<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
---------------
FORM 10-Q
[x]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 2000
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _______ To ______
Commission File Number 1-584
---------------
FERRO CORPORATION
(Exact Name of Registrant as specified in its charter)
An Ohio Corporation 1000 LAKESIDE AVENUE CLEVELAND, OH 44114 IRS No. 34-0217820
(Address of principal executive offices)
Registrant's telephone number including area code: 216/641-8580
---------------------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
At April 30, 2000, there were 34,673,033 shares of Ferro common stock, par value
$1.00, outstanding.
1
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FERRO CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three Months Ended
March 31
(Unaudited) (Unaudited)
(Dollars in Thousands, except per share amounts) 2000 1999
- ------------------------------------------------------------------------------------------
<S> <C> <C>
Segment Sales
Coatings $ 219,335 $ 199,194
Chemicals 71,212 71,473
Plastics 70,065 60,814
------------ ------------
Total Net Sales $ 360,612 $ 331,481
Cost of Sales 260,542 239,265
Selling, Administrative and General Expenses 63,948 59,744
Other Charges (Credits):
Interest Expense 5,626 3,918
Net Foreign Currency Gain (368) (169)
Other Expense - Net 1,395 1,358
------------ ------------
Income Before Taxes 29,469 27,365
Income Tax Expense 11,069 10,264
------------ ------------
Net Income 18,400 17,101
Dividend on Preferred Stock, Net of Tax 906 952
------------ ------------
Net Income Available to Common Shareholders $ 17,494 $ 16,149
============ ============
Per Common Share Data:
Basic Earnings $ 0.50 $ 0.46
Diluted Earnings $ 0.48 $ 0.43
Shares Outstanding:
Average Outstanding 34,914,494 35,011,194
Average Diluted 38,022,573 38,619,466
Actual End of Period 34,741,183 34,965,029
- -----------------------------------------------------------------------------------------
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements
2
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CONDENSED CONSOLIDATED BALANCE SHEETS
FERRO CORPORATION AND SUBSIDIARIES
MARCH 31, 2000 AND DECEMBER 31, 1999
<TABLE>
<CAPTION>
(Dollars in Thousands)
(Unaudited) (Audited)
ASSETS 2000 1999
====== --------- --------
<S> <C> <C>
Current Assets:
Cash and Cash Equivalents $ 10,445 $ 7,114
Net Receivables 270,199 261,501
Inventories 168,442 170,663
Other Current Assets 54,196 51,251
--------- --------
Total Current Assets 503,282 490,529
Net Plant & Equipment 326,065 330,393
Unamortized Intangibles 93,509 93,412
Miscellaneous Other Assets 53,535 57,416
--------- --------
$ 976,391 $971,750
LIABILITIES
===========
Current Liabilities:
Notes and Loans Payable $ 52,530 $ 45,939
Accounts Payable 123,371 131,923
Income Taxes 11,956 6,777
Accrued Payrolls 17,234 19,246
Accrued Expenses and Other Current Liabilities 126,630 133,748
--------- --------
Total Current Liabilities 331,721 337,633
Long - Term Debt 251,391 236,794
Postretirement Liabilities 50,117 49,712
Other Non-Current Liabilities 44,702 50,616
Shareholders' Equity 298,460 296,995
--------- --------
$ 976,391 $971,750
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements
3
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FERRO CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three Months Ended
March 31
(Unaudited) (Unaudited)
(Dollars in Thousands) 2000 1999
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Net Cash Provided by Operating Activities $ 6,852 $ 53,083
Cash Flow from Investing Activities:
Capital Expenditures for Plant and Equipment (10,094) (28,628)
Acquisition of Companies, net of cash acquired (1,900) (29,905)
Other Investing Activities 156 2,850
- ----------------------------------------------------------------------------------------
Net Cash Used by Investing Activities (11,838) (55,683)
Cash Flow from Financing Activities:
Net Borrowings Under Short-Term Lines 6,591 25,801
Proceeds from Long-Term Debt 15,013 1,572
Purchase of Treasury Stock (8,100) (8,640)
Cash Dividend Paid (5,973) (5,667)
Other Financing Activities 826 340
- ----------------------------------------------------------------------------------------
Net Cash Provided by Financing Activities 8,357 13,406
Effect of Exchange Rate Changes on Cash (40) (276)
- ----------------------------------------------------------------------------------------
Increase in Cash and Cash Equivalents 3,331 10,530
Cash and Cash Equivalents at Beginning of Period 7,114 12,185
- ----------------------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period $ 10,445 $ 22,715
- ----------------------------------------------------------------------------------------
Cash Paid During the Period for:
Interest, net of amounts capitalized $ 3,829 $ 627
Income Taxes $ 790 $ 2,088
- ----------------------------------------------------------------------------------------
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements
4
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FERRO CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The condensed consolidated interim financial statements should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's annual report on Form 10-K for the fiscal year
ended December 31, 1999. The information furnished herein reflects all
adjustments (consisting solely of normal recurring adjustments) which are,
in the opinion of management, necessary for fair presentation of the
results for the interim periods. The results of the three months ended
March 31, 2000 are not necessarily indicative of the results expected in
subsequent quarters or for the full year.
2. Comprehensive Income
Comprehensive income represents net income adjusted for foreign currency
translation adjustments and pension liability adjustments. Comprehensive
income (loss) was $14.2 million and ($2.0) million for the three months
ended March 31, 2000 and 1999, respectively. Accumulated other
comprehensive income (loss) at March 31, 2000 and December 31, 1999 was
($78.7) million and ($74.5) million, respectively.
3. Contingent Liabilities
The Company is party to administrative proceedings relating to emissions
from its plant in Hammond, Indiana. In these proceedings, the United States
Environmental Protection Agency (U.S. EPA) is seeking to impose fines and
possibly to alter or terminate the Company's right to produce Pyro-Chek(R)
at the Hammond plant (see the description in Part II Item 1). The Company
is vigorously contesting these claims and evaluating alternatives for
mitigating the impact should the Company not prevail. If the U.S. EPA were
to prevail on all of its claims, it could have a material adverse effect on
the Company. However, the Company believes that it will resolve this matter
in a manner that will not have a material adverse effect.
At the prompting of several residents near Hammond, Indiana, U.S.
Congressional Representative Visclosky has requested the U. S. Department
of Health's Agency for Toxic Substances and Disease Registry (ATSDR) to
investigate a possible "cluster" of pediatric cancers of the central
nervous system found in the Hammond area and to assess whether operations
of the Company's Hammond facility pose an unreasonable risk to health or
the environment. The Company has had an initial meeting with
representatives of the ATSDR, and intends to cooperate with all reasonable
requests in connection with the evaluations.
There are also pending against the Company and its consolidated
subsidiaries various other lawsuits and claims. In the opinion of
management, the ultimate liabilities resulting from such other lawsuits and
claims will not materially affect the consolidated financial position or
results of operations or liquidity of the Company.
5
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4. Earnings Per Share Computation
Three Months Ended
March 31
-----------------------
2000 1999
---------- ----------
Average Shares Outstanding
Basic 34,914,494 35,011,194
Adjustments for assumed conversion of
convertible preferred stock and
common stock options 3,108,079 3,608,272
---------- ----------
Diluted 38,022,573 38,619,466
Basic earnings per share is computed as net income available to common
shareholders divided by average basic shares outstanding.
Diluted earnings per share is computed as net income adjusted for the tax effect
associated with assumed conversion of preferred stock to common stock divided by
average diluted shares outstanding.
5. Reporting for Segments
The Company's reportable segments are Coatings, Chemicals and Plastics.
Coatings products include ceramic glaze coatings, inorganic color, powder
and porcelain enamel coatings and electronic materials. Chemicals consists
of polymer additives, petroleum additives, flame retardants, and
performance and fine chemicals. The Plastics segment derives its revenues
mostly from plastic colorants and filled and reinforced plastic compounds.
The Company measures segment profit for internal reporting purposes as net
operating profit before interest and tax. Excluded from net operating
profit are certain unallocated corporate expenses. A complete
reconciliation of segment income to consolidated income before tax is
presented below.
Sales to external customers are presented in the following chart.
Intersegment sales are not material.
FERRO CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
(Dollars in Thousands)
SEGMENT SALES 2000 1999
-----------------------------------------------------------------
Coatings $ 219,335 $ 199,194
Chemicals 71,212 71,473
Plastics 70,065 60,814
-----------------------------------------------------------------
Total $ 360,612 $ 331,481
Income and reconciliation to income before taxes follows:
SEGMENT INCOME
-----------------------------------------------------------------
Coatings $ 25,714 $ 23,546
Chemicals 9,283 8,438
Plastics 5,690 6,027
-----------------------------------------------------------------
Total $ 40,687 $ 38,011
Unallocated Expenses 4,601 5,539
Interest Expense 5,626 3,918
Foreign Currency Gain (368) (169)
Other Expense-Net 1,359 1,358
-----------------------------------------------------------------
Income Before Taxes $ 29,469 $ 27,365
=================================================================
Unallocated expenses consist primarily of corporate costs.
6
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ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
First quarter 2000 net sales of $360.6 million were 8.8% higher than the $331.5
million of the comparable 1999 period. Sales increased 10.1% in the Coatings
segment and 15.2% in the Plastics segment. Chemicals' sales were essentially
even with the first quarter of 1999.
The increase in sales was driven by a combination of strong organic volume
growth, and the contribution of acquisitions made in 1999. The increase in
volumes was driven by solid performances in the plastic compounding and
electronic materials businesses domestically and by improved performance in both
Europe and Asia generally. Overall volume improvement was significant enough to
overcome a 4% negative impact from foreign currency translation. In particular,
the Euro continued to weaken compared to the U.S. dollar and decreased 12% in
value on average compared to the first quarter of 1999.
Gross margin was equal to the first quarter of 1999 at 27.8% of sales. Margins
were impacted by foreign currency translation and significant increases in the
price of several key raw materials in the Plastics segment.
Selling, administrative and general expenses increased 7.0%, a slightly lower
rate than sales. Increased costs were associated with higher selling expenses
and the selling, administrative and general expenses associated with the
acquisitions the Company completed in 1999. As percentage of sales these costs
were lower at 17.7% versus 18.0% in the first quarter of 1999.
Net income for the quarter climbed to $18.4 million, a quarterly earnings
record, compared to $17.1 earned in the first quarter of 1999. Earnings of $0.48
(diluted) per share, increased 11.6% compared to the $0.43 earned in the 1999
first quarter, equaling an all-time quarterly record.
SEGMENT RESULTS
First quarter sales for the Coatings segment improved by 10.1% compared with the
1999 first quarter. The sales improvement was driven by a significant increase
in sales of electronic materials, which now represent approximately 20% of the
segment's sales. Electronic materials recorded strong volume improvement in
existing products and benefited from the contribution of sales from the TAM
Ceramics acquisition made in July 1999. Additionally, growth in Europe and Asia
helped the tile business drive volume improvement. Sales growth for this segment
would have been significantly higher had it not been for negative foreign
currency translation. Coatings is the most international segment within the
Company and therefore is significantly impacted by changes in foreign currency
exchange rates. Segment income increased 9.2% to $25.7 million compared with
$23.5 million in the 1999 first quarter, driven by sales growth.
Chemicals' sales were $71.2 million compared with $71.5 million in the first
quarter of 1999. Sales were impacted by the segment's continuing strategy of
improving the mix of products by eliminating low-margin sales and focusing on
more value-added applications. Segment income increased 10.0%, reflecting higher
margins from a better mix of products sold and from lower raw material costs.
7
<PAGE> 8
The Plastics segment generated the strongest sales improvement, a 15.2% increase
to $70.1 million compared with $60.8 million in the first quarter of 1999. This
segment continued to drive significant volume growth in the existing business,
particularly in glass and mineral-filled polypropylene compounds. The Company
has plans to increase capacity for certain of these compounds later this year to
keep pace with market demand. Internal growth was complemented by the
contribution of the APC acquisition, which the Company completed in March 1999.
Segment income was $5.7 million compared with $6.0 million in the first quarter
of 1999. Increasing prices for raw materials had a negative impact on margins.
The company continues to pursue an aggressive pricing strategy to offset the
increase in raw material costs.
GEOGRAPHIC SALES
Sales in the United States were $209.2 million for the three months ended March
31, 2000 compared with $182.3 million for the three months ended March 31, 2000.
The increase in sales in the United States was driven by significant
improvements in both the plastic compounding and electronic materials businesses
and by two domestic acquisitions made in 1999. International sales were $151.4
million for the three months ended March 31, 2000 compared with $149.2 million
in the three months ended March 31, 1999. The increase in international sales is
primarily due to improved volumes in Europe and Asia offset by the significant
impact of negative foreign currency translation.
LIQUIDITY AND CAPITAL RESOURCES
The Company's liquidity requirements include capital investments, working
capital requirements, acquisitions, and to a lesser extent, interest expense.
The Company expects to be able to meet its working capital requirements and
capital investment needs from cash and cash equivalents, cash flow from
operations and, if necessary, use of its revolving credit facility or long-term
borrowings. The Company has available a $300 million five-year revolving credit
facility with seven domestic banks. The Company had borrowed $110 million under
this facility as of March 31, 2000. The Company is actively pursuing its
acquisition strategy and may, from time to time, use its existing revolving
credit facility or alternate financing arrangements, including divestitures, to
fund acquisitions. The Company also has $245.0 million of availability under a
universal shelf registration pursuant to which various types of public
securities may be issued.
Net cash provided from operating activities, for the three months ended March
31, 2000, was $6.9 million compared to the $53.1 million recorded in the first
quarter of 1999. In the 1999 quarter, the Company's trade accounts payable
increased $24.6 million, whereas in the current quarter, trade accounts payable
decreased $8.6 million reflecting payments on raw material inventory purchased
late in 1999 to secure supply in anticipation of the Year 2000 computer
conversion. Net cash used for investing activities decreased by $43.8 million
compared to the first quarter of 1999, reflecting a lower level of capital
expenditures for plant and equipment and acquisitions.
8
<PAGE> 9
ENVIRONMENTAL
The Company received "Notices of Violation" from the United States Environmental
Protection Agency in 1999 alleging that the Company violated various
requirements of the Clean Air Act and related State laws in modifying and
operating the Pyro-Chek process at its facility in Hammond, Indiana. See the
description in Part II, Item 1 to this Form 10-Q. The Company has announced its
intention to sell the assets relating to the Pyro-Chek process and cease
production of Pyro-Chek at Hammond. Following the sale of the assets and
cessation of Pyro-Chek production, the Company will continue to be responsible
for any claims relating to all past operations at Hammond, including Pyro-Chek
production. The Company is vigorously contesting these claims. If the matter
cannot be resolved through negotiation, and the United States pursues and
recovers the maximum potential penalties on all of its claims, it could have a
material adverse affect on the Company. However, the Company believes that it
will resolve this matter in a manner that will not have a material adverse
affect.
Additionally, governmental agencies have identified several disposal sites for
clean-up under the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA," or the Superfund) and similar laws to which the Company
has been named a "potentially responsible party." The Company is participating
in the cost of certain clean-up efforts. However, the Company's share of such
costs has not been material and is not expected to have a material adverse
impact on the Company's financial condition or results of operations.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this quarterly report on Form 10-Q reflect the
Company's current expectations with respect to the future performance of the
Company and may constitute "forward-looking statements" within the meaning of
the federal securities laws. These statements are subject to a variety of
uncertainties, unknown risks and other factors concerning the Company's
operations and business environment, and actual events or results may differ
materially from the results discussed in the forward-looking statements. Factors
that could cause or contribute to such differences include, but are not limited
to: the success of the Company's acquisition program; market acceptance of new
product introductions; changes in customer requirements, markets or industries
served; changing economic conditions, particularly in Europe, Asia-Pacific,
Latin America and the United States; foreign exchange rates, especially in
Europe, Latin America and Asia-Pacific; changes in the prices of major raw
materials; significant technological or competitive developments; and the impact
of environmental proceedings discussed herein under the heading "Environmental"
in Management's Discussion and Analysis.
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK FACTORS.
There have been no material changes in market risk exposures during the first
three months of 2000 that effect the disclosures presented in the Company's
Annual Report to Shareholders on Form 10-K for the year ended December 31, 1999,
which disclosure is incorporated here by reference.
9
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PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
In 1994, the Company's Keil Chemical Division (Keil) settled an enforcement
proceeding brought by the Indiana Department of Environmental Management (IDEM)
concerning air emissions from Keil's Pyro-Chek (R) process. The settlement was
in the form of an Agreed Order with IDEM. The Agreed Order confirmed the
Company's plans to install additional controls and imposed certain aggregate
limitations on air emissions from the Pyro-Chek (R) production process while the
Company applied for and obtained a construction and operating permit for the
existing air source. The control equipment was installed, but the Company has
had a continuing disagreement with the agency over whether it has been in
compliance with the Agreed Order, including which methods should be used to
demonstrate compliance.
In November 1998, IDEM filed suit in Indiana state court seeking to shut down
operation of the Pyro-Chek (R) process. At a hearing held on December 4, 1998,
the court denied IDEM's request for a preliminary injunction, and later
dismissed the claim for a permanent injunction on grounds that the dispute
arising out of the Agreed Order should be addressed before the Indiana Office of
Environmental Adjudication. The day before this hearing, IDEM denied Keil's
application for a permit for air emissions for the Pyro-Chek (R) process. The
Company appealed IDEM's denial of Keil's permit application to the Indiana
Office of Environmental Adjudication.
On December 29, 1998, IDEM wrote to the Company alleging that because Keil is in
violation of the Agreed Order operation of the Pyro-Chek(R) process is
prohibited, and that the Company will be subject to fines of up to $25,000 for
each day of continued operation. The Company filed a petition for review before
the Indiana Office of Environmental Adjudication seeking to confirm that
operation of the Pyro-Chek(R) process has been and remains in compliance with
the Agreed Order. On February 24, 1999, IDEM withdrew its December 29, 1998
letter alledging that Keil was in violation of the Agreed Order and that the
Pro-Chek process was prohibited. On March 15, 1999, the Company's petition for
review was dismissed without objection.
On May 4, 1999, and December 16, 1999, the United States Environmental
Protection Agency (U.S.EPA) issued "Notices of Violation" (NOVs) alleging that
the Company violated various requirements of the Clean Air Act and related State
laws in modifying and operating the Pyro-Chek(R) process. The Company has met
with U.S.EPA and entered into negotiations intended to resolve the issues raised
in the NOVs. If these issues are not resolved in negotiations, the United States
may bring an enforcement action against the Company based on the violations
alleged in the NOVs. If the United States were to initiate such an action and
prevail on all claims, it could have a material adverse effect on the Company.
However, the Company believes that it will resolve this matter in a manner that
will not have a material adverse effect.
There are also pending against the Company and its consolidated subsidiaries
various other lawsuits and claims. In the opinion of management, the ultimate
liabilities resulting from such other lawsuits and claims will not materially
affect the consolidated financial position or results of operations or liquidity
of the Company.
10
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ITEM 2 - CHANGE IN SECURITIES.
No change.
ITEM 3 - DEFAULT UPON SENIOR SECURITIES.
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
At the Annual Meeting of Shareholders held on April 28, 2000, there
were a total of 32,368,300.175 shares voted either in person or
by proxy. The shareholders:
A. Elected three directors to the Ferro Corporation Board of
Directors, Glenn R. Brown, William E. Butler, John C. Morley and
Hector R. Ortino to serve on the Board until the meeting in the
year 2003.
The results of the voting for directors were as follows:
NUMBER OF VOTES FOR
Glenn R. Brown 31,909,225.125
William E. Butler 31,929,454.454
John C. Morley 31,915,834.617
Hector R. Ortino 31,805,144.480
The terms of office for Sandra Austin Crayton, Albert C.
Bersticker, Michael H. Bulkin, William B. Lawrence, William J.
Sharp and Dennis W. Sullivan continued after the meeting.
B. Approved a proposal to amend the Amended and Restated Employee
Stock Option Plan. The holders of 27,742,041.323 shares voted in
favor of the proposal. The holders of 1,846,155.057 shares voted
against the proposal. The holders of 320,714.795 shares abstained
from voting on the issue.
C. Approved a proposal to amend the Performance Share Plan. The
holders of 30,825,149.889 shares voted in favor of the proposal.
The holders of 1,362,302.339 shares voted against the proposal.
The holders of 180,845.947 shares abstained from voting on
the issue.
D. Approved a proposal to ratify the designation of KPMG LLP as
independent auditors of the books and accounts of the Company for
the current year ending December 31, 1999. The holders of
32,037,274.991 shares voted in favor of the proposal. The holders
of 272,591.282 shares voted against the proposal. The holders of
58,433.902 shares abstained from voting on the issue.
ITEM 5 - OTHER INFORMATION.
None.
11
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ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K.
(a) The exhibits listed in the attached Exhibit Index are filed
pursuant to Item 6(a) of the Form 10-Q.
(b) The Company has not filed any reports on Form 8-K for the quarter
ended March 31, 2000.
12
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FERRO CORPORATION
(Registrant)
Date: May 15, 2000
/s/ Hector R. Ortino
------------------------------------
Hector R. Ortino
Chairman and Chief Executive Officer
Date: May 15, 2000
/s/ Bret W. Wise
------------------------------------
Bret W. Wise
Senior Vice President and Chief
Financial Officer
13
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EXHIBIT INDEX
The following exhibits are filed with this report or are incorporated here by
reference to a prior filing in accordance with Rule 12b-32 under the Securities
and Exchange Act of 1934. (Asterisk denotes exhibits filed with this report).
Exhibit:
(3) Articles of Incorporation and by-laws
(a) Eleventh Amended Articles of Incorporation. (Reference is made to
Exhibit (3)(a) to Ferro Corporation's Quarterly Report on Form 10-Q for
the three months ended June 30, 1998 which Exhibit is incorporated here
by reference.)
(b) Certificate of Amendment to the Eleventh Amended Articles of
Incorporation of Ferro Corporation filed December 28, 1994. (Reference
is made to Exhibit (3)(b) to Ferro Corporation's Quarterly Report on
Form 10-Q for the three months ended June 30, 1998 which Exhibit is
incorporated here by reference.)
(c) Certificate of Amendment to the Eleventh Amended Articles of
Incorporation of Ferro Corporation filed January 19, 1998. (Reference is
made to Exhibit (3)(c) to Ferro Corporation's Quarterly Report on Form
10-Q for the three months ended June 30, 1998, which Exhibit is
incorporated here by reference.)
(d) Amended Code of Regulations. (Reference is made to Exhibit (3)(d) to
Ferro Corporation's Quarterly Report on Form 10-Q for the three months
ended June 30, 1998, which Exhibit is incorporated here by reference.)
(4) Instruments defining rights of security holders, including indentures
*(a) Revolving Credit Agreement by and between Ferro and seven
commercial banks dated May 9, 2000.
(b) Amended and Restated Shareholder Rights Agreement between Ferro
Corporation and National City Bank, Cleveland, Ohio, as Rights Agent,
dated as of December 10, 1999. (Reference is made to Exhibit 4(k) to
Ferro Corporation's Form10-K for the year ended December 31, 1999, which
Exhibit is incorporated here by reference.)
(c) The rights of the holders of Ferro's Debt Securities issued and to
be issued pursuant to an Indenture between Ferro and Society National
Bank, as Trustee, are described in the form of Indenture dated May 1,
1993 filed as exhibit 4(j) to Ferro Corporation's Form 10-Q for the
three months ended June 30, 1993. Said Exhibit is incorporated here by
reference.
(d) The rights of the holders of Ferro's Debt Securities issued and to
be issued pursuant to a Senior Indenture between Ferro and Chase
Manhattan Trust Company, National Association, as Trustee, are described
in the Senior Indenture, dated March 25, 1998. (Reference is made
14
<PAGE> 15
to Exhibit 4 (c) to Ferro Corporation's Quarterly Report on Form 10-Q
for the three months ended March 31,1998.)
(e) Form of Security (7 1/8% Debentures due 2028). (Reference is made
toExhibit 4(a-1) to Ferro Corporation's Form 8-K filed March 31, 1998,
which Exhibit is incorporated here by reference.)
*(12) Ratio of Earnings to Fixed Charges.
*(27) Financial Data Schedule for the Quarter Ended March 31, 2000 (Electronic
Filing Only)
15
<PAGE> 1
================================================================================
================================================================================
$300,000,000
CREDIT AGREEMENT
dated as of
May 9, 2000
Among
FERRO CORPORATION
as Borrower
THE LENDING INSTITUTIONS NAMED THEREIN
as Lenders
KEYBANK NATIONAL ASSOCIATION
as a Lender and as Syndication Agent
BANK ONE, MICHIGAN
as a Lender and as Documentation Agent
NATIONAL CITY BANK
as a Lender, the Swing Line Lender, the Letter of Credit Issuer,
the Lead Arranger and the Administrative Agent
================================================================================
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
SECTION 1. DEFINITIONS AND TERMS ........................................................ 1
1.1. Certain Defined Terms ............................................... 1
1.2. Computation of Time Periods ......................................... 15
1.3. Accounting Terms .................................................... 15
1.4. Terms Generally ..................................................... 15
SECTION 2. AMOUNT AND TERMS OF LOANS .................................................... 16
2.1. Commitments for Revolving Loans 16
2.2. Procedures for Revolving Borrowing and Disbursement of Funds ........ 16
2.3. Competitive Bid Loans ............................................... 18
2.4. Notes; Loan Accounts ................................................ 21
2.5. Conversions of General Revolving Loans .............................. 22
2.6. Refunding of, or Participation in, Swing Line Revolving Loans ....... 23
2.7. Interest ............................................................ 24
2.8. Selection and Continuation of Interest Periods ...................... 26
2.9. Increased Costs, Illegality, etc. ................................... 27
2.10. Compensation ........................................................ 29
2.11. Change of Lending Office; Replacement of Lenders .................... 29
SECTION 3. LETTERS OF CREDIT ............................................................ 30
3.1. Letters of Credit ................................................... 30
3.2. Letter of Credit Requests: Notices of Issuance ...................... 30
3.3. Agreement to Repay Letter of Credit Drawings ........................ 31
3.4. Letter of Credit Participations ..................................... 31
3.5. Increased Costs ..................................................... 33
3.6. Guaranty of Letter of Credit Obligations of Other Letter
of Credit Obligors ................................................ 33
SECTION 4. FEES; COMMITMENTS ............................................................ 35
4.1. Fees ................................................................ 35
4.2. Voluntary Termination/Reduction of Commitments ...................... 36
4.3. Mandatory Adjustments of Commitments, etc. .......................... 36
4.4. Extension of Maturity Date .......................................... 37
SECTION 5. PAYMENTS ..................................................................... 37
5.1. Voluntary Prepayments of Loans ..................................... 37
5.2. Mandatory Prepayments ............................................... 38
5.3. Method and Place of Payment ......................................... 39
5.4. Net Payments ........................................................ 39
SECTION 6. CONDITIONS PRECEDENT ......................................................... 40
6.1. Conditions Precedent at Closing Date ................................ 40
6.2. Conditions Precedent to All Credit Events
(Other than any Competitive Bid Borrowing) ........................ 41
6.3. Conditions Precedent to Each Competitive Bid Borrowing .............. 41
SECTION 7. REPRESENTATIONS AND WARRANTIES ............................................... 42
7.1. Corporate Status, etc. .............................................. 42
7.2. Subsidiaries ........................................................ 42
7.3. Corporate Power and Authority, etc. ................................. 42
</TABLE>
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7.4. No Violation ........................................................ 42
7.5. Governmental Approvals .............................................. 43
7.6. Litigation .......................................................... 43
7.7. Use of Proceeds; Margin Regulations ................................. 43
7.8. Financial Statements, etc. .......................................... 43
7.9. No Material Adverse Change. ......................................... 43
7.10. Tax Returns and Payments ............................................ 43
7.11. Title to Properties, etc. ........................................... 44
7.12. Lawful Operations, etc. ............................................. 44
7.13. Environmental Matters ............................................... 44
7.14. Compliance with ERISA ............................................... 44
7.15. Intellectual Property, etc. ......................................... 45
7.16. Investment Company .................................................. 45
7.17. Burdensome Contracts; Labor Relations ............................... 45
7.18. Existing Indebtedness 45
7.19. True and Complete Disclosure ........................................ 45
SECTION 8. AFFIRMATIVE COVENANTS ........................................................ 46
8.1. Reporting Requirements .............................................. 46
8.2. Books, Records and Inspections ...................................... 47
8.3. Insurance ........................................................... 48
8.4. Payment of Taxes and Claims ......................................... 48
8.5. Corporate Franchises ................................................ 48
8.6. Good Repair ......................................................... 48
8.7. Compliance with Statutes, etc. ...................................... 48
8.8. Compliance with Environmental Laws .................................. 48
8.9. Fiscal Years, Fiscal Quarters ....................................... 48
8.10. Hedge Agreements, etc. .............................................. 49
8.11. Certain Subsidiaries to Join in Subsidiary Guaranty ................. 49
8.12. Most Favored Covenant Status ........................................ 49
8.13. Senior Debt ......................................................... 50
SECTION 9. NEGATIVE COVENANTS ........................................................... 50
9.1. Changes in Business ................................................. 50
9.2. Consolidation, Merger, Asset Sales, etc. ............................ 50
9.3. Restrictions on Secured Debt ........................................ 51
9.4. Limitation on Sales and Leasebacks .................................. 52
9.5. Indebtedness ........................................................ 53
9.6. Consolidated Total Debt/Consolidated EBITDA Ratio ................... 53
9.7. Interest Coverage Ratio ............................................. 53
9.8. No Stock Repurchases While Index Debt is Not Investment Grade, etc .. 53
9.9. Transactions with Affiliates ........................................ 53
9.10. Plan Terminations, Minimum Funding, etc. ............................ 54
SECTION 10. EVENTS OF DEFAULT ............................................................ 54
10.1. Events of Default ................................................... 54
10.2. Acceleration, etc. .................................................. 56
10.3. Application of Liquidation Proceeds ................................. 56
SECTION 11. THE ADMINISTRATIVE AGENT ..................................................... 57
11.1. Appointment ......................................................... 57
11.2. Delegation of Duties ................................................ 57
</TABLE>
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11.3. Exculpatory Provisions .............................................. 57
11.4. Reliance by Administrative Agent .................................... 57
11.5. Notice of Default ................................................... 58
11.6. Non-Reliance ........................................................ 58
11.7. Indemnification ..................................................... 58
11.8. The Administrative Agent in Individual Capacity ..................... 59
11.9. Successor Administrative Agent ...................................... 59
11.10. Other Agents ........................................................ 59
SECTION 12. MISCELLANEOUS ................................................................ 59
12.1. Payment of Expenses etc. ............................................ 59
12.2. Right of Setoff ..................................................... 60
12.3. Notices ............................................................. 60
12.4. Benefit of Agreement ................................................ 61
12.5. No Waiver: Remedies Cumulative ...................................... 64
12.6. Payments Pro Rata; Sharing of Setoffs, etc .......................... 64
12.7. Calculations: Computations .......................................... 65
12.8. Governing Law; Submission to Jurisdiction; Venue; Waiver of
Jury Trial ....................................................... 65
12.9. Counterparts ........................................................ 66
12.10. Effectiveness; Integration .......................................... 66
12.11. Headings Descriptive ................................................ 66
12.12. Amendment or Waiver ................................................. 66
12.13. Survival of Indemnities ............................................. 67
12.14. Domicile of Loans ................................................... 67
12.15. Confidentiality ..................................................... 67
12.16. Lender Register ..................................................... 68
12.17. Limitations on Liability of the Letter of Credit Issuers ............ 68
12.18. General Limitation of Liability ..................................... 68
12.19. No Duty ............................................................. 68
12.20. Lenders and Agent Not Fiduciary to Borrower, etc. ................... 69
12.21. Survival of Representations and Warranties .......................... 69
12.22. Severability ........................................................ 69
12.23. Independence of Covenants ........................................... 69
12.24. No Reliance on Margin Stock ......................................... 69
12.25. Interest Rate Limitation ............................................ 69
</TABLE>
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- ---------------
ANNEX I - INFORMATION AS TO LENDERS
ANNEX II - INFORMATION AS TO SUBSIDIARIES
ANNEX III - DESCRIPTION OF EXISTING INDEBTEDNESS
ANNEX IV - DESCRIPTION OF LETTERS OF CREDIT DEEMED
ISSUED UNDER THE CREDIT AGREEMENT
EXHIBIT A-1 - FORM OF GENERAL REVOLVING NOTE
EXHIBIT A-2 - FORM OF SWING LINE REVOLVING NOTE
EXHIBIT A-3 - FORM OF COMPETITIVE BID NOTE
EXHIBIT B-1 - FORM OF NOTICE OF REVOLVING BORROWING
EXHIBIT B-2 - FORM OF NOTICE OF COMPETITIVE BID BORROWING
EXHIBIT B-3 - FORM OF NOTICE OF CONVERSION
EXHIBIT B-4 - FORM OF LETTER OF CREDIT REQUEST
EXHIBIT C - FORM OF SUBSIDIARY GUARANTY
EXHIBIT D - FORM OF OPINION OF SPECIAL COUNSEL TO THE BORROWER
EXHIBIT E - FORM OF ASSIGNMENT AGREEMENT
EXHIBIT F - FORM OF DESIGNATION AGREEMENT
EXHIBIT G - FORM OF SECTION 5.4(b)(ii) CERTIFICATE
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of May 9, 2000, among the following:
(i) FERRO CORPORATION, an Ohio corporation (herein, together
with its successors and assigns, the "Borrower");
(ii) the lending institutions signatory hereto (each a
"Lender" and collectively, the "Lenders");
(iii) KEYBANK NATIONAL ASSOCIATION, as a Lender and as
syndication agent (the "Syndication Agent");
(iv) BANK ONE, MICHIGAN, as a Lender and as documentation
agent (the "Documentation Agent"); and
(v) NATIONAL CITY BANK, a national banking association, as a
Lender, the Swing Line Lender, the Letter of Credit Issuer, the Lead
Arranger, and as the administrative agent (the "Administrative Agent"):
PRELIMINARY STATEMENTS:
(1) Unless otherwise defined herein, all capitalized terms used herein
and defined in section 1 are used herein as so defined.
(2) The Borrower has applied to the Lenders for credit facilities in
order to provide working capital and funds for other lawful purposes.
(3) Subject to and upon the terms and conditions set forth herein, the
Lenders are willing to make available to the Borrower the credit facilities
provided for herein.
NOW, THEREFORE, it is agreed:
SECTION 1. DEFINITIONS AND TERMS.
1.1. Certain Defined Terms. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires:
"Acquisition" shall mean and include (i) any acquisition on a going
concern basis (whether by purchase, lease or otherwise) of any facility and/or
business operated by any person who is not a Subsidiary of the Borrower, and
(ii) acquisitions of a majority of the outstanding equity or other similar
interests in any such person (whether by merger, stock purchase or otherwise).
"Adjusted LIBO Rate" shall mean with respect to each Interest Period
for a LIBOR Loan, (i) the rate per annum appearing on page 3750 of the Telerate
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to U.S. dollar deposits in the
London interbank market), at approximately 11:00 a.m. (London time) two Business
Days prior to the commencement of such Interest Period, as the rate for U.S.
dollar deposits with a maturity comparable to such Interest Period, divided (and
rounded to the nearest ten thousandth of 1%) by (ii) a percentage equal to 100%
minus the then stated maximum rate of all reserve requirements (including,
without limitation, any marginal, emergency, supplemental, special or other
reserves and without benefit of credits for proration, exceptions or offsets
which may be available from time to time) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency liabilities as defined in
Regulation D (or any successor category
<PAGE> 7
of liabilities under Regulation D); provided, however, that in the event that
the rate referred to in clause (i) above is not available at any such time for
any reason, then the rate referred to in clause (i) shall instead be the average
(rounded to the nearest ten thousandth of 1%) of the rates at which U.S. dollar
deposits of $5,000,000 are offered to the Reference Banks in the London
interbank market at approximately 11:00 a.m. (London time), two Business Days
prior to the commencement of such Interest Period, for contracts which would be
entered into at the commencement of such Interest Period.
"Administrative Agent" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to section 11.9.
"Administrative Questionnaire" shall mean an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affiliate" shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 20% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
by reason of such status, be considered an Affiliate of such person; and (y)
neither the Administrative Agent nor any Lender shall in any event be considered
an Affiliate of the Borrower or any other Credit Party or any of their
respective Subsidiaries.
"Agreement" shall have the meaning provided in the first paragraph
hereof.
"Alternative Currency" shall mean and include any lawful currency other
than Dollars which is readily and freely transferable and convertible into
Dollars and is acceptable to any applicable Letter of Credit Issuer.
"Applicable LIBOR Margin" shall have the meaning provided in section
2.7(h).
"Applicable Facility Fee Rate" shall have the meaning provided in
section 4.1(a).
"Applicable Lending Office" shall mean, (i) with respect to each Lender
and its General Revolving Loans which are Prime Rate Loans, such Lender's
Domestic Lending Office, (ii) with respect to each Lender and its General
Revolving Loans which are LIBOR Loans, such Lender's Eurodollar Lending Office,
(iii) with respect to each Lender and its Competitive Bid Loans, such Lender's
Domestic Lending Office, (iv) with respect to the Swing Line Lender and its
Swing Line Revolving Loans, its Domestic Lending Office, and (v) with respect to
any Designated Bidder and its Competitive Bid Loans, such Designated Bidder's
Applicable Lending Office, located in the United States, as specified in the
Designation Agreement of such Designated Bidder.
"Asset Sale" shall mean the sale, transfer or other disposition
(including by means of sale and leaseback transaction, and by means of mergers,
consolidations, and liquidations of a corporation, partnership or limited
liability company of the interests therein of the Borrower or any Subsidiary) by
the Borrower or any Subsidiary to any person other than the Borrower or any
Subsidiary of any of their respective assets (other than sales, transfers or
other dispositions of inventory, or obsolete or excess furniture, fixtures,
equipment or other property, tangible or intangible, in the ordinary course of
business).
"Assignment Agreement" shall mean an Assignment Agreement substantially
in the form of Exhibit E hereto.
"Attributable Debt" shall mean, as to any particular lease under which
any person is at the time liable, at any date as of which the amount thereof is
to be determined, the total net amount of rent required to be paid by such
person under such lease during the remaining term thereof (after giving effect
to any extensions at the option of the lessor), discounted from the respective
due dates thereof to such date at the rate of 1% per annum over the interest
rate which would then be applicable to a new Borrowing of Eurodollar Loans under
the General Revolving Facility with an Interest Period of six months, compounded
semi-annually. The net amount of rent required to be paid under any such
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<PAGE> 8
lease for any such period, after excluding amounts required to be paid on
account of maintenance and repairs, insurance, taxes, assessments, water rates
and similar charges. In the case of any lease which is terminable by the lessee
upon the payment of a penalty, such net amount shall also include the amount of
such penalty, but no rent shall be considered as required to be paid under such
lease subsequent to the first date upon which it may be so terminated.
"Authorized Officer" shall mean any officer or employee of the Borrower
designated as such in writing to the Administrative Agent by the Borrower.
"Bankruptcy Code" shall have the meaning provided in section 10.1(h).
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrowing" shall mean a General Revolving Borrowing, a Swing Line
Revolving Borrowing or a Competitive Bid Borrowing, as applicable.
"Business Day" shall mean (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which shall be
in the city in which the Payment Office is located a legal holiday or a day on
which banking institutions are authorized by law or other governmental actions
to close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, LIBOR Loans, any day which is a
Business Day described in clause (i) and which is also a day for trading by and
between banks in U.S. dollar deposits in the interbank Eurodollar market.
"Capital Lease" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that person.
"Capitalized Lease Obligations" shall mean all obligations under
Capital Leases of the Borrower or any of its Subsidiaries in each case taken at
the amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. Section 9601 et seq.
