto, Ontario M5X1A1
Tel. No.: (416) 643-2562 First Canadian Place
Fax No.: (416) 360-7168 Concourse Level
Attention: Robert Sadokierski P.O. Box 3
Toronto, Ontario M5X1A1
Comerica Bank 500 Woodward Avenue same
Detroit, MI 48226-3280
Tel. No.: (313) 222-6122
Fax No.: (313) 222-3330
Attention: Marty Ellis
The First National Bank of Chicago One First National Plaza First Chicago NBD
Chicago, IL 60670 Bank, Canada
Tel. No.: (312) 732-1601 BCE Place
Fax No.: (312) 732-5435 P.O. Box 613
Attention: Gaye Plunkett 161 Bay Street
Suite 4240
Toronto, Ontario
M5J 2S1
Fleet National Bank One Federal Street same
M/S: MA of D07L
Boston, MA 02211
Tel. No.: (617) 346-5061
Fax No.: (617) 346-0575
Attention: Jeffrey C. Lynch
ANNEX II
Page 2
The Fuji Bank and Trust Company Two World Trade Center same
New York, NY 10048
Tel. No.: (212) 898-2062
Fax No.: (212) 321-9407
Attention: Raymond Ventura
National Bank of Canada 125 West 55th Street 350 West Burnham-thorpe Road
23rd Floor Suite 305
New York, NY 10019-5366 Mississaugua, Ontario
Tel. No.: (212) 632-8523 L5B3J1
Fax No.: (212) 632-8616
Attention: James Drum
NationsBank, N.A. One Commercial Place same
3rd Floor
Norfolk, VA 23510-2103
Tel. No.: (757) 624-2956
Fax No.: (757) 441-8599
Attention: Eileen Mayette
PNC Bank, N.A. 500 West Jefferson Street One PNC Plaza
Louisville, KY 40202 2nd Floor
Tel. No.: (502) 581-3242 249 Fifth Avenue
Fax No.: (502) 581-2303 Pittsburgh, PA 15222-2707
Attention: James Neil
Wachovia Bank, N.A. 191 Peachtree Street, N.E. same
Atlanta, GA 30303
Tel. No.: (404) 332-5134
Fax No.: (404) 332-5016
Attention: Tammy F. Hughes
ANNEX III
CERTAIN PROVISIONS RELATING TO BANKERS' ACCEPTANCES
This Annex III sets forth certain terms and conditions relating to the
obligation of the Canadian Lenders to make loans to DBF pursuant to Section
1.01(a)(iii) of the Credit Agreement by way of Bankers' Acceptances. Capitalized
terms used herein shall have the meanings assigned to such terms in the Credit
Agreement.
(a) Availability. All notices of borrowings, conversions or continuations
for Bankers' Acceptances shall be in a minimum aggregate Face Amount of Cdn
$2,500,000 or a multiple of Cdn $100,000 in excess thereof, and a Canadian
Lender shall not be obliged to accept any bill of exchange which:
(i) is drawn on or which matures on a day which is not a Business Day;
(ii) matures on a day subsequent to the Final Maturity Date;
(iii) has a term other than approximately 30, 60, 90 or 180 days;
(iv) is denominated in any currency other than Canadian Dollars;
(v) is not in a form satisfactory to such Canadian Lender or the
Agent;
(vi) has a Face Amount of less than Cdn. $1,000,000 or the Face Amount
is not an integral multiple of Cdn. $100,000; or
(vii) in respect of which DBF has not then paid the applicable
Acceptance Fee.
(b) Grace. DBF hereby renounces, and shall not claim or request or require
any Canadian Lender to claim, any days of grace for the payment of any Bankers'
Acceptance.
