Exhibit 10.1
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
MAY 31, 2005
by and among
GREATBATCH LTD., formerly known as Wilson Greatbatch, Ltd.
the LENDERS Party Hereto
and
MANUFACTURERS AND TRADERS TRUST COMPANY
as Administrative Agent and Lead Arranger
$50,000,000
TABLE OF CONTENTS
ARTICLE I DEFINITIONS 1
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1.01 Defined Terms. 1
1.02 Terms Generally. 17
1.03 Accounting Terms; GAAP. 17
ARTICLE II THE CREDIT FACILITY 19
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2.01 Revolving Credit Facilities. 19
2.02 Requests for Loans. 20
2.03 Requests for Swingline Loans. 21
2.04 Letters of Credit. 23
2.05 Funding of Borrowings. 27
2.06 Interest Elections. 27
2.07 Termination and Reduction of the Commitments. 29
2.08 Repayment and Prepayment of Loans; Evidence of Debt. 30
2.09 Fees. 31
2.10 Interest. 32
2.11 Alternate Rate of Interest. 32
2.12 Increased Costs. 33
2.13 Break Funding Payments. 34
2.14 Taxes. 34
2.15 Payments Generally; Pro Rata Treatment; Sharing of Set-offs. 35
2.16 Mitigation Obligations; Replacement of Lenders. 37
ARTICLE III REPRESENTATIONS AND WARRANTIES 38
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3.01 Organization; Powers. 38
3.02 Authorization; Enforceability. 38
3.03 Governmental Approvals; No Conflicts. 38
3.04 Financial Condition; No Material Adverse Change. 38
3.05 Properties. 39
3.06 Litigation and Environmental Matters. 39
3.07 Compliance with Laws and Agreements. 40
3.08 Investment and Holding Company Status. 40
3.09 Taxes. 40
3.10 ERISA. 40
3.11 Disclosure. 40
3.12 Use of Credit. 40
3.13 Anti-Terrorism Law Compliance
41
ARTICLE IV CONDITIONS 41
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4.01 Effective Date. 41
4.02 Each Credit Event. 43
ARTICLE V AFFIRMATIVE COVENANTS 43
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5.01 Financial Statements and Other Information. 43
5.02 Notices of Material Events. 44
5.03 Existence: Conduct of Business. 45
5.04 Future Subsidiaries; Subsidiary Guarantors. 45
5.05 Future Parent Entities; Parent Guarantors. 45
5.06 Payment of Obligations. 46
5.07 Maintenance of Properties; Insurance. 46
5.08 Books and Records; Inspection Rights. 46
5.09 Compliance with Laws. 46
5.10 Use of Proceeds. 46
5.11 Anti-Terrorism Laws
47
ARTICLE VI NEGATIVE COVENANTS 46
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6.01 Indebtedness. 47
6.02 Liens. 49
6.03 Fundamental Changes. 50
6.04 Lines of Business. 51
6.05 Restrictive Agreements. 51
6.06 Investments, Loans, Advances, Guarantees and Acquisitions;
Hedging Agreements. 52
6.07 Restricted Payments. 52
6.08 Transactions with Affiliates. 53
6.09 Sale and Lease-Back Transactions. 53
ARTICLE VII EVENTS OF DEFAULT 53
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ARTICLE VIII THE ADMINISTRATIVE AGENT 56
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ARTICLE IX MISCELLANEOUS 58
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9.01 Notices. 58
9.02 Waivers; Amendments. 59
9.03 Expenses; Indemnity; Damage Waiver. 61
9.04 Successors and Assigns. 62
9.05 Survival. 64
9.06 Counterparts; Integration; Effectiveness. 64
9.07 Severability. 65
9.08 Right of Setoff. 65
9.09 Governing Law; Jurisdiction: Etc. 65
9.10 Waiver of Jury Trial 66
9.11 Headings. 66
9.12 Treatment of Certain Information: Confidentiality. 66
9.13 USA Patriot Act 67
SCHEDULE I - Commitments
SCHEDULE II - Existing Indebtedness, Liens and Investments
SCHEDULE III - Litigation
SCHEDULE IV - Environmental Matters
SCHEDULE V - Existing Letters of Credit
EXHIBIT A - Form of Assignment and Acceptance
EXHIBIT B - Form of Opinion of Counsel to the Borrower
EXHIBIT C - Form of Revolving Credit Note
EXHIBIT D - Form of Revolving Credit Borrowing Request
EXHIBIT E - Form of Interest Election Request for Revolving
Credit Borrowing
EXHIBIT F - Form of Borrower Compliance Certificate
ii
SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated as of May 31, 2005, by
and among GREATBATCH LTD., a New York corporation, formerly known as Wilson
Greatbatch, Ltd. ("Borrower"), the LENDERS party hereto, and MANUFACTURERS AND
TRADERS TRUST COMPANY, a New York banking corporation, as Administrative Agent
and Lead Arranger.
RECITALS
Pursuant to a Credit Agreement dated as of January 12, 2001 (the "Original
Credit Agreement") the Lenders (as hereinafter defined) extended credit to the
Borrower in an aggregate principal or face amount not exceeding Sixty Million
Dollars ($60,000,000) at any one time outstanding (the "Original Credit
Facilities").
Pursuant to an Amended and Restated Credit Agreement dated as of June 18,
2001, the Lenders modified the Original Credit Agreement and increased the
amount of the Original Credit Facilities by extending credit to the Borrower in
an aggregate principal or face amount not exceeding One Hundred Million Dollars
($100,000,000), made available Swingline Loans (as hereinafter defined), and
made certain other changes to the Original Credit Agreement (as modified, the
"Amended and Restated Credit Agreement").
The Amended and Restated Credit Agreement was amended by a First Amendment
dated as of August 31, 2001, a Second Amendment dated as of July 1, 2002 and a
Third Amendment dated as of May 23, 2003 ( the Amended and Restated Credit
Agreement together with the First Amendment, Second Amendment and Third
Amendment are referred to herein as the "First Amended and Restated Credit
Agreement").
On or about May 23, 2003, the Borrower irrevocably paid in full the
outstanding principal and interest balance of the term loan facilities extended
pursuant to the First Amended and Restated Credit Agreement.
The Borrower has requested the Lenders to further amend and restate the
First Amended and Restated Credit Agreement to (i) increase the Lenders'
Revolving Credit Commitment (as defined herein) from $20,000,000.00 to
$50,000,000.00, (ii) to revise certain financial and other covenants and (iii)
to delete the provisions related to the term loan facilities that have been
irrevocably paid in full by the Borrower. The Lenders are prepared to amend and
restate the First Amended and Restated Credit Agreement, upon the terms and
conditions of this Second Amended and Restated Credit Agreement.
Now, the parties hereto, intending to be legally bound, agree as follows:
ARTICLE I DEFINITIONS
1.01 Defined Terms. As used in this Agreement, the following terms have the
meanings specified below:
"ABR" when used in reference to any Loan or Borrowing, indicates that such
Loan, or the Loans constituting such Borrowing, are bearing interest at a rate
determined by reference to the Adjusted Base Rate.
"Adjusted LIBOR" means, with respect to any ALR Loan for the related
Interest Period, the rate per annum that is equal to the sum of (a) the
Applicable Margin, plus (b) the rate per annum obtained by multiplying (i) the
LIBOR, by (ii) the Eurocurrency Reserve Rate, all as conclusively determined by
the Administrative Agent, such sum to be rounded up, if necessary, to the
nearest whole multiple of one hundredth (1/100th) of one percent (1%).
"Adjusted Base Rate" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate and (b) the sum of the Federal Funds Effective
Rate on such day, plus one-half of one percent (0.50%), plus the Applicable
Margin in effect for such day.
"Administrative Agent" means M&T, in its capacity as administrative agent
for the Lenders hereunder.
"Administrative Agent's Account" means an account designated by the
Administrative Agent in a notice to the Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"ALR" when used in reference to any Loan or Borrowing, indicates that such
Loan, or the Loans constituting such Borrowing, are bearing interest at a rate
determined by reference to the Adjusted LIBOR.
"Anti-Terrorism Law" means the USA Patriot Act or any other law pertaining
to the prevention of future acts of terrorism, in each case as such law may be
amended from time to time.
"Applicable Margin" means, for any day, (a) with respect to any ABR Loan
the applicable rate per annum set forth below under the caption "ABR Spread",
(b) with respect to any ALR Loan, the applicable rate per annum set forth below
under the caption "LIBOR Spread", or (c) with respect to the revolving credit
fees payable hereunder, the applicable rate per annum set forth below under the
caption "Revolving Credit Fee Rate", respectively, based upon the Leverage Ratio
as at the end of the most recent fiscal quarter.
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Leverage Ratio (= "x") ABR Spread LIBOR Spread Revolving
Credit Fee Rate
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Category 1: x < 1:50: 1 0.00 1.00 0.125
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Category 2: x =1.50 : 1 and < 2.0: 1 0.00 1.25 0.125
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Category 3: x =2.00 : 1 and < 2.50 : 1 0.00 1.50 0.250
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Category 4: x =2.50:1 and < 3.00 : 1 0.00 1.75 0.250
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Category 5: x =3.00:1 0.00 2.25 0.250
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For purposes of the foregoing, each change in the Applicable Margin resulting
from a change in the Leverage Ratio shall be effective as to any Loans then
outstanding or thereafter made during the period commencing on and including the
date three (3) Business Days after delivery to the Administrative Agent of the
Consolidated financial statements pursuant to Section 5.01(a) or 5.01(b), as
applicable, indicating such change and ending on the date immediately preceding
the effective date of the next such change; provided that the Applicable Margin
shall be deemed to be in Category 5: (i) at any time that an Event of Default
has occurred and is continuing; and (ii) if the Borrower fails to deliver the
Consolidated financial statements required to be delivered by it pursuant to
Section 5.01(a) or 5.01(b), during the period commencing on the expiration date
of the time for delivery thereof and ending on the date three (3) Business Days
after such Consolidated financial statements are delivered.
"Applicable Percentage" means, with respect to any Lender, the percentage
of the total Commitments represented by such Lender's Commitment as set forth
opposite such Lender's name on Schedule I or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment, as applicable.
If the Commitments have terminated or expired, each Lender's Applicable
Percentage shall be determined based upon the Commitments most recently in
effect, after giving effect to any assignments of any Commitments by or among
the Lenders.
"Approved Fund" means any Fund that is administered or managed by (a) any
Lender or (b) an Affiliate of any Lender.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"Availability Period" means the period from and including the Effective
Date to but excluding the earlier of the Revolving Credit Commitment Termination
Date and the date of termination of the Revolving Credit Commitments.
"Board" means the Board of Governors of the Federal Reserve System of the
United States of America.
"Borrower" means Greatbatch Ltd., a New York corporation, formerly known
as Wilson Greatbatch, Ltd.
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"Borrower Pledge Agreement" refers to the Borrower Pledge Agreement dated
January 12, 2001 pursuant to which the Borrower has pledged to the
Administrative Agent (for the benefit of the Lenders) all issued and outstanding
securities of each domestic Subsidiary of the Borrower to secure the payment of
any and all Indebtedness and liabilities, whether now existing or hereafter
incurred, of the Borrower to the Administrative Agent, the Lenders, the
Swingline Lender and the Issuing Lender arising under or evidenced by the Loan
Documents.
"Borrowing" means (a) all ABR Loans made, converted or continued on the
same date, or (b) all ALR Loans (or portions thereof) that have the same
Interest Period.
"Borrowing Request" means a request by the Borrower for a Borrowing of
Revolving Credit Loans in accordance with Section 2.02 or 2.03, as applicable.
"Business Day" means any day (a) that is not a Saturday, Sunday or other
day on which commercial banks in Buffalo, New York are authorized or required by
law to remain closed, and (b) if such day relates to a borrowing of, a payment
or prepayment of principal of or interest on, a continuation or conversion of or
into, or the Interest Period for, an ALR Borrowing, or to a notice by the
Borrower with respect to any such Borrowing, payment, prepayment, continuation,
conversion, or Interest Period, a day that is also a day on which dealings in
deposits for United States Dollars are carried out in the London interbank
market.
"Capital Lease Obligations" of any Person means the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
"Cash Interest Expense" of any Person means, for any period, the aggregate
consolidated interest expense of such Person including (without duplication and
in accordance with GAAP) the following: (a) all interest in respect of
Indebtedness (including the interest component of any payments in respect of
Capital Lease Obligations and synthetic lease obligations) accrued or
capitalized during such period (whether or not actually paid during such
period), plus (b) the net amount payable (or minus the net amount receivable)
under interest rate Hedging Agreements during such period (whether or not
actually paid or received during such period), minus (c) the sum of (i) interest
income during such period, plus (ii) all amounts attributable to non-cash items
of interest expense, all as determined in accordance with GAAP.
"Change in Control" means any time at which (a) Technologies shall cease
to beneficially own, in the aggregate, one hundred percent (100%) of the total
combined voting power of all classes of voting capital stock of Holdings, free
and clear of all Liens (including, without limitation, pursuant to any voting
trust or other agreement to which such shareholder becomes a party or bound by,
that in any way limits the right or ability of such shareholder to exercise one
hundred percent (100%) of such total combined voting powers); or (b) Wilson
Greatbatch Intermediate Holdings, Inc. shall cease to beneficially own, in the
aggregate, one hundred percent (100%) of the total combined voting power of all
classes of voting stock of the Borrower, free and clear of all Liens (including,
without limitation, pursuant to any voting trust or other agreement to which
such shareholder becomes a party or bound by, that in any way limits the right
or ability of such shareholder to exercise one hundred percent (100%) of such
total combined voting powers).
4
"Change in Law" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement, or (c) compliance by any Lender or the Issuing
Lender (or, for purposes of Section 2.12(b), by any lending office of such
Lender or by such Lender's or the Issuing Lender's holding company, if any) with
any request, guideline or directive (whether or not having the force of law) of
any Governmental Authority made or issued after the date of this Agreement.
"CIP Regulations" has the meaning set forth in Article VIII.
"Closing Fee" has the meaning set forth in paragraph 2.09(c).
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral Agency Agreement" shall have the meaning ascribed to such term
in Section 6.01(a)(iv), as such agreement may be modified, amended or
supplemented from time to time.
"Commitment" means, with respect to a Lender, the commitment of such
Lender to make Loans and to acquire participations in Letters of Credit
hereunder, expressed as an amount representing the maximum aggregate amount of
such Lender's Revolving Credit Commitment hereunder. The initial amount of each
Lender's Commitment is set forth on Schedule I, or in the Assignment and
Acceptance pursuant to which such Lender shall have assumed its Commitment, as
applicable. The "Commitments" shall mean the aggregate amounts of all Lenders'
commitments to make Loans and to acquire participations in Letters of Credit
hereunder; the initial amount of the Commitments is Fifty Million Dollars
($50,000,000).
"Compliance Certificate" means a certificate of a Financial Officer as
described in Section 5.01(c).
"Consolidated" or "Consolidated Basis" means, except as otherwise
specifically provided for in this Agreement, the consolidation of the accounts
of Technologies and all of its direct and indirect Subsidiaries, including the
Borrower, in accordance with GAAP, including principles of consolidation.
"Consolidated Adjusted EBITDA" means, for any period, the sum of the
following on a Consolidated basis: (a) Consolidated Net Income for such period,
plus (b) without duplication and to the extent deducted in computing such
Consolidated Net Income for such period, the sum of (i) Consolidated Cash
Interest Expense, plus (ii) income tax expense, plus (iii) depreciation and
amortization expense, plus (iv) amortization or write-off of debt discount and
debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness (including the Loans), plus (v) amortization of
intangibles (including, but not limited to, goodwill) and organization costs,
plus (vi) any extraordinary, unusual or non-recurring expenses or losses
(including, whether or not otherwise includable as a separate item in such
Consolidated Net Income for such period, (A) losses on sales of assets outside
of the ordinary course of business and (B) actual restructuring charges deducted
by the Borrower in fiscal year 2005 and
5
2006 not to exceed $12,000,000.00 and $5,000,000.00 in the aggregate,
respectively) determined in accordance with GAAP, plus (vii) any other non-cash
charges, and minus (c) to the extent included in computing such Consolidated Net
Income for such period, the sum of (i) any extraordinary, unusual or
nonrecurring income or gains (including, whether or not otherwise includable as
a separate item in such Consolidated Net Income for such period, gains on the
sales of assets outside of the ordinary course of business) determined in
accordance with GAAP, plus (ii) any other non-cash income.
"Consolidated Fixed Charges" means, for any period, the sum of the
following on a Consolidated basis: (a) capital expenditures (minus Expansion
Capital Expenditures), plus (b) Cash Interest Expense, plus (c) all regularly
scheduled repayments of principal of Indebtedness (including principal
repayments of any Capital Lease Obligations), minus, (d) for such period, the
cost of financing any capital expenditures described in clause (a) of this
definition for such period.
"Consolidated Funded Debt" means, at any time, the sum of the following
(without duplication and in accordance with GAAP) on a Consolidated basis: (a)
all interest-bearing Indebtedness; plus (b) Capital Lease Obligations; plus (c)
synthetic lease obligations minus (d) cash, cash equivalents and investments of
the Borrower with a maturity not exceeding one (1) year.
"Consolidated Net Income" means, for any period, the Net Income (or net
loss) of the Borrower and the Guarantors on a consolidated basis provided that
there shall be excluded (a) the income (or deficit) of any Person accrued prior
to the date it becomes a Subsidiary or is merged into or consolidated with the
Borrower, (b) the income (or deficit) of any Person in which the Borrower has an
ownership interest, except to the extent that any such income has been actually
received by the Borrower in the form of dividends, or similar distributions, (c)
the undistributed earnings of the Borrower to the extent that the declaration or
payment of dividends or similar distributions by the Borrower and such
Subsidiary is not at the time permitted by the terms of its charter of any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to the Borrower, (d) any aggregate net after tax gain or
net after tax loss during such period arising from the sale, exchange or other
disposition of capital assets (such term to include all fixed assets, whether
tangible or intangible, all Inventory sold in conjunction with the disposition
of fixed assets, and all securities), (e) any write-up of any asset, (f) any net
gain from the collection of the proceeds of life insurance polices, (g) any gain
arising from the acquisition of any securities, or the extinguishment, under
GAAP, of any Indebtedness, of the Borrower, (h) any after tax gain or loss
during such period from any change in accounting, from any discontinued
operations or the disposition thereof, from any extraordinary events or from any
prior period adjustments, (i) in the case of a successor to the Borrower by
consolidation or merger or as a transferee of its assets, any earnings of the
successor corporation prior to such consolidation, merger or transfer of assets.