"Change of Control" shall mean and include any of the following:
(i) during any period of two consecutive calendar
years, individuals who at the beginning of such period constituted the
Borrower's Board of Directors (together with any new directors (x)
whose election by the Borrower's Board of Directors was, or (y) whose
nomination for election by the Borrower's shareholders was (prior to
the date of the proxy or consent solicitation relating to such
nomination), approved by a vote of at least two-thirds of the directors
then still in office who either were directors at the beginning of such
period or whose election or nomination for election was previously so
approved), shall cease for any reason to constitute a majority of the
directors then in office;
(ii) any person or group (as such term is defined in
section 13(d)(3) of the 1934 Act), other than the Borrower, any trustee
or other fiduciary holding securities under an employee benefit plan of
the Borrower and the Current Holder Group, shall acquire, directly or
indirectly, beneficial ownership (within the meaning of Rule 13d-3 and
13d-5 of the 1934 Act) of more than 50%, on a fully diluted basis, of
the economic or voting interest in the Borrower's capital stock;
(iii) the shareholders of the Borrower approve a
merger or consolidation of the Borrower with any other person, other
than a merger or consolidation which would result in the voting
securities of the Borrower outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted or exchanged for voting securities of the surviving or
resulting entity) more than 50% of
3
<PAGE> 9
the combined voting power of the voting securities of the Borrower or
such surviving or resulting entity outstanding after such merger or
consolidation; and/or
(iv) the shareholders of the Borrower approve a plan
of complete liquidation of the Borrower or an agreement or agreements
for the sale or disposition by the Borrower of all or substantially all
of the Borrower's assets.
"Closing Date" shall mean the date, on or after the Effective Date,
upon which the conditions specified in section 6.1 are satisfied.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the Effective
Date and any subsequent provisions of the Code, amendatory thereof, supplemental
thereto or substituted therefor.
"Commitment" shall mean, with respect to each Lender, its General
Revolving Commitment, and/or its Swing Line Revolving Commitment, as applicable.
"Competitive Bid Borrowing" shall mean a borrowing consisting of one or
more Competitive Bid Loans made pursuant to section 2.3.
"Competitive Bid Loan" shall mean a loan denominated in U.S. Dollars
made pursuant to section 2.3.
"Competitive Bid Note" shall have the meaning provided in section
2.4(a).
"Competitive Bid Reduction" shall have the meaning provided in section
2.1.
"Confidential Information Memorandum" shall have the meaning provided
in section 7.8(c).
"Consolidated Amortization Expense" shall mean, for any period, all
amortization expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"Consolidated Depreciation Expense" shall mean, for any period, all
depreciation expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income for such period; plus (A) the sum of the amounts for such period included
in determining such Consolidated Net Income of (i) Consolidated Interest
Expense, (ii) Consolidated Income Tax Expense, (iii) Consolidated Depreciation
Expense, (iv) Consolidated Amortization Expense, and (v) non-cash losses and
charges which are properly classified as extraordinary or nonrecurring; less (B)
gains on sales of assets (excluding sales in the ordinary course of business)
and other gains which are properly classified as extraordinary or nonrecurring;
all as determined for the Borrower and its Subsidiaries on a consolidated basis
in accordance with GAAP.
Notwithstanding the foregoing, in determining Consolidated Net Income
for purposes of this definition there shall be excluded therefrom (i) the
income, (or loss) of any entity (other than Subsidiaries of the Borrower) in
which the Borrower or any of its Subsidiaries has a joint interest, except to
the extent of the amount of dividends or other distributions actually paid to
the Borrower or any of its Subsidiaries during such period, and (ii) the income
of any Subsidiary of the Borrower to the extent that the declaration or payment
of dividends or similar distributions by that Subsidiary of that income is not
at the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary.
In addition and notwithstanding the foregoing, the Borrower's
Consolidated EBITDA for any Testing Period shall (x) include the appropriate
financial items for any person or business unit which has been acquired by the
4
<PAGE> 10
Borrower for any portion of such Testing Period prior to the date of
acquisition, and (y) exclude the appropriate financial items for any person or
business unit which has been disposed of by the Borrower, for the portion of
such Testing Period prior to the date of disposition.
"Consolidated Income Tax Expense" shall mean, for any period, all
provisions for taxes based on the net income of the Borrower or any of its
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" shall mean, for any period, total
interest expense (including that which is capitalized, that which is
attributable to Capital Leases or Synthetic Leases and the pre-tax equivalent of
dividends payable on Redeemable Preferred Stock) of the Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries including, without limitation,
all commissions, discounts and other fees and charges owed with respect to
letters of credit and net costs under Hedge Agreements, but excluding, however,
any amortization or write-off of deferred financing costs and any charges for
prepayment penalties on prepayment of Indebtedness.
"Consolidated Net Income" shall mean for any period, the net income (or
loss), without deduction for minority interests, of the Borrower and its
Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP.
"Consolidated Net Tangible Assets" shall mean the aggregate amount of
assets (less applicable reserves and other properly deductible items), after
deducting therefrom (i) all current liabilities (excluding any thereof
constituting Indebtedness by reason of being renewable or extendible for a
matuturity longer than one year), and (ii) all goodwill and intangibles,
including trade names trademarks, patents and unamortized debt discount and
expense, all as determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Net Worth" shall mean at any time for the determination
thereof all amounts which, in conformity with GAAP, would be included under the
caption "total stockholders' equity" (or any like caption) on a consolidated
balance sheet of the Borrower as at such date, provided that in no event shall
Consolidated Net Worth include any amounts in respect of Redeemable Stock.
"Consolidated Total Debt" shall mean the sum (without duplication) of
all Indebtedness of the Borrower and of each of its Subsidiaries, all as
determined on a consolidated basis.
"Continue", "Continuation" and "Continued" each refers to a
continuation of General Revolving Loans consisting of LIBOR Loans for an
additional Interest Period as provided in section 2.8.
"Convert", "Conversion" and "Converted" each refers to a conversion of
General Revolving Loans of one Type into General Revolving Loans of another
Type, pursuant to section 2.5, 2.8(b), 2.9 or 5.2.
"Credit Documents" shall mean this Agreement, the Notes, any Letter of
Credit Document and (if executed and delivered) the Subsidiary Guaranty.
"Credit Event" shall mean the making of any Loans and/or the issuance
of any Letter of Credit.
"Credit Party" shall mean the Borrower and each of its Subsidiaries
which is a party to any Credit Document.
"Current Holder Group" shall mean (i) those persons who are officers
and directors of the Borrower at the Effective Date, (ii) the spouses, heirs,
legatees, descendants and blood relatives to the third degree of consanguinity
of any such person, (iii) the executors and administrators of the estate of any
such person, and any court appointed guardian of any such person, and/or (iv)
any trust for the benefit of any such person referred to in the foregoing
clauses (i) and (ii) or any other persons, so long as one or more members of the
Current Holder Group has the exclusive right to control the voting and
disposition of securities held by such trust.
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<PAGE> 11
"Debt" shall have the meaning provided in section 9.3.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with, respect to which a
Lender Default is in effect.
"Designated Bidder" shall mean (i) an Eligible Transferee or (ii) a
special purpose corporation which is engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of its business and that
issues (or the parent of which issues) commercial paper rated at least Prime-1
(or the then equivalent grade) by Moody's or A-1 (or the then equivalent grade)
by S&P, that, in either case, (A) is organized under the laws of the United
States or any State thereof, (B) shall have become a party hereto pursuant to
section 12.4(d), and (C) is not otherwise a Lender.
"Designation Agreement" shall mean a designation agreement entered into
by a Lender (other than a Designated Bidder) and a Designated Bidder, and
accepted by the Administrative Agent, in substantially the form of Exhibit F
hereto.
"Dollars", "U.S. dollars" and the sign "$" each means lawful money of
the United States.
"Domestic Lending Office" shall mean, with respect to any Lender, the
office of such Lender specified as its Domestic Lending Office in its
Administrative Questionnaire or in the Assignment Agreement pursuant to which it
became a Lender, or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Administrative Agent.
"Domestic Subsidiary" shall mean any Subsidiary organized under the
laws of the United States of America, any State thereof, the District of
Columbia, or any United States possession, the chief executive office and
principal place of business of which is located in, and which conducts the
majority of its business within, the United States of America and its
territories and possessions.
"Effective Date" shall have the meaning provided in section 12.10.
"Eligible Transferee" shall mean and include a commercial bank,
financial institution or other "accredited investor" (as defined in SEC
Regulation D), in each case which
(i) is not disapproved in writing by the Borrower in a notice
given to a requesting Lender and the Administrative Agent, specifying
the reasons for such disapproval, within five Business Days following
the giving of notice to the Borrower of the identity of any proposed
transferee (any such disapproval by the Borrower must be reasonable),
provided that the Borrower shall not be entitled to exercise the
foregoing right of disapproval if and so long as any Event of Default
shall have occurred and be continuing; and
(ii) is not a direct competitor of the Borrower or engaged in
the same or similar business as the Borrower and its Subsidiaries
considered as an entirety or is not an Affiliate of any such
competitors of the Borrower and its Subsidiaries.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of non-compliance or violation, investigations or proceedings relating
in any way to any Environmental Law or any permit issued under any such law
(hereafter "Claims"), including, without limitation, (i) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (ii) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the storage, treatment or Release (as defined
in CERCLA) of any Hazardous Materials or arising from alleged injury or threat
of injury to health, safety or the environment.
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"Environmental Law" shall mean any applicable Federal, state, foreign
or local statute, law, rule, regulation, ordinance, code, binding and
enforceable guideline, binding and enforceable written policy and rule of common
law now or hereafter in effect and in each case as amended, and any binding and
enforceable judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment issued to or
rendered against the Borrower or any of its Subsidiaries relating to the
environment, employee health and safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. Section 2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.;
the Safe Drinking Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution
Act of 1990, 33 U.S.C. Section 2701 et seq.; the Emergency Planning and the
Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq., the
Hazardous Material Transportation Act, 49 U.S.C. Section 1801 et seq. and the
Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq. (to the extent
it regulates occupational exposure to Hazardous Materials); and any state and
local or foreign counterparts or equivalents, in each case as amended from time
to time.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the
Effective Date and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in section 3(9) of
ERISA) which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of section 414(b), (c),
(m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary of
the Borrower being or having been a general partner of such person.
"Eurodollar Lending Office" shall mean, with respect to any Lender, the
office of such Lender specified as its Eurodollar Lending Office in its
Administrative Questionnaire or in the Assignment Agreement pursuant to which it
became a Lender, or such other office or offices for LIBOR Loans of such Lender
as such Lender may from time to time specify to the Borrower and the
Administrative Agent.
"Event of Default" shall have the meaning provided in section 10.1.
"Existing Indebtedness" shall have the meaning provided in section
7.18.
"Existing Indebtedness Agreements" shall have the meaning provided in
section 7.18.
"Existing Letter of Credit" shall have the meaning provided in section
3.1(d).
"Facility Fee" shall have the meaning provided in section 4.1(a).
"Facing Fee" shall have the meaning provided in section 4.1(c).
"Federal Funds Effective Rate" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to, or referred to in,
section 4.1.
"Foreign Subsidiary" shall mean any Subsidiary (i) which is not
incorporated in the United States and substantially all of whose assets and
properties are located, or substantially all of whose business is carried on,
outside the United States, or (ii) substantially all of whose assets consist of
Subsidiaries that are Foreign Subsidiaries as defined in clause (i) of this
definition.
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<PAGE> 13
"Funded Debt" shall mean all indebtedness for money borrowed having a
maturity of more than 12 months from the date as of which the amount thereof is
to be determined or having a maturity of less than 12 months but by its terms
being renewable or extendible beyond 12 months from such date at the option of
the borrower or issuer.
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; it being understood and
agreed that determinations in accordance with GAAP for purposes of section 9,
including defined terms as used therein, are subject (to the extent provided
therein) to section 1.3 and 12.7(a).
"General Revolving Borrowing" shall mean the incurrence of General
Revolving Loans consisting of one Type of Loan, by the Borrower from all of the
Lenders having Commitments in respect thereof on a pro rata basis on a given
date (or resulting from Conversions or Continuations on a given date), having in
the case of LIBOR Loans the same Interest Period.
"General Revolving Commitment" shall mean, with respect to each Lender,
the amount set forth opposite such Lender's name in Annex I as its "General
Revolving Commitment" as the same may be reduced from time to time pursuant to
section 4.2, 4.3 and/or 10.2 or adjusted from time to time as a result of
assignments to or from such Lender pursuant to section 12.4.
"General Revolving Facility" shall mean the credit facility evidenced
by the Total General Revolving Commitment.
"General Revolving Facility Percentage" shall mean at any time for any
Lender with a General Revolving Commitment, the percentage obtained by dividing
such Lender's General Revolving Commitment by the Total General Revolving
Commitment, provided, that if the Total General Revolving Commitment has been
terminated, the General Revolving Facility Percentage for each Lender with a
General Revolving Commitment shall be determined by dividing such Lender's
General Revolving Commitment immediately prior to such termination by the Total
General Revolving Commitment immediately prior to such termination.
"General Revolving Loan" shall have the meaning provided in section
2.1(a).
"General Revolving Note" shall have the meaning provided in section
2.4(a).
"Guaranty Obligations" shall mean as to any person (without
duplication) any obligation of such person guaranteeing any Indebtedness
("primary Indebtedness") of any other person (the "primary obligor") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such person, whether or not contingent, (a) to purchase any such
primary Indebtedness or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary Indebtedness or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof, provided, however, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary Indebtedness in respect of which such Guaranty Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such person is required to perform
thereunder) as determined by such person in good faith.
"Hedge Agreement" shall mean (i) any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement designed to protect against fluctuations in interest
rates, (ii) any currency swap agreement, forward currency purchase agreement or
similar agreement or arrangement designed to protect against fluctuations in
currency exchange rates, and (iii) any forward commodity purchase agreement or
similar agreement or arrangement designed to protect against fluctuations in raw
material or other commodity prices.
"Hazardous Materials" shall mean (i) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other
8
<PAGE> 14
equipment that contain dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; and (ii) any chemicals, materials or substances
defined as or included in the definition of "hazardous substances", "hazardous
wastes", "hazardous materials", "restricted hazardous materials", "extremely
hazardous wastes", "restrictive hazardous wastes", "toxic substances", "toxic
pollutants", "contaminants" or "pollutants", or words of similar meaning and
regulatory effect, under any applicable Environmental Law.
"Indebtedness" of any person shall mean without duplication:
(i) all indebtedness of such person for borrowed money;
(ii) all bonds, notes, debentures and similar debt securities
of such person;
(iii) the deferred purchase price of capital assets or
services which in accordance with GAAP would be shown on the liability
side of the balance sheet of such person;
(iv) the face amount of all letters of credit issued for the
account of such person and, without duplication, all drafts drawn
thereunder; (v) all obligations, contingent or otherwise, of such
person in respect of bankers' acceptances;
(vi) all Indebtedness of a second person secured by any Lien
on any property owned by such first person, whether or not such
indebtedness has been assumed;
(vii) all Capitalized Lease Obligations of such person;
(viii) the present value, determined on the basis of the
implicit interest rate, of all basic rental obligations under all
Synthetic Leases of such person;
(ix) all obligations of such person to pay a specified
purchase price for goods or services whether or not delivered or
accepted, i.e., take-or-pay and similar obligations;
(x) all net obligations of such person under Hedge Agreements;
(xi) the full outstanding balance of trade receivables, notes
or other instruments sold with full recourse (and the portion thereof
subject to potential recourse, if sold with limited recourse), other
than in any such case any thereof sold solely for purposes of
collection of delinquent accounts;
(xii) the stated value, or liquidation value if higher, of all
Redeemable Stock of such person; and
(xiii) all Guaranty Obligations of such person;
provided that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same), shall constitute Indebtedness; and (y) the
Indebtedness of any person shall in any event include (without duplication) the
Indebtedness of any other entity (including any general partnership in which
such person is a general partner) to the extent such person is liable thereon 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 expressly
that such person is not liable thereon.
"Index Debt" shall mean senior, unsecured, long-term debentures or
other debt securities of the Borrower that are not guaranteed by any other
person or subject to any other credit support or enhancement.
"Interest Period" with respect to any LIBOR Loan shall mean the
interest period applicable thereto, as determined pursuant to section 2.8.
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<PAGE> 15
"Investment Grade" shall mean at any date of determination that the
Index Debt of the Borrower has (i) a rating from Moody's not lower than Baa3 (or
the equivalent thereof used by Moody's) and (ii) a rating from S&P not lower
than BBB- (or the equivalent thereof used by S&P).
"Lead Arranger" shall mean National City Bank, and its successors and
assigns.
"Leaseholds" of any person means all the right, title and interest of
such person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
"Lender" shall have the meaning provided in the first paragraph of this
Agreement and, except when used with reference to a Revolving Loan, a Facility,
a Commitment or a related term or defined term, shall also refer to each
Designated Bidder.
"Lender Default" shall mean (i) the refusal (which has not been
retracted) of a Lender in violation of the requirements of this Agreement to
make available its portion of any incurrence of Loans, to fund its portion of
any Swing Line Participation Amount under section 2.6(b), or to fund its portion
of any unreimbursed payment under section 3.4(c); or (ii) a Lender having
notified the Administrative Agent and/or the Borrower that it does not intend to
comply with the obligations under section 2.1, section 2.6(a) or (b) and/or
section 3.4(c), in the case of either (i) or (ii) as a result of the appointment
of a receiver or conservator with respect to such Lender at the direction or
request of any regulatory agency or authority.
"Lender Register" shall have the meaning provided in section 12.16.
"Letter of Credit" shall have the meaning provided in section 3.1(a).
"Letter of Credit Documents" shall have the meaning specified in
section 3.2(a).
"Letter of Credit Fee" shall have the meaning provided in section
4.1(b).
"Letter of Credit Issuer" shall mean (i) in respect of each Existing
Letter of Credit, the Lender that has issued same as of the Effective Date; and
(ii) in respect of any other Letter of Credit, (1) NCB, and/or (2) such other
Lender that is requested, and agrees, to so act by the Borrower, and is approved
by the Administrative Agent.
"Letter of Credit Outstandings" shall mean, at any time, the sum,
without duplication, of (i) the aggregate Stated Amount of all outstanding
Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in section
3.2(a).
"LIBOR Loans" shall mean each Loan bearing interest at the rates
provided in section 2.7(b).
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement or any lease
in the nature thereof).
"Loan" shall mean a General Revolving Loan, a Swing Line Revolving Loan
or a Competitive Bid Loan, as applicable.
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Effect" shall mean (i )a material adverse effect on
the business, operations, property, assets, liabilities or condition (financial
or otherwise) of, when used with reference to the Borrower and/or any of its
Subsidiaries, the Borrower and its Subsidiaries, taken as a whole, or when used
with reference to any other person, such person and its Subsidiaries, taken as a
whole, as the case may be; (ii) any material adverse effect on the ability of
the Borrower to perform its obligations under the Credit Documents to which it
is a party; or (iii) any material
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adverse effect on the validity or effectiveness as against, or the
enforceability against, any Credit Party of any of the Credit Documents to which
it is a party.
"Material Subsidiary" shall mean,, at any time, with reference to any
person, any Subsidiary of such person (i) that has assets at such time
comprising 10% or more of the consolidated assets of such person and its
Subsidiaries, or (ii) whose operations in the current fiscal year are expected
to, or whose operations in the most recent fiscal year did (or would have if
such person had been a Subsidiary for such entire fiscal year), represent 10% or
more of the consolidated earnings before interest, taxes, depreciation and
amortization of such person and its Subsidiaries for such fiscal year.
"Maturity Date" shall mean April 30, 2005 or such later date to which
the Total Commitment has been extended as provided in section 4.4, subject in
any case to earlier termination as provided in this Agreement.
"Minimum Borrowing Amount" shall mean (i) for Swing Line Revolving
Loans, $500,000, with minimum increments thereafter of $100,000; and (ii) for
General Revolving Loans which are (A) Prime Rate Loans, $1,000,000, with minimum
increments thereafter of $100,000, or (B) LIBOR Loans, $5,000,000, with minimum
increments thereafter of $1,000,000.
"Money Market Rate Loan" shall mean a Swing Line Revolving Loan bearing
interest at a Quoted Rate.
"Moody's" shall mean Moody's Investors Service, Inc. and its
successors.
"Mortgage" shall mean and include any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.
"Multiemployer Plan" shall mean a multiemployer plan, as defined in
section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions or has within any of the
preceding three plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" shall mean an employee benefit plan, other
than a Multiemployer Plan, to which the Borrower or any ERISA Affiliate, and one
or more employers other than the Borrower or an ERISA Affiliate, is making or
accruing an obligation to make contributions or, in the event that any such plan
has been terminated, to which the Borrower or an ERISA Affiliate made or accrued
an obligation to make contributions during any of the five plan years preceding
the date of termination of such plan.
"NCB" shall mean National City Bank, and its successors and assigns.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"Non-Defaulting Lender" shall mean each Lender other than a Defaulting
Lender.
"Note" shall mean a General Revolving Note, a Swing Line Revolving Note
or a Competitive Bid Note, as applicable.
"Notice of Borrowing" shall mean a Notice of Revolving Borrowing or a
Notice of Competitive Bid Borrowing, as applicable.
"Notice of Competitive Bid Borrowing" shall have the meaning provided
in section 2.3(a).
"Notice of Continuation" shall have the meaning provided in section
2.8(a).
"Notice of Conversion" shall have the meaning provided in section 2.5.
"Notice Office" shall mean the office of the Administrative Agent at
1900 East Ninth Street, Cleveland, Ohio 44114, Attention: Agency Services
(telephone: (216) 575-2560; facsimile: (216) 222-0012), or such other office,
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<PAGE> 17
located in a city in the United States Eastern Time Zone, as the Administrative
Agent may designate to the Borrower from time to time.
"Notice of Revolving Borrowing" shall have the meaning provided in
section 2.2(a).
"Obligations" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing by the
Borrower to the Administrative Agent or any Lender or Designated Bidder pursuant
to the terms of this Agreement or any other Credit Document.
"Operating Lease" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is not accounted for as a Capital Lease on the balance
sheet of that person.
"pari passu" shall mean, when used with reference to the ranking of any
Debt of any person in relation to any other Debt of such person, that each such
Debt (a) either (i) is not subordinate in right of payment to any other Debt of
such person or (ii) is subordinate in right of payment to the same Debt of such
person as is the other and is so subordinate to the same extent and (b) is not
subordinate in right of payment to the other or to any Debt of such person as to
which the other is not so subordinate.
"Participant" shall have the meaning provided in section 3.4(a).
"Payment Office" shall mean the office of the Administrative Agent at
1900 East Ninth Street, Cleveland, Ohio 44114, Attention: Funding Desk
Administrator (telephone: (216) 575-2314 or (216) 575-560; facsimile: (216) 222-
0012), or such other office, located in a city in the United States Eastern Time
Zone, as the Administrative Agent may designate to the Borrower from time to
time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Liens" shall mean Liens which are not prohibited by section
9.3.
"Permitted Receivables Programs" shall have the meaning provided in
section 9.2(c).
"person" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan as defined
in section 4001 of ERISA, which is maintained or contributed to by (or to which
there is an obligation to contribute by) the Borrower or a Subsidiary of the
Borrower or an ERISA Affiliate, and each such plan for the five year period
immediately following the latest date on which the Borrower, or a Subsidiary of
the Borrower or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.
"Prime Rate" shall mean, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time which rate per annum shall at
all times be equal to the greater of (i) the rate of interest established by NCB
in Cleveland, Ohio, from time to time, as its prime rate, whether or not
publicly announced, which interest rate may or may not be the lowest rate
charged by it for commercial loans or other extensions of credit; and (ii) the
Federal Funds Effective Rate in effect from time to time plus 1/2 of 1% per
annum.
"Prime Rate Loan" shall mean each Loan bearing interest at the rate
provided in section 2.7(a).
"Principal Domestic Manufacturing Property" shall mean any building,
structure or other facility, together with the land upon which it is erected and
fixtures comprising a part thereof, used primarily for manufacturing, processing
or warehousing of the Borrower's products and located in the United States of
America, owned or leased by the Borrower or any Subsidiary, the gross book value
(without deduction of any depreciation reserves) of which
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on the date as of which the determination is being made exceeds 1% of
Consolidated Net Tangible Assets, other than any such building, structure or
other facility or portion thereof or any such land or fixture (i) which is
financed by obligations issued by a State, a Territory, or a possession of the
United States, or any political subdivision of any of the foregoing, or the
District of Columbia, the interest on which is excludible from gross income of
the holders thereof pursuant to the provisions of section 745 of Title 48 of the
United States Code (or any successor to such provisions) as in effect at the
time of the issuance of such obligations, or (ii) which, in the opinion of the
Board of Directors of the Borrower, is not of material importance to the total
business conducted by the Borrower and its Subsidiaries as an entirety.
"Prohibited Transaction" shall mean a transaction with respect to a
Plan that is prohibited under section 4975 of the Code or section 406 of ERISA
and not exempt under section 4975 of the Code or section 408 of ERISA.
"Quoted Rate" shall have the meaning provided in section 2.2(b).
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. section 6901 et seq.
"Real Property" of any person shall mean all of the right, title and
interest of such person in and to land, improvements and fixtures, including
Leaseholds.
"Redeemable Stock" shall mean with respect to any person any capital
stock or similar equity interests of such person that (i) is by its terms
subject to mandatory redemption, in whole or in part, pursuant to a sinking
fund, scheduled redemption or similar provisions, at any time prior to the
Maturity Date; or (ii) otherwise is required to be repurchased or retired on a
scheduled date or dates, upon the occurrence of any event or circumstance, at
the option of the holder or holders thereof, or otherwise, at any time prior to
the Maturity Date, other than any such repurchase or retirement occasioned by a
"change of control" or similar event.
"Reference Banks" shall mean (i) NCB and (ii) any other Lender or
Lenders selected as a Reference Bank by the Administrative Agent and the
Required Lenders, provided, that if any of such Reference Banks is no longer a
Lender, such other Lender or Lenders as may be selected by the Administrative
Agent acting on instructions from the Required Lenders.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.
"Regulation U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing margin requirements.
"Reportable Event" shall mean an event described in section 4043 of
ERISA or the regulations thereunder with respect to a Plan, other than those
events as to which the notice requirement is waived under subsections .22, .23,
.25, .27, .28, .29, .30, .31, .32, .34, .35, .62, .63, .64, .65 or .67 of PBGC
Regulation section 4043.
"Required Lenders" shall mean Non-Defaulting Lenders whose outstanding
General Revolving Loans and Unutilized General Revolving Commitments constitute
at least 66+2/3% of the sum of the total outstanding General Revolving Loans and
Unutilized General Revolving Commitments of Non-Defaulting Lenders (provided
that, for purposes hereof, neither the Borrower, nor any of its Affiliates,
shall be included in (i) the Lenders holding such amount of such General
Revolving Loans or having such amount of such Unutilized General Revolving
Commitments, or (ii) determining the aggregate unpaid principal amount of such
General Revolving Loans or such Unutilized General Revolving Commitments); and
provided, further, that for purpose of declaring the Loans due and payable
pursuant to section 10.2, and for all purposes after the Loans become due and
payable pursuant to section 10.2 or after the Total Commitment expires or is
terminated, the outstanding Competitive Bid Loans of the Non-Defaulting Lenders
shall be included together with the outstanding General Revolving Loans in
determining the Required Lenders.
"Revolving Loan" shall mean a General Revolving Loan or a Swing Line
Revolving Loan, as applicable.
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"sale and leaseback transaction" shall have the meaning provided in
section 9.4.
"S&P" shall mean Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., and its successors.
"SEC" shall mean the United States Securities and Exchange Commission.
"SEC Regulation D" shall mean Regulation D as promulgated under the
Securities Act of 1933, as amended, as the same may be in effect from time to
time.
"Section 5.4(b)(ii) Certificate" shall have the meaning provided in
section 5.4(b)(ii).
"Stated Amount" of each Letter of Credit shall mean the maximum
available to be drawn thereunder (regardless of whether any conditions or other
requirements for drawing could then be met).
"Subsidiary" of any person shall mean and include (i) any corporation
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to "Subsidiary" shall mean a
Subsidiary of the Borrower.
"Subsidiary Guaranty" shall have the meaning provided in section
8.11(a).
"Subordinated Indebtedness" shall mean any Indebtedness which has been
subordinated to the Obligations in such manner and to such extent as the
Administrative Agent (acting on instructions from the Required Lenders) may
require.
"Swing Line Lender" shall mean NCB and its successors and assigns
having the Swing Line Revolving Commitment.
"Swing Line Participation Amount" shall have the meaning provided in
section 2.6(b).
"Swing Line Revolving Borrowing" shall mean the incurrence of a Swing
Line Revolving Loan of a single Type from the Swing Line Lender on a given date,
having in the case of a Money Market Loan a single maturity date and Quoted
Rate.
"Swing Line Revolving Commitment" shall mean, with respect to the Swing
Line Revolving Lender, the amount, if any, set forth opposite the Swing Line
Lender's name in Annex I as its "Swing Line Revolving Commitment" as the same
may be reduced from time to time pursuant to sections 4.2, 4.3 and/or 10.2 or
adjusted from time to time as a result of assignments to or from the Swing Line
Lender pursuant to section 12.4.
"Swing Line Revolving Facility" shall mean the credit facility
evidenced by the Swing Line Revolving Commitment.
"Swing Line Revolving Loan" shall have the meaning provided in section
2.1(b).
"Swing Line Revolving Note" shall have the meaning provided in section
2.4(a).
"Synthetic Lease" shall mean any lease (i) which is accounted for by
the lessee as an Operating Lease, and (ii) under which the lessee is intended to
be the "owner" of the leased property for Federal income tax purposes.
"Testing Period" shall mean for any determination a single period
consisting of the four consecutive fiscal quarters of the Borrower then last
ended (whether or not such quarters are all within the same fiscal year), except
that if a particular provision of this Agreement indicates that a Testing Period
shall be of a different specified duration, such
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<PAGE> 20
Testing Period shall consist of the particular fiscal quarter or quarters then
last ended which are so indicated in such provision.
"Total Commitment" shall mean all of the Commitments hereunder.
"Total General Revolving Commitment" shall mean the sum of the General
Revolving Commitments of the Lenders.
"Type" shall mean any type of Loan determined with respect to the
interest option applicable thereto, i.e., (i) a Prime Rate Loan or a LIBOR Loan,
in the case of Borrowings under the General Revolving Facility, (ii) a Prime
rate Loan or a Money Market Rate Loan, in the case of Borrowings under the Swing
Line Revolving Facility, or (iii) a Competitive Bid Loan with interest at a
fixed rate or on some other basis, in the case of Borrowings of Competitive Bid
Loans.
"UCC" shall mean the Uniform Commercial Code as at the time in effect
in any applicable jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if any,
by which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year exceeds the fair market value
of the assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.
"United States" and "U.S." each means United States of America.
"Unpaid Drawing" shall have the meaning provided in section 3.3(a).
"Unutilized General Revolving Commitment" for any Lender at any time
shall mean the excess of (i) such Lender's General Revolving Commitment at such
time over (ii) the sum of (x) the principal amount of General Revolving Loans
made by such Lender and outstanding at such time and (y) such Lender's General
Revolving Facility Percentage of Letter of Credit Outstandings at such time.
"Unutilized Total General Revolving Commitment" shall mean, at any
time, the excess of (i) the Total General Revolving Commitment at such time over
(ii) the sum of (x) the aggregate principal amount of all General Revolving
Loans then outstanding plus (y) the aggregate Letter of Credit Outstandings at
such time.
"Unutilized Swing Line Revolving Commitment" shall mean, at any time,
the excess of (i) the Swing Line Revolving Commitment at such time over (ii) the
aggregate principal amount of all Swing Line Revolving Loans then outstanding.
"Wholly-Owned Subsidiary" shall mean each Subsidiary of the Borrower at
least 95% of whose capital stock, equity interests and partnership interests,
other than director's qualifying shares or similar interests, are owned directly
or indirectly by the Borrower.
"Written", "written" or "in writing" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.
1.2. Computation of Time Periods. In this Agreement in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each means "to
but excluding".
1.3. Accounting Terms. Except as otherwise specifically 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 of section 8 or 9 hereof to eliminate the effect of
any change occurring after the Effective Date in GAAP or in the application
thereof to such provision (or if the Administrative Agent notifies the Borrower
that the Required Lenders request an
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amendment to any such provision hereof for such purposes), 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 with the requirements of this Agreement.
1.4. 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 sections, Annexes
and Exhibits shall be construed to refer to sections of, and Annexes and
Exhibits 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 real
property, tangible and intangible assets and properties, including cash,
securities, accounts and contract rights, and interests in any of the foregoing.
1.5. Currency Equivalents. For purposes of this Agreement, except as
otherwise specified herein, (i) the equivalent in Dollars of any Alternative
Currency shall be determined by using the quoted spot rate at which the
Administrative Agent offers to exchange Dollars for such Alternative Currency at
its Payment Office at 9:00 A.M. (local time at the Payment Office) two Business
Days prior to the date on which such equivalent is to be determined, and (ii)
the equivalent in any Alternative Currency of Dollars shall be determined by
using the quoted spot rate at which the Administrative Agent's Payment Office
offers to exchange such Alternative Currency for Dollars at the Payment Office
at 9:00 A.M. (local time at the Payment Office) two Business Days prior to the
date on which such equivalent is to be determined; provided, that (A) the
equivalent in Dollars of any Unpaid Drawing in respect of any Letter of Credit
denominated in an Alternative Currency shall be determined at the time the
drawing under such Letter of Credit was paid or disbursed by the applicable
Letter of Credit Issuer; (B) for purposes of sections 2.1(a), 3.1(b) and 5.2(a),
the equivalent in Dollars of the Stated Amount of any Letter of Credit
denominated in an Alternative Currency shall be calculated (x) on the date of
the issuance of the respective Letter of Credit, (y) on the first Business Day
of each calendar month thereafter and (z) in any other case where the same is
required or permitted to be calculated, on such other day as the Administrative
Agent may, in its sole discretion, consider appropriate; and (C) for purposes of
sections 4.1(b) and (c), the equivalent in Dollars of the Stated Amount of any
Letter of Credit denominated in an Alternative Currency shall be calculated on
the first day of each calendar month in the quarterly period in which the
respective payment is due pursuant to said sections.
SECTION 2. AMOUNT AND TERMS OF LOANS.
2.1. Commitments for Revolving Loans. Subject to and upon the terms and
conditions herein set forth, each Lender severally agrees to make a Revolving
Loan or Revolving Loans to the Borrower, which Revolving Loans shall be drawn,
to the extent such Lender has a commitment under a Facility, under the
applicable Facility, as set forth below:
(a) General Revolving Facility. Revolving Loans under the
General Revolving Facility (each a "General Revolving Loan" and,
collectively, the "General Revolving Loans"): (i) may be incurred by
the Borrower at any time and from time to time on and after the Closing
Date and prior to the earlier of the Maturity Date or the date the
Total General Revolving Commitment is terminated; (ii) except as
otherwise provided, may, at the option of the Borrower, be incurred and
maintained as, or Converted into, General Revolving Loans which are
Prime Rate Loans or LIBOR Loans, in each case denominated in Dollars,
provided that all General Revolving Loans made as part of the same
Borrowing shall, unless otherwise specifically provided herein, consist
of General Revolving Loans of the same Type; (iii) may be repaid or
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prepaid and reborrowed in accordance with the provisions hereof; (iv)
may only be made if after giving effect thereto the Unutilized Total
General Revolving Commitment exceeds the outstanding Swing Line
Revolving Loans; and (v) shall not exceed for any Lender at any time
outstanding that aggregate principal amount which, when added to the
product at such time of (A) such Lender's General Revolving Facility
Percentage, times (B) the aggregate Letter of Credit Outstandings,
equals the General Revolving Commitment of such Lender at such time.
(b) Swing Line Revolving Facility. Revolving Loans under the
Swing Line Revolving Facility (each a "Swing Line Revolving Loan" and,
collectively, the "Swing Line Revolving Loans"): (i) may be incurred by
the Borrower at any time and from time to time on and after the Closing
Date and prior to the earlier of the Maturity Date or the date the
Swing Line Revolving Commitment is terminated; (ii) shall be made by
only by the Swing Line Lender; (iii) shall be incurred only for working
capital requirements of the Borrower and its Subsidiaries; (iv) may
only be incurred and maintained as Prime Rate Loans or Money Market
Rate Loans, in each case denominated in Dollars; (v) shall in the case
of any Swing Line Revolving Loan have a maturity of not more than 30
days, as specified in the Notice of Revolving Borrowing related
thereto; (vi) may be repaid or prepaid and reborrowed in accordance
with the provisions hereof; (vii) may only be made if after giving
effect thereto the Unutilized Total General Revolving Commitment
exceeds the outstanding Swing Line Revolving Loans; and (viii) shall
not exceed for the Swing Line Lender at any time outstanding its Swing
Line Revolving Commitment at such time.
Except as may otherwise be specifically provided in this Agreement, the Total
General Revolving Commitment shall be deemed used (and correspondently, the
Unutilized Total General Revolving Commitment shall be deemed reduced) from time
to time to the extent of the aggregate amount of the Competitive Bid Loans then
outstanding, and such deemed usage of the Total General Revolving Commitment
(and such deemed reduction in the Unutilized Total General Revolving Commitment)
shall be applied to the Lenders having General Revolving Commitments ratably
according to their respective General Revolving Facility Percentages (such
deemed usage of the Total General Revolving Commitment and such deemed reduction
in the Unutilized Total General Revolving Commitment, each being a "Competitive
Bid Reduction").
2.2. Procedures for Revolving Borrowing and Disbursement of Funds. (a)
Notice of Revolving Borrowing. Whenever the Borrower desires to incur General
Revolving Loans or a Swing Line Revolving Loan, it shall give the Administrative
Agent at its Notice Office,
(A) Borrowings under the General Revolving Facility of LIBOR
Loans: prior to 12:00 noon (local time at its Notice Office), at least
three Business Days' prior written or telephonic notice (in the case of
telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) of each Borrowing of LIBOR Loans to be made
hereunder,
(B) Borrowings under the General Revolving Facility or the
Swing Line Revolving Facility of Prime Rate Loans: prior to 12:00 noon
(local time at its Notice Office) on the proposed date thereof written
or telephonic notice (in the case of telephonic notice, promptly
confirmed in writing if so requested by the Administrative Agent) of
each Borrowing of Prime Rate Loans to be made hereunder, or
(C) Borrowings under the Swing Line Revolving Facility of
Money Market Rate Loans: in the case of any Borrowing under the Swing
Line Revolving Facility of a Money Market Rate Loan to be made
hereunder, if the Administrative Agent shall have furnished the
Borrower with a Quoted Rate therefor, prior to 12:00 noon (local time
at its Notice Office) on the proposed date thereof (which shall be
within such period as the Administrative Agent shall have specified for
such Quoted Rate) written or telephonic notice thereof (in the case of
telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent).
Each such notice (each such notice, a "Notice of Revolving Borrowing") shall (if
requested by the Administrative Agent to be confirmed in writing), be
substantially in the form of Exhibit B-1, and in any event shall be irrevocable
and shall specify: (i) the Facility under which such Borrowing is to be
incurred; (ii) the aggregate principal amount of the Loans to be made pursuant
to such Borrowing; (iii) the date of the Borrowing (which shall be a Business
Day);
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(iv) whether the Borrowing shall consist of Prime Rate Loans, LIBOR Loans or (in
the case of the Swing Line Revolving Facility) a Money Market Rate Loan; (v) if
the requested Borrowing consists of LIBOR Loans, the Interest Period to be
initially applicable thereto; and (vi) if the requested Borrowing is of a Money
Market Rate Loan under the Swing Line Revolving Facility, the maturity date
thereof (which shall not be more than 30 days and shall conform to the quotation
by the Administrative Agent as provided below) and the Quoted Rate applicable
thereto. The Administrative Agent shall promptly give each Lender which has a
Commitment under any applicable Facility written notice (or telephonic notice
promptly confirmed in writing) of each proposed Borrowing under such Facility,
of such Lender's proportionate share thereof and of the other matters covered by
the Notice of Revolving Borrowing relating thereto.
(b) Borrowings of Money Market Rate Loans. Whenever the Borrower
proposes to submit a Notice of Revolving Borrowing with respect to a Swing Line
Revolving Loan which will be a Money Market Rate Loan, it will prior to
submitting such Notice of Revolving Borrowing notify the Administrative Agent of
its intention and request the Administrative Agent to quote a fixed or floating
interest rate (the "QUOTED RATE") to be applicable thereto prior to the proposed
maturity thereof (which shall not exceed 30 days). The Administrative Agent will
immediately so notify the Swing Line Lender, and if the Swing Line Lender is
agreeable to a particular interest rate for the proposed maturity of such Money
Market Rate Loan if such Loan is made on or prior to a specified date, the
Administrative Agent shall quote such interest rate to the Borrower as the
Quoted Rate applicable to such proposed Money Market Rate Loan if made on or
before such specified date for a maturity as so proposed by the Borrower. The
Swing Line Lender contemplates that any Quoted Rate will be a rate of interest
which reflects a margin corresponding to the Applicable LIBOR Margin plus the
Applicable Facility Fee Rate, each as in effect at the time of quotation of any
Quoted Rate, over the then prevailing Federal Funds Effective Rate, commercial
paper, call money, overnight repurchase or other commonly quoted interest rate,
or the Swing Line Lender's average fully absorbed cost of short term funds, in
each case as selected and determined by the Swing Line Lender. Nothing herein
shall be deemed to permit any Lender other than the Swing Line Lender any right
of approval with respect to a Quoted Rate.