(c) Bankers' Acceptances in Blank. To facilitate the acceptance by the
Canadian Lenders of Drafts as contemplated by the Credit Agreement and this
Annex III, DBF shall, on the Effective Date and from time to time as required,
supply each Canadian Lender with such numbers of Drafts as it may request, each
executed and endorsed in blank by DBF. Each Canadian Lender shall exercise such
care in the custody and safekeeping of such bills as they give to similar
property owned by them. Each Canadian Lender is hereby authorized to issue such
Bankers' Acceptances endorsed in blank in such Face Amounts as may be determined
by such Canadian Lender, provided that the aggregate amount thereof is equal to
the aggregate amount of Bankers' Acceptances required to be accepted by such
Canadian Lender. No Canadian Lender shall be responsible or liable for its
failure to accept a Bankers' Acceptance if the cause of such failure is, in
whole or in part, due to the failure of DBF to provide duly executed and
endorsed drafts to such Canadian Lender on a timely basis, nor shall any
Canadian Lender be liable for any damage, loss or other claim arising by reason
of any loss or improper use of any such instrument except loss or improper use
to the extent same has been finally judicially determined to have arisen by
reason of the gross negligence or willful misconduct of
ANNEX III
Page 2
such Canadian Lender, its officers, employees, agents or representatives.
Each Canadian Lender shall maintain a record with respect to Bankers'
Acceptances (i) received by it from DBF in blank hereunder, (ii) voided by it
for any reason, (iii) accepted by it hereunder, (iv) purchased by it
hereunder, and (v) canceled at their respective maturity dates.
(d) Execution of Bankers' Acceptances. Upon the request of any Canadian
Lender, DBF shall provide to such Canadian Lender a power of attorney to
complete, sign, endorse and issue Bankers' Acceptances on behalf of DBF in form
and substance satisfactory to such Canadian Lender. Notwithstanding that any one
or more of the individuals whose manual or facsimile signature appears on any
bill as a signatory on behalf of DBF may no longer hold office at the date of
such bill or at the date of its acceptance by any Canadian Lender hereunder, or
at any time thereafter, any Bankers' Acceptance signed as aforesaid on behalf of
DBF shall be valid and binding upon DBF.
(e) Issuance of Bankers' Acceptances. Promptly following receipt of a
notice of borrowing, conversion or continuation by way of Bankers' Acceptances,
the Agent shall so advise the Canadian Lenders and shall advise each Canadian
Lender of the Face Amount of each Bankers' Acceptance to be accepted by it and
the term thereof. The aggregate Face Amount of Bankers' Acceptances to be
accepted by an Canadian Lender shall be determined by the Agent by reference to
the respective Canadian Percentages of the Canadian Lenders, except that, if the
Face Amount of the Bankers' Acceptance, that would otherwise be accepted by an
Canadian Lender, would not be Cdn. $100,000 or a multiple thereof, such Face
Amount shall be increased or reduced by the Agent in its sole discretion to the
nearest multiple of Cdn. $100,000.
Notwithstanding the foregoing, if by reason of any increase or reduction
described in the immediately preceding sentence, any Canadian Lender shall have
aggregate Bankers' Acceptances and Canadian Revolving Loans in excess of its
respective Canadian Percentage of the total outstanding Bankers' Acceptances and
Canadian Revolving Loans for all the Canadian Lenders (any such Lender being
herein called an "Over-Allotted Lender"), then at any time following the
occurrence and during the continuance of an Event of Default, each other
Canadian Lender agrees, upon request of the Over-Allotted Lender, to promptly
purchase from such Over-Allotted Lender participations in (or, if and to the
extent specified by any such purchasing Lender, direct interests in) the
Bankers' Acceptances and Canadian Revolving Loans owing to the Over-Allotted
Lender (and in interest due thereon, as the case may be) in such amounts, and to
make such other adjustments from time to time as shall be equitable, to the end
that all the Canadian Lenders shall hold the Bankers' Acceptances and Canadian
Revolving Loans ratably according to their respective Canadian Percentages.