"Control" and "Controlling" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlled" has the correlative meaning to such terms.
6
"Credit Exposure" means, with respect to a Lender, at any time, such
Lender's Revolving Credit Exposure at such time.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings disclosed in
Schedule III and the environmental matters disclosed in Schedule IV.
"Dollars" or "$" refers to lawful money of the United States of America.
"Effective Date" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"Eligible Assignee" means (a) an Affiliate of any Lender; (b) an Approved
Fund; and (c) any other Person (other than a natural person) approved by the
Borrower (such approval not to be unreasonably withheld or delayed); provided
that no such approval shall be required if an Event of Default has occurred and
is continuing.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment, or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other than
an event for which the 30-day notice period is waived), (b) the existence with
respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived, (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan, (d)
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the incurrence by the Borrower or any of its ERISA Affiliates of any liability
under Title IV of ERISA with respect to the termination of any Plan, (e) the
receipt by the Borrower or any ERISA Affiliate from the PBGC of any notice
relating to an intention to terminate any Plan or Plans or to appoint a trustee
to administer any Plan, (f) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial withdrawal
from any Multiemployer Plan, or (g) the receipt by the Borrower or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Event of Default" has the meaning assigned to such term in ARTICLE VII.
"Eurocurrency Reserve Rate" means, for any Interest Period, a fraction
(expressed as a decimal) the numerator of which is the number one (1) and the
denominator of which is the number one (1) minus the arithmetic mean, taken over
each day in such Interest Period, of the aggregate of the maximum reserve
percentages established by the Board (including any marginal, special, emergency
or supplemental reserves) expressed as a decimal to which the Administrative
Agent is subject for "Eurocurrency Liabilities" (as that term is used in
Regulation D of the Board). ALR Loans shall be deemed to constitute
"Eurocurrency Liabilities" and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation. The Eurocurrency Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage for "Eurocurrency Liabilities".
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Issuing Lender or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.16(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement or is attributable to such Foreign Lender's failure or
inability (other than as a result of a Change in Law) to deliver documentation
prescribed by applicable law that permits payments made to such Foreign Lender
to be made without holding taxes, except to the extent that such Foreign
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.14(a).
"Expansion Capital Expenditures" means the actual amount of capital
expenditures in connection with the expansion of the Borrower's facility located
in Alden, New York and the facility in Tijuana, Mexico operated by the
Borrower's Affiliate Greatbatch Technologias de Mexico, S. de. C.V. in fiscal
year 2005 and fiscal year 2006 not to exceed $15,000,000 and $5,000,000 in the
aggregate, respectively.
8
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next one hundredth (1/100th) of one
percent (1%)) of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as published on
the next succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next one hundredth (1/100th) of one
percent (1%)) of the quotations for such day for such transactions received by
the Administrative Agent from three Federal funds brokers of recognized standing
selected by it.
"Financial Officer" means the chief financial officer, treasurer or vice
president-finance of the Borrower.
"Fixed Charges Coverage Ratio" means the ratio of Consolidated Adjusted
EBITDA to Consolidated Fixed Charges as at the end of each fiscal quarter and
measured for the four (4) consecutive fiscal quarters ending on the last day of
such fiscal quarter; provided, the items contained in clauses (a) and (d) of the
definition of Consolidated Fixed Charges as at the end of any fiscal quarter
shall be measured for the four (4) consecutive fiscal quarters ending on the
last day of such fiscal quarter. The determination of the Fixed Charges Coverage
Ratio shall be based upon the Consolidated financial statements delivered
pursuant to Section 5.01(a) or 5.01(b), as applicable.
"Foreign Lender" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"GAAP" means generally accepted accounting principles in the United States
of America.
"Governmental Authority" means the government of the United States of
America, or of any other nation, or any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Greatbatch, LLC" means Greatbatch, LLC, a Delaware limited liability
company and wholly-owned Subsidiary of the Borrower.
"Guarantee" of or by any Person (the "guarantor") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment
9
thereof, (c) to maintain working capital, equity capital or any other financial
statement condition or liquidity of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other obligation; or (d) as an
account party in respect of any letter of credit or letter of guaranty issued to
support such Indebtedness or obligation; provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business.
"Guarantor" and "Guarantors" means, individually and collectively, each
Parent Guarantor and each Subsidiary Guarantor.
"Guaranty Agreement" and "Guaranty Agreements" means, individually and
collectively, (i) the Subsidiary Guaranty executed and delivered to the
Administrative Agent by each of Greatbatch, LLC and Laboratories on the date
hereof, (ii) each Subsidiary Guaranty executed and delivered to the
Administrative Agent by each of the Borrower's Subsidiary Guarantors (other than
Greatbatch, LLC and Laboratories) prior to the date of this Agreement and (iii)
each Parent Guaranty executed and delivered to the Administrative Agent by each
of Holdings and Technologies dated as of January 12, 2001, as any such agreement
may be modified, amended or supplemented from time to time.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyl's, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Agreement" means any interest rate protection agreement, foreign
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging arrangement.
"Hittman Pledge Agreement" refers to the Subsidiary Pledge Agreement dated
as of June 18, 2001 pursuant to which Greatbatch-Hittman, Inc. has pledged to
the Administrative Agent (on behalf of the Lenders) all issued and outstanding
securities of Greatbatch Sierra, Inc., to secure the payment of any and all
Indebtedness and liabilities, whether now existing or hereafter incurred, of the
Borrower or of Greatbatch-Hittman, Inc. to the Administrative Agent and the
Lenders.
"Holdings" means WGL Intermediate Holdings, Inc., a Delaware corporation
and the owner of all of the issued and outstanding capital stock of the
Borrower.
"Indebtedness" of any Person means, without duplication (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed,
10
(g) all Guarantees by such Person of Indebtedness of others, (h) all Capital
Lease Obligations of such Person, (i) all obligations, contingent or otherwise,
of such Person as an account party in respect of letters of credit and letters
of guaranty, and (j) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances. The Indebtedness of any Person shall include
the Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as a
result of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide that such
Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indemnitee" has the meaning assigned to such term in Section 9.03(b).
"Intellectual Property Security Agreements" refers to the Patent Security
Agreements, Trademark Security Agreements and Copyright Security Agreements
executed and delivered to the Administrative Agent by the Borrower and each
Subsidiary, as the same may be modified, amended or supplemented from time to
time.
"Interest Election Request" means a request by the Borrower to convert a
Borrowing to, or continue a Borrowing as an ABR Borrowing or ALR Borrowing in
accordance with Section 2.06.
"Interest Payment Date" means (a) with respect to any ABR Loan, the first
day of each calendar month, and (b) with respect to any ALR Loan, the next
Business Day immediately following the last day of each Interest Period
therefor.
"Interest Period" means, (a) for any ALR Loan or ALR Borrowing, the period
commencing on the date of such Loan, or with respect to such Borrowing, the date
specified in the applicable Interest Election Request as the commencement date
of the Interest Period for such Borrowing, and ending on the numerically
corresponding day in the calendar month that is one (1), two (2), three (3) or
six (6) months thereafter, or (b) with respect to any portion of any ALR Loan or
Borrowing that is scheduled to be repaid on the Revolving Credit Commitment
Termination Date, a period of less than one (1) month's duration commencing on
the date of such Loan, or with respect to such Borrowing, the date specified in
the applicable Interest Election Request as the commencement date of the
Interest Period for such Borrowing, and ending on the Revolving Credit
Commitment Termination Date, as applicable; provided that (i) if any Interest
Period would end on a day other than a Business Day, such Interest Period shall
be extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest
Period shall end on the immediately preceding Business Day, and (ii) any
Interest Period (other than an Interest Period pertaining to an ALR Borrowing
that ends on the Revolving Credit Commitment Termination Date, as applicable,
that is permitted to be of less than one (1) month's duration as provided in
this definition) that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Revolving Credit Loan initially shall be the date on which such Loan is
made and thereafter shall be the effective date of the most recent conversion or
continuation of such Loan as an ALR Loan, and the date of a Borrowing comprising
a Revolving Credit Loan, multiple Revolving Credit Loans, or any portion of a
Revolving Credit Loan or Revolving Credit Loans, that has or have, respectively,
been converted or continued shall be the effective date of the most recent
conversion or continuation of such Loan, Loans or portion thereof.
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"Issuing Lender" means M&T, in its capacity as the issuer of Letters of
Credit hereunder, and its successors in such capacity as provided in Section
2.04(j).
"Laboratories" means Greatbatch Technologies Advanced Research
Laboratories, Inc., a Delaware corporation and Subsidiary of the Borrower.
"LC Disbursement" means a payment made by the Issuing Lender pursuant to a
Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
amounts of all outstanding Letters of Credit at such time, plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule I and any other Person that
shall have become a party hereto pursuant to an Assignment and Acceptance, other
than any such Person that ceases to be a party hereto pursuant to an Assignment
and Acceptance.
"Letter of Credit" means any standby letter of credit issued pursuant to
this Agreement.
"Letter of Credit Documents" means, with respect to any Letter of Credit,
collectively, any application therefor and any other agreements, instruments,
guarantees or other documents (whether general in application or applicable only
to such Letter of Credit) governing or providing for (a) the rights and
obligations of the parties concerned or at risk with respect to such Letter of
Credit, or (b) any collateral security for any of such obligations, each as the
same may be modified and supplemented and in effect from time to time.
"Leverage Ratio" means the ratio of (a) Consolidated Funded Debt, as at
the end of each fiscal quarter, to (b) Consolidated Adjusted EBITDA as at the
end of each fiscal quarter, and measured for the four (4) consecutive fiscal
quarters ending on the last day of such fiscal quarter. The determination of the
Leverage Ratio shall be based upon the Consolidated financial statements
delivered pursuant to Section 5.01(a) or 5.01(b), as applicable.
"LIBOR" means for any Interest Period, the per annum rate at which the
United States Dollar deposits are offered on page 3750 of the Dow Jones Markets
Telerate or as determined by the Administrative Agent if such information is not
available from any broker, quoting service or commonly available source utilized
by the Administrative Agent, at which United States Dollar deposits in
immediately available funds are offered to leading banks in the London interbank
deposit market at 11:00 a.m. Greenwich Mean Time (or as soon thereafter as
practicable) on the Quotation Date for delivery on the first day of such
Interest Period and for a period equal to such Interest Period.
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"Lien" means, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, hypothecation, encumbrance, charge or security interest in, on or
of such asset, (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any of the foregoing)
relating to such asset, and (c) in the case of securities, any purchase option,
call or similar right of a third party with respect to such securities.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Letter of Credit Documents, the Guaranty Agreements, the Security Agreements,
the Borrower Pledge Agreement, Hittman Pledge Agreement, the Intellectual
Property Security Agreements, the Reaffirmation Agreement and all other
agreements, documents, certificates and instruments executed and delivered by
the Borrower, any Subsidiary Guarantor, Technologies, Holdings, Greatbatch LLC,
Laboratories, and any other Person pursuant to the terms hereof to the
Administrative Agent and/or the Lenders in connection with the Transactions, as
each of such Loan Documents may be modified, amended or supplemented from time
to time.
"Loans" means the Revolving Credit Loans made by the Lenders to the
Borrower pursuant to this Agreement.
"Local Time" means the local time in Buffalo, New York.
"M&T" means Manufacturers and Traders Trust Company.
"Margin Stock" means "margin stock" within the meaning of Regulations T, U
and X of the Board.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, operations or condition, financial or otherwise, of the
Borrower and its Subsidiaries taken as a whole, (b) the ability of the Borrower
to perform any of its obligations under this Agreement or any of the other Loan
Documents, or (c) the ability of the Lenders to enforce or assert any right or
interest granted to the Lenders under this Agreement or any of the other Loan
Documents.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"Net Income" of any Person, means, with respect to any period, all amounts
which, in conformity with GAAP, would be included under net income on an income
statement of such Person for such period.
"Note" and "Notes" means, individually and collectively, the Revolving
Credit Note.
"Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.
"Parent Guarantor" and "Parent Guarantors" means, individually and
collectively, Technologies, Holdings and each Person in relation to which the
Borrower or any Subsidiary of the Borrower becomes a Subsidiary and that has
executed and delivered to the Administrative Agent a Guaranty Agreement as
provided in Section 5.05.
13
"Participant" has the meaning set forth 9.04(c).
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Acquisition" has the meaning set forth in Section 6.03.
"Permitted Investments" means: (a) direct obligations of, or obligations
the principal of and interest on which are unconditionally guaranteed by, the
United States of America (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of acquisition
thereof; (b) investments in commercial paper maturing within two hundred seventy
(270) days from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from Standard & Poor's Ratings
Services or Moody's Investors Services, Inc; (c) investments in certificates of
deposit, banker's acceptances and time deposits maturing within one year from
the date of acquisition thereof issued or guaranteed by or placed with, and
money market deposit accounts issued or offered by, any domestic office of any
commercial bank organized under the laws of the United States of America or any
State thereof which has a combined capital and surplus and undivided profits of
not less than Two Hundred Fifty Million Dollars ($250,000,000); and (d) fully
collateralized repurchase agreements with a term of not more than thirty (30)
days for securities described in clause (a) of this definition and entered into
with a financial institution satisfying the criteria described in clause (c) of
this definition.
"Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
"Plan" means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 302 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
"Prime Rate" means the rate of interest per annum publicly announced from
time to time by M&T as its prime rate in effect at its principal office in
Buffalo, New York; each change in the Prime Rate shall be effective from and
including the date such change is publicly announced as being effective.
"Quarterly Dates" means the last Business Day of March, June, September
and December in each year, the first of which shall be the first such day after
the date hereof.
"Quotation Date" means, for any Interest Period, the date that is two (2)
Business Days prior to the first day of such Interest Period.
"Reaffirmation Agreement" has the meaning set forth in Section 4.01(f).
14
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Credit Exposures and
unused Revolving Credit Commitments representing greater than sixty six and two
thirds percent (66 2/3%) of the sum of the total Credit Exposures and unused
Revolving Credit Commitments at such time.
"Restricted Payment" for any Person means (a) any dividend or other
distribution (whether in cash, securities or other property) with respect to any
shares of any class of capital stock of such Person, or (b) any payment (whether
in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such shares of capital stock of such Person
or any option, warrant or other right to acquire any such shares of capital
stock of such Person, or (c) any dividend, distribution or other payment by such
Person or any Subsidiary of such Person to any shareholder of such Person or
such Subsidiary (other than such Person), or to any Affiliate of such Person,
any of its Subsidiaries, or to such shareholder, whether in cash, securities or
other property.
"Revolving Credit Commitment" means, with respect to a Lender, the
commitment of such Lender to make Revolving Credit Loans and to acquire
participations in Letters of Credit hereunder, expressed as an amount
representing the maximum aggregate amount of such Lender's Revolving Credit
Exposure hereunder and its Applicable Percentage of the unused principal amount
of the Revolving Credit Note, as such commitment may be (a) reduced from time to
time pursuant to Section 2.07, and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender's Revolving Credit Commitment is set forth on
Schedule I, or in the Assignment and Acceptance pursuant to which such Lender
shall have assumed its Commitment, as applicable. The "Revolving Credit
Commitments" shall mean the aggregate amounts of all Lenders' commitments to
make Revolving Credit Loans and to acquire participations in Letters of Credit
hereunder; the amount of the Revolving Credit Commitments is Fifty Million
Dollars ($50,000,000.00).
"Revolving Credit Commitment Termination Date" means, with respect to the
Revolving Credit Loans, Revolving Credit Note and the Letters of Credit, May 30,
2008.
"Revolving Credit Exposure" means, with respect to any Lender at any time,
the sum of the outstanding principal amount of such Lender's Revolving Credit
Loans and its LC Exposure at such time.
"Revolving Credit Facility" means the credit extended to the Borrower as
described in Section 2.01.
"Revolving Credit Loan" and "Revolving Credit Loans" means, individually
and collectively, each Loan and each Swingline Loan made by the Lenders pursuant
to Section 2.01.
15
"Revolving Credit Note" means the Replacement Revolving Credit Notes
executed and delivered by the Borrower to the Administrative Agent pursuant to
Section 2.01 and in the form of Exhibit C hereto, and all substitutions and
replacements thereof.
"Security Agreement" and "Security Agreement" means, individually and
collectively, (i) the Subsidiary Security Agreements executed and delivered to
the Administrative Agent on the date hereof by Greatbatch, LLC and Laboratories,
(ii) each Subsidiary Security Agreement executed and delivered to the
Administrative Agent by each Subsidiary (other than Greatbatch, LLC and
Laboratories) and (iii) the Borrower Security Agreement executed and delivered
to the Administrative Agent by the Borrower and dated as of January 12, 2001, as
any such agreement may be modified, amended or supplemented from time to time.
"Senior Executive Officer" with respect to any Person, means the Chief
Executive Officer, President or Executive Vice President of such Person.
"Subordinated Indebtedness" means, with respect to the Borrower and its
Subsidiaries, all unsecured Indebtedness that is subordinated in right of
payment to the payment of the Loans and is otherwise junior to the rights of the
Lenders with respect to the Loans in all respects.
"Subsidiary" means, with respect to any Person (the "parent") at any date,
any corporation, limited liability company, partnership, association or other
entity the accounts of which would be consolidated with those of the parent in
the parent's consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than
fifty percent (50%) of the equity or more than fifty percent (50%) of the
ordinary voting power or, in the case of a partnership, more than fifty percent
(50%) of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, otherwise Controlled, by
the parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent. Unless otherwise specified, "Subsidiary" means
a Subsidiary of the Borrower.