(c) Actions by Administrative Agent on Telephone Notice. Without in any
way limiting the obligation of the Borrower to confirm in writing any telephonic
notice permitted to be given hereunder, the Administrative Agent may act prior
to receipt of written confirmation without liability upon the basis of such
telephonic notice believed by the Administrative Agent in good faith to be from
an Authorized Officer of the Borrower entitled to give telephonic notices under
this Agreement on behalf of the Borrower. In each such case, the Administrative
Agent's record of the terms of such telephonic notice shall be conclusive absent
manifest error.
(d) Minimum Borrowing Amounts, etc. The aggregate principal amount of
each Borrowing under a Facility by the Borrower shall not be less than the
Minimum Borrowing Amount. More than one Borrowing may be incurred by the
Borrower on any day under the same and/or any different Facility, provided that
(i) if there are two or more Borrowings on a single day by the Borrower under
the same Facility which consist of LIBOR Loans, each such Borrowing shall have a
different initial Interest Period, (ii) only one Borrowing may be made under the
Swing Line Revolving Facility on any day, and (iii) at no time shall there be
more than 10 Borrowings of LIBOR Loans outstanding under the General Revolving
Facility
(e) Pro Rata Borrowings. All Borrowings under a Facility shall be made
by the Lenders having Commitments under such Facility pro rata on the basis of
their respective Commitments under such Facility. It is understood that no
Lender shall be responsible for any default by any other Lender in its
obligation to make Loans hereunder and that each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to fulfill its Commitment hereunder.
(f) Disbursement of Funds. (i) No later than 2:00 P.M. (local time at
the Payment Office) on the date specified in each Notice of Revolving Borrowing
relating to LIBOR Loans, and no later than 2:00 P.M. (local time at the Payment
Office) on the date specified in each Notice of Revolving Borrowing relating to
Prime Rate Loans, each Lender will make available its pro rata share, if any, of
each Borrowing requested to be made on such date in the manner provided below.
All amounts shall be made available to the Administrative Agent in U.S. dollars
and immediately available funds at the Payment Office and the Administrative
Agent promptly will make available to the Borrower by depositing to its account
at the Payment Office the aggregate of the amounts so made available in the type
of funds received. Unless the Administrative Agent shall have been notified by
any Lender prior to the date of
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Borrowing that such Lender does not intend to make available to the
Administrative Agent its portion of the Borrowing or Borrowings to be made on
such date, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on such date of Borrowing, and the
Administrative Agent, in reliance upon such assumption, may (in its sole
discretion and without any obligation to do so) make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Administrative Agent by such Lender and the Administrative Agent has made
available same to the Borrower, the Administrative Agent shall be entitled to
recover such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent shall promptly notify the Borrower, and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent shall also be entitled to recover from such
Lender or the Borrower, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such
corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to (x) if paid by such Lender, the overnight Federal Funds Effective
Rate or (y) if paid by the Borrower, the then applicable rate of interest,
calculated in accordance with section 2.7, for the respective Loans (but without
any requirement to pay any amounts in respect thereof pursuant to section 2.10).
(ii) Nothing in this section 2.2(f) and no subsequent termination of
the Commitments pursuant to section 4.2 or 4.3 shall be deemed to relieve any
Lender from its obligation to fulfill its Commitments hereunder and in existence
from time to time or to prejudice any rights which the Borrower may have against
any Lender as a result of any default by such Lender hereunder.
2.3. Competitive Bid Loans. (a) General. Each Lender severally agrees
that the Borrower may make Competitive Bid Borrowings under this section 2.3
from time to time on any Business Day during the period from the Closing Date
until the date occurring one month prior to the earlier of the Maturity Date or
the date the Total General Revolving Commitment is terminated, in the manner,
and subject to the terms and conditions, set forth below; provided that
notwithstanding anything to the contrary contained herein, following the making
of each Competitive Bid Borrowing, the sum of the aggregate outstanding General
Revolving Loans, the aggregate outstanding Swing Line Revolving Loans, the
Letter of Credit Outstandings and the aggregate outstanding Competitive Bid
Loans shall not exceed the Total General Revolving Commitment then in effect
(computed without regard to any Competitive Bid Reduction):
(i) Permitted Types of Competitive Bid Borrowings. The only
types of Competitive Bid Borrowings which can be made under this
Agreement are the following:
(A) a Competitive Bid Borrowing in which the rate of
interest to be paid to each Lender participating in such
Competitive Bid Borrowing shall be the fixed rate per annum
bid by such Lender for such Competitive Bid Borrowing as
provided below (a "Fixed Rate Competitive Bid Borrowing"), and
(B) a Competitive Bid Borrowing in which the rate of
interest to be paid to each Lender participating in such
Competitive Bid Borrowing shall be the Adjusted LIBO Rate for
the Interest Period applicable to such Competitive Bid
Borrowing plus the margin in basis points which was bid by
such Lender for such Competitive Bid Borrowing as provided
below (an "Adjusted LIBO Rate Competitive Bid Borrowing").
(ii) Notice of Competitive Bid Borrowing. The Borrower may
request a Competitive Bid Borrowing under this section 2.3 by
delivering to the Administrative Agent, by telecopier, electronic
e-mail transmission, telex or cable, confirmed immediately in writing,
a notice of a Competitive Bid Borrowing (a "Notice of Competitive Bid
Borrowing"), in substantially the form of Exhibit B-2 hereto,
specifying (x) the date and aggregate amount of the proposed
Competitive Bid Borrowing, (y) the maturity date for repayment of each
Competitive Bid Loan to be made as part of such Competitive Bid
Borrowing (which maturity date shall be the last day of an Interest
Period of one, two, three or six months duration following the date of
such Competitive Bid Borrowing, but in no event later than the Maturity
Date), (z) the interest payment date or dates relating thereto, and any
other terms to be applicable to such Competitive Bid Borrowing, not
later than 10:00 A.M. (local time at the Notice Office)
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(A) at least two Business Days prior to the date of
the proposed Competitive Bid Borrowing, if the Borrower shall
specify in the Notice of Competitive Bid Borrowing that the
Borrowing shall be a Fixed Rate Competitive Bid Borrowing), or
(B) at least five Business Days prior to the date of
the proposed Competitive Bid Borrowing, if the Borrower shall
instead specify in the Notice of Competitive Bid Borrowing
that the Borrowing shall be an Adjusted LIBO Rate Competitive
Bid Borrowing.
A Notice of Competitive Bid Borrowing shall specify that the requested
Borrowing is either a Fixed Rate Competitive Bid Borrowing or an
Adjusted LIBO Rate Competitive Bid Borrowing, but not both or either in
the alternative. Competitive Bid Loans shall only be made in U.S.
Dollars. If the Borrower and the Administrative Agent shall have so
agreed, the Borrower shall pay to the Administrative Agent, for its own
account, in connection with each request for a Competitive Bid
Borrowing, promptly after receipt of an invoice therefor, a competitive
bid administrative fee in such amount as has been so agreed. The
Administrative Agent shall in turn promptly notify each Lender of each
request for a Competitive Bid Borrowing received by it from the
Borrower by sending such Lender a copy of the related Notice of
Competitive Bid Borrowing.
(iii) Bidding by Lenders. Each Lender may, if, in its sole
discretion, it elects to do so, irrevocably offer to make one or more
Competitive Bid Loans to the Borrower as part of such proposed
Competitive Bid Borrowing at a rate or rates of interest specified by
such Lender in its sole discretion but responsive to the paramaters for
a Fixed Rate Competitive Bid Borrowing or an Adjusted LIBO Rate
Competitive Bid Borrowing, as specified in such Notice of Competitive
Bid Borrowing, by notifying the Administrative Agent (which shall give
prompt notice thereof to the Borrower), before 10:00 A.M. (local time
at the Notice Office) (A) on the Business Day prior to the date of such
proposed Competitive Bid Borrowing, in the case of a Notice of
Competitive Bid Borrowing requesting a Fixed Rate Competitive Bid
Borrowing and (B) four Business Days before the date of such proposed
Competitive Bid Borrowing, in the case of a Notice of Competitive Bid
Borrowing requesting an Adjusted LIBO Rate Competitive Bid Borrowing,
of the minimum amount and maximum amount of each Competitive Bid Loan
which such Lender would be willing to make as part of such proposed
Competitive Bid Borrowing (which amounts may, subject to the proviso to
the first sentence of this section 2.3(a), exceed such Lender's General
Revolving Commitment), the margin or rate or rates of interest therefor
(specified to four decimal places) and such Lender's Applicable Lending
Office with respect to such Competitive Bid Loan; provided that if the
Administrative Agent in its capacity as a Lender shall, in its sole
discretion, elect to make any such offer, it shall notify the Borrower
of such offer before 9:00 A.M. (local time at the Notice Office) on the
date on which notice of such election is to be given to the
Administrative Agent by the other Lenders. If any Lender shall elect
not to make such an offer, such Lender shall so notify the
Administrative Agent, before 10:00 A.M. (local time at the Notice
Office) on the date on which notice of such election is to be given to
the Administrative Agent by the other Lenders, and such Lender shall
not be obligated to, and shall not, make any Competitive Bid Loan as
part of such Competitive Bid Borrowing; provided that the failure by
any Lender to give such notice shall not cause such Lender to be
obligated to make any Competitive Bid Loan as part of such proposed
Competitive Bid Borrowing. It is understood and agreed that the
Borrower may not accept any offer to make a Competitive Bid Loan if
such offer is not made on a timely basis or otherwise fails to comply
with the requirements of this Agreement.
(iv) Acceptance of Bids or Cancellation of Competitive Bid
Borrowing. The Borrower shall, in turn, (A) before 12:00 noon (local
time at the Notice Office) on the date of such proposed Competitive Bid
Borrowing, in the case of a Notice of Competitive Bid Borrowing
delivered pursuant to clause (A) of paragraph (i) above and (B) before
12:00 noon (local time at the Notice Office) three Business Days before
the date of such proposed Competitive Bid Borrowing, in the case of a
Notice of Competitive Bid Borrowing delivered pursuant to clause (B) of
paragraph (i) above, either
(x) cancel such Competitive Bid Borrowing by giving
the Administrative Agent notice to that effect, or
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(y) accept one or more of the offers made by any
Lender or Lenders pursuant to paragraph (iii) above, in
ascending order, from the lowest cost to the highest cost
acceptable to the Borrower in its sole discretion (subject, if
necessary, to ratable allocation between or among Lenders
offering the same interest rates or margins), by giving notice
to the Administrative Agent of the amount of each Competitive
Bid Loan (which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum amount,
notified to the Borrower by the Administrative Agent on behalf
of such Lender for such Competitive Bid Loan pursuant to
paragraph (iii) above) to be made by each Lender as part of
such Competitive Bid Borrowing, and reject any remaining
offers made by Lenders pursuant to paragraph (iii) above by
giving the Administrative Agent notice to that effect,
provided that the aggregate principal amount of each
Competitive Bid Borrowing may not exceed the applicable amount
requested in the relevant Notice of Competitive Bid Borrowing.
(v) Notice to Lenders of Cancellation. If the Borrower
notifies the Administrative Agent that such Competitive Bid Borrowing
is cancelled pursuant to paragraph (iv)(x) above, the Administrative
Agent shall give prompt notice thereof to the Lenders and such
Competitive Bid Borrowing shall not be made.
(vi) Borrowing Procedures. If the Borrower accepts one or more
of the offers made by any Lender or Lenders pursuant to paragraph
(iv)(y) above, the Administrative Agent shall in turn promptly notify
(A) each Lender that has made an offer as described in paragraph (iii)
above, of the date and aggregate amount of such Competitive Bid
Borrowing and whether or not any offer or offers made by such Lender
pursuant to paragraph (iii) above have been accepted by the Borrower,
(B) each Lender that is to make a Competitive Bid Loan as part of such
Competitive Bid Borrowing, of the amount of each Competitive Bid Loan
to be made by such Lender as part of such Competitive Bid Borrowing and
(C) each Lender that is to make a Competitive Bid Loan as part of such
Competitive Bid Borrowing, upon receipt, that the Administrative Agent
has (to the extent not previously delivered) received forms of
documents appearing to fulfill the applicable conditions set forth in
section 6. Each Lender that is to make a Competitive Bid Loan as part
of such Competitive Bid Borrowing shall, before 12:00 noon (local time
at the Notice Office) on the date of such Competitive Bid Borrowing
specified in the notice received from the Administrative Agent pursuant
to clause (A) of the preceding sentence or any later time when such
Lender shall have received notice from the Administrative Agent
pursuant to clause (C) of the preceding sentence, make available for
the account of its Applicable Lending Office to the Administrative
Agent at its Payment Office such Lender's portion of such Competitive
Bid Borrowing, in same day funds. Upon fulfillment of the applicable
conditions set forth in section 6 and after receipt by the
Administrative Agent of such funds, the Administrative Agent will make
such funds available to the Borrower at the Administrative Agent's
Payment's Office. Promptly after each Competitive Bid Borrowing the
Administrative Agent will notify each Lender of the amount of the
Competitive Bid Borrowing, the consequent Competitive Bid Reduction and
the dates upon which such Competitive Bid Reduction commenced and will
terminate.
(b) Amount of Competitive Bid Borrowings. Each Competitive Bid
Borrowing shall be in an aggregate amount not less than $10,000,000 or an
integral multiple of $1,000,000 in excess thereof and, following the making of
each Competitive Bid Borrowing, the Borrower shall be in compliance with the
limitations set forth in the proviso to the first sentence of section 2.3(a)
above.
(c) Borrowings, Repayments, Prepayments and Reborrowings; Time Between
Competitive Bid Borrowings. Within the limits and on the conditions set forth in
this section 2.3, the Borrower may from time to time borrow under this section
2.3, repay or prepay pursuant to section 2.3(d) below, and reborrow under this
section 2.3, provided that a Competitive Bid Borrowing shall not be made within
10 Business Days of the date of any other Competitive Bid Borrowing.
(d) Repayment of Competitive Bid Loans, etc. The Borrower shall repay
to the Administrative Agent for the account of each Lender which has made a
Competitive Bid Loan, or each other holder of a Competitive Bid Note, on the
maturity date of each Competitive Bid Loan (such maturity date being that
specified by the Borrower for repayment of such Competitive Bid Loan in the
related Notice of Competitive Bid Borrowing delivered pursuant to section
2.3(a)(ii) above and provided in the Competitive Bid Note evidencing such
Competitive Bid Loan), the then
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<PAGE> 27
unpaid principal amount of such Competitive Bid Loan. The Borrower shall have no
right to prepay any principal amount of any Competitive Bid Loan unless, and
then only on the terms, specified by the Borrower for such Competitive Bid Loan
in the related Notice of Competitive Bid Borrowing delivered pursuant to section
2.3(a)(ii) above and set forth in the Competitive Bid Note evidencing such
Competitive Bid Loan. Competitive Bid Loans made by any Lender shall be subject
to mandatory prepayment in accordance with the provisions of section 5.2 hereof.
Any such mandatory prepayment shall be accompanied by accrued interest on the
amount of the prepayment to the date of prepayment and such breakage
compensation as may be reasonably determined by such Lender as necessary to
compensate it for all reasonable losses, expenses and liabilities (including,
without limitation, any loss, expense or liability incurred by reason of the
liquidation or reemployment of deposits or other funds required by such Lender
to fund its Competitive Bid Loans) which such Lender may sustain by reason of
such mandatory prepayment.
(e) Interest on Competitive Bid Loans. The Borrower shall pay interest
on the unpaid principal amount of each Competitive Bid Loan from the date of
such Competitive Bid Loan to the date the principal amount of such Competitive
Bid Loan is repaid in full, at the rate of interest for such Competitive Bid
Loan specified by the Lender making such Competitive Bid Loan in its notice with
respect thereto delivered pursuant to section 2.3(a)(iii) above, payable on the
interest payment date or dates specified by the Borrower for such Competitive
Bid Loan in the related Notice of Competitive Bid Borrowing delivered pursuant
to section 2.3(a)(ii) above, as provided in the Competitive Bid Note evidencing
such Competitive Bid Loan.
(f) Competitive Bid Notes. The indebtedness of the Borrower resulting
from each Competitive Bid Loan made to the Borrower as part of a Competitive Bid
Borrowing shall be evidenced by the Competitive Bid Note of the Borrower payable
to the order of the Lender making such Competitive Bid Loan.
2.4. Notes; Loan Accounts. (a) Forms of Notes. The Borrower's
obligation to pay the principal of, and interest on, the Loans made to it by
each Lender shall be evidenced (i) in the case of a General Revolving Loan, by a
promissory note of the Borrower substantially in the form of Exhibit A-1 with
blanks appropriately completed in conformity herewith (each a "GENERAL REVOLVING
NOTE" and, collectively, the "GENERAL REVOLVING NOTES"), (ii) in the case of a
Swing Line Revolving Loan, by a promissory note of the Borrower substantially in
the form of Exhibit A-2 with blanks appropriately completed in conformity
herewith (the "SWING LINE REVOLVING NOTE"), and (iii) in the case of a
Competitive Bid Loan, by a promissory note of the Borrower substantially in the
form of Exhibit A-3 with blanks appropriately completed in conformity herewith
(a "COMPETITIVE BID NOTE" and collectively, the "COMPETITIVE BID NOTES"). The
form of Competitive Bid Note issued to a Lender hereunder may be in a "grid"
form with no specific dollar amount mentioned in words or figures and covering
all Competitive Bid Loans made by such Lender, or if any Lender so requests, the
Borrower will issue one or more Competitive Bid Notes in specified
denominations, as evidence of particular Competitive Bid Loans, in which case
the form of Competitive Bid Note attached hereto as Exhibit A-3 shall be
appropriately completed to reflect such information.
(b) Terms of General Revolving Notes. The General Revolving Note issued
by the Borrower to a Lender with a General Revolving Commitment shall: (i) be
executed by the Borrower; (ii) be payable to the order of such Lender and be
dated on or prior to the Closing Date (or if later, the date the of the first
General Revolving Loan which is outstanding thereunder); (iii) be payable in the
principal amount of General Revolving Loans evidenced thereby; (iv) mature on
the Maturity Date; (v) bear interest as provided in section 2.7 in respect of
the Prime Rate Loans or LIBOR Loans, as the case may be, evidenced thereby; (vi)
be subject to mandatory prepayment as provided in section 5.2; and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(c) Terms of Swing Line Revolving Note. The Swing Line Revolving Note
issued by the Borrower to the Swing Line Lender shall: (i) be executed by the
Borrower; (ii) be payable to the order of such Lender and be dated on or prior
to the Closing Date (or if later, the date the of the first Swing Line Revolving
Loan which is outstanding thereunder); (iii) be payable in the principal amount
of Swing Line Revolving Loans evidenced thereby; (iv) mature as to any Swing
Line Revolving Loan on the maturity date therefor (which shall not in any event
exceed 30 days) specified in the Notice of Revolving Borrowing related thereto;
(v) bear interest as provided in section 2.7 in respect of the Prime Rate Loans
or Money Market Rate Loans evidenced thereby; (vi) be subject to mandatory
prepayment as provided in section 5.2; and (vii) be entitled to the benefits of
this Agreement and the other Credit Documents.
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<PAGE> 28
(d) Terms of Competitive Bid Notes. The Competitive Bid Note issued to
a Lender which has made a Competitive Bid Loan shall: (i) be executed by the
Borrower; (ii) be payable to the order of such Lender and be dated on or prior
to the date the first Competitive Bid Loan is made by such Lender; (iii) be
payable in the principal amount of the Competitive Bid Loans evidenced thereby;
(iv) mature as to any Competitive Bid Loan evidenced thereby on the maturity
date selected therefor in the applicable Notice of Competitive Bid Borrowing;
(v) bear interest as to any such Competitive Bid Loan at the rate and payable on
the dates provided therefor as contemplated by sections 2.3(e) and 2.7; (vi) be
subject in the case of any Competitive Bid Loan evidenced thereby to optional or
mandatory prepayment only as contemplated by section 2.3(d); and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(e) Loan Accounts of Lenders. Each Lender shall maintain in accordance
with its usual practice an account or accounts 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.
(f) Loan Accounts of Administrative Agent. The Administrative Agent
shall maintain accounts in which it shall record (i) the amount of each Loan
made hereunder, the Type thereof, and the Interest Period and applicable
interest rate if such Loan is a LIBOR Loan, (ii) the amount of any principal due
and payable or to become due and payable from the Borrower to each Lender
hereunder, and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender's share thereof.
(g) Effect of Loan Accounts, etc. The entries made in the accounts
maintained pursuant to section 2.4(e) and (f) 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 accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay or prepay the Loans in accordance with the terms of this
Agreement.
(h) Endorsements of Amounts on Notes Prior to Transfer. Each Lender
will, prior to any transfer of any of the Notes issued to it by the Borrower,
endorse on the reverse side thereof or the grid attached thereto the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in any such notation shall not affect the Borrower's obligations in
respect of such Loans.
2.5. Conversions of General Revolving Loans. The Borrower shall have
the option to Convert on any Business Day all or a portion at least equal to the
applicable Minimum Borrowing Amount of the outstanding principal amount of its
General Revolving Loans of one Type into a Borrowing or Borrowings pursuant to
the same Facility of another Type of Loans which can be made pursuant to such
Facility, provided that: (i) no partial Conversion of a Borrowing of LIBOR Loans
shall reduce the outstanding principal amount of the LIBOR Loans made pursuant
to such Borrowing to less than the Minimum Borrowing Amount applicable thereto;
(ii) any Conversion of LIBOR Loans into Prime Rate Loans shall be made on, and
only on, the last day of an Interest Period for such LIBOR Loans; (iii) Prime
Rate Loans may only be Converted into LIBOR Loans if no Default under section
10.1(a) or Event of Default is in existence on the date of the Conversion unless
the Required Lenders otherwise agree; and (iv) Borrowings of LIBOR Loans
resulting from this section 2.5 shall conform to the requirements of section
2.2(d). Each such Conversion shall be effected by the Borrower giving the
Administrative Agent at its Notice Office, prior to 11:00 A.M. (local time at
such Notice Office), at least three Business Days' (or prior to 11:00 A.M.
(local time at such Notice Office) same Business Day's, in the case of a
Conversion into Prime Rate Loans) prior written notice (or telephonic notice
promptly confirmed in writing if so requested by the Administrative Agent) (each
a "NOTICE OF CONVERSION"), substantially in the form of Exhibit B-3, specifying
the Loans to be so Converted, the Type of Loans to be Converted into and, if to
be Converted into a Borrowing of LIBOR Loans, the Interest Period to be
initially applicable thereto. The Administrative Agent shall give each Lender
prompt notice of any such proposed Conversion affecting any of its Loans. For
the avoidance of doubt, the prepayment or repayment of any General Revolving
Loans out of the proceeds of other General Revolving Loans by the Borrower is
not considered a Conversion of General Revolving Loans into other General
Revolving Loans.
2.6. Refunding of, or Participation in, Swing Line Revolving Loans. (a)
If any Event of Default exists, the Swing Line Lender may, in its sole and
absolute discretion, direct that the Swing Line Revolving Loans
23
<PAGE> 29
owing to it be refunded by delivering a notice to such effect to the
Administrative Agent, specifying the aggregate principal amount thereof (a
"NOTICE OF SWING LINE REFUNDING"). Promptly upon receipt of a Notice of Swing
Line Refunding, the Administrative Agent shall give notice of the contents
thereof to the Lenders with General Revolving Commitments and, unless an Event
of Default specified in section 10.1(h) in respect of the Borrower has occurred,
the Borrower. Each such Notice of Swing Line Refunding shall be deemed to
constitute delivery by the Borrower of a Notice of Revolving Borrowing
requesting General Revolving Loans consisting of Prime Rate Loans in the amount
of the Swing Line Revolving Loans to which such Notice of Swing Line Refunding
relates. Each Lender with a General Revolving Commitment (including the Swing
Line Lender giving the Notice of Swing Line Refunding) hereby unconditionally
agrees (notwithstanding that any of the conditions specified in section 6.2
hereof or elsewhere in this Agreement shall not have been satisfied, but subject
to the provisions of paragraph (b) and (d) below) to make a General Revolving
Loan to the Borrower in an amount equal to such Lender's General Revolving
Facility Percentage of the aggregate amount of the Swing Line Revolving Loans to
which such Notice of Swing Line Refunding relates. Each such Lender shall make
the amount of such General Revolving Loan available to the Administrative Agent
in immediately available funds at the Payment Office not later than 2:00 P.M.
(local time at the Payment Office), if such notice is received by such Lender
prior to 11:00 A.M. (local time at its Domestic Lending Office), or not later
than 2:00 P.M. (local time at the Payment Office) on the next Business Day, if
such notice is received by such Lender after such time. The proceeds of such
General Revolving Loans shall be made immediately available to the Swing Line
Lender giving such Notice of Swing Line Refunding and applied by it to repay the
principal amount of the Swing Line Revolving Loans to which such Notice of Swing
Line Refunding related. The Borrower irrevocably and unconditionally agrees
that, notwithstanding anything to the contrary contained in this Agreement,
General Revolving Loans made as herein provided in response to a Notice of Swing
Line Refunding shall constitute General Revolving Loans hereunder consisting of
Prime Rate Loans.
(b) If prior to the time a General Revolving Loan would otherwise have
been made as provided above as a consequence of a Notice of Swing Line
Refunding, any of the events specified in section 10.1(h) shall have occurred in
respect of the Borrower or one or more of the Lenders with General Revolving
Commitments shall determine that it is legally prohibited from making a General
Revolving Loan under such circumstances, each Lender (other than the Swing Line
Lender giving the Notice of Swing Line Refunding), or each Lender (other than
such Swing Line Lender) so prohibited, as the case may be, shall, on the date
such General Revolving Loan would have been made by it (the "PURCHASE DATE"),
purchase an undivided participating interest in the outstanding Swing Line
Revolving Loans to which such Notice of Swing Line Refunding related, in an
amount (the "SWING LINE PARTICIPATION AMOUNT") equal to such Lender's General
Revolving Facility Percentage of such Swing Line Revolving Loans. On the
Purchase Date, each such Lender or each such Lender so prohibited, as the case
may be, shall pay to the Swing Line Lender, in immediately available funds, such
Lender's Swing Line Participation Amount, and promptly upon receipt thereof the
Swing Line Lender shall, if requested by such other Lender, deliver to such
Lender a participation certificate, dated the date of the Swing Line Lender's
receipt of the funds from, and evidencing such Lender's participating interest
in such Swing Line Revolving Loans and its Swing Line Participation Amount in
respect thereof. If any amount required to be paid by a Lender to the Swing Line
Lender pursuant to the above provisions in respect of any Swing Line
Participation Amount is not paid on the date such payment is due, such Lender
shall pay to the Swing Line Lender on demand interest on the amount not so paid
at the overnight Federal Funds Effective Rate from the due date until such
amount is paid in full.
(c) Whenever, at any time after the Swing Line Lender has received from
any other Lender such Lender's Swing Line Participation Amount, the Swing Line
Lender receives any payment from or on behalf of the Borrower on account of the
related Swing Line Revolving Loans, the Swing Line Lender will promptly
distribute to such Lender its General Revolving Facility Percentage of such
payment on account of its Swing Line Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's participating interest was outstanding and funded);
PROVIDED, HOWEVER, that in the event such payment received by the Swing Line
Lender is required to be returned, such Lender will return to the Swing Line
Lender any portion thereof previously distributed to it by the Swing Line
Lender.
(d) Each Lender's obligation to make General Revolving Loans and/or to
purchase participations in connection with a Notice of Swing Line Refunding
(which shall in all events be within such Lender's Unutilized General Revolving
Commitment, taking into account all outstanding participations in connection
with Swing Line Refundings) shall be subject to the conditions that
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<PAGE> 30
(i) such Lender shall have received a Notice of Swing Line
Refunding complying with the provisions hereof; and
(ii) at the time the Swing Line Revolving Loans which are the
subject of such Notice of Swing Line Refunding were made, the Swing
Line Lender making the same had no actual written notice from another
Lender that an Event of Default had occurred and was continuing);
but otherwise shall be absolute and unconditional, shall be solely for the
benefit of the Swing Line Lender which gives such Notice of Swing Line
Refunding, and shall not be affected by any circumstance, including, without
limitation, (A) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against any other Lender, any Credit Party, or any
other person, or any Credit Party may have against any Lender or other person,
as the case may be, for any reason whatsoever; (B) the occurrence or continuance
of a Default or Event of Default; (C) any event or circumstance involving a
Material Adverse Effect upon the Borrower; (D) any breach of any Credit Document
by any party thereto; or (E) any other circumstance, happening or event, whether
or not similar to any of the foregoing.
2.7. Interest. (a) Interest Rate for Prime Rate Loans. During such
periods as a General Revolving Loan or a Swing Line Revolving Loan is a Prime
Rate Loan, the unpaid principal amount thereof shall bear interest at a
fluctuating rate per annum which shall at all times be equal to the Prime Rate
in effect from time to time.
(b) Interest Rate for LIBOR Loans. During such periods as a General
Revolving Loan is a LIBOR Loan, the unpaid principal amount thereof shall bear
interest at a rate per annum which shall at all times during any Interest Period
applicable thereto be the Applicable LIBOR Margin (as defined below) for such
LIBOR Loan plus the relevant Adjusted LIBO Rate for such Interest Period.
(c) Interest Rate for Money Market Rate Loans. During such periods as a
Swing Line Revolving Loan is a Money Market Rate Loan, the unpaid principal
amount thereof shall bear interest at the rate per annum which shall be equal to
the Quoted Rate therefor.
(d) Interest Rate for Competitive Bid Loans. The Borrower shall pay
interest on each Competitive Bid loan in accordance with the provisions of
section 2.3(e).
(e) Default Interest. Notwithstanding the above provisions, if a
Default under section 10.1(a) or Event of Default is in existence, all
outstanding amounts of principal and, to the extent permitted by law, all
overdue interest, in respect of each Loan shall bear interest, payable on
demand, at a fluctuating rate per annum equal to 2% per annum above the interest
rate which would be applicable under section 2.7(a) to Prime Rate Loans in
effect from time to time. If any amount (other than the principal of and
interest on the Loans) payable by the Borrower under the Credit Documents is not
paid when due, such amount shall bear interest, payable on demand, at a
fluctuating rate per annum equal 2% per annum above the interest rate which
would be applicable under section 2.7(a) to Prime Rate Loans in effect from time
to time.
(f) Accrual and Payment of Interest. Interest shall accrue from and
including the date of any Borrowing to but excluding the date of any prepayment
or repayment thereof and shall be payable:
(i) in the case of any Swing Line Revolving Loan, (A)
at the maturity date thereof, which shall in any event be less than 30
days, (B) on any prepayment (on the amount prepaid), and (C) after
maturity (whether by acceleration or otherwise), on demand; and
(ii) in the case of any General Revolving Loan, (A)
which is a Prime Rate Loan, monthly in arrears on the first Business
Day of the succeeding calendar month, (B) which is a LIBOR Loan, on the
last day of each Interest Period applicable thereto and, in the case of
an Interest Period in excess of three months, on the dates which are
successively three months after the commencement of such Interest
Period, and (C) on any repayment, prepayment or Conversion (on the
amount repaid, prepaid or Converted), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand; and
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<PAGE> 31
(iii) in the case of any Competitive Bid Loan, (A) on
the interest payment date or dates contemplated by section 2.3(e), at
the maturity date thereof, which shall in any event be no more than six
months, (B) on any prepayment (on the amount prepaid), and (C) after
maturity (whether by acceleration or otherwise), on demand.
(g) Computations of Interest. All computations of interest hereunder
shall be made in accordance with section 12.7(b).
(h) Interest Margins. As used herein, the term "Applicable LIBOR
Margin", as applied to any General Revolving Loan which is a LIBOR Loan, means
for any date the particular rate per annum determined by the Administrative
Agent in accordance with the Pricing Grid Table which appears below, based upon
the ratings by Moody's and S&P, respectively, applicable on such date to the
Index Debt, and the following provisions:
(i) Initially, until changed hereunder in accordance with the
following provisions, the Applicable LIBOR Margin will be 50.00 basis
points per annum.
(ii) Notwithstanding the above provisions, during any period
when a Default under section 10.1(a) or an Event of Default has
occurred and is continuing, the Applicable LIBOR Margin shall be the
highest rate per annum indicated therefor in the Pricing Grid Table,
regardless of the then ratings on the Index Debt.
(iii) For purposes of determinations of the Applicable LIBOR
Margin, (1) if either Moody's or S&P shall not have in effect a rating
for the Index Debt (other than by reason of the circumstances referred
to in the last sentence of this paragraph), then such rating agency
shall be deemed to have established a rating in Category 5; (2) if the
ratings established or deemed to have been established by Moody's and
S&P for the Index Debt shall fall within different Categories, the
Applicable Rate shall be based on the higher of the two ratings unless
one of the two ratings is two or more Categories lower than the other,
in which case the Applicable Rate shall be determined by reference to
the Category next below that of the higher of the two ratings; and (3)
if the ratings established or deemed to have been established by
Moody's and S&P for the Index Debt shall be changed (other than as a
result of a change in the rating system of Moody's or S&P), such change
shall be effective as of the date on which it is first announced by the
applicable rating agency. Each change in the Applicable LIBOR Margin
shall apply during the period commencing on the effective date of such
change and ending on the date immediately preceding the effective date
of the next such change. If the rating system of Moody's or S&P shall
change, or if either such rating agency shall cease to be in the
business of rating corporate debt obligations, the Borrower and the
Lenders shall negotiate in good faith to amend this definition to
reflect such changed rating system or the unavailability of ratings
from such rating agency and, pending the effectiveness of any such
amendment, the Applicable LIBOR Margin Rate shall be determined by
reference to the rating most recently in effect prior to such change or
cessation.
(iv) Any changes in the Applicable LIBOR Margin shall be
determined by the Administrative Agent in accordance with the above
provisions and the Administrative Agent will promptly provide notice of
such determinations to the Borrower and the Lenders. Any such
determination by the Administrative Agent pursuant to this section
2.7(h) shall be conclusive and binding absent manifest error.
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<PAGE> 32
PRICING GRID TABLE
(expressed in basis points)
<TABLE>
<CAPTION>
--------------------------- -------------------------- -------------------
Index Debt Ratings Applicable LIBOR Margin Facility Fee Rate
--------------------------- -------------------------- -------------------
<S> <C> <C>
Category 1 40.00 10.00
A- or better by S&P
A2 or better by Moody's
--------------------------- -------------------------- -------------------
Category 2 50.00 12.50
BBB+ by S&P
Baa1 by Moody's
--------------------------- -------------------------- -------------------
Category 3 60.00 15.00
BBB by S&P
Baa2 by Moody's
--------------------------- -------------------------- -------------------
Category 4 80.00 20.00
BBB- by S&P
Baa3 by Moody's
--------------------------- -------------------------- -------------------
Category 5 110.00 27.50
BB+ or less by S&P
Ba1 or less by Moody's
--------------------------- -------------------------- -------------------
</TABLE>
(i) Information as to Interest Rates. The Administrative Agent upon
determining the interest rate for any Borrowing shall promptly notify the
Borrower and the affected Lenders thereof. If the Administrative Agent is unable
to determine the Adjusted LIBO Rate for any Borrowing of LIBOR Loans based on
the quotation service referred to in clause (i) of the definition of the term
Adjusted LIBO Rate, it will promptly so notify the Reference Banks and each
Reference Bank will furnish the Administrative Agent timely information for the
purpose of determining the Adjusted LIBO Rate for such Borrowing. If any one or
more of the Reference Banks shall not timely furnish such information, the
Administrative Agent shall determine the Adjusted LIBO Rate for such Borrowing
on the basis of timely information furnished by the remaining Reference Banks.
2.8. Selection and Continuation of Interest Periods. (a) The Borrower
shall have the right
(x) at the time it gives a Notice of Revolving Borrowing or
Notice of Conversion in respect of the making of or Conversion into a
Borrowing of General Revolving Loans consisting of LIBOR Loans, to
select in such Notice the Interest Period to be applicable to such
Borrowing, and
(y) prior to 12:00 noon (local time at the Notice Office) on
the third Business Day prior to the expiration of an Interest Period
applicable to a Borrowing of General Revolving Loans consisting of
LIBOR Loans, to elect by giving the Administrative Agent written or
telephonic notice (in the case of telephonic notice, promptly confirmed
in writing if so requested by the Administrative Agent) to Continue all
or the Minimum Borrowing Amount of the principal amount of such Loans
as one or more Borrowings of LIBOR Loans and to select the Interest
Period to be applicable to any such Borrowing (any such notice, a
"NOTICE OF CONTINUATION"),
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<PAGE> 33
which Interest Period shall, at the option of the Borrower, be a one, two, three
or six month period; provided, that notwithstanding anything to the contrary
contained above, the Borrower's right to select an Interest Period or to effect
any Continuation shall be subject to the applicable provisions of section 2.10
and to the following:
(i) the initial Interest Period for any Borrowing of LIBOR
Loans shall commence on the date of such Borrowing (the date of a
Borrowing resulting from a Conversion or Continuation shall be the date
of such Conversion or Continuation) and each Interest Period occurring
thereafter in respect of such Borrowing shall commence on the day on
which the next preceding Interest Period expires;
(ii) if any Interest Period begins on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iii) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day, provided that if any Interest Period
would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business
Day;
(iv) no Interest Period for any LIBOR Loan may be selected
which would end after the Maturity Date;
(v) each Borrowing of LIBOR Loans resulting from any
Continuation shall be in at least the Minimum Borrowing Amount
applicable thereto; and
(vi) no Interest Period may be elected at any time when a
Default under section 10.1(a) or an Event of Default is then in
existence unless the Required Lenders otherwise agree.
(b) If upon the expiration of any Interest Period the Borrower has
failed to (or may not) elect a new Interest Period to be applicable to the
respective Borrowing of LIBOR Loans as provided above, the Borrower shall be
deemed to have elected to Convert such Borrowing to Prime Rate Loans effective
as of the expiration date of such current Interest Period.
2.9. Increased Costs, Illegality, etc. (a) In the event that (x) in the
case of clause (i) below, the Administrative Agent or (y) in the case of clauses
(ii) and (iii) below, any Lender, shall have determined on a reasonable basis
(which determination shall, absent manifest error, be final and conclusive and
binding upon all parties hereto):
(i) on any date for determining the Adjusted LIBO Rate for any
Interest Period that, by reason of any changes arising after the
Effective Date affecting the interbank Eurodollar market, adequate and
fair means do not exist for ascertaining the applicable interest rate
on the basis provided for in the definition of Adjusted LIBO Rate; or
(ii) at any time, that such Lender shall incur increased costs
or reductions in the amounts received or receivable hereunder in an
amount which such Lender deems material with respect to any LIBOR Loans
(other than any increased cost or reduction in the amount received or
receivable resulting from the imposition of or a change in the rate of
taxes or similar charges) because of (x) any change since the Effective
Date in any applicable law, governmental rule, regulation, guideline,
order or request (whether or not having the force of law), or in the
interpretation or administration thereof and including the introduction
of any new law or governmental rule, regulation, guideline, order or
request (such as, for example, but not limited to, a change in official
reserve requirements, but, in all events, excluding reserves includable
in the Adjusted LIBO Rate pursuant to the definition thereof) and/or
(y) other circumstances adversely affecting the interbank Eurodollar
market or the position of such Lender in such market; or
(iii) at any time, that the making or continuance of any LIBOR
Loan has become unlawful by compliance by such Lender in good faith
with any change since the Effective Date in any law, governmental rule,
regulation, guideline or order, or the interpretation or application
thereof, or would conflict with any
28
<PAGE> 34
thereof not having the force of law but with which such Lender
customarily complies or has become impracticable as a result of a
contingency occurring after the Effective Date which materially
adversely affects the interbank Eurodollar market;
then, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) above) shall (x) on or promptly following such date or time
and (y) within 10 Business Days of the date on which such event no longer exists
give notice (by telephone confirmed in writing) to the Borrower and to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x) in
the case of clause (i) above, LIBOR Loans shall no longer be available until
such time as the Administrative Agent notifies the Borrower and the Lenders that
the circumstances giving rise to such notice by the Administrative Agent no
longer exist, and any Notice of Revolving Borrowing or Notice of Conversion
given by the Borrower with respect to LIBOR Loans which have not yet been
incurred or Converted shall be deemed rescinded by the Borrower or, in the case
of a Notice of Revolving Borrowing, shall, at the option of the Borrower, be
deemed converted into a Notice of Revolving Borrowing for Prime Rate Loans to be
made on the date of Borrowing contained in such Notice of Revolving Borrowing,
(y) in the case of clause (ii) above, the Borrower shall pay to such Lender,
upon written demand therefor, such additional amounts (in the form of an
increased rate of, or a different method of calculating, interest or otherwise
as such Lender shall determine) as shall be required to compensate such Lender,
for such increased costs or reductions in amounts receivable hereunder (a
written notice as to the additional amounts owed to such Lender, showing the
basis for the calculation thereof, which basis must be reasonable, submitted to
the Borrower by such Lender shall, absent manifest error, be final and
conclusive and binding upon all parties hereto) and (z) in the case of clause
(iii) above, the Borrower shall take one of the actions specified in section
2.9(b) as promptly as possible and, in any event, within the time period
required by law.