(f) Purchase of Bankers' Acceptances: Continuations as and Conversions into
Bankers' Acceptance Loans. Subject to clause (k) below, upon the acceptance of a
Bankers' Acceptance by an Canadian Lender, such Canadian Lender shall purchase,
or arrange the purchase of, each Bankers' Acceptance from DBF at a price
determined by the Discount Rate of such Bankers' Acceptance and provide to the
Agent at the relevant Payment Office the BA Discount Proceeds for the account of
DBF. The BA Discount Proceeds so received by the Agent from the Canadian Lenders
shall be retained by the Agent and applied as follows: (i) remitted to
ANNEX III
Page 3
DBF, (ii) to the prepayment of Canadian Prime Rate Loans (which shall
constitute a conversion of the Canadian Revolving Loans from Canadian Prime Rate
Loans to Bankers' Acceptance Loans) or (iii) to the payment of Bankers'
Acceptances maturing on such date (which shall constitute a continuation of
Bankers' Acceptance Loans to new Bankers' Acceptance Loans), provided that in
the case of any such conversion or continuation of Loans, DBF shall pay to the
Agent for account of the respective Canadian Lenders such additional amounts, if
any, as shall be necessary to effect the prepayment in full of the respective
Canadian Prime Rate Loans being prepaid, or the Bankers' Acceptances maturing,
on such date.
On any date on which a conversion or continuation described in the
preceding paragraph shall occur, the Agent shall be entitled to net all amounts
payable on such date by the Agent to an Canadian Lender against all amounts
payable on such date by such Canadian Lender to the Agent. Similarly, on any
such date, DBF hereby authorizes each Canadian Lender to net all amounts payable
on such date by such Canadian Lender to the Agent for the account of DBF,
against all amounts payable on such date by DBF to such Canadian Lender in
accordance with the Agent's calculations.
(g) Acceptance Fees. DBF shall pay to the Agent, in advance, for
distribution to each Canadian Lender which accepts a Bankers' Acceptance (based
on their respective Canadian Percentages), an Acceptance Fee in respect of the
Face Amount of such Bankers' Acceptance, which shall be payable on or before the
date of acceptance of such Bankers' Acceptance.
(h) Prepayments. Subject to clause (j) of this Annex III, and except as
otherwise expressly provided under the Credit Agreement, no prepayment of any
Bankers' Acceptances shall be made by DBF prior to the maturity date of such
Bankers' Acceptance.
(i) Payment; Conversion or Renewal of Bankers' Acceptances. Upon maturity
of a Bankers' Acceptance, DBF may (i) elect to issue a replacement Bankers'
Acceptance by giving a notice of continuation prior to 11:00 A.M. (New York
time) at least three Business Days prior to the maturity date thereof, which
notice shall comply with the requirements of clause (a) of this Annex III; (ii)
elect to have all or a portion of the Face Amount of the Bankers' Acceptance
converted to a Canadian Prime Rate Loan by giving a Notice of Borrowing in
accordance with Section 1.03 of the Credit Agreement; or (iii) pay to the Agent,
on or before 10:00 A.M. (New York time) on the maturity date for the Bankers'
Acceptance, an amount in Canadian Dollars equal to the Face Amount of the
Bankers' Acceptance (notwithstanding that the Canadian Lender may be the holder
of it at maturity). Unless a Bankers' Acceptance is paid in full at the maturity
thereof, or continued as another Canadian Revolving Loan by way of Bankers'
Acceptances, the obligation of DBF to any Canadian Lender in respect of a
maturing Bankers' Acceptance accepted by such Canadian Lender shall be deemed to
be converted automatically into a Canadian Prime Rate Loan in an amount equal to
the full Face Amount of the maturing Bankers' Acceptance. Such Canadian Prime
Rate Loan shall be subject to all of the provisions of the Credit Agreement
applicable to a Canadian Prime Rate Loan, including in particular the obligation
to pay interest, from and after the maturity date of such Bankers' Acceptance.
ANNEX III
Page 4
(j) Default. Upon the acceleration of the Canadian Revolving Loans to be
due and payable pursuant to Section 9 of the Credit Agreement (whether by action
of the Agent or the Required Lenders, or automatically by reason of the
occurrence of an Event of Default referred to in Section 9.05 with respect to
any Borrower), DBF shall pay to the Agent in satisfaction of the obligations of
DBF to the Canadian Lenders in respect of then-outstanding Bankers' Acceptances,
and there shall become immediately due and payable, an amount equal to:
(i) the aggregate Face Amount of all outstanding Bankers' Acceptances
thereof; and
(ii) all unpaid Acceptance Fees, if any.