"Subsidiary Guarantor" and "Subsidiary Guarantors" means, individually and
collectively, each Subsidiary of the Borrower or of any Subsidiary of the
Borrower that has executed and delivered to the Administrative Agent a
Subsidiary Guaranty in form acceptable to the Administrative Agent.
"Swingline Lender" means M&T, in its capacity as the issuer of Swingline
Loans hereunder, and its successors in such capacity as provided in Section
2.03(g).
"Swingline Loan" and "Swingline Loans" means, individually and
collectively, each Loan made by the Swingline Lender and the other Lenders under
the Revolving Credit Facility pursuant to Section 2.03.
"Technologies" means Greatbatch, Inc. (formerly Wilson Greatbatch
Technologies, Inc., a Delaware corporation and the owner of all of the issued
and outstanding capital stock of Holdings.
16
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement and the other Loan Documents, the borrowing of Loans,
the use of the proceeds thereof and the issuance of Letters of Credit hereunder.
"Type" when used in reference to any Loan or Borrowing, refers to whether
the rate of interest on such Loan, or on the Loans constituting such Borrowing,
is determined by reference to the Adjusted LIBOR or the Adjusted Base Rate, and,
accordingly, whether such Loan or Borrowing is an ALR Loan or Borrowing or ABR
Loan or Borrowing, respectively.
"USA Patriot Act" means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act)
Act of 2001.
"Withdrawal Liability" means liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.
1.02 Terms Generally. The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
1.03 Accounting Terms; GAAP.
(a) GAAP; Changes in Accounting Terms Treatment. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
17
(b) Changes in Fiscal Periods. To enable the ready and consistent
determination of compliance with the covenants set forth in Section ARTICLE VI,
the Borrower will not change the last day of its fiscal year from the Friday
nearest to December 31 of each year (whether or not such last day occurs in the
same calendar year or the next following calendar year), or the last days of the
first three fiscal quarters in each of their fiscal years from the Friday
closest to March 31, June 30 or September 30 of each year, respectively. By way
of illustration of the foregoing, fiscal year 2005 will end on December 30,
2005.
(c) Pro Forma Treatment of Acquisitions. For the purposes of computing
Consolidated Adjusted EBITDA, Consolidated Fixed Charges, Cash Interest Expense,
Consolidated Funded Debt, the Fixed Charges Coverage Ratio and the Leverage
Ratio (and any financial calculations required to be made or included within
such amounts or ratios) as of the end of any measurement period, in the event
any Person (an "acquired Person") is acquired by the Borrower or any of its
Subsidiaries after the beginning of and prior to the end of such measurement
period, all components of such amounts or ratios (other than capital
expenditures as determined in accordance with GAAP) shall be computed on a pro
forma basis as if such acquisition has occurred on the first day of such
measurement period, and shall, without duplication, and to the extent
applicable:
(i) include, for purposes of calculating Consolidated Adjusted
EBITDA, the actual items of income and expense of the acquired Person as
measured for the four (4) consecutive fiscal quarters of such acquired
Person ending on the date of its acquisition by the Borrower or such
Subsidiary;
(ii) include, for purposes of calculating Consolidated Fixed
Charges, the actual items of fixed charges of the acquired Person as
measured for the four (4) consecutive fiscal quarters of such acquired
Person ending on the date of its acquisition by the Borrower or such
Subsidiary;
(iii) include, for purposes of determining Cash Interest Expense,
the actual items of cash interest expense of the acquired Person as
measured for the four (4) consecutive fiscal quarters of such acquired
Person ending on the date of its acquisition by the Borrower or such
Subsidiary;
(iv) include, for the purposes of determining Consolidated Funded
Debt, the actual amount of all interest-bearing Indebtedness, Capital
Lease Obligations and synthetic lease obligations of the acquired entity
as at the date of its acquisition by the Borrower or such Subsidiary;
(v) exclude any Indebtedness of the acquired Person that has been
retired or discharged on or prior to the date the Borrower or such
Subsidiary acquired such acquired Person (the "acquisition date");
18
(vi) calculate interest payable during such measurement period with
respect to any Indebtedness of such acquired Person at a rate of interest
equal to the actual weighted average interest rate in effect for the Loans
hereunder on the date of such acquisition; and
(vii) include all cost savings to be realized by the Borrower or
such Subsidiary in connection with such acquisition during the twelve (12)
month period ending on the first (1st) anniversary of the acquisition
date, as determined in good faith by the Borrower or such Subsidiary and
set forth in the relevant Compliance Certificate delivered by the
Financial Officer of the Borrower for such measurement period
(collectively, the "projected cost savings"); provided, however, in
computing each such amount or ratio (A) no cost savings which would accrue
or occur after the first (1st) year anniversary of the acquisition date
shall be considered, and (B) the actual cost savings realized by the
Borrower or such Subsidiary (if any) during each measurement period
commencing after the end of the measurement period containing the
acquisition date, rather than the projected cost savings expected to be
realized during such measurement period, shall (to the extent applicable)
be used in computing each such amount or ratio as of the end of such
measurement period.
ARTICLE II THE CREDIT FACILITY
2.01 Revolving Credit Facility.
(a) Revolving Credit Commitments. Each Lender severally agrees to make
Revolving Credit Loans to the Borrower from time to time during the Availability
Period in an aggregate principal amount that will not result in (i) such
Lender's Revolving Credit Exposure exceeding such Lender's Revolving Credit
Commitment, or (ii) the total Revolving Credit Exposures exceeding the total
Revolving Credit Commitments. Each Lender's Revolving Credit Commitment is set
forth opposite such Lender's name on Schedule I or in the Assignment and
Acceptance pursuant to ---------- which such Lender shall have assumed its
Commitment, as applicable. Within the foregoing limits and subject to the terms
and conditions set forth herein, the Borrower may borrow, prepay and re-borrow
Revolving Credit Loans.
(b) Obligations of Lenders for Revolving Credit Loans. Each Revolving
Credit Loan shall be made on the date of such Borrowing by the Lenders ratably
in accordance with their respective Applicable Percentages. The failure of any
Lender to make any Revolving Credit Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided that the
Revolving Credit Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Revolving Credit Loans as
required hereunder.
(c) Type of Revolving Credit Loans. Each Borrowing of Revolving Credit
Loans shall be constituted entirely of ABR Loans or of ALR Loans as the Borrower
may request in accordance herewith. Subject to the provisions of Section 2.11,
the Borrower may elect to change the Type of any Borrowing of Revolving Credit
Loans after the Effective Date in accordance with the provisions of Section
2.06.
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(d) Revolving Credit Note. The Revolving Credit Loans, and the Borrower's
obligation to repay the Revolving Credit Loans and interest thereon, shall be
evidenced by the Revolving Credit Note executed and delivered to the
Administrative Agent on the Effective Date, and shall be in the form of Exhibit
C hereto. Interest on the outstanding and unpaid principal amount of the
Revolving Credit Note will be payable from the date of the Revolving Credit Note
as hereinafter provided, and the entire unpaid principal amount of the Revolving
Credit Note shall be repaid on the Revolving Credit Commitment Termination Date.
(e) Records of the Administrative Agent. The Administrative Agent shall
set forth on a schedule attached to and made a part of each Revolving Credit
Note or on any separate similar schedule or on any continuation of any such
schedule (including, but not limited to, any similar schedule maintained in
computerized records) annotations evidencing (i) the date and principal amount
of each Revolving Credit Loan, (ii) the aggregate of all principal amounts of
all Revolving Credit Loans, (iii) the amounts of any repayments of principal of
the Revolving Credit Loans, (iv) the outstanding principal amount of each
Revolving Credit Note, (v) the applicable Interest Period for each Borrowing
that is an ALR Borrowing (vi) the Applicable Margin and resulting interest rate
for each Borrowing of Revolving Credit Loans, (vii) the aggregate amounts of all
payments under or repayments of principal of each Revolving Credit Note, and
(viii) and such other information relating to each Revolving Credit Note, the
Revolving Credit Loans, principal amounts thereof, interest paid or payable
thereon, or otherwise as the Administrative Agent shall deem appropriate in the
Administrative Agent's sole discretion. Each such annotation shall, in the
absence of manifest error, be conclusive and binding upon the Borrower. No
failure of the Administrative Agent to make and no error by the Administrative
Agent in making any annotation on such attached schedule or any such similar
schedule shall affect the obligations of the Borrower to repay the principal
amount of each Revolving Credit Loan and the outstanding principal amount of
each Revolving Credit Note, the obligation of the Borrower to pay interest on
the outstanding principal amount of each Revolving Credit Loan and on the
outstanding principal amount of each Revolving Credit Note, or any other
obligation of the Borrower to the Administrative Agent or any Lender pursuant to
this Agreement.
2.02 Requests for Loans.
(a) Notice by the Borrower. To request a Borrowing, the Borrower shall
notify the Administrative Agent of such request by telephone (i) in the case of
an ALR Borrowing, not later than 11:00 a.m., Local Time, three (3) Business Days
before the date of the proposed Borrowing, or (ii) in the case of an ABR
Borrowing (including an ABR Borrowing to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.04(f)), not later than 11:00 a.m.,
Local Time, on the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Borrowing Request
in the form of Exhibit D hereto and ---------- signed by the Borrower on or
prior to the date of such Borrowing as required pursuant to the foregoing.
(b) Content of Borrowing Requests. Each telephonic and written Borrowing
Request shall specify the following information in compliance with Section 2.01:
(i) the aggregate amount of the requested Borrowing;
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(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or an ALR
Borrowing; and
(iv) in the case of an ALR Borrowing, the Interest Period therefor,
which shall be a period contemplated by the definition of the term
"Interest Period" and permitted under Section 2.06(g).
(c) Minimum Amounts of Borrowings. Each ALR Borrowing under the Revolving
Credit Facility shall be in an aggregate amount equal to Two Million Dollars
($2,000,000) or a larger multiple of Two Hundred Fifty Thousand Dollars
($250,000). Each ABR Borrowing under the Revolving Credit Facility shall be in
an aggregate amount equal to Five Hundred Thousand Dollars ($500,000) or a
larger multiple of Two Hundred Fifty Thousand Dollars ($250,000); provided that
an ABR Borrowing under the Revolving Credit Facility may be in an aggregate
amount that is equal to the entire unused balance of the total Revolving Credit
Commitments or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.04(f).
(d) Notice by the Administrative Agent to the Lenders. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Revolving Credit Loan to be made as part of the
requested Borrowing.
(e) Failure to Elect. If the Borrower fails to elect the Type of a
requested Borrowing, then the requested Borrowing shall be an ABR Borrowing. If
no Interest Period is specified with respect to any requested ALR Borrowing, the
requested Borrowing shall be made instead as an ABR Borrowing.
2.03 Requests for Swingline Loans.
(a) Notice by the Borrower. Notwithstanding the provisions of Section
2.02, above, the Borrower may from time to time request the Swingline Lender to
consider making a Swingline Loan to the Borrower. In order to request a
Swingline Loan the Borrower shall notify the Administrative Agent of such
request by telephone not later than 3:00 p.m., Local Time, on the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent and Swingline Lender of a written Borrowing Request in the
form of Exhibit D hereto and signed by the ---------- Borrower on the date of
such Borrowing. Each telephonic and written Borrowing Request shall specify the
following information in compliance with Section 2.02: (i) the principal amount
of such Swingline Loan, and (ii) the aggregate amount of Swingline Loans
outstanding, both before and after giving effect to such Swingline Loan, and
(iii) the date of such Swingline Loan, which shall be a Business Day.
(b) Determination by Swingline Lender. Any decision to make a Swingline
Loan to the Borrower shall be in the sole and absolute discretion of the
Swingline Lender, and the Swingline Lender shall review each request for a
Swingline Loan on a case-by-case basis.
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The Swingline Lender shall not make a Swingline Loan if it has actual notice, or
has received notice from the Administrative Agent, any Lender or the Borrower,
that an Event of Default has occurred and is continuing. Other than instances in
which the Swingline Lender has actual notice, or has received notice from the
Administrative Agent, any Lender or the Borrower, that an Event of Default has
occurred and is continuing, in the event the Swingline Lender does not approve
Borrower's request for a Swingline Loan, the Borrowing Request delivered to the
Administrative Agent and Swingline Lender requesting a Swingline Loan shall be
treated as a Borrowing Request for an ABR Loan pursuant to the provisions of
Section 2.02, above, and such requested Loan's borrowing date shall be deemed to
be the earliest date for borrowing an ABR Loan following delivery of such
Borrowing Request to the Administrative Agent pursuant to such Section. This
Agreement does not constitute a commitment, and the Swingline Lender shall not
have any obligation, to make any Swingline Loan.
(c) Limitations on Amounts. Each Swingline Loan shall be in an amount of
not less than Fifty Thousand Dollars ($50,000) and, if in an amount greater than
Fifty Thousand Dollars ($50,000), shall be in whole multiples of Ten Thousand
Dollars ($10,000). No Swingline Loan shall (i) individually be in an amount
greater than Five Hundred Thousand Dollars ($500,000), or (ii) either
individually or when aggregated with all other Swingline Loans, exceed the
lesser of (A) the amount of the Swingline Lender's Revolving Credit Commitment,
and (B) Two Million Five Hundred Thousand Dollars ($2,500,000).
(d) Notification by Swingline Lender. If, after receiving a Borrowing
Request with respect to a Swingline Loan, and upon the Borrower's fulfillment of
all applicable conditions set forth herein, the Swingline Lender elects to make
a Swingline Loan available to the Borrower, the Swingline Lender shall (i)
notify the Borrower by 4:00 p.m., Local Time, on the date of receipt of such
Borrowing Request, (ii) pay or deliver all funds so requested by the Borrower in
the Borrowing Request by the end of business on such date, and (iii) promptly
notify the Administrative Agent of such Swingline Loan.
(e) Notification by Administrative Agent. After receiving notice of a
Swingline Loan from the Swingline Lender, the Administrative Agent shall
promptly notify each Lender by telephone of such Swingline Loan and of such
Lender's Applicable Percentage of the principal amount of such Swingline Loan.
Each Lender (other than the Swingline Lender) shall, before 12:00 p.m.. (Eastern
Standard Time or Eastern Daylight Savings Time, as the case may be) on the
Business Day immediately following the date of a Swingline Loan, deposit with
the Administrative Agent the amount of such Lender's Applicable Percentage of
the principal amount of such Swingline Loan in immediately available funds.
After receipt by the Administrative Agent of such funds, the Administrative
Agent shall pay or deliver all funds so received to the order of the Swingline
Lender to the account designated by the Swingline Lender for the receipt of such
funds, and each amount paid by a Lender to the Administrative Agent for the
account of the Swingline Lender shall constitute such Lender 's Revolving Credit
Commitment with respect to such Swingline Loan for purposes of this Agreement
and the Revolving Credit Note.
(f) Discontinuance of Swingline Loans. Upon one (1) Business Day's written
notice to the Administrative Agent and the other Lenders, any Lender (including
the Swingline Lender) may elect to discontinue to honor any Borrowing Request
with respect to its Applicable Percentage of a Swingline Loan delivered to the
Swingline Lender and the Administrative Agent after such notice.
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In such event, the Administrative Agent and other Lenders shall elect to either
(i) terminate the availability of Swingline Loans to the Borrower after the date
of such notice, or (ii) negotiate with the Borrower an alternate method of
making Swingline Loans (or an equivalent form of credit) available to the
Borrower upon terms and conditions satisfactory to the Lenders.
(g) Replacement of the Swingline Lender. The Swingline Lender may be
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Swingline Lender and the successor Swingline Lender. The
Administrative Agent shall promptly notify the Lenders of any such replacement
of the Swingline Lender. From and after the effective date of any such
replacement, (i) the successor Swingline Lender shall have all the rights and
obligations of the replaced Swingline Lender under this Agreement with respect
to Swingline Loans to be issued thereafter, and (ii) references herein to the
term " Swingline Lender" shall be deemed to refer to such successor or to any
previous Swingline Lender, or to such successor and all previous Swingline
Lenders, as the context shall require. After the replacement of an Swingline
Lender hereunder, the replaced Swingline Lender shall cease to be a party hereto
and shall not have any right, duty or obligation hereunder to issue additional
Swingline Loans.
2.04 Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein, in
addition to the Revolving Credit Loans provided for in Section 2.01, the
Borrower may request the Issuing Lender to issue, at any time and from time to
time during the Availability Period, Letters of Credit for its own account in
such form as is acceptable to the Issuing Lender in its reasonable
determination. Letters of Credit issued hereunder shall constitute utilization
of the Revolving Credit Commitments.
(b) Notice of Issuance; Amendment; Renewal or Extension. To request the
issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or
transmit by electronic communication, if arrangements for doing so have been
approved by the Issuing Lender) to the Issuing Lender and the Administrative
Agent (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall be
a Business Day), the date on which such Letter of Credit is to expire (in
compliance with paragraph (d) of this Section), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. The Borrower also shall submit a letter of credit application on the
Issuing Lender's standard form in connection with any request for a Letter of
Credit. In the event of any inconsistency between the terms and conditions of
this Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by the Borrower to, or entered into by
the Borrower with, the Issuing Lender relating to any Letter of Credit, the
terms and conditions of this Agreement shall control.
(c) Limitations on Amounts. A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
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(i) the aggregate LC Exposure of the Issuing Lender (determined for these
purposes without giving effect to the participations therein of the Lenders
pursuant to paragraph (e) of this Section) shall not exceed Ten Million Dollars
($10,000,000.00), and (ii) the total Revolving Credit Exposures shall not exceed
the total Revolving Credit Commitments.
(d) Expiration Date. Each Letter of Credit shall expire at or prior to the
close of business ten (10) Business Days prior to the Revolving Credit
Commitment Termination Date.