(b) At any time that any LIBOR Loan is affected by the circumstances
described in section 2.9(a)(ii) or (iii), the Borrower may (and in the case of a
LIBOR Loan affected pursuant to section 2.9(a)(iii) the Borrower shall) either
(i) if the affected LIBOR Loan is then being made pursuant to a Borrowing, by
giving the Administrative Agent telephonic notice (confirmed promptly in
writing) thereof on the same date that the Borrower was notified by a Lender
pursuant to section 2.9(a)(ii) or (iii), cancel said Borrowing, convert the
related Notice of Revolving Borrowing into one requesting a Borrowing of Prime
Rate Loans or require the affected Lender to make its requested Loan as a Prime
Rate Loan, or (ii) if the affected LIBOR Loan is then outstanding, upon at least
one Business Day's notice to the Administrative Agent, require the affected
Lender to Convert each such LIBOR Loan into a Prime Rate Loan, provided that if
more than one Lender is affected at any time, then all affected Lenders must be
treated the same pursuant to this section 2.9(b).
(c) If any Lender shall have determined that after the Effective Date,
the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged by law with the interpretation or administration thereof, or
compliance by such Lender or its parent corporation with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank, or comparable agency, in each case made
subsequent to the Effective Date, has or would have the effect of reducing by an
amount reasonably deemed by such Lender to be material the rate of return on
such Lender's or its parent corporation's capital or assets as a consequence of
such Lender's commitments or obligations hereunder to a level below that which
such Lender or its parent corporation could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender's or
its parent corporation's policies with respect to capital adequacy), then from
time to time, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or its parent corporation for
such reduction. Each Lender, upon determining in good faith that any additional
amounts will be payable pursuant to this section 2.9(c), will give prompt
written notice thereof to the Borrower, which notice shall set forth, in
reasonable detail, the basis of the calculation of such additional amounts,
which basis must be reasonable, although the failure to give any such notice
shall not release or diminish any of the Borrower's obligations to pay
additional amounts pursuant to this section 2.9(c) upon the subsequent receipt
of such notice.
(d) Notwithstanding anything in this Agreement to the contrary, (i) no
Lender shall be entitled to compensation or payment or reimbursement of other
amounts under section 2.9 or 3.5 for any amounts incurred or accruing more than
180 days prior to the giving of notice to the Borrower of additional costs or
other amounts of the
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nature described in such sections, and (ii) no Lender shall demand compensation
for any reduction referred to in section 2.9(c) or payment or reimbursement of
other amounts under section 3.5 if it shall not at the time be the general
policy or practice of such Lender to demand such compensation, payment or
reimbursement in similar circumstances under comparable provisions of other
credit agreements.
2.10. Compensation. The Borrower shall compensate each applicable
Lender, upon its written request (which request shall set forth the detailed
basis for requesting and the method of calculating such compensation), for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Lender to fund its LIBOR Loans or
Money Market Rate Loans) which such Lender may sustain: (i) if for any reason
(other than a default by such Lender or the Administrative Agent), (A) a
Borrowing of LIBOR Loans does not occur on a date specified therefor in a Notice
of Borrowing, Notice of Conversion or Notice of Continuation (whether or not
rescinded or withdrawn by or on behalf of such Borrower or deemed rescinded or
withdrawn pursuant to section 2.9(a)), or (B) a Borrowing of Money Market Rate
Loans does not occur on a date specified therefor in a Notice of Borrowing; (ii)
if any repayment, prepayment, Conversion or Continuation of any of its LIBOR
Loans occurs on a date which is not the last day of an Interest Period
applicable thereto; (iii) if any repayment or prepayment of any Money Market
Rate Loan occurs on a date which is not the maturity date thereof; (iv) if any
prepayment of any LIBOR Loans or Money Market Rate Loans, as the case may be, is
not made on any date specified in a notice of prepayment given by or on behalf
of the Borrower; (v) if the Borrower, pursuant to section 2.11(b) hereof,
requires any Lender (other than a Defaulting Lender) to transfer its LIBOR Loans
and/or Money Market Rate Loans, as the case may be, on any date other than the
last day of the Interest Period or maturity date thereof; or (vi) as a
consequence of (x) any other default by the Borrower to repay its LIBOR Loans or
Money Market Rate Loans, as the case may be, when required by the terms of this
Agreement or (y) an election made pursuant to section 2.9(b). Such loss, cost,
expense and liability to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the interest rate that would have been applicable to such
Loan, for the period from the date of such event to the last day of the then
current Interest Period therefor or the then maturity date thereof in the case
of any Money Market Rate Loan (or, in the case of a failure to effect a
Borrowing, Conversion or Continuation, for the period that would have been the
Interest Period for such Loan or the period to maturity of such Loan, in the
case of a Money Market Rate Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for Dollar
deposits of a comparable amount and period from other banks in the London
interbank market. 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 convincing evidence
of error. The Borrower shall pay such Lender the amount shown as due on any such
request within 30 days after receipt by the Borrower thereof.
2.11. Change of Lending Office; Replacement of Lenders. (a) Each Lender
agrees that, upon the occurrence of any event giving rise to the operation of
section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to such Lender, it will,
if requested by the Borrower, use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another Applicable Lending Office
for any Loans or Commitment affected by such event, PROVIDED that such
designation is made on such terms that such Lender and its Applicable Lending
Office suffer no economic, legal or regulatory disadvantage, with the object of
avoiding the consequence of the event giving rise to the operation of any such
section.
(b) If any Lender requests any compensation, reimbursement or other
payment under section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to such
Lender, or if any Lender is a Defaulting Lender, 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 the restrictions contained in section 12.4(b)), 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, which consent shall not be
unreasonably withheld or delayed, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans, 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, reimbursement or
other payments required to be made under section 2.9(a)(ii) or (iii), 2.9(c) or
3.5 with respect to such Lender, such assignment will result in a reduction in
such
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compensation, reimbursement or payments. 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.
(c) Nothing in this section 2.11 shall affect or postpone any of the
obligations of the Borrower or the right of any Lender provided in section 2.9
or 3.5.
SECTION 3. LETTERS OF CREDIT.
3.1. Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request a Letter of Credit Issuer
at any time and from time to time on or after the Closing Date and prior to the
date that is 60 Business Days prior to the Maturity Date to issue, for the
account of the Borrower or any of its Subsidiaries (the Borrower or any such
Subsidiary, a "LETTER OF CREDIT OBLIGOR"), and in support of worker
compensation, liability insurance, releases of contract retention obligations,
contract performance guarantee requirements and other bonding obligations of the
Borrower or any such other Letter of Credit Obligor incurred in the ordinary
course of its business, and such other standby obligations of the Borrower and
the other Letter of Credit Obligors that are acceptable to the Letter of Credit
Issuer, and subject to and upon the terms and conditions herein set forth, such
Letter of Credit Issuer agrees to issue from time to time, irrevocable standby
letters of credit denominated and payable in Dollars or an Alternative Currency
in such form as may be approved by such Letter of Credit Issuer and the
Administrative Agent (each such letter of credit (and each Existing Letter of
Credit described in section 3.1(d)), a "LETTER OF CREDIT" and collectively, the
"LETTERS OF CREDIT").
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued, and the Stated Amount of any outstanding Letter of Credit shall not be
increased, if after giving effect thereto the Letter of Credit Outstandings
would exceed either (x) $25,000,000 or (y) when added to the aggregate principal
amount of all General Revolving Loans and Swing Line Revolving Loans then
outstanding, an amount equal to the Total General Revolving Commitment at such
time; (ii) no individual Letter of Credit (other than any Existing Letter of
Credit) shall be issued which has an initial Stated Amount less than $100,000
unless such lesser Stated Amount is acceptable to the Letter of Credit Issuer;
and (iii) each Letter of Credit shall have an expiry date (including any renewal
periods) occurring not later than the earlier of (A) one year from the date of
issuance thereof, unless a longer period is approved by the relevant Letter of
Credit Issuer and Lenders (other than any Defaulting Lender) holding a majority
of the Total General Revolving Commitment, and (B) 15 Business Days prior to the
Maturity Date, in each case on terms acceptable to the Administrative Agent and
the relevant Letter of Credit Issuer.
(c) Notwithstanding the foregoing, in the event a Lender Default
exists, no Letter of Credit Issuer shall be required to issue any Letter of
Credit unless either (i) such Letter of Credit Issuer has entered into
arrangements satisfactory to it and the Borrower to eliminate such Letter of
Credit Issuer's risk with respect to the participation in Letters of Credit of
the Defaulting Lender or Lenders, including by cash collateralizing such
Defaulting Lender's or Lenders' General Revolving Facility Percentage of the
Letter of Credit Outstandings; or (ii) the issuance of such Letter of Credit,
taking into account the potential failure of the Defaulting Lender or Lenders to
risk participate therein, will not cause the Letter of Credit Issuer to incur
aggregate credit exposure hereunder with respect to Revolving Loans and Letter
of Credit Outstandings in excess of its Revolving Commitment, and the Borrower
has undertaken, for the benefit of such Letter of Credit Issuer, pursuant to an
instrument satisfactory in form and substance to such Letter of Credit Issuer,
not to thereafter incur Loans or Letter of Credit Outstandings hereunder which
would cause the Letter of Credit Issuer to incur aggregate credit exposure
hereunder with respect to Revolving Loans and Letter of Credit Outstandings in
excess of its Revolving Commitment.
(d) Annex IV hereto contains a description of all letters of credit
outstanding on, and to continue in effect after, the Closing Date. Each such
letter of credit issued by a bank that is or becomes a Lender under this
Agreement on the Effective Date (each, an "EXISTING LETTER OF CREDIT") shall
constitute a "Letter of Credit" for all purposes of this Agreement, issued, for
purposes of section 3.4(a), on the Closing Date, and the Borrower, the
Administrative Agent and the applicable Lenders hereby agree that, from and
after such date, the terms of this Agreement shall apply to such Letters of
Credit, superseding any other agreement theretofore applicable to them to the
extent inconsistent with the terms hereof.
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3.2. Letter of Credit Requests: Notices of Issuance. (a) Whenever it
desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the Letter of Credit Issuer written or telephonic
notice (in the case of telephonic notice, promptly confirmed in writing if so
requested by the Administrative Agent) which, if in the form of written notice
shall be substantially in the form of Exhibit B-4, or transmit by electronic
communication (if arrangements for doing so have been approved by the Letter of
Credit Issuer), prior to 12:00 noon (local time at its Notice Office) at least
three Business Days (or such shorter period as may be acceptable to the relevant
Letter of Credit Issuer) prior to the proposed date of issuance (which shall be
a Business Day) (each a "LETTER OF CREDIT REQUEST"), which Letter of Credit
Request shall include such supporting documents that such Letter of Credit
Issuer customarily requires in connection therewith (including, in the case of a
Letter of Credit for an account party other than the Borrower, an application
for, and if applicable a reimbursement agreement with respect to, such Letter of
Credit). Any such documents executed in connection with the issuance of a Letter
of Credit, including the Letter of Credit itself, are herein referred to as
"LETTER OF CREDIT DOCUMENTS". In the event of any inconsistency between any of
the terms or provisions of any Letter of Credit Document and the terms and
provisions of this Agreement respecting Letters of Credit, the terms and
provisions of this Agreement shall control. The Administrative Agent shall
promptly notify each Lender of each Letter of Credit Request.
(b) Each Letter of Credit Issuer shall, on the date of each issuance of
a Letter of Credit by it, give the Administrative Agent, each applicable Lender
and the Borrower written notice of the issuance of such Letter of Credit,
accompanied by a copy to the Administrative Agent of the Letter of Credit or
Letters of Credit issued by it. Each Letter of Credit Issuer shall provide to
the Administrative Agent a quarterly (or monthly if requested by any applicable
Lender) summary describing each Letter of Credit issued by such Letter of Credit
Issuer and then outstanding and an identification for the relevant period of the
daily aggregate Letter of Credit Outstandings represented by Letters of Credit
issued by such Letter of Credit Issuer.
3.3. Agreement to Repay Letter of Credit Drawings. (a) The Borrower
hereby agrees to reimburse (or cause any Letter of Credit Obligor for whose
account a Letter of Credit was issued to reimburse) each Letter of Credit
Issuer, by making payment directly to such Letter of Credit Issuer in
immediately available funds at the payment office of such Letter of Credit
Issuer, for any payment or disbursement made by such Letter of Credit Issuer
under any Letter of Credit (each such amount so paid or disbursed until
reimbursed, an "UNPAID DRAWING") immediately after, and in any event on the date
on which, such Letter of Credit Issuer notifies the Borrower (or any such other
Letter of Credit Obligor for whose account such Letter of Credit was issued) of
such payment or disbursement (which notice to the Borrower (or such other Letter
of Credit Obligor) shall be delivered reasonably promptly after any such payment
or disbursement), such payment to be made in Dollars (and in the amount which is
the Dollar equivalent of any such payment or disbursement made or denominated in
an Alternative Currency), with interest on the amount so paid or disbursed by
such Letter of Credit Issuer, to the extent not reimbursed prior to 1:00 P.M.
(local time at the payment office of the Letter of Credit Issuer) on the date of
such payment or disbursement, from and including the date paid or disbursed to
but not including the date such Letter of Credit Issuer is reimbursed therefor
at a rate per annum which shall be the rate then applicable to Revolving Loans
which are Prime Rate Loans (plus an additional 2% per annum if not reimbursed on
the date of such payment or disbursement), any such interest also to be payable
on demand.
(b) The Borrower's obligation under this section 3.3 to reimburse, or
cause another Letter of Credit Obligor to reimburse, each Letter of Credit
Issuer with respect to Unpaid Drawings (including, in each case, interest
thereon) shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment which the
Borrower or any other Letter of Credit Obligor may have or have had against such
Letter of Credit Issuer, the Administrative Agent, any other Letter of Credit
Issuer or any Lender, including, without limitation, any defense based upon the
failure of any drawing under a Letter of Credit to conform to the terms of the
Letter of Credit or any non-application or misapplication by the beneficiary of
the proceeds of such drawing, PROVIDED, HOWEVER that the Borrower shall not be
obligated to reimburse, or cause another Letter of Credit Obligor to reimburse,
a Letter of Credit Issuer for any wrongful payment made by such Letter of Credit
Issuer under a Letter of Credit as a result of acts or omissions constituting
willful misconduct or gross negligence on the part of such Letter of Credit
Issuer.
3.4. Letter of Credit Participations. (a) Immediately upon the issuance
by a Letter of Credit Issuer of any Letter of Credit (and on the Closing Date
with respect to any Existing Letter of Credit), such Letter of Credit
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Issuer shall be deemed to have sold and transferred to each Lender with a
Revolving Commitment, and each such Lender (each a "PARTICIPANT") shall be
deemed irrevocably and unconditionally to have purchased and received from such
Letter of Credit Issuer, without recourse or warranty, an undivided interest and
participation, to the extent of such Lender's General Revolving Facility
Percentage, in such Letter of Credit, each substitute letter of credit, each
drawing made thereunder, the obligations of the Borrower under this Agreement
with respect thereto (although Letter of Credit Fees shall be payable directly
to the Administrative Agent for the account of the Lenders as provided in
section 4.1(b) and the Participants shall have no right to receive any portion
of any fees of the nature contemplated by section 4.1(c)), the obligations of
any Letter of Credit Obligor under any Letter of Credit Documents pertaining
thereto, and any security for, or guaranty pertaining to, any of the foregoing.
Upon any change in the Revolving Commitments of the Lenders pursuant to section
12.4(c), it is hereby agreed that, with respect to all outstanding Letters of
Credit and Unpaid Drawings, there shall be an automatic adjustment to the
participations pursuant to this section 3.4 to reflect the new General Revolving
Facility Percentages of the assigning and assignee Lender.
(b) In determining whether to pay under any Letter of Credit, a Letter
of Credit Issuer shall not have any obligation relative to the Participants
other than to determine that any documents required to be delivered under such
Letter of Credit have been delivered and that they appear to comply on their
face with the requirements of such Letter of Credit. Any action taken or omitted
to be taken by a Letter of Credit Issuer under or in connection with any Letter
of Credit if taken or omitted in the absence of gross negligence or willful
misconduct, shall not create for such Letter of Credit Issuer any resulting
liability.
(c) In the event that a Letter of Credit Issuer makes any payment under
any Letter of Credit and the Borrower shall not have reimbursed (or caused any
applicable Letter of Credit Obligor to reimburse) such amount in full to such
Letter of Credit Issuer pursuant to section 3.3(a), such Letter of Credit Issuer
shall promptly notify the Administrative Agent, and the Administrative Agent
shall promptly notify each Participant of such failure, and each Participant
shall promptly and unconditionally pay to the Administrative Agent for the
account of such Letter of Credit Issuer, the amount of such Participant's
General Revolving Facility Percentage of such payment in U.S. Dollars (the
Administrative Agent having determined in the case of any payment by a Letter of
Credit Issuer made in an Alternative Currency the equivalent thereof in Dollars)
and in same day funds, PROVIDED, HOWEVER, that no Participant shall be obligated
to pay to the Administrative Agent its General Revolving Facility Percentage of
such unreimbursed amount for any wrongful payment made by such Letter of Credit
Issuer under a Letter of Credit as a result of acts or omissions constituting
willful misconduct or gross negligence on the part of such Letter of Credit
Issuer. If the Administrative Agent so notifies any Participant required to fund
a payment under a Letter of Credit prior to 11:00 A.M. (local time at its Notice
Office) on any Business Day, such Participant shall make available to the
Administrative Agent for the account of the relevant Letter of Credit Issuer
such Participant's General Revolving Facility Percentage of the amount of such
payment on such Business Day in same day funds. If and to the extent such
Participant shall not have so made its General Revolving Facility Percentage of
the amount of such payment available to the Administrative Agent for the account
of the relevant Letter of Credit Issuer, such Participant agrees to pay to the
Administrative Agent for the account of such Letter of Credit Issuer, forthwith
on demand such amount, together with interest thereon, for each day from such
date until the date such amount is paid to the Administrative Agent for the
account of such Letter of Credit Issuer at the Federal Funds Effective Rate. The
failure of any Participant to make available to the Administrative Agent for the
account of the relevant Letter of Credit Issuer its General Revolving Facility
Percentage of any payment under any Letter of Credit shall not relieve any other
Participant of its obligation hereunder to make available to the Administrative
Agent for the account of such Letter of Credit Issuer its General Revolving
Facility Percentage of any payment under any Letter of Credit on the date
required, as specified above, but no Participant shall be responsible for the
failure of any other Participant to make available to the Administrative Agent
for the account of such Letter of Credit Issuer such other Participant's General
Revolving Facility Percentage of any such payment.
(d) Whenever a Letter of Credit Issuer receives a payment of a
reimbursement obligation as to which the Administrative Agent has received for
the account of such Letter of Credit Issuer any payments from the Participants
pursuant to section 3.4(c) above, such Letter of Credit Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its General Revolving Facility Percentage thereof, in
U.S. dollars and in same day funds, an amount equal to such Participant's
General Revolving Facility Percentage of the principal amount thereof and
interest thereon accruing after the purchase of the respective participations,
as and to the extent so received.
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(e) The obligations of the Participants to make payments to the
Administrative Agent for the account of each Letter of Credit Issuer with
respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off defense or other
right which the Borrower (or any other Letter of Credit Obligor) may
have at any time against a beneficiary named in a Letter of Credit, any
transferee of any Letter of Credit (or any person for whom any such
transferee may be acting), the Administrative Agent, any Letter of
Credit Issuer, any Lender, or other person, whether in connection with
this Agreement, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying
transaction between the Borrower (or any other Letter of Credit
Obligor) and the beneficiary named in any such Letter of Credit), other
than any claim which the Borrower (or any other Letter of Credit
Obligor which is the account party with respect to a Letter of Credit)
may have against any applicable Letter of Credit Issuer for gross
negligence or wilful misconduct of such Letter of Credit Issuer in
making payment under any applicable Letter of Credit;
(iii) any draft, certificate or other document presented under
the Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents: or
(v) the occurrence of any Default or Event of Default.
(f) To the extent the Letter of Credit Issuer is not indemnified by the
Borrower, the Participants will reimburse and indemnify the Letter of Credit
Issuer, in proportion to their respective General Revolving Facility
Percentages, for and against any and all liabilities, obligations, losses,
damages, penalties, claims, actions, judgments, costs, expenses or disbursements
of whatsoever kind or nature which may be imposed on, asserted against or
incurred by the Letter of Credit Issuer in performing its respective duties in
any way related to or arising out of its issuance of Letters of Credit, provided
that no Participants shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, claims, actions, judgments, costs,
expenses or disbursements resulting from the Letter of Credit Issuer's gross
negligence or willful misconduct.
3.5. Increased Costs. If after the Effective Date, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Letter of Credit Issuer or any Lender with any
request or directive (whether or not having the force of law) by any such
authority, central bank or comparable agency (in each case made subsequent to
the Effective Date) shall either (i) impose, modify or make applicable any
reserve, deposit, capital adequacy or similar requirement against Letters of
Credit issued by such Letter of Credit Issuer or such Lender's participation
therein, or (ii) shall impose on such Letter of Credit Issuer or any Lender any
other conditions affecting this Agreement, any Letter of Credit or such Lender's
participation therein; and the result of any of the foregoing is to increase the
cost to such Letter of Credit Issuer or such Lender of issuing, maintaining or
participating in any Letter of Credit, or to reduce the amount of any sum
received or receivable by such Letter of Credit Issuer or such Lender hereunder
(other than any increased cost or reduction in the amount received or receivable
resulting from the imposition of or a change in the rate of taxes or similar
charges), then, upon demand to the Borrower by such Letter of Credit Issuer or
such Lender (a copy of which notice shall be sent by such Letter of Credit
Issuer or such Lender to the Administrative Agent), the Borrower shall pay to
such Letter of Credit Issuer or such Lender such additional amount or amounts as
will compensate any such Letter of Credit Issuer or such Lender for such
increased cost or reduction. A certificate submitted to the Borrower by any
Letter of Credit Issuer or any Lender, as the case may be (a copy of which
certificate shall be sent by such Letter of Credit Issuer or such Lender to the
Administrative Agent), setting forth, in reasonable detail, the basis for
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the determination of such additional amount or amounts necessary to compensate
any Letter of Credit Issuer or such Lender as aforesaid shall be conclusive and
binding on the Borrower absent manifest error, although the failure to deliver
any such certificate shall not release or diminish any of the Borrower's
obligations to pay additional amounts pursuant to this section 3.5. Reference is
hereby made to the provisions of section 2.10(d) for certain limitations upon
the rights of a Letter of Credit Issuer or Lender under this section.
3.6. Guaranty of Letter of Credit Obligations of Other Letter of Credit
Obligors. (a) The Borrower hereby unconditionally guarantees, for the benefit of
the Administrative Agent and the Lenders, the full and punctual payment of the
Obligations of each Other Letter of Credit Obligor under each Letter of Credit
Document to which such Other Letter of Credit Obligor is now or hereafter
becomes a party. Upon failure by any such Other Letter of Credit Obligor to pay
punctually any such amount, the Borrower shall forthwith on demand by the
Administrative Agent pay the amount not so paid at the place and in the currency
and otherwise in the manner specified in this Agreement or any applicable Letter
of Credit Document.
(b) As a separate, additional and continuing obligation, the Borrower
unconditionally and irrevocably undertakes and agrees, for the benefit of the
Administrative Agent and the Lenders, that, should any amounts not be
recoverable from the Borrower under section 3.6(a) for any reason whatsoever
(including, without limitation, by reason of any provision of any Credit
Document or any other agreement or instrument executed in connection therewith
being or becoming void, unenforceable, or otherwise invalid under any applicable
law) then, notwithstanding any notice or knowledge thereof by any Lender, the
Administrative Agent, any of their respective Affiliates, or any other person,
at any time, the Borrower as sole, original and independent obligor, upon demand
by the Administrative Agent, will make payment to the Administrative Agent, for
the account of the Lenders and the Administrative Agent, of all such obligations
not so recoverable by way of full indemnity, in such currency and otherwise in
such manner as is provided in the Credit Documents.
(c) The obligations of the Borrower under this section shall be
unconditional and absolute and, without limiting the generality of the foregoing
shall not be released, discharged or otherwise affected by the occurrence, one
or more times, of any of the following:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect to any obligation of any Other Letter of Credit
Obligor under any Letter of Credit Document, by operation of law or
otherwise;
(ii) any modification or amendment of or supplement to this
Agreement, any Note or any other Credit Document;
(iii) any release, non-perfection or invalidity of any direct
or indirect security for any obligation of the Borrower under this
Agreement, any Note or any other Credit Document or of any Other Letter
of Credit Obligor under any Letter of Credit Document;
(iv) any change in the corporate existence, structure or
ownership of any Other Letter of Credit Obligor or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting any
Other Letter of Credit Obligor or its assets or any resulting release
or discharge of any obligation of any Other Letter of Credit Obligor
contained in any Letter of Credit Document;
(v) the existence of any claim, set-off or other rights which
the Borrower may have at any time against any Other Letter of Credit
Obligor, the Administrative Agent, any Lender or any other person,
whether in connection herewith or any unrelated transactions;
(vi) any invalidity or unenforceability relating to or against
any Other Letter of Credit Obligor for any reason of any Letter of
Credit Document, or any provision of applicable law or regulation
purporting to prohibit the payment by any Other Letter of Credit
Obligor of any Obligations in respect of any Letter of Credit; or
(vii) any other act or omission to act or delay of any kind by
any Other Letter of Credit Obligor, the Administrative Agent, any
Lender or any other person or any other circumstance whatsoever which
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might, but for the provisions of this section, constitute a legal or
equitable discharge of the Borrower's obligations under this section.
(d) The Borrower's obligations under this section shall remain in full
force and effect until the Commitments shall have terminated and the principal
of and interest on the Notes and all other amounts payable by the Borrower under
the Credit Documents and by any Other Letter of Credit Obligor under the Letter
of Credit Documents shall have been paid in full. If at any time any payment of
any of the Obligations of any Other Letter of Credit Obligor in respect of any
Letter of Credit Documents is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of such Other Letter
of Credit Obligor, the Borrower's obligations under this section with respect to
such payment shall be reinstated at such time as though such payment had been
due but not made at such time.
(e) The Borrower irrevocably waives acceptance hereof, presentment,
demand, protest and any notice not provided for herein, as well as any
requirement that at any time any action be taken by any person against any Other
Letter of Credit Obligor or any other person, or against any collateral or
guaranty of any other person.
(f) Until the indefeasible payment in full of all of the Obligations
and the termination of the Commitments of the Lenders hereunder, the Borrower
shall have no rights, by operation of law or otherwise, upon making any payment
under this section to be subrogated to the rights of the payee against any Other
Letter of Credit Obligor with respect to such payment or otherwise to be
reimbursed, indemnified or exonerated by any Other Letter of Credit Obligor in
respect thereof.
(g) In the event that acceleration of the time for payment of any
amount payable by any Other Letter of Credit Obligor under any Letter of Credit
Document is stayed upon insolvency, bankruptcy or reorganization of such Other
Letter of Credit Obligor, all such amounts otherwise subject to acceleration
under the terms of any applicable Letter of Credit Document shall nonetheless be
payable by the Borrower under this section forthwith on demand by the
Administrative Agent.
SECTION 4. FEES; COMMITMENTS.
4.1. Fees. (a) Facility Fees. (i) The Borrower agrees to pay to the
Administrative Agent a Facility Fee ("FACILITY FEE") for the account of each
Non-Defaulting Lender which has a General Revolving Commitment, for the period
from and including the Effective Date to but not including the date the Total
General Revolving Commitment has been terminated and no General Revolving Loans
or Letters of Credit are outstanding. In the case of any such Lender, the
portion of the Facility Fee to which it shall be entitled shall be computed for
each day at a rate per annum equal to the Applicable Facility Fee Rate for such
day, on the amount of its General Revolving Facility Percentage of the Total
General Revolving Commitment on such day, whether used or unused. Accrued
Facility Fees shall be payable in arrears on the first Business Day of each
April, July, October and January and on the date when the Total General
Revolving Commitment has been terminated and no General Revolving Loans or
Letters of Credit are outstanding.
(ii) As used herein the term "APPLICABLE FACILITY FEE RATE" shall mean
the particular rate per annum determined by the Administrative Agent in
accordance with the Pricing Grid Table which appears in section 2.7(h), based
upon the ratings by Moody's and S&P, respectively, applicable on any date to the
Index Debt, and the following provisions:
(A) Initially, until changed hereunder in accordance with the
following provisions, the Applicable Facility Fee Rate will be 12.50
basis points per annum.
(B) Effective on the effective date of any change in the
Applicable LIBOR Margin pursuant to section 2.7(h)(iii), the Applicable
Facility Fee Rate shall change on the same date to the Applicable
Facility Fee Rate which corresponds to the changed Applicable LIBOR
Margin, as indicated in the Pricing Grid Table which appears in section
2.7(h) hereof.
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(C) Notwithstanding the above provisions, during any period
when a Default under section 10.1(a) or an Event of Default has
occurred and is continuing, the Applicable Facility Fee Rate shall be
the highest rate per annum indicated therefor in the Pricing Grid
Table, regardless of the then ratings on the Index Debt.
(D) Any changes in the Applicable Facility Fee Rate shall be
determined by the Administrative Agent in accordance with the above
provisions and the Administrative Agent will promptly provide notice of
such determinations to the Borrower and the Lenders. Any such
determination by the Administrative Agent pursuant to this section
4.1(a)(ii) shall be conclusive and binding absent manifest error.
(b) Letter of Credit Fees. The Borrower agrees to pay to the
Administrative Agent, for the account of each Non-Defaulting Lender, pro rata on
the basis of its Percentage, a fee in respect of each Letter of Credit (the
"LETTER OF CREDIT FEE"), computed for each day at the rate per annum equal to
the Applicable LIBOR Margin then in effect on the Stated Amount of all Letters
of Credit outstanding on such day. Accrued Letter of Credit Fees shall be due
and payable quarterly in arrears on the first Business Day of each April, July,
October and January and on the date when the Total Commitment expires or is
terminated and no Letters of Credit remain outstanding. The Borrower also agrees
to pay to the Administrative Agent, for the account of each Non-Defaulting
Lender, PRO RATA on the basis of its Percentage, additional Letter of Credit
Fees, on demand, at the rate of 200 basis points per annum, on the Stated Amount
of each Letter of Credit, for any period when a Default under section 10.1(a) or
Event of Default is in existence.
(c) Facing Fees. The Borrower to pay directly to each Letter of Credit
Issuer a fee in respect of each Letter of Credit issued by it (a "Facing Fee"),
computed for each day at the rate of 1/8 of 1% per annum on the Stated Amount of
such Letter of Credit issued by such Letter of Credit Issuer which is
outstanding on such day. Accrued Facing Fees shall be due and payable quarterly
in arrears on the first Business Day of each April, July, October and January
and on the date on which the Total Commitment expires or is terminated and no
Letters of Credit remain outstanding.
(d) Additional Charges of Letter of Credit Issuer. The Borrower agrees
to pay directly to each Letter of Credit Issuer upon each issuance of, drawing
under, and/or amendment, extension, renewal or transfer of, a Letter of Credit
issued by it such amount as shall at the time of such issuance, drawing,
amendment, extension, renewal or transfer be the administrative or processing
charge which such Letter of Credit Issuer is customarily charging for issuances
of, drawings under or amendments, extensions, renewals or transfers of, letters
of credit issued by it.
(e) Other Fees. The Borrower shall pay to the Administrative Agent
and/or the Lead Arranger, on the Effective Date and thereafter, for its or their
own account and/or for distribution to the Lenders, such fees as heretofore
agreed in writing by the Borrower, the Lead Arranger and the Administrative
Agent.
(f) Computations of Fees. All computations of Fees shall be made in
accordance with section 12.7(b).
4.2. Voluntary Termination/Reduction of Commitments. Upon at least
three Business Days' prior written notice (or telephonic notice confirmed in
writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Lenders), the
Borrower shall have the right to:
(a) Termination of Total Commitment: terminate the Total
Commitment, PROVIDED that (i) all outstanding Revolving Loans are
contemporaneously prepaid in accordance with section 5.1 and all
outstanding Competitive Bid Loans are contemporaneously prepaid in
accordance with section 2.3(d), and (ii) either (A) no Letters of
Credit remain outstanding, or (B) the Borrower shall contemporaneously
either (x) cause all outstanding Letters of Credit to be surrendered
for cancellation (any such Letters of Credit to be replaced by letters
of credit issued by other financial institutions acceptable to each
Letter of Credit Issuer and the Required Lenders), or (y) the Borrower
shall pay to the Administrative Agent an amount in cash and/or Cash
Equivalents equal to 100% of the Letter of Credit Outstandings and the
Administrative Agent shall hold such payment as security for the
reimbursement obligations of the Borrower and any other Letter of
Credit Obligor in respect of Letters of Credit pursuant to a cash
collateral agreement to be entered into in form and substance
reasonably satisfactory to the Administrative Agent, each Letter of
Credit Issuer and the
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Borrower (which shall permit certain investments in Cash Equivalents
satisfactory to the Administrative Agent, each Letter of Credit Issuer
and the Borrower until the proceeds are applied to the secured
obligations);
(b) Partial Reductions of Unutilized Total General Revolving
Commitment: partially and permanently reduce the Unutilized Total
General Revolving Commitment, PROVIDED that (i) any such reduction
shall apply to proportionately and permanently reduce the General
Revolving Commitment of each of the Lenders; (ii) any partial reduction
of the Unutilized Total General Revolving Commitment pursuant to this
section 4.2(b) shall be in the amount of at least $5,000,000 (or, if
greater, in integral multiples of $1,000,000); and (iii) after giving
effect to any partial reduction of the Unutilized Total General
Revolving Commitment pursuant to this section 4.2(b), the Unutilized
Total General Revolving Commitment shall exceed the Swing Line
Revolving Commitment then in effect by at least $20,000,000; and/or
(c) Partial Reductions of Unutilized Swing Line Revolving
Commitment: partially and permanently reduce the Unutilized Swing Line
Revolving Commitment, provided that any partial reduction of the
Unutilized Swing Line Revolving Commitment pursuant to this section
4.2(c) shall be in the amount of at least $1,000,000 (or, if greater,
in integral multiples of $1,000,000).
4.3. Mandatory Adjustments of Commitments, etc. (a) The Total
Commitment (and the Commitment of each Lender) shall terminate on May 15, 2000,
unless the Closing Date has occurred on or prior to such date.
(b) The Total Commitment shall terminate (and the Commitment of each
Lender shall terminate) on the earlier of (x) the Maturity Date and (y) the date
on which a Change of Control occurs.
4.4. EXTENSION OF MATURITY DATE. At any time after January 1, 2001 and
during the 30 day period following delivery by the Borrower pursuant to section
8.1(a) of its consolidated financial statements for its fiscal year then most
recently ended, and annually thereafter during the 30 day period following
delivery by the Borrower of its consolidated financial statements pursuant to
section 8.1(a), the Borrower may request the Administrative Agent to determine
if all of the Lenders are then willing to extend the Maturity Date for a single
additional year. If the Borrower so requests, the Administrative Agent will so
advise the Lenders. If all of the Lenders in their sole discretion are all
willing to so extend the Maturity Date, after taking into account such
considerations as any Lender may deem relevant, the Borrower, the Administrative
Agent and all of the Lenders (including each Letter of Credit Issuer) shall
execute and deliver a definitive written instrument so extending the Maturity
Date. No such extension of the Maturity Date shall be valid or effective for any
purpose unless such definitive written instrument is so signed and delivered
within 60 days following the giving by the Administrative Agent of notice to the
Lenders that the Borrower has requested such an extension.
SECTION 5. PAYMENTS.
5.1. Voluntary Prepayments of Loans. The Borrower may not voluntarily
prepay any Competitive Bid Loan, in whole or in part, unless such prepayment is
permitted and made as contemplated by section 2.3(d). The Borrower shall have
the right to prepay any of its General Revolving Loans or Swing Line Revolving
Loans, in whole or in part, without premium or penalty, from time to time on the
following terms and conditions:
(a) Notices: the Borrower shall give the Administrative Agent
at the Notice Office written or telephonic notice (in the case of
telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) of its intent to prepay the Loans, the amount of
such prepayment and (in the case of LIBOR Loans) the specific
Borrowing(s) pursuant to which made, which notice shall be received by
the Administrative Agent by
(i) 12:00 noon (local time at the Notice Office)
three Business Days prior to the date of such prepayment, in
the case of any prepayment of LIBOR Loans, or
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(ii) 12:00 noon (local time at the Notice Office) on
the date of such prepayment, in the case of any prepayment of
Prime Rate Loans,
and which notice shall promptly be transmitted by the Administrative
Agent to each of the affected Lenders;
(b) Partial Prepayments under the General Revolving
Facility: in the case any partial prepayment of any Borrowing under the
General Revolving Facility, such partial prepayment shall be in an
aggregate principal of at least $1,000,000 or an integral multiple of
$100,000 in excess thereof, in the case of any Borrowing comprised of
Prime Rate Loans, and at least $5,000,000 or an integral multiple of
$1,000,000 in excess thereof, in the case of any Borrowing comprised of
LIBOR Loans;
(c) Partial Prepayments under the Swing Line Revolving
Facility: in the case any partial prepayment of any Borrowing under the
Swing Line Revolving Facility, such partial prepayment shall be in an
aggregate principal of at least $500,000 or an integral multiple of
$100,000 in excess thereof;
(d) Minimum Borrowing Amount Remaining After Partial
Prepayments: no partial prepayment of any Loans made pursuant to a
Borrowing shall reduce the aggregate principal amount of such Loans
outstanding pursuant to such Borrowing to an amount less than the
Minimum Borrowing Amount applicable thereto;
(e) Prepayments to be Applied Pro Rata: each prepayment in
respect of any Loans made pursuant to a Borrowing shall be applied pro
rata among such Loans; and
(f) Breakage Compensation: each prepayment of LIBOR Loans or
Money Market Rate Loans pursuant to this section 5.1 on any date other
than the last day of the Interest Period applicable thereto, in the
case of a LIBOR Loan, or the maturity date thereof, in the case of a
Money Market Rate Loan, as applicable, shall be accompanied by any
amounts payable in respect thereof under section 2.10.
5.2. Mandatory Prepayments. The Loans shall be subject to mandatory
prepayment in accordance with the following provisions:
(a) If Outstanding General Revolving Loans, Swing Line
Revolving Loans and Letter of Credit Outstandings Exceed Total General
Revolving Commitment. If on any date (after giving effect to any other
payments on such date) the sum of (i) the aggregate outstanding
principal amount of General Revolving Loans and Swing Line Revolving
Loans, plus (ii) the aggregate amount of Letter of Credit Outstandings,
exceeds the Total General Revolving Commitment as then in effect, then
the Borrower shall prepay on such date that principal amount of General
Revolving Loans and, after General Revolving Loans have been paid in
full, Swing Line Revolving Loans, and after Swing Line Revolving Loans
have been paid in full, Unpaid Drawings, in an aggregate amount at
least equal to such excess and conforming in the case of partial
prepayments of any Loans to the applicable requirements as to the
amounts of partial prepayments which are contained in section 5.1. If,
after giving effect to the prepayment of General Revolving Loans, Swing
Line Revolving Loans and Unpaid Drawings, the aggregate amount of
Letter of Credit Outstandings exceeds the Total General Revolving
Commitment as then in effect, the Borrower shall pay to the
Administrative Agent an amount in cash and/or Cash Equivalents equal to
such excess and the Administrative Agent shall hold such payment as
security for the reimbursement obligations of the Borrower and the
other Letter of Credit Obligors in respect of Letters of Credit
pursuant to a cash collateral agreement to be entered into in form and
substance reasonably satisfactory to the Administrative Agent and the
Borrower (which shall permit certain investments in Cash Equivalents
satisfactory to the Administrative Agent and the Borrower until the
proceeds are applied to the secured obligations).