(k) Circumstances Making Bankers' Acceptances Unavailable. If the Agent
shall have reasonably determined (which determination shall be conclusive and
binding upon all parties hereto) and notified DBF and each of the Canadian
Lenders that, by reason of circumstances arising after the Effective Date and
affecting the Canadian money market (i) there is no market for Bankers'
Acceptances or (ii) the demand for Bankers' Acceptances is insufficient to allow
the sale or trading of the Bankers' Acceptances created and purchased hereunder,
then the right of DBF to request that any Canadian Lender accept a Bankers'
Acceptance shall be suspended until the Agent determines that the circumstances
giving rise to such suspension no longer exist and the Agent so notifies DBF.
(l) Indemnification in Respect of Bankers' Acceptances. In addition to any
liability of DBF to any Lender or the Agent under any other provision hereof,
DBF shall indemnify each Lender and the Agent and hold each of them harmless
against any reasonable loss or expense incurred by such Lender or the Agent as a
result of (x) any failure by DBF to fulfill any of its obligations hereunder
including, without limitation, any cost or expense incurred by reason of the
liquidation or re-employment in whole or in part of deposits or other funds
required by any Lender to fund any Bankers' Acceptance as a result of the
failure of DBF to make any payment, repayment or prepayment on the date required
hereunder or specified by it in any notice given hereunder; or (y) DBF's failure
to provide for the payment to the Agent, for the account of each of the Canadian
Lenders, of the full Face Amount of each Bankers' Acceptance on its maturity
date.
(m) Bankers' Acceptances purchased by a Canadian Lender may be held by it
for its own account until the maturity date or sold by it at any time prior to
that date in any relevant Canadian market in such Canadian Lender's sole
discretion.
ANNEX IV
SUBSIDIARIES
ANNEX V
REAL PROPERTY
ANNEX VI
EXISTING DEBT
ANNEX VII
INSURANCE
ANNEX VIII
EXISTING LIENS
Filing Location Debtor Secured Party File Number Original Filing Date Type
- --------------- ------ ------------- ----------- -------------------- ----
ANNEX IX
EXISTING INVESTMENTS
TABLE OF CONTENTS
Page
SECTION 1. Amount and Terms of Credit...........................................................................1
1.01 Commitments..........................................................................................1
1.02 Minimum Borrowing Amounts, etc.......................................................................4
1.03 Notice of Borrowing..................................................................................4
1.04 Competitive Bid Borrowings...........................................................................5
1.05 Disbursement of Funds................................................................................7
1.06 Notes; etc...........................................................................................8
1.07 Conversions.........................................................................................10
1.08 Pro Rata Borrowings.................................................................................10
1.09 Interest............................................................................................11
1.10 Interest Periods....................................................................................12
1.11 Increased Costs, Illegality, etc....................................................................13
1.12 Compensation........................................................................................15
1.13 Lending Offices; Changes Thereto....................................................................16
1.14 Replacement of Lenders..............................................................................16
1.15 Bankers Acceptance Provisions.......................................................................17
1.16 Special Provisions Regarding Canadian Revolving Loans...............................................17
1.17 Certain Override Provisions Regarding Utilizations of the Total Canadian Sub-Commitment.............20
SECTION 2. Letters of Credit...................................................................................21
2.01 Letters of Credit...................................................................................21
2.02 Letter of Credit Requests; Notices of Issuance......................................................23
2.03 Agreement to Repay Letter of Credit Drawings........................................................23
2.04 Letter of Credit Participations.....................................................................24
2.05 Increased Costs.....................................................................................26
SECTION 3. Fees; Adjustments of Commitments....................................................................27
3.01 Fees................................................................................................27
3.02 Voluntary Reduction of Commitments..................................................................28
3.03 Mandatory Adjustments of Commitments, etc...........................................................28
SECTION 4. Payments............................................................................................30
4.01 Voluntary Prepayments...............................................................................30
4.02 Mandatory Prepayments...............................................................................30
4.03 Method and Place of Payment.........................................................................33
4.04 Net Payments........................................................................................33
(i)
Page
SECTION 5. Conditions Precedent................................................................................35
5.01 Execution of Agreement..............................................................................35
5.02 Notes...............................................................................................35
5.03 No Default; Representations and Warranties..........................................................35
5.04 Officers Certificate................................................................................35
5.05 Opinions of Counsel.................................................................................36