(e) Participations. By the issuance of a Letter of Credit (or an amendment
to a Letter of Credit increasing the amount thereof) by the Issuing Lender, and
without any further action on the part of the Issuing Lender or the Lenders, the
Issuing Lender hereby grants to each Lender, and each Lender hereby acquires
from the Issuing Lender, a participation in such Letter of Credit equal to such
Lender's Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit. Each Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments. In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to
the Administrative Agent, for account of the Issuing Lender, such Lender's
Applicable Percentage of each LC Disbursement made by the Issuing Lender
promptly upon the request of the Issuing Lender at any time from the time of
such LC Disbursement until such LC Disbursement is reimbursed by the Borrower or
at any time after any reimbursement payment is required to be refunded to the
Borrower for any reason. Such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each such payment shall be made
in the same manner as provided in Section 2.05 with respect to Loans made by
such Lender (and Section 2.05 shall apply, mutatis mutandis, to the payment
obligations of the Lenders), and the Administrative Agent shall promptly pay to
the Issuing Lender the amounts so received by it from the Lenders. Promptly
following receipt by the Administrative Agent of any payment from the Borrower
pursuant to the next following paragraph, the Administrative Agent shall
distribute such payment to the Issuing Lender or, to the extent that the Lenders
have made payments pursuant to this paragraph to reimburse the Issuing Lender,
then to such Lenders and the Issuing Lender as their interests may appear. Any
payment made by a Lender pursuant to this paragraph to reimburse the Issuing
Lender for any LC Disbursement shall not constitute a Loan and shall not relieve
the Borrower of its obligation to reimburse such LC Disbursement.
(f) Reimbursement. If the Issuing Lender shall make any LC Disbursement in
respect of a Letter of Credit, the Borrower shall reimburse the Issuing Lender
in respect of such LC Disbursement by paying to the Administrative Agent an
amount equal to such LC Disbursement not later than 12:00 noon, Local Time, on
(i) the Business Day that the Borrower receives notice of such LC Disbursement,
if such notice is received prior to 10:00 a.m., Local Time, or (ii) the Business
Day immediately following the day that the Borrower receives such notice, if
such notice is not received prior to such time, provided that the Borrower may,
subject to the conditions to borrowing set forth herein, request in accordance
with Section 2.02 that such payment be financed with an ABR Borrowing in an
equivalent amount and, to the extent so financed, the Borrower's obligation to
make such payment shall be discharged and replaced by the resulting ABR
Borrowing. If the Borrower fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable LC Disbursement,
the payment then due from the Borrower in respect thereof and such Lender's
Applicable Percentage thereof.
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(g) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (f) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the Issuing Lender under a Letter of Credit against
presentation of a draft or other document that does not comply strictly with the
terms of such Letter of Credit, and (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of the
Borrower's obligations hereunder. Neither the Administrative Agent, the Lenders
nor the Issuing Lender, nor any of their Related Parties, shall have any
liability or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit by the Issuing Lender or any payment or failure
to make any payment thereunder (irrespective of any of the circumstances
referred to in the preceding sentence), or any error, omission, interruption,
loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Letter of Credit (including any document
required to make a drawing thereunder), any error in interpretation of technical
terms or any consequence arising from causes beyond the control of the Issuing
Lender; provided that the foregoing shall not be construed to excuse the Issuing
Lender from liability to the Borrower to the extent of any direct damages (as
opposed to consequential damages, claims in respect of which are hereby waived
by the Borrower to the extent permitted by applicable law) suffered by the
Borrower that are caused by the Issuing Lender's gross negligence or willful
misconduct when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that:
(i) the Issuing Lender may accept documents that appear on their
face to be in substantial compliance with the terms of a Letter of Credit
without responsibility for further investigation, regardless of any notice
or information to the contrary, and may make payment upon presentation of
documents that appear on their face to be in substantial compliance with
the terms of such Letter of Credit;
(ii) the Issuing Lender shall have the right, in its sole
discretion, to decline to accept such documents and to make such payment
if such documents are not in strict compliance with the terms of such
Letter of Credit; and
(iii) this sentence shall establish the standard of care to be
exercised by the Issuing Lender when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof
(and the parties hereto hereby waive, to the extent permitted by
applicable law, any standard of care inconsistent with the foregoing).
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(h) Disbursement Procedures. The Issuing Lender shall, within a reasonable
time following its receipt thereof, examine all documents purporting to
represent a demand for payment under a Letter of Credit. The Issuing Lender
shall promptly after such examination notify the Administrative Agent and the
Borrower by telephone (confirmed by telecopy) of such demand for payment and
whether the Issuing Lender has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse the Issuing Lender and the
Lenders with respect to any such LC Disbursement.
(i) Interim Interest. If the Issuing Lender shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement, in
full, on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Loans; provided that,
if the Borrower fails to reimburse such LC Disbursement when due pursuant to
paragraph (f) of this Section, then Section 2.10(c) shall apply. Interest
accrued pursuant to this paragraph shall be for account of the Issuing Lender,
except that interest accrued on and after the date of payment by any Lender
pursuant to paragraph (f) of this Section to reimburse the Issuing Lender shall
be for account of such Lender to the extent of such payment.
(j) Replacement of the Issuing Lender. The Issuing Lender may be replaced
at any time by written agreement among the Borrower, the Administrative Agent,
the replaced Issuing Lender and the successor Issuing Lender. The Administrative
Agent shall notify the Lenders of any such replacement of the Issuing Lender. At
the time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for account of the replaced Issuing Lender pursuant to
Section 2.09(b). From and after the effective date of any such replacement, (i)
the successor Issuing Lender shall have all the rights and obligations of the
replaced Issuing Lender under this Agreement with respect to Letters of Credit
to be issued thereafter, and (ii) references herein to the term "Issuing Lender"
shall be deemed to refer to such successor or to any previous Issuing Lender, or
to such successor and all previous Issuing Lenders, as the context shall
require. After the replacement of an Issuing Lender hereunder, the replaced
Issuing Lender shall remain a party hereto and shall continue to have all the
rights and obligations of an Issuing Lender under this Agreement with respect to
Letters of Credit issued by it prior to such replacement, but shall not be
required to issue additional Letters of Credit.
(k) Cash Collateralization. If either (i) an Event of Default shall occur
and be continuing and the Borrower receives notice from the Administrative Agent
or the Required Lenders (or, if the maturity of the Loans has been accelerated,
Lenders with LC Exposure representing greater than fifty one percent (51%) of
the total LC Exposure) demanding the deposit of cash collateral pursuant to this
paragraph, or (ii) the Borrower shall be required to provide cover for LC
Exposure pursuant to Section 2.08, the Borrower shall immediately deposit into
an account established and maintained on the books and records of the
Administrative Agent, which account may be a "securities account" (within the
meaning of Section 8-501 of the Uniform Commercial Code as in effect in the
State of New York), in the name of the Administrative Agent and for the benefit
of the Lenders, an amount in cash equal to, in the case of an Event of Default,
the LC Exposure as of such date plus any accrued and unpaid interest thereon
and, in the case of cover pursuant to Section 2.08, the amount required under
Section 2.08; provided that the obligation to deposit such cash collateral shall
become effective immediately,
26
and such deposit shall become immediately due and payable, without demand or
other notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (i) or (j) of ARTICLE VII. Such
deposit shall be held by the Administrative Agent as collateral for the LC
Exposure under this Agreement, and for this purpose the Borrower hereby grants a
security interest to the Administrative Agent for the benefit of the Lenders in
such collateral account and in any financial assets (as defined in the Uniform
Commercial Code as in effect in the State of New York) or other property held
therein.
2.05 Funding of Borrowings.
(a) Funding by Lenders. Each Lender shall make (i) each Loan to be made by
it hereunder on the proposed Borrowing Date thereof, and (ii) each Swingline
Loan to be made by it hereunder pursuant to the provisions of Section 2.03 on
the day immediately following such Loan's Borrowing Date, by wire transfer of
immediately available funds by 12:00 noon, Local Time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders. The Administrative Agent will make such Revolving Credit Loans
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower designated by the Borrower in the
applicable Borrowing Request; provided that ABR Borrowings made to finance the
reimbursement of an LC Disbursement as provided in Section 2.04(f) shall be
remitted by the Administrative Agent to the Issuing Lender.
(b) Presumption by the Administrative Agent. Unless the Administrative
Agent shall have received notice from a Lender (i) at least one (1) Business Day
prior to the proposed Borrowing Date of any Borrowing of a Loan, or (ii) by 4:00
p.m. on the day the Administrative Agent notifies such Lender of the Swingline
Lender's receipt of a Borrowing Request for a Swingline Loan, that such Lender
will not make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender (A) in the case
of a Loan, has made such share available on such Borrowing Date, and (B) in the
case of a Swingline Loan, will make such share available on the day immediately
following the Borrowing Date of such Loan, in accordance with paragraph (a) of
this Section, and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not so notified
the Administrative Agent and has not in fact made its share of the applicable
Borrowing available to the Administrative Agent, then the applicable Lender and
the Borrower severally agree to pay to the Administrative Agent forthwith on
demand such corresponding amount with interest thereon, for each day from and
including the date such amount is made available to the Borrower to but
excluding the date of payment to the Administrative Agent, at (y) in the case of
such Lender, the Federal Funds Effective Rate, or (z) in the case of the
Borrower, the interest rate then applicable to ABR Loans. If such Lender pays
such amount to the Administrative Agent, then such amount shall constitute such
Lender's Loan included in such Borrowing.
2.06 Interest Elections.
(a) Elections by the Borrower for Borrowings. The Loans constituting each
Borrowing initially shall be of the Type specified by the Borrower (i) with
respect to any Borrowing, as specified by the Borrower in the applicable
Borrowing Request, and (ii) and in the case of any portion of the Revolving
Credit Loans that is an ALR Borrowing shall have the Interest Period specified
by the Borrower in such Borrowing Request, respectively.
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Thereafter, the Borrower may elect to convert such Borrowing to a Borrowing of a
different Type or to continue such Borrowing as a Borrowing of the same Type
and, in the case of a ALR Borrowing, may elect the Interest Period therefor, all
as provided in this Section, and in form attached hereto as Exhibit E with
respect to a Borrowing (an "Interest Election Request for Revolving Credit
Borrowing"), respectively (each such request to be referred to as an "Interest
Election Request"). The Borrower may elect different options with respect to
different portions of any Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding the Loans constituting such
Borrowing, and the Loans constituting each such portion shall be considered a
separate Borrowing. Notwithstanding anything to the contrary herein, at no point
in time shall more than five (5) ALR Borrowings be outstanding, and any election
by the Borrower pursuant to Section 2.06 to continue or convert any Borrowing as
or to, as the case may be, an ALR Borrowing in excess of this limit shall be
treated by the Administrative Agent as an election by the Borrower to continue
or convert such Borrowing as or to, as the case may be, an ABR Borrowing.
(b) Interest on Swingline Loans. Notwithstanding anything to the contrary
contained herein, each Swingline Loan shall at all times bear interest at the
Adjusted Base Rate.
(c) Notice of Elections. To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.02 if the
Borrower were requesting a Borrowing of the Type resulting from such election to
be made on the effective date of such election. Each such telephonic interest
election request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request in the form of Exhibit E.
(d) Content of Interest Election Requests. Each telephonic and written
Interest Election Request shall specify the following information in compliance
with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, with respect to any Borrowing if different options are being elected
with respect to different portions thereof, the portions thereof to be
allocated to each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (iv) of this paragraph shall be
specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the Borrowing is to be an ABR Borrowing or an ALR
Borrowing; and
(iv) if the Borrowing is an ALR Borrowing, the Interest Period
therefor after giving effect to such election, which shall be a period
contemplated by the definition of the term "Interest Period" and permitted
under paragraph (g) of this Section.
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(e) Notice by the Administrative Agent to the Lenders. Promptly following
receipt of an Interest Election Request, the Administrative Agent shall advise
each Lender of the details thereof and of such Lender's portion of each
resulting Borrowing.
(f) Failure to Elect; Events of Default. If the Borrower fails to deliver
a timely and complete Interest Election Request with respect to an ALR Borrowing
prior to the end of the Interest Period therefor, then, unless such Borrowing is
repaid as provided herein, at the end of such Interest Period such Borrowing
shall be converted to an ABR Borrowing. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (A) no outstanding
Borrowing may be converted to an ALR Borrowing, and (B) unless repaid, each ALR
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period therefor.
(g) Limitations on Interest Periods. Notwithstanding any other provision
of this Agreement, the Borrower shall not be entitled to (i) request (or to
elect to convert to or continue as an ALR Borrowing) any Borrowing if the
Interest Period requested therefor would end after the Revolving Credit
Commitment Termination Date and (ii) the Borrower may not elect an ALR Borrowing
at any time where the approval of such election by the Lender would result in
there being more than five (5) interest rate tranches in effect at one time.
2.07 Termination and Reduction of the Commitments.
(a) Scheduled Termination. Unless previously terminated, the Revolving
Credit Commitments shall terminate on the Revolving Credit Commitment
Termination Date, and the obligations of the Lenders to make Revolving Credit
Loans shall terminate on such date.
(b) Voluntary Termination or Reduction. The Borrower may, at any time,
terminate, or from time to time reduce, the Revolving Credit Commitments;
provided that (i) each reduction of the Revolving Credit Commitments shall be in
an amount that is Five Million Dollars ($5,000,000.00) or a larger multiple of
Five Hundred Thousand Dollars ($500,000.00), and (ii) the Borrower shall not
terminate or reduce the Revolving Credit Commitments if, after giving effect to
any concurrent prepayment of the Revolving Credit Loans in accordance with
Section 2.08, the total Revolving Credit Exposures would exceed the total
Revolving Credit Commitments.
(c) Notice of Voluntary Termination or Reduction. The Borrower shall
notify the Administrative Agent of any election to terminate or reduce the
Revolving Credit Commitments under paragraph (b) of this Section at least three
(3) Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Lenders of the
contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Revolving
Credit Commitments delivered by the Borrower may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case
such notice may be revoked by the Borrower (by notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied.
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(d) Effect of Termination or Reduction. Any termination or reduction of
the Revolving Credit Commitments shall be permanent. Each reduction of the
Revolving Credit Commitments shall be made ratably among the Lenders in
accordance with their respective Revolving Credit Commitments.
2.08 Repayment and Prepayment of Loans; Evidence of Debt.
(a) Repayment. The Borrower hereby unconditionally promises to pay the
Loans as follows:
(i) to the Administrative Agent for account of the Lenders the
outstanding principal amounts of the Loans on the Revolving Credit
Commitment Termination Date, and
(ii) in addition to the amounts described immediately above, the
Borrower unconditionally promises to pay to the Administrative Agent for
the account of the Lenders, and for the account of the Issuing Lender, as
applicable, on the Revolving Credit Commitment Date, all accrued and
unpaid interest, all fees, costs and expenses, and all other amounts
payable on or in connection with the Loans and Letters of Credit.
(b) Prepayments.
(i) Prepayment. The Borrower shall have the right at any time and
from time to time prior to the Revolving Credit Commitment Termination
Date to prepay the Loans, in whole or in part, subject to the requirements
of this Section. Any prepayment of less than the outstanding principal
amount of the Loans shall be in a minimum aggregate principal amount of
Five Million Dollars ($5,000,000) or in a larger multiple of Two Hundred
Fifty Thousand Dollars ($250,000). Prepayments of the Loans made at any
time the Borrowing being repaid (in whole or in part) is (A) an ABR
Borrowing shall be without premium or penalty, and (B) an ALR Borrowing
shall be subject to the provisions of Section 2.13.
(ii) Manner of Prepayment; Notices; Etc. The Borrower shall notify
the Administrative Agent by telephone (confirmed by telecopy) of any
prepayment hereunder (A) in the case of a prepayment of an ALR Borrowing,
not later than 11:00 a.m., Local Time, three (3) Business Days before the
date of prepayment, and (B) in the case of prepayment of an ABR Borrowing,
not later than 11:00 a.m., Local Time, on the date of the proposed
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date, and the principal amount of each Borrowing (or portion
thereof) to be prepaid; provided that, if a notice of prepayment is given
in connection with a conditional notice of termination of the Revolving
Credit Commitments as contemplated by Section 2.07, then such notice of
prepayment may be revoked if such notice of termination is revoked in
accordance with Section 2.07. Promptly following receipt of any such
notice, the Administrative Agent shall advise the Lenders of the contents
thereof. Each prepayment of a Borrowing (or portion thereof) constituting
Loans (or a portion thereof, respectively) shall be applied ratably to
each Lender's Revolving Credit Commitment pursuant to Section 2.15.
Prepayments shall be accompanied by accrued interest to the extent
required by Section 2.10 and shall be made in the manner specified in
Section 2.15.
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(c) Maintenance of Records by Lenders. Each Lender shall maintain in
accordance with its usual practice records evidencing the indebtedness of the
Borrower to such Lender resulting from each Loan made by such Lender, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(d) Effect of Entries. The entries made in the records maintained pursuant
to paragraph (c) of this Section and Section 2.01(e), as applicable, shall be
prima facie evidence of the existence and amounts of the obligations recorded
therein; provided that the failure of any Lender or the Administrative Agent to
maintain such records or any error therein shall not in any manner affect the
obligation of the Borrower to repay the Loans in accordance with the terms of
this Agreement.
2.09 Fees.
(a) Revolving Credit Fees. The Borrower agrees to pay to the
Administrative Agent for account of each Lender revolving credit fees which
shall accrue at the Applicable Margin on the average daily unused amount of the
Revolving Credit Commitment of such Lender during the period from and including
the date hereof to but excluding the earlier to occur of (i) the date such
Revolving Credit Commitment terminates, and (ii) the Revolving Credit
Termination Date. Accrued revolving credit fees shall be payable in arrears on
the third (3rd) Business Day following each Quarterly Date, and on the earlier
to occur of (A) the date the Revolving Credit Commitments terminate, and (B) the
Revolving Credit Commitment Termination Date, commencing on the first such date
to occur after the date hereof. All revolving credit fees shall be computed on
the basis of a year of three hundred sixty (360) days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day). For purposes of computing revolving credit fees, the Revolving Credit
Commitment of a Lender shall be deemed to be used to the extent of the
outstanding Revolving Credit Loans and LC Exposure of such Lender.