(b) If Outstanding Swing Line Revolving Loans Exceed
Unutilized Total General Revolving Commitment Amount. If on any date
(after giving effect to any other payments on such date) the aggregate
outstanding principal amount of Swing Line Revolving Loans exceeds the
Unutilized Total General Revolving Commitment as then in effect, then
the Borrower shall prepay on such date Swing Line Revolving Loans in an
aggregate amount at least equal to such excess and conforming in the
case of partial prepayments of Swing
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Line Revolving Loans to the requirements as to the amounts of partial
prepayments of Swing Line Revolving Loans which are contained in
section 5.1.
(c) If Outstanding Swing Line Revolving Loans Exceed Swing
Line Revolving Commitment. If on any date (after giving effect to any
other payments on such date) the aggregate outstanding principal amount
of Swing Line Revolving Loans exceeds the Swing Line Revolving
Commitment at such time, THEN the Borrower shall prepay on such date
Swing Line Revolving Loans in an aggregate amount at least equal to
such excess and conforming in the case of partial prepayments of Swing
Line Revolving Loans to the requirements as to the amounts of partial
prepayments of Swing Line Revolving Loans which are contained in
section 5.1.
(d) Mandatory Prepayment---Change of Control. On the date of
which a Change of Control occurs, notwithstanding anything to the
contrary contained in this Agreement, no further Borrowings shall be
made and the then outstanding principal amount of all Loans, if any,
and other Obligations, shall become due and payable and shall be
prepaid in full, together with accrued interest and Fees, and the
Borrower shall contemporaneously either (i) cause all outstanding
Letters of Credit to be surrendered for cancellation (any such Letters
of Credit to be replaced by letters of credit issued by other financial
institutions acceptable to the Required Lenders), or (ii) the Borrower
shall pay to the Administrative Agent an amount in cash and/or Cash
Equivalents equal to 100% of the Letter of Credit Outstandings and the
Administrative Agent shall hold such payment as security for the
reimbursement obligations of the Borrower and the other Letter of
Credit Obligors in respect of Letters of Credit pursuant to a cash
collateral agreement to be entered into in form and substance
reasonably satisfactory to the Administrative Agent, each Letter of
Credit Issuer and the Borrower (which shall permit certain investments
in Cash Equivalents satisfactory to the Administrative Agent, each
Letter of Credit Issuer and the Borrower until the proceeds are applied
to the secured obligations).
(e) Particular Loans to be Prepaid. With respect to each
repayment or prepayment of Loans required by this section 5.2, the
Borrower shall designate the Types of Loans which are to be repaid or
prepaid and the specific Borrowing(s) pursuant to which such repayment
or prepayment is to be made, provided that (i) the Borrower shall first
so designate all Loans that are Prime Rate Loans and LIBOR Loans with
Interest Periods ending on the date of repayment or prepayment prior to
designating any other LIBOR Loans for repayment or prepayment, (ii) if
the outstanding principal amount of LIBOR Loans made pursuant to a
Borrowing is reduced below the applicable Minimum Borrowing Amount as a
result of any such repayment or prepayment, then all the Loans
outstanding pursuant to such Borrowing shall be converted into Prime
Rate Loans, and (iii) each repayment and prepayment of any Loans made
pursuant to a Borrowing shall be applied pro rata among such Loans. In
the absence of a designation by the Borrower as described in the
preceding sentence, the Administrative Agent shall, subject to the
above, make such designation in its sole discretion with a view, but no
obligation, to minimize breakage costs owing under section 2.10. Any
repayment or prepayment of LIBOR Loans pursuant to this section 5.2
shall in all events be accompanied by such compensation as is required
by section 2.10.
5.3. Method and Place of Payment. (a) Except as otherwise specifically
provided herein, all payments under this Agreement shall be made to the
Administrative Agent for the ratable (based on its PRO RATA share) account of
the Lenders entitled thereto, not later than 12:00 noon (local time at the
Payment Office) on the date when due and shall be made at the Payment Office in
immediately available funds and in lawful money of the United States of America,
it being understood that written notice by the Borrower to the Administrative
Agent to make a payment from the funds in the Borrower's account at the Payment
Office shall constitute the making of such payment to the extent of such funds
held in such account. Any payments under this Agreement which are made later
than 12:00 noon (local time at the Payment Office) shall be deemed to have been
made on the next succeeding Business Day. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, the
due date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate in effect immediately prior to such extension.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, Unpaid Drawings,
interest and Fees then due hereunder and an Event of Default is not then in
existence, such funds shall be applied (i) first, towards payment of interest
and Fees then due hereunder, ratably
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among the parties entitled thereto in accordance with the amounts of interest
and Fees then due to such parties, and (ii) second, towards payment of principal
and Unpaid Drawings then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of principal and Unpaid Drawings then due
to such parties.
5.4. Net Payments. (a) All payments made by the Borrower hereunder,
under any Note or any other Credit Document, will be made without setoff,
counterclaim or other defense. Except as otherwise provided for in section
5.4(c), all such payments will be made free and clear of, and without deduction
or withholding for, any present or future United States withholding taxes. The
Borrower will furnish to the Administrative Agent within 45 days after the date
of any withholding or deduction on account of United States withholding taxes
certified copies of tax receipts, or other evidence satisfactory to the Lender,
evidencing payment thereof by the Borrower.
(b) Each Lender that is not a United States person (as such term is
defined in section 7701(a)(30) of the Code) for Federal income tax purposes
agrees to provide to the Borrower and the Administrative Agent on or prior to
the Effective Date, or in the cases of a Lender that is an assignee or
transferee of an interest under this Agreement pursuant to section 12.4 (unless
the respective Lender was already a Lender hereunder immediately prior to such
assignment or transfer and such Lender is in compliance with the provisions of
this section 5.4(b)), on the date of such assignment or transfer to such Lender,
(i) two accurate and complete original signed copies of Internal Revenue Service
Form 4224 or 1001 (or successor forms) certifying to such Lender's entitlement
to a complete exemption from United States withholding tax with respect to
payments to be made under this Agreement, any Note or any other Credit Document,
or (ii) if the Lender is not a "bank" within the meaning of section 881(c)(3)(A)
of the Code and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit G (any such certificate, a "SECTION 5.4(b)(ii) CERTIFICATE") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Lender's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement, any Note or any other Credit Document.
In addition, each Lender agrees that from time to time after the Effective Date,
when a lapse in time or change in circumstances renders the previous
certification obsolete or inaccurate in any material respect, it will deliver to
the Borrower and the Administrative Agent two new accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001, or Form W-8 and a
Section 5.4(b)(ii) Certificate, as the case may be, and such other forms as may
be required in order to confirm or establish the entitlement of such Lender to a
continued exemption from or reduction in United States withholding tax with
respect to payments under this Agreement, any Note or any other Credit Document,
or it shall immediately notify the Borrower and the Administrative Agent of its
inability to deliver any such Form or Certificate, in which case such Lender
shall not be required to deliver any such Form or Certificate pursuant to this
section 5.4(b).
(c) Notwithstanding anything to the contrary contained in section
5.4(a), the Borrower shall be entitled, to the extent it is required to do so by
law, to deduct or withhold income or other similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, fees or other amounts payable hereunder for the account of any
Lender which is not a United States person (as such term is defined in section
7701(a)(30) of the Code) for United States federal income tax purposes and which
has not provided to the Borrower such forms that establish a complete exemption
from such deduction or withholding (i) if such Lender has not provided to the
Borrower the Internal Revenue Service forms required to be provided to the
Borrower pursuant to section 5.4(b), or (ii) in the case of a payment other than
interest, to a Lender described in clause (ii) of section 5.2(b) above, to the
extent that such forms do not establish a complete exemption from withholding of
such taxes.
SECTION 6. CONDITIONS PRECEDENT.
6.1. Conditions Precedent at Closing Date. The obligation of the
Lenders to make Loans, and of any Letter of Credit Issuer to issue Letters of
Credit, is subject to the satisfaction of each of the following conditions on
the Closing Date:
(a) Effectiveness; Notes. On or prior to the Closing Date, (i)
the Effective Date shall have occurred and (ii) there shall have been
delivered to the Administrative Agent for the account of each Lender
each appropriate Note executed by the Borrower, in each case, in the
amount, maturity and as otherwise provided herein.
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(b) Fees, etc. The Borrower shall have paid or caused to be
paid all fees required to be paid by it on or prior to such date
pursuant to section 4.1 hereof and all reasonable fees and expenses of
the Administrative Agent and of special counsel to the Administrative
Agent which have been invoiced on or prior to such date in connection
with the preparation, execution and delivery of this Agreement and the
other Credit Documents and the consummation of the transactions
contemplated hereby and thereby.
(c) Charter and Good Standing of the Borrower. The
Administrative Agent shall have received, in sufficient quantity for
the Administrative Agent and the Lenders, (1) a copy of the articles of
incorporation of the Borrower, including any amendments or restatements
thereof, certified as of a recent date by the Secretary of State of
Ohio, and (2) a copy of a certificate of good standing for the
Borrower, issued as of a recent date by the Secretary of State of Ohio.
(d) Corporate Secretary's Certificate of the Borrower. The
Administrative Agent shall have received, in sufficient quantity for
the Administrative Agent and the Lenders, a certificate of the
Secretary or an Assistant Secretary of the Borrower, dated the Closing
Date, certifying (1) a true and correct copy of resolutions of the
Board of Directors of the Borrower, approving the Credit Documents to
which the Borrower is or may become a party, and certifying that such
resolutions were duly adopted and are in full force and effect, (2) a
true and correct copy of the Code of Regulations of the Borrower, and
(3) the names and true signatures of the officers of the Borrower who
are authorized to sign the Credit Documents to which the Borrower is a
party and any other documents to which the Borrower is a party which
may be executed and delivered in connection herewith.
(e) Compliance Certificate of the Borrower. The Administrative
Agent shall have received, in sufficient quantity for the
Administrative Agent and the Lenders, a Compliance Certificate, dated
the Closing Date, duly executed on behalf of the Borrower, to the
effect that (1) no Default or Event of Default is in existence, (2) all
agreements, covenants and conditions required to be performed or
complied with by the Borrower or any of the other Credit Parties under
this Agreement or any of the other Credit Documents on or prior to the
Closing Date have duly performed or complied with prior to or at the
Closing Date, and (3) all representations and warranties of the
Borrower contained in this Agreement are true and correct in all
material respects on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of
the Closing Date, except for any such representations and warranties
which expressly relate to an earlier specified date, in which case such
representations and warranties are reaffirmed as true and correct in
all material respects as of the date when made.
(f) Opinion of Counsel. On the Closing Date, the
Administrative Agent shall have received an opinion, addressed to the
Administrative Agent and each of the Lenders and dated the Closing
Date, from Squire, Sanders & Dempsey L.L.P., special counsel to the
Borrower, substantially in the form of Exhibit D hereto and covering
such other matters incident to the transactions contemplated hereby as
the Administrative Agent may reasonably request, such opinion to be in
form and substance satisfactory to the Administrative Agent.
(g) Existing Credit Facility. Contemporaneously with the
Closing Date, the Borrower shall have terminated the commitments of the
lenders under its Credit Agreement, dated as of August 22, 1990, as
amended and prepaid any borrowings thereunder.
(h) Proceedings and Documents. All corporate and other
proceedings and all documents incidental to the transactions
contemplated hereby shall be satisfactory in substance and form to the
Administrative Agent and the Lenders and the Administrative Agent and
its special counsel and the Lenders shall have received all such
counterpart originals or certified or other copies of such documents as
the Administrative Agent or its special counsel or any Lender may
reasonably request.
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6.2. Conditions Precedent to All Credit Events (Other than any
Competitive Bid Borrowing). The obligations of the Lenders to make each
Revolving Loan and/or of a Letter of Credit Issuer to issue each Letter of
Credit is subject, at the time thereof, to the satisfaction of the following
conditions:
(a) Notice of Revolving Borrowing, etc. The Administrative
Agent shall have received a Notice of Revolving Borrowing meeting the
requirements of section 2.2 with respect to the incurrence of Loans or
a Letter of Credit Request meeting the requirement of section 3.2 with
respect to the issuance of a Letter of Credit.
(b) No Default; Representations and Warranties. At the time of
each such Credit Event and also after giving effect thereto, (i) there
shall exist no Default or Event of Default and (ii) all representations
and warranties of the Credit Parties contained herein or in the other
Credit Documents shall be true and correct in all material respects
with the same effect as though such representations and warranties had
been made on and as of the date of such Credit Event, except to the
extent that such representations and warranties expressly relate to an
earlier specified date, in which case such representations and
warranties shall have been true and correct in all material respects as
of the date when made.
The acceptance of the benefits of each such Credit Event shall constitute a
representation and warranty by the Borrower to each of the Lenders that all of
the applicable conditions specified in section 6.1 and/or 6.2, as the case may
be, have been satisfied as of the times referred to in sections 6.1 and 6.2. All
of the certificates, legal opinions and other documents and papers referred to
in this section 6, unless otherwise specified, shall be delivered to the
Administrative Agent for the account of each of the Administrative Agent and the
Lenders and, except for the Notes, in sufficient counterparts for the
Administrative Agent and the Lenders, and the Administrative Agent will promptly
distribute to the Lenders their respective Notes and the copies of such other
certificates, legal opinions and documents.
6.3. Conditions Precedent to Each Competitive Bid Borrowing. The
obligation of each Lender which is to make a Competitive Bid Loan on the
occasion of a Competitive Bid Borrowing (including the initial Competitive Bid
Borrowing) to make such Competitive Bid Loan as part of such Competitive Bid
Borrowing is subject to satisfaction of each of the following conditions;
(a) Notice of Competitive Bid Borrowing. The Administrative
Agent shall have received the written confirmatory Notice of
Competitive Bid Borrowing with respect thereto.
(b) Competitive Bid Note. Prior to the time such Competitive
Bid Borrowing is to be made by any applicable Lender, the
Administrative Agent shall have received a Competitive Bid Note payable
to the order of such Lender.
(c) No Default; Representations and Warranties. At the time
thereof and also after giving effect thereto, (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
of the Credit Parties contained herein or in the other Credit Documents
shall be true and correct in all material respects with the same effect
as though such representations and warranties had been made on and as
of the date of such Credit Event, except to the extent that such
representations and warranties expressly relate to an earlier specified
date, in which case such representations and warranties shall have been
true and correct in all material respects as of the date when made.
The acceptance of the benefits of each Competitive Bid Loan shall constitute a
representation and warranty by the Borrower to each of the Lenders that all of
the applicable conditions specified in this section 6.3 exist as of that time.
The Administrative Agent will promptly distribute to the Lenders participating
in such Competitive Bid Borrowing their respective Competitive Bid Notes (to the
extent not previously delivered).
SECTION 7. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Agreement and to make
the Loans, and/or to issue and/or to participate in the Letters of Credit
provided for herein, the Borrower makes the following representations and
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warranties to, and agreements with, the Lenders, all of which shall survive the
execution and delivery of this Agreement and each Credit Event:
7.1. Corporate Status, etc. Each of the Borrower and its Subsidiaries
(i) is a duly organized or formed and validly existing corporation, partnership
or limited liability company, as the case may be, in good standing under the
laws of the jurisdiction of its formation and has the corporate, partnership or
limited liability company power and authority, as applicable, to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage, and (ii) has duly qualified and is authorized to
do business in all jurisdictions where it is required to be so qualified except
where the failure to be so qualified would not have a Material Adverse Effect.
7.2. Subsidiaries. Annex II hereto lists, as of the date hereof, each
Subsidiary of the Borrower (and the direct and indirect ownership interest of
the Borrower therein).
7.3. Corporate Power and Authority, etc. Each Credit Party has the
corporate or other organizational power and authority to execute, deliver and
carry out the terms and provisions of the Credit Documents to which it is party
and has taken all necessary corporate or other organizational action to
authorize the execution, delivery and performance of the Credit Documents to
which it is party. Each Credit Party has duly executed and delivered each Credit
Document to which it is party and each Credit Document to which it is party
constitutes the legal, valid and binding agreement or obligation of such Credit
Party enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).
7.4. No Violation. Neither the execution, delivery and performance by
any Credit Party of the Credit Documents to which it is party nor compliance
with the terms and provisions thereof (i) will contravene any provision of any
law, statute, rule, regulation, order, writ, injunction or decree of any court
or governmental instrumentality applicable to such Credit Party or its
properties and assets, (ii) will conflict with or result in any breach of, any
of the terms, covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien upon any of the property or assets of such Credit Party
pursuant to the terms of any promissory note, bond, debenture, indenture,
mortgage, deed of trust, credit or loan agreement, or any other material
agreement or other instrument, to which such Credit Party is a party or by which
it or any of its property or assets are bound or to which it may be subject, or
(iii) will violate any provision of the certificate or articles of
incorporation, code of regulations or by-laws, or other charter documents of
such Credit Party.
7.5. Governmental Approvals. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required as a
condition to (i) the execution, delivery and performance by any Credit Party of
any Credit Document to which it is a party, or (ii) the legality, validity,
binding effect or enforceability of any Credit Document to which any Credit
Party is a party.
7.6. Litigation. There are no actions, suits or proceedings pending or,
to, the knowledge of the Borrower, threatened with respect to the Borrower or
any of its Subsidiaries (i) that have, or could reasonably be expected to have,
a Material Adverse Effect, or (ii) which question the validity or enforceability
of any of the Credit Documents, or of any action to be taken by the Borrower or
any of the other Credit Parties pursuant to any of the Credit Documents.
7.7. Use of Proceeds; Margin Regulations. (a) The proceeds of all Loans
and Credit Events shall be utilized for lawful purposes not inconsistent with
the requirements of this Agreement.
(b) No part of the proceeds of any Credit Event will be used directly
or indirectly to purchase or carry Margin Stock, or to extend credit to others
for the purpose of purchasing or carrying any Margin Stock, in violation of any
of the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System. The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. At no time
would more than 25% of the value of the assets of the Borrower or of the
Borrower and its consolidated Subsidiaries that are subject to any "arrangement"
(as such term is used in section 221.2(g) of such Regulation U) hereunder be
represented by Margin Stock.
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7.8. Financial Statements, etc. (a) The Borrower has furnished to the
Lenders and the Administrative Agent complete and correct copies of the audited
consolidated balance sheets of the Borrower and its consolidated subsidiaries as
of December 31, 1999 and December 31, 1998 and the related audited consolidated
statements of income, shareholders' equity, and cash flows of the Borrower and
its consolidated subsidiaries for the fiscal years then ended, accompanied by
the report thereon of KPMG LLP. All such financial statements have been prepared
in accordance with GAAP, consistently applied (except as stated therein), and
fairly present the financial position of the Borrower and its consolidated
subsidiaries as of the respective dates indicated and the consolidated results
of their operations and cash flows for the respective periods indicated.
(b) The Borrower has received consideration which is the reasonable
equivalent value of the obligations and liabilities that the Borrower has
incurred to the Administrative Agent and the Lenders. The Borrower now has
capital sufficient to carry on its business and transactions and all business
and transactions in which it is about to engage and is now solvent and able to
pay its debts as they mature and the Borrower, as of the Closing Date, owns
property having a value, both at fair valuation and at present fair salable
value, greater than the amount required to pay the Borrower's debts; and the
Borrower is not entering into the Credit Documents with the intent to hinder,
delay or defraud its creditors. For purposes of this section 7.8(b), "debt"
means any liability on a claim, and "claim" means (x) right to payment whether
or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured; or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(c) The Borrower has delivered or caused to be delivered to the Lenders
prior to the execution and delivery of this Agreement (i) a copy of the
Borrower's Report on Form 10-K as filed (without Exhibits) with the SEC for its
fiscal year ended December 31, 1999, which contains a general description of the
business and affairs of the Borrower and its Subsidiaries, (ii) a confidential
information brochure dated March 2000 prepared by the Administrative Agent (with
assistance from the Borrower) which contains information with respect to the
business, properties and operations of the Borrower and its Subsidiaries (the
"CONFIDENTIAL INFORMATION MEMORANDUM").
7.9. No Material Adverse Change. Since December 31, 1999, there has
been no change in the business, operations, liabilities or condition (financial
or other) of the Borrower and its Subsidiaries taken as a whole, or their
properties and assets considered as an entirety, EXCEPT FOR any changes none of
which, individually or in the aggregate, has had or could reasonably be expected
to have, a Material Adverse Effect.
7.10. Tax Returns and Payments. Each of the Borrower and each of its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, other than
those not yet delinquent and except for those contested in good faith. The
Borrower and each of its Subsidiaries has established on its books such charges,
accruals and reserves in respect of taxes, assessments, fees and other
governmental charges for all fiscal periods as are required by GAAP. The
Borrower knows of no proposed assessment for additional federal, foreign or
state taxes for any period, or of any basis therefor, which, individually or in
the aggregate, taking into account such charges, accruals and reserves in
respect thereof as the Borrower and its Subsidiaries have made, could reasonably
be expected to have a Material Adverse Effect.
7.11. Title to Properties, etc. The Borrower and each of its
Subsidiaries has good and marketable title, in the case of real property, and
good title (or valid Leaseholds, in the case of any leased property), in the
case of all other property, to all of its properties and assets free and clear
of Liens other than Permitted Liens. The interests of the Borrower and each of
its Subsidiaries in the properties reflected in the most recent balance sheet
referred to in section 7.8, taken as a whole, were sufficient, in the judgment
of the Borrower, as of the date of such balance sheet for purposes of the
ownership and operation of the businesses conducted by the Borrower and such
Subsidiaries.
7.12. Lawful Operations, etc. Except for known situations or incidents
which are reserved for on the most recent consolidated balance sheet referred to
in section 7.8 or which, if not so reserved, could not reasonably be expected to
have a Material Adverse Effect, the Borrower and each of its Subsidiaries is in
full compliance with all material requirements imposed by law, whether federal
or state, including (without limitation) Environmental Laws and zoning
ordinances.
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7.13. Environmental Matters. (a) The Borrower and each of its
Subsidiaries is in compliance with all Environmental Laws governing its
business, except to the extent that any such failure to comply (together with
any resulting penalties, fines or forfeitures) would not reasonably be expected
to have a Material Adverse Effect. All licenses, permits, registrations or
approvals required for the business of the Borrower and each of its Subsidiaries
under any Environmental Law have been secured and the Borrower and each of its
Subsidiaries is in substantial compliance therewith, except for such licenses,
permits, registrations or approvals the failure to secure or to comply therewith
is not reasonably likely to have a Material Adverse Effect. Neither the Borrower
nor any of its Subsidiaries has received written notice, or otherwise knows,
that it is in any respect in noncompliance with, breach of or default under any
Environmental Laws, and no event has occurred and is continuing which, with the
passage of time or the giving of notice or both, would constitute noncompliance,
breach of or default thereunder, except in each such case, such noncompliance,
breaches or defaults as would not reasonably be expected to, in the aggregate,
have a Material Adverse Effect. There are no Environmental Claims pending or, to
the best knowledge of the Borrower, threatened wherein an unfavorable decision,
ruling or finding would reasonably be expected to have a Material Adverse
Effect.
(b) Hazardous Materials have not at any time been (i) generated, used,
treated or stored on, or transported to or from, any Real Property of the
Borrower or any of its Subsidiaries or (ii) released on any such Real Property,
in each case where such occurrence or event is not in compliance with
Environmental Laws and is reasonably likely to have a Material Adverse Effect.
7.14. Compliance with ERISA. Compliance by the Borrower with the
provisions hereof and Credit Events contemplated hereby will not involve any
prohibited transaction within the meaning of ERISA or section 4975 of the Code.
The Borrower and each of its Subsidiaries, (i) has fulfilled all obligations
under minimum funding standards of ERISA and the Code with respect to each Plan
that is not a Multiemployer Plan or a Multiple Employer Plan, (ii) has satisfied
all respective contribution obligations in respect of each Multiemployer Plan
and each Multiple Employer Plan, (iii) is in compliance in all material respects
with all other applicable provisions of ERISA and the Code with respect to each
Plan, each Multiemployer Plan and each Multiple Employer Plan, and (iv) has not
incurred any liability under the Title IV of ERISA to the PBGC with respect to
any Plan, any Multiemployer Plan, any Multiple Employer Plan, or any trust
established thereunder. No Plan or trust created thereunder has been terminated,
and there have been no Reportable Events, with respect to any Plan or trust
created thereunder or with respect to any Multiemployer Plan or Multiple
Employer Plan, which termination or Reportable Event will or could result in the
termination of such Plan, Multiemployer Plan or Multiple Employer Plan and give
rise to a material liability of the Borrower or any ERISA Affiliate in respect
thereof. Neither the Borrower nor any ERISA Affiliate is at the date hereof, or
has been at any time within the two years preceding the date hereof, an employer
required to contribute to any Multiemployer Plan or Multiple Employer Plan, or a
"contributing sponsor" (as such term is defined in section 4001 of ERISA) in any
Multiemployer Plan or Multiple Employer Plan. Neither the Borrower nor any ERISA
Affiliate has any contingent liability with respect to any post-retirement
"welfare benefit plan" (as such term is defined in ERISA) except as has been
disclosed to the Lenders in writing.
7.15. Intellectual Property, etc. The Borrower and each of its
Subsidiaries has obtained or has the right to use all material patents,
trademarks, service marks, trade names, copyrights, licenses and other rights
with respect to the foregoing necessary for the present and planned future
conduct of its business, without any known conflict with the rights of others,
except for such patents, trademarks, service marks, trade names, copyrights,
licenses and rights, the loss of which, and such conflicts, which in any such
case individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect.
7.16. Investment Company Act, etc. Neither the Borrower nor any of its
Subsidiaries is subject to regulation with respect to the creation or incurrence
of Indebtedness under the Investment Company Act of 1940, as amended, the ICC
Termination Act of 1995, as amended, the Federal Power Act, as amended, the
Public Utility Holding Company Act of 1935, as amended, or any applicable state
public utility law.
7.17. Burdensome Contracts; Labor Relations. Neither the Borrower nor
any of its Subsidiaries (i) is subject to any burdensome contract, agreement,
corporate restriction, judgment, decree or order, (ii) is a party to any labor
dispute affecting any bargaining unit or other group of employees generally,
(iii) is subject to any material strike, slow down, workout or other concerted
interruptions of operations by employees of the Borrower or any Subsidiary,
whether or not relating to any labor contracts, (iv) is subject to any
significant pending or, to the knowledge of the Borrower, threatened, unfair
labor practice complaint, before the National Labor Relations Board, and (v) is
subject
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to any significant pending or, to the knowledge of the Borrower, threatened,
grievance or significant arbitration proceeding arising out of or under any
collective bargaining agreement, (vi) is subject to any significant pending or,
to the knowledge of the Borrower, threatened, significant strike, labor dispute,
slowdown or stoppage, or (vii) is, to the knowledge of the Borrower, involved or
subject to any union representation organizing or certification matter with
respect to the employees of the Borrower or any of its Subsidiaries, except
(with respect to any matter specified in any of the above clauses), for such
matters as, individually or in the aggregate, could not reasonably be expected
to have a Material Adverse Effect.
7.18. Existing Indebtedness. Annex III sets forth a true and complete
list, as of the date or dates set forth therein, of all Indebtedness of the
Borrower and each of its Subsidiaries, on a consolidated basis, which (i) has an
outstanding principal amount of at least $5,000,000, or may be incurred pursuant
to existing commitments or lines of credit, or (ii) is secured by any Lien on
any property of the Borrower or any Subsidiary, and which will be outstanding on
the Closing Date after giving effect to any Borrowing hereunder which is
expected to be made on the Closing Date, other than the Indebtedness created
under the Credit Documents (all such Indebtedness, whether or not in a principal
amount meeting such threshold and required to be so listed on Annex III, herein
the "EXISTING INDEBTEDNESS"). The Borrower has provided to the Administrative
Agent prior to the date of execution hereof true and complete copies (or summary
descriptions) of all agreements and instruments governing the Indebtedness
listed on Annex III (the "EXISTING INDEBTEDNESS AGREEMENTS").
7.19. True and Complete Disclosure. All factual information (taken as a
whole) heretofore or contemporaneously furnished by or on behalf of the Borrower
or any of its Subsidiaries in writing to the Administrative Agent or any Lender
for purposes of or in connection with this Agreement or any transaction
contemplated herein is, and all other such factual information (taken as a
whole) hereafter furnished by or on behalf of such person in writing to any
Lender will be, true and accurate in all material respects on the date as of
which such information is dated or certified and not incomplete by omitting to
state any material fact necessary to make such information (taken as a whole)
not misleading at such time in light of the circumstances under which such
information was provided, except that any such future information which may
consist of financial projections prepared by the Borrower is only represented
herein as being based on good faith estimates and assumptions believed by such
persons to be reasonable at the time made, it being recognized by the Lenders
that such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections may
differ materially from the projected results.
SECTION 8. AFFIRMATIVE COVENANTS.
The Borrower hereby covenants and agrees that on the Effective Date and
thereafter so long as this Agreement is in effect and until such time as the
Total Commitment has been terminated, no Notes remain outstanding and the Loans,
together with interest, Fees and all other Obligations incurred hereunder and
under the other Credit Documents, have been paid in full:
8.1. Reporting Requirements. The Borrower will furnish to each Lender
and the Administrative Agent:
(a) Annual Financial Statements. As soon as available and in
any event within 120 days after the close of each fiscal year of the
Borrower, the consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as at the end of such fiscal year and the
related consolidated statements of income, of stockholders' equity and
of cash flows for such fiscal year, in each case setting forth
comparative figures for the preceding fiscal year, all in reasonable
detail and accompanied by the opinion with respect to such consolidated
financial statements of independent public accountants of recognized
national standing selected by the Borrower, which opinion shall be
unqualified and shall (i) state that such accountants audited such
consolidated financial statements in accordance with generally accepted
auditing standards, that such accountants believe that such audit
provides a reasonable basis for their opinion, and that in their
opinion such consolidated financial statements present fairly, in all
material respects, the consolidated financial position of the Borrower
and its consolidated subsidiaries as at the end of such fiscal year and
the consolidated results of their operations and cash flows for such
fiscal year in conformity with generally accepted accounting
principles, or (ii) contain such statements as are customarily included
in unqualified reports of independent
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accountants in conformity with the recommendations and requirements of
the American Institute of Certified Public Accountants (or any
successor organization).
(b) Quarterly Financial Statements. As soon as available and
in any event within 60 days after the close of each of the first three
fiscal quarters in each fiscal year of the Borrower, the unaudited
consolidated balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such fiscal quarter and the related
unaudited consolidated statements of income and of cash flows for such
fiscal quarter and/or for the fiscal year to date, and setting forth,
in the case of such unaudited consolidated statements of income and of
cash flows, comparative figures for the related periods in the prior
fiscal year, and which shall be certified on behalf of the Borrower by
the Chief Financial Officer or other Authorized Officer of the
Borrower, subject to changes resulting from normal year-end audit
adjustments.
(c) Officer's Compliance Certificates. At the time of the
delivery of the financial statements provided for in sections 8.1(a)
and (b), a certificate on behalf of the Borrower of the Chief Financial
Officer or other Authorized Officer of the Borrower to the effect that,
to the best knowledge of the Borrower, no Default or Event of Default
exists or, if any Default or Event of Default does exist, specifying
the nature and extent thereof and the actions the Borrower proposes to
take with respect thereto, which certificate shall set forth the
calculations required to establish compliance with the provisions of
sections 9.6 and 9.7 of this Agreement.
(d) Notice of Default. Promptly, and in any event within 5
days after the Borrower or any of its Subsidiaries obtains knowledge
thereof, notice of the occurrence of any event which constitutes a
Default or Event of Default, which notice shall specify the nature
thereof, the period of existence thereof and what action the Borrower
proposes to take with respect thereto.
(e) ERISA. Promptly, and in any event within 15 days after the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate knows
of the occurrence of any of the following, the Borrower will deliver to
each of the Lenders a certificate on behalf of the Borrower of an
Authorized Officer of the Borrower setting forth the full details as to
such occurrence and the action, if any, that the Borrower, such
Subsidiary or such ERISA Affiliate is required or proposes to take,
together with any notices required or proposed to be given to or filed
with or by the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC,
a Plan participant or the Plan administrator with respect thereto:
(i) that a Reportable Event has occurred with respect
to any Plan;
(ii) the institution of any steps by the Borrower,
any ERISA Affiliate, the PBGC or any other person to terminate
any Plan;
(iii) the institution of any steps by the Borrower or
any ERISA Affiliate to withdraw from any Plan;
(iv) the institution of any steps by the Borrower or
any Subsidiary to withdraw from any Multiemployer Plan or
Multiple Employer Plan, if such withdrawal could result in
withdrawal liability (as described in Part 1 of Subtitle E of
Title IV of ERISA) in excess of $5,000,000;
(v) a non-exempt "prohibited transaction" within the
meaning of section 406 of ERISA in connection with any Plan;
(vi) that a Plan has an Unfunded Current Liability
exceeding $5,000,000;
(vii) any material increase exceeding $5,000,000 in
the contingent liability of the Borrower or any Subsidiary
with respect to any post-retirement welfare liability; or
(viii) the taking of any action by, or the
threatening of the taking of any action by, the Internal
Revenue Service, the Department of Labor or the PBGC with
respect to any of the foregoing.
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(f) Environmental Matters. Promptly upon, and in any event
within 10 Business Days after, an officer of the Borrower or any of its
Subsidiaries obtains knowledge thereof, notice of one or more of the
following environmental matters: (i) any pending or overtly threatened
in writing material Environmental Claim against the Borrower or any of
its Subsidiaries or any Real Property owned or operated by the Borrower
or any of its Subsidiaries; (ii) any condition or occurrence on or
arising from any Real Property owned or operated by the Borrower or any
of its Subsidiaries that (A) results in material noncompliance by the
Borrower or any of its Subsidiaries with any applicable Environmental
Law or (B) would reasonably be expected to form the basis of a material
Environmental Claim against the Borrower or any of its Subsidiaries or
any such Real Property; (iii) any condition or occurrence on any Real
Property owned, leased or operated by the Borrower or any of its
Subsidiaries that would reasonably be expected to cause such Real
Property to be subject to any material restrictions on the ownership,
occupancy, use or transferability by the Borrower or any of its
Subsidiaries of such Real Property under any Environmental Law; and
(iv) the taking of any material removal or remedial action in response
to the actual or alleged presence of any Hazardous Material on any Real
Property owned, leased or operated by the Borrower or any of its
Subsidiaries as required by any Environmental Law or any governmental
or other administrative agency. All such notices shall describe in
reasonable detail the nature of the Environmental Claim, the Borrower's
or such Subsidiary's response thereto and the potential exposure in
dollars, if known or reasonably quantifiable, of the Borrower and its
Subsidiaries with respect thereto.
(g) SEC Reports and Registration Statements. Promptly after
transmission thereof or other filing with the SEC, copies of all
registration statements (other than the exhibits thereto and any
registration statement on Form S-8 or its equivalent) and all annual,
quarterly or current reports that the Borrower or any of its
Subsidiaries files with the SEC on Form 10-K, 10-Q or 8-K (or any
successor forms).
(h) Annual and Quarterly Reports, Proxy Statements and other
Reports Delivered to Stockholders Generally. Promptly after
transmission thereof to its stockholders, copies of all annual,
quarterly and other reports and all proxy statements that the Borrower
furnishes to its stockholders generally.
(i) Other Information. With reasonable promptness, such other
information or documents (financial or otherwise) relating to the
Borrower or any of its Subsidiaries as any Lender may reasonably
request from time to time.
8.2. Books, Records and Inspections. The Borrower will, and will cause
each of its Subsidiaries to, (i) keep proper books of record and account, in
which full and correct entries shall be made of all financial transactions and
the assets and business of the Borrower or such Subsidiaries, as the case may
be, in accordance with GAAP; and (ii) permit, upon at least five Business Days'
notice to the Chief Financial Officer of the Borrower, officers and designated
representatives of the Administrative Agent or any of the Lenders to visit and
inspect any of the properties or assets of the Borrower and any of its
Subsidiaries in whomsoever's possession (but only to the extent the Borrower or
such Subsidiary has the right to do so to the extent in the possession of
another person), to examine the books of account of the Borrower and any of its
Subsidiaries, and make copies thereof and take extracts therefrom, and to
discuss the affairs, finances and accounts of the Borrower and of any of its
Subsidiaries with, and be advised as to the same by, its and their officers and
independent accountants and independent actuaries, if any, all at such
reasonable times and intervals and to such reasonable extent as the
Administrative Agent or any of the Lenders may request.
8.3. Insurance. The Borrower will, and will cause each of its
Subsidiaries to, (i) maintain insurance coverage by such insurers and in such
forms and amounts and against such risks as are generally consistent with the
insurance coverage maintained by the Borrower and its Subsidiaries at the date
hereof, and (ii) forthwith upon any Lender's written request, furnish to such
Lender (with a copy to the Administrative Agent) such information about such
insurance as such Lender may from time to time reasonably request, which
information shall be prepared in form and detail satisfactory to such Lender and
certified by an Authorized Officer of the Borrower.
8.4. Payment of Taxes and Claims. The Borrower will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
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income or profits, or upon any properties belonging to it, prior to the date on
which penalties attach thereto, and all lawful claims which, if unpaid, could
become a Lien or charge upon any properties of the Borrower or any of its
Subsidiaries; provided that neither the Borrower nor any of its Subsidiaries
shall be required to pay any such tax, assessment, charge, levy or claim which
is being contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with GAAP; and PROVIDED,
FURTHER, that the Borrower will not be considered to be in default of any of the
provisions of this sentence if the Borrower or any Subsidiary fails to pay any
such amount which, individually or in the aggregate, is immaterial.
8.5. Corporate Franchises. The Borrower will do, and will cause each of
its Subsidiaries to do, or cause to be done, all things necessary to preserve
and keep in full force and effect its corporate existence, rights and authority,
PROVIDED that nothing in this section 8.5 shall be deemed to prohibit (i) any
transaction permitted by section 9.2; (ii) the termination of existence of any
Subsidiary if (A) the Borrower determines that such termination is in its best
interest and (B) such termination is not adverse in any material respect to the
Lenders; or (iii) the loss of any rights, authorities or franchises if the loss
thereof, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
8.6. Good Repair. The Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment used or
useful in its business in whomsoever's possession they may be, are kept in good
repair, working order and condition, normal wear and tear excepted, and that
from time to time there are made in such properties and equipment all needful
and proper repairs, renewals, replacements, extensions, additions, betterments
and improvements, thereto, to the extent and in the manner customary for
companies in similar businesses.
8.7. Compliance with Statutes, etc. The Borrower will, and will cause
each of its Subsidiaries to, comply, in all material respects, with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property, other than those (i)
the noncompliance with which would not have, and which would not be reasonably
expected to have, a Material Adverse Effect; and/or (ii) imposed by
Environmental Laws, as to which section 8.8 shall be applicable.
8.8. Compliance with Environmental Laws. Without limitation of the
covenants contained in section 8.7 hereof, the Borrower will comply, and will
cause each of its Subsidiaries to comply, in all material respects, with all
Environmental Laws applicable to the ownership, lease or use of all Real
Property now or hereafter owned, leased or operated by the Borrower or any of
its Subsidiaries, and will promptly pay or cause to be paid all costs and
expenses incurred in connection with such compliance, EXCEPT to the extent that
such compliance with Environmental Laws is being contested in good faith and by
appropriate proceedings and for which adequate reserves have been established to
the extent required by GAAP, and an adverse outcome in such proceedings is not
reasonably expected to have a Material Adverse Effect.
8.9. Fiscal Years, Fiscal Quarters. If the Borrower shall change any of
its or any of its Subsidiaries' fiscal years or fiscal quarters (other than the
fiscal year or fiscal quarters of a person which becomes a Subsidiary, made at
the time such person becomes a Subsidiary to conform to the Borrower's fiscal
year and fiscal quarters), the Borrower will promptly, and in any event within
30 days following any such change, deliver a notice to the Administrative Agent
and the Lenders describing such change and any material accounting entries made
in connection therewith and stating whether such change will have any impact
upon any financial computations to be made hereunder, and if any such impact is
foreseen, describing in reasonable detail the nature and extent of such impact.