5.06 Corporate Proceedings...............................................................................36
5.07 Consummation of the Transaction.....................................................................36
5.08 Adverse Change; Approvals...........................................................................37
5.09 Litigation..........................................................................................37
5.10 Guaranties..........................................................................................37
5.11 Pledge Agreements; Security Agreements..............................................................38
5.12 Mortgages; Title Insurance; Surveys...............................................................39
5.13 Financial Statements; Pro Forma Balance Sheet; Projections..........................................39
5.14 Solvency Certificate; Environmental Analyses; Insurance Certificates................................40
5.15 Plans; Shareholders Agreements; Management Agreements; Collective Bargaining Agreements;
Tax Sharing Agreements; Existing Indebtedness Agreements ..........................................40
5.16 Payment of Fees.....................................................................................41
5.17 Notice of Borrowing; Letter of Credit Request.......................................................41
SECTION 6. Representations, Warranties and Agreements..........................................................41
6.01 Status..............................................................................................42
6.02 Power and Authority.................................................................................42
6.03 No Violation........................................................................................42
6.04 Litigation..........................................................................................43
6.05 Use of Proceeds; Margin Regulations.................................................................43
6.06 Approvals...........................................................................................43
6.07 Investment Company Act..............................................................................43
6.08 Public Utility Holding Company Act..................................................................43
6.09 True and Complete Disclosure........................................................................43
6.10 Financial Condition; Financial Statements...........................................................44
6.11 Security Interests..................................................................................45
6.12 Tax Returns and Payments............................................................................45
6.13 Compliance with ERISA...............................................................................46
6.14 Ownership; Subsidiaries.............................................................................47
6.15 Capitalization......................................................................................47
6.16 Intellectual Property...............................................................................47
6.17 Compliance with Statutes, etc.......................................................................47
6.18 Environmental Matters...............................................................................47
6.19 Real Properties.....................................................................................48
6.20 Labor Relations.....................................................................................48
6.21 Indebtedness........................................................................................48
6.22 Other Documents.....................................................................................49
(ii)
Page
6.23 Insurance...........................................................................................49
SECTION 7. Affirmative Covenants...............................................................................49
7.01 Information Covenants...............................................................................49
7.02 Books, Records and Inspections; Annual Meetings.....................................................52
7.03 Maintenance of Property; Insurance..................................................................52
7.04 Payment of Taxes....................................................................................53
7.05 Corporate Franchises................................................................................53
7.06 Compliance with Statutes, etc.......................................................................53
7.07 Good Repair.........................................................................................53
7.08 Compliance with Environmental Laws..................................................................53
7.09 ERISA...............................................................................................54
7.10 Performance of Obligations...................................................................... ..55
7.11 End of Fiscal Years; Fiscal Quarters................................................................55
7.12 Additional Security; Further Assurances.............................................................56
7.13 Foreign Subsidiaries Security.......................................................................57
7.14 Landlord Waivers and Estoppel Certificates.........................................................57
SECTION 8. Negative Covenants..................................................................................58
8.01 Changes in Business.................................................................................58
8.02 Consolidation, Merger, Sale or Purchase of Assets, etc..............................................58
8.03 Liens...............................................................................................61
8.04 Indebtedness........................................................................................63
8.05 Capital Expenditures................................................................................64
8.06 Advances, Investments and Loans.....................................................................64
8.07 Dividends, etc......................................................................................65
8.08 Transactions with Affiliates........................................................................66