(b) Letter of Credit Fees. The Borrower agrees to pay (i) to the
Administrative Agent for account of each Lender a participation fee with respect
to its participations in Letters of Credit, which shall accrue at a rate per
annum equal to the Applicable Margin over LIBOR as of the date of the issuance
of each Letter of Credit. Fees accrued through and including each Quarterly Date
shall be payable on the third (3rd) Business Day following such Quarterly Date,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Revolving Credit
Commitments terminate and any such fees accruing after the date on which the
Revolving Credit Commitments terminate shall be payable on demand. Any other
fees payable to the Issuing Lender pursuant to this paragraph shall be payable
within ten (10) days after demand. All participation fees and fronting fees
shall be computed on the basis of a year of three hundred sixty (360) days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).
(c) Closing Fees. The Borrower agrees, on or prior to the Effective Date,
to pay to the Administrative Agent for the ratable benefit of the Lenders a
closing fee in the amount of $100,000.00 (the "Closing Fee").
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(d) Payment of Fees. All fees payable hereunder shall be paid on the dates
due in immediately available funds to the Administrative Agent (or to the
Issuing Lender, in the case of fees payable to it) for distribution, in the case
of revolving credit fees and Letters of Credit participation fees, to the
Lenders entitled thereto. Fees paid shall not be refundable under any
circumstances.
2.10 Interest.
(a) ABR Loans. The Loans constituting each ABR Borrowing shall bear
interest at a rate per annum equal to the Adjusted Base Rate.
(b) ALR Loans. The Loans constituting each ALR Borrowing shall bear
interest at a rate per annum equal to the Adjusted LIBOR for the Interest Period
for such Borrowing.
(c) Default Interest. Notwithstanding the foregoing, if any principal of
or interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration,
or otherwise, such overdue amount shall bear interest, after, as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, two percent (2%) above the rate otherwise applicable to such Loan as
provided above or (ii) in the case of any other amount, two percent (2%) above
the Adjusted Base Rate.
(d) Payment of Interest. Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan and on the Revolving Credit
Commitment Termination Date; provided that (A) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (B) in the event of
any prepayment of any ALR Loan, accrued interest on the principal amount prepaid
shall be payable on the date of such prepayment, (C) in the event of prepayment
of any ABR Loan, accrued interest on the principal amount prepaid shall be
payable on the next scheduled Interest Payment Date, and (D) in the event of any
conversion of an ALR Borrowing prior to the end of the Interest Period therefor,
accrued interest on such Borrowing shall be payable on the effective date of
such conversion.
(e) Computation. Interest on ABR Loans shall be computed on the basis of a
year of three hundred sixty five (365) days (or three hundred sixty six (366) as
applicable), and shall be payable for the actual number of days elapsed.
Interest on ALR Loans and all fees payable hereunder shall be computed on the
basis of a year of three hundred sixty (360) days and shall be payable for the
actual number of days elapsed. The applicable Adjusted Base Rate and/or Adjusted
LIBOR shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error.
2.11 Alternate Rate of Interest. If prior to the commencement of the Interest
Period for any ALR Borrowing:
(a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the LIBOR for such Interest Period; or
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(b) the Administrative Agent is advised by the Required Lenders that the
LIBOR for such Interest Period will not adequately and fairly reflect the cost
to such Lenders of making or maintaining their respective Loans included in such
Borrowing for such Interest Period; then the Administrative Agent shall give
notice thereof to the Borrower and the Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, (i) any Interest Election Request that requests the conversion
of any Borrowing to, or the continuation of any Borrowing as, an ALR Borrowing
shall be ineffective and such Borrowing (unless prepaid) shall be continued as,
or converted to, an ABR Borrowing, and (ii) if any Borrowing Request requests an
ALR Borrowing, such Borrowing shall be made as an ABR Borrowing.
2.12 Increased Costs.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit
or similar requirement against assets of, deposits with or for account of,
or credit extended by, any Lender (except any such reserve requirement
reflected in the LIBOR) or the Issuing Lender; or
(ii) impose on any Lender or the Issuing Lender or the London
interbank market any other condition affecting this Agreement or ALR Loans
made by such Lender or any Letter of Credit or participation therein; and
(iii) the result of any of the foregoing shall be to increase the
cost to such Lenders of making or maintaining any ALR Loan (or of
maintaining its obligation to make any such Loan) or to increase the cost
to such Lender or the Issuing Lender of participating in, issuing or
maintaining any Letter of Credit or to reduce the amount of any sum
received or receivable by such Lender or the Issuing Lender hereunder
(whether of principal, interest or otherwise); then
the Borrower will pay to such Lender or the Issuing Lender, as the case may be,
such additional amount or amounts as will compensate such Lender or the Issuing
Lender, as the case may be, for such additional costs incurred or reduction
suffered.
(b) Capital Requirements. If any Lender or the Issuing Lender reasonably
determines that any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's or the Issuing
Lender's capital or on the capital of such Lender's or the Issuing Lender's
holding company, if any, as a consequence of this Agreement or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the Issuing Lender, to a level below that which such Lender
or the Issuing Lender or such Lender's or the Issuing Lender's holding company
could have achieved but for such Change in Law (taking into consideration such
Lender's or the Issuing Lender's policies and the policies of such Lender's or
the Issuing Lender's holding company with respect to capital adequacy), then
from time to time the Borrower will pay to such Lender or the Issuing Lender, as
the case may be, such additional amount or amounts as will compensate such
Lender or the Issuing Lender or such Lender's or the Issuing Lender's holding
company for any such reduction suffered.
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(c) Certificates from Lenders. A certificate of a Lender or the Issuing
Lender setting forth the amount or amounts, necessary to compensate such Lender
or the Issuing Lender or its holding company, as the case may be, as specified
in paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender or
the Issuing Lender, as the case may be, the amount shown as due on any such
certificate within ten (10) Business Days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or the
Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or the Issuing Lender's right to demand
such compensation; provided that the Borrower shall not be -------- required to
compensate a Lender or the Issuing Lender pursuant to this Section for any
increased costs or reductions incurred more than six (6) months prior to the
date that such Lender or the Issuing Lender, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender's or the Issuing Lender's intention to claim compensation
therefor; provided further that, if the Change in ---------------- Law giving
rise to such increased costs or reductions is retroactive, then the six (6)
month period referred to above shall be extended to include the period of
retroactive effect thereof.
2.13 Break Funding Payments. In the event of (a) the payment of any principal of
any ALR Loan other than on the applicable Interest Payment Date therefor
(including as a result of an Event of Default), (b) the conversion of any ALR
Loan other than on the last day of an Interest Period therefor, (c) the failure
to borrow, convert, continue or prepay any Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice is permitted
to be revocable under Section 2.07 and is revoked in accordance herewith), or
(d) the assignment as a result of a request by the Borrower pursuant to Section
2.16(b) of any ALR Loan other than on the last day of an Interest Period
therefor, then, in any such event, the Borrower shall pay to each Lender an
amount as will (in the reasonable determination of such Lender) compensate such
Lender for losses, costs and expenses attributable to such event. A certificate
of any Lender setting forth any amount or amounts that such Lender is entitled
to receive pursuant to this Section shall be delivered to the Borrower and shall
be conclusive absent manifest error. The Borrower shall pay such Lender the
amount shown as due on any such certificate within ten (10) Business Days after
receipt thereof.
2.14 Taxes.
(a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrower hereunder or under any other Loan Document shall be
made free and clear of and without deduction for any Indemnified Taxes or Other
Taxes; provided that if the Borrower shall be -------- required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions,
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, any Lender or the Issuing Lender (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
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(b) Payment of Other Taxes by the Borrower. In addition, the Borrower
shall pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.
(c) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent, each Lender and the Issuing Lender, within ten (10)
Business Days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section)
paid by the Administrative Agent, such Lender or the Issuing Lender, as the case
may be, and any penalties, interest and reasonable expenses arising therefrom or
with respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the Issuing Lender, or by the Administrative Agent on
its own behalf or on behalf of a Lender or the Issuing Lender, shall be
conclusive absent manifest error.
(d) Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
2.15 Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) Payments by the Borrower. The Borrower shall make each payment
required to be made by it hereunder (whether of principal, interest, fees or
reimbursement of LC Disbursements, or under Section 2.12, 2.13 or 2.14, or
otherwise) or under any other Loan Document (except to the extent otherwise
provided therein) prior to 12:00 noon, Local Time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at the Administrative Agent's Account,
except as otherwise expressly provided in the relevant Loan Document and except
payments to be made directly to the Issuing Lender as expressly provided herein
and payments pursuant to Sections 2.12, 2.13, 2.14 and 9.03, which shall be made
directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for account of any other Person to
the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All amounts owing under this Agreement (including revolving
credit fees, and for payments required under Section 2.13) or under any other
Loan Document (except to the extent otherwise provided therein) are payable in
Dollars.
(b) Application of Insufficient Payments. If at any time insufficient
funds are received by and available to the Administrative Agent to pay fully all
amounts of principal, unreimbursed LC Disbursements, interest and fees then due
hereunder, such funds shall be applied (i) first,
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to pay interest and fees then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, to pay principal and unreimbursed LC Disbursements
then due hereunder, ratably among the parties entitled thereto in accordance
with the amounts of principal and unreimbursed LC Disbursements then due to such
parties.
(c) Pro Rata Treatment. Except to the extent otherwise provided herein:
(i)(A) each payment of revolving credit fees under Section 2.09 shall be made
for account of the Lenders pro rata according to the amounts of their respective
Revolving Credit Commitments, and (B) each termination or reduction of the
amount of the Revolving Credit Commitments under Section 2.07 shall be applied
to the Revolving Credit Commitments of the Lenders pro rata according to the
amounts of their respective Revolving Credit Commitments; (ii) each Borrowing
shall be allocated pro rata among the Lenders (in the case of the making of
Loans) according to the amounts of their respective Revolving Credit
Commitments, as applicable, or their respective Loans that are to be included in
such Borrowing (in the case of conversions and continuations of Borrowings);
(iii) each payment or prepayment of principal of the Loans by the Borrower shall
be made for account of the Lenders pro rata in accordance with the respective
unpaid principal amounts of the Loans, respectively, held by them; and (iv) each
payment of interest on the Loans by the Borrower shall be made for account of
the Lenders pro rata in accordance with the amounts of interest on the Loans
then due and payable to the respective Lenders.
(d) Sharing of Payments by Lenders. If any Lender shall, by exercising any
right of set-off or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Loans or participations in LC
Disbursements resulting in such Lender receiving payment of a greater proportion
of the aggregate amount of its Loans and participations in LC Disbursements and
accrued interest thereon then due than the proportion received by any other
Lender, then the Lender receiving such greater proportion shall purchase (for
cash at face value) participations in the Loans and participations in LC
Disbursements of other Lenders to the extent necessary so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective Loans
and participations in LC Disbursements; provided that (i) -------- if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.
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(e) Presumptions of Payment. Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Administrative Agent for account of the Lenders or the Issuing Lender
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Lender, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or the
Issuing Lender, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or the Issuing Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate.
(f) Certain Deductions by the Administrative Agent. If any Lender shall
fail to make any payment required to be made by it pursuant to Section 2.04(e),
2.05(b) or 2.15(e), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for account of such Lender to satisfy such
Lender's obligations under such Sections until all such unsatisfied obligations
are fully paid.
2.16 Mitigation Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 2.12, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for account of any
Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts
to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) Replacement of Lenders. If any Lender requests compensation under
Section 2.12, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for account of any Lender pursuant to
Section 2.14, or if any Lender defaults in its obligation to fund Loans
hereunder, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 9.04), all its interests, rights and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Commitment is being assigned, the Issuing Lender), which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans and
participations in LC Disbursements accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts), and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.12 or payments required
to be made pursuant to Section 2.14, such assignment will result in a reduction
in such compensation or payments.
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A Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.
ARTICLE III REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that (a) on the Effective
Date, and (b) if any representation or warranty below is expressly stated to
have been made as of a specific date, as of such specific date:
3.01 Organization; Powers. Each of the Borrower, its Subsidiaries, Technologies
and Holdings is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted, and is qualified to do
business in and is in good standing in every jurisdiction where such
qualification is required, except where the failure to be so qualified,
individually or in the aggregate, could not result in a Material Adverse Effect.
Holdings is the owner of one hundred percent (100%) of the issued and
outstanding capital stock of the Borrower, and Technologies is the owner of one
hundred percent (100%) of the issued and outstanding capital stock of Holdings.
Greatbatch-Hittman, Inc. is the owner of one hundred percent (100%) of the
issued and outstanding capital stock of Greatbatch-Sierra, Inc.
3.02 Authorization; Enforceability. The Transactions are within the Borrower's
and its Subsidiaries' corporate powers and have been duly authorized by all
necessary corporate and, if required, by all necessary shareholder action. This
Agreement has been duly executed and delivered by the Borrower and constitutes,
and each of the other Loan Documents when executed and delivered will
constitute, a legal, valid and binding obligation of the Borrower or its
Subsidiaries, as the case may be, enforceable in accordance with its terms,
except as such enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or similar laws of general applicability affecting
the enforcement of creditors' rights, and (b) the application of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not require
any consent or approval of, registration or filing with, or any other action by,
any Governmental Authority, except such as have been obtained or made and are in
full force and effect, (b) will not violate any applicable law or regulation or
the charter, by-laws or other organizational documents of the Borrower or any of
its Subsidiaries or any order of any Governmental Authority, (c) will not
violate or result in a default under any indenture, agreement or other
instrument binding upon the Borrower or any of its Subsidiaries or assets, or
give rise to a right thereunder to require any payment to be made by any such
Person, and (d) will not result in the creation or imposition of any Lien on any
asset of the Borrower or any of its Subsidiaries other than Liens in favor of
the Administrative Agent and the Lenders in connection with the Transactions.
3.04 Financial Condition; No Material Adverse Change.
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(a) Financial Condition. The Borrower has heretofore furnished to the
Lenders (i) a Consolidated balance sheet and statements of income, stockholders'
equity and cash flows of Technologies and its Subsidiaries (including the
Borrower and its Subsidiaries) as of and for each of the fiscal years ended
January 3, 2003, January 2, 2004 and December 31, 2004, as audited and reported
on by Deloitte & Touche, LLP, independent public accountants and (ii) a
Consolidated unaudited balance sheet and statements of income, stockholders'
equity and cash flows of Technologies and its Subsidiaries (including the
Borrower and its Subsidiaries) as of and for the fiscal quarter ended March 31,
2005. The financial statements referred to in clause (i) above present fairly,
in all material respects, the financial position and results of operations and
cash flows of Technologies and its Subsidiaries as of such dates and for such
periods in accordance with GAAP. Subject to normal year-end adjustments and
disclosures as would be made in the financial statements referred to in clause
(ii) above if audited, the financial statements referred to in clause (ii) above
present fairly, in all material respects, the financial position and results of
operations and cash flows of Technologies and its Subsidiaries as of such date
and for such period in accordance with GAAP.
(b) No Material Adverse Change. Since March 15, 2005, there has been no
material adverse change in the business, assets, operations or condition,
financial or otherwise, of (i) Technologies and its Subsidiaries, taken as a
whole, or (ii) the Borrower and its Subsidiaries, taken as a whole.
3.05 Properties.
(a) Property Generally. Each of the Borrower and its Subsidiaries has good
title to, or valid leasehold interests in, all its real and personal property
material to its business, subject only to Liens permitted by Section 6.02 and
except for minor defects in title that do not interfere with its ability to
conduct its business as currently conducted or to utilize such properties for
their intended purposes.
(b) Intellectual Property. Each of the Borrower and its Subsidiaries owns
all trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Borrower and its
Subsidiaries does not materially infringe upon the rights of any other Person.
All patents, trademarks and tradenames owned by the Borrower or any of its
Subsidiaries on the Effective Date are listed on Part D of Schedule II hereto.
3.06 Litigation and Environmental Matters.
(a) Actions. Suits and Proceedings. Except for the Disclosed Matters,
there are no actions, suits or proceedings by or before any arbitrator or
Governmental Authority now pending against, or to the knowledge of the Borrower
threatened against, or affecting the Borrower or any of its Subsidiaries (i)
that, if adversely determined, could, individually or in the aggregate, result
in a Material Adverse Effect, or (ii) in connection with this Agreement or the
Transactions.
(b) Environmental Matters. Except for the Disclosed Matters, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, which noncompliance or
failure could, individually or in the aggregate,
39
result in a Material Adverse Effect, (ii) has become subject to any material
Environmental Liability, (iii) has received notice of any claim with respect to
any Environmental Liability, or (iv) knows of any basis for any Environmental
Liability.
(c) Disclosed Matters. Since the date of this Agreement, there has been no
change in the status of the Disclosed Matters that, individually or in the
aggregate, has resulted in, or could result in, a Material Adverse Effect.
3.07 Compliance with Laws and Agreements. Each of the Borrower and its
Subsidiaries is in material compliance with all laws, regulations and orders of
any Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property. No Default has
occurred and is continuing.
3.08 Investment and Holding Company Status. Neither the Borrower nor any of its
Subsidiaries is (a) an "investment company" as defined in, or subject to
regulation under, the Investment Company Act of 1940, or (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935.
3.09 Taxes. Each of Technologies, Holdings, the Borrower and its Subsidiaries
has timely filed or caused to be filed all tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which such Person has set aside on its books
adequate reserves and (b) for such failures to timely file Tax returns or
reports or nonpayment of Taxes which could not, individually or in the
aggregate, result in a Material Adverse Effect.
3.10 ERISA. No ERISA Event has occurred or is reasonably expected to occur that
has resulted in or that could result in a Material Adverse Effect. No Plan is
subject to Title IV of ERISA.