If the Required Lenders determine that any such change will have any impact upon
any financial computations to be made hereunder which is adverse to the Lenders,
the Borrower will, if so requested by the Administrative Agent, enter into an
amendment to this Agreement, in form and substance reasonably satisfactory to
the Administrative Agent and the Required Lenders, modifying any of the
financial covenants or related provisions hereof in such manner as the Required
Lenders determine is necessary to eliminate such adverse effect.
8.10. Hedge Agreements, etc. If the Borrower determines to enter into
any Hedge Agreement, it may do so, and if any Subsidiary of the Borrower
determines to enter into any Hedge Agreement, the Borrower will ensure that it
does so, but only if such Hedge Agreement is entered into in compliance with the
following requirements: (i) the principal purpose of such Hedge Agreement,
insofar as the Borrower or any Subsidiary is concerned, is to provide protection
to the Borrower or any such Subsidiary from fluctuations and other changes in
interest rates, currency exchange rates and/or raw material or commodity prices,
as and to the extent considered reasonably necessary by the
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Borrower; and (ii) such Hedge Agreement does not expose the Borrower or its
Subsidiaries to predominantly speculative risks unrelated to the amount of
assets, Indebtedness or other liabilities intended to be subject to coverage on
a notional basis under such Hedge Agreement and any other Hedge Agreements
related thereto.
8.11. Certain Subsidiaries to Join in Subsidiary Guaranty. (a) In the
event that at any time after the Closing Date
(x) the Borrower has any Material Subsidiary (other than a
Foreign Subsidiary as to which section 8.11(b) applies) which is not a
party to the Subsidiary Guaranty, or
(y) an Event of Default shall have occurred and be continuing
and the Borrower has any Subsidiary which is not a party to the
Subsidiary Guaranty,
then the Borrower will notify the Administrative Agent in writing of such event,
identifying the Subsidiary in question and referring specifically to the rights
of the Administrative Agent and the Lenders under this section. The Borrower
will, within 30 days following request therefor from the Administrative Agent
(who may give such request on its own initiative and who shall so give such
request if so instructed by the Required Lenders), cause such Subsidiary to
deliver to the Administrative Agent, in sufficient quantities for the Lenders,
(i) a Subsidiary Guaranty (as modified, amended or supplemented from time to
time in accordance with the terms thereof and hereof, the "SUBSIDIARY
GUARANTY"), substantially in the form attached hereto as Exhibit C, if the
Subsidiary Guaranty has not previously been executed and delivered, (ii) if the
Subsidiary Guaranty has previously been executed and delivered, a joinder
supplement, reasonably satisfactory in form and substance to the Administrative
Agent and the Required Lenders, duly executed by such Subsidiary, pursuant to
which such Subsidiary joins in the Subsidiary Guaranty as a guarantor
thereunder, and (ii) if such Subsidiary is a corporation, resolutions of the
Board of Directors of such Subsidiary, certified by the Secretary or an
Assistant Secretary of such Subsidiary as duly adopted and in full force and
effect, authorizing the execution and delivery of such joinder supplement, or if
such Subsidiary is not a corporation, such other evidence of the authority of
such Subsidiary to execute such joinder supplement as the Administrative Agent
may reasonably request. The Borrower represents and warrants that, as of the
date hereof and as of the Closing Date, the Borrower has no Domestic Subsidiary
which, when considered alone or together with its Subsidiaries, would be a
Material Subsidiary.
(b) Notwithstanding the foregoing provisions of this section 8.11, the
Borrower shall not, unless an Event of Default shall have occurred and be
continuing, be required to cause a Foreign Subsidiary to join in the Subsidiary
Guaranty if (i) to do so would subject the Borrower to liability for additional
United States income taxes by virtue of section 956 of the Code in an amount the
Borrower considers material, and (ii) the Borrower provides the Administrative
Agent with documentation, including computations prepared by the Borrower's
internal tax officer, its independent accountants or tax counsel, reasonably
acceptable to the Required Lenders, in support thereof.
8.12. Most Favored Covenant Status. Should the Borrower at any time
after the Effective Date, issue or guarantee any unsecured Indebtedness
denominated in U.S. dollars for money borrowed or represented by bonds, notes,
debentures or similar securities in an aggregate amount exceeding $50,000,000,
to any lender or group of lenders acting in concert with one another, or one or
more institutional investors, pursuant to a loan agreement, credit agreement,
note purchase agreement, indenture, guaranty or other similar instrument, which
agreement, indenture, guaranty or instrument, includes affirmative or negative
business or financial covenants (or any events of default or other type of
restriction which would have the practical effect of any affirmative or negative
business or financial covenant, including, without limitation, any "put" or
mandatory prepayment of such Indebtedness upon the occurrence of a "change of
control") which are applicable to the Borrower, other than those set forth
herein or in any of the other Credit Documents, the Borrower shall promptly so
notify the Administrative Agent and the Lenders and, if the Administrative Agent
shall so request by written notice to the Borrower (after a determination has
been made by the Required Lenders that any of the above-referenced documents or
instruments contain any such provisions, which either individually or in the
aggregate, are more favorable to the holders of such unsecured Indebtedness than
any of the provisions set forth herein), the Borrower, the Administrative Agent
and the Lenders shall promptly amend this Agreement to incorporate some or all
of such provisions, in the discretion of the Administrative Agent and the
Required Lenders, into this Agreement and, to the extent necessary and
reasonably desirable to the Administrative Agent and the Required Lenders, into
any of the other Credit Documents, all at the election of the Administrative
Agent and the Required Lenders.
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8.13. Senior Debt. The Borrower will at all times ensure that (i) the
claims of the Lenders in respect of the Obligations of the Borrower will in all
respects rank prior to or on a parity with the claims of every senior unsecured
creditor of the Borrower, and (ii) any Indebtedness of the Borrower which is
subordinated in any manner to the claims of any other creditor of the Borrower
will be subordinated in like manner to such claims of the Lenders.
SECTION 9. NEGATIVE COVENANTS.
The Borrower hereby covenants and agrees that on the Effective Date and
thereafter for so long as this Agreement is in effect and until such time as the
Total Commitment has been terminated, no Notes remain outstanding and the Loans,
together with interest, Fees and all other Obligations incurred hereunder and
under the other Credit Documents, have been paid in full:
9.1. Changes in Business. Neither the Borrower nor any of its
Subsidiaries will engage in any business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Borrower and its Subsidiaries, would be substantially changed from the
general nature of the business engaged in by the Borrower and its Subsidiaries
on the Effective Date.
9.2. Consolidation, Merger, Asset Sales, etc. The Borrower will not,
and will not permit any Subsidiary to, (1) enter into any transaction of merger
or consolidation, (2) sell all or substantially all of its Property and
business, (3) otherwise make or effect any Asset Sale, or (4) agree to do any of
the foregoing at any future time, except that the following shall be permitted:
(a) Certain Intercompany Mergers, etc. If no Default or Event
of Default shall have occurred and be continuing or would result
therefrom,
(i) the merger, consolidation or amalgamation of any
Subsidiary of the Borrower with or into the Borrower, PROVIDED
the Borrower is the surviving or continuing or resulting
corporation;
(ii) the merger, consolidation or amalgamation of any
Subsidiary of the Borrower with or into another Subsidiary of
the Borrower, PROVIDED that the surviving or continuing or
resulting corporation is a Wholly-Owned Subsidiary of the
Borrower;
(iii) the liquidation, winding up or dissolution of
any Subsidiary of the Borrower; and
(iv) the making of any Asset Sale by the Borrower to
any Wholly-Owned Subsidiary or by any Subsidiary to the
Borrower or any other Wholly-Owned Subsidiary of the Borrower;
shall each be permitted.
(b) Other Mergers, etc. Involving the Borrower. The
Borrower may consolidate or merge with any other corporation, or sell,
transfer or otherwise dispose of all or substantially all of the
property and assets of the Borrower and its Subsidiaries as an entirety
to any acquiring person, if (i) the surviving, continuing or resulting
corporation of such merger or consolidation (if other than the
Borrower) or the acquiring person, is a corporation, partnership or
limited liability company formed under the laws of one of the States of
the United States or the District of Columbia, and unconditionally
assumes the obligations of the Borrower under the Credit Documents
pursuant to an assumption agreement delivered to the Administrative
Agent contemporaneously with the consummation of such transaction and
in form and substance reasonably satisfactory to the Required Lenders,
(ii) no Event of Default has occurred and is continuing or would result
therefrom, (iii) no Change of Control would be occasioned thereby, and
(iv) the Consolidated Net Worth of the surviving, continuing or
resulting corporation of such merger or consolidation or the acquiring
person, as applicable, is at least 95% of the Consolidated Net Worth of
the Borrower as of the end of its most recent fiscal quarter ended
prior to the date such transaction is consummated.
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(c) Asset Sales in Permitted Receivables Programs. The
Borrower or any of its Subsidiaries may make any Asset Sale consisting
of trade receivables and related collateral, credit support and similar
rights, pursuant to one or more receivables programs, to a person who
is not a Subsidiary of the Borrower; provided that (i) the
consideration to be received by the Borrower and its Subsidiaries for
any such Asset Sale consists of cash; (ii) no Default or Event of
Default shall have occurred and be continuing or would result
therefrom; and (iii) the aggregate outstanding balance of the trade
receivables subject to all such programs at any point in time is not in
excess of $150,000,000 (collectively, the "PERMITTED RECEIVABLES
PROGRAMS").
(d) Other Permitted Asset Sales. In addition to the Asset
Sales permitted in section 9.2(c) above, if no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, the Borrower or any of its Subsidiaries may make any other
Asset Sale to a person who is not a Subsidiary of the Borrower;
PROVIDED that:
(i) in the case of any such Asset Sale or related
series of Asset Sales where the fair value (as determined by
management of the Borrower) of the Property covered thereby
exceeds $50,000,000 in the aggregate, at least 75% of the
consideration to be received by the Borrower and its
Subsidiaries consists of cash;
(ii) the cumulative aggregate consideration for all
such Asset Sales completed during the the calendar ended
December 31, 2000, or any subsequent calendar year, does not
exceed $125,000,000 in the case of any such calendar year; and
(iii) in the case of any such transaction involving
consideration in excess of $50,000,000, at least five Business
Days prior to the date of completion of such transaction the
Borrower shall have delivered to the Administrative Agent an
officer's certificate executed on behalf of the Borrower by an
Authorized Officer of the Borrower, which certificate shall
contain (1) a description of the proposed transaction, the
date such transaction is scheduled to be consummated, the
estimated purchase price or other consideration for such
transaction, (2) a certification that no Default or Event of
Default has occurred and is continuing, or would result from
consummation of such transaction, and (3) which shall (if
requested by the Administrative Agent) include a certified
copy of the draft or definitive documentation pertaining
thereto;
For the avoidance of doubt, no amounts in respect of Asset Sales made
in Permitted Receivables Programs pursuant to section 9.2(c) shall be
included in any dollar computations pursuant to this section 9.2(d).
Without limitation of the foregoing, the Borrower will not directly or
indirectly use any proceeds of a Credit Event hereunder to finance an
Acquisition which is actively opposed by the Board of Directors (or similar
governing body) of the selling person or the person whose equity interests are
to be acquired, unless all of the Lenders specifically approve or consent to
such Acquisition in writing.
9.3. Restrictions on Secured Debt. The Borrower will not itself, and
will not permit any Domestic Subsidiary to, incur, issue, assume or guarantee
any indebtedness for money borrowed represented by notes, bonds, debentures or
other similar evidences of indebtedness for money borrowed (such notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed being
hereinafter called "DEBT"), secured by a Mortgage on any Principal Domestic
Manufacturing Property of the Borrower or any Domestic Subsidiary, or any shares
of stock or Debt of any Domestic Subsidiary, without effectively providing that
the Obligations of the Borrower under this Agreement and the other Credit
Documents (together with, if the Borrower shall so determine, any other Debt of
the Borrower or such Domestic Subsidiary then existing or thereafter created
which is not subordinate to the Obligations) shall be secured equally and
ratably with (or prior to) such secured Debt, so long as such secured Debt shall
be so secured, unless, after giving effect thereto, the aggregate amount of all
such secured Debt plus all Attributable Debt of the Borrower and its Domestic
Subsidiaries in respect of sale and leaseback transactions (as defined in
section 9.4) would not exceed 10% of Consolidated Net Tangible Assets; PROVIDED,
HOWEVER, that this section 9.3 shall not apply to, and there shall be excluded
from secured Debt in any computation under this section 9.3, Debt secured by:
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(1) Mortgages on property of, or on any shares of stock or
Debt of, any corporation existing at the time such corporation becomes
a Domestic Subsidiary;
(2) Mortgages in favor of the Borrower or any Domestic
Subsidiary;
(3) Mortgages on property of the Borrower or a Domestic
Subsidiary in favor of the United States of America or any State
thereof, or Puerto Rico, or any department, agency or instrumentality
or political subdivision of the United States of America or any State
thereof, or Puerto Rico, or in favor of any other country, or any
political subdivision thereof, to secure partial, progress, advance or
other payments pursuant to any contract or statute;
(4) Mortgages on property, shares of stock or Debt existing at
the time of acquisition thereof (including acquisition through merger
or consolidation) or to secure the payment of all or any part of the
purchase price or construction or improvement cost thereof or to secure
any Debt incurred prior to, at the time of, or within 120 days after,
the acquisition of such property or shares or Debt or the completion of
any such construction or improvement for the purpose of financing all
or any part of the purchase price or construction or improvement cost
thereof;
(5) Mortgages securing obligations issued by a State,
territory or possession of the United States, any political subdivision
of any of the foregoing, or the District of Columbia, or any
instrumentality of the foregoing to finance the acquisition or
construction or property, and on which the interest is not, in the
opinion of tax counsel of recognized standing or in accordance with a
ruling of the Internal Revenue Service, includable in gross income of
the holder by reason of section 103(a)(1) of the Internal Revenue Code
(or any successor to such provision as in effect at the time of
issuance of such obligations); and
(6) any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of any
Debt secured by any Mortgage referred to in the foregoing clauses (1)
to (5), inclusive; PROVIDED, that (i) such extension, or replacement
Mortgage shall be limited to all or a part of the same property, shares
of stock or Debt that secured the Mortgage extended, renewed or
replaced (plus improvements on such property) and (ii) the Debt secured
by such Mortgage at such time is not increased.
9.4. Limitation on Sales and Leasebacks. The Borrower will not itself,
and it will not permit any Domestic Subsidiary to, enter into any arrangement
with any bank, insurance company or other lender or investor (not including the
Borrower or any Subsidiary) or to which any such lender or investor is a party,
providing for the leasing by the Borrower or any Domestic Subsidiary for a
period, including renewals, in excess of three years of any Principal Domestic
Manufacturing Property which has been or is to be sold or transferred, more than
120 days after the acquisition thereof or the completion of construction and
commencement of full operation thereof, by the Borrower or any Domestic
Subsidiary to such lender or investor or to any person to whom funds have been
or are to be advanced by such lender or investor on the security of such
Principal Domestic Manufacturing Property (herein referred to as a "SALE AND
LEASEBACK TRANSACTION") unless either:
(1) the Borrower or such Domestic Subsidiary could create Debt
secured by a Mortgage pursuant to section 9.3 on the Principal Domestic
Manufacturing Property to be leased back in an amount equal to the
Attributable Debt with respect to such sale and leaseback transaction
without equally and ratably securing the Obligations, or
(2) the Borrower within 120 days after the sale or transfer
shall have been made by the Borrower or by any such Domestic
Subsidiary, applies an amount equal to the greater of (i) the net
proceeds of the sale of the Principal Domestic Manufacturing Property
sold and leased back pursuant to such arrangement or (ii) the fair
market value of the Principal Domestic Manufacturing Property so sold
and leased back at the time of entering into such arrangements (as
determined by any two of the following: the Chairman of the Board of
the Borrower, its President, any Vice President, Finance of the
Borrower, its Treasurer and its Controller) to the retirement of Funded
Debt of the Borrower which is PARI PASSU with the Obligatuions;
PROVIDED, that the amount to be applied to the retirement of Funded
Debt of the Borrower shall be reduced by (a) the amount by which the
Total General Revolving Commitment was permanently reduced during the
120 days after such sale, if any such reduction in fact occurred, and
(b) the principal amount of
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such Funded Debt, other than Obligations, voluntarily retired by the
Borrower within 120 days after such sale. Notwithstanding the
foregoing, no retirement referred to in this clause (2) may be effected
by payment at maturity or pursuant to any mandatory sinking fund
payment or any mandatory prepayment provision.
9.5. Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness of the Borrower or any of its Subsidiaries, EXCEPT:
(a) Credit Documents: Indebtedness incurred under this
Agreement and the other Credit Documents;
(b) Existing Indebtedness: Existing Indebtedness; and any
refinancing, extension, renewal or refunding of any such Existing
Indebtedness not involving an increase in the principal amount thereof
or a reduction of more than 10% in the remaining weighted average life
to maturity thereof (computed in accordance with standard financial
practice); PROVIDED that any Existing Indebtedness identified in Annex
III or otherwise referred to in section 6.1 as being intended to be
refinanced by Loans incurred hereunder or otherwise retired, may not be
otherwise refinanced;
(c) Intercompany Debt: the following: (i) unsecured
Indebtedness of the Borrower owed to any of its Subsidiaries; and (ii)
Indebtedness of any of the Borrower's Subsidiaries owed to the Borrower
or to another Subsidiary of the Borrower;
(d) Hedge Agreements: Indebtedness of the Borrower and its
Subsidiaries under Hedge Agreements; and
(e) Additional Indebtedness and Guaranty Obligations:
additional Indebtedness and Guaranty Obligations of the Borrower and/or
any of its Subsidiaries, not otherwise permitted pursuant to the
foregoing clauses, without limitation as to aggregate amount, PROVIDED
that at the time of incurrence thereof and after giving effect thereto,
(i) no Event of Default shall have occurred and be continuing or shall
result therefrom, (ii) if such Indebtedness or Guaranty Obligations is
secured by any collateral, such Indebtedness is permitted by section
9.3, and (iii) the Borrower would have been in compliance with the
covenants contained in sections 9.6 and 9.7 hereof if such Indebtedness
had been incurred at the beginning of the most recent Testing Period
for which financial information has been furnished to the Lenders
hereunder, and such Indebtedness remained outstanding throughout such
Testing Period.
9.6. Consolidated Total Debt/Consolidated EBITDA Ratio. The Borrower
will not at any time permit the ratio of (x) the amount of Consolidated Total
Debt at such time to (y) Consolidated EBITDA for its then most recent Testing
Period, to exceed 3.25 to 1.00.
9.7. Interest Coverage Ratio. The Borrower will not permit the ratio of
(x) Consolidated EBITDA for any Testing Period, to (y) Consolidated Interest
Expense for such Testing Period, to be less than 4.00 to 1.00.
9.8. No Stock Repurchases While Index Debt is Not Investment Grade,
etc. The Borrower will not, at any time when its Index Debt is not Investment
Grade, directly or indirectly make, or permit any of its Subsidiaries to
directly or indirectly make, any purchase, redemption, retirement or other
acquisition of (i) any shares of capital stock of any class of the Borrower
(other than for a consideration consisting solely of capital stock of the same
class of the Borrower), or (ii) any warrants, rights or options to acquire, or
any securities convertible into or exchangeable for, any capital stock of the
Borrower.
9.9. Transactions with Affiliates. The Borrower will not, and will not
permit any Subsidiary to, enter into any transaction or series of transactions
with any Affiliate (other than, in the case of the Borrower, any Subsidiary, and
in the case of a Subsidiary, the Borrower or another Subsidiary) other than in
the ordinary course of business of and pursuant to the reasonable requirements
of the Borrower's or such Subsidiary's business and upon fair and reasonable
terms no less favorable to the Borrower or such Subsidiary than would obtain in
a comparable arm's-length transaction with a person other than an Affiliate,
except agreements and transactions with and payments to employees, officers,
directors, shareholders and other Affiliates which are either (i) entered into
in the ordinary course of business
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and not prohibited by any of the provisions of this Agreement, or (ii) entered
into outside the ordinary course of business, approved by the directors or
shareholders of the Borrower, and not prohibited by any of the provisions of
this Agreement.
9.10. Plan Terminations, Minimum Funding, etc. The Borrower will not,
and will not permit any ERISA Affiliate to, (i) terminate any Plan or Plans so
as to result in liability of the Borrower or any ERISA Affiliate to the PBGC in
excess of, in the aggregate, $5,000,000, (ii) permit to exist one or more events
or conditions which reasonably present a material risk of the termination by the
PBGC of any Plan or Plans with respect to which the Borrower or any ERISA
Affiliate would, in the event of such termination, incur liability to the PBGC
in excess of such amount in the aggregate, or (iii) fail to comply with the
minimum funding standards of ERISA and the Code with respect to any Plan.
SECTION 10. EVENTS OF DEFAULT.
10.1. Events of Default. Any of the following specified events shall
constitute an Event of Default (each an "EVENT OF DEFAULT"):
(a) Payments: the Borrower shall (i) default in the payment
when due of any principal of the Loans or any reimbursement obligation
in respect of any Unpaid Drawing; or (ii) default, and such default
shall continue for five or more Business Days, in the payment when due
of any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document; or
(b) Representations, etc.: any representation, warranty or
statement made by the Borrower or any other Credit Party herein or in
any other Credit Document or in any statement or certificate delivered
or required to be delivered pursuant hereto or thereto shall prove to
be untrue in any material respect on the date as of which made or
deemed made; or
(c) Certain Negative Covenants: the Borrower shall default in
the due performance or observance by it of any term, covenant or
agreement contained in sections 9.2 through 9.8, inclusive, of this
Agreement, or section 9.10 of this Agreement; or
(d) Other Covenants: the Borrower shall default in the due
performance or observance by it of any term, covenant or agreement
contained in this Agreement or any other Credit Document, other than
those referred to in section 10.1(a) or (b) or (c) above, and such
default is not remedied within 30 days after the earlier of (i) an
officer of the Borrower obtaining actual knowledge of such default and
(ii) the Borrower receiving written notice of such default from the
Administrative Agent or the Required Lenders (any such notice to be
identified as a "notice of default" and to refer specifically to this
paragraph); or
(e) Cross Default Under Other Agreements: the Borrower or any
of its Subsidiaries shall (i) default in any payment with respect to
any Indebtedness (other than the Obligations) owed to any Lender, or
having an aggregate unpaid principal amount (or Capitalized Lease
Obligation, in the case of a Capital Lease, or present value, based on
the implicit interest rate, in the case of a Synthetic Lease) of
$25,000,000 or greater, and such default shall continue after the
applicable grace period, if any, specified in the agreement or
instrument relating to such Indebtedness, or (ii) default in the
observance or performance of any agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto (and all grace periods
applicable to such observance, performance or condition shall have
expired), or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit
the holder or holders of such Indebtedness (or a trustee or agent on
behalf of such holder or holders) to cause any such Indebtedness to
become due prior to its stated maturity; or any such Indebtedness of
the Borrower or any of its Subsidiaries shall be declared to be due and
payable, or shall be required to be prepaid (other than by a regularly
scheduled required prepayment or redemption, prior to the stated
maturity thereof), or
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(f) Other Credit Documents: the Subsidiary Guaranty (once
executed and delivered) shall cease for any reason (other than
termination in accordance with its terms) to be in full force and
effect; or any Credit Party shall default in any payment obligation
thereunder; or any Credit Party shall default in any material respect
in the due performance and observance of any other obligation
thereunder and such default shall continue unremedied for a period of
at least 30 days after notice by the Administrative Agent or the
Required Lenders; or any Credit Party shall (or seek to) disaffirm or
otherwise limit its obligations thereunder otherwise than in strict
compliance with the terms thereof; or
(g) Judgments: one or more judgments, orders or decrees shall
be entered against the Borrower and/or any of its Subsidiaries
involving a liability (other than a liability covered by insurance, as
to which the carrier has adequate claims paying ability and has not
effectively reserved its rights) of $10,000,000 or more in the
aggregate for all such judgments, orders and decrees for the Borrower
and its Subsidiaries, and any such judgments or orders or decrees shall
not have been vacated, discharged or stayed or bonded pending appeal
within 30 days (or such longer period, not in excess of 60 days, during
which enforcement thereof, and the filing of any judgment lien, is
effectively stayed or prohibited) from the entry thereof; or
(h) Bankruptcy, etc.: any of the following shall occur:
(i) the Borrower or any of its Material Subsidiaries
(the Borrower and each of such other persons, each a
"PRINCIPAL PARTY") shall commence a voluntary case concerning
itself under Title 11 of the United States Code entitled
"Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "BANKRUPTCY CODE"); or
(ii) an involuntary case is commenced against any
Principal Party under the Bankruptcy Code and the petition is
not controverted within 10 days, or is not dismissed within 60
days, after commencement of the case; or
(iii) a custodian (as defined in the Bankruptcy Code)
is appointed for, or takes charge of, all or substantially all
of the property of any Principal Party; or
(iv) any Principal Party commences (including by way
of applying for or consenting to the appointment of, or the
taking of possession by, a rehabilitator, receiver, custodian,
trustee, conservator or liquidator (collectively, a
"CONSERVATOR") of itself or all or any substantial portion of
its property) any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency, liquidation, rehabilitation,
conservatorship or similar law of any jurisdiction whether now
or hereafter in effect relating to such Principal Party; or
(v) any such proceeding is commenced against any
Principal Party to the extent such proceeding is consented by
such person or remains undismissed for a period of 60 days; or
(vi) any Principal Party is adjudicated insolvent or
bankrupt; or
(vii) any order of relief or other order approving
any such case or proceeding is entered; or
(viii) any Principal Party suffers any appointment of
any conservator or the like for it or any substantial part of
its property which continues undischarged or unstayed for a
period of 60 days; or
(ix) any Principal Party makes a general assignment
for the benefit of creditors; or
(x) any corporate (or similar organizational) action
is taken by any Principal Party for the purpose of effecting
any of the foregoing; or
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(i) ERISA: (i) any of the events described in clauses (i)
through (viii) of section 8.1(e) shall have occurred; or (ii) there
shall result from any such event or events the imposition of a lien,
the granting of a security interest, or a liability or a material risk
of incurring a liability; and (iii) any such event or events or any
such lien, security interest or liability, individually, and/or in the
aggregate, in the opinion of the Required Lenders, has had, or could
reasonably be expected to have, a Material Adverse Effect.
10.2. Acceleration, etc. Upon the occurrence of any Event of Default,
and at any time thereafter, if any Event of Default shall then be continuing,
the Administrative Agent shall, upon the written request of the Required
Lenders, by written notice to the Borrower, take any or all of the following
actions, without prejudice to the rights of the Administrative Agent or any
Lender to enforce its claims against the Borrower or any other Credit Party in
any manner permitted under applicable law:
(a) declare the Total Commitment terminated, whereupon the
Commitment of each Lender shall forthwith terminate immediately without
any other notice of any kind;
(b) declare the principal of and any accrued interest in
respect of all Loans, all Unpaid Drawings and all other Obligations
owing hereunder and under the other Credit Documents to be, whereupon
the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby
waived by the Borrower;
(c) terminate any Letter of Credit which may be terminated in
accordance with its terms;
(d) direct the Borrower to pay (and the Borrower hereby agrees
that on receipt of such notice or upon the occurrence of an Event of
Default with respect to the Borrower under section 10.1(h), it will
pay) to the Administrative Agent an amount of cash equal to the
aggregate Stated Amount of all Letters of Credit then outstanding (such
amount to be held as security for the Borrower's (and any other Letter
of Credit Obligor's) reimbursement obligations in respect thereof);
and/or
(e) exercise any other right or remedy available under any of
the Credit Documents or applicable law;
PROVIDED that, if an Event of Default specified in section 10.1(h) shall occur
with respect to the Borrower, the result which would occur upon the giving of
written notice by the Administrative Agent as specified in clauses (a) and/or
(b) above shall occur automatically without the giving of any such notice.
10.3. Application of Liquidation Proceeds. All monies received by the
Administrative Agent or any Lender from the exercise of remedies hereunder or
under the other Credit Documents or under any other documents relating to this
Agreement shall, unless otherwise required by the terms of the other Credit
Documents or by applicable law, be applied as follows:
(i) first, to the payment of all expenses (to the extent not
otherwise paid by the Borrower or any of the other Credit Parties)
incurred by the Administrative Agent and the Lenders in connection with
the exercise of such remedies, including, without limitation, all
reasonable costs and expenses of collection, reasonable documented
attorneys' fees, court costs and any foreclosure expenses;
(ii) second, to the payment PRO RATA of interest then accrued
on the outstanding Loans;
(iii) third, to the payment PRO RATA of any fees then accrued
and payable to the Administrative Agent, any Letter of Credit Issuer or
any Lender under this Agreement in respect of the Loans or the Letter
of Credit Outstandings;
(iv) fourth, to the payment PRO RATA of (A) the
principal balance then owing on the outstanding Loans, and (B) the
Stated Amount of the Letter of Credit Outstandings (to be held and
applied by the Administrative Agent as security for the reimbursement
obligations in respect thereof);
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(v) fifth, to the payment to the Lenders of any amounts then
accrued and unpaid under sections 2.9, 2.10, 3.5 and 5.4 hereof, and if
such proceeds are insufficient to pay such amounts in full, to the
payment of such amounts PRO RATA;
(vi) sixth, to the payment PRO RATA of all other amounts owed
by the Borrower to the Administrative Agent, to any Letter of Credit
Issuer or any Lender under this Agreement or any other Credit Document,
and if such proceeds are insufficient to pay such amounts in full, to
the payment of such amounts PRO RATA; and
(vii) finally, any remaining surplus after all of the
Obligations have been paid in full, to the Borrower or to whomsoever
shall be lawfully entitled thereto.
SECTION 11. THE ADMINISTRATIVE AGENT.
11.1. Appointment. Each Lender hereby irrevocably designates and
appoints NCB as Administrative Agent to act as specified herein and in the other
Credit Documents, and each such Lender hereby irrevocably authorizes NCB as the
Administrative Agent for such Lender, to take such action on its behalf under
the provisions of this Agreement and the other Credit Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Credit
Documents, together with such other powers as are reasonably incidental thereto.
The Administrative Agent agrees to act as such upon the express conditions
contained in this section 11. Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Administrative Agent shall not have any duties
or responsibilities, except those expressly set forth herein or in the other
Credit Documents, nor any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or otherwise exist against the Administrative Agent.
The provisions of this section 11 are solely for the benefit of the
Administrative Agent, and the Lenders, and the Borrower and its Subsidiaries
shall not have any rights as a third party beneficiary of any of the provisions
hereof. In performing its functions and duties under this Agreement, the
Administrative Agent shall act solely as agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or relationship of
agency or trust with or for the Borrower or any of its Subsidiaries.
11.2. Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by section 11.3.
11.3. Exculpatory Provisions. Neither the Administrative Agent nor any
of its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such person under or in connection with this Agreement (except
for its or such person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or of its Subsidiaries or any
of their respective officers contained in this Agreement, any other Credit
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Credit Document or for any failure
of the Borrower or any Subsidiary of the Borrower or any of their respective
officers to perform its obligations hereunder or thereunder. The Administrative
Agent shall not be under any obligation to any Lender to ascertain or to inquire
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of
the Borrower or any of its Subsidiaries. The Administrative Agent shall not be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any Credit
Document or for any representations, warranties, recitals or statements made
herein or therein or made in any written or oral statement or in any financial
or other statements, instruments, reports, certificates or any other documents
in connection herewith or therewith furnished or made by the Administrative
Agent to the Lenders or by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or
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therein or as to the use of the proceeds of the Loans or of the existence or
possible existence of any Default or Event of Default.
11.4. Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, facsimile transmission, telex or teletype message, statement, order or
other document or conversation believed by it, in good faith, to be genuine and
correct and to have been signed, sent or made by the proper person or persons
and upon advice and statements of legal counsel (including, without limitation,
counsel to the Borrower or any of its Subsidiaries), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Credit Document unless it shall first receive such advice
or concurrence of the Required Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Credit Documents in accordance with a request of the Required Lenders (or
all of the Lenders, or all of the Lenders (other than any Defaulting Lender), as
applicable, as to any matter which, pursuant to section 12.12, can only be
effectuated with the consent of all Lenders, or all Lenders (other than any
Defaulting Lender), as the case may be), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.
11.5. Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give prompt notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders, provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
11.6. Non-Reliance. Each Lender expressly acknowledges that neither the
Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates have made any representations or warranties to
it and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower or any of its Subsidiaries, shall be
deemed to constitute any representation or warranty by the Administrative Agent
to any Lender. Each Lender represents to the Administrative Agent 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 appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower and its Subsidiaries and made its own decision
to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent, or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower and its Subsidiaries.
The Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, assets, property, financial and other conditions, prospects or
creditworthiness of the Borrower or any of its Subsidiaries which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
11.7. Indemnification. The Lenders agree to indemnify the
Administrative Agent in its capacity as such ratably according to their
respective Loans and Unutilized Commitments, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may at
any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, incurred by or asserted against the
Administrative Agent in its capacity as such in any way relating to or arising
out of this Agreement or any other Credit Document, or any documents
contemplated by or referred to herein or the transactions contemplated hereby or
any action taken or omitted to be taken by the Administrative Agent under or in
connection with any of the foregoing, but only to the extent that any of the
foregoing
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is not paid by the Borrower, PROVIDED that no Lender shall be liable to the
Administrative Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting solely from the Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this section 11.7 shall survive the payment of all Obligations.
11.8. The Administrative Agent in Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower, its Subsidiaries
and their Affiliates as though not acting as Administrative Agent hereunder.
With respect to the Loans made by it and all Obligations owing to it, the
Administrative Agent shall have the same rights and powers under this Agreement
as any Lender and may exercise the same as though it were not the Administrative
Agent, and the terms "Lender" and "Lenders" shall include the Administrative
Agent in its individual capacity.
11.9. Successor Administrative Agent. The Administrative Agent may
resign as the Administrative Agent upon not less than 20 Business Days' notice
to the Lenders and the Borrower. The Administrative Agent may be removed as the
Administrative Agent for cause upon not less than 20 Business Days' notice to
the Administrative Agent and the Borrower from the Required Lenders. The
Required Lenders shall appoint from among the Lenders a successor Administrative
Agent for the Lenders, subject to prior approval by the Borrower if no Event of
Default has occurred and is continuing (such approval not to be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall include such successor agent effective upon its
appointment, and the resigning or removed Administrative Agent's rights, powers
and duties as the Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement. After the retiring or removed Administrative
Agent's resignation or removal hereunder as the Administrative Agent, the
provisions of this section 11 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent under this
Agreement.
11.10. Other Agents. Any Lender identified herein as a Co-Agent,
Syndication Agent, Documentation Agent, Managing Agent, Manager, Lead Arranger,
Arranger or any other corresponding title, other than "Administrative Agent",
shall have no right, power, obligation, liability, responsibility or duty under
this Agreement or any other Credit Document except those applicable to all
Lenders as such. Each Lender acknowledges that it has not relied, and will not
rely, on any Lender so identified in deciding to enter into this Agreement or in
taking or not taking any action hereunder.
SECTION 12. MISCELLANEOUS.
12.1. Payment of Expenses etc. (a) Whether or not the transactions
contemplated hereby are consummated, the Borrower agrees to pay (or reimburse
the Administrative Agent for) all reasonable out-of-pocket costs and expenses of
the Administrative Agent in connection with the negotiation, preparation,
execution and delivery of the Credit Documents and the documents and instruments
referred to therein, including, without limitation, the reasonable fees and
disbursements of Jones, Day, Reavis & Pogue, special counsel to the
Administrative Agent.
(b) The Borrower agrees to pay (or reimburse the Administrative Agent,
the Lenders and their Affiliates for) all reasonable out-of-pocket costs and
expenses of the Administrative Agent, the Lenders and their Affiliates in
connection with any amendment, waiver or consent relating to any of the Credit
Documents which is requested by any Credit Party, including, without limitation,
the reasonable fees and disbursements of Jones, Day, Reavis & Pogue, special
counsel to the Administrative Agent.
(c) The Borrower agrees to pay (or reimburse the Administrative Agent,
the Lenders and their Affiliates for) all reasonable out-of-pocket costs and
expenses of the Administrative Agent, the Lenders and their Affiliates in
connection with the enforcement of any of the Credit Documents or the other
documents and instruments referred to therein, including, without limitation,
(i) the reasonable fees and disbursements of Jones, Day, Reavis & Pogue, special
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counsel to the Administrative Agent, and (ii) the reasonable fees and
disbursements of any individual counsel to any Lender (including allocated costs
of internal counsel).
(d) Without limitation of the preceding section 12.1(c), in the event
of the bankruptcy, insolvency, rehabilitation or other similar proceeding in
respect of the Borrower or any of its Subsidiaries, the Borrower agrees to pay
all costs of collection and defense, including reasonable attorneys' fees in
connection therewith and in connection with any appellate proceeding or
post-judgment action involved therein, which shall be due and payable together
with all required service or use taxes.
(e) The Borrower agrees to pay and hold the Administrative Agent each
of the Lenders harmless from and against any and all present and future stamp
and other similar taxes with respect to the foregoing matters and save each such
Agent and each of the Lenders harmless from and against any and all liabilities
with respect to or resulting from any delay or omission (other than to the
extent attributable to any such indemnified person) to pay such taxes.
(f) The Borrower agrees to indemnify the Administrative Agent, each
Lender, and their respective officers, directors, trustees, employees,
representatives, agents and Affiliates (collectively, the "INDEMNITEES") from
and hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses reasonably incurred by any of them as a result of, or
arising out of, or in any way related to, or by reason of
(i) any investigation, litigation or other proceeding (whether
or not any Lender is a party thereto) related to the entering into
and/or performance of any Credit Document or the use of the proceeds of
any Loans hereunder or the consummation of any transactions
contemplated in any Credit Document, other than any such investigation,
litigation or proceeding arising out of transactions solely between any
of the Lenders or the Administrative Agent, transactions solely
involving the assignment by a Lender of all or a portion of its Loans
and Commitments, or the granting of participations therein, as provided
in this Agreement, or arising solely out of any examination of a Lender
by any regulatory or other governmental authority having jurisdiction
over it, or
(ii) the actual or alleged presence of Hazardous Materials in
the air, surface water or groundwater or on the surface or subsurface
of any Real Property owned, leased or at any time operated by the
Borrower or any of its Subsidiaries, the release, generation, storage,
transportation, handling or disposal of Hazardous Materials at any
location, whether or not owned or operated by the Borrower or any of
its Subsidiaries, if the Borrower or any such Subsidiary could have or
is alleged to have any responsibility in respect thereof, the non-
compliance of any such Real Property with foreign, federal, state and
local laws, regulations and ordinances (including applicable permits
thereunder) applicable thereto, or any Environmental Claim asserted
against the Borrower or any of its Subsidiaries, in respect of any such
Real Property,
including, in each case, without limitation, the reasonable documented fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of the gross
negligence or willful misconduct of the person to be indemnified or of any other
Indemnitee who is such person or an Affiliate of such person). To the extent
that the undertaking to indemnify, pay or hold harmless any person set forth in
the preceding sentence may be unenforceable because it is violative of any law
or public policy, the Borrower shall make the maximum contribution to the
payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.
12.2. Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default, each Lender is hereby authorized at any time or from time to time,
without presentment, demand, protest or other notice of any kind to the Borrower
or to any other person, any such notice being hereby expressly waived, to set
off and to appropriate and apply any and all deposits (general or special) and
any other Indebtedness at any time held or owing by such Lender (including,
without limitation, by branches, agencies and Affiliates of such Lender wherever
located) to or for the credit or the account of the Borrower against and on
account of the Obligations and liabilities of the Borrower to such Lender under
this Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations the Borrower purchased by such Lender
pursuant to section 12.4(c), and all other claims of any nature or description
arising out of or connected with this Agreement or any other Credit Document,
irrespective of whether or not such Lender shall have made any demand hereunder
and although said
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Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured. Each Lender agrees to promptly notify the Borrower after any such set
off and application, PROVIDED, HOWEVER, that the failure to give such notice
shall not affect the validity of such set off and application.