8.09 Leverage Ratio......................................................................................66
8.10 Consolidated Interest Coverage Ratio................................................................67
8.11 Limitation on Modifications of Certificate of Corporation, By-Laws and Spinoff Documents; etc.......67
8.12 Limitation on the Creation of Subsidiaries..........................................................67
SECTION 9. Events of Default...................................................................................68
9.01 Payments............................................................................................68
9.02 Representations, etc................................................................................68
9.03 Covenants...........................................................................................68
9.04 Default Under Other Agreements......................................................................68
9.05 Bankruptcy, etc.....................................................................................69
9.06 ERISA...............................................................................................69
9.07 Security Documents..................................................................................70
9.08 Guaranties..........................................................................................70
9.09 Judgments...........................................................................................70
9.10 Change of Control...................................................................................70
(iii)
Page
SECTION 10. Definitions.........................................................................................71
SECTION 11. The Agent...........................................................................................97
11.01 Appointment.........................................................................................97
11.02 Delegation of Duties................................................................................97
11.03 Exculpatory Provisions..............................................................................98
11.04 Reliance by Agent...................................................................................98
11.05 Notice of Default...................................................................................98
11.06 Non-Reliance on Agent and other Lenders.............................................................99
11.07 Indemnification.....................................................................................99
11.08 Agent in its Individual Capacity...................................................................100
11.09 Holders............................................................................................100
11.10 Resignation of the Agent; Successor Agent..........................................................100
SECTION 12. Miscellaneous......................................................................................101
12.01 Payment of Expenses, etc...........................................................................101
12.02 Right of Setoff....................................................................................102
12.03 Notices............................................................................................102
12.04 Benefit of Agreement...............................................................................102
12.05 No Waiver; Remedies Cumulative.....................................................................104
12.06 Payments Pro Rata..................................................................................104
12.07 Calculations; Computations.........................................................................105
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE...................................................106
12.09 Counterparts.......................................................................................107
12.10 Effectiveness......................................................................................107
12.11 Headings Descriptive...............................................................................107
12.12 Amendment or Waiver................................................................................107
12.13 Survival...........................................................................................108
12.14 Domicile of Loans..................................................................................108
12.15 Confidentiality....................................................................................108
12.16 Waiver of Jury Trial...............................................................................109
12.17 Register...........................................................................................109
12.18 Judgment Currency..................................................................................110
12.19 Authorization for Quebec Security..................................................................110
(iv)
ANNEX I-A Commitments
ANNEX I-B Canadian Sub-Commitments
ANNEX II Bank Addresses; Applicable Lending Offices
ANNEX III Certain Provisions Relating to Bankers' Acceptances
ANNEX IV Subsidiaries
ANNEX V Real Property
ANNEX VI Existing Debt
ANNEX VII Insurance
ANNEX VIII Existing Liens
ANNEX IX Existing Investments
ANNEX X ERISA Matters
EXHIBIT A-1 -- Form of Notice of Borrowing
EXHIBIT A-2 -- Form of Letter of Credit Request
EXHIBIT B -- Form of Notice of Competitive Bid Borrowing
EXHIBIT C-1 -- Form of Dollar Revolving Note
EXHIBIT C-2 -- Form of Canadian Revolving Note
EXHIBIT C-3 -- Form of Swingline Note
EXHIBIT D -- Form of Section 4.04(b)(ii) Certificate
EXHIBIT E-1 -- Form of Opinion of Kaufman & Canoles
EXHIBIT E-2 -- Form of Opinion of Goodman, Phillips & Vineberg
EXHIBIT F -- Form of Officers' Certificate
EXHIBIT G-1 -- Form of U.S. Subsidiaries Guaranty
EXHIBIT G-2 -- Form of Canadian General Guaranty
EXHIBIT G-3 -- Form of Canadian Parent Guaranty
EXHIBIT H-1 -- Form of U.S. Pledge Agreement
EXHIBIT H-2 -- Form of Canadian Pledge Agreement
EXHIBIT I-1 -- Form of U.S. Security Agreement
EXHIBIT I-2 -- Form of Canadian Security Agreement
EXHIBIT I-3 -- Form of Canadian Security Agreement (Hypothec)
EXHIBIT I-4 -- Form of Canadian Debenture and Debenture Pledge Agreement
EXHIBIT J -- Form of Solvency Certificate
EXHIBIT K -- Form of Assignment and Assumption Agreement
EXHIBIT L -- Form of Intercompany Note
(v)