3.11 Disclosure. None of the reports, financial statements, certificates or
other information furnished by or on behalf of the Borrower or its Subsidiaries
to the Lenders in connection with the negotiation of this Agreement and the
other Loan Documents or delivered hereunder or thereunder (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided -------- that, with respect to projected
financial information, the Borrower represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.
3.12 Use of Credit. Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose, whether immediate, incidental or ultimate, of buying or
carrying Margin Stock, and no part of the proceeds of any extension of credit
hereunder will be used to buy or carry any Margin Stock.
3.13 Anti-Terrorism Law Compliance. Neither the Borrower nor any of its
Subsidiaries are subject to or in violation of any law, regulation, or list of
any government agency (including, without limitation, the U.S. Office of Foreign
Asset Control list, Executive Order No. 13224 or
40
the USA Patriot Act) that prohibits or limits the conduct of business with or
the receiving of funds, goods or services to or for the benefit of certain
persons specified therein or that prohibits or limits any Lender or Issuing
Lender from making any advance or extension of credit to the Borrower or from
otherwise conducting business with the Borrower.
ARTICLE IV CONDITIONS
4.01 Effective Date. The continued obligation of the Lenders to make Loans and
of the Issuing Lender to issue Letters of Credit hereunder shall not become
effective until the date on which the Administrative Agent shall have received
each of the following documents, each of which shall be satisfactory to the
Administrative Agent (and to the extent specified below, to each Lender) in form
and substance (or such condition shall have been waived in accordance with
Section 9.02):
(a) Executed Counterparts. From each party hereto either (i) a counterpart
of this Agreement signed on behalf of such party, or (ii) written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page to this Agreement) that such party has
signed a counterpart of this Agreement.
(b) Replacement Notes. An executed original Revolving Credit Note of the
Borrower issued in favor of each Lender in the maximum principal amount of such
Lender's respective Revolving Credit Commitment which shall be in substitution
and replacement for, but not in payment of, revolving credit notes currently
held by the Borrower.
(c) Opinion of Counsel. A favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Effective Date) of Hodgson
Russ, LLP, counsel to the Borrower, its Subsidiaries, Technologies and Holdings,
substantially in the form of Exhibit B, and covering such other matters relating
to the Borrower, this Agreement or the Transactions as the Required Lenders
shall reasonably request (and the Borrower hereby instructs such counsel to
deliver such opinion to the Lenders and the Administrative Agent).
(d) Corporate Documents. Such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the
organization, existence and good standing of the Borrower, its Subsidiaries,
Technologies and Holdings, the authorization of the Transactions and any other
legal matters relating to the Borrower, this Agreement or the Transactions, all
in form and substance satisfactory to the Administrative Agent and its counsel.
(e) Officer's Certificate. A certificate, dated the Effective Date and
signed by a Senior Executive Officer or a Financial Officer of the Borrower,
confirming compliance with the conditions set forth in the lettered clauses of
the first sentence of Section 4.02.
(f) Reaffirmation Agreement. Each of the Borrower, each Parent Guarantor
and each Subsidiary Guarantor (other than Greatbatch, LLC and Laboratories)
shall have executed and delivered to the Administrative Agent a Reaffirmation
Agreement (the "Reaffirmation Agreement") in form and content acceptable to the
Administrative Agent (on behalf of the Lenders), acknowledging and confirming
the continuing effectiveness and enforceability of each of the other Loan
Documents to which such Person is a party.
41
(g) Guaranty Agreements. Greatbatch, LLC and Laboratories shall have
executed and delivered to the Administrative Agent a Guaranty Agreement in form
and content acceptable to the Administrative Agent (on behalf of the Lenders),
providing for the guarantee of payment by such Person of the Borrower's
obligations to the Administrative Agent, the Lenders, the Swingline Lender and
the Issuing Lender under the Loan Documents.
(h) Security Agreements. Greatbatch, LLC and Laboratories shall have
executed and delivered to the Administrative Agent a Security Agreement in form
and content acceptable to the Administrative Agent, granting to the
Administrative Agent (on behalf of the Lenders) a Lien in all of such Person's
equipment, inventory, fixtures, accounts, chattel paper, general intangibles,
documents, investment property, instruments, deposit accounts, letter-of-credit
rights (whether or not the letter of credit is evidenced by a writing),
commercial tort claims, and general intangibles including, without limitation,
payment intangibles, whether now owned or hereafter acquired, wherever located,
and any and all products and proceeds thereof, and shall secure the payment of
any and all Indebtedness and liabilities, whether now existing or hereafter
incurred, of such Subsidiary to the Administrative Agent, the Lenders, the
Swingline Lender and the Issuing Lender under the Loan Documents; and the
Administrative Agent shall have received appropriate financing statements to
perfect each such Lien, which Lien shall be superior in priority to all other
Liens, other than Liens arising after the date of this Agreement having priority
over the Liens of the Administrative Agent by operation of applicable law or
Liens permitted pursuant to the provisions of Section 6.02. Greatbatch, LLC and
Laboratories shall have executed and delivered to the Administrative Agent a
Patent Security Agreement, a Trademark Security Agreement and a Copyright
Security Agreement, each in form and substance acceptable to the Administrative
Agent.
(i) Certificates of Insurance. The Administrative Agent shall have
received certificates of insurance and insurance policies, in form and content
acceptable to the Administrative Agent, evidencing the insurance required to be
carried by the Borrower pursuant to Section 5.07 hereof with endorsements,
satisfactory to the Administrative Agent, designating the Administrative Agent
as an additional insured and a loss payee and further designating that each such
insurance policy contains a notice of cancellation provision satisfactory to the
Administrative Agent.
(j) Payment of Fees. On or before Effective Date the Administrative Agent
the Administrative Agent shall have received all fees, including but not limited
to the Closing Fee, payable to the Administrative Agent for itself as
Administrative Agent pursuant to one or more agreements with the Borrower
relating to such fees.
(k) General Assurances. All other documents and legal matters in
connection with the transactions contemplated by this Agreement and the other
Loan Documents shall be satisfactory in form and substance to the Administrative
Agent. The Borrower shall have delivered such further documents to the
Administrative Agent and taken such further action respecting this Agreement and
the other Loan Documents as the Administrative Agent or any Lender or counsel to
the Administrative Agent may reasonably request.
42
The obligation of any Lender to make its initial extension of credit
hereunder is also subject to the payment by the Borrower of such fees as the
Borrower shall have agreed to pay to any Lender or the Administrative Agent in
connection herewith, including, without limitation, the reasonable fees and
expenses of Lippes Mathias Wexler Friedman LLP, counsel to the Administrative
Agent, in connection with the negotiation, preparation, execution and delivery
of this Agreement and the other Loan Documents and the extensions of credit
hereunder (to the extent that statements for such fees and expenses have been
delivered to the Borrower).
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
4.02 Each Credit Event. The obligation of each Lender to make any Loan, and of
the Issuing Lender to issue, amend, renew or extend any Letter of Credit, is
additionally subject to the satisfaction of the following conditions:
(a) the representations and warranties of the Borrower set forth in this
Agreement shall be true and correct on and as of the date of such Loan or the
issuance, amendment, renewal or extension of such Letter or Credit (or, if any
such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date); and
(b) at the time of and immediately after giving effect to such Loan or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in the preceding
sentence.
ARTICLE V AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the principal of
and interest on each Note and all fees and expenses payable under the Loan
Documents shall have been paid in full and all Letters of Credit shall have
expired or terminated and all LC Disbursements shall have been reimbursed, the
Borrower covenants and agrees with the Administrative Agent, the Swingline
Lender, the Issuing Lender and the Lenders that:
5.01 Financial Statements and Other Information. The Borrower will furnish, or
cause to be furnished, to the Administrative Agent and each Lender:
(a) within ninety (90) days after the end of each fiscal year of
Technologies, the audited Consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows of Technologies and its
Subsidiaries as of the end of and for such year, setting forth in each case in
comparative form the figures for the previous fiscal year, all audited and
reported by Deloitte & Touche, LLP or other independent public accountants of
recognized national standing (without a "going concern" or like qualification or
exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of operations of
Technologies and its Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied;
43
(b) within forty five (45) days after the end of each of the first three
(3) fiscal quarters of each fiscal year of Technologies, the Consolidated
balance sheet and related statements of operations, stockholders' equity and
cash flows as of the end of and for such fiscal quarter and the then elapsed
portion of the fiscal year for Technologies and its Subsidiaries (including the
Borrower and its Subsidiaries), setting forth in each case in comparative form
the figures for (or, in the case of the balance sheet, as of the end of the
corresponding period or periods of the previous fiscal year), all certified by a
Financial Officer of the Borrower as presenting fairly in all material respects
the financial condition and results of operations on a Consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements under clause
(a) or (b) of this Section, a certificate of a Financial Officer of the Borrower
in the form of Exhibit F (i) certifying --------- as to whether a Default has
occurred and, if a Default has occurred, specifying the details thereof and any
action taken or proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with Sections 6.01,
6.07 and Section (o) of Article VII, and (iii) stating whether any change in
GAAP or in the application thereof has occurred since the date of the audited
financial statements referred to in Section 3.04 and, if any such change has
occurred, specifying the effect of such change on the financial statements
accompanying such certificate;
(d) concurrently with any delivery of financial statements under clause
(a) of this Section, a certificate of the accounting firm that reported on such
financial statements stating whether they obtained knowledge during the course
of their examination of such financial statements of any Default (which
certificate may be limited to the extent required by accounting rules or
guidelines);
(e) promptly following submission to the United States Securities and
Exchange Commission, a copy of Form 10-Q (with all attachments), Form 10-K and
all other forms, documents or certificates filed by Technologies or any of its
Subsidiaries with such Commission; and
(f) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any of its Subsidiaries, or compliance with the terms of this
Agreement and the other Loan Documents, as the Administrative Agent or any
Lender may reasonably request.
5.02 Notices of Material Events. The Borrower will furnish to the Administrative
Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the
Borrower or any of its Affiliates that, if adversely determined, could result in
a Material Adverse Effect;
44
(c) the occurrence of any ERISA Event;
(d) the assertion of any material environmental matter by any Person
against, or with respect to the activities of, the Borrower or any of its
Subsidiaries and any alleged material violation of or non-compliance with any
Environmental Laws or any permits, licenses or authorizations; and
(e) any other development that results in, or could result in, a Material
Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
5.03 Existence: Conduct of Business. The Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done all things necessary to preserve,
renew and keep in full force and effect its legal existence and the rights,
licenses, permits, privileges and franchises material to the conduct of its
business; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.03.
5.04 Future Subsidiaries; Subsidiary Guarantors. The Borrower shall cause each
domestic Subsidiary of the Borrower on the Effective Date, and each Person that
becomes a domestic Subsidiary of the Borrower or of any Subsidiary of the
Borrower after the Effective Date, to execute and deliver to the Administrative
Agent a Guaranty Agreement, a Security Agreement, Intellectual Property Security
Agreements, and such other agreements, documents and instruments reasonably
requested by the Administrative Agent. All Subsidiaries of the Borrower on the
Effective Date are listed on Part E of Schedule II. Upon the request of the
Required Lenders, the Borrower shall execute ----------- and deliver to the
Administrative Agent (on behalf of the Lenders) a Borrower Pledge Agreement with
respect to the capital stock or other securities of any Subsidiary of the
Borrower that is domiciled outside of the United States, or of any Person that
is domiciled outside of the United States that becomes a Subsidiary of the
Borrower or of any Subsidiary of the Borrower after the Effective Date, pursuant
to which the Borrower shall pledge to the Administrative Agent (on behalf of the
Lenders) up to a maximum of sixty six and two thirds percent (66 2/3 %) of the
issued and outstanding securities of such foreign Subsidiary, and shall secure
the payment of any and all Indebtedness and liabilities, whether now existing or
hereafter incurred, of the Borrower to the Administrative Agent, the Lenders and
the Issuing Lender, and in connection therewith shall have delivered to the
Administrative Agent certificates representing such issued and outstanding
securities with related stock powers duly endorsed in blank
5.05 Future Parent Entities; Parent Guarantors. If the Borrower or any
Subsidiary of the Borrower becomes a Subsidiary of any Person other than
Technologies or Holdings after the Effective Date, the Borrower shall cause each
such Person to execute and deliver to the Administrative Agent a Guaranty
Agreement (each such Person to be referred to as a "Parent Guarantor").
45
5.06 Payment of Obligations. The Borrower will, and will cause each of its
Subsidiaries to, pay its obligations, including tax liabilities before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest would not result in a Material Adverse Effect.
5.07 Maintenance of Properties; Insurance. The Borrower will, and will cause
each of its Subsidiaries to, (a) keep and maintain all property material to the
conduct of its business in good working order and condition, ordinary wear and
tear excepted, and (b) maintain, with financially sound and reputable insurance
companies, insurance in such amounts and against such risks as are customarily
maintained by companies engaged in the same or similar businesses operating in
the same or similar locations. Part F of Schedule II lists and generally
describes each policy of insurance covering the business of, or any material
asset of, the Borrower or any of its Subsidiaries on the Effective Date.
5.08 Books and Records; Inspection Rights. The Borrower will, and will cause
each of its Subsidiaries to, keep proper books of record and account in which
full, true and correct entries are made of all dealings and transactions in
relation to its business and activities. The Borrower will, and will cause each
of its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice and during
normal business hours, to visit and inspect its properties, to examine and make
extracts from its books and records, and to discuss its affairs, finances and
condition with its officers and independent accountants, all at such reasonable
times and as often as reasonably requested.
5.09 Compliance with Laws. The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and orders of any
Governmental Authority applicable to it or its property in all material
respects.
5.10 Use of Proceeds. The proceeds of the Loans will only be used, and Letters
of Credit will be issued only to support obligations incurred by the Borrower
and its Subsidiaries to finance acquisitions permitted pursuant to the terms
hereof and capital expenditures relating to existing and acquired properties,
and for the general corporate purposes of the Borrower and its Subsidiaries in
the ordinary course of business. No part of the proceeds of any Loan will be
used whether directly or indirectly, for any purpose that entails violation of
any of the Regulations of the Board, including Regulations U and X. in the
ordinary course of business
5.11 Anti-Terrorism Laws. Neither the Borrower nor any of its Subsidiaries shall
be subject to or in violation of any law, regulation, or list of any government
agency (including, without limitation, the U.S. Office of Foreign Asset Control
list, Executive Order No. 13224 or the USA Patriot Act) that prohibits or limits
the conduct of business with or the receiving of funds, goods or services to or
for the benefit of certain persons specified therein or that prohibits or limits
any Lender or Issuing Lender from making any advance or extension of credit to
the Borrowers or from otherwise conducting business with the Borrowers.
46
ARTICLE VI NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of and
interest on each Note and all fees and expenses payable under the Loan Documents
have been paid in full and all Letters of Credit have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Administrative Agent, the Issuing Lender, the Swingline Lender
and the Lenders that:
6.01 Indebtedness.
(a) The Borrower will not, nor will it permit any of its Guarantors to,
create, incur, assume or permit to exist any Indebtedness, except:
(i) Indebtedness created hereunder;
(ii) Indebtedness existing on the date hereof and set forth in Part
A of Schedule II and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount
thereof;
(iii) Indebtedness of the Borrower to any Subsidiary Guarantor and
of any Subsidiary Guarantor to the Borrower or any other Subsidiary
Guarantor;
(iv) secured Indebtedness (including, without limitation,
Indebtedness incurred in connection with Capital Lease Obligations, and
Hedging Agreements) of the Borrower or such Guarantor in excess of
Indebtedness permitted by Sections 6.01(a)(i) and (ii), above, provided
that (A) the incurrence and/or repayment of such Indebtedness would not
cause a violation of Section (o) of Article VII, (B) the ratio of
Consolidated Funded Debt (including the Indebtedness to be incurred) to
Consolidated Adjusted EBITDA (as at the end of the last fiscal quarter for
which financial statements are available but giving pro forma effect to
such additional Indebtedness as set forth in Section 1.03) is less than
the then-applicable Leverage Ratio as set forth in Section ARTICLE VII(o)
of Article VII, (C) in the case of Indebtedness incurred in connection
with Capital Lease Obligations, the obligations incurred do not exceed the
fair market value of such property or assets (as determined in good faith
by the Board of Directors of the Borrower or of the Guarantor incurring
such Indebtedness), (D) the creditors in respect of such additional
Indebtedness (other than creditors with respect to Indebtedness secured by
Liens permitted pursuant to Section 6.02) shall become parties to an
intercreditor agreement by and among the Lenders (the "Collateral Agency
Agreement") whereby the Administrative Agent shall agree to act as
collateral agent for itself, the Lenders and such additional creditors as
provided for herein, and the Collateral Agency Agreement shall be amended
if necessary to reflect such additional Indebtedness and otherwise be in
form and substance satisfactory to the Lenders, (E) if subordinated in
right of payment to the Indebtedness to the Lenders hereunder, such
Indebtedness is created under an agreement pursuant to which such
Indebtedness is subordinated in right of payment to the Indebtedness to
the Lenders hereunder pursuant to a subordination agreement in form and
content acceptable to the Lenders, and (F) no Default or Event of Default
shall occur or be continuing after incurring such Indebtedness;
47
(v) unsecured Indebtedness of the Borrower or such Guarantor in
excess of Indebtedness permitted by Sections 6.01(a)(i) and (ii), above,
provided that (A) the incurrence and/or repayment of such Indebtedness
would not cause a violation of Section (o) of Article VII, (B) the ratio
of Consolidated Funded Debt to Consolidated Adjusted EBITDA (as at the end
of the last fiscal quarter for which financial statements are available
but giving pro forma effect to such additional Indebtedness as set forth
in Section 1.03) is less than the then-applicable Leverage Ratio, (C) in
the case of Indebtedness incurred in connection with Capital Lease
Obligations, the obligations incurred do not exceed the fair market value
of such property or assets (as determined in good faith by the Board of
Directors of the Borrower or of the Guarantor incurring such
Indebtedness), (D) such Indebtedness is Subordinated Indebtedness, and (E)
no Default or Event of Default shall occur or be continuing after
incurring such Indebtedness;
(vi) if no Default or Event of Default shall have occurred and be
continuing, the provisions of this Section 6.01(a) will not prevent the
Borrower or any Guarantor from becoming liable for secured Indebtedness
pari passu to the Indebtedness to the Lenders hereunder, or for
Subordinated Indebtedness, in each case incurred for the purpose of
extending, renewing, replacing or refinancing the same type of debt,
provided that (A) the principal amount of such Indebtedness shall not
exceed the principal amount of the debt being extended, renewed, replaced
or refinanced, together with any accrued interest and premium with respect
thereto and any costs and expenses related to such extension, renewal,
replacement or refinancing, and (B) such Indebtedness (i) shall not mature
prior to the stated maturity of the pari passu Indebtedness or
Subordinated Indebtedness so extended, renewed, replaced or refinanced,
(ii) shall have an average life equal to or greater than the remaining
average life of the Indebtedness so extended, renewed, replaced or
refinanced, and (iii) if Indebtedness other than Subordinated Indebtedness
is being extended, renewed, replaced or refinanced, such Indebtedness
shall continue to be subject to the Collateral Agency Agreement, and if
Subordinated Indebtedness is being extended, renewed, replaced or
refinanced, such Subordinated Indebtedness (as extended, renewed, replaced
or refinanced) shall be created under an agreement pursuant to which such
Indebtedness is subordinated in right of payment to the Indebtedness to
the Lenders hereunder pursuant to a subordination agreement in form and
content acceptable to the Lenders;
(b) The Borrower will not, nor will it permit any of its Subsidiary
Guarantors to, create, incur, assume or permit to exist any Indebtedness,
except:
(i) Indebtedness assumed by the Borrower and/or by any of its
Subsidiary Guarantors in any acquisition permitted pursuant to Section
6.03(c)(iii) to the extent, and solely to the extent, the aggregate
principal amount of all such Indebtedness at any time outstanding does not
exceed Seven Million Five Hundred Thousand Dollars ($7,500,000), and
refinancings and replacements thereof (A) in a principal amount not
exceeding in the aggregate the principal amount of the Indebtedness so
refinanced or replaced plus any prepayment penalties, fees and expenses
incurred in connection with such refinancings or replacements, (B) with an
all-in cost which is less than the Indebtedness so refinanced or replaced,
and (C) with an average life to maturity of not less than the then average
life to maturity of the Indebtedness so refinanced or replaced; and
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(ii) Indebtedness of the Borrower or any Subsidiary Guarantor
incurred to finance the acquisition, construction or improvement of any
fixed or capital assets, including Capital Lease Obligations and any
Indebtedness assumed in connection with the acquisition of any such assets
or secured by a Lien on any such assets prior to the acquisition thereof,
and extensions, renewals and replacements of any such Indebtedness that do
not increase the outstanding principal amount thereof; provided that (A)
such Indebtedness is incurred prior to or within thirty (30) days after
such acquisition or the completion of such construction or improvement and
(B) the aggregate principal amount of Indebtedness permitted by this
clause (ii) shall not exceed Five Million Dollars ($5,000,000) at any time
outstanding.
6.02 Liens. The Borrower will not, nor will it permit any of its Subsidiaries
to, create, incur, assume or permit to exist any Lien on any property,
including, without limitation, real property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:
(a) any Lien on any property or asset of the Borrower or any of its
Subsidiaries existing on the date hereof and set forth in Part B of Schedule II;
(b) Liens for taxes, assessments, governmental charges or levies,
statutory Liens of landlords and Liens of carriers, warehousemen, mechanics and
materialmen incurred in the ordinary course of business for sums not yet due or
which are being actively contested in good faith by appropriate proceedings;
(c) Liens (other than Liens imposed on the Borrower or any of its
Subsidiaries under ERISA) incurred or deposits made in the ordinary course of
business (a) in connection with workers' compensation, unemployment insurance
and other types of social security or (b) to secure (or to obtain letters of
credit that secure) performance of tenders, statutory obligations, surety and
appeal bonds, bids, leases, performance bonds, sales contracts and other similar
obligations; provided that, in each case, such Liens do not materially detract
from the value of the property or assets of the Borrower or its Subsidiaries or
materially impair the use thereof in the operation of the business of the
Borrower or its Subsidiaries;
(d) Liens (i) securing Capital Lease Obligations, or (ii) placed on
property acquired by the Borrower or any of its Subsidiaries (other than
property consisting of securities or constituting the assets of a business
acquired in whole or in part from any Person or Persons) and existing at the
time of the acquisition of such property, or (iii) placed on property being
acquired or constructed by the Borrower or any of its Subsidiaries to secure the
purchase price or cost thereof, or (iv) securing Indebtedness incurred to
finance any acquisition or construction described in clauses (i) through (iii)
immediately above and permitted under Section 6.01, provided that the Lien is
confined to the property so acquired or constructed; and
(e) Liens extending, renewing or replacing any Lien permitted by clauses
(a) and (d) above, provided that (i) such Lien shall not apply to any other
property or assets of the Borrower or any Subsidiary, (ii) such extensions,
renewals and replacements thereof that do not increase the outstanding principal
amount thereof and (iii) that, at the time of and immediately after giving
effect to such extension, renewal or replacement is in effect, no Default shall
have occurred and be continuing.
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6.03 Fundamental Changes.
(a) The Borrower will not, nor will it permit any of its Subsidiaries to,
enter into any transaction of merger or consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), except:
(i) any Subsidiary of the Borrower may be merged or consolidated
with or into the Borrower or another Subsidiary, provided (A) that if any
such transaction shall be between a Subsidiary and the Borrower, the
Borrower shall be the continuing or surviving corporation, and (B) if any
such transaction shall be between a Subsidiary and another Subsidiary, the
surviving or continuing Subsidiary shall be a Subsidiary Guarantor; and
(ii) any merger or consolidation permitted under clause (iii) of
paragraph (c) of this Section.
(b) The Borrower will not, nor will it permit any of its Subsidiaries to,
convey, sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, all or a substantial part of its business or property,
whether now owned or hereafter acquired, except:
(i) any Subsidiary Guarantor of the Borrower may sell, lease,
transfer or otherwise dispose of any or all of its property (upon
voluntary liquidation or otherwise) to the Borrower or another Subsidiary
Guarantor of the Borrower; and
(ii) the capital stock of any Subsidiary of the Borrower may be
sold, transferred or otherwise disposed of, to the Borrower or another
Subsidiary Guarantor of the Borrower.
(c) The Borrower will not, nor will it permit any of its Subsidiaries to,
acquire any business or property from, or capital stock of, or be a party to any
acquisition of, any Person (whether by way of purchase of such assets or stock,
by merger or consolidation or otherwise), except:
(i) for any merger or consolidation permitted under clause (i) of
paragraph (a) of this Section;
(ii) for purchases of inventory and other property to be sold or
used in the ordinary course of business and Investments permitted under
Section 6.06(a); and
(iii) the Borrower or any Subsidiary Guarantor of the Borrower may
acquire any business, and the related assets, of any other Person (whether
by way of purchase of assets or stock, by merger or consolidation or
otherwise), so long as such acquisition meets the following qualifications
(each such acquisition a "Permitted Acquisition"):
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[A] if such acquisition shall be effected by merger or
consolidation involving the Borrower, the Borrower shall be
the continuing or surviving entity;
[B] such acquisition (if by purchase of stock) shall be
effected in such manner so that the acquired entity becomes a
Subsidiary Guarantor of the Borrower;
[C] such acquisition involves a line or lines of
business that will not substantially change the general nature
of the business in which the Borrower and its Subsidiaries,
considered as an entirety, are engaged on the Effective Date.
[D] no Default or Event of Default shall exist prior to
or immediately after giving effect to such acquisition;
[E] the Borrower shall have delivered to the
Administrative Agent a certificate of a Financial Officer in
the form of Exhibit F showing calculations in reasonable
detail to demonstrate compliance with clause Section (o) of
Article VII immediately above; and
[F] the Borrower shall have obtained the prior written
consent of the Required Lenders.
6.04 Lines of Business. The Borrower will not, nor will it permit any of its
Subsidiaries to, engage to any material extent in any business other than the
business of manufacturing, distributing and selling components and assemblies
for medical devices, batteries, capacitors and precision components and
assemblies for select industrial and medical market segments.
6.05 Restrictive Agreements. The Borrower will not, and will not permit any of
its Subsidiaries to, enter into any agreement prohibiting:
(a) (i) the creation or assumption of any Lien in favor of the
Administrative Agent and/or the Lenders upon its properties, revenues or assets,
whether now owned or hereafter acquired; provided, the -------- Borrower may,
and may permit any of its Subsidiaries to, enter into any agreement restricting
the right of the Administrative Agent and/or the Lenders to make subject to a
Lien any property to the extent (A) such property is subject to a security
interest in favor of another Person, (B) the Indebtedness incurred by the
Borrower or such Subsidiary is otherwise permitted pursuant to Section 6.01, and
(C) the Lien in favor of such third Person is otherwise permitted pursuant to
Section 6.02, or (ii) the ability of the Borrower or any Subsidiary Guarantor to
amend or otherwise modify this Agreement or any other Loan Document; and
(b) any Subsidiary from making any payments, directly or indirectly, to
the Borrower by way of dividends, advances, repayments of loans or advances,
reimbursements of management and other intercompany charges, expenses and
accruals or other returns on investments, or any other agreement or arrangement
which restricts the ability of any such Subsidiary to make any payment, directly
or indirectly, to the Borrower.
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6.06 Investments, Loans, Advances, Guarantees and Acquisitions; Hedging
Agreements.
(a) Investments, Etc. The Borrower will not, nor will it permit any of its
Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly owned Subsidiary prior to such merger) any
capital stock, evidences of indebtedness or other securities (including any
option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other interest in, any other Person, or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit, except:
(i) investments existing on the date hereof and set forth in Part C
of Schedule II;
(ii) Permitted Investments;
(iii) investments by the Borrower in the capital stock of its
Subsidiaries;
(iv) loans or advances made by the Borrower to any Subsidiary
Guarantor and made by any Subsidiary Guarantor to the Borrower or another
Subsidiary Guarantor;
(v) Guarantees constituting Indebtedness permitted by Section 6.01;
and
(vi) any transaction permitted under Section 6.03.
(b) Hedging Agreements. The Borrower will not, nor will it permit any of
its Subsidiaries to, enter into any Hedging Agreement, other than Hedging
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Borrower or any Subsidiary is exposed in the conduct of its
business or the management of its liabilities.
6.07 Restricted Payments. The Borrower will not, nor will it permit any of its
Subsidiaries to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment; provided that:
(a) the Borrower may declare and pay dividends with respect to its capital
stock payable as follows:
(i) in additional shares of its common stock, or
(ii) in cash only if, and solely to the extent, the aggregate amount
of cash dividends declared and paid by the Borrower for any period does
not exceed the difference between: (A) fifty percent (50%) of the
Consolidated Net Income of the Borrower and its Subsidiaries for such
period, and (B) the lesser of (x) the aggregate amount of cash paid (as
dividends or otherwise) by the Borrower during such period pursuant to
clause (b) immediately below or (y) One Hundred Thousand Dollars
($100,000), or
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(iii) any combination of the foregoing; and
(b) in any fiscal year the Borrower may declare and pay cash dividends
with respect to its capital stock, and/or may make payments of cash to any
parent corporation; provided, in no event shall the aggregate amount of cash
dividends and cash payments made pursuant to this clause (b) exceed One Hundred
Thousand Dollars ($100,000); and
(c) in any fiscal year of the Borrower the Borrower may make payments to
its Affiliates only if, and solely to the extent, the transaction or
transactions giving rise to such payments satisfy the requirements of Section
6.08; and
(d) the Borrower may make payments to former participants of the
Borrower's existing employee stock ownership plan qualified under ERISA (the
"ESOP") in connection with the redemption of the securities of the Borrower held
in such former participant's ESOP account, as permitted pursuant to the terms of
the ESOP or as otherwise required by ERISA.
Nothing herein shall be deemed to prohibit the payment of dividends by any
Subsidiary of the Borrower to the Borrower or to any other Subsidiary Guarantor
of the Borrower.
6.08 Transactions with Affiliates. The Borrower will not, nor will it permit any
of its Subsidiaries to, sell, lease or otherwise transfer any property or assets
to, or purchase, lease or otherwise acquire any property or assets from, or
otherwise engage in any other transactions with, any of its Affiliates, except
(a) transactions in the ordinary course of business at prices and on terms and
conditions not less favorable to the Borrower or such Subsidiary than could be
obtained on an arm's-length basis from unrelated third parties, (b) transactions
between or among the Borrower and its Subsidiaries not involving any other
Affiliate and (c) any Restricted Payment permitted by Section 6.07.
6.09 Sale and Lease-Back Transactions. The Borrower will not, nor will it permit
any of its Subsidiaries to, enter into any arrangement, directly or indirectly,
with any Person whereby it shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property which it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.
ARTICLE VII EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or Note or
any reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a date
fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or Note or any
fee or any other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement or under any other Loan Document, when and
as the same shall become due and payable, and such failure shall continue
unremedied for a period of five (5) or more Business Days;
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(c) any representation or warranty made or deemed made by or on behalf of
the Borrower or any of its Subsidiaries in or in connection with this Agreement
or any other Loan Document or any amendment or modification hereof or thereof,
or in any report, certificate, financial statement or other document furnished
pursuant to or in connection with this Agreement or any other Loan Document or
any amendment or modification hereof or thereof, shall prove to have been
incorrect when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant, condition
or agreement contained in Section 5.02(a) or 5.03 (with respect to the
Borrower's existence) or in ARTICLE VI;
(e) the Borrower shall fail to observe or perform any covenant, condition
or agreement contained in this Agreement (other than those specified in clauses
(a), (b) or (d) of this Article) or any other Loan Document and such failure
shall continue unremedied for a period of ten (10) or more Business Days after
notice thereof from the Administrative Agent (given at the request of any
Lender) to the Borrower;
(f) any Subsidiary Guarantor or Parent Guarantor shall fail to observe or
perform any covenant, condition or agreements contained in any Loan Document to
which it is a party, and such failure shall continue unremedied for a period of
ten (10) or more Business Days after notice thereof from the Administrative
Agent (given at the request of any Lender) to such Subsidiary Guarantor or
Parent Guarantor;
(g) the Borrower or any of its Subsidiaries shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Indebtedness, the outstanding and unpaid principal amount of which at the time
equals or exceeds One Million Dollars ($1,000,000), when and as the same shall
become due and payable;
(h) any event or condition occurs that results in any Indebtedness, the
outstanding and unpaid principal amount of which at the time equals or exceeds
One Million Dollars ($1,000,000), becoming due prior to its scheduled maturity
or that enables or permits (with or without the giving of notice, the lapse of
time or both) the holder or holders of such Indebtedness or any trustee or agent
on its or their behalf to cause such Indebtedness to become due, or to require
the prepayment, repurchase, redemption or defeasance thereof, prior to its
scheduled maturity;
(i) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any of its Subsidiaries or its debts, or of a
substantial part of its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect, or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any of its Subsidiaries or for a
substantial part of its assets, and, in any such case, such proceeding or
petition shall continue undismissed for a period of sixty (60) or more days or
an order or decree approving or ordering any of the foregoing shall be entered;
54
(j) the Borrower or any of its Subsidiaries shall (i) voluntarily commence
any proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (i) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any of its Subsidiaries or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;
(k) the Borrower or any of its Subsidiaries shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;
(l) one or more judgments for the payment of money in an aggregate amount
in excess of applicable insurance coverage of One Million Dollars ($1,000,000)
or more shall be rendered against the Borrower or any of its Subsidiaries or any
combination thereof and the same shall remain undischarged for a period of
thirty (30) consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to attach or
levy upon any assets of the Borrower or any of its Subsidiaries to enforce any
such judgment;
(m) an ERISA Event shall have occurred that is reasonably likely to result
in a liability or loss to the Borrower or any of its Subsidiaries in an amount
in excess of One Million Dollars ($1,000,000);
(n) a Change in Control shall occur; or
(o) Technologies shall (i) permit the Leverage Ratio as at (A) the last
day of each of its fiscal quarters through and including the fiscal quarter
ending December 30, 2006, to exceed 3.50 to 1.00; or (B) the last day of each of
its fiscal quarters ending after December 30, 2006, to exceed 3.00 to 1.00; or
(ii) permit the Fixed Charges Coverage Ratio to be less than 1.25 to 1.00 as at
the last day of any fiscal quarter ending after the Effective Date.
(p) any Loan Document or Lien granted thereunder shall terminate or cease
to be effective (other than pursuant to its terms) or cease to be legally valid,
binding and enforceable obligation of the Borrower, a Subsidiary Guarantor or a
Parent Guarantor party thereto (other than as a result of any termination in
accordance with the terms thereof); the Borrower, any Subsidiary Guarantor or
Parent Guarantor party to any Loan Documents shall, directly or indirectly,
contest in any manner the effectiveness of any such Loan Document or Lien
granted thereunder or the validity, binding nature, or enforceability thereof;
or any Lien shall cease to have the priority purported to be given under the
applicable Loan Document;
then, and in every such event (other than an event with respect to the Borrower
described in clause (i) or (j) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and
55
(ii) declare the Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower; and
in case of any event with respect to the Borrower described in clause (i) or (j)
of this Article, the Commitments shall automatically terminate and the principal
of the Loans then outstanding, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.
ARTICLE VIII THE ADMINISTRATIVE AGENT
Each of the Lenders and the Issuing Lender hereby irrevocably appoints the
Administrative Agent as its agent hereunder and under the other Loan Documents
and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such actions and powers as are reasonably
incidental thereto.