12.3. Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile or electronic e-mail transmission or
cable communication) and mailed, telegraphed, telexed, transmitted, cabled or
delivered, if to the Borrower, at 1000 Lakeside Avenue, Cleveland, Ohio 44114,
attention: D. Thomas George, Vice President and Treasurer (facsimile: (216)
875-7237); if to any Lender at its address specified for such Lender on Annex I
hereto or the Assignment Agreement or Designation Agreement pursuant to which it
became a Lender hereunder; if to the Administrative Agent, at its Notice Office;
or at such other address as shall be designated by any party in a written notice
to the other parties hereto. All such notices and communications shall be
mailed, telegraphed, telexed, telecopied, transmitted or cabled or sent by
overnight courier, and shall be effective when received.
12.4. Benefit of Agreement. (a) Successors and Assigns Generally. This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors and assigns, provided that
the Borrower may not assign or transfer any of its rights or obligations
hereunder without the prior written consent of all the Lenders, and, PROVIDED,
FURTHER, that any assignment by a Lender of its rights and obligations hereunder
shall be effected in accordance with section 12.4(c).
(b) Grant of Participations by Lenders. Notwithstanding the foregoing,
each Lender may at any time grant participations in any of its rights hereunder
or under any of the Notes to (x) an Affiliate of such Lender which is a
commercial bank, financial institution or other "accredited investor" (as
defined in SEC Regulation D), (y) another Lender which is not a Defaulting
Lender, or (z) one or more Eligible Transferees, PROVIDED that in the case of
any such participation,
(i) the participant shall not have any rights under this
Agreement or any of the other Credit Documents, including rights of
consent, approval or waiver (the participant's rights against such
Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating
thereto),
(ii) such Lender's obligations under this Agreement
(including, without limitation, its Commitment hereunder) shall remain
unchanged,
(iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations,
(iv) such Lender shall remain the holder of any Note for all
purposes of this Agreement and
(v) the Borrower, the Administrative Agent, and the other
Lenders shall continue to deal solely and directly with the selling
Lender in connection with such Lender's rights and obligations under
this Agreement, and all amounts payable by the Borrower hereunder shall
be determined as if such Lender had not sold such participation, except
that the participant shall be entitled to the benefits of sections 2.9
and 2.10 of this Agreement to the extent that such Lender would be
entitled to such benefits if the participation had not been entered
into or sold, and
PROVIDED FURTHER, that no Lender shall transfer, grant or sell any participation
under which the participant shall have rights to approve any amendment to or
waiver of this Agreement or any other Credit Document except to the extent such
amendment or waiver would (1) change any date upon which a mandatory and
automatic reduction in any Commitment in which such Participant is participating
is scheduled to be made, or change the amount thereof, (2) change any date upon
which an installment payment of any Loans in which such Participant is
participating is scheduled to be made, or change the amount thereof, (3) change
any date upon which a reimbursement obligation in respect of a Letter of Credit
or Unpaid Drawing in which such Participant is participating is scheduled to be
made, or change the amount thereof, (4) extend the final scheduled maturity of
the Loans in which such participant is participating (it being understood that
any waiver of the making of, or the application of, any mandatory prepayment to
such Loans
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shall not constitute an extension of the final maturity date thereof), (5)
reduce the rate or extend the time of payment of interest or Fees on any such
Loan or Commitment (except in connection with a waiver of the applicability of
any post-default increase in interest rates), (6) reduce the principal amount of
any such Loan, (7) increase such participant's participating interest in any
Commitment over the amount thereof then in effect, (8) extend the expiration or
termination of any Letter of Credit beyond the scheduled expiration of any
Commitment with respect thereto in which such participant is participating, (9)
release any Credit Party from its obligations under the Subsidiary Guaranty,
except strictly in accordance with the provisions of the Credit Documents, or
(10) consent to the assignment or transfer by the Borrower of any of its rights
and obligations under this Agreement.
(c) Assignments by Lenders. Notwithstanding the foregoing, (x) any
Lender may assign all or a fixed portion of its Loans and/or Commitment, and its
rights and obligations hereunder, which does not have to be pro rata among the
Facilities, to another Lender that is not a Defaulting Lender, or to an
Affiliate of any Lender (including itself) and which is not a Defaulting Lender
and which is a commercial bank, financial institution or other "accredited
investor" (as defined in SEC Regulation D), and (y) any Lender may assign all,
or if less than all, a fixed portion, equal to at least $5,000,000 in the
aggregate for the assigning Lender or assigning Lenders, of its Loans and/or
Commitment and its rights and obligations hereunder, which does not have to be
PRO RATA among the Facilities, to one or more Eligible Transferees, each of
which assignees shall become a party to this Agreement as a Lender by execution
of an Assignment Agreement, PROVIDED that,
(i) assignments by the Swing Line Lender of its Swing Line
Revolving Commitment and its Swing Line Revolving Loans may only be
made if all of its Swing Line Revolving Commitment and all of its Swing
Line Revolving Loans are assigned to a single assignee and only if the
assignee thereof is or becomes a Lender with a General Revolving
Commitment,
(ii) in the case of any assignment of a portion of any Loans
and/or Commitment of a Lender, such Lender shall retain a minimum fixed
portion of all Loans and Commitments equal to at least $5,000,000,
(iii) at the time of any such assignment Annex I shall be
deemed modified to reflect the Commitments of such new Lender and of
the existing Lenders,
(iv) upon surrender of the old Notes, new Notes will be
issued, at the Borrower's expense, to such new Lender and to the
assigning Lender, such new Notes to be in conformity with the
requirements of section 2.6 (with appropriate modifications) to the
extent needed to reflect the revised Commitments,
(v) in the case of clause (y) only, the consent of the
Administrative Agent and each Letter of Credit Issuer shall be required
in connection with any such assignment (which consent shall not be
unreasonably withheld or delayed), and
(vi) the Administrative Agent shall receive at the time of
each such assignment, from the assigning or assignee Lender, the
payment of a non-refundable assignment fee of $3,000, and
PROVIDED FURTHER, that such transfer or assignment will not be effective until
recorded by the Administrative Agent on the Lender Register maintained by it as
provided herein.
To the extent of any assignment pursuant to this section 12.4(c) the
assigning Lender shall be relieved of its obligations hereunder with respect to
its assigned Commitments.
At the time of each assignment pursuant to this section 12.4(c) to a
person which is not already a Lender hereunder and which is not a United States
person (as such term is defined in section 7701(a)(30) of the Code) for Federal
income tax purposes, the respective assignee Lender shall provide to the
Borrower and the Administrative Agent the appropriate Internal Revenue Service
Forms (and, if applicable a Section 5.4(b)(ii) Certificate) described in section
5.4(b). To the extent that an assignment of all or any portion of a Lender's
Commitment and related outstanding Obligations pursuant to this section 12.4(c)
would, at the time of such assignment, result in increased costs under section
2.9 from those being charged by the respective assigning Lender prior to such
assignment, then the Borrower shall not be obligated to pay such increased costs
(although the Borrower shall be obligated to pay any other increased costs of
the type described above resulting from changes after the date of the respective
assignment).
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Nothing in this section 12.4(c) shall prevent or prohibit (i) any
Lender which is a bank, trust company or other financial institution from
pledging its Notes or Loans to a Federal Reserve Bank in support of borrowings
made by such Lender from such Federal Reserve Bank, or (ii) any Lender which is
a trust, limited liability company, partnership or other investment company from
pledging its Notes or Loans to a trustee or agent for the benefit of holders of
certificates or debt securities issued by it. No such pledge, or any assignment
pursuant to or in lieu of an enforcement of such a pledge, shall relieve the
transferor Lender from its obligations hereunder.
(d) Designated Bidder Provisions. (i) Notwithstanding the foregoing,
each Lender may assign to one or more banks or other entities any Competitive
Bid Note or Notes held by it. In addition, each Lender (other than the
Designated Bidders) may designate one or more banks or other entities to have a
right to make Competitive Bid Loans as a Lender pursuant to section 2.3;
PROVIDED, HOWEVER, that (A) no such Lender shall be entitled to make more than
three such designations, (B) each such Lender making one or more of such
designations shall retain the right to make Competitive Bid Loans as a Lender
pursuant to section 2.3, (C) each such designation shall be to a Designated
Bidder, and (D) the parties to each such designation shall execute and deliver
to the Administrative Agent, for its acceptance and recording in the Lender
Register, a Designation Agreement. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Designation
Agreement, the designee thereunder shall be a party hereto with a right to make
Competitive Bid Loans as a Lender pursuant to section 2.3 and the obligations
related thereto.
(ii) By executing and delivering a Designation Agreement, the Lender
making the designation thereunder and its designee thereunder confirm and agree
with each other and the other parties hereto as follows: (A) such Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (B) such Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower or any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (C) such designee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
section 7.8(a) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into the
Designation Agreement; (D) such designee will, independently and without
reliance upon the Administrative Agent, such designating Lender or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (E) such designee confirms that it is a Designated
Bidder; (F) such designee appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Administrative Agent by the terms hereof,
together with such powers as are reasonably incidental thereto; and (G) such
designee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.
(iii) Upon its receipt of a Designation Agreement executed by a
designating Lender and a designee representing that it is a Designated Bidder,
the Administrative Agent shall, if such Designation Agreement has been properly
completed, (A) accept such Designation Agreement, (B) record the information
contained therein in the Lender Register and (C) give prompt notice thereof to
the Borrower.
(e) No SEC Registration or Blue Sky Compliance. Notwithstanding any
other provisions of this section 12.4, no transfer or assignment of the
interests or obligations of any Lender hereunder or any grant of participation
therein shall be permitted if such transfer, assignment or grant would require
the Borrower to file a registration statement with the SEC or to qualify the
Loans under the "Blue Sky" laws of any State.
(f) Representations of Lenders. Each Lender initially party to this
Agreement hereby represents, and each person that became a Lender pursuant to an
assignment permitted by this section 12.4 will, upon its becoming party to this
Agreement, represent that it is a commercial lender, other financial institution
or other "accredited" investor (as defined in SEC Regulation D) which makes or
acquires loans in the ordinary course of its business and that it will make or
acquire Loans for its own account in the ordinary course of such business,
PROVIDED that subject to the preceding sections 12.4(b), (c) and (d), the
disposition of any promissory notes or other evidences of or interests in
Indebtedness held by such Lender shall at all times be within its exclusive
control.
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(g) Grants by Lenders to SPVs. (i) Notwithstanding anything to the
contrary contained herein, any Lender, (a "DESIGNATING LENDER") may grant to a
special purpose funding vehicle (an "SPV"), identified as such in writing from
time to time by the Designating Lender to the Administrative Agent, the Borrower
and the other Lenders, the option to provide to the Borrower all or any part of
any Loan that such Designating Lender would otherwise be obligated to make to
the Borrower pursuant to this Agreement; PROVIDED that (i) nothing herein shall
constitute a commitment by any SPV to make any Loan, (ii) if an SPV elects not
to exercise such option or otherwise fails to provide all or any part of such
Loan, the Designating Lender shall be obligated to make such Loan pursuant to
the terms hereof, and (iii) the Designating Lender shall remain liable for any
indemnity or other payment obligation with respect to its Commitment hereunder.
The making of a Loan by an SPV hereunder shall utilize the Commitment of the
Designating Lender to the same extent, and as if, such Loan were made by such
Designating Lender.
(ii) As to any Loans or portion thereof made by it, each SPV shall have
all the rights that a Lender making such Loans or portion thereof would have had
under this Agreement; PROVIDED, HOWEVER, that each SPV shall have granted to its
Designating Lender an irrevocable power of attorney, to deliver and receive all
communications and notices under this Agreement (and any other Credit Documents)
and to exercise on such SPV's behalf, all of such SPV's voting rights under this
Agreement. No additional Note shall be required to evidence the Loans or portion
thereof made by an SPV; and the related Designating Lender shall be deemed to
hold its Note as agent for such SPV to the extent of the Loans or portion
thereof funded by such SPV. In addition, any payments for the account of any SPV
shall be paid to its Designating Lender as agent for such SPV.
(iii) Each party hereto hereby agrees that no SPV shall be liable for
any indemnity or payment under this Agreement for which a Lender would otherwise
be liable. In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPV, it will
not institute against, or join any other person in instituting against, such SPV
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof.
(iv) In addition, notwithstanding anything to the contrary contained in
this section 12.4, any SPV may (A) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loans
to the Designating Lender or to any financial institutions providing liquidity
and/or credit support to or for the account of such SPV to support the funding
or maintenance of Loans and (B) disclose on a confidential basis any non-public
information relating to its Loans to any rating agency, commercial paper dealer
or provider of any surety, guarantee or credit or liquidity enhancements to such
SPV. This section 12.4(g) may not be amended without the written consent of any
Designating Lender affected thereby.
12.5. No Waiver: Remedies Cumulative. No failure or delay on the part
of the Administrative Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower and the Administrative Agent or any Lender shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. No notice to or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand. 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 or Event of Default, regardless of whether
the Administrative Agent, any Lender or the Letter of Credit Issuer may have had
notice or knowledge of such Default or Event of Default at the time. The rights
and remedies herein expressly provided are cumulative and not exclusive of any
rights or remedies which the Administrative Agent or any Lender would otherwise
have.
12.6. Payments Pro Rata; Sharing of Setoffs, etc. (a) The
Administrative Agent agrees that promptly after its receipt of each payment from
or on behalf of the Borrower in respect of any Obligations, it shall distribute
such payment to the Lenders (other than any Lender that has expressly waived in
writing its right to receive its pro rata share thereof) pro rata based upon
their respective shares, if any, of the Obligations with respect to which such
payment was received. As to any such payment received by the Administrative
Agent prior to 1:00 P.M. (local time
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at the Payment Office) in funds which are immediately available on such day, the
Administrative Agent will use all reasonable efforts to distribute such payment
in immediately available funds on the same day to the Lenders as aforesaid.
(b) Each of the Lenders agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the General Revolving Loans, Swing Line Revolving Loans, or reimbursement
obligations with respect to Unpaid Drawings, or Fees, of a sum which with
respect to the related sum or sums received by other Lenders is in a greater
proportion than the total of such Obligation then owed and due to such Lender
bears to the total of such Obligation then owed and due to all of the Lenders
immediately prior to such receipt, then such Lender receiving such excess
payment shall purchase for cash without recourse or warranty from the other
Lenders an interest in the Obligations to such Lenders in such amount as shall
result in a proportional participation by all of the Lenders in such amount,
PROVIDED that (i) if all or any portion of such excess amount is thereafter
recovered from such Lender, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest, and (ii)
the provisions of this section 12.6(b) 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 Letters of Credit to any assignee or participant pursuant to
section 12.4, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this section 12.6(b) 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.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding sections 12.6(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Lenders which are not Defaulting Lenders, as opposed to
Defaulting Lenders.
(d) If any Lender shall fail to make any payment required to be made by
it to the Administrative Agent pursuant to section 2.6(b) or 3.4(c), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision of this Agreement), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations to the Administrative Agent under such sections until all such
unsatisfied obligations are fully paid.
12.7. Calculations: Computations. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Lenders); PROVIDED, that if at any time the computations
determining compliance with section 9 utilize accounting principles different
from those utilized in the financial statements furnished to the Lenders, such
computations shall set forth in reasonable detail a description of the
differences and the effect upon such computations.
(b) All computations of interest on Loans hereunder (other than Prime
Rate Loans) and all computations of Facility Fees, Letter of Credit Fees and
other Fees hereunder shall be made on the actual number of days elapsed over a
year of 360 days, and all computations of interest on Prime Rate Loans hereunder
shall be made on the actual number of days elapsed over a year of 365 or 366
days, as applicable.
12.8. Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury
Trial. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF OHIO. TO THE FULLEST
EXTENT PERMITTED BY LAW, THE BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY
WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY JURISDICTION OTHER THAN THE STATE
OF OHIO GOVERNS THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS. Any legal
action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the Court of Common Pleas of Cuyahoga
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County, Ohio, or of the United States for the Northern District of Ohio, and, by
execution and delivery of this Agreement, the Borrower hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Borrower hereby
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to the Borrower at its
address for notices pursuant to section 12.3, such service to become effective
30 days after such mailing or at such earlier time as may be provided under
applicable law. Nothing herein shall affect the right of the Administrative
Agent or any Lender to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against the Borrower in any
other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in section 12.8(a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO HEREBY (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 PARAGRAPH.
12.9. Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same agreement. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
12.10. Effectiveness; Integration. This Agreement shall become
EFFECTIVE ON THE DATE (the "Effective Date") on which the Borrower and each of
the Lenders shall have signed a copy hereof (whether the same or different
copies) and shall have delivered the same to the Administrative Agent at the
Notice Office of the Administrative Agent or, in the case of the Lenders, shall
have given to the Administrative Agent telephonic (confirmed in writing),
written telex or facsimile transmission notice (actually received) at such
office that the same has been signed and mailed to it. This Agreement, the other
Credit Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent, for its own account and benefit and/or for the
account, benefit of, and distribution to, the Lenders, constitute the entire
contract among the parties relating to the subject matter hereof and thereof and
supersede any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof or thereof.
12.11. Headings Descriptive. The headings of the several sections and
other portions of this Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
12.12. Amendment or Waiver. Neither this Agreement nor any terms hereof
or thereof may be changed, waived, discharged or terminated unless such change,
waiver, discharge or termination is in writing signed by the Borrower and the
Required Lenders, PROVIDED that no such change, waiver, discharge or termination
shall, without the consent of each Lender (other than a Defaulting Lender)
affected thereby,
(a) change any date upon which a mandatory and automatic
reduction in any Commitment of such Lender is scheduled to be made, or
change the amount thereof,
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(b) change any date upon which an installment payment of any
Loans made by such Lender is scheduled to be made, or change the amount
thereof,
(c) change any date upon which a reimbursement of an Unpaid
Drawing is scheduled to be made, or reduce the amount thereof, if such
Lender is a Participant with respect thereto;
(d) extend the final scheduled maturity of any Commitment or
Loan of such Lender (it being understood that any waiver of the making
of, or the application of, any mandatory prepayment to such Loans shall
not constitute an extension of the final maturity date thereof),
(e) reduce the rate or extend the time of payment of interest
or Fees on any Loan or Commitment of such Lender (except in connection
with a waiver of the applicability of any post-default increase in
interest rates),
(f) reduce the principal amount of any Loan of any Lender,
(g) increase such Lender's Commitment over the amount thereof
then in effect,
(h) extend the expiration or termination of any Letter of
Credit beyond the scheduled expiration of such Lender's Commitment with
respect thereto,
(i) release the Borrower from any obligations as a guarantor
of its Subsidiaries' obligations under any Credit Document,
(j) release any Credit Party from the Subsidiary Guaranty,
except strictly in accordance with the provisions of the Credit
Documents,
(k) change the definition of the term "Change of Control" or
any of the provisions of section 4.3 or 5.2 which are applicable upon a
Change of Control,
(l) amend, modify or waive any provision of this section
12.12, or section 11.7, 12.1, 12.4, 12.6 or 12.7(b), or any other
provision of any of the Credit Documents pursuant to which the consent
or approval of all Lenders is by the terms of such provision explicitly
required,
(m) reduce the percentage specified in, or otherwise modify,
the definition of Required Lenders, or
(n) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement; and
PROVIDED, FURTHER, that no change, waiver or other modification affecting the
rights and benefits of a Lender and not all Lenders in a like or similar manner,
shall be made without the written consent of such Lender. No provision of
section 3 or 11 may be amended without the consent of (x) any Letter of Credit
Issuer adversely affected thereby or (y) the Administrative Agent, respectively.
12.13. Survival of Indemnities. All indemnities set forth herein
including, without limitation, in section 2.9, 2.10, 3.5, 11.7 or 12.1 shall
survive the execution and delivery of this Agreement and the making and
repayment of Loans.
12.14. Domicile of Loans. Each Lender may transfer and carry its Loans
at, to or for the account of any branch office, subsidiary or affiliate of such
Lender, PROVIDED that the Borrower shall not be responsible for costs arising
under section 2.9 resulting from any such transfer (other than a transfer
pursuant to section 2.11) to the extent not otherwise applicable to such Lender
prior to such transfer.
12.15. Confidentiality. (a) Each of the Administrative Agent, the
Letter of Credit Issuers and the Lenders agrees to maintain the confidentiality
of the Confidential Information (as defined below), except that
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Confidential Information may be disclosed (1) 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 Confidential
Information and instructed to keep such Confidential Information confidential),
(2) to any direct or indirect contractual counterparty in any swap, hedge or
similar agreement (or to any such contractual counterparty's professional
advisor), so long as such contractual counterparty (or such professional
advisor) agrees to be bound by the provisions of this section 12.15, (3) to the
extent requested by any regulatory authority, (4) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, it
being understood and agreed that unless prohibited by law or court order any
such person will use reasonable efforts to advise the Borrower reasonably in
advance of any required disclosure to be made pursuant to subpoena, discovery
proceedings in any litigation or governmental investigation or any court order,
(5) to any other party to this Agreement, (6) to any other creditor of the
Borrower or any other Credit Party which is a direct or intended beneficiary of
any of the Credit Documents, (7) in connection with the exercise of any remedies
hereunder or under any of the other Credit Documents, or any suit, action or
proceeding relating to this Agreement or any of the other Credit Documents or
the enforcement of rights hereunder or thereunder, (8) subject to an agreement
containing provisions substantially the same as those of this section 12.15, to
any assignee of or participant in, or any prospective assignee of or participant
in, any of its rights or obligations under this Agreement, (9) with the consent
of the Borrower, or (10) to the extent such Confidential Information (i) becomes
publicly available other than as a result of a breach of this section 12.15, or
(ii) becomes available to the Administrative Agent, any Letter of Credit Issuer
or any Lender on a nonconfidential basis from a source other than the Borrower
without a duty of confidentiality to the Borrower being violated.
(b) For the purposes of this section 12.15, "CONFIDENTIAL INFORMATION"
means all information received from or on behalf of the Borrower and/or its
Subsidiaries, or obtained by the Administrative Agent, any Letter of Credit
Issuer or any Lender based on an inspection or review of the books and records
of the Borrower and/or its Subsidiaries, relating to the Borrower, its
Subsidiaries or their business, other than any such information that is
available to the Administrative Agent, any Letter of Credit Issuer or any Lender
on a nonconfidential basis prior to disclosure by the Borrower; PROVIDED that,
in the case of information received or obtained from or on behalf of the
Borrower and/or any of its Subsidiaries after the date hereof, such information
is clearly identified at the time of delivery or the time obtained as
confidential.
(c) Any person required to maintain the confidentiality of Confidential
Information as provided in this section 12.15 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 Confidential Information
as such person would accord to its own confidential information. The Borrower
hereby agrees that the failure of the Administrative Agent, any Letter of Credit
Issuer or any Lender to comply with the provisions of this section 12.15 shall
not relieve the Borrower, or any other Credit Party, of any of its obligations
under this Agreement or any of the other Credit Documents.
12.16. Lender Register. The Borrower hereby designates the
Administrative Agent to serve as its agent, solely for purposes of this section
12.16, to maintain a register (the "LENDER REGISTER") on or in which it will
record the names and addresses of the Lenders, and the Commitments from time to
time of each of the Lenders, the Loans made to the Borrower by each of the
Lenders and each repayment and prepayment in respect of the principal amount of
such Loans of each such Lender. Failure to make any such recordation, or (absent
manifest error) any error in such recordation, shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Lender, the transfer
of the Commitment of such Lender and the rights to the principal of, and
interest on, any Loan made pursuant to such Commitment shall not be effective
until such transfer is recorded on the Lender Register maintained by the
Administrative Agent with respect to ownership of such Commitment and Loans and
prior to such recordation all amounts owing to the transferor with respect to
such Commitment and Loans shall remain owing to the transferor. The registration
of assignment or transfer of all or part of any Commitments and Loans shall be
recorded by the Administrative Agent on the Lender Register only upon the
acceptance by the Administrative Agent of a properly executed and delivered
Assignment Agreement pursuant to section 12.4(c). The Borrower agrees to
indemnify the Administrative Agent from and against any and all losses, claims,
damages and liabilities of whatsoever nature which may be imposed on, asserted
against or incurred by the Administrative Agent in performing its duties under
this section 12.16, except to the extent attributable to the gross negligence or
wilful misconduct of the Administrative Agent. The Lender Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
70
<PAGE> 76
12.17. Limitations on Liability of the Letter of Credit Issuers. The
Borrower assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of such Letters of
Credit. Neither any Letter of Credit Issuer nor any of its officers or directors
shall be liable or responsible for: (a) the use which may be made of any Letter
of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; (b) the validity, sufficiency or genuineness of documents,
or of any endorsement thereon, even if such documents should prove to be in any
or all respects invalid, insufficient, fraudulent or forged; (c) payment by a
Letter of Credit Issuer against presentation of documents that do not comply
with the terms of a Letter of Credit, including failure of any documents to bear
any reference or adequate reference to such Letter of Credit; or (d) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit, EXCEPT that the Borrower (or a Subsidiary which is the account party
in respect of the Letter of Credit in question) shall have a claim against a
Letter of Credit Issuer, and a Letter of Credit Issuer shall be liable to the
Borrower (or such Subsidiary), to the extent of any direct, but not
consequential, damages suffered by the Borrower (or such Subsidiary) which the
Borrower (or such Subsidiary) proves were caused by (i) such Letter of Credit
Issuer's willful misconduct or gross negligence in determining whether documents
presented under a Letter of Credit comply with the terms of such Letter of
Credit or (ii) such Letter of Credit Issuer's willful failure to make lawful
payment under any Letter of Credit after the presentation to it of documentation
strictly complying with the terms and conditions of such Letter of Credit. In
furtherance and not in limitation of the foregoing, a Letter of Credit Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation.
12.18. General Limitation of Liability. No claim may be made by the
Borrower, any Lender, the Administrative Agent, any Letter of Credit Issuer or
any other person against the Administrative Agent, any Letter of Credit Issuer,
or any other Lender or the Affiliates, directors, officers, employees, attorneys
or agents of any of them for any damages other than actual compensatory damages
in respect of any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement or
any of the other Credit Documents, or any act, omission or event occurring in
connection therewith; and each of the Borrower, each Lender, the Administrative
Agent and each Letter of Credit Issuer hereby, to the fullest extent permitted
under applicable law, waives, releases and agrees not to sue or counterclaim
upon any such claim for any special, consequential or punitive damages, whether
or not accrued and whether or not known or suspected to exist in its favor.
12.19. No Duty. All attorneys, accountants, appraisers, consultants and
other professional persons (including the firms or other entities on behalf of
which any such person may act) retained by the Administrative Agent or any
Lender with respect to the transactions contemplated by the Credit Documents
shall have the right to act exclusively in the interest of the Administrative
Agent or such Lender, as the case may be, and shall have no duty of disclosure,
duty of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to the Borrower, to any of its Subsidiaries, or to any other person,
with respect to any matters within the scope of such representation or related
to their activities in connection with such representation. The Borrower agrees,
on behalf of itself and its Subsidiaries, not to assert any claim or
counterclaim against any such persons with regard to such matters, all such
claims and counterclaims, now existing or hereafter arising, whether known or
unknown, foreseen or unforeseeable, being hereby waived, released and forever
discharged.
12.20. Lenders and Agent Not Fiduciary to Borrower, etc. The
relationship among the Borrower and its Subsidiaries, on the one hand, and the
Administrative Agent, each Letter of Credit Issuer and the Lenders, on the other
hand, is solely that of debtor and creditor, and the Administrative Agent, each
Letter of Credit Issuer and the Lenders have no fiduciary or other special
relationship with the Borrower and its Subsidiaries, and no term or provision of
any Credit Document, no course of dealing, no written or oral communication, or
other action, shall be construed so as to deem such relationship to be other
than that of debtor and creditor.
12.21. Survival of Representations and Warranties. All representations
and warranties herein shall survive the making of Loans and the issuance of
Letters of Credit hereunder, the execution and delivery of this Agreement, the
Notes and the other documents the forms of which are attached as Exhibits
hereto, the issue and delivery of the Notes, any disposition thereof by any
holder thereof, and any investigation made by the Administrative Agent or any
Lender or any other holder of any of the Notes or on its behalf. All statements
contained in any certificate or other document delivered to the Administrative
Agent or any Lender or any holder of any Notes by or on behalf of the Borrower
or of its Subsidiaries pursuant hereto or otherwise specifically for use in
connection with the transactions contemplated hereby shall constitute
representations and warranties by the Borrower hereunder, made
71
<PAGE> 77
as of the respective dates specified therein or, if no date is specified, as of
the respective dates furnished to the Administrative Agent or any Lender.
12.22. 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.
12.23. Independence of Covenants. All covenants hereunder shall be
given independent effect so that if a particular action, event, condition or
circumstance is not permitted by any of such covenants, the fact that it would
be permitted by an exception to, or would otherwise be within the limitations or
restrictions of, another covenant, shall not avoid the occurrence of a Default
or an Event of Default if such action is taken or event, condition or
circumstance exists.
12.24. No Reliance on Margin Stock. Each Lender represents to the
Administrative Agent and each of the other Lenders that it in good faith is not
relying upon any "margin stock" (as defined in Regulation U) as collateral in
the extension or maintenance of the credit provided for in this Agreement.
12.25. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the "CHARGES"), shall exceed the maximum
lawful rate (the "MAXIMUM RATE") which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Prime Rate to the date of repayment, shall have
been received by such Lender.
72
<PAGE> 78
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date first above
written.
FERRO CORPORATION NATIONAL CITY BANK,
individually as a Lender and as the
Letter of Credit Issuer, and in its
capacity as the Lead Arranger and
the Administrative Agent
By:
----------------------------
D. Thomas George
Treasurer
By:
----------------------------
Terri L. Cable
Senior Vice President
KEYBANK NATIONAL ASSOCIATION, BANK ONE, MICHIGAN,
individually as a Lender and individually as a Lender and as
as Syndication Agent Documentation Agent
By: By:
------------------------------ ----------------------------
Title: Title:
FLEET NATIONAL BANK CITIBANK, N. A.
By: By:
------------------------------ ----------------------------
Title: Title:
FIFTH THIRD BANK, NORTHEASTERN OHIO MELLON BANK, N. A.
By: By:
------------------------------ ----------------------------
Title: Title:
73
<PAGE> 79
ANNEX I
<TABLE>
<CAPTION>
INFORMATION AS TO LENDERS
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
National City Bank National City Bank National City Bank
GENERAL 1900 East Ninth Street 1900 East Ninth Street
REVOLVING Cleveland, Ohio 44114 Cleveland, Ohio 44114
COMMITMENT:
PRIMARY CONTACT:
$80,000,000 Terri L. Cable
Senior Vice President
Telephone: (216) 575-3354
SWING LINE Facsimile: (216) 222-0003
REVOLVING
COMMITMENT: CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Connie B. Djukic
$10,000,000 Money Desk Officer
Telephone: (216) 575-2578
Facsimile: (216) 575-2481
LETTER OF CREDIT CONTACT:
Nicole Piccolo
Letter of Credit Coordinator
23000 Millcreek Blvd. #7532
Highland Hills, Ohio 44122
Tel. (216) 488-7547
Fax. (216) 488-7550
WIRING INFORMATION:
ABA No. 041 000 124
Ref.: Ferro Corporation
Attention: Commercial Loan
Operations Large Corporate
Processing
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 80
<TABLE>
<CAPTION>
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
Bank One, Michigan Bank One, Michigan Bank One, Michigan
GENERAL 611 Woodward Avenue 611 Woodward Avenue
REVOLVING Detroit, Michigan 48226 Detroit, Michigan 48226
COMMITMENT:
PRIMARY CONTACTS:
$50,000,000 Babette Coerdt
First Vice President
600 Superior Avenue
Cleveland, Ohio 44114
Tel. (216) 261-2226
Fax. (216) 348-6642
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Karen Graham
Tel. (313) 225-2579
Fax. (313) 225-1586
WIRING INFORMATION:
ABA No. 072 000 326
a/c # 2891000007
Ref.: Ferro Corporation
LS2 Clearing Account
Attention: Commercial Loan
Operations
- -----------------------------------------------------------------------------------------------------------------------------
KeyBank National KeyBank National Association KeyBank National Association
Association GENERAL 127 Public Square 127 Public Square
REVOLVING Cleveland, Ohio 44114 Cleveland, Ohio 44114
COMMITMENT:
PRIMARY CONTACTS:
$50,000,000 Brendan Lawlor
Vice President
Tel. : (216) 689-5642
Fax. : (216) 689-4981
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Elise Jackson
Tel. (216) 689-0206
Fax. (216) 689-4981
WIRING INFORMATION:
ABA No. 041 001 039
a/c # 3057
Ref.: Ferro Corporation
Attention: Commercial Loan Operations
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 81
<TABLE>
<CAPTION>
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
Citibank, N. A. Citibank, N. A. Citibank, N. A.
GENERAL 399 Park Avenue 399 Park Avenue
REVOLVING New York, New York 10043 New York, New York 10043
COMMITMENT:
PRIMARY CONTACTS:
$35,000,000 Diane Pockaj
Vice President
Tel.: (212) 559-4649
Fax.: (212) 773-0289
Jeff Stern
Assistant Vice President
Tel.: (212) 559-5089
Fax.: (212) 773-0289
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Cindy Mark
Manager
Two Penns Way
New Castle, Del. 19720
Tel. (302) 894-6083
Fax (302) 894-6090
WIRING INFORMATION:
ABA No. 021 000 89
a/c # 4054-8046
Ref.: Ferro Corporation
Attention: Commercial Loan
Operations
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 82
<TABLE>
<CAPTION>
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
Fleet National Bank Fleet National Bank Fleet National Bank
GENERAL 100 Federal Street 100 Federal Street
REVOLVING Boston, Massachusetts 02110 Boston, Massachusetts 02110
COMMITMENT:
PRIMARY CONTACTS:
$35,000,000 Bob MacElhiney
Vice President
Tel. (617) 434-7068
Fax (617) 434-0816
Suzanne Chomiczewski
Tel. (617) 434-3325
Fax (617) 434-0816
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Shrago, Halise
Tel. (781) 467-2169
Fax (781) 467-2167
WIRING INFORMATION:
ABA No. 011 000 390
Ref.: Ferro Corporation
Attention: Commercial Loan
Operations
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE> 83
<TABLE>
<CAPTION>
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
Fifth Third Bank, Fifth Third Bank, Northeastern Ohio Fifth Third Bank, Northeastern Ohio
Northeastern Ohio GENERAL 1404 East Ninth Street 1404 East Ninth Street
REVOLVING Cleveland, Ohio 44114 Cleveland, Ohio 44114
COMMITMENT:
PRIMARY CONTACTS:
$25,000,000 Jim Byrnes
Vice President
Tel. (216) 274-5575
Fax. (216) 274-5507
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Vel Woods
Tel. (216) 274-5578
Fax (216) 274-5507
CONTACT FOR LETTER OF CREDIT:
Tim McGuire
Tel. (216) 274-5480
Fax (216) 274-5507
WIRING INFORMATION:
Fifth Third Bank, Cincinnati Ohio
ABA No. 042 000 314
a/c # 99208599
Benef: C/O Fifth Third Bank,
Northeastern Ohio
Ref.: Ferro Corporation
Attention: Commercial Loan
Operations
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE> 84
<TABLE>
<CAPTION>
=============================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
=============================================================================================================================
<S> <C> <C> <C>
Mellon Bank, N. A. Mellon Bank, N. A. Mellon Bank, N. A.
GENERAL One Mellon Center One Mellon Center
REVOLVING Pittsburgh, Pennsylvania 15258 Pittsburgh, Pennsylvania 15258
COMMITMENT:
PRIMARY CONTACTS:
$25,000,000 Charles Frankenberry
Vice President
Tel.: (412) 236-1643
Fax.: (412) 234-8888
CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
LETTER OF CREDIT CONTACT:
WIRING INFORMATION:
ABA No. 043 000 261
a/c #
Ref.: Ferro Corporation
Attention: Commercial Loan
Operations
=============================================================================================================================
</TABLE>
6
<PAGE> 85
ANNEX II
INFORMATION AS TO SUBSIDIARIES
<TABLE>
<CAPTION>
Sovereign power under
Name of Subsidiary the laws of which organized
- ------------------------------ ---------------------------
<S> <C>
Ferro Electronic Materials, Inc. USA
Ferro Industrial Products Ltd. Canada
Ferro B. V. The Netherlands
Ferro (Holland) B. V. The Netherlands
Ferro France S.a.R.L. France
Ferro Chemicals S. A. France
Ruhr-Pulverlack GmbH Germany
Ferro (Deutschland) GmbH Germany
Ferro (Italia) S.R.L. Italy
Ferro Industrias-Quimacas S. A. Portugal
Ferro Toyo Co., Ltd. (60%) Taiwan, ROC
Ferro Enamel Espanola S. A. Spain
Ege-FerroKimya A.S. (49.9%) Turkey
Ferro (Great Britain) Ltd. United Kingdom
Ferro Enamel Argentina S.A.I.Cy.M. Argentina
Minera Loma Blanca S. A. Argentina
Procesadora de Boratos Argentinos S. A. (50%) Argentina
Ferro Enamel do Brasil, I.C.L. Brasil
Ferro Mexicana S.A.deC.V. Mexico
Ferro de Venezuela C.A. (51%) Venezuela
Ferro Corporation (Australia) Pty. Ltd. Australia
Ferro Far East, Ltd. Peoples Republic of China
Ferro (Ningho) Powder Coatings, Ltd. Peoples Republic of China
Ferro Industrial Products Limited (Taiwan) Taiwan, ROC
Ferro (Thailand) Co., Ltd. (49%) Thailand
Ferro Japan K.K. Japan
PT Ferro Mas Dinamika (95%) Indonesia
</TABLE>
- -------------
* Percentages in parentheses indicate Ferro's ownership. Ferro has a
number of sales and warehousing subsidiaries throughout the world
which are omitted from the foregoing because they are considered in
the aggregate or individually not to constitute a significant
subsidiary.
<PAGE> 86
ANNEX III
DESCRIPTION OF EXISTING INDEBTEDNESS
(as of March 31, 2000)
<TABLE>
<S> <C> <C>
LONG TERM DEBT OF PARENT COMPANY
PUBLICLY HELD DEBT
7.625% Debentures due May 2013 $25,000,000
8% Debentures due June 2025 $50,000,000
7.375% Debentures due October 2015 $25,000,000
7.125% Debentures due March 2028 $55,000,000 $155,000,000
REVOLVING CREDIT AGREEMENT BORROWINGS $ 95,000,000
-----------------------------------------
Parent Co. Long-Term Debt $250,000,000
-----------------------------------------
-----------------------------------------
Subsidiary Long-Term Debt $2,515,573*
-----------------------------------------
*Reported only as of year-end (12/31/99).
SHORT-TERM DEBT OF PARENT COMPANY
Money Market Borrowings
(generally less than 1 month maturity) $17,500,000
SECURED LONG-TERM DEBT
International Subsidiaries $1,842,583
[Included above in Subsidiary
Long-Term Debt]
-----Continued on Next Page-----
</TABLE>
<PAGE> 87
- --------------------------
GUARANTEES
- --------------------------
<TABLE>
<CAPTION>
=======================================================================================================================
Subsidiary Requesting Bank Date of Amount of Current USD Date of Board Maximum Amount of
Guaranty Guaranty Issued Equivalent Authorization Board Authorization
=======================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
PT Ferro Mas Citibank 4/27/1999 USD5,000,000 $5,000,000 9/3/92 $4,000,000
Dinamika 4/23/93 $1,000,000
(Indonesia) ($10MM Blanket)
- -----------------------------------------------------------------------------------------------------------------------
Ferro Industrial Citibank 9/29/1998 USD$1,500,000 $1,500,000 4/27/90 $3,600,000
Products Ltd. (TWD120,000,000)
- -----------------------------------------------------------------------------------------------------------------------
Ferro (Thailand) Citibank 7/15/1996 USD$2,500,000 $2,500,000 8/15/93 $3,550,000
Co., Ltd.