The Person serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent, and such
Person and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except
those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, (a) the Administrative Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) the Administrative Agent shall not
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or
by the other Loan Documents that the Administrative Agent is required to
exercise in writing by the Required Lenders, and (c) except as expressly set
forth herein and in the other Loan Documents, the Administrative Agent shall not
have any duty to disclose, and shall not be liable for the failure to disclose,
any information relating to the Borrower or any of its Subsidiaries that is
communicated to or obtained by the bank serving as Administrative Agent or any
of its Affiliates in any capacity. The Administrative Agent shall not be liable
for any action taken or not taken by it with the consent or at the request of
the Required Lenders or in the absence of its own gross negligence or willful
misconduct. The Administrative Agent shall be deemed not to have knowledge of
any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein,
(iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in ARTICLE IV or
elsewhere herein or therein, other than to confirm receipt of items expressly
required to be delivered to the Administrative Agent.
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The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and exercise
its rights and powers by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all its duties and exercise its rights and powers through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent.
The Administrative Agent may resign at any time by notifying the Lenders,
the Issuing Lender and the Borrower. Upon any such resignation, the Required
Lenders shall have the right, with the prior written consent of the Borrower
(which consent shall not be unreasonably withheld), to appoint a successor. If
no successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty (30) days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent's resignation shall nonetheless become effective and (1)
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and (2) the Required Lenders shall perform the duties of
the Administrative Agent (and all payments and communications provided to be
made by, to or through the Administrative Agent shall instead be made by or to
each Lender directly) until such time as the Required Lenders appoint a
successor agent as provided for above in this paragraph. Upon the acceptance of
its appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring (or retired) Administrative Agent and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder (if not already discharged therefrom as provided above in this
paragraph). The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent's
resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement.
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Each Lender also acknowledges that it will, independently and without reliance
upon the Administrative Agent or any other Lender and based on such documents
and information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder.
Each Lender acknowledges and agrees that neither such Lender, nor any of
its Affiliates, participants or assignees, may rely on the Administrative Agent
to carry out such Lender's, Affiliate's, participant's or assignee's customer
identification program, or other obligations required or imposed under or
pursuant to the USA Patriot Act or the regulations thereunder, including the
regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the
"CIP Regulations"), or any other Anti-Terrorism Law, including any programs
involving any of the following items relating to or in connection with the
Borrower or any of their Subsidiaries, any of their respective Affiliates or
agents, this Agreement, the Loan Documents or the Transactions hereunder: (a)
any identity verification procedures, (b) any record keeping, (c) any
comparisons with government lists, (d) any customer notices or (e) any other
procedures required under the CIP Regulations or such other laws.
Each Lender or assignee or participant of a Lender that is not organized
under the laws of the United States of America or a state thereof (and is not
excepted from the certification requirement contained in Section 313 of the USA
Patriot Act and the applicable regulations because it is both (a) an affiliate
of a depository institution or foreign bank that maintains a physical presence
in the United States or foreign country, and (b) subject to supervision by a
banking authority regulating such affiliated depository institution or foreign
bank) shall deliver to the Administrative Agent the certification, or, if
applicable, recertification, certifying that such Lender is not a "shell" and
certifying to other matters as required by Section 313 of the USA Patriot Act
and the applicable regulations: (i) within ten (10) days after the Effective
Date, and (ii) at such other times as are required under the USA Patriot Act.
Except as otherwise provided in Section 9.02(b) with respect to this
Agreement, the Administrative Agent may, with the prior consent of the Required
Lenders (but not otherwise), consent to any modification, supplement or waiver
under any of the Loan Documents.
ARTICLE IX MISCELLANEOUS
9.01 Notices. Except in the case of notices and other communications expressly
permitted to be given by telephone, all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by
telecopy, as follows:
(a) if to the Borrower:
Greatbatch Ltd.
10000 Wehrle Drive
Clarence, New York 14031
Tel: (716) 759-5602
Fax: (716) 759-5614
58
Attn: Lawrence P. Reinhold
Treasurer
with a copy to: John P. Amershadian, Esq.
Hodgson Russ LLP
One M&T Plaza
Suite 2000
Buffalo, New York 14203
Tel: (716) 848-1277
Fax: (716) 849-0349
(b) if to the Administrative Agent, Issuing Lender or Swingline Lender:
Manufacturers and Traders Trust Company
One Fountain Plaza
12th Floor
Buffalo, New York 14203
Tel: (716) 848-7303
Fax: (716) 848-7318
Attn: Michael J. Prendergast
Vice President
with a copy to: William E. Mathias, Esq.
Lippes Mathias Wexler Friedman LLP
665 Main Street
Suite 300
Buffalo, New York 14203-1425
Tel: (716) 853-5100
Fax: (716) 853-5199
(c) if to a Lender, to it at its address (or telecopy number) set forth in
Schedule I.
Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto (or,
in the case of any such change by a Lender, by notice to the Borrower and
the Administrative Agent). All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement shall
be deemed to have been given on the date of receipt. Unless otherwise
specified herein, each notice or other communication required or permitted
to be given hereunder by the Borrower shall be given or made only by a
Senior Executive Officer or Financial Officer of the Borrower.
9.02 Waivers; Amendments.
(a) No Deemed Waivers: Remedies Cumulative. No failure or delay by the
Administrative Agent, the Issuing Lender or any Lender in exercising any right
or power hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power,
59
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the Issuing
Lender and the Lenders hereunder are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of
this Agreement or consent to any departure by the Borrower therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan or issuance of a Letter of
Credit shall not be construed as a waiver of any Default, regardless of whether
the Administrative Agent, any Lender or the Issuing Lender may have had notice
or knowledge of such Default at the time.
(b) Amendments. Neither this Agreement nor any provision hereof may be
waived, amended or modified except pursuant to an agreement or agreements in
writing entered into by the Borrower and the Required Lenders or by the Borrower
and the Administrative Agent with the consent of the Required Lenders; provided
that no such agreement shall:
(i) increase the Commitment of any Lender without the written
consent of such Lender,
(ii) reduce the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount
of any Loan or LC Disbursement, or any interest thereon, or any fees
payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment,
without the written consent of each Lender affected thereby,
(iv) change Section 2.15(d) without the consent of each Lender
affected thereby, or
(v) change any of the provisions of this Section or the percentage
in the definition of the term "Required Lenders" or any other provision
hereof specifying the number or percentage of Lenders required to waive,
amend or modify any rights hereunder or make any determination or grant
any consent hereunder,
(vi) release any collateral subject to a Lien in favor of the
Administrative Agent granted pursuant to any Loan Document, or terminate
or modify any Guaranty Agreement (whether now in existence or hereafter
delivered to the Administrative Agent pursuant to the terms hereof),
except in connection with sales in the ordinary course or other
dispositions of Collateral permitted by this Agreement or any other Loan
Document,
without the written consent of each Lender, and provided further that no such
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or the Issuing Lender hereunder without the prior written
consent of the Administrative Agent the Issuing Lender, as the case may be.
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(c) Notwithstanding the foregoing, the Borrower acknowledges and agrees
that the Administrative Agent reserves the right, at any time, after consulting
with the Borrower, to modify pricing, tenor or terms of the Revolving Credit
Facility, but not the principal amount of either of such facilities, if the
Administrative Agent determines, on a commercially reasonable basis, that such
modifications are advisable to ensure successful syndication of the Revolving
Credit Facility.
9.03 Expenses; Indemnity; Damage Waiver.
(a) Costs and Expenses. The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of this
Agreement and the other Loan Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable
out-of-pocket expenses incurred by the Issuing Lender in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder, and (iii) all reasonable out-of-pocket expenses incurred
by the Administrative Agent, the Issuing Lender or any Lender, including the
reasonable fees, charges and disbursements of any counsel for the Administrative
Agent, the Issuing Lender or any Lender, in connection with the enforcement or
protection of its rights in connection with this Agreement and the other Loan
Documents, including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, including in connection with
any workout, restructuring or negotiations in respect thereof.
(b) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent, the Issuing Lender and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "Indemnitee")
against, and to hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement, any of the other Loan
Documents or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
the consummation of the Transactions or any other transactions contemplated
hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for payment under
a Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.
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(c) Reimbursement by Lenders. To the extent that the Borrower fails to pay
any amount required to be paid by it to the Administrative Agent or the Issuing
Lender under paragraph (a) or (b) of this Section, each Lender severally agrees
to pay to the Administrative Agent or the Issuing Lender, as the case may be,
such Lender's Applicable Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount; provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or
asserted against the Administrative Agent or the Issuing Lender in its capacity
as such.
(d) Waiver of Consequential Damages; Etc. To the extent permitted by
applicable law, the Borrower shall not assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.
(e) Payments. All amounts due under this Section shall be payable promptly
after written demand therefor.
9.04 Successors and Assigns.
(a) Assignments; Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that the Borrower may not assign
or otherwise transfer any of its rights or obligations hereunder without the
prior written consent of the Lender and the Lender may not assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an Eligible
Assignee in accordance with the provisions of subsection (b) of this Section,
(ii) by way of participation in accordance with the provisions of subsection (c)
of this Section, or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of subsection (e) of this Section (and any other
attempted assignment or transfer by any party hereto shall be null and void).
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in subsection (c)
of this Section and, to the extent expressly contemplated hereby, the
Indemnitees) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Assignments by Lenders. Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of the Revolving Credit Commitment,
the Loans and LC Exposure at the time owing to it provided that (i) such
assignment shall not be in an amount less than Five Million Dollars
($5,000,000.00) and (ii) the assignee and the assigning Lender shall pay a
processing and recordation fee of Three Thousand Five Hundred Dollars
($3,500.00) and (iii) such assignment shall be pursuant to documentation
acceptable to the Administrative Agent to include at least an Assignment and
Acceptance and Administrative Questionnaire and the assignee, it being
understood and agreed that with respect to any Letters of Credit outstanding at
the time of any such assignment, such Lender may sell to the assignee a ratable
participation in such Letters of Credit.
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From and after the effective date specified in such documentation, such Eligible
Assignee shall be a party to this Agreement and, to the extent of the interest
assigned by any Lender, have the rights and obligations of such Lender under
this Agreement, and the Lender shall, to the extent of the interest so assigned,
be released from its obligations under this Agreement (and, in the case of an
assignment of all of the Lender's rights and obligations under this Agreement,
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.12, 2.13, 2.14 and 9.03 with respect to facts and
circumstances occurring prior to the effective date of such assignment, and
shall continue to have all of the rights provided hereunder to such Lender in
its capacity as issuer of any Letters of Credit outstanding at the time of such
assignment). Upon request, the Borrower (at its expense) shall execute and
deliver new or replacement notes to the Lender and the assignee, and shall
execute and deliver any other documents reasonably necessary or appropriate to
give effect to such assignment and to provide for the administration of this
Agreement after giving effect thereto.
(c) Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrower, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower's Affiliates or Subsidiaries)
(each, a "Participant") in all or a portion of the Lender's rights and/or
obligations under this Agreement (including all or a portion of its Revolving
Credit Commitment and/or LC Exposure and/or the Loans and/or the reimbursement
obligations in respect of Letters of Credit); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the Borrower for the performance of such
obligations and (iii) the Borrower shall continue to deal solely and directly
with the Administrative Agent in connection with any Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
any Lender sells such a participation shall provide that the Administrative
Agent, on behalf of the Lenders, shall retain the sole right to enforce this
Agreement and the Administrative Agent, with the consent of the Required Lenders
shall approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that the
Administrative Agent and the Lenders will not, without the consent of the
Participant, agree to any amendment, waiver or other modification that would (i)
postpone any date upon which any payment of money is scheduled to be made to
such Participant, or (ii) reduce the principal, interest, fees or other amounts
payable to such Participant (provided, however, that the Lender may, without the
consent of the Participant, (A) amend any financial covenant hereunder (or any
defined term used therein) even if the effect of such amendment would be to
reduce the rate of interest on any Loan or Letter of Credit reimbursement
obligation or to reduce any fee payable hereunder and (B) waive the right to be
paid interest at the Default Rate), or (iii) release any the Guarantor from its
Guaranty Agreement. Subject to subsection (d) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.12,
2.13 and 2.14 to the same extent as if it were the Lender and had acquired its
interest by assignment pursuant to subsection (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender.
(d) Limitations on Rights of Participants. A Participant shall not be
entitled to receive any greater payment under Section 2.12 or 2.14 than the
Lender would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower's prior written consent. A Participant
that is not a "United States person" within the meaning of Section 7701(a)(30)
of the Code shall not be entitled to the benefits of Section 2.14 unless the
Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to provide to the Lender
such tax forms prescribed by the IRS as are necessary or desirable to establish
an exemption from, or reduction of, U.S. withholding tax.
63
(e) Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under the Note, if any) to secure obligations of the Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release the Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
the Lender as a party hereto.
(f) No Assignments to the Borrower or Affiliates. Anything in this Section
to the contrary notwithstanding, no Lender may assign or participate any
interest in any Loan or LC Exposure held by it hereunder to the Borrower or any
of its Affiliates or Subsidiaries without the prior consent of each Lender.
9.05 Survival. All covenants, agreements, representations and warranties made by
the Borrower herein and in the certificates or other instruments delivered in
connection with or pursuant to this Agreement shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of this Agreement and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the Issuing
Lender or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated. The
provisions of Sections 2.12, 2.13, 2.14 and 9.03 and Article VIII shall survive
and remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Letters of Credit and the Commitments or the termination of
this Agreement or any provision hereof.
9.06 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement and any separate letter
agreements with respect to fees payable to the Administrative Agent constitute
the entire contract between and among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in Section
4.01, this Agreement shall become effective when it shall have been executed by
the Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Agreement.
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9.07 Severability. Any provision of this Agreement held to be invalid, illegal
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.
9.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, subject to the provisions of Section 2.15 each Lender is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Lender to or for the credit or the account of the Borrower
against any of and all the obligations of the Borrower now or hereafter existing
under this Agreement held by such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement and although such
obligations may be unmatured. The rights of each Lender under this Section are
in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
9.09 Governing Law; Jurisdiction: Etc.
(a) Governing Law. This Agreement shall be construed in accordance with
and governed by the law of the State of New York, without regard to its
principles of conflicts of laws.
(b) Submission to Jurisdiction. The Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in Erie
County and of the United States District Court of the Western District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right that the
Administrative Agent, the Issuing Lender or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement against the Borrower
or its properties in the courts of any jurisdiction.
(c) Waiver of Venue. The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
(d) Service of Process. Each party to this Agreement irrevocably consents
to service of process in the manner provided for notices in Section 9.01.
Nothing in this Agreement will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.
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9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
9.11 Headings. Article and Section headings and the Table of Contents used
herein are for convenience of reference only, are not part of this Agreement and
shall not affect the construction of, or be taken into consideration in
interpreting, this Agreement.
9.12 Treatment of Certain Information: Confidentiality.
(a) Treatment of Certain Information. The Borrower acknowledges that from
time to time financial advisory, investment banking and other services may be
offered or provided to the Borrower or one or more of its Subsidiaries (in
connection with this Agreement or otherwise) by any Lender or by one or more
subsidiaries or affiliates of such Lender and the Borrower hereby authorizes
each Lender to share any information delivered to such Lender by the Borrower
and its Subsidiaries pursuant to this Agreement, or in connection with the
decision of such Lender to enter into this Agreement, to any such subsidiary or
affiliate, it being understood that any such subsidiary or affiliate receiving
such information shall be bound by the provisions of paragraph (b) of this
Section as if it were a Lender hereunder. Such authorization shall survive the
repayment of the Loans, the expiration or termination of the Letters of Credit
and the Commitments or the termination of this Agreement or any provision
hereof.
(b) Confidentiality. Each of the Administrative Agent, the Issuing Lender
and the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (i) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (ii) to the
extent requested by any regulatory authority, (iii) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (iv)
to any other party to this Agreement, (v) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any suit, action or
proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (vi) subject to an agreement
containing provisions substantially the same as those of this paragraph, to any
assignee of or Participant in, or any prospective assignee of or Participant in,
any of its rights or obligations under this Agreement, (vii) with the consent of
the Borrower or (viii) to the extent such Information (A) becomes publicly
available other than as a result of a breach of this paragraph or (B) becomes
66
available to the Administrative Agent, the Issuing Lender or any Lender on a
nonconfidential basis from a source other than the Borrower. For the purposes of
this paragraph, "Information" means all information received from the Borrower
relating to the Borrower or its business, other than any such information that
is available to the Administrative Agent, the Issuing Lender or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; provided that, in the
case of information received from the Borrower after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information
9.13 USA Patriot Act. Each Lender subject to the USA Patriot Act hereby notifies
the Borrower that pursuant to the requirements of the USA Patriot Act, it is
required to obtain, verify and record information that identifies the Borrower,
which information includes the name and address of the Borrower and other
information that will allow such Lender to identify the Borrower in accordance
with the USA Patriot Act.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
GREATBATCH LTD.
By: /s/ Lawrence P. Reinhold
---------------------------------
Name: Lawrence P. Reinhold
Title: Treasurer
LENDERS
- -------
MANUFACTURERS AND TRADERS TRUST COMPANY, as Administrative Agent and Lead
Arranger
By: /s/ Michael J. Prendergast
---------------------------------
Name: Michael J. Prendergast
Title: Vice President
MANUFACTURERS AND TRADERS TRUST COMPANY, for itself and as Swingline Lender and
as Issuing Lender
By: /s/ Michael J. Prendergast
---------------------------------
Name: Michael J. Prendergast
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Mark F. Wachowiak
---------------------------------
Name: Mark F. Wachowiak
Title: Vice President
HSBC BANK USA, NATIONAL ASSOCIATION
By: /s/ John G. Tierney
---------------------------------
Name: John G. Tierney
Title: Vice President
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BANK OF AMERICA, N.A.
By: /s/ Kenneth Burton
---------------------------------
Name: Kenneth Burton
Title: Vice President
FIRST NIAGARA FUNDING, INC.
By: /s/ Jerome J. Jacobi
---------------------------------
Name: Jerome J. Jacobi
Title: Vice President
69