- -----------------------------------------------------------------------------------------------------------------------
TOTALS $9,000,000 $11,150,000
=======================================================================================================================
</TABLE>
- --------------------------
COMFORT LETTERS
- --------------------------
<TABLE>
<CAPTION>
=======================================================================================================================
Subsidiary Requesting Bank Date of Comfort Amount of Current USD Date of Board Maximum Amount of
Letter Guaranty Issued Equivalent Authorization Board Authorization
=======================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Ferro Far East Citibank July 28, 1993 HKD6,000,000 $775,000 7/19/85 $1,900,000
Limited (Hong reaffirmed
Kong) 11/11/96 and
10/22/97
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
=======================================================================================================================
</TABLE>
- --------------------------
SYNTHETIC LEASE
A five year lease entered into in 1995 in connection with the Synthetic Products
Company acquisition, under which the Borrower has the opportunity to purchase
the leased assets at the end of the lease term for approximately $29.6 million
- --------------------------
<PAGE> 88
ANNEX IV
DESCRIPTION OF LETTERS OF CREDIT DEEMED ISSUED UNDER
THE CREDIT AGREEMENT
<PAGE> 89
EXHIBIT A-1
GENERAL REVOLVING NOTE
$________________ Cleveland, Ohio
____________, 2000
FOR VALUE RECEIVED, the undersigned FERRO CORPORATION, an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _______________________ (the "LENDER"),
in lawful money of the United States of America and in immediately available
funds, at the Payment Office (such term and certain other terms used herein
without definition shall have the meanings ascribed thereto in the Credit
Agreement referred to below) of National City Bank (the "ADMINISTRATIVE AGENT"),
the principal sum of ________________ DOLLARS AND ____ CENTS ($ ) or, if less,
the then unpaid principal amount of all General Revolving Loans made by the
Lender to the Borrower pursuant to the Credit Agreement, on the Maturity Date.
The Borrower promises also to pay interest in like currency and funds
at the Payment Office on the unpaid principal amount of each General Revolving
Loan made by the Lender from the date of such General Revolving Loan until paid
at the rates and at the times provided in section 2.7 of the Credit Agreement.
This Note is one of the General Revolving Notes referred to in the
Credit Agreement, dated as of May 9, 2000, among the Borrower, the financial
institutions from time to time party thereto (including the Lender), and
National City Bank, as Administrative Agent (as from time to time in effect, the
"CREDIT AGREEMENT"), and is entitled to the benefits thereof and of the other
Credit Documents. As provided in the Credit Agreement, this Note is subject to
mandatory prepayment prior to the Maturity Date, in whole or in part.
In case an Event of Default shall occur and be continuing, the
principal of and accrued interest on this Note may be declared to be due and
payable in the manner and with the effect provided in the Credit Agreement.
The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note. No failure to exercise, or delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of any such rights.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF OHIO.
FERRO CORPORATION
By: _____________________________
Title:
<PAGE> 90
LOANS AND PAYMENTS OF PRINCIPAL
<TABLE>
<CAPTION>
====================================================================================================================
AMOUNT
OF
DATE AMOUNT TYPE PRINCIPAL UNPAID
OF OF OF INTEREST PAID OR PRINCIPAL MADE
NOTATION LOAN LOAN PERIOD PREPAID BALANCE BY
====================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
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- --------------------------------------------------------------------------------------------------------------------
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====================================================================================================================
</TABLE>
<PAGE> 91
EXHIBIT A-2
SWING LINE REVOLVING NOTE
$________________ Cleveland, Ohio
_________, 2000
FOR VALUE RECEIVED, the undersigned FERRO CORPORATION, an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _______________________ (the "LENDER"),
in lawful money of the United States of America and in immediately available
funds, at the Payment Office (such term and certain other terms used herein
without definition shall have the meanings ascribed thereto in the Credit
Agreement referred to below) of National City Bank (the "ADMINISTRATIVE AGENT"),
the principal sum of ________________ DOLLARS AND ____ CENTS ($ ) or, if less,
the then unpaid principal amount of all Swing Line Revolving Loans made by the
Lender to the Borrower pursuant to the Credit Agreement. The Borrower will pay
the principal amount of any Swing Line Revolving Loan on the maturity date
specified therefor in the Notice of Borrowing relating thereto, which maturity
date shall in no event be more than 30 days following the date such Swing Line
Revolving Loan was made.
The Borrower promises also to pay interest in like currency and funds
at the Payment Office on the unpaid principal amount of each Swing Line
Revolving Loan made by the Lender from the date of such Swing Line Revolving
Loan until paid at the rates and at the times provided in section 2.7 of the
Credit Agreement.
This Note is the Swing Line Revolving Note referred to in the Credit
Agreement, dated as of May 9, 2000, among the Borrower, the financial
institutions from time to time party thereto (including the Lender), and
National City Bank, as Administrative Agent (as from time to time in effect, the
"CREDIT AGREEMENT"), and is entitled to the benefits thereof and of the other
Credit Documents. As provided in the Credit Agreement, this Note is subject to
mandatory prepayment prior to the maturity date of any Swing Line Revolving
Loan, in whole or in part.
In case an Event of Default shall occur and be continuing, the
principal of and accrued interest on this Note may be declared to be due and
payable in the manner and with the effect provided in the Credit Agreement.
The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note. No failure to exercise, or delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of any such rights.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF OHIO.
FERRO CORPORATION
By: ______________________________
Title:
<PAGE> 92
LOANS AND PAYMENTS OF PRINCIPAL
<TABLE>
<CAPTION>
====================================================================================================================
TYPE AMOUNT
OF OF
DATE AMOUNT LOAN/ OR MATURITY PRINCIPAL UNPAID
OF OF INTEREST PAID OR PRINCIPAL MADE
NOTATION LOAN RATE PREPAID BALANCE BY
====================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
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====================================================================================================================
</TABLE>
<PAGE> 93
EXHIBIT A-3
COMPETITIVE BID NOTE
$________________ Cleveland, Ohio
_________, 2000
FOR VALUE RECEIVED, the undersigned FERRO CORPORATION, an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _______________________ (the "LENDER"),
in lawful money of the United States of America and in immediately available
funds, at the Payment Office (such term and certain other terms used herein
without definition shall have the meanings ascribed thereto in the Credit
Agreement referred to below) of National City Bank (the "ADMINISTRATIVE AGENT"),
the principal sum of ________________ DOLLARS AND ____ CENTS ($ ) or, if less,
the then unpaid principal amount of all Competitive Bid Loans made by the Lender
to the Borrower pursuant to the Credit Agreement. The Borrower will pay the
principal amount of any Competitive Bid Loan on the maturity date specified
therefor in the Notice of Borrowing relating thereto, which maturity date shall
in no event be more than six months following the date such Competitive Bid was
made.
The Borrower promises also to pay interest in like currency and funds
at the Payment Office on the unpaid principal amount of each Competitive Bid
Loan made by the Lender from the date of such Competitive Bid Loan until paid at
the rates and at the times provided in section 2.7 of the Credit Agreement.
This Note is one of the Competitive Bid Notes referred to in the Credit
Agreement, dated as of May 9, 2000, among the Borrower, the financial
institutions from time to time party thereto (including the Lender), and
National City Bank, as Administrative Agent (as from time to time in effect, the
"CREDIT AGREEMENT"), and is entitled to the benefits thereof and of the other
Credit Documents. As provided in the Credit Agreement, this Note is subject to
mandatory prepayment prior to the maturity date of any Competitive Bid Loan
evidenced hereby, in whole or in part.
In case an Event of Default shall occur and be continuing, the
principal of and accrued interest on this Note may be declared to be due and
payable in the manner and with the effect provided in the Credit Agreement.
The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note. No failure to exercise, or delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of any such rights.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW OF THE STATE OF OHIO.
FERRO CORPORATION
By: ______________________________
Title:
<PAGE> 94
LOANS AND PAYMENTS OF PRINCIPAL
<TABLE>
<CAPTION>
====================================================================================================================
TYPE AMOUNT
OF OF
DATE AMOUNT LOAN/ OR MATURITY PRINCIPAL UNPAID
OF OF INTEREST PAID OR PRINCIPAL MADE
NOTATION LOAN RATE PREPAID BALANCE BY
====================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
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====================================================================================================================
</TABLE>
<PAGE> 95
EXHIBIT B-1
NOTICE OF REVOLVING BORROWING
[Date]
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Loan Operations--Agency Services
RE: NOTICE OF REVOLVING BORROWING UNDER THE CREDIT AGREEMENT,
DATED AS OF MAY 9, 2000
Ladies and Gentlemen:
The undersigned, Ferro Corporation (the "BORROWER"), refers to the
Credit Agreement, dated as of May 9, 2000 (as amended from time to time, the
"CREDIT AGREEMENT", the terms defined therein being used herein as therein
defined), among the Borrower, the financial institutions from time to time party
thereto (the "LENDERS"), and National City Bank, as Administrative Agent for
such Lenders, and hereby gives you notice, irrevocably, pursuant to section
2.2(a) of the Credit Agreement, that the undersigned hereby requests one or more
Revolving Borrowings under the Credit Agreement, and in that connection sets
forth in the schedule attached hereto the information relating to each such
Borrowing (collectively the "PROPOSED BORROWING") as required by section 2.2(a)
of the Credit Agreement.
The undersigned hereby specifies that the Proposed Borrowing will
consist of Loans as indicated in the schedule attached hereto.
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are
and will be true and correct in all material respects, before and after
giving effect to the Proposed Borrowing and to the application of the
proceeds thereof, as though made on such date, except to the extent
that such representations and warranties expressly relate to an earlier
specified date, in which case such representations and warranties were
true and correct in all material respects as of the date when made; and
(B) no Default or Event of Default has occurred and is
continuing, or would result from such Proposed Borrowing or from the
application of the proceeds thereof.
Very truly yours,
FERRO CORPORATION
By: ______________________________
Title:
<PAGE> 96
BORROWING SCHEDULE
PROPOSED BORROWING #1:
<TABLE>
<CAPTION>
====================================================================================================================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE IF LOANS ARE
PROPOSED FACILITY TYPE OF AMOUNT LIBOR
BORROWING LOANS OF LOANS LOANS
====================================================================================================================
<S> <C> <C> <C> <C>
General Revolving Prime Rate Loans One Month
______, 20____ Loans
LIBOR Loans $____________ Two Months
Swing Line Revolving Money Market Rate Three Months
Loans Loans with an interest
rate of ___% and a Six Months
maturity of ___ days
[not more than 30 days]
[Circle one of [Circle one of
above] [Circle and/or above]
complete one of
above]
====================================================================================================================
</TABLE>
PROPOSED BORROWING #2:
<TABLE>
<CAPTION>
======================== ====================== ======================== ==================== ======================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE IF LOANS ARE
PROPOSED FACILITY TYPE OF AMOUNT LIBOR
BORROWING LOANS OF LOANS LOANS
====================================================================================================================
<S> <C> <C> <C> <C>
General Revolving Prime Rate Loans One Month
______, 20____ Loans
LIBOR Loans $____________ Two Months
Swing Line Revolving Money Market Rate Three Months
Loans Loans with an interest
rate of ___% and a Six Months
maturity of ___ days
[not more than 30 days] [Circle one of
[Circle one of above]
above] [Circle and/or
complete one of
above]
====================================================================================================================
</TABLE>
<PAGE> 97
EXHIBIT B-2
NOTICE OF COMPETITIVE BID BORROWING
[Date]
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Loan Operations--Agency Services
RE: NOTICE OF COMPETITIVE BID BORROWING
UNDER THE CREDIT AGREEMENT, DATED AS OF MAY 9, 2000
Ladies and Gentlemen:
The undersigned, Ferro Corporation (the "BORROWER"), refers to the
Credit Agreement, dated as of May 9, 2000 (as amended from time to time, the
"CREDIT AGREEMENT", the terms defined therein being used herein as therein
defined), among the Borrower, the financial institutions from time to time party
thereto (the "LENDERS"), and National City Bank, as Administrative Agent for
such Lenders, and hereby gives you notice, irrevocably, pursuant to section
2.3(a) of the Credit Agreement, that the undersigned hereby requests a
Competitive Bid Borrowing under the Credit Agreement, and in that connection
sets forth the terms on which such Competitive Bid Borrowing (the "PROPOSED
BORROWING") is requested to be made:
<TABLE>
<S> <C> <C>
(A) Date of Proposed Borrowing: __________________________.
(B) Amount of Proposed Borrowing: $_______________.
(C) Maturity Date: [1], [2], [3] or [6] Months.
(D) Interest Rate Basis: [Fixed Rate] or [Margin over Adjusted LIBO Rate].
(E) Interest Payment Date(s): _________________________.
(F) Default Interest Rate: ___% above the Interest Rate.
(G) _____________________: ________________________.
(H) _____________________: ________________________.
</TABLE>
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are
and will be true and correct in all material respects, before and after
giving effect to the Proposed Borrowing and to the application of the
proceeds thereof, as though made on such date, except to the extent
that such representations and warranties expressly relate to an earlier
specified date, in which case such representations and warranties were
true and correct in all material respects as of the date when made; and
(B) no Default or Event of Default has occurred and is
continuing, or would result from such Proposed Borrowing or from the
application of the proceeds thereof.
Very truly yours,
FERRO CORPORATION
By: _____________________________
Title:
<PAGE> 98
EXHIBIT B-3
NOTICE OF CONVERSION
[Date]
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Loan Operations-Agency Services
RE: NOTICE OF CONVERSION OF GENERAL REVOLVING LOANS OF ONE TYPE
INTO ANOTHER TYPE, PURSUANT TO THE CREDIT AGREEMENT,
DATED AS OF MAY 9, 2000
Ladies and Gentlemen:
The undersigned, Ferro Corporation (the "BORROWER"), refers to the
Credit Agreement, dated as of May 9, 2000 (as amended from time to time, the
"CREDIT AGREEMENT", the terms defined therein being used herein as therein
defined), among the Borrower, the financial institutions from time to time party
thereto (the "LENDERS"), and National City Bank, as Administrative Agent for
such Lenders, and hereby gives you notice, irrevocably, pursuant to section 2.5
of the Credit Agreement, that the undersigned hereby requests one or more
Conversions of General Revolving Loans, outstanding pursuant to a Borrowing and
consisting of one Type of Loan, into General Revolving Loans of another Type,
pursuant to section 2.5 of the Credit Agreement, and in that connection sets
forth in the schedule attached hereto the information relating to each such
Conversion.
Very truly yours,
FERRO CORPORATION
By: ______________________________
Title:
<PAGE> 99
CONVERSION SCHEDULE
PROPOSED CONVERSION #1
[OF THE GENERAL REVOLVING LOANS DESCRIBED IN THE FIRST TABLE BELOW INTO
THE GENERAL REVOLVING LOANS DESCRIBED IN THE SECOND TABLE BELOW]
<TABLE>
<CAPTION>
====================================================================================================================
AGGREGATE INTEREST PERIOD
AMOUNT IF LOANS ARE
DATE OF LOANS TYPE OF LOANS OF LOANS LIBOR LOANS
====================================================================================================================
<S> <C> <C> <C>
One Month
____, 20__ Prime Rate Loans
$________ Two Months
LIBOR Loans
Three Months
[Circle one of Six Months
Above]
[Circle one of
above]
====================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================
AGGREGATE INTEREST PERIOD
AMOUNT IF LOANS ARE
DATE OF LOANS TYPE OF LOANS OF LOANS LIBOR LOANS
====================================================================================================================
<S> <C> <C> <C>
One Month
____, 20__ Prime Rate Loans
$________ Two Months
LIBOR Loans
Three Months
[Circle one of Six Months
Above]
[Circle one of
above]
====================================================================================================================
</TABLE>
<PAGE> 100
PROPOSED CONVERSION #2
[OF THE GENERAL REVOLVING LOANS DESCRIBED IN THE FIRST TABLE BELOW INTO
THE GENERAL REVOLVING LOANS DESCRIBED IN THE SECOND TABLE BELOW]
<TABLE>
<CAPTION>
====================================================================================================================
AGGREGATE INTEREST PERIOD
AMOUNT IF LOANS ARE
DATE OF LOANS TYPE OF LOANS OF LOANS LIBOR LOANS
====================================================================================================================
<S> <C> <C> <C>
One Month
____, 20__ Prime Rate Loans
$________ Two Months
LIBOR Loans
Three Months
[Circle one of Six Months
Above]
[Circle one of
above]
====================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================
AGGREGATE INTEREST PERIOD
AMOUNT IF LOANS ARE
DATE OF LOANS TYPE OF LOANS OF LOANS LIBOR LOANS
====================================================================================================================
<S> <C> <C> <C>
One Month
____, 20__ Prime Rate Loans
$________ Two Months
LIBOR Loans
Three Months
[Circle one of Six Months
Above]
[Circle one of
above]
====================================================================================================================
</TABLE>
2
<PAGE> 101
EXHIBIT B-4
LETTER OF CREDIT REQUEST
No. ______________1
Dated __________2
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: International Department/ Letter of Credit Operations
Ladies and Gentlemen:
The undersigned, Ferro Corporation (the "BORROWER"), refers to the
Credit Agreement, dated as of May 9, 2000 (as amended, modified or supplemented
from time to time, the "CREDIT AGREEMENT", the capitalized terms defined therein
being used herein as therein defined), among the Borrower, the financial
institutions from time to time party thereto (the "LENDERS"), and National City
Bank, as Administrative Agent for such Lenders.
The undersigned hereby requests that , as a Letter of Credit Issuer,
issue a Letter of Credit on __________, 20__ (the "DATE OF ISSUANCE") in the
aggregate amount of U.S.$ , for the account of [the Borrower]
[named Subsidiary].
The beneficiary of the requested Letter of Credit will be ___________
________,3 and such Letter of Credit will be in support of ___________
_________ 4 and will have a stated termination date of ____________.5
The undersigned hereby certifies that after giving effect to the
requested issuance of the Letter of Credit:
(i) $_________ principal amount of Loans will be
outstanding; and
(ii) the Letter of Credit Outstandings will be $___________.
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the Date of Issuance:
(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are
and will be true and correct in all material respects, before and after
- --------
1 Letter of Request Number.
2 Date of Letter of Request (at least five Business Days prior to the
Date of Issuance or such lesser number as may be agreed by the relevant
Letter of Credit Issuer).
3 Insert name and address of beneficiary.
4 Insert description of the supported obligations, name of agreement
and/or the commercial transaction to which this Letter of Credit
Request relates.
5 Insert last date upon which drafts may be presented (which may not be
beyond the 15th Business Day next preceding the Maturity Date).
<PAGE> 102
giving effect to the Proposed Borrowing and to the application of the
proceeds thereof, as though made on such date, except to the extent
that such representations and warranties expressly relate to an earlier
specified date, in which case such representations and warranties were
true and correct in all material respects as of the date when made; and
(B) no Default or Event of Default has occurred and is
continuing, or would result after giving effect to the issuance of the
Letter of Credit requested hereby.
Copies of all documentation with respect to the supported transaction
are attached hereto.
Very truly yours,
FERRO CORPORATION
By: ____________________________________
Title:
2
<PAGE> 103
EXHIBIT C
---------------------------
FORM OF
SUBSIDIARY GUARANTY
---------------------------
<PAGE> 104
EXHIBIT D
---------------------------
FORM OF
OPINION OF SPECIAL COUNSEL
TO THE BORROWER
---------------------------
<PAGE> 105
April __, 2000
The Administrative Agent
and each of the Lenders party to the
Credit Agreement referred to below
c/o National City Bank
1900 East Ninth Street
Cleveland, Ohio 44114
RE: CREDIT AGREEMENT, DATED AS OF MAY 9, 2000,
WITH FERRO CORPORATION
Ladies and Gentlemen:
We have acted as special counsel to Ferro Corporation, an Ohio
corporation (the "BORROWER"), in connection with (i) the execution and delivery
of the Credit Agreement, dated as of May 9, 2000 (the "CREDIT AGREEMENT"), among
the Borrower, the financial institutions party thereto (the "LENDERS") and
National City Bank, as Administrative Agent, and (ii) the transactions
contemplated thereby. Unless otherwise indicated, capitalized terms used herein
but not otherwise defined herein shall have the respective meanings set forth in
the Credit Agreement. This opinion letter is delivered by us to you at the
request of the Borrower in accordance with the requirements of section 6.1(f) of
the Credit Agreement.
As such special counsel, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of such documents,
records and matters of law as we have considered necessary as a basis for the
opinions set forth herein, including without limitation the following:
(a) the Credit Agreement; and
(b) the General Revolving Notes in the aggregate principal
amount of $300,000,000, the Swing Line Revolving Note in the principal
amount of $10,000,000, and the Competitive Bid Notes, in each case
which are being delivered today to the Lenders pursuant to the Credit
Agreement.
The documents referred to in clauses (a) and (b) above are herein sometimes
referred to as the "CREDIT DOCUMENTS".
In our examination we have assumed the genuineness of all signatures
(other than as to the Borrower), the authenticity of all documents submitted to
us as originals, the conformity to original documents of all documents submitted
to us as certified or photostatic copies and the authenticity of the originals
of such copies. As to questions of fact not independently verified by us we have
relied, to the extent we deemed appropriate, upon representations and
certificates of officers of the Borrower, public officials and other appropriate
persons. All assumptions and statements of reliance as to factual matters herein
have been made without any independent investigation or verification on our part
except to the extent otherwise expressly stated, and we express no opinion with
respect to the subject matter or accuracy of such assumptions or items relied
upon. We have also assumed the due authorization, execution and delivery of the
Credit Documents on the part of the Lenders and the Administrative Agent, and
the legality, validity, binding effect on, and enforceability of the Credit
Documents against, the Lenders and the Administrative Agent.
We understand that you have considered the applicability of fraudulent
transfer laws to the transactions contemplated by the Credit Documents, as to
which laws we express no opinion, and have satisfied yourself with respect
thereto.
Our examination of matters of law in connection with the opinions
expressed herein has been limited to the federal laws of the United States and
the laws of the State of Ohio, and accordingly, no opinions expressed herein
shall be deemed to cover any other laws.
<PAGE> 106
We have neither examined nor requested an examination of the indices or
records of any court or governmental or other agency, authority, instrumentality
or entity, nor have we made inquiry of any person or entity, except as expressly
set forth in this opinion letter. In addition, we have not independently
verified or investigated the accuracy or completeness of any factual information
and, because the scope of our examination did not include such verification, we
assume no responsibility for the accuracy or completeness of any such
information.
As used herein, "to our knowledge" shall mean to the actual knowledge
of the lawyers who have been actively involved in the negotiation of the Credit
Documents and the lawyers in our firm who are the current primary contacts for
the Borrower at the firm.
Based upon the foregoing and subject to the qualifications, assumptions
and limitations contained in this opinion letter, we are of the opinion that:
1. CORPORATE STATUS, ETC. The Borrower is a validly existing
Ohio corporation and has the corporate power and authority to own its
property and assets and to transact the business in which it is
engaged.
2. QUALIFICATION AS A FOREIGN CORPORATION. Based solely on
certificates received as of recent dates from the Secretary of State or
other appropriate governmental official of _____, _____, _____, _____,
_____, _____, and _____, the Borrower was, as of the date of the
applicable certificate, duly qualified as a foreign corporation and in
good standing in each such jurisdiction.
3. SUBSIDIARIES. To our knowledge, Annex II to the Credit
Agreement correctly sets forth each Subsidiary of the Borrower and the
direct and indirect ownership interest of the Borrower therein.
4. CORPORATE POWER AND AUTHORITY, ETC. The Borrower has the
corporate power and authority to execute, deliver and carry out the
terms and provisions of the Credit Documents to which it is a party and
has taken all necessary corporate action to authorize the execution,
delivery and performance of the Credit Documents to which it is a
party.
5. EXECUTION AND DELIVERY OF CREDIT DOCUMENTS. The Borrower
has duly executed and delivered each Credit Document to which it is a
party.
6. ENFORCEABILITY OF CREDIT DOCUMENTS. The Credit Agreement
and the Notes each constitutes the legal, valid and binding agreement
or obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, except to the extent that the enforceability
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws, and
related judicial doctrines, from time to time in effect affecting
creditors' rights and remedies generally, general principles of equity
(including, without limitation, standards of materiality, good faith,
fair dealing and reasonableness, equitable defenses and limits on the
availability of equitable remedies), whether such principles are
considered in a proceeding at law or in equity, and the qualification
that certain other provisions of such Credit Documents may be
unenforceable in whole or in part under the laws (including judicial
decisions) of the State of Ohio or other applicable jurisdictions, but
the inclusion of such provisions does not affect the validity as
against any Credit Party of any of such Credit Documents as a whole,
and such Credit Documents contain adequate provisions for enforcing
payment of the obligations governed thereby and for the realization of
the principal rights and benefits afforded thereby, subject to the
other qualifications and limitations contained in this opinion letter.
7. NO VIOLATION. Neither the execution, delivery or
performance by the Borrower of the Credit Documents to which it is a
party nor compliance with the terms and provisions thereof, will
contravene any provision of any State of Ohio or United States federal
law, statute, rule, regulation (including, without limitation,
Regulations T, U and X of the Board of Governors of the Federal Reserve
System), or, to our knowledge, any order, writ, injunction or decree of
any court or governmental instrumentality applicable to the Borrower or
its properties and assets, will conflict with or result in any breach
of, any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result
2
<PAGE> 107
in the creation or imposition of (or the obligation to create or
impose) any Lien upon any of the property or assets of the Borrower or
its Subsidiaries pursuant to the terms of any material indenture,
mortgage, deed of trust, agreement or other instrument of which we have
knowledge to which the Borrower or any of its Subsidiaries is a party
or by which it or any of its property or assets are bound or to which
it may be subject or will violate any provision of the articles of
incorporation or code of regulations of the Borrower.
8. GOVERNMENTAL APPROVALS. No order, consent, approval,
license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any Ohio or United States federal
governmental or public body or authority, or any subdivision thereof,
is required to authorize or is required as a condition to (i) the
execution, delivery and performance by the Borrower of any Credit
Document to which it is a party, or (ii) the legality, validity,
binding effect or enforceability of any such Credit Document.
9. LITIGATION. To our knowledge, there are no actions, suits
or proceedings pending or threatened with respect to the Borrower or
any of its Subsidiaries that have, or could reasonably be expected to
have, a Material Adverse Effect, or which question the validity or
enforceability of any of the Credit Documents, or of any action to be
taken by any Credit Party pursuant to any of the Credit Documents to
which it is a party.
10. INVESTMENT COMPANY ACT, ETC. The Borrower is not subject
to regulation with respect to the creation or incurrence of
Indebtedness under the Investment Company Act of 1940, as amended, the
ICC Termination Act of 1995, as amended, the Federal Power Act, as
amended, the Public Utility Holding Company Act of 1935, as amended, or
any applicable state public utility law.
* * * * *
The opinions set forth above are subject to the following assumptions,
qualifications and limitations:
(a) We express no opinion with respect to any provision in any
of the Credit Documents purporting to allow the collection of
attorneys' fees or other expenses of enforcement.
(b) We express no opinion with respect to (i) the power or
authority of the Administrative Agent and/or the Lenders to make the
Loans contemplated by the Credit Documents; (ii) compliance by the
Administrative Agent and/or the Lenders with any federal or state law,
rule, regulation or restriction relating to banking or lending; or
(iii) compliance by the Administrative Agent and/or the Lenders with
any federal or state law, rule, regulation or restriction which is or
was required to be complied with by the Administrative Agent and/or the
Lenders (as opposed to compliance therewith by the Borrower) in order
to enforce any rights of the Administrative Agent and/or the Lenders
under any of the Credit Documents.
(c) We express no opinion as to the availability of any
equitable or self-help remedy in the event of a breach of the Credit
Documents or as to the right of the Administrative Agent and/or the
Lenders to exercise remedies available to them upon the happening of a
non-material breach under the Credit Documents.
This opinion letter is being furnished only to the addressees and is
solely for their benefit and the benefit of their participants and assigns in
connection with the transactions contemplated by the Credit Documents. This
opinion letter may not be relied upon for any other purpose, or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
3
<PAGE> 108
EXHIBIT E
---------------------------
FORM OF
ASSIGNMENT AGREEMENT
---------------------------
<PAGE> 109
ASSIGNMENT AGREEMENT
DATE:_____________
Reference is made to the Credit Agreement described in Item 2 of Annex
I annexed hereto (as such Credit Agreement may hereafter be amended, modified or
supplemented from time to time, the "CREDIT AGREEMENT"). Unless defined in Annex
I attached hereto, terms defined in the Credit Agreement are used herein as
therein defined.
_____________ (the "ASSIGNOR") and ______________ (the "ASSIGNEE")
hereby agree as follows:
1. The Assignor hereby sells and assigns to the Assignee without
recourse and without representation or warranty (other than as expressly
provided herein), and the Assignee hereby purchases and assumes from the
Assignor, that interest in and to all of the Assignor's rights and obligations
under the Credit Agreement as of the date hereof which represents the percentage
interest specified in Item 4 of Annex I (the "ASSIGNED SHARE") of all of
Assignor's outstanding rights and obligations under the Credit Agreement
indicated in Item 4 of Annex I, including, without limitation, all rights and
obligations with respect to the Assigned Share of the Assignor's Commitment and
of the Loans, Unpaid Drawings and the Notes held by the Assignor. After giving
effect to such sale and assignment, the Assignee's Commitment will be as set
forth in Item 4 of Annex I.
2. The Assignor (i) represents and warrants that it is duly authorized
to enter into and perform the terms of this Assignment Agreement, that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any liens or security interests; (ii)
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
the Credit Agreement or the other Credit Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or the other Credit Documents or any other instrument or document
furnished pursuant thereto; and (iii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any of its Subsidiaries or the performance or observance by the
Borrower or any of the other Credit Parties of any of its obligations under the
Credit Agreement or the other Credit Documents or any other instrument or
document furnished pursuant thereto.
3. The Assignee (i) represents and warrants that it is duly authorized
to enter into and perform the terms of this Assignment Agreement; (ii) confirms
that it has received a copy of the Credit Agreement and the other Credit
Documents, together with copies of the financial statements referred to therein
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment Agreement;
(iii) agrees that it will, independently and without reliance upon the
Administrative Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iv) appoints and authorizes each Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement and the
other Credit Documents as are delegated to such Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; [and] (v) agrees
that it will perform in accordance with their terms all of the obligations which
by the terms of the Credit Agreement are required to be performed by it as a
Lender[; and (vi) to the extent legally entitled to do so, attaches the forms
described in section 5.4(b)(ii) of the Credit Agreement6.
4. Following the execution of this Assignment Agreement by the Assignor
and the Assignee, an executed original hereof (together with all attachments)
will be delivered to the Administrative Agent. The effective date of this
Assignment Agreement shall be the date of execution hereof by the Assignor, the
Assignee and the consent hereof by the Administrative Agent and the receipt by
the Administrative Agent of the administrative fee referred to in section
12.4(c) of the Credit Agreement, unless otherwise specified in Item 5 of Annex I
hereto (the "SETTLEMENT DATE").
- --------------
6 If the Assignee is organized under the laws of a jurisdiction outside
the United States.
<PAGE> 110
5. Upon the delivery of a fully executed original hereof to the
Administrative Agent, as of the Settlement Date, (i) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment
Agreement, have the rights and obligations of a Lender thereunder and under the
other Credit Documents and (ii) the Assignor shall, to the extent provided in
this Assignment Agreement, relinquish its rights and be released from its
obligations under the Credit Agreement and the other Credit Documents.
6. It is agreed that upon the effectiveness hereof, the Assignee shall
be entitled to (x) all interest on the Assigned Share of the Loans at the rates
specified in Item 6 of Annex I, (y) all Facility Fee (if applicable) on the
Assigned Share of the Commitment at the rate specified in Item 7 of Annex I, and
(z) all Letter of Credit Fees (if applicable) on the Assignee's participation in
all Letters of Credit at the rate specified in Item 8 of Annex I hereto, which,
in each case, accrue on and after the Settlement Date, such interest and, if
applicable, Facility Fee and Letter of Credit Fees, to be paid by the
Administrative Agent, upon receipt thereof from the Borrower, directly to the
Assignee. It is further agreed that all payments of principal made by the
Borrower on the Assigned Share of the Loans which occur on and after the
Settlement Date will be paid directly by the Administrative Agent to the
Assignee. Upon the Settlement Date, the Assignee shall pay to the Assignor an
amount specified by the Assignor in writing which represents the Assigned Share
of the principal amount of the respective Loans made by the Assignor pursuant to
the Credit Agreement which are outstanding on the Settlement Date, net of any
closing costs, and which are being assigned hereunder. The Assignor and the
Assignee shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Settlement Date directly between themselves
on the Settlement Date.
7. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
[NAME OF ASSIGNOR], [NAME OF ASSIGNEE],
as Assignor as Assignee
By:____________________________ By:____________________________
Title: Title:
Acknowledged and Agreed:
NATIONAL CITY BANK,
as Administrative Agent
By: ______________________________
Vice President
2
<PAGE> 111
ANNEX I
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
1. The Borrower:
FERRO CORPORATION
2. Name and Date of Credit Agreement:
Credit Agreement, dated as of May 9, 2000, among Ferro
Corporation, the Lenders from time to time party thereto, and
National City Bank, as Administrative Agent.
3. Date of Assignment Agreement:
--------- ---, -----
4. Amounts (as of date of item #3 above):
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
GENERAL REVOLVING GENERAL REVOLVING SWING LINE REVOLVING SWING LINE REVOLVING
COMMITMENT LOANS COMMITMENT LOANS
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AGGREGATE AMOUNT FOR $_____ $_____ $_____ $_____
ALL LENDERS
- --------------------------------------------------------------------------------------------------------------------
ASSIGNED SHARE _____% _____% _____% _____%
- --------------------------------------------------------------------------------------------------------------------
AMOUNT OF ASSIGNED $_____ $_____ $_____ $_____
SHARE
- --------------------------------------------------------------------------------------------------------------------
AMOUNT RETAINED BY $_____ $_____ $_____ $_____
ASSIGNOR
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
5. Settlement Date:
--------- ---, ---
6. Rate of Interest
to the Assignee: As set forth in section 2.7 of the Credit
Agreement (unless otherwise agreed to by the
Assignor and the Assignee).7
- ------------
7 The Borrower and the Administrative Agent shall direct the entire
amount of the interest to the Assignee at the rate set forth in section
2.7 of the Credit Agreement, with the Assignor and Assignee effecting
any agreed upon sharing of interest through payments by the Assignee to
the Assignor.
<PAGE> 112
7. Facility
Fee: As set forth in section 4.1(a) of the Credit
Agreement (unless otherwise agreed to by the
Assignor and the Assignee).8
8. Letter of
Credit Fees: As set forth in section 4.1(b) of the Credit
Agreement (unless otherwise agreed to by the
Assignor and the Assignee).9
9. Notices:
ASSIGNOR: ASSIGNEE:
- ---------------------- ----------------------
- ---------------------- ----------------------
- ---------------------- ----------------------
Attention: Attention:
Telephone No.: Telephone No.:
Facsimile No.: Facsimile No.:
10. Payment Instructions:
ASSIGNOR: ASSIGNEE:
- ---------------------- ----------------------
- ---------------------- ----------------------
- ---------------------- ----------------------
ABA No. ABA No.
Account No.: Account No.:
Reference: Reference:
Attention: Attention:
Telephone No.: Telephone No.:
Facsimile No.: Facsimile No.:
- ------------
8 The Borrower and the Administrative Agent shall direct the entire
amount of the Facility Fee to the Assignee at the rate set forth in
section 4.1(a) of the Credit Agreement, with the Assignor and the
Assignee effecting any agreed upon sharing of Facility Fee through
payment by the Assignee to the Assignor.
9 The Borrower and the Administrative Agent shall direct the entire
amount of the Letter of Credit Fees to the Assignee at the rate set
forth in section 4.1(b) of the Credit Agreement, with the Assignor and
the Assignee effecting any agreed upon sharing of the Letter of Credit
Fees through payment by the Assignee to the Assignor.
2
<PAGE> 113
EXHIBIT F
---------------------------
FORM OF
DESIGNATION AGREEMENT
---------------------------
<PAGE> 114
DESIGNATION AGREEMENT
Dated _____________, 20____
Reference is made to the Credit Agreement, dated as of May 9, 2000 (as
amended, supplemented or otherwise modified from time to time, the "CREDIT
AGREEMENT"), among Ferro Corporation, an Ohio corporation (herein, together with
its successors and assigns, the "BORROWER"), the Lenders (as defined in the
Credit Agreement), and National City Bank, as Administrative Agent for the
Lenders (the "ADMINISTRATIVE AGENT"). Terms defined in the Credit Agreement are
used herein with the same meaning.
__________________________ (the "DESIGNATOR") and ____________________
(the "DESIGNEE") agree as follows:
1. The Designator hereby designates the Designee, and the Designee
hereby accepts such designation, to have a right to make Competitive Bid Loans
pursuant to section 2.3 of the Credit Agreement.
2. The Designator makes no representation or warranty and assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto and
(ii) the financial condition of the Borrower or the performance or observance by
the Borrower of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto.
3. The Designee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
section 7.8(a) thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Designation Agreement and, if the Designee is an insurance company, represents
and warrants that the designation hereunder shall not constitute or otherwise
result in any prohibited transaction under section 406 of ERISA or section 4975
of the Internal Revenue Code; (ii) agrees that it will, independently and
without reliance upon the Administrative Agent, the Designator or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement; (iii) confirms that it is a Designated
Bidder; (iv) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a
Lender; and (vi) specifies as its Applicable Lending Office with respect to
Competitive Bid Loans (and address for notices) the offices set forth beneath
its name on the signature pages hereof.
4. Following the execution of this Designation Agreement by the
Designator and its Designee, it will be delivered to the Administrative Agent
for acceptance and recording by the Administrative Agent. The effective date of
this Designation Agreement shall be the date of acceptance thereof by the
Administrative Agent (the "EFFECTIVE DATE").
5. Upon such acceptance and recording by the Administrative Agent, as
of the Effective Date, the Designee shall be a party to the Credit Agreement
with a right to make Competitive Bid Loans as a Lender pursuant to section 2.3
of the Credit Agreement and the rights and obligations of a Lender related
thereto.
6. This Designation Agreement shall be governed by, and construed in
accordance with, the laws of the State of Ohio.
7. This Designation Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
<PAGE> 115
IN WITNESS WHEREOF, the parties hereto have caused this Designation
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
[NAME OF DESIGNATOR]
By:__________________________________
Vice President
[NAME OF DESIGNEE]
By:__________________________________
Vice President
Applicable Lending
Office (and
address for
notices):
[Address]
Accepted this ______ day
of ____________, 20___
NATIONAL CITY BANK,
AS ADMINISTRATIVE AGENT
BY: ___________________________________
VICE PRESIDENT
2
<PAGE> 116
EXHIBIT G
SECTION 5.4(B)(II) CERTIFICATE
Reference is hereby made to the Credit Agreement, dated as of May 9,
2000, among Ferro Corporation, the financial institutions party thereto from
time to time, and National City Bank, as Administrative Agent (the "CREDIT
AGREEMENT"). Pursuant to the provisions of section 5.4(b)(ii) of the Credit
Agreement, the undersigned hereby certifies that it is not a "bank" as such term
is used in section 881(c)(3)(A) of the Internal Revenue Code of 1986, as
amended.
[NAME OF LENDER]
By:_______________________________
Title:
Dated:__________
<PAGE> 1
EXHIBIT 12
FERRO CORPORATION AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES
MARCH MARCH
(DOLLARS IN THOUSANDS) 2000 1999
------- --------
Earnings:
Pre-Tax Income $29,469 $27,365
Add: Fixed Charges 5,919 4,418
Less: Interest Capitalization (139) (333)
------ ------
Total Earnings $35,249 $31,450
====== ======
Fixed Charges:
Interest Expense 5,626 3,918
Interest Capitalization 139 333
Interest Portion of Rental Expense 154 167
------ ------
Total Fixed Charges 5,919 4,418
====== ======
Total Earnings $35,249 $31,450
Divided By:
Total Fixed Charges $ 5,919 $ 4,418
------ ------
Ratio 5.95 7.12
Note: Preferred dividends are excluded. Amortization of debt expense and
discounts and premiums were deemed immaterial to the above calculation.
17
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000035214
<NAME> FERRO CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 10,455
<SECURITIES> 0
<RECEIVABLES> 270,199
<ALLOWANCES> 0
<INVENTORY> 168,422
<CURRENT-ASSETS> 503,282
<PP&E> 718,015
<DEPRECIATION> 391,950
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 331,721
<BONDS> 251,391
0
0
<COMMON> 47,323
<OTHER-SE> 251,137
<TOTAL-LIABILITY-AND-EQUITY> 976,391
<SALES> 360,612
<TOTAL-REVENUES> 360,612
<CGS> 260,542
<TOTAL-COSTS> 324,490
<OTHER-EXPENSES> 6,653
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,626
<INCOME-PRETAX> 29,469
<INCOME-TAX> 11,069
<INCOME-CONTINUING> 18,400
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 18,400
<EPS-BASIC> 0.50
<EPS-DILUTED> 0.48
</TABLE